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Strategies & Market Trends : Ask DrBob -- Ignore unavailable to you. Want to Upgrade?

To: FLACK who wrote (44237)	9/20/2001 5:08:23 PM
From: Dr. B. ®	Read Replies (1) \| Respond to of 100058

"Why is this simple concept so difficult for people to understand?" Flack. I have no answer but can offer the mind set firmly sizzled in my father's brain and possibly others. I need to set the stage. My dad grew up extremely poor. We were poor. His dad he thought he knew but didn't. My grandmother lied to him about who his real dad was, only later (a few years ago) did he find his real dad at a grave site. My last name is not my blood name. My dad never made it to the 8th grade. He married my mom and went into the Navy at age 18 (I guess you could get in without a diploma then). After serving, he immediately moved to Ohio where there used to be numerous manufacturing jobs. With little skills and no education he had to settle on a job resembling a sweatshop. He quickly moved up the ranks by busting his ass and working long hours. He was even offered a partnership type agreement with the company, which he accepted. Things were OK until my sister was born with a hole in her heart (can't remember the medical term). The insurance only covered a portion of the, what was then (1972ish), extremely and risky corrective procedure. Bottom line. He had to sell his portion (which wasn't much at the time) of the company to pay bills. Only in the past decade has the company offered any type of retirement option. My dad although not too keen on finances, gobbled up the chance. At this point, however, he was not making much money and could only put a small portion into retirement. It was something. Also, keep in mind, that my dad works at a relatively small company (100 employees) and really doesn't make that much money. Recently, the two owners of his company sold out to another for a huge sum, leaving my dad in a horrible spot. Too young to retire, too old to find another job. His only leverage is the relentless respect from his workers (he is plant manager). They would all quit if the new company gassed him. NOW, the point is that my dad is not a risk taker because of the hardships and mentality that developed from past events and perceived environment. In his mind, switching money around is risky although we know he is really at high risk. He has no clue of what he is invested in and no clue of economics. He thinks 20k in the bank is a smart choice. I do not fault him for his mind-set but have tried numerous times to convince him on diversifying and moving monies around for protection. He would rather talk about fishing or hunting. I love my dear dad to the core of my heart for he is truly a honest, hardworking, sincere, caring, and very well respected man. I will die working myself just to help him.

To: FLACK who wrote (44237)	9/21/2001 10:47:04 AM
From: jpdunwell	Read Replies (1) \| Respond to of 100058

Hi Flack, <<To which I replied, "Right, but that was THEN, and this is NOW!" Why is this simple concept so difficult for people to understand? >> Because people are generally optimists when it comes to the stock market, often to the exclusion of reason. Everyone wants to believe in the happy ending, and we eventually get there, but no one wants to acknowledge that there can be lots of ugliness from here 'til then. Still too many people afraid of missing out, and the brainwashing job done by all the so-called experts has been thorough, to the point that they make it seem sinful to be out of the market. The fear of missing out is taking a long time to change into the fear of losing a large percentage, but the process is well underway now. My wife says "gee, you're cheery", but I'm just trying to call it like I see it. Turning a blind eye will not help our portfolio. The markets around the world are telling us that this is going to be one ugly period. This will end sometime, but I don't know when, and I see a lot more ugliness to come before we get to that point. Hope I will recognize it when we're close. For the average investor, he should be most concerned about preservation of capital, and not return. As I write this, I notice the bottom-catchers pushing the indices well off their lows. Tells me that the process of changing attitudes still has a long way to go. JP