Thursday, March 22, 2007

Recession Proof Your Portfolio

I love headlines like that - I'm drawn to them like a moth to flame - and when I read the article under them I always come away with the same thought - people actually pay for that kind of advice - where did I go wrong. Ratings: Recession-Proof Funds is an article published by Yahoo finance. They go blah blah blah recession blah blah blah and when we're in one here's where you should invest - and they gave a dozen or so utility funds - oh boy oh joy - utility funds.

Of course they start out by saying
If the U.S. economy is really headed for a recession, you'll want to take shelter in investments that are relatively safe and offer steady yields.

"If" - what a wonderful word. Naturally there isn't one word in the article about how to recognize that we are going into a recession or something really useful like that only - if we are really headed for one. Given that the Fed only reports us being in a recession at least 2 quarters after we have been in it you just won't know will you? And people actually pay for this kind of advice - give me a break. Of course my theory as to why people pay for this kind of advice is to absolve them of all blame when their account goes belly up and they're tapped out - "wasn't my fault, Vern, I listened to every word ol' Jimmy Crack Corn Pone said and followed his picks to the letter."

Anyway the article then listed out some of their utility fund picks and I took a couple of their A+ funds and a couple of their A rated funds and ran them through the old mix master and this is what I came up with -

And you tell me which are the A funds and which are the A+ funds. I couldn't tell from returns - but that's not the best part - here's the best part - they are all turning up now - does that mean that we are going into or coming out of a recession?

Here's a tip - the red and the black are the A+, the blue and the green are the A's.

Whata racket. Barnum was only half right.


MachineGhost said...

This guy is almost 92 and has more common sense than all the glib idiots like Jimmy Crack Corn Pone combined.


Food stocks are a big part of a recession resistence.