[Wiley]

I remember Cramer and the Street.com was bearish on gold back in 2004. They were wrong then too. It’s telling they don’t mention the inflation adjusted average price of gold.

[Wiley]

I’ll take a stab.

If you do not buy a house and you have all your assets in stocks, bonds or cash aren’t you vulnerable in case inflation comes back like the 1970s ?

Thats a very open question. Depends of which one your talking about. Cash, yes your a loser. Stocks, depends on which ones. Some may do well if they are corrolated to businesses that can take advantage of inflationary items ie. energy, minerals, etc. Bonds I don’t feel are even keeping up with inflation and definitely not paying for the risk right now.

In Mozambique right now their market is doing fairly well even though they are experiencing hyper inflation. In the end the currency will be worthless (which is why they are trying to trade the currency for anything they can) so again here they will lose.

The key here is to pick which outcome we are likely to experience in my opinion. I’ll answer your last question on my belief we’ll experience stagflation (inflation in items we need ie food, energy, things and deflation in non-essential assets that have increased wildly based on debt inspired purchases, ie housing, cars, discretionary items.

So yes in nominal terms your loan amount decreases with inflation. The problem with your assumption is whether or not the assett will hold its value as well as whether or not your wage inflation will keep up your other living costs and debt servicing costs on non fixed items (normally interest rates rise in inflationary times).

If the stagflation morphs into hyperinflation or even deflation it will be tough as unemployment soars and servicing your debt becomes difficult.

There is much much more to all this. I think the majority of housing bears here inluding myself feel in the intermediate future it will pay to hold cash as the decline in debt fueled housing mania will provide a better return, purchasing later then now. I’m sure others here can say it better then I.

So where do you hide. For me precioius metals, energy, and foreign stocks.

[Wiley]

I’ll take a stab.

If you do not buy a house and you have all your assets in stocks, bonds or cash aren’t you vulnerable in case inflation comes back like the 1970s ?

Thats a very open question. Depends of which one your talking about. Cash, yes your a loser. Stocks, depends on which ones. Some may do well if they are corrolated to businesses that can take advantage of inflationary items ie. energy, minerals, etc. Bonds I don’t feel are even keeping up with inflation and definitely not paying for the risk right now.

In Mozambique right now their market is doing fairly well even though they are experiencing hyper inflation. In the end the currency will be worthless (which is why they are trying to trade the currency for anything they can) so again here they will lose.

The key here is to pick which outcome we are likely to experience in my opinion. I’ll answer your last question on my belief we’ll experience stagflation (inflation in items we need ie food, energy, things and deflation in non-essential assets that have increased wildly based on debt inspired purchases, ie housing, cars, discretionary items.

So yes in nominal terms your loan amount decreases with inflation. The problem with your assumption is whether or not the assett will hold its value as well as whether or not your wage inflation will keep up your other living costs and debt servicing costs on non fixed items (normally interest rates rise in inflationary times).

If the stagflation morphs into hyperinflation or even deflation it will be tough as unemployment soars and servicing your debt becomes difficult.

There is much much more to all this. I think the majority of housing bears here inluding myself feel in the intermediate future it will pay to hold cash as the decline in debt fueled housing mania will provide a better return, purchasing later then now. I’m sure others here can say it better then I.

So where do you hide. For me precioius metals, energy, and foreign stocks.

[Wiley]

4plex,

I use Tradestation also. It’s amazing. A few months ago I was in Denver getting my pilots license so in the mornings I would go to starbucks and trade before my lessons. I made 70k in a month trading nat gas. Got home and gave it all back in two weeks. Just cause their mini’s doesn’t mean its not still huge leverage (as I’m sure you know).

I love playing around with the automated trading but all “things” I believe trade differently which means you can only develop a system for one stock or contract. Then if you can find one that works eventually that “thing” will eventually start trading differently as well.

Even though net/net I doubt I made much if any (especially when you include tax implications) I love the challenge the market brings and I’m confortable my core holdings will do well.

Just my thoughts.

[Wiley]

4plex,

I use Tradestation also. It’s amazing. A few months ago I was in Denver getting my pilots license so in the mornings I would go to starbucks and trade before my lessons. I made 70k in a month trading nat gas. Got home and gave it all back in two weeks. Just cause their mini’s doesn’t mean its not still huge leverage (as I’m sure you know).

I love playing around with the automated trading but all “things” I believe trade differently which means you can only develop a system for one stock or contract. Then if you can find one that works eventually that “thing” will eventually start trading differently as well.

Even though net/net I doubt I made much if any (especially when you include tax implications) I love the challenge the market brings and I’m confortable my core holdings will do well.

Just my thoughts.

[Wiley]

I’ll fess up. I love the markets. I love economics. I read about 6-8 hours a day papers on economics, company research, etc. I day trade stocks, options, and futures (commodity only). I’ve done this for about the last 8 years seriously.

I’ve made tons of money and immediately gave it right back. I stayed completely out of the dot com deal but to be honest I really wanted to short it when the nas was about 3/4 the way up. Thank god I didn’t.

My feelings are its only good as a hobby. You trade what you can lose. I have other accounts that I rebalance once or twice a year that actually make me money but I’d have to say I’m probably flat when it comes to day trading. I know I made some dough the last few years but the last 8 months has killed me in my day trading accounts.

You have to have a fundamental view about what your trading (and it also has to happen to be right). Then you only trade in the direction of your view. Doing both of these will make you money but you can also get whipped out of money if you use leverage and time it wrong.

There is no free lunch and its especially true with the markets. Some guys can see through the noise to the true fundamentals and those are the ones you learn from. Definitely not day trading only on technical analysis or listening to guys like me on these blogs. I’m talking about guys with great track records like Warren Buffett, Jim Rogers, Marc Faber, Jim Sinclair, etc.

I have yet to see a day trader post his trades in public. I guess its possible to make it but I’m a skeptic and I am one.

[Wiley]

I’ll fess up. I love the markets. I love economics. I read about 6-8 hours a day papers on economics, company research, etc. I day trade stocks, options, and futures (commodity only). I’ve done this for about the last 8 years seriously.

I’ve made tons of money and immediately gave it right back. I stayed completely out of the dot com deal but to be honest I really wanted to short it when the nas was about 3/4 the way up. Thank god I didn’t.

My feelings are its only good as a hobby. You trade what you can lose. I have other accounts that I rebalance once or twice a year that actually make me money but I’d have to say I’m probably flat when it comes to day trading. I know I made some dough the last few years but the last 8 months has killed me in my day trading accounts.

You have to have a fundamental view about what your trading (and it also has to happen to be right). Then you only trade in the direction of your view. Doing both of these will make you money but you can also get whipped out of money if you use leverage and time it wrong.

There is no free lunch and its especially true with the markets. Some guys can see through the noise to the true fundamentals and those are the ones you learn from. Definitely not day trading only on technical analysis or listening to guys like me on these blogs. I’m talking about guys with great track records like Warren Buffett, Jim Rogers, Marc Faber, Jim Sinclair, etc.

I have yet to see a day trader post his trades in public. I guess its possible to make it but I’m a skeptic and I am one.

[Wiley]

Love McEwen. Made me lots of money when he was ceo of GG.

As for risky, the dollar has lost 30% in the last 7 years while the HUI is up 650%. Having said that, Mark Twain did comment once that if you show him a gold mine he’ll show you a liar standing over a hole.

[Wiley]

Love McEwen. Made me lots of money when he was ceo of GG.

As for risky, the dollar has lost 30% in the last 7 years while the HUI is up 650%. Having said that, Mark Twain did comment once that if you show him a gold mine he’ll show you a liar standing over a hole.

[Wiley]

To paraphrase Buffett’s investing ideology…buy things no one wants. The fact that gold has been down for 25 years makes it all the more interesting. The complete bearishness on gold right now makes me believe a move up is in the cards short term (2-3 months).

I believe all commodities will run for another 20 years. At that time there will be guys like noone saying “well the dow’s been down for 20 years…”

Gold is no ones liability. Think about that in this debt based, asset inflated world.

[Wiley]

To paraphrase Buffett’s investing ideology…buy things no one wants. The fact that gold has been down for 25 years makes it all the more interesting. The complete bearishness on gold right now makes me believe a move up is in the cards short term (2-3 months).

I believe all commodities will run for another 20 years. At that time there will be guys like noone saying “well the dow’s been down for 20 years…”

Gold is no ones liability. Think about that in this debt based, asset inflated world.

[Wiley]

The real kicker with inflation is the negative return asians are getting on their treasury bond purchases. When they tire of this they will sell them, causing rates to escalate here. With a debt based, asset economy that is not a good combo. Actaully they could just stop purchasing them to cause the same resulting uptick in rates.

[Wiley]

Temeculaguy,

Have you seen the chart of the Japanese housing bust?

And their fundamentals were much better then our imho.

[Wiley]

The whole gun debate reminds me of the housing debate. People just take the side of what they are hearing in the media and assume its correct (and believe its their own thoughts). Even when given facts they want to dispute it with irrational arguements.

I’ve grown up with a gun on the kitchen counter and others in the house since I can remember (cop father). It never ceases to amaze me how people who see a gun lying around freak out. “oh guns scare me” is the usual statement.

Why don’t they walk out in the driveway and say “oh that car really scares me”. I’m sure they are 1000 times more likely to die in that car then by a gun.

In Freakanomics the writers pointed out that if you send your 10 yr old child to a friends house who own a pool that kid is 100 times more likely to die then sending him over to the friend that has guns in the house.

If you don’t want to own a gun to take responsibility for your self and/or your family, cool. But please don’t give up more of our rights to the government who may or may not be there when you need them.

[Wiley]

Bugs,

I disagree about a gun owner needing regular training to be competent in his shooting ability to the point of protecting themselves. I have a 12ga shotgun under my bed loaded with 00buck. As to a handgun I agree with you.

Now to a gun trivia question…what the safest gun there is to carry?

The one you have with you at the time someones shooting at you.

[Author]

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