Tuesday, July 26, 2011

3 Ways to Trade the U.S. Default Talks No Matter What Happens

Follow My Alpha

The end is near! Or at least that’s what the media keeps telling use every day. It seems that a U.S. debt apocalypse is all but certain. Before you conjure up images of cataclysmic fire and brimstone raining down, let’s remember that nothing is accomplished with stress. In our view, the prudent path is to objectively look at the default situation and see how to make money - no matter what happens.

We doubt the U.S. government will actually default on its debt, but credit rating agencies might downgrade the U.S. regardless. Why would they do this? First, because they can - and it’s that simple. Second, the reality is that the U.S. hasn’t put on its best face in dealing with the situation and isn’t instilling much confidence among the rating agencies. After all, going to the media to point fingers and try to gain favor with voters isn’t helping to resolve the situation. It just makes U.S. look childish.

For investors, what matters is controlling what you can control and knowing the options relative to this situation. In our view, there are three simple strategies regardless of. . . . . . . .

1 comment:

  1. Everything is wonderful, baby-boomers, invest in everything American. Everything will turn out just fine. Don't worry, be happy.


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