Today's Market
by Dr Invest

I have never seen RATS so quickly abandoning ship. Only two days earlier, the talking heads were speaking with such conviction that "NOW is the time to buy while the market has hit new lows". Now, before the JOBS REPORT is out on Friday, the little beady-eyed financial advisers are jumping ship.

After eight months of market rise, there is still the belief that if the market acts paniced enough, Bernanke and company will stimulate once again, and the markets will be flying high.

This is the fundamental problem. Simulation and promises of stimulation only have a short-term effect and prolong the inevitable. The financial ship has been sinking since 2008. Monetary policies has kept the ship afloat...kinda. After the initial collapse in 2008 and breath taking job losses, people began to save money. With the feel-good QE-1 and QE-2, people were fooled into thinking that good times were here again. After a cage rattling August in 2011, the market began to cautiously move forward at the urging of more monetary polices (twist). People began to spend again... to spend money that was borrowed and some they had saved back; they had not learned the lesson that debt was the reason the market had become so volatile. An 8.2% unemployment rate is NOT GOOD. People consuming their life savings to pay debt while waiting and hoping for a job is NOT GOOD. Admittedly some of this is SEASONAL, but our economy and the world's economy is staggering, reeling as someone off balance.

I do believe that some will try everything to revive the hot financial market, if only to get private investors to drive the stock prices a bit higher, but the RATS have already left the ship.

BOND INVESTING

Seasonal charts point to investing into BONDS at this time. I am investing into BND and TIP. I have given you the process and steps that I use. This method is simmular to the "Ivy Portfolio" method. Read the past two blogs to learn more.

On May 2nd, I purchased BND for 83.72 and TIP for 119.20 per share. Today, BND closed at $83.85 and TIP closed at 119.02. Bond ETFs move at a much slower pace than STOCKS or Stock ETFs. For example, a stock like CATM could swing 5% in just one day. This large of a swing in BONDS is not likely. As instricted in the "Ivy Portfolio" I will wait to see the status of BND and TIP at the beginning of June.

According to the method I am using, if you had a $10,000 portfolio, the first investment would have been $555 into BND and $555 into TIP. Investment is made again in June, and again in July using the same numbers. Go back and read the previous two blogs to learn how to invest your portfolio.

By the way, today record numbers were recorded in the INFLOWS to TIP. So if you have been smart enough to make your own purchases of BND and TIP at this time, you will be optimizing your opportunity for success.

NO GUARANTEES

There are no guarantees when it comes to investing, just opportunities. You want to protect any investment you have with STOP-SELLS and limit your losses. You want to move the STOP-SELL behind your ETF as the price moves higher. Right now, I want to get into BND and TIP. In the next day or two, I will set a STOP-SELL on each ETF.

(note: the above information is for entertainment purposes only, contact your investment adviser before making any investment.)