I recently overheard a cyber security expert and his friend discussing the vulnerability of our financial system to a cyber attack, and the conversation raised a few questions in my mind. The approach of another year's end seems like a good time to re-evaluate the current state of my asset allocation. Maybe it would be a good time for you to assess your own investments, too.

First, let me be clear about my intentions. Take from this discussion what you will, but be aware that I do not intend to dissuade you from investing in the stock market, precious metals, real estate, currencies or anything else you might choose. Every investment carries a risk, and the value of any object or instrument is based on what someone else is willing to pay for it.

Consider, for example, a mundane commodity such as soap. During wars and other times of national emergencies, production capabilities might be shifted from soap to more critical commodities. As the soap becomes scarcer, those who want it are willing to pay more for it. It is even conceivable that its value could exceed that of gold or other seemingly high-value items.

With that in mind, let's go back to the cyber expert's conversation. With few exceptions, he says, our financial system is a series of electrical impulses being transmitted over various communication mediums. Specifically, computers containing trillions of bits of information record how much of an investment each one of us has in various companies and communities. For the most part, governments and companies do not issue paper certificates; instead, they use book entry methods to identify creditors, owners and debtors.

If our system exists in electronics, then what happens in the event of a massive cyber attack? Some small European countries have felt the effects of such attacks, and they can be crippling. The solution, according to our cyber expert, is to invest in hard assets. His own choice is real estate. During the depression, for example, fortunes were made through purchasing inexpensive land. Today, thatÂÂ’s not a bad strategy if you believe land prices will eventually rebound. On the other hand, many people have lost their life savings as a result of the current real estate bust - and real estate can be a very illiquid asset.

Then there is gold (or any precious metal), but that also depends on where you think the economy is heading. If you listen to enough experts, you might think that gold is the only intelligent investment. But before taking the plunge, ask anyone who invested in gold in the early 1980s what happened. That was a time when it seemed the price of gold (and silver) would skyrocket, but then the bottom fell out. For some people, their timing was simply awful. Even if you believe in the unlimited potential of gold or other precious metals, there is still the liquidity factor. When it comes time to pay the bills, how quickly will you be able to convert those assets into cash?

What about the currency or commodities markets? There are fortunes to be made there, right? The answer is probably yes, but then again these markets are highly volatile and depend on the computer world to keep accounts straight. At least the commodities markets offer liquidity not found in other alternative investments.

Back to the original question: Should I sell what I have now and find other investments? The truth is, I don't know what the best course is and it's probable nobody else does either. The prudent way, then, is to consult with knowledgeable professionals and make the best decisions based on risk tolerance and a practical outlook.

And on the subject of cyber attacks, we might be somewhat vulnerable, but thatÂÂ’s why financial regulators require massive security and multiple data backups.

Have a wonderful harvest holiday.