Originally posted by baracuda
Omjee. Thanks.
Please suggest a few things:
1. Should I move out of Banking stocks.
2. Should I move out of equity completely.
3. Should I stop depending on credit and banking system.
4. Should we play short (sell $ and buy later) on Dollar to make money?
Please advice.
VC. |
Baracuda sir,
There are lot of people who do not like current fiat money system, working the way it is since 1971 (after Nixon made USD free from any link with Gold). Their arguments are mainly related to how money printing is abused and adverse impact of the same. These guys mainly prefer to go back to old system of Gold & Silver as currency.
However, in my opinion, these are just scary stories, nothing more than that. There are problems in many countries like we had in Zimbabwe in past and currently, a milder version, in Argentina and Venezuela. However, these problems are due to very poor economic policies and poor economic choices made and nothing to do with fiat currency. It is just too much to say that every inflationary episode is due to excess money printing, and, therefore, fiat money is bad and Gold is good. (As if there were no economic problems in ancient times when Gold was the currency).
So, my advise is to take it easy. There are going to be tough economic situations and I do agree that we will witness such tough economic environment very soon. However, moving everything out from banking system to Gold and hiding in bunker is not warranted.
For disclosure, I believe in keeping some of the networth (vary from 10% to 30%) towards non-INR exposure (by way of stocks of forex earners, foreign currency deposits, foreign stocks and preceious metals). But, this is purely as insurance towards bad economic policies of our politicians like AK and not for any investment gains.
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