Fed Cuts, Bear Stearns, and March Games

Our Stock Market Game has gone on for almost a full year—that was quick, wasn't it? With 15 days left before the end, the market has been tanking, and we have some high fliers and some low-ballers in our game. Percentage gains in one year have ranged from 2.5% up to 32.3%
down (as of today).

IN THE NEWS
Bear Stearns has nearly collapsed, and was snagged by JP Morgan Chase for $2/share, about 270 million. Friday, Bear Stearns was at $30/share. Hope none of you fine folks out there were heavy in banking stocks—well, unless you were holding JP Morgan. However, diversification will get you through this shakeout of the
stock/housing market. What you won't hear much is who's funding this transaction: you think it's JP Morgan chase who's funding the purchase? Nope—the Federal Reserve is funding the purchase of a private company. Not sure if this is the first time it's happened, but I hope it's the last. Businesses, no matter what the size, should be allowed to fail and rise without the intervention of the government or
the Fed.

Speaking of the Fed, they, being the enabling parent to our shaky economy, made another cut this weekend of a quarter-point down to 3.25%. For those of you holding emergency funds in high-yield savings like ING Direct or Emigrant Direct, you should expect your returns to
sink to around 3% or lower.

March Madness is upon us, which means it's time for the obligatory news stories about how much work productivity is being lost.
See

here.

Or here.
Or maybe here.

I think that the complainers are simply (a) worse at picking NCAA pools than the general public, or (b) hitting a popular event while forgetting how unproductive we get on Fridays, the day before long weekends, or when people take smoke breaks or tank after 3pm.

So stay tuned folks. The dollar is weakening, we may be in a recession, and this time next week, your brackets for March madness will be in disarray. Relax. All these things shall pass—and be
corrected for the better.