Kavmerica.com

Guest Contributor: Mark

http://www.planbeconomics.com

With the S&P 500 trading in the 700 range, it is time to consider some long-term investing ideas that you can buy and forget about for 10 years. We’re not talking about buying investments for the sake of buying investments. Nor are we talking about buying investments just because they’ve been beaten down.

What we are looking at here are 5 long-term themes that you can really sink your teeth into…big, broad themes that will probably impact the world for at least the next 5-10+ years.

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Racial Profiling has become a hot button issue.  Some are quick to say that race should never be used as a factor when it comes to screening for potential threats.  However, should that always be the case?  At what point would you say it is okay?  What if it were possible to eliminate 100% of the threats out there by using racial profiling, would you be in favor of it then?  What if racial profiling could save lives?

Often people are in favor of profiling when it doesn’t affect them.   It’s difficult to put ourselves in their shoes and feel as they do when someone else is being discriminated.   Take for example the Arab population.   The vast majority of Arabs are no threat at all.  However some would argue that since 1983 that the US Embassy Bombing in Beirut, Marine Barracks Bombing in Beirut, The Hijacking of the Achille Lauro, The bombing of Pan Am Flight 103, The 1st World Trade Center Bombings, Empire States Building Shootings, 9/11 World Trade Center Attack, Shoe Bomber Richard Reid, and the El Al Ticket Counter Shootings (To name a few) provide a legitimate reason to target Arabs with racial profiling.

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In case you don’t already know, the bailout is a joke… on you. Thus far none of the $350 million Congress has released has gone home owners. Although that shouldn’t be a surprise when you consider the man who is running the bailout program, Henry Paulson, worked on Wall Street before coming to Washington. He has made it a priority to make sure his cronies on Wall Street got their fill at the US tax payers expense.

Want some of that bailout money? Too bad you’re not a bank cause the form to request the money is ridiculously simple.  Just two pages that you need to fill out, see for yourself: Bailout Application

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Over the past century there has been a discernible shift in the way we invest in companies here in the US. Gone are the days when people invested in companies for the long haul. Short term investing has increased almost exponentially in the past decade or so with the rise of Internet trading. Just about anyone these days can sit down at a computer and start trading within a few minutes or so. A few minutes later they can sell their first trade back and attempt to profit on that spread.

Companies traded on Wall Street have become very attuned to this fact and have shifted their business models to generating as much short term return as possible at the expense of long term stability, customer service, and long term growth. This has help lead the economy to the point where it is on the edge of collapse.

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A lot of people are asking themselves the question: “What should I do with my 401K during this recession?” It’s a complicated question and in many cases the response is… nothing. The market is already down, what can you do? Sell now? You’ll just guarantee that you lose even more money. There is an old adage “Never catch a falling knife” and that is what you are trying to do when you sell your stocks after the damage is done.

If you’re still a ways off from retirement there really is no reason to panic. Sure it’s never fun to look at your 401K balance and see so much of it missing. However try to look at this as an opportunity. If you keep investing your going to be buying up these stocks at bargain prices and 5-10 years from now you’ll be able to look back on this and smile about the bargains you got. The market will go back up. After every recession/depression in US history there has been a rebound and there is absolutely no reason to think that it wouldn’t happen this time. We have fallen on some hard times but there will be greener pastures ahead.

If you are a little older and getting closer to retirement then hopefully you had already started moving your money out of investments that were as risky as the stock market. If you didn’t then all is not lost. Considering trying to wait another year or two before retirement. That is an enormous decision to make but if you start withdrawing your money while the market is still depressed you’re going to burn through it a lot faster than you thought you would. In the mean time consider putting any new money entering the account into investments that, while the return may be smaller, give a more stable return and won’t depreciate in value. Most kinds of bonds fall into this category.

It isn’t easy but try to keep your head up. The economy will eventually come out of this slump and it is possible to make your money back and then some if you have the right investment perspective.