The Aftershock Investor: A Crash Course in Staying Afloat in a Sinking Economy

CHAPTER 11

Your Aftershock Investment Portfolio

As we said before, The Aftershock Investor is the guide to investing even if there is no Aftershock. Even if the bond market doesn’t melt down, there are still big long-term problems to contend with. Even if the stock market doesn’t melt down, there are still big long-term problems to contend with there, as well. The same is true for real estate. It won’t take require a big multbubble pop for these assets to fall in the future. So you needn’t buy into our entire point of view to take heed of our warnings.

As we often say, you certainly don’t need hyperinflation to cause major problems for stock, bond, and real estate markets. Even interest rates that were not atypical in the booming 1960s and absolutely benign compared to the incredibly high rates of the 1970s and early 1980s will cause real problems for all these markets at their very high prices today. You need to be prepared for them interest rates to rise.

At the very least, you need to be prepared for lots of volatility. We think there will be an Aftershock at the end of this volatility, but even if there is not, you need to at least be prepared for the volatility in the near future and the likelihood of diminished returns from traditional investments.

So, to do that, let’s summarize what we’ve discussed in this book about a diversified Aftershock portfolio. In particular, what is the overall portfolio strategy, what are its components, and what’s is the best way to implement ...