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you put your money?

It just depends upon whom you believe. Many people are calling a bottom in the housing market and others are calling a bottom in the financials. Some have been calling a bottom for months. The housing market has not bottomed yet. There will be more mortgage resets in 2009. The damage has spread to prime as well as subprime. It has spread to commercial property as well.

The financial crisis is just starting to unfold. There is a lot of garbage being hidden by banks and others, off-record losses and toxic loan products. Personally, I wouldn't touch housing or financials.

What might come back from this perfect storm first? Just as you looked at your personal spending to determine what was a need and what was a want, we can look at the overall economy and see what is a need and what is a want.

The necessities of life are a safe bet for investing. That means commodities. We are still going to need food and shelter, even though some may be living in tents. We are still going to need energy for our cars, our houses, and whatever industry is left. I would invest in agriculture. I would invest in oil, gas, and alternative energies as well.

One investment, which is where my focus has been since 2002, is precious metals and base metals. The base metals are primarily used in industry. In spite of the slowdown in America, China, India, and other emerging economies are going to continue to build. As for precious metals, gold and silver, as the U.S. economy continues to fold and the dollar once again continues its precipitous fall, gold and silver will go through the roof.

Silver is the cheapest to buy, now selling at around $10/oz, down from its March high of $20+. Gold has broken above $800 after dropping into the low $700s. At its height, also in March of this year, it broke above $1,000. It is on its way back. If you can find them, silver coins would be a good starter investment. In the long run, silver will probably go up more than gold because it is an industrial metal as well as real money.

You can also expose yourself to commodities through mutual funds, ETFs, and mining indexes. Do your due diligence and don't risk more than you are willing to lose.

Learn more about this author, Bob Trowbridge.
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