MOVIE REVIEW: “The Big Short”

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If you haven’t seen this movie. Check it out. It stars some big hitters like Christian Bale, Brad Pitt, Steve Carell and a host of other familiar faces. I found it on Netflix and was reminded of this gem by a student in my recent investing class.

For a movie about investing and the housing bubble they actually made it very edge-of-your-seats exciting.

WHAT I LEARNED FROM “THE BIG SHORT”

1. The Value of Short Sellers

The whole basis of the movie is the strategy of short selling. Ultimately, this is profiting from an investment that goes down. What this strategy leads to is a sort of investigative journalism in the investing markets. These short sellers are trying to find the dirty truth of what’s going on with particular companies, industries or entire economies.

When things are being covered up and colluded upon, short sellers will dig for the facts. Like the journalists of old.

2. Don’t Trust Wall Street

They’re always looking out for their fees and commissions. You need to get an expert that profits when you profit and loses when you lose.

3. We’ll Make It Through the Bad Times

Despite massive losses or faults in the system, we will make it to the next stage of growth. The Great Recession was a bleak time. The pessimism was profound. You could feel it in the air.

And then…we made it out the other side.

4. You Need to Diversify

I sound like a broken record on this one. I say it everywhere and to anyone: get into unique asset categories. Not ten mutual funds that sound different. Ten funds that are different. Do your homework. Study up on what your money is in.

5. Most Importantly, Don’t Think You Can Short

You might be able to. You might do it a few times and make some money. But always remember the potential of a short gone bad: you can have unlimited losses.

Just be a “long” investor. If you believe the U.S. and world economy is going to go up, then buy solid, global investments and hang on. If you can get significant income from the investments then that’s even better for you.

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There’s a lot more to learn from this movie. And there’re some fun cameos, too. Take a look.

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A Little Bit of Shock Value…

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I just published an article titled “Welcome to 2026.” It showcased my new-found optimism about the future of our economy and our markets. And, admittedly, I was going for a little bit of shock value when, near the end of the article, I declared the Dow Jones could hit 44,000 in ten years. The DJIA is currently around 18,500.

Here’s a link to the article in the local seniors’ paper, The Senior Beacon (article on page 24).

A FEW WARNINGS

After reading some scary articles about the very near-term, I wanted to repeat my warnings. We will absolutely have recessions, bear markets, catastrophes and other bad and volatile events. BUT…those things have never stopped the market in a super-bull cycle.

LOTS OF BAD THINGS

The world’s a total mess: there’s record-high government debt, record-low U.S. interest rates (indicating a weak economy), wars, invasions, bombings, negative global interest rates, worldwide growth slowdowns, Brexit–whoa, gotta wipe the sweat from my brow. Are you optimistic yet?

I’m aware of these major issues. They are important. But they’re not devastating.

WHAT WE’VE TRIUMPHED THROUGH

For example, the U.S. has survived most of those things before, including bigger trials like assassinations, Great Depressions, multiple World Wars, etc. You get the idea. All through this, the markets have reached new highs, generating new wealth.

I believe we’re on the cusp of another super-bull market. We had the latest in the ’80’s and ’90’s. Then we had the worst decade in the stock market. Ever. The worst ever. Even worse than the decade that includes the Depression.

That was the major down cycle. Now I think it’s time for the markets to move even higher up. Get ready for Dow 44,000…

Here’s a link to the article again. Check it out on page twenty-four.

If you’d like a free report that took 17 years to build, highlighting the ten most-repeated mistakes I’ve seen dozens of investors make, just email the word “ten” in the subject line to RonPhillipsAdvisor@gmail.com

This report can help you minimize risk, save you $1,000’s in unnecessary fees, protect you and your loved ones from financial devastation, and minimize or even eliminate your taxes on investments. Pull up your email program, put “ten” in the subject line, send to RonPhillipsAdvisor@gmail.com and sit back and wait for the most important free report you’ll ever read on your investments.