Tuesday, January 12, 2010

Why this Portfolio investment?

Kia Ora,

Of course I have said before my investments are at present mainly in gold & silver.

Why? Because after my mistakes of getting upset with the banks & continual knock backs based on what I now earn I had to look to something that would bring in an extraordinary return on investment (ROI ). Note I often add these words because you need to change your vocabulary to that of the rich &  learn to understand them.

Suddenly there are these video snippets on the internet that take my eye. Chrismartenson.com crash course is one that is a set of 22 video presentations that explain how things are manipulated & how they affect the real world finance. Then there was the use of a video by mysilvercoins.com of Robert Kiyosaki & one of his advisors saying the same thing but in much more layman terms with a prediction for 2008.

So using that knowledge & the knowledge of history my plan is to use the capital gains to purchase cash flow producing investments. This time in history is probably the one time considering how the system works that having little debt maybe an advantage. Usually the way to get ahead is by being in good debt.

If I still had my good debt I would still have some gold as a hedge (note the use of the word hedge as opposed to the poor person calling it a speculation) against inflation. 

So people say the economy is recovering. Is it? Most of the good news actually comes from the stimulus packages, which has required more money to be printed. It is also coming from China spending up large.

There is a difference between what China is doing though & what  the rest of the world is doing. Where as the US & Britain in particular have being printing (Quantitive easing) money to keep the economy afloat, China has being running around with all its US bonds trying to get rid of them whilst they are still worth something & using them to buy assets such as gold mines or gold mining companies, resources & anything that will produce a good cash flow no matter what the economy does.

China's main worry is keeping its people in jobs, not what the US is doing as its biggest threat hsitory shows is from its own people.

There are worries that this is not sustainable & it is starting to cause inflation. The US on the other hand is printing money getting more in debt to stimulate the economy, but talking to pull back which is likely to crash the economy, then there will be more printing of currency which will end with most likely hyperinflation.

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