Lee's Dhaba: India: Markets approaching bottom...redux

There is no good news out there...it is bad and getting worse. The following quote captures the right mind-set for an investor...in this environment of gloom it is difficult to concentrate and get beyond the cacophony of doom:

“Fortunately, one of the most valuable lessons of my career came in the early 1970s, when I learned about the three stages of a bull market: The first, when a few forward-looking people begin to believe things will get better. The second, when most investors realize improvement is actually underway. And third, when everyone’s sure things will get better forever. Buying during the first stage can be highly profitable, while buying during the last will carry you over the cliff with the rest of the herd.

“To aid in your consideration of the future, I’ve formulated the converse of the above, the three stages of a bear market: [First] When just a few prudent investors recognize that despite the prevailing bullishness, things won’t always be rosy. [Second] When most investors recognize things are deteriorating. And, [Third] When everyone’s convinced things can only get worse. Certainly we are [currently] well into the second of these three stages. . . . One of these days, though, we will reach the third stage, and the herd will give up on there being a solution. And unless the financial world really does end, we’re likely to encounter the investment opportunity of a lifetime. Major bottoms occur when everyone forgets that the tide also comes in. Those are the times we live for.”

So here is a potpourri of Bad News:

Wall Street losses steepen as Paulson unveils plan to not buy distress bank assets
-this is good news