Markets Recovering?

I have wavered back and forth on the outlook of the market, but I think this week's Bear Stearns announcement, coupled with the Fed rate cut and the huge positive reaction from the market suggest that the markets may be slowly getting back on its feet.

Let's break down the three situations:

1) Bear Stearns' stock, even with a clear buyout deal, orchestrated by the Fed, from JP Morgan has continued to climb from the buyout price of $2 / share to almost $6 / share today. This indicates to me that market participants are realizing the buy out is way too cheap, suggesting that people do have a bottom to their recession / subprime fears, and $2 is certainly way below it.

2) The Fed discount rate was widely believed to be 100bps, and by taking a surprising move of 75bps, showed the market two things. (1) The Fed has a backbone and is capable of making monetary policy without bowing to Wall Street and (2) The Fed believes we are in a better situation and therefore believes the additional 25bps is unnecessary.

3) Looking at the 3-4% increase in all major indexes, one has to ponder that the Fed minutes were all good news, and that market sentiment is veering to bullish.

What does this all mean in the end? I think we have another 2 months of the market's volatility smoothing out, and by early summer, it will be the right time to buy in again.

Back from vacation

As I sit in the airport, reflecting on the last seven days of revelry, exploration, and easy-living, I can really only think of one overwhelming theme for myself, and this blog.

On the last two days prior to my cruise, I had been responding to sharp, but spot-on, criticism of my spending habits. At the time, I was defensive, incapable of providing a satisfying answer. But now, it is clear.

Any reader of this blog knows WHAT my goal is, but how about WHY?

It comes down to being able to live life.

Every day I write and think about saving money. However, the purpose is not about counting the zeroes on the bank statement. The purpose is to be worry-free about spending the money. Not to the point of extravagent opulence, but rather, the ability, for instance, to moped, parasail or jet ski at will and have others there enjoying it with you.

To bring it full circle, occasional indulgences are not only non-counter to my goal, but rather a necessary component.

I'm happy to say my numerical goal has suffered from taking this vacation, but I have stayed true to the purpose of the goal.

And, as something to ponder, is the state of happiness something that exists as your personal asset? If so, I'm far closer to the numerical value, regardless of the illiquidity such an asset.

On Vacation

I start vacation Friday afternoon, but this is going to my last post until the next Sunday when I arrive home from my Caribbean cruise.

In the mean time, thank all of you for reading my blog, and remember to check in again in a week!

Saving eletricity while single...

...is tough to get into the habit of doing, but the savings add up quickly.

Recently, I had blogged about not running the humidifier running while I wasn't home. That saved about $20 in electricity. Then I thought about the appliances that I have on that don't need to be on. I really only had two other items, my router and cable modem. I've been turning those off and seeing what that does. If I see another $20 decrease in my bill, it would be worthwhile.

I have also switched out most of light bulbs to energy saving light bulbs. I will be getting my electricity bill soon, so I will soon be able to quantify the value.

Networth Update - 2.22% pts closer to my goal this year

If last month was the lowest point in my blogging career, then this month's networth update should have been precluded with some sort of financial training montage. February saw a dramatic turnaround for my networth, led by bonus season, more strict adherence to my own budgets, and a significant decrease in my utility bills (which I will blog about separately).

Compared to last month, my networth is up 0.29% or $2,904.20 (all networth percentages are based off of my goal of $1 million).

On the horizon, are a few networth neutral, but debt ratio clearing items: paying off a large chunk of credit card debt and paying back a parental loan.

Also, I will be filing taxes soon, and if I eFile, I could have my tax return back this month as well.

There is only one cause for concern. I am off on a week-long cruise in the Caribbean in the second week of March, and I hope I can stick to my usual food and discretionary budget, but that is doubtful.

Anyway, overall, this brings my networth to -$7,285.93 or -0.73% away from my goal. But compare that to a year ago when I started with a networth of -$29,509.52. That is a 2.22% increase to my goal compared to last year! Only 6 more years to go.

Here's a nifty graph that tracks my monthly networth: