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How This Ends

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Re: How This Ends

#431

Post by fny »

soared wrote: post #216
vintagedave wrote: post #171

Earlier quoted context omitted.

So for non-finance-experts, what should we be doing with our money? Investing in what? Keeping in the bank? It sounds from your comment like there is _nothing_ that won't be devalued, even gold. Is real estate worthwhile? (Note: I am in the EU not US.)

Unless you’re retiring in the next 10 years, or planning on purchasing a house in the next few years, then just make your emergency fund a little bigger and hold on to your job. Follow your normal financial planning. You’re not going to outplay market trends, and if you’re young/middle aged then it doesn’t matter any way.

Yes it does. If you invested near the dot com peak or the japan peak, you still haven't made your money back.

This notion of passive investing that has been pounded into peoples heads for years is complete bullshit and has only worked because there was always someone else ready to pay more for the same asset and because rates were perpetually held low. Some points to consider:

(1) You have fewer millennials than baby boomers, as the baby boomers cash out from their vanguard accounts, who makes up for the difference?

(2) If the S&P 500 contains companies built for a certain macro regime (low inflation, low interest rates), and the macro regime is shifting, you can be penalized by owning a set of assets that do not provide adequate returns (Tesla is currently the 5th largest weighting in the S&P, they don't pay you squat.)

Go look at charts of the S&P 500 beyond the last 40 years when rates were more variable, you'll see the market can at times be a shit investment vehicle that might not give you a return by the time you retire and on an inflation adjusted basis has a negative return!

Buy low, sell high. Save cash and be patient.

Re: How This Ends

#432

Post by wonderwonder »

ajsnigrutin wrote: post #427
Animats wrote: post #424

What if the COVID epidemic doesn't end in this decade? The US continues to have about half a million dead per year, and a lot of lost productivity due to long COVID. This is the most likely scenario. What if the war in Europe doesn't end in this decade? The optimistic scenario is that Russia bites off some of Ukraine and we go back to a cold war, with everybody in Europe building up serious military power to keep Rus…

Covid is over, the excess deaths are low, or even zero. War in ukraine would be a nothingburger if americans were involved (like noone cares about yemen, syria, now somalia, and noone cared about afghanistan, iraq, and even serbia). Most of the current problems that we have are caused by the politicians directly, and not by covid/war/whatever, and sadly, they're the first that will have to go, if we want to return to…

Not sure you are correct here. Ukraine war is in Europe, America's sphere of influence and features America's traditional enemy. America was involved in Afghanistan and Iraq which you claimed no one cared about. Russia and Ukraine produce a significant portion of the worlds food, energy and fertilizer supply.

The current situations are caused by politicians but politicians from dozens of countries. Politicians chose to invade Ukraine. Politicians financed the making of vaccines which provided enough confidence for economies to open up again. Politicians chose China's zero covid policy. Politicians flooded the market with money which led to inflation but also prevented a collapse during covid and allowed the poorest among us to survive. Politicians do both good and cause harm. They also provide representation, without them your other options are dictatorships or anarchy.

"they're the first that will have to go, if we want to return to somewhat normal future." how are you suggesting they "go"?

This is a normal future, there is very little going on right now that has not happened a dozen times before, its just people doing people things.

Re: How This Ends

#433

Post by idiotsecant »

polynomial wrote: post #379
SV_BubbleTime wrote: post #127

Earlier quoted context omitted.

>The “chip shortage” was fake. The actual issue was inflation since the start. Whew. Good new for me then! I guess I’m not 99 weeks out on a required part anymore.

99 weeks out?? :::jaw on floor:::

Don't worry, it's just the default value in the ordering system for 'we have no idea, probably never'

Re: How This Ends

#434

Post by unicornmama »

fny wrote: post #24

I'm going to explain what has happened so far. What happens next entirely depends on how inflation continues and the feds reaction. 1. We had zero percent interest rates. This causes the value of assets with cash flows out into the future (think speculative tech, Tesla) to accelerate. 2. We had massive herding in megacap tech. These valuations are high in part because for a decade you would not have beat the index wi…

In the hike case cash would not be wrecked. It is paradoxically a good position to hold cash. Consider this. When they hike rates you can roll very short term treasuries, and you can buy assets on the cheap.

Re: How This Ends

#435

Post by surfmike »

Nagyman wrote: post #415
chmod600 wrote: post #376

Earlier quoted context omitted.

I agree that local zoning is a problem, but I've seen a trend to try to turn it into the wild west. I'm not sure people building duplexes in R1 is really a solution. It seems like we need more medium density in commercial areas (e.g. four stories of apartments on top of one floor of commercial). That could bring down rents and improve quality of life, and improve the suburbs as well. If you drive by a poorly-maintain…

I've heard the idea to zone for one level above the average in an area, to avoid the wild west situation. Doubtful that would fly with some very rich single family neighbourhoods near cities, but perhaps it's too late for the gradual re-zoning and a more blunt approach is necessary. Aside... where the heck is tech in building housing faster? Where's the prefab and automated assembly? Too many building regulations? En…

This sub stack has some great coverage of those questions:

https://constructionphysics.substack.com/p/why-its-hard-to-i...

Re: How This Ends

#436

Post by lettergram »

chewz wrote: post #426
mejutoco wrote: post #411

Earlier quoted context omitted.

Without entering on who is winning and things like that. With the capital controls in place today idk how much the price of the ruble means.

You can google "Credit Suisse strategist Zoltan Pozsar - Bretton Woods 3"... His thesis is that we are going from dollar based monetary order to commodities based order. Not everyone agrees with Pozsar (I don't) but this is making waves. Russia forcing Europe to pay for gas in roubles is significant step, no matter the outcome on the battlefields... And financial markets reflect that fact through EURRUB and USDRUB...

Exactly, the war itself is much broader than Ukraine. It’s naive to consider this conflict a regional war.

Re: How This Ends

#437

Post by pm90 »

ajsnigrutin wrote: post #427
Animats wrote: post #424

What if the COVID epidemic doesn't end in this decade? The US continues to have about half a million dead per year, and a lot of lost productivity due to long COVID. This is the most likely scenario. What if the war in Europe doesn't end in this decade? The optimistic scenario is that Russia bites off some of Ukraine and we go back to a cold war, with everybody in Europe building up serious military power to keep Rus…

Covid is over, the excess deaths are low, or even zero. War in ukraine would be a nothingburger if americans were involved (like noone cares about yemen, syria, now somalia, and noone cared about afghanistan, iraq, and even serbia). Most of the current problems that we have are caused by the politicians directly, and not by covid/war/whatever, and sadly, they're the first that will have to go, if we want to return to…

Literally nothing in this comment is true.

Re: How This Ends

#438

Post by unicornmama »

vintagedave wrote: post #171
fny wrote: post #24

I'm going to explain what has happened so far. What happens next entirely depends on how inflation continues and the feds reaction. 1. We had zero percent interest rates. This causes the value of assets with cash flows out into the future (think speculative tech, Tesla) to accelerate. 2. We had massive herding in megacap tech. These valuations are high in part because for a decade you would not have beat the index wi…

So for non-finance-experts, what should we be doing with our money? Investing in what? Keeping in the bank? It sounds from your comment like there is _nothing_ that won't be devalued, even gold. Is real estate worthwhile? (Note: I am in the EU not US.)

I would be very scared to hold Euros. Either CHF or USD, or a mix. It is paradoxically better to hold cash than to invest in equity, bonds or real estate.

Re: How This Ends

#440

Post by cup_of_joe »

fny wrote: post #24

I'm going to explain what has happened so far. What happens next entirely depends on how inflation continues and the feds reaction. 1. We had zero percent interest rates. This causes the value of assets with cash flows out into the future (think speculative tech, Tesla) to accelerate. 2. We had massive herding in megacap tech. These valuations are high in part because for a decade you would not have beat the index wi…

"If inflation continues and the fed becomes aggressive with hiking, all assets are dead."

This sounds incredibly short-term-oriented and alarmist. Dead is a word to describe the end of something's existence.

Market turbulence is not a novel occurrence, nor are unsustainably inflated economies driven by cheap money and speculation.

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