Figuring out when to put your money into the market challenges most investors. Making the decision, sending the buy order, or mailing the check takes certain amounts of courage. And it should! Investors lacking fear face unforeseen surprises. Investors with fear face market events with understanding.

Market tops appear when investors in some sector of the economy get too confident. What Robert J. Shiller labels Irrational Exuberance. Shiller believes that the stock market advances get magnified by “the baby-boom effect, the public infatuation with the Internet, and media interest,” and each faces a correction, an abating that could send stocks spiraling.
Shiller worries, and rightly so, that investors place too much hope in the stock market as their treasure chest for the future. While acknowledging diversification or asset allocation as essential investment components, Robert Shiller warns investors about using the sotkc markets as their only investment choice. For Shiller, it is axiomatic to have your eggs in more than one basket, and he is not referring to stock and bond baskets.

Shiller’s warnings and worries merit attention. ‘You got to know when to hold em, know when to fold em, Know when to walk away and know when to run.”

Read my article, “How to Watch a (Stock Market) Bottom”