Beating the Bear Market: Go Contrarian

Yesterday I mentioned that I will be devoting some time to an article written by Paul Farrell for MarketWatch. This article gives 10 things you can do to beat the bear market that has already begun. Today’s first advice is this: Go Contrarian.

Don’t trust Wall Street to make your investing decisions

Farrell points out that Wall Street is very biased:

The vast majority of business, economic and stock-market forecasters are not looking out for your interests. They’re biased, favoring their employers on Wall Street, Corporate America and Washington. The past few years they made huge bucks hyping the credit/subprime bubble. Witness their bonuses. In 2008 their rosy forecasts will continue. They can’t help misleading you, it’s in their DNA: “Greed is good.”

Focus on the fundamentals, rather than on predictions. When the stock market jumps, don’t look for the “hot” item. A bear market is the time to look for solid stocks. They may be low right now, but companies with solid fundamentals and practices will recover. That’s where you need to look.