[Vision2020] And the Saga Continues . . . (unfortunately)

Mon Aug 8 16:11:51 PDT 2011

Well, the first item isn't so much 'tweaking' the programs to allow such securities to exist in your portfolio, insomuch as reinvesting in a DIFFERENT fund that would allow such items.  (You can find as many different mutual funds as there are grains of sand on the beach.... ones that only invest in energy, ones that only deal with small cap/large cap, ones that only deal with business/debt restructuring, or ones that refuse to invest in any organization that begins with the letter 'r'.  Basically, when US was downgraded, a rule/threshold was crossed, and some percentage of the sell off was due to fund managers having to obey the conditions set forth by the initial investment criteria.

As far as the second item?  (What's the alternative?).  That's the 64,000 question..... from current market conditions it looks like many people feel safer with their money in CASH rather than putting into investments... when tbills got hit with the downgrade, suddenly the universe's safest investment felt a little less safe.

Many seem to be turning to gold as an investment (which is really just a hedge)... but no one knows right now where to go.  They just know where they don't want to be.

Jay

Sent via DROID... so ignore the typpos

-----Original message-----
From: Paul Rumelhart <godshatter at yahoo.com>
To: Jay Borden <jborden at datawedge.com>, Tom Hansen <thansen at moscow.com>
Cc: Moscow Vision 2020 <vision2020 at moscow.com>
Sent: Mon, Aug 8, 2011 22:51:39 GMT+00:00
Subject: Re: [Vision2020] And the Saga Continues . . . (unfortunately)

I hadn't thought about the first point.  That's a problem insomuch as no one tweaks those programs to allow AA+ TBill ratings for the short term.  Not that I think that will happen, but it seems an easy solution to what is really a political problem, as opposed to a purely financial one.

As for the second factor, what's the alternative?  Unless you are right on the brink of retirement, like in the next month or two, then I still think it's a bad move to sell now.  If you sell now and buy something that hasn't been hit as bad, then you are basically stepping into that new stock in order to get on it's normal growth curve.  The old stock, which used to be valued higher, should spring back to near it's original value if it wasn't already overvalued to begin with.  

I feel really bad for the people who are in that group that were planning on cashing out soon, but I don't know what can be done about it.

Paul

________________________________
From: Jay Borden <jborden at datawedge.com>
To: Paul Rumelhart <godshatter at yahoo.com>; Tom Hansen <thansen at moscow.com>
Cc: Moscow Vision 2020 <vision2020 at moscow.com>
Sent: Monday, August 8, 2011 12:32 PM
Subject: Re: [Vision2020] And the Saga Continues . . . (unfortunately)

Paul:

There are two large factors...

1)  auto selling of securities holdings that specify the portfolio must have a % of investments carrying a AAA rating (like tbills)

2)  investment horizon.  You and I have the luxury of time.  We can let our money sit.  Others on the fringe of retirement are seeing their nest eggs lie in ruins and are pulling out for salvage.... fearing the market wont recover again on their windows of time.

Jay

Sent via DROID... so ignore the typpos

-----Original message-----

From: Paul Rumelhart <godshatter at yahoo.com>
>To: Tom Hansen <thansen at moscow.com>
>Cc: Moscow Vision 2020 <vision2020 at moscow.com>
>Sent: Mon, Aug 8, 2011 19:17:14 GMT+00:00
>Subject: Re: [Vision2020] And the Saga Continues . . . (unfortunately)
>
>
>
>I don't understand this.  Really, what's changed that affects any
    given stocks fundamentals?  If I own a stock I bought prior to last
    week, what has fundamentally changed about that stock that I should
    start assuming it's not just going to climb it's way back up to
    where it was as soon as the panicked sheep have stopped slashing
    their own throats?  Unless I have reason to believe that my stock
    will plummet to zero, I would think that the last thing I should do
    now would be to sell.  On the other hand, if I had the money I'd buy
    lots of good, sound stocks that have fallen in value that someone
    else has sold out of some hazy "fear of the financial situation" and
    ride them  back up to where they were in a few weeks time when this
    whole stock market hysteria blows over.
>
>Paul
>
>On 08/08/2011 07:58 AM, Tom Hansen wrote: 
> 
>>The market as of 10:50 AM (New York Stock Exchange Time), today.
>> 
>>Thank you, Tea Party!
>> 
>>The DOW is down almost 1,200 points . . . SINCE TUESDAY!!!!!!!!!!!!!!
>> 
>>One can hardly imagine what to expect from the 12-member super congress panel in November . . .
>> 
>>Second verse same as the first, a little bit louder, a little bit worse.
>> 
>>Seeya round town, Moscow.
>> 
>>Tom Hansen
>>Moscow, Idaho
>> 
>> 
>> 
>>
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