Comments on Market Skeptics: The Dying US Economy

"First, the dollar STILL is functioning as the int...

2008-12-24T00:10:00.000-08:00

"First, the dollar STILL is functioning as the international reserve currency, that unto itself is a benefit to holding dollars. If we were talking British pounds Id have a different opinion. So, dollars still function as money internationally. In severe deflation dollars may be worth more than gold at current rates. Finally we live in America, where they use dollars. At very least you can use whatever surplus dollars you have in ANY environment to pay down fixed debt ie. mortgages,fixed home loans, car and consumer loans that are fixed etc."

The beauty of gold is that it does well in BOTH deflation and (hyper) inflation. Check out a long term chart of gold. It is the ultimate crisis hedge. During normal non-crisis time, gold is a poor investment which loses value, but, in periods like today where the world is entering once-in-a-generation economic chaos, nothing can beat the safety of holding physical gold.

"So putting all your eggs in a golden basket is risky. Better to calculate your fixed debt as a percentage of your expenses and keep the appropriate amount of dollars to cover say 12 months of fixed debt servicing (or whatever amount you feel comfortable with.) "

I agree. That is why I said, "right now I advise putting your investment portfolio 75% into gold/silver bullion". By "investment portfolio", I meant money you don't need to cover immediate living expenses.

"The trend currently is with the debtor not the saver. So think about buying hard personal assets too. ie. clothes, shoes, personal hygiene products, tools, rice, pasta, canned meats etc. in at least a 1 year allotement."

I agree. I am personally waiting for gold to break above 1000 before I start stockpiling food. (I believe there will be a small lag between gold prices taking off and the prices of everything starting to rise.)

ONLY "THE TRUTH SHALL SET YOU FREE"- THE GOVT / TH...

2008-12-23T23:59:00.000-08:00

ONLY "THE TRUTH SHALL SET YOU FREE"- THE GOVT / THE FED AND THE TREASURY HAVE MANIPULATED FIGURES / STATISTICS / PRICES TO SUCH AN EXTENT THAT THEY ARE LOST IN THE ALICE'S WONDERLAND. ANY MEANINGFUL RECOVERY CAN BE MADE ONLY WHEN YOU HAVE RIGHT FIGURES; FOR IF YOU DONT KNOW WHERE YOU ARE HOW CAN YOU DRAW A PLAN TO WHERE YOU WANT TO GO ????

Eric is half French so bilingual.

2008-12-23T23:51:00.000-08:00

Eric is half French so bilingual.

Thanks Enrique, The site and bulletins look really...

2008-12-23T23:50:00.000-08:00

Thanks Enrique, The site and bulletins look really interesting.

When I have free time, I might try to look up the full original French LEAP versions (I am fluent in French) to see what is left out of the summaries.

Also, thanks for following my blog!

"I'm having trouble seeing the entire first column...

2008-12-23T23:37:00.001-08:00

"I'm having trouble seeing the entire first column of your blog. Has something changed?"

I found the problem. It was the link in the middle of the article which was messing up the layout. It should be back to normal now.

Eric,I have been visiting your blog frequently dur...

2008-12-23T15:45:00.000-08:00

Eric,

I have been visiting your blog frequently during the last months. Congratullations. For that reason I would like to reccomend you to visit the information published by LEAP (Laboratoire European d'Anticipation Politique)It is a French think-tank that publishes a monthly letter called GEAB (Global Europe Anticipation Bulletin)since 2005. What is interesting is their high degree of prediction. If you read some of the first bulletins from 2005 and 2006 it looks like as if you were reading last week newspapers. What you can see in their web site is only a resume of each bulletin, but it is quite enough. Bulletins are published originally in French and probably translated to English (and Spanish) by a computer translator, so you will find that the quality if the language is not very high.

You can find the list of published bulletins at:
http://www.leap2020.eu/Contents-of-previous-issues_r34.html

Hope you enjoy it.

Regards from Barcelona, Spain

I'm having trouble seeing the entire first column ...

2008-12-23T14:37:00.000-08:00

I'm having trouble seeing the entire first column of your blog. Has something changed?

Ok, I see your argument. However I believe there ...

2008-12-23T14:09:00.000-08:00

Ok, I see your argument. However I believe there is a way to keep dollars for emergencies and in case of the opposite risk which is deflation.

First, the dollar STILL is functioning as the international reserve currency, that unto itself is a benefit to holding dollars. If we were talking British pounds Id have a different opinion. So, dollars still function as money internationally. In severe deflation dollars may be worth more than gold at current rates. Finally we live in America, where they use dollars. At very least you can use whatever surplus dollars you have in ANY environment to pay down fixed debt ie. mortgages,fixed home loans, car and consumer loans that are fixed etc.

So putting all your eggs in a golden basket is risky. Better to calculate your fixed debt as a percentage of your expenses and keep the appropriate amount of dollars to cover say 12 months of fixed debt servicing (or whatever amount you feel comfortable with.)

The trend currently is with the debtor not the saver. So think about buying hard personal assets too. ie. clothes, shoes, personal hygiene products, tools, rice, pasta, canned meats etc. in at least a 1 year allotement.

The rest I would put into gold, commodities and Eastern Asian manufactoring/real estate.