Sarah A Hoyt has a line attributed to Robert Heinlein, one of my favorite authors, it says “Certainly the game is rigged. Don’t let that stop you; if you don’t bet you can’t win.” This is how I have approached my investment strategy. I know that being purely in physical gold and silver may be the safest bet, but I need a good return on investments to get enough money to build my retreat. I need the magic of compounding Interest to try to achieve an independent homestead.
I believe that the “powers that be” are planning on looting this country so, one thought is figuring out how they are gambling in the billions and trillions and try to duplicate it in a small way, plus make reasonable bets on things you believe in. With that being said, I invested in a bunch of things I believe in, as I realize the entire thing is a Ponzi Scheme, I tried my best to hedge my bets, by investing in other countries and areas that I though could continue to do well without the U.S. My best bets were in gun stocks ans silver, which I invested in two years ago around APR2011. I invested in them because I understood the basics, and even back then I could not buy a gun! I am still waiting for my Ruger hammer-barrel 10/22 target rifle, 8 months and counting. If any one knows Ruger, please ask them “…where is my rifle…” I think they just put the 10/22 behind all of the black rifles. Any way, that bet paid off, so far thank the Lord.
I made a “brilliant” investment before for no other reason than luck and timing (and my guardian angel, who really must be on Prozac and an alcoholic with all I have put him through). I was invested in the stock market and need a down payment for my first house in 1998. Thus I liquidated my 401K savings which was heavily in the market and put it all in the house, then the market crashed in 2001 and the housing bubble took off. I look like a rock star. It was just luck (and my dear guardian angel). It is funny, I may be duplicating that again, again mostly due to timing. I keep a lot of money back in tangibles, but I am also trying to invest in the stock market so I can buy the biggest tangible asset I can, food producing land which I own with independent power and water. This may work again. I still need the magic of compounding interest because I don’t have a lot of assets. However now I am getting close to my goal and thus a little bucket of money and thus nervous. The “system” is now rating RGR as an “F” and SWHC a “D” because they is so over bought, but … I still can’t get my rifle! I invested in the American Redoubt with CDE (silver miner based in Idaho) and BKH coal and electricity producers in Wyoming and Montana. These companies are still rated an A or a B. As long as they keep the lights on in the American Redoubt, which I think they will, that should be a company with earnings of some sort. And my part ownership in them should be worth something.
I know the market will go down, perhaps even crash, either like it did before or worst, I don’t know. There are some people who say you keep a little in the market and as every thing goes down to cents on the dollar you are in a position to keep making regular purchases and your money goes further in buying up companies. When people move money out of emotion there is opportunity, for people who move based on logic. It still feels they are going to loot our nation, or are in the process of looting. That is what the takers did to Britain at the turn of last century and what they be getting ready to do to us. Move all of our manufacturing to China, create a bubble, keep your money on the sidelines, wait until it crashes, and buy America for pennies on the dollar. As Heinlein says, the game is rigged, but you gotta play. There is a song, with lyrics that say “What goes up …” now Jim Cramer (the angry insane, but popular and sometimes funny stock adviser) supposedly sums up where we stand “we all know it’s going to end badly, but in the meantime we can make some money.” This is about right. It sounds just like Sarah Hoyt’s Heinlein quote the game is rigged, but you gotta play. For me, I am going to play until I reach my goal or get wiped out. I think I should be able to reach my goal in a few more months. It is a close thing, I know.
A great book that help me make sense of all of the investments out there is a Random walk down Wall street. My Ivy League buddy shared it with me, we will call him the Nay Sayer, because that is what he is (everything is going to be OK). It basically says the market is … B.S. (completely random), however on average the market has historically gone up regularly for the as long as it has been around. Thus one form of logic says bet what you can afford to loose, spread it around (minimally 60 stocks, better a 100 in different markets) and go back to work. If history holds, eventually you make a reasonable return. The key is eventually. That is why you invest in what you can afford to do without for a time. He constantly presents math, after math of how this is totally random and no one knows what is going to happen, but historically the market has returned this type of average. To me that sounds about right. It is a long book and talks about all the emotional times in history where people have lost every thing, I really love the tulip bulb bubble deal. Right now is gold and silver the new tulip bulb? I don’t know, that is why I like The Survival Podcast recommendation that you keep 10 – 15% of your assets in physical gold or silver. If you cannot because you are investing like me through a 401K, then you may by paper or like I did, invest in miners and streamers, but the best bet is 10-15% in physical gold or silver. This is a hedge, if it all goes to pot, you have a firewall. If gold and silver are the new tulip bulb, you have lost 10-15% of your investments. Gold and silver have crashed previously. What goes up, must come down. To keep your money in “tangibles” there is a lot to do before we need to worry about gold and silver, homes, wells, septic tanks, barns, animals, fencing, guns ammo etc. Even though we don’t know what is going to happen, here are some statics that are unnerving when you are trying to bet how this thing is going to come unraveled.
- Dow Jones Industrial Average: Then 14164.5; Now 14164.5
- Regular Gas Price: Then $2.75; Now $3.73
- GDP Growth: Then +2.5%; Now +1.6%
- Americans Unemployed (in Labor Force): Then 6.7 million; Now 13.2 million
- Americans On Food Stamps: Then 26.9 million; Now 47.69 million
- Size of Fed’s Balance Sheet: Then $0.89 trillion; Now $3.01 trillion
- US Debt as a Percentage of GDP: Then ~38%; Now 74.2%
- US Deficit (LTM): Then $97 billion; Now $975.6 billion
- Total US Debt Oustanding: Then $9.008 trillion; Now $16.43 trillion
- US Household Debt: Then $13.5 trillion; Now 12.87 trillion
- Labor Force Particpation Rate: Then 65.8%; Now 63.6%
- Consumer Confidence: Then 99.5; Now 69.6
- S&P Rating of the US: Then AAA; Now AA+
- VIX: Then 17.5%; Now 14%
- 10 Year Treasury Yield: Then 4.64%; Now 1.89%
- EURUSD: Then 1.4145; Now 1.3050
- Gold: Then $748; Now $1583
- NYSE Average LTM Volume (per day): Then 1.3 billion shares; Now 545 million shares
If I can share one piece of investing logic, it would be Spinning Wheel by Blood, Sweat & Tears released in 1969. Didn’t know this guy was white did you? Well that is ok, I didn’t know either! His voice is very “soulful.” Any way back to investments, what goes around, comes around, what goes up, comes down. That is how the Bard lives. Viva Cristo Rey.
And whoever wants to sue people for simply stating their opinions, I am not smart at any thing, these are just my thoughts not advice. Heck sometimes I wonder why I take advice from myself. Go find someone who knows what they are doing to get advice and sue them.