Tuesday, September 21, 2010

Where is your money Invested?

I am a visual person.  I need to see charts to understand what is going on the markets, it's juts my nature.  For those not following the markets I have displayed a few charts below which should provide some clear insight into what is actually going on these days.  These are all monthly charts showing the past decade of price action.  Take a look:
Gold
Copper
Crude Oil
Sugar
Corn
S&P 500 futures
S&P 500 adjusted for US Dollar
The charts above show that commodity prices have been rising over the past decade while the stocks have gone virtually nowhere.  The last chart below is one of my favorites because it shows that when weighted against the US dollar, the S&P 500 has actually been losing money for 10 years despite a what main stream media would have you believe.

I post this so that those who do not have exposure to natural resources can see how they have missed tremendous opportunities for positive returns.  True, simply because gold has gone up for the past decade doesn't mean it will continue to go up.  Yet I beg people to think of where their retirement money is invested.  Are you really diversified?  If you don't have any exposure to precious metals these days, then you are not truly diversified.  Diversified into mutual funds and diversified into natural resources are often two entirely different beasts.  I urge you not to be complacent about your investments but to start to take an active role.  These are the days when we will plan our future and sadly a new course of action must be taken.  Apathy will be your worst enemy going forward.

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