I came across a recent article written by Warren Buffett, and I think that what he says is worth a thought…

“A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful.”

“I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month - or a year - from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over.”

“Today people who hold cash equivalents feel comfortable. They shouldn’t. They have opted for a terrible long-term asset, one that pays virtually nothing and is certain to depreciate in value. Indeed, the policies that government will follow in its efforts to alleviate the current crisis will probably prove inflationary and therefore accelerate declines in the real value of cash accounts”.

Quoted from the New York Times, October 16, 2008.

Should I be listening to good old Mr Buffett? Why not? Think about it…