Watch What The Rich People Do!

I'm sure that just about everyone who has read anything about investing has heard the expression, "If you want to be rich, watch what the poor people do and don't do it." While a simple truth in itself, the other side of the coin is just as valid, you need to also watch what the rich people are doing and follow their example. I'm not talking about the people who look rich but are up to their eyeballs in debt, I'm talking about the truly wealthy.

If you've kept up with the financial news lately, you'd think that everything is falling apart and there's no real hope for a stock market recovery. But what are the truly rich people doing? You can rest assured they are not sitting on the sidelines. With some of our nations best corporations selling at share prices well below a year ago, or even 3 months ago, you can bet they are using this opportunity to buy on the cheap. I read recently that Warren Buffet's company just purchased more shares of Kraft and Wells Fargo, both great companies selling at unbelievably low prices right now. I haven't read much about Bill Gate's investing habits, but I think it's probably safe to assume that he's in the buying mode also. After all, you can never be too rich.

Shouldn't it also be a wake up call to all investors in the United States when so many foreign sovereignty funds are beating down our door to buy huge positions in some of our largest companies? I certainly think so. Now is not the time to be faint of heart and follow the heard mentality that is gripping our investment community. Now is the time to buy, buy, buy! Have we reached the bottom? I certainly couldn't say, but one thing I'm sure of. Eventually our economy will recover and the stock market will come roaring back, just as it has in the past. So I'm going to do what the people with the real money are doing and buy everything I can afford while the prices are cheap.