The aftershock investor

a crash course to staying afloat in a sinking economy
by David Wiedemer PhD
robert a. Wiedemer
cindy s. spitzer
isbn: 978-1-118-07354-4
www.aftershockpublishing.com

notes
"recovery" is still driven by government borrowing and printing. take away either one and we would be in a deep recession.

Investment outlook as of June 2012

• Stocks -likely volatile. In past have dropped after QE ended. worth looking into high dividend stocks of stable, conservative large-cap companies such as electric utilities, johnson & johnson, procter and gamble worth looking at in conservative portfolio. less potential for short-term growth, but also lower long term risk
• bonds - interest rates are as low as they can go, meaning potential for capital gains from bonds is pretty slim. recommend keeping shorter-duration high quality bonds, such as 2, 3, & 5 year treasuries. special bonds such as TIPS. ETFs such as TIP and MBB (for mortgage backed bonds)
• Europe - expect European Central bank to print more money
• international equities. probably not worth the risk of longer-term hold
• gold - likely to have explosive growth? see www.sprottphysicalgoldtrust.com/NetAsssetValue.aspx
• Silver and commodities, more volatile than gold in short-term and likely to go up in time. possible upward in commodities with inflation

real productivity growth is slowing down here and world wide

probably inflation and not deflation

Fed will continue QE for market stabilization, foreign currency markets stabilization and government spending deficit.

money managers investing in stocks are managing OPM and want to keep their jobs.

Valueing stocks
P/E, price to revenue ratio, book value/liquidation ratio, private company valuation,

high dividend stocks such as electric utilities work best in a market that is moving upward at a slow rate but with high volatility. (Monitor consumer price index at www.bls.gov)

Real estate; fixed rate mortgages, only make minimum payment, avoid HELOC

income producing rental properties. Rents eventually track re values, decreasing employment may decrease rent, squatters decrease rent

necessities sector; health care, education, food, basic clothing, transportation, government services, utilities

portfolio strategy; preservation of capital, minimal volatility, reasonable returns
portfolio components; gold, high dividend stocks, shorter term treasurys, TIPS, foreign currencies, commodities, short stock ETFs, short bond ETFs

government intervention will be most important factor affecting your portfolio

understand short selling, put options and LEAPS