Tradefair & Financials
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02 Oct 11
17:21
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16 Jul 08
.... that the worst case scenario will play out over the coming months .. how should you position yourself from here ?
particularly with regards to savings. thks
particularly with regards to savings. thks
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tell us what you think the wrst case scenario is and it'll be easier to answer.
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tbh charlatan , like most of the world/markets i really don't know what might happen.
i suppose i'm looking for a plan to protect what i've got should defaults/ run on banks/ and a lack of faith in fiat currency start's picking up steam. what are the best assets you could pick up quickly which might protect you ? |
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my question is not clear , sorry
not how to position yourself from here but if you didn't want cash in the bank at any stage which assets would you buy or what would be the safest ploy ? popping out for a while appreciate any answers |
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Gold if you think it's going to be quick.
If you think they can kick for an awfully long time then get rid of as many obligations to pay as you can. |
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Stocking up on food and water might be a good place to start, medical supplies wouldn't be a bad idea either. Then start thinking about acquiring in some quantity items you can use for barter. Cigarettes were the currency of choice when Yugoslavia collapsed in it's hyperinflationary hell but liquor has always been universally accepted as a good barter item when fiat money dies. Then it would be time to pull those floor boards and recover that gold you'd be buying and stashing away over the years. If you do all that, and avoid getting killed in street riots from an angry mob who were clueless, didn't take any precautions and is now looking for food and someone to blame, you should be in great shape.
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above post shows good knowledge and experience.
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Let us hope , Menelaus , that we don't get to that stage.
Please excuse me for taking time to frame this question properly ! If i wanted to take cash out of the bank and buy a highly liquid safe asset that would keep it's value until the dust settled, if it settled, what could that asset be ? I'm not looking for profit , just protection. Financial investments are not my strong point. |
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c/l, I too hope it doesn't get to that but what you described (loss of faith in fiat currency) is hyperinflation (I wonder if benny ever got it that hyperinflation is not just very high inflation?
 I doubt it). What I described is how I would deal with hyperinflation.Your latest question is tougher to answer especially when the words "highly liquid", "safe asset" and "keep it's value" are included in the same sentence. I still think the best safe-heaven out there is GOLD. The key requirements however with using Gold as a wealth preservation mechanism are: 1) DON'T buy if you anticipate you may need to liquidate gold to free up money for other purposes in the near to mid-term future 2) NEVER buy with leverage 3) DON'T get involved in gold if you can't handle big price volatility without panicking. Anxious to hear what others have to say about this. |
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Yes , sorry . I havn't been that clear so far but i understand what you are saying.
If it's not too much trouble , can i ask your opinion with regards to silver for this example also ? This sell off back to $30 surely represents a chance for buyers again. Also, how much affect would inflation and hyperinflation have on both of these metals ? Thanks for your time . It's much appreciated |
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Gold is a monetary metal (that's what Central Banks own - at least until they lease it out to suppress the price), Silver on the other hand is an industrial metal. So in that sense, if you are looking to preserve wealth with "real money", Gold is the way to go. If you wanted to be more speculative, with a significantly higher upside, then silver is the way to go. It's been suppressed by the bullion banks far below it's true market value for a long time now and physical availability (lack of) sooner or later will change that dynamic.
Having said all that, I wouldn't buy at this level, Gold or Silver. I think we have further down to go. I'll do a separate post on it if I find time. |
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Thanks again for your thoughts there Menelaus.
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"GOLD & SILVER
Menelaus 22 Sep 11 17:26 Joined: 03 Feb 05 | Topic/replies: 1,113 | Blogger: Menelaus's blog ....Silver is being exposed again for what it is, an industrial commodity, not a monetary one. Even at that, I'm a buyer at dips below $35." less than 2 weeks later after a 15 percent loss... "Menelaus 04 Oct 11 22:45 Joined: 03 Feb 05 | Topic/replies: 1,113 | Blogger: Menelaus's blog ....Having said all that, I wouldn't buy at this level, Gold or Silver. I think we have further down to go. I'll do a separate post on it if I find time." absolutely clueless. |
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Oh, what do we have here? The fanboy pin-up boy crawls out of his hole again.
Does buying at $26 count? You are a half-wit masquerading as a trader. The AAPL pain though is starting to set in. It will get you straight, I assure you. |
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Don't get me wrong, I still have enormous respect for for fictitious aapl vs. silver cage match. Now if you could figure out a way to increase your wealth with fictitious profits, I'd respect you even more, my nz clown.
By the way, does JPM have any massive naked short positions on aapl? Just wondering..... |
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"Does buying at $26 count?"
sorry, but after-timing doesn't count. |
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You truly are wasting the air you breathe.
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Menelaus , a question about silver that i asked in another recent thread.
If you are tempted to buy silver below $35 and i presume you mean physical, what is your opinion on paying the 20% VAT ? I have seen calls to abolish the VAT in the past. Is there a way around it ? (ie purchase from elsewhere other than UK or EU ?) |
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c/l, I make buying decisions based on what market fundamentals and technical analysis is telling me at the time. For a while it looked on the charts like the Silver carnage would stop at the $33-35 level. It didn't, it overshot to around the $26 level. Obviously if you were buying the dips below $35, then you were a buyer at $31, $29 and $26 (the stops in between). It seems like the clueless "buy apple" clown from nz has a hard time grasping that concept. Based on how the chart looks today, I am of the opinion that we are headed lower so I'm in no rush to buy - we're already over 1pc lower than last evening when we had this conversation. (it would take an entire separate post to explain why the charts look bearish)
As far as paying VAT goes, if you are buying in significant quantity I don't know how you can avoid it. If you are buying a few ounces at a time and you have an established relationship with the dealer, I assure you that cash deals (no paperwork) are welcomed on both sides of the counter. |
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Thankyou.
No more questions , for now anyway  Have a good day. |
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another question for whoever feels like assisting
with regards to the 'highly liquid safe asset that would keep it's value until the dust settled' would not a straight purchase of long US or GB bonds be the safest bet at some stage ? i appreciate this has already been thought of in recent months ! |
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no
you would lose money in real terms against inflation |
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but given the current scenario gets much worse is this still not one of the safe plays ? would you not be losing money at a much slower rate compared to other risky options ?
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would not a straight purchase of long US or GB bonds be the safest bet at some stage ?
How exactly do you plan to buy these instruments? They are not what I would consider easy investments for the average retail investor. I'm all ears. |
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And the short answer is NO, that's where the real bubble is at the moment in my opinion, but that's a different debate for a different time. You don't seriously want to lend insolvent Govs, with central banks who seem determined to continue to print money out of thin air at will, at today's yields.
Invest in something a central bank cannot print. I'll let you play join the dots on that one. |
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menalaus is right
you cannot just rock up and buy these types of instruments. They will have a price set by the market (supply/demand) and this will have a big impact on what kind of return your looking at. If the current scenario gets much worse then these are not safe plays. I am sure Menalaus will fill you in on the virtues of precious metals. I personally see value in shares right now. |
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Fair enough guys. I'll file that idea away then.
My next question would have been how best to buy them. Just trying to understand my options here. Appreciate the input. |
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Food
Water Medical supplies Gold (wealth preservation) Silver (bartering) Barter products (ciggies, alcohol, quality chocolate, toilet paper) Probably sounds like i'm just copying Menelaus' list but i've done a lot of research on the Argentinean crisis and there's a blog written by a guy called Ferfal who lived through hyperinflation over there and you'd learn all you need to know. They say those who had chocolate during hyperinflation got all the women! If there's ever a reason to have a stash of Green and Blacks... Ferfal also said it was better to have gold and silver in jewellery form because if you walked into a dealer with coins it would draw unwanted attention. He says people sold off their jewellery by the link to pay for that day's shopping and spent the money minutes after they received it. You learn some interesting stuff. He says the first thing to suffer is services - electric, water etc - and he recommends several torches, head lamps etc with plenty of batteries. I must admit I haven't stashed much in the way of preperation. I have a few tubs of protein powder and various protein bars (from an old diet regime, not bought for this purpose), some silver, a small amount of gold and a year of essential medicine (inhalers and a steroid cream I use occasionally) stashed. I have a lot of things left on the list to get. I'm a little worried about stashing lots of batteries. I can imagine what the police would say if they found them. I'm not sure they'd believe they were innocently bought for use in a torch. |