Major recession and fallout of the dollar

[zooracer]

Originally Posted by LuxLiving

I think zooracer was trying to reassure himself that he's doing all he can to think thru the situation. It can be frightening. As well prepared and as diversified and as frugal as we are, there are days when the thoughts of what all could go wrong send me back to the drawing board to be sure we've covered all our bases.

Now's probably a good time to re-read that story "Sleep When The Wind Blows". You can probably google and find it on the internet. Yeah, well, maybe two years ago was the right time to read it, but we're where we are at NOW, so go read it now.

Check your plans and consider why you made them. Shore up any weak points. I think this is one reason why keeping some kind of investing journal comes in handy. Five years out you might scratch your head and wonder 'and what was I thinking when I bought XXXX company's stock or this mutual fund or this commodity???'. A quick look back through your investing journal or blog will help you understand it in the scheme of your entire portfolio and life plans. And in light of any looming or 'media-driven' crisis.

Fear can get ugly and feeding it may be fruitful for the writers and people pushing it, but, use it to help you reaffirm your preparations and deploy your assets in a way that will be most useful for your family.

All of the things mentioned sound about right to me. Ya'll forgot a few on my list:

Faith in God to supply NEEDS? Check.
Good Neighbors? Check.
Lotsa Beans? Check.
Physical Gold/Silver? Check.
Defensive Position, Armory & the Food (bullets) that feeds them? Check.
Skillset 4 Survival? (barter, hunt, garden, bake, firstaid, satisfaction & contentment, sew, make-do) Check.
Globally Diversified Portfolio? Check.

I do sleep well at night. BUT, zooracer, I'm with you, I do re-check the latches on the gates and whether it's a good idea to keep something or give it the old heave-ho, whenever the doomsdayers get to trash-talking!!

Make a plan, and work your plan.

I agree with everything you said.
I read the story, and it rings true. Although I am not sure I have as strong of a faith as you (my wife is very religious...I've always been so so), I like the moral of the story.
Be prepared, yet have a little faith in the good of people.

[GrimJack]

I am 100% stocks - I just put 25% into a Vanguard Pacific Rim index (actually about 90% is in index funds with Vanguard and TIAA-CREF, then a little bit in TDAmerica as individual stocks that I picked by accident (a Dogs of the Dow strategy that actually has done me well).

I bought one of those buckets'o'foo from Costco that is supposed to be 3 months supply of foo (only if you kill your own meat), I have a couple of different styles of water cleaners, plus some bottles of water, a block or 2 of life-boat food packets. DW and I have set up a meeting spot. These are more along the lines of what to do for a natural catastrophy but will help out a little if things fall apart.
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[noppenbd]

From Chris Farrell's blog this morning:

Marketplace Money: My Two Cents, by Chris Farrell

[zooracer]

Originally Posted by GrimJack

I am 100% stocks - I just put 25% into a Vanguard Pacific Rim index (actually about 90% is in index funds with Vanguard and TIAA-CREF, then a little bit in TDAmerica as individual stocks that I picked by accident (a Dogs of the Dow strategy that actually has done me well).

I bought one of those buckets'o'foo from Costco that is supposed to be 3 months supply of foo (only if you kill your own meat), I have a couple of different styles of water cleaners, plus some bottles of water, a block or 2 of life-boat food packets. DW and I have set up a meeting spot. These are more along the lines of what to do for a natural catastrophy but will help out a little if things fall apart.
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Yes, there is some really great advice on preparation for a rainy day (or year ) on this site. I'm so glad I found it.
I will check those out at Costco.

I checked with both of my IRA's and they are also diversified into some emerging markets and global investments.
But, my fund manager...who is a really sharp guy...said that they ARE in dollars, of course. He didnt recommend I mess with what I have, but that if I wanted to start another, he would do some things to take advantage of what is going on with the market right now.

With this newest fund, I want to try and do something in a foreign currency...perhaps an asian currency.
What do you think?

Of course, on the other hand...
I'm hearing that the dollar is very bearish right now.

[Broken Arrow]

You know, I really hate to be the one that always rain on people's parades....

However, if you buy with the Dollar (which is weak right now) and buy the Yuan, Euro, or even the Franc (which is strong right now), then, in effect, what you've done is selling LOW (Dollar), and buying HIGH (Yuan, Euro, Franc).

When people mention Forex or even currencies. I tell them that I am indeed investing in it right now. I'm holding Dollars. Because it's weak and I believe that it will rebound in time. One day, when the Dollar is STRONG, THEN, maybe I'll buy some foreign currencies that I think is weak but will rebound in time. Buy LOW, sell HIGH.

Either that or just buy some decent, well-diversified mutual funds. There is nothing wrong in letting arbitrary indices or experienced fund managers to do the investing for you.

[LuxLiving]

Well said, BA!

[GrimJack]

Right on BA - speculating in currency will kill you - When I traveled to Australia in the 1980s, their dollar was at about 50% par with US$ so I opened a savings account paying 15% interest. I sent them a check 6 months later and they charged me a HUGE transaction fee to convert the check. this ate up the dollar difference. When I closed the account they send me a check in Australian dollars and it cost me everything I made to get that in US$. The point is you gotta know what you are doing.

There are office buildings full of people in cubicles making trades in currency; about 8 years ago they found a weakness in an Asian currency and trashed the economy of SE Asia, their economy is only now recovering. The sharks in currency eat the little guys. If you want to invest, pick a no-load fund - I recommend index funds but then I am a middle of the road guy.

[GrimJack]

I probably should not follow my own post but I just remembered back when DW was a usenet goddess and started a sub-group called rec.food.preserving. She built and maintained the faq for a couple years then we moved away and graphics took over the internet and only us old farts remember usenet. But I digress - the point of this post is the address of the faq. If you want to know how to put things by w/o poisoning yourself - check it out:preserving faq

[zooracer]

Originally Posted by Broken Arrow

You know, I really hate to be the one that always rain on people's parades....

However, if you buy with the Dollar (which is weak right now) and buy the Yuan, Euro, or even the Franc (which is strong right now), then, in effect, what you've done is selling LOW (Dollar), and buying HIGH (Yuan, Euro, Franc).

When people mention Forex or even currencies. I tell them that I am indeed investing in it right now. I'm holding Dollars. Because it's weak and I believe that it will rebound in time. One day, when the Dollar is STRONG, THEN, maybe I'll buy some foreign currencies that I think is weak but will rebound in time. Buy LOW, sell HIGH.

Either that or just buy some decent, well-diversified mutual funds. There is nothing wrong in letting arbitrary indices or experienced fund managers to do the investing for you.

Yes, your absolutely right on with that.
I was aware of the fact that I would be buying high and selling low.

What I figured was, I really want SOMETHING in case of a windfall. If the dollar collapses, having some money in foreign currency or gold might be a good thing.

I know, I know...I'm still entertaining the thought of the dollar failing.
But, it is at an all-time low AND we are fixing to go into recession. If both happen, I think even the most experienced investors dont know what will happen.
This is why the Fed is steppin an fetchin right now. The dollar is in a rough spot.

Guess I'll stick with some gold mutual funds...along with a little on hand, as my emergency fund.

thanks for the ideas

[zooracer]

Originally Posted by Broken Arrow

You know, I really hate to be the one that always rain on people's parades....

However, if you buy with the Dollar (which is weak right now) and buy the Yuan, Euro, or even the Franc (which is strong right now), then, in effect, what you've done is selling LOW (Dollar), and buying HIGH (Yuan, Euro, Franc).

When people mention Forex or even currencies. I tell them that I am indeed investing in it right now. I'm holding Dollars. Because it's weak and I believe that it will rebound in time. One day, when the Dollar is STRONG, THEN, maybe I'll buy some foreign currencies that I think is weak but will rebound in time. Buy LOW, sell HIGH.

Either that or just buy some decent, well-diversified mutual funds. There is nothing wrong in letting arbitrary indices or experienced fund managers to do the investing for you.

Another quick question.
When did you buy the dollar on FOREX?
I am thinking also of using a little of my money to invest in the dollar, when/if it comes back.
But, I wasnt going to buy right now, as I think it has more to fall.

What do you think? More to fall?
I'm going to try and time it at the bottom

[Scanner]

I have 33% of my retirement portfolio riding on silver. It's up like 30% in 15 months.

Silver is the poor man's gold.

IMO, 5% isn't enough.

Truthfully, although I am bullish on silver, I wish I had put my money in USO at the time - I would have doubled it.

[Broken Arrow]

While Scanner and I have had our differences, I must agree that if you are bent on preserving your assets, I think a precious metal fund is the way to go.... Scanner and JimOhio can help you with that in further detail.

If you still like currency, I would go with Swiss Francs. They are famous for its stability, whereas the Euro and Yuan may be affected by the US economy.

But, if you are to buy now, let me reiterate that you'll be paying a premium for something that is costing an all-time high right now.

As for the Forex comment, it was tongue-in-cheek. I have yet to participate in Forex because, as an American, I don't have to in order to hold Dollars.

On a more serious note though, I don't recommend timing the market.... Recession is something that is based on at least 2 quarters of market performance... probably even longer if you're waiting for the US government to acknowledge it.

But think it about: By then, we're already well into it! I tell you, the people I know who have "run from the market" did so back in 2006! And it was fine back then because they were at least somewhat ahead of the curve. These same smart group of people, at this point, are JUMPING BACK into the stock market!

True, the market could fall some more as well. I wish I could tell you for sure, but I can't. I don't think anyone can. However, if you must time the market, I recommend to time the present, not the future. And at the present, the US market is soft... in a way that we may already be in a recession and bottoming out. So, I'm full-steam ahead on buying right now.

[zooracer]

thanks again for all the help guys.

I've gained some new ideas and appreciate it all.