Paul B

Paul B. Farrell: 10 short-term ideas to beat debt doomsday

What to do when market volatility strikes? WSJ's Intelligent Investor columnist Jason Zweig says unless you're a real investment professional -- and maybe even then -- sometimes the best trading move is not to trade at all.

ARROYO GRANDE, Calif. (MarketWatch) -- Join America's new "mad as hell" club. You want short-term investing "solutions?" Stick with me, today we have 10 fabulous short-term solutions, solid tips for readers worried about the coming "Debt Bomb Explosion."

Jack's challenge got me thinking: "Paul, your latest column is another example of breathless fear-mongering without any trace of a solution for the predicted Armageddon. I cannot find any value in your Chicken Little rantings. So I have to conclude that you are simply an idiot."

In volatile market, stand pat

OK, OK, I get it. We will get you the solutions you need to invest successfully in the short-term. But first, you're going to sit through 10 more reality checks exposing Wall Street's dark conspiracy to control the American mind, your money and world markets. This is what I see, a steady stream of warnings that also reveals why most investors focus mainly on short-term "solutions," why you tune out long-term "solutions," and why the Debt-Bomb Explosion moves inexorably closer. Listen closely:

1. Trillions in debt: Minneapolis billboard, a grinning George W. Bush. Caption: "Miss me yet?" He never left. His short-term Reaganomic solutions still haunt us taxpayers. Trillions in debt. But worse: Millions have forgotten his tragic legacy.

2. Wall Street reforms dying: Then a BusinessWeek review of Boston University. economist Larry Kotlikoff's new book "Jimmy Stewart is Dead: Ending the World's Ongoing Financial Plague with Limited Purpose Banking." He argues for radical financial reforms, warning that Obama's in Wall Street's pocket, "putting a Band-Aid on cancer." Earlier in "The Coming Generational Storm: What You need to Know about America's economic future" we heard his long-term warnings of the coming collapse of Medicare and Social Security. No one listened then either.

3. Obama approves Fat-Cat bonuses: Former IMF economist Simon Johnson warns: Obama "Still Doesn't Get It." Bloomberg reports: When asked about J.P. Morgan Chase boss Jamie Dimon's $17 million bonus and the $9 million for Goldman Sachs CEO Lloyd Blankfein, Obama said: "I know both, savvy businessmen. Like most Americans, I don't begrudge people success or wealth." They're not "people."

4. Class warfare ahead: Next, more proof Obama really "doesn't get it:" Only 4% of folks making over $100,000 fit the new Northwestern University study of unemployment. In contrast, Americans in the bottom fifth suffer most, 37%-50% are underemployed. Warning: This widening wealth gap is more dangerous than terrorist's threats.

5. Doomsday clock's ticking: Then, comments from Barron's about Hong Kong economist Marc Faber's warning: "Zero Hour, America's debt is junk." Listening to Faber's "DoomBoomGloom.com" messages you can even hear the countdown tick, tick, ticking till the "Debt-Bomb Explosion." Till the third Wall Street meltdown of the 21st century. The "Great Depression II." Till Palin and the "Tea Party of No" not only advocate a new "American Revolution," but trigger one ... Tick, tick, tick ...

6. The warnings are relentless: USA Today says Wall Street's "bastardizing ETFs," creating a "treacherous" casino extracting more fee and commission revenues.

7. Next, a Bloomberg-BusinessWeek headline: "Wall Street's New Flight to Risk" about leveraging the Fed's cheap money in "exotic bonds."

8. Then Atlantic warns: America's $1.7 trillion commercial real estate bubble is "about to meltdown."

9. And The Economist warns: "New dangers for the world economy: When the crisis started, governments helped save the world economy. Now they are the problem." We hear those same fears from TARP's watchdog: The "government bailout has increased the risk of deeper economic crisis."

10. And Foreign Policy magazine predicts: By 2040 China's GDP will explode to $123 trillion (three times America's), but China's central bank is already doing what Bernanke won't, increasing bank reserves to dampen a bubble, another show of their growing power.

These red flags scream: "New meltdown, dead ahead." And yet, most investors still can't grasp the futility of trading in a market totally controlled by Wall Street's "too-political-to-fail" bankers who manipulate clueless politicians with lots of campaign cash. Investors want short-term solutions because we've been brainwashed into believing short-term is all that matters. We've lost the ability to see or think long-term. We're blind, deaf, in denial.

But still I listened: You don't want long-term solutions, don't want to hear about any "Swiss Family Robinson" plans urging you to buy a well-stocked, self-sustaining farm in the mountains, away from populated areas.

And now I also realize that on a deeper psychological level you only want short-term solutions because in your heart-of-hearts you fear there is no "long-term" future to invest in, because America has no "long-term" future. Because you hear the "Doomsday Clock" ticking, hear Faber warn: America's clock's at "Zero Hour."