investing abroad

[duvinnie]

With all the news lately about the threats to the dollar, most recently with
Russia considering a switch to the euro for oil trades...

see http://www.blackcommentator.com/60/60_cover_iraq.html

some are suggesting a bigger share of one's portfolio should go into foreign
stocks/ADRs/funds.

my question: how exactly does this offer protection? as a US resident am I
not still buying and selling (ADRs) in $$s? And if IBM does its business abroad
to a large percent, why does that not protect my IBM investment?

sorry for the lame q's, just trying to get some plain english answers...

[Code_Name_D]

1. It works the same way as stocks.

Buy low, and sell high. As you exchange dollars for a forien note, and if/as the dollar contiues to slide, you can later switch back to dollars and see a profit. Or, if disater strikes, you will actualy preserve your investment in a save harbor.

However. You should be aware of the conseqence. If you trade dollars to something else, you are contributing to the ferther slide of the dollar.

[rapier]

2. notes

On a simplistic level buying an ADR still hitches you to the value of the company in its local currency. That is more true the more the companies assets are located outside the US. ADR'S to my knowlege trade fairly closely to the level of their home market valuation and the currency change should reflect that.

But simplicity means not a thing because simplicity assumes that stocks are priced by some sort of rational means. There is nothing rational about stocks and they are not an investment, they are a speculation.

Diversifying your speculations is a good policy, for safety. It isn't a good policy for the nation or the world however to bet on stocks, even though everyone is doing it. The fact that everyone is doing it is what is making for an every wideing income and asset divide in favor of those at the top and giving corporations virtual total hegemony over government itself.

I'm pretty much convinced that buying stocks and bonds, ie. corporate financial assets, is the only way to 'invest'. I think the trend to corporatism is unstopable. It means the end of democracy and many kinds of freedom but it will probably outperform most other investments.

[Infinite Velocity]

3. PSAFX

Another way of investing aboad.........

http://www.prudentbear.com/funds_pshfund.html