Quote:
Originally Posted by manaboutown
Believe it or not I am asking for a rather wealthy friend who happens to have $1M cash lying around earning him next to nothing and has no ideas on how to invest it. He and I have known each other since junior high and we brainstorm on various matters from time to time. I told him I had no idea and was sitting on a lot of cash myself (not anything like $1M).
Anyway I thought it might generate some creative thinking as I am out of ideas. Stocks and real estate seem at present extremely overvalued to me. Anybody have any possibilities they would care to share?
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The following is my opinion and not to be considered financial advise.
Given the current volatility in the markets due to current world-wide conditions, it makes the most sense right now to be in cash or cash equivalents. I do expect a 40 to 65% drop very soon in the equity and real estate markets, as well as a total bloodbath in the debt markets. By being in cash, you will be able to take advantage of the coming deflation and buy income producing assets at bargain basement prices. If your money is tied up in distressed investments you will miss out on the opportunity. If deflation is not on the horizon, that means that we are currently in the "crack up boom", and it really does not matter what you do if you do not have gold or silver.