If you’re looking to invest this would be a good time to do it. Many stocks are on sale as a result of a massive plunge today. The upside to all of this is that oil is now less than $90 a barrel. While advertisers still try to play on “rising gas prices” to sell you various things the fact is that gas prices have been going down. People expected the hurricanes to drive up gas prices and yet they continued downward. Only in areas directly affected by the hurricanes did gas prices go up. And much of that was due to price gouging and media driven panic.
That should be a big giant clue that oil prices are highly inflated and are not related to current supply vs demand. If that were the issue then refineries in the gulf going out of commission would have affected gas prices in Arizona. But it didn’t. Gas prices continued their downward trend inching closer to $3.00 a gallon.
Oil prices are related to the market which is based on emotions and speculation. So since the market is tanking so are oil prices.
I’m currently invested in a Candian Royality Trust which has its hands in every aspect of the oil industry in Canada. The stock is worth about half of what I paid for it although generous dividends have limited the actual loss.
How low can the markets go? Who knows. But it will bounce back. So you can wait for it to bottom out or start buying discount stock now. I’d start buying discount stock now. If the stock continues to drop then buy more of it. Eventually it will go back up and you have a very good chance of coming out ahead.
You just have to make sure you’re investing in good companies going through a rough time. And not bad companies that will end up going bankrupt. There’s nothing less fun than seeing a stock you heavily invested in suddenly not being on the exchange.
