You know what one of my strategies is to avoid being squashed, right?
A rap this morning in response to a reader inquiry from a recent radio appearance:
On C2C George spoke briefly about the “bail in” when the market drops and said he would be moving into “treasuries” ? Bonds? I need more info. Very much enjoyed the show. Thanks
Here’s my thinking – subject to revisions (as always) should problems with the idea occur.
I have my financial life set up to operate as smoothly and hands-off as I possibly can.
Life if for writing books, columns, flying, travel, cruises, gardening, shop projects…anything but spending an inordinate amount of time on what? Accounting.
So back in 2003-2005 I was telling Peoplenomics subscribers about my simple way to get ahead in the world and it really came down to three asset classes.
One was Gold, one was Bonds, and this third leg of the milk stool was rural/agricultural real estate.
Why did I pick those? Simply because the role of “money” is to facilitate transactions. The role of “wealth” on the other hand, is to move accumulated “money” safely forward in time with its purchasing power intact.
And, it has worked like a charm, compared to the general level of inflation (he said, acknowledging that Keynesians only seem to rule, but Monetarism still has a strong franchise).
Now days, however, the game has really changed.
Nowadays you need to a) insure you have transactions covered, b) move “wealth” forward in time, and the new problem: c) Avoid penalties and confiscations.
M y solution? And we’re certainly open to discussion on this: We have three linked accounts.
One is the bank checking account, second is the trading account, and last but not least is the TreasuryDirect account.
If you don’t have a TreasuryDirect account, you can click over to their website here (http://treasurydirect.gov/ ) and learn about their products..
The one I have happily used has been the inflation-adjusted Savings Bonds, series H I think, but remember the brain solvent (coffee) is still ramping up.
All of these accounts are “linked” and I have done test transfers between them.
Now, let me explain the reason.
Let’s say that in my circle of friends, including Robin Landry, the wisdom is that the Monday or Tuesday we get back from our cruise, the market breaks down past the 1,740 level.
IF that happens (and I think it’s only a 30 percent probability) then we start sliding in the direction that Greece and Cyprus have been through.
Remember in those what happened was banks did “bail-ins” which amounted to a special one-time theft of a portion of accounts, weighted more heavily against large accounts.
I also seem to remember, though, that bondholders in Greek Government bonds didn’t do as badly, although they took a haircut on yield.
The missing piece is what happened to money in Greece stock market (or money market) accounts at the same time?
Here’s the theory: What’s going on in Europe is that the European Central Bank is doing dark alley hold-ups of smaller countries in order to take over their local central banks. Which, in effect, is what happens when you can screw the savers in formerly independent countries.
The way to avoid the involuntary sex with the bank? Don’t be there.
And that’s why I am looking at different ways to “push-button” my money around – just in case.
Other weird ideas?
Sure, under the ultimate a stress, savings accounts might be impacted, But, would banks be able to impound a prepayment to a credit card account?
The way banks are changing their “Terms and Conditions” here lately is making me nervous.
If things in America, during a great financial upheaval, were to head in a Greece or Cyprus direction, I want to have pre-planned a number of linked accounts.
Because although it may seem like a hybrid between hare-brained and hair-trigger, that’s the penalty I pay for living 10-minutes in the future.
If you ever go out and play in the street, you may be able to confirm this thinking: It’s better to move before the truck runs you over because it may not be as easily done after.
Safer Flying Department
If you’re the kind of person who lets the car keep on going past the recommended time to change out the timing belt, then you are not pilot material.
On the other hand, if you have a time-sensitive part, like an airplane magneto that has a 500-hour service interval, and has 490.5 hours on it, you don’t go off on any long cross country trips, as we will be doing later this month, without having the recommended service done.
If you change the brakes before they squeal, you are pilot material. If not, you might want to think another hobby…the kind where you don’t fall and maybe where you can’t sink.
Was this a simple test, or what?
I’d like to thank Waylon up at Mags E.R. up in Arkysaw for the quick turnaround and test report. This morning, Jeremy the Mechanic will be doing the installation and we should be airborne shortly thereafter. (Friends give friend link juice.)
We’ll also finish the panel removal and fragment check which took a back seat to an AOG jet. *(AOG=aircraft on ground, not to be confused with OAG which is the Official Airline Guide, or OAT which is outside air temperature, or ATC which wants me to change to another frequency now…)
Small four place used single engine planes are still twice as fast and half the initial cost of a new decked out pick-up truck. If you’re in passable physical shape and don’t mind 15 MPG at 170 MPH in a straight line with no radar traps, then yes, you can either dream it or do it.
Most flight centers have “introduction to flying” sessions for $100-$125…and yes, you get to actually fly the airplane for 20 – 30 minutes of that with most.
Changes at UrbanSurvival
We may have some “down time” Friday or Saturday morning with either UrbanSurvival, Peoplenomics, or Rural Pioneer, and maybe Nostracodeus.
Tomorrow we will be flipping over to the newest version of SQL for security reasons and it’s always like trying to brush your teeth with a straight razor whenever you start changing environment variables…but we shall see.
Then, some later this month (like when we get back from the cruise) we will be going to a small format revision which will mean two clicks for your daily Ure articles.
The reason, sayeth the experts, is that we get penalized by search engines for being too wordy.
Not that the Coping section is bad, it’s just that it’s on the same “page” as the “regular” content. What that means is that the page size gets too big and SEO gets knocked down.
Sorry about that, but dealing with the web is a lot like the patient going to the psychiatrist. There is often times nothing wrong with the patient. They just have to adapt to what the doc’s way of thinking is. Kinda like that with search engine optimization.
Chris Tyreman, author of 100 Questions You Never Thought to Ask and Didn’t Want the Answers To., and “face” of the www.thechronicleproject.org has agreed to do the cover for my book DreamOver which is being proof-read by one of the characters in the book, right now.
Seriously: Long-time bud of mine up in the Northwest was a kind of outline for one of the characters and he’s doing the proofing. Bet’cha that’s a first, huh?
Speaking of firsts…
Had a marvelous conversation/podcast interview with Peter Pham, who write and pods (*if that’s a werd, lol) for Forbes. UrbanSurvival earned a Forbes Best of the Web back when, but somehow that evaporated…not sure how often it’s updated.
Meantime, Pham and I have huge overlapping interests in how to most cleverly use Big Data to make better investment choices. Some of his thoughts on it over here.
Peter’s podcasts are available from iTunes, over here: https://itunes.apple.com/us/podcast/the-big-trade-series/id952345306?mt=2
Hmmm…well, there you go, coming up on 1,400 words, which is too long for a single post (ideal is less than 800 words sayeth Big Data). But they don’t know how much screwing around either one of us does at work.
But I won’t tell, if you don’t.
REMINDER: Short column Monday due to US markets closed for Labor Day . Wanted to mention it while we’re both in condition to remember.
(No, that was not an alcohol reference. That was a sleep in for a change reference, but take it as you will.)
Write when you
get rich break-even,