But what is hedging all about in the first place?

Conspiracy theorists have their hands in the air. What’s that? Portfolio hedging strategies were created to expand the market for the first generation of derivative products— options and futures contracts. Hmmm, not so far fetched an idea, really. Just back up a bit and think about what they are trying to accomplish.

Hedges are designed to massage your market value numbers, a kind of security blanket that softens the highs and lows of the market cycle. But why focus on the fluff of transient market values in the first place? Cycles eventually correct themselves without the unnecessary drama, guesswork, risk, and trading fees.

It’s not the market value of the portfolio that is of primary importance. It’s the actual content of the portfolio and how you deal with the natural dynamics of the securities you own. Why can’t the media reinforce that kind of stuff instead of the emotion of the month?

If a portfolio has a semi-guaranteed “base income” of 4%, a 4% cushion (or hedge) is always in place, one that grows annually with proper asset allocation management, and adds to the market value in upward cycles— nah, too simple.

For the “rest of the story”:

http://kiawahgolfinvestmentseminars.net/Inv/index.cfm/6979

Steve Selengut

http://www.kiawahgolfinvestmentseminars.com/

http://www.sancoservices.com

Professional Portfolio Management since 1979

Author of: “The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read”

Certainly, it’s a no brainer to sell a Jim Cramer, Peter Lynch, or Robert Kiyosaki effort while a “newbies” approach to solving the puzzles of Wall Street, requires some major financial risk. 

Are they responsible for the problems in the financial markets? Of course not, but they do have a perverse, if indirect, impact. By constantly publishing the same Wall Street friendly message, they contribute to the brainwashing. 

These reviews describe a book that Wall Street wants to keep in the closet, an educational and strategic breakthrough that would have allowed most investors to avoid the bubbles and derivatives that caused the three financial crises of our lifetimes — and if you don’t learn something (there will be a test) I’ll refund your purchase price. 

For the rest of the article: http://kiawahgolfinvestmentseminars.net/Inv/index.cfm/5758

 Steve Selengut

Author: The Brainwashing of the American Investor

In it, the questions are raised as to how China is going to be paid back the hundreds of billions that they have lent to us, given the huge level of deficit spending already done, and that which is in the pipeline such as the new healthcare plan.