1.) It cost me nothing to liquidate
2.) If cash turns out to be worthless what are stocks going to be worth?
3.) I agree that timing the market is a fool’s errand, but as I said we are now in a ‘new normal’ where the old rules no longer apply; this is a one-off situation.
4.) If the DOW only falls to 9k I will be surprised.
If gold is worth 2000 dollars per ounce and the dollar loses value to the Yen or something. Say the dollar loses 50% of its value... how many dollars is the ounce of gold worth?
If a company is worth 2 billion dollars and the dollar loses 1/2 of its value, how much is the company worth?
If an annuity is worth 50,000 dollars and the dollar loses 1/2 of its value, how much is the annuity worth? Its still worth 50k dollars which are now worth 50 percent of what they were.
If a rent house is worth 100k and the dollar loses half of its value... how many dollars is the rent house worth?
If a dollar is worth a dollar, and the dollar loses half of its value... how much is a dollar worth?
The cost of liquidation includes missed opportunity so there is always a cost to liquidate.
More importantly when you choose stock in companies that have a stable product line with a good revenue stream the stock is worth more than money. Your position in the company shields you from inflation that will ravage the money you are holding. If we are bombed back to the stone age both money and stock will fail. On lesser events at least in the market the % you have invested in companies that survive will retain value and rise as the economy repairs while your money will need to be ferried in wheelbarrow loads to purchase anything.
The misconception is that money is of value in its own right. Businesses actually hold intrinsic value money does not. Dotcoms and social media are not conservative investments but conservative investments are not difficult to discover.
>1.) It cost me nothing to liquidate
>2.) If cash turns out to be worthless what are stocks going >to be worth?
Since 2008 we have been involved in a world currency war.
The latest salvo was QE Euro. Soon US companies will force
QE4 US to rebalanced profits.
To me the big number is the unfunded US entitlements.
Not enough dollars exist in the world money supply to pay
these entitlements. We are now ranging into the payout of those entitlements and into the inflation printing money to pay them. Thus like in the 70s your dollars will buy less and less, while real assets will hold real value.