I've been discussing stocks recently (mainly with myself :) and would like your opinion.
I believe, that in the comming economic apocalypse, most/all paper value will return to its intrinzic value (zero). We can all agree, that paper money and bonds will be worthless. What about stocks?
I believe that most stocks will crash, for three reasons: There is no actual wealth or wealth prodcution attached to the stock; the stocks are bloated; trading will stop.
You can sport the first two when purchasing a stock if you do some homework. What about the last one? More then 70% of the trading is done by HFT algos. Once there is a big dip in the market, many of them have emergency breaks put in, which either stops them from trading or dumps all there stocks. Both of which will accelerate a falling stock. But you don't even need HFT algos to envision that scenario. Most of the real people trading stocks (hopefully) have trailing stops or similar. Which also will cause them to dump their stocks, when they start declining.
So why am I bringing this up - if I belive, that stocks are going to plummet like everything else. Well my thoughts are these: If I could invest some money, in say, my neighbours olive oil factory or farmland, that sounds to me like a wise decission. This is actual wealth production, that we will need after a collapse and it will probably be a high value asset then. So doesn't this hold true for stocks in wealth producing companies, that will be needed after a collapse?
What are your opinions?
- Do you own stocks?
- Why/why not?
- Which stocks?
- Do you plan on selling?
- If so when and to whom?
- Is it better to buy wealth production now or wait untill after a collapse?
Divining for the true value of Gold and Silver
Rowe 2016 Seminar Alumni
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Living in the city during peak housing prices