Customer Reviews

Surviving the Coming Mutual Fund Crisis: How You Can Take Defensive Measures to Protect Your Money

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This is a book that should be read by anyone that considers themselves to be PRUDENT investors. When people say they are LONG-TERM investors, do they really know what they are saying? What do they mean? Do they realize that a dollar invested today may be worth 1.25 in 6 months -(due to the mania of this market) - but only worth 50 cents in 5 or 10 years? It could likely be worse than that. These mutual funds are being run by young hot shots that have no concept of doing anything but putting "money to work" (buying) due to the massive influx of money pouring in over the years. All reasonable valuation models have been trashed and "investors" have become extremely complacent because it's been so easy to "make" money. Sorry, it's not that easy or realistic! The selling will soon come in waves. Be wise and prepare youself for what will go down in history as the worst bear market ever, followed by a worldwide depression. Best of luck to all! P.S. I also recommend a book called "THE WARNING" by Joseph Granville and "THE GREAT CRASH of 1929" by John Galbraith. The parallels between then and now are too striking to ignore. So don't be one of the mindless herd.................

Just as speculators were lured into joint stock companies centuries ago (e.g., Tulipomania, South Sea Bubble), and investors of all kinds were seduced by unrealistic promises of stock pools and investment trusts of the 1920s and the "Go-Go Mutual Fund Mania" of the 1960s, so too are today's savers-turned-speculators being led down a path toward financial tragedy by the "New Era", "buy-and-hold" mania that has gripped the public's imagination for the past seven years. Christensen warns investors of the pitfalls and potential disaster that awaits anyone who thinks that mutual funds are a good way to diversify against risk. Mutual funds use derivatives, borrow from one another, engage in margin speculation, and are increasingly less shareholder friendly as massive inflows of money from uninformed savers breed arrogance and abandonment of risk aversion by mostly inexperienced, starry-eyed portfolio managers under 35 years of age. When the public discovers stocks and other financial assets, the risk becomes extreme and the party is almost over. Don't be one of those caught blaming the portfolio manager, the government, or Wall Street, when the blood starts flowing and you lose your life savings in a matter of a year or two.

I can't understand why this book is listed out of print. Why aren't more people demanding this book? Maybe there aren't enough investors yet who are worried about the safety of their money.

Just recently (Sept 99) a few money market funds ran into a bit of trouble - exactly the kind of trouble described in this book. Are you still assuming that your money market fund is safe and that a fixed NAV of $1 will be maintained?

The book definitely opened up my eyes to other alternatives for places to put money. Because of this book I've rediscovered alternatives like Treasury Bills and savings bonds.

However I did question the author's suggestions for a self-directed portfolio containing municipal bonds and widely held stocks. After the Orange County, California fiasco I would not consider municipal bonds. And I would question the idea of holding the same widely-held stocks that the institutional investors hold.

The author presents various scenarios that are supported by past events. Timelines, degree and origin of crisis miss the bullseye, but not the target. The author does mention CMO's, which sound like the CDO debacle now unfolding due to subprime loans packaged within these securities.
Extremely enlightening. An excellent bargain for .01 cent. It's the ultimate "contrarian" purchase for a personal finance book.

The book presents a very thorough analysis of the stock, bond, and mutual funds market mania. Historical precedents are sagaciously compared to current trends. Though written in '93, perhaps 5 years too early, the arguments are reasonable and terrifying. Don't panic, but do reduce your risks. Read the book, and buy your own stocks and bonds. Don't give your money to possibly unscrupulous and likely risky funds. Summary: the more people and more money in the markets, the more likely a crisis. Funds are no longer as careful or as closely regulated as they were, and fund managers are too desparate to find new places to spread their money.

This book shows a breadth of knowledge and depth of investigation that is rarely offered to the investing public. The fact that the book ends with a chapter on Further Reading indicates that the author respects the intelligence of his readers and is interested in what he is writing. A book of this quality shows by example how much junk is out there, yet the author is modest and always seeks to help the reader, not exhort. I read it after the onset of the two year bear market and in some ways, not all of the predictions have been met yet, making this book still worth your reading. The persistent heavy volume of trading in the QQQs and the recent snap back rally (5/2002)suggest that the public is seeking further punishment and the crisis is not yet matured. I hope the author rewrites it with the current changes in the market in mind: iShares, ETFs, gold and the rediscovery of the emerging market (only a rediscovery to the amnesiac). His style is intelligent and refreshing. You'll need to read it carefully, since some ideas only appear fully developed in a single passage. I couldn't put it down.