Finance

Disclaimer -- taking investment advice from me makes you an idiot and me not responsible for your actions.

There are a number of respected sources that are detecting a contraction in the market and an economic recession following it. Unemployment numbers could be as high as 12% and inflation based on non-substitution CPI could be as high as 8%. Some warning signs are starting to show up but I imagine that the market will be strong until January 2008. Then investors will get spooked and shift their money to 'safer investments'. Maybe they'll pay off their credit card debt.

After moving my own money around, I'm back to building up 6 months of living expenses. I have it, more or less. The trick is moving the "more or less" to just "I have it".

There are a bunch of companies that I like, despite the warnings above. I always look long term which tends to ignore initial price. My list:
X, BP, XOM, MCD, KO, LMT, LTD, FDM, INTC, AMD, VZ, WMT, MSFT, ORCL, SUNW, GE, ACN, BAES, AHO, SWY, BRK, C, BAC, F, TM, LLL, BUD, PFE, MRK, DIS, CMCSK, HD, TGT, CAT, AEP, FDX, UPS, CSX, R, UNP, MO, NVDA, HP, DELL, UARM, IBM.

This is an extensive list, and some of them have been researched and others are based on intuition or common sense. Some of them are overpriced for the short term (3-5 years).

In my understanding, and according to Nobel Prize winning strategies, an investor should diversify their holdings. However, Institutional Investors such as Warren Buffett have always been focused on acquiring a small number of companies that their research shows will outperform the market. For example, Coca Cola, Hershey's Chocolate, and Budweiser Beer will sell products in a good economy or a bad one.

Hence, research into company investment should be limited to approximately 7 companies that are run well, have multiple products, have existed for longer than 10 years, and
are going to increase in value at a greater rate than any other investment. Investments should be long term and only when the fundamentals that led to the purchasing decision have changed should you decide to divest yourself of ownership of that company.

more thoughts to come.