Blair

The Bottom's Within Sight - Barron's

The most important point to be made, which may help with what you should do regarding your investments, is the 2 generation change in mindset.

What you are seeing is a reversal of a mindset that started in the 1960s, specifically, with regard to responsibilities. That all of the great things in life are free. Houses, SUVs, great vacations, etc. One will never have to pay for them - housing prices will go up forever and you can always get another equity loan, for example.

From a generational consideration, the baby boomers had children, and these children accepted (why not?) what their parents had told them. So that brings us up to the 1980s. Now those second generation children are having children, who were told that they too could have the great life style. Etc.

So, what is going one is a revision to the real economic world.

To beat the horse real dead, what needs to be cleaned up are two (if not more marginally) generations of a mindset.

I think that this picture now gives an investment forecast. For the indefinite future, the name of the game will be more conservative investments, if for no other reason there isn't any easy money around.

To talk about myself, I am 76 years old, still an active (not trader) investor since 1963. I am down about 10%, but still have some open equity investments since year end.

The market and the economy will do well, but it will be a long haul -- and the tax burdens proposed by the Democrats will make things worse. The best thing long term are the tax proposals put forward by McCain -- not that the economy and market will pop up. All one has to do is to look at the European economies to understand what will happen if the Democrats run our country.

All of the young college people are ignorant of what is going on in Europe, where the unemployment rate for college graduates is on the order of 20%.

While I am ranting, regarding health insurance, etc. Canada, France and Germany are going to a more free market system because they are running out of money. Of course, promoters of the US getting into a government based medical plan have politics in mind, not what would be the best for the American public as a whole.