It's truly terrific news that the recent fires in California are mostly behind us. I worry for all the people who have lost their homes in those fires. This isn't at all unlike a hurricane hitting Florida or the Gulf Coast. Disasters like these uproot entire neighborhoods. Some will rebuild. Some will leave and never return. None will ever be the same.

I can't help but wonder how many people's lives will be made even more complicated than they already are because they've lost all contact with their records. Think about it for a minute. How many accounts do you have? You have financial accounts, probably checking, maybe savings, a brokerage account. There's your 401(k), your IRA (maybe a couple of them). You probably have one or more nsurance policies, and a mortgage. Don't forget credit cards.

The list goes on and on. My personal stress level goes through the roof thinking how awful it would be to try to reconstruct all that information literally from ashes. I have three recommended ways to safeguard your personal information in the event of disaster

There was a time when I believed in clipping coupons and making the rounds to all the low price retail outlets. I'd watch the ads in the paper and keep track of the sales and promotions. I considered myself a smart shopper.

How many times have you heard a story told by a friend or neighbor or family member where he or she saved significantly on a purchase by driving all over town checking prices and negotiating between sales people? Did you ever get the impression there might have been a little obsession going on at the time? That used to be me, the obsessed shopper.

Somewhere along the line it dawned on me I was investing a lot of time in the process getting ready to buy and that time had real value. Once the value of my time entered into the equation, clipping coupons and driving to 3 different stores for groceries didn't make much sense any more.

When was the last time your weekend was a little bit too long?

Welcome to the end of another week. I for one am really happy Friday's finally here.

That was some nice drop in the market yesterday, wasn't it? Are you doing anything about it? I hope not. My hope is, you have your portfolio allocated according to your current station in life and that days like yesterday are not too different from any other day.

The market will go up and the market will go down. If you've spread your risk out over various security types then you should sit tight and not worry about down days like yesterday any more than you should worry about up days where you could have made more money but didn't.

Think about that for a minute. If you're well diversified, you're not only not exposed 100% to downturns like yesterday's sell off, you're also not able to take 100% advantage of the days when the bull rages. Whenever I talk to people, young people in particular, their biggest objection to asset allocation strategies is they feel like diversifying their portfolio is akin to watering it down.

Did you make money in stocks last month? It wasn't qute as easy in October compared to September. Average returns were down a bit from 2.3% in September to a -0.8% last month. Just think. It could have been a bit worse without yesterday's quarter point decrease in the Fed Funds rate. Overall the stock market was just about exactly as risky a place to be in October as it was in September. Volatility increased only slightly from September's 1.7% to 1.8% in October.

S&P500 Least Volatile
We had an interesting mix of stocks making up October's ten least volatile stocks in the S&P 500. Alltel let the pack of our least risky stocks to own in October. Alltel was fully 9 times less risky to own than the overall S&P500 index. The rest of the S&P500's top ten least risky stocks in October was dominated by stocks in the Consumer and Health related industries.

First off, Happy Halloween. Market futures are looking bright at this hour of the morning. Let's hope the Fed's policy statement at the end of the trading day keeps it that way for tomorrow.

Now, as for the real business of this article... Did you happen to see this Wall Street Journal article by Johathan Clements entitled When ETFs
Are Better Than Index Funds? My first thought on reading it through was that he'd gotten it right. On further inspection and reflection, I'm not so sure.

One of my mother's favorite sayings was that every cloud has a silver lining. I don't think she ever realized how true that can be in the investment game.

I was speaking to a man yesterday about some work I'm considering having done. He owns his own home remodeling business. Now that might sound a little more grand than the reality here. He's a carpenter. He owns a truck and a couple of trailers for his tools. His business employs as few as one person at a time, himself, to as many as 3 or 4 if the job is a big one.

I asked him how business was for him lately. He told me business had never been better. He's considering taking out a loan to expand his business. He thinks it's time to move away from doing the labor in the business and to become the manager of a larger operation. When I asked him why this plan, he told me business had never been better. He said demand for home remodeling work was higher than he'd ever seen it before.

Chalk this article up as just one person's opinion. I don't usually make predictions about coming events. Today's an exception. I think we're in for a real roller coaster ride this week in the stock market.

The Fed starts a two-day meeting on interest rates and the economy tomorrow. The meeting culminates in their policy statement Wednesday afternoon a little after 4pm eastern time. Many seem to think the Fed will drop interest rates another ¼ point, to 4.5 percent. I think the debate leading up to the actual announcement will shift market sentiment first one way and then the other.

It'll be an intense debate, too. Proponents of a cut say the problems in the housing market are leading us into recession. They point to falling home prices and the lack of credit as the principal reasons the Fed should loosen up and let more money flow into the economy. The rebuttal to that argument points to the most recent quarter's 3 point expansion in the US economy. Opponents of a rate cut argue that consumer spending and exports, which have recently been both high and on the increase, have been fueled by an already too cheap Dollar.

Last month I wrote about a buddy of mine who had invested in Microsoft stock many years ago. He'd seen the stock rise nicely and had several times his original investment locked up in his holdings. His problem, if you can find a way to sympathize with him, has been that Microsoft stock has basically done nothing for quite a long time.

I didn't give him any advice on his problem, other than to talk about opportunity cost. That is to say, your money that's sitting idle in Microsoft today earning little or nothing could be invested in some other stock with more upward momentum. The difference between the value of his Microsoft holdings some arbitrary time from now and some other investment at that time is the opportunity cost of not making the more attractive investment.

I just wanted to put out a friendly reminder that if you've been considering moving out of mutual funds and into exchange traded funds, now is the time to get moving. Between now and the end of next month is prime time to implement this strategy. Here is why, and also why you should at least stop investing in mutual funds for a while.

There aren't many hard and fast rules about who gets paid how much; but there are a few realities. For instance, in general, outside sales people earn more than inside sales people. And inside sales people generally earn more than tele-sales people. Do you know why that is?

It's simple: A worker's value is determined by his or her replaceability. Good outside sales people are harder to find than people who can wait for customers to come to them. People who know how to deal with customers are harder to find than people who can read a script into a telephone. The harder to find people have less replaceable talents, or skills.

Your replaceability is determined by how much rare or unique capability you bring to your work. This uniqueness is what determines how much you earn. If you can't be replaced because of your unique talents, then your customers have no choice but to pay more for you.