Hey there! This has been a good day in the markets with some of that stability that we seem to be seeing more of lately.
Goldman Sachs was placed under investigation this week for their practices that were a part of the "mortgage" meltdown. I heard a great analogy for what they were doing: Imagine if a contractor built a home with crummy materials knowing that their home would shortly fall apart. Then, they took out an insurance policy on the home. Now imagine if they sold the home to you! In a way, they sold securities that they knew represented bad debt, so they insured them for themselves. When the whole thing went up in flames, they already had the money from the investors who bought their product AND were able to get paid on the Credit Default insurance policies they had in place.
YES, this is a broad generalization and over simplified. The fact of the matter is: the instruments were SO complicated that a vast majority of those who invested in them didn't understand them at all. This is dangerous.
Some feel the Goldman Sachs thing is a "witch hunt" to demonstrate the further need for "overhaul" of the financial industry. Hmmm.
FNMA 4.5% Mortgage Bond held steady today after some big wins last week and big losses yesterday. We closed the session with the mortgage backed security quote at $100.19 so DEAD even on the day.
Dow closed up over 11,000 and has been hovering there. In general, we are showing some great signs that things are turning around! It has been great to see so much of my retirement money recovering as it has been marinating for the last 18 months or so in negative territory.
Return to Confidence: Despite the media machine's efforts to renew our confidence, the truth is that many of us are not "feeling" as wealthy as we were a few years ago. EVEN if that is not the case at all. The return of the investment portfolio values for some of us really helps but is not enough. There seems to be fewer people holding onto the notion that things are getting worse and that is a good sign but overall we have a long way to go before it "feels" like we are out of a recession...even though we likely ARE technhically on the other side of it.
RE-TOOL: I have spent many, many hours re-tooling my business to accomodate my new delivery process. I have officially launched my "Premium Service Delivery Platform (tm)" and it has completely transformed the way I think about my business. If you would like to learn more about this guaranteed service delivery process let me know, I am excited to share.
Have a great day!
Chad
Chad
