Tuesday, July 23, 2002

Implosion and King Cash

Implosion is the only word I think of when I read the news in the morning. At this point, even trailing earnings are in question due to the bogus numbers. So do we even know what the PE's are? I told my wife this weekend, it's kind of like it used to be in the airport when you arrived early and you sat there and watched all of the "latecomers" running to there flights. My advice is to sit back and watch things unfold. If I had some cash outside of retirement accounts I would be shorting and buying gold (the real stuff). It's amazing to watch all of the witchhunts going on....CEO's, accountants, priests, American Talibans, baseball players on sterioids, and poor Martha Stewart! Is Oprah next!?!?!

My greatest concern is real estate. I think that we bought our house close to the top. I like to think (or hope) that our little town has a good foundation, but the first tremor could be the HP cuts this week. Long term, I really like the oil patch. Supply/demand and the Middle East bode well for this sector. In the short term, OPEC could move into crisis with Venezuela's quoto cheating. Lower oil prices would play into Prechter's deflation argument.

Prechter writes a lot about "change in mood". I'm seeing it on TV at night and in every day conversations. The news about Morocco and Spain fighting over a barren, uninhabited, goat-populated island "took the cake" last week!!

For now, my thoughts are that "cash is king". Our mentality shift now might have to be that 2% is better than -20%.
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