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Minyan Mailbag: Hold Onto Your Money


The world is not coming to an end, although it may get pretty bad.

Mr. Practical,

As the global economy continues to trigger warning alarms and as the old "tells" lose their predictive properties, what - or where - should the ordinary investor be putting their dollars? If I recall you moved yourself (both physically and financially) to Japan for this very reason.

As the Mt. Vesuvius of debt shows its early signs of crumbling, what do us mortals do with their hard-earned money? I realize that stocks should be avoided. As well, I will steer clear of most debt. But, what assets classes will perform best? Oddly enough, the U.S. Dollar may outperform -- driven by a dwindling supply of them. As asset prices collapse, dollars are taken out of circulation and the Dollar creation engine stalls out. So, I would imagine that fewer dollars equates to more valuable dollars. Your thoughts?

-Minyan M


Yep, you got it. The relative winners will be those that can hold onto their money. Forget all the financial engineering and Wall-Street tricks (and what the tricksters tell you). Do it the old-fashioned way. Save your money. Get out of debt (sell those stocks and pay off the mortgage with it). Hold treasuries outside of a margin account (if you hold them in a margin account they may get lumped in with the rest of a bank's assets if things get really bad).

The world is not coming to an end, although it may get pretty bad. If you are a relative winner you will have lots of options.

Notice also that the above is much less stressful. It will allow you to spend time with your family and actually listen to what they are saying instead of thinking about what the stock market is doing.

Merry Christmas and Happy Holidays!
-Mr. Practical
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