A lot of folks are pointing out how this year seems to closely resemble last year, in terms of the stock market, the need for cash, and U.S. treasuries being bought up. The 5 minute forecast had a good graph showing this a few days back.
http://www.agorafinancial.com/5min/the-ghosts-of-2008-gold-stocks-a-curr...
If you will recall last year cash was king (it still is for the moment) and Gold came in a nice 2nd place by the end of 2008. Even if we have a repeat of last year, let me tell you why I still opt for a respectful 2nd place.
What if we have a bank holiday and the currency is devalued? We already have more debt to gdp then Argentina when their currency lost 2/3rds over night. Our government is already talking about a 2nd stimulus! What if the US defaults? What if something else crazy happens? And one that isn't a "what if” is that the BRIC countries are openly talking about getting away from the dollar.
With out a doubt in my mind we will see a lot of inflation within the next couple of years. Why wait to protect yourself? If you are in cash, be on your toes. If an opportunity comes to get on something cheap, do it (better study what cheap is). But as people trust our money, government, and financial institutions less and less I wouldn't expect being in US dollars will be a good thing at some point in time. That time could be sooner then we think.
2nd place sounds pretty good.
