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Why a Stock Market Crash Shouldn’t Matter

2009-11-23

 I published an article on Seeking Alpha over the weekend that received quite a response. The title was: Why a Stock Market Crash Doesn’t Matter. Upon further reflection, I wish I had titled it – Why a Stock Market Crash Shouldn’t Matter.

My reasoning is simple. I see the stock market as merely the store you shop at to buy stocks. In other words, it is not an entity, it is a place. Inside this store are thousands of different pieces of merchandise called operating businesses. Each has their own identity and individual characteristics. Once I shop there and buy what I like, the store itself doesn’t matter anymore. I only care about what I now own.

To be more precise, the Stock Market Store is actually an auction market. I can go there to buy or sell businesses as I choose. However, once again, the overall state of the auction market matters little. I only care about the value of the specific businesses I am buying or selling at that moment.

Today’s video looks at the companies I covered in my article to support its thesis.

Best when viewed in full youtube screen.

I believe in thoroughly researching each and every investment you consider for either purchase or sale. I also believe that it is not a stock market; instead it’s a market of stocks.

Disclosure: Author Manages Portfolios Long COH, CTSH, ESI, GOOG, NKE, ORCL, PG and TEVA.
The opinions in this document are for informational and educational purposes only and should not be construed as a recommendation to buy or sell the stocks mentioned or to solicit transactions or clients. Past performance of the companies discussed may not continue and the companies may not achieve the earnings growth as predicted. The information in this document is believed to be accurate, but under no circumstances should a person act upon the information contained within. We do not recommend that anyone act upon any investment information without first consulting an investment advisor as to the suitability of such investments for his specific situation.

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