Ludicrous nutburger call

Wednesday, Jan 23 in Economy | Comments (13)

Question: Amanda's dad is reading a book and is convinced that the stock market is about to crash and wants to pull all his money out and buy gold overseas. She doesn't know enough to talk some sense into him. What can Dave say?

Dave Ramsey's advice: I'll be as nice as I can ... I think it's absolutely ludicrous! I have seen books like this come out every year since I could read. I've heard the end of the world predicted every year. Could the stock market crash? Yes, but there is no indication that he should say this. I CAN'T BELIEVE THIS! This author is a nutburger. The end of the world is not coming.

In order for the stock market to crash, companies like Microsoft, Ford, GM, Home Depot, GE, Whirlpool and all those other big companies have to close. Not decrease in business, but CLOSE! Can you honestly imagine all of those companies closing? Our stock market operates differently now than in 1929; there are many more safeguards now. Less than two months after 9/11, the market was back up to the level it was on September 10. The people who make these predictions are doomsayers.

I don't own any gold, nor am I buying gold. The returns are horrible and the volatility is all over the place. The stock market looks like a cake walk next to gold. I own mutual funds and paid for real estate, and I'm not moving a dime on the advice of this idiot author.

Hear Dave respond to a nutburger philosophy

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Dave Ramsey is CLUELESS! You NEED to do the research!!!

# Posted by Brandie | 1/29/08 9:30 AM

Dave Ramsey is not clueless. Doing research is definitely something we should all do and if you research this topic you will find that
Dave is right.

# Posted by Lynsey | 2/19/08 1:44 PM

gold how been increasing in value for ever. I only wish I had invested in gold 10 years ago. I think it will continue to climb slowly. who knows it might be 2500 an ounce in another 10 years.

# Posted by dylan | 3/1/08 8:40 AM

Compare the Dow with gold over the last 12 months
and tell me how things look. While I agree that
going exclusively gold is not a good idea, but to
totally ignore its performance isn't very smart.
The dollar is going to continue to be weak thinks
to the policies of Greenspan and now Bernanke. They
have turned the economy into a political hot potato
and have implemented horrible policy with regards
to interest rates to appease the media that gauge
the economy by the direction of the arrow on wall street
In doing this they have grown inflation and
weakened the dollar.

# Posted by matt | 3/14/08 11:22 AM

The sky is not falling, Chicken Little. :) The media at large thrives on speading anything they perceive to be bad news, because it helps them sell papers and achieve ratings. Have any of you noticed how often the word "doom", "disaster", and "meltdown" have been mentioned? Honestly, are all of you out there living in Maytag cartons? Of course not. The bottom line: This too shall pass. Don't succumb to fear. Stay in the markey, and have courage.

# Posted by Dan | 3/17/08 1:12 PM

If you have EVER listened to Dave, he's always quick to point out the fact that gold has averaged 4% per year since it's been traded. That's the same as inflation, on average, which means your money's not increasing at all.

Contrast that with the stock market, which has increased 12% on average EVERY YEAR since its inception.

Now who's more intelligent?

# Posted by Ben E. | 3/20/08 2:13 PM

Also, gold doesn't pay any dividends,
or capital gains.

# Posted by Danny | 3/24/08 12:54 PM

I agree that putting all your money in gold is foolish. Stocks will outperform Gold over the long haul every time. However, Having 10-20% of your portfolio in companies that tend to move up and down with commodities, sa. mining companies, can add good balance to your portfolio.

# Posted by Scott McLuvin | 4/7/08 8:24 AM

RE the caller's dad: The author of the book has an incentive to create a doomsday scenario: To get people to buy the book.

As for investing in gold:

The current price of gold has been going down in the last few weeks. This doesn't mean it won't go back up, but it may also mean that gold was overvalued. There have been numerous stories in the news about investors flocking to gold as a safe place or people selling their gold to cover their obligations (in fact I did this to the tune of 1600 dollars, a week before the gold price started going down)

When I read stories like that it means people are using a follow the herd mentality for investing. Remember what happened in other situations involving the same mentality?

Real estate? The dot-com bubble bursting?

Gold historically is a poor investment. The world is not ending. In fact, things have been even worse in the past than they are right now. Everyone just needs to calm down

# Posted by KItty | 4/8/08 5:07 PM

Dave Ramsey is clueless about economic matters. Hey Dave, stick to what you know best that is giving advice that should be completely obvious and common knowledge to anyone with half a brain cell. I love watching you making MILLIONS to push his product to people gullible enough to buy it. At 300.00 (for one of your programs packages) I would give the public common sense advice too. It is nothing more than a propagandist who has promoted his “Baby Step” ideas for people who have made stupid choices with their financial matters.

If you want some common sense advice on the economy Peter Schiff has one book out there and a second one on the way. His advice is sound as my account with EUROPAC and made great dividends during this mess. His book parallels what he preaches on TV and unlike Dave he puts a full record of what he has said on his website. He has nothing to hide and has been unbelievably correct in his predictions. Also, we are talking about two different kinds of people. The people who follow Dave Ramsey and are in debt, broke in financial turmoil and need help getting out of a rut. The ones who follow Peter Schiff are financially squared away and just trying to protect their investments. For all the Mini Dave Ramsies out there who basically regurgitate his nonsense advice I encourage you to read Peter Schiff’s book Crash Proof.

# Posted by Joe | 5/3/08 4:04 PM

Joe, it's nice to see that you have such strong opinions about Daves listeners. Stupid choices, Broke, in debt financial turmoil: If I had realized how messed up I was I probably would have stayed in bed today. Thank you sooo much for straightening me out. Now let me straighten you out, I've NEVER been broke or in financial turmoil. In fact my finances have always been in exceptionally good shape. Dave gives common sense advice that is sound and you're a jacka$$. Reasonable people read numerous authors and listen to numerous opinions and point of advice then we sift thru what doesn't make sense and find what wouks best for us. You're disregarding all but one person then unloading on us. Shut up and find another place for your judgments.

# Posted by Phil | 5/30/08 2:02 PM

Dave and Peter Schiff agree on one fundamental point: consumer credit makes no sense. As Peter Schiff points out, consumer debt is not an investment that produces an income stream, so the only way to repay it is with reduced consumption in the future. But what Peter Schiff is addressing are the CONSEQUENCES of living on credit for years, even decades, on end. For Dave, it forced him into bankruptcy. What does Dave think is going to happen to this country? We are "officially" $9.5 trillion in debt, and, using GAAP accounting, we are over $50 trillion in debt! As Peter Schiff points out, our GDP is 70% consumer spending, much of which has been paid for by home equity extractions and credit cards. But those taps have run dry. When our creditors realize we can't repay our debts and that the Fed is flooding the economy with money (thereby debasing the dollar), they are going to dump their dollars or buy up U.S. assets while our currency still has some purchasing power. Either way, inflation is going to get much worse than it already is, and people who are holding dollars are going to be "robbed" via the inflation tax. The dollar is headed for a colossal fall, and anyone saving them is going to end up paying the ultimate "stupid tax."

# Posted by Grant | 6/3/08 9:11 PM

I'd like to hear Dave's thoughts on this
now that it is almost 6 months later. Is he
standing firm, or recommending readjustments to
one's portfolios?

# Posted by Lisa | 7/4/08 7:20 PM

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