You Never Give Me Your Money

Now what did I tell you. Back in January I told you the stock market would be headed lower and we're down about 3 or 4 hundred points since then. Last year I told you that housing was underpriced and prices here in the Bay Area have risen around 15%. You can check the archives if you don't believe me, and it just goes to show how easy this investment advice business really is.

So, given the 100% accuracy rating of my last forecast I know you're eager to hear my predictions for the next 6 months. Well, glad you asked, and if you send me $500.00 I'll mail to you the very next issue of my investment newsletter "The Tony Report". In it you'll find all the strategies and information you need to prosper in the months ahead using my patented "flip-a-coin" process - insights you won't find anywhere else on Wall Street. This is a no obligation offer. If you are not completely satisfied I'll gladly refund your money and the first issue is yours to keep. That's timely information, valuable insights, and a free money-back guarantee, all for less than $1.40 per day. But wait, there's more! Act now and I'll also include a copy of "10 Secret Tips that only Wall Street Millionaires and Investment Gurus Know". Crucial knowledge you'll need if you want to make money in todays up and down markets. This is a limited time offer so don't delay. Send in your money today.

No, no, no...just kidding. Don't send any money. I'll tell you where the markets are heading.

First the stock market. Everyday I hear experts saying that the stock market is oversold and full of good invesment oppurtunities so I'm pretty sure we're going to keep drifting lower. Nothing dramatic, but when you hear this many people telling you stocks are going up, then you just know they're gonna go down. So what do you do? Well, don't be like this guy I saw on the news last month. They were doing one of those man-in-the-streets interviews and they asked this guy if he was investing in the stock market.

"No", he said, " the stock market's been down lately. I'm gonna wait till it starts picking up again and then maybe I'll buy some stocks."

In other words, stocks are cheap right now so I think I'll wait till they get more expensive before I start buying. Uh dude, that's not the way to make money in the stock market.

Anyways, my advice to all of you out there (which I'm sure is worth every penny you paid for it) is to be looking for buying oppurtunities when the market is down and then think about selling them when the market is up. You know there are people who pay good money for advice like that. And I should also add, in keeping with the new disclosure laws, that I own mutual funds and not individual stocks and I dollar cost average each month. So that being the case, I say pffffttttt - who cares if this is the right time to buy or not.

As for the real estate market, well I think we should all stop and give a moment of thanks to Mr. Greenspan of the Federal Reserve. As you may have read he has been raising the federal funds rate over the past year, and with each gradual increase the bond market has rallied and housing prices have soared. Of course it's not supposed to work that way, but that's what's happening. Matter of fact I think the treasuries rallied again today and the yield on the 10 year note is all the way down to 4.17%, or thereabouts. A few more rate increases by the Fed and we just might see the yield on the 10 year note go negative. Now wouldn't that be a kick.

Of course the psychology in the housing market these days is to get in before the rates start going up, so every new increase by the Fed seems to spark these little mini-rallies of panicked buyers rushing to buy while the getting in good. It's like feeding the housing market little shots of adrenaline that send prices up another 5 or 10 per cent with every increase in the interest rate. Some are calling that a bubble, saying the whole market is overstimulated right now, but I say housing is still underpriced, at least in the Bay Area where there is an enormous demand and a very tight supply. As long as the Fed keeps feeding us our adrenaline and the psychology stays in place, the market should continue to rise for quite some time.

So there you go. I could of charged you $500.00 for these pearls of wisdom but I didn't. I hope you appreciate that. Just remember, stocks down, bonds up, housing up and up and up. And if I'm wrong, then...well, that's your problem. Serves you right for getting your investment advice from some blog.

Turning now to the California news. It's official folks, the revolution is over. Seems kind of sudden too. I mean the governor has barely even fledged and already he's a lame duck. I've already covered all of this before and it's really his own fault, so I'm not going to belabor the point anymore. What is interesting is the State recently looked over it's revenue projections for the year and things are looking pretty good. In fact a stronger than expected economy means we just might have a little more money coming in than we thought. Woohoo!!! Now we can start to pay down some of that deficit that we've built up over the past couple of years. Right?

Well, not so fast there, because no sooner did we find the money than the capitol was besieged by public minded citizens anxious to get their hands on some of it, and, of course, plenty of civic minded (and vote hungry) democrats more than happy to dish it out. Oh ok, maybe I'm being a little premature here. Nothing's actually been decided but I get the feeling we're going to get something resembling the Max Bialystock plan out of all this.

You remember Max don't you? From the Producers? I figure we'll just do like Max and dole out the surplus without too much attention being paid to the math. Teachers Union, you want some of the surplus? Well, here's 80% for you. Police and Firefighters? How about another 80% for you too. Health care workers? Prison Guards? Transportation workers? 80% for each of you, and thank you for doing such a good job. And please, remember who your friends are when the next election comes around.

"But Mr. Democrat, sir, you can't give everyone 80%. You don't have enough money to cover all that. How will you balance the budget?"

"Budget? We don't need a budget. We've got credit cards now. A few billion more in deficit reduction bonds ain't going to make any difference."

You just watch. I bet that's what happens. Come next year when it's time to pass last years budget (we Californians aren't known for our punctuality) we'll be facing another hole and the dems will be pointing fingers and blaming everyone but themselves for the mess. It happens every year.

Turning now to the local news...BART is coming to San Jose! Yeah! (We think)

In case you're not from around here I should explain that BART refers to the Bay Area Rapid Transit System. Basically, it's a train system connecting San Francisco with the East Bay Area counties, and while it does a good job of going East and North it's never connected San Francisco with the big dog around here. That would be us of course. San Jose, the Bay Areas largest city.

Now it looks like that's all going to change. At least we thought it was going to change when we came up with this plan. That was back in the Dot Com days when the South Bay was rich and had revenues coming out our ears, but, unfortunately, things have gotten decidedly bleaker since then. Still, we thought we could make it work with some federal funding and the feds were all for it until they did this study.

Oh yeah, the study. You see, the plan is to connect San Jose to the existing line that runs from Fremont (northeast of San Jose) to Oakland creating a San Jose to Oakland line that would run up along the eastern side of San Francisco Bay. Like I said everything was looking good until someone did this study and found out something interesting. Turns out no one in San Jose really wants to go to Oakland. In fact, the predicted ridership was so low that the feds asked us why they should give us a billion dollars to run a bunch of empty trains back and forth to places no one wanted to go.

Not so, not so, we said, plenty of people want to go to Oakland, but the feds were pretty adamant about it and shoved us way down on their list of priorities. And that's where we stand. Poor San Jose, we want to be all grown up just like our big brother to the north, but everyone keeps telling us to wait till we get older. It's so humiliating.

So no BART for now, and probably not in my lifetime either. I mean even it does get funded it'll still take a hundred years or so to work through all the delays and lawsuits and studies and cost overruns that inevitably crop up when taking on a project of this size. But it'll be cool if they ever do get it built. And Oakland's not such a bad place. They've got parks and museums and restaraunts and all of that stuff, and it's a perfectly safe place to take a stroll and do a little shopping...

As long as you're heavily armed.