Gyroscopic Investing

In your second moment of clairvoyance, you become certain that:
1. The past 100 years of US and world economic behavior was a historical aberration.
2. Over the next 30 years, things will drastically change (due to such things as world population outstripping resources, the end of the "Pax Americana," the reversion to a more waring and unstable world, and/or the end of the dollar as a reserve currency, etc).
3. Again, you have complete certainty of a drastically different future but you do not know the specific economic outcome.

How would you change you investment strategy going forward (if at all)?

If I suspected that my financial life would be endangered, I would concentrate on making my non-financial life more resilient by moving to a green, mountainous U.S. state like Colorado or Wyoming or Idaho and setting up a nice self-sufficient homestead not too far from a reasonably-sized city like Colorado Springs or Cheyenne or Boise. Basically, a place where rule of law is likely to persist, where lots of fertile land is easy to come by, and where people generally already have a rugged and resilient attitude. Probably the last place I'd like to be in your scenario would be a large urban area that's totally dependent on imported resources and specialized employment.

WTF is a Pax Americana?  We've almost been at war for our entire existence.

PS,

I would strongly encourage additional research into potential geographic locations for a homestead in a SHTF type future.  I've lived in Colorado, Kansas, and Indiana.  I also grew up on a small farm.  I can tell you that I wouldn't recommend anywhere further west of Missouri or extreme eastern Kansas (which is the same thing essentially) for a homestead unless you're comfortable being dependent on irrigation (the unsustainable kind, as it's from an aquifer that's running out) to grow many crops.  Colorado is particularly dry, and I wouldn't attempt any kind of large scale farming without irrigation.  There's a reason most of the fields are circular in eastern Colorado.  You could combat this with crop selection, but you'll still be making life harder for yourself.  A smaller but more productive farm is easier to secure and maintain without mechanization.

The western states are sparsely populated for a reason.  Even now, many of the states west of Missouri are still in a nasty drought, which has largely passed further east.

My personal plan is the same whether we have prosperity or ruin.  I'd like to get a small farm as far away from urban centers as possible while not leaving a particular region that is characterized by fertile soil and abundant rainfall.  This would include moving no further north than central Indiana, where I currently reside, no further east than Missouri, and an as yet to be determined southern and eastern border.  Southern Indiana is a very likely candidate.  Being capable of growing your own food is the fundamental keystone to a secure lifestyle in any situation.

Probably more gold, farm stocks and utility stocks.
Sounds like an awful planet, by the way. I'd probably try to convince my wife and parents to move to New Zealand.

Kriegsspiel wrote: WTF is a Pax Americana?  We've almost been at war for our entire existence.

I am not a historian by any stretch. But it is my understanding that, even though the US has been involved in a war during much of the past 100 years (often with single countries or regions), the world has been at relative peace by historical standards. Correct me if I am wrong.

Interesting that most of the strategies involve moving to arable land. Assuming that, having bought such land and there is cash left over, would you still invest in a 4x25 portfolio?

BearBones wrote:

Kriegsspiel wrote: WTF is a Pax Americana?  We've almost been at war for our entire existence.

I am not a historian by any stretch. But it is my understanding that, even though the US has been involved in a war during much of the past 100 years (often with single countries or regions), the world has been at relative peace by historical standards. Correct me if I am wrong.

No, you're basically right. According to wiki:

Pax Americana ... is a term applied to the historical concept of relative peace in the Western Hemisphere and later the Western world resulting from the preponderance of power enjoyed by the United States beginning around the start of the 20th century. Although the term finds its primary utility in the later half of the 20th century, it has been used in various places and eras, such as the post-Civil War era in North America[4] and globally during the time between the World Wars.[2]

http://en.wikipedia.org/wiki/Pax_Americana

I guess it's all relative. :-)

Ok yea.. I was coming at it from a different angle.

RuralEngineer, I wasn't thinking of a Montana homestead as desirable in case of true SHTF, but rather a "lite" version of that for BearBones' scenario of lean, hard times, without mass collapse. Even if you grow 100% of your own food, you can never be truly self-sufficient without some trade with others unless you're willing to do without a very large assortment of goods, including those made of metal and plastic.

Unless, I suppose, you learn blacksmithing, celluloid manufacture, and 3D printing.

The closest the U.S. has come to economic doom was in the 1930s, and farm-related investments would not have been a good move during that period, even if you knew in the 1920s that an economic disaster was on its way.

I would probably just stick with the PP, since economic disasters can be inflationary or deflationary, and periods of disaster can still have pockets of prosperity (i.e., secular bear markets for stocks can contain very strong cyclical bull markets for stocks).