Truth: In this age of globalization, economic downturns and bear markets observe no borders.
Partially true. It is true that globalization somewhat negates diversification of assets across boarders. Whether this remains true forever is still to be seen. And different countries perform at different levels even in a bear market. The Argentine stock market is performing quite nicely since the devaluation of the Argentine peso. That would have been a good time to get in.
MYTH 3. Reliable dividend payers are safer than other stocks
Dead wrong. Always assume that there is a REASON that companies don't pay dividends. Lack of real profits is a big one to watch out for. Without getting too long-winded, it really doesn't make sense to buy stocks that have zero yield, in the hopes of finding a "greater fool".
Truth: If what you want is super-safe bonds, the U.S. Treasury is the go-to place.
Dead wrong. They are only talking about default, but first of all the USA will not last forever, so the risk isn't really "zero" as we are supposed to learn in finance school; second, there is a huge risk of getting trapped in long-dated bonds that plunge during high inflation. There is nothing "safe" about bonds that collapse in value rather than defaulting.
MYTH 5. Gold is the best place to hide in a lousy economy. In early February, an ounce of gold traded for $910. That's just where it sat a year ago, when world economies weren't so bad off. But foreign and domestic stocks, real estate, oil and riskier classes of bonds have all tanked since, and now gold looks -- ahem -- as good as gold. However, gold does not typically benefit from a recession. As inflation slows, people buy less jewelry, industry uses less gold, and strapped governments sell reserves to raise cash.
DISINFORMATION. This is what someone has paid them to "teach" you. PRECIOUS METALS ARE TANGIBLE. THEY DO NOT MYSTERIOUSLY GO "POOF" like intangible liability assets do.
BTW, the implicit "definition" of "inflation" assumed in the article is bogus. The article is written as if the Keynesian business cycle (a mild oscillation between inflation and growth, and "deflation" and recession), were true. It is not.
Truth: The dollar has survived a tough test and remains the world's "reserve" currency.
Look at a graph of buying power of the $ over time. Look even at official government statistics. Then decide how much you want to bet on it!
Truth: Pick mutual funds that are free to search for good prices on stocks, whatever their labels.
I think this is called a "deframe". It sets you up to consider the wrong problem. American mutual funds are about the worst place to invest money, even during bull markets. Most of them (over 80%) do not keep up with the major indexes. It's better to just buy ETFs that follow the major indexes, than to buy an average mutual fund.
Part of the problem is that the very wealthy tend to invest elsewhere, so mutual funds tend to be full of garbage that the investment banks, stock brokers, and other wall-street pushers can't find other buyers for.
