Are Cheap Stocks Bargains Or Traps?

11/13/2008 05:12 am ET | Updated May 25, 2011

When the stock market goes on sale, smart investors are supposed to seize the opportunity.

But Wall Street's decline of the last three weeks has been so drastic, it has left even veteran money managers too afraid to step up.

Aren't stocks cheap yet? Nearly everyone agrees that, on paper, they are, with major indexes such as the Dow Jones industrials now at five-year lows and down more than 40% from a year ago.

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