Investing wisely

Recently I was watching a video on forbes.com, which featured billionaire Ron Baron who is also listed as number 306 among the Forbes 400 richest people in the world. In the interview, Ron said: 'save and invest, and invest and save, in small and mid cap companies and invest in businesses who believe in investing and saving'. He also asked not to judge people and businesses, and have faith in other's business and their foresight. 'Build a brand', is what Ron says. Building a brand is possible with repetitive advertising and also maintaining that brand. He thinks stocks are cheap now when compared to 12 years earlier, because people are afraid to invest. Bonds are also favorable long term investments according to him.

So if you decide to invest in long-term, tips from Ron Baron could be very useful.

Liquidity problem still prevails

Financial Markets are still facing liquidity problem. The U.S. Federal Reserve is trying it's best to maintain confidence among investors by cutting interest rates on the borrowing loans given to banks. Due to interest rate cuts government securities have risen giving a safe investment option compared to the volatile equity markets. Rising bonds have still not brought any respite to the weakening dollar, which has weakened against the euro, the yen and the pound. The fall in dollar price has effected the commodities too, at one time these were traded to hedge against equity risk but now the commodities cannot go any higher as a correction was going to happen and now it has. Oil and Gold are overvalued and they are bound to go down. Not a good time to buy gold. The Federal Reserve needs to come up with a very good plan to bring some confidence back into the markets. But one thing is sure that this credit loss crisis is far from getting over, it will continue in the next year too, unless there is a miracle.