Will market distrust from the crisis change how people invest?

[Karl G.]

Unfortunately, many of the hoi polloi fail to get a good grasp of the problem ... in the 1930's (when, despite political rhetoric to the contrary, things were a lot worse than they are now), the real winners were those who bought stocks cheap and made huge profits when the market eventually rose again. The loosers where those who sold out, which is the first reaction many people have. As a long-term invesment strategy, stocks are the best bet.

 

[Vanadium 50]

It's true that fortunes are made during recessions - but you don't know you're making them at the time. However it's also true that the market can stay irrational longer than you can stay solvent.

 

[Astronuc]

IBM has done quite well, even in the current economic downturn, although many IBM employees (and retirees) have not.

IBM in talks to buy Sun Micro: report
http://news.yahoo.com/s/nm/20090318/bs_nm/us_sunmicro_takeover_ibm

It's interesting to look at how Sun's stock has done over the past couple of decades.

At Tuesday's closing, Sun (JAVA: NASDAQ) was $4.97/share. Compare this with $258.75, the high during Aug/Sep 2000. On Oct 5, 1999 the stock was around $20 /share, so if one rod it to the top and sold out, one could have seen a 12-fold increase in value. But after September, it's been downhill ever since. Sun stock is down about 70 percent in the beginning of 2008.