Obama wants you to buy stocks

I don’t know about you but when the president of the United States starts telling everyone that they should be buying stocks you have to wonder. If Warren Buffet was wrong just a few months ago when said the same thing and the market began to unravel last November, why should we listen to Obama who I suppose doesn’t make a living investing in the stock markets when the markets are still plunging downwards. Or maybe this is a good sign. When Buffet made the statement to buy stocks, he also went on to say that he expected another one or two major financial institutions to fail after Lehman’s had already done so.

Back to Obama, should we pour money into stocks now? In an interview with Jim Cramer on street.com his view is that any rallies in the bank stocks are only temporary and should be used as an exit point to get out while you can. This is because Geithner has not given americans enough detailed policies on how the US will not allow another bank to fail. Right now, they want the banks to go through a stress test for the next six months. The RRSP contribution deadline just passed and I wonder if anyone will do a survey on how much funds were contributed and into what investment vehicle.

Who knows. Maybe we should listen to Obama if Buffet was wrong before. People buy mutual funds based on whatever the bank salespeople recommend. And those recommendations tend not to reflect any specific market research. They only reflect the banks standard basket of funds so that they can make money off of you accompanied with the standard brochures depicting what $10k would look like in forty years or so. That is if the market goes according to plan.