Saturday, October 11, 2008

More on economy coming

Sorry it's been over a week since I've posted -- the financial crisis has kept me plenty busy. I've been spending a lot of time over the past 10 days reading and researching more about what we're facing, both in terms of what has caused it and what kinds of things we can do about it now.

Almost nothing has changed from what I wrote here 10 days ago. It's one of those times when I hate being right.

When I haven't been reading/researching, I've been talking to banking executives (it's my job -- I'm a consultant/sales manager to bankers). In particular I've had a couple of very good, deep conversations with bank CEOs about how the next six to twelve months are looking for them. It ain't pretty and there's no quick/fast road back, no matter what our current President says. Rule of the harvest, remember?

My buddy James has implored me to write more about the economy, so that's exactly what I'll do. Over the next three days, I'll write on these three topics:

1) The real root of the problem (and the solution) that nobody is talking about
2) Tracing the life of a mortgage, in layman's terms
3) Who's to blame (everybody) and who in Washington has the fix (nobody)

Sounds cheery, huh? Don't worry, I'm not a fearmonger. I just try to be a realist.

Example: In this weeks' presidential debate, Tom Brokaw asked the candidates, "Is it going to get worse before it gets better??"

Obama and McCain both chickened out and gave long answers that meant nothing.

My answer would be "Yes. But it will get better."


Steve H. said...

Just read your previous post on the economy and look forward to what you go into this week...

t.k.foster said...

I don't think it would be wise to invest in financial stocks. On the other hand, there are really good deals in the market right now and I think with it getting just a bit lower, it might be time to buy for long-term and wait for three years or so before those investments start producing major dividends for those that sold earlier this year and waited to buy at the right time.

Debby said...

Tim's 401k lost an astonishing 60%.It is time to hold on tight and ride it out. We just hope he doesn't lose his job. Not because we rely so heavily on the paycheck but because we are sunk without the insurance.

Redlefty said...

Thanks, Steve!

t.k., I agree, and not just this time, but as a general principle. Whatever money people need access to in 2 or 3 years shouldn't be in the stock market.

debby, 60%? Yikes. I'm sorry -- I know that must hurt.

Debby said...

No worries. To us, it is just numbers on paper. I've always felt that he invests too riskily, and so I invest mine too cautiously. I am sure that the stock market will correct down the road and all will be well again. It may take a couple years.

However, I do feel mighty bad for the elderly who are trying to live off those 401Ks now.