Hey, I'm an American, and I was moved by seeing how important our election was to the rest of the world while spending the election overseas, but Americans have to get real...and fast. I think the Dow breaking below 8,000 was the wakeup call today. Are Obama's grandiose promises just platitudes? Or can he really deliver? I surely hope it's the latter. I'm an optimist, but also a pragmatist. Sometimes, these don't go hand in hand.
While the press generally focuses on the high level topics they think Americans can understand, some recent events are not getting an adequate amount of coverage. Instead of revisiting how GM's been doing post-bailout and what the likelihood is that they'll be back in the spring with their hand out again, we hear the insipid commentary about Michelle Obama's attire for the inagural ball repeated ad nauseum. What the press forgot to cover this week:
- The TARP has already lost 25% (at last check, probably more by now)
- We're about to start nationalizing banks via the UK route
- The auto bailout and subsequent handout in the spring has been totally forgotten now that they got their money
- States are going bankrupt and will need to refund taxes with IOUs
- Pension funds are underfunded big time and this has been further impeded by lousy bets with hedge funds and credit default swaps that they didn't understand
A few people got this right (and note, I didn't for the most part - still long BGZ 3x short ETF but taking it on the chin on my long positions).
- Soros has been saying for some time now that the way the TARP was implemented was inadequate and isn't working.
- The author of The Black Swan (a book that changed my investing outlook forever), Nassim Taleb, provided investors with triple digit returns in 2008 due to his play on the last year's "Black Swan". It's likely that this year will be a nice one as well.
- And get this, I've been checking out these videos by INO TV, especially since much of it's free by just signing up...and they totally called the drop below Dow 8000. I actually had a link to one of the videos advocating the case for a break below 8000 several weeks ago and was chided for such a foolish prediction, but here we are. I recommend checking out some of these videos. This one just came out recently showing the performance of their various commodities plays with their trade triangle system where the portfolio actually showed a gain in virtually every quarter (which admittedly, I'm not using just yet). The videos are free though, what the heck; I've learned a heck of a lot about technical analysis just by watching a few. And the prospect of making money in volatility versus requiring an up market is appealing these days.