3 ms·

Is it going to be a GFC style crash where I want my assets in currency denominated investments (e.g. bonds) to buy assets at crazy low values or is it going to

by HWR_14 7mo ago

Is it going to be a GFC style crash where I want my assets in currency denominated investments (e.g. bonds) to buy assets at crazy low values or is it going to be mega-inflation where I want my assets in commodities and stocks?

danaris 7mo ago
Ah, HN. "There's likely to be a global recession, driving millions of people to destitution and starvation and thousands to death. How can I profit from this?!!!"
- hypeatei 7mo ago
  I think it's more protecting ones wealth rather than profit. But sure, I guess only people on HN try to do that.
- scoofy 7mo ago
  Wait, what?!? Nothing about trying to strategically put yourself in an ideal situation during a recession is going to make anyone else worse off. Much of this isn't zero-sum, and assuming the investments are not rent seeking. If I were to invest in potatoes because I thought people might need potatoes, then there should be an incentive to make more potatoes, and if people need potatoes, then more potatoes are likely to exist... which helps people get food. If I instead concern myself with clutching my pearls and tightly as I can, and I don't invest in potatoes, then there is less of an incentive to make more potatoes, fewer people are able to buy the limited supply of potatoes, and everyone is poorer for it.
Ekaros 7mo ago
I am not going to use this strategy but my guess is first the first then the second. Stocks seem to be already on very high levels. Commodities might fare less well as oil is major input. So high prices probably lead to less demand to lower prices or at least combating the cost increases from oil as input.
jjav 7mo ago
I have no idea, so I have short term bonds, and gold, and commodities, to diversify.
roryirvine 7mo ago
If there was a definitive answer to this, don't you think that the markets would already have moved to account for it?
- M95D 7mo ago
  But they did! Look at the gold price.
  - OgsyedIE 7mo ago
    Not just the price, the physical volumes. China's central bank has been discounting their bonds beyond what the market can support in order to get more free cash to buy up as much metal as possible as soon as possible, to the point that people are making millions this month just in the arbitrage from buying up everything in the London and Chicago exchanges to give to China.
- HWR_14 7mo ago
  It's entirely possible that there could be an answer for which type of recession to expect but it still might not be priced in. For instance if many people think the recession is going to happen in 2028 and I think it will happen next month, we would have very different investments.
hypeatei 7mo ago
Just keep in mind that we've had three 20% drawdowns in the past five-ish years that have all recovered. Even if we do have a crash, I don't think it'll last long. But, this war has thrown a wrench into things and I don't think AI spending can carry us through this year, so who knows.

by HWR_14 7mo ago

danaris 7mo ago

Ah, HN. "There's likely to be a global recession, driving millions of people to destitution and starvation and thousands to death. How can I profit from this?!!!"

hypeatei 7mo ago
I think it's more protecting ones wealth rather than profit. But sure, I guess only people on HN try to do that.
scoofy 7mo ago
Wait, what?!? Nothing about trying to strategically put yourself in an ideal situation during a recession is going to make anyone else worse off. Much of this isn't zero-sum, and assuming the investments are not rent seeking. If I were to invest in potatoes because I thought people might need potatoes, then there should be an incentive to make more potatoes, and if people need potatoes, then more potatoes are likely to exist... which helps people get food. If I instead concern myself with clutching my pearls and tightly as I can, and I don't invest in potatoes, then there is less of an incentive to make more potatoes, fewer people are able to buy the limited supply of potatoes, and everyone is poorer for it.

Ekaros 7mo ago

I am not going to use this strategy but my guess is first the first then the second. Stocks seem to be already on very high levels. Commodities might fare less well as oil is major input. So high prices probably lead to less demand to lower prices or at least combating the cost increases from oil as input.

jjav 7mo ago

I have no idea, so I have short term bonds, and gold, and commodities, to diversify.

roryirvine 7mo ago

If there was a definitive answer to this, don't you think that the markets would already have moved to account for it?

M95D 7mo ago
But they did! Look at the gold price.
- OgsyedIE 7mo ago
  Not just the price, the physical volumes. China's central bank has been discounting their bonds beyond what the market can support in order to get more free cash to buy up as much metal as possible as soon as possible, to the point that people are making millions this month just in the arbitrage from buying up everything in the London and Chicago exchanges to give to China.
HWR_14 7mo ago
It's entirely possible that there could be an answer for which type of recession to expect but it still might not be priced in. For instance if many people think the recession is going to happen in 2028 and I think it will happen next month, we would have very different investments.

hypeatei 7mo ago

Just keep in mind that we've had three 20% drawdowns in the past five-ish years that have all recovered. Even if we do have a crash, I don't think it'll last long. But, this war has thrown a wrench into things and I don't think AI spending can carry us through this year, so who knows.