How to Invest ?

[70AMX]

Originally Posted by MarkJ

Always buy when everyone is telling you not to. Always sell when everyone is telling you someing will go up.

IMHO Stocks have been overbought so they are coming off for a time. A good moment to buy.
Gold is vastly over priced and many who have been holding gold for a while (its often a long term hold) will be moving to crystalize their profit.

I am afraid that you have normalcy bias, you believe that things will always go back to the normal that you know........well we are in uncharted waters and the future of our debts is already written....already spent.....already defaulted on....just not realized yet.

From Wikipedia
The normalcy bias refers to a mental state people enter when facing a disaster. It causes people to underestimate both the possibility of a disaster occurring and its possible effects. This often results in situations where people fail to adequately prepare for a disaster, and on a larger scale, the failure of the government to include the populace in its disaster preparations. The assumption that is made in the case of the normalcy bias is that since a disaster never has occurred then it never will occur. It also results in the inability of people to cope with a disaster once it occurs. People with a normalcy bias have difficulties reacting to something they have not experienced before.[citation needed] People also tend to interpret warnings in the most optimistic way possible, seizing on any ambiguities to infer a less serious situation.

[70AMX]

Originally Posted by smurphny

It's interesting to think about the number of dollars available in the entire financial system and its correlation to inflation. When trillions evaporate as they did today, where do those paperbacks go? I think they just...well...evaporate from the total. No matter how many dollars are "printed" many just disappear in lousy financial times, never to be heard of again. So when the fed floods the system with more money (in one form or another) does it create devaluation? Are there really more dollars chasing the same number of assets as you would visualize logically, creating inflation? I don't have a good understanding of the mechanics of this and it seems no one really knows for sure what the effects of this kind of policy has in the long run. Most of the experts and pundits hem and haw when they are asked this question.

That would be a good question to ask Jim Sinclair @ jsmineset.com he is not accepting emails but his facebook page might have an answer for you. JSMineset’s official group, located at Welcome to Facebook - Log In, Sign Up or Learn More

[MarkJ]

Originally Posted by 70AMX

well we are in uncharted waters and the future of our debts is already written

No, mate. I am in Charted waters. I am cruising.
You are in Uncharted waters. You're still at home.

[Capt Phil]

Think I found the perfect investment! Sent my wife (25 years my junior) to medical school... graduates in less than a year, portable skill set, transferable credentials, good pay and she loves the work... Happy Wife=Happy Life... cheers, Capt Phil

[70AMX]

Originally Posted by MarkJ

No, mate. I am in Charted waters. I am cruising.
You are in Uncharted waters. You're still at home.

Point taken, now you made me cry......

I envy the freedom you possess and I can only dream about....for the time being anyway...

[70AMX]

Originally Posted by Capt Phil

Think I found the perfect investment! Sent my wife (25 years my junior) to medical school... graduates in less than a year, portable skill set, transferable credentials, good pay and she loves the work... Happy Wife=Happy Life... cheers, Capt Phil

Good Catch!

[capngeo]

So we are going to be seeing Swan 60’s over in the $500/month thread?

[70AMX]

Originally Posted by capngeo

So we are going to be seeing Swan 60’s over in the $500/month thread?

There will always be rich people in the world, it is the middle/upper middle/baby rich classes that are going away, those are the toys that will and in some cases already are in a fantastic buyers market.......just look at the collector car market right now, the cars that the middle class could afford to buy are for sale with nothing but low-ball offers, here is a search of craigslist Minneapolis for chevelle and 112 collector cars for sale came up. Toys are being liquidated....... minneapolis cars & trucks - by owner classifieds "chevelle" - craigslist

Your Swan 60 would probably cost $500 a month to clean, but I bet you will find them for sale in a year or so for .75 cents on the dollar.

[VirtualVagabond]

Originally Posted by Capt Phil

Think I found the perfect investment! Sent my wife (25 years my junior) to medical school... graduates in less than a year, portable skill set, transferable credentials, good pay and she loves the work... Happy Wife=Happy Life... cheers, Capt Phil

Child slavery rules

[Cheechako]

After riding the "Buy and Hold" recommendations for 30 years and gaining and then losing it in each recession.... I finally got smart. Get in the market when it's low. Set a goal at that time..... say 30%... get out into fixed income when you get there...regardless if the market is going gangbusters. I missed the 2008 debacle with this strategy and got out 2 weeks ago also. NEVER listen to brokers. All week, the news machine has been telling you to not sell. If you got out a week ago you would be big money ahead.
At some point you have to take a profit! Otherwise you'd be like a store that just buys inventory and never sells.!

[MarkSF]

Originally Posted by 70AMX

I am afraid that you have normalcy bias, you believe that things will always go back to the normal that you know........well we are in uncharted waters and the future of our debts is already written....already spent.....already defaulted on....just not realized yet.

From Wikipedia
The normalcy bias refers to a mental state people enter when facing a disaster. It causes people to underestimate both the possibility of a disaster occurring and its possible effects. This often results in situations where people fail to adequately prepare for a disaster, and on a larger scale, the failure of the government to include the populace in its disaster preparations. The assumption that is made in the case of the normalcy bias is that since a disaster never has occurred then it never will occur. It also results in the inability of people to cope with a disaster once it occurs. People with a normalcy bias have difficulties reacting to something they have not experienced before.[citation needed] People also tend to interpret warnings in the most optimistic way possible, seizing on any ambiguities to infer a less serious situation.

As an investor, I'm fundamentally a contrarian. This puts me in the same camp as two phenomenally successful investors, Warren Buffett and George Soros. As Buffett said (from memory) "to buy when everyone else is selling and to sell when everyone else is buying takes the greatest strength of mind, but offers the greatest long term return".

The stock market is dominated by groupthink. There are periods of irrational exuberance, irrational negativity, and times when the two are in balance. I hear all those sentiments about the national debt, about the economy, about the end of the US as a power, and to me they all look like negative groupthink.

So while everyone is panicking and the stock market plummets I'll be happily buying up stocks of great companies like GE. P/E ratio of 12 now, 3.6% a year dividend.

I remember trying to convince a colleague that it was a great time to buy stocks, when the DJIA hit a low of 6000ish. He looked at me like I was mad. He reads all the same reports, news, and blogs you do and had just SOLD his stocks and bought gold. Hmmmm.

[70AMX]

Originally Posted by MarkSF

The stock market is dominated by groupthink. There are periods of irrational exuberance, irrational negativity, and times when the two are in balance. I hear all those sentiments about the national debt, about the economy, about the end of the US as a power, and to me they all look like negative groupthink.

So while everyone is panicking and the stock market plummets I'll be happily buying up stocks of great companies like GE. P/E ratio of 12 now, 3.6% a year dividend.

I am pretty sure that the DJIA is negative for the year isn't it?
A great company like GE? Are you not worried about GE's exposure to derivatives and their exposure to the credit markets they control like in Australia and the fact that they took 140 billion in tarp money last time...... if you are not......well that is your decision...but just like BOA they can go down very fast. Negative groupthink... are you kidding me.....when bernanke says that Gold is not money and we will never be downgraded you have to ask....are the powers that be telling the truth.....and did you miss the partial audit of the fed that showed that they lent 16 trillion all over the world to stop the meltdown last time.....our whole nations debt is 14 trillion....so the fed created 16 trillion to save us then......and it kicked the can down the road until now....maybe the fed can create 32 trillion this time and kick the can for 6 months more,but I doubt it. You can keep your contrarian investment methods but both Buffet and Soros own huge amounts of Gold and Silver. The fact that the national debt can never be paid off is rooted in mathematics and you can't change math either.

The REAL Problem With The Downgrade

Snippit from Karl Denninger: But if the banks threaten to blow again due to capital problems there is no ability to save them this time and you will lose your deposit money as the FDIC has no money and Treasury cannot borrow enough with the debt limits in the way to save even one of these monster banks, say much less all of them.


Or Greg Hunter's "Brace for Impact"
The kind of impact we are going to have will not be like flying into the side of a mountain. It will be the kind of crash that skids over land, clipping trees and buildings until the plane ends up wingless in a smoldering heap. I just hope the fuel tanks don’t ignite when the long rough ride is over.
Economic Collapse: Brace for Impact! | Greg Hunter

Normalcy Bias can ruin your life.

[capngeo]

I wonder about all those buying gold.... Unless it is ACTUALLY PHYSICALLY IN YOUR POSESSION isn't it just another paper promise? I mean (to my simplified financial mind) it's not unlike buying oil or pork bellies..... I mean do you REALLY own it? Or is there some dude graciously "holding" it for you, and giving you a piece of paper SAYING you own it? I have a little gold and silver, but it's all in coin and in my possession. I would imagine even my meager net worth would have portability and security issues if it were all gold and silver.

[70AMX]

Originally Posted by capngeo

I wonder about all those buying gold.... Unless it is ACTUALLY PHYSICALLY IN YOUR POSESSION isn't it just another paper promise? I mean (to my simplified financial mind) it's not unlike buying oil or pork bellies..... I mean do you REALLY own it? Or is there some dude graciously "holding" it for you, and giving you a piece of paper SAYING you own it? I have a little gold and silver, but it's all in coin and in my possession. I would imagine even my meager net worth would have portability and security issues if it were all gold and silver.

You are quite right, paper Gold isn't worth the paper it is written on.
Physical Gold and Silver in YOUR POSSESSION is the only safe bet....$300,000.00 worth of gold will fit in a shoebox and a shoebox is pretty portable. I hear that many people lose it in a boating accident......many people will bury it, if worried about metal detectors they bury 6 feet down (post hole digger) and noone will ever find it.

[avb3]

Originally Posted by Capt Phil

Think I found the perfect investment! Sent my wife (25 years my junior) to medical school... graduates in less than a year, portable skill set, transferable credentials, good pay and she loves the work... Happy Wife=Happy Life... cheers, Capt Phil

You dirty dog you. My GF is only 18 years my junior. This time I don't have to worry about alimony cause I live in a non-palimony jurisdiction