Folks, we're in a recession right now. To paraphrase Warren Buffett, this may not be a recession according to the dictionary definition of the word; still, if you ask the question from a common sense perspective, the answer is painfully clear. During a recession, unemployment generally rises, production slows, spending declines — in short, the happy times slow down and the bad times gain steam.

Through our investing, we can combat the recession, achieve growth, and keep our heads above water (or fly high). To help us in that endeavor, we must understand the effects of the recession so that we pick the opportunities out of the blood on the streets.

Continue Reading How Bad Will This Get? The Recession. ››

When the markets are flying high, value investors tend to sit back and let things happen. When they crash, we must start looking for opportunities — dissecting information, scouring annual reports and proxy statements, and evaluating which companies will survive and which ones will die. (That's why I haven't been around as much lately. Sorry.)

Most "regular" people don't look beyond the stock price as an indication of how things are going — today's opening price versus today's closing price is an indication of how things will progress. Most "analysts" have something to sell, so the recovery is always just a quarter or two away (unless they're eternal bears — then the crash is just a quarter or two away). And then there are the realists — the Warren Buffetts, et al. — that say, "Here's the truth. Don't like what you hear? Sorry, but it's still the truth."

Continue Reading How Bad Will This Get? The US Dollar. ››