t-bills and my bank

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I'm a recent GI and a newbie who's been lurking at this bulletin board since about mid-October. Today I had an interesting situation with my bank. Having made some preps as time is running out, it's now or never to decide about some smallish stock holdings I have (low 5 digits). I called my bank for info about purchasing t-bills, and they said one of the financial manager types would call me back. When he called, I told him I was considering selling stocks and buying t-bills. He asked why I wanted to do that. I said I had concerns about y2k. His response was stunned silence. He asked me my age and marital status (i'm 27 and married) then proceeded to tell me that at my age, we shouldn't sell. If we get out now, we're going to miss a huge boom (his prediction: 14-15,000 by the end of 2000). It was a hard sell from his end. He said he'd be very reluctant to put this into motion without sitting down with both of us first. The bottom line was that I hadn't thought it through and would lose out on a big payday, and whoever advised me to do this must be very afraid of y2k (for no reason). He said that a 10% dip in the market wouldn't really be a big deal if I was "long-term" and that a 20% drop is "so contrary to all the predictions that he really doubts it would happen." He thinks the market can only get stronger.

I'll be the first to admit that I'm not a financial expert, but why should he care so much what I do with my money, money that's not even in his bank right now? I am pretty sure I still want to sell the stocks, but this guy was so adamant I got pretty unnerved. I'm still in the early stages of coming to terms with what I'm preparing for, I guess. Has anyone else gotten resistance or a lot of questions from the bank when they tried to move money around (or take it out, which I think I might do from this bank pronto)?


-- nance (nancyw@mailcity.com), November 19, 1999


I can't tell you what you should do with your stocks directly, but you must try to get away from the mainstream spin that permeates this mania, and look at plain old valuation levels, dividend yields, etc. compared to the 70-year norm.

As a start, may I suggest that you go to http://www.investech.com There, on the left side, you can click on download of a sample issue FREE. It will NOT be the most recent issue, which I just got tonight, but the message and graphs in there are consistent, and the message is very clear when you look at his graphs and charts.

Jim Stack is one of the (near-extinct) value and common-sense advisors that you will ever find.

Do this NOW. You can be reading it in minutes! If what you see in there doesn't put things in perspective very quickly, then I would say that you are too brainwashed to make an honest decision.

BTW, I am getting the same treatment by my bank! I have an account that is 100% M.M. funds, and will be moving to T-bills shortly, and possibly bonds WHEN Investech's bond models turn upward. Well, they are hounding me (thank heavens for answering machines)to get me to come in and "talk over" my account! THERE IS NOTHING I WANT TO TALK ABOUT! IT'S THEY who are trying to initiate some buying of mutual funds, for which they get commissions, of course. This is the same bunch of financial prostitutes that made almost $2 BILLION last year, and today announced that they are dumping 6000 employees over the next two years!!!GOTTA GET THEM PROFITS WAY UP SO THE CEO's CAN GET FATTER!

The only reason I DON'T answer them back is my utter contempt for them and their tactics. I refuse to converse with idiots.

Bulls make money, pigs make money, hogs get slaughtered.

-- profit of doom (doom@helltopay.ca), November 19, 1999.

Nance, Think for just a moment. The fact is that everyone can predict what the stock is going to do. That's right. I said everyone can predict what the market will do. I can. You can. Your parakeet could to, if you have one and it could talk. Maybe the banker is right. Maybe your parakeet is, too.

The problem is in the consequences of failure. Suppose you leave the money in the market and the banker is wrong. You say the amount you have in isn't much - "smallish five figures." I bet that investment represents some scrimping and saving on your part. I bet it means something to you - putting off buying a car, not going to the movies every weekend, not going out to eat eventhough you didn't feeling like cooking. If the banker is wrong, will his employer cover your bet? Replace your losses? Polly wanna cracker? No, it's your money and your responsibility.

It's your gamble. Let's be clear about this one. The market is totally inflated right now, y2k or not. The market inflation is one reason why Greenspan has been raising rates, not because the price of gas, milk, eggs and washing machines has been going up. It's so inflated now that there is absolutely no relationship anymore between stock price and earnings. Everybody is betting on the come. Everybody - except the people who have already gotten out. Get this. For these stockprices to make any kind of historic sense, everything in this country is going to have to work perfectly for years to come. No y2k problems. No foreign market recoveries. We're pumped up now on the backs of other people's misery in the foreign markets. That's the other reason rates are inching up - to keep the foreign money here. So everything here in the good ole USA has to keep running perfectly.

Well, what do you think? Are you willing to keep playing the slots?

Look, why should he care? Don't you understand? His job, the institution he works for, his home mortgage, his kids' summer camp money - everything this guy is, everything he has and wants, his community status, the way people look at him in Sunday School class, just MIGHT be riding on preserving the illlusion, the perception of mass confidence. You specifically, directly and personally attacked him. That's right. You said, "I'm not sure I have total confidence in the most overblown aspect of the system to protect my money, what I've sacrificed, anymore." I know you don't think so, it's not personal. But it is. It is personal. You have to trust him. He works for the bank.

Decide whatever. You can either act in the knowledge that you are ultimately responsible or not. Either way, it's your res

-- Magnolia (Magnooliaa@yahoo.com), November 19, 1999.

Nance, you are responsible for the money, the knowledge to invest it and just when the speculative bubble nervousness becomes too much for you. Follow your gut.

There are three kinds of people in this world. Those that MAKE things happen, those that WATCH things happen, and those that WONDER what happened. Which one do YOU want to be?

-- Lobo (atthelair@yahoo.com), November 20, 1999.

Nance: Sell stocks. Buy gold and silver. Liz

-- Liz Pavek (lizpavek@hotmail.com), November 20, 1999.

Nance, Sell the damn stocks quick and buy gold and Treasuries through a Treasury Direct account. You can download the forms online. It's easy. I did it myself after I sold my stocks.

-- Mara (MaraWayne@aol.com), November 20, 1999.

Profit of Doom,

Is the market being manipulated? And what are the Achilles heals?

-- the Virginian (1@1.com), November 20, 1999.


Rather than listening to your banker, you might consider how Warren Buffet views the current stock market.


Warren Buffet is considered the world's greatest investor.

At some time in the future the stock market may indeed offer some wonderful opoportunities, but if you are broke it won't do you any good. Preserve your capital as Mara suggests above. Or you can do it a little easier by opening an account with Vanguard and buying their Treasuries only MM fund, which invests only in Treasury bills. The advantage of this approach is that you can write checks against your balance at any time. There are some restrictions on the number and amount of your checks, but you are pretty liquid. Additionally, and more importantly, the money is out of the bank, and not subject to the withdrawal pressure created by the bank fractional reserve system.

T. Rowe Price, and the American Century fund family also offer similar arrangements, and a comparable T-bill only fund.

I have a direct deposit account with the Treasury, but it is far more difficult to deal with the treasury than with the mutual funds, particularly when it comes to withdrawals.

Gold is also attractive, but gold mining stocks are subject to infrastructure requirements, and I am a little concerned at present. The only sound way to buy gold is through coins, and take physical posession, which means that you have to get them and hide them.


-- dave (wootendave@hotmail.com), November 20, 1999.

"He said he'd be very reluctant to put this into motion without sitting down with both of us first. "

So you can see the hypnotic gleam in his eyes? and get one for yourself?

I'm sorry but this sounds too much like the Pod People or Body Snatchers or whatever. Cult group brainwashing.

Think Risk/Reward here. That's what HE'S doing, dammit!

-- Getting Sleepier? (you@vill.obey!), November 20, 1999.

"He said he'd be very reluctant to put this into motion without sitting down with both of us first. "

At that point in time my reaction would have been to tell him he has no say, absolutely zero say, on whether or not to put it in motion.

Your money, your decision. If he's reluctant, then fire him -- take your money elsewhere.

This arrogant attitude by bankers really irritates me. He's reluctant, eh? He's toast.

-- I (hate@all.bankers), November 20, 1999.

I think this "in it for the long haul" is bull shit!! What is the risk here? You only have a few months and you will be able to see who shakes out and survives y2k/market fall. You will be able to buy stocks in those companys, THAT ARE SURVIVORS, for ten cents on the dollar. We are in a cash position and we will be moving back into the market after the dust settles....if there is a market! If any banker told me what to do with my money, I would draw it out and go to another bank. Its none of his affair...its YOUR money! Its just that the banks have gotten so used to playing with your money that they have forgotten that its not theirs.


-- Taz (Tassie123@aol.com), November 20, 1999.

Your money, your responsibility, Nance.

I agree with those who said that your banker's comment about "(being) very reluctant to put this into motion without sitting down with both of us first", set off warning bells and red flags with me too.

My financial advisor is a "DGI". He made his case for buy and hold. However, he ALWAYS defers to my final decision (it killed him to have to liquidate the portfolio we worked so hard to put together, but after telling me his opinion, he shut up and FOLLOWED ORDERS. That is why I plan to do business with him next year. (I may be the only customer he has left).

Nance, your banker has forgotten that you are his employer. Don't forget it yourself.

-- Clyde (clydeblalock@hotmail.com), November 20, 1999.

Hi. Glad you showed up. since some sleazy troll hacked this thing, I'm probably jetisoning this post into cyber space.

-- Dave (aaa@aaa.com), November 20, 1999.

Just as a note. I pulled out of my stocks and mutual funds in August 1998 because I was concerned about the risk of the markets at that time. Put the money in T-bills and money market fund. My rate of return since then has been as good as or better than the original stocks and mutual funds that I was invested in and with much less risk. Keep in mind that there are only a few stocks that are going to the moon. Many mutual funds and stocks have suffered tremendous declines since 1998. The Dow, S&P, Nasdaq indexes are heavily weighted by these bottle rocket stocks. If you are invested in a standard mix of stocks you should do as well in T-bills and money market funds. If it turns out that Y2K has no impact on the market (and we should know that within the next six months) you can get back into the market without missing much. Keep in mind that stocks that skyrocket up always come back down and usually within a year or two based on the behavior of the internet stocks this past year. If you are in it for the long term like the banker said, then being out of the market for six months shouldn't be a problem. There's that saying, "Buy low, sell high". Well, it's high right now. Good luck. And do what you feel is best for you.

-- peabody (peabody@yahoo.com), November 21, 1999.

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