The Freedom Factory

We are moving closer towards a political economy every day. Every dollar borrowed, taxed, printed, and spent by government really comes from the private sector.  Trillions of dollars of national resources are being allocated by politicians and bureaucrats towards things they claim will benefit our economy. Congress just passed a $3.6 trillion budget ($1.2 trillion in deficit), and combined the Federal Reserve and Treasury have dumped $13 trillion into the economy in the last 16 months. What we must all ask ourselves right now is whether or not we trust government with our money? Continue Reading

In “How to Protect Against Inflation and a Crashing Stock Market” I discussed several inflation-protection strategies. These included diversifying into stocks, holding commodities and real assets, selling long term bonds, sticking to shorter maturity debt, using TIPS, and employing basic portfolio insurance techniques. Well, the story gets better for investors with the introduction of two new ETF’s that specifically short bonds. Continue Reading

Iron condor credit spread strategies are particularly vulnerable to severe market movements, either up or down. For a portfolio predominantly allocated towards this trading strategy there are certain steps one should consider to protect against potentially catastrophic events.

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I’ve been hearing some glum news of late, many a bloke predicting the imminence of a severe market crash. The bad news seems to come in daily: round two of credit crisis, global inflation exceeding expectations, and real estate prices and sales volume spiraling lower.  Throghout this mess U.S. stocks, as measured by the S&P 500, are down roughly 14.5% since last October, and long term bonds, as measured by the Lehman 20+ Year Treasury ETF (TLT) have dropped 7.5% off March highs. Just as markets seem to be hanging precariously on edge, central banks are whispering about potential rate hikes to stem inflation. Regardless of the direction markets take, there are definite steps prudent investors should take to protect themselves.

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