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• Friday, August 17, 2007 11:56 AM

  I am an idiot

  I completely missed the run up in tech stocks when everybody was getting rich. Instead I bought a little silver because nobody wanted any and it was cheap. I have stayed out of the stock market and missed all those fabulous gains - really have felt stupid as a result. I just put every penny I could get into T-Bills and cringed as the dollar lost 40% of it's value in the Bush administration.

  You see, the thing is, I know I am an idiot. I don't understand why a CEO is worth $100 million a year, I don't trust the referees to keep the game honest, and I don't figure I'm smart (or well informed enough) to catch all the "gotchas" in annual reports and prospectuses. The pundits on financial programs on tv mostly seem like super-slick used car salesmen to me and I instinctively grab my wallet when I see em.

  My jaw dropped when I heard Greenspan say in congressional hearings that housing lenders should engage in "creative financing" as he was pouring money into the markets - lowering interest rates to historic levels. I watched all those smart homebuyers rack up gains and stupid old me, I just found a cheap apartment for somewhere between 1/3 and 1/5 the monthly payment I'd have had to make on a modest house or one of the cardboard-constructed condos that have been going up around here. (One of those condos would have been more like 8 - 10 times my rent with taxes, insurance etc.) I live neartown now and an affordable house would be out in the boonies, increasing commuting time and expense.

  I marveled at how these folks with the same modest (median) income as my wife and myself could manage the new house, furniture - and the new car they were all driving. That was before I heard about 100%, interest only (or even 100%+, no payments at all for a time and so forth).

  I guess my wife and I are total fools. We don't understand the market, so we're not in it. We don't understand how to manage debt, so we don't have any. Our car is 11 years old and we don't have a big screen. I have always thought that return of capital was more than return on capital, so we miss every big score.

  Still, we had essentially 0 assets 10 years ago and I just heard that the median home price in my area is around 150k. We could pay cash.

  Boy are we stupid!

  —Anonymous
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