Ron Holland lives at Wolf Laurel Resort near the Preserve at Wolf Laurel in the NC mountains near Asheville & he is a real estate agent with Wolf's Crossing Realty. In addition, he writes articles and edits financial newsletters and economic reports designed to help Americans preserve their wealth and liberties. Click Here To E-mail Your Questions or Comments to Ron or request a listing of mountain lots at Wolf Laurel where prices begin at under $20,000 per lot.
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A strange but true story of how how in the summer of 2000, I knew "for sure" we had reached the stock market top in the longest bull market in American history.
I set before you today life and prosperity, death and destruction. For I command you today to love the Lord your God, to walk in his ways, and to keep his commands, decrees, and laws; then you will live and increase, and the Lord your God will bless you in the land you are entering to possess. But if your heart turns away and you are not obedient, and if you are drawn away to bow down to other Gods and worship them, I declare to you this day that you will certainly be destroyed...I have set before you life and death, blessings and curses. Now choose life, that you and your children might live, and that you might love the Lord your God, listen to his voice, and hold fast to him. --Deuteronomy 30:15 -19
When did I know the longest bull market in US history was finally over and the Greenspan Crash I had warned about in 1998 was here? It happened during 2000. A well dressed young man appeared in a tailored, pin stripped suite at my house one afternoon unannounced and without an appointment. As I watched him from my upstairs office window, I concluded he was too nicely dressed to be a Jehovah’s Witness and since he was by himself, he sure wasn’t LDS because Mormon Elders always travel in pairs. I’m not in the habit of answering the door as I assume anyone I want to see at my home either has an appointment or I personally know them. Now quite a few years ago I was subjected to a nuisance lawsuit by an ex-wife of 20 years ago whose boyfriend was a lawyer. Of course I won and it could have been worse, he could have been a contract killer, an Amway salesman or a pushy stockbroker but you get the picture so I almost never go to the door. But I was intrigued, as he appeared to be carrying a Bible in one hand and a newspaper in the other. My curiosity got the best of me, so I walked down stairs and opened the front door. There I was suddenly hit with a canned welcome speech saying he was out to get to know the good people in the area and this led into how he was a financial consultant for a well known investment firm with small offices all over the United States. Then came a condensed the stock market sales pitch which I managed with some difficulty to stop in mid sentence by rudely saying "All brokers are whores so why do you carry a Bible along with the newspaper?" He was shocked and stumbled for a minute but explained it wasn’t just a newspaper but "The Wall Street Journal" and he carried the Bible because as a former minister he now felt he should also now spread the message of Christian financial planning. Today he was visiting the neighbors to spread the good news of salvation and wealth accumulation. After all, his firm said that we had a good 7 years more in the current bull market, and on and on and on. This time I stopped him by managing to get another question in between the verbal barrage which seemed like a weird combination of a Pentecostal preacher’s sermon and a very poor rendition of a well paid, stock jockey cheerleader on CNBC. Now no offense meant to Pentecostal preachers as I was saved at age 18 in a Church of God revival meeting a long time ago. My question, "how long have you been in the investment business?" He quickly answered, the firm has been around for almost a 100 years or something like that. "No, how long have you personally been in the business?" A blank look came over him, for once he was speechless and looked kind of downtrodden when he answered, "I’ve been out of the training program about two weeks." At a late stage in speculation, a larger and larger group of people seeks to become rich without a real understanding of the processes involved. Not surprisingly, swindlers and catchpenny schemes flourish --Charles Kindleberger 1978, Manias, Panics and Crashes My wife and others will say that I can be quite harsh at times when provoked but I really felt sorry for this guy who had left the Ministry to promote something he knew absolutely nothing about. So I held my tongue and told him "I wasn’t interested but wished him well in his new profession." But did this finish the conversation? No, he tried again, "and what do you do Sir for a living? We have excellent 401(k) and IRA services and at projected current rates of return in a well diversified stock portfolio you could become a millionaire in some number of years", again I stopped him in mid sentence by blurting out, "I’ve been an investment consultant for about 30 years". This silenced him again but only for a couple of seconds. He rambled on, "With 7 more years in the bull market we expect the Dow Jones Industrial Average could easily reach 20,000 and the NASD 10,000, where do you think the market is going Sir?" As I closed the door almost on his Wall Street Journal he had managed to wedge in the open door, I shouted "I think the markets are going to Hell" and I slammed the door shut. I watched him through the window as he straightened his tie, sort of got his composure together and walked to the next house on the street. A little later, my wife Tami came home and I said, "well, we are definitely at the end of the bull market and so it was! This story really happened last summer, in the year prior to the 60% plus crash in the technology heavy NASD. Long before what I expect will be a 75% plus fall in the NASD and a 40% plus pullback in the NYSE. I fear because of all the horrendous speculation that has been in the past market mania, the pullback could become the greatest stock market crash of all times. I urge our readers to protect themselves and their personal investment portfolios. Money…has often been a cause of the delusion of the multitudes. Sober nations have all at once become desperate gamblers, and risked almost their existence upon the turn of a piece of paper…Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one. --Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds, Preface to the 1852 edition. I have often wondered what ever happened to the young man who left the Ministry in order to preach another kind of message. I fear he had exchanged the message and worship of Jesus Christ with love, forgiveness, obedience and faith for the folly of greed, monetary gain and the illusive goal of temporal financial security. It is my hope and prayer that this market crash to date has at least helped this one man wake up from his delusion to what is important, real and true in life. I can measure the motions of bodies, but cannot measure human folly. --Sir Isaac Newton, who lost a fortune in the South Sea Bubble of 1720 Investing and investment markets are a necessary and important part of building one's financial and personal security in the 21st Century. Proper diversification and allocation in a prudent conservative manner is the best way to achieve financial growth and safeguard wealth. The problem begins when investors as well as investment advisors allow greed, the "hot stock market tip of the moment" and the gambling fever of rampant speculation often exploited by the financial media and investment salespeople to takeover conservative investment advice and fund management. In the end, politicians will always be politicians, salesmen are always salesmen and most investments are just paper promises and guarantees. Only government can take perfectly good paper, cover it with perfectly good ink and make the combination worthless. --Milton Freedman I have worked in, written about and studied the investment business for over thirty years. While it is an imperfect, man made system, all too often controlled and manipulated by financial elites and their Wall Street firms, still it is the only real opportunity available to prudently invest wealth. This is what we have to work with and there is no way the average American investor can hope to change or impact what exists. In my humble opinion, the wise investor, concerned about US controls, manipulation and political risk should diversify a portion of their investment wealth outside the American dollar and US investment markets. I'll close with a quote from the much maligned Henry Ford, who was a genius at production and marketing. His adequacy and knowledge in other areas, I'll leave up to you to decide! - Ronald Holland It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. --Henry Ford |