Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

[goadam1]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

i agree, and it's a bit of a conundrum, trying to figure a relatively safe way to play what looks to be a period of sluggish economic growth, tottering along on a diet of stimulus and extend-and-pretend debt. the best i've been able to come up with is energy and agriculture- commodities which can benefit from growth, can get me out of the dollar into real assets, and benefit from emerging markets in particular. my target allocations [i'm not there yet and might revise these before i am] are currently 35-40% pm's, 20%energy, 10%agriculture, 10% em's/globals/multinationals, with the balance of 20-25% still in cash to be used opportunistically. you?

Me. I've been caught with my pants down on this mess. I built a big cash position from 2006 until now. Waiting. I have about 5% in pm, 20% in some combo of blue chips and multi-nationals (mostly my small business retirement account that has to be passively managed), 5% energy/agriculture and the rest cash (cds, short term tax free munis). Not a great spread. What should I have done? In the Ka I should have bought more metals and dare I say corporate bonds. So the result is those who came of this mind early and sit 30% pms feel pretty okay. I was so caught up in crash mode I missed the boat. I did buy paper gold, some energy and some more blue chips.

[goadam1]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

from what I can see ka-poom is happening.

the ka- already happened -
1. the deflation scare that forced
2. the FED, treasury, congress, president to take extra ordinary measures which
3. prevented a run-away, self-reinforcing / recursive deflation

we're just waiting for
4. very high inflation, short of hyperinflation


IMHO Maybe we'll get another ka-
when Bernanke thinks he can raise rates and we get another deflation scare

add: If there were to be another "ka-" (or maybe several) the final "poom" will be much worse.

I have a feeling poom might be relative. We are in a negative interest rate environment now. Plus taxes are going to be the real poom. I figure at least 10% more in taxes by 2012. So it doesn't take a high inflation rate from there to get poomie or into stagflation. We have $3 gas now and 10% unemployment. Imagine how crushing $4 gas would be or 7% mortgages or no zero money down for flat screens.

[jk]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

Me. I've been caught with my pants down on this mess. I built a big cash position from 2006 until now. Waiting. I have about 5% in pm, 20% in some combo of blue chips and multi-nationals (mostly my small business retirement account that has to be passively managed), 5% energy/agriculture and the rest cash (cds, short term tax free munis). Not a great spread. What should I have done? In the Ka I should have bought more metals and dare I say corporate bonds. So the result is those who came of this mind early and sit 30% pms feel pretty okay. I was so caught up in crash mode I missed the boat. I did buy paper gold, some energy and some more blue chips.

free advice [and worth every penny]: pick your target allocations and start moving in those directions in small steps [0.5-2.5% at a time] whenever you feel anxous about NOT being there, or can muster the nerve.

[Jay]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

from what I can see ka-poom is happening.

the ka- already happened -
1. the deflation scare that forced
2. the FED, treasury, congress, president to take extra ordinary measures which
3. prevented a run-away, self-reinforcing / recursive deflation

we're just waiting for
4. very high inflation, short of hyperinflation


IMHO Maybe we'll get another ka-
when Bernanke thinks he can raise rates and we get another deflation scare

add: If there were to be another "ka-" (or maybe several) the final "poom" will be much worse.

I think most of the rate hike talk is jawboning no matter what has already occurred in Australia. Even when rates finally rise they will be chasing true inflation, and they will be playing catchup for while. Raising rates not only destroys what is left of the labor market, but also increases US debt servicing costs, which is not an insignificant factor. That is a perfect set up for gold. The Fed has been painted into a corner and is playing out the string as long as it can. Rates up and they are screwed; the self-reinforcing recovery is a hail mary pass, so debt will need to be monetized. We may actually get negative rates at some point and our creditors will eventually give up on us. I would think when push comes to shove an emergency meeting is called in secret between all the central banks and they reveal and enact, under threat of global meltdown, their plan. Even if you don't believe this mess is intentional, you have got to give some credence to the possibility of central banks sitting down and forming a currency system which is not necessarily friendly to the sovereign state. Look at the past actions of the IMF and all central banks, what do you think they do if the world economy is in a no-win pickle and comes to them hat in hand? It is not going to be good for Joe Six Pack. I think gold will do well in that environment, the only issue I have is how the central banks play it once the whole world is really in a bind. What do they do with gold? Will they let gold holders sit on their gains?

[Jay]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

free advice [and worth every penny]: pick your target allocations and start moving in those directions in small steps [0.5-2.5% at a time] whenever you feel anxous about NOT being there, or can muster the nerve.

I came about halfway through the party, started lurking in 2006, have played it exactly this way, and it has been working for me. I keep taking slow to medium steps and reorganize every month or so.

[Jay]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

The best "investment" you can currently make is to obtain citizenship in a civilized country and have an escape plan.

I always wonder about those with this sentiment. It strikes me as escapist and depressing. Do you have no family, no friends, no community? I am here in the US for the long haul. I'm going to play it as well as I can financially, while living amongst my friends and family. I hope wherever you run to the grass is greener.

[Spartacus]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

Spartacus - Just my two cents, but if you were any more arch in your (uncannily infallible!) identification of all the knee jerk time-wasters among us, you'd be bending over into a pretzel.

heh ... I wasn't trying to be cute ... names not needed as I feel no need to explicitly insult anyone

Besides, no one that I plonked for that particular reason is still posting here (they may be reading of course)

[cjppjc]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

Spartacus - Just my two cents, but if you were any more arch in your (uncannily infallible!) identification of all the knee jerk time-wasters among us, you'd be bending over into a pretzel.

heh ... I wasn't trying to be cute ... names not needed as I feel no need to explicitly insult anyone

Besides, no one that I plonked for that particular reason is still posting here (they may be reading of course)

You couldn't make this up.

[Jay]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

You couldn't make this up.

I'm trying to stay out of it, but it sucks me in! I just deleted a smarmy reply to this thread about 30 minutes ago but you tempt me cjppjc! ;)

[cjppjc]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

I'm trying to stay out of it, but it sucks me in! I just deleted a smarmy reply to this thread about 30 minutes ago but you tempt me cjppjc! ;)

You certainly show more restraint than I do. The best is earlier predictions are turning out well. And Nero3 with his sugar and railroad calls is no longer heard from.

[Spartacus]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

You couldn't make this up.

Looks like I've unwittingly made a joke. Or was my attempt at not naming names too convoluted & twisted? (and everyone thinks they know the names anyway). I can be dense sometimes, especially when sleep deprived.

I hope I'm not its butt.

Anyone want to clue me in?

[jiimbergin]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

Me. I've been caught with my pants down on this mess. I built a big cash position from 2006 until now. Waiting. I have about 5% in pm, 20% in some combo of blue chips and multi-nationals (mostly my small business retirement account that has to be passively managed), 5% energy/agriculture and the rest cash (cds, short term tax free munis). Not a great spread. What should I have done? In the Ka I should have bought more metals and dare I say corporate bonds. So the result is those who came of this mind early and sit 30% pms feel pretty okay. I was so caught up in crash mode I missed the boat. I did buy paper gold, some energy and some more blue chips.

I also came in late (I did have a small amount of gold and junk silver left from the late 70s that I never sold), but I have managed to get up to about 40% of my net worth (not counting my real estate) in pm. Only about 12% in physical, the rest in GTU and CEF. I have an additional 10% in GLD and SLV for trading purposes. I keep buying physical often, in fact some just arrived today from APMEX. I am sure I will be buying more physical in the next few days.

[Chris Coles]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

Please stop with the "inflation is showing up in the quality of food and restaurant meals". This is the most bizarre assertion I have ever heard regarding inflation and it is also the opposite of what is occurring. Do you ever shop? Every store in the country is having the equivalent of a going out of business sale. The prices on literally every item I can think of is savagely discounted and I have yet to see ONE credible story of reduced quality from yourself or an Itulip member.

Well I call: My experience here in the UK is that reduced quality is exactly what is happening. Sainsbury's are an excellent example. Their "Greens" now come in the same package but with about 20% less cabbage in the pack. (for example). I could list many examples. I live alone for the time being and have to do all my own shopping. Reduction in quality, or quantity is happening all through the food industry. My first instance was Turkey burgers, that I used to like with 56% turkey, but when they reduced the turkey to 42% and removed the fresh herbs and replaced them with chemical taste effects I went right off them and have not returned again. Moreover, the manufacturer has moved the entire production facility to Poland and foisted their new product on them as something new to be enjoyed. Poor sods, they too will have a shock when the burgers end up with 30% turkey....

I can only speak for myself, but where I am, today, there are many signs of lower quality or quantity throughout the food industry.

[ThePythonicCow]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

Anyone want to clue me in?

Sorry, mate. There seems to be a world-wide clue shortage. I'm suffering from it here as well.

[Jaminon]

Re: Asylum Markets of the post FIRE Economy – Part I: Locked Up - Eric Janszen

Long time listener first time caller... I am UK based and now finally able to take some modest positions and have a couple of questions; Gold: Is this a level ($1134) still worth getting in at? If yes, what is the best ETF to use? What’s a good percentage for gold in a portfolio?
RMBY exposure/Chinese bonds, seem like a good idea? Any other happy thoughts towards building a portfolio today? Many thanks