We will all remember today as the beginning of the new market. Congress has apparently come to terms on a bailout plan and, barring any last minute shenanigans in the House or Senate, it will be voted on and passed this week. We all have a new managing partner in D.C., whether we like it or not.
It is times like these that require perspective, and I assure you that the cooler heads will not only prevail, they will profit. I've been around awhile, and I managed to make enough money during the last major crisis to step back and casually observe the current mayhem. The lesson I took away from the Long Term Capital Management debacle and the Asian Flu (and, for that matter, the bear market following Black Monday ten years before that) is that the market is the market, and always will be.
The market is in a constant state of flux. Our markets are even more so from time to time due to varying levels of government intervention. In the 80's there were junk bonds and insider trading. Lots of people got rich and a few went to jail. In the 90's it was Internet IPO's and hedge funds, along with the beginning of the current crisis in derivatives. Lots of people got rich and a few went to jail. Now, we have this mess. It is truly unprecedented in scope and scale, and should give everyone pause, but in the end lots of people will get rich and a few will go to jail. Do you see a pattern here?
The market may be the most perfect thing in your life. It will absorb this hit and reinvent itself like it has time and time again. Make no mistake, this is not the end of our troubles. Even larger crises loom in the next ten years, and they will probably make $700 billion look like a drop in the bucket. But the market will survive those crises too, in one form or another. And yes, lots of people will get rich and a few will go to jail.
So, how do you profit from the current disaster? I know you have short attention spans and I'm already losing a few of you, so I'll tell you tomorrow...
Bravo, looking forward to the nextpost
a bit premature. i wonder whats next. they might as well suspend trading for the next two weeks while they sort this whole mess out.
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