Financial Advice

During the past few weeks of economic confusion, we have received two letters from our financial advisor. Yesterday evening, he called. Now, keep in mind, we are no top dollar clients, just a single income family with a rolled over IRA. Not only is it very gratifying to receive this level of attention, but the advice we've been getting has been very helpful and reassuring. I asked him if it would be alright if I shared part of his latest letter here and he said that would be fine. This was written Thursday evening just after the big drop in the stock market.

"Here is what I would expect over the coming days. The all out panic hits the market and, if today was not the bottom, expect havoc on Friday and/or Monday. I think once that happens and the system has cleansed itself of the panic, the market will rebound strongly. Unfortunately, it will not necessarily be over yet. The market has a tendency to test its bottoms. It did so in 2002, the DOW dipping into the 7,000s in July, rebounding strongly and retesting by dipping into the 7,000s once again in October 2002 which happened to be the bottom.

"The panic is here and the market should bottom very soon. Expect it to rebound quickly and decisively, but don't get too comfortable. Within a few weeks or months, it could very likely retest its lows and then we should see a sustainable rebound going forward.

"The economic news will get much worse. The market is pricing in the depth of the recession that "experts" are finally waking up to. The market will be on its way up long before the economy turns around. So don't worry too much about the economic news, the market is already ahead of your worries.

"On a side note, you may want to call your politicians and tell them to leave well enough alone. I don't see where their actions or their words are doing ANYTHING to help the situation. That being said, the market appears to now be ignoring the government and making its own adjustments. This is a VERY positive sign and it's the first time in a year that I feel I'm getting a good read on what the market is doing and I think it's trying hard to bottom out."

--David F. Boothe, President
BIG Investment Services

He also told us not to watch Glenn Beck, which made me wonder if he might know us a little too well. On a serious note, he predicts the world economy only has about another 30 good years before a major global collapse. This should give me more than enough time to build my concrete bunker and barricade myself inside it.