Gulp: U.S. to lose AAA debt rating?
That will mean higher interest rates and much greater debt. We can cut the blow in two ways: Print, print, print and inflate ala Weimar or raise taxes through the roof to service the debt and regain our rating.
Where does that leave investors? I suppose stocks are somewhat sheltered from inflation as you own a portion of a company (and not the dollar) but under both scenarios (inflation and taxation) the economy (and companies) take a hit. Gold and commodities work too but you don't want to put all you eggs in one basket.
So where then?
Foreign stocks and bonds?
Any particular sectors fair better than others? I would say health care, but, given the push for Obamacare and their behavior with the auto companies and banks, it seems a lot riskier than would otherwise be the case.
Is it any wonder so much investment $$$ is still on the sidelines. Seriously, what reasonable options are there?
Yep. That's my predicament.
I have been thinking a lot about this and my guess is:
Farmland, farming equipment, seed stock.
When things get really bad the ability to produce food will trump everything. Oh, we might need some extra ammo to defend it all.