Stoyan Bojinov: Financial markets appear to be at a major crossroad; improving economic data on the homefront points to recovery, however, unresolved “fiscal cliff” woes can just as easily drag the United States back into recession. To top it off, sluggish growth in China coupled with Europe’s debt burden make for an unpredictable landscape riddled with clouds of uncertainty, leading many to believe that another economic downturn is inevitable. Some more superstitious investors have even gone as far as preparing for total collapse.
Since the Y2K scare (hoax) in 1999, grim prophesiers have pointed to December 21, 2012, as the date of the apocalypse according to the Mayan calendar. Although many experts have poked holes in this latest “end-of-world” prophecy, just in case the Mayans were right, we outline three investment ideas that should appreciate wildly if civilization crumbles:
Few investments can withstand the test of time, which is why gold bullion holds a very special place in every doomsayers’ portfolio. What better way to defend your capital from the end of the world than with a hard asset that has been around forever? Since the U.S. abandoned the gold standard in 1971, this yellow metal has seen a meteoric rise in value, which is expected to continue as central banks around the globe stick to “loose money” policies. Gold bullion is perhaps the ultimate “safe haven” commodity play for those looking to steer clear of futures contracts, exchange-traded funds and gold mining stocks.
It’s hard to imagine an apocalyptic scenario where real estate doesn’t see an astronomical appreciation in value. Farmland in particular should garner even more interest as survivors will be left scrambling for shelter and a means to produce food. The appeal behind this hard asset is very straightforward as it has outpaced the rate of inflation over the last few decades. Furthermore, with rising populations at home and abroad, it’s safe to say that farmland will continue to be extremely valuable, especially if global food supplies take a hit from any sort of natural disaster.
3. Classic Cars
Although classic cars are regarded as a luxury good, these assets can prove to be quite useful should we find ourselves scrambling for means of escape or simply need to get from point A to point B. Classic cars deserve a place in an “end-of-the-world” portfolio because this asset class has demonstrated the ability to deliver impressive, uncorrelated returns, especially when financial markets tank, which would likely happen should the Mayan prediction manifest. That 1966 Shelby Cobra sitting in your garage is not only a “pretty” store of value, it may prove to be your only means of transit when civilized order breaks down.
Related Tickers: SPDR Gold Trust (NYSEARCA:GLD), iShares Silver Trust (NYSEARCA:SLV), iShares Gold Trust (NYSEARCA:IAU), The Mosaic Company (NYSE:MOS), Potash Corp. (NYSE:POT).
Written By Stoyan Bojinov From CommodityHQ Disclosure: No Positions.
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