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Rest in Peace
United States
9104 Posts |
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Bedrock of the Community
Australia
21788 Posts |
I am siting on the sideline with cash deposits. They get around 5.7% with an iflation rate of 3.6%. That's 2.1% real growth. That's also pretty poor.
In the current climate, the inflation rate must eventually soar, to help pay off the debts with inflated cash. I am watching the inflation rate like a hawk.
When it rises, and I think that is inevitable, I will GIVE my fully paid for house to my kids, and buy another one for myself. I don't think real estate is necessarily the next thing to take off, but if it is efficiently owned and used by the occupier-owners, the value does not matter to me. I still need somewhere to live! Better to live in a fully paid for house than pay rent. I have never paid rent in my life, but HAVE paid out a mortgage. Just once. Long time ago.
At least that way, markets can be as toxic as they like, for as long as they like; they won't bother me. Don't have to worry about a job, I am retired. In my case, I don't have to worry about my superannuation investments, either. My pension is automatically inflation adjusted.
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Rest in Peace
 United States
9104 Posts |
Inflation adjusted may work in Oz, but over here, the gubmint is lying about inflation to save money on COLA.
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Pillar of the Community
United States
4989 Posts |
Note that the S&P 500 is up 61.77% from March 2009 through present.
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Pillar of the Community
United States
4989 Posts |
Note that a house incurs cost even if fully paid off -- maintenance, taxes, heating/cooling, and usually insurance.
The best way to minimize housing expenses is not really to pay off a mortgage - which are cheap and massively tax subsidized - but, rather, to buy the minimum square footage that you need to live in a reasonably priced neighborhood with low tax rates and cheap utilities.
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Valued Member
United States
257 Posts |
Where are you getting 5.7% of CDs? PM or share in the thread please!
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Valued Member
United States
421 Posts |
wow what a read! This follows on the heal of an article I just posted about the weak bullion market in the short time. But they say it will rise parabolicly over the next 1-3 years. I am hedging myself with a win/win sitaution lower grade key date silver for just over melt prices.
Don't really have the extra money to do major buying but a piece here and there will help.
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Pillar of the Community
United States
4008 Posts |
Quote:
Where are you getting 5.7% of CDs? PM or share in the thread please! That would be in Australia... and perhaps in New Zealand as well. Definitely not in the US. Not sure about Canada but probably a little higher there than here as far as CD rates go. Yes, we are currently in a traders' market and not in an investors' market. This appears to be toxic to a lot of people. In some ways, I suppose that it is. It is definitely much more volatile and unstable than the stock market has been for the past 35 years that I have been watching and participating in it. There are times when every investor should step back from the market, declare a personal time out, go to cash, and give themselves some time to consider what the best strategy is for them under these market conditions. Once they have determined what looks good to them now, they can feed money back into the market over a 3-6 month time period or other extended period that looks good to them. |
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Bedrock of the Community
Australia
21788 Posts |
Fenton: I argee with everything youm say. My next house will be minimalist to my needs.
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Replies: 8 / Views: 1,265 |
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Posted 11/22/2011 06:33 am
