Example of Real Estate crash, which the worse than you can imagine
http://www.generationaldynamics.com/cgi-bi...?xct=gd.e070220

Gold Price clearly crash after 80's recession
http://goldprice.org/30-year-gold-price-history.html

You can invest in REIT that gives about 10% dividend annually, and liquidate whenever you feel to do so.

There is no infinite rise or fall, the concept is simple. When you see infinite fall prepare to buy as much as you can, and sell to those who sees infinite rise in the future.

Since you have about 16 years horizon, keep the money in FD
and then....
when the next crash comes you will have the bullet to dump your money in stocks
Why gamble with property which is hard to liquidate and expenisve?
Keep 100% in cash and when crisis hits, you just need to use 25% of your money if you are conservative
keep remaining 75% as cash, invest 25%, and get 3 to 5x return from your 25%

then it is 75% + 25%X5 = 200%

US is now in deep trouble, so .... I think the opportunity is still there, when there is no trouble, you have to be careful. Remember 97 crisis in Malaysia, I have checked the history of Maybank stock price in 97. It is RM2 before 2x split and Sime Darby RM0.5, see their prices now.

This post has been edited by klfong: Sep 24 2009, 11:18 AM

We can change the proportion, 50% cash + 50% index. Index return is not too bad either.
But to get 3 to 4x, the only way is to identify survivors of the crash that have been beaten badly. So I think we should let a few big and significant companies to file bankruptcy first, then here comes the panic, when there is a government intervention, then be prepared to invest in a few companies that is too important to fail.

EDIT: GM balance sheet is in crisis even before the crisis, so I do not think it is a risk that I will take

This post has been edited by klfong: Sep 24 2009, 11:38 AM

What if... it depreciates to 100K? Then now cash seems to be a better investment. Supply and demand is a very complex thing, keeping real estate as an investment will finally end up with a crash. When everyone keeps an additional house and wants to sell it when they retire, suddenly there is a slew of supply, then no buyers (assumption: population does not grow by 2x 20 yrs later), the price is going to crash.

EDIT: I do not know the current status of real estate market of Malaysia, nor I have the price index, but anyway, there is no investment with guaranteed return, must understand what you want to invest thoroughly.

This post has been edited by klfong: Sep 24 2009, 11:52 AM

You are actually speculating that others' do not speculate.

No la, I am just exaggerating. My main point is only invest what you really understand. You do not have to relearn others' mistakes.