8Mon·

What if Stagflation becomes real and we repeat the 70s? What if we get 5-10 years of economic trouble?

Sure it is only a scenario, and sure, we can again see the money printers turned on and delaying the problem once again, but the probability of seeing some harsh times is increasing.

In such scenario we are probably better of with some diversification and not heavy on any specific item except some real $GOLD (physical or digital backed like $PAXG (+0.6%) or $GZUR or other) to hedge for eventual loss of value of money (and some $BTC (-0%) for those more willing to believe in it - on a side note, I am, but not financial advice).

Besides gold, a well rounded diversification with a mix of countries and more protective sectors and solid companies who do not require heavy end user consumer for survival might not be a bad idea. Also diversify in currencies, using not just USD but also EUR and CHF and whatelse fancys your likes, might offer some extra protection.

For diversification on the traditional sector:

ETFs with world allocation and good diversified allocations, an higher allocation on the portfolio then the other items below - maybe $VWCE (+0.31%) or $ACWI , in addition to add more diversification one can also use $V3AA (+0.51%)
ETFs with diversified allocation on energy - $WEEG (-1.67%) or other
A small ammount of diversification also in emerging markets and other markets in complement to the above products, like for example $EIMI (+0.23%) and $WTIF
Stocks for solid companies, not heavy consumer dependant and also sectors like health, public services and energy - for example $MSFT (+3.69%) or $WM (-0.59%) (but avoid others consumer dependant like the plague - example $META)
Commodities and rare matterials like $COPPER, $OIL and $GAS if things do start to get bad will also probably be a good choice further down the road

Real estate direct investment will also have very good opportunities, the payback does take a long time though.

And you, what is your intake? Are we at risk of stagflation or do you believe things will just get better? What is or would be your strategy?

#stagflation
#gold
#economy

11 Comments

CD@Carpe-Diem

8Mon

Agree, but avoid ETFs. Better to invest in stocks of solid companies and residential property.

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KingC@RaphGM

8Mon

@Carpe-Diem What is the problem with ETFs according to you?

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ElShib@ElShib

8Mon

@RaphGM probably the question is that you don't control the ammount of bad apples on the basket, even though the diversification tends to reduce the risk

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KingC@RaphGM

8Mon

@ElShib Easy to say but very difficult to do in practice.
The vast majority of investors including professional one don't beat the market.
Sometimes they do over the course of a couple of years but that's it.
And the one who can do it repeatedly over the long-term (>15 years) could be counted on the fingers of one hand eventually.
If you want performance over the long run, then the best and safest option is to simply own the market.

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CD@Carpe-Diem

8Mon

@RaphGM try to follow, and you will get the full picture(information is public, but no one reads): Ca. 90% of ETFs sold in 2023 are from BlackRock & Vanguard. Those two own each other. BLK is related to US treasury and was born after the Hypothek crisis to manage the bad debt. Bad debts were given under management of BLK. ETFs consist only from 10 to 30% of AAA shares, the rest are unknown garbage and don't generate income. BLK has solid rights to change the composition of the ETF, lend the shares etc.
As ETFs are products of Hedge funds (crooks who committed several crises), so investing in crooks seems irrational to me.

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KingC@RaphGM

8Mon

@Carpe-Diem well, a quick search on public information (Internet) shows that your first sentence about Backrock and Vanguard is false.
- Blackrock n°1 indeed represents about 7.2% in terms of AuM globally.
- Vanguard n°2 represents about 5.9% AuM globally.

We are far away from the 90% that you are claiming...

As for the rest, I am not into conspiracy theories sorry.

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CD@Carpe-Diem

8Mon

@RaphGM fixed: ca. 90% of sold ETFs in 2023. are Hypothek and dot-com crises a conspiracy theory?

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KingC@RaphGM

8Mon

@Carpe-Diem no, but the story around it that you depict is.

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Malte@Malte123

8Mon

Also agree, sometimes things turn out different than we expect, one example would be the 6 expected rate cuts for this year.

Our system needs a reset, a crisis, the question is just when this will happen.
Next month, in 5 years, who knows.
Investing into more conservative stocks is a good thing in my opinion and so do I.

I think it can be good to have some loan as well if we really get more inflation, as it devalues the debt. Of course a loan should only be made for assets, not liabilities like vacation, car etc.

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Finbarr B.@dividend_master_487

8Mon

Can I chat with someone please

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Finbarr B.@dividend_master_487

8Mon

@dividend_master_487 can I have a conversation with someone please

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