[Lazarus Short]

"Y.N." just posted a piece on safe places for your money [not theirs?]. They used the phrase, and I quote, "...extremely safe..." Well, I just have to wonder if they are being straight with us, or are they shilling for the big money powers? They recommended:

CD's [not the music kind]

BANK money market accounts [with banks failing, no less!]

stable-value funds [surely a contradiction in current markets]

money-market funds [with money going crazy]

Are these investments the financial equivalent of comfort food? The old and familiar? Are they just hoping we will all pour our money into these things and prop up the markets just a little longer? Maybe, while they cash out and pack their bags??

Does anyone even know whether to expect deflation or inflation in the near future?

Laz

 

[Navyblue]

A friend of mine who is a financial adviser says that he is at a lost on what to do with his client's and his own money right now. The only way he could see is to put them on on some severely undervalued blue chip shares for long term investment.

 

[kydsid]

Quote:

Originally Posted by Lazarus Short /img/forum/go_quote.gif Does anyone even know whether to expect deflation or inflation in the near future? Laz

Well lets consider that the US government is spending at least 1 TRILLION in Fed Reserve lending to the banks already. Plus the 700 BILLION bailout plan. AND the 25 BILLION Auto industry loan. Consider that government accountants always round up in these situations. So we are about to spend 2 TRILLION or so; deflation is out of the question if you ask me.

The US Deficit is now very close to 10 TRILLION already. That equals about $90,000 for every US family. Do you think Lehman Brothers could write me a CDS for my 90k?



As for your bigger question. Ask yourself this: Of your investment portfolio do you think you will need to use any of that money in the next five years? If so sell some of it and put it in a savings account, preferably high yield. The rest you just need to ride out the downturn. But the options you listed are viable. Just check into the what if's in those accounts.

 

[laxx]

Buy gold.

 

[NoHands]

You could put it in what are considered safe and reputable banks (HSBC Republic, etc) or swiss banks.

 

[JSTpt1022]

Gold, "solid" banks like Citigroup, Chase, HSBC... and

Quote:

Originally Posted by Navyblue /img/forum/go_quote.gif ...some severely undervalued blue chip shares for long term investment.

 

[redshifter]

*sips scotch* *nods* *pats shotgun*

 

[Lazarus Short]

Quote:

Originally Posted by laxx /img/forum/go_quote.gif Buy gold.

I'm finding that gold and silver are rapidly getting hard to find at local dealers, and the dealers are in the same fix. How about elsewhere? Anyone??

Oddly, prices seem too low.

Curiouser and curiouser...

 

[Edwood]

It should be noted that Money Market Banking accounts (the ones you can write checks with) are not the same as Money Market Mutual Funds. Money Market Banking accounts are technically demand savings accounts. They have more restrictions than standard savings or checkings accounts, but afford the same level of insurance protection that other standard accounts have.

 

[mrarroyo]

Quote:

Originally Posted by redshifter /img/forum/go_quote.gif *sips scotch* *nods* *pats shotgun*

Streetsweeper by any chance?

 

[Uncle Erik]

Gold and silver. Brass and lead, preferably jacketed hollowpoints.

Aside from that, I might drop some cash on real estate (

) next month. Nothing expensive and I don't care if it falls in value. Running the numbers, I can make back its value in writeoffs and deductions. Consider tax benefits when you figure your ROI. You might be surprised how something that looks like a loser will pimp your bottom line.

Also dropping small amounts on collectables (

) lately. Aside from audio, I collect a few things and people are dumping stuff at low prices. I'm not rolling big on this stuff, but if we get a stiff round of hyperinflation and the economy perks up, I'll make huge returns. If you know a hobby/collector field well, pick up some bargains if you're not risking your major safe investments and savings.

Laz, I can't help but see deflation in seriously overvalued real property and other investments. On the other hand, the Dollar has been seriously diluted and I can't help but see inflation. I have no idea how that will play out. Though real estate is starting to almost make sense again. When rent covers mortgage, taxes and insurance with some profit, it's at market rate. Some figure based on income levels, but I think rent is the best measure of market worth.

Oh, and might do some securities, too. I've always liked and have invested in utilities, heavy industry and durable goods. Some of those have been unfairly dragged down in this thrashing. Might be time to do some bargain hunting!

 

[Konig]

Quote:

Originally Posted by NoHands /img/forum/go_quote.gif You could put it in what are considered safe and reputable banks (HSBC Republic, etc) or swiss banks.

If i think i know how CDS works i highly doubt HSBC or global swiss investment banks are safe.... HSBC is doing well now because people perceive it to be more of a consumer bank than investment bank, and thus has more deposits to ride out the storm. I argue that that can also compel them to take more risks, and you don't know for sure how they are hiding their losses.

Safe banks to me are mostly Asian banks - hang seng, bank of china, overseas chinese banking corporation that have been very disciplined in the past decade. If those banks go under then I guess its really the end of modern financial system.

 

[Seaside]

As Edwood said, there are two types of money market accounts.
MM saving account is saving account that insured by FDIC. MM fund account is investment account that is not insured by FDIC. Sometimes. the naming can be very confusing, so make sure you ask the bank what exactly it is.

Erik made a good point.
I am not sure about antique. But it is good time to buy a real property in.. not all but some part of this nation, if one can afford all the cost of maintaining the property for few years. Some rich people are purchasing real properties right now like crazy. If the owner of the property is thinking about renting, he must have a regular plan to visit renting property. Some renters just don't care and can made big harm done to the property.

Actually, the deflation in housing price and inflation in other market is two dilemmas that US has. That's odd thing that is not usually happen in other countries. Another odd thing, but somewhat in the same sense, is a phenomenon called double deficit. This happened because the government policy has been very erratic to domestic market, but very responsive when it comes to maintaining strong dollar against foreign currency. US could do that because US is the only one nation in the world that can print dollar. Combined with that, bad mixture of excessive spending, high interest rate, low tax rate, (means government debt) very little regulation in domestic market and huge import from other counties under the name of free trade... (means trade deficit) in other word, stupid government policy brought this strange mess up on us. They were able to afford the mess happened by that policy when the economy can support itself. But... as of now... it will be very interesting to see how they handle this mess, happened and piled up from late 80's.

Well... too much sidelines.

Laz, if i were you, I would split my money to several saving accounts, and invest in real estate if still some money left.

 

[frozenice]

Quote:

Originally Posted by Lazarus Short /img/forum/go_quote.gif Does anyone even know whether to expect deflation or inflation in the near future? Laz

I expect both deflation and hyper-inflation but am not sure which will come first and which will come second - think bungie jumping.

The Canadian banks seem to be in pretty good shape and some of them own smaller banks in the U.S. .

To protect your money I think you have to diversify, say buy a resource stock mutual fund, a global small cap fund, an Asian mutual fund, a precious metal fund and keep plenty of cash (in a bank) and some gold and/or silver coins (safety deposit box). If you buy just one type of investment this market could really turn against you and don't expect all I recommend to do well. It's about the average doing okay and not taking any big hits.

 

[Suntory_Times]

Quote:

Originally Posted by redshifter /img/forum/go_quote.gif *sips scotch* *nods* *pats shotgun*

Hey, that's precisly what i'm doing.