Talk, Talk< Inflation>Talk< Health Care>Talk, Talk

Is there anything left to talk about? And what does talk accomplish? Think about what you have been hearing lately… “Those people in Egypt rioting….it’s another sign of the end of the world”…”The biggest risk to America now is deflation”…”Gold will trade to $6000 an ounce very soon”…”It’s inflation that will result from the Fed’s QE2”…”Chinese Mother’s are superior”…”Illinois is going to ‘temporarily’ raise taxes to fix its budget”. Really? There are lots of talk shows out there these days giving people the forum to express their opinions cloaked as fact. The more folks that believe, the more ‘group think’ you get as a result. There is reported to be a million people lining the streets in Egypt today…and it all started with a tweet. What will the result of all this be? We do not yet know, but that doesn’t stop the talk. In the end its action that speaks louder than words.
People talk, but history tells the story. Will the world end through the actions of man or will people come together and live harmoniously for all of time? Let’s talk about it…

Ok, let’s talk healthcare. You have a problem, go to the doctor and pay for it. If the problem is too expensive to pay for, buy insurance for the catastrophes in life. Don’t have any money to pay for it? Visit a free clinic staffed by doctors and nurses paid for by government and insurance companies….or we can have a system government run and subsidized by taxes…the talk rages on and there is no shortage of it on this topic. History will tell us who won the debate.

Talk can be especially dangerous when speaking of the markets. Just turn on CNBC any day of the week and you will hear how the markets are going to crash and how the markets are going to the moon…many times within the same hour! And you know what?…they are both right. The markets will crash and the markets will go to the moon. History will tell us when that happened. As investors we are just along for the ride. Even the person who would never invest and keeps all his money in certificates of deposit because ‘stocks are like gambling’ is right, like a stopped clock, every market cycle. But, there are two big problems investors and savers both face and they are not market crashes and wild swings in interest rates. One of the problems is investors listening to the talk when these market events occur. “This time is different because….” The guy on the television has to get his message across to sell the product du jour. He can’t do that without your money. That’s why most investors buy high and sell low. History has taught us that already.

The other problem out there for anybody with a dollar in their pocket is inflation. Savers will get hit the hardest by inflation because the value of their purchasing power is dropping all the time and their savings can not keep up. We can talk about why the Fed has kept interest rates so low for so long, but what will that accomplish? It is what it is. History has taught us that markets will rise and fall, like the tide that ebbs and flows. When stocks are up, that’s not your money, unless you take it off the table and who does that in a skyrocketing market? When the market crashes you haven’t lost your money, unless you sell and that is so easy to do when panic sets in. Inflation is coming and markets will be volatile. All we can do is talk about it…

Talk Super Bowl anyone? I heard both the Steelers and the Packers are going to win!!

Have a great day out there…I just heard a blizzard is coming in case you missed it.