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  So where do I put my money now, knowing that everything's going to blow up?

Isn’t it obvious? Cash. Maybe treasuries getting a 3-4% yield. Maybe some Euros. Maybe some GBP. Maybe some Yuan. Maybe some Yen.

Then you deploy the cash into equities if/when it does crash so you can buy at an inevitable discount.

Personally, I think we are just at the beginning of the boom.

That is why the current admin keeps talking about (and trying to push) printing more money. Because the obvious plan is to inflate out of the mess. Which they have been a little.

The big question is, will they succeed at accelerating it or not?

Either way, cash won’t be worth as much.

This won't work if you are on the shorter end of the yield curve. Obviously when investors say "cash" they mean money market fund at least.

Now people holding actual cash will have problems.

Considering most folks feel like actual inflation is > anything they can get from a money market account (and hard to argue with them!), that is why we have the problem we have.

If actual inflation > IR you can get for safe investments, it means inflation is working as designed. Mainstream economists make the argument that anyone who saves money is selfishly hoarding resources that could be spent or invested. The Fed is supposed to print money to purposely cause inflation, precisely to "tax" this unsocial behavior and incentivize consumption, riskier investments, and debt.

I don't personally agree with this argument. But everyone should be aware that the argument exists, many economists endorse it, and it is used to guide policy in many countries.

The person I'm responding to thinks everything is going to blow up. That means he expects equities to worth a lot less than now. The obvious thing to do is to hold cash.

So I hold ln to my cash, the bubble pops and I lose 10% to inflation because eggs will increase in price by 10%, just so I can buy stocks at a discount and wait 5 years for a 10% increase post bubble pop?

I'm not sure that's a good deal.

Sadly international diversification is far less effective during downturns, which is exactly when you need it. It really turns out that the old adage "when the US sneezes the whole world catches a cold" is borne out by the evidence: https://earlyretirementnow.com/2017/08/23/how-useful-is-inte...

I started getting concerned about the US stock market being overvalued in about 2019. If I'd followed my gut and ditched the US entirely I'd have missed out enormously.

Unfortunately the "guys, it's getting a bit frothy" stage can last for years and years. If you pull out of the stock market whenever everything's looking irrationally overvalued you're probably going to fall behind the unthinking approach of continually investing the same amount every month.

Although I don't think investments are easy to "bubble-proof" I feel like your career choices can make you more resistant to catastrophe. The strongest strategy of all (if it's practical in your lifestyle) is to be nationally and internationally mobile so that your job search can cover the entire world, and you pick whichever employer is most desperate to find someone. After that, you can sometimes transfer internally to teams that are more robust (in my industry we have teams that design new facilities and teams that run existing facilities - the ones that design new facilities are far more vulnerable to ups and downs as projects get cancelled). Finally, you can make lots of casual contacts in your industry (we sometimes get together for coffee or beer with other people in our city who do a similar job at other companies) - then when you're made redundant, you've got the inside information of where new roles might come from.

On the cost side of the equation, your choices of "how big a house & car can I afford?" should learn towards being more pessimistic, but often there's not huge scope for choice there in the short term.

Long story short, the glib answer to your question "where do I put my money now, knowing that everything's going to blow up?" is "leave it in the S&P 500 and be aware that one day it will blow up"

Is it really a bubble? The AI boom is often compared to dot com bubble but was that a bubble? Sure if you bought immediately before the crash and sold after you lost a lot of money. But if you were just consistently investing in web based companies from lates 1990s to 2010, how did you do? Probably pretty well. Web did change the world and create an immense amount of wealth in the world and markets. You're just focused on a short time frame.

Even the real estate bubble in 2008. If you bought a home in 2005 and sold in 2009, sure you lost a lot, but if you just invested in real estate from mid 2000s and kept it for 10 years, you prob did pretty well. Even the great depression had a sharp readjustment, but look at pretty much any 10‑year windows, including great depression, you'll see ~10% nominal and ~5–7% real annualized equity returns.

I think AI will be similar. It's a paradigm shift. Some of todays companies will go under and stocks will crash but over 10+ years, I think it will be a great investment and the industry will flourish, much like the tech or real estate bubble.

That last sentence is actually a good take imo.

What if it won't pop and just keep getting better?

Replacing more and more jobs as it goes?

Is this really a valid outcome, given the facts in the article?

Yes why not?

I think a lot of investors are looking at Europe/EU as a safe heaven, because it actually has strong democratic institutions that hold up the rule of law, and not some maddening kind that can tank your investments on his mere whim and a tech/fin oligarchy, eager to please and profit him while keeping the pyramid scheme going (while they build doomsday bunkers in New Zealand), until it all blows in the public's face.

The rule of law only applies to the peasants here in the EU as well .

At the risk of calling you on a deep-cut 2-step pun from your username, I think you meant "safe haven", not "safe heaven" :-)

So you mean I should buy EU"s 2% gross bonds?

That will be worth nothing when food increases by 10%. I'd rather lose the 1 point something net percent than do the song and dance of buying bonds.

No, EU companies.

I still feel like I'll get more benefit in reselling canned beans.