Back in November 2009, the world stock markets were crashing. I wrote this post back then because I kept coming across people who were not clued into what was happening in the global economies. They were busy going shopping for unnecessary things instead.
Who would have thought that one of the most glitzy countries in the world would have trouble paying their own debt on time? The fear of systemic contagion is real as investors sell first, and ask questions later.
If Dubai can’t pay their debts, who else can’t? The US of course, but that’s OK! Everybody will fund our debt as you observe the US dollar and US treasuries strengthen. Don’t believe me? The 10-yr US treasury yield has dipped below 3.25% again. What inflation? Cheap money forever!
Investors around the world can mock us, and debase our weak currency all they want! You shouldn’t care, because all you have to do is watch what investors DO and not what they say. Investors are rushing in to our arms today crying “We love you America! Give us shelter!”
Instead Of Going Shopping, Invest For Your Future Instead
So many have disagreed with our “A Weak Dollar Doesn’t Matter Folks!” thesis. Yet so many are going to shop till they drop for pieces of junk they shouldn’t be buying in the first place! It’s Black Friday every day at Ross, TJ Max, and Craigslist, so save your stress and relax!
If you’re going shopping today, check your 401k and stock accounts when you return. You might just have to go back on Monday and return everything!
* CONTEST * Predict where the Dow Jones closes today (11/27/2009) and win a free pat on the back! I predict 10,288. I’ll also highlight the winner in my weekly Katana wrap.
Readers, are there any out there who are relaxing at home in their pajamas being entertained by the media coverage of shopping frenzy? Why don’t people just shop on-line instead, given similar deals? If you make $20/hr from work, but stand in line for 5 hours to save $100 on a laptop, doesn’t the bring you back to even?
- How To Maximize An Umbrella Policy Like A Champ
- Who Is The Middle Class? We Are All Middle Class Citizens!
- You Can Count On Social Security Benefits In Retirement
- Take Advantage Of Unemployment Benefits And Milk ‘Em Dry
- How To Make $50,000 A Year For Free From The Government
Recommendation To Build Wealth
Manage Your Money In One Place: Sign up for Personal Capital, the web’s #1 free wealth management tool to get a better handle on your finances. You can use Personal Capital to help monitor illegal use of your credit cards and other accounts with their tracking software. In addition to better money oversight, run your investments through their award-winning Investment Checkup tool to see exactly how much you are paying in fees. I was paying $1,700 a year in fees I had no idea I was paying.
After you link all your accounts, use their Retirement Planning calculator that pulls your real data to give you as pure an estimation of your financial future as possible using Monte Carlo simulation algorithms. Definitely run your numbers to see how you’re doing. I’ve been using Personal Capital since 2012 and have seen my net worth skyrocket during this time thanks to better money management.
Updated for 2021. Let the bull market continue with stocks at all-time highs!
Nina Roberts says
Nice article…!!!I do agree with you that the stock market crash which destroyed the economy like anything have not yet provoked the shopping freaks to put a stop to their craziness.Even if they really don’t need a thing,they will not step back when it comes to buying it just for the sake of it.Your article is thought provoking but black Friday can be hardly expected to turn white the way it’s going.We can try our best though to make amend and disseminate information so that some people at least stop to think and act !!!
Good to hear you visiting from China. You should the younger generation doesn’t shop that much? I was speaking to the management of a major luxury department store chain and he says the Chinese are VERY brand focused.
The Scitech mall in Beijing, for example, sold 70 Bentley’s this year!
.-= admin´s last blog ..Tuition Hike For The Poor Is Like A Tax Hike For The Rich =-.
The situation is quite different here in China,people do not shop that much.So,there is no black Friday market at all.
.-= Avery´s last blog ..Nokia to Reduce its Smartphones number =-.
shopping is good for the economy, more shoppers=more money for business which equals more jobs and more money to be spent!
@admin I switched off the captcha code last night and installed IntenseDebate so it should be working now. I can’t get CommentLuv to cooperate with my theme and any other plugins.
You’re right, I wasn’t thinking about Asia, and Canada never crossed my mind. Speaking of Canada, I just learned Canada was a constitutional monarchy and Queen Elizabeth the Head of State. What’s the point of that? I think the era of monarchies is way over.
.-= David´s last blog ..More small business shoestring marketing tips =-.
Matt S. says
It makes total sense to me. A nation that spends its way out of a deficit should surely be able to shop its way out of a recession!
Gotcha. A very best to you in your day trading activities. I’ve tried day trading many MANY times before, and 8 out of 10 times, I would give it all up in some stupid trade that just crushes my profits.
The problem with me is that I don’t quit while I’m ahead. I also love going 3:1 leveraged when buying things. Eventually, things go wrong, and I blow myself up. Then, I start cursing the stupidity of the world, but really, it’s just me that’s stupid! :)
Here’s hoping for a rebound this week, like Europe did on Friday!
I’m a day trader for a brokerage firm here in the Philippines. I actually just started out early this year, and I have to admit, short-term trading has been really tough since I have to deal with the daily market noise. I make more money trading by myself. Haha. But it’s my passion, and it’s a great opportunity for me to learn trading the right way.
I agree with you. The massive rallies we shouldn’t have had in Sept. and Oct. may kill the Santa Claus rally (profit-taking for the holidays). However, I do believe that if companies beat revenue growth expectations in the coming earnings season, we’ll continue to climb a bit higher. *crosses fingers*
.-= trader´s last blog ..Blood in the Street =-.
Keigu–What you’ve written is brilliantly absurd! The sharks are circling the boat, but the passengers are still partying.
This will sound like semantics, but as true as what you’ve written may be, none of it will matter until it matters, and by then–it’ll be too late.
In the meantime, we shouldn’t be surprised if the stock market continues rallying despite the Dubai debacle. Momentum seems to trump reality in rallies, and this market is clearly in a rally phase.
.-= Kevin@OutOfYourRut´s last blog ..What Career Will You Have in “Retirement”? =-.
It’s actually a real estate MELT UP again all throughout Asia, and our Canadian neighbors up north!
Nice job using the comment luv thing. I love that plug in. I don’t know how to keep it permanently clicked though.
BTW, just tried commenting but it said “CAPTCHA code not working” or something, but I don’t see a code to input in the first place.
I’ve been hearing about these extravagant Dubai real estate projects for years now and I would be laughing at them if oil hadn’t taken such a big hit from the Dubai World news. Refiners haven’t been making money for a while and this certainly isn’t going to help. Seven star hotels (seriously), indoor skiing (yes, skiing), and millions of tons of dirt and rock pushed into the ocean to build islands for the ultra rich. I don’t know why this came as such a surprise to the markets, everyone else in the world had their real estate meltdown a couple years ago.
.-= David´s last blog ..More small business shoestring marketing tips =-.
Everyone always discuss the dollar trade off ($20/hour to save $100) – but doesn’t that assume that the person (1) has an hourly job and (2) is allowed to work more hours at that hourly job.
Ignoring those 2 issues – you’d probably have to work 6 or 6.5 hours thanks to taxes! It may be worth it just to be MISERABLE for an hour or two to save the hundred?
I honestly don’t think we’ll ever learn, which frankly is fine by me! How boring it would be if we never had cycles. Cycles are what makes things exciting and nerve racking at the same time!
.-= admin´s last blog ..The World Stock Markets Are Crashing & You’re Going Shopping?! =-.
I’m pretty impressed the US only went down 1.5% as well considering Asia and Europe went down 3%++. Guess we’re the safe haven, low beta market!
We’re going to have low interest rates for a very loooong time.
Hey there! Good to hear from you HK equities trader! Are you an individual trader, or trader for a big bank?
Everything I’ve read seems to be that this incident is no big deal and won’t be systemic. All the creditors have to do is work out and arrangement, so Dubai World doesn’t go under, otherwise everybody loses.
I wonder about the Santa Claus rally too. We didn’t have the usual Sept and Oct correction, so I would think any Santa Claus rally we have will be quite muted. However, it’s important the markets don’t crater into bonus decision time, otherwise that would suck!
I was really looking for more of a shakeup from this Debai deal. This isn’t just another bank going into bankruptcy protection. I suppose we have to wait for another catalyst to remove the bubbly atmosphere that the market seems to have these days. Interest rates are too low and it is leading to major speculation. Look out Asia.