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Like everybody else, I’ve spent a lot of time trying to understand what’s happening with the economy. Over the next few posts I am planning to provide some insights I received from my financial planner Jay Bigman.

According to Bigman the trouble started in 1998 when congress told Fannie Mae that they would have to take sub-prime, non-conforming loans into their portfolio. The idea was to make it possible for more Americans to get loans and buy homes. This much is pretty familiar. The problem was and is that investors, not just homeowners, saw this as an opportunity to buy up properties with little or no money down. Then in 1999 the Glass Steagall act was repealed. This was not a good idea because now banks, insurance companies and brokers could get involved with each others’ business. Now before you conclude this is the standard right-wing line that tries to blame the whole thing on the Clinton Administration, continue reading.

After the repeal of Glass Seagall the huge financial services companies like AIG, Citi, Lehman, Bear Stearns and Goldman Sachs could each do what the other was doing and this created more competition and the need for riskier investments to continue making big profits. But there is much more to the story which I will explain in the next post.

I’ve been struck in the last few days by the imbalances in the our economy. Now when people can buy a beautiful retirement house for a song, they don’t have any extra money. The deals on cars are getting better every day and more recently I’ve heard vacation package rates are falling like December snow. I keep thinking about how I can come up with enough money to buy a vacation house in Florida or Puerto Rico, because I know in a few years they’ll be out of reach again.

The good news is, some areas of the economy are very healthy, like healthcare for example. I don’t mean insurance. I mean nurses, lab techs and hospital staff. Accountants and financial analysts are also seeing boom times. And believe it or not, education is booming because in a recession, folks feel the need to retrain. But what if you don’t want to be a nurse and don’t have the time to learn accounting or finance? What about something practical, like becoming a plumber? I haven’t taken the course myself, but John White’s Guide To Passing The Plumbing Exam promises you will pass the license exam if you download and study his course. You can also buy the book, but it’s more expensive and you have to wait for shipping.

If you download the e-book on your computer, you can have it immediately and can start training for your new career. Personally, I think it could be a good move, because more people are having to keep their homes. If they want a change, they will have to remodel. That creates a big demand for plumbers in repair as well as remodeling.

In future posts we’ll look at other practical jobs for the new, smaller economy, so stay tuned.

On Saturday, I talked about the need to develop a positive attitude about the economy regardless of the stories you hear on the news. Today is a great example of what can happen if people get a glimpse of what is possible for this country. During the campaign Obama demonstrated he was a master salesman with his message of hope. It got him the Presidency. Today, he began selling America on the idea of a renewed economy, an economy that we can all be a part of. The result? A jump of almost 300 points on the Dow and over 60 on the nasdaq.

It’s not a hard sell because the US is in touch with its pain and Obama is offering the cure. That’s what a good salesman does. He speaks to the pain of his customer. The outgoing administration can try to sell all it wants, but people have seen it can’t deliver. That’s not to say Bush can’t do some things to help out, but he has lost his audience and therefore the sale.

There are plenty of jobs that don’t have “sales” in the title, but the truth is, everyone is selling pretty much all the time. By selling I also mean convincing people to believe what you believe. And in most jobs, being able to get your ideas across is critical even if you don’t have a product or service to offer. If you’re a sales professional you know what I’m talking about. And as business owner for over twenty years, I find myself selling to clients every day. That’s why in this economy I think it is more important than ever to sharpen your skills. Bob Firestone’s Sales Comebacks and Rebuttals is a quick and easy way to put yourself in the driver’s seat. And if you are a sales professional or are thinking of becoming one you will not regret downloading his e-book and other coaching materials. And if you don’t like it, just ask for a refund.

The stock market will still be choppy for a while, but when people try to convince me that the sky is falling, I’m glad I have some effective comebacks. We are in this thing together and like Bogart once told a companion in a lifeboat, there is no room for cry babies.

The economic downturn does not have to be as bad as people seem to think. When I say this to people they usually object by pointing out the rising unemployment and the foreclosures and similar evidence. I don’t want to ignore these issues, but they tend to overlook the importance of attitude and belief systems. You may not be able to put attitude in the bank, but your chances of having money are much greater if you have a positive view.

Now because people need facts to change their beliefs, here are a few things to consider: Money and value are created by agreement among groups of people. You only have to remember that in some cultures shells have been considered very valuable and used for money. Another example is the way the international community and World Bank have just decided to “forgive” the debt of certain countries. One moment there was a huge weight that crippled the nation and the next it vanished, just because people said so.

The same thing can happen now with this recession. The whole world is starting to suffer because there is a widely held story that we we are falling toward a depression. The world press reminds us daily so we don’t forget about it and continue to act like the sky is falling. In fact, I read an article in the New York Times the other day about the moral decadence that has caused our fall. So now we are supposed to pay for our sins? I don’t think so because this kind of thinking does not work. This is the kind of thinking that lead the League of Nations to impose reparations payments on Germany after World War I. To punish it? Well, we all know how well that worked.  Most people believe it helped cause World War II. And it was precisely the realization that as a group of nations we can cooperate to invent value, that allowed the Allies after World War II to quickly rebuild Germany and Japan. Where did that money come from? Let’s face it we are being asked to believe a story (financial doomsday) that is causing a lot of suffering and could cause much more if we don’t do our part to stop it.

What to do now? I recommend not listening to people who are spreading the idea that the sky is falling. I also believe that we can ask our political representatives to explore ways to get governments to cooperate and end this thing. But the biggest source perpetuating this madness is the press. We need to call them on their irresponsible part in causing everybody to suffer. I believe folks have already had enough, the media needs to start looking at ways to rebuild now.

I know from practical experience just how powerful changing my attitude can be. I’ve been an entrepreneur for over 20 years and I have had my up and down periods. What I’ve discovered in the last couple of years is that it is vital to find a way to keep yourself positive. It can be a challenge especially given the news. I recently discovered a very useful set of programs offered by Tom and Penelope Pauley. I am not sure how they can offer this whole library for $35, but that is the price. The multi-volume set, Get The Money contains the Pauley’s books plus seven other money guides and a newsletter. An awesome way to keep your mind and your actions focused on building wealth.