The news has been crazy the last couple of days. I figured I’d just round up a couple of pieces of it for those out of the loop.
Unless you’ve been under a financial rock the last couple of days you’ve heard of Bernie Madoff. I’ll be honest, a lot of the specific details about what he did are over my head. For the most part, I don’t really care to learn the specifics… I simply boiled the whole thing down to big Ponzi scheme, pain, people out of billions of dollars, pain, probably the worst timing imaginable in this economy, pain. Kimberly Palmer of Alpha Consumer reminds us that we can learn one big lesson here: diversify.
Fed Rate Cut
With the cutting the federal funds rate 3/4 of a percent, we can expect high-yield banks such as FNBO Direct to reduce the interest rates they’ll give you. CDs will probably drop as well. It seems like the Fed is willing to unleash it’s whole arsenal of ammuntion on this economy. However it seems like the economy is like Superman watching the bullets bounce off his chest. The Fed may be running out of bullets too.
This hasn’t been in the news of late (at least that I’ve heard), but remember a few years back when there was a big call to let the government invest Social Security funds in US stocks. The greater return of stocks was supposed to be the answer to keeping the program alive. Let’s give a little a credit to the people who shot down that idea. They say that things could always be worse, and there’s your proof.