Preserving capital?

[dantm2000]

Say you were smart enough to get out of the market a while ago and are now sitting in cash.

What would you do to preserve it (forget about growing it) in light of possible inflation/etc.

Thoughts? Is there a 'safe heaven'?

Thanks!

 

[hoodooman]

cd's

 

[dantm2000]

What about inflation in case it happens, will CDs track up with inflation?

Do you guys know what happened in the 80s when the inflation was really high? Were guaranteed investments keeping up with inflation?

 

[hoodooman]

Treasuries had higher rates than cd's in the 80's. Highest rate on cd's was 10%. Treasuries 13%.

 

[PAPA ROACH]

20% in cash or cash equiv's

20% in ammunition ( a great store of wealth, very usable and in demand if the shit hits the fan)

20% gold

10% misc

30% raw land

 

[dantm2000]

Quote from hoodooman:

Treasuries had higher rates than cd's in the 80's. Highest rate on cd's was 10%. Treasuries 13%.

What was the inflation when CDs were 10% and T-bills 13%???

 

[hoodooman]

Based on my salary increases at the time based on inflation, it was 5%. What a crock that was.

 

[dantm2000]

hehe, what a scam...

Found it:

"Inflation reached 9.1% in 1975, the highest rate since 1947. Inflation declined to 5.8% the following year, but then edged higher. By 1979, inflation reached a startling 11.3% and in 1980 soared to 13.5%."

So 10% CD with 13.5% inflation is not that dramatic (still bad, but not hopeless).

 

[dantm2000]

Interestingly enough the CDs had reached pretty high rates in the 1980s, I saw 14 - 18%...

 

[Div_Arb]

Quote from PAPA ROACH:

20% in cash or cash equiv's

20% in ammunition ( a great store of wealth, very usable and in demand if the shit hits the fan)

20% gold

10% misc

30% raw land

You forgot 20% canned goods