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Thursday, November 20, 2008

Hard Times Investing: Update

Holy poop, the markets tanked yet again today! The economy is continuing to deteriorate and jobs are being lost in record numbers; the bailout has not yet fixed a damn thing. Treasury Secretary Henry Paulson had these soothing words “this only happens once or twice every 100 years …” Yeah, Henry, the citizens who have lost their entire life savings will be very glad to hear that. Happy Holidays, and by the way, where is their bailout?

I did my November market buying today, using 66% of my maximum monthly allowable, which is not a full vote of confidence on my part but (for me) a significant sum nonetheless. My next allowable window for trades will be in December. In spite of chest pains, migraines, and night sweats, I’m sticking to my “system,” it evolved over many years, it won’t make me rich, but it probably won’t bankrupt me either. Markets are unpredictable so I prefer a nice conservative set of rules to keep me sane and sober during market highs, lows, and everywhere in between those extremes.

The reasons I was a buyer today:

1) I had my trigger set for when the S&P-500 hit the range of 750.

2) I was thrilled to hear the Democrats acting as Republicans are supposed to by DEMANDING to see a business plan from the Auto giants before there would be any agreement to toss money at them. Way to go Democrats! Too bad Paulson did not require that from the financial institutions before feeding them hundreds of billions of OUR tax dollars.

3) I am still a believer in our country and in our markets. Sometimes you just have to believe when there is no reason left to believe.

4) Even after today’s purchases, roughly 50% of my portfolio is still cash. Cash is the only “hedge fund” that is effective against falling equity markets.

On a somewhat related note, why have I not heard
Jamie Dimon of JPMorgan Chase suggested as a possibility for becoming our next Treasury Secretary? The man is a master at making numbers work, and a master dealmaker. Yo, Obama people, James L. Dimon for Secretary of the Treasury!

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