Sunday, September 25, 2016

The Time Is Now?
"Stocks may perform well in the short run as central banks maintain their easy money stance. Once inflation takes off, that tends to be a disastrous environment for stocks because inflation hurts capital formation and new investment. Cash is another good short-term asset because it fights deflation, reduces volatility, and gives you optionality to pivot into other asset classes when the timing of the elite plan becomes more clear. Yet cash will be a bad long-term choice because it suffers the most in inflation. In extreme cases, cash can become worthless. Bonds are just a more volatile form of cash, with a higher yield. Again, bonds are a good short-term play (because of deflation fears) and a bad long-term bet (because inflation is just a matter of time). Some of the best opportunities will be in private equity and technology startups. These have to be carefully selected because the failure rate in startups is high. Gold is the ultimate all-weather play. As shown in this article, gold does well in inflation and in deflation (because government itself will bid up the price). The problem with gold is that it just may not be available when you want it the most. This could be due to simple supply and demand, or governments may try to regulate sales or buy the floating supply for their own reserve positions. The time to get your physical gold is now."
LINK HERE to the essay

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