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The action on my personal blog is heating up — to say the very least!
All this week, we’re getting our readers’ ideas on how to best structure the optimum growth portfolio for 2010. On Monday, most of our bloggers told us they’re bearish on U.S. stocks. So yesterday, we asked …
How would you rate FOREIGN stocks in the current environment?
Which countries do you feel will provide the greatest profit potential with the lowest risk in the first half of 2010?
Once again the wide variety of opinion and the depth of knowledge of our readers was impressive:
William W. is skeptical: “Nearly every investment pundit on the planet is touting the advantages of emerging market investments,” he writes. “That makes me nervous.”
Warren W., who says he is invested in Indonesia and China, is cautious: “Their fundamentals are better and the companies operate in markets with more potential for growth than the U.S. However, until foreign markets truly uncouple from U.S. markets, you’re stuck with ownership of good companies that cannot escape the gravitational orbit of the U.S. markets.”
Barry B. is cautiously optimistic as well: “I think foreign stock vitality depends upon where you are talking about. My overall view is that most of the emerging Asian nations will do best because:
1) They are not saddled with huge debt, either personally or nationally …
2) They are hard working with minimal expectations of what they are “entitled” to and …
3) They have a desire to become “middle class” as we once knew it, which equates to sacrifice and being long-term investment minded.”
Charles M. agrees, and points to the profits he’s making as proof: “I believe that China and India are the two best areas to be invested in right now. China is wide open and I have been following suggestions by Tony Sagami and doing quite well. In India, I invested in Tata Motors in March 2009 and have a 400 percent increase.”
Stephen A. expands on Charles’ theme: “The only place to be invested is where people have money to spend. That is no longer the United States. Demographically China and India have the largest growing middle class. Asia also has the largest manufacturing base. The best gains will be in those companies that produce products and materials for these growing giants.”
Don is solidly in the foreign stock camp and has obviously done his research: “Brazil, China and India are the best areas for growth … as well as resource stocks, oil, gas, minerals [Canada and Australia] and water resources. Also the demand for food will grow, so add fertilizers.”
Bill M. offers an intriguing possibility that few investors consider — PERU: According to Bill, “Peru is one of the strongest of the South American economies and is frequently overlooked as most focus on Brazil and Argentina. Peru has massive natural resources — lots of gold, silver, oil and natural gas.”
Overall, I’d have to say that the majority of our readers are bullish on foreign stocks — so on a scale of one to ten (with ten being most bullish), I’d say that …
The consensus seems to be that
foreign stocks rate about an EIGHT
as growth investments in 2010.
In other words, our readers are saying that they would likely prefer a portfolio that contained substantially more foreign stocks than U.S. stocks in this environment.
Now, on to my NEXT big question: What do you do for income?
More specifically, which fixed-income investments do you prefer?
Sure — the safest ones are paying bupkis right now. But for many — especially retired investors and those approaching retirement, the return OF their money can often be more important than the return ON their money.
So do fixed-income investments have a place in your portfolio? For income, safety or a proxy for cash?
And if so, what kinds do you own? U.S. Treasuries? Corporate bonds? Municipals? Short-, medium- or long-term maturities?
What other kinds of income investments do you like?
Your answers will go a long way towards helping me help YOU build a more profitable portfolio for 2010.
Just click this link and leave a comment to share your thoughts. Early tomorrow, I’ll add my own thoughts.
Best wishes,
Larry
Related Posts
- Time to load up on gold and silver? (01/29/10)
- The optimum growth portfolio for 2010 (02/03/10)
- Commodity windfalls ahead … or not? (02/02/10)
- Foreign stock bonanza ahead … or not? (01/27/10)
- How would YOU build the optimal portfolio? (01/12/10)
{ 96 comments… read them below or add one }
I’m retired. I run my rentals and just started rehabing a ranch/orchard in the high lands of New Mexico. I would like to go into growth stocks, preferably in India. I don’t need my 401K and IRAs till I’m forced to take money out at 701/2.
adakar Reply:
January 29th, 2010 at 1:30 pm
Hello Chuck,
Based on your comments you have handled your personal finances extremely well, which is great to see! We here at Uncommon Wisdom Daily.com wish you continued enjoyment in your retirement; and best of wishes with your ranch/orchard renovations in picturesque New Mexico, the Land of Enchantment.
Best,
Amber
I’m 51 and probably at least 10 years from retirement. Since I’m still drawing a paycheck, my philosophy of income generation is simply to spend way less than what I make. That might not sound like income generation in the classic investment sense, but I figure if I can save $25-30K a year of my salary, that’s equivalent to making 5-6% a year on a $500,000 CD, which you can’t even find these days. It’s no risk, I don’t have to worry about anything…..I just put it into direct deposit or 401k and never even see it. To me, the bottom line is how much cash you generate, regardless of how you do it. Of course retirement will require I find another way of generating income, but for now, saving like a bandit and living well below my means is the best formula I know of. It’s allowed me to build a cash portfolio of $1.1M, and I don’t make a huge salary and I’m a lousy investor, but I’ve been doing this since the day I left college, I’m debt free and my house is paid for, so it’s obviously been a winning formula over the last 30 years.
Larry Edelson Reply:
February 1st, 2010 at 11:50 am
A big kudos to you Steve! As you put it “saving like a bandit and living well below my means is the best formula I know of.” I couldn’t agree more. — Larry
Income options for 2010 carry lots of risk. Capital Gains , except for 2-3 week cycles, do not exist.
Bonds , stocks (US and Foreign) are likely to see major downside so high risk.
Metals and all commodities may well see downside correction in-line with the stocks (past charts).
That leaves only low interest CD’s for safety. Not much upside there.
I cannot find a safe place to park money and make a good return for 2010..until the market corrections take place. The risk of 30 plus % loses are too geat. Corrections will occur before mid year.
By year end the China , India , Brazil plays look good. Plus Gold will run again. Debt will not go away.
What am I missing ???
Larry Edelson Reply:
February 1st, 2010 at 11:50 am
Dear Lee – I think you’re right on! Perhaps though some positions in foreign bonds or foreign currency CDs with a high yield, like the New Zealand Dollar, might be worth looking into, if the dollar stages an intermediate-term rally. — Larry
I am still employed full time as is my husband and have the same philosophy as Mr. Beckel, but my circumstances starting out were much different. (I started out at $1.10 an hour minimum wage). We’re late starters for retirement savings (40’s). I have a small VA disability and he has military retirement that we have bought the SGLI annuity for me if he passes away before I do. We both have 401K’s in place and those are well diversified. I assume higher risk and have put ~1/3 of my plan into separate overseas funds - which have done exceedingly well this past year. I only have about 1/8 of my fund in fixed income. I’m also 51 and max out my pre-tax contributions and go for the catch up. I have company matching as well so I have ~ $23K going in each year. My Husband is under 50 but he also is at the max pre-tax contribution. He also has company shares in his retirement that he can keep.
I have a few penny stocks I bought that have come up into the $5-6 range. I want to buy metals stock but not sure of how much to invest.
We also have a savings account of 3 months salary each as an emergency fund. We have no debt except the house, rv (interest is tax deductible) and one car payment. We have a credit card but keep it payed off. Poor man’s thrift - rich man’s rewards.
Larry Edelson Reply:
February 1st, 2010 at 11:51 am
Dear Linda – you and your husband have obviously thought out your portfolios and your futures and have taken some very good steps, saving, diversifying, watching your spending, debts and more. That’s wonderful! Kudos to the both of you! – Best, Larry
How is my money invested, you ask? Well, it certainly isn’t in anything dollar denominated which is no-brainer considering the wholesale rape of our currency by all the myopic imbeciles in DC. Insanity and ruination of the American economy, in addition to what has been given away since the Open China/NAFTA experiments started, is inevitably on the horizon. I’m invested primarily in the Pacific rim, less Japan along with well chosen, high dividend European/Canadian stocks. All these stocks are purchased and sold in local currency. Yes, US taxes must be paid, but proceeds can be taken in whatever currency/commodity I choose and that does not lock me into US dollars. Until the US returns to fiscal sanity (which may not be in this generation’s lifetime), I will so continue.
Larry Edelson Reply:
February 1st, 2010 at 11:51 am
Dear Ed – I can’t agree more, in steering clear of the dollar. However, we must all keep some money in the dollar, even it it’s thre months of emergency spending, How are you keeping that money working for you (and safe)? — Larry
My income is from O/G Royalties and rentals income of approximately 75K annually. I am semiretired and do some independent contractor work as a seismic permit agent. That income varies lows of 30K to 125K annually. I have one indexed annuity that pays appx 300/month that is put into a natural resources IRA fund and I am required to take out of that since I am 70 1/2+ and I will also put that into natural resource funds, and also a non IRA fund of the same kind. Balance of 50K. I am trading currencies through a defined service similar to your option service, in which I have lost just over 200.00 to date, but I never go above 5% risk in a Micro account, and am using your option service. That’s it. I am willing to go asian in stock purchases as funds allow.
Larry Edelson Reply:
February 1st, 2010 at 11:52 am
Dear George – I like your approach to tangible assets, natural resources, and also oil and gold royalty companies. Well done. However, please make sure in your forex or options trading that you’re not putting much money there. Those markets are strictly speculative! — Larry
Well, I prefer lower priced, under $10 bucks, individual issue stocks. I really don’t know about how to research foreign stocks and how to purchase them…….but I am willing to learn and not apathetic.
For fixed income I search local communities for real estate develpment companies with tremendous track records. Liquidity can sometimes be an issue, but I recently found one that had an 11-month note @ 9.5% payable monthly with solid secondary guarantees and three months later found a 24 month note @ 9.0% with the same monthly interest check feature and equally solid guarantees…..I’ve be scouring higher paying dividend yielding stocks as well to test out the HYD(high yielding dow theory).
Thanks for your work!
Larry Edelson Reply:
February 1st, 2010 at 11:52 am
Dear Gus – interesting approach! However, local real estate deals are a bit too risky even for my – somewhat more aggressive approach – to investing. What if the real estate market takes another dive? What if the banks freeze up again and the developer loses access to credit? Lots of risks there. – Best, Larry
I am 75 and have a military retirement. My wife and I live comfortably on our retirements and SS.
I hold gold bullion coins and gold stocks. Your videos and comments are very helpful to me. I doubled my money in 2009 and plan to do the same in 2010.
Am I mistaken or do you live in Thailand? Always wanted to invest in the Thai Stock market. Any brokerage recommendations?
Larry Edelson Reply:
February 1st, 2010 at 11:52 am
Hi Stephen. Kudos to you! Yes, I live mostly in Thailand now, as it’s very convenient to Hong Kong, Singapore, Kuala Lumpur – and more, all within two to three hours of me. As for the Thai stock market, yes – there are some great opportunities there. However, I would wait until the country’s political scene clears up. The government is highly unstable, and likely to undergo a major change again this year. — Larry
I think selectively you can find some high yielding corporate bonds for companies that have good safety prospects and are likely to either be stable should we go another leg down or have price improvement should the economy grow. However, there are some stocks that are paying high yield dividends that are my preference as I believe fixed income yields (in general) are too low to lock up capital at this point due to likelihood of inflation. Food costs and prices at the pump are increasing. The decline in oil per bbl has not been reflected at the pump. Inflation has already started. My preference therefore is high dividend paying stocks and MLP’s. You can find strong MLP’s right now provide the benefit of 7-12% yield. Plus you get the MLP tax benefits. I have also liked the Canadien Royalty Trusts (CanRoys) but with the law changing I am cautious to buy more. I prefer the pipelines and storage units which let you clip coupons with very little variable cost. If economy improves, bump in oil and gas consumption leads to higher prices and more volume and a pop in the price of the stock. Although now there is too much attention focusing in this area so one does need to do there homework.
Some stocks with strong dividends are PDLI (biotech licensing), Philip Morris, Reynolds, PSEC (basically a public small PE firm benefitting from all companies needing cash right now) and many others scattered among sm/mid/lg cap.
Larry Edelson Reply:
February 1st, 2010 at 11:53 am
Yes indeed. I too am hot on the resource royalty opportunities. They give the best of many worlds, in my opinion – high yields, claims on tangible assets, opportunity for capital gains, and more! – Best, Larry
Could you confirm that we’ve stopped out in the UDN Realwealth portfolio position with the ETF trading rigth now at 27,28 $ ?
What do you think about this strong dollar movement, it’s a fake or not?
Thank you
Carlo
I’m 66 and working part time with $100,000 in a CD maturing in 2013 and necessarily living off the interest each month that it generates at 4.3%. Thankfully my place is paid for and have managed to stay debt free. I am worried about what “value” will be left in 2013 (who isn’t!!) and indeed what path to venture down then once I need to make an intelligent money-making decision. Since I will need to recover the interest each month to live on and since this is such a meager amount with which to invest, what should I be considering at this point in order to make an intelligent money move in 2013?
I’m retired, I need good dividends and good companies.
you had stated in an earlier post that many “mature” economies in europe were investingoff (i take it their home) shores and had been for some time. is it correct to assume that money non american investors used to invest in american companies is now headed to non us companies? which country is the main benificiary of that trend?
Dear Larry: I ENJOY YOUR E MAILS VERY MUCH! I AGREE WITH YOUR ANALYSIS ON PRECIOUS METALS. ON THE ROBBING US BY THE PHONEY, FEDERAL RESERVE! I HAVE GOT SOME GOLD STOCKS, EGO, AUY, AND SLW! FOR INCOME I HAVE STOCKS IN OTTER TAIL POWER CO. PLUS FPL GROUP. I SOLD MY REITS AS I AM VERY NERVOUS ABOUT ANY RECOVERY. I DO NOT, DO NOT TRUST ANY INVESTMENTS IN CHINA. THEY ARE A EVIL. LYING, DICTORSHIP! LATER HOMER
Larry,
Have a portfolio of 12 single family rental houses that I am selling off. It is my nest egg. I am in the process of selling them off one at a time and would like the most income without to much risk. Do not need the $1m equity but want about 8% return with inflation hedge if possible.
Any ideas?
Hey Larry,
I only trade qqqq long and short, therefore to me your updates on the nasdaq and ndx would be helpfull. I took a small position in my longterm portfolio yesterday at the close only 25k uspix which is short ndx x 2. Wicked mkt try to take only what it gives but in this mkt you need to be on board prior to the move and as you know that is not possible to do with any consistency.
I will trade qid on a decent pullback intraday in my trading account.
Have a Great Day!
Randy
Have a Great Day!
Randy
What do I do for income? I trade things for money. As far as fixed-income investments, I have none. Perhaps I should learn more about these investment opportunities.
I am semi retired and receive monies from SS and what little finance,(mortgage,commercial), loans that I close. The finance busines produces on average around $2000 a month now, when times were better I usually make around 5000 a month. I think now is one of the best times to get into the stock market as I see it is at the bottom and the only way is up.
Has been many years since I was in the stock market, but currently am vesting in financial stocks,(FNMA, AIG, etc), thru a close relative that was a stock broker.
A group invests in apartments in Oklahoma. Income has been steady and improved over time. It is sheltered by depreciation. Values increase with NOI and loans get paid off with inflated dollars. This is not my sole investment but is one you should consider.
I am a retired civil engineer with income limited to social security. My investments include 15K in domestic stocks, 19K in growth and groth/income mutual funds, 10K in a municipal bond, and 15K in a CD.
I prefer natural gas pipeline limited partnerships. As long as one is familiar with the tax consequences they have the best safe returns in the market. I am currently invested in KMP, and WMZ. They have both appreciated well and that is a bonus.
We also own DPL, AEE, CPK, SE. This portion of our investment portfolio has increased in value to a tune of about 40% in the last year and support reasonable dividends. I do not plan on further value appreciation of that magnitude in the near future.
I feel these are good income investments and a defense against further decrease in the yield in treasuries.
I`m probable more cautious then most because i am retired,but i due have stock in China,India ans S. America.I prefer ETF stock outside of this country.
I am new to the market and still feeling my way.
I have one provincial bond in my portfolio. It represents less than 1% of my investments.
Canadian Trusts for income and US pipelines. Pick the strong ones and your income will keep coming.Canada is dependable, currency will appreciate vs US, as Banking is conservative not the the crazy loans made in the US. One stock I have owned for 15 years ( Enbridge Energy was Lakehead Pipe when I bought it) pays 8% per year and it is not the best of the group. Yes it doubled in value over the years and still pays 8%.(On the basis of original cost now pays 16%) It dropped back 50% in the recent downturn but came all the way back in 2009. My only regret is that I didn’t double up when it retreated in the 2008.downturn.
I have purchased 2 year CD’s. Income is almost 0. Help!
Insured cd’s, with no penalty for early withdrawl. Earning 2% in diamond account.
Larry,
You asked what do I do for income? I am 72 next Tuesday. I own two companies and take income from them. I have no investments in Treasuries or other income investments. I am invested in emerging market mutual funds , ETF’s on commodities, and stocks in China. Most of my USA mutual funds and stocks have been sold. Right now I am buying your recommendations and praying that they produce for me.
Victor
I am in 25% tax bracket so I am buying high yield municipal bonds. I am getting 7.4% tax free which in my bracket equals 9.86% on a taxable bond. After doing some research, I found out that the historical default rate on BB rated municipals is 1.75%. This is about the same as AA rated corporate bonds. In addition, the average price of the bonds in the high yield muni fund I purchased is 79. If I can get this kind of yield and the potential for another 21% appreciation, I can handle 3 - 4 times the average default rate.
I’m currently parked in 35% cash, 30% mutual fund, and 35% in nat. resources, awaiting a correction. I need some advice on my current M/F holding-TPINX. Is it a safe bet for the future or is there a better fund with Templeton Bond A. I like the future of Mongolia and will buy after a correction.
Larry, I’m 76 and have been retired for 11 years. My fixed income stems from a defined benefit pension plan, as well as social security. I consider these to be my “bond” funds. For stocks, I prefer Canadian royalty trusts (ERF & PWE), a dividend-paying precious metals and commodities options fund (GGN), and an asia-pacific (excl. Japan) fund (APB). So far, these have served my needs very well. Thanks for years of good advice.
I have been hiding in CD’s the last couple of years but am losing money with the lousy rates. I can’t live on a 1% return on my retirement money. A couple weeks ago my Broker set up a variable annuity that guarantees a 5% minimum return per year. More if the market does good. However, I can still loose money and I can’t afford to do that. Therefore, I have not funded the annuity yet and may not. I still prefer stocks and ETF’s rather than mutual funds and I don’t want my money someplace where I can’t get it without penalty. Solution? A lot of cash in savings waiting for a good investment.
Generally, I am not into fixed income per se. I use treasury and bond funds as holding patterns. Like good dividend stocks and international bond mutual funds. Also, hi yield limited partnerships.
Canadian income trusts, monthly distributions, 6 to 12% return on same and in some cases capital appreciation as well
For fixed income my laddered CDs are currently yielding and average of 4.73%. Dividend income is mostly from oil and utility company stock. To boost future income, my inflation adjusted I-Bonds are tax deferred and exempt from state income tax. To further boost future income, I am waiting until age 65 to begin taking Social Security. Growing up, my father would not share any financial information with me. His only advice was, ” Don’t invest any money in the stock market that you can’t afford to lose”. That advice served me well in the past two years. With no earned income, losses are especially painful.
I am currently unemployed. Conservation of capital is important to me very suddenly. I am now in cash with only Gold and TBT. The markets are being whipped in my case, and this is a serious problem now, whereas a few weeks/months ago it would not have been so serious. Having lost in the recent downturn, I am unsure which way to turn.
I own no other investments, largely due to incredible uncertainty.
The previous investments in short term mortgage financing are down to about half (due to defaults), in spite of amounts loaned being only 50% of valuations at the time. I am now part owner of the properties.
I have about 20% in Emerging Mkt ETFs, but I am getting a bit suspicious of the consensus view that there is nothing but blue skies for this sector. Maybe longer-longer term this will bear out, but for 2010, I am more inclined to load up on domestic high-dividend stocks. I am keeping 25% in the gold play as protection against dollar debasement (not necessarily occurring as domestic inflation).
It is possible for the dollar to be slowly destroyed even without domestic inflation, since the job market is so weak. Meanwhile, the corporations have adapted, and will either pay higher dividends or do M&A. So, the 3% or higher payout from stable corporations is looking pretty good short term. If hyperinflation does kick in, it will not be good for equities, but it will be far worse on bonds
Russia, Singapure, Brazil, Argentina.
China, Indonesia and India will fell under pressure later this year, for several obvious reasons.
The four will out perform simply because they can provide the required supply ( only they can out perform the demand if the wish to do it)
The rest as food is simple speculation by GS, JPM and the rest of the gangs - shortage of food did not exist at any historical time.
Housing is still overvalued and untill the banks start to value them, nothing will happen.
Currency will be the most vulnerable invetsment - a lot will be sucked up
You have to have a foreign segment in your portfolio. Where, is debateable but the soundest
countries financially makes sense. Chose a fund available in US with very experienced managers.
I am presently heavy to gold and also mining stocks here in the US. But do invest in agriculture in the Phillippines, they are exporting rice and seafoods around the world, I am also looking at steel stocks in china, they seem to be looking good for the coming year.
My income is from annuities (I pull nothing from these), retirement funds, social security, cash build-up and CD’s.
within my very limited knowledge: all equities-domestic & foreign-look bad now. gld &slv don’t look good either but i’ll continue to hold on to them. cash- what to do with it just now? i guess, just wait for something to look good. japan looks to be headed into the abyss - much pain to come for many poor souls - &much $ to be made for those who know how. what about put-options on 20-yr jgb’s ala mr. kyle bass?
I currently go to the local dump and search for scrap metal and aluminum cans which I take to the junk dealers. Not a whole lot of money but it keeps me off welfare. Good luck with your program.
Haved moved out of US stocks. Now almost totally into Australian resource stocks. (Small Cap) My anchor income is from rental property. Seems to work pretty good
Hi Larry: Regarding your question about the source of my income, I get good ole Social Security Retirement, $957.00, a month and right now I’m in a very heated dispute with Chase Home Finance, because they opened an escrow account without my knowledge and want me to increase my monthly
payment from $543.80, to $909.16. As for current investment, I have none but I testing a device that I conceived of back in 2004. If it functions as I think
it will, I will give a written guarantee to everyone that has a gasoline engine, that gets one of my devices, that as long as the condition does not worsen
their fuel mileage will at least double and most likely will triple and it will decrease exhaust emissions. I have an old 1991 Geo Metro that I didn’t add any
parts to, that gets 60 MPG on the freeway, and depending on the weather gets between 37 & 43, MPG in town. But because of other things that I have
given a higher priority, I expect that it will be about one more year before I start selling my devices to the public. Anyway, as far as where to put your money so it will be a safe investment, people will always need food, water, and some form of energy. I did make some pretty good money in diamonds.
TRADITIONALLY, ANY INFLATION HAS CAUSED REAL ESTATE TO RISE SUBSTANTIALLY.
yOU MENTIONED IT IS ALREADY HERE AND MANY ITEMS ARE ESCALLATING IN PRICE.
IN SOCAL REAL ESTATE PRICES ARE QUITE FLAT WITH STILL MANY DISTRESSED PROPERTIES AND LOW VOLUME OF SALES. PERSONALLY, I FORECAST EVEN MORE FORECLOSURES AND WITH HIGHER INTEREST RATES IN THE OFTING, WHERE IS THE POT OF REAL ESTATE GOLD?
ARE THERE NEW RULES IN PLAY? HAVE THE GREEDY BANKS, BY WITHHOLDING CREDIT AND STIPULATING UNREASONABLE QUALIFICATION DEMANDS QWASHED THE PROPERTY MARKET.?
PERSONALLY, I AM QUITE TIRED OF LARGE INSTITUTION MANIPULATION ESPECIALLY WHEN IT SERVES STRICTLY THE LEADERS OF THOSE INSTITUTIONS.
IS AN OUT CRY FOR THE RECONNECTION OF ACTION AND RESPONSIBILTY FORTH COMING?
I WROTE A LETTER TO WASHINGTON SUGGESTING THAT FOR EVERY EMPLOYEE EARNING $250,000/ YR OF A COMPANY BENEFITING FROM GOVERNMENT ASSISTANCE (BAILOUTS) THERE SHOULD BE A LEVY, A FINE, A TAX…SOME EFFORT TO MAKE THE DECISION MAKERS CAUSING THE DEPRESSION ACCOUNTABLE FOR THEIR ERRORS IF NOT BLATANT GREED AND IRRESPONSIBILITY.
HOW ABOUT YOU GUYS TAKING UP THE GAUNTLET ?
Currently I had to borrow against the my IRA to replace a furnance. The bank required me to lock in at 3 percent above the loan ammount. I have Munciple bonds that are not producing at a profitable rate. I took big hits from 9/11 and then the housimg bubble. I still own several properties that are still producing some income, but I still have not recovered from the hits I took. I ned to know how to invest a small ammount that will gain a larger amount and then I could pay off the loans and reinvest at a later date. Right now I am too nervous to invest in the foreign markets. I prefer to now invest in precious metals and renewable resources. Once I recover and begin to take profit I will be able to invest more. How do you do alot on very little?
Currently I had to borrow against the my IRA to replace a furnance. The bank required me to lock in at 3 percent above the loan ammount. I have Munciple bonds that are not producing at a profitable rate. I took big hits from 9/11 and then the housing bubble. I still own several properties that are still producing some income, but I still have not recovered from the hits I took. I ned to know how to invest a small ammount that will gain a larger amount and then I could pay off the loans and reinvest at a later date. Right now I am too nervous to invest in the foreign markets. I prefer to now invest in precious metals and renewable resources. Once I recover and begin to take profit I will be able to invest more. How do you do alot on very little?
banks are buying gold when the price gets way down and they have their fill gold will go crazy banks make huge money all over the world dollar will be so low we can start paying off china with little dollars world is good end of story 6200 gold problems solved
Re Yesterday’s question: maybe India. Re today’s question: I have Certified coin, USSav Bonds -30&20yr, and my 401k currently is in Stability of Principal fund. I have a portion in a CD @ credit union paying more than my 401k. I also have a separate Roth whose funds have not yet caught back up with what I put into it.
I began investing in real estate about 22 years ago. I manage my own properties and–yes–I am getting tired of it. The downside of real estate is the increasing rate of property taxes. However, I can do something to increase a property’s value rather than depending on some BoD or an anonymous team. I also invest in natural resource stocks and in gold.
Investing in Tax Lien rates high for assurance of short term income. Fixed interest rates ranging from 12 to 36% depending on the State…plus Tax Liens are guaranteed by the government. Institutional investors have dominated this market excluding private investors… 2010 is our turn.
What do I do for income? Now, that is a sad story. U.S. T’s, CD’s, deferred comp from our firm and a few other things such as rental income. So, all cash is losing value every day. Guess I will soon throw caution to the wind and invest about 1/2 of my cash IN SOMETHING–not in any communist country.
Am becoming concerned about possible government involvement in 401K’s. Surely they will leave previous 401K’s alone, but who knows.
Might just buy some more real estate. At least I can touch it!
Your ideas?
Most of my money is invested in national saving schemes of my country[Pakistan] and some of it in equity funds of a bank[Muslim commercial bank].They give an annual profit of approx.10-11%.I do not have any experience of investing in stocks and lately suffered a huge loss by investing in gold.
Your advise would be much appreciated.
Thanks.
Hello Larry,
When in cash I use a rotational mix of bond and currency ETFs from donsfunds.com. For the past few years this strategy has earned 5% to 7% which beats about any bank or money market fund and may be safer.
Steve
I have my own business, but to keep money appreciating I am invested partly in stocks in India and in sectors which are showing high growth particularly auto ancilliary stocks, sugar stocks, pharamaceuticals stocks and cigarette manufacturer stocks. Pharmaceuticals are defensive stocks, hence it is like a hedge.
Larry, I have been reading a lot of info from ETR and I have subscribed to a few programs, but I have no idea what to do. I am 59 with a full time job. I have a small amount in my 401K and a small amount in money market because I do not know how to invest in this crazy economy, I need some help!!. From what I have read, it looks like China, India, Brazil and Peru is the way to go. Also pipelines, fertilizers and energy. Gold is great, but I do not have that kind of money to invest.
Am employed hoping to retire at 66 but the state of the falling dollar is scary. Have some gold but am really unsure what else to do with my savings. Feel that changing my money into ANYTHING but dollars would be better than what I’m doing now. Am new to the investing game unfortunately. I just heard Warren Buffet changed all his dollars to Yuans (Chinese). Is this true and what are your thoughts on that?
Have most in a money market account 2%===Woohoo!!! And one small CD (no better percentage) Sad returns eh? I figure with the dollar shrinking I’m actually losing. Sad Sad.
I own Canadian income trusts.
I am retired and thus have fixed income. But how long? I hold some stocks but do not know how they will do in the future. At the moment I loose money and think that when things turn really to the downside all stocks worldwide go to zero (?). Gold and silver which I hold are money only when the nation crashes. Will she do? Uncertainty is floating around in my head and in the markets. So I would appreciate solid information how to behave. Could you evoke the lurking problem of currency devaluations/reforms and their consequences? I do not know if you are informed about the situation in the EU; sometimes I think it is worse than in the USA, even if you don’t see it. Look at Greece, Spain and the other ClubMed countries, they are all totally broke!!! Also the eastern european countries. Even Brussels mention every day the lurking problem of a currency default of the EU. Germany pays billions to these states and - no joke! - has recently bougth 12 new paper money printing machines, the biggest deal since 1920! Money gets out of the Bundesbank in lorries, no joke either! That’s the situation, somewhat crazy I think
I have corporate bonds to provide an adequate retirement. I avoid debt like the plague hence I’m not pressed for future income. I use the extra earnings aqumalated over the recent years to invest in the market.
am a contractor and farm
I am severely underweighted in Fixed Income at this moment. I own no US-based FI at all but I do have Canadian short term Bonds, Canadian Inflation protected (Real Return Bonds) and some balanced portfolio Canadian mutual funds.
I am overweighted in emerging markets, resourses and dividend stocks
I have Markwest (MWE) for income
fcj mwe are 2 of the better income stocks I own
I am currently on disability due to having 4 strokes. The first one back in ‘97 I was told that I was going to die or if I did pull through I would be a vegetable. I am glad to say both options were wrong. The work that I applied to recovering is what I am ready to put into being successful with this program.
I agree with most of the other posts that the asian countries are where it is at right now. If I could invest in a “in house state I would invest in Alaska. It is an independent state in many ways and the people are very wise, as a whole. It takes special people to live there. The state is very rich in gold, oil and will grow in many ways due to the determination of the people. I have not given up on the USA yet. Just it’s current government.
Need help on income producing investments in this current economy. Your emails are helpful and appreciated.
I have been buying preferreds for the last five years or so starting at the 6% cent level and in the last year in the 8% range or higher. The names I bought were JPMorgan, HSBC, BoA, etc. These are mostly long dated or in a few cases perpetuals. Early on I bought industrail names. I have spread out the payment dates to have income almost every month.
Master Limited Partnerships can provide stable and consistent returns on investment. Many think that natural gas is undervalued now, so MLPs within that industry could pay off nicely over the long term. I would like to hear more about “toll road” type investments in Canada, Brazil, Australia, and other countries with strong economic fundamentals. Fortunantly, I have been a subscriber to Larry’s Real Wealth for a long time and bought his recommended gold stocks and funds in the $300 to $400 range, and those investments are up quite a bit. Silver and Palladium could provide good returns longer term. Commodity food stocks have done well and could do well going forward.
Hi!
I use stocks like atlif - Atlantic Power as my checking account. They pay monthly and the div. is relatively secure. Pays me 12% (when I bought it) around 10% now. With a low cost brokerage account one can take out money once per month and make a reasonable return.
My wife and i are retired; ages 60 and 67. We depend on our financial assets for the majority or our income. We are still in the process of structuring our “income portfolio”. We are/will be using varying combinations of the following: fixed immediate annuities; primarily straight life and fifteen year options; a variable annuity with a credible guaranty of a 6% minimum annual payout of the initial deposit for either/both lives and after; some individual bonds as well as bond funds; some high yielding stocks and MLP’s; some stocks and funds for “growth/growth&income” Our favorite funds are: Hussman strategic total return and the TFS market neutral (now closed); we also like the Permanent Portfolio; MERKX; FPACX; GLD;GDX;TGLDX: etc. We are currently short the TLT. ETC; ETC. We keep roughly 9 months worth of living expenses in VERY liquid accounts & cash + 25% of said amount for unforseen expenses/emergencies. Our goal is to take an annual income of 5% from these financial assets (not including “the liquid funds”) without invading principle. We have met and talked with MANY “financial advisers” and have not yet found any of sufficient competence. We have estblished some small investments outside the USA. I would like to have at least 30% of our money sited outside the USA. I view anyone who does not see the necessity of removing a substantial % of his/her net worth from the USA as delusional at best. Cheers!
We have many of our clients in Fixed Annuities and Equity Indexed Annuities some return 3- 5% while others have a return of 7-8% guaranteed and grow tax-deferrred. The rate is determined by the length of time. Do not expect reurns of 12-20% with these products.
This is the year of the ROTH Conversion that may work well for a lot of people with money in IRA’s.
I personally own Cash Value Life Insurance and buy Silver Eagles.
Did you know that Cash Value Life Insurance can be used as a Retirement Vehicle?
As a follow up to my recent post re’ “moving some money out of the USA” — i DO NOT do this to evade/avoid US income taxation — or even to reduce taxation. We have reported our taxable income every year on our “1040″ and the neccessary Treasury form. This first became neccessary(for us) in 2005. We have never been audited or contacted, or questioned by the iRS or any other US governmental agency.
Currently with the scenario of the U.S. Government having to pay back the debt in devalued dollars, I believe that a good source of income can be real estate. I don’t like many real estate markets, but I do like health care reits, and also individual ownership in business condos. The business condos have multiple business owner tenants that have pride of ownership (unlike apartment dwellers) and the tenants expect that rents increase with inflation. Additionally, vacancies are less of a problem as most manufactures reps, insurance agents and sole practioners can afford $500-$700 a month for a nice space. I will get 9-10% ROI on these properties with no leverage.
I also like to write covered calls on gold. Then I’d buy more gold (Thanks for the commentary and charts) by writing puts to enter a position. This way, I may get the gold at a below market price.
These investments all entail risk.
What do YOU recommend for the investor that doesn’t want risk?
Annuities are the most tax inefficient vehicle out there, and if you annuitize now, I believe you are in for a rude awakening.
Remember that the Dow Jones Industrials hit 1000 for the first time in December 1972. THe prime rate then was 5.5%. If you relied on Fixed income and locked in an immediate annuity or pension, you would have been in trouble. 1973 brought the OPEC oil embargo and a big spike in oil prices. And, what was thought at the time, the beginning of the end of the US auto maker. The federal debt was huge, as we had to pay for Vietnam. Fast forward to 1980 when the inflation rate was 13.5 % that year. (According to the Bureau of Labor Statistics- many people believe that the basket of goods & services was manipulated to make the number lower thatn it really was.) And in 1981 the prime rate jumped to 21.5%. Those poor souls that had fixed income….. Alpo was the dinner of choice for some. Remember that it took 10 years December 1972 to November 1982 for the dow to permanently sustain a level over 1000 points.
Do these events seem similar to what has recently gone on in the last 10 years? Will we have another bull market like the one that started in 1982? THe debt is the reason it won’t happen.
Ask the Japanese how long their market has gone sideways. it has been 20 years.
Larry makes good sense for thoise smart enough to think outside the media hype of Buy and Hope.
I mean Buy and Hold.
Don’t be fooled that “Safety of Principal” should be the watchwords
Foreign stocks are interesting in India,Chile,Canada. Gas, oil, pipelines in u.s.
This must be an omen,just yesterday I set up plans to change my IRA to a Gold and Silver IRA.I was in a IRA Hi risk but trippled my money in three years,then when when they couldn’t figure who won the presidential election I lost 50K.Then another 10K.I went to an annuity,safe,but no growth.Then 08 lost 30K more,I figure with this joker trashing the dollar,and the rest of the America with it ,gold and silver will be the winner.
Hi Larry,
I am 50% in gold as of today with the pullback to the 1080 level and the dollar going to close to the 80 mark on the index.We may not be at the bottom but I never get the bottom or the top. I like the risk ratio at this level for gold.
Fixed income assets like treasuries and bonds are not for me. I rather own those in 2014 when interest rates are much higher and I can get a nice interest return and the chance for them to rise in value. I might consider TIPS in the future but not yet. Just telling my 2 cents worth. Nat gas is a no brainer and ther are a lot of funds that pay a nice dvd and the price of nat gas is cheap. I know there is a lot of supply but that is the best time to accumalate. I liked oil at 10 bucks and gold at sub 300 too!!!! Noone else did but when it cost more than the price it has to be a no brainer….
I like these 2 but there are tax issues some want like because its canadian so beware
PVX—–i LIKE THE MONTHLY dvd and compounding effect
PGH—Time to buy on this pullback
Canadian trusts, about half oil and gas and half business trusts. All these must convert to corporations by 2011. Those which have already converted have had a nice (20% - 30%) bump up in share price. Most others which have already announced plans to convert say they intend to hold the same levels of distributions as corporations as their current distributions.
And US master limited partnerships, especially those with midstream energy assets like pipelines and storage facilities. Just make sure the ones you pick have reasonable debt loads and good access to credit.
I don’t need my IRA to live on fortunately, so I am still looking for a good rate of appreciation. My split now is 50% equity, 45% fixed and 5% commodity. I am very interested in the hedge against falling dollar. I know you are right. However, this $ decline will probably play out gradually, so I am in for at least a decade. Even if a republican president were elected, I can’t imagine how we can climb out of $13 trillion debt without printing $. Am I missing anything? Those Americans can be pretty resourceful.
Rather than buy gold which is a passive hedge, I prefer to look for unhedged investments, bond and equity, which can actively appreciate without losing on the currency. Double profit. I know the unhedged bond funds are scarce. Are there any good equity bets? Lets go for a total of at least 70% unhedged for both strains. There may be a return to high energy prices. What do you think?
Larry……You are the coolest dude I have come across in all these newsletters I get——you talk like a technician but your still “cool”——My problem is that I have no money…and what I do have is invested in a pooled account[silver] with a company in South Carolina called Premex…of whom I have not been able to contact for about two months now………..been trying to figure out what to do next??????? I really want to get one of your currency letters and trade currencies but until I get some cash together I must watch from the sidlines………..you guys always have interesting ideas and thoughts and I always enjoy your and tony’s video’s——————later
I am 56 and was laid off from a Sr. Engineer position when Micron Technology shut down its Manufacturing Plant. I have $188k in a 401k, $85k in a traditional IRA, 15 oz of gold, $12k in US stocks and $25k in a FCU. We owe no money on our $250k home, 2007 Ford King Ranch PU or 2008 Hyundai Azera. We have zero debt but have slim ideas on how to protect or grow our savings. The three financial advisors we have talked to seem to be in-it for themselves…making no sense from my perspective. …not much market for 56 year old Sr. Engineers so I want to plan for retirement now (in safe mode). Can you offer any advice? Sincerely, gm
I have a few bonds and bond ETF bond funds. By far my best two (in order of best to 2d best) are a) a closed
end fund of municipal bonds (IQI) and TIPS. They are no-brainers as far as I’m concerned. HAH
L
We are in a deflationary environment with a false commodity boom propped up by a Chinese bubble. A bubble created by one of the last countries on the planet not in deep hoc. The big global banks only five which are American run the economic Titanic and none of these banks are giving shit to medium and smaller business which make up the bulk of jobs….global markets are set to crash again…
Have fun!
M
I consider well researched MLPs that have a history of both growth and capital gains to be excellent income investments. I have substituted these in place of bonds which I do not own.
if you like pvx and pgh, what about pwe, erf etal?
Moose is likely photoshopped. I’m unbelieving a guy that big would wander around through forest like that. His size and rack would prove most uncomfortable if not impossible for navigating brush like that. His dietary intake would be massive!
Dear Larry,
I like to concentrate (giving more weight by percentage) to investment vehicles that have not yet made their move, but have good potential. Obviously, recently precious metals made catch up moves, and overshot the price that was reasonable. Including your letters were focused on the buy side at the top. Buying it on the pull back sounds good. There are other areas of investments that now are more than likely will try to catch up. This to me is timing + research makes sense.
Investing in some exotic stuff may lead to unpleasant surprises. Crooked brokers, bankers or governments playing games. I am waiting to hear the verdict on the reliability of some of the sophisticated ETF’s. Is there sufficient funding behind these or there is an other sub-prime lurking with the crooks having moved to this new quagmire of possibilities. Something like uncovered shorts or your stocks being used by brokers as collateral etc. I am also enraged by the government forcing the low interest on cash while the cost of everything is going up. So one day when you go to the bank to pull out your money, you will find out that your life’s savings will only buy a dozen eggs. Hence diversification is a must, in case one of the parts of the whole is bankrupted by the lack of supervision of the officials.
Saving the underfunded over appraised properties is just a version of sweeping the incorrect appraisals under the carpet and promulgating the same process; that got us to the current financial crises by criminal acts. Think of the above before spreading your investment money.
I have some funds in an international fund and an emerging market fund. They have many of the oversea countries that you have been talking about lately. Will these type of funds continue to do well? Recently they have been dropping more than the gold, oil , etc.
Hi Larry,
I’m construction estimator (typical office race rat), have feeling like loosing my job any day soon.
My younger son is full-time college student yet.
I don’t have much on any of my accounts: I don’t want even mention it.
My Fidelity adviser will never make me happy, because he is not a magician, unfortunately…
I have no experience of working with stocks by myself, but thought about it a lot.
I only enjoy reading your web sites. I amazed how generous and knowledgeable all of your team members are! Many thanks all of you for sharing it with us!
I really wish I could improve my situation…
Best regards,
Several corporate bonds in portfolio have 2010 call dates. Assuming the call will be exerecised since
some are worth more than par what sould I do with this cash.? I hope to avoid investing in US Treasuries. Any suggestions? Thanks.
NLY
ERF
KMB
KMP
PSA+K
IRC
BANKS
To say I am nervous about the economy is an understatement. Right now I am with Rochdale Investment Mgmt. and I am worried that they will follow the downturn. I fully agree with your synopsis on world wide investment as opposed to U.S. If I move to managing my own account I would like to find municipal bonds paying 5% for half of it and put half of it into good foriegn investments that payt didvidends. I still like Canada Natural resources. OI need help but I need an advisor who is willing to actually reserach and perform to make money. My total portfoilio is only around 350K so I do not have room for error.
Larry,
Here’s my forecast: Obama’s faulty decision making methodology guarantees that he’ll continue to worsen every problem he touches — even by his own standard. However, the more this goes on, the sooner will come the change in the motion of the pendulum (as illustrated by the fact that a Republican now holds Kennedy’s seat). The Republicans will prevail in the Nov. 2010 elections, and bring increased gridlock which is better than having the Democrats or Republicans in control. However, both parties are controlled by powerful interests who profit from the status quo. My strategy is to surf all this.
I have a major advantage of being small — I can not affect the Market!!!
Don
Hi
I’m 38 from India. I did enter the stock market two years ago independently and I did enjoy the opportunity it offered me.
I work as a programmer and since I day trade I am seriously considering giving up my programming job for time to day trade.
I realize where real opportunities are i.e. in the stock exchange
Vivek
C.OLLECT SOCIAL SECURITY AND INTEREST FROM SAVINGS.