Investing During a Depression
At the most foundational level, there are two basic types of
economic depressions. There is a deflationary depression, like
the one that occurred in the United States during the Great
Depression of the 1930's, and there is a hyperinflationary
depression like the one that occurred in Germany during the
years of 1922 and 1923, and more recently in Zimbabwe during the
years 2000 to 2008.
Some investments, like gold, will do extremely well in
either type of depression. Gold and gold stocks did very well
during the 1930's depression in the U.S. as well as in every
hyperinflationary depression of record.
Other investments, like bonds, will do well in one type of
depression or the other, but not both. Bonds do very well
in a deflationary depression, but owning bonds in a
hyperinflationary depression can mean a near total loss of
investment.
As for stocks, some stocks will do very well in a
hyperinflationary depression, while doing poorly in a
deflationary depression. And vice versa.
Foreign exchange markets, also called foreign currency
trading and forex, can prove to be very lucrative in either type
of depression, provided correct choices and decisions are made.
However, forex can better be described as speculating and is not
for the faint of heart or for those new to the world of
investing & speculating.
About the only investment that universally does well in
either type of depression is precious metals. All other
investments will be type-specific in their performance. That is
why it is so critical to pay close attention to the nature of
the depression as it unfolds. Buying bonds in a deflationary
depression is a wise move that will yield substantial profits.
Buying bonds in a hyperinflationary depression will bring
near total losses. Likewise, investing commodities in a
hyperinflationary depression will bring solid gains, while
buying commodities in a deflationary depression will just about
guarantee significant losses.
We provide up to the minute information on the latest
economic currents flowing throughout the economy. It will be
critical to know which type of depression we head into. Your
financial prosperity, your very financial survival, will depend
on taking the appropriate defensive investment postures
according to which type of depression evolves.
Of course, we will keep you abreast of the most current
information available.
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