Americans Are Still Asleep

[feluisak]

The secret to surviving the next few years is keeping your wealth in real
money, not in the U.S. dollar. Buy things that hold their value and are
exchangeable all over the world. Commodities such as gold and silver have a
world market that transcends national borders, politics, religions, and race.
A person may not like someone else's religion, but he'll accept his gold.

My concern is that very soon, citizens of the world will tire of America's
gross fiscal mismanagement and hesitate to take U.S. dollars. In order to
keep the world interested in the greenback, interest rates must rise. When
that happens, U.S. assets, especially paper assets such as U.S. stocks,
bonds, mutual funds, and savings will drop in value. Some real estate prices
will increase because replacement costs are high, but overvalued real estate
will drop.
At the risk of sounding like a politician who flip-flops, there will still be
paper assets and real estate that will rise in value. The secret to surviving
in paper assets and real estate is to be very careful and very selective.
People who diversify will lose. People who focus will win.