Mulp explained this very well. I would like to add (I am a stockbroker) a few things about P/E ratios. There is no law that an equity has to abide by in regards to P/E ratios. P/E ratios are simply a reflection of how much supply and demand traded over actual earnings. Stocks can (and have) made buckets of money and still traded at very low P/E's and stocks have lost buckets of money or made very little and traded at high P/E ratios. Just remember that all investments or mediums of exchange (as in the Dollar Index) are governed by free will of supply and demand. No matter what the circumstances are the dollar can trade low or high and is governed by market forces but not required to follow any set of rules that say if "so and so happens then this HAS to happen". Actually it is the imperfection of the markets that create the opportunity to make or lose money. If markets had to follow a valuation rule then it would be priced perfectly and no opportunity would exist. sidekick, I do not know your risk tolerance or your circumstanes but I can say that any investor needs to understand how to manage risk through the functions of the markets. Using ETF's, put options, writing covered calls etc. you can make money or at least control the bleeding through these investment instruments. If you can only make money in an "up" market you are severely limiting yourself and are at the mercy of the markets. If you want to send me a private message I will elaborate if you want me to and assist you any way I can-for free. The markets have been my passion since I was 11 years old (I am now 48) and I can save you a lot of pain by sharing my experience. I have learned a lot more by my mistakes than anything. But one thing I have managed to do is take a lot of the "guesswork" out of investing. DO NOT be greedy is rule #1. Risk management strategies mean you will not eke out the very last dollar of an investment but at least you can take the better (or protect the better) portion of what an investment has to offer. Either way, MULP explained it very well, I just wanted to chime in.

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"oops there goes sanity, oops there goes gravity"

http://www.youtube.com/watch?v=kwhUjFoHwS4

Cottonbroker-formerly known as "the Artist"

But....you din't say whether we should put all our money into gold and silver or LTSF and white, food-grade plastic buckets!

Tokie

your gonna play the metals buy silver on pullbacks and do not chase gold. silver has a lot more upside potential % and silver being not only a store of wealth but an industrial metal that has really not been exploited i would dabble in silver if i was going to dabble in metals, careful.

__________________
"oops there goes sanity, oops there goes gravity"

http://www.youtube.com/watch?v=kwhUjFoHwS4

Cottonbroker-formerly known as "the Artist"

I GOT A LOT OF LEAD.........I cast my own bullets

at times a bullet can be priceless compared to gold ;-)

NOW THAT I THINK ABOUT IT

I'M A LEAD GAZILLIONAIRE

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If you don't KNOW where you come from...you WILL wind up going nowhere.

That goes for Ideas, institutions as well as individuals :-I

http://www.youtube.com/watch?v=nUncnWxjUXM
^You CAN Handle The Truth - TRANCE Form America - 3of7

PSI TECH INVESTIGATIONS and LAW ENFORCEMENT

~777~ "THE AWACS ANGEL CODE"

Whew.

Was worried there...I could see that for a moment...just a moment, you were considering those white, food-grade plastic buckets....


Tokie

Well....actually, casting lead might indeed explain a few things about you duck...

You wanna gamble? You wanna ride the dollar down to China and make $$$ instead of lose it? Sell out of the money call options. Put a GTC order under your strike price as "buystop" on the contract. IF you get dragged into the contract start writing puts until you achieve a "neutral" position. Once you achieve the neutral position reevalute your whole position and sell out of the money puts and calls (the volatile market movement creates this opportunity) and let the time value of the options disentegrate (you are short the options so that is good) and you will make money off the insanity of the marketplace instead of being a victim.

__________________
"oops there goes sanity, oops there goes gravity"

http://www.youtube.com/watch?v=kwhUjFoHwS4

Cottonbroker-formerly known as "the Artist"