Matt Carberry (kingpin248) wrote,
Matt Carberry
kingpin248

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Down comes the sky...

...and the impact point is squarely at the corner of Wall and Broad Streets in Lower Manhattan. It started with Bear Stearns a few months ago. Then came the takeover of Fannie Mae and Freddie Mac. Now, American International Group is the latest financial concern to come under the umbrella of the federal government. At the same time, no such bailout was offered to Lehman Brothers, and that investment house will find itself broken and sold off.

What should we take from all this turmoil in our financial markets? I think the lesson is that some of the basic tenets applicable to life in general bind the world of business as well. That is to say, while you must take risk if you seek greater reward, taking on too much leads to teetering and ultimately to collapse.

On principle, the bailouts don't sit well with me. The people who made the bad calls with their money should bear the brunt of their decisions; the various federal interventions disconnect the consequences from those responsible for them. I'm also not a fan of what appears to be a massive exposure of taxpayer dollars to investments of questionable quality. But I concede that being here underwater, off the coast of "none of your business," I'm not privy to all the details of what's happening. I'm very interested to read up more on this once we're back on dry land.

Finally, as for my own personal finances, I note two points. For one, I'm thankful that nearly all of my assets are of the cash form, and sitting in a couple of bank accounts to which I have easy access. And for two, when I start investing for my own distant future, diversify and don't be overzealous. Slow and steady is the course I plan to take with my money.
Tags: insanity, money
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