Thursday, March 31, 2011

Where to put money now?

Next time there's a bear market, I'm probably just going to keep things really simple and put what's left of my retirement all in an index fund. What to do in the meantime is the problem.

Nothing constructive has come to me, but here's a summary of my random ramblings:

The stock market has doubled in the last 3 years and is just coming down from an all-time high. Seems like a good time to get out, not a good time to get in.

Precious metals likewise would have been good three years ago, but are also at an all-time high.

Serious inflation is at some point inevitable unless we stop deficit spending, and there's absolutely no indication that we will.

That makes debt a good thing IF you have an income that will keep pace with inflation. I don't have that.

A devalued dollar will favor companies who export, and hurt those who import. Trying to find export stocks, though, makes you realize how little the US exports these days. Apple would have been a great one last year. The whole world wants iPhones and iPads. But their stock is way up, too - another boat I missed.

Long term, oil and food prices are going to increase dramatically now that there are over 7 billion people on the planet. I just can't quite figure out how to invest in energy and food, though. Farmland?

Real estate and mortgage rates are low, BUT the ruling elite need money, and property owners are their bitches any time they want to raise taxes.

My Budweiser buddy says buy booze stocks - when times are good, people drink. When times are bad, people drink.

My banker neighbor says "tangible goods" that are not easy to manufacture and won't become obsolete or spoil and are easy to store are good investments, but what exactly are those? Gold is the obvious answer, but as pointed out above, that ship has sailed.

What will people want in the future that they can't make, that won't rot or go out of date, and that can be compactly stored?


The Suburban Bushwacker said...

If i had any cash I'd be looking long and hard for those 'find' english shotguns - but only vintage Purdy and H&H. Rich guys wiil always want them (poor guys too) and they aint making them anymore.


Or there's that Facebook IPO

Jeff Olson ~ Artist/Blacksmith said...

Thoughtful post.

Oblio13 said...

I've thought about buying vintage Sako rifles, as I know them better than I do fine old shotguns. The problem with any firearms is that future sales are problematical. There's a big political push to "close the gunshow loophole", which is a disingenuous code-phrase for "outlaw private sales". It would be like not being allowed to sell your old car except through a dealer, and hence impossible to make a profit. Also, there's no doubt in my mind that when the anti's get their way with "assault weapons" they'll go after things like "sniper rifles", i.e., any bolt-action with an optical sight. Not even shotguns are safe. Whoever is in charge of the ATF gets to decide which "are not particularly suitable or readily adaptable for sporting purposes" (as if the Second Amendment was about duck hunting), and Obama's appointee is emphatically not on our side.

The Suburban Bushwacker said...

Here in Old Blighty we have some of the most restrictive firearms legislation anywhere, yet the top end of the market is still thriving.
A lad (20) who worked with us has left to take up an apprenticeship making second tier English doubles i.e the kind that 'only' cost £100k a pair. The company has him filing scrap for the first three months, that's a investment that only a company doing very well can afford to make. I worked the poor lad like a dog.

My inclination is that at some stage america will throw up a trade wall and rely on the internal market. In a situation like that your SAKO's will be like unobtainium.


Anonymous said...

Since food prices will increase buy the dry foods that will last you for years that you like. Beans, instant milk, oats, rice, or potato flakes. If you grind wheat to cook then buy a ton of wheat.

Some other options are hand tools, ammo (doesn't matter if you have the gun for it), and seeds for gardens. Seeds are the only thing in history that at times have surpassed the price of gold.

Speaking of gold, I'd rather have 500 ounces of silver before I had one ounce of gold ... just think about it a while.

Instead of buying one ounce of gold you could have all the garden seeds, hand tools, and supplies that you need to live over three years in the 1700's.

Since Oblio13 can forge for food it's all the better. Now if he can only stay away from knife attacks!

Oblio13 said...

SBW, you convinced me that I need more rifles. Now I need you to convince my wife.

The Suburban Bushwacker said...

I'll do you a swap