Friday, 20 October 2017

The main beneficiary and loser in a downturn in economy.

When an economy suffering, wealth changes hands from the unprepared to prepare.

Scenario
1. Stagflation. Profit is the boss. Loss is a worker and saver. Therefore, we must prepare to be our own boss.

2. Deflation. Loss is boss and asset owner as nobody is interested in material goods and is more interested in the preservation of cash as their future cash flow is very uncertain.  Profit is liquid cash owner. The axioms - In the world of the blind, one eye jack is the king. Therefore, we must always have liquid cash in hand.

3. Hyperinflation. Loss is Cash owner. Profit is debtor and farm producer as well as those with a source of income from foreign trade or foreign exchange as well as the precious metals. Therefore, we must have a stake in export-oriented food commodity company or precious metal company.

So, in conclusion, the utopian dream is to be our own boss, flush with various foreign currency and ownership stake in plantation company or precious metal local and abroad to survive all eventuality.

"In God We Trust and Knowledge is Power"

Good luck! Amigo!

Yours sincerely,
Dr. Lion.

No comments:

Post a Comment