Okay, anybody in Bonds right now is taking a huge risk, we know that. But what about those of us who want a safe haven from the coming dollar decimation and inflation? We just don't have sufficient fund choices. I'm not saying stocks are going to get hammered but I don't see the I fund as safe, even with the international component? Any thoughts?
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Safe Havens?
- Thread starter FordMan
- Start date
The dollar is sinking further. All of our fund options are dollar denominated. Is the I-fund really the best place to be? S&P 500 has lots of international exposure? Probably too late for a gold fund. I don't want a REIT fund? Currency options not available. What about suspending contributions to TSP and putting after tax money in Roth with Schwab?
robo
TSP Legend
- Reaction score
- 471
This is the best order for most people. Especially if your in the 15% tax bracket.
1. TSP matching
2. Max out Roth IRA
3. Max out TSP, and catch up.
I think we get 6k in 2008 for Roths if your over 50.
If you can max them all, but that's pretty hard for most folks.
Take Care!
Good investing/trading
robo - I completely agree w/ your ordering. TSP matching is a no-brainer. Roth IRA's are also excellent. It's just too bad they have an income limit and we're not allowed to put more in.
gwert - you're asking the exact same question I have. Where to put our TSP money w/ a declining dollar -- and even a potential collapse. This isn't doom-and-gloomer talk; it's just a possibility, but a signficant one, that should be faced.
I don't know!
The ideal would be a commodities fund. There are plenty of ETF's for this (i.e. dbc or ige), but we don't have any such choice.
It could be that stocks will go up (or hold their own) w/ a dropping dollar if foreigners snap them up on the cheap. But, a declining dollar and a hurting consumer faced w/ rising prices will also weaken the world economy.
International stocks would seem good, but China's market is _certainly_ going to burst. It's an obvious bubble and even participants are just going along for the ride and hoping to get out in time. Many are waiting till the Olympics, but who knows if a panic won't hit before then as smart money heads to the exits.
Bonds -- it would seem so since the Fed is cutting rates, but the longer-term rates have been going _up_ in contradiction. Rates may continue to rise to keep foreigners buying our debt while the dollar keeps dropping.
Then there's the G fund. Safe? It doesn't really even keep up w/ _true_ inflation (the housing bubble was never factored-in). And based on short-rates, and w/ a dropping dollar, it's losing it's real value.
It seems TSP participants have little choice. The gov't should just match our money and let us direct it into the brokerage we choose.
gwert - you're asking the exact same question I have. Where to put our TSP money w/ a declining dollar -- and even a potential collapse. This isn't doom-and-gloomer talk; it's just a possibility, but a signficant one, that should be faced.
I don't know!
The ideal would be a commodities fund. There are plenty of ETF's for this (i.e. dbc or ige), but we don't have any such choice.It could be that stocks will go up (or hold their own) w/ a dropping dollar if foreigners snap them up on the cheap. But, a declining dollar and a hurting consumer faced w/ rising prices will also weaken the world economy.
International stocks would seem good, but China's market is _certainly_ going to burst. It's an obvious bubble and even participants are just going along for the ride and hoping to get out in time. Many are waiting till the Olympics, but who knows if a panic won't hit before then as smart money heads to the exits.
Bonds -- it would seem so since the Fed is cutting rates, but the longer-term rates have been going _up_ in contradiction. Rates may continue to rise to keep foreigners buying our debt while the dollar keeps dropping.
Then there's the G fund. Safe? It doesn't really even keep up w/ _true_ inflation (the housing bubble was never factored-in). And based on short-rates, and w/ a dropping dollar, it's losing it's real value.
It seems TSP participants have little choice. The gov't should just match our money and let us direct it into the brokerage we choose.
but... let's cut 1/2 point w/ most indices just shy of record highs and the dollar sitting on major support. I guess it's the old "action speaks louder than words" thing.
The Euro as of this past Friday now costs a record $1.43. It came out at parity abt. 1999/2000. So, it's gained 43% since.
Divide your income in dollars by 1.43. That's how much poorer we've become (and few notice).
If a cup of coffee costs 1.43 x as many dollars in Europe as the US, and it's the same otherwise, then that's an imbalance that will correct itself. It'll get cheaper in Europe (dollar gains) or more expensive in the US (inflation).
Divide a barrel of oil: $80 / 1.43 = 56EU or $56 (1999/2000 valued dollars).
It's "the dollar stupid" (not directed at posters here -- just rhetoric).
The Euro as of this past Friday now costs a record $1.43. It came out at parity abt. 1999/2000. So, it's gained 43% since.
Divide your income in dollars by 1.43. That's how much poorer we've become (and few notice).
If a cup of coffee costs 1.43 x as many dollars in Europe as the US, and it's the same otherwise, then that's an imbalance that will correct itself. It'll get cheaper in Europe (dollar gains) or more expensive in the US (inflation).
Divide a barrel of oil: $80 / 1.43 = 56EU or $56 (1999/2000 valued dollars).
It's "the dollar stupid" (not directed at posters here -- just rhetoric).
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