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The money I saved as a child would buy one picogram of gold today

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Re: The money I saved as a child would buy one picogram of gold today

#101

Post by MerelyMortal »

ghaff wrote: post #30
clamprecht wrote: post #13

I'm from the US but I lived in Argentina for about 5 years (2013-2018). It was a great lesson, and I'm seeing things in the US now that I used to see in Argentina. At the bank recently, they had a sign about the national shortage of coins. That was common in Argentina. Sizes of products getting smaller in order to keep the price the same - "inflacion escondido" (hidden inflation).

The ostensible reason for the coin shortage was COVID-related supply chains. Stores were also trying to minimize handling of cash especially early-on in the pandemic. This is overlaid with the fact that, in the US: 1. A lot of people (though certainly not everyone) don't use a lot of cash these days 2. Coin denominations have basically been unchanged since I was born--which was... not recently. So you have lower deno…

On reddit, I'm seeing people hoard coins because they believe the metal it is made of is more valueable than the currency it represents.

Re: The money I saved as a child would buy one picogram of gold today

#102

Post by wmanley »

bombingwinger wrote: post #42
Certhas wrote: post #8

Earlier quoted context omitted.

As a childhood lesson you don't need crazy inflation for this to hold true though. Anything that takes more than a few of months to save up to just doesn't make sense as a kid. Your disposable income goes up by factors of ten every few years. You have 2$ to spend at 5, 20$ at 10, 200$ at 15. Then it slows down but you might still get to 2000$ at 25. Saving as a kid really never seemed worth it to me.

It’d make more sense if your parents directed your savings to the stock market or in some other asset. Saving by itself is worthless if you can’t put the money to work.

The lesson isn’t how to invest, it’s how to not spend.

Re: The money I saved as a child would buy one picogram of gold today

#104

Post by epgui »

logifail wrote: post #100
epgui wrote: post #33

Earlier quoted context omitted.

I don’t understand why so many people “save money” but then just keep cash under a mattress or in a savings or checking account. If you want to win at life, you “save money” by purchasing non-cash assets like stocks.

> If you want to win at life, you “save money” by purchasing non-cash assets like stocks. Except when you don't. Between 1995 and 2000 I lived in a student house in the UK and one of my housemates (who was also a student, and from my recollection almost as broke as I was back then) was really into investing into the stock market during the dot-com boom. He bought both Lastminute.com (IPO March 2000 @ 380p/share[1], s…

I’d suggest that for most people, buying diversified index funds are a more appropriate strategy.

Nothing you do in life is risk free, even keeping cash under your mattress: the fact that there is risk involved does not change that this is how you make money. When you know that you’re guaranteed a loss of ~2%, at best, on cash, and that your expected real return on stocks is positive, well… That’s the point.

Re: The money I saved as a child would buy one picogram of gold today

#105

Post by kache_ »

logifail wrote: post #100
epgui wrote: post #33

Earlier quoted context omitted.

I don’t understand why so many people “save money” but then just keep cash under a mattress or in a savings or checking account. If you want to win at life, you “save money” by purchasing non-cash assets like stocks.

> If you want to win at life, you “save money” by purchasing non-cash assets like stocks. Except when you don't. Between 1995 and 2000 I lived in a student house in the UK and one of my housemates (who was also a student, and from my recollection almost as broke as I was back then) was really into investing into the stock market during the dot-com boom. He bought both Lastminute.com (IPO March 2000 @ 380p/share[1], s…

Well, you don't buy individual stocks; you buy slices of slices of everything to dissipate your risk towards variance. And you definitely don't hold cash. Holding cash has a lot of risk as well

Re: The money I saved as a child would buy one picogram of gold today

#106

Post by ghaff »

MerelyMortal wrote: post #101
ghaff wrote: post #30

Earlier quoted context omitted.

The ostensible reason for the coin shortage was COVID-related supply chains. Stores were also trying to minimize handling of cash especially early-on in the pandemic. This is overlaid with the fact that, in the US: 1. A lot of people (though certainly not everyone) don't use a lot of cash these days 2. Coin denominations have basically been unchanged since I was born--which was... not recently. So you have lower deno…

On reddit, I'm seeing people hoard coins because they believe the metal it is made of is more valueable than the currency it represents.

In some cases, that may be technically true but I suspect that the costs of turning bags of pennies into cash that is > than the face value of the pennies is iffy at best.

Re: The money I saved as a child would buy one picogram of gold today

#107

Post by anonporridge »

t43562 wrote: post #3

I remember my dad encouraging me to save my dollars and not spend them on choc-99 double ice-creams ($2.13). These were soft whip ice-creams with 2 cadbury's flake chocolates stuck in the side and they seemed like the closest thing to heaven on earth to me. What my dad said seemed logical though and I saved. When I was 16 I had a holiday job that earned me many ice-cream-worths but I kept it - didn't buy a bicycle or…

Never store your long term savings in a thing that someone who isn't you and never will be you can theoretically print an infinite amount of.

Even if you completely trust the people in charge today, you just can't ever be certain that they'll be in charge forever or that the environment won't change in a way such that they break your trust.

Re: The money I saved as a child would buy one picogram of gold today

#108

Post by anonporridge »

shadowgovt wrote: post #43
xiphias2 wrote: post #6

Earlier quoted context omitted.

I did the same thing for many years, until in 2013 the Cyprus bailouts woke me up...at that point I went all in on Bitcoin out of anger of the banking system, and haven't changed anything since.

I hope this works out for you in the long term; BTC isn't the most stable platform, but it could certainly be more stable than some national currencies.

Bitcoin is an unbelievably stable platform with an uptime of 99.98% with only 13 years to draw from. It's been sticking with it's algorithmically defined inflation rate with perfect predictability, unlike any other currency or scarce asset like gold, which depends heavily on incentives to mine and accessible reserves.

Don't mistake the volatility of the USD price of bitcoin (which is based on the erratic, unpredictability of human emotions and massively distrusted market decision making) with the complete and utter lack of volatility of the actual underlying system.

Re: The money I saved as a child would buy one picogram of gold today

#109

Post by epgui »

nurettin wrote: post #98
epgui wrote: post #33

Earlier quoted context omitted.

I don’t understand why so many people “save money” but then just keep cash under a mattress or in a savings or checking account. If you want to win at life, you “save money” by purchasing non-cash assets like stocks.

While generally true, there's the problem of what to buy and when. Then there's the problem of hindsight and the problem of that one stock everyone thought was going to the moon crashing and burning away your life savings. Then there are strategies and strategies that decide which strategy to apply and when, then you realize it isn't as easy as "just buy stonks".

The fact that it’s more complicated, or difficult, than the treatment I gave the subject in a passing comment doesn’t change the fact that it’s true generally speaking.

Re: The money I saved as a child would buy one picogram of gold today

#110

Post by Spooky23 »

Certhas wrote: post #8
t43562 wrote: post #3

I remember my dad encouraging me to save my dollars and not spend them on choc-99 double ice-creams ($2.13). These were soft whip ice-creams with 2 cadbury's flake chocolates stuck in the side and they seemed like the closest thing to heaven on earth to me. What my dad said seemed logical though and I saved. When I was 16 I had a holiday job that earned me many ice-cream-worths but I kept it - didn't buy a bicycle or…

As a childhood lesson you don't need crazy inflation for this to hold true though. Anything that takes more than a few of months to save up to just doesn't make sense as a kid. Your disposable income goes up by factors of ten every few years. You have 2$ to spend at 5, 20$ at 10, 200$ at 15. Then it slows down but you might still get to 2000$ at 25. Saving as a kid really never seemed worth it to me.

Childhood savings is about encouraging discipline and responsible thinking about money.

My kid saved about $200 in savings in elementary school. He parlayed that into a diversified stock portfolio, now around $4k several years later.

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