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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED
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To: habitrail who wrote (52587)6/4/2002 7:32:52 AM
From: t2  Read Replies (1) of 65232
 
Can stocks be trusted in a situation like the one you're outlining? Wouldn't they also tank if the money system is jacked up?

I bet Jim believes they will tank. I happen to differ on this point. Stocks can be trusted more than bonds/cash, imho. Devaluation of a currency hits bonds/cash. However, the worth of a business is not totally linked to the value of the dollar. Just look at what happens when the YEN gets devalued...the Japanese auto stocks gain. Maybe it won't happen here but I would think bonds/cash would be worse than stocks, if one looks at it from the point of view of a European or Asian investor. There was some report out yesterday that suggested stocks should do better in a weak dollar environment..it was bearish on bonds.

Although I am very bullish on Gold, I do think there is a possibility that we could see a big surge in big cap multinational stocks while the dollar drops as investors pull out of bonds...which totally tied to currency.
I believe it is just a matter of time before the massive shift out of bonds and into stocks takes place. Not all the money out of bonds would go into US stocks but some will...and it won't take too much of it push the stock market higher....lead by big caps.

Best bet still looks like gold though as it is sure to gain as the dollar weakens while the stock market will possibly gain,imho. Among stocks, I still like big cap tech along with consumer stocks that depend a lot on foreign sales.(don't trust drug stocks though)
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