It’s for times like these that Bitcoin was created!
Although BTC lost its way occasionally, it exists to protect our wealth from bad economic times and to protect us from governments with bad economic policies.
I have spent the last 18 months discussing the need to create a diversified portfolio encompassing financial instruments and secure investments outside of capital markets.
I discussed buying Bitcoin, on a scale-down basis, under 20,000, but it was a gamble considering many commentators had given up and were looking for 10-12,000. Luckily, I managed to get some onboard at an average of 18,200, and although I sold half of my exposure at 23,000, I still have half the position, and happy I didn't sell it all.
Old School - I have also promoted buying physical gold since the end of 2021, which I am grateful I did. I am also happy that I added some agricultural land to my holdings, especially as it already provides my family with cheap eggs and tomatoes. Going into the supermarket is almost as bad as visiting the petrol station!
It's not all been rosy though, I gave a bit back on a couple of speculative trades, but because I managed the risk, the losses were negligible.
To complete the theme of my reports over the past year or so, whilst I managed to maintain an income in both dollars and Euro, I haven't exposed myself to BRIC currencies as much as I had hoped, but I will continue to look for ways to do that with which I feel comfortable.
Those who read my reports regularly will know I have a few properties in Portugal which I rent on AirBnB and Booking.com. I managed to get through Covid, which was a worry, but luckily, with local tourism, I managed to come out of the disastrous covid period with a profit.
Regarding this part of my income, I am considering reducing what I do in tourism as a forecast collapse in disposable income over the next few years might be brutal for the tourism industry.
That's how my portfolio is balanced. Although it's not perfect, it suits me and it's a mixture I can handle.
I have been surprised that grains and beans (foodstuffs) have yet to take off, but I am not giving up on this sector yet. Food demand is going to continue, and the balance in supply and demand doesn't have to change too much for these commodities to turn very bullish.
I didn't entertain treasuries or equities, and as things are developing today, I am glad I do not have those headaches.
Some companies might see decent gains, as will some cryptocurrencies. Still, I have never been a stock picker, so as I don't see much upside on equities, I will ignore the eternally bullish pundits and keep on the side lines.
Some readers will want to read something more dynamic, and younger investors will probably want me to promote more high-risk strategies, but there is a time and a place, and at this moment, being a little defensive is a good idea.
That said, I have not run away from speculating completely, or at least not run away from the markets.
There will be a lot of good short to medium-term speculative opportunities to exploit, so I have placed a bit of capital with fund managers who have experience and are supple enough to move in and out of the markets to steal a few pennies. Normally, I couldn't do this because the minimum amount of capital most major fund's demand is higher than I want to give to one fund.
However, the guys at Sterling Gent and trademakers have launched their Fractionalised Investments portfolio, which allows me to enjoy the returns of a professionally managed program, but with less capital and fewer fees.
These Fractionalised Investments are perfect for what I want, and I can move my capital from one fund to another at a minimal cost. You do not find fractionalised investments in most places, so if you are interested, check them out.
Finally, I was going to write about the events at SVB and Signature, which was hardly a shock.
I didn't see these particular banks having problems. Still, banks are the most regulated entities we have, and as politicians impose these regulations, we know, sooner or later, we are going to have problems.
2008 was a result of Bill Clinton making policies which encouraged banks to lend more than was prudently sustainable to people whose ability to pay was questionable. The current problem derives from politicians printing and spending money without considering the long-term effects. The long-term impact was inflation, and with inflation, the value of Government bonds decreases, and margin calls become more likely.
How we will solve the current dilemma is still to be determined. Printing more money and creating more debt, which we did in 2008, will simply throw more petrol on the fire. It's a bit late for belt-tightening, and under the socialist leadership we have, it is going to be impossible for these leaders to change their spots. They will not stop spending your future income to buy your votes.
We need to go into recession and see our western currencies collapse, which is the only way to pay off our Dollar and Euro-denominated debts.
A full-blown recession or depression is hardly satisfactory, as it will cause economic mayhem. But with anaemic growth forecast, I would like to hear your opinion on how we will come out of the current problem, especially with other powerful nations happy to kick us when we are down.
Luckily, those of us in capital markets have options.
Use them wisely.
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