Now Is The Time to Be a Cockroach
July 20th, 2018I definitely wouldn’t count on banks and cash, as she suggests, but this is an OK article to share with your “normal” family and friends who might perceive the current economic situation as A-OK.
Once people understand that things are not A-OK, that would be a good time to explain what a bail-in is.
Via: Erica Douglas:
We are, right now, in a state of economic expansion that has lasted for 10 years. Having lived through two major downturns (2001 and 2008) as an adult, I’ve trained myself to recognize the top of the market. And though I may be wrong, I feel confident in saying we are at the top right now.
That does not mean the economy will not continue to expand. “The market can stay irrational longer than you can stay solvent,” John Maynard Keynes wisely said. Timing the market is extraordinarily difficult.
I closely watched the financial news during the last two economic expansions and contractions, and for the last 3 months I’ve seen the same indicators I saw at the top of those two expansions.
So, if we’re not at the top, the markets will certainly only get more irrational and frothy from here.
Why do I mention all of these economic indicators? Because now is the time for you to start being a cockroach.
You should irrationally focus on profitability and putting as much money into the bank (liquid cash) as possible right now. And from a personal level, you should be focused on paying down debt, not taking on new debt, and stacking as much cash as you possibly can. Get money now while the economy is at the top.
As much as you can given your time and health, take on paying gigs now. Then put that cash in the bank and keep it there. You will need it when the economy tanks, whether that’s later this year, next year, or 2-3 years from now.
@Kevin
Regarding your comment about banks and cash, I found out yesterday that the Australian government has opened the door to the possibility of bail-ins: http://digitalfinanceanalytics.com/blog/sold-a-pup-the-bank-deposit-bail-in/