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I am not sure I agree with you (agreeing with me)...
I do not think the world financial system is a house of cards. (The internet
stocks probably are.)
External events can only present an opportunity for the powers that be in the US
to screw up big time, as they did in the '20s and '30s. In particular, the
isolationist attitude that is common on both sides of the political spectrum is
the most dangerous way to behave.
I grew up in a world where it was considered to have a bit of gold put aside in
case one of the emergencies that seemed to hit the world every 20 years or so
occurred.
The concept still seems sensible, but I am not sure gold, which has absolutely
no value in a service economy, nor can I eat it.
I guess if the world was going to hell in a handbasket, I'd forget about
investments -- I'd want plenty of Spam and a well-equipped arsenal...And I am
anti-gun!
Regards
DanG
George Limberg wrote:
> Dan,
>
> I agree completely....it's a damn shaky house of cards just waiting for the
> first good sized north wind to blow, or for printing ink to be on backorder.
>
> On a larger perspective, I'd be curious as to other RT's ideas on safe
> havens upon whatever the depth of the "apocalypse" is that will befall us
> eventually. What, if anything, will be investment vehicles to ride out the
> impending storm in? A usual answer is government paper since they have never
> defaulted, however, can you really trust this history in the current
> environment, i.e. if everyone rushes for the exits worldwide at around the
> same time? Are there historical investment parallels that can hold water in
> today's picture, or is it time to start using my pen knife and slicing my
> mattress and stuffing it with bank deposits? BTW, my spare room papered with
> old German Marks looks nice when the sun hits the room.
>
> I heard some time ago that the key indicator to watch would be net outflows
> of cash from the US, which would mean foreign money supporting our past
> treasury auctions would be heading back home, but I was surprised to see in
> this thread a small number like 13% of foreign holdings of our debt. I
> thought I recall the number being much higher.
>
> George
>
> >I do have a question about one paragraph of Gitanshu's reply:
> >
> >If the balance sheet of the USA was presented to any banker that just stuck
> to
> >government
> >appointed rules and capital adequacy norms of lending applicable to
> corporate
> >loans or
> >private individual loans, the banker would not loan the US Government any
> money
> >in this state
> >of affairs.
> >
> >I can think of two questions: since the govt can print its own money,
> aren't the
> >normal credit analyses meaningless? and doesn't this sound a lot like the
> >internet stock mergers, where one billion $ company making losses 'prints'
> more
> >stock to take over another billion $ company making losses?
> >
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