Before we can answer that question, I believe we have to have a ‘big picture’ view of the economy and what the significant trends are.
Remember the adage, “the trend is your friend”. Before we can befriend that trend, we have to figure out what it is.
Unfortunately, nobody has a crystal ball to identify economic trends so each of us has to decide for ourselves what the trends are and how far along we are in the progression of the trend. There are numerous investing books and newsletters that can provide us with quidance and advice along these lines but there are no guarantees in the investing world.
Right now, for example, some people believe that the US equity markets are in bull mode and headed to new highs. I personally believe the equity markets are putting in a top that will not be surpassed in my lifetime (and I’m only 42) before they crash (3000 or lower on the Dow).
Obviously, I’m not going to invest in common stocks right now based on my beliefs but other people are loaded to the gills with common stocks and even have them purchased on margin.
My point is that we can talk forever about generalities related to investing but actually putting your money at risk in any given market is a TOTALLY personal decision. You have to decide what YOU think the markets will do and take a position based on that belief.
I have formed my view of the economic world and I have invested accordingly.
My economic view tells me to sell investment real estate and put the money in silver and gold and the companies that mine those metals. So far, that view has served me well.
I have shared aspects of my economic view in these forums. Here are some highlights:
> we are in a commodities bull market that will run until at least 2013 and probably longer
> silver will be $80/oz and gold will be $1650/oz before the bull market is over – perhaps much higher for both
> the US dollar is in the process of losing its status as the world’s reserve currency
> the US dollar has been debased at a tremendous rate since 9/11 and this debasement has accelerated since the US Fed stopped publishing the M-3 money aggregates in March of this year
> we have seen the end of cheap energy whether we are at peak oil or not
> war with Iran serves many purposes for the Bush administration and is most likely inevitable – this war will cause the energy and precious metals markets to soar
> the baby boomers have been promised retirement bennies (social security, medicare, prescription drug benefit, etc) to the tune of about 30-50 TRILLION dollars and NONE of this money currently exists – there is no “Social Security Trust Fund” that the boomers are going to start drawing on when they retire – this money will come straight off the printing presses
In summary: I can’t tell you where to invest – all I can do is share with you how I am investing and why. All my investment money is in the commodities bull market with a heavy emphasis on silver. I will add to this position as funds become available and I will be holding this position until at least 2013 unless events dictate otherwise. Hope that helps.
I will post later in the week about the newsletters and web sites that I find most valuable inre the commodities bull market.
