Friday, September 14, 2007 - "Stick This Somewhere Special"

"Stick This Somewhere Special"

I need to clear something up. Right up front. And, I hope you'll print this out and keep it somewhere near your monitor.

"I am not a 'bull'. I am not a 'bear'. I understand the terms 'bull' and 'bear' are phony constructs designed to divide people into two 'black and white' camps when the only camp to be a member of is neither. I buy stock when I want. I sell stock when I want. Also, I am not 'the consumer'. I am not addicted to unwise investments in unnecessary items for my home, family, or business. I believe that debt will keep me enslaved to banks, corporate America, and the government. Therefore, I will do what I can to remove debt from my life. I understand that wall street and the mainstream media job is is to steal my money. They are professional thieves who use tactics which include lies, manipulation of and distortion of 'news'. My job is to disregard these attempts to sway me from my job. My job is to make profits each day for my family and for myself. For, I am a patriot in the truest sense of the word: When I am strong, debt-free, and able to think clearly, without fear, I am able do what's needed for my family and my country."

Okay, now, print that out and stick it somewhere.

Wait, you think I wrote that about me? No. That's for you to read, recite, and live by every day. See, that's my credo. Now, make it yours.

"Questions With Answers"

You may notice that there is a decidely 'bullish' (to use wall street lingo) tone to the markets. The last week's cheerleading sessions on CNBC were top-notch work. I have still not heard one "analyst" or CNBC cast member come out even ask the question, "Is it time to sell your stocks?"

Now, lest you consider me a 'perma bear' (another bit of wall street lingo), understand this: It IS time to at least ASK THE QUESTION about your stocks. Asking questions is healthy, wise, and not a sign of a pre-determined bias.

Alas, 'the question' remains unasked.

Shoot, if you watched "(Fast/On The/Real/Your/Mad) Money" any day this last week, you witnessed a steady stream of "analysts" who say two things: 1) 'the fed' will lower interest rates, and 2) the lowered rates will drive the market higher.

You did not see anything close to an opposing view or counterpoint to these assertions.

This is not a healthy sign. Forget whether you believe the market is about to tank or soar. There is, ahem, at least a debate you should be privy to over whether it's a good time to buy stocks at near record levels under ANY circumstance.

Since the mainstream media won't ask the questions, and wall street pretends the "only question" to ask is, "how many shares can I buy", I'll pose a few questions to you:

1. If the US economy and GDP rose on the back of a marvelous housing market, AND, 'home owners' (see below for more on the mythical 'home owner') got super duper wealthy because 'their' home values and equity skyrocketed, AND that's where 'the consumer' got all the cash to buy stuff from 2003 to 2007, AND GDP is 70% 'consumer spending', AND now all that kick-ass wealth is gone out of the housing market, and 'the consumer' can't pull any more 'equity' out of 'their' home to spend it down at Wal-Mart.... WHAT is going to prop up the economy from 2007 to 2011 (the next 4 years)?
2. What happened to all the 'private equity' deals? Wasn't 'private equity' what was going to prop up the market this year? Remember all the talk about how "...even if 'the consumer' slows down, 'private equity' will save the day because valuations are so cheap at 'these levels'..."? What happened? When was the last "private equity" deal you heard about? (Note: We now know that all that "private equity" money was BORROWED money from banks that now are not in the mood to lend.")
3. When will a falling dollar matter? When the dollar was strong it was used to indicate the amazing strength of our economy. The US was a pillar of economic strength, right? Okay, well, now, what about near-historic lows versus most major currencies? At what point does a weak dollar matter to the market as much as a strong dollar mattered on the way up?
4. What about the price of oil? How long will we be asked to believe that all-time highs on the price of the one commodity to which our economy is addicted and unable to live without, will not have an impact on 'the consumer'? When will the price of oil matter again? If 'the consumer' has to spend more on the gas it takes to get to Wal-Mart, when will that impact the money 'the consumer' spends on the lead-painted, poison-tainted, plastic junk from China he or she buys at Wal-Mart?

These are just some questions you need to ponder. I could give you the answers, but, gee whiz, I'd rather you think for yourself. If you're a "bull", you might not care about these questions. If you're a "bear" you might have said, "no kidding!" while you read them. If you're smart, though, you'll simply ask the questions and look for the answers.

"People aren't Smart"

How about those Ditech commercials? You know the ones. The ones that start with, "People are smart."

See, Ditech uses the same technique politicians use when they say, "The American people are smarter than that."

The truth in both cases is this: If you believe that "People are smart", and, you believe it applies to you, and, it makes you pick up the phone to call Ditech, then...

You ain't real smart.

If you were "smart" you would not need to refinance your home in the first place.

On that note...

Enjoy your day and tell a friend about what I do, please. Your support with a simple forward of this email to a few friends allows me to keep spreading the truth.