I’m conflicted about this market.
On one hand, I would of course prefer a return to normalcy. When times are normal, you can buy stocks and bonds, and if you hold them long enough you’ll make an acceptable return.
You can even buy CDs and get 5-6% – which is a nice return for not trying very hard.
But we’re not in normal times.
And so we can’t just buy the usual investments and be satisfied with 5-10% returns.
Because even "reliable" investments like bonds simply aren’t paying. CDs are a joke.
These are strange, uncertain times to be an investor.
But on the other hand, uncertainty forces my hand. There’s no question that I should probably avoid most stocks. There’s too much market risk. By market risk, I mean – there are too many outside variables with the potential to utterly crush most publicly traded companies. Whether it’s inflation, or debt crisis, or currency crisis, war, energy scarcity, environmental concerns, disaster, corruption – there’s so much potential bad news.
With a volatile stock market and no-yielding "safe" securities, I’m forced to sit in different forms of cash. That’s why I own physical gold and silver. It’s why I own some Canadian dollars. It’s why I have another large chunk of my portfolio in cash equivalents (like short term bonds that can be liquidated at par on short notice.)
It’s why I ignore most stock teases. And this ability to focus on the commodity asset class as well as simple cash holdings gives me freedom. I don’t have to worry about the broad stock market so much. I don’t have to watch a basket of holdings and monitor stop-losses.
I only have to sit and wait – buying gold and silver when I’m able – waiting for things to return to normal.
I’m waiting for the overwhelming likelihood that a serious currency/debt/war crisis will wipe out most stocks so that I can buy them for multi-decade low prices.
IF you say to yourself "I can’t afford to be that patient" then I say to you – "you can’t afford to be impatient."
Keep your commodity investments close. Keep your stock stop losses tight. Be patient.