Market recovery requires faith
Published 12:00 am Wednesday, July 24, 2002
The Dow Jones Average plunged below 8,000 on Monday, following a dangerously downward trend that has sent many investors heading for home with with remainder of their dollars.
And that’s disturbing.
Because we believe the market’s downward spiral contradicts other signs of what appeared to be a slowly strengthening economy. Indicators, from consumer spending to jobless rates, were beginning to spark positive remarks from analysts and national experts.
Then corporate corruption stuck, in Enron and WorldCom and even Martha Stewart’s backyard, and investors began to lose faith. They questioned the integrity of the companies in which they were investing, and they questioned the integrity of the free market system.
Even with President Bush’s earnest campaign for corporate responsibility ­ and a call for more federal funding to help support agencies which can better regulate corporate fraud ­ investors’ confidence remains shaky. It’s evident in days like Friday and Monday, when the Dow’s average plummeted and national newscasts were filled with stories of more losses ahead.
Investor Warren Buffett described the cycle as one of washing out dirty laundry … and he went on to say that when the cycle ends we’ll have clean laundry, fresh water and a good start once again.
We’d like to agree with Buffett. We certainly see the cyclical nature of the market and the impact that knee-jerk reactions by anxious investors can have.
But we also recognize that investors must find their confidence once again, and they must feel comfortable putting their money ­ and their faith ­ in these companies and our free market system.
We believe you should.
Letters: Send your commentary to the Troy Messenger.
News tips: Have a story or tip for our staff?
Subscribe: Get the Troy Messenger delivered to your door or mailbox.