Aug

17

HurricaneThe National Weather Service has issued many different models for Tropical Storm (soon to be Hurricane) Fay, most of which head in my direction, right on top of my head. The expert meteorologists say that the storm will make landfall on Tuesday, somewhere between Ft. Myers and Tampa, with my neighborhood right in the middle. Since I've been through this a few times, I know the drill. This morning I shuttered my house in about 90 minutes. Since I have a long term view of being prepared for an emergency, our generator is topped off, we have food and water for 35 days, and we don't have to panic. I ran over to the grocery store this morning for some donuts, and saw the madding crowd. Everyone was stripping the shelves, buying all the water, batteries, and staple items like there was no tomorrow. Tempers were flaring and people were pushing and shoving, much like the guys in the wheat pit when some bad news comes out. I'm sure that Lowe's and Home Depot are experiencing the same thing with plywood for windows. Preparedness for a hurricane is similar to preparing for a market event. Have a plan, stick to it, and modify it as conditions require. One can ensure personal safety through proper planning, much as one can reduce market losses through proper planning. Our plan is to always have on hand enough supplies to get through any disruption in the supply chain. One thing about a catastrophic event in nature or the market, once the damage has been done, the growth can resume. Four years ago, Hurricane Charlie missed us by a mere 30 miles. The beachfront residents to the south of me were 60% wiped out. Today, that area is back, bigger and better than ever. Markets in 1907-08, 1929, 1932, 1972, 1987, 2001-02 were all catastrophic events in those times, and all more than recovered, completely. Nature, like the markets, sometimes must wash things away so growth can continue. Nature and the markets both deserve respect because if taken lightly, they can do serious damage to your health and your bankroll.


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  1. steve leslie on August 17, 2008 1:29 pm

    I lost practically everything in 2004 when the first hurricane through tore off my roof my back porch and had water damage to the whole interior of my home. Three weeks later a second hurricane came through and completed the rest of the damage.

    Lesson one: Bear markets are horrible and brutal. They are no respecter of persons.

    People who die do so from drowning:

    Lesson 2: It is not what you planned for that will kill you but what you did not plan for.

    Wind and water are unstoppable . Once it starts it does not end soon enough and there is absolutely nothing you can do to stem the tide.

    lesson 3: Markets can remain irrational longer than you can remain solvent.

    Gasoline and money are critical since the power will be out and ATM's and pumps will not work.

    Lesson 4: cash is king and commodities are queen

    Escape routes can be hampered due to high traffic.

    Lesson 5: People run in herds.

    Local police, fire and public employees are overwhelmed with work.

    Lesson 6: Don't rely on local government or state government to assist you in your time of woe.

    FEMA is quick to the scene but slow to respond.

    Lesson 7: Federal Government is not the solution to your problem.

    Insurance adjusters work for the company they represent. Your insurance policy may not cover what you thought it did.

    Lesson 8: Do not trust private industry more than you need to. And always verify.

    Water damage destroys paper:

    Lesson 9: Have a financial plan, a trust and a business continuation plan. Keep it all in a safe place for easy access and let people know where that is. Safety boxes at banks work very well.

    You neighbor is going to have the same and similar problems as you will.

    Lesson 10: Forge bonds with those who might be able to assist you in times of crisis. Learn to work well with others. Be sensitive to the trials that others are going through.

    I hope this is helpful and instructional.

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