What a month or two. Awful. What's ahead? Better times.

Mood is dour for the whole market. What is causing this market collapse? Financials and fear. Since financials got themselves into this mess, it'd be nice if they could contain the contagion, but that hasn't happened due to sympathy selling and liquidity issues. So, equities have hit the fan.

But what about fear? What is there to fear that the market hasn't already priced? A depression? I keep reading plenty of articles on the enormous amounts of ARMs to reset this year. Just a guess, but many savvy homeowners use the ARM to get a better rate on a regular basis. We did several times, and saved money monthly.

The economy? Well, here's the deal, at least to me. If employment stays strong, then I don't see a worry. I do see house prices coming down to more realistic levels. I read where the historical mean price for a house is 2.8x the household income for a neighborhood. I don't know about you, but that forecasts significant price declines. Some have already occurred, but most are yet to occur. When they do......no worries, mate.

Stocks? There is so much value right now out there. I dare you to find an fairly-valued stock. Double-dog dare you. There aren't many. Every stock I see has quite low valuations. Bad news and recession is forecast. What do I like? Apple (AAPL), Leapfrog (LF), Goodrich (GR) and Polo Ralph Lauren (RL) are four good ones. I bought two more stocks/call options recently that I think have good prospects and low valuation. Arctic Cat (ACAT) makes snowmobiles and ATVs, products which people will pass on in a pinch. But to me, nearly the worst was priced when I bought some ACAT in the $7s. I see it back to $15 or $20 by the end of 2008. Wachovia (WB) is a financial (boo, hiss). Wachovia is also headquartered in Charlotte, NC, possibly helping to isolate it a bit from the Wall Street shenanigans. Wachovia's dividend hasn't been cut, and it pays ~7.5% at $33 share price. That's value. Also, Wachovia just awarded it's CEO and other senior VPs lots of options. Here's the kicker.....the options are way out-of-the-money. Talk about incentive to get the share price up......

Those six should do well if you buy now and sit out the rest of the year (or even into 2009).

Better times ahead.