The Tycoon Report

How to trade in a market that zigs and zags.

Chris Rowe has hit the nail on the head. What if we have years and years of deadly whip saws? Where neither the bulls nor the bears have the upper hand. If you don't anticipate these moves you can lose time and time again and wind up worse than when you started. You have a choice, you can try to be nimble and trade these whipsaws. If you stay fully invested you will get nowhere and wind up right where you started except that inflation will have erased much of the value of your portfolio. (See Germany's hyper inflation where your cash lost value every day). Money market funds are useless now with miniscule interest rates. Better to be invested in hard assets that keep up with inflation. At least if you are invested in the stocks, the price of your groceries will keep pace with the stocks of those raw materials. Personally I don't think that deflation is in the cards. We have to inflate our way out of this mess and we must keep our nest egg where it will not be decimated by this inflation. At the moment gold is on a rampage but there will come a time when everyone that wants to own gold will have done so and where will the future buyers come from. I have just taken my worst performing gold stock and switched it into silver, those two precious metals are far apart from their historic relationship and either the one will fall or the other will rise so silver looks safer at the moment. The current climate is almost unprecedented as it is global in scope with instantaneous financial information and consequently instantaneous response. It is fascinating to watch and requires immediate reaction. You have to be quick on the draw to survive these days. It's fascinating to be able to live through what must be historic times and I hope I am able to survive to watch how it all turns out.