Editor’s Note: Today’s Daily is different. I came across an old essay by former hedge fund manager and Jump Point Trader editor, Teeka Tiwari. He wrote it in August 2012. At the time, it felt like the entire world was on the brink of collapse. Stock markets terrified most investors. But as these investors sat it out “on the sidelines,” the markets have gunned over 50% higher in the time since. It’s an important lesson for investors fearing today’s similar scary headlines…
From Teeka Tiwari, editor, Jump Point Trader: Massive loss of wealth, loss of income, and loss of freedom.
That’s the mantra of just about every newsletter headline I read these days.
I’m not naïve. I understand fear sells. But what would be much more valuable is a series of strategies for seeing our way through these tumultuous times. Strategies that do not revolve around trading in all our assets for gold and silver coins and buying up an arsenal of guns.
Today’s hysteria for gold and guns reminds me of the Y2K doomsayers. Do you remember how many folks were predicting the end of Western civilization because computers would fail to recognize the year 2000? The folks who were selling electric generators, guns, and food rations made out quite well… but their customers?
Not so well.
Now, owning gold is a viable strategy. (Back when gold was $750 per ounce, I was calling for $2,000 gold. It peaked at $1,900 and change, and I think we’ll see prices far in excess of that by the time this whole easy-money cycle is over.)
But it’s important to maintain a sense of proportion. Yes, there is opportunity to be had in some of the doom-and-gloom plays, but it’s a mistake to bet the ranch on the idea that America will crumble into the ocean and become a burnt out shell of its former glory.