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If cash is King, why not (good) cash?

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  • If cash is King, why not (good) cash?

    Ok...I've been a select member for less than 24 hours, but allow me a tentative question:

    "If cash is King" in a deflationary environment such as our present impending "ka" circumstance...would not cash denominated in a quality currency be better than GOLD which may suffer deflationary commodity damage? (I know...fourth currency and all that, but it seems like gold is in a bit of a mania). How about Swiss franks or Norwegian Krone? Those that stayed out/above Wiemar madness did quite well if paid in foreign currency for instance.

    My present allocation:
    30% equities
    10% precious metal
    30% cash
    30% bonds

    Considering High-tailing it to:

    30% equities
    20% energy/industrial commodities
    10% Responsible foreign currencies
    10% Debt laden utilities
    20% GTU/SLV
    10% cash


    Thank you for your thoughts,
    T

  • #2
    Re: If cash is King, why not (good) cash?

    Originally posted by touhy
    "If cash is King" in a deflationary environment such as our present impending "ka" circumstance...would not cash denominated in a quality currency be better than GOLD
    I suspect you're optimizing which dessert to have with your fine dinner ... on the Titanic a few minutes after it hit that iceberg.

    And I'd avoid GLD/SLV ... I don't trust that they will really have the gold to deliver to my lifeboat as I float away.
    Last edited by ThePythonicCow; 08-30-10, 04:23 PM.
    Most folks are good; a few aren't.

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    • #3
      Re: If cash is King, why not (good) cash?

      Agree with TPC. Trying to fine tune an allocation strategy works only works when there is some sanity in the system (rare even in the best of times) I played that game for a while and it drove me crazy.

      I think your PM allocation is too low.

      30-50% PM, or perhaps more, works very well. As much PM in physical as you can stomach. PM's offer both peace of mind and a highly satisfactory rate of return. I know people are reluctant to do that. There is still enormous resistance to holding PM's in the mainstream investor community. Seems too barbaric, too pessimistic, too right wing extremist, too whatever. But holding PM's just works and remember the trend is your friend.

      The rest? Perhaps, just plain old cash to take advantage of trading opportunities in the equity markets and if you're really up for it, the futures markets.

      If you are looking to just park money with a long term hold in mind, then as you suggest, responsible foreign currencies and energy/commodity equities. Perhaps, very high quality, very high yielding equities of other industries.
      Greg

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      • #4
        Re: If cash is King, why not (good) cash?

        all currencies will become worthless so why have any of them in your portfolio? Best to be 100% in precious metals. I can't see a downside to them. There is so much debt and government efforts to increase and pump up more debt at all costs, that it is obvious to me that PMs are where it's at and by that I mean physical.

        Cash? Are you kidding?

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        • #5
          Re: If cash is King, why not (good) cash?

          Interesting...

          I would personally try the following:

          40 % cash deposits (but for short period of time, so that I can save them as quick as possible, before major banking crises appear)
          40 % bonds (some foreign bonds have great yields: 6-8 %)
          20 % physical PM's (70 % silver, 25 % gold, 5 % platinum)

          I guess you never know what could happen...

          But I'd honestly like to speculate with ETF's, only that I don't know much about the paper gold and silver market. If anyone can recommend me a source where I can learn about ETF investments, send me a private message, please.

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          • #6
            Re: If cash is King, why not (good) cash?

            This thread is interesting to read three years later. I was wrong.

            Touhy

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            • #7
              Re: If cash is King, why not (good) cash?

              You weren't wrong. Many ideas/opinions stand the test of time
              And 3 years is not a long time.

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