It is doubtful its going to take 5 let alone 10 years to recover. Lainey you have plenty of time and look at the bright side the shares your future investment are buying will be lower so you will have more shares when the prices rebound.

 

I don't know about that, Dave. The slump has taken all we had made and more since the last slump in 2001, not to mention what we have deposited in the last little while has vanished too.

My investments from here on out will be extremely conservative and switching the balance to more fixed investments.

I leave the playing in the stock market to those with cast iron stomachs.

 

I just sent over a bunch more money into my trading account. I mean, who wants to buy car parts in the fall anyway

I could buy Rotas today or a nice set of Volks in a year. If you see me rolling on stock wheels next fall you know I lost it all

 

I feel like taking a walk on the Tobin Bridge. Anyone want to join me?

 

Watch the market around 3:00 today.
I suspect that is when it will step off the cliff.
nasty open Monday.
Tuesday is when to get back in.

 

That's because I haven't explained it to you yet.

GM needs money, so they issue bonds to raise cash. Jerry says "hey, that rate of return on GM bonds looks awesome, I think I'll buy me some."

But then he gets to thinking "you know, GM cars are pretty stinky and all the guys on the S2Ki forum make fun of them except Erick and he isn't going to buy one cause he can't even afford a refrigerator. I'm not sure GM can pay this bond."

So Jerry calls the richest person he knows, Lainey, and says "hey Lainey, will you gaurantee these GM bonds?"

Lainey takes a look and says "sure Jerry. If GM doesn't pay those bonds, I'll pay you, BUT, it's going to cost you for the gaurantee."

So Jerry says "gee, how much... like 100 cookies or something?"

And Lainey says, "no, it's going to cost you a percentage of the return on the bonds and you have to pay it up front."

So Jerry says to himself, well, I guess I really want that gaurantee, but how do I know Lainey won't just blow all her money on cookies and not have any to pay me if the bonds default? So Jerry says, "well, ok Lainey, I'll give you $ for the gaurantee, but I want you to put up some collateral in case the bonds actually fail. Money that I know is available all the time."

And Lainey says, "fine, heres a box of money I kept under the bed. It isn;t the full value of the bonds, but a percentage that should cover a worst case shortfall. We'll keep it over at Bill's house for safe keeping cause he never spends anything on anything.

So now Jerry can rest assured that if GM bonds fail, he's got Lainey money to back it up. And that's the value of a credit default swap.

 

It always falls at 3:00. That is when the fund managers have to sell holdings to cover sell orders from 401k people who are running for the exits.

 

If I'm the richest person Jerry knows, Jerry needs to get out more.

 

I you need a bail out.....I'll buy your Boxster for pennies on the dollar!

 

Bill for financial advisor