Comments on: Investing

Question: Investing

specialk420 — Mon, 05 Jan 2004 20:00:39 -0800

with the freefall of the dollar - should one find themselves fortunate enough to have a few in the bank, what do the nice folks here recommend to hedge ones position?

By: mr_crash_davis

mr_crash_davis — Mon, 05 Jan 2004 20:09:00 -0800

I don't know about anyone else, but I spend them as fast as I get them in order to get the most value out of them.

By: specialk420

specialk420 — Mon, 05 Jan 2004 20:31:28 -0800

i'm sure amazon.com appreciates your approach :) . next!?

By: amberglow

amberglow — Mon, 05 Jan 2004 20:41:26 -0800

gold's doing well, and euros, and pounds (even canadian dollars) Maybe a euro fund? You're safe with euros going up until the election.

By: bshort

bshort — Mon, 05 Jan 2004 21:21:30 -0800

You should buy low and sell high in almost all of your financial endeavors. This means if you're getting paid in dollars right now you should probably hold onto them. No financial trend lasts forever, and if the dollar is really low now, there's a good chance it'll turn around at some point and the cycle will go the other way.

Buying euros when euros are expensive is a good way to go broke, unless you have reason to believe that the dollar is going to drop a lot more.

By: troutfishing

troutfishing — Mon, 05 Jan 2004 22:26:49 -0800

bshort - but that might just be a reasonable expectation, given the current borrowing habits of Americans and their government.

Gold. Euros. Whatever - It's all a gamble, of course.

By: troutfishing

troutfishing — Mon, 05 Jan 2004 22:27:53 -0800

I'd bet on the US dollar dropping at least for another year.

By: specialk420

specialk420 — Mon, 05 Jan 2004 22:40:20 -0800

i'm with you trout. thus the question.

By: stbalbach

stbalbach — Mon, 05 Jan 2004 22:41:14 -0800

The falling dollar will mean increased US exports (our stuff is cheaper now) which will boost the economy, which is good. The problem will arise if foreign investors decide to stop buying into the US then we have a problem. But that won't happen without a lot of other things happening first to be worried about.

If you want to research how to make money due to the falling dollar (currency investing) I asked the same question on answers.google.com and got a pretty good answer.

By: BlueTrain

BlueTrain — Mon, 05 Jan 2004 22:41:50 -0800

If you're looking to keep the value of your money fairly consistent (not up or down by too much), I would suggest buying bars of gold and having the spread over a few banks, if you have THAT much money. Families have kept wealth within their families for generations based on precious metals and stones. If you're looking to earn money, start spending some time researching consistent companies or mutual funds that are worth a large investment. In my opinion, investing in stocks and bonds requires months of analysis and constant attention, but the rewards can be great. But don't invest for a year. Invest for 10.

By: specialk420

specialk420 — Mon, 05 Jan 2004 23:12:31 -0800

thanks for the tip stbalbach - starting to head in the direction i was looking for - how to best manage shortterm/emergency/liquid funds - when the dollar in a freefall ... bluetrain. thanks as well. im covered on the longer term front.

By: skylar

skylar — Tue, 06 Jan 2004 04:39:23 -0800

Turning the question around - as a European, what's the best way to make money out of the dollar situation? Is it simply to go to the USA and buy some cheap goods?

By: adrianhon

adrianhon — Tue, 06 Jan 2004 06:55:54 -0800

skylar: That's one good way; I'm intending to take advantage of the weak dollar and buy a new digital camera for a fair bit less than I could have done a few months ago. Might also be worth considering going on holiday to the US, since your Euros or £s will be worth much more now.

By: stbalbach

stbalbach — Tue, 06 Jan 2004 08:26:47 -0800

how to best manage shortterm/emergency/liquid funds

liquid = cash = money market or checking account
short-term = money market, cd's, bonds
emergency = safe deposit box

I know one guy who has put $60,000 in cash in a safe deposit box as an emergency portfolio. You can't get that much cash from any bank anytime so he had to withdraw it in < $10,000 incriments (to stay under the IRS and who knows who else radar) over time and build it up.

By: five fresh fish

five fresh fish — Tue, 06 Jan 2004 09:47:16 -0800

Might also be worth considering going on holiday to the US

I very much doubt that's worth considering, given the kind of hell that the US is putting visitors through.

If you're really worried about the future, paying down your mortgage may be the best investment: that way even if the economy goes tits-up, you've at least got a place to live.

By: adrianhon

adrianhon — Tue, 06 Jan 2004 10:14:07 -0800

fff: Ah, but apparently Europeans are exempt from all the fingerprinting and suchlike that have just been introduced :) But your point is taken.

By: Big Fat Tycoon

Big Fat Tycoon — Tue, 06 Jan 2004 15:07:11 -0800

My strategy is to buy MORE US dollars now, or maybe in a few months, with my Canadian dollars. Eventually, when the pendulum swings back (barring a US dollar crisis or something seemingly impossible but hey, who the hell knows?), those US dollars regain strength.

By: monju_bosatsu

monju_bosatsu — Tue, 06 Jan 2004 15:56:52 -0800

Just wait until oil gets repriced in euros. Then you'll really see a falling dollar.

By: trharlan

trharlan — Wed, 07 Jan 2004 07:04:42 -0800

From most volatile to least volatile:

Gold and silver mining stocks
Gold and silver
Foreign stocks
Foreign bonds
Broad-based natural resources fund (timber, oil, metals)
US Exporter funds (Like Fidelity Export and Multinational)
Treasury Inflation Protected Securities/ I-bonds