Would You Trust This Arrogant Nerd's Financial Advice?

Sometimes we Americans can allow our financial better judgment to be suspended by clever marketing, polished wall street analysts, and the seductive power of CNBC, CNNf, etc. It was not enough to endure the dot.com bubble from 1995-2001. Oh no, Americans listened to the same pinheads tell them to stay fully invested for the long term, and to diversify their portfolios over a wide variety of stock classes.

Those who fell for this nonsense are now paying the price for their misplaced trust.

I removed the greater portion of my stock holdings in 2007 in reaction to the felling of market overvalue. My reaction was private as I did not want to subject myself to the jeers of my peers. I have been vindicated, no doubt, by the market drop of 2008-2009.

The myth of "diversifying" over a wide variety of stock classes is not diversification AT ALL. I fell for this scam back in the late 1990's but then noticed that all stocks (even international ones) were highly correlated in trend. No variety of stock classes would have saved anyone in the current downturn!

My point of this piece is to urge you to spread your assets between US dollars in a reputable US credit union (not a bank); a Euro cash account in a country like Switzerland, Germany, or France; the US stock market (10 to 25 percent according to your time horizen); a municipal bond fund; and precious metals like gold and silver (via ETFs like GLD or SLV). This is the diversification.

I do believe we all should be dollar cost averaging into the US stock market at the present time, but we should be doing it moderately and with the intention to continue over the next several years.

US stocks will correct again and again. When the doom and gloom are heavy on CNBC, that is the time to take chunks of your wealth and bottom feed an S&P 500 or Wilshire 4500 fund. This is called contrarian investing and you will reap great rewards if you can purchase cheap shares when the pessimism is high.

Resist the nerds who want to be fully invested at all times so their fees can still be generated from your holdings. They are out for their interests, not yours. You've been warned.

Might The Madoff Swindle Hold A Silver Lining For Jewish People?

Bernard Madoff was recently carted off to jail after pleading guilty. This man has likely breathed his last breath as a free man. It is hard to imagine any positives coming out of this 50 billion dollar scam, but I think there may be one to consider.

The Madoff scheme was a classic, if not gargantuan, affinity fraud scam where the perpetrator seeks out members of his own group to target. Affinity fraudsters bank on the presumption that one would not defraud or cheat his own. I have seen African American churches sponsor "black reparations tax credits," I have seen Christian churches sponsor "gifting pyramid scams," and I could go on and on.

The difference in the Madoff fraud was the scale, duration, and most importantly the sophistication of the victim pool. Madoff did not just target Jewish Americans, he targeted the most affluent, educated, and discriminating ones. Many of these former heirs, tycoons, and moguls have lost everything and they must start anew to build their lives.

"So where's the silver lining," you might be asking. We have all heard the stereotypes of Jews conspirators working toward world domination and Jewish supremacy. Reasonable people reject these notions but often lack the evidence to refute such nonsense, Madoff solves that problem.

Madoff largely victimized many of the most socially prominent and successful Jews. These people were high-achieving, decent people who were intent on no more than securing their futures and providing for their families. They don't have any special means to rescue them. They don't have any collective "Zionist" agenda. They don't have some inborn inclination to subjugate gentiles.

These people are victims in devastating measure and they have my compassion as they try to get on with their lives. I read about a 90 year old man, who now has to bag groceries to eek out a living. There is no Jewish conspiracy coming to his rescue.

So the next time you hear any blather about Jews controlling this or that for the benefit of the Zionist banking conspiracies, let the troglodytes know who the Madoff victims were and how they suffered in the wake of Madoff's discovered mess.

What Your Stocks Have to Return So You Can "Break Even."

Think of the current bear market in these terms. If your stocks go down by the down figure, the up figure is what you need to see in order to "break even." This is scary as we approach the 50% decline.

If you are down by: You need to see a return of the following to break even:

Down 5% Up 5.27%
Down 10% Up 11.1%
Down 20% Up 25%
Down 30% Up 43%
Down 40% Up 67%
Down 50% Up 100%
Down 60% Up 150%
Down 70% Up 233%
Down 80% Up 400%
Down 90% Up 900%
Down 95% Up 2000%

Anything down over 50% could take YEARS to earn back(if ever), so protect your nest eggs!

On the other hand, this is a silver lining for the contrarian investor like myself. Regardless of what people have been saying about dollar cost averaging, it works in protracted bear markets like this one. This is the best opportunity to invest since I have been investing (since 1997). Think like a contrarian; profit like a contrarian!