Sep 16, 2008 8:54 am US/Pacific
Experts: Buy More Stocks Now
DENVER (CBS) ―
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Financial experts said Monday investors should not panic after the Wall Street slide triggered by the collapse of Lehman Brothers and sale of Merrill Lynch. One expert said people who can afford to should actually buy more stock at this time.
"The truth is the devaluation in stocks is extremely modest, and in fact, at historical lows," said Bruce Allen, a Denver-based investment expert. "We haven't seen stocks this cheap in a very, very long time."
Allen said the financial woes that were featured Monday were a direct result of the housing market burst. The rate of foreclosures has been up for months, and now the ripple effect is being seen.
"It is exactly a direct consequence of people not paying their mortgage," Allen said.
The dire warnings in headlines has many wondering what to do.
"Absolutely stay with it because the values are there," said Allen.
The slumping market does make it more difficult to get a loan as banks buckle down. But Allen said the banking system is safe, insured by the FDIC.
While no one can predict the future, Allen anticipates the end of the financial mess is near.
"We're getting close to the point where this thing is over," he said. "We're in the 7th or 8th inning of a 9 inning ball game."
Allen said to view the stock market like other aspects of consumer life. If a shirt is on sale, some shoppers may buy two or three.
He said stocks are on sale now and people should be buying more because when the market moves, it is going to move dramatically.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
Timeline: U.S. Credit Crunch & Financial Failures
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