Haydn's Notes

Here are the notes that I sent to Haydn on the YBW thread yesterday:-

Cash is king right now. Gold should have a very long way to go but there is risk. Gold sovereigns or brittanias are best for tax but most dealers are out of stock with huge backlogs. FTSE headed to an interim low of 3500 by the end of this month. Residential property down. Most commodities down. Gilts/Treasuries - with all those cash injections will they retain their AAA rating? Normally they epitomise safety but that's no longer true. There is a real risk of severe currency devaluation if not inflation. So where do you keep your cash? For many, National Savings might be a good choice but a couple of month's spending in a biscuit tin is going to be a great comfort. Meanwhile, slash all spending ruthlessly and without pity and keep the austerity measures in place until you feel that things have bottomed and are getting better (we have a long way to go, we are nearly at the end of the beginning). Mid-term, we might be in an inflationary or deflationary environment - few professional economists claim to know and certainty is the domain of the ignorant. To understand what deflation means, have a look online at resources that discuss deflation in Japan - Google japan deflation thought remember that we would be starting in a worldwide depression. Caveat - this is uncharted territory, there could be any number of underwater hazards on the other hand, the water might be fairly clear and safe. Nobody knows.