If your 401(k) was crushed from 2000-2002, then here is your chance to avoid a repeat.Risks of a blow up occurring in the convoluted world of "structured finance" are so high right now, it is only a matter of time before the stock market deeply craters.
You have you never heard of structured finance? Why it is the lynch-pin of the U.S. economy!
You need not take my word for it. Yet would you believe John Lipsky, the former co-chairman of J.P. Morgan Chase? Because that's what he said in 2002, during testimony before a U.S. Senate Committee investigating the collapse of Enron.
I have been a student of the financial markets for over twenty years now. You can believe I appreciate Mr. Lipsky's authority. You should too.
Structured finance, simply put, is a highly leveraged, 800-pound gorilla.
And I believe both the slow-down in real estate speculation and the growing travails of the auto industry (GM, Ford, Delphi) threaten some segment of credit markets whose life blood is structured finance and globalization.
If I am correct about this, you can expect "spill over" effects that stand to crush millions of 401(k) investors.
The day soon will come when your 401(k) investments should be out of the stock market. If "better safe than sorry" is your investment credo, then be alert for trouble.
How much better off you would be if you had stepped aside early in 2000, then got back in, early in 2003? This I would have advised you to do, if only you had known me.
Here's the thing: The secret to rapidly building wealth investing is discovered by those who avoid crushing losses like the plague.
Now, whether the risks I cited above will be the cause of a broad stock market decline sometime in the near future, no one can say with certainty.
What I can tell you, though, is market-moving professionals are concerned about something and they are betting the stock market will fall. Just so you know... The last time they were positioned this same way was in 2002 (a bad year for stocks). I wanted to make you aware of this.
Likewise, when the stock market slides, as I am anticipating it will, an easy opportunity to turn $500 into $15,000 - $30,000 trading stock index options will develop. If you are interested, come along for the ride. Get my free trade notification, and be patient. As always, you have to let opportunity come to you. You can believe it will, too, when you know what you are looking for.
Few people have a clue about structured finance. Yet, it has grown into a HUGE vulnerability. And a dangerous one, too, because there is so little appreciation for the inevitable "end game" when an abundant availability of cheap credit is put to unproductive use.
History, indeed, is littered with the dashed hopes and dreams of those seduced by similar, "hot," new things like structured finance, which, although an abstraction, is no different in its allure than the high tech arena was a few years ago.
Like King Solomon thousands of years ago, I too believe:
"Nothing under the sun is new, neither is any man able to say: Behold this is new: for it has already gone before in the ages that were before us." (Ecclesiastes 1:10)
I bring this up only because a "better safe than sorry" approach requires some sense of danger. And one danger simply is ignoring truth about the world we live in.
By no means have greed, graft and deception been regulated out of existence.
What's more, I believe these elements more or less dominate the financial scene these days. Yet, this is rarely acknowledged. Scarcely, either, is this reality properly feared. But isn't this always the way? Only when it is too late do most seek to realize the truth...
I hope you will be more alert to protect your 401(k). There are grave risks threatening, indeed.
