Three countries where you’ll want to have exposure

January 4, 2012
Seat 5F, Undisclosed location at 35,000 feet

Most of us have grown up steadily ingesting a hearty line of crap that has made its way into the social consciousness. Governments can’t go bankrupt. Government bonds are safe. Banks are safe. Real estate always goes up. The US dollar is king.

Yet even the dullest bystander has begun to realize over the last few years that such platitudes are questionable, at best. Many independent contrarians have abandoned them altogether.

The big issue is this: there is no such thing as risk free. Government bonds carry risk. Cash in a bank carries risk. Cash under your mattress carries risk. The oldest, most well established companies in the world carry risk. There is no escaping it. We can no longer assume away risk with anything.

Even the nature of the market itself has become risky, particularly in the developed world. The price discovery mechanism no longer exists — a consequence of the market being dominated by fresh swaths of newly-minted money and the latest round of political innuendo.

As an example, a few months ago US Rep. John Larson introduced H.R. 2835. It’s purpose?

“To establish a joint select committee of Congress to report findings and propose legislation to restore the Nation’s workforce to full employment over the period of fiscal years 2012 and 2013, and to provide for expedited consideration of such legislation by both the House of Representatives and the Senate.”

What will they think of next — a bill proposing that the S&P 500 readjust to 2,000?...........