It's Time to Pay Attention

Anyone else get the feeling that our economy has gone haywire? Stocks are surging ahead, while our National Unemployment Rate stands at 10.2%. In case you're not an economist, that is the highest the unemployment rate since the early '80's. Small businesses all over are shutting their doors and abandoning their dreams of expansion and wealth. All you have to do is take a walk down Main Street America and observe the "For Lease" signs plastered across commercial storefronts. Foreclosures are still out of control as this new surge of Adjustable Rate Mortgages begin to "adjust". In the next year we are likely to see that number skyrocket.


Something is amiss for sure. But in any economic bloodbath there is immense opportunity.


One of the essential tools in our LOL toolkit is to pay attention to our personal finances and manage where our savings are going. I know a lot of friends that refuse to watch the news because it is too negative and they don't want to be bothered by all of the wars, violence and negative economic news. I also have friends who invest every month in aggressive mutual funds and have absolutely no idea how their portfolios are performing.



It is is time to pay attention to what is happening. Economies, governments and the habits of millions of people are rapidly changing before our very eyes. Watching economic and global events while staying emotionally detached provides you an advantage from the typical "Jon and Kate Plus 8" American who is hellbent on being entertained by mindless not-so-real reality TV while the world goes through an immense change.



Do you know that the US Dollar has lost 9 percent of its value in the past year? What does that mean? It means your savings account making 1 percent interest actually has lost eight percent in a year's time. That is why investors are moving their money out of banks and putting it in commodites and stocks. Gold has gone up 16 percent in the month of November 2009. This is an indicator that people are losing faith in paper currency. I believe US Stocks are in extreme peril right now. Do some research and find out for yourself.



The masses are starting to wake up and pay attention. My advice is to get educated on the current trends and forecasts for the upcoming year. Get investment advice from a variety of sources and then trust your instincts.



One thing is for certain. Consumerism is dying quickly and we will be faced with a new economy and new ways of creating value. If you are to maintain a good standard of living in the coming years, you need to manage your nest egg closely and consider operating from a paradigm of safety and wealth preservation as opposed to "getting rich." Working to reduce your needs and sell and discard what is unnecessary will assist you in this process.



The government wants you to get into debt (i.e. Cash for Clunkers and the Homebuyer Tax Credits). I am asking you to reconsider. Work to get out of debt and research investments that will increase in value during times of financial crisis. Staying liquid and mobile should be a factor with regards to your finances while our economy resets itself. Make no mistake, we are in for one hell of a wild ride.