Saturday , 22 October 2016

Systemic Risk Coming Within 5 Years – Here’s How To Protect Your ASSets

A major fund manager has warned investors and savers to have an allocation to “physical cash,” “including  gold & silver” to protect against “systemic risk”…which he foresees as likely to happen in “the next five years rather than ten”.

The above edited excerpts, and those below, come from an article* by Mark O’Byrne ( originally entitled Hold “Physical Cash,” “Including Gold and Silver” To Protect Against “Systemic Risk” – Fidelity which can be read in its entirety HERE.

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Ian Spreadbury, who oversees the investment of over £4 billion of clients money in bond markets as a fund manager for Fidelity, one of the largest mutual fund and investment groups in the world, believes that:

  • the record debt that has been ballooning since the crisis of ’08 is due to interest rates being forced down to near zero by central banks.
  • This debt, particularly where mortgages are concerned, will likely become unsustainable if, and when, rates rise to realistic levels and,
  • in such an environment, banks will be unable to sustain the losses caused by defaults on unserviceable debt which will lead to a systemic crisis….
  • The unravelling is more likely to happen in “the next five years rather than ten”.

To deal with these risks Spreadbury advocates a well diversified portfolio:

  • Cash should be spread out in different banks.
  • Savers should hold physical cash outside the banking system – a remarkable suggestion coming from somebody so well acquainted with the workings of the financial system and he also suggests that
  • investors should hold gold and silver.


Mr Spreadbury concludes:

“The message is diversification. Think about holding other assets. That could mean precious metals, it could mean physical currencies.”


One comment

  1. Lorimer,

    Given the concerted trend to eliminate cash, I totally agree with the fellow you published who suggests that we all should have a stash of cash outside the banks. Canadians should have both Canuck bucks and US dollars in quantities that s/he can afford.

    Where to keep this stash is like where one should keep the precious metals in his possession. Wherever it is, it should never be discussed with any more than two very trusted persons close to him/her.

    Recognizing that US $100 bills are the world’s currency, and knowing that there is about US $ 2 Trillion of it in existence, it will never be removed simply because all outstanding bills can’t be declared obsolete otherwise there would be a global revolution.

    Moreover, most persons with real money and power possess US dollars in quantity. Argentines for example keep them in their safe deposit boxes. These boxes are considered inviolate simply because most rich and powerful persons use them for this purpose as well as to store ill gotten gains.

    Lastly, when the US dollar becomes scarce, a black market will develop in that currency. It will have a higher value than its face value. I think our stash of US $100. bills in our possession, not only will protect us but will turn out to be a great speculative investment.

    Thanks for the post.

    A regular reader.