Posted on 07/24/2021 7:26:16 AM PDT by Andy from Chapel Hill
So, Stanley Druckenmiller ("Druck") says this is the biggest bubble he has ever seen.
If we believe him, how do we adjust our IRAs and other investments -- especially for those of us approaching retirement?
I know the gold story, but what else can we do? (I like platinum better...)
Neither wing of our one political party will ever again put the long-term health of our country ahead of what they understand to be their own best self interest.
I don't see how the federal government can ever allow interest rates to rise to the three-to-five percent level. Our 30 trillion dollar debt would then have to be serviced with more money than we take in through income taxes.
The best investment strategy on a personal level is to identify the Antichrist and invest like he does. The Antichrist is going to pull the strings, and command the bayonets, to ensure his wealth grows and is protected. As long as he is in control, that is.
the inflation (”Printing” of trillions of new dollars out of thin air) is why the stock market is so high.
could the market plunge while all this “stimulus” is being injected into it? yes, but it seems unlikely
sort of like me losing weight while my mama feeds me cheese cakes all day every day
Inflation will cause rates to rise which will trigger a market crash (at some point).
Bookmark
A stable value fund is a short to intermediate bond fund with an insurance wrapper to “guarantee “ redemption at $1 a share. They are as safe as the insurance companies issuing the wraps. Back in 2008 many of these funds book value dropped to $ .80-.85 on the dollar. The are only available in qualified retirement plans and operate on the principle of low redemptions. If it gets as ugly as 08 or worse you could see liquidations frozen or only made at book value if your company wants out of the fund immediately. You should be able to see the current book value somewhere on your plan website. 100% or better is what you want to see.
I believe the mortgage and rent deferrals (COVID) have allowed squatters to remain in properties that should have been put to the market. It has limited the turnover and supply of homes and rentals driving up prices for all.
"standby and have cash ready to move quickly....."
When supply returns prices will collapse. Those who have taken out equity by refinancing their homes will be, "under water" for a lot of money and may abandon their property, defaulting on loans. Credit markets will seize up new lending. There will be pain.
One problem with owning gold during a crash is that big players often liquidate gold holdings to raise cash to either meet margin calls or to scoop up bargains. That is the reason why gold often drops.
I am amused - we have not seen a correction since 2009 - minor hiccups.
When the market dump does come, no one here will be ready
Yes it will be deflationary
Balanced funds...
This is NOT advice, but I hate *all* paper instruments these days, including bonds. Plus, bond are SLOOooowwww money, even over time and even when they’re paying.
Again, NOT advice, but I went full hard assets a while back- real estate, oil, silver, guns, ammo, guitars etc. Right now, improving the real estate you own is a good investment, except for materials and labor.
The only paper I hold is for my oil index fund, only because I can’t keep oil in my house.
That’s what I am thinking it’s a shame to profit off someone else’s misery but that’s how the system works but you can only take advantage if you are prepared
That would not be sufficient return to fund a retirement. Using the 4% rule, you would run out of money in no time at all.
I prefer auto-allocating your 401(k) based on age and years until retirement. Even now, at the cusp of retirement, I have about 60% of my holdings in stocks (mostly index funds based on S&P) and aim for a 5-6% annual return even in retirement.
I am also building cash savings of about two years of expenses. That will allow me to live on that in years that the stock market is not doing well. Eventually though, we fully recover from even the worst "crashes."
I can still remember the 1987 stock market crash, when I was just starting out my 401k. Older people were solemnly telling me to bail out of the stock market completely while sipping their 7 and 7s. Glad I didn't listen to them. I stuck with it and my 401K balance now has a couple of commas in it.
I have never reacted to a stock market "crash." I just stay the course and try to keep at least 10% of my income feeding into the 401k. Those who can stick it out actually do better in the long run through dollar cost averaging. (Buying more shares when prices are low).
I don’t see commercial real estate as a good bet. Rental housing is a different story as long as it is affordable housing. Class A rental housing could be at risk in a downturn.
Who would want to own office space in this remote work environment?
You're correct. But sometimes it's the best place to be if you're too old to earn the cash back if you lose it all in some investments like we did in the fall of 2008 before Obama was elected.
We had worked hard to save and invest our money to be able to retire but the stock market had different ideas and we lost more than half the value in those investments before we realized what had happened.
Stung by the losses, but undeterred, we changed out strategy and took our remaining assets out of the market and put them in cash accounts. We sold our rentals and built a new retirement home for cash. Paid off everything else, so we were debt free.
We started a beef cattle operation on a ranch in the country to take advantage of an agricultural exemption offered by the state. Our property taxes dropped to almost nothing. We sell the calves every year at auction to pay for our property taxes on the land and house. The money we lose on the farm and my other small business, I write off on my taxes and pay no federal income taxes. The state has no income tax.
In the ten years since retiring, our savings accounts have tripled in size and we have never lived more comfortably financially than we do now.
It may not be the strategy my financial adviser offered for our retirement, but it's what ended up best for us. As an aside, my financial advisor, who I went to college with, died before he could retire. Karma?
Anyway, there is more than one way to skin a cat when it comes to investing for retirement. We followed our personal instincts and are doing just fine.
I’m out into money market completely.
As soon as the bubble pops and hits about 27500, I’ll be back in. It really depends on if this infrastructure bill gets through.
“RESET: If the market crashes, and inflation runs rampant, how do we adjust our investments?”
BOTH market crash AND inflation runs rampant?
how would BOTH of those things happen concurrently, anyway?
the Dow has risen only 13% since the Bidenistas took office, which is hardly bubble-crash territory ... inflation has taken off too, but it’s certainly not in Carter territory ...
I bought a bunch of platinum and silver in 2008 timeframe, has not done much for me and I am still down about 44%
I have noticed whenever the market takes a dive silver and gold do as well.
I do not remember a time when gold and silver went up as the market was going down.
at this point I am assuming that the stock market is going to go up as the value of the dollar goes down.
Not that I am selling any silver or platinum till over 44 and 2k
Land and gold and food.
and mountain money...
BOHICA
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