Fear.....and Greed

My parents, who have been great mentors in my life, have stressed that the stock market is driven on fear and greed. When I first started actively investing in 2001 I didn't want to believe this ideaology. "The markets are driven on the fundamentals," I said. My strategy worked fairly well for a number of years. Of course, I didn't realize rule #1. It's easy to make money in an upward moving economy. In a down economy things get very difficult.

These bailouts happen. The newscasters try to spin the bailout plans as being horrible, company-saving non-capitalistic measures. So, I thought I'd give my very small viewing audience a little insight as to my thoughts on the bailout plans. Since they seem to be ever-present in our minds....and I even got interviewed on the street regarding this bailout thing. I told the news people that what I'd like to see is:

1. Accountability -hold the people that created this mess accountable. Don't allow them to continue the actions that created this problem. However, this doesn't mean an immediate firing of all the C-level guys. But, it does mean that there needs to be a transfer of power.

2. Tranparency - we, the public and/or the shareholders (truthfully the public has become the shareholders with the bailout) should know where the money is being spent. Simple concept, no elaboration required there. But, the effort to deliver transparency may create some jobs in the IT sector to deliver an information repository....I'm not sure exactly how they'll do it.

But, a lot of people are agreeing with some of the folks out there that say "let the auto companies fail, let the banks fail...don't give them bailout money." To them I say, think about what the money is doing. What happens if these companies fail? If the companies fail and the pensions go away, well, the government foots the bill. Billions of costs are immediately transferred to the government without ANY job creation. Additionally, if the companies fail and the unemployment rate goes up...what happens? Yep, the government foots the bill there too. Benefits, compensation, etc. all gets transitioned to a LIABILITY on the GOVERNMENT's books.

Does spending the money required to help the company crawl it's way out of the hole and fund some R&D to create sustainable growth make better sense? Uh....yea, it does. So, my two cents there.

Oh, and Sarah Palin....seriously....2012....seriously....? Practice your speeches before you deliver them on a national level...because it is ok for me to make a runon sentance in class and feel a little silly. But, when you're not able to talk effectively to the national media what makes you think you can be a presidential candidate. Or, be able to hold a rational debate against one of the most polished and prolific speakers of the modern era in 2012? Perhaps you aren't thinking. Rant complete.