You're one of richest 1%, where do you park your money now? ....

[Blackhatjack]

The economy is facing huge trade deficits and nation debt, rising inflation, demand for products and production is tanking, huge overall personal debt for the majority of consuming public, the housing bubble is bursting driving down sales and prices, and the stock market is poised to head downward... so there you are sitting on a mountain of cash, getting tax cuts and no threat of estate taxes down the road, no tax incentives to give to charities, you already bought your new luxury car, new yacht, etc.

Do you sit on the cash invested in short term CDs to stay liquid? Gold? Or do you invest somewhere?
And what happens to the US economy if you and all your fellow "richest 1%ers" stay liquid and do not invest?

The other 99% of us would like to know.

[babylonsister]

1. Cayman Islands?

:shrug:

[cali]

3. or

the Channel Islands

[Finder]

2. Real Estate. n/t

[napi21]

5. I think it's too late for R/E. Maybe in a few months when prices are

under market. The boom is done!

[I_Make_Mistakes]

7. Real estate is overpriced right now, you will wait till it bottoms, it

is falling but not bottoming yet. I would actually put it in that consortium of business leaders fund for development of new energy sources, Hillary talked about them, but not the group's name or who was involved.

[Drum]

11. Buy one mile inland, and you'll be sitting pretty,

at the rate the Earth is heating up. It'll be prime beachfront down the line, probably.
:shrug:

[Hekate]

54. You'd have to calculate height above sea level, not distance per se

I live 3 miles from the ocean, and have been trying to find out approximately how high above sea level my town and tract home are. Hubby finally was able to place it at 20 feet. If the Greenland Ice Sheet melts the ocean is supposed to rise that much -- I think salt water would be lapping at my doorstep and undermining the cement slab. Hard to get answers for this kind of thing, though.

Anyhow, if I had the bucks I'd buy real estate in several locations and try to get off the grid.

Hekate

[me b zola]

31. That's what they will be buying lots of when the crash occurs

In the meanwhile, I'd be willing to bet that their money is being kept in anything but dollars.

[napi21]

4. I read that Gates etx. pulled a lot of their $$ out of the USD and

invested in the Euro. That was about 2-3 months ago. I don't know what they're doing now.

[acmavm]

6. I heard that Buffet did the same. But since he's giving away so much of

his fortune, who knows. I guess though that since he's leaving himself enough to live on :sarcasm: he might have left in in Euros.

Isn't that also supposed to be where they put a lot of Berkshire Hathaway money as well?

[Blackhatjack]

9. hmmmm ... doesn't that affect the US value of Microsoft stock?

That is precisely what I am wondering about. If you are super rich, do you pull your money out of US investments, wait till the price of US assets crashes, then swoop in and buy them up for pennies on the dollar? Or do you maintain investments in US to try and preserve the value of US held assets?

I just wonder if scenario #1 is not the thinking going on right now by the richest 1%.

[napi21]

19. I'm sure never going to be rich, so I can't guess what their thinking is,

but I was very worried about the little I have in a 401K fund from a rollover. I called the broker and asked about investing it mostly in euros mainly because I keep hearing that Iran and Venesuela were going to change the funds used to pay them for their oil. It is now payable in USD's and they were going to change that to euros. What little I know about economics tells me that would make the value of the USD plunge!

I suspect that was the thought process of Microsoft, Berkshire Hathaway etc. They know a whole lot more about this stuff than I do.

[papau]

8. Cheney went to Euro's a few years back n/t

n/t

[TheFarseer]

38. very patriotic

what a piece of sh*t. Doesn't he believe in the job he's doing with the economy? Wouldn't that be alot like Derek Jeter betting against the Yankees? Shouldn't that be illegal?

[Wiley50]

10. My Pay Pal account is ready to recieve n/t

[bleever]

17. Your noble service to others has my deepest respect.

:7

[Psephos]

12. What wealthy people do with $$$ usually benefits others as well

Parking cash in CDs or money market funds or just keeping it in a checking or savings account makes the money available to others who wish to borrow.

When wealthy people "stay liquid" in cash-equivalent funds or accounts, such as CDs or money markets, etc., that provides capital for others who wish to invest in businesses or homes or whatever. When you get a loan the money comes from those who have put cash into accounts. The list of those who use such sources includes cities, states, and the federal government, who borrow by issuing bonds, which wealthy people buy. No one with wealth keeps their money as cash stuffed into laundry bags except drug dealers.

If wealthy people buy yachts or airplanes or whatever, then that creates jobs for those who make those goods. The disastrous special tax on luxury goods about 15 years ago put many companies out of business who made such goods.

I am not wealthy in the least, but even I know that a poor man never gave anyone a job.

Just sayin'...

Peace.

[DireStrike]

16. If nobody ran the plantations, the slaves wouldnt have had anything to eat

Of course the money all goes somewhere, but the rich benefit from it without lifting a finger. It's not like they're doing a service - it's the other way around.

[ComerPerro]

25. Their money would help people if we taxed the shit out of them, too

if we asked them to actually contribute a fair share and stop leeching off the actual work of most of society, we could fully fund education and health care WHILE paying for their bullshit war.

[Blackhatjack]

27. You are assuming the slaves could not grow crops on their own...

...which they proved they were more than capable of doing after the Civil War. Sharecropping became respectable, and many ended up owning the land. The old "slaves would have been lost without the plantation owners" idea holds no water.

[DireStrike]

42. No, I was just being thoroughly sarcastic

Was that really an idea that they spread around? Wonders will never cease. It certainly goes in the same column as phrenology.

[Blackhatjack]

20. Please correct me if I am wrong, but ....

... when the wealthy keep their funds liquid in short term CDs, checking or mms, the banking/investment firm cannot commit those funds for investments longer than 3 days/or the length of the CD since the investor can demand their money almost immediately. Therefore, these kinds of investments do not provide "capital for others who want to invest in businesses or homes or whatever." So I fail to see how that substantially benefits others.

I understand that financial advisors/stockbrokers and others are advising some of these wealthy clients to "get liquid and keep their cash no the sidelines." Isn't this exactly the scenario I identified above -- and I am wondering what the effect will be on the overall economy if enough 1%ers follow that advice.

[ComerPerro]

24. Except for when they tank the economy after investing in foreign currency

You seem to be spouting a lot of Republican talking points.

[Psephos]

46. And you are spouting an ad hominem attack

I'm here for discussion. Let's leave the personal stuff out of it. You have a different opinion, cool. Try expressing it persuasively.

Peace.

[U4ikLefty]

50. There is no attack in their response. They are just pointing out

that you seem to be parroting Rethug talking points. If you call that an attack then you'd better grow thicker skin.

[Psephos]

57. Umm, yeah

Do you personally consider it an insult if someone says to you, "you seem to be spouting a lot of Republican talking points"?

Honest answer, please.

Dress it up however you wish, but a post like that is all insult and no argument, which makes it unsuited to DU.

Peace.


There is only one way to strive for decency, reason, responsibility, sincerity, civility, and tolerance, and that is decently, reasonably, sincerely, civilly, and tolerantly.
- Vaclav Havel

[ComerPerro]

51. Attack? What attack? My point is,

you seem to have a viewpoint that is in line with typical Republican line of thought.

[pitohui]

32. i gave plenty of people jobs when i was poor

even when i was poor, i had to have a mechanic work on my car and a refrigerator guy come fix my refrigerator

my doctor was actually paid more, because since i didn't have insurance -- i paid $35 for an office visit, now i pay a 25 co-pay and the insurance co. pays him another $4.39 (actual notice from the insurance company from my last ob/gyn visit)

i bought shoes, grocery, clothes -- and from stores that rich people wouldn't patronize, thus giving a chance to people who might not otherwise be able to work -- esp. for my clothes and furniture, purchased at goodwill and salvation army

the man who thinks a poor person never gave anybody a job is extremely unobservant about reality, is all i will say about that

if you had ever been poor or actually known any poor people, you would quickly see that there is a huge economy that wouldn't exist w/out the poor

rich people are not providing honest employment to the junk dealers, pawnbrokers, or used car sellers of the world either

i sure as hell never saw a rich man buying small tools and garden supplies at the tiny corner feed store either

you are very ill-informed, educate yourself

[Blackhatjack]

36. You could not be more right, and the dirty hidden secret is ....

...most of the checkcashing services, subprime lenders who charge sky-high interest rates, are owned by the major banks and lenders who give free checking to the wealthy, and loan them money at prime.

The poor pay more for just about everything, but they contribute to the economy in ways that the wealthy may never contribute a nickel to.

[DireStrike]

44. Don't forget the 'ghetto tax'

http://www.nytimes.com/2006/07/19/us/19poor.html?ex=1310961600&en=67ee8891360eb90c&ei=5088

[Psephos]

64. I expect better from you

because of the wealth of good posts I've seen from you in the past.

"if you had ever been poor or actually known any poor people, you would quickly see that there is a huge economy that wouldn't exist w/out the poor"

You know my financial history? Well, no you don't, or you would not have said that. I have overcome a lot.

Furthermore, you're using a loose interpretation of my words to twist meanings from them that was never there. That's often done by those who want to impose their opinion on others. I would prefer you simply offer your opinions, as I offered mine, free of scorn and condescension. If you raise the hair on the back of my neck then you lose all ability to persuade me.

That happens too often around here to those who dare have opinions different from the herd.

I, too, have given "poor men a job" through participation in the economy, similar to you and others. However, when I was talking about giving someone a job, I meant a job with a paycheck every Friday. You know I meant that, too. That requires capital.

"you are very ill-informed, educate yourself"

Does a Master's in Economics from U of M/Ann Arbor count as educating myself, Pitohui? Or must I also hold opinions identical to yours before I can count myself educated?

Peace.

[Greyhound]

58. Not a flame, but this is an economic fallacy. You have fallen into,

what I call the "George Bailey" misconception of how our economy works. When a bank makes a loan this is new money that is created for the purpose of the loan, IOW if you borrow $100,000 to build a new house, the $100K is created (it should also be noted that the interest charged is NOT created and is the foundational flaw of same economy, but that's another thread), and injected into the economy to buy the materials and pay for the construction of the house.

$$ parked in checking, savings, CD's,etc. is used by the banks for its own investments, and a small percentage of those profits goes to pay you your pathetic interest on the account (a good rule of thumb is that the bank makes @ least 300% more that they pay you).

[Psephos]

60. Thanks, yours is the kind of post I'm here for

It takes different points of view to have a discussion, otherwise it's just an amen chorus.

You've left me with good food for thought. :)

Peace.

[LSK]

63. wow, that is right out of the supply side economics playbook

Well done!

Can you tell me what companies were put out of business by the luxury tax?

Lots of poor people create jobs because they spend almost all of their income on goods and services just to make a living. Money spent on goods and services means people have to manufacture those goods and services. Creating demand creates additional business.

[elehhhhna]

13. Cheney's betting on the US dollar dropping. But that's just his

reported investments...not offshore holdings.

[enid602]

21. Cheney

He's invested heavily in non-dollar bond and equity funds. I have as well, but did it long before I knew that Cheney had. You can buy shares of these funds here in the US, and although rare, I found them through Vanguard, and have been able to diversify my holdings internationally without taking money out of my IRA (and be stuck for penalties and taxes).

[OPERATIONMINDCRIME]

14. First, I Build A Beautiful House Exactly The Way I Want It.

True home theater, big ass hdtv, game room and indoor pool mandatory. Probably would then invest some in other real estate and I'd also use some to build a psych hospital to my specifications (I find most psych hospitals to be worse than a prison). Would obviously save a ton of it in the bank for my children's future, education, help for buying a nice home etc. I'd use some to play with penny stocks buyin and sellin daily as I always wanted to play that game but prior to being in the 1% it would be too risky for me. If I had the money to spare, then I could have some fun. :)

I'd definitely donate to each congressional democratic candidate that needed it and would also donate plenty to different charitable causes. I'd sponsor more third world children (right now I have two, but I'd like a hundred) and would also start an assistance fund for pregnant mothers who need some funds in order to raise a baby as opposed to aborting it (though I'm not sure how I'd judge legitimacy). If I was reallllllllllly wealthy, I'd then also spend a chunk of cash to be able to go into space (a personal dream). I'd also use some to finally fully fund a few of my inventions so that they could be propelled to market.

Guess that's a start for now.

[mainer]

15. municipal bonds

Only AAA rated. You avoid state taxes, they're yielding around 4-5%, and they're very safe.

Everything else looks a little shaky to me.

[ThoughtCriminal]

18. Human Suffering and Fear

A big growth market in recent years. Cruise missiles, private security, etc.

[Dover]

56. Yes that was the advice a broker gave me 7 yrs. ago.

He said, Defense, Energy and Security. How did he know?

I was in a different frame of mind at the time (pre-Bushco) but gave him a little to invest to see how he/it did. The broker put it in Ford Motors and Enron. Nuff said.

[whalerider55]

22. I'd buy me another congressman or two..

then a senator, a vice president. can't never have tgoo many of them. a few governors help.

and foreign investments... i'd buy me a couple of european PM's, a sheik or two. I'd buy myself a country in Africa, one I could hunt in; I'd also invest in land in antarctica- i bet the surfin' will be bitchin' there in a hundred years.

eat the rich.

whalerider55

[Raine]

23. Real Estate

in the lower economic areas cause those are the ones that will be going up, the weathy areas have bottomed out.

[GraysonDave]

26. How about commodities?

Grain, sugar, OJ, pork bellies, oil...

It seems to me that there is still a lot of inflationary pressure out there. The fed has stopped fighting it for now. The US will have to start printing money before too much longer to service its massive debt and make good on the social security promises.

I think we're destined for a spell of high inflation, I'm just not sure about the timing.

[Blackhatjack]

28. If you own stock in public company or hold a position with public company

...then you ought to have to file an information tax return with the IRS identifying all cash, stocks and investments held in accounts outside the United States. Same goes for the public company and its holdings.

People would be amazed at the wealth that has left this country UNTAXED, and has exacerbated the problem created by the huge foreign trade deficits we have with China and others.

[Sinti]

29. Silver, gems, land , commodities and the new privatized water

Not necessarily in the above order. Gold is way over priced, and platinum has topped off IMO (Buffett agrees with me). Most of it would be foreign investment - American real estate, per se, is a lead balloon with a Wiley Coyote complex (hasn't learned about gravity yet), but they ain't making any more land. That water privatization thing they're doing in foreign countries going to be a gold mine, they're thinking about bringing it home.

[mcscajun]

30. Let's Pretend I'm a One-Percenter.

I put all my money into Precious metals, Real Estate and Foreign Stock Markets; where else?
I effectively abandon the US economy and, eventually, the US, while retaining ownership of several choice pieces of it, just in case it stages a comeback. Gotta hedge my bets, ya' know.

[leftofthedial]

33. offshore banks

buy slaves and breed them.

they create more slaves.

[question everything]

34. Finance columnists say money market fund and CDs

As a matter of fact, since the Fed is now resting from raising interest rate, the recent recommendation is to lock long-term CD.

But first, pay off your debt. Yes, even your mortgage and equity line of credit.

[TheFarseer]

35. Oil, certain stocks, T-bills, foreign stocks

foreign real estate. I'm just guessing here.

CD's is all I can figure out to invest in personally

[bottomofthehill]

37. Lots and Lots of I-Bonds

Not Cash. I-Bonds, that way when inflation goes thru the roof, you dont loose too much of your purchase power

[mnhtnbb]

39. Not part of the 1%, but my only account that is still fully invested

is my IRA. I'm 55. I sold all individual equities last May when the market started to dive. Holding cash and 3 month CD's. Kept my mutual funds.
The funds I'm in have a pretty good track record of holding value in downturns. My IRA is set up for dividends to be reinvested, so at least when the market is down I'm adding to holdings at lower prices.

My husband is completely out of the market. He has a lot of TIPS.

[hootinholler]

40. Diamonds

Precious metals, not just gold. Remember diversify. Real estate to be leased has both a short term income and an appreciation income.

-Hoot

[RB TexLa]

41. no one of any economic standing has any obligation to invest to

help the US economy.

[Blackhatjack]

59. So the US environment that made it possible to get and keep wealth

should not be a consideration of anyone of any economic standing?

I find the idea that every 1%er should chase the highest return on their dollar to any other foreign country very selfish, and very short-sighted since most have US assets and undermining the US economy to seek a higher return may devalue their US assets and cost them money in the long run.

Whether they like it or not, the richest 1% are still part of this country, and their loyalties and patriotism should not be significantly different just because they are multimillionaires.

[RB TexLa]

61. We are all part of the world

Do you wear an "America Love It Or Leave It" t-shirt?

[calimary]

43. If I had that kind of money, I'd start buying up EVERY broadcast

property I could. Radio AND TV. EVERY SINGLE ONE. Every group, every small collective of stations. Stations big and small. Local and regional in signal strength. EVERY possible availability. I'd grab it. And then I'd program Air America and a few other progressive hosts, and create a progressive network behemoth to rival ClearChannel. That would, in some cases, involve buying up a station that presently carries limbaugh or that-guy-whose-name-rhymes-with-Vanity, or o'lielly, or any of those other weasels. And then I'd take them off the air. I'd also try to buy up controlling interest in Newscorp, with an eye toward a hostile takeover.

I also had this dream of strolling into a staff meeting that had been called, at the Pox "news" network, to introduce its new owner. The first thing I'd do, after being sure of my legal ground - in view of all those fat contracts some of the "talent" on there enjoys - is arrange, systematically, to take the worst offenders off the air. Perhaps even sign them to extended "contracts" that forbid their abrogating the deal to go to another network or setting up shop elsewhere, and then keep them marooned like that - with no face time, no airtime, no shows, no hosting, no nothing - maybe for at least a year or more. Until some in the public forget about 'em, or others try to fill the void (of which there is less anyway, since I will have bought up so many broadcast properties and packed 'em with LIBERALS). They really shouldn't complain. They'd be getting paid, and they'd be held to no-cut, no-compete contracts. Meanwhile, Pox "news" programming would suddenly start to - um - shift. I'd also get rid of Alan Colmes. No useless invertebrate "liberal" pretenders allowed. I'd have somebody feisty on there, like maybe Randy Rhoades, and bring some milquetoast "token" CONservative on, just to throw 'em a bone. BTW - controlling interest of Newscorp also, I believe, would give me clout with such venomous publishing outfits as Reganbooks and more, which would suddenly start publishing LIBERAL authors, curiously enough...

Anyway, yeah, an impossible dream, it would seem. But if I had that kind of money, that's exactly what I'd do with it.

:evilgrin:

[Selatius]

45. Park my money in DEFENSE stocks and OIL and GOLD

Defense is having a good year this year. War...it's what's for dinner. If I was in the top 1%, I probably would've been involved in oil a long time ago...like before prices spiked skyward.

Gold is always a good safe-harbor investment in an uncertain economy that could implode depending on war with Iran. My oil stocks, however, will explode in value though.

[rainbow4321]

47. "Senate report blasts Dallas firm for offshore services for the masses"

http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-offshore_13bus.ART0.State.Edition1.1f2f04a.html


For $2,500, a Dallas-based financial services company offers customers the privileges of offshore transactions that were once reserved for the super rich. A corporation in Belize, a trust in the Bahamas and two offshore accounts, with either banks or brokerages, are all included in Equity Development Group's Complete Offshore Package No. 1.

"The average person assumes that domestic options are their only options," company founder Samuel Congdon says elsewhere on the site.

Such efforts to bring the offshore world to the masses, or at least to lesser millionaires, have earned Equity Development a place in a scathing U.S. Senate report on offshore tax havens. The report said the offshore industry fuels widespread tax avoidance worth up to $70 billion to the U.S. Treasury.

"Over the last six years, EDG utilized the Internet to provide about 900 mainly American clients, many of relatively modest wealth, with the type of offshore services previously available primarily to high-net-worth individuals," according to the Senate report, Tax Haven Abuses: The Enablers, the Tools and Secrecy.

[Greyhound]

48. Richest 1% does a lot of most of what has already been mentioned,

There has been a significant increase in foreign real estate investment, with what looks like a strong upward trend for the near future. Land in emerging markets is still cheap especially after the windfall profits made in US real estate recently.

Look for lots of currently liquid money to come back to the US after the correction.

Crystal-ball out.

[TroubleMan]

49. Oil futures and Euros

nt.

[Alcibiades]

52. Oil stocks, Chinese manufacturers

and defense, especially Halliburton with their profitable no-bid deals.

[Dover]

53. Swoop in like a vulture when the economy bottoms out, and buy

up failed businesses, cheap land/real estate (including park land which the gov. can no longer afford to keep), natural resources (particularly water and energy), and gold or a safe foreign currency. Or another approach that one local wealthy man once explained to me....you dig a hole and sell off the contents, then charge someone else to fill it up with their stuff. You destroy a country and then hire your own to rebuild it. You create a crisis out of thin air and contract your own people to address the 'problem'.
Of course the really wealthy ones are also manipulating stocks and will continue to play the game for as long as they can. It's easy when you make the rules and don't suffer any significant consequences.

But they need to remain mainly liquid for now. I'm sure it's temporary. The banks hate that. They don't like big savings accounts.

[Fleshdancer]

55. biotechnology and/or China

That's just my guess though. I'm no where near the top 1% so I really have no idea.

[Atman]

62. Step up to plate and TRICKLE DOWN, you fuckers!

I promise! Give me a couple of thousand bucks and I'll pump it back into the economy faster than you can say "IMPEACH BUSH!"

[threadkillaz]

65. SIRI - Sirius Radio

Nice double bottom near 52-week low.

http://finance.yahoo.com/q/bc?s=SIRI

One of only two companies in a big future market.

Can't beat the delivery system. Many automakers installing.

FCC Setback for XM, their only competitor today too.


Go SIRI!