Sunday, November 30, 2008

Ideas on preparing for the worst...

while still hoping for the best!
I got a myriad of responses, keep them coming! And, thanks to all who have so far taken the time to respond with some ideas. Quite a few people are pointing the Gold. And, quite a few point to Peter Shiff. Just want to remind you that Peter Shiff recommended you protect yourself by buying European stocks as a safe haven, if you'd have listened to him youd be down well over 60%! 'Nuff said!
FYI - I'm up oh, some 1000% or maybe it's 2000%. No biggie, hehe!
I'd rather trade then invest in anything. What I'm trying to do is diversify and hedge against a dollar devaluation, which I think is inevitable. BUT, the problem here is that right now, and potentially for a while, we have DEFLATION. You can't make money with Gold in a deflationary period more than likely. I own some Gold, I may buy maybe 60 to 100 more ounces just to have some, but ultimately I don't trust gold and it's something gold bugs always think is going to go to $10,000. On a chart basis it looks like it has a better shot at $400 again then it does at the $2000 for some reason everyone seems to think it'll get to. Also, remember, I recommended Gold at $275 and bought a bunch for myself there, and sold most of mine at $1000. I can rebuy some and still be ahead of the game all around, I just don't think its a safe haven and I'm only interested in pretty sure things. Farm land is interesting, if I didn't live in NYC I would probably buy some. Living in NYC makes it hard for me to do that sort of thing and take care of it. Plus, if we get an extended deflationary period, which we may, then land prices will contract as well. I am pretty sure the government is going to lower mortgage rates to 4%. If they do I will buy some property as that would be worthwhile. The problem is that THAT will be when they devalue the dollar more than likely, so the $2 MIL house is really a $1 MIL house priced at $2 MIL, the dollar will be way lower then. And, frankly, this is the problem with this dilemma our powers that be have helped create, they have created a deinflation/inflation bubble at the same time. In the '70s we had for the first time Stagflation, well, they have outdone themselves this time and we have both de and in - flation butting heads. That's a tough situation to have safe haven's in. In deflationary times you'd want Cash. In inflationary times you'd want Gold or property. Now? You're kinda in never never land either way! Frankly, I think the best investment is just to short the markets long term and get huge returns if you do it right. I just cant see us higher a year from now. THings could change and as I've detailed I guess if they devalue money enough the DOW could go up since it would then really be going down, but would appear to be going up due to dollar devaluation.
BOttom line is, all ideas have merit, or at least most do, but nothing strikes me as a sure thing. And, I feel I am a pretty sure thing to make money trading, so I don't want to invest in things that are iffy. To me, and I know many of you disagree, Gold is iffy. I'll have some, but last thing I want is something that even if it does go up, which it very well may, it's unlikely to counter the devaluation in a meaningful manner.

Keep the thoughts coming!!! And, remember to sign up for the WORLDSERIESOFTRADING.COM to win $2500 in cash and prizes each week! THat's one way to stay ahead of the curve! It's FREE, no purchase necessary!



1 comment:

Mike said...

Hi Waxie:

I live In Vancouver, Canada. I wonder why the World Series Of Trading is only available to US residents.