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Making a Bullish Christmas in Bearish Times

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A man is at his finest towards the finish of the year;

He is almost what he should be when the Christmas season’s here;

Then he’s thinking more of others than he’s thought the months before,

And the laughter of his children is a joy worth toiling for.

He is less a selfish creature than at any other time;

When the Christmas spirit rules him he comes close to the sublime...

—The People’s Poet Edgar Guest

Ah yes, the season of cheer is finally here. The lanterns are up. Christmas songs are playing. Chorales have come knocking. It’s a merry time, a very merry time indeed. It’s a great time for giving. What about the threat of global recession, increasing employment uncertainty, decreasing global demand for exported goods, financial market volatility, and nasty, nasty inflation? Bah, we mustn’t let all these things stop us from enjoying the holidays!

So have you made your Christmas shopping list? Here are some great gift ideas that can make a bullish Christmas out of bearish times.

Must Buy #1: Something Smashing for the Honey
Never neglect to pay dividends to your honey. If people think disappointing the market can be bad, they should try disappointing a spouse! On the other hand, getting things right with a spouse can be many times better than pleasing the market. After all, spouses never forget and are almost always loyal. (Of course, the latter may be in part due to the fact that the brokerage fees on a husband are much higher than those on an equity security.)

So put on your thinking hat. Two things to remember: (1) Personalize, and (2) It’s the thought (not the price tag) that counts (really).

Must Buy #2: Benjamin Graham’s
The Intelligent Investor
Now that we’ve got the most important one in the bag, let’s look at the other essentials. This next one may be for you or for someone else. I call this the magical book of investor metanoia because, by reading it, your view of the current market will turn from extraordinarily bearish to sensibly bullish.

The author, the father of value investing, humbly subtitled it “A Book of Practical Counsel,” while Warren Buffett, who read the book at age 19 and considers Graham as one of his greatest influences, calls it “by far the best book about investing ever written.”

But we’ve all heard about value investing. Every other fund manager professes to live by it. So why the need to toil through several hundred pages of investing advice when most of us don’t even directly manage our own portfolios?

Well, one reason is that not all fund managers who claim to live by value investing actually do so. Second, in spite of all the talk about mutual funds being the best thing since sliced bread, there may be better alternatives for your hard-earned money out there (more on that in the book). Third, finance is becoming more and more democratized. The fees are much lower than they used to be. Online brokers have made access almost ubiquitous. And, what’s more, Martha Stewart manages her own portfolio so, I reckon, we can too.

Must Buy #3: Gary Larson’s Tales from the Far Side
I love the way Fortune’s Stanley Bing described the ongoing financial turmoil in his October column. It reads, “And the land was overrun by prophets of doom, and with them came four horses, and on those horses were four riders, and the names of those riders were Fear and Anger and Gloom and Panic.”

Depression, I believe, is an acceptable reaction to losing 40% of your net worth. Sure, it’s a paper loss. But most of the money we think we own we only ever see on screens anyway, so all these losses feel just as real. (Imagine how it would feel if 40% of your ATM balance evaporates overnight.)

The solution: Humor, the best (and oftentimes cheapest) form of distraction. And for those of us looking for quick, intelligent humor, it gets no better than Gary Larson.

Must Buy #4: Umbrellas!
Okay, let’s face it. We’re facing a recession here. We can’t get everyone a nice trinket, Graham’s famous book, or some of Gary Larson’s comic strips (even if we wanted to). But we still can’t be stingy and give nothing (or something that’s worth as much). We have to be thoughtful, thrifty, and practical. And the one thing everybody needs (no matter who they are, where they live, or how much they earn) is an umbrella. It is the ultimate one-kind-fits-all gift—and it’s inexpensive too. Pick up some of those really big ones. A couple dozen or so will do and you’re set.

Have a very merry Christmas and I’ll catch you in the New Year!

Print ed: 12/08


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