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Wealth hoarding would be useless in an inflationary spiral. It would be hard to wait out the hard times you lives through. Things change, f you can see the downturn coming. then, you've got a shot at hoarding enough assets to help ameliorate/lessen your discomfort.
Originally posted by donwhite
The other day I heard someone say that in 1990 there were 9 million (American) people in “the market.” A loose term encompassing all the private “investment” markets. The NYSE. Nasdaq. OTC. Stocks. Bonds. Mutual funds. Retirement funds. Private retirement accounts. Add to that what we call HEDGE funds and now the newest, SOVEREIGN WEALTH funds. George W Bush - known to his friends as DUMBYA - tried to add the $3 trillion Social Security Trust funds to that MIX. Fortunately for ALL Americans he failed.
The speaker went on to say in 2005 there were 96 million Americans in "the market." A 10 fold increase in just 25 years. And I’d wager 99.44% of those GOOD Americans think - hope - believe - trust - that someone, somewhere is "watching over" their money and the money-handlers on whose corporate honesty and personal integrity the security of their retirement depends. But you who read me much at ATS know already what I am about to say:
NOPE, there’s not ONE dam agency assigned the responsibility of keeping your BROKER honest. Or fair. Or reasonable. Or are requiring insurance to cover YOUR loses should your broker or his boss decide to take your money and go off to Costa Rica. Like the swindler Robert Vesco. (He died November 23, 2007 in Cuba at age 72. He stole about $125 million).
But that is the fault of the 96 million savers who think they are investing. There is a big difference. But personal greed, ignorance of the laws and unrealistic hope all work to put their money at risk. What was once called "selling the blue sky" in the 1890s when we had a similar rush to buy anything labeled a bond is here again. Here on ATS there is an ad "34 stocks that doubled." Of course, the ad never tells you about the 68 stocks that HALVED. Remember for every buyer there must be a seller. One guy who thinks his stock has peaked and the other guy who thinks it has further to go.
Oh sure, it is still against the law to steal another’s money. But “stealing” in mutual funds is not easy to prove. Insider trading is rampant - IMO - and who is to say your losses were not just due to the vicissitudes of the market place? After all, for every winner there must perforce be a loser. Or to be blunt: Prove it!
Mutual funds. Load or no-load. Upside: Been around for years. Downside: The fund managers are paid based on "TRANSACTIONS."
2 years ago the fund managers recommended a buy GM. So they sold their Chrysler stock and bought GM. TWO transactions! Now $4 gasoline in 2008 makes GM look bad. Too many SUVs. SELL GM and BUY Toyota and Honda. TWO more TRANSACTIONS. Shucks, YOU lose but I WIN every time! Aside: I have known one fellow who made a lot in the "market." He had this rule: Buy only good stocks and NEVER sell. After 30 years all his mistakes had fixed themselves.
Sweet Jesus, how do I get one of those manager jobs? What tests must I pass? What must I know? What background vetting do I get? Do I have to agree to take a polygraph every 6 months like the CIA or NSA workers? Do I have to buy a personal BOND? Answer: NONE of the above.
I really hope you are not disappointed when you reach 62 years of age and expect to "chuck it in" for the sunshine and clean beaches of the Virgin Islands and to live life on the easy side. We KNOW how to cure this open gapping sore, this invitation to commit fraud. On a scale never before imagined. But will we?
I had a chance encounter with a fellow today who said he was going to buy some gold and some silver. Seems that he is interested in hedging his bets agiasnt what is coming. If we accept tht more than one big name bank will fail by the end of this year, it may be wise to think about WHERE your saving account is.
So far as I know, the FDIC and FSLIC only pay ten cents on the dollar, and they can take up to 99 years to pay. If memory serves, that's been talked about here on ATS many times.
Originally posted by donwhite
NO DEPOSITOR HAS EVER LOST A PENNY IN AN INSURED INSTITUTION SINCE 1933.
[edit on 7/10/2008 by donwhite]
Banking is a risk adverse field. As a result it can be insured with little beureacracy, effort, or downside. Investing is by definition a form of risk taking The two industires are not analagous in this respect, and can not be treated as if they were. This is a very basic concept. Surely you can uderstand this?
Let me post my priority list here, again.
1. Paying off your plastic is never a bad thing . . a blank credit card.
2. . . try to keep 30 days of operating capitoal on hand . . just enough cash to do what you normally do for one month.
3. . . make sure you are diversified.
4. . . firearms can be purchases from private individuals. Paying wish cash eliminates all paper trails. Just be aware that you risk buying a stolen gun, which can land you in jail IF that weapon was used in a crime.
5. Don't plan on a Bunker Strategy. Never forget that the authorities and hungry mobs will be looking for hoarders, when things get very bad.