World Markets preparing for Euro Disaster:Investors told "Sell off and hold cash"

The crash is coming. Some analysts are predicting a drop in the markets of 25-30% and recommending investors begin to liquidate and hold on to the cash they have until the waves from the crisis pass, 6 months to a year.

This will truly be disastrous for the USA, stagnating but not recovering. If we were on a recovery track, at least we would have some room to weather the storm but we're operating right along the margins. Obama and Geithner and Bernanke should be putting thier heads together in crisis mode to find a way to shield the larger part of the US economy from this, but instead Obama is in campaign mode.

What should the US do?

 

Geez, Silicon. Thanks for the warning. The USA should print a zillion dollars and buy gold and food rations with it. lol

Seriously, I'm glad that I'm locked into a 401K that would charge me copious amounts of penalty for pulling out of the market.

You could just tell, even with the mainstream media trying to stave off this cold hard truth of disaster for their leaders, that this was not going to end well.

 

Holding cash seems pretty dangerous. Especially if there is a currency crisis.

 

Holding cash is a bad idea.

 

Over the long term, yes. But in a short term span of 6 months to a year, it doesn't seem like so bad an idea.

You could of course move it into gold or other commodities but given the huge bubbles that these commodities are facing right now that could lead to its own host of troubles.

 

You know what happened during the Great Depression.

Give me your gold.
-FDR

You know how the people made it through the Great Depression? Local communities looking out for one another, not unaccountable jerks in DC sitting on their high horse.

 

The reason it's a bad idea even in the short run is the way governments and central banks handle problems like Europe's (and America's) is to debase the currency. When stocks get hit they bounce back, but when currency is debased it never goes the other direction.

 

I have to admit that I am baffled about what is going on. Europe is in obvious crash and the US markets go up..???

It is like no one is paying attention.

 

Big dogs will pump it up and pull out right when it's going to crash. Par for course.

 

Currencies can gain value.

 

True but extremely rare.

 

Wouldn't be if it weren't for central banks, or if Lysander Spooner had got this way.

 

Absolutely. It's a tragic shame.

But I'm not sure I agree with spooners views on money and credit.

 

Speaking of which, what happened to the excellent poster with this avatar? AbsoluteVolunteerist maybe?

 

As a man that has a 401k.... you do not need to pull your money out. That would be foolish. You put your money in a money market fund. Which essentially the same as cash.... Hence... no penalty... Almost every 401k plan has such an option.... yours probably does too...

 

Thanks for the suggestion, I will look into it. My company matches my contributions up to a certain percentage, so I've basically just been contributing that much and not looking for other areas of the market to invest.

 

bailout europe using american tax dollars donated to the IMF

they will not fail because the international montary fund was created for times like these that could cause conflicts in the world when one economy exploits or hurts other economies

 

Finances are sort of a hobby of mine. I fully understand that not the govt, or anyone else is going to drop a bag of money on me when I want to retire. That means I have to do all of the saving, investing, and planning NOW... otherwise that retirement day will not happen. If you are ever interested in learning more about 401k's Roth IRAs, etc. Feel free to drop me a PM...