Friday, February 9, 2018


 A merchant approaches you asking you to invest in his grocery store. He then tells you that four other people have invested $100,000 in his store. He tells you that you will get your money back whenever you want it by selling your share to some other sucker, and in the meantime, he will pay you a dividend every month. So, what do you do?

Well, if you are a modern investor, the kind that invest in the US Stock Market, you will dive in and give the man another $100,000. That is why we have a Stock Market that ballooned to 27,000. In the case of the modern market, the other investors in the grocery store would be computers doing the buying of stock in the store. That is the freak we have in the Stock Market.

The problem is that the corner market is not making nearly enough in profits and cash flow to pay back what has been promised. And, no one bothers to take a long look at the corner store's profit and loss sheet. Stock buyers in the US Stock Market are buying based on the expectation that the monster will keep on inhaling eternally, and they will one day sell at a big profit.

This has always been the way of the Stock Market. Silly fools, bursting with hubris and greed, are buying stock as fast as companies can issue it. Anyone who has been watching for a lifetime like mine can remember that, over and over, the Stock Market has farted, thus deflating seriously.

That is what is happening now. If the Stock Market goes back up to $27,000 I can promise you, based on the same exact pattern in 1929, that the Market will finally crash. It will bottom out way below what it is worth, and then it will gradually come back to represent what is really going on at the corner store in question. 

What will happen? Thousands of people will be financially destroyed, and a bunch of them will leap from the top floor of buildings around New York City. One of the biggest investors in 1929 "lost everything," and he jumped from the top floor and killed himself. When all his assets were zeroed out, they found he still had $10,000 to his name. That would compare to about $350,000 today. The poor fool could have fired the maid and butler, let three of his limos go back to the bank, and lived quite well on this cash until he could find a job doing some real work. Colombia University would have hired him to teach economics.

So, I have no feeling for any of the idiots who play the market. It is just like going to Las Vegas. There are people who win, I will grant you. But, the vast majority end up leaving their cash in Las Vegas and trundling back down I-15 to Burbank..... broke. We lived in Yermo, California where we could sit on our lawn and see the fools lined up in a traffic jam in the middle of the Mojave Desert on any week end..... heading home broke. 

Every gambler, whether in Las Vagas or Wall Street, will tell you, "I have a system that works..... I always pay all my expenses. I may not make much, but overall I come out ahead." If you believe that, please contact me at once. I have five acres of Florida beach front property I will sell you. It has a great view of the ocean, free boat launching rights, great fishing, located in a tax free zone, and is pleasantly isolated from new development. It is just 200 miles east of Miami Beach.

We at Balaam's Ass Speaks would like to give the much coveted Dead Skunk Award to all you who play the market along with your loser friends in Las Vegas.

You may, with red hot tears, and proffering the secret handshake of the Grand Pubaah of the Moose Lodge, beg me to give you the deep dark Himalayan secret to investing.

Here it is.

BUY DIRT, preferably in Texas.