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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

#141

Post by marcodiego »

Brazil had its own share of problems with hyperinflation during the 80's and early 90's. I remember the behavior it conditioned people.

Once people got their paychecks, they would rush to the supermarket to buy as much as they could, by the end of the month they wouldn't be able to buy that much with the same amount of money.

People ran ahead supermarket staff which updated prices so they could buy the same product at a previous price.

Gas stations had long queues during the night when there were news about about gas prices rising.

My father developed and interesting habit: whatever he bought, he would write in the box how much it cost in gasoline liters. That way we could have a good idea of how much each thing really cost. It was somewhat funny many years later finding old boxes written "Custou dez litros de gasolina".

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

#142

Post by me_me_mu_mu »

cko wrote: post #117
me_me_mu_mu wrote: post #75

Thinking about money and its hypothetical worth in X years is a waste of mind resources, at least for me. Instead, I'm going to just save 20-25% and spend the rest on being happy. If things go south, so what? I've got an expiry date and one day these things won't be a problem.

That's a pretty decent savings rate. When you say save, though, do you mean putting it in the bank or a diversified portfolio of factor tilted global index funds?

Index fund

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

#143

Post by chiph »

kingcharles wrote: post #46
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…

Funny side note: the State of Illinois spent a decent amount of public funds trying to decide whether to charge me with $100 trillion in currency fraud. The state crime lab said the currency I owned was the "most sophisticated piece of currency forgery" they had ever encountered. It was a single (real) $100 trillion bill from Zimbabwe that I carried in my wallet for fun. I assume they thought for some reason it was U…

I bought a couple of those and got them framed as a gift. The owner of the frame shop was concerned about me leaving them with him, until I pointed out that I was going to pay him more for the frame than they were worth.

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

#144

Post by foobarian »

nobrains wrote: post #61
Taek wrote: post #12

Earlier quoted context omitted.

It's about the lesson more than anything else. I really want my kids to learn how to save and be well practiced at it, even though the utility function doesn't make a ton of sense.

We put our children's savings (money for good school results, birthday money, eid money, etc.) into 3 separate envelops, equally: SPEND, SAVE, CHARITY. SPEND: They are encouraged to spend 1/3rd of the money. Whatever they want to buy. They have become online discount shopping experts, whether getting rubiks cubes, roller blades or harry potter merchandise. SAVE: 1/3rd goes into savings, which we will let them tap onc…

I like that this balances out the usual puritanical "must save at all costs" attitude. I feel my family was way in that direction due to circumstances (own a place to live with zero property tax, but very little pension/income). But now even though I do well for myself, I end up doing illogical things like never using an unopened set of oil paints. I feel that teaching to spend money/resources is also important (I could have used it at the very least!).

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

#145

Post by tehlike »

As a grateful person with sufficient income, we are contributing IRS gift limit of 15-16k per parent to kids account. Eventually when the time is right we will get her practice investing also with the hope that she will see how much her account has grown by the virtue of compounding. Before then we are planning to get her do chores for neighbors and learn to earn money and get her save.

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

#146

Post by ozim »

saagarjha wrote: post #99
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.

Because investing is non-trivial and nobody tells you how to do it.

There is a lot of people that really want to tell others how to do it.

Bad part they are mostly scammers or charlatans that are looking how to get that money for themselves.

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

#147

Post by shadowgovt »

gus_massa wrote: post #83
shadowgovt wrote: post #56

Earlier quoted context omitted.

The single greatest difference between the United States and Argentina is the world's debts, as tracked by the IMF, aren't denominated in any of the pesos or peso variants Argentina has used over the past several decades. Were the us to try and trade out dollars for NuDollars, they would find the dollar won't go away because the world will still be using it to trade and pay down its debts. The dollar being the world'…

If the US decides to replace 10 Dollars with 1 NuDollars, then the IMF and everyone else will just search and replace and fix all the paperwork. It's not hard at all. The problem may be if there is for many years a high unpredictable inflation that is higher than most developed countries. In that case other countries may decide to use Euros, Swiss Franc, Yuanes, Yens or whatever has a more stable value.

There's nothing in international law that makes that automatic.

It would create an interesting open question how the IMF would respond. In practice, it won't happen because raising the question would (as you noted) bea colossally stupid move for the US for global influence reasons. They have a lot of leverage from being the printer of the world's currency-of-record.

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

#148

Post by ghaff »

epgui wrote: post #116
logifail wrote: post #114

Earlier quoted context omitted.

> And you definitely don't hold cash. Holding cash has a lot of risk as well (Sorry, genuine questions) risk of what and compared to what?

Risk of loss, theft or physical degradation. Then there’s the costs of holding cash, which are known to give you a negative yield due to inflation (nevermind bank fees or insurance costs, etc)

I assume cash was being used in the normal financial accounting sense of the word as opposed to dollar bills in the mattress.

Yes, there's inflation negative yield. But especially in the low interest and inflation rate environment that has been the case until possibly recently, the difference between "cash" (i.e. default investment at a brokerage) and other very low-risk investments (e.g. high quality corporate bonds) has been pretty minimal.

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

#149

Post by capableweb »

epgui wrote: post #33
Taek wrote: post #12

Earlier quoted context omitted.

It's about the lesson more than anything else. I really want my kids to learn how to save and be well practiced at it, even though the utility function doesn't make a ton of sense.

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.

"Win at life" == "save money" == "owning stocks" ???

Winning at life is about everything that is not about money. Winning at life is being able to be happy no matter how much or how little money you have. Sure, up until one point, more money can help you get happier, but if you don't have the baseline happiness, you will never become happy and "win at life" no matter what. And up until a certain point, not even more money can make you happier if you're already miserable.

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