Picking holes on a 'Wise' advice from a Financial Consultant

I promised yesterday to post a mail that is going around as forwarded from a Financial Consultant in Dubai, who has conveniently remained incognito. His suggestions are in italics and my comments in capital letters.

As forwarded by a financial consultant, in Dubai. Recession is coming... make your own judgment, don't panic! Do what is wise.

The recession looks very eminent. It is really time to take pro active steps to avoid a painful time in the next two years which is how long the recession is expected to last.

WE HAVE GONE THROUGH RECESSIONS BEFORE. SO THIS IS NOTHING NEW AND NOTHING TO BE PANICKED ABOUT. THE TRICK WITH RECESSION IS NOT TO PANIC. INDIAN ECONOMY IS NOT THAT AFFECTED AND IS EXPECTED TO BOUNCE BACK IN LESS THAN A YEAR. DEVELOPED ECONOMIES WILL TAKE ABOUT 18 -24 MONTHS.

Suggestions:
1. Don't take any loans; buy homes, properties with loans, or even cash. Keep as much cash as possible.
WHY CASH? KEEPING CASH IN THE LOCKER DOESNT MAKE IT GROW. YOU NEED TO MAKE YOUR MONEY WORK. INVEST JUDICIOUSLY. AVOID HIGH RISK, HIGH RETURN INVESTMENTS. BUT DONT KEEP IT AS CASH.

2. Pay off as much of personal loans, private loans, as debt collection will be hastened.
AGAIN WHY? THESE LOANS WERE TAKEN WHEN INTEREST RATES WERE LOWER. YOU HAVE SIGNED A LONG TERM AGREEMENT WITH THE FIN.INSTITUTION. THEY CANT DO ANYTHING ABOUT IT EVEN IF THEY WANT. SO KEEP PAYING YOUR EMI AS USUAL. DO NOT FORECLOSE THE LOAN AT ALL.

3. Sell any stocks you can even at lower prices.
STOCKS ARE AT THE LOWEST. THIS IS THE TIME TO BUY SOME GOOD BLUE CHIP SHARES AS THEIR SHARE VALUE IS CURRENTLY HIGHLY DISCOUNTED. BUY COMPANYS SHARES WITH GOOD TRACK RECORD

4. Take money off from Trust Funds.
TO SOME EXTEND YES AS THESE FUNDS HAVE NOT PROVEN TO BE WISE IN INVESTMENTS

5. Don't believe in huge sales forecast from customers, be extremely prudent, lowest inventories, reduce liabilities.
BUT WHAT IF THE CUSTOMERS FORECAST WAS CORRECT. HE WILL NEVER FORGIVE YOU FOR LETTING HIM DOWN IN NEED. USE YOUR JUDGEMENT. ANYWAY IF YOU HAVE GOOD RELATIONSHIP WITH YOUR CUSTOMERS, YOU WILL KNOW HIS SITUATION OR RATHER YOU SHOULD.

6. Don't invest in new capital.
RIDICULOUS. ASSETS ARE PRICED LOW NOW. THIS IS THE TIME TO BUY ASSETS USING CAPITAL

7. If you are selling homes/ properties/ cars, do it now, when you can get good prices, they are going to fall.
YOU WONT GET GOOD PRICES NOW. DONT SELL.HOLD ON TO YOUR INVESTMENTS OR ELSE YOU WILL LOSE.

8. Don't invest in new business proposals.
AGAIN RIDICULOUS. THIS IS THE TIME TO PLAN FOR THE BOOM PERIOD. INVEST IN NEW BUSINESS THAT HAVE A LONG GESTATION

9. Cancel holiday plans using credi! t cards.
WHY? NO REASON AT ALL. IN FACT HOLIDAY PACKAGES ARE ATTRACTIVE NOW

10. Don't change jobs, as companies will retrench based on 'last in first out'.
THIS COULD BE TRUE. BUT WHAT IF COMPANIES SACK YOU FIRST?

SO ALL IN ALL THIS IS A TRUE PESSIMISTIC OUTLOOK GIVEN BY A HALF BAKED, HALF ASSED FINANCIAL NINCOMPOOP WHO DOESNT KNOW ANYTHING ABOUT BUSINESS CYCLES OR MACRO ECONOMICS. IT IS GUYS LIKE HIM WHO HAVE BROUGHT DOWN THE FINANCIAL SYSTEM DUE TO LOUSY ADVICES LIKE THESE