AU, AG, or paper

Bobk

So about six months ago I removed all my investment that was in a mutual fund and moved it to a money market. Early this week I withdrew about 95% of it and paid off my

mortgage. So now I will have a quite a bit more cash left over at the end of the month. So.... Reinvest in the DOW now that it is at 8000, or purchase PMs on a month by month

basis. Any suggestions. Bob

rgCoinGuy

Both, but I would still hold off on Stocks until a bottom is found. Diversify and dollar cost average. Most "experts" say 10-20% in PM's is about right, right now cash and PM is where I would be holding until the stock market finds a bottom though.

edited to add: JMO, but I am living by these words at the moment, I have a long way til retirement too though.

mhammerman

Interesting question, given our current situation. There are some real investment gurus here so this is a good place to raise your question.

Why do anything right now. The markets are in chaos. The talking heads say not to pull your money from the market right now and the mantra that stocks have been a great investment over time...I think they all have read the same book and that's the only one they read and they used Cliff's notes for it. But on the other hand, since most have already probably lost 40% of their money listening to the talking heads repeat "Pleazzzzzzzzeeee don't take your money out of the stock market" drivel over the past 9 months that what's to worry if you lose the rest. Repeat after me: Cash is King

Also, don't seek investment advice here, wrong venue.

secondrepublic

<< <i> Early this week I withdrew about 95% of it and paid off my mortgage. >>



Smart move. I assume no mortgage means no debt of any kind? If so, no debt means you can sleep pretty well at night.

If I had no debts whatsoever (I still have my mortgage, as well as the mortgage on a rental property), AND I had some money that I could afford to lose, I would put it in the stock market. The market is so far down that you're able to buy some very good stocks on deep discount.

Just my 2 cents.

Bobk

Hold off till stocks bottom. I belive its pretty close . Maybe 7000. But ya never know

Dont seek investment advice here. It was reading between the lines on the PM threads that pushed me to remove my stand on mutuals and put it into a money market. Belive me when it comes to my money I dont do anything without research from different points of view.

No debt whatso ever. Bob

fc

i guess it depends on how old you are and your timeline to retirement.
hard to give advice without basic knowledge of your situation.

if you are 38.. the stock market is looking better and better.

if you are 59.. the advice will be rather different.

Bobk

I'll be sixtytwo. Bob

ajbauman

Well I can't really give you advice on your situation, not knowing your age or "pain tollerence", but I can tell you I'm doing.

I have recently purchased MYY, SH, & PSQ (ETF shorts on the major indexes) and I am also building my position in PMs, but I have about 30 years until retirement time (unless my early retirement plans pay off). My goal is to make some money on the downside and purchase some more stocks once the bottom is found. If you are looking for long-term holds, stocks like GE and the like are currently at 50% discount.

Hope thats somewhat helpful.

Deadhorse

IMO, the stock market is nowhere near the bottom.

Not even close yet.

I do expect it to level off at some point and bring in some more foolish $$.

Then it will really crash, below 5,000 at the least, maybe worse.

Juat my outlook based on years of study, but I wouldn't touch the market for a few years yet.

ProofCollection

IMO, if you can time the bottom stocks are a great place to go; however, I do not have confidence in my ability to identify the bottom until after it is done.

Diversification is always best. I think right now is a time to hold cash and wait for the best opportunities - do not be rushed - bargains will be plentiful.

Diversification doesn't mean different types of mutual funds.... it's real estate, PM's, stocks, business interests or other assets, etc.

One thing I would have done differently - I wouldn't have paid off the mortgage. I've got a 30 year at 5.25%, which is cheap money... Cheap money that will be hard to come by soon (if not already). I would have preserved my cash to take advantage of opportunities. Plus, it's inevitable that interest rates will rise and we'll soon dream of the days when money was only 5 and 6%. Imagine saving your cash, and in a few years the savings account interest rate being higher than your mortgage rate! I think we will see that scenario in the next 5 years or so.

roadrunner

If GE has a strong exposure to illiquid derivatives, there's a good reason why it's stock is 50% off. Same reason for the auto companies that moved into the finance business and "funded" it with derivatives. Weren't Lehman and Bear Stearns bargains when they had fallen 50%? Truth is, these big banks won't lend to each other because they have no idea what their off balance sheet, over-the-counter derivatives exposure is. And until that's out in the open or the risk "nationalized," there's not much chance of lending occurring.

Actually each of them has a good idea what those off balance sheet risks look like.....all are distinctly underwater to the point of bankrupting the firm should they ever be forced out into the open. Every one of those banks could not pass a balance sheet muster.

roadrunner

Deadhorse

GE also trades with Iran, which is a violation of US law.

They are responsible for the IEDs which have killed or mained most US soldiers in Iraq.

Jeffrey Imelt has a lot to answer for, not only now, but at some level after he passes on.

Karma can be a b*tch, but first he should spend the rest of his life in prison if there is any justice at all.

GE is much closer to bankruptcy than is publicly known.

MoneyLA

why choose? why not diversify on a monthly basis?

moonshine

when everyone said metals and cash ... what kind of cash do they mean?

the actual physical paper money with president's on it; money market, CD's, regular savings account?

which is best?

Bobk

Thanks for the unput guys. It is always appreciated.

You know its a bad day in Flat Rock when your best day for the week was -128.

Deadhorse, you belive 5K or less on the DOW. That will damn near devastate alot of older people near retirement. Thats one way to get us

to work longer.

I see today that PMs are struggling. That surprised me a little.

57loaded

there was a big sell-off by hedge fund companies and such i think....almost the only thing "green" last week was gold and something profitable had to be sold to cover.

also i bought some gold yesterday (physical) for the first time in a few months so i guess i broke the "chain letter"...lol

most of us are all worried about out retirement future, mine, too. this market affects us all. yet if you can "not worry about tomorrow" and have taken the yoke of debt off your shoulders you are really already there...IMHO.

i'd sit on the sidelines till the market fully unloaded, then back into some tech stocks. congrats on your ability to take a yoke of debt off!!

Deadhorse........GE's Jeffrey? if that is true, ....High Treason maybe??

roadrunner

PM's will continue to struggle as funds or investors are forced out of them to pay off other bills or margin calls. But at the same time there is a lot of new blood entering the metals. And as always the PPT "has to" keep propping the dollar and bashing paper gold stocks frequently enough to convince most of the sheeple that paper is the safe play, not precious metals. European banks/brokers are turning people away due to heavy demand for gold. Don't think for a minute that the powers behind this play aren't stocking up on physical gold and cheap gold shares. They want to be in the right place when the lid finally blows.

roadrunner

ProofCollection

<< <i>when everyone said metals and cash ... what kind of cash do they mean?

the actual physical paper money with president's on it; money market, CD's, regular savings account?

which is best? >>



I would say a savings account or short term CD at a bank you can trust. I think ING is pretty safe (someone please tell me if there is a reason to suspect something with them) and S&L's or credit unions might also be fairly safe.

jmski52

when everyone said metals and cash ... what kind of cash do they mean?

the actual physical paper money with president's on it; money market, CD's, regular savings account?

which is best?

Dead presidents cash is cash. So are T-Bills. That's about it, although I do have an account in a T-Bill fund at T.Rowe Price. Vanguard has the same type of account. They are restricted to holding T-Bills and nothing else.

Money market funds have come under fire for holding derivatives. CDs are dependent upon the integrity of the issuing banks. A regular savings account is insured by FDIC, so presumably it's still ok.

fishcooker

I think it depends on the dollar amount and your overall financial and healthcare situations. After opening today's mail, I think it's safe to say the healthcare sector hasn't experienced Deflation.

As you probably already know, dollar-cost-averaging is beneficial in a trading-range market, as opposed to bull or bear. I think we're as far from a trading range as you can get.

Absent more details, I think I would wait and re-evaluate after the presidential election... and the ramifications thereof.

Bobk

MMMMMM. I quess deciding to do nothing at the moment is something.

I'm going to St.Charles this friday. Perhaps I'll have a revelation

Thanks guys. Bob