Stocks

[Stewie]

Originally Posted by chubychecker

Remember recessions are a normal part of the economic cycle and they happen on average about every five years. Recessions are also relatively short averaging a little over 10 months; we have been in one since October. Many people say that once you know your in a recession it is already over. In times like these I am reminded of a Warren Buffet quote "when people are fearful, I am greedy"

The reality is that for the long term investor times like these can be a very good time to add money. By the time we wait until the economic outlook is "more positive" we will miss a big rebound.

Some stocks that I like right now:
ABK: AAA rating affirmed last week, beaten down big time,
AIG: One of the worlds largest insurers, at or near lows for the year had some negative news a few weeks back; market overreacted a bit.
DHI: U.S. largest homebuilder; obviously an industry that has had some troubles over the last couple of years. Very strong balance sheet and should be able to rebound nicely when outlook improves.
DRE: One of the biggest REITS; much like DHI good company in struggling industry when markets turn around should be in good position. Also pays strong dividend.

It would take some balls to invest in ABK or AIG right now. ABK is on the brink of bankruptcy. Don't read anything into AAA ratings. Those ratings have been exposed for being fraudulent and is the crux of the credit crunch right now. AIG also has exposure to OTC derivatives which can bring a company to its knees over night. Bears Stearns learned that last week. They were financially solid on Wednesday and bankrupt on Friday.

Home builders and REITS. There are better places to be.