Cash is king in the worst financial market sell-off in decades – The National

Cash is king in the worst financial market sell-off in decades – The National

Don't plunge into the markets and catch a falling knife, instead preserve your capital, says Peter Cooper. A week ago we saw global stock markets crash, with the 11-year bull market entering history by midweek and the start of a new bear market.. Last Thursday saw the worst day on Wall Street since Black Monday in 1987, albeit the US national emergency declaration on Friday rallied stocks to close markets about 20 per cent down for the week.. We are moving far away from the days of 'buy on the dip'.. Once you realise that, then cutting interest rates like the Federal Reserve and other central banks have been doing is pointless.. Besides trying to force up share prices by lowering the return on savings is bound to fail because interest rates reach zero as the capital risk is so high for the tiny possible returns.. Bond prices move in the opposite direction to yields.. Even with interest rates close to zero your capital is safer in a bank account than in a plunging stock market.. Even then the collateral damage to the global economy this year would have to be overcome.. Six weeks ago China's Hubei province went into