By Barbara Eisner Bayer (TMF Venus)
February 1, 2000

HILLSBORO BEACH, FL (February 1, 2000) -- For investors accustomed to the pleasantries of a bull market, January 2000 has been an unpleasant month. The Nasdaq declined 3.17%, the S& P 500 fell 5.1%, and the Dow dropped 4.8%. (Remind me not to mention that this has been the worst January performance of the stock market since 1990.) This is especially disheartening considering that January is typically a strong month for stocks. Could this be an omen meaning trouble for stocks for the rest of the year?

In addition, the Federal Reserve's policy makers are widely expected to vote to raise short-term interest rates at the end of their two-day meeting that begins today. Will a rise in interest rates spark an even deeper bite into the happy pre-Y2K returns of investors?

As Fools, we expect there to be some rocky roads in our quest for green pastures for our long-term portfolios. Perhaps that time is upon us. Perhaps it isn't. No matter what, there are no good reasons to seek alternatives to our long-term buy-and-hold approach.

It would be great to design investing methods that could guarantee upward movement no matter what was happening in the world -- but it hasn't been invented yet.

As the optimistic Doris Day familiarly crooned:

"Que Sera, Sera
Whatever will be, will be
The future's not ours to see
Que Sera, Sera"

The more pessimistic an investor feels, the more apt s/he is to make rash decisions that s/he'll eventually regret. It would be a mistake to allow short-term pessimism to scare a Fool into moving money allocated to long-term portfolios into investments that aren't carefully thought through.

When you turn on the TV and are confronted by one of those "get-rich-quick" commercials, yield not to temptation. Especially if your returns are faltering and what you hear sounds like a harmless idea. Remember, there's a method to their madness.

First, they prey on the vulnerable -- and anyone who is losing money and confidence falls into that category. If you find yourself tempted by one of these moneymaking schemes, be conscious of the manipulation these folks use. You may be promised riches, but the only people getting rich on get-rich-quick schemes are the schemers who dream them up.

According to a paper entitled The Millionaire on the Beach: The Language of Get-Rich-Quick Plans by Randall Bytwerk and Quentin Schultze, schemers are taught the following techniques to lure you into the fold. They rarely tell you what you'll get for your money, most likely because you aren't getting much. Instead, they tell you what the plan isn't rather than what it is. A typical pitch would contain:

1) A confession that the person selling the plan was an uneducated failure.

OK, Fools. Here's some advice. If someone tells you he's an uneducated failure, believe him. This information comes right from the horse's mouth -- send him back to the stable. Then change the channel.

2) A picture of the promoter standing in front of an expensive car or an exquisite mansion.

No doubt acquired from the money he made duping innocent folks into believing his tales.

3) Testimonials from ordinary folk.

For the right price, anyone will say anything.

4) Claims of uniqueness and ease.

Doing nothing begets nothing. No wonder it's easy!

5) Criticisms of competing plans (some even say the author tried other schemes and failed -- until he hit upon The One that works).

A scheme is a scheme. There's no reason to believe ANY of them work.

6) A limited time offer.

Of course there's a limit. If not, you actually might have time to think it through and change your mind.

7) A money-back guarantee, sometimes even more than that if the customer is not satisfied. Buyers are often urged to postdate checks a month or more.

When push comes to shove, will you really get your money back?

Case in point -- Wade Cook, the former real-estate prophet and current stock market guru and chairman of the board of Wade Cook Financial, whose only business is marketing his books, cassettes, and Wall Street Workshops, in which you can enroll for the piddling sum of over $3,000. Attorneys general in California and Texas have filed charges against Mr. Cook, alleging that he violated refund policies for his seminars. In addition, the states charge that Wade Cook Financial's advertising is deceptive in that it touts an investing scheme that would likely cause people to lose money instead of making the returns he claims. Nine other states are considering filing consumer fraud charges against his company as well.

If the market's getting you down, don't fall victim to get-rich-quick schemes. Instead, remember Doris Day's perky smile and think long term. We can't control the market... we can only control the way we invest in it. As for predicting the future... Que Sera, Sera.

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