"You know what the news is-- in a minute, you're going to hear the rest of the story"- Paul Harvey

I happen to believe we are already in a recession. How deep and protracted the recession is will be determined by how long oil prices remain at these elevated levels.

The news is unfolding just as we said it would in 2005. We knew the housing market was a bubble. We knew consumers were mindlessly borrowing money that they couldn't pay back. And, as a result, here we are.

I worked for a five time national championship coach who told me to watch people very carefully. He said when you do, you'll quickly figure out that most people are selfish, egotistical, and full of crap.

As I watched people from 2003-2006 spending money like drunken sailors, I knew that his theory rang true.

The spending craze that allowed people to buy the Lexus, BMW, and Audi's they couldn't afford is coming home to roost. This led to purchases of expensive homes, as well as eating out at expensive restaurants.

Today, banks are taking losses on "big hat no cattle" consumers, and sex sellers such as Abercrombie & Fitch and Limited are also seeing profits declines.

Today, the super bright analysts at Goldman Sachs decided to downgrade selected financials near the bottom. I can't believe that any comments from an analyst is allowed to be aired after the con job they pulled on the tech stocks a few years ago.

In short, these guys worked for investment banking fees, and not for investors like you and I. If you take the advice of these conflict of interest clowns, remember you do so at your own risk.

Every research report issued since 2000 comes with a disclaimer. I think this is unnecessary, and should be replace with this symbol instead.

Technically speaking, it looks as if our downside target on the DJIA of 10,593 will be reached sometime this summer or early fall. At 11,300 we will up our asset allocations by another 5%.

As it currently stands we are invested accordingly;

70% Equities: (Normally 95%) Aggressive
60% Equities: (Normally 80%) Moderately Aggressive
50% Equities: (Normally 60%) Moderate
30% Equities: (Normally 40%) Moderately Conservative
10% Equities: (Normally 20%) Conservative

If the DJIA hits our downside target of 10,593 we will add another 5 % to our allocation. If the DJIA breaks below 10000, we will go to 100% invested.

Since you already know the financial news of the day, (Yahoo Finance or Bloomberg) I will not bore you by repeating it.

Let's get to the "Rest of the Story".

The Rest of the Story

I heard a couple of definitions yesterday that I would like to share with you;

A recession is when your neighbor is out of work. A depression is when you are out of work.

As it currently stands, the economy is dropping like a rock. High energy prices are forcing consumers to choose between paying for food and gasoline, or keeping up with their debt payments (credit cards, lines of credit, etc). For now, they are choosing food and gasoline.

If oil prices drop to a reasonable level ($75-$85/bbl), consumers will be in better shape financially to make payments on their other debt obligations. Will this happen? I believe it will.

Unfortunately my attitude toward what our great nation once was has changed. The string pullers now own and control our lawmakers. Our nations citizens are looked upon as revenue sources. If you haven't noticed whenever Wall Street refers to you and I they use the word "consumer", and not citizen. We can change that, but we won't.

Sometimes I feel like I'm talking to the wind, but here are a few observations.

Amazing things can happen when citizens take action. In Britain and France the government fears the people. In the U.S., citizens fear the government. Whenever the citizens of these two nations are upset they protest with nationwide strikes.

Imagine what would happen to oil prices in the U.S. if our citizens banded together, and didn't buy gas or show up to work for a week. Corporations are smart. They have rapidly taken this power to strike and protest away from Americans by shipping their jobs overseas. As a result, the unions are left powerless, and nationwide strikes are a thing of the past.

As jobs have disappeared, many Americans have adopted an "every man for himself" attitude. This attitude prohibits unity, so we are left with citizens who are powerless and fearful. As a result, our citizens are now easily controlled by the string pullers.

So, are you being controlled? You, betcha!

You do have some power, however. Since the politicians are owned by someone else forget about the power of your vote. Instead, vote with your pocketbook. Be industrious with your money. When you buy food, look to your local farmers. Quit buying Salvation Army looking clothes from Abercrombie and American Eagle. Look for alternative gym shoes to Nike who make thugs like Michael Vick rich.

Think about where you spend your money, and who the people are that you give your money too. If it cost you $40 to fill up your car a year ago, only buy $40 worth today.

In short, stop giving your money away. If you kids want something, tell them no, or tell them to get a job.