It doesn’t matter if you think there will be massive inflation or deflation; both views are valid today. I would like a financial plan that protects regardless, is that possible??
I already own gold/silver (stocks and bullion) and some resource stocks. No credit card debt. But feel insecure with money invested in US or EU or emerging markets.. Where to put my nest egg???
I have saved my whole life and have never felt so insecure.
Thanks in advance
No, there are no guarantees unless you are a principal of Goldman Sachs. Are you a principal at Goldman Sachs? If so then you will have your investments covered by hundreds of millions of tax payers. If not then you lose.
As for deflation, do not be fooled. The US Government is telling a huge lie. Prices are rising, look at the cost of medical insurance, local taxes, etc. The price index measured “inflation” is a lie. The central banks across the world are creating money. ERGO the old standards of Gold, Oil and Copper will have the best chance at keeping their values.
"It doesn’t matter if you think there will be massive inflation or deflation; both views are valid today. "
so tomorrow will one view be shown to be wrong?? does anyone think there will be massive inflation or deflation? what would massive mean?
“As for deflation, do not be fooled. The US Government is telling a huge lie. Prices are rising,…”
well prices have been rising for nearly everything…i do remember that in 1991 around gulr war 1 that gasoline in my area went from a dollar plus a gallon down to about .85 cents a gallon in a few weeks time…it then went back up again.
have many prices for goods dropped once adjusted for inflation?? have the typoes of goods that make up the bulk of consumers purchases dropped once adjusted for inflation in manner to overcome the goods/services that havent dropped in price once adjusted for inflation??
The key question is inflation/deflation of what?? If you mean dollars, inflation is the only possible scenario. Demand for dollars cannot be increased except by a major war (i.e. if the US/Israel are stupid enough to bomb Iran). And the supply of dollars was doubled back in the end of '08, beginning of '09 and we have yet to feel the effects of that anywhere except in the housing market. If the market does fall for the “green shoots” theory, we can expect massive inflation as demand for dollars goes back down to baseline. Dollars can only get less valuable, not more.
However, consumer goods may become more valuable than production goods or many commodities (ag commodities excluded). That means that you might buy a bunch of gold and silver only to find a year or two later that it will purchase fewer bottles of water or cans of soup per ounce. This is a result of the business cycle and the destruction of capital brought on by massive government intervention in the economy (not just inflation, though inflation is one of the worst culprits). Capital goods become less valuable because production is less profitable. Production is less profitable because the entire economy is regressing, it is shifting down to more and more direct production and away from more roundabout production.
So, the answer is to buy commodities whose demand curves are pretty much inelastic. Oil and food are the two big ones right now. This is the advice of Jim Rogers, Marc Faber, Peter Schiff (to a lesser extent) and the other “Austrianish” investors. The safest things to hold right now are things that you can be 99% sure will not lose their value, even in a worst-case scenario (war, famine, population collapse, catastrophic breakdown of the international financial order, etc.) If you are more creative, you might think of buying some things like alcohol or cigarettes since these have a fairly high value density and will retain their street barter value in the above-mentioned worst-case scenarios. Marc Faber strongly advises moving as much of your assets out of the US as you can, particularly into assets which cannot be seized by the US government with retroactive tax laws (e.g. foreign real estate). Through GoldMoney.com*, you can move some of your assets into allocated, assayed gold storage in gold vaults at London, Zurich and elsewhere.
I don’t have any assets to protect right now, so my advice is abstract, please take it accordingly. If I did have assets to protect, I would be thinking more like a street-fighter than a stock broker. Right now is the time to play defense because no one knows what’s coming but we are all apprehensive that something big and likely unpleasant is going to happen in the near future. Remember the old quote, “When there’s blood in the streets… buy land.” There’s no blood in the streets, yet. I’d wait until the blood starts flowing to worry about growing your assets. For the time being, just concentrate on not losing what you have.
Clayton -
*I am not advocating this service, please do your own homework regarding its reliability
Yes, it is impossible to predict which event will occur- even a stock market boom is not out of the question- nobody knows.
Despite the impossibility of accurately, consistently predicting future economic events, I believe that it is still possible [and fairly easy] to protect your savings, regardless of whether inflation or deflation or something else entirely occurs, and without having to predict either scenario [or others imagined] .
If you click on my user name , it will take you to my profile which contains information in the first link ["Financial Safety Rule#1] that may interest you. If so, please private message me and we can discuss.
If not, I wish you good luck with your quest for a perhaps similar plan .
Regards, onebornfree.
" It doesn’t matter if you think there will be massive inflation or deflation; both views are valid today. I would like a financial plan that protects regardless, is that possible??"
“The key question is inflation/deflation of what?? If you mean dollars…”
unless by financial plan he means something other than using dollars in his financial plan.
here he says “But feel insecure with money invested…” so i am not sure wha this person means by money…he said he bought stocks.
it seems that the poster was referring to inflation or deflation of money…i dont know if they consider dollars money. is there a money out there to buy stocks with that hasnt been inflated??
No matter what happens to the price level, this doesn’t affect the number of ounces in a bar of gold…