RespireRx Pharmaceuticals Inc (RSPI)

[gfp927z]

OT - Boy, the overall market turned on a dime today, after being up huge in the morning. A couple of things that keep gnawing at me are -

1) Dollar Crisis - The possibility that a steadily weakening dollar may eventually prompt Fed tightening to prop up the currency, regardless of the state of the economy. US budget and trade deficits have been massive year after year, steadily weakening the dollar. Higher interest rates could eventually be the only way to prevent foreign holders of US stocks and bonds from bailing out and heading to Euro based investments. But interest rates high enough to prop up the dollar would also put the US economy into recession. There also seems to be a growing consensus on Wall Street that Fed chairman "Helicoptor" Ben Bernanke may not be tough enough on inflation, and hasn't tightened credit enough. Critics also say Bernanke is an academic with little real world experience.

2) Real Estate Reversal - Fallout from the bursting of the real estate bubble could help take down the US economy. Residential real estate activity was one of the primary drivers of the recovery from the last recession, not only on the construction end, but also by giving homeowners more cash to spend. That's been thrown into reverse.

3) US Stock Market - The US market has been up for 4 years in a row.

4) Iran - The Bush administration now faces the decision on whether to - 1) bomb Iranian nuclear sites now, 2) let the next administration do it, or 3) possibly let Israel do it. If Bush wants to do it now, he'll likely have to do it in H1-07, since 2008 is an election year and the primary season starts in earnest by early '08. The US is currently moving a second carrier force into the Persian Gulf.

Anyway, I guess there's always something to worry about. But I figure that investing for the longer haul with a monthly dollar cost averaging approach will help smooth out the inevitable bumps in the road. FWIW, I also figure a 20% allocation into international markets is prudent, not only as a dollar hedge but also for the added investment opportunities.