Saturday, December 30, 2006
Friday, December 29, 2006
Biggest bubble of 'em all
I briefly talked about the housing bubble, and I encourage my readers to research it.
But the biggest, scariest bubble, the fat mama of all bubbles, is the derivatives bubble.
What the heck is a derivative? Basically, it's a hedge fund. We've all heard that term, even if we don't understand exactly what it means. I barely do, so please follow the links and read 'em.
Since I've never had enough money to invest in anything, I have trouble getting my brain around all this weird financial stuff ;-). Derivatives primer here.
I've long thought of investing in the stock market as gambling. It is, and yet it isn't. Technically, stockholders own something that's [hopefully] of value - a piece of a company.
A derivative is much more speculative. It's a wager on the future price of an investment in an underlying market. It's like the futures market for stocks, bonds and commodities, except more so. It can even be a hedge on a hedge, and thinking about that one makes me dizzy.
The volume of derivatives traded is huge - many times bigger than the global GNP. Yet it creates nothing. So a ginormous amount of money is changing hands all over the world, wagers done on margin, and the money doesn't exist. How can it? It's bigger than the world GNP. It's a gigantic weird complicated impossibility.
It's a bubble.
What does this all mean? When the derivatives bubble bursts, the stock bubble and Crash of '29 will look like a mere blip by comparison.
Here's Warren Buffet on the topic, very worthwhile reading.
What to do? Live below your means. Put by some extra food. Learn a new DIY skill. All of these are good planning for hurricane country anyway. There are folks that recommend keeping some silver or gold coins at home in case banks collapse.
And if you pray, it's prolly a good time to do that too.
PS - The big spaces between paragraphs are because of blogging through Performancing Firefox. Sorry 'bout that!
But the biggest, scariest bubble, the fat mama of all bubbles, is the derivatives bubble.
What the heck is a derivative? Basically, it's a hedge fund. We've all heard that term, even if we don't understand exactly what it means. I barely do, so please follow the links and read 'em.
Since I've never had enough money to invest in anything, I have trouble getting my brain around all this weird financial stuff ;-). Derivatives primer here.
I've long thought of investing in the stock market as gambling. It is, and yet it isn't. Technically, stockholders own something that's [hopefully] of value - a piece of a company.
A derivative is much more speculative. It's a wager on the future price of an investment in an underlying market. It's like the futures market for stocks, bonds and commodities, except more so. It can even be a hedge on a hedge, and thinking about that one makes me dizzy.
The volume of derivatives traded is huge - many times bigger than the global GNP. Yet it creates nothing. So a ginormous amount of money is changing hands all over the world, wagers done on margin, and the money doesn't exist. How can it? It's bigger than the world GNP. It's a gigantic weird complicated impossibility.
It's a bubble.
What does this all mean? When the derivatives bubble bursts, the stock bubble and Crash of '29 will look like a mere blip by comparison.
Here's Warren Buffet on the topic, very worthwhile reading.
What to do? Live below your means. Put by some extra food. Learn a new DIY skill. All of these are good planning for hurricane country anyway. There are folks that recommend keeping some silver or gold coins at home in case banks collapse.
And if you pray, it's prolly a good time to do that too.
PS - The big spaces between paragraphs are because of blogging through Performancing Firefox. Sorry 'bout that!
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Tuesday, December 26, 2006
Advice for the New Year
I've spent the better part of the year reading about the Housing Bubble at Housing Panic, among other sites. Google "housing bubble," read and weep.
Some predict a full-blown Depression will result from the greed, with bank failures and massive unemployment and homelessness. Others claim we'll go through an inflationary period with static wages.
To help my friends and readers live below their means and prepare for the future, some favorite DIY and economizing sites:
Hillbilly Housewife
Do-it 101
DIY Network
Ron Hazelton
BuildIt Solar - save energy!
Frugal Homemaker
Miserly Moms
Frugal Families
More in another post :-).
Some predict a full-blown Depression will result from the greed, with bank failures and massive unemployment and homelessness. Others claim we'll go through an inflationary period with static wages.
To help my friends and readers live below their means and prepare for the future, some favorite DIY and economizing sites:
Hillbilly Housewife
Do-it 101
DIY Network
Ron Hazelton
BuildIt Solar - save energy!
Frugal Homemaker
Miserly Moms
Frugal Families
More in another post :-).
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Friday, December 22, 2006
Another Louisiana blog
Found it at We Saw That:
CenLamar.
They get a lot of visitors - give 'em a few more! Good reading about our neighbors to the west. Whoops, all of our Louisiana neighbors are to the west, lol.
Will add it to the blogroll ASAP - when Darling Son isn't itchin' to play Second Life
CenLamar.
They get a lot of visitors - give 'em a few more! Good reading about our neighbors to the west. Whoops, all of our Louisiana neighbors are to the west, lol.
Will add it to the blogroll ASAP - when Darling Son isn't itchin' to play Second Life
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Speaking of real estate...
I went over to Realtor.com and looked up what's for sale in 70427. 79 properties as of this moment.
Seems a bit odd to see a number of apparently livable small homes offered for around $50k, and only one rental. We short of rental property here? I didn't know.
The Daily News classifieds have a few homes for rent - One for $700, and one offered at $550 per month or buy it for $42k.
Are the apartments in Bogalusa all full? Or don't they advertise?
Seems a bit odd to see a number of apparently livable small homes offered for around $50k, and only one rental. We short of rental property here? I didn't know.
The Daily News classifieds have a few homes for rent - One for $700, and one offered at $550 per month or buy it for $42k.
Are the apartments in Bogalusa all full? Or don't they advertise?
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NAR will bite the dust?
Via the Marin Real Estate Bubble blog:
Here are the filings at the DoJ site, for you legal beagles who understand such stuff.
A Chicago district court cleared the way Tuesday for the Department of Justice to proceed with its antitrust lawsuit against the National Association of Realtors (NAR).Hmmm. The internet results in better, lower-priced service, and the dinosaur NAR acts like a jerk and tries to protect their interests.
The DoJ contends the NAR is engaging in anti-competitive behavior against online home brokers.
Here are the filings at the DoJ site, for you legal beagles who understand such stuff.
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Daily News Watch
They didn't update their site in an age.
Now they have. But if you search the archives for articles between Dec. 7 and Dec. 19, there's nothing, nada, zero, zip.
Sheesh.
Wednesday, December 20, 2006
Saturday, December 16, 2006
A-maze-ing
Corn maze in Hickory. Or maybe it's a maize maze?
Closed this year due to Katrina. Open again in 2007.
Sounds like a fun activity with the kids, huh?
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