I’ve been sitting in cash for a little while now and I still don’t feel like buying anything. It is interesting to see how the economic woes are playing out in the media and among economists, especially after listening to my finance professor talk about the intricacies of pre-recession statistics. The unemployment numbers that came out Friday, leading to big losses in even the strongest stocks, showed a 0.3% increase in unemployment, the biggest since 2001 or so.
The problem for me is that there’s no next Nintendo. I would be tempted to get back in if it took a big enough hit, but it’s not like Nintendo is looking to push a lot of different products out in the future. Gaming doesn’t work like that — systems come out once every half-decade or so. For that reason I’d be more tempted to buy Apple, which is probably the strongest looking stock out there right now. Apple releases new products pretty frequently — products that compel people to discard the old product they used to have — at a hefty price.
That they are concentrating on handheld devices that actually are useful (as opposed to Palm) is profitable because desktop/laptop markets are dead as is. We’re seeing the miniaturization of the computer into a convergent device that acts as a remote client to the major supercomputer that is the Internet. Processing power is being off-loaded onto the net.
It still blows my mind that people aren’t talking about things in those terms yet. Perhaps that’s a major business opportunity — appropriate since I’m about to start my social entrepreneurship class. I’m convinced that I can make a shitload of money there somewhere. However, I am wondering if it will be as a result of my idea or because I run into the right person who has the right idea.
Right now, solar stocks are hot with the daytraders. No doubt I will have to get smarter on other technologies besides Internet stuff if I want to find the next triple-bagger Nintendo stock. That will involve researching alternative energies, biotech, nano, etc. and finding which of those are able to capture the popular imagination…because that’s what seems to make stocks scream.
But for now, I am looking at the market and thinking everything’s too high. A lot of the problems in the economy are on the business-side (financing, employment), and I don’t think it will be over until it starts affecting the consumer-side (sales, consumption habits) as well.