Catching the falling knife

I said a few weeks ago that I expected the DJIA to bottom around 8000 as that would be about a 40% drop from its high water mark.

Well, this morning, it dropped to 8000, and then started to halt and hold around that line.

We'll see if I turned out to be correct after all and if I managed to predict this bottom like I did eight years ago with the NASDAQ - I had thought it would stop around 2,000 after the tech crash (which began in 2000 when I was still at Salomon Smith Barney) and it bottomed near that level a few months after I left the firm.

Jim Cramer's referred to calling a bottom as catching a falling knife, and that's it's best not to try. Since he also suggested buying Lehman and Bear Stearns days before he went belly-up, I'm ignoring him. HE can be the fear-monger, but I'd rather follow a Buffett who is buying up nearly every share of stock he can - not just Goldman, but a lot more.

I hope I'm right again, and not just for the sake of my ego. Once again, I also wish I had the roll to capitalize on my theory and start dipping my toes in with BAC (20) JPM (35) and C (12) If I'd had anything to invest, all three of those would have fired this morning after the (hopefully) last of the thundering heard began a massive selloff this morning (600 points, which has now almost been entirely recovered just in the time I've written this post).

Too bad I've spent all my money on booze and hobo hunting.

UPDATE #1: 10:30, and all 700 points have been made up.

UPDATE #2: 11:00: Apparently Hugh Hewitt agrees with me too. Looks like we had the same urge and idea and the same time, though I won by just a couple minutes.

UPDATE #3: CNN, as well. Most of their panel also thinks it's time to but more equity positions, with several indicating it's time to start dipping into larger banks. A couple suggested bonds, a couple suggested international markets, and one suggested chocolate, but most seemed to share my position - which could also be a bad sign.