I don’t know about you, but I’m getting REALLY REALLY TIRED of hearing “consumer purchasing down 2.3% in a TOTAL MELTDOWN!  Consumers are under water!  No spending money at all!”

Well,  y’know, if someone has lost their job or their house, they probably are a little restrained in spending their disposable income.  Might actually account for 2.3% decrease.  Ditto the panic over an increase in unemployment and restatement of previous months.  (‘Financial press,’ you WERE paying attention when those businesses crashed?  And now you are “shocked, shocked” that there’s unemployment?  It’s not news.)

Come on, people.  There’s no need to be panic mongers.

The fact is:  the destruction of loans, even odd-ball, ‘financial wizard’ dark pools of liquidity, removes money from the money supply.  It is going to take a while for all of this to wash through the global financial system.  In the meantime, stop, think about your investments; pay off your debt, keep the quality investments, ditch the stocks with no future, and keep the good stuff.  A diverse portfolio of strong stocks with great management teams that can weather troubled times will statistically pay off.  (Yes, some will crash; the great companies (sorry, GM, not talking about you) that can clearly weather the storm will prosper in the long run.

Mind you, I’m talking about in 5 to 10 years.  There’s no easy way to wealth…and there never was.  (Yes, you could have made a fortune in each bubble…and likely would have lost it again, and be taxed for your efforts.)

Good luck.  Don’t panic.  Cover your margins, pay off your credit cards, and rebalance your debt paydown schedule.  You don’t have as much disposable income as you thought you did.

Fond regards,

Dak

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