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.

TheStreet.com 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.

2 comments:

MachineGhost said...

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

http://www.financialsense.com/editorials/gordon/2005/0102.html

QUALITY STOCKS UNDER 5 DOLLARS said...

Food stocks are a big part of a recession resistence.