Learn Something From Bear Stearns!

Well, it was a crazy week on Wall Street this week. However, the biggest lesson of the week came on Monday when Bear Stearns was bought by JPMorgan (at the urging of the Fed) for $2 per share. Bear Stearns employees owned nearly 30% of the company's stock. While I am all for being a team player, you should keep as few assets invested in your employer as possible purely for diversification purposes. All your income depends on your employer, why would you want any more of your savings to depend on your employer than you have to according to company policy? The people at Enron learned the hard way. The people at Bear Stearns learned the hard way. It's a terrible thing that happend to all those people, but some good can come of it. If you own a bunch of your company's stock in your 401k or profit sharing plan are allowed to sell some of it and put it into something else do it. Not tomorrow. Not a week from now. Not a month from now. Diversify today! You never know what may lie ahead for your company. Bear Stearns thought they were fine just a couple of weeks ago.