Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Crash Opportunities, Broken Printing Presses, Cattle and Hogs

Stock-Markets / Financial Markets Sep 03, 2008 - 05:46 PM GMT

By: Paul_Lamont

Stock-Markets Best Financial Markets Analysis ArticleAs we mentioned two months ago , a speculative commodity bust would fit with the onset of a deflationary collapse. During the month of July, commodities began this correction with the largest monthly decline in 28 years . They are still falling. Similarly, Lombard Street Research 's measure of M3 fell in July the most on record (since 1959). The chart of the percentage change in money growth is below.


The banking system is currently broken. Without credit, asset prices fall and money is hoarded. The risk is of a Great Deleveraging of the economy. We still recommend U.S. Treasury Bills for the preservation of one's portfolio . That being said, in the first part of this series, we would like to mention other investments (even some commodities) that could appreciate during this deflationary period. In the second report, we reveal what investments could present a better buy at the bottom in 2010-2011.

***More For Clients and Subscribers***

Cattle and Hogs

We also believe livestock could rise during the next few years.

The main costs in raising hogs and cattle; gasoline, corn feed, and labor are all falling. Due to recent financial innovation, there are ways to invest in these price trends without owning a farm or purchasing commodity futures. However the option available to U.S. investors, exchange traded notes (ETNs) offered by Barclays and UBS, have a major flaw. They are subject to credit risk, as they are little more than bets with the bank. So while you may be correct in the price rise, if the bank goes down or defaults, you will not receive your winnings.

In 2005, Jim Rogers' commodity funds at Refco (“wrongful” handling or not) were also similarly unavailable for redemption. In the current environment, these atypical risks become more probable. In our view, investing in companies that sell pork or beef is also unadvisable. The inability to pass a higher price along to the consumer could become an important problem. A companies' debt woes could also be fatal. Instead, we prefer to take possession.

Inverse Stock Index Funds

Speculative investors may also want to consider inverse stock index funds. These funds rise in value as the market goes down. We offer a Bear Market Strategies Account in which the bulk of your funds are protected with U.S. Treasury Bills, the remainder positioned in speculative inverse index funds. This can possibly hedge business owners from a recession or attempt to provide a little better return for investors who are still saving for retirement. The suitability of this account depends on your risk tolerance. It is not for everyone. In an environment where institutions are failing, counterparty risk is also a major concern. Please contact us to further discuss the risks of these funds.

***For disclosure purposes: At the time of publication, Paul Lamont holds positions in UVPIX and RYUCX.***

Sixty Years Ago…Another Dark Hero

With The Dark Knight breaking box office records this summer, we were reminded of another movie .

By Paul Lamont
www.LTAdvisors.net

At Lamont Trading Advisors, we provide wealth preservation strategies for our clients. For more information, contact us . Our monthly Investment Analysis Report requires a subscription fee of $40 a month. Current subscribers are allowed to freely distribute this report with proper attribution.

***No graph, chart, formula or other device offered can in and of itself be used to make trading decisions.

Copyright © 2008Lamont Trading Advisors, Inc. Paul J. Lamont is President of Lamont Trading Advisors, Inc., a registered investment advisor in the State of Alabama . Persons in states outside of Alabama should be aware that we are relying on de minimis contact rules within their respective home state. For more information about our firm, or to receive a copy of our disclosure form ADV, please email us at advrequest@ltadvisors.net, or call (256) 850-4161.

Paul Lamont Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in