Time to Rebalance

So I did a quick inventory of my assets this weekend.  As I've written in this blog before, I'm very heavily weighted toward cash right now.  I stopped buying stocks about a year ago because I was sure the market was overpriced and did not want to buy at the top of the market.  I'm looking like a genius right about now with that call.

However, I'm now way too overweight in cash at this point.  If you add up all my non-retirement assets, I'm about  77% in cash and the rest in equities (I don't own any bonds or bond funds). For someone my age, this is a pretty silly to be this far into cash, even if you are as bearish as I am.  I am still not ready to jump totally into this market, I do think there is probably some more room to the downside, but I definitely should not have this much cash on hand.  Some of this has been caused by the shrinking value of my equity portfolio.  I'm probably down at least 40% over the last year or two.  But most of it is simply staying on the sidelines and continuously earning more money which just turns into cash in my savings account.  Yes I know, its a nice problem to have.

So I need to start looking very hard at my shopping list.   There are some things that are extremely interesting to me at the current prices.  There are some things that are extremely scary too.  For example.  Goldman Sachs.  I thought it was a buy if it were to ever hit $120, and now that stock is trading close to $60.  Was I right before, or is this stock going down even more?  In this market, it is extremely hard to say.  That's why I won't deploy all that cash, probably just a third of it over the next few weeks.  If the market becomes more stable, I might look to divest another third of the cash.  Not sure if I will deploy that last third anytime soon unless I really think the market gets into bull mode, which I honestly don't see happening in the next few years.

So what is the first thing I should buy?  So hard to make a decision right now ...