Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Hello Share Toddlers. My weekend piece suggesting we don’t sell our shares too soon received a critical response from Uncle Tom. It’s a return to the familiar battle between me in the blue corner and the sage of Bristol in the red one.
As the bull market continues, the one thing we can say for certain is that the end will come, probably sooner than later. It always does. The question is: when?
Tom is selling shares now. I am still buying into the rally. We both agree that debt is horrendous. When interest rates rise, that burden will increase. But all over the world, governments are not increasing interest rates for that very reason. There are no imminent signs of a rates rise. It could be many years before it happens in the UK. Meanwhile, we could be making good money buying shares.
Tom anticipates a crash far earlier than I do. But we all know that everything in the world of business takes a heck of a lot longer than expected. Huge changes expected to take place in companies take years rather than weeks.
And it happens in the macro sense as well. A crash may be overdue, but it doesn’t mean it will take place fast. Not with 99% of the business world doing their damnest to stop that happening.
Both big bears, Lucian and Evil, acknowledged on the UK Investor Show stage that they had lost money this year. I, like all bulls, have done rather well. Meanwhile I stick with the ‘Trend is your Friend’ dynamic. As soon as the bull market runs out of steam, I am selling. And yes, there will often be time to salvage the vast majority of your pile.
I know. I’ve been there loads of times. I have not always made a success of this brinkmanship strategy - shares can sometimes crash like anvils down lift shafts - but I’m getting more experienced.
The worst feeling you can have when trading shares is to find out that the share you sold goes on to become a massive earner. Think ASOS (ASC). If your shares suffer in a crash and you were not on the ball enough to sell fast, you’ll probably get another chance. It may take years for recovery, but if you made the right choice in the first place, the value should come back.
I’m not arrogant enough to say that I am right and Tom is wrong. We all know that Shareland is illogically unpredictable. But so far, my bullish outlook since 2008 seems to have paid off. I want to give it a bit longer.
As most of us do in the Punter’s Return.
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