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The Blue Money Report has taken a brief vacation. In it's place, the BlueCollarDollar has published exerpts from it's True/False section. Is performance really what it once was?
The Blue Money Report has taken a brief vacation. In it's place, the BlueCollarDollar has published exerpts from it's True/False section. Also we received a guest submission from Michael Silverstein of the WallStreetPoet who believes that Cash may be the way to go.
In some attempt at finding out where we are, we have developed an outlook about who we are. We look at those with wealth as upper class. We look at those with lower incomes or impoverished as lower class. Because we do not fit either aforementioned category, we think of ourselves as middle class. But that is not an accurate portrayal of America as a classless society. Also, if we are left to our devices, how do we proceed from here?
We had a chance to take a look at what happened in the second quarter in this issue of the Blue Money Report and without looking back too hard, we started to plot a course for the next quarter. We also had a chance to answer a few of your letters.
"...We've had an outbreak of banditry in the executive suite. Those men will go to jail. All is not lost. People need to know this." Do people whose first foray into the world of investing need to know this? Absolutely.
But first things first. We have got to rid ourselves of all this bad feeling about investing. Let's approach it as a wonderful invention.
We found ourselves taking a look back at a week filled with revelations about fraud, the S.E.C. and the Fed, a stock market skidding towards the end of the quarter with much of the same results as the previous quarter, and the investor finding themselves wondering about all of the Tilted Thinking.
Although the separation of consumerism and investing should be clear, we still feel that buying from the homeland is better as an investment than buying abroad. But apparently that perspective is commonplace among other global markets. But this bias could be costing investors in the long run.
Perhaps we are looking at this from an entirely wrong persepctive. Perhaps we are so deeply involved in looking that we are failing to see that there are greater forces at play here than merely fickle markets, stubborn consumers, and greedy CEO's and their ilk. Perhaps living medium is better than living large. Maybe we have become A Blind Horse Knee Deep in Corn.
Not only is the news about the continued bleeding in the equity markets making headlines and the price of gold, the hard asset that resembles the little pig's brick house, is still rising, but the dollar has begun to seep into the conversation as well.
The diagnosis is in. The market is suffering from Global Flu. Also, a number of readers have written in asking what the difference between real estate and the stock market is when compared as an investment. With interest rates remaining low, the questions do merit some thought.
Steve, a clinical psychologist, told me that a surprising amount of folks wander through his door in search of mental health found their benefits had either been drastically cut, or were non-existent. This, he said, was usually a shock to the patient, who was usually under the assumption that they were well covered. Also,when the temper tantrums subside, what will really be left of how business is done?
When Glenn, my neighborhood barber, mentioned he was trying to get out of one his investments, I was walking out of the door. "But I can't", he said. "It's a variable annuity." He made it sound like a some sort of inoperable tumor. Also, these markets are often described, perhaps by habit, as something alive, breathing with its own momentum, moving in some sort of direction. But somewhere, the life blood of what is happening on Wall Street has thinned. And most wonder about the direction, as if understanding is all that is needed to profit.
"Investors need transparency. They need to see the results of the business through a clear glass, not a rose-colored glass, not through a kaleidoscope of unnecessary or misleading complexity, not through the eyes and words of a novelist, but through straight, non-fictional reality. And the words and numbers chosen to be disclosed are of tremendous importance to the investor in predicting future performance. Nothing less will do." Also a look at what FICO is doing to your credit score and we should all be pointing fingers.
I made a whimsical wish to meet Warren Buffet at his annual shareholders meeting but more importantly looked at what he means by intrinsic value and we took a look at the decision to buy bonds or bond funds and whether it depended on your level of sophistication
We want to thank Jason B. Lee for his insightful follow-up on our piece concerning long term care insurance.
At the end of every quarter, and especially at the end of every dismal quarter, we look for some solace in our investment thinking. How do you measure the effort put forth by the mutual fund manager you have hired to take you to retirement? Is it throughabsolute or relative return?
The quarter ended without much fanfare, simply slipping by without much in the way of notice. We take a look at the past quarter from the persepctive of where to go for the next. That and Tom continued to debate the Social Security issue.
It all started with a simple column about Social Security. This made one reader want to respond in earnest, and the debate began.
Who can resist a little guilt. Advertisers do it all of the time, playing your emotions, making you feel as though you are not giving life as much effort as you could. With the advent of the state sponsored 529 savings plan for college, they have marched out guilt by the bucket load. We think that 529 plans need closer consideration. And we have two reasons why.
This past week we took a look at one of the greatest economist that ever lived, Dr. James Tobin. He is credited with a vision that brought economic sight to investing. Also, there is nothing wrong with popularity, but our president is using his to delete your future. A must read for those counting on Social Security.
Nothing remains completely under control. That said, why should inflation slip under the radar and not be an upcoming factor in this economic recovery? And what should the adminstration do to the 401(k)?
Is the recession really over? I'm not so sure. Just because Greenspan changes course, looks happy, and makes pronouncements, that doesn't signal the end of the downturn as we know it. Also, we have taken a look at the glossary of financial definitions, and changed investor and interest to reflect the current thinking.
The Circus returned to Washington with a parade before the Senate, who had know idea, according to Jeffery Skilling, what a chief executive does. For added benefit, the analysts who loved Enron at the top and the bottom, were asked to perform also. Why will this have an effect on Campaign Finance Reform? Greenspan is standing in the middle of the road, and investors are asked, who are you?
A week where Congress held the unemployed hostage for the sake of their stimulus agenda, Team Greenspan entered into the finals of curling against Team Economy, and 401(k) plans finally are showing signs of not being all that they were sold to us as.
A week where economic indicators point to lack of confidence, the new debt, and the government tries to step in a help you help yourself.
Could it be that the wizard, Alan Greenspan, has lost his magic?
What we won't do is tell you who you are.
Are there Profits to be had in Deficits?
"The new year started off with quick attacks by the Democrats on the trillion
plus dollar tax package that Mr. Bush passed shortly after gaining office last
year. You all know how I feel about it."
Learn how it failed the employees at Enron, and is probably failing you also
Jerry's right. The market tends to forget about yesterday. We take a look at your IRA.
Economic Pressure
Are we headed towards an economy with a new kind of pressure... deflationary?
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