If you’re thinking of getting back into stocks, it’s better to arrive late than too early says Ben Traynor. Yes, losses this year have been spectacular. And the temptation to bargain hunt is strong. But Ben says investors should remember that they still have a once-in-a-lifetime opportunity to lose a lot of money very quickly.

This from Fleet Street Daily:

I attended a most interesting lecture last night at the London School of Economics. It left me feeling that anyone who rushes back into the stock market now must be barking mad (you’ll see why in a moment).

Entitled ‘The Subprime Crisis’, it was given by Professor Robert Shiller of Yale. Shiller’s well worth hearing on this stuff. A former advisor to new US Treasury boss Tim Geithner (“He had no idea this was coming”), Shiller forewarned of both the dotcom bubble and the more recent one in housing.

The lecture kicked off with

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Last month, I spent some time in San Juan, Puerto Rico. One day, we visited Old San Juan, the oldest settlement within the territory of the United States, with a history that begins in 1508. We also visited the old fort known officially as El Castillo San Felipe del Morro, or simply El Morro.

The fort must have sent shivers up the spines of all those who hoped to take it. The walls of El Morro are 18 feet thick and 145 feet high. Built on a headland, the Spanish Empire controlled the flow of goods in and out of the New World from here. El Morro has been tested many times. Even today, you can walk in the oldest tower in the fort, built in 1539, and see shell fragments in the ceiling that date to the 1898 bombardment of San Juan by the U.S. Navy during the Spanish-American War.

El

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Your retirement nest egg might have lost 40% of its value since this summer and 10% the last 2 weeks. What should you do? Here's the advice I've been giving to friends who ask, as well as what I've been doing with my own portfolio.

First, let me begin by stating that I make no claim whatever to be able to predict whether stock prices will go up or down over the near term or when the market bottom might be reached. In part that humility is inspired by a large academic literature demonstrating that it's very hard to predict stock prices with formal statistical models.

The one element of predictability for which I do see some support in the academic literature is the claim that the price/dividend or price/earnings ratios do not wander too far from their long-run historical averages. The implication of that finding is that

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Uncertainty still "the rule" among investors; not optimal time to raise assets.

 

MacroMarkets is planning to delay the first-ever initial public offering open-auction launch of exchange-traded funds, which had been initially set for an opening auction date of tomorrow. Market conditions, rather than lack of interest in the planned U.S. housing market ETFs, have led the company to delay the launch.

Whitney White, chief technology officer at WR Hambrecht + Co, who is in charge of the IPO open auction of the MacroShares Major Metro Housing Up ETF (UMM) and Major Metro Housing Down ETF (DMM), said that there is the sense right now that uncertainty is still the rule among investors and it is not the best time to be out raising assets.

Across the board, exchange-traded product providers have pulled back the reins on fund launches, with net liquidations of funds keeping pace with

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Warren Buffett says buy. Jeremy Grantham says it will get worse. Both are celebrated value investors. Who is right? It all depends upon your view of the third derivative of investing. Today we look at valuations in the stock market. This is the second part of a speech I have given in the past few weeks in California and Stockholm. I am updating the numbers, as the target keeps moving. 

While from one perspective things look rather difficult, from another there is a ray of hope. What can you expect to earn from stocks over the next five years? It should make for an interesting letter. Note: this will be a little longer than usual, but part of it is there are a LOT of charts.

I likened this to the economic situation we are in now. With consumer spending “resetting” to a new lower level, we are going to have to

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Benjamin Graham, the teacher and mentor of Warren Buffett, wrote two seminal tomes on value investing called Security Analysis in 1934 and The Intelligent Investor in 1949. I was reading The Intelligent Investor at a time when the bear market following the dot com bubble was in full swing and I remember thinking to myself that some of what Mr. Graham mentions in his book may no longer hold true as even at that point  it was almost impossible to find stocks that met his criteria such as a Price/Book ratio of less than 1.5, a P/E < 15, uninterrupted dividends for last 20 years and an adequate margin of safety. If you like bargain hunting for things, you are probably aware that there is an intrinsic value to things and unless the seller is in distress it is very difficult to ...

Plenty of gloom out there if you're hungry for more. But I wanted to pass along a couple of developments this week that give me some hope.

First, via Rebecca Wilder and Arnold Kling, the Federal Reserve's H8 statistical release shows a big increase in real estate loans held by large commercial banks during the last week of September. There's likely a mechanical explanation in terms of some reallocation of security ownership during the recent turmoil. But if there has also been an increase of direct lending, that would be a promising development.

Real estate loans held by large commercial banks in billions of dollars. Source: Federal Reserve.

Whatever the meaning of those numbers, let me separately suggest that the recent dramatic drop in stock prices means that equities are more reasonably priced today than they have

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By ERIC CARVIN

NEW YORK (AP) — Trillions in stock market value — gone. Trillions in retirement savings — gone. A huge chunk of the money you paid for your house, the money you’re saving for college, the money your boss needs to make payroll — gone, gone, gone.

Whether you’re a stock broker or Joe Six-pack, if you have a 401(k), a mutual fund or a college savings plan, tumbling stock markets and sagging home prices mean you’ve lost a whole lot of the money that was right there on your account statements just a few months ago.

But if you no longer have that money, who does? The fat cats on Wall Street? Some oil baron in Saudi Arabia? The government of China?

Or is it just — gone?

If you’re looking to track down your missing money — figure out who has it now, maybe ask

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As I am travelling in Europe at the moment (see “Another town, another train…”), this week’s edition of “Words from the Wise” does not provide the customary review of the financial markets’ movements and economic statistics. Given time constraints, today I will only share with you a number of video clips in lieu of excerpts from news items and quotes from market commentators. Quite a few of the video items include links to related articles for those who prefer the written word.

Firstly, as we are awaiting word on the bail-out plan, a very topical quote from Jim Welsh (Welsh Money Management): “We will be told that the Federal Reserve and

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Mr. Market stopped in for a few belts and came out one nasty bear and beat bulls mercilessly. Sure, there was a lot of news that would drive most to drink like poor employment data, dismal retail sales, negative comments by housing guru Robert Shiller, warnings of a financial tsunami by Bond Daddy Bill Gross and a poor report by networking giant Ciena. Reality is tough to accept sometimes especially when talking heads in the media are chirping at you every day that “the bottom is in” and to “buy stocks with both hands”. Yesterday media clown in chief, Jim Crammer stated: “rallies are real but sell-offs phony”. He’s busy trying to find that tape to destroy it. Volume increased during the phony [?] sell-off and breadth was as negative as expected. ...