The lead in from the today's Richard Russell daily missive.
August 27, 2009 -- One of the members of my family just had a bond come due, and this left her with a considerable amount of cash. She needs income, but I thought -- for the first time in my investing life I don't have any intelligent idea of where to put her money. I could leave it in a money fund, but that pays her very little. I could buy her a Nuveen closed-end bond fund that yields 4.5% tax free. But with monster current federal deficits and more coming up, I'm afraid of bonds. I could put her in blue-chip stocks, but the best blue-chips yield only 3% or less and is taxable. I could put her in Treasury bonds, but I don't trust the bond market because I believe the huge federal deficits will drive interest rates higher. I could put her in one of the commodity currencies -- Canadian or Aussie dollars -- but if or when the worldwide deflationary recession hits commodities, the Canadian and Aussie dollar will head down, and she'll be locked in with losses.
I could buy her GLD for the long-term but neither gold nor GLD pays any income.
Maybe, best to leave her in a money market fund, and await other potential opportunities. This is not an easy time for the average, confused American. In a way, everything hinges on the dollar, and the Fed is printing trillions of them under the slimy euphemism, "Quantitative easing."