Monday, 1 October 2012


''Borrow long, Lend short''

There is an old bankers maxim ''borrow long and lend short''.  Meaning
to borrow money for as long a term as possible and lend your money
for as short a time as possible. This is easily seen in most mortgage rates
in that the longer the mortgage the higher the interest rate... It is also
 seen in the bond yield curve which is currently distorted but
 I will not get into here. Historically this theory has proven wise
... and now more than ever in my opinion.

BREAKING RULES

I was asked by a friend to devise a portfolio to make
a lot of money with risk.... here is what I came up
with :

Up until now I believed in being debt free. Now I
break two fundamental rules.
1) borrow money (3% fixed for 5 years)
2) Do not be diversified Physical precious metals***

The borrowed money goes into physical gold and silver
as I believe it will appreciate dramatically over the
next few years and certainly more than 3 percent.

My thinking is that every major government (including
China) is printing massive amounts of currency in a race
to the bottom. this is to keep their currency rates low
especially against the USD so that exports are competitive

buy physical gold (Canadian maple leaf coins) and
physical silver and store in Canadian chartered bank
safety deposit boxes
I also suggest these publicly traded vehicles
 Silver Wheaton (SLW) a silver streaming company
Central Fund of Canada (CEF) half the $ in physical Gold half in Silver
Sprott Physical Silver (PSLV) Physical silver stored in the Canadian mint

 Government can print all fiat currency they
want but they cannot print gold and silver which, btw, has been considered
money for over 5000 years... who am I to argue with history?

*** I would suggest buying farmland but who is going to look after it?




1 comment:

  1. I've always thought a small satchel of gold coins would be more fun to carry than a wallet! The downside? Glenn Beck was right about gold. Ugh.

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