Steering Your Way Through the Economic Tempest
America has been on a heightened state of alert since September 11, 2001, ever on guard against terrorists seeking to destroy our capitalist, free enterprise system from without.
But, while we were watching our borders, another sinister threat to our nation was silently spreading within - from Wall Street to Main Street - a form of corruption that invaded our lives unseen and attacked the foundation of our homes the way the way black mold rots the wooden support beams until the entire structure collapses under its own weight.
Easy credit spread the contagion that infected the global financial system and, over night, left millions bereft or worried sick about their future.
"For Sale" signs sprouted like mushrooms on front lawns as one home after another slid into foreclosure.
Major banks and insurance companies vanished over night in the quagmire called the sub-prime mortgage mess.
For the first time, we began hearing about "credit default swaps," an unregulated form of debt insurance, which the legendary investor, Warren Buffett, had warned were "weapons of mass financial destruction.
" Turns out the Oracle of Omaha was right again - global financial markets have nearly melted down.
But the doleful drumbeat of depressing news has distorted the reporting of many news outlets.
The endless 24/7 news cycle, and the need to fill the air waves with a constant stream of yammering bobble head broadcasters, creates a feedback loop that changes the original story, amplifies its importance and distorts its meaning in the same way that an echo muddles the original sound.
Opinions pass for facts as one talking head panelist tries to outdo the other.
The result is distracting, disturbing sensationalistic reporting that rattles the nerves and leaves viewers in a heightened state of alert, waiting for the next news bulletin to crawl across the bottom of the TV screen.
The greatest terror we face is panic and the irrational impulse to leap without looking.
For every investor who jumps out of the market, someone else jumps in to buy the liquidated shares.
Guess who is buying now? Warren Buffett.
In a letter to the "New York Times," he said, "Buy American.
I am.
" As he sees it, stocks are selling at bargain prices today..
Right now, the markets are being driven by fear rather than fundamentals.
But eventually, the sweeping initiatives by the world's top bankers will stabilize the markets, trust will be restored and financing will become available once again.
We are in for a recession, possibly a deep and protracted one, but the winds of change may steer us in the direction we were meant to pursue all along.
Meanwhile, we may have to "girt our loins" - tighten our belts, cut our expenses - and vigilantly wait for the better times that lie ahead.
But, while we were watching our borders, another sinister threat to our nation was silently spreading within - from Wall Street to Main Street - a form of corruption that invaded our lives unseen and attacked the foundation of our homes the way the way black mold rots the wooden support beams until the entire structure collapses under its own weight.
Easy credit spread the contagion that infected the global financial system and, over night, left millions bereft or worried sick about their future.
"For Sale" signs sprouted like mushrooms on front lawns as one home after another slid into foreclosure.
Major banks and insurance companies vanished over night in the quagmire called the sub-prime mortgage mess.
For the first time, we began hearing about "credit default swaps," an unregulated form of debt insurance, which the legendary investor, Warren Buffett, had warned were "weapons of mass financial destruction.
" Turns out the Oracle of Omaha was right again - global financial markets have nearly melted down.
But the doleful drumbeat of depressing news has distorted the reporting of many news outlets.
The endless 24/7 news cycle, and the need to fill the air waves with a constant stream of yammering bobble head broadcasters, creates a feedback loop that changes the original story, amplifies its importance and distorts its meaning in the same way that an echo muddles the original sound.
Opinions pass for facts as one talking head panelist tries to outdo the other.
The result is distracting, disturbing sensationalistic reporting that rattles the nerves and leaves viewers in a heightened state of alert, waiting for the next news bulletin to crawl across the bottom of the TV screen.
The greatest terror we face is panic and the irrational impulse to leap without looking.
For every investor who jumps out of the market, someone else jumps in to buy the liquidated shares.
Guess who is buying now? Warren Buffett.
In a letter to the "New York Times," he said, "Buy American.
I am.
" As he sees it, stocks are selling at bargain prices today..
Right now, the markets are being driven by fear rather than fundamentals.
But eventually, the sweeping initiatives by the world's top bankers will stabilize the markets, trust will be restored and financing will become available once again.
We are in for a recession, possibly a deep and protracted one, but the winds of change may steer us in the direction we were meant to pursue all along.
Meanwhile, we may have to "girt our loins" - tighten our belts, cut our expenses - and vigilantly wait for the better times that lie ahead.
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