HOW NOT TO INVEST

For many years I’ve observed the investment habits of my fellow Americans.  All told, it has not been a pretty picture.  What some persons resort to in an attempt to put their assets to work profitably often approaches insanity.  This subject deserves scrutiny; let’s look closely at what should and should not be done.

It’s my belief the basis of all sound investment is something which generates a clearly predictable cash flow.  So, for example, if you decide to acquire corporate stocks, you’ll choose from among those which regularly pay an adequate quarterly dividend.  There are, of course, securities which meet this requirement.  If, instead, your taste runs to real estate, you’ll do best with rental property in which the rents collected exceed the anticipated expenses by enough to constitute a decent return on your investment.  And that’s the key word: Investment.

Which gets us to the topic’s title: How not to invest.  What transpires for most Americans is not investment—it’s something else.  If you’re typical, your assets have been relegated by an “advisor” into one or more mutual funds.  The only predictable cash flow experienced will be to your advisor and to the fund management, both of whom regularly skim their percentages off the top of your assets, regardless of performance.  Your profit, as your advisor will assure you, will be in the distant future, guaranteed by the inevitable rising economic tide by which all vessels will likewise rise.

As bleak as it may be for the typical mutual fund holder just described, things can be even more uncertain.  If, for some reason, you choose to chase hot promotions, you’ll find yourself in the world of speculation.  Possibly today’s hottest is Tesla Motors, a firm which has wrapped itself into solar energy and governmental tax credits.  Though the firm has failed to ever generate an operating profit, its common stock trades in the $200 range, with many analysts predicting nothing but the best.  If you’re the sort of person inclined to draw one card to fill an inside straight, be my guest.

A final thought: I advise you to be especially wary of professional financial planners.  My underlying aversion to the omniscient investment advisor is the inherent contradiction of human nature.  I believe that no one who truly knows what the financial future holds willingly divulges that information to the general public. 

♦          ♦          ♦          ♦          ♦

If you enjoy this weekly Straight Talk by Al Jacobs, you’re invited to check out my monthly Financial Newsletter, as well as my new book, The Road to Prosperity

Click onto http://www.onthemoneytrail.net/

♦          ♦          ♦          ♦          ♦

 

 

AMERICA'S WAR CRIME ATROCITIES

The April 30th announcement is clear and unambiguous: Sixteen U.S. servicemen, including a general officer, are to be disciplined for their involvement in an attack last October on a hospital in Kunduz, Afghanistan.  The military’s central command confirmed none of the persons charged “knew they were striking a medical facility,” and acknowledged the attack was the result of hundreds of errors compounded by “process and equipment failures.”  Nonetheless, the punishment to be administered will include suspensions, letters of reprimand and removal from command.  Apparently even this official redress does not satisfy the various human rights groups who accuse the servicemen of war crimes and demand criminal action against them.

There’s poetic irony in this pronouncement on April 30.  It was on this date in 1974 that North Vietnam forces swept into Saigon, consummating their conquest of South Vietnam and thereby achieving victory over the U.S.  Not since 1945, at the conclusion of World War II, has our nation achieved clear-cut success in any military endeavor.  Despite our economic and technological superiority, we consistently falter and lose to our enemies.  General Douglas MacArthur explained why: “It is fatal to enter any war without the will to win it.”  Yet in every conflict we’ve entered over the past seven decades, we’ve deferred to the critics, pacifists and apologists.  And we’re continuing to function this way now.  As a case in point, Secretary of State John Kerry is now scrambling to resuscitate a defunct Syrian truce by turning for help to Russia—an ally of Syrian President Bashar al-Assad.  What in God’s name are we doing?

Possibly we have no business in the Mid East.  If so, we ought to withdraw.  If, however, our best interests require an armed presence and active participation, we should be involved with a will and presence to prevail.  And accusations which accuse us of employing excessive force deserve to be ignored.  We once functioned in this manner.  Civil War General William Tecumseh Sherman stated it clearly: “Every attempt to make war easy and safe will result in humiliation and disaster.  War is cruelty.  There is no use trying to reform it.  The crueler it is, the sooner it will be over.” 

One thing is clear.  If we, as the most powerful nation in the world, have not the willingness to exert the military superiority we possess to further our national interests, then our enemies deserve to best us in Syria, Iraq, Afghanistan and elsewhere.

♦          ♦          ♦          ♦          ♦

If you enjoy this weekly Straight Talk by Al Jacobs, you’re invited to check out my monthly Financial Newsletter, as well as my new book, The Road to Prosperity

Click onto http://www.onthemoneytrail.net/

♦          ♦          ♦          ♦          ♦