Monday, March 02, 2009


No running over the weekend (big shock, eh?).

I DID get my tomatoes in the ground, but I think it may have been 1 or 2 weeks too soon.  The problem is that I’m going out of town in 2 weeks and had to get those puppies in the ground, and I figured sooner was better than later.  The bigger problem is that a couple of them were still pretty immature and may not make the transition to the outdoors.  Out of 16 plants, it looks like I may still have 12, possibly 14.  I’m be STUNNED if I get all 16 to survive.

Cest la vie.


Meanwhile, the market continues to plunge.  I’m a little surprised the bloodletting has continued this long, but what you gonna do?  So, I think this officially passed the “bad” mark when the 7,000 threshold was crossed.  12 year lows are unprecedented.  That still doesn’t mean it’s a terrible thing.  A fundamental restructuring of the way we buy and sell things may be happening, which is a good thing.  You simply can’t continue to grow an economy on credit alone.  That’s one of those fundamental structures of the economy that is showing itself to still be intact.  You eventually need to pay the bills.  HEAR THAT CONGRESS?!?


The silver lining, though, could be this:  yes, that $1 you put into your index fund is now worth $0.50 (or less), but that $0.50, coupled with today’s $1.00, will be worth $3.00 when the market recovers back to the point it fell from.  When will that recovery happen?  I THOUGHT it might be next summer, but I’m not so sure it will be that soon anymore.  Almost certainly it’ll be within 10 years, which would represent a 10% year on year return (10% per year for 10 years is 100%), which is pretty damn good under any circumstances.  And since these things rarely go in a smooth line, it’s probably best to be prepared when things are cheap.


Then again, if you’re retiring soon and your portfolio wasn’t properly diversified into income generating funds life will really, really suck for the next several years (might even suck if you were properly diversified).  Too bad social security wasn’t properly reformed to ensure those who need it will be able to get it far, far into the future.  Herein we see an excellent argument in favor of social security reform coupled with extreme caution in the march toward total privatization of those funds.


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