Financial Market Time Bomb

Latest reports from Hank Paulson over at the U.S. Treasury is that the U.S. Government is going to financially prop up banks but there is a catch. They want stock in return for the favor. I suppose that is better than handing the banks a check and getting a toaster in return for it. Doing the math the deal works out to 15,555,555 toasters at $45 a piece. I don’t think Uncle Sam could ever sell that many toasters on Ebay without greatly affecting the world wide toaster markets so I‘m good with that deal.

For all of you folks following the markets and politics, Rachel Maddow has this interesting video on it…

Video Link



Is it just me or does it not make sense to anyone else for the McCain campaign manager Rick Davis to make a statement like he did in the above video?

“There’s very little a candidate for President, and frankly, after watching today, very little even the President can say about what’s happening in the stock markets other than to hope that they correct themselves.” - Rick Davis

Is it possible that Rich Davis is a “Closet” Obamaican? Then when asked why John McCain or Sarah Palin are not talking about the markets he had this to say in the above referenced video…

“I don’t know if you really want to turn a campaign into a CNBC News show on the stock market. I mean it doesn’t mean that we don’t care and aren’t trying to do something about it. It’s just I’m not exactly sure what you would say everyday.” - Rick Davis

If for no other reason, both candidates need to be talking about this issue every single day for a reason. To instill calm in the markets should either one of them become President. Well it turns out that Obama is talking about it in a logical way that will support new jobs in the small business markets. Just like after 9/11, making credit available to the thousands of small businesses that needed to either rebuild, restructure, or start all over again. It also turns out that John McCain is talking about it but his plan leads to panic in the markets. McCain is proposing, take a deep breath, suspending the “Regulations” (I never saw that one coming…NOT!) to allow people to draw out their 401K and IRA’s without penalties?

One plan builds up small businesses, the other puts a rush by millions all across America to dump their stocks, bonds, and every other investment vehicle for the old Mattress Savings Bank.

Just something to think about over the weekend. John McCain himself has said in the past that he knows nothing about economics and his latest plan would in fact put a full run on banks, company 401K’s, and investments in any form of retirement fund. Common sense dictates what would happen if the penalties for early withdrawal were suspended.

Papamoka

Winter Fears in June

With the price of oil going through the roof and every other utility that people use to heat their homes going up and up people are terrified. People that can not or do not have access to alternative heat sources such as renters and some home owners are literally fearing the coming winter. This is not a joke, just talk to your neighbor if you live in a northern climate state. People are scared to death that they will either eat or heat. What are the elderly folks living alone in their houses going to do on a fixed income when the cost to feed the oil tank is more than the Social Security check they get each month. To put it simply, they will freeze to death in their own home only to be found in the spring.

Americans fought a revolution over tyranny a couple of hundred years ago because their rights to exist were trampled on by a King thousands of miles away. In perspective to that, the King has been replaced by Wall Street’s self proclaimed Lords of the free market. They are not alone in the guilt and blame for this current energy crisis but the prices will never drop to where they were before simply because financial gravity dictates that it can not and will not. In all of this speculation is mutual funds that many of us own and have profited from with the rising price of oil. Retirement funds moved dollars into oil when the dollar fell on the world markets and in doing so reaped enormous profits for the funds.

We have a revolution on our hands in America and the enemy is Us! We can choose to shoot ourselves in our foot with our retirement investments or we can shoot ourselves in the foot with our need for gasoline and home heating oil at a reasonable price? Pick one, then pick a foot to shoot off!

What can you do as your part of the energy revolution? Move your investments out of oil stocks and energy futures. Place the funds into alternative energy research and the double digit growing green energy field. Talk to your investment analyst but make your voice loud and clear. Wall Street and the markets are pricing you out of heat this coming winter and now is the time to speak up with your investment dollars.

We can all bitch and moan about the cost to heat our homes but if you benefit from the gains for the sake of someone freezing to death because a cheaper alternative energy investment did not have the potential gain then the game is the game. When it’s ten degrees out and the thermostat for your grandparents is set at 45 degrees because the oil will run out faster than the pension money does then it is what it is. Investment dollar gains in your IRA or 401K will never equal the amount of sweaters and blankets an elderly person will need to put on to survive this coming winter.

What is truly scary is that this same scenario holds true for many middle class families. People earning decent wages, people with the means to change heating sources now, people working multiple jobs and still in fear of what they will have to do next winter to keep warm. Make no mistake about it, the price of oil is the American peoples enemy and the people controlling that market manipulation in many respects is you and I with our investments for our own retirement. You can look at your statements and shrug your shoulder or move your money out of the people robbing you blind on your oil tank and gas tank. It’s your choice. Money is feeding this frenzy in the price of oil and the gains you get now are not gains when they are taken away ten fold every time you fill your oil tank or gas tank. Investing is a choice and you have the ultimate power to make that choice. It’s your money!

Start knitting your sweaters now for your golden years. If our investments work out as best that we can hope then we just might be able to set the thermostat at sixty degrees. Thus proving that we are far better off than our grandparents. Choose your battle and defend America’s future with your investment dollars wisely.

Papamoka

Over at the Boston Herald they have this great article on the subject...

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