Paul,
I think it was about a year ago, and on this thread, that I was saying complacently "it's not 1929" and pointing out all the mechanisms that will prevent a depression like that of the 1930s. I was immediately attacked by another member of SI for being too bullish, and for not expecting a crash of 90% in the market. I still don't expect another Great Depression, but the possibility of a 50% or better bear market seems much more likely.
Then later in the year, and especially after the burp of indigestion last October, I was attacked by people who seemed to think that the brief correction then was a fault of pessimistic thinkers.
Your dispassionate analysis, based both on logic and on a knowledge of economic history, is probably going to earn you some contemptuous and insulting treatment, especially if and when the market finally turns bearish. It almost amounts to a religious conviction among many now that a 20% per year growth of equity values is assured.
Incidentally, I am already (and, it turned out prematurely) heavily into oil stocks of all kinds. I realize that these, too, may be dragged down in a general market decline but gasoline is ridiculously cheap right now, if you look at the pump prices, and crude is a great bargain. I wish I owned an empty salt mine in Louisiana into which to horde crude oil. But royalty stocks, such as BPT, are nearly the same thing--and one can enjoy a decent income, even at depressed oil prices. Some gold and silver mining, too, and some Korea.
Mainly I am hedged against a crash of U. S. stocks. And like you, free of debt except for a small remaining mortgage. |
