Dec

7

 For years I have been an investor, always trying to see the positive and believing that free enterprise and capitalism is the path to prosperity. Work hard, save your money and invest in the stock market. I also believed that owning a beautiful home was a good investment as well. There was a time when America was the envy of the world. Now we are the fool. Our financial system as we know it is gone. Lehman, Bear Stearns, AIG, Fannie and Freddie, Merrill Lynch… gone. Citigroup would fail if not for the bailouts and the great Goldman reduced to a bank. Record layoffs, record foreclosures and trillions of dollars in 401(k) plans and savings wiped out in a year. Millions of lives have been destroyed. Why would anyone want to invest in this country that provides no healthcare, where the states are mostly bankrupt themselves and asking for money and can’t even make their unemployment payments to 10 million unemployed, where a bank will kick a family out in the street because a man lost his job and fell behind on a loan payment? We are the laughingstock of the world. Perhaps the market will rebound but why in G_d’s name anyone would want to invest in this country is a mystery. Substantial damage has been done and it will take years for confidence to return. Why leave your hard-earned dollars in a retirement account that can lose 6% in less than half an hour? Why buy a house that can lose 50% of its value in a year and then risk losing your downpayment and foreclosure when the average shelf life of a job is only three years? An elephant stampede Lobagola into stocks? Makes perfect sense — elephants have poor eyesight and fail to see what is immediately in front of them. In spite of the impressive Friday reversal and clearing of the 20 day moving average and IBD conviction that we are in a confirmed rally, this market isn’t finished until everyone is wiped out. They say the market foresees the future and rises six months in advance of a recovery. Who among us believes that the economy will recover six months from today? We are truly in uncharted waters and a drop of 40% from this level on the S&P would take us to the 50 year long term trendline. Perhaps then the risk reward ratio will favor investing in a country that doesn’t take care of its own people.


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