Mutual Funds

One angle would be to go with a primarily international fund.

In order to decide if this is the right plan, it is necessary to form an opinion on the stability of the world economy. There is an idea now that the rest of the world isn't as dependent of us as they once were. If you believe this theory then an international fund would be a good choice. However, if you think that the global economy is still a reflection of the US economy then it might be wiser to stay in cash.

Personally, I think we could find some international funds which would be greatly independent of a US recession.

We can look first at ADR heavy state-side funds and spyders.


The other option is to put money into a "Bear Fund" which focuses on shorting. I haven't ever bought into a bear fund but now is as good a time as any I think--well, maybe two weeks ago would have been better. One such fund which has put up 6.59% YTD is the Rydex Inverse S&P 500 Strategy Inv which would be really good if you think the S&P is still on the way down.