Jewish World Review Jan. 4, 2000 / 9 Teves, 5761
I know this is the time of year you start looking at your finances. This is the time of year you figure out how much you made so you can figure out if you can afford that vacation in Aruba or if you can buy, for example, a bag of groceries.
Got a rough idea of what you made this year? No? Well, let me tell you. Nothing. And that's the good news.
The bad news is that most people made less than nothing. They lost money.
How? I'll tell you how: They invested money in the stock market.
They followed the advice they got on the Internet or at the water cooler, or what they saw on TV.
And remember the good old days when you could watch CNBC or MSNBC all day, and see that stock ticker rise and feel good?
When were those days? I can't even remember.
That's because there has been, well, a little downturn this year.
We don't like to call it a recession because we don't like that word, so let's call it a little chasm on the road to prosperity.
How deep was that chasm?
Well, let's look: As I write this, the Dow Jones Industrial Average (which is the average of the value of the letters in the word Dow and the value of the letters in the word Jones and the value of the letters in the word Industrial, based on the popular word game Scrabble) is down 7.5 percent for the year.
If it stays that way, this will be its worst year since 1981.
The NASDAQ, which is made up of all those stocks you once wished you owned but your no good slug of a brother-in-law heard about first, is down 38.2 percent for the year, which would be its worst year ever.
And the S&P 500, which used to be called the Indianapolis 500 but was changed because too many brokers were getting run over, is down 11.1 percent, its worst year since 1977.
If you add up all the losses of those three markets, divide it by the number of investors, and multiply it by current projections for a recovery, you reach the conclusion I was telling you about a few paragraphs ago: You are now poor.
I know what you are thinking: How do I pay for my kid's college?
Stop thinking that. Start thinking: How do I pay the heating bills this month?
I don't wish to make the situation seem to bleak. Fortunately, we have just elected a president who has an advanced degree in economics, a deep understanding of the world economy and boundless energy to tackle problems.
Oh, wait. No, we didn't. That was some other country. We elected a guy who used to own a baseball team and likes to take naps.
No matter, because there still may be time to follow the theory that I advanced to you in 1999 but you didn't pay any attention to.
Here is that theory: Buy Stuff Now.
That's it. It's just that simple. Go out and buy stuff with whatever money you have left.
Here is how it works: Let's say earlier in the year, you had $20,000 sitting around in some stock or mutual fund.
What has happened to it? Let's say you were lucky; let's say you only lost a third of it. OK, now look at my Buy Stuff Now Theory.
Under my theory, you took that $20,000 and you went out and bought a car with it. That's what I did.
Any every morning when I wake up and I hear some guy on the radio talking about how this or that stock is down 20 percent, I throw off the covers and rush to my window and look out at my car.
And you know what? The whole car is still there. That's right: 20 percent of it has not disappeared. (Unless you count the time the rotten kids down the block stole the tires, but that's another story.)
So that's the choice you have: Stick your money in the stock market and watch a percentage of it disappear.
Or Buy Stuff Now and you get whatever you bought, with no part of it disappearing.
And when you get into the office and everybody is watching MSNBC with gloomy faces, you can say, "My new Honda is purring like a kitten!" or you can say, "My kid is too stupid to get into college, anyway!"
And then you can laugh.
Stockbrokers have been trying to poke holes in my theory ever since I advanced it.
They used to write me angry letter after angry letter.
But these letters have stopped, and I think I know why: One, my theory is flawless.
Two, stockbrokers can no longer afford