The Hustle of Sistah Ant

I funded an order for a stock today that I’ve been looking at that I think is a good buy for the long run.  I’ve had my eye on it for months, and I haven’t gotten around to buying it until today.  When the market tanked yesterday, I put in my order.   I believe that the market will rebound and stabilize, eventually.  And I figure that the particular stocks I bought in my Sharebuilder account won’t crap out before that happens.  It’s only $300.  If I’m wrong, I’ll be able to live with the consequences.

I’m not moving my stock-heavy IRA into bonds.  I’d lock in my losses that way.  It would be different if I were 30 or 40 years older and had less of a time horizon to recover, but I’m just getting started.  I believe that the market will rebound and stabilize, eventually.  And I figure that the particular fund I own in my IRA won’t crap out before that happens.  It’s only $2,500.  If I’m wrong, I’ll be able to live with the consequences.

My entire house savings and emergency fund are both in the bank.  I checked on the health of my bank at this website and am considering my options for whether or not I want to move it to a stronger bank. This would forfeit future interest earnings on the money but the money could possibly be safer somewhere else.  I am not pulling all of my money out of the banking system entirely.  It is FDIC insured.  It appears that the FDIC hasn’t been wiped out yet, after huge banks have failed, so if my bank fails, I think my deposits will be secure.  Besides, if I pulled it out, where in the world would I put it?  A fire or theft would destroy all that I’ve worked for.  All of that said, however, this is subject to change.  I’m just not nervous enough to panic.

There are a few things that do make me nervous, though.  First, I am still in the job market and when my contract ends, I will have no health insurance.  An emergency could deplete my house savings or put me in debt, making me less eligible to borrow for a house.  Also, if my credit card issuers decide to lower my limits because they feel they’re exposed to too much risk, and I wind up carrying a credit card balance for any reason, this will lower my credit score because the ratio of my balance to available credit will go up.  This will also drive up my monthly obligations in proportion to my monthly income, which is another thing that lenders look at when evaluating your creditworthiness for a mortgage.  If I get a house with a lower income than I’m getting with this contract job, it’ll probably make me able to borrow less.  The possibility that I’ll have a New Years’ Eve housewarming at my own place is threatened by the job market already, and now this is further threatened by this credit crunch in the marketplace than it was before, since investor confidence is shaken.  What a bummer.

Mister Ant is in favor of the bailout, since he figures propping up investor confidence is the name of the game. He thinks that not passing a bailout, in order to avoid rewarding fat cats and big companies, would be cutting off our noses to spite our faces.  I see his point, but I still have my reservations about whether or not we want our country to buy bad debts and simply hope that they improve, with no guarantee that these debts would have value again.  No one else wants these bad debts - there is no market for them - but we want our country to spend an obscene amount of money to buy them so investors will feel better?  That scares me.  How would it affect other aspects of America’s budget health?  What effect, if any, would this have on inflation and my ability to save for a house and retirement with a devalued dollar?  Why is it that the president can articulate why we need the bailout in speeches, but he can’t answer these questions in his speeches?  I need more answers.  I am not sold on this, even though I see from yesterday’s 700+ Dow drop that continued inaction really is threatening.