Monday , 17 June 2024

Take Advantage of Current Excessive Liquidity With a Tactical Approach to Investing – Here's How

The growth in liquidity in global systems has become staggering…[reaching] a whopping $15 trillion – and rising – from the world’s eight largest central banks [alone as shown in the chart below.]…[That’s equal to almost] one-third of world equity values…which means that central banks are creating another bubble…No wonder the stock market is rising. [With so] much liquidity,…and with interest rates so low, there is no place to go but “risk on” assets. [That being said,] investors need to know how to capitalize on this short term phenomenon and how to prepare for the inevitable burst. [Let me explain further.] Words: 489

So says Keith Springer ( in edited excerpts from his original article* which Lorimer Wilson, editor of (Your Key to Making Money!), has edited further below for length and clarity – see Editor’s Note at the bottom of the page. (This paragraph must be included in any article re-posting to avoid copyright infringement.)

Springer goes on to say, in part:

Once again, rather than fix the problem so we can get on with a true recovery and adjust to slower growth from a rapidly aging population and a massively over-indebted population, the Fed are making the same mistakes of the past: creating more money through debt just like they did in 1998 stock market bubble and 2003 real estate bubble.

Investor Strategies

The good thing about bubbles, though, is that it drives asset prices higher. Investors that know how to participate in the current bubble with the least risk possible and know when to get out, will do well. There are definitely good opportunities out there for nimble investors who know what they’re doing, so be the expert or hire one.

1. Buy Precious Metals

Naturally we cannot just sit with money in the bank earning nothing, nor can we afford to stay dormant with an old fashioned buy-and-hold approach. Both are destined for disaster. If this “raining of money” does nothing else, it will debase the leading currencies and push commodities higher. Use this correction in gold and silver to buy [more – or, at least, – some]…

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2. Enter Stock Market Now

[While] all this excess liquidity, and the possibility of a QE3, is a positive for stocks, we are entering correction season…Although many people are waiting for a pullback to get invested, it is certainly very possible that it just won’t come until the market is much higher. Of course, we continue to recommend to simply, Invest for Need, Not for Greed, which is the art of getting the very best returns necessary, with the least risk possible.

3. Take a Tactical vs. Buy-and-Hold Approach

Investors must continue to avoid buy-and-hold (buy-and-hope) and enter investing in a “Tactical” approach. Once we get through this little corrective period and get into the next earnings releases, we’ll probably see new highs. Growth investors can buy…. [well researched stocks and ETFs while] moderate investors can focus on preferreds on corporate bonds, where yields are the best.


Editor’s Note: The above article has been has edited ([ ]), abridged, and reformatted (including the title, some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. The article’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article.

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