It’s always nice to get a raise. It’s even nicer to get a raise without, you know, actually getting a raise. When my wife began her career as a prosecutor for the state attorney’s office, I immediately got a $300 dollar raise. Now, I’m not a lawyer, nor do I work for the state. So why did I get a raise?
Heath insurance. Hers is free for the family, whereas mine was $300 a month. I am a real fortunate guy. For starters, the $300 a month was lower
than many people I know in the area, so I was already ahead to begin
with. And heck, I actually had a job that offered it, so I was golden. As I said, I’m fortunate.
My friend Kimi isn’t so fortunate.
You can read Part I here and Part II here
Now you’re probably reading this thinking that I want government to come in and save the day. Hardly. Most of the time, government can’t get out of its own way. And the current political landscape is so divided that no one in Washington will risk doing what’s right by sacrificing their political careers, as evidenced by the recent vote in the House on the financial bailout package. (And the pork that was added really upset me, but that’s another issue for another day) But I’m not a conservative who thinks that business will correct itself, either. Complete free markets, when left unchecked, will self destruct. Because all free market theories forget one basic principal: there are people involved. Emotions and greed negate most logical and rational theories. ]]>
Now back to the market itself*. There are many,
many issues at hand, and they’re all inter-related. The ‘biggest single point
drop ever’ that happened on Monday was actually the 17% largest in history. To
match the drop in 1987, it would have to have been 3x larger. And the Dow
itself isn’t the best indicator of the US market. It’s only 30 companies,
and it’s price-weighted, so a dollar gain in a lower priced company (which
would be a larger percentage) would be negated by a dollar drop in a higher
priced company. So while it’s a widely accepted barometer of the US stock
market, it’s not the end-all answer to what’s going on. Look at the S&P
500, or the Wiltshire 5000 to get a better perspective. And while you’re at it,
include the 10 year bond yield, the FTSE (London
exchange) and the MSCI EAFE (a broad European and Asian index) for
good measure. And let’s not forget the CDS (Credit Default Swap) market, which
is a $46 trillion (with a T) dollar unregulated market (in contrast, the NYSE
is $25 trillion). In other words, market analysis is a full time job, not
reading a headline. ]]>
I am a freelance web monkey in Tampa, FL. I am heavily tattoo'd, I sleep too little, I drink too much coffee, smoke entirely too many cigarettes, but otherwise do my thing. My littleman > you.
