Citi and foreclosures
I am sitting here in a rare moment (after the arrival of our daughter) listening to CNBC.
2 things that caught my attention were Citi’s stocks dipped below USD1 and that a record one in eight households ended 2008 behind on their mortgage payments or are in the foreclosure process.
Wow, can you imagine those investors who have bought Citi’s stocks in the end of December 2006 and are still holding it now? Make me think about the overly used phrase “Buy and hold long term”. If a blue chip and Dow component share can fall so drastically from high USD50s to below a dollar, imagine what this can do to your long term portfolio? I think the current phrase should be “Don’t buy and hold cash”. Things are too scary at the moment.
The other piece of news is equally troubling. 1 in 8 households being behind in their payments affects the economy as a whole and it goes in circles. Unemployment which is at 16 1/2years high is contributing to the foreclosures and the foreclosures contribute to lower tax revenues and this will also contribute to less consumer spending. All this will go in cirlces and further contribute to the downward economy situation.
I am thinking that all these things are not seeing the bottom yet. And tiny investors like me are feeling nervous and jittery about what tomorrow will do to my portfolio.
What are your thoughts on these 2 pieces of news? Scary isn’t it?
