T. Bills no longer safe / Invest in tangibles

It used to be the safest form of investment.  If a client wanted to invest money with no risk they would turn to Treasury bills.  Government grade debt.

Now with the government debt at such unmanageable levels, and with more debt to come, buying a treasury bill does not seem so safe.

China holds about half the US debt.  And with no real new money being invested in the treasury bills, the US has visited China to ask them to keep buying the US debt.
February 23, 2009

US Secretary of State Hillary Clinton Sunday urged China to keep buying US debt as she wrapped up her first overseas trip, during which she agreed to work closely with Beijing on the financial crisis.

Clinton made the plea shortly before leaving China, the final stop on a four-nation Asian tour that also took her to Japan, Indonesia and South Korea, where she worked the crowds to try to restore America’s standing abroad.

In Beijing, she called on authorities in Beijing to continue buying US Treasuries, saying it would help jump start the flagging US economy and stimulate imports of Chinese goods.

“By continuing to support American Treasury instruments the Chinese are recognising our interconnection. We are truly going to rise or fall together,” Clinton said at the US embassy here.

I was an investment advisor for  10 years and in the hedge fund business for 5.  People still ask me what I would be investing in these days.   My answer is simple.  Stay away from the  market, stay out of government debt.  Buy tangibles, eg gold or real estate.  The real estate market will go up and down too, its over time, population grows, space becomes limited.  Land and property will continue to become scarce.  Providing value.  If times get really tough, you can move into the investment property, you cant move into a stock portfolio.


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