In Canada Nortel was the darling stock of the tech bubble and remained that way even as it crashed starting in Sept 2000. Canadian retail investors bottom fished with the persistancy of a crack addict needing his next fix. After the first 50% drop it was a "bargin"...another 50% drop made it a "super bargin".....and yet another 50% drop made it a "once in lifetime buying opporunity". I remember this clearly. This went on and on for several months...a classic case of chashing yesterday's winners. No matter how much pain that stock caused, people viewed it as a chance to "buy on the dip". Then it got to the point where the bagholders stopped buying it but didn't want to sell their position unitll there was a rebound. They felt that so long as they didn't sell it wasn't a loss. To this day there are still tons of these Canadian Nortel bagholders who hold Nortel in their accounts with 99%+ losses. I have seen it first hand.
Now take FAZ, which was just pennies from hitting it's all time low today. It is still by far the number 1 ticker tweeted on stocktwits and the number 1 choice of the angry, bloodied bears who are pounding the table claiming that the market MUST crash. FAZ is the Nortel of 2000.
I'm not saying FAZ can't ever have a good run. On it's way down Nortel had some nice bounces but it destroyed so many accounts in the end which FAZ has already done.
Today the market is throwing the FAZ and SRS bagholders a bit of a bone as financials are showing relative weakness. Mabey the market has finally started to listen to all of the yelling, kicking and screaming of the FAZ/SRS bottoming fishing cult. Mabey this is it....finally they hit bottom! At last! Now crash market crash! Do what I say!
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