Vote of no confidence

[jay]

Effective today, I have moved the bulk of my retirement savings (401k-equivalent) out of blue-chip US equity index funds into European and Asian index funds (like Barclay's EAFE index). I'm leaving some amounts in Treasuries and small-cap US index funds, as a buffer and for balance.

This isn't just putting my money where my mouth is -- I believe that the US dollar will continue to weaken against other currencies, given the policies of the current administration. And if other countries grow tired of financing our deficits, the dollar will drop even further, possibly leading to a fiscal crisis over the next few years. All the foreign markets have to do is not sink far, and I'll still profit from them (in dollar terms).

Not that my paltry $200K will make any difference, but it is effectively a vote of no confidence in the Bush administration's economic and fiscal management...

Comments

[cjsmith.livejournal.com]

*big nod*

I'd go Asian, m'self. European age balance might mean they'll implode before we do.

O'course, unsolicited investment advice from someone who has zero financial or economic training is worth, probably, less than you paid for it. :-)

[brian1789.livejournal.com]

I'd probably lean heavier on Asian markets, if I could, figuring that at some point all of those economies struggling to maintain artificially-low pegs against the US dollar will lose that tug-of-war and float, at which point the dollar value of those shares will soar, relatively. But I wouldn't be surprised to see a $1.50 euro by the end of 2005, either. Unless the Fed rapidly raises interest rates, in which case I'll still do okay in Treasuries.

I'm constrained by being ironically in the federal employee's retirement system, which only gives us a limited number of choices. We're lucky IMO to have a non-US investment option at all, considering who manages those funds...