Monday, February 25, 2008

Has the Stock market "Jumped the Shark"?

Per the WIKI:

The term jumping the shark alludes to a specific scene in a 1977 episode of the TV series Happy Days when the popular character Arthur "Fonzie" Fonzarelli jumps over a shark while water skiing. The scene was so preposterous that many believed it to be an ill-conceived attempt at reviving the declining ratings of the flagging show. Since then, the phrase has become a colloquialism[1] used by U.S. TV critics and fans to denote the point at which the characters or plot of a TV series veer into a ridiculous, out-of-the-ordinary storyline. Such a show is typically deemed to have passed its peak. Once a show has "jumped the shark" fans sense a noticeable decline in quality or feel the show has undergone too many changes to retain its original charm.

I wonder if this might be the case with the stock market we we have it today?

What do you think?????

I always think in terms of Inflation and Deflation.....but that only talks about prices.....Recession, Depression talk about Economic Conditiions.....

But the term "Stagflation" seems to talk about BOTH conditions of prices (inflation) and Economic Growth (Stagnation)

I never think of Stagflation as a possibility.....though i remember it being the norm back a few years ago....was that maybe 1974?

We had rising prices and falling j0bs and economic output. This seems quite possible to me now because I see the dollar being devalued (causing rising prices) which will then cause us to buy less. (as we see happening with rising gas prices right now)

Our economic output is measured by our purchases.....and 70% of that is personal I suspect economic output will be going down.

What to do with investment money.....hmmm....I don't have a crystal ball. I sure wish I did.

Interesting, I am going to look at the "Big Mac Index" of economic vitality, and then the "Big Golden Arches Theory of Conflict Prevention". (simply stated that "No two countries that both had McDonald's had fought a war against each other since each got its McDonald's".)

Confess your Money sins...the next step in Social Networking?

I was reading this YAHOO article on finance and how there are sites starting up to let people "confess their financial sins" online in a WEB 2.0 manner......via a social networking site of course!

Take GEEZEO as an example....It talks about being a site that makes it easy to track your finances...but it looks like a place to confess your "sins" least those of finance.
(more than just GREED I suppose)

Then there is MYVESTA.US which seems to say that it is a site to discuss personal finance assistance.....I have not looked around there much, but the article says it has a "confessional" of sorts for finance fopars.

Then lastly there is which seems to be more than for just finances......but a "full service" confessional for all your excesses!

I somehow think this will be a big hit....I mean people LOVE to see how others fail. Just look at how many rubber-neckers there are at a car accident, or when a police car pulls someone over. People seem to love to look out for the train wreck.....

PS: Per the article.....the article give a warning specifically for us Catholics:

Those Catholics wishing to absolve themselves via their computers should however be forewarned. In 2001, the Vatican said "no" to online confessions, as they lack the personal touch needed to provide the full benefit of the sacrament.

Oh...I'm not going to rush to use these sites, but I suspect many will.....especially the last one. I only wish I had invented it myself!

Sunday, February 24, 2008

Oh no...people have found another way to mortgage the future......desolving their 401K!

I see the stock bubble in 2000 didn't teach people anything about their 401K......perhaps it desensitized them to the risk of losing because we seem to have "made back" many of the losses of those dark days. (errr.....except for some of us Tech investors)

Well, it looks as though "tapping" our houses for a quick "fix" of cash has now been replaced by tapping our 401K's. (for some people)

Let's hope this isn't a trend.....I mean that we are systematically ruining all our savings options.

I mean some of us were hoping out homes held some value we could tap during retirement.....there is a chance that that value could go up in smoke if house prices continue to fall. (especially with people going "upside-down" on their mortages)

Say a prayer for sanity.......

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Sunday, February 17, 2008

I find it interesting to read about the Great Depression of 1929

The graphic above seems like a pretty good synopsis of some of the factors-results, before-during and after the Depression.

I'm sure nothing is as simple as it seems in hind-sight. I say this because as I look at the economic situation today...I see quite a number of parallels too the Great Depression.....but are reminded that I saw similar things back in the early part of this century. ( is still early.....but I'm referring to back when the stock market crashed.)

I have since learned that our economy us massive, complex, and quite resilient. Like a living being, it has quite a desire to remain healthy and alive....and all by itself it has many defense mechanisms that kick-in.

Some of these defenses are brutal to us individuals in the failures, company layoffs.....all kinds of things that happen to "save the patient".

Some already see the handwriting on the wall....but I have not quite come the the conclusion that our economic goose is quite cooked.....but I would not at all be surprised if I woke up one day and found panic in the streets with people making a run on banks or perhaps more likely on our 401K accounts.

But than again....I don't think we can withdraw from life because of this fear. This is life, and unless we subscribe to the alternative (death) we will have to face it all.

Now, I'm not saying we shouldn't prepare in some ways.....for sure...diversify, save, "have things instead of money", stay out of debt....stuff like that I suppose.

But in the end, life is here to be enjoy it. (just don't go into debt to do that)

Saturday, February 02, 2008

The Economy Continues to Fall -YET- The Market Continues to Rise.....

Hmmm.......what;s up with this Stock Market. It actually makes less sense to me than the market in 2000.

I mean back then the news on the companies people were investing in was lousy.....that is, no profits in sight.....but the basic economy was sort of going along OK.

I mean all the problems we have today with debt and foreign trade were in existence....just not in as bad a shape as we have today.

But today, employment numbers went down, savings rates are negative, trade imbalance is wicked, housing sales are in the toilet, house prices are down, bankruptcies are up, new home construction is down, the dollar is losing value, the federal reserve has lowered rates twice in two weeks to keep the economy from flushing down the toilet, and we are exporting all our jobs.......and our politicians are trying to jump-start it all by adding more debt to the government so that we can go out and buy junk to pup up the economy or about a week.

What a mess.

We should be working to create long term solutions.....but instead, we will just give away money (print it) and make everyone feel better so they don't yank their money from 401Ks.

But in the face of all this....the stock market is rising. What is wrong with this picture?

Is this an indication that we are all going mad.......or is there something else at work here? What gives?

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