William Franceschine

An interesting story I was sent by a reader, which I have fact checked by calling into the main Amsterdam Police Headquarters:

When you travel to Amsterdam in The Netherlands, you can legally pay for sex in the famed ‘Red Light District‘. However if you are ripped off by a prostitute, you have no recourse other than to sue her in civil court. You cannot complain to the owner of the building or the police. You can enter a room, agree on a price, hand her the money, and then have her flatly say to you ‘leave now, I am keeping your money’ and there is nothing that can be done-other than you taking her to civil court.

The person who sent me this was evidently also attacked while arguing with a girl there over her ripping him off, and he reported both the theft and the assault to police in Amsterdam-they would do nothing about either incident other than recommend he find legal counsel and sue the woman in court. What assets is a prostitute going to have to sue for exactly?

A terrible law in my view, and one paid little attention because – much like smoking, or porn – there are few advocates for consumers being abused-as most people are not proud of the fact that they are consumers-many probably wishing they were not.

At the opening I added AXP (American Express) to my portfolio. Together with BAC (Bank of America) and GE (General Electric) I think I have an amazing group of Blue Chip stocks that have:

a) been hit particularly hard by the current downturn
b) stand to return to record highs – once markets recover their sanity

-One day into my investment AXP is already up 18%.
-Three weeks in BAC (75% of my overall investment) is up over 120% – and gained over 20% today.
-Three weeks in GE is up over 50% and gained nearly 10% today.

Not a bad start. I don’t expect the gains to be as large and as quick forever, but I expect a steady upward slope for the next 2 years+ or until the stocks are back to record highs, whichever comes first.

“These are the days when many are discouraged. In the 93 years of my life, depressions have come and gone. Prosperity has always returned and will again.”

John D. Rockefeller, shortly after the Wall Street Crash of 1929.

The answer for how to respond to a situation like we are in now is preached in every credible investment book on the market – when there is blood on the streets, buy real estate – yet otherwise rational and intelligent people  are being caught up in the desperation and perception of hopelessness in the markets. Real Estate and Stock prices are plummeting, with the ’smart’ money staying out of the way.

But they are missing a fantastic opportunity. The stock of virtually every company in the United States is trading at a significant discount to what it was just six months ago. What has changed so drastically about America in that time? The answer…not much, if you focus on the long run.

The crazies are running around talking of the national debt, the US Dollar and the rise of China and India, but they fail to understand history and the way markets predictably boom and bust. The Stock market and Real Estate market will boom again. The people who buy near the bottom are the people who will get rich when markets inevitably correct themselves.

Personally I think we have already reached the bottom, and the gains of the last two weeks will mark the beginning of a long, slow climb back to record highs. I’m personally putting a big bet on the US economy and am building positions in several blue chip companies.

Hi, I’m William. I’m a perpetual traveler and world citizen, orginally from Northern California, USA. I have been travelling the world, with a bit of work sprinkled on top, since 2005 – and I don’t plan to stop anytime soon. On this blog I will post pictures and trip reports from my travels as well as some of my thoughts on business, politics and life in general.

You can reach me through the comments section of this blog.

-William