Local analysts see fear, opportunities

The sharp decline in stock prices Monday has renewed concerns locally that the economy could be dragged into a second recession.

Investors remain worried about the sluggish economy and fear markets would continue to decline as they did during the financial crisis in 2008, financial analysts said.

"It felt like panic selling from November 2008 and 2009," said Stephen Johnson of Raymond James Financial Services Inc. "There was a lot of fear ... we could be dragged into a second recession."

Johnson said that the big drop also creates opportunities.

"At some point the stock market will hit bottom," he said, "but it's a tough call to say when it will."

John Futrell, owner of Futrell Financial Management Inc. in Las Vegas, said margin calls added to the snowball effect of the markets' decline. He said losses early in the day triggered an increase in calls, forcing investors to meet their margins or sell.

He said for the average investor with a 401(k) plan, "the simple plan is to buy low and sell high. With some companies, the lower they go, the more attractive they become."

Greg Phelps, a certified financial adviser with Red Rock Wealth Management, argued Monday's decline was normal and expected after "a 93 percent increase inside of two years."

"You can't wish away the declines," he said. "You have to make sure your retirement plan is solid, and you've got to expect some rocky roads along the way."

Contact reporter Chris Sieroty at csieroty@reviewjournal.com or 702-477-3893.