http://www.clusterstock.com/2008/10/cramer-panic-now-and-sell-everything

Excerpt:
"For what it's worth, we agree that the market will likely go lower over the next year. We also agree that people should not have any money in the stock market that they need in the next five years. But the point is that "those assets" never should have been in the market in the first place. The stock market is always unpredictable and dangerous over such timeframes, and people should never count on it to fund near-term expenditures.

We also couldn't disagree more with Cramer's recommended strategy of suddenly selling everything now, with the market down 30%+ from the peak. This is market-timing at its worst. Adjusting your long-term investment strategy because you've realized that you can't stomach risk is one thing. Panicking and selling because the global economy and markets are temporarily collapsing is another. After more than a decade of being overvalued, stocks are finally approaching fair value, and, time and again, emotional selling based on market conditions has been shown to be a terrible investment strategy.

For those with horizons of a decade or more, moreover, the current crash is actually good news. If you're saving for retirement, you will do best if stocks crater like this and then stay down for a decade. The dividend-reinvestment will make you continually buy more shares at lower prices, and when the market does eventually recover, your gains will be compounded."

One thing I've wondered about for quite a while: I was told many years ago: "Never invest anything in the stock market that you can't afford to lose". But all those IRAs are invested in the stock market, and there's no guarantee that the people making the decisions on them know what they're doing.

Isn't there something better to invest in? Diamonds, gold, real estate?

Sue

Real estate? Good time to buy now, disastrous time to sell. Gold and diamonds? Security issues, and lack of intrinsic value: society values them, but they are not usually in your PSK because of intrinsic value.

The stock market is the only investment medium that consistently stays ahead of inflation. Investment of assets, like everything else in life, is a gamble. Market is a good long term bet, lousy short term bet. Alternatively, you can take your money to the pony track, bet the favorite to show, and make 7-10% over the medium term. And you get to watch the horses. Which is great if you like horses. Which I do not. Personal favorite: invest in chocolate. It has appreciated in value steadily, and if the bottom falls out of the economy, you can eat it. Chocolate will get you through times of scarce money better than money will get you through times of scarce chocolate.

I'm still trying to find a tax lawyer who can put my fantasy football league inside a Roth IRA. Still working on it. I'm dollar cost averaging into the office pool about who makes it through Dancing With the Stars, too. Should be able to retire in...well, I'll need to get back to you on that. With Misty May's ankle problem...I'll need to rejigger my position somewhat...

Sue, Izzy's comment just about sums it up. At any given time, something is doing well, whether it's stock, gold, Tickle Me Elmo's or whatever. Too bad no one can reliably pick the winners before they go up.

Even over the long-term, I'm beginning to wonder about stocks. Even over really long periods of time, when you look at countries like Japan, you have to wonder. Remember when everyone was afraid of Japan, Inc.? Remember when people thought that the Japanese might literally buy the whole country out from under us? Does anyone remember the peak of the Nikkei stock index? 39,000 in 1989. What was today's close? 10,000. Japan's stock market has never been close to getting back to even since 1989, and their economy is still lackadaisical to this day. Similar to our problem right now, they had assets that became way overinflated in value, like real estate, but that bubble finally popped. I don't know--harbinger of things to come?

And another thing has been bugging me for the past couple months. I finally got around to reading Kunstler's The Long Emergency. When you look at these charts of stock market performance, they go back pretty far, like the late 1800's. But they really only go as far back as the discovery of oil in this country--plentiful, cheap oil to power a young, booming, rapidly industrializing country. What happens when oil is neither cheap nor plentiful? Can we expect the same economic performance going forward? To be honest, I'm starting to wonder since I read that book. Thinking about our infrastructure, our foreign policy, where our food and daily goods come from, I realize how utterly and completely dependent we are on cheap oil.

China's meteoric rise could be hamstrung by the fact that they have finally started developing in the latter half of the Age of Oil. Bummer for them.

This is a *really* good time to buy stocks, and that's what I'm doing. I was broke during the 1987 crash, and started saving then for the next one. This time I'm ready.

Two years ago, I might have suggested the Trekkie Monster portfolio, but even that sucks right now. Blasted Facebook. :P

I would say diversify. Military and security stocks, not sure if any of the big property management companies are traded but they aren't a horrible idea. Small scale solar and wind power manufacturers. Water futures if they are being traded yet, but I haven't heard anything. Maybe national and municipal bonds, but don't be afraid to shop outside of the US.

For something more concrete, maybe part of a graveyard or mortuary.

You can have either potential growth or safety with your investments - not both.

9 point investment plan
Summarized:
1. Make a will
2. Pay off your credit cards
3. Get term life insurance if you have a family to support
4. Fund your 401k to the maximum
5. Fund your IRA to the maximum
6. Buy a house if you want to live in a house and can afford it
7. Put six months worth of expenses in a money-market account
8. Take whatever money is left over and invest 70% in a stock index fund and 30% in a bond fund through any discount broker and never touch it until retirement
9. If any of this confuses you, or you have something special going on (retirement, college planning, tax issues), hire a fee-based financial planner, not one who charges a percentage of your portfolio

It seems to me that Cramer's advice is about 6 - 12 months late. I have to wonder about his credibility when his timing is this far off.

IMO, which is worthless concerning financial matters.

As long as you beat the rate of inflation plus a little more, it doesn't matter what you invest in. If you're looking for safer stocks, its good to remember what people always need. Hygiene/medical products, core household cleaning items, energy, etc. and research companies based on who makes what, brand, and market share. And of course look at 52 week hi/low, P&L, etc. (moral judgements aside and with a hint of cynicism) This is generally true, but especially in desperate times, alcohol and tobacco are steady sellers.