Like most investors after the worst stock market tumble in 10 years, I'm waking this Tuesday morning weary and wondering.
Was Monday's sharp stock market decline the opening round in a long and bloody market rout? Or, in some demented way, could Monday's 554-point drop prove to be a painful but still digestible market correction that helps keep stock values simmering without boiling over?
I doubt the former scenario. And I can only hope for the latter after the personal drubbing of my mutual fund holdings on Monday.
Do I sell, or possibly even buy? More likely, along with many fellow investors, I'll probably muddle along, sit on my stake in the stock market and lick the financial wounds from paper losses.
To be properly chastened for my investment shortcomings, I called up America's great stock market bear: Albert Sindlinger. His economic research company in Wallingford, Pa., has been surveying Americans about their financial confidence every week for nearly 50 years.
Al, a bear long before Smokey was invented, was only too glad to take my call for forgiveness.
Al, I told Sindlinger, I have sinned. I thought the stock market was rock-solid. I believed the gurus who swore the Dow was heading to 10,000.
You young fool, Al said. (Al's 90 years old, so he can call me anything he wants.) "This is the beginning of the bear market," he said. "It will take awhile for the truth to soak in, for people to realize the party is over."
Wait a minute, Al. Aren't we in a golden economic era?
"The problem here is that greed has taken over," he said. "Investors got hysterical, especially the young people who thought the stock market was a place where you save money."
But Al, I said, the market's been a financial bonanza for millions of people for years!
"There's no free lunch. And that's especially true in the stock market," Sindlinger replied. "You're not saving. You're better off gambling in Las Vegas where at least you can get a free drink."
So just how bad was Monday's market news?
+ The market decline was the worst drop since the October 1987 stock market crash. The Dow Jones Industrial Average sank 554 points Monday _ the worst point drop ever _ eclipsing the 508-point slide on Oct. 19, 1987.
+ The decline was so widespread that only 158 of the 3,397 stocks on the New York Stock Exchange showed a gain.
+ The market slide prompted an early close of trading for the first time since President Ronald Reagan was shot in 1981.
Was there any silver lining in Monday's markets?
+ The Dow's fall to 7,161.15 was a drop of just 7.2 percent. That's nowhere near the 22.6 percent plunge of Black Monday 10 years ago this month.
+ The economy _ with its low unemployment, low interest rates and low inflation _ isn't in a tailspin.
+ Monday's market drop amounted to a $600-billion sell-off. That's big bucks, but not when compared to the stock market's value of $8.5-trillion at the end of Monday's trading.
What's Al's investment advice? Stick your money in FDIC-insured CDs.
But Al, I said, some market hotshots already say this drop in the market may mean some buying opportunities lie ahead for smart investors.
"You'll see some rallies," Sindlinger acknowledged. "You can buy on the market dips _ and lose your ass."
Al the bear doesn't mince words. Even though I don't agree with all of Sindlinger's recommendations, his lecture at least serves us all well after so many years of market euphoria. The stock market isn't a sure thing. It has risk.
Al the bear's been waiting for the market to drop. He told his clients months ago to get out of stocks. Sindlinger said about 35 of them called him Monday to thank him for saving their nest eggs.
Even if Al has not called every turn of the market, he's been consistent.
After all, this is a fellow who traveled 100 miles in five hours to see his first Cleveland Indians game in 1919. This is a fellow who well remembers the 1929 market crash, when only 8 percent of the population owned stock (now it's 45 percent, or 82-million people). At 90, he has no plans to stop working.
"Who wants to retire? Old people bore me," the nonagenarian said.
SYMBOL- MONDAY AMOUNT PERCENT
COMPANY EXCHANGE CLOSE CHANGE Change
Dataflex Corp DFLX-NASD $3.0938 -$0.2188 -6.60%
Maxxim Medical MAM-NYSE $20.875 -$1.4375 -6.44%
Coast Dental CDEN-NASD $25.75 -$1.50 -5.50%
Apollo Int'l AIOD-NASD $6 -$0.3438 -5.42%
Intermedia Comm ICIX-NASD $44 -$2.50 -5.38%
Reptron Inc. REPT-NASD $15.75 -$0.875 -5.26%
Lincare Holdings LNCR-NASD $52.25 -$2.875 -5.22%
Tech Data Corp TECD-NASD $39.875 -$2.125 -5.06%
Checkers CHKR-NASD $1.2188 -$0.0625 -4.88%
Davel Communciations DAVL-NASD $26.50 -$1.25 -4.50%
PowerCerv PCRV-NASD $2.75 -$0.125 -4.35%
Bentley Pharm BNT-AMEX $2.875 -$0.125 -4.17%
Kimmins Corp KVN-NYSE $6.50 -$0.25 -3.70%
Healthplan Svcs Corp HPS-NYSE $19.625 -$0.75 -3.68%
Poe & Brown POBR-NASD $40.25 -$1.50 -3.59%
Superior Surgical SGC-AMEX $14 -$0.50 -3.45%
Florida Progress FPC-NYSE $31.625 -$1.125 -3.44%
Kaydon Corp KDN-NYSE $29.75 -$1 -3.25%
Aerosonic Corp AIM-AMEX $9.875 -$0.25 -2.47%
Shells Restaurants SHLL-NASD $11.25 -$0.25 -2.17%
Echelon Int'l EIN-NYSE $24 -$0.50 -2.04%
JLM Industries JLMI-NASD $12.25 -$0.25 -2.00%
MTL Inc. MTLI-NASD $26.75 -$0.50 -1.83%
C.H. Heist HST-AMEX $7 -$0.125 -1.75%
JumboSports JSI-NYSE $3.50 -$0.0625 -1.75%
TECO Energy TE-NYSE $24 -$0.375 -1.54%
Tech Force TFRC-NASD $8.875 -$0.125 -1.39%
Republic Bancshares REPB-NASD $25.875 -$0.25 -0.96%
Paradise Inc PARF-NASD $11 -$0.0625 -0.56%
Sterile Recoveries STRC-NASD $15.125 -$0.00 unch.
Thermacell Tech VCLL-NASD $4.9375 -$0.00 unch.
Transcor Waste Svcs TRCW-NASD $3.125 -$0.00 unch.
Parts Source ACEP-NASD $3.50 +$0.0625 +1.82%
Pages Inc PAGZ-NASD $2.25 +$0.0625 +2.86%