Here's what I'm doing . . .
Here's what I'm doing: John Laine
Marketplace presents "Here's What I'm Doing," a series asking people from all walks of life how they're coping with the financial crisis. In this edition, investor and real estate developer John Laine.
People walk past a Washington Mutual bank in Seattle (Robert Giroux/Getty Images)
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Tess Vigeland:When volatility is the new normal on Wall Street -- down 700 points one day, up 500 the next, down 800 a week later -- the first instinct might be to take your money and run.
Well, in this edition of "What are you doing?," we hear the optimists' approach.
John Laine: My name is John Laine. I live in Vancouver, WA. I've been kind of dabbling in the stock market. I've never done it before. It's been pretty exciting.
I started about a month and a half ago. I started buying up what other people would consider crazy stocks, but I'm having a blast and doing OK at it. Fannie Mae, Freddie Mac, AIG -- these are fundamentally sound companies with flawed business strategies. I think they're going to be solvent again. WaMu, Lehman Brothers and IndyMac are just calling like sirens to me.
If you went out and bought 5,000 shares of WaMu, it would cost you $200. If it hit a five-year high, that's $229,000. I've spent 943 bucks. You know, it's not a lot of money, but I own 625 shares of blue chip stock -- blue chips that have turned into cow chips recently.
This is probably not good advice to normal people. You know, it's a gamble. I mean, my wife's calling them a lottery ticket, but it seemed like a pretty good gamble to me.
Comments
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From St. Paul, MN, 12/06/2008
Civil. Good morning. Brief. We are all screwed. Relevant. Make money. Be happy. Good luck.
Jack Goldman
From St. Paul, MN, 12/06/2008
The college graduates and government employees are trying to pump up their dying and beloved stock market to bring it back to life. It was a huge mistake to tie the future of America to New York City bankers in 401k's, mortgages, and GM retirement funds. Owning your own business is better than having New York City steal from your account every night to pay their fees. The Ponzi scheme of stocks is doomed to failure for the average American employee.
The fake money, currency debasement, income taxes, public debt is all doomed to collapse. I just don't know when. When I say collapse, I mean losing buying power. The dollar has lost 90% of it's buying power since 1971. The stock market has made no progress in ten years. This is a financial disaster regarding buying power. Still, Americans are well off and can afford to lose 50% of their assets and still do well.
There will be winners and losers. Winners love wars. Losers hate wars. The majority of Americans and world players are losing buying power with fake paper money. What to do?
Get out of debt. Buy gold bullion you can hold. Own good hand tools. Walk. Ride a bicycle. Learn how to cook cheap nutritious meals. Cut all monthly fees where you get nothing for the money. That means cable TV, internet access, health clubs, and so on. Have friends over. Network. Get in shape. Get out of debt. Always trust everyone to do what is best for them when they say "trust me". No one cares more about your debt, your health, your security, than you do. Government does not solve problems, it redistributes wealth, always stealing from someone.
Everything our parents told us about frugality, money, jobs, drugs, sex, rock and roll, were true. Why didn't we listen? We wanted to change. We wanted to have fun, fun, fun, for me, me, me. I am speaking of the liberated baby boomers and their service sector do nothing economy. The sad thing is hard working people are getting screwed by affirmative action and globalism while bad people that consume and destroy wealth, like CEO's, government employees, and bankers, are stealing billions from good people.
Capitalism has failed America temporarily, maybe permanently. Government is now picking winners and losers instead of the market place with AIG, Lehmans, GM, Ford, and so on. How can oil be worth $140 a barrel one month and 45$ a barrel two months later when consumption is almost constant? This is rampant speculation based on computers and fake paper money. The stock market is also rampant speculation by cheerleaders of New York City. I love New York City, with limits, always with limits.
This is not capitalism. This is New York City speculators raping main street and the world. This is not good people working hard. This is bad people using fake money to steal from good hard working people when Main Street has to bail out Wall Street. The stock market is a rigged game. All the stocks of all the world go up or down the same every day, joined at the hips and lips, unless they go bankrupt? It's a fake money, losers game. You can't win. We were suckered in. The stock market is a secret rigged game. It's heads I win. Tails you lose. How can you win at that?
I was a millionaire but no more. Stocks are down. Real estate is down. Everything is down. That means it's a money problem, a weakening currency, when all things go down. We have been chumped with fake paper money.
Say hello to the new boss (Obama), same as the old boss (Bush, Clinton, Bush). Changing drivers in a broken down car is not change. Changing CEO's in a broken down business is not change. There are four things that will not change without a total collapse of the existing system.
We will have unlimited currency debasement causing rising prices, unlimited income taxes, unlimited public debt, and unlimited subsidies for racist Zionists in Israel.
Obama is the same old wine in a brand new bottle. I am 80% in cash, 10% in gold stocks, and 10% in S&P 500 index fund. I am 50/50 in real estate and paper. I believe 70 million retiring baby boomers and 50 million immigrants will be more than the system can handle. It will collapse (currency will lose buying power).
Expect to see social security means tested and medicaid and medicare wiped out. I would not rule out riots and revolution in large cities (same as what happened in the 1960's. The numbers don't work. Expect declining buying power as people have more and more money, pay more and more taxes, and it will buy less and less stuff they need. Rice and beans actually taste pretty good. Walking can be fun.
The next ten years will be just like the last fifty. The public debt in America has been expanded at 8% a year for one hundred years. Check it out on line. It's paid interest only, selling our children into debt slavery to New York City banks. The Federal Reserve Bank is not Federal, is not a bank, and has no reserves. The Federal Reserve is taking over the American tax payer through the US Treasury, never before done, with this bail out of New York City banks. Real people who make real cars in Detroit are humiliated by politicians who are moochers and looters. The New York City banks are given 8 Trillion in loans and guarantees, no questions asked? It's a financial crime against humanity.
We have met the enemy and he is us, our own fears and desires and stupidity. We deserve what we have gotten. As we sow, so shall we reap. What's new? Protect yourself. No one else can or will.
Good luck to us all. We're gonna need it.
Jack Goldman.
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