All that CRAP you hear are salaried Talking Heads trying to make a living just like you and me. And it is all CRAP.

The market forces we are feeling come from the reality of the health of the economy both in the USA and abroad. Nothing more and nothing less.

IMO .. the market is a mess caused by a direct result in balance of payments in the USA and the National debt. Out of control federal spending on the Iraq war.

There is also a dramatic credit crunch going on and a "shortage of money" to invest. Banks and credit companies are loosing capital or should I cay "hemorrhaging Capital" and sustaining huge losses based on "their own mistakes" and flagrant violation of lending practices with the Housing sector and the recapitalization and subsequent repacking/reselling of collateralized investment packages.

The ballon burst on them and the impact is being felt in the market.

Now then ..that's me being a Talking Head but it is only "Froggy's opinion"..yet I still get paid my dividends every quarter.

IMHO ..times are great for the "smart investor" ..capitalize on depressed values in market/industry sectors that have historically performed well.

In other words ..new money invested buys more units of value at a lessor cost. Thus, when robust growth returns, the profit per unit of value will be greater.

That kind of thinking allows a person like me to retire 10 years early and live on "other peoples money"..!

It's all in the math ...and my daily reading of the Wall Street Journal.

BadFrog

I see every day, people who have to live on 10K/year or less. Some of these people have children living at home. Most of them work (some 2 or more jobs). I find the "stock market" news to be a nice "smoke screen" for the reality of more and more "working poor" and a definite GROWING separation of the "haves" and "have nots"

The combination of instant information and day trading (better name would be milli-second support) provide a very dangerous dynamic.

The stock market was created to provide investment for companies and to reward those who invested in the growth of said company. When goals shift to making money on a minute by minute basis, the logcial consequence is for companies to succumb to short-term thinking.

If the "investment" into an enterprise is won or lost in the blink of a silicone chip, we build our economic stability on shifting and fickle silicone sand. Or a better metaphor might be a horny misquito mating with as many bugs as possible, but hey no commitment man...I'm off to get my next 4 second lay.

A rebuild of the system that mitigates fickleness to at least a quarterly basis or some other mechanism would seem prudent.

I can dream...can't I?

WM

IMHO i think your well intended opinion of "have and have nots", is misplaced with the smoke skreen comment.

There are huge numbers (millions) of folks in 401k's, self directed IRA's and independent investors making $Billions of dollars savings/investments. Typical middleclass working folks as well as the affluent.

The growing separation engulfs vast numbers of low/middle/lower upper "have nots" vs. a very small number of "rich haves".

The smoke screen you refer to is what I call the CRAP Information. It is pure bullshit for the vast majority of people saving and small investors. It;s aimed at the very-very small select few of affluent investors making daily trades and high churn rates.

I self manage 7 stock portfolios founded in various industry sectors. I have dumped one and combined it into three others. The reason .. a negative earned income for 2007. All the others returned positive earned income..thats how I eat ! The dividends pay my grocery bill and the rent (so to speak).

One the up and up ..2007 was a very positive year for earned income and a lousy year for "total portfolio value". But that does not count. I don;t plan to sell. Therefore the total value is "just a number on paper". What is important is the number of units of stock x the dividend payout. That "is other peoples money that I live on".

With depressed market values and a good selection of historically well performing stocks and mutual funds, it is a "silver lining for investors"..by low ..sell high, later on ..or in my case, by low..watch dividend growth and eat better as the dividend goes up !

Froggy.

capivi

imo ..your comment is not from a well informed understanding of raising capital, corporate performance and overall financial investing/savings.

The market system works extremely well. The talking heads must make a very "blah subject" interesting, or else they wont sell head lines.

IMO only three things mattered in 2007 that were worth reporting on

- The housing sector fiasco and the criminal activity that took place in mortgages.

- The blatant ignorance of huge banks, finance company's and wall street brokers, that took extremely poor colateralized investment packages from the mortgage industry and caused a credit meltdown, lack of new investment capital, a down turn in already overly inflated home prices etc.

-The continued runaway goverment spending that has made the USA balance of payments the "whore of the financial world" and or uncontrollable national debt.

Before the market bubble burst ..it hit an all time histroical high of over 14,000.

The system works .. the people who "work the system" need a wake up call !

What is happening now is just another Enron .. but instead of reporting a flagrant fraud on a single company, it is a flagrant fraud on the entire USA economy !!

Froggy

Froggy,

I really wish you could see what I see. I am usually "insulated" too. But, when I see the substandard wages and working conditions I see, along with the "scrambling" for EIC to survive, it makes me want to "bitchslap" our politicians and corporate leaders. It's fine to talk about "indicators" of the economy such as "The Stock Market". But, it is only numbers and does not address the reality of what is happening to the US at this time. There are times I alternate between extreme anger at the politicians and wanting to cry for these people I see every day struggling to survive.

Froggy, my uninformed opinion aside...we both land at the same place.

Short term thinking trump prudence and the "system" is in bear mode if not free fall. Your argument that it is due to predictable consequences of inane behavior has to cede to my point that short terms rewards have a cascading effect on decision makers.