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8:00 AM EST, Tuesday, September 30, 2008: My friend's 87-year father calls from Australia yesterday. Should he take all his money out of the bank? He lived through Germany in the 1920s and the 1930s. Another friend signs a $6 million loan on real estate he's buying. It's at 65% loan to value. In the old days he could get 80%. Getting the loan -- any bank loan -- is cause for celebration, and amazement. Meantime, he bids $7 million on some Florida "distress" real estate. There were 15 bidders. The property will go for $9 million+. No great bargain. Oodles of cash are sloshing around looking for a profitable place to invest. There are almost no "distress" opportunities -- contrary to what you and I would think. Much cash has moved out of hedge funds into treasuries. Capital preservation at any cost is the name of the game.

Cramer apologized for having Bob Steel on his show two weeks ago. Steel told viewers everything was wonderful at Wachovia. I'm apologizing for Washington Mutual. Clearly my talented friend, Alan Fishman, couldn't and didn't save the company. There are two lessons here. For Cramer it was "there is no objective truth." For me, it remains the impossibility of predicting anything in today's ultra-scary, and ultra-fast moving world. This is black swan squared. Remember Taleb's book?

I moved the last monies out of my last bank account with over $100,000. I tried to take $90,000 out in cash yesterday since I didn't trust the bank getting the wire done in time. But the bank said it had run out of money and they could only give me $40,000 in twenties. I don't make this up. My hedge fund is 70% cash, 30% long and 18% short. He's down for the year. My friend is in a contrarian bear fund, which is up 330% this year already.

In the end, Paulson's plan failed because Paulson did a lousy job selling it.

He almost got it through with the urgent "emergency" railroading that Bush got the Iraq War through. This time was different. Never once did Paulson explain why his plan would benefit businessmen in middle America -- the ones who ultimately killed it by calling their Congresspeople and telling them not to vote for it.

I saw Paulson on CNBC this morning. He said, "We had a plan we worked very hard on."

Do I care about how hard he worked on his plan? What I care about is how my $700 billion spent by him will benefit me. And that's ultimately what killed it. The benefits to me simply weren't clear.

Steps we do need (call your Congressperson)

1. Up FDIC insurance to $1 million from $100,000 today. That might stop some of the runs on the banks. A run helped cause Wachovia to collapse. Business accounts are not adequately insured. See yesterday's column.

2. Do something about home owners in danger of losing their homes. Give foreclosed homeowners who stay in their homes a tax break. Form something called "The Home Ownership Corporation." Fund it with taxpayer money. Take on foreclosed houses.

3. Do something about education. Many kids can't get college loans. It's time for another GI Bill.

The S&P 500 is down 25% this year. The Dow fell 777 points yesterday.

Cash is King.

When in doubt, stay out.

Banks continue to fail. Yours might also. Do not have more than $100,000 in any one bank. See yesterday's column for information on BankRate.com, which rates banks.

People have stopped discretionary spending. This will seriously hurt "luxury" stocks.

Today is the first day of Rosh Hashanah, the Jewish New Year
On the morning of Rosh Hashanah as the congregation was filing in, Rabbi Feldman noticed little Jacob standing in the foyer of the synagogue staring up at a large plaque. It was covered with names with small American flags mounted on either side of it.

The six-year old asked, "`Rabbi Feldman, what is this?'

The good Rabbi tenderly put his arm around Jacob's shoulder and said, "Son, it's a memorial to all the young men and women who died in the service."

Soberly, they stood together, staring at the large plaque.

Finally, little Jacob, in a voice barely audible and trembling with fear asked: "Which service, Rosh Hashanah or Yom Kippur?'

Old Jewish stock market saying
Sell Rosh Hashanah. Buy Yom Kippur (ten days from now).

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.