Daily Speculations

The Web Site of Victor Niederhoffer & Laurel Kenner

Dedicated to the scientific method, free markets, deflating ballyhoo, creating value, and laughter;  a forum for us to use our meager abilities to make the world of specinvestments a better place.

 

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1/18/05
Twenty-First Century Options for Saving, by Kim Zussman

Over the weekend noticed a pattern which has worked historically most of the time and missed big so far in 2005. At the beginning of each year, presumably there are lots of folks with bonuses deciding how to allocate them. Besides discretionary spending, there was the 1990s paradigm, "save for kid's college and your retirement", which has morphed into "save for kid's college, adult support, children of children, all of their retirements, as well as your own long-term care." Perhaps these increasingly formidable goals give pause to investors. What are the options for the few still interested in saving?

1. Living stock investors have now experienced the meaning of risk mysteriously at the same time Jeremy Siegel went missing.

2 Real estate, in line with supply/demand and Dr Greenspan's equanimity, will soon be only affordable on Saturn's moon Titan (which as a bonus has an even larger hydrocarbon reserve than Al Quada).

3. Bonds in an increasing rate environment may not be that great for those who can't work binomial trees on their slide rules.

4. Gold is nice and shiny but has had a good run. Besides there is no longer anything to fear since now the U.S. rules the world.

5. Hedge funds are now available even for smaller accounts, especially those interested in paying fees-on-fees on funds-of-funds. Maybe they will introduce new Der Expert puts so we can leverage truth and justice right up to the moment the sun goes red-giant (astrophysicists working at funds have precisely calculated the date).

6. The Investment Piker might suggest a basket of commodities, such as oil, lead, iron, plutonium, tincture of neutron star, computer software, health care, and Internet-based fine literature. In this way budding consumers in China will keep buying US treasuries to support their currency and be able to afford our raw materials to make things to sell back to us at Wal-Mart.

As lamented to one's children, the adult conundrum is decision under uncertainty. Mama!!