Where to invest money when the sky is falling

 

Most of us know where to invest money in good times, but when it seems like the sky is falling, knowing where to invest money and how to invest it becomes a puzzle. In 2014 and 2015 it can be difficult to find good investments, especially if yesterday's good investments like stocks and bonds stagnate. This is not a prediction, but rather a "warning". You can't prepare if you're not conscious, so let's take a closer look at the sky.

We all know that safe options like money market funds and bank savings accounts don't seem like good investments for 2014 because they pay for peanuts. But what if the sky starts to fall: either interest rates turn up and / or the stock เที่ยวไหนดี? Either way or both ... where to invest the money is the question of the day. Safe options will seem like good investments for the parking money that should be safe.

Wall Street's traditional answer to where to invest the money: put about 60% in stocks and about 40% in bonds that keep a cash reserve on the sidelines. Problem: in 2014 and 2015 losses on stocks may not be offset by gains on bonds ... as was the case for the last 30 years. If interest rates soar from current record lows, neither stocks nor bonds look like a good investment.

For more than 30 years, interest rates were falling, and bonds were generally good investments. With today's ridiculously low rates (created by our government to stimulate the economy) a spike in interest rates is at stake (as the government undoes its stimulus). When that happens, bonds will no longer be the place to invest money for higher interest income in relative safety. Bonds are NOT good investments when rates go up; lose money. That's how it works. How To Invest In Bonds In 2014 And 2015 If Rates Take Off: Relax And Go Safe.

Stocks had been a very good investment for five years in a row since 2014 began. This was at least in part due to government stimulus and cheap money. In a sense, stocks were the place to put money because nothing seemed cheap except money (short-term interest rates were set at about one-tenth of one percent). With a gain of more than 150% in five years, the downside risk in the stock market is increasing. This raises the question of how to invest money in stocks if the sky starts to look sinister.

Remember that the stock market is actually a stock market, which means that the vast majority of stocks are affected when the market crashes, but at least some will be good investments. And the best way to find good investments in a bad market is to watch the price action. For example, when the market rose 30% in 2013, some gold stocks were down 50% in early 2014. If you don't know how to invest or how to choose a specific gold stock ... you may want to know where to invest money to get a part of this action. The answer is to invest money in gold funds and let them choose the gold stocks for you.

The bottom line is that in 2014 and 2015 investors face an uphill battle, because both stocks and bonds seem expensive. That presents a new challenge for today's investor looking for where to invest money. We face uncharted waters in this modern electronic world, where no one really knows how to invest or where to find good investments for the future. This includes large investors such as life insurance companies and pension funds.