Zero visibility and taxes brings business to a halt!

Morning folks!

I heard a very good description of where we are economically the other day.
Jack Welch, the former CEO of General Electric said that we are in a fog. As far
as business is concerned there is zero visibility. What that means is conditions
are so bad companies can not even plan or project 30-60 days out. They are on
day to day and that is just one of the reasons why the economy is so bad and
getting worse.

Then add the layoffs and what that does to the morale of a company and how
that down draft has the power to destroy that company. Reorganization takes time
and opportunities are missed.

You may ask why am I writing about the economy more than domains? It is a
simple answer. If you have the most beautiful suite on the Titanic and the ship
is going down and you are busy redecorating, you are in serious trouble. You
have the wrong focus. You also need to read yesterday's post as well as previous ones. There is a thread and theme that runs throughout.

I also like being on record. I am willing to stick it out and believe what
I say and think. Does not mean I always get it right. But time and the record
have proved more often than not. My posts about what is HERE now started 1-2
years ago and just kept intensifying. The reason, the numbers just did not add
up and it was just a matter of time before numbers trumped the bullshit. People lie, numbers don't.

Last week I wrote about the lack of confidence and how that is the
epicenter. Well, now there is much more confidence. More confidence that things
are going to get much worse. That is the only thing I can see any confidence in.

How you handle these troubled waters is going to determine many years of
your life from this point forward. So it has nothing to do with your cabin and
everything to do with the ship. If you have $10 million and hyper inflation
comes (And we are certainly planting the seeds for that to happen) you are
broke. So things can change quickly and drastically. Things can truly spiral out
of control. This is no drill. This is the real thing. We are witnessing an
economic disaster so much bigger than 1929 that I don't have a calculator that
will even go that high. The good thing is that it is worldwide. The bad thing is
that it is worldwide. Riots, unrest and governments falling has the power to
overshadow the economics at some point. War becomes inevitable.

Right now we are in a deflationary phase. When something is deflated you
try and inflate it. The here and now is deflation, but you can't be blind to the
other side. We are getting both, just don't know the timing. What's important is
being AHEAD of whatever happens. One step ahead and things are fine, one step
behind and your world can come crashing down. It's tough to make money. It's
even harder to keep it.

A lot of things are going to happen in the next 90 days. The next 60 could
be the worst we have seen until this point. Tax time is getting closer and
unless you are in Congress, we all need to pay that tax and that is where the
first true test and bottleneck happens. That is going to determine where we go
from there. Likely some minor relief followed by the very darkest days we have
ever faced.

That's what I see coming. Cover your eyes and hide or be proactive. I have
been preparing for this for a very long time and I am still not ahead of it.
Nobody is really ahead of it. The quality of life as we know it is in jeopardy. The fallout has
yet to even materialize.

Cash is king, but income generating domains can become more valuable than
cash. The payouts will adjust to the market and inflation. They are down now
because of deflation. Accept it. Don't dwell on it. The market is working. The
reward for them will be most evident when that inflation comes.

Have a GREAT day!

Rick Schwartz

First National Mattress Now Open for Business

Morning folks!!

Passive aren't we? That can't happen. They wouldn't do that. That's
impossible. That could never happen here. People would not stand for that.
That's impossible. That's impossible. Keep telling yourself that and maybe that
will be like clicking your heels in Oz and stopping it. Now let's chant it together.

The state of California can't/won't send refund checks for at least 30
days. Now chant the above line. That can't happen. They wouldn't do that. That's
impossible. That could never happen here. People would not stand for that.
That's impossible. That's impossible.

Iceland collapses. Sing..... That can't happen. They wouldn't do that.
That's impossible. That could never happen here. People would not stand for
that. That's impossible. That's impossible.

Mexico is near collapse Sing....That can't happen. They wouldn't do that.
That's impossible. That could never happen here. People would not stand for
that. That's impossible. That's impossible.

Plug in whatever event you like. Banks, brokerages, car makers, countries,
states, cities, retail chains, You'll be busy all day. All the things that can't
happen that already have happened and more is happening at such a rapid pace
NOBODY can keep up with it. NOBODY can figure out where it is going. NOBODY
knows what to do to stop it. Worst of all the folks in charge of fixing it are
all a bunch of crooks. The CEO's are busy lining their pockets before the ship
goes down while going on camera saying things are great. The legislators are
busy covering their asses by passing new bills that will obscure the other stuff
and while they are at it their job is to make you and me pay taxes and lock us
up if we don't while they conveniently forget or didn't know and then pay
without the interest and penalties that we have to pay. So the crooks are in
charge and so they get Blago and they get Madoff probably just as a decoy to
keep the attention off of them. The crooks are in charge and now they are about
to screw you even further. Let's all chant That can't happen. They wouldn't do that. That's
impossible. That could never happen here. People would not stand for that.
That's impossible. That's impossible.

I was scared to say what I thought in the summer because folks would think
I was crazy. How do you tell folks you are moving your $$$ out of Wachovia when
you fear it will collapse and nobody anywhere is suggesting such things? You
don't. But quietly that money left Wachovia. I am not much of a chanter. I just
try and do things before there is a need to do them. Maybe part of that is
living in Florida. You MUST be prepared for hurricanes in season or else. No 2
ways about it. So being down here gives a certain mind set.

Last month I made a post and said that 'Your favorite restaurant will go
out of business' I added the word 'maybe' after it because even just a month ago
I thought people would think I was crazy to say that. Then a few days later I
took a ride and I began to see just that. Restaurants, GOOD restaurants doing
business were closing. Who and when are the 500 Circuit City stores that may sit
empty for years have another business in it? McDonalds may be doing well but I
bet they close stores that are under performing. This is just the beginning of
the collapse not the end of it. This is just a pre-storm squall. The main part
of the storm has yet to manifest itself. The fallout has yet to manifest itself.

So here we are and things economically are going to get dire before they
get better. As I mentioned last week, the $250k insurance on FDIC expires on
12/31/09. To me, THAT is a big deal. They may extend it, they will be forced to.
But just the fact that they did that has me questioning many things. The only
thing keep us afloat is what confidence we have left and if that should out!

How long will it be before we wake up and hear the banks are all closed for
a week? Or there is a run on the banks and it gets out of control? See you need
to ask these questions BEFORE they materialize. Crazy you say! The chances are
you are right. But that does not mean that the hurricane that comes is not worth
preparing for even tho the danger of damage and injury may or may not be
present. You can't prepare once it is too late. But you can always chant That can't happen. They wouldn't do that.
That's impossible. That could never happen here. People would not stand for
that. That's impossible. That's impossible.

My friends, we have been robbed. That is the short and skinny of it and
what we are watching is an epic cover up as not only were we robbed but now the
pricks want our $$$ to try and fill the banks up again. When was the last time a
bank forgave a loan it made to you?? But that is exactly what is happening. We
are now allowing THEM to default and fund that default with our money and
retirement funds as they change the rules on you and me in the middle of the game and tighten up while
doing the exact opposite themselves.

There is a tornado on the radar. It may hit, it may not. I bet you get your
family to safety first and then worry about whether it hits or not later. You
prepare for the worst and hope for the best. That's the deal.

So I write this. I believe this. I sincerely hope I am wrong and by springtime the flowers will bloom and all will be well. I want that too. So I wrestle with pulling the trigger to post
it or just saving it for my own. If I save it for my own I don't have to deal
with any fallout, On the other hand, this is what I see and this is what I am
preparing for. While I don't suggest putting your $$ in your house or under your
mattress as that has great risk as well by fire or robbery, I do suggest having enough cash money or other instruments
in other places than a bank to live on for 6 months to a year. Before it was
just diversify in stocks. Today you have to diversify your cash. Some think the
stock market can't go down further. I tell them take a dollar and cut it in half
you have 50 cents. Cut it in half again and you have a quarter. Let me know when
you can cut it in half and get to zero?

Have a GREAT Day!

Rick Schwartz

Targeting the End User

Morning folks!!

Let's face it 98% of the domain industry is incestuous. That means that
most domain sales are to other domainers. Nothing wrong with that. But don't be
in denial either. The true test of 2009 and beyond is can the industry reach out
to end users? Now I am not putting down anyone flipping domains inside the
industry. Let's face it, that is one of the engines that run the ship. It's just not
the best engine and in time that engine will wear out. We already see evidence
of it happening. Don't fret. It's just another mile marker on an historical
path. This era may be the very last chance to get a great domain from other
domainers. Crap, crap you will always find and you will have a market for it. In times like these the last thing you want to buy is crap. Crap is a liability not
an asset!
Crap does not produce income. Crap means you gotta find someone less
knowledgeable than you to buy it. Like I said, we won't run out of crap. On the
other hand great domains are less and less available. They are being used or
sold to end users and will likely never be on the market again. So every passing
day there are less great domains available and crap will become harder to sell.

Timing as I say often is everything. Babe Ruth may have been the best
baseball player of all time but he did not make the most money. Either did Roger
Maris or Mickey Mantle many years later. in the 1930's Babe Ruth made a lot of
money for the day. But he was not filthy rich like we find today. The superstars
today make tens of millions. Hundreds of millions.

TV took 40 years to really hit the big $$$. When expansion went from 3
channels to 500 channels they thought no way could they survive. They were quite
wrong. They survived and thrived.

I always look to history for the roadmap to the future. ALL the answers are
back there. Finding the parallel is where you can make lots of money. The best
thing with the Internet and domains is there are so many of those parallels.
Besides what I mentioned we have real estate, oil wells, commercial property, storefronts and
even migration of all things. Steve Jobs made the following statement and that validates my way of thinking. He said, 'You can't connect the dots looking forward. You can only connect them looking backward.'

Little by little the industry will break out of the incestuous upbringing
and take a role in the larger world of business and commerce. It will take 20
years for that to happen. May be a little less than that as we try and
accelerate things. Maybe less with the aid of a catastrophic financial meltdown.
How does that help you ask? New thinking equal new solutions and domains are one
of those solutions. In 2002 we witnessed the dot com crash, collapse and
meltdown. From the embers of that event, the domain industry was born. Today we
are witnessing the Main Street crash, collapse and meltdown. The Internet stands
strong to the surprise of many. Both sectors will emerge stronger after it is
all over. So prepare for the meltdown so that you can be ready for the
aftermath. But this time, domains and the Internet are taking on their proper rolls for the very first time. It is clear that Brick and Mortar is failing. It is also clear that the Internet is succeeding. Does Circuit City need 500 stores? Does Amazon? New thinking is required. Telecommuting has to be used by corporate America and embraced and those expensive offices downsized or even eliminated. If you want to survive from this day forward, you can't have your hand out. You have to sell more, make profit and put out a good product that people want.

Do you feel like you are on a roller coaster reading these posts? Good!
Because it is a roller coaster out there so hang on. There are very bad lows and bad things happening
and there are very high highs where great things are happening. You MUST be
focused on BOTH to navigate through times like this and seize any of the
opportunities that are out there. More opportunities and a tremendous amount of
pitfalls. Some pitfalls disguised as opportunity. So 2009 will either be your
best year or your worst year and it depends on you not the economy. More than
that, it may be based on your patience and timing. You don't need to do 100 or 1000
deals this year. You need to do just a selected handful that will change your
life. In times like this it is ok to slow down the pace and be selective. Pick your moments. Pick your targets. Fine tune what you are doing. The end user is out there. But as I have said, they will come one need and one project at a time. Our job is to let them know that a great domain name is their goal in life. The new standard in cool. The ultimate ego stroke. And unlike other 'Feel good' methods, that a great domain name will transform their business and leave their competition in the dust..

Have a GREAT day!

Rick Schwartz

NBC’s Big Superbowl lie??!!

Morning folks!!

It's the 4th quarter and what started as a post on reviews of the Superbowl
ads got derailed by the possible lie that NBC is circulating about the ads sold
and prices paid.

I counted at least 20 some odd commercials of the 67 ads sold that were to
companies related to NBC. Plus the NFL ads that are obviously gratis and part
of any package they put together. The dirty little secret is while NBC ran
around saying they sold all 67 slots at a record amount, reality seems like it could be a
flat out LIE! Were THEY the #1 advertiser? Their related companies bought nearly one third of their own advertising slots. It seems like they billed their inflated rates to
look good and keep the rates high for other advertisers. It may be that they screwed their own
customers. That may be the reality of things.

So the story was not who had the best ad or who had the most wasteful ad.
It may have been the outright deception of NBC putting a happy face on a face of lies.
That's the kind of crap that got us to where we are in the first place.
And, if there were 67 ads in addition to the 20 something by NBC companies....then
Nevermind. ;-)
Have a GREAT Day!
PS: The Godaddy 2 minute warning ad was very good and the Doritos ones were very funny.

Stupid Superbowl ads may piss some off

Morning folks!!

It is not in vogue to piss away money. The days of lavish
corporate spending has been suspended until further notice. Do you put an ad
on for the Superbowl or lay off workers? THAT may have been the choice in some

So now ads have much more meaning than ever before. If the
public views your ad as wasteful, they are not going to reward you. That ad may
actually cost you customers. Ego stroking ads are just not going to fly. And if
a company does go there, it better be knee slapping funny.

These are the most important ads ever. Not for doing more
business but to see if the corporate heads and Madison Ave have their heads on
their shoulders or their heads stuck up another part of their anatomy. Nobody
can afford to put on a dud and branding needs to take a back seat to solid
results. Their stockholders will be watching!

The football game is a sideshow for me this year. This is one
year where the ads are going to be scrutinized in a manner never before done. A
company could be massacred by the media if they screw up or are seen in a
negative light. All I can say, BIG GAMBLE! Good Luck!

And whichever group GoDaddy's ads ends up, a big thanks for
bringing domains into every living room in the world once again!

Have a GREAT day!
Rick Schwartz

The Audacity of Nope

Morning Folks!!

I get a lot of emails each day looking to buy this domain or that domain.
Since I don't sell wholesale to domainers, my one word answer when I even answer
one of these emails is 'Nope.' Pretty simple and straight to the point.

Most can handle that. Then we get to the ones that can't. They give me a
litany of reasons why I should change my mind and then usually followed by some
low ball offer that shows that even the domainer is clueless. Then I get pissed
at myself for even wasting my time responding.

Sometimes they will offer to even trade a domain. But domainers are not
very good at trading. See when you want the domain that someone else has, you
have to offer in a trade much more than that domain is worth to get to a deal.
In baseball if you want Derek Jeter, you don't just offer another mediocre
player that plays the same position in trade. That would be laughable. You may
offer a pitcher that won 20 games and a rookie shortstop with a promising future
along with 2 draft choices. THAT is a trade and THAT is what domainers need to
learn if they want a successful trade.

$25,000 for a domain won't motivate me. You will get a famous 'Nope. You
want my domain, offer me a domain or several that would enhance my collection.
That would give me a higher monthly return. That would be attractive. Trades
trump dollars. Structured correctly they can be very rewarding for both parties.
But if you want a domain, try offering something substantial in trade.

I learned long ago that the word 'No' is the single most powerful word in
any of our arsenals. Learning to say no is difficult. Then when you get really
good at it, you can say 'Nope' and feel no reason to defend your decision.
That's the audacity of Nope.

Have a GREAT Day!

Rick Schwartz

Domain Channel shrinking? Nonsense!

Morning Folks!!

I am hearing talk that the domain channel is getting smaller. That's nonsense. It is not getting smaller. It is expanding and changing and traffic is going to more diverse places, but not getting smaller. The way or what some COUNT may may make it seem like it is getting smaller but that is when you don't count the right way. Less domainers? Probably. Less renewals of worthless and idiotic domains? Probably. Is that a bad thing? If your boat has 500lbs of water in it, is it a bad thing to bail that water out to getter better mileage and have it go faster?

What is happening is some sectors are experiencing loss of market share because domainer's are doing everything they can to develop their properties on one hand and many are becoming their own registrars on the other. They are doing joint ventures. They are engaged in creative deals and transactions and leases. They are working and engaged and not relying on what worked yesterday.

In 2007 I sent about 95% of my traffic to PPC. As we enter 2009 that number is about 60%. It took 1 year to readjust 35% of my traffic to keep my income from declining as much as it could have and in some cases even rise. Payouts are down for some domains and up for other domains. Some parking companies are still innovating while others are not and some will disappear or consolidate or sell out. There is probably some real pain to come, but I also believe as they wipe out those that were in the business of abusing the system, the system will get stronger and payouts will no longer be strangled. Payouts are important whether you use ppc or not. This is what drives everything. More sales by better traffic and less crap is what is needed. Bail the water out because that water costs us all a LOT of $$$.

What was a 95% PPC industry is now in decline and THAT is the sector in decline and getting smaller. That is before I even bring Google into the conversation. But some companies are more innovative than others. Some understand domains more than others. Some have different views and ways of doing business. Some even have the potential to get stronger and take the business away from their competition. But to do that, you have to do something dramatic and bold. Business as usual means that each month you will watch your business shrink. The TRICK right now is to stabilize things and put yourself in a position to grow. If your numbers are flat for 2009 you are a big winner. If your numbers were flat in 2008 you would be earning a lot more today. The enemy is decline. So treading water in times like this is a great victory and successes are oh so much sweeter.

Being aggressive will be in vogue and that is why the domain industry is about to experience some huge growth. Again, it may not be on our timetable but after the collapse of 2002 it was domains that I always said would be left from the burning embers of the first collapse. Domains experienced great growth in value as soon as the market recovered. This time the growth and rewards will be much bigger and more important.

Domains as a tool are getting stronger and more important. The demand by END USERS is up. The demand inside the industry is much less important.

Times may not be good, but times have never been better for deal making with end users. That is why 2009 will be about going outside the walls and confines of the industry. Success will be found, just not in the same places and not with the same people.

Have a GREAT Day!

Rick Schwartz

Are You Prepared for the Meltdown? Door #1 or Door #2

Morning Folks!!

We are at a dire point economically and the worst part is the fallout from
all the closing and layoffs have yet to be felt. If 1/2 million people get laid
off THIS WEEK it takes months before that really impacts the system. Some will
impact immediately. The vacation, the eating out, the gifts, and then the
important stuff follows later. You can't put a happy face on this. We are in the
midst of a total economic and banking meltdown that will melt everything in it's path like lava flowing as a river after the volcano explodes. I watch this day
by day and the events that are happening are so big and happening so furiously
fast that the news can't even keep up with it. Each passing day things are
exponentially worse. With taxes right around the corner, the pain is about to be

So we are left with a couple of doors. If you think things will turn around
by summer, then door #1 is for you. If you think things will be fixed by summer but
you are not sure which YEAR that summer will occur in then door #2 is for you. I
am a door #2 guy because I have yet to see anything to give me CONFIDENCE.

I remember in 2000 and using the word 'Collapse' to describe what was to
come. Most thought that was much too strong a word. It wasn't as we look back.
Today we face something much more serious and 'Meltdown' is the new word and I
could only hope to have been content with collapse. 2008 was a collapse and
2009-2010 is going to be the meltdown. I believe day to day life as we know it
is in jeopardy and that is something I have NEVER seen before. Never felt
before. Never had an indication of before.

Privately I started to write about this last summer. I am sure at that time
even my closest confidants thought I exaggerated things. Looking back they know
I got it right. I said early on that Main St. and Malls and every town in
America was going to look different. Well, it is only a few months later and
here we are.

Today for the first time I am using the word meltdown to describe what I
see coming. But this meltdown could become political as well as economic as we
have seen in peaceful Iceland. This meltdown may not send a 'Coming soon' note.
It may just show up on our doorstep one day when you wake up in the

All you can do to prepare is to pay every bill you have off and make sure
that your monthly 'Nut' is as low as it can possibly be. If the common wisdom is
to hoard cash, then your job is to question the common wisdom. Your job is to
always question the common wisdom. The 'Experts' keep being 'Surprised.' How the
hell can an 'Expert' be 'Surprised?' He is paid to be in front of things not be
surprised by events and be behind the curve.

There are things a government can do to help. There are also things a
government can do to make things exponentially worse. The problems are so deep,
so systemic, so out of control, that you really have to stretch your thinking to
believe this can be fixed in a short time.

567 Circuit City stores are about to be vacated and empty. 371 Linens and
Things. Hundreds of other stores with every brand you can think of will be
shrinking. Macy's closing at least 12 stores. When do you think these properties
will be occupied again? By summer???? I see more of you going over to door #2.
Smart move if you ask me. I can't even describe what I see coming. You can't say
this stuff out loud. But that won't stop the lava.

Have a GREAT Day!

Rick Schwartz

It’s All About Circulation and the Trash Can

Morning folks!!
When I was a kid like many other kids, I collected coins. In coin collecting 'Circulation' is the keyword. How many coins in circulation is
the basis for value. The less available, the more they would normally be worth.
It is also the word used to describe the condition of a coin. Uncirculated means
it has not been used. It is brand new.

Later in life I was selling products and I printed millions of brochures.
In this business, part of how I judged it was exactly the opposite. Larger
circulation was better. I hired many to pass out brochures. I knew they had done
their job when I began seeing them in the garbage. That meant that I flooded the
trade show with my material. I had the market circulated. They may not need my product but my job was to make sure they knew it existed. I planted the seeds that
needed to be planted and just like in real life, most don't germinate into
sales. But a percentage do. My focus was to make the conditions right to
penetrate that percentage. The garbage can was my odometer. They were empty the
first day of a show. But there would be a point during every 3 day show that I
would hit critical mass. Where attendees knew my product was available. Where
any interest was evident or sometimes not so evident but actually kept for
reference and another source.

So enter domain Industry. Getting the message out of this great product and
investment known as domain names. Get out not to a trade show with 50,000 people
in a confined space for 5 days but to an entire planet?? How do you circulate
that?? Network Solutions was a registry but was dysfunctional. It certainly was
not an advertising or marketing machine like So the head of the
snake (Network Solutions) was not even in the game. They were passive. The few
that were into domains were each working in their own universe. Many scared to
step out of it and the rest not wanting to. Trying to keep it all a secret. But
since few if any were really communicating back then, who knew where anyone

The first chance I had to 'Circulate' about domains was the adult industry.
At first they rejected what I was saying. So I would venture to other industries
like real estate where they would reject it much more intensely. That happened
at other venues as well. So I went back to 'Jonathan's World' in late 1996 to find out it
was there no more. Eventually finding my way to Ynot and bumping back into
Jonathan. Jonathan became my single biggest aid in circulating my far fetched
ideas on domain names. He was a well respected and innovative webmaster with a
huge persona. In between that time we had met at a pay per call show in Los
Angeles. Just 1 day after the first adult Internet gathering happened. I pulled
out my list of domain names from my back pocket (all 126 of them) and we sat for a while and discussed what I had and
what I saw coming. He saw it too and that really was the beginning. He acted
like a line backer protecting a quarterback and allowed me the platform to
circulate my crazy beliefs. That was aided by payouts that were 100x what the average was at that point in time. While most were making 1/10 of one penny per visitor, I was earning a dime. I actually thought my calculator was broken or I was doing something wrong until the checks strated coming in. The checks started coming. Nothing was broken. It just proved there was gold in them thar hills. Gold nobody believed was there until that moment. Circulation had finally begun. Now to repeat it 6
billion times. And if not 6 billion than at least every English speaking

So I can get bogged down on these early stories all day. A LOT happened between 1996 and 1999. No period in my life has ever matched that era. It was like decades packed into months. Let's fast forward
to 2000 and the first domain board. Just my first attempt to have something
stand up on domain names alone. A chance to circulate and have domains stand up on their own. A starting point. I made a few opening posts and figured I would talk to myself. One by
one they came. Eventually more boards opened. To me, more circulation. More chatter.
More soldiers. Then 2004 TRAFFIC. Again a way to circulate the message with
slightly more assistance and a bigger playing field. That was the single biggest
blast I could have dreamed of to help 'Circulate' the message. It's all about
circulation. Steve Forbes and all other speakers are to qualify and circulate.
Then fast forward to today and all the blogs. More and more soldiers spreading
the word and gospel of domain investing. How could you not love it? I do. I love
it and it gives me great satisfaction as it has become so manistream and
circulation is going strong and the first question I asked has already been
answered. How to circulate domain names to 6 billion people? I think I can
safely say I see the stuff in the garbage can and that signals success. Look
where you like, I find my success in the trash
Have a GREAT day!

You can boil it all down to one single word…….

Morning folks!!

When you look at where we are economically you can boil it all down to one
single word. One single pointed word. The hardest thing I have ever had to try
and figure out is this economy or lack of one right now. But after a lot of
consideration last summer I figured it out. The lynch pin in all this. The
word......Confidence. There is no confidence in the housing markets. There is
no confidence in the banking system. There is no confidence in lending. There is
no confidence on Wall Street. There is no confidence in the CEO's that are
raping their companies for personal gain. There is no confidence in the
automobile industry. There is no confidence in our government to solve the
problem. There is no confidence in the people that hold positions of trust. So
they can throw trillions at the problem but if confidence is not restored it
will be for nothing. There is not enough money in the universe to cover the
deposits in the banks. The only thing between us and the abyss is confidence. We
should be thankful that most of us are kind of passive. But if the truth be
known I would expect things could quickly unravel.

During the summer I said nothing as I withdrew my money from Wachovia. How
could I say out loud what I thought was about to happen? So day after day I quietly ran
around opening up new bank accounts. That was when I was worried about just one
bank. That was when I still had confidence in the banking system now it was just
picking which ones would collapse. Washington Mutual was an easy one to pick and
that could be said out loud. But Wachovia??? The bank I chose to do business
with for the last 20 years? The one with all my business and personal accounts?
The one people would know I lost my mind if I said out loud? Yup that one. So
for an entire week I ran around opening accounts at every bank I could find plus
some Internet based banks. After that waste of good time they finally raised the
insurance from $100k to $250k and also announced there was not enough money in
the FDIC to pay the claims should there be a massive default. That took my
confidence and lowered it by a few points.

So here we are. First National Mattress is open for business. Confidence in
the banking system is going to get worse before it gets better. Nobody can
predict how things can manifest themselves in crisis. So far, calm is still the
norm. That could change on a dime. We are vulnerable not because of anything we
have done wrong. We are vulnerable because there is no confidence nor should
there be.

Oh, did I mention the #1 reason for lack of confidence and why nothing can
work? Until the crooks are removed it is like trying to make a boat run faster
without addressing any of the holes and leaks where all the water is coming in and
preventing it from going any faster! These crooks need to be removed and paraded
in handcuffs. The perp walk in front of the world. The corruption and abuse is
the single biggest factor and one I have yet to see addressed whatsoever. Oh
yeah, they got Martha Stewart. Save the day!

Let me cut to the chase. I have no confidence that they can restore
confidence before the confidence crumbles. That may be the only thing I am
confident of. You can't put a happy face on this. Each day I wake up and the set
of circumstances and confidence level is a little lower than the day before.
There have been several pops and false starts and there may be several more. But
until confidence returns, and you need a REASON for that to happen, we are still
headed into the dark. Add to that we have yet to see the fallout and manifestation of all the layoffs and store closings of the last 90 days. That tsunami is heading to a town near you in the months to come. It is going to change the look of every Main St. and Mall in the country.

If governments make a bad decision with the policies they are debating
they can make things much worse. They can put us all in jeopardy. Especially if
those making decisions are corrupt themselves. Like the U.S. Congress for example.
I have no confidence in them because if you or I did what half of them did we
would be in jail. The ones trusted to solve the problem are the same corrupt public servants that
got us into this mess and then folks are supposed to have confidence? Sorry,
my confidence level is running on fumes and I doubt I am alone. This economic plane is out of control. The only guy I trust right now is 'Sully' Sullenberger. Let's put him in charge. I am confident that he alone could do the job of restoring confidence.

Have a GREAT day!

Rick Schwartz