Speaking Out
MODEL 1 The stock market is driven by fear and greed.
Chris: Nora!
Nora: Hey Chris. Why the big grin? You look like the cat that swallowed the canary.
Chris: Even better. An uncle I hardly knew passes away and left an inheritance of ＄100,000. So now I’m thinking of making some investments.
Nora: Good idea, thouh it would be more fun if we spent it together. What sort of investment do you have in mind?
Chris: The stock market is looking attractive. It’s been a bear market for several years now, and I think stock prices are pretty depressed.
Nora: The decling market has investors depressed,too.
Chris: But all things work in cycles. A bear market will eventually be followed by a bull market.
Nora: That’s sure. I’ve been reading that investors are coming back to the market, and that will drive up the value of stocks.
Chris: I believe the market is picking up.
Nora: But there’s still a risk. Wars, weather problems—all these impact incestors’ confidence.
Chris: I know what you mean. The stock market is driven by fear snd greed. When investors are cinfident od making of a fortune, they buy—that’s greed at work.
Nora: But along comes something to shake their confidence…
Chris: Like a rise in interest rates, for example, and bingo, they become afraid that they might lose their shares, so they pull out of the market. |