Dow Drops 239 points ... Financials to blame..

So yesterday it was Merrill Lynch. They announced a $5.7 billion write down as a result of mortgage loans ... following $41 billion earlier. Several weeks ago it was Fannie & Freddie. Prior to that it was Bear Sterns... and so on.

Henry Paulson (US Treas. Scty.) said yesterday... "I'd rather not be in the position of asking for these extraordinary efforts..." So our Treas. Scty. has to seek "extraordinary efforts" ?!?! Shoes keep dropping, & monetary policy-makers keeps reacting to keep the train on the track.

I am growing more & more uncomfortable with the amount of intercession from our monetary policy-makers. Why do they have to intercede? Why do we need the "extraordinary efforts"? Maybe what we have here is a financial crisis ... in slow motion.

TALKING HEADS DON'T THINK LONG RUN!
I heard a "talking head" on CNN say yesterday say this: "In 1998 the world was producing oil at 85% capacity ... today we are at 98% capacity." She then asked her guest "What do you think that means?"
WHAT DO YOU THINK IT MEANS???? We are near peak capacity & global demand is continuing to increase (see Brazil, Russia, India, China) ... IT MEANS PRICES WILL CONTINUE TO RISE OVER THE LONG RUN !!!(DUH). Think 10 years out...what will oil cost? What impact will its price have on the economy. I think we should take this into account TODAY as we plan our financial future. ...........Stay tuned for more specifics.

Would you get on a plane ... without a flight-plan?
I am a financial planner, and aviation analogies come easily to me so when somebody asked me to give my first 30 second commercial I naturally related financial planning to flight planning. That was 8 years ago ... & I still use that idea to help people remember what I do.

It's an effective analogy because when you are in flight:

• You want to know for sure where you're headed.


• You want the pilot to know how to avoid rough weather without taking you off course.


• You want to arrive at your destination on time.


• You want to get there as quickly as possible.


• You want a smooth landing.


• And most importantly, you want the pilot to do it all as safely as possible.

To me, every one of these statements is also true of financial planning.
So, as the "Financial Flight Planner" I find myself advising that people to "Keep the seat belts fastened tightly around you." The next several years are likely to be a bumpy ride.