>> This one scares me more than any of the other big problems caused by “hope and change”
It sure keeps me awake nights.
Cash is a doomed investment. That much is easy enough to understand.
but...
What to do with it?
When?
Will the onset of inflation be sudden, or will there be a ramp?
Will there be a separate, delayed bottom in other asset classes, like real estate?
Will the signs be clear? Will I miss them?
Will I jump prematurely at a *false* sign?
&etc
It sure keeps me awake nights.
Cash is a doomed investment. That much is easy enough to understand.
but...
What to do with it?
When?
Will the onset of inflation be sudden, or will there be a ramp?
Will there be a separate, delayed bottom in other asset classes, like real estate?
Will the signs be clear? Will I miss them?
Will I jump prematurely at a *false* sign?
&etc
“boiled frog”
Cash is a doomed investment. That much is easy enough to understand.
but...
What to do with it?
When?
Will the onset of inflation be sudden, or will there be a ramp?
Will there be a separate, delayed bottom in other asset classes, like real estate?
Will the signs be clear? Will I miss them?
Will I jump prematurely at a *false* sign?
If you think there is a risk of unrest and disruption, then invest in tangibles you keep on hand, like storage food, guns and ammo, etc. If you have more to invest, then buy “junk” (1964 and older) silver coins, and gold bullion coins. www.tulving.com has good prices and is reputable.
Keep in mind that your objective should not be to time the bottom to buy in. If you believe inflation is inevitable, then enjoy the current period (a year or more?) when you can still buy all these things at reasonable prices. The longer you are “wrong” (gold goes down, not up) the better off you are because you can buy in more cheaply, and secure your position for the inflationary period.
If you currently have a big wad in cash or stocks, then you could take the risk of buying all on one day, Wich I don’t advise. Instead, put in 10% each month for 10 months and average out the risks. If you are feeling lucky, buy on the day each month when it looks like gold (or your chosen item) has dipped more than expected. If you will be investing out of earnings for the next year, then you actually want gold (or whatever you’re buying) to go down so you can buy more before it takes off.
If you believe that there could be nasty disruptions, then consider whether you would be better off having your assets in a brokerage account, safe deposit box, a hole in the backyard, or something else. If you are keeping any on hand, seriously weigh the risk of theft (home invasion gun to the head) so practice EXTREME secrecy, even if you’d like to show off your glittery treasure. And don’t put all your eggs in one basket, and be creative.
Also, one of the great inflation hedges is DEBT. But only fixed rate long term debt. Be sure your house is financed with a long-term mortgage at a fixed rate (under 5 or 6%) if you can safe a point by refinancing, that’s nice, but the real difference will be ~5 years from now if interest rates are 15%, and you’re paying off your loan with dollars that have a small fraction of their current value. Don’t even consider variable rate loans (though a line of credit can make sense just to have on hand).
In the ideal world, you’ll have enough saved in tangibles (like gold coins) to pay off your mortgage if you wanted to when inflation has increased the price of gold by 4 times. that means putting 25% of your mortgage dept into tangibles.
Not that I advocate paying off the mortgage should that come to pass. You should average out of a major asset just like you average in.
Basically, if you really believe things are going to go inflationary, then there is an easy way to win (or at least preserve your wealth while most others are losing theirs). The real challenge is deciding when the crisis is over, and when to sell what you bought to get you through the crisis.
Try not to worry or fear, because you must remember the lesson of JOB in the Bible:
“The thing I feared the most has come upon me”>>>and life works that way. We discuss some worst case scenarios, but truthfully we will do better if we push fear out the window, and know that God will help us all.
when we have shortages.....due to closing of factories, and docks, etc and of businesses.....we will see price hikes in a matter of days.....