Strategies Sought for (Near)Collapse -- Without the Hype

[mathjak107]

As far as a bullet proof portfolio goes that should stand up to anything thrown at us, i like the permanent portfolio concept.

With equal parts of cash,gold, a total market fund and long term treasuries its geared to prosper under any of the 4 major economic outcomes.

Recession
inflation
prosperity
depression.

With a segment that responds very strongly when its time comes the mix will more then likely never leave you devastated by any economic events.

Its returned over 9% cagr for almost 35 years now with only 3 slightly down years
Its as boring as watching paint dry as somethings always going up and somethings going down.

I dont expect those kinds of gains going forward with rates so low but i do expect it to to protect the money thats near and dear to me just as it always has.

You can buy

TLT
GLD
VTI
CASH
AND HAVE A VERY NICE PORTFOLIO, just rebalance once a year.

It will always lag in a bull market but its not about getting rich, its about protecting what you have whether from high inflation or the economy sliding into the toilet.

To bad harry brown the creater never lived long enough to see it perform in the melt down in 2008-2009.

So far its past the smell test of high inflation in the 1970's ,again in the 1980's. Its made it through wars , the crash in 1987, 2 back to back recessions with a market meltdown and the almost collapse of the financial system.

to me i cant think of any way better to face uncertainty and not rule out black swan events. In fact it plans for them.

[ragnarkar]

If you're interested, google the "Ron Paul portfolio" which is perfect for your investment views.

Whether it's a smart investment or not is another story..

[eRayP]

Originally Posted by ragnarkar

If you're interested, google the "Ron Paul portfolio" which is perfect for your investment views.

Whether it's a smart investment or not is another story..

Thanks ragnarkar, I didn't think of looking at Ron Pauls portfolio. Ron Paul is betting against the dollar and the way things are going I don't think it's way off. George Soros, a major Obama backer is also betting against the dollar and dumped his stock and bought, I think it was 130 million in gold.

[Philip T]

Originally Posted by High_Plains_Retired

I'm certainly no economic wizard but I think saw this coming a long time ago. I am your age. Having a dad who related his stories of having lived through the Great Depression, at one time I bought the hype of an overnight economic collapse. I now think it will be a significant and long lasting slowdown.

Agree it is long-term. On average, things cannot be better than average. Or else the word would not have any meaning. Things were so excessive the last decade, there has to be some long term down just to balance it. Add that to the possible End of Growth, passing of the Boomers (for US), and it is a whole new game.

As to strategies to weather whatever is coming at us, I managed to get a small retirement annuity but I also bought a small "repo" 20-acre Texas farm for cash I had saved during my working career. We also have a city home in New Mexico with a significant amount of equity that we are still sitting on until my wife retires in two years. I don't know how that story will play out if things really get bad. We also have a small inexpensive rental house here in Texas for supplemental income but I can tell you that being a landlord in a national climate where many renters think all landlords are the evil wealthy is a tough job.

Anyway, my thought with owning real estate right now is that the Feds cannot build a land-printing press but it is a safe bet that the nations borders will remain wide open to many immigrants who will need land.

THe Mexicans have pretty much stopped coming -- part of that rural Texas downturn. Once the excess house building stopped, so did their jobs. They were never coming for the land, just the jobs.

Only folks left to sell off land to now are the Chinese. They are eyeing it, and they play by different rules.

Of course land in here in west Texas is undoubtedly much less expensive than in Pennsylvania so my strategies may not be too helpful for you. I did have a co-worker friend who, a few years ago, moved from the Chadd's Ford area of Pennsylvania to the San Antonio area not that you should consider such a drastic action. At any rate, best of luck in your planning.

Sure, rural Texas has been running negative population growth for decades, now.

That is why it is cheap.

Towards the concept of "survival" if you have water you may do ok.

[Philip T]

Originally Posted by eRayP

If you don't have any intelligent input then don't post. There are plenty of other threads for your comments. The OP has their beliefs and it is smart to think the situation through. There are always winners and losers no matter what the economy and with every change. I am also interested in what others are saying about this.

I am saying the starting the premise that "Obama this or that" is an idiotic frame of reference for the discussion. Romney, et al, would have just looted US faster. Before we start the liberal/conservative retardation -- did not vote for either.

Have been watching the Christian Reich, the MIC, and the Medical Industry all do the same song-and-dance whilst they look for ways to maintain the status quo of looting US, as usual, as well.

If you wish to go deeper you have to look at the larger picture of why things are the way they are now, and how to best cope with that . . . you started into it with this . . . .

Originally Posted by eRayP

2nd trickop, I've also been through the Reagan years and energy squeeze although back then I didn't really understand what was going on other than we waited in long long lines to get gas.

Do you understand it now?

Looking back, I mean?

It is all the same day.

[ragnarkar]

Originally Posted by eRayP

Thanks ragnarkar, I didn't think of looking at Ron Pauls portfolio. Ron Paul is betting against the dollar and the way things are going I don't think it's way off. George Soros, a major Obama backer is also betting against the dollar and dumped his stock and bought, I think it was 130 million in gold.

Once you've familiarized yourself with Ron Paul's portfolio, then I'd suggest looking at the Permanent Portfolio (The Crawling Road and also see Mathjak's post) which is a happy medium between Ron Paul's and what mainstream Financial Advisors suggest. Unfortunately, you'll probably get hosed if you use Ron Paul's portfolio and the economy booms instead of collapsing.. ditto if you use a majority Equity portfolio and the economy collapses.

[LordSquidworth]

Originally Posted by eRayP

2nd trickop, I've also been through the Reagan years and energy squeeze although back then I didn't really understand what was going on other than we waited in long long lines to get gas. I'm not into stock because I think it is too volatile right now. I did buy gold but it is a hedge against inflation but it might take more time for that too happen since our economy is going to get even worse. Silver is and has always been too volatile too. I am reading the the uber rich are buying art which I don't understand but then again you can move it easily unlike real-estate. I'm getting nervous about a 401K because as we both know taxing the rich is not going to be enough to satisfy them so either they will go for higher taxes on the rich like France or they will try to go after the middle class.

I believe they will go after the middle class is it is a much wider base of tax revenues to get from them.

Anyway, back to your question, keep it simple, don't spend unless you absolutely have to. Many of us saw it coming and prepared for Obama's second coming.

They're into art because as countries like china mint millionaires and billionaires, they have an insatiable appetite for art. With the Asians, some pieces that would be thought to fetch 10 million, can fetch 50.

Plus, the right art is irreplaceable, whereas real estate can always be built.

Originally Posted by eRayP

Thanks ragnarkar, I didn't think of looking at Ron Pauls portfolio. Ron Paul is betting against the dollar and the way things are going I don't think it's way off. George Soros, a major Obama backer is also betting against the dollar and dumped his stock and bought, I think it was 130 million in gold.

He still has tons of stock.

$130 million for soros is $100 for Joe Schmoe.

Originally Posted by Hamish Forbes

Why don't you try to refute his argument with factual information and logical analysis rather than resort to name calling like an ignoramus? It would make for a better discussion.

Cause it can't be refuted. Simple google searches present tons of supporting evidence.

Originally Posted by richrf

Today, Bernanke has laid the foundation for excusing his policies as the next recession approaches. He is blaming Congress even though the Federal Reserve has been at the heart of the ruiness economic redistribution of wealth to the top 1% that created the last two bubbles and has created this third and most destructive bubble, i.e. low interest bonds that encourages excessive risk and ludicrous government spending.

What happens when you put an idiot in charge who doesn't believe in reality and doesn't acknowledge bubbles exist, who continues with failed monetary policies that many could have told him would fail.

Oh... And someone who whom barely qualifies, if at all, for his position. His experiences are as a teacher. Nothing more.

[2nd trick op]

Have to ask: Is the name "ragnarkar" based iin part on Ragnar Danneskjold, the "Objectivist Robin Hood" in Atlas Shrugged?

But to move on to another part of the "redistributionist" argument, it's often overlooked that the proportion of the national wealth in the hands of institutions -- everything from college endowments to cemetery perpetual care funds -- is growing rapidly. This wealth "creates jobs", but as everywhere else, the majority of them are on the lower rungs of the economic ladder, as has to be the case. The evolution of "pension fund socialism" is one more feature of the post-industrial age, and even the supposedly enlightened among the present-and-returning Administration acknowege it. They just don't like having to admit it in public.

[DSOs]

Originally Posted by Philip T

THe Mexicans have pretty much stopped coming -- part of that rural Texas downturn. Once the excess house building stopped, so did their jobs. They were never coming for the land, just the jobs.

Only folks left to sell off land to now are the Chinese. They are eyeing it, and they play by different rules.

Good observation. How about PIIG immigrants? These bodies appear to be malleable; which is of paramount importance if the USA decides to continue with the pushing paper/pushing bodies Economy.