# Somebody please explain this BS to me.



## Magus

The economy sucks, everybody I know is poor, there are NO jobs, the government is in sequester and the stock market is going through the roof!
Didn't we have this right before the LAST depression?!


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## Elinor0987

Magus said:


> The economy sucks, everybody I know is poor, there are NO jobs, the government is in sequester and the stock market is going through the roof!
> Didn't we have this right before the LAST depression?!


It's another bubble that's about to burst. This article sums it up:

http://theeconomiccollapseblog.com/archives/the-dow-hits-an-all-time-high-translation-a-bubble-is-always-biggest-right-before-it-bursts


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## MetalPrepper

When the fed prints money and adds it to the stock market....it goes up...it is artificial.


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## emilysometimes

The company I work for is hiring and pays well, but people still keep quitting left and right. Or they get fired for hanging up on people they're too lazy to help.


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## Woody

MetalPrepper said:


> When the fed prints money and adds it to the stock market....it goes up...it is artificial.


Correct! And now there is no way to stop it without the system blowing up. The regular folks are not seeing one penny of that 85 BILLION dollars a month the Fed is creating.

It will all have to come to an end, sooner rather than later. The longer it goes on the harder the fall. I have been out of the stock market since I got robbed bad in 2008. Fool me once...

Keep prepping as best as you can. Spring is almost here and soon the gardens will be springing up and producing, giving a bit more cash to prep with.


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## professor

So, what should I move my 403b money into? I can't withdraw it yet - I have it split between 9 different mutual funds. Any advice?


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## labotomi

With rare exceptions, it's better to be stock heavy when interest rates are rising and bond heavy when they're falling. The interest rates have held steady at low rates for a long time eventually they're going to move upwards. Even over the past month rates have been inching upwards. I think rates would have already gone up quite a bit if banks didn't need to get people back in the vacant homes.

Rising rates also means inflation, but I'm not expecting a hyperinflation type scenario unless this BS budget/deficit spending continues. Maybe someone can convince the gov to pull their collective head out of their asses.

Woody, I'm sorry you lost in 2008 but very few didn't take losses. I know of a couple of people who, like you pulled everything out. They still have what they cashed out then while those who stayed the course they were on for some reason or another (hope/ignorance/apathy/stubbornness/some faith in capitalism) have recouped what they lost and possibly gained some.

I had a little warning about my own company's stock value or maybe I just read something into our general managers statement that wasn't there. I moved all of my 401K that was in my company's fund to other less volatile funds and it not only helped because of my company losing 2/3 of it's value, but it also insulated me somewhat from the rest of the free fall. I didn't withdraw anything that was left after the painful slide and started maxing out my 401k and also buying actual stock in my company (they match 10%). It may all vanish if the economy goes to crap, but I'm not ready to bail just yet. I think there's enough ignorance that the gov can keep this going for a few years before the really hard cuts and/or tax increases hit.

I don't want to sound like I'm lecturing, but it's true that _you only have losses when you sell_. 
Why does it seems like people here bring this up when talking about lowering gold prices and bring up the opposite _you only have gains when you sell_ or _it's not real, it's only numbers on paper and computers_ when discussing stocks?

Having said that...I'd love to pack up and move back to our farm, but it's just not economically feasible right now. There's nothing remotely close to that area that will pay 1/2 of my current pay and I still have 2 kids to raise by myself. The youngest is 5 so I'll be here for the foreseeable future.


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## Padre

Magus said:


> The economy sucks, everybody I know is poor, there are NO jobs, the government is in sequester and the stock market is going through the roof!
> Didn't we have this right before the LAST depression?!


I don't think the economy sucks, perhaps government regulation and taxation is putting the "choke" on the engine of growth, and Fed lending is potentially creating an easy money bubble but the fundamentals of the private American economy are good.

Many people are poor or without jobs, because the government is making it scary for employers to hire in the US. I have 9 people working for me, but only three full time, we could really use another 2-3 people working full time or at least more hours a week. More hours means more money for these workers, which I would love to give them, BUT the reality of the ObamaCare "tax" mandate means that if they are employed just a few hours more per week I must offer them health care at about $12k a worker. So if they work 2-3 hours more they get paid a mere $2-4k more a year, and I get the extra couple hours of work a week that I need out of them, HOWEVER in real cost I need to pay them $14-16k more a year for 2-3 hrs of work. That is nearly an hourly rate of about $100 an hour for those three hours!

The danger is not the economy, which is in a precarious place now not because of its own instability but because of the Government, its the government. All the areas of risk are governmental debt, infrastructure, regulation, taxation, currency devaluation, education, etc.

So the explanation is simple the government is PRETTY good at killing people and maintaining basic law and order when it pays attention to these things, but most everything else the government touches turns to dung. And therein lies the explanation to your experience of poverty and the lagging indicator of the stock market.


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## hiwall

Those above are correct that the current soaring stock market is totally because of the Fed's infusion of over 3 trillion dollars. In the space between QE2 and QE3 the market pretty much flat lined while waiting for the Fed to announce QE3. QE3 came out and whoa the wild ride sure sped up!. I think it will go up for awhile yet then look out!


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## nathan

We also get to pay more for products we need (vehicle) as I paid 1500 for my last car in 2008,while A simular Vehicle Now is 5000 +/- in 2013 because cash for clunkers


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## Immolatus

MetalPrepper said:


> When the fed prints money and adds it to the stock market....it goes up...it is artificial.


That pretty much sums it up. 
$ from F3D goes to big banks
they have nowhere else to put it
Plus, and this is a big plus...
most of the trading is done by computers anyway, so theres no real rationale to the market anyway.
So called High Frequency Trading (HFT) accounts for an estimated 70% of the trading on a daily basis. They are computer programs skimming money off the top of every transaction.
These charts are confusing at best, but measure trades in milliseconds, and something called a fantasecond.
The takeaway: computer programs are jamming through thousands of trades in fractions of seconds, screwing with the system to skim money off the top of every trade. Apparently they push a bid through without the intention of an actual purchase to influence the price, then withdraw the bid to drive the price whichever way, then execute their bid (buy/sell), then fill the original bid with the stock they bought in front of the 'real' trade. I think?
Lets try it this way: (Honestly I'm not sure I have this right!)
You put in a bid (to sell) for 100 shrs of XYZ at the market price, say $10/shr. They jam offers through (thousands of bids a second) as fast as possible at say $9.98 to pull the price down. The key is, this is happening faster than anyone can fill, so they can withdraw the bids before they get filled, but it still gets registered by the system and influences the price. They pull the bid, but the market price drops to $9.99 without a trade actually being made. They then buy it at $9.99 and sell to the next bidder back at $10. Its happening so fast that they can get in front of everyone else and skim a penny off the top without anyone being able to jump in.
Again, I think.



professor said:


> So, what should I move my 403b money into? I can't withdraw it yet - I have it split between 9 different mutual funds. Any advice?


Dangerous question to ask anyone, especially a bunch of nutters like us.
I will say at least this. I'm not a fan of mutual funds generally. Our small company was thinking about starting a 401k for the owners (I'm not one, but they asked me to look at the setup) and there were very few choices, and a bunch of the funds mainly _owned a bunch of other funds in the same family._
Ex:
Fidelity (just using the name, I dont remember who it was) fund XYZ was one of the options (of only 4 or 5 total).
Charged whatever fee, lets call it .05% (but coulda been up to 2-3%)
It had 5 holdings:
Fidelity fund ABC, with its own fee of .05%
Fidelity fund DEF, with its own fee of .05%
Fidelity fund GHI, with its own fee of .05%
Etc
Etc.
They would offer a 'break' on the fee if another of their funds owned it and maybe only charge .03% (aint that nice of em!), but the idea was it was multiple built in and hidden (if you didnt look at it and just had an advisor tell you what to buy- "Hey, this ones diversified into US growth and income, and Asia value stocks, whatever) fees.
I aint the smartest guy in the room, but I can smell a rat...



Padre said:


> I don't think the economy sucks,...
> SNIP


I'll agree the gubt is great at getting in the way of the economy.
I'll disagree strongly that the fundamentals of main st. are good. Theres tons of charts out there from the F3D itself that would dispute that; growth in people on food stamps, decline in # of people actually working, decline in real wages, etc.
But my real question is, I thought Ocare only affected companies with 50 or more employees?
Am I reading this wrong?


> The law specifically exempts all firms that have fewer than 50 employees - 96 percent of all firms in the United States or 5.8 million out of 6 million total firms - from any employer responsibility requirements.


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## Magus

Good replies.I think I got it.


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## BillS

professor said:


> So, what should I move my 403b money into? I can't withdraw it yet - I have it split between 9 different mutual funds. Any advice?


Take a loan from it and buy gold or silver.


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## invision

Yup agree with the posters above... The only thing to really add is most of the funds - like the ones mentioned above do own other funds of that investment group, but those funds are typically not managed by them, they outsource the day to day management to other AM firms... Typically the management charge is a fraction of a basis point... But when you have an AM firm managing $80B - that fraction of a basis becomes Millions real fast...

Also, I have said it before, it's only worth what someone is willing to pay for it, and if the market crashes, you still own the same amount of stock, although the implied value might suck, your owning of the stock was not affected... Right now I am trying to convince my dad to cash out of the market... I will give you two examples of his holdings: he bought 500 shares of apple in 1985, he also bought 1000 shares of Exxon in 1971... He has never touched them.... And he doesn't want to... The Implied valuation is multi-millions, if it crashes the implied values could go back to purchase price... He is a stubborn ******* some times... But I am working on him through my mom... Hopefully he will do what I say... He just wants his money to be working for him, not sitting around not making more... I can't get through his thick head that governments (ours especially) creates bubbles - look at 2000, 2007 and now 2013... 

Padre - correct me if I am wrong, but unless you have 50 employees, even under O-care laws, you don't have to offer insurance to full time workers... It will be up to them to get their own and can through Ocare at $600 a year or 2.5% of their gross income - which ever is higher. With that said, outsource your work some... 

For example - I run a managed services and IT consulting firm... I get white shirts all the time from my partners on major projects.... For example, we did a data center migration for a large company a while back, instead of direct hiring 5-8 guys for 6 months or so, I brought in 2 guys from a partner and 2 guys from another partner, and 1 guy from a third... They all knew each other, and while onsite at the customer, they were representing my company... Each had my company's email accounts, etc... I charged the company $135/hr per person, invoiced weekly, net 15 terms, the partners invoiced me at $105/hr per employees invoiced weekly at net 30 terms... So I had enough time to receive AR, and make AP for the staff. Any missed payment in Net 15 caused stop work per contracts, but was never a risk. Since my partners were all either INC or LLC, I had no 1099 labor, and I had no worries on insurance, unemployment, etc... I also had two of my guys onsite at $135/hr and myself as PM at $200/hr. I was making $150/hr free and clear from the partners, $140 and hour from my guys, and $200 for my own time (about 10 hours a week)... Yes, I would have made more with my own guys, but at the end of the project, I would have had to lay off 5 guys... Thus unemployment charges, insurance charges, etc... I believe I made more in the long run doing it this way...

So if you need 2-3 more guys, instead of part timers, find a few companies that can source the work for you.. Your paying an invoice to a company, and avoiding all the BS.


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## Padre

Immolatus said:


> I'll agree the gubt is great at getting in the way of the economy.
> I'll disagree strongly that the fundamentals of main st. are good. Theres tons of charts out there from the F3D itself that would dispute that; growth in people on food stamps, decline in # of people actually working, decline in real wages, etc.


My premise is that all of those things are direct results of government interference. Perhaps its a little tongue in cheek to say the economy is fine, what I mean to say is that there is a continued demand for US goods abroad that is keeping US companies going and that could rekindle the mainstreet economy quickly if the government got out of the way.



> But my real question is, I thought Ocare only affected companies with 50 or more employees?
> Am I reading this wrong?


You are correct. My employer employs hundreds, I manage 9 and have pretty free hiring discretion within my budget. AND one should note this is just one example of uncertainty the government has caused.


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## dixiemama

Why I have no money invested. Call me naive, stupid, whatever, but with the way the stock market is, I don't trust anyone with my money. Hubs and I do have some set back to cover bills and such, and I receive piddling money from property leases. My grandfather lost $14k last year on investments.


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## invision

dixiemama said:


> Why I have no money invested. Call me naive, stupid, whatever, but with the way the stock market is, I don't trust anyone with my money. Hubs and I do have some set back to cover bills and such, and I receive piddling money from property leases. My grandfather lost $14k last year on investments.


He didn't lose unless he sold... That is what most don't understand... Yes his net worth went down, but right now I would harbor a guess he is back up if not higher than last year, unless he sold.


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## BlueShoe

Magus said:


> The economy sucks, everybody I know is poor, there are NO jobs, the government is in sequester and the stock market is going through the roof!
> Didn't we have this right before the LAST depression?!


People I know are doing okay. And the industries I see around are looking for workers at decent pay.



Woody said:


> Correct! And now there is no way to stop it without the system blowing up. The regular folks are not seeing one penny of that 85 BILLION dollars a month the Fed is creating.


I don't know about that. Supposedly the money is buying toxic mortgages from banks. If they weren't doing that what would happen to your home value? what would happen to real estate values across the nation? The fact that they aren't going bust (presently) means the ball can continue to be rolled down the road instead of the economy going full stop. Yeah, it's a bubble, but it's keeping us working for now.



> It will all have to come to an end, sooner rather than later. The longer it goes on the harder the fall. I have been out of the stock market since I got robbed bad in 2008. Fool me once...


My sister lost a million in value in the month of October 2008.



> Keep prepping as best as you can. Spring is almost here and soon the gardens will be springing up and producing, giving a bit more cash to prep with.


Personally, I don't prep. I just keep kicking my own can down the road. eek. i know.


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## invision

tenOC said:


> People I know are doing okay. And the industries I see around are looking for workers at decent pay.
> 
> I don't know about that. Supposedly the money is buying toxic mortgages from banks. If they weren't doing that what would happen to your home value? what would happen to real estate values across the nation? The fact that they aren't going bust (presently) means the ball can continue to be rolled down the road instead of the economy going full stop. Yeah, it's a bubble, but it's keeping us working for now.
> 
> My sister lost a million in value in the month of October 2008.
> 
> Personally, I don't prep. I just keep kicking my own can down the road. eek. i know.


Wow, keeping us working for now,,. What about next week, next month, next year? The sequester isn't a cut, not when we are still going to spend more than we did last year. Let's face it - 1) the fed reserve has created their own debt bubble 2) because the fed reserve is buying debt from the banks and the banks are pumping it into the market, it ties the fed bubble to a potential equity bubble 3) every country that has done this in the past has ended up in a depression. 4) the fed will eventually have to unload this debt back into the market, the inflationary reaction with be negative towards the economy and could or will most likely cause a pop in the bubble. Therefore - expect just that. Now add, that the USD is basically one leg of a 3 legged bar stool - where the Chinese economy is one leg and the EU is the 3rd leg, when one of the legs fail on the stool, the whole stool hits the floor... The same will hold true in this instance.

If your sister really lost a million in value in stock last year, then she needs to sue her investment strategists... With that large of investment portfolio, she should have someone dedicated to her - they should have been able to move her money around with little to low impact to her net worth. My dad's portfolio is much larger than $1MM and even though "I advice him" - he also has a dedicate full time on call manager to assist him, at anytime 24/7....


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## Woody

tenOC said:


> I don't know about that. Supposedly the money is buying toxic mortgages from banks. If they weren't doing that what would happen to your home value? what would happen to real estate values across the nation? The fact that they aren't going bust (presently) means the ball can continue to be rolled down the road instead of the economy going full stop. Yeah, it's a bubble, but it's keeping us working for now.


I personally do not care about the 'value' of my home. I bought something I could afford for a place to live, not as an investment. When the time comes that I have to sell, if it worth more great, if it is not so what? I have had a roof over my head and the price difference is what it cost me to live there. Not everyone is out to try and make a killing on real estate. But, according to the tax man it is worth twice what I paid for it.


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## lazydaisy67

Oh you must be mistaken. MSNBC says 270,000 more jobs in February!!! That brings our unemployment rate down to 7.7% MSNBC knows all the answers...they aren't wrong about anything!!


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## Immolatus

tenOC said:


> I don't know about that. Supposedly the money is buying toxic mortgages from banks. If they weren't doing that what would happen to your home value? what would happen to real estate values across the nation? The fact that they aren't going bust (presently) means the ball can continue to be rolled down the road instead of the economy going full stop.


Please someone correct me if I'm wrong, but this is incorrect.

The *MBS*'s that they are buying have ZERO impact on your home value. Most of them arent even actual mortgages though some are, they are *M*ortgage *B*acked *S*ecurities, not mortgages. Big difference.
Houses in general are overvalued, always in our current system because they are subsidized by the gubt in a myriad of ways. Most (over 90% I believe) morts are held by Freddie and Fannie, and the interest is a tax write off. These are direct subsidies. The sad part is, the fact that mortgages even exist in the first place is a boon to the banks. Who benefits most from us being able to buy a house by getting a loan and writing off the interest? The bank. Its the same as student loans driving up the cost of college education. Gubt subsidies drive up prices. Think about it. If you had to buy a house in cash and morts didnt exist, the price of a house would be waaaay less than it is now because the market couldnt bear it and noone would be able to buy one. Since they do exist, it creates demand for home ownership that wouldnt exist otherwise, which drives up the price.

Back to the F3D buying mortgages. Even if they didnt, that has no impact on your houses value. The morts value is based on two factors. The value of your home/land and whether or not its being paid. The value of the mort is based on the value of the home, not the other way around, because a mort is a loan for $X that has to be paid regardless of the home value.
Lets say I own your mort. If I want to sell it but cant, it doesnt affect the value of your home.
The morts and MBS's that the F3D is buying are essentially worthless. They arent buying up good morts on high value homes that are being paid for. They are buying overvalued homes that the morts arent being paid on. Its a bank bailout, nothing more. The banks bought these securities at $X, then the housing market crashed. The banks were holding the securities on their books still marked at $X and using them as collateral (my net worth is still $X!). When the market crashed (housing values dropped) and people stopped paying their morts, both the mort itself and the MBS became worthless (or just worth a lot less). Since this couldve (according to everyone with a vested interest i.e. the banks who control the gubt and more importantly the F3D) 'crashed the system', the F3D prints money to buy them back from the banks still valued at $X, when they were really only worth $X-90%. This recollateralizes (that might not be a word!) the banks, but doesnt help you or me in a 'direct' way. This effects us indirectly because there is infinitely more 'money' in the system in the form of the bs securities and derivatives in general than there is actual houses and goods/commodities.
I believe the term is (re)hypothecation- using an asset (a house in this example, but paper gold is another) as collateral multiple times. The bank uses the mort itself as an asset on the books, then bundles it into a security to use as another. Poof! More assets! Then it gets a loan on that phantom asset (this is the *re*hypothecation part) ad infinitum, and thats how JPM and BOA end up leveraged 300%, because its value is based on one tiny asset (a house) that turned into millions of dollars of assets all based on financial wizardry.
Its akin to you getting a home equity loan on your paid off house. You then use the loan itself (not the home) as another asset to get another loan over and over.

Whew.
Please if someone can explain this more clearly or correct me, please do. The whole rehypothecation thing makes me a little dizzy.


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## swjohnsey

Lota folks got rich during the great depression. Some folks didn't even notice because they had been struggling just to survive anyway.


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## kappydell

Yes, it did happen right before the Great Depression. Personally, I think the 'professional investors' are fleecing the casual ones, encouraging them to buy right before they quietly pull out. But then again, Im a suspicious type. It just signals me to hurry up and pay off everything I can and put cash away on the QT to tide me over when the banks close.


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## Gians

It's a good idea to have things paid for if you can and of course prepping should be a top priority. If you want to invest, do it only with money you don't need to live on day to day or will need in the near future. Coins are as big a gamble as Stocks and Bonds, they go up and they go down. You'll come out ahead only if you can stay invested until you chose your best time to leave. *Buy low, sell high*...not the opposite.


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## invision

Gians said:


> It's a good idea to have things paid for if you can and of course prepping should be a top priority. If you want to invest, do it only with money you don't need to live on day to day or will need in the near future. Coins are as big a gamble as Stocks and Bonds, they go up and they go down. You'll come out ahead only if you can stay invested until you chose your best time to leave. *Buy low, sell high*...not the opposite.


Although, I agree with your statements of not having much if any debt, and prepping being a top priority, as well as investing with money you don't immediately need (very good common sense)... I am curious as to why you say investing in coins is a big gamble - Every thing goes up and down - Look at the market, interest rates, etc... But when Silver has out performed Gold over last 10 years, and Gold has out performed the market over the last 10 years is where I don't see your point... Right now, we are seeing an all time high in the stock market - but that is being propped up by QE3, as explained in multiple threads, the Fed is holding some $3T in US debt - and even now are considering having to hold it until it matures instead of releasing it back into the market - becuase of potential interest rates shifts - which would cause even greater loss, as well as stopping QE3 will cause the market to flatten and then constrict. So, I think we all agree something is coming that is bad mojo for the US... But even if the SHTF and your response is - you can't eat PMs... let me ask this one... don't you ever see a time of rebuilding after SHTF??? What do you plan to trade? If your trading with a bunch of preppers - then I have a very good supply of bullets, beans, meds, and seeds... So if I have something you need, I am going to be asking for silver or gold...


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## labotomi

invision said:


> Although, I agree with your statements of not having much if any debt, and prepping being a top priority, as well as investing with money you don't immediately need (very good common sense)... I am curious as to why you say investing in coins is a big gamble - Every thing goes up and down - Look at the market, interest rates, etc... But when Silver has out performed Gold over last 10 years, and Gold has out performed the market over the last 10 years is where I don't see your point... Right now, we are seeing an all time high in the stock market - but that is being propped up by QE3, as explained in multiple threads, the Fed is holding some $3T in US debt - and even now are considering having to hold it until it matures instead of releasing it back into the market - becuase of potential interest rates shifts - which would cause even greater loss, as well as stopping QE3 will cause the market to flatten and then constrict. So, I think we all agree something is coming that is bad mojo for the US... But even if the SHTF and your response is - you can't eat PMs... let me ask this one... don't you ever see a time of rebuilding after SHTF??? What do you plan to trade? If your trading with a bunch of preppers - then I have a very good supply of bullets, beans, meds, and seeds... So if I have something you need, I am going to be asking for silver or gold...


PM's didn't beat stocks over the past year, nor did they the during the 80s or 90s. The standard disclaimer is "Past performance is no indication of future growth" applies. Everyone should know not to base your investment decisions on returns that have already happened.

If you think an economic collapse that's beyond recovery is imminent then PMs or hard assest such as land would probably be your best choice. If you think an recoverable collapse is probably, the choices go up. PMs, low risk stocks in companies producing essential goods and services. Usually bonds, but a downturn is usually started from a high interest rate condition which doesn't exist today, so that's probably not a good choice. If you think the can will be kicked down the road for another few years, stocks may be a good choice.

For myself, I'm not buying PMs right now, but I'm not selling either. If prices drop much further, I may consider adding, but I haven't felt the increase in price to the levels they attained was justified. My allocation of investments is shifting to lower risk equities because I still think there are some gains to be had but prefer to be less exposed than I was over the last year to the more volatile companies. I'm taking profits on the companies who's price has skyrocketed to levels I feel are far above their valuations past 5 years.

JMO


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## invision

labotomi said:


> PM's didn't beat stocks over the past year, nor did they the during the 80s or 90s. The standard disclaimer is "Past performance is no indication of future growth" applies. Everyone should know not to base your investment decisions on returns that have already happened.
> 
> JMO


Ok we need to disagree here...history teaches a lot. Let's take a stock... Um WalMart... Looking back can tell you how they handle certain events. It can show you if they have ever made a drastic management mistake, how they recovered, how they worked through this economic condition, etc... I look at trends all the time when making an informed decision... Otherwise your just throwing a dart at a board... I like xyz stock cause they offer a thingy that I think is cool, is not a good investment strategy.

No gold last year did not, but if you compare a 10 year performance them I am correct. I see PMs going down - as long as USD goes up and market keeps going up... Right now it will keep going up until Fed stops QE3... It may not go down either IF the fed holds that debt and keeps it off the books... This means for me, buy... Let them go down... I will keep buying... I do expect the market to come down as little as 40% but more likely 60%... If that happens, then I can't tell you whether the market will be there at all or not... There are way to many variables for the outcome... But I do see a collapse of USD... There is no way we can keep piling on debt without crashing our economy to zero.


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## labotomi

invision said:


> Ok we need to disagree here...history teaches a lot. Let's take a stock... Um WalMart... Looking back can tell you how they handle certain events. It can show you if they have ever made a drastic management mistake, how they recovered, how they worked through this economic condition, etc... I look at trends all the time when making an informed decision... Otherwise your just throwing a dart at a board... I like xyz stock cause they offer a thingy that I think is cool, is not a good investment strategy.
> 
> No gold last year did not, but if you compare a 10 year performance them I am correct. I see PMs going down - as long as USD goes up and market keeps going up... Right now it will keep going up until Fed stops QE3... It may not go down either IF the fed holds that debt and keeps it off the books... This means for me, buy... Let them go down... I will keep buying... I do expect the market to come down as little as 40% but more likely 60%... If that happens, then I can't tell you whether the market will be there at all or not... There are way to many variables for the outcome... But I do see a collapse of USD... There is no way we can keep piling on debt without crashing our economy to zero.


I think you missed my point. You cited that silver and gold had beat the market over the past 10 years... that has no bearing whatsoever on what the next year will bring. The current economic situation and the historical records show what we think will happen based upon previous cycles. I'm simply saying that making investment choices simply upon gains that have already happened is foolhardy, not that looking at history as a whole is wrong.

As for your prediction: you may be right and the market crashes in a few weeks. Conversely the can could be kicked down the road for a while and while your PMs may eventually begin to increase in price, you will have missed some gains in a rising stock market.

I'm not going to disagree with your 40% or 60% prediction. I simply don't know and I don't believe even the best economists know either. There's too many factory to take into account. I don't think a crash is imminent although a correction wouldn't surprise me in the next few months, but like your prediction, mine isn't guaranteed either.


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## invision

labotomi said:


> I think you missed my point. You cited that silver and gold had beat the market over the past 10 years... that has no bearing whatsoever on what the next year will bring. The current economic situation and the historical records show what we think will happen based upon previous cycles. I'm simply saying that making investment choices simply upon gains that have already happened is foolhardy, not that looking at history as a whole is wrong.
> 
> As for your prediction: you may be right and the market crashes in a few weeks. Conversely the can could be kicked down the road for a while and while your PMs may eventually begin to increase in price, you will have missed some gains in a rising stock market.
> 
> I'm not going to disagree with your 40% or 60% prediction. I simply don't know and I don't believe even the best economists know either. There's too many factory to take into account. I don't think a crash is imminent although a correction wouldn't surprise me in the next few months, but like your prediction, mine isn't guaranteed either.


Ok, I see your point in what you are saying. However, in my situation I can't play in the market because of my clients. If I go to buy or sell, I have to get approval from multiple clients due to potential insider information and can be told yes by everyone but 1 and then it is a complete NO GO... So instead of placing money in a blind trust to be managed by a third party -which is an option which I would never do - I invest in either CDs or PMs... Since CDs are a waste of time considering the low interest rates - i was raised on the rule of 72 and 2% interest doesn't cut mustard... so PMs are my only real options at this time. IMO - I think the market right now is going to continue to climb until the Fed shuts down QE3. Yes, their will be 100-150 down days, and 100-150 up days during this time frame. The hard part about choosing stocks in this market is looking for short term climbers and bailing out after a predetermined profit can be made. Example would be when Ford & Bridgestone had those tires explode, and Ford's stock was hit hard... That is a perfect time to buy Ford, because, you and I both know that as the stock hit the basement it was a time to buy buy buy because that stock would recover ground quickly... For PMs, I actually see them trending down more than what they are, if the currency wars continue to heat up, and the dollar climbs in value (even if it is a false valuation IMO) the PMs will shoot down even more 1300-1400 for gold, 18-20 for silver over the next year to year and a half?!? So then as it goes down, it is buy buy buy time. I honestly can't see a time when Gold will be $400 or even $800 again, but i could be wrong... Yet, as we continue down our path of borrowing, continued uncontrolled spending, and printing more and more USD, eventually the USD will implode on itself and be devalued drastically... The signs are there - treasury actually considered meeting a trillion dollar coin, the fed is more than ever unsure of how to unload the $3T in debt it holds and that keeps climbing daily, the government can't create a simple budget in 4 years, etc...

With that said, I can be fairly certain, that I see the markets having major issues in 3-4 years, unless a trigger event happens sooner. You don't have two separate clients' C-level people ask me about moving out of country with them in (now) 3 years... And not have a strong opinion that something big, bad, and ugly is coming... Why would a C-level and major partner in the firm say, I am moving in 4 years, want to come - just because he is retiring and we battle on the poker tables every couple of months?!? Nah, don't think so...


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## BlueShoe

How many of the investors started moving out of the USA in the events around 2008-09? Several, and they were discussing with each other those that were intent on riding out the coming rough times.


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## mojo4

Well I doubt if I have the market backround invision or labotmi have but here is why I pick PM's - the market may rise faster than PM's in a good market but in a collapse PM's retain and probably grow meteorically while stock is worth less than TP. I don't have enough pesos to push around in stocks anyhow. On second thought, don't take stock tips from a broke guy!! Do whatever the heck sounds smart!


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## invision

tenOC said:


> How many of the investors started moving out of the USA in the events around 2008-09? Several, and they were discussing with each other those that were intent on riding out the coming rough times.


There were several that got caught so they had to remain either for QE money, or to make their losses back... Right now, everyone loves the market - you see if on both fox and CNN - now is the time to buy... Sure if you know it is going to keep going up... And it will until the fed stops QE3, then realization will set in... In the mean time the fed now has 3T "off the books" bad debt, and adding $85B a month... Some say until 2014-2015... Getting popcorn, and spooling up the sound tracks for all those early Mr. bubbles commercials.... While they are playing plop plop fizz fizz... But no relief it is....


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## Gians

invision said:


> Although, I agree with your statements of not having much if any debt, and prepping being a top priority, as well as investing with money you don't immediately need (very good common sense)... I am curious as to why you say investing in coins is a big gamble - Every thing goes up and down - Look at the market, interest rates, etc... But when Silver has out performed Gold over last 10 years, and Gold has out performed the market over the last 10 years is where I don't see your point... Right now, we are seeing an all time high in the stock market - but that is being propped up by QE3, as explained in multiple threads, the Fed is holding some $3T in US debt - and even now are considering having to hold it until it matures instead of releasing it back into the market - becuase of potential interest rates shifts - which would cause even greater loss, as well as stopping QE3 will cause the market to flatten and then constrict. So, I think we all agree something is coming that is bad mojo for the US... But even if the SHTF and your response is - you can't eat PMs... let me ask this one... don't you ever see a time of rebuilding after SHTF??? What do you plan to trade? If your trading with a bunch of preppers - then I have a very good supply of bullets, beans, meds, and seeds... So if I have something you need, I am going to be asking for silver or gold...


I didn't really say coins were a big gamble, I said that they are 'as big a gamble' as stocks and bonds. In the 80s I remember Silver taking off like a rocket with Gold not far behind. I also remember writing down Howard Ruff's prediction that Gold would hit $2,000 in a couple years. PMs took a down turn for a long time, even longer than Stocks did after the 2008 collapse. Historically both have had an overall upward projection...but anything can happen. Stocks, Bonds and Cash are really only paper(if that), their only real value is our trust. Gold and Silver are really just rare rocks, you can't eat either :hmmm: so maybe food and the knowledge to grow food is the more foolproof investment.
For trade I have Vodka, Sugar, Salt, Knives, Tools and some knowledge...probably not enough(vodka or knowledge  ) but it's a start.


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## Gravlore

The market is up to its previous highs (in number only). Purchasing power is down on consumer staples, so no real gain. In fact I have read on a number of macro economic sites that state since 2007 the loss of REAL purchasing power is down around 27%. No gain people, just smoke and mirrors. I personally own 0 paper assets. I am 36 and own land and a little metal. If land is ever seized, you can bet your ass that money and the paper that goes with it is worth 0. Food is always in demand yearly so purchase your assets according IMO. Housing and clothing are staples but people can hold out much longer buying those things than they can food. YAY food and YAY land.


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## labotomi

Gravlore said:


> The market is up to its previous highs (in number only). Purchasing power is down on consumer staples, so no real gain. In fact I have read on a number of macro economic sites that state since 2007 the loss of REAL purchasing power is down around 27%. No gain people, just smoke and mirrors. I personally own 0 paper assets. I am 36 and own land and a little metal. If land is ever seized, you can bet your ass that money and the paper that goes with it is worth 0. Food is always in demand yearly so purchase your assets according IMO. Housing and clothing are staples but people can hold out much longer buying those things than they can food. YAY food and YAY land.


How about those who own land metals and invest in the market?

You have your beliefs and have made investments accordingly. It's easy to justify to yourself that you've made the best decisions because you think situation X will occur. Someone else can easily justify their investment choices that are totally different because they believe situation Y will occur. Nobody knows exactly what will occur and to what extent. I know those who frequent these sites mostly expect a collapse of society and thus think anything you don't hold isn't worth anything, but those little things are what bought me the land and metals I own today. I wouldn't have my land or metals without the gains I've made buying and selling stocks over the years.

I could go into an explanation on why I think you should buy this or that, but unless you have the same opinion as me as to what the future holds, you will see it as being foolish.


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## invision

labotomi said:


> How about those who own land metals and invest in the market?
> 
> You have your beliefs and have made investments accordingly. It's easy to justify to yourself that you've made the best decisions because you think situation X will occur. Someone else can easily justify their investment choices that are totally different because they believe situation Y will occur. Nobody knows exactly what will occur and to what extent. I know those who frequent these sites mostly expect a collapse of society and thus think anything you don't hold isn't worth anything, but those little things are what bought me the land and metals I own today. I wouldn't have my land or metals without the gains I've made buying and selling stocks over the years.
> 
> I could go into an explanation on why I think you should buy this or that, but unless you have the same opinion as me as to what the future holds, you will see it as being foolish.


Interested in what you think will happen? Also, yes you hold title to it, but you still pay tax for owning it and the city, county, state, and fed at anytime can say we need your land here take this money, we think it is fair oh and have a nice day. So really, do you actually own it, of have you paid for just the use of that land?


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## labotomi

invision said:


> Interested in what you think will happen? Also, yes you hold title to it, but you still pay tax for owning it and the city, county, state, and fed at anytime can say we need your land here take this money, we think it is fair oh and have a nice day. So really, do you actually own it, of have you paid for just the use of that land?


You probably know way more than I do about investing and are more connected with others in similar situations. I'm not a professional investor by any stretch of the imagination.

I doubt the land I own will be taken unless they're taking everyones land. What I have isn't in an area with strategic value. There's definitely areas better suited for farming and/or raising livestock. It's isolated, rolling hill country that can support quite a few people, but mass production of food isn't economically feasible.

I just as anyone else owning property pay taxes, so if someone look at it as not owning it, then that's up to them. There's a spring on the other side of the property quite a distance from the house that has an output that was enough that the city pays us for the rights to use the water. We get much more from their use of this than we pay in taxes, but their may come a day when they no longer will pay us and continue to use the water, but the spring will become unusable shortly after that happens. A little digging in the right spot makes the water so muddy that it shuts down the filter/pump house until it clears up, more digging will cause sinkholes to form and it won't be useable for a long time. 

As for what I think will happen...
Of course this is my personal opinion and I could be way off, but I think the public is in denial enough to keep pumping their money into the market to keep it inflated for a while. Even the institutional investors aren't imune to this. I don't have an idea of how long it will last. I don't think a collapse is in the near term future 3-5 years and I certainly don't see the momentum of the past year continuing for long. A correction is due and I'm not sure it will rise back to these levels for a while. I know I've stated this earlier, but maybe not in this thread, but I'm moving things around to areas that weren't hit as hard during the last "crash" or "correction" or whatever you want to call what happened at the end of 2008. If a correction occurs, I'll do my best to remain calm. I still buy PMs on a "fairly" regular basis and will probably increase my buying if prices fall back to the low 20s on silver and maybe 1100 to 1200 for gold, but I'll probably never go all in on PMs.

I don't like to talk about unemployment because I don't see what everyone else does. I see the numbers, but I personally don't know of a single person that has become unemployed because of the economy in the last few years. My employer has never laid off a single person due to economic conditions (this goes back 50 years or so). Most people there are paid based on how much is produced or how much profit is made so the wage expense of the company automatically adjusts for economic conditions. If orders are slow, there's not as much being produced and we're not making a lot of profit so everyone takes a pay cut from the CEO down to the lowest person working on the floor.

The other people I associate with are those working for Redstone Arsenal and some of the other farmers near our farm. Those at Redstone aren't affected by the sequester yet as they are mostly engineers who design weapons platforms such as mobile missile launch systems, but they may be affected eventually. The farmers are farmers. Some have enough assets that they don't have to work but still do or those who have always struggled and probably always will. Both of these types are still going about their routines about the same as they were a decade ago.


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## Magus

So basically, I'm not nuts, it is about to crash.


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## Gians

This is a list of causes and durations of some of our 'corrections' in the Market. Seems bubbles, wars, rumors, panic and bad policy have been fairly constant triggers. 
http://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States
I like the 'don't put all your eggs in one basket' investment logic..of course that's after being prepared.


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## invision

And now we will get to see what a run on banks does to euro economy and ours if the situation in greece today spreads to other European countries such as Spain, Italy, and France.... 

I just told wife to move her 401k portfolio away from equities into bonds and other areas- what we did right before 2007-8 crash got below 11,500. 

I am not a professional trader/advisor but i think if euro bank run spreads outside of greece it will trigger a great depression for the whole system over there with germany and GB jumping ship. What it will do here??? That could be the question...


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## Gravlore

labotomi said:


> How about those who own land metals and invest in the market?
> 
> You have your beliefs and have made investments accordingly. It's easy to justify to yourself that you've made the best decisions because you think situation X will occur. Someone else can easily justify their investment choices that are totally different because they believe situation Y will occur. Nobody knows exactly what will occur and to what extent. I know those who frequent these sites mostly expect a collapse of society and thus think anything you don't hold isn't worth anything, but those little things are what bought me the land and metals I own today. I wouldn't have my land or metals without the gains I've made buying and selling stocks over the years.
> 
> I could go into an explanation on why I think you should buy this or that, but unless you have the same opinion as me as to what the future holds, you will see it as being foolish.


"If land is ever seized, you can bet your ass that money and the paper that goes with it is worth 0. Food is always in demand yearly so purchase your assets according IMO."

Noticed I used words like 'if' and 'IMO'.


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## Gravlore

invision said:


> I just told wife to move her 401k portfolio away from equities into bonds and other areas- what we did right before 2007-8 crash got below 11,500.


Not worried about a potential bond bubble?


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## labotomi

Gravlore said:


> *"If land is ever seized, you can bet your ass that money and the paper that goes with it is worth 0. Food is always in demand yearly *so purchase your assets according IMO."


Did I state any different?

Is this or has this ever not been true? It's obvious that if their is a land grab it will come after they grab everything else available. My personal opinion is that a land grab isn't likely so I'm not planning my investments based on one.



Gravlore said:


> Noticed I used words like 'if' and 'IMO'.


Notice that I never said you were wrong. I stated my belief that something else is probably.

I own land. Should I be buying more than I can use? 
I own PMs. Currently the price of metals is decreasing. I'd rather not buy something that will be cheaper at a later date.
I own food. Enough to get me through until the farm can take over. I'm not new to farming, but it's been quite a while. Currently I help when I can on the farm but the return on my time is greater when I'm doing my "job"


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## invision

Gravlore said:


> Not worried about a potential bond bubble?


Absolutely - however, typically when equities fall, the fixed side stays steady or moves advantageously for investors... Not counting on 401k for SHTF, - if we cash then we have a tremendous tax burden... if we borrowed and he company folds or she is left go, then we have a tremendous tax burden... so only counting on 401k for retirement supplement if SHTF never happens. Even if we only go into a depression, the implied value that are in 401ks will be lost for many many years no matter if your in equities or fixed income - especially if a bond bubble bursts while equities fall to the basement. The goal is to keep the implied value of the 401k at or near as high prior to a downturn. Therefore when the market starts the bull run, you have more "buying" power when the funds are low... Thus you gain the most n the rebound.

We did this same shift when the market fell in 07-08, we transferred 100% out when the market fell from 13,000 to 11,500 - then when the market hit the below 8,000 we shifted back to equities.... The implied value of her 401k only lost about $6,000, back in around 7,800 and we saw tremendous gains in that implied value as the DJIA (equities) climbed back into the stratosphere of 14,000.... Almost where she has doubled the implied value prior to the 07-08 crash.


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## LincTex

invision said:


> We did this same shift when the market fell in 07-08, we transferred 100% out when the market fell from 13,000 to 11,500 - then when the market hit the below 8,000 we shifted back to equities.


Thanks!! We need to do this as well!


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## invision

LincTex said:


> Thanks!! We need to do this as well!


Don't take my posts as advise... I am sure holding in equities a while longer could still be gains, and there really isn't anything that isn't risky these days... My disclaimer - I am not a professional, my posts are just my opinions and should not be taken as actual financial advice because I am not trained or certified to give advice on these matters.... Sorry just a little CYA...


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## Gians

I've read that another good time to pull part of your investments out of equities is about 5 years before you plan to retire...unless you're retiring young and are well off financially.


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## LincTex

Gians said:


> ...unless you're retiring young and are well off financially.


Only in my dreams....


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## invision

Gians said:


> I've read that another good time to pull part of your investments out of equities is about 5 years before you plan to retire...unless you're retiring young and are well off financially.


That is more due to retaining wealth... If you have your money in funds that are high risk/greatest reward then absolutely your "risking" your retirement, where as moving them into less risk/lower reward funds have the greatest potential for you to retain that wealth during your approaching retirement.

Look how many who were close to retirement in 2010, who didn't move their money around in their 401ks to less risk or bonds lost the implied value of their retirement portfolios when the market reset in 2007-2008....


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