Last night, I was chatting with a friend. Between our usual conversations on investments, mutual funds, insurance coverage etc, she called my attention saying that she got this email saying exactly what I was preaching. As a financial adviser, I would always encourage her to buy more investments during times like this. Why, simply because shares are almost on a bargain price. And that would simply follow the Investing Wisdom of the Wealthy.
Intrigued by what she was saying, I asked her to forward the email to me. And here’s the exact copy of the email. The italicized text are from the email. My comments are in straight blue font.
The recession looks very eminent. It is really time to take pro active steps to avoid a painful time in the next two years which is how long the recession is expected to last.
– If one knows exactly what happens to the US financial crisis, you will not be swayed even by an inch by statements like this without any concrete basis.
Suggestions:
- Don’t take any loans; buy homes, properties with loans, or even cash. Keep as much cash as possible.
– This is exactly true. Do not take loans if you cannot sustain the payment but not by any gossip.
- Pay off as much of personal loans, private loans, as debt collection will be hastened.
– Yes, we should always pay our debt, because if not, credit will build up due to interest.
- Sell any stocks you can even at lower prices.
– No brainer in my opinion. If you sell your stocks at lower prices, only one thing is for sure. LOSSES.
- Take money off from Trust Funds.
– Please do not. Trust Funds are made for a purpose. Leave it there.
- Don’t believe in huge sales forecast from customers, be extremely prudent, lowest inventories, reduce liabilities.
– Don’t believe if you don’t have enough basis or evidence.
- Don’t invest in new capital.
– Why not? The world isn’t going to end. And if in case, the best thing to do is to PRAY!
- If you are selling homes/ properties/ cars, do it now, when you can get good prices, they are going to fall.
– With cars, maybe, coz it’s always decrease in value. Properties, depending on location. If it’s in a squatter area, probably yes.
- Don’t invest in new business proposals.
– Why not? What will you do with your money, put it under the mattress? Haha.
- Cancel holiday plans using credit cards.
– This I must agree. Don’t spend anything you haven’t earned yet. Even if you already earned it, pay yourself first.
- Don’t change jobs, as companies will retrench based on ‘LAST IN FIRST OUT’.
– Don’t change jobs if the benefits, salary is lower. Otherwise, why not?
Stay cool, wait, and if you took all of the above actions and more, you probably will be better off then many. This is not a rumor. Bear Stearns is the first of many banking and financial institutions that will start falling in the not too future. If Bear Stearns can fall, so can JP Morgan, Citibank, HSBC, and the whole world. US economy falls, the rest will crumble.
– As long as these companies are earning, I don’t see any reason why will they fall. Again, if you know better, this is just some kind of gossip from a 3rd grader.
India and all those self economies will be the most protected, but not gullible. Europe may be a little stronger, but not China. Another giant place, Malaysia, will see significant impact. Be alert and pass this to your friends!!!
Sad to say but there are still some others who rides on negative events like this to scare more people. These are nothing but black propaganda and would only want to see chaos. Wouldn’t you want to see a prosperous world? A better Philippines?
And if we are not educated at all, chances are, we’re all victims. We’ll believe emails like this in an instant. But its a lot different now. We’re now educated. We know better. And we’re not financially stupid.
If most people will believe in this kind of emails, then most likely, it may happen. Based on history, these are the times when the market is acting on fear and not on logic.
Act based on Logic and not on Fear. Before you take an action, research first. These are nothing but junk.
(I’ve made some investigation as to the original sender of the email and as to where the link was pointed. No wonder the email mentioned that India will be the most protected. The author is from India. Now that makes sense.)
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