So now what? What sould we do with our investments when the inevitable occurs?

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cohenhs's picture
cohenhs
Status: Member (Offline)
Joined: Oct 25 2011
Posts: 2
So now what? What sould we do with our investments when the inevitable occurs?

OK, I agree long term whether we have dems or repubs in control, nobody will be able to fix the problem with excessive US debt versus US revenue shortfall without crippling the economy in the US.  Eventually, the fed will have to start printing money to pay all the bills.  I don't know if we will see the squeeze on US teasuries in months or years but I feel confident, it will happen.

I'm very heavy right now on insured muni's fund because of the very nice tax free income stream of 6%+ and the relativie saftey of being insured as well well diversified in the funds.  Also, municiple governments usually don't need voter approval to raise property taxes if they need more money.  They almost never default because of this.  That said, if bonds become junk, the muni's will suffer as a similar asset whether it is warranted or not.  Plus, rates and inflation will go through the roof, so 6% won't feel very good at this point.

So here are my questions:

1. What is the first indicator bonds are about to sink and it is time to move my money out the insured Muni funds has arrived?

2. Where do you park your money once the indicators tell us the spiral is about to begin?

 

I would appreciate the thoughts of the community here.

Thanks

Harvey

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