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Casey Research Phyle Wrap for Sacramento – May ‘10

by Brett on May 12, 2010

Last night our Sacramento based Casey Research “Phyle” met to discuss the current investing landscape – which quite frankly appears to be littered with mostly landmines right now!

(A couple of months back, our group talked about the scary potential for retirement plan confiscation, how to wire money to Central America, and other offbeat personal investment topics you won’t see discussed on CNBC!)

For the first time I can remember, we all entered the meeting with a unanimous opinion on something: the world economy is completely screwed.

Nobody had a scenario they could think of, however outlandish, that might save the day.  So while your average investor may believe the financial media hype that the “worst is behind us”, we all believe the real pain is yet to come.

VIX volatility price chartAfter nodding off for the past year, the VIX has awoken.  Fear is back!

(Courtesy of StockCharts.com)

The reason?  The debt – especially of the sovereign variety.  A century of ever creeping government in the Anglo Saxon is coming to roost.  Government scope and spending was a runaway bull market through much of the 20th century – it now appears to be in the final stages of a classic “blow off top” that can only end poorly.

The Greek bailout is just kicking the can down the road.  A default, and getting on with life, would be the best option.  But since nobody wants to face the music, the market is going to turn up the dial and extract what it believes it is owed.

Our group is equally disgusted with both Democrats and Republicans, and doesn’t see any hope for the US situation either way.  This nation, like it or not, is due for a massive restructuring – the type that a only a very deep Depression will bring.

While there is always talk about fleeing the nation, many in our group feel more at home, and safer, in the good old U S of A if things really hit the fan.  Perhaps we are being homers here – but we still see an independent nature, a love for liberty that runs deep in this country.

While half of this country may indeed be subsisting on bread and circuses (as half of US citizens are net recipients from the US government, believe it or not) – we don’t think the majority of this nation has yet lost it’s will to work and achieve (a la Club Med over in Europe).

Nevertheless, it appears inevitable that the sovereign debt problems are likely to topple economies – first Greece, then the PIIGS, then likely the UK, Japan, and the US.  It’s going to get ugly.

Nobody is sure “when” this next – massively huge – shoe may drop.  Will is be weeks, months, or years?  None of us had a good guess.  It could be this summer – next year – or 2014 – for all we know.

It really depends how long the bond market holds up.  The bond vigilantes forced the issue with Greece – they’ll no doubt return.  But they’ve been eerily quiet in the US, suggesting other forces (dare I say deflationary in nature) may be at work.

So the way we see it, the million dollar question is still: Are we heading for inflation, or deflation?

Few of us have the stomach anymore for individual stock picks.  In fact, one of our members returned from the latest Casey Summit, and he noted fewer individual investment picks than years past.  (Perhaps this is the sign of a bottom, but it’s hard to believe – we’re only 10 years into a bear market, equities are historically quite expensive…not to mention all of the debt issues).

So the inflation guys are continuing to accumulate gold and other precious metals – both stocks, and especially the physical variety.  Even us deflation guys believe that physical gold is a safety hedge that belongs in every portfolio.

The mood, overall, was more awe than anything – awe at the scale of the economic disaster that looks as if it’s looming before us.  And equally amazing to us is the general cluelessness of your average person – even your above average person.  Most seem to genuinely believe the worst is behind us.

Well, we continue to hunker down and prepare for the storm ahead.  In 2008, some of us got caught offguard – I know I did, big time – so this time we are trying to use the “eye of the storm” to tie down as much as we can, and get ready.

We had been spacing our meeting a couple of months apart – while the market drifted higher day after day, and volatility hibernated, there was not too much to talk about.  I suspect we may need to pull in our next meeting for a more agile approach in the coming months!


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  • http://www.TendonitisExpert.com Joshua

    Hey there. I and my Kerri are in the Bay Area. I’d love to get on the email list for the Sacramento phyle, would love to make the trip for the next get together. (I believe you can see my email)

    Also just sent an email to Casey Research re: a SF phyle and about starting one up here.

    Talk to you soon.

    Joshua

  • Brett

    Hey Joshua, awesome, thanks! Adding you to our email list now.

    I believe there’s a Silicon Valley phyle but not SF yet – the Casey folks will know – the SV phyle usually meets down on the peninsula, and they’ve got the good fortune of having Bud Conrad in the neighborhood who drops by their meetings from time to time!

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  • Bill Miller

    How about putting me on your list for the next meeting. I live in Redding and get to Sac a couple of times a month.

    Thanks,

    Bill Miller

  • Jerrilyn

    In the Denver area we are meeting every third Wednesday at 6:00 p.m. We always find plenty to talk about. If you live around here, ask CR how to contact us and you will be invited.

  • Mac

    Interesting stuff. I especially like to hear about substantive things like “how to wire money to Central America.” Often there are global suggestions about getting your assets out of the country, but few “nuts and bolts” directions on the specifics of HOW to do it. I understand that discussing some of these issues can put you on the radar screen of some very unsavory characters, and the reticence about publicly delving into details is understandable.

    Anyway, I’m surprised there is no Casey Phyle in the entire Sonoma County where I live, but we are still a hotbed of aging hippies where individualistic and libertarian thought are not well received.

    Please add me to your email list, because you may be the closest phyle. thanks

  • David Olson

    Please add me to the Sacramento phyle. I’m intersted in meeting other people that I can actually talk to and exchange ideas and information with about the incredible and unprecidented sequence of events that are now starting to unfold.

    Thank you and I will look forward to attending the next Sacramento meeting.

    Dave Olson

  • David K. Howard

    I would like to be added to the list for Sacramento, as I live in Orangevale. I’m a gold stock trader, former broker, and owner of a Sierra County gold mine in permitting stage.

  • Nicole Reynolds

    Would like to get your email list. I belong to an Orange County phyle, but find your notes well organized, and, of course, reflecting my own opinions! I thought the links your provided were worthwhile too.

  • George Kucera

    Hello,
    I would love to be on the list for Sacramento. I am in the foothills not far from EDH.
    Thanks, George

  • http://proctorkozak@earthlink.net Bob Proctor

    Please put me on your mail list for the Sacramento phyle. Where do you meet? Thank you for you help on this.

    Bob

  • Brett

    You got it Bill, just sent an invite over to you!

  • Chuck Neir

    Hi,

    I am a member of the Casey Phyle in Bellevue, WA. We meet every two weeks with wide free-ranging discussions. Please add me to your list. Is there a way to access any of your previous meeting discussions? I, too, am interested in the Central American transfer info.

  • http://joshtck@hotmail.com Joshua

    Thanks Brett.

    Hey Bill Miller.

    My parents live just outside of Redding in Ono. I;m regularly up there.

    Maybe we should do a Redding Phyle! Do you know others that might be interested in the area?

    I’m actually more interested in making livable/sustainable living on property out in the ‘country’, as opposed to getting out of the country. I wonder if Reddingites are more along those lines?

    Click on my name above and contact me through my website if interested.

  • Scott

    Please count me in for the next Phyle in Sacramento. I want to contribute to group. Really enjoyed the Las Vegas Summit as it was like a family get together with everyone having each others back!

    Regards,

    Scott

  • Brett

    Hi all, thanks so much for each of your interest in our Sacramento Phyle group!

    I just sent everyone an email invite to join our list – it comes from Google Groups – keep an eye out. If you don’t receive it, you can also join through this link: http://groups.google.com/group/sacramentophyle/

    In terms of specifics on fun stuff such as wiring money – would highly recommend checking out Mark Nestmann and Simon Black from Sovereign Society – they get into good detail on this stuff: http://www.sovereignman.com/

    And for summaries of previous meetings, I try to send them out afterwards, and they are archived in the Google Group – so once you join, you should have access.

    Thanks again all, this is a fun thread! Great to see so many like-minded people in the neighborhood!

  • Paul

    I live in Marin and would be glad to make the drive to Sacramento
    to talk with some people who are clued in about what is happening
    to the world and the people who live in it.
    Please put me on the list for your next Sacramento meeting.
    Thanks
    Paul Calderaro

  • Ardie Oji

    Hi,

    I live in Yuba City and would like to attend your meetings. Please add me to your e-mail list. I have been a subscriber to Casey newsletters for many years.

    Ardie

  • http://ComplicitSimplicity.com Allan R. Wallace

    I’ve gone to my first Phyle, In SoCal. It seems the desire to move offshore is a bit larger here, several folks were already started on their moves.

    I would go too, but I hate bureaucracy; and it seems even larger elsewhere. That is unless you go seriously third world: where government inefficiency makes its own type of freedom.

  • Brett

    Yeah and that seems to be Doug’s play – go where the government is totally incompetent, so they can’t bother you. I also couldn’t imagine a place like Europe – yikes – what red tape! I suppose that’s what you should expect from a museum!

    I, personally, am not as worried about the US as Doug & Co – perhaps naiveté on my part – I just think we’ll see a lot less bureaucracy in the near future, as this country begins to rediscover its libertarian roots. That, and the State is broke!

  • Brett

    Nicole: Just added you to our email list (sorry for delay, I missed your comment at 1st!) – thanks!

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  • Paul K

    Hi Brett,

    I like your new blog. I live in Reno and would like to attend a gathering in Sac to talk with like minded people. Can you put me on the list. Thanks,

    Paul

  • Brett

    Hi Paul – awesome, thank you, and you bet – adding you to the list now, you’ll get a confirmation email from Google Groups in a min.

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  • Audrey

    I wish I lived in an area that I could go to a phyle group. The closest I get is to go to vancouver or toronto for Cambridge or PDAC conferences.. or the NOLA conference.. also excellent… but only once a year..

    Does anyone know if there is a Phyle group in the southern states?

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