Investment advice from a 19 year old
Commodities baby. Sinking dollar + increasing global demand = hedge against failing government fiat currency, and a chance to profit. Short term, they might go through a pull back, but don’t let that discourage you. We haven’t begun to see the inflationary effects from helicopter Ben’s rate cuts. This money that is flowing into commodities is merely the remaining wealth that didn’t get destroyed in the housing collapse. Two stocks I particularly like are the uranium explorer URZ and oil exploration/producer GTE.
I also like corn. I don’t think the market has fully priced in the effects of the recent floods in the nation’s heartland. With the government paying our farmers to produce corn for our gas tanks, other commodities will continue to rise due to more farmers ditching soybeans, wheat, ect. for corn.
Also, short the financials. They’ve still got alot of bad debt on the balance sheets and are understating it because they are trying to raise capital like crazy right now. It’s a bear market folks and I expect to see the dow at 10,000 by the end of this year. With socialists prospects like McCain or Obama, it’s a lose lose situation for the greater economy, but there is and always will be a bull market somewhere. Oh, and I’d recommend having about $1,000 stashed away at home in case all hell breaks loose and more banks start to drop. Also, buy some precious metals while they are still relvatively cheap. There’s going to be one heck of a bull market coming down the road for them.
The fed is in no position to raise rates, but eventually they are going to have to, to fight off inflation. This rise will further drop house prices, hurt banks with tons of mortgage assets, force more forclosures, and tighten credit. All of these things will weigh on the economy in 2009. We could go through a period worse than the late 1970’s.