"For all intents and purposes," the U.S. economic recession is over, a regional executive for the Federal Reserve said recently while at Austin Peay State University.
Adding, "The recession probably ended in June or July of this past year, but the footnote to this, as reported on the cover of Newsweek magazine is, 'Good luck surviving the recovery.'"
Surviving indeed. U.S. unemployment numbers came out on Friday, March 5th. While more people entered the workforce, the unemployment rate was unexpectedly unchanged at 9.7%.
The economic crisis hasn’t just impacted the average American penny stock investor either. In the most recent issue of “Amazing Spider Man” Peter Parker finds out he has been fired. It gets worse. Mayor J. Jonah Jameson not only sacks Parker, who makes his living as a photojournalist, he blacklists him with every news organization in town.
Apparently Parker lost his job because of an evil villain, not because of the recession or downsizing. Mind you, I think that’s something we all like to think should we have the misfortune of being fired. It’s not because of the rough economy or my lack of talent; it’s because of an evil villain.
Granted, it’s not as though Wall Street hasn’t been producing economic villains over the last two years, be they individual or institutional…or a mix of the two.
Aside from being a breeding ground for financial villains, Wall Street also has a knack of telling investors that penny stocks ought to be avoided at any cost. Not only that, Wall Street can actually convince penny stock investors that lower priced stocks are bad and higher priced stocks are good.
Meaning, there are many investing gurus that will tell you to wait for the perfect time to jump into the market and to wait for the perfect time to exit the market. Seasoned penny stock investors already know that the markets go through cycles, even in recessions.
Keeping an eye on the markets at large will help you anticipate cyclical changes, and help you take advantage of market fluctuations, big or small – in either direction.
If you have done your due diligence and are confident in your penny stock company then you already know that the fundamental quality of the penny stock does not change simply because its price rises and falls in response to market conditions.
When an excellent, fundamentally strong penny stock moves lower, you should see it as an opportunity, not a problem. When your penny stock trends higher, it's an opportunity to take profits.
Buying into the hype and momentum of a penny stock when it’s at a 52-week high might seem like a great knee-jerk idea. But it isn’t. Wait for others to take their profits – then step in.
Conversely, selling your favorite penny stock just because unrelated market conditions send it lower doesn’t make sense either. Sadly, investors are not perfect, and we do not all act in a completely rational fashion.
If you have the opportunity to buy your favorite penny stock when its prices are depressed - do. Heavens knows everyone I know would buy a new car or house they liked if it was offered at half price.
Bad news creates opportunities; so does good news. As one investing author noted recently, “The direction of the market isn't nearly as important as the actions we take in anticipation of the next directional change.”
I think the days of blindly listening to Wall Street gurus as if they’re investing heros is at a close. Wall Street may have years of work ahead of itself before the average American views it as anything but villainous.
After all, no one likes to see Wall Street being bailed out by Main Street…and for those same Wall Street scoundrels to take home excessive bonuses. At least I don’t know any penny stock investors that do. And I’m pretty sure Peter Parker and Spider Man are on side too.
