Thursday , 23 November 2017


With Options So Limited Where Should We Invest?

The fear factor among investors is high with investors unsure just where to put their money. Let’s review the options and come to a conclusion as to where best to invest our cash at this point in time. Words: 402

So says David Urban in paraphrased comments from a recent article* posted on Seeking Alpha.

Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!), has edited the article below for length and clarity – see Editor’s Note at the bottom of the page. This paragraph must be included in any article re-posting to avoid copyright infringement.

Urban goes on to say, in part:

Option #1: European banks? – Not based on the news this week which saw ratings cuts by Moody’s on Italian and Spanish banks.

Option #2: European sovereign debt? Given the risk from a potential Greek exit from the EU and problems in Italy, Spain and Portugal that option is highly unlikely.

Option #3: U.S. banks? Given the recent loss at JPMorgan that calls that strategy into question.

Option #4: U.S. Treasuries? With yields at their present lows they provide what Jim Grant has coined “return-free risk.”

Option #5: European stock markets? Across Europe have fallen as risks from Greece and Spain begin to properly price themselves into the markets.

Option #6: The U.S. markets? They have lagged behind on false hopes that economic growth will be strong enough to decouple from the world but recent economic releases have caused that theory to be rethought.

Option #7: Gold? For more than a decade now gold has provided yearly gains without a loss and while some may state that gold is in a bubble they could not be farther from the truth. A bubble would imply that everyone is rushing out to buy the yellow metal. Even at the peak last summer my local jewelry store had lines of people wanting to sell rather than buy. In contrarian fashion that indicates the bull market is far from over.

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Central banks around the world continue to add to their gold stakes with China, Russia (16.5 tons purchased), Turkey (11.48 tons) and Mexico (16.8 tons) making major purchases during the first quarter. Argentina made its first purchase since 2005 with the Central Bank adding 7 tons.

Conclusion

While we are into a seasonally slow month for gold the downside risk is limited….[so having a good proportion of my portfolio in gold seems like the prudent thing to do at this point in time].

*http://seekingalpha.com/article/600981-nearing-a-bottom-on-gold?source=email_macro_view&ifp=0  (To access the above article please copy the URL and paste it into your browser.)

Editor’s Note: The above article may have been edited ([ ]), abridged (…), and reformatted (including the title, some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. The article’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article.

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Lately analyst after analyst (161 at last count) has been climbing on board the golden wagon with prognostications as to what the parabolic peak price for gold will eventually be. That being said, however, only 51 have been bold enough to include the year in which they think their peak price estimate will occur and they are listed below. Take a look at who is projecting what, by when and why. Words: 644

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With the S&P 500 at its highest level since the summer of 2008, investors previously sidelined by reoccurring fears of a double dip recession and nagging worries about a disorderly Greek default may now be tempted to hold their noses and dive into the market where, presumably, they will be swept along to the land of outsized profits by the Dow 13,000 wave. Having said this, it is worth noting that often the best time to sell is when everyone else is buying. Now may be that time. [Let me explain.] Words: 885

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