JIM ROGERS: The worst crash in our lifetime is coming
carew4me
Posts: 3,470 ✭✭✭✭
carew4me
Posts: 3,470 ✭✭✭✭
carew4me
Posts: 3,470 ✭✭✭✭
Comments
Does he sell gold?
Man's been around a long time and is probably among the smartest out there. I'm sure our resident optimists will chime in to disagree.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
One thing we should all agree on... sooner or later, a major crash is coming. Whether due to economic meltdown or a black swan event, it is coming. Cheers, RickO
I take his "warnings" with a grain of salt. J.R. has been wrong with most of his predictions for several years now. Yes, he hit several right on the money about 10 years ago, but as the saying goes: "What have you done for me recently?" Google is your best friend.
It's likely he's correct but much like 2008-2009 the 2018-2019 crash (or whenever it occurs) will likely have bounced back to pre-crash levels within 2-3 years. The USD has plenty of life left in it for another $5T QE + $10T Fed deficit spending over a few years to get things back up and jogging if not running.
$1 trillion annual Federal deficits will look small a decade from now. We'll be trying to keep them under $2T and think things are peachy if we do.
Seeing how gold lost 35% (and silver 60%) in the last asset deflation, im not so sure the PM bugs will feel vindicated.
Knowledge is the enemy of fear
Seeing how gold lost 35% (and silver 60%) in the last asset deflation, im not so sure the PM bugs will feel vindicated.
The metals bounced back much quicker after the 2008 asset deflation. However, given the market manipulations that have been standard fare since 2011, there is no reliable predictor of what the metals will or won't do during the next big asset crash. I think that a lot will depend on what other factors come into play, such as supply lines and credit availability. I think we're looking at more uncertainty and less resilience in the economic system because of the screwed-up rules that congress and the banking system have saddled us with, the ones that reward non-productive behaviors and punish productive ones. Free money for cronies and welfare queens is killing the country.
I knew it would happen.
the ones that reward non-productive behaviors and punish productive ones.
Like non productive gold and productive equities?
Knowledge is the enemy of fear
depends on how many asset classes pop. The more that bust, the better for gold.
Gold always takes an initial hit in a massive market decline. They come back much stronger and much quicker than the others. Best time to buy will be right after equities deflate.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
It amazes me every time what some of you want to happen, all just to think (dream) you will make a few bucks from your metal stash. The stock market affects far more people than us loons that try to build our piles of shiny.
Therefore, your metals might be worth more, but a loaf of bread will cost $20 is the economy some of you are hoping for. Balance my friends, there must be balance to have any sense of stability. Without it, our metals will surely be ours and our loved ones for a very long time when we're gone from this Earth...because no one will care enough to want to buy them. They'll (the majority affected by a huge market crash) be too worried about where and when their next meal is going to had.
So I should buy gold after equities drop? Shouldn't I be buying equities after equities drop? That worked purdy darn good the last time....and everytime.
How about just concentrating on an asset class when it's relative valuation vs other assets reaches extremes....such as in 2000 when the NAZ was 5000 and silver 4. Or when silver was 50 and the NAZ 2000? Relative valuation measures can save many from mistakes and provide great opportunity. I would encourage everyone to practice this, and it can be among anything....price of gold vs real estate, price of almonds vs a new car, price of education vs equities. Try it. It's fun. And can be quite enlightening the more creative you get.
Knowledge is the enemy of fear
It amazes me every time what some of you want to happen, all just to think (dream) you will make a few bucks from your metal stash. The stock market affects far more people than us loons that try to build our piles of shiny.
You've got it all wrong. Nobody is rooting for the stock market to crash, hoping that metals will skyrocket. That may be the reasoned opinion of some, but nobody I know is hoping for that scenario.
_So I should buy gold after equities drop? Shouldn't I be buying equities after equities drop? That worked purdy darn good the last time....and everytime.
How about just concentrating on an asset class when it's relative valuation vs other assets reaches extremes....such as in 2000 when the NAZ was 5000 and silver 4. Or when silver was 50 and the NAZ 2000? Relative valuation measures can save many from mistakes and provide great opportunity. I would encourage everyone to practice this, and it can be among anything....price of gold vs real estate, price of almonds vs a new car, price of education vs equities. Try it. It's fun. And can be quite enlightening the more creative you get._
Maybe that is in fact a good way to increase your holdings. Maybe so. But you and I both know that there are never any guarantees. If I wanted more variables to actively manage, that's perhaps what I would consider doing.
But I don't, and I'm not.
I knew it would happen.
There are no guarantees, but a balance of at least 3 different asset classes Imo provides the intersection of the greatest probability of decent long term gains and reasonable amount of net risk, (factoring in valuation fluctuations over time periods, relative opportunity cost, and best-case and worse case scenarios)
Some folks around here hold five distinct and partially offsetting investment asset classes: Precious metal bullion, (yay!!) Rare coins (and a few other "auctionable" collectibles), equities ( individual common stocks and mutual funds are both in this bucket) , private equity investments which pay income and dividends, and rental real estate in different states.
Such folks would be less comfortable "come what may" if they were less diversified in their holdings, because they do not believe any of those will stay down forever, even if one or more "corrects" following a period of outperformance. Such an event might even be welcome as a time to rebalance.
Liberty: Parent of Science & Industry
This is true
The more exposed you are the more likely you are take a beating. You have more opportunities for a loss. Ever think of it that way?
I know, you might say the more diverse one is the less chance they have of losing it all. I'm just offering an opinion that might not've been considered due to wearing blinders.
Such folks have taken loads of losses, and heaps of proverbial beatings, and will again. Even so, they remain far ahead of where they'd be if they had spent their prime earning years "hunkered down"
Liberty: Parent of Science & Industry
Being diversified is the antithesis of "having blinders on". He is prepared for many possible scenarios. The greatest mistake people make with their investing isnt improper asset allocation, but rather letting emotion override rational thought.
Knowledge is the enemy of fear
So many people have already been wiped out swimming with the sharks. First rule of investing asset preservation and don't put all your eggs in one basket.
About those bubbles
"The reason why these bubbles exist is simple: the Federal Reserve has not allowed the market to do its one and only job, and that is to determine fair value. The Federal Reserve's interest rate suppression cycle has not only allowed, but has been the driving force behind mass malinvestments across the entire spectrum of asset classes and as such, bubbles have been created."
"The Federal Reserve has created distortions across the spectrum of asset classes which is frankly beyond belief, worse than has ever been witnessed in the history of finance. What this means is when the yield curve inverts this time, we will experience a meltdown magnitudes greater then the 2008 crash."
FED boom/bust cycle at work. Coming next. . . the bust.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
While hedging provides safety it defeats the purpose (and reward) of risk. One must decide between capital preservation or capital multiplication.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Wrong again!
An investor's diversification plan may very well include allocations toward risky assets, such as biotech stocks and precious metals for example
Liberty: Parent of Science & Industry
And while that diversification may very well protect against losses in other areas does it not also prevent greater gains in those other areas?
My point is that capital preservation and capital multiplication are the two bookends when it comes to investment decisions. The book chosen by the investor and how close it is to one end will dictate his risk and his return.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Yeah, it's better to dump all your cash for an asset that religiously loses 70+% of its value, pays no dividend or interest, is prone to theft, can have liquidity issues and can break your toes.
Stupid Baley. Haha.
Knowledge is the enemy of fear
Appears that to you (always) everything is either this or that. You need to open your eyes to what lies between the two. One cannot correctly place his eggs if he only keeps one in the basket.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
What???!!! I've always written about diversification. You're the one who says only PMs. How's your basket doing?
Knowledge is the enemy of fear
My basket is heavier in PM related assets than most but it is far from being all PM. I actually hold more cash and more real estate than I do gold or silver. My basket is quite full, thanks for asking.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Once again, I must point out that risk can be mitigated in various ways, and there are various types of risk to consider. Being hunkered down while buying into any market consistently over time does a fair job of spreading the market risk out over time while that asset fluctuates both up and down.
And then, there's default risk. The stock & bond markets come with there own set of leverage-related and default-related risks. Conversely, I can be fairly certain that the gold coin I hold in my hand doesn't owe anyone anything and isn't owed to anyone else. I kinda like that idea.
Active management in a serious way requires its own set of costs and constraints. Even if you're a whiz-bang trader with great instincts, you're playing against brokerage houses who haven't had a losing quarter for years.
OTOH, diversification achieves stability at the cost of potentially higher returns, as derryb indicates, whether the diversification is done using risky assets or boring assets - the net result works out in the same way.
I knew it would happen.
Yep, if you put $10 on red and $10 on black you will never lose at the roulette table.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
So holding cash > @derryb said:
So your cash position has defeated the purpose of your PMs, or has your PM position defeated the purpose of your cash position? Can't figure out which decision you made.
Knowledge is the enemy of fear
Well I guess so, that's because it doesn't do anything, neither do my pet rocks, they don't eat neither...
_ it doesn't do anything, neither do my pet rocks, they don't eat neither..._
Yup, just a pretty metallic disk with some images stamped into it. It's almost as if it wouldn't have any value if it weren't for those people and (most) governments who seem to think otherwise.
I knew it would happen.
Who is going to save us?
Wrong yet again,
Forget about green 0 and 00 did you?
Liberty: Parent of Science & Industry
And then, there's default risk. The stock & bond markets come with there own set of leverage-related and default-related risks. Conversely, I can be fairly certain that the gold coin I hold in my hand doesn't owe anyone anything and isn't owed to anyone else. I kinda like that idea.
Jmski, the stock and bond markets have never gone to zero, just like gold.
That coin in your hand can disappear through various means, just like and individual stock or bond. There is no difference.
Knowledge is the enemy of fear
Stocks and bonds are a few extra steps away from your direct control. Other than that, you are pretty much correct.
I knew it would happen.
Simple. I made the decision to use a portion of my cash position to speculate with a still open PM position. Just as I made the decision to use another portion of my cash position to preserve its value with real estate. The remaining cash position stands ready to take advantage of opportunity as it arises.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
you're playing against brokerage houses who haven't had a losing quarter for years.
No you're not.
Knowledge is the enemy of fear
whether the diversification is done using risky assets or boring assets - the net result works out in the same way.
No it doesnt.
Knowledge is the enemy of fear
Why Blythe Masters of course...
The remaining cash position stands ready to take advantage of opportunity as it arises.
Just need to recognize the opportunity. Like the one offered up 8 years ago
Knowledge is the enemy of fear
For some it will be the best of times and for some others the worst of times. Good idea to work hard, do not live beyond your means, and save for a rainy day/retirement as they will sneak up on you quicker than you can realize and then it's too late.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
.
Not going to happen... the 1% will not punish the 1%
Menomonee Falls Wisconsin USA
http://www.pcgs.com/SetRegistr...dset.aspx?s=68269&ac=1">Musky 1861 Mint Set
I believe it's called sector rotation. Real estate, Stocks, collector Cars flying high yet rare coins and bullion way down, right now.
100% Positive BST transactions
_whether the diversification is done using risky assets or boring assets - the net result works out in the same way.
No it doesnt.
_
Do tell. Which assets would you use in constructing a diversified portfolio? The risky ones or the boring ones? metalmeister makes a pretty good point, it does depend on sector rotation, doesn't it?
I knew it would happen.
Sector rotation is not diversification.
I would use all assets.
Knowledge is the enemy of fear
The small time investor usually will sell on a crash that the 1% created... then the 1% will buy up all those shares at a much reduced cost
>
Menomonee Falls Wisconsin USA
http://www.pcgs.com/SetRegistr...dset.aspx?s=68269&ac=1">Musky 1861 Mint Set
There were a couple of good threads on here a couple years ago discussing asset allocation.
These days I'm about 45% stocks, 35% rental real estate, 6% numismatic coins, 4% bullionesque coins and bars, and 10% "other" including speculative business ventures, hedges and insurance, and Hard assets like cash, diamonds, guns, and whiskey.
Liberty: Parent of Science & Industry
Baley, what you see as not particularly risky may in fact be risky, even when well-diversified. But that could be true of any other mix as well. Is there good fishing at your place?
I knew it would happen.
Life itself is risky!
Understanding, and balancing relative risk profiles is important. Youll notice i do not hold any bonds at this time.
Excellent fishing up there, though I rarely visit lately. Our seasonal tenants seem to love it, and write very nice things in the guest book.
Busy with new startup in Baleyville south.
Liberty: Parent of Science & Industry
risk level is in the eye of the beholder.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey