Am I Crazy? Capital Markets and the Federal Governemnt.

Live from Seaside, FL! OK I have been away for a while on purpose. I have been absolutely amazed at what has been happening in the financial markets. Where do I start? Well let's jump on the bandwagon and talk about the Fed's intervention with Bear Sterns. Was the action by the Fed's and the Treasury Dept. legal? Constitutional? I don't think so.

Where was it written that the action of the Fed or Treasury is to bail out one of the top 5 trading firms in the world? It is not written so don't go and try to prove me wrong. What did happen was an unconstitutional action by our government of the USA to bail out a business that made huge bets on the wrong side. Why did the government jump in to save the day? You have heard statements like "we had too", "if we did not the financial market could have collapsed", etc. Well guess what? The purpose of a capitalist market place is for people and institutions to make bets on their own. If the bet pays off, people get rich. If the bet does not pay off, you lose. Since when or who in God's name changed the rules of the capital market? Can you say election year is who changed the rules of the capital market game?

I am truly scared that the actions of the Fed and Treasure has already done so much damage to the reputation of the USA stock markets that and inevitable collapse is the only course of correction. How much longer can we sit still and continue to watch the banks like Wachovia, Bank of America and the brokerage firms like Goldman Sachs and UBS continue to write of "subprime" loans? What about the other secret that the banks are not telling us about? What is that secret? Home Equity loans defaulting. This is the other shoe that is about to drop. Be prepared.

I am so frustrated that our "financial system" has failed us. I feel even worse for the average homeowner who has had to default on their loans and nobody is their to bail them out like our government is doing for the filthy fat and lazy brokerage houses and our USA banks. Worse yet is that we are in an election year and the current administration will continue to hide the massive failures of the banks and the brokerage houses. Just wait, 3 months after the new administration takes over, the "Sh*t" will hit the fan. I predict we will see massive collapse of banks and trading firms in the USA. I continue to believe that we will see the dollar fall to levels so low that the Peso looks attractive and interest rates will have to be cut to a negative number, if that is possible. Folks we can't continue to rob Peter to pay Paul without some fallout. It is coming and it will be a shock to the world.

So what do I suggest you do? Cash is king right now. If you are one of the lucky ones to have no debt then I believe that buying my recommended stocks will pay off huge. I also think that buying property is a nice option now but only if you can by from distressed buyers. Keep an eye on your cash accounts with your bank. Make damn sure they stay registered with the FDIC. I would steer clear from money market accounts over the next 10 months. I truly believe we can see these money market funds start to lose money. Be warned.

So, do I have anything good to say? Well yes. I do believe that the financial markets will work themselves out. But I think it is going to be so painful and we can see another great market crash. History has shown over and over again that our behavior has a reaction for every action. Our banks, government and investment firms have broken my heart with their theft of the solid American market reputation. It will take years to rebuild our credibility with the world. Like I tell all my friends, it is up to you to make the change. I strongly suggest you look at your government representatives and see how much money they made from special interest groups and the financial lobbyist. Vote them out and make a change for the better.