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9:00 AM EST, Tuesday, March 3, 2009. This is getting more serious by the day. What's "serious" is not the sharp and continuing drop in the stockmarket but the desperation in commercial real estate. I sat in on a conference call yesterday. An owner of big downtown office buildings reported to his dismayed investors that

1. His buildings have fallen 30% to 50% in value in the past several months, and were continuing to fall. The falls have wiped out their equity in the buildings, where were typically financed to 75%.

2. He had really no idea what the buildings were now worth, since there were no "comparables." They'd been no sales in recent months against which he could compare his buildings to.

3. Rents are falling. Tenants were leaving in droves. Many buildings are now cash negative. This means their rental income doesn't cover their expenses of upkeep and interest. The owner now is dumping his own money into the buildings. Either the lender renegotiates his loan or the borrower walks. The equity owners are, of course, wiped out.

4. Few companies are signing for new space for two reasons. First, they are concerned about their business prospects. Second, all believe that rents will fall even further.

5. Refinancing of loans coming due is hell -- since most lenders are like deer, stuck in the headlights of an oncoming car. Lehmann Brothers' bankruptcy hadn't helped since they were big in commercial real estate.

Don't believe me. Check out the IYR -- the iShares Dow Jones US Real Estate ETF:

What's not helping is that respected newsletters -- like the Dow Theory Letter written by Richard Russell -- are getting really gloomy:

March 2, 2009 -- "It is becoming clearer each week the life we have known has been changed forever. No longer can many afford to dine at fancy restaurants, buy designer clothes, make payments on a new Porsche or purchase a McMansion. We have enjoyed the longest period of leveraged prosperity in history."

"We came to believe our retirement would be financed by profits in the stock market. We took out home equity loans to pay for vacations. We sent the kids to college by strapping them with loans requiring years to pay back. We measured wealth by the limit on our credit cards. Now, the dream of perpetual prosperity has ended." - From old-timer Bill Gary who's been writing the terrific Price Perceptions commodity advisory for 41 years (800 231 0477).

I think about the market maybe 20 hours a day (I sleep the other four hours, but I guess I even dream about the markets). Anyway, here's something that I came up with that shocked me. Let's take the bottom of the Great Depression when the Dow collapsed in July 1932 to 41 (it's never been lower than that since). Then let's take the Dow high in October 2007 at 14164. What's the halfway level of the entire climb from Dow 41 to Dow 14164? That halfway level is 7082. OK, Well, last Friday the Dow closed at 7062, 20 points BELOW 7082, the halfway level of that prodigious climb.

What does this mean? This means that as of last Friday the Dow has given back slightly more than half of all its gains since the bottom of the Great Depression. Think of that -- it shows us what horrendous damage has been done to the market since 2007. No wonder Warren Buffet's Berkshire Hathaway has lost half its value, so far, in this brutal bear market! Now Buffett tells us that the US economy will be "in shambles" for the rest of 2009.

Here's something else. In yesterday's New York Times there's a whole page of opinions by leading analysts regarding where each analyst sees the ultimate bottom of this bear market. This is an exercise in futility. One of the biggest mistakes one can make in investing is placing a limit to where you think a bull or a bear market will end.

The bitter fact is that nobody, no brilliant analyst, has any idea of where this bear market will end. What if earnings and dividends collapse, and price/earnings sink below 6 (it's happened before)? Under those circumstances, the Dow could sink as low as 1000 or even lower. We know that bear markets, following great bull markets, tend to overrun themselves on the downside. Therefore, my own advice (to you and myself) is that we should have no preconceived notions as to where this bear market will end.

How bad can it get? I honestly don't know. A lot of seasoned investors are congratulating themselves on being smart enough to be largely in cash over the last year. But wait -- suppose the US dollar collapses along with most fiat money? In that case, nobody will want to hold Federal Reserve Notes. Nobody will want any fiat money backed by any country (remember, all fiat money must be backed by the country of issue).

There's too much of everything. From an email I received yesterday,

The entire golf course market is way overbuilt. There are approximately 300 golf courses for sale in the US. Of those 100 + are tied to housing development projects.

Chutzpah: Bernie Madoff says his wife should be allowed to keep nearly $70 million worth of assets held in her name, including the Manhattan penthouse where Mr. Madoff is under house arrest, because they are unrelated to his alleged fraud.

In addition to the $7 million penthouse on Manhattan's Upper East Side, Ruth Madoff holds some $45 million in municipal bonds at Cohmad Securities Corp., a brokerage firm partially owned by Bernard L. Madoff. She also holds $17 million at Wachovia Bank.

Getting stupider and stupider. GM owns Saab. GM is trying to sell Saab. Saab is broke and in the Swedish version of Chapter 11. Saab Managing Director Jan Ake Jonsson, says Saab needs 500 million euros (about $632 million ) in aid from the Swedish government to survive. Mr. Jonsson played down the possibility of tieing his company up with Sweden-based Volvo, which Ford Motor Co. is looking to sell. "There is too much overlap" between the brands, he said.

Meanwhile Toyota has shocked the industry by begging the Japanese government for money.

I don't make this stuff up.

The simplest, best GPS around: I love my Garmin Nuvi 350. But I always thought you had to run it with an attached power cord that dangled annoyingly. Wrong! The thing has an internal battery and will run for hours stuck on the windshield, like this...

and like this.

You can also carry it with you and use it to find your way while you're walking. Recomended. Refurbished for only $114 at Amazon or new for $302 from Amazon.

The new mile high club. I remember when it took 25 minutes to fax a single sheet. Now it's 2009 and I'm sitting on a plane and surfing the Internet at high speed. The service is provided by a new company called


At 35,000 feet, you turn on your laptop's wireless WiFi. It finds gogo. You turn on your browser, put $12.95 on your credit card and bingo you're receiving emails, checking your falling stock prices, shopping for things you can't afford, reading gloom and doom news on Bloomberg.com, or even this column.

I asked a stewardess what happens when passengers surf porn sites (YouPorn, RedTube, etc.).

She told me, "I tell them to shut off surfing pornographic sites on the plane."

And they reply? I asked.

They get angry, she said.

The Jewish Funeral
Morris died. His will provided $500,000 for an elaborate funeral.

As the last attendees left, Morris's wife Rose turned to her oldest friend Sadie and said, "Well, I'm sure Morris would be pleased."

"I'm sure you're right," replied Sadie, who leaned in close to her friend and lowered her voice to a whisper. "Tell me, how much did it really cost?"

"All of it," said Rose. "Five hundred thousand."

"No!" Sadie exclaimed. "I mean, it was very nice, but really... $500,000?"

Rose nodded. "The funeral was $6,500. I donated $500 to the synagogue for the Rabbi's services. The shiva food and drinks were another $500. The rest went for the memorial stone."

Sadie computed quickly. "$492,500 for a memorial stone? Oy vey, how big is it?"

"Five and a half carats."

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads on this site. Thus I cannot endorse, though some look interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Michael's business school tuition. Read more about Google AdSense, click here and here.