JayPee Morgan

Maybe it’s time we talked about used cars.

We think with the economy in a shambles and getting worse, maybe it’s time to start working on the car yourself and buy some used ford cars instead of a now defunct hummer.

And don’t forget used volkswagen cars. Of course, we like the farfeignuggen that goes along with so we recommend that instead of buying something else, you get one of them.

Used cars make sense in this economy, that’s why we’re all buying used Bentleys and Rols Royces.

Despite banks in the United States making record profits, the world’s economy is still in dire straits. We recommend that you pull all your money out and convert it to Chinese RMB and then stuff it in your mattress today.

Shares in Societe Generale sank as much as 6% Wednesday after the French bank warned that it would take another 1.4 billion euros ($2.02 billion) of charges on risky mortgage assets, virtually wiping out its profit for the fourth quarter.

In a brief trading update, the bank said it had again marked down the value of its mortgage holdings to reflect rising loss rates on both prime and subprime loans.
The latest charge offset a solid performance in retail and private banking as well as a capital gain of around 600 million euros following the merger of the bank’s asset management arm with that of Credit Agricole (PARIS:FR:ACA) .

SocGen (PARIS:FR:GLE) said it now expects to generate just a “slight profit” in the quarter. Analysts polled by Bloomberg had been expecting the bank to report net income of 850 million euros.

Shares in SocGen, which is the first major European bank to provide a fourth-quarter trading update, fell 3.8% on Euronext’s Paris market, having dropped as much as 5.9% in early trading. The stock is up around 44% from a year ago, but is still down around 65% from its peak in early 2007.

Other European banks also declined Wednesday, with BNP Paribas (PARIS:FR:BNP) dropping 1.9% and UBS (SIX:CH:UBSN) (NYSE:UBS) losing 1.4%.
Fixed income slows

On top of the latest mortgage charges, SocGen said it will take a 100 million euro hit from the changing valuation of credit defaults swaps. In addition, it expects to report a slowdown in earnings from corporate and investment banking, especially in the fixed-income side of the business.

The weaker result reflects both lower investor activity since November and less favorable market conditions, the bank said. However the unit has made a more encouraging start to 2010, it added.

WASHINGTON – The economy is rebounding from its deepest slump since the 1930s, but it probably won’t seem that way when the government releases its monthly employment report on Friday.

Employers aren’t expected to start adding jobs for several more months. Many are skeptical about the strength and sustainability of the recovery,

The nation’s economy probably lost a net total of 175,000 jobs in October, pushing the unemployment rate to 9.9 percent, according to a survey of Wall Street economists by Thomson Reuters. The Labor Department report is scheduled for release at 8:30 a.m. EST.

Most economists think the rate will eventually surpass 10 percent, a level last seen in June 1983.

The economy grew at a 3.5 percent annual rate in the July-September quarter, the government said last week, the strongest signal yet that the recession has ended. But that alone won’t spur rapid hiring, raising the likelihood of a “jobless recovery.”

“You need explosive growth to take the unemployment rate down,” said Dan Greenhaus, chief economic strategist for New York-based investment firm Miller Tabak & Co.

Greenhaus said the economy soared by nearly 8 percent in 1983 after a steep recession, lowering the jobless rate by 2.5 percentage points that year. But the economy is unlikely to improve that fast this time, as consumers remain cautious and tight credit hinders businesses. In fact, many analysts expect economic growth to moderate early next year, as the impact of various government stimulus programs fades.

On Capitol Hill, the House on Thursday sought to bolster the economy by approving a $24 billion measure that expands a popular homebuyers’ tax credit and extends unemployment insurance for 14 to 20 weeks. The additional jobless benefits are intended to prevent almost 2 million recipients from running out of aid during the upcoming holiday season. It is the fourth extension of benefits during the recession and means that unemployed workers in some states can claim up to 99 weeks of support, a record.

The Senate approved the bill Wednesday and President Barack Obama is expected to sign it.

On Wall Street, a better-than-expected jobless claims report and an upbeat forecast from Cisco Systems Inc. buoyed investors Thursday. The Dow Jones industrial average added nearly 204 points to 10,005.96, and broader indexes also gained.

Still, jobs likely will remain scarce even as the economy improves. The uncertainty surrounding the pace of the recovery has made many employers reluctant to hire, economists said. And many companies have cut hours for workers still on their payrolls, which means they can add those hours back before hiring new people.

Diane Swonk, chief economist at Mesirow Financial, said that small businesses, a primary engine of job creation, still face tight credit and don’t have the cash reserves to support extra workers.

Fein Tool North America, a Cincinnati company that supplies auto parts manufacturers, has cut about 100 workers, or 33 percent of its staff. But Fein President Ralph Hardt said the company can still fill its orders by using more overtime shifts and temporary workers.

Hardt said he plans to slowly rehire once the economy picks up again. “If I see signs of recovery, I am going to hire back, but I am going to be very prudent,” he said.

The recoveries following the last two recessions in 1991 and 2001 also were considered “jobless” as the unemployment rate didn’t peak until 15 months and 19 months, respectively, after they ended.

Economists cite several reasons why job growth is increasingly lagging recoveries. To begin with, layoffs are more likely to be permanent, compared with temporary furloughs by manufacturers in earlier downturns. And globalization has made it easier for companies to hire overseas when rebounds begin.

Many companies also are squeezing more production from their existing work forces. Productivity, the amount of output per hour worked, jumped 9.5 percent in the third quarter, the Labor Department said Thursday.

That’s the sharpest increase in six years and followed a 6.6 percent rise in the second quarter. The increases enable companies to produce more without hiring extra workers.

Still, many economists saw a bright side: companies can only drive their existing workers so far. Eventually, they will have to hire more people as the economy improves.

“You just can’t get blood from a turnip,” Swonk said.

The Labor Department said Thursday that new jobless claims fell to 512,000 last week, the lowest level in 10 months.

Economists closely watch initial claims, which are considered a gauge of the pace of layoffs and an indication of employers’ willingness to hire new workers. Claims remain well above the roughly 400,000 that economists say will signal job creation.

The Federal Reserve, meanwhile, said Wednesday that it will keep a key interest rate at a record low level of nearly zero for an “extended period” in order to support the economy.

The central bank said economic activity has “continued to pick up,” but Fed Chairman Ben Bernanke and his colleagues warned that rising joblessness and tight credit could restrain the rebound in the months ahead.

November will be a month of pure hell and torment for most people with swine flu, ‘unexpected’ company and bank failures (hello citigroup) and no shortage of other ’surprises’. I’ll be in the Bahamas.

-Jaypee

The biggest decision of the economic recovery will be made in the next six months, and Barack Obama will have almost nothing to do with it.

Forget the debate over TARP, and never mind the questions about a second stimulus. This decision is about when to pull out $1 trillion that’s propping up the U.S. banking system. And it will be Federal Reserve Chairman Ben Bernanke and his Fed colleagues who make the call.

That’s hard enough for a White House that knows its political fortunes rise and fall with the economy.

What’s worse is that Bernanke and Obama – like many presidents and Fed chairmen past – won’t necessarily have the same goals for this trillion-dollar decision.

Fed chiefs worry about inflation. Bernanke wants to take the money out quickly enough to prevent the economy from overheating and causing a jump in prices that strangles growth. But move too fast, and the economic recovery runs out of fuel.

Presidents worry about jobs. Obama probably wouldn’t mind a little overheating, say, next summer – when voters are starting to make up their minds about the 2010 congressional elections, and he hopes the economy can shake the 10-percent unemployment rate doldrums.

“Any chairman of the Fed will do what’s right for the country, not what’s right for the administration,” said Ernest Patrikis, a partner at the law firm White & Case who spent 30 years at the New York Fed. “That’s his job – that’s why he’s apolitical.”

“The exit will be so difficult,” said economist Joseph Brusuelas of Moody’s Economy.com. “Bernanke wants to engineer a recovery that does not include inflation. Obama wants a more robust recovery and like many political actors may be willing to forgo a little inflation for a little more employment.”

The White House is already worried that jobs won’t be coming back fast enough next year, Fed or no Fed.

Obama economic adviser Christina Romer warned a congressional panel Thursday that the jobs picture will remain “painfully weak” through 2010, with a seriously elevated unemployment rate for another year.

So all the White House can do is watch and wait, and hope it doesn’t pay a political price for any missteps by Fed officials they can’t control.

“It’s a dicey thing to do, and they know it,” said Sen. Richard Shelby (R-Ala.), the ranking member on the Senate Banking Committee. “They have to be careful.”

The Fed’s moves are shrouded in secrecy, their prerogative to move the levers of the economy closely guarded – so much so that there’s been a recent a rise in populist anger about this all-powerful agency that exists largely outside the democratic process.

But because the Fed is an independent agency, it’s even considered bad form for a president to talk much about it – and indeed, the White House refused to comment for this story.

Last fall, the Fed injected $ 1 trillion-plus into the nation’s banking system – at times, by providing financial institutions with cash to cover their losses as the global meltdown spread. Now Fed officials are already talking about the need to withdraw the funds injected into the economy during the darkest days of the crisis, moves that are credited with largely saving the United States from plummeting into an economic depression.

“Given the highly unusual economic and financial circumstances, judging when the time is appropriate to remove policy accommodation, and then calibrating that removal, will be challenging,” said Federal Reserve Vice Chairman Donald Kohn in a speech to the Cato Institute on Sept. 30. “Still, we need to be ready to take the necessary actions when the time comes, and we will be.”

Translation: “policy accommodation” is the cash, and “the necessary actions” are the decision to ease it out of the economy.”

And is the Fed prepared to the pull the trigger? “We will be” seems to cover it.

Already, the Fed is already showing some signs of restlessness. On Monday, the New York Fed tested its “reverse-repo” process — one tool the Fed could use to use to pull the money out when the time comes. The test run was widely interpreted as a sign the Fed is getting ready to act – but when, nobody knows.

The Fed can also tap on the brakes at the first sign of inflation by raising interest rates, now near zero. The Fed has said it will keep the rock-bottom rates for an extended period, but it won’t be more specific when they could go up – a decision that is bound to be controversial when it comes.

Patrikis thinks the Fed will make a decision on withdrawing liquidity either during the second quarter of 2010, or after the November elections that year – but that it won’t make any dramatic moves in the run-up to Election Day.

Still, he said, it is too early to predict what the Fed might do. And Patrikis points out that Obama will have indirect input into the decision, because there are two vacancies on the Fed’s board now that Obama will fill in the coming months. The president will surely select board members whose economic judgment he trusts.

Between the two vacancies, a member who Obama appointed earlier this year and Bernanke himself, the president will likely have named four of the seven members of the Fed’s Board of Governors by the time they make the call.

But the Fed knows actions like that can have political consequences. “There are few politicians who like higher interest rates,” said one former Fed official. “And President Obama is a politician.” That said, the official continued, “I suspect they will be broadly on the same page.”

That’s because Obama, too, has a longer-term time frame in mind: 2012, when he will be running for reelection. It’s in Obama’s interest for the Fed to take inflation prevention measures now so that he doesn’t have to run a tricky reelection campaign in a high-inflation environment.

Tensions between Presidents and Fed chairmen are nothing new.

In the 1980s, Fed Chairman Paul Volcker declared war on inflation. His strategy: raising interest rates. Volcker jacked the Fed funds rate to 20 percent, which contributed to the deep early 1980s recession that caused howls of protest from the White House and incumbent Republicans on Capitol Hill. The Fed, grumbled then-Senate Majority Leader Howard Baker (R-Tenn.), should “get its boot off the neck of the economy.”

Nonetheless, Volcker’s strategy worked, and the Fed broke the back of the inflation cycle. Ironically, Volcker is a top economic adviser to Obama today.

In the 1990s, President George H.W. Bush blamed Fed Chairman Alan Greenspan for his election loss to Bill Clinton. Bush didn’t believe Greenspan was lowering interest rates fast enough to pull the nation out of a recession – which gave Clinton, with his famous “it’s the economy, stupid” campaign, an opening to trounce the elder Bush.

Mark Gertler, a professor of economics at New York University, says the lesson of history is that politicians should not interfere with the central bank. “If the Fed doesn’t act independently, the economy is endangered,” said Gertler. “It would be dangerous if the administration appeared to be interfering with the Fed.”

Financial Services Committee Chairman Barney Frank (D-Mass.) doubts they’ll be any daylight between Obama and Bernanke – who Obama just reappointed over the summer at a time when Wall Street needed a signal that there would be continuity at the Fed.

He argues that Bernanke and Obama will have the same agenda in 2010: fixing the economy.

“I think they are very much in sync,” said Frank. Asked about potential divergence between the Fed and the White House, he said, “That reflects a journalist’s hope that there will be friction. Obama and Bernanke have both argued that at some point they’re going to unwind this.”

Americans choose every day to give away more of their country and future to corporations like mine. With each new stimulus, more of America becomes mine. Than you America! You are the best serfs in the world! You accept little and give much.

~Jaypee

Unemployment benefits extension
By year-end, an estimated 1.3 million jobless workers will have run out of unemployment benefits, according to the National Employment Law Project.

It’s expected that lawmakers won’t let that happen.

The House has already approved an extension and the Senate has amended it but not yet voted on it. Both parties say they want to extend benefits but they disagree over how to pay for it and how to handle amendments to the bill.

In the Senate proposal, unemployment benefits would be extended by up to 14 weeks in every state and then another six weeks on top of that in states where the unemployment rate tops 8.5%.

Currently, states with unemployment rates topping 8% now offer up to 79 weeks of unemployment benefits, said Chad Stone, chief economist of the liberal Center for Budget and Policy Priorities. States with unemployment rates between 6% and 8% now offer up to 59 weeks. And all other states currently offer up to 46 weeks.

Estimated cost: $2.4 billion. But Senate Democrats say the proposal would be paid for in full by extending an add-on tax for employers under the Federal Unemployment Tax Act.

For the past 32 years, employers were required to pay an additional 0.2% on the first $7,000 of a worker’s annual wages on top of the 0.6% they normally pay, said George Wentworth, a policy analyst for NELP. That surtax was supposed to expire this year. But lawmakers would extend it through June 30, 2011, to pay for the benefits extension.

If they do, the Congressional Budget Office estimates such a move could reduce the deficit by $200 million over 10 years.

Cobra premium subsidy extension
The White House supports extending the federal subsidy now offered to unemployed workers who opt to continue their health insurance coverage from their former employers.

Under the original provision passed under the economic recovery act, Uncle Sam agreed to pick up 65% of the cost of the Cobra premium for up to nine months for workers laid off between Sept. 1, 2008, and Dec. 31, 2009.

That 65% comes close to replicating the share of the premium typically paid for by employers when a worker signs up for coverage.

To date, a Cobra extension has not been attached to any proposed legislation.

Estimated cost: The original provision was estimated by the CBO to cost roughly $25 billion. Absent the exact parameters for an extension, however, it’s too early to tell how much the provision would cost.

There will likely be a cost to employers as well. The publication Business Insurance reported recently that companies typically pay out $1.50 in claims for every $1 collected in Cobra premiums.

Emergency payment to seniors
To compensate for the fact that there will be no cost-of-living adjustment made to Social Security benefits in 2010 due to a lack of inflation, President Obama has proposed sending a $250 economic relief payment to seniors, veterans and the disabled next year. It would be identical to the $250 emergency payment sent out earlier this year under the economic recovery law.

Democratic leaders in the House and Senate have voiced their support for such a payment.

But others don’t think it’s a good idea. The Committee for a Responsible Federal Budget notes that the cost-of-living adjustment for 2009 was much higher than average — 5.8% — due to record energy prices. So “even holding Social Security benefits steady means they will have increased in value. There is no economic or moral justification for increasing them further,” said CRFB president Maya MacGuineas in a statement.

To date, a proposed emergency payment to seniors has not been attached to any legislation.

Estimated cost: The measure would cost $13 billion, according to White House estimates.

Homebuyer tax credit expansion
An estimated 1.4 million tax filers to date have taken advantage of a temporary first-time homebuyer tax credit aimed primarily at people making less than $75,000 ($150,000 for joint filers). An estimated 15% of them bought their home specifically because of the tax break.

The latest iteration of that credit is worth $8,000, and it’s scheduled to expire on Nov. 30.

Many lawmakers want to extend that deadline, expand eligibility beyond first-time homebuyers and include those who make more than is allowed under the current rules.

Sen. Johnny Isakson, R-Ga., and Sen. Chris Dodd, D-Conn., co-sponsored an amendment to the unemployment extension bill that would extend the credit until the end of June 2010 and be available to single filers making up to $150,000 and joint filers making up to $300,000.

The amendment may or may not remain attached to the unemployment bill — which has been stalled due to political skirmishes between Democrats and Republicans. But Congress Daily reports that senators and aides “said both [measures] appear likely to clear the chamber in some form this fall.”

It’s still not clear where the White House stands. At a Senate Banking hearing on Tuesday, Housing Secretary Shaun Donovan said “within a few weeks we’ll have sufficient data to get to a conclusion on this.”

Estimated cost: The Isakson-Dodd bill is estimated to cost $16.7 billion. Isakson said at the Senate Banking hearing that he’d be happy to look for ways to pay for it and Dodd concurred. Typically, if a measure is considered stimulus it is not something that lawmakers feel obligated to pay for by either reducing spending or raising revenue in other areas.

Jobs credit creation
Although no formal proposal has been made, there has been some talk of creating an employer tax credit for hiring new workers.

The idea is to spur job creation and to do so in the face of forecasts for a 10% unemployment rate in 2010.

But it’s hard to do that without rewarding companies that were already planning to hire anyway, said Clint Stretch, managing principal for tax policy at Deloitte Tax.

Consider two competitors who dealt with the downturn differently, Stretch said. One made deep cuts to its workforce and is ready to ramp up again, while the other cut costs but managed to do so without laying off too many people. In this instance, the first company benefits far more from the credit than its competitor.

A hiring credit was put in place during the Carter administration and the consensus among researchers is that two-thirds of the 2.1 million jobs created by the credit would have been created without it, according to a post on Tax Vox, a blog of the Tax Policy Center edited by Howard Gleckman.

“Tim Bartik [of the W.E. Upjohn Institute for Employment Research] and John Bishop [of Cornell University] … argue it nonetheless created 700,000 new jobs in a year – not bad, even if a lot of money was wasted. Others insist the research they used is flawed,” Gleckman noted.

Estimated cost: Bartik and Bishop estimate that a job creation tax credit that refunds to employers 15% of new wage costs in 2010 and 10% in 2011 could create 5.1 million jobs at a cost of $27 billion, or $5,400 per new job created.

NEW YORK (Reuters) – JPMorgan Chase & Co reported a sharp rise in third-quarter results as underwriting revenue at its investment bank offset deeper losses on credit cards and other consumer loans.

The second-largest U.S. bank posted net income of $3.6 billion, or 82 cents a share. That compares with $527 million, or 9 cents a share, in the year-earlier quarter.

Analysts on average had forecast earnings of 52 cents a share, according to Thomson Reuters I/B/E/S.

JPMorgan shares were up more than 2 percent in premarket trading at $46.75. The shares closed at $45.66 on Tuesday on the New York Stock Exchange.

The Nasdaq just reached a multi year high, so my answer is ‘who cares?’. me and all my buddies have made more money during this depression, recession, crisis, than during any other time of our lives…sure, the data is grim for everyone who isn’t already uber-rich, but hell, we’re even going to get to start determining who wins elections in the U.S.A. For you it may be the worst of times, but for me and mine, this is certainly the best of times. This is no great depression, it’s a fantastic depression!

Here’s the deal.

* The US is in the midst of the steepest decline in home price on record.
* Short-term treasury yields went negative and are still close to zero.
* Long-term treasury yields hit record lows.
* Foreclosures hit record highs.
* The stock market had the biggest collapse since the Great Depression.
* U-6 unemployment is a whopping 16.8% and still rising.
* The PPI (producer price index) had the biggest drop in 59 years.
* The CPI is at -1.3% is declining at the fastest pace since 1950 according to government calculations. The real CPI by my calculations is -6.2% (See What’s the Real CPI? for details).

U-6 does not count recent graduates looking for a job but living at home in search of one. It also does not count self-employed real estate agents who have not made a sale in a year. However it does count all the “self-employed” selling trinkets on Ebay making $200 a month or less. I do not have totals for that, but structural unemployment plus structural underemployment is likely North of 20%.

I find this to be very good news. Thank you America! – Jaypee Morgan.

When the credit crisis struck last year, federal regulators pumped tens of billions of dollars into the nation’s leading financial institutions because the banks were so big that officials feared their failure would ruin the entire financial system.

Today, the biggest of those banks are even bigger.

J.P. Morgan Chase, an amalgam of some of Wall Street’s most storied institutions, now holds more than $1 of every $10 on deposit in this country. So does Bank of America, scarred by its acquisition of Merrill Lynch and partly government-owned as a result of the crisis, as does Wells Fargo, the biggest West Coast bank. Those three banks, plus government-rescued and -owned Citigroup, now issue one of every two mortgages and about two of every three credit cards, federal data show.

“It is at the top of the list of things that need to be fixed,” said Sheila C. Bair, chairman of the Federal Deposit Insurance Corp. “It fed the crisis, and it has gotten worse because of the crisis.”

Fresh data from the FDIC show that big banks have the ability to borrow more cheaply than their peers because creditors assume these large companies are not at risk of failing. That imbalance could eventually squeeze out smaller competitors. Already, consumers are seeing fewer choices and higher prices for financial services, some senior government officials warn.

Officials waived long-standing regulations to make the deals work. J.P. Morgan Chase, Bank of America and Wells Fargo were each allowed to hold more than 10 percent of the nation’s deposits despite a rule barring such a practice. In several metropolitan regions, these banks were permitted to take market share beyond what the Department of Justice’s antitrust guidelines typically allow, Federal Reserve documents show.

“There’s been a significant consolidation among the big banks, and it’s kind of hollowing out the banking system,” said Mark Zandi, chief economist of Moody’s Economy.com. “You’ll be left with very large institutions and small ones that fill in the cracks. But it’ll be difficult for the mid-tier institutions to thrive.”

“The oligopoly has tightened,” he added.

Last October, when the Fed was arranging the merger between Wells Fargo and Wachovia, it identified six other metropolitan regions in which the combined company would either exceed the Justice Department’s antitrust guidelines or hold more than a third of an area’s deposits. But the central bank thought local competition in each of those places was sufficient to allow the merger to go through, documents show.

Camden Fine, president of the Independent Community Bankers of America, said those comments reveal the government’s preferential treatment of big banks. He doubted whether the Fed would approve the merger of community banks if the combined company ended up controlling more a third of the market.

“To favor one class of financial institutions over another class skews the market. You don’t have a free market; you have a government-favored market,” he said. “We will never have free markets again if you have the government picking winners and losers.”

The kids in the pr department just brought me this. Thought I would pass it on to the rest of you. I’m going to have to give that Dimon a raise. Jamie, come on out on the superyacht this weekend. I’ll have the G-5 bring you to the Adriatic so you can join us for some caviar.

Jamie Dimon, the CEO of JPMorgan Chase, considered by many to be the country’s most influential and successful bank executive, can add another title to his resume: Accidental media mogul.

That’s right. The banker, thanks to the sagging economy, which has cratered several media giants leaving the lender in the driver’s seat, now holds sway over Readers Digest, Source Interlink Media and American Media Inc. — which have combined revenues of about $5.04 billion.

That’s more than Time Inc., generally considered the nation’s No. 1 magazine publisher with its stable-leading Sports Illustrated and People titles helping it ring up $4.6 billion in revenue last year, and the combined revenue of Hearst, publisher of Esquire, and Condé Nast, the parent of Vogue.

Together, Dimon’s line-up posted a 2008 operating profit of about $470 million. In contrast, Time Inc. had a $6.4 billion operating loss after impairment charges of $7.2 billion. Its EBITDA was $1.05 billion.

And Dimon’s media line-up doesn’t include JPMorgan’s role as a banker in the still unraveling bankruptcy of Sam Zell’s Tribune Company, which just spun off the Chicago Cubs.

Dimon finds himself the accidental and reluctant media mogul thanks in large part to the LBO boom that ended in 2007. Private equity loaded up the publishers with too much debt — and when business faltered, Dimon and other lenders swooped in to take control.
(more…)

Ignore that trillion dollar bump!

We really don’t understand what all these doomers are going on about, the recovery is here and the future is brighter than ever.  In fact, just the other day I was about to dive off my yacht off the French Riviera, but realized I didn’t have my designer speedos.  I looked at my favorite economic indicators, and realized this was a too big to fail type of problem.  I wound up taking the helicopter back to my schloss in Lichtenstien to get exactly the pair I wanted.  Needless to say, spending a few thousand Euros to go get my favorite mankini impressed my date to no end.

And I like a date who appreciates a speedo connoisseur.  After all, she charmed her way into a couple days of my schedule by asking me “Ben, where is the Cannes Film Festival going to be held this year?”

She is priceless, and to let you in on a little secret, she is my sounding board for my best unreliable advice.  She is also a perfect econometric model of what the American political system is shooting for in terms of an electorate.

Ok, so now the advice part.  First, disregard Robert Prechters recent forecast that the stock market is about to drop like we haven’t seen in 200 years.  Second, invest in commercial real estate.  This type of investment can happen at any level–for example, you may want to become a janitor in a commercial building if you really want job security, or you may want to buy a few buildings.  Either way, commercial real estate is the new superhot market that will save the global economy.  Even if you have no credit, you’ll probably be able to get a hold of five or six buildings, and then sell them when they’re worth double.

But don’t take my word for it.  Check out what Elizabeth Warren has to say–and remember, she’s on TV which means everything she says is at least as unreliable as everything I write.  Where I take issue with her is when she says we still have all the same problems we had when this so-called economic contraction began.  Not true!  If you’re a big bank, you’re making more printed money than ever!

Until next time,

Ben Wachtoff