[ari-freedom]

we will not have deflation, not with this Fed. We will have a contraction plus inflation: major stagflation.

[stockstrader]

‘Helicopter Ben’ has promised no depression and no deflation.

[eyedigress]

My investments pick up at this point. I’m a number of shares kind of guy. America has wealth.

[conservative cat]

My dad had a great aunt and uncle who bought up property during the depression. They ended up being very wealthy.

[KoRn]

"if we were heading into another deflationary depression the best assets to own are default-free Treasury bills and Treasury bonds"

He neglected to mention guns & ammo. Depression aside, with a dem house, a possible filibuster proof dem senate, and socialist president coming next year, it would be a wise move to buy all of the 'hardware' you can afford and get your hands on. I don't think Hussein will move on gun controls during his first 100 days, there are other matters they will want to screw us on right away. I believe there will be a 6-12 month window to get what you need.

[diamond6]

bttt

[BGHater]

I think it will be a great time to invest. Soon.

I would suggest reading up on Floyd Odlum, he set the standard.

[Babu]

My portfolio is now composed of cash and gold, about 75% cash and 25% gold. I am reluctant to overweight further into gold, but I am considering it depending on what happens next.

This is the wildest financial situation I have seen in my lifetime, and I have been investing for multiple decades. I cannot find glasses tinted rose enough to make this look good.

[VOA]

bump

[Attention Surplus Disorder]

I’m a big fan and longtime student of precious metals as a SINGLE DIGIT percentage of one’s portfolio.

That said: physical gold and silver are hardly reacting as one would expect during these times. They are are not only NOT acting as “inflation insurance”, they are in many cases being liquidated. I won’t even mention the losses that have been suffered of late by the commodity stocks, the steels, the coals, the PM stocks, just jaw dropping 70-75% drops. OF COURSE we must realize that this effect is seriously exacerbated by the idea that many many hedge funds had loaded up on these and had good profits in them. In fact, many hedgies were short banks and long commods, and as we have seen since the recent days of $147 oil, not only have the Fed actions gouged the eyeballs out of these guys (generating mass forced liquidation) but further dumping these sectors as the anticipation of a global slowdown takes root. (gee, do we think that GS knows the positions of lots of hedge funds and knows how to squeeze their livers and reports same to Hanky Panky so he can act...to GS’ benefit, since they can front run the attack? Naaaah, too tinfoil) Regardless of the theory, the markets are so chock full of weird distortions that the unwinding of same is generating tremendous upheaval. Evel Kneivel upheavel.

I realized what I am trying to say the other day when some gold/silver weasel called me to sell me some bullion (already own all I want) but we had a lengthy conversation about this and that.

During a depression or a serious recession, there is an excellent investment to own, and that is GREEN CASH. Why? Because with cash-cash, you can buy assets at distressed prices. With cash, you have a “currency” that is in scarcity. One easy to picture example is, you can buy beaten down stocks. But I am thinking other stuff too. For example, we imagine there is a 8% long term gain to be had investing in the stock market provided you collect dividends. Well, suppose you can buy....a rare car that you crave...or a piece of real estate that MAKES SENSE to you...at 20% discount because YOU have cash and few others do. Doesn’t that amount to a 2.5 year run rate at 8%.

This is my point. All the stories you heard about sharks swooping in and buying price-distressed assets from holders who could not hold on...yeah, those guys/gals were sharp. But THEY HAD TO HAVE HAD THE CASH to swoop. They had to have “dry powder”. They must NOT have been in a similary distressed condition themselves. Think about it. And that is why I think building up cash in a “depression” is an absolutely valid “investment”. And let’s not forget, if you have been bottom fishing stocks during the past few weeks, you are already down a couple of years right here right now. Yeah, sure, stocks could recover, they probably will. In the meantime, they are CANCELING dividends and being repriced lower. Bonds? Longer term bonds will return their miserable coupon, well behind purchasing power inflation, but are IMO likely to lose value because we are alreadyseeing the bond market forcing HIGHER, yes HIGHER rates due to heightened perceived risks, both in coupon AND inflation. So what’s wrong with owning cash? Doesn’t earn interest? How about losing 10% in the past few days? Pick your poison.

[TDT]

<img src=”http://ak.buy.com/db_assets/prod_lrg_images/939/206861939.jpg";

An a very good
<img src=”http://us.st12.yimg.com/us.st.yimg.com/I/basegear_2019_4898135";

[Eva]

My husband’s grandfather did quite well during the depression. He had a depression proof business, a business that probably grew due to the depression. He sold candles to the Catholic church, he had the contract for the whole city of Philadelphia, and the church was his only contract. He never really worked a day in his life. Maybe you could look into that.

[dennisw]

btt

[Iron Munro]

Much of the rush to gold preassumes the economy and the currency system will remain intact and viable and that the gold or gold backed investment itself will never have to be used to actually purchase or barter for something else, especially for smaller items and everyday goods.

Gold backed securities or stocks they are really still just paper certificates, perhaps still held in the broker’s home office. Like any stock certificate, their lack of liquidity means they will be relatively worthless in the short term in the event of a disasterous currency collapse or runaway inflation.

Gold coins, ingots, etc. are a fairly easy way to invest relatively large sums but there are some issues to consider.

The problem with gold coins is that most of them are too large in value to easily be used as a currency replacement in a real collapse. They are probably a good way to invest fairly large sums but, like ingots and boullion, don’t lend themselves well as replacements for everyday currency.

If you actually have gold coins like Kugerands or US “$50” coins that are valued somewhere around $1,000 each how do you use denominations that high to purchase or barter for a tank of gasoline or a package of toilet paper?
There are some smaller denominations available but the value of the individual coins is still fairly high.

As far as gold boullion or ingots, they are even less usable as currency replacements than coins, not only because of their larger size and gold content, but because their authenticity is not easily verified. Most people never actually take possession of gold in this form.
If you take actual possession of boullion or ingots you have to pay to have them re-assayed before you can resell them.
How many of us can tell the real gold content and value of an ingot?

In a TEOTWAWKI scenario a case of pork and beans, some garden seeds or a few bricks of .22 cartridges may be worth more than a gold ingot.

An alternative investment to gold is older, pre 1965 silver coins. The fluctuations in Silver value tracks the rise and fall of gold somewhat, but unlike gold coins, the denominatons of silver coins are small enough to be conveniently used as currency or for barter.
The coins themselves are easily recognized and the ultimate real value is in the silver content itself.

Gold is no doubt a better medium for large investments but rolls of silver coins are a good option for smaller investments with the advantage of being more easily bought, sold or bartered, especially in the event of a disasterous crash.

Here is a good link to see the relative value of silver coins:

http://www.coinflation.com/silver_coin_values.html