Thoughts on 2008’s Economy and Stock Market

The dreadful year of 2008 is finally over and though there is no guarantee that we’re even close to the bottom, I can’t help but feel like we’ve gotten past the darkest part of the day and the sun is finally rising. If only for psychological reasons, our nation has finally woken up and the era of quick money, no-value, gluttony is gone… at least for another ten to fifteen years until the cycle begins again. Here are some of my reflections for 2008:

• The inevitable happened, and those wise enough or smart enough to quit while they were ahead made good money in this multi-year economic rising. For the average Joe who let the supposed “experts” handle their money, they lost close to half of everything if not more. This is why I quietly get filled with rage whenever I see mutual fund commercials.
• It is pretty amazing when you sit back and think about all of the corruption that has been going on in the past years that led to this economic crisis. Numerous people are coming out now and speaking about how horribly corrupt things had gotten, yet there was nothing that could be done to stop it. If you had a conscience and wanted out (regardless of what industry you worked in that contributed to this disaster), you were quickly and easily replaced by someone else. If you tried to warn people, as many economic advisers did, you were simply ignored by the public and the media because everyone was too happy making money in the short term.
• I’m quite conflicted as to my own performance for 2008. While I was mostly cash for the entire year (and thus could not gain or lose much), percentage wise my portfolio ended 2008 down roughly 18%. That should be awful news, but in comparison to the S&P 500’s own performance, I could be doing considerably worse.
• In the end, we reap what we sow. Greed and corruption were rampant, and now we’re in a deep recession. However there’s always a positive way to spin something, and I expect this recession to boost our country’s economic and financial conscience for at least another 20 years. Too long has apathy been a characteristic of our nation, and hopefully now people will begin to care.

Happy New Year everyone, and may 2009 bring us a much brighter tomorrow.