Where do we go from here?

As 2012 is set to come to an end, I am blown away by the tremendous calm in the capital markets.  Global debt levels in Europe, North and South America, the Caribbean, and parts of Asia and Africa have reached unprecedented levels.  Many countries whether officially declared or not have defaulted on their debt.   And the prospect of a solution, to our international insolvency problem, seems very unlikely.  The pundits often claim that the markets are efficient, and if this is true, then why with the preceding information readily available are the markets for the most part stable?

I would not dare speculate on why we have oranges or wind or why there is a sun.  But the markets, these are “manmade” entities and therefore I feel much more confident offering some conjecture.  The one truly consistent premise in this world is the irrationality of humanity.  Yes I said it, “people are nuts!”  And, people made the markets.  Therefore, the markets are nuts! So faced with all of this, what can an investor do to make, or at least preserve, money in 2013?

#1 Buy some gold, why because it makes no sense.  Since the beginning of time we have arbitrarily decided that gold has currency like value, and because this ore exhibits de facto defensive currency characteristics every portfolio needs some in 2013

#2 Hold some USD, despite the USD Federal Reserve doing its best to devalue the “greenback” by printing more dollars than they can afford, the world economy is so bad that the $ is the prettiest in an ugly currency contest. And, as such, if there is a flight to safety in 2013 you will be ok.

#3 Invest in Government of Norway Bonds if you can!  I’ve been there, they are a healthy people, most can defend themselves with a firearm and yet they have a very low murder rate....hmmmmm!  A country with low debt, not saddled with the problems of the Euro, a Sovereign fund for their petroleum products and a proximity to Denmark which I only mention because I love their butter cookies over the holidays.

Now that I’ve retired, I look forward to openly giving you unfettered access to my perspective on the financial markets.  I hope you enjoy.

Hold tight!! 

Disclaimer

All opinions expressed by Steven Conville on this article are solely StevenConville’s opinions and do not reflect the opinions of any other company or organization. Nothing on this article should be regarded as a recommendation to buy or sell any particular investment or follow a particular strategy.

Steven Conville believes that this information is reliable, but does not warrant its accuracy. No information provided on this article should be relied upon as such. Steven Conville does not have any obligation to update or correct any information provided on this article. All opinions of Steven Conville are subject to change without notice.

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