Money & Investing - Banks.com

If you want to learn a little bit (and I mean a little bit) about investing, it might not be a bad idea to watch UN-BROKE: What You Need to Know About Money on ABC tonight. It’s a special, airing at 9 pm Eastern. Here is what the description of Un-Broke on ABC says about the special:

Hobson said: “Financial education is critically important, and UN-BROKE proves that it doesn’t have to be boring. The economic crisis was a harsh wake-up call that we can’t keep doing the same thing in the same way. To me, that meant taking a fresh look at my own approach to financial education. This will make people laugh while they learn.”

Celebrities are expected to make appearances so that they can teach us about money basics, from getting a home mortgage, to the basics of the stock market. The E*Trade Babies and The Jonas Brothers are primarily responsible for teaching the basics of stock market. I expect that information on retirement investment accounts will be included. And, hopefully, a little bit of perspective on the currency economic downcycle. But probably not. I have a feeling the main presentation is going to be all about money basics.

And, really, it’s pretty obvious that we do need some exposure to the money basics. The current state of affairs is due, in part, to a gross disregard for the fundamentals of money, investing and how it all works — from the boardroom execs and the Wall Street “experts” to the consumers with lack of financial literacy (or disregard for it).

Overall, I expect this to be a reasonably positive TV special event. And, if enough people watch it, perhaps it can generate more interest in sound money decisions and a future that is built on unsustainable growth and craaaaazy investments.

This really was a rather depressing interview. I mean, it was good. But depressing nonetheless. I really liked Jon Stewart’s point about how what the rest of us are doing basically amounts to capitalizing the “adventure” of these big Wall Street types. And he’s kind of right. We put all this money into rather boring stocks and funds, usually via retirement accounts. Then, the money is used again, but to buy horribly risky, leveraged and opaque investments. Those investments are bought by “experts” who get ridiculously rich. And then remain rich even as the rest of us lose net worth. They get bailouts and golden parachutes, while we get shattered dreams.

Now, honestly, I don’t think it’s quite that bad. I stil think that, overall, as long as you make reasonably good investments and hold on to them, eventually you’ll end up ahead. I think that when this stock market problem is over and things start looking up again, my retirement account will recover. And it will recover nicely. But that doesn’t mean that I’m happy about the way Wall Street has been working — nor am I happy about the way the government and the mainstream media have been complicit. It is rather sickening. Going forward, I hope that we listen to what Alan Greenspan is saying now about sensible and effective government regulation.

Anyway, it’s a great interview. Solid reporting by a “fake news” guy doing what the “real” news people should have been doing.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.

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In the current economy, and with all sorts of worries about the stock market, some people have begun saying that the old rules and the old definitions don’t apply. I say that the age-old rules of solid fundamentals, carefully chosen stocks and regular returns still do apply. Nonetheless, with nothing seeming to work to pull the stock market out of its fund, it is no surprise that there are some definite changes to the way people view the stock market. Here’s my example, using credit derivatives:

Old definition: Surefire way to make insane profits. Don’t ask how, just invest.

New definition: Toxic “assets”. How could all those people have been so stupid?

My Simple Trading System has re-worked some of the common stock investing and market terms we hear to reflect the general cynicism prevailing amongst investors:

CEO –Chief Embezzlement Officer.

CFO– Corporate Fraud Officer.

BULL MARKET — A random market movement causing an investor to mistake himself for a financial genius.

BEAR MARKET — A 6 to 18 month period when the kids get no allowance, the wife gets no jewelry, and the husband gets no sex.

VALUE INVESTING — The art of buying low and selling lower.

P/E RATIO — The percentage of investors wetting their pants as the market keeps crashing.

BROKER — What my broker has made me.

STANDARD & POOR — Your life in a nutshell.

STOCK ANALYST — Idiot who just downgraded your stock.

STOCK SPLIT — When your ex-wife and her lawyer split your assets equally between themselves.

FINANCIAL PLANNER — A guy whose phone has been disconnected.

MARKET CORRECTION — The day after you buy stocks.

CASH FLOW– The movement your money makes as it disappears down the toilet.

YAHOO — What you yell after selling it to some poor sucker for $240 per share.

WINDOWS — What you jump out of when you’re the sucker who bought Yahoo @ $240 per share.

INSTITUTIONAL INVESTOR — Past year investor who’s now locked up in a nuthouse.

PROFIT — An archaic word no longer in use.