Unnerved by the market?

If you are an investor and are “significantly” invested in the stock market, these days are hard to take and require a strong resilience and an uncanny ability to ignore the advice that comes from all places.

Some of these pieces of advice are right, other are wrong, but there’s no way to know which one to follow now, as no one is able to correctly predict the future.

Well, let’s console ourselves by looking at the opportunity the situation brings to strengthening one’s character!

How to “buy” a US green card

While I had heard that permanent residency was possible in Canada to someone investing in real estate, I was, until now, totally ignorant that a foreigner could do the same in the United States. Starting with a $500,000 investment it's been possible since 1990 to apply for a fast-track green card, provided the real estate, or mixed used project can create at least 10 jobs.

Instead of waiting many years to get a green card doing it the hard way, one can be had in just two years. If this is not called “corruption” and don't know what is. Apparently, there's a 10,000 slot allotment per year for these special EB-5 visas that lead to that particular green card and there are rumors that the $500,000 threshold might go higher given the understandable high demand, mostly from Chinese.

While this “special sale” may sound repulsive to many, some just say that 10,000 green cards are just a “drop in the bucket” compared to 1 million such cards issued each year. So if a US “green card” is in the cards for you, don't delay, open up your wallet and you'll be on your way!

Behind stock market volatility

By now, you've heard it all. Emerging markets and Europe down on their luck, overproduction of oil, Ukraine, Ebola and even Hong Kong. All these events seem to be the reason behind jittering markets, in spite of mostly good economic indicators in North America.

No one seems to recognize the malevolent influence of automatic trading that sets threshold for automatic sale orders, also known as “stop-loss”. When the stock market is going down, it will encounter these guard-posts and trigger massive sales spinning a vicious circle or rather a damning fall to hell.

Pretty simple, not recognized and yet hard to dispute. Suffice to say that the more automated stock markets become, the more volatile they'll be. Fasten your seat belts, sit back and relax!

Back in the market?

The US stock market has been doing phenomenally well lately. I measure my words “phenomenally...” By all measures, today's market is overvalued. By how much? Some 3%. Will its evaluation fall (I've not said “will the market fall”)? Probably. Will it go back up? Definitely. Then what's an investor to do?

Look at historical data; in case of doubt stay in the market, if not invested, buy on “dips”, keeping in mind that the biggest dips were 55% in 2009 (yes, the market was 45% below true valuation then - what a fantastic opportunity to buy!)

If you want to sell, watch for the market to get overvalued to 105% or 106% (it went up to 114% during some “bubbles”) and then patiently wait for it to get to minus something and then purchase! This said, buying on an elusive dip is always very challenging!

Mr. Dimon's gift to Obama

I can't help but think that the CEO of JP Morgan Chase was intent on giving a positive nudge to Barack Obama in creatively causing probably more than a $2 billion loss in the credit derivatives index on which JP Morgan is believed to have amassed a huge position.

This time, and after all Dimon's apologies, it will be really hard for folks like Romney, to claim that banks ought to be further deregulated and the the Volker provision in the Dodd-Frank financial law shouldn't be implemented at all...

UBS like Swissair?

I was shocked when Swissair went out of business several years ago. I thought the company was something that would last as long as the human civilization. I also regarded the Swiss bank UBS in the same way, and that until some time in 2008 when it became clear that the right hand didn't know what the left hand was doing in dealing with American securitized mortgages. Today, it's a so-called “rogue trader” and a $2 million loss that's making the news. Give me a break, I wouldn't trust a bank like that more than I once trusted a fine, Swiss airline...

Congress on vacation?

If you followed the day on Wall Street, you may wonder why President Obama hasn't recalled both Chambers and demanded that they come to Washington and finally begin working to get our country's financial situation squared away. What is he waiting for and why is Congress enjoying a totally undeserved vacation after the three-ring circus number they've treated us with?

I don't see any sense of urgency anywhere and can't understand why this is not the case. Leadership demands courage and those who are in such position and lack that essential ingredient don't deserve to lead. They should follow, or better yet, as Lee Iacocca once said “...get out of the way!”

The Republicans' fault

The colossal market nosedive and recent downgrade of the Natioin by S&P should be squarely placed on the shoulders of the Republican Party and their extremist Tea Party fellows. Pure and simple. The Democrats are bad, but not as wicked as the Republicans.

If I had to put the blame on the recent political three-ring circus and subsequent financial fiasco, I'd say: Tea Party 50%, Other Republicans 35%, All Dems 10% and Barack Obama 5%. This retribution scale is something the Nation needs to remember come next November 2012. We should ship the entire Republican Caucus of the House of Representative on a one-way ticket to Afghanistan and have them chase the Taliban. It certainly will be the other way around!

Wall Street blues

It's hard to watch the stock market crash and yet to remain stoic, especially if you have something invested. It's a lot easy to ride the top of the waves and think we are heros for having made smart and timely investments and pad ourselves on the back as we bathe in glory. The bottom of the barrel is not a fun place to be; not just as far as Wall Street is concerned, but all other life circumstances.

We accept elation but can't deal with humiliation and that's just human nature, I guess. It's hard to remember the precepts of Mr. Warren Buffett: “Be fearful when others are greedy, and be greedy when others are fearful.” My maxim is somewhat similar but applies to almost any situation: “When we're a the top, the next move is down and when we hit rock bottom, the next ride is up!”

When the lesson begins to sink in...

My favorite quote from Warren Buffet (and there are tons of them attributed to the legendary investor) goes like this: “Be fearful when others are greedy and greedy only when others are fearful,” and for the first time in years, it's beginning to sink inside my hard little head. Today, when I see the stock market reaching exuberant heights, I feel good – that is, as long as I'm in it – but there's a little voice inside me reminding me that "what goes up must go down..."

Right, this same Taoist philosophy about the cyclical nature of life. Conversely, when everything around us reminds us that “the end is near” I begin to relax. Does that new understanding mean that I'm on the cusp of becoming a wise and successful investor? Not so fast! I'm simply reaching stage one of the process, just becoming fearful when others are greedy. I still have to work on the other side of the equation...