Hypothetical limited nuclear exchange

[Blue Collar Guy]

Quote:

Originally Posted by Fermion Whew, back online. Ok, here is what happened. I start this thread and then an hour or so later my cell phone connection dies. I check it and there is zero signal..none. Not even -130dbm. I think that is strange. I then drive from our mountain property toward town. No signal. I have to pull over for some fire trucks. I get into town and things seem normal-ish. I drive to the AT&T store and notice all the employees sitting outside. They said all towers and internet are down, Verizon, AT&T, Sprint. I am currently outside the closed local library which does have internet. Nothing in the news about this outage, not even a forest fire (which is really what I was thinking since it has been so dry and smoke is everywhere). Did it cross my mind about what we are talking about. I have to reluctantly say yes. I have never seen zero signal before...always some sort of signal when you go into SIM status under About Phone. So carry on. Fermion is just alone and offline here in the mountains until someone fixes all the cell towers on various mountains which all went down at once.

I was wondering what happened to you

[Popeye]

Makes me think that an event like this may also include a massive cyber attack on infrastructure hitting most all of us. Now im getting depressed!

[Blue Collar Guy]

Quote:

Originally Posted by Popeye Makes me think that an event like this may also include a massive cyber attack on infrastructure hitting most all of us. Now im getting depressed!

I hope card services gets zapped first. I get a call every morning from them.

[Jerry1]

Between hurricanes and the current geopolitical situation, I can't help but feel like I should move to all fixed investments and get out of the market. Of course, every other time I felt this way, I did alright by getting out but failed to get back in soon enough to capitalize. Heeding the advice of this board, I have a very conservative AA but I'm comfortable with it and I'm doing everything I can to convince myself to stay the course. I am with a number of people that say once the damage is done, not much you can do and selling at that point is not a good strategy.

Based on my nervousness, I am going to do some basic things like get some cash in the house, keep the cars better filled up, increase the food and water stock piles and get more current in my physical printing of my financial statements. Nothing drastic, but realizing that stuff happens and to be a little better prepared. If prepper is a 10 on a 1-10 scale, I'm probably at a 3 and should probably move up to a 5.

[Blue Collar Guy]

Quote:

Originally Posted by Jerry1 Based on my nervousness, I am going to do some basic things like get some cash in the house, keep the cars better filled up, increase the food and water stock piles and get more current in my physical printing of my financial statements. Nothing drastic, but realizing that stuff happens and to be a little better prepared. If prepper is a 10 on a 1-10 scale, I'm probably at a 3 and should probably move up to a 5.

I think all these things are great. Nothing over the top, just good self preservation / For the water I buy Poland spring .5L bottles and rotate the stock , esp when they are on sale. For the food I got a free sample from a place called Wise. It was edible, we ordered one of their packages. They have a ton of different offerings. I always have cash on hand. You can accomplish all of the above in less than a week. Hopefully we all do this for an event that will not happen.

[frayne]

Stay the course, what other option is there really ?

[Another Reader]

If you look at the history of people that hate each other and have nukes, they have all acted fairly rationally. The fellow that is acquiring them now may not be rational. If he lobs one at Japan, his long time enemy, we will deal with nuclear fallout and the world as a whole would likely have to deal with him. Markets would be in turmoil until things settled down. If he waits until his engineers can build a working ICBM, he could lob one this way. The disruption would be severe and long term.

Might be thinking about moving east of the Rockies if it starts looking like he will do that. All that California real estate will not be nearly as attractive as it is now.

At my age, the radiation induced cancers won't be that much of a factor if the exposure is minimal. For younger people, mild to moderate exposure will likely decrease their lifespans.

[MRG]

Quote:

Originally Posted by Popeye Makes me think that an event like this may also include a massive cyber attack on infrastructure hitting most all of us. Now im getting depressed!

Doesn't matter if it's a cyber attack. If you take out enough infrastructure it's the same. Yeah folks have backup generators and back up phone lines. What if, the switches and larger datacenters no longer exist, along with power? What happens when you run out of fuel for the generators?

Quite a few unknowns. I don't know how to control any of them. Maybe I'll take a nap.

[clifp]

Interesting question.

I've actually played around with looking at 100 kiloton strikes on Oahu

Assuming they weren't in the US. I'm afraid I'd join the crowd and stock up on guns, ammo, and MREs.

Financially, I'd shift some assets to both New Zealand and Switzerland. I'd be tempted to get $20,000- $50,000 in cash. I've thought about gold but I'm still not convinced it is the currency for future crisises.

[samclem]

Quote:

Originally Posted by Fermion In the event of a limited nuclear exchange somewhere in the world and the prospect of a large disruption in trade relations, what would you do as it related to your personal finances and retirement portfolio?

I don't think that there's much I would do, or could do, regarding our finances after a limited nuclear exchange. Even if the US is not involved directly, I would think markets would be closed almost immediately and that getting a trade order, or even a wad of greenbacks from the ATM, might take a long time. And, even if I could place a trade, I don't think I'd be any better at outguessing the market in such a situation as I have been in the past. So, I'd hold tight. I'd be darn happy if I had some cash (in case things are "temporarily chaotic" rather than "entirely broken") and especially some things needed to see us through >in case< things got crazy.

Freedom of action to buy things now that will have much greater utility in the event of such a disruption--these opportunities exist today, and will largely be gone if hostilities begin. In regards to the thread topic, taking the steps now to assure the basic needs of my family can be met during a time of turmoil and disruption seems more productive than steps taken after the fact.

On a side note: There's considerable debate about the impact that an electromagnetic pulse (EMP) from a single high-altitude nuclear explosion might have on the US. For those interested in what the EMP Commission empaneled by Congress had to say, the exec summary is here. The report is controversial.

[Midpack]

Why would market timing work better during a limited nuclear exchange than any other time? If it happens, I suspect we'll all miss the opportunity to sell high, or know when to get back in (as is always an issue). So we'll either stay the course or sellout near/at the bottom, might as well stay the course...

[SecondCor521]

I wonder if RV's would be priced at a premium. Mobility and relative self-sufficiency might be two traits people are interested if this scenario occurs.

[Ronstar]

If I had insider info of an attack, I would withdraw a bunch of cash and move everything to cash in my IRA before the event. But I don't think I would have any advance warning, so I would probably just stay the course.

[marko]

Quote:

Originally Posted by frayne Stay the course, what other option is there really ?

Yeah. I look at 9/11 as the (to date) worst case scenario and IIRC the market fully recovered within a month or two. Even the Great Recession was a relatively short term event.

Of course a nuke would have much further reaching consequences, but aside from perhaps scooping up some bargains, I'd stay the course.

Market-wise everybody would be in the same boat so a drop in NAV would (might?) put everyone in a relative net neutral position, just at a lower price point. At least those who held on.

IOW if my portfolio dropped 50%, so would everyone else's and the economy would eventually adjust to a new water level.

[Fermion]

Hey, so yay! I am back online. At least one cell tower in the area has come back but no word on why they all went out at once, just a news report that there was a strange widespread cell outage. It is foggy here and 19% humidity. Wait, that is not fog, it is smoke! The air quality reading here is 2.1 It is fun to go to sleep in the middle of a forest with like 25 fires burning around you and no cell service.

Back to the topic. I expected "stay the course" would be popular and it is likely what we would do as well. As far as doing anything beforehand, I do not want to miss out on a relief rally if things blow over as they have every other time. The DOW could go to 25,000 while I sit here in the smoke with my #10 can of dried blueberries, shotgun, and cash. I do think having a little cash would not hurt. I already keep a year living expenses in pure cash in the bank earning 0.01% so it would not be horrible to have a little of that earning 0% but even more accessible.

After the event I would have to wait and see. If the market only dropped a little bit, like 10%, then I would probably move from current 70/27/3 to something more like 50/40/10.

[FIREd]

I already have a pretty conservative AA (not for geopolitical reasons, but to minimize sequence of return risk as we are still in the early stage of ER), so I'd probably stay the course. Some of my assets are held in Europe. And I have some cash and gold on hand too. I should probably start printing my Vanguard statements again, just in case. But there are too many possible scenarios to be fully prepared.

[Breedlove]

Sincerely , the problem on the peninsula will be over by the end of October and you can all sleep better .

Stay the course and we will be fine.

[Spock]

Quote:

Originally Posted by marko Yeah. I look at 9/11 as the (to date) worst case scenario and IIRC the market fully recovered within a month or two. Even the Great Recession was a relatively short term event. Of course a nuke would have much further reaching consequences, but aside from perhaps scooping up some bargains, I'd stay the course. Market-wise everybody would be in the same boat so a drop in NAV would (might?) put everyone in a relative net neutral position, just at a lower price point. At least those who held on. IOW if my portfolio dropped 50%, so would everyone else's and the economy would eventually adjust to a new water level.

We are now 8-10 YEARS into the "Great Recession".
* The labor participation rate is still near its recession low.
* The US federal reserve is STILL buying mortgage backed securities.
* "nearly $11 trillion or roughly one-quarter, of global fixed-income assets yielded below zero at the end of 2016, according to Bank of America Merrill Lynch."
* Non-US central banks are on pace to purchase 3.6 TRILLION in 2017 alone.
If the economy recovered, why does it still require life support?

As far as "everybodies NAV dropped so no-harm-done", your assets dropped but that does not mean your liabilities/expenses will drop to match.

[marko]

Quote:

Originally Posted by Spock We are now 8-10 YEARS into the "Great Recession". * The labor participation rate is still near its recession low. * The US federal reserve is STILL buying mortgage backed securities. * "nearly $11 trillion or roughly one-quarter, of global fixed-income assets yielded below zero at the end of 2016, according to Bank of America Merrill Lynch." * Non-US central banks are on pace to purchase 3.6 TRILLION in 2017 alone. If the economy recovered, why does it still require life support? As far as "everybodies NAV dropped so no-harm-done", your assets dropped but that does not mean your liabilities/expenses will drop to match.

Sorry, I was only referencing the stock market which I thought was the OP's main point and consideration. Personally, since March 09, I've done quite nicely in the stock market. Quite nicely; on-going recession or not.

As far as the NAV dropping, I would think if such a thing happened the prices/expenses would eventually drop as well. If everyone's income was cut in half prices would have to come down.

Having said that, my NW dropped considerably in the '08-'09 time frame but my dividends (which I mainly live on) stayed pretty much the same.

[Johanson]

I think I would stay the course. I'm 100% equities still.