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Advisor

All bets now off

Dornbush's Law (about currency crises) says that things can go on status quo for longer than you think possible, then the crisis hits fast and hard.

We've now entered into a monumental constitutional crisis, which will drag on for months, or longer, and get worse almost every day.

Even spotless minds who can say "what's the big deal?" will be significantly affected.

At this point I'm considerably more worried for the country than my pocketbook, although I've take steps to try to limit my exposure. 

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8 Replies
Honored Advisor

Re: All bets now off

Care to elaborate on your "steps"?

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Advisor

Re: All bets now off

Mostly moved to cash in late '17 as I concluded that the market had more than fully discounted the tax cuts and any real prospect for growth. Since then the market has gone nowhere- but in an interesting way (that's how they keep you hooked). 

Wish I'd been smart enough to go into long bonds but sure didn't see that one coming with the burgeoning deficit spending.

And generally have just avoided lavish spending of the modest windfall. No debts to speak of, and some cash.

Also missed the move in gold. I'm still way ahead from selling mine in '11, but always wanted to buy it back. Looks like I missed that.

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Highlighted
Veteran Contributor

Re: All bets now off

Missed the move in gold it is just over $1500 the high is over $2000 if there is a currency crisis to come gold will go much higher. Buy silver or Platinum that will work

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Veteran Advisor

Re: All bets now off

Just curious, what's the best source and method to "buy gold", in order to have ownership in the commodity without the added risks of mining/mismanagement?

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Veteran Contributor

Re: All bets now off

If you can't hold it in your hand, do you really own it?  

 

APMEX.com out of Oklahoma City has been a reliable buyer and seller, and they can store it for you if you don't have a gun safe or other secure storage (don't use a safe deposit box at the bank!).

 

Also, look at the pre-1933 gold coins too. The St. Gaudens double-eagles are beautiful and at times you can get MS-64 or even MS-65 for less than $100 over spot. I like those.

 

If you go with silver, remember that it is more volatile.  In the last boom, gold went from $600 to $1900 (3x) then back down to $1000.  Silver went from $8 to almost $50 (6x) then back down to $13.

Honored Advisor

Re: All bets now off

http://www.coin-rare.com

Left menu bar has what ever flavor of gold or silver product that trips your trigger.

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Advisor

Re: All bets now off

I'm basically a deflationist by inclination.

$T's of inflated assets supported by $T's of debt and mega $T's of derivatives.

Throughout history, in a deflation the senior currency has always benefited- it would be like a short squeeze on the USD.

The inflationist theory assumes government can respond fast enough to save the debtors.

This government? What government?

Anyway, I'm talking an unprecedented political crisis here, at least first. Financial crisis could begin with that, come later.

The Great Turning is upon us. Social, political, economic.

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Advisor

Re: All bets now off

Whatever discontents folks of any stripe were feeling, well OK.

The compost is coming in contact with the propeller.

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