Don't Get Fooled Again! : The Inside Job

The Inside Job (watch free): I didn't want to watch this movie for quite some time maybe had some sort of Post-Traumatic Syndrome like issue with it. Re-living those days, the loss of all that money (ouch). That was a bad time for me and for most Americans (as well as people all over the world), most of us lost 50% for our net worth, countless jobs were lost, world economy went into a depression (why mince words).

Whether you had your head in the sand and didn't know what happened, or you're just like me (PTSD); muster up the courage, watch this. WHY???

Because it's going to happen again! I know you like most are watching the S&P go up for the last couple of years and feeling pretty good about your portfolio's, I know I was, around October 2007. I was completely unprepared, a naive bull, the government had my back, right? Turned out they were clueless too! Only a hand full of people (Peter Schiff, David Einhorn and Nouriel Roubini)  knew this was coming and the same is true now.

Right now, we are living in LaLa Land if you are in stocks. The Fed's QE program has effectively put a floor under stocks. The low interest or free money has to be put to work and thats helping equities, pullbacks are viewed as buying opportunities. And what about bonds, should they not be going up, as FED  is buying bonds. Why were bond prices hammered in the last few months. Why are our foreign creditors dumping our debt (mainly the Chinese) and why did PIMCO dump their stash. 

Not trying to scare you, but prepare you for the coming debt crisis (I posted this 10/25/10), but don't take my word for it see what PIMCO's Bill Gross has to say about it, PIMCO sold out in March 2011. 

MY HEART GOES OUT TO: Retirees, and working class people


These people on fixed income they truly are in a horrible situation. Most of these people played by the rules, worked hard and saved all their lives, invested conservatively, they're getting whacked by inflation and the debasement of the dollar. They are getting hit on any recent fixed income purchases, because yields are so low. And any longer-dated instruments are going to get clobbered if and when bond market sells off further (even if they hold to maturity), the real rates they'll earn at maturity are likely negative considering the current inflation rate.