Posted on 02/14/2017 10:53:54 AM PST by DFG
Smart economists never predict the stock market. Our theory tells us that it's impossible. Leaving aside inside information, everyone already knows what we know and has traded on this old news and moved stock prices accordingly. Princeton economist Burton Malkiel popularized this point in his famous book A Random Walk Down Wall Street. The fact that only "new news," things that people don't yet know or expect, should change stock prices means that stock movements are supposed to be random — that is, unpredictable.
(Excerpt) Read more at dallasnews.com ...
Interesting you should bring that up. That’s how my brother in law got rich. I mean multiple yachts, private jet, multiple 8,000+ homes in multiple countries rich.
I’m not trying to get rich off it, though. It’s just a SHTF protection.
“It’s just a SHTF protection.”
Sure it is.
“I would hold ten Morgan silver dollars in my hand and say, back in 1922 these were worth $10. In 1972 they were worth $10. They are now worth $400. What changed?”
Under Lyndon Johnson silver coinage ceased being minted in 1965 and copper-nickel alloy was substituted. Any silver U.S. coin is worth more than face value and its cupronickel equivalent is worth face value only, even the Ike cartwheels.
FWIW I have a few dozen `Peace’ cartwheels in the safe in case of SHTF. Worth around $20.00 each, they are far more negotiable than gold, IMO.
Worth around $20.00 each, they are far more negotiable than gold, IMO.
I don’t trust gold.
Don’t own any of these single issues and if I did I would look at what the institutional holders are doing for guidance .
“the market” .....pretty broad term and I suppose just how you are in “The Market” makes a dif.
That is probably why the SOB is advising this.
Forget what these talking heads on TV and the internet are saying - BUY STOCKS, SELL STOCKS, BUY GOLD, THE SKY IS FALLING, GET OUT NOW, blah, blah, blah ....
***To win over the long-term as in investor = get a CFP professional, use proper asset allocation, manager selection, stay invested during downturns, stay disciplined, and use technology.
The average investor over the last 20 years earned 2.1% annually. S&P 500=8.2%. REITS=10.9%. Why so badly for the average investor? Because they naturally do the wrong thing at the wrong time. They buy high & sell out low. They want to cut their own hair and it usually ends up a mess. Having a good CFP can avoid all this and provide much higher long-term, risk adjusted returns for investors.
“But it is priced at an all-time high”
Not true in PE terms. Right now the PE is 26,in 2002 it was 42.
Used to be that if you put $1000 in the market, and $1000 in silver coins and buried them, 60 years later the coins were worth more than your stock.
Probably happened a couple of times. But it is not the way to bet. 60 years is a very long time to wait for a return on investment.
60 years ago, Silver was about $1.50 an ounce. Today silver is about $18 an ounce, or 12X increase over the 60 years.
60 years ago the Dow was about $786. Today it is $20,471, or 26X increase over the 60 years.
Before 1964, silver was pegged to the dollar.
Exactamundo - diversity IS our strength, when it comes to investing.
Here’s Harry Browne’s very simple diversified portfolio.
A market crash is always “just around the corner”. The seers can never tell us exactly when, how much, or how long.
I disagree we are seeing a great future of investing. Those Fidelity fans check out FSELX and FSDAX, a semiconductors fund and a defense fund. Also we like ROGSX another tech fund.
That’s what I did back in 2007. I got started working with a CFP firm. I have a single CFP who I’ve always worked with. I have his direct number and email and can contact him any time with questions and concerns. We have a regular meeting every 6 months and I get monthly emails and updates on the health of the market and my accounts. He helped me work out a ‘roadmap’ towards my eventual retirement. Part of this roadmap is on maximizing as much return each year as possible which involves buying, holding, and selling. They even have their own in-house monitoring trend that watches for signs in the markets that can signal a downturn and they have plans in place with how to handle it. Back in 2008, their system indicated a downturn event may be coming so they basically moved everything I had into cash (getting out the market). Less than a month later at end of September, the market crashed. They keep everything in cash for a couple months until the trend moved in the positive direction and then put the money back into the market.
The 2-3 silver dime analogy works good at the pump too, they buy as much or more gasoline than they did throughout 20th century history. It’s also a good chaos indicator, if the price stays over ~$0.33/gal or under ~$0.18/gal pre 1965 US silver coinage for more than 4-6 months something is seriously out of whack.
Just a few days ago I read an article at Free Republic by Supply Side economist George Gilder.
Gilder was advocating exchange rates linked to gold and silver as a method to stop currency manipulation in international trade.
Yawn, old idea, no traction.
But then Gilder wrote something I had never thought about before.
He advocated removing capital gains taxes on gold and silver in the USA, then re-authorizing gold and silver as “legal tender” for any bill owed to the federal government, and eventually, I presume, for any bill in the private USA economy.
That strikes me as really cool idea.
That means that private or corporate USA owners of gold and silver, or owners of financial surrogates for gold and silver, can hedge, without any tax penalty, against currency devaluation by any foreign central bank or by the Federal Reserve.
Example: if China devalues, the value of the Chinese yuan against gold will drop, which means your gold will buy more yuans, or, it will buy more goods that are priced in yuans.
At first glance, it looks to me like this idea might be a legitimate tool for attacking the monopoly power of central banks.
$10 from 1922 is worth $142.86 today.
$10 from 1972 is worth $57.42 today.
1oz of silver in 1922 was worth $9.71 (in 1922 dollars) or $138.72 today.
1oz of silver today is worth $17.54.
1oz of silver in 1977 (peak) was worth ~$101.37 before it crashed down again.
If you invested money in silver you LOST money over ANY long period of time.
As a commodity silver has traded higher at times and there have have been times to buy it as a short term investment.
Stocks are not a “crap shoot”...if you know what you are doing.
Why don’t go short the “M”?
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