I am really unsure of my current predicament. There are certain things that tell me that the US economy is going to slow if not go into a recession. It looks like the retail and services sector really did get hit from the subprime debacle as the credit crisis made it difficult for consumers to have enough disposable income to spend while at the same time the problem has reached a point where people are actually defaulting their consumer debt, such as credit cards or car payments as well. It would seem like a great idea to start investing overseas or even on fixed income; then again most of these bad commercial paper created from bundling subprime loans has also contaminated these investments as well.
Investing in foreign currencies is another interesting idea. So far some viable currencies would be the Swiss Franc, known for being historically stable, the Chinese Yuan, and even the Japanese Yen. Unfortunately, it looks like the Euro, Canadian Dollar, and even the Australian Dollar are in the process of appreciating against the American Dollar. Thanks to Paulson and Bernanke’s poor decisions, the U, S of A could also be in a bad position to undergo stagflation, which is a period of economic decline combined with growing inflation. Already we can see petrol prices and grocery prices significantly increasing due to the interest rate cuts, which did little to stem the growing panic over the credit crisis, and it is safe to say this has also taken away from retail sales.
Many people think the third quarter was horrendous for Wall Street, but we have no seen anything yet when we finally get to hear the 4th quarter and annual earnings for these companies. It is safe to say that the results will look like a bloodbath and make the first 3 fiscal quarters look like a slap fight. If America is going down the tubes, just imagine what is going to happen to the rest of the world.
I really don’t sound like a marketing guy anymore. All these transitions and close proximity to the finance department and savvy investors has gradually shifted my interests in the past months. It’s also because I have taken greater control of my personal finances and have access to countless websites and blogs dealing with personal finance in addition to informed colleagues. While it is true that most of the personal finance or investment blogs are full of crap or simply vehicles to promote an average investor’s particular fund or security, a few of them do give useful advice or make posts that summarise major points discussed in common personal finance or investment books.
It’s days like this I wished I had bought shares of Nintendo when it was hovering around $30/share, placed some money in a Vanguard index fund, or put more money into a high-yield online savings account. Then again, I don’t have any credit card debt, I have money in the 401(k), and I am almost maxed out on this year’s Roth IRA; so I am in decent shape compared to others. I do have my own car, I pay for my own mobile plan, and I am not dependent on a financial adviser.
Today is the day I wish I was still lying in the hot springs in Taiwan without a care in the world. Oddly enough I never did find this school while I was around Taipei: