The always-insightful James B. Stewart has some sage advice for investors in his his latest Wall Street Journal column (subscription required). He sums it up like this:

Don't fall prey to sharp swings in market sentiment. Stick to a disciplined, long-term approach.

Don't try to bottom-fish in mortgage and housing markets. It's too early.

Don't chase yield. Junk bonds remain especially precarious, in my view. Short- and medium-term certificates of deposit still offer attractive yields, are government-insured and pose little risk to capital.

A key point that he brings up is the issue of visibility in financial stocks and the mortgage markets. As I've pointed out in previous posts, the earnings of investment banks are very, very difficult to understand right now. The mortgage market is impossible to predict.

To use the words of Donald Rumsfeld, we are dealing with a lot of known unknowns -- there are a lot of things we don't know yet and know that we don't know. There may even be some unknown unknowns -- things we think we know but are wrong about.