JP Morgan chief Jamie Dimon summed it up well: "If you are not fearful, you're crazy."
And that sound you hear, with the Dow Jones suffering its biggest drop since 1987, is hedge funds going down the drain. Way too much leverage and the whole thing has the whiff of forced selling. As the New York Times points out, hedge funds are already down 17% and investors are withdrawing billions of dollars. And it's unusual because, as a rule, hedge funds tend not to have bad years. Investors with the big bucks to pour in always assume that hedge funds will do well, whether the year is good or bad. Guess why they're called hedge funds.
But this year is debacle, the worst ever. An analysis by Time magazine reveals that these funds have lost nearly $300 billion due to bad investments in the first nine months of the year.
So much for smart money!
I don’t know why Dimon saying such word. Is Warren Buffett is crazy? I agree that most of the billionaires as well as almost all the investors suffering from huge lose. But, Buffett added another $500 crore at this down time. Is he crazy? No he is the correct investor. In my opinion it is the time to invest in bluechips with a long term look. Valuations are attractive and prices of bluechip stocks are utter down. Why don’t he think in that way?
Sherin
http://investinternals.blogspot.com