Get Ready for Stock Market Take-Off

We have to put academic matters aside until further notice. The stock market nightmare that started with U.S. sub-prime in September 2007 is about to end. Some folks surface from slumber in stages. So may it be with stocks in July 2008. A market is up one day, and down shortly thereafter. This is not range-bound trading, but a gradual consciousness that dawn is on the eastern horizon.

Attrition strategies must now yield center-stage to rapid growth and vigorous profits. Business managers and stock investors should gird their loins to ride crests of demand waves. Balance and a sense of timing distinguish the best surfers. It will not help to buy the wrong stocks just because the macro outlook is so enticing. How can we find the right beach-head?

Foreign institutions may pour money in simply because the U.S. Fed backs them with cheap cash in dollars of declining worth. Corrupt politicians are limited to recycling ill-gotten gains through promissory notes managed by the trusted but incompetent. No bull run is famous for logic. Lookers-on could get hurt if they try the stunts that so thrill. The riddle of what to buy is clued by who buys. You cannot beat a buy-back by a block owner.

Stock market celebrities may have ego reasons to shore up their stocks. However, intelligent investing rather than emotions have made them successful in the stock market ring. They take-over stocks they once offered the market because they can see a bright spot hidden from public view. No business magnate increases stock-holding without sound reasons. You are well-advised to follow such herds.

Here is an example of a stock battered throughout June 2008, which has become a top pick following management buy-back in July 2008:

http://www.dlf.in/wps/portal#

There is a second approach to knowing when to start buying after a bear phase. Let us dwell on this tomorrow.