The concerns are easy to understand, but overblown and contraindicated (i.e., one offsets the other) in many cases. IMO.
The stock market, though on a looong Bull run, is where you should keep most of your money. I predict that 2008 will be another UP year, and moving everything into fixed assets and/or commodities would be a big mistake! The market will not go straight up forever (we just had a 10% sell-off) but making decisions by looking only at the negatives is a recipe for disaster--financially speaking.
Right now the DOW is up about 8% for the year. I am up about 2.6X that on this market for the year.
I don't make my decisions based only on the negatives. But I am looking at several sectors that, should they fail are large enough to slam the economy into the ground. The financial sector is not even flinching on the $2/3 Trillion poured into it to bolster it up. If it was just a US issue, I might see it stabilizing but Germany and England, both who have tighter regulatory reigns have also had major defaults in the past six months.
If you read the whole article, there are some elements to it that do require "perfect storm" to make the house of cards fall BUT, many of the elements are already in place. Obviously, the SubPrime mess but also the Hedge funds that the SubPrimes were used to collateralize. Those are two BIG dominoes.
As for going to fixed assets or commodities, I don't like that as an option however I would not be surprised to see gold jack up hard if some of these dominoes start to tip, It is not, however where I would put 500K or so.
I played in the China market as it started its run about two years ago and have watched it grow [had a spider type fund for the SSEC] but sold it in July as I started realizing just how much of their market was tied to our Collateralized Mortgage market.
Right now, I am absolutely in the dark as to where to go. I think part of it is because I am pissed at the restoration biz as I fired the guys last week and am ready to close it up if I don't get a better mood for it.