Stocks are plummeting, the auto industry is on the brink of collapse, Iran almost has the bomb, pirates are attacking, and now it’s even too deadly to flush toilets! What are we to do?
From my point of view, ever since mid-October when the stock market went through its worst week ever and officially redirected public interest away from war in Iraq to the economy, there seems to be no end of ever increasing bad news. The election of a new president seemed to stop fears, but only temporarily. Now it seems like we’re back to counting down the minutes of a doomsday clock worthy of Biblical proportions.
But we can’t just hide under our desks and hope we’ll be fine when this all blows over.
As the economy contracts, one must realize that the way it contracts is not by eliminating excellent businesses or excellent investments. On the contrary, the market is quick to severe the ties of the most unstable and poorly executed businesses and investments first. Even though it upsets me that Congress would even consider taking my money and giving to a private company like GM, I am at least somewhat relieved that they are reluctant to do so unless it is accompanied with serious overhauls.
But that’s not my main point today.
Today, it’s important to look at the companies that are not being bailed out. It’s a great time to look at investments and ask, “Why is that one not defaulting?” This economic “collapse” (as they like to call it) is separating safe businesses from risky ones, and investors from speculators. It is a necessary cleansing.
And now we all are faced with two options; either we can continue with our old habits that we call investing and blame corporate malfeasance for destroying our nest eggs, or we can become serious, attentive investors who are not pounded by economic declines, but are rejuvenated.
It's a crazy world, but we can still act within it.
-beasley
19:59:49
