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Ask HN: How can I prepare for hard economic times?

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Re: Ask HN: How can I prepare for hard economic times?

#121

Post by astrange »

ak_111 wrote: post #57
bluGill wrote: post #42

Work for a company that is protected and you will be okay. Food, soap, and other basic boring stuff will be in demand. Luxuries not as much, so games might be bad, or as cheap entertainment they might do good as people buy the games that will keep them all year to avoid the expensive entertainment they did instead. Really it is a guess as to what will do well. Most people have a job in bad times. The real problem is…

Paying off debt is usually good financial advice, but it is arguably the wrong thing to do if you expect higher and higher inflation (which you mentioned is your expectation). If you expect inflation to keep increasing, then one of the financially smart things to do would be to take as much debt as possible and purchase hard assets with the debt (such as land or commodities). For me personally, I wouldn't follow this…

Keep in mind that if you get your advice from the internet, the one constant thing you'll see is everyone is always claiming the economy is about to collapse and there's about to be hyperinflation. (And yes, we are seeing inflation for the rest of this year. No gigantic Volcker rate hikes though.)

I don't know why they don't constantly predict deflationary spirals instead, which are even worse, but it's probably childhood memories of the 70s.

Re: Ask HN: How can I prepare for hard economic times?

#122

Post by uxcolumbo »

ddorian43 wrote: post #113
dmje wrote: post #74

Diversify in as many areas as you can. In income terms, diversify away from a single source by learning new skills, training up in areas you're a bit rusty in, learning totally new ones. In savings or investments: diversify where you put them, spread them around so you're not dependent on any one scenario. In eating: eat more interesting and cheaper things. Become vegetarian, if you aren't already. In exercise: drop…

> Become vegetarian, if you aren't already. Try keto diet, or maybe even carnivore. Save yourself first, and then look up into saving the planet.

So on a plant-based diet you can't save yourself?

Plant-based meals require far fewer resources and is cheaper, which means maintaining societal stability when resources are becoming low - as there is more to go around.

A lot of farm land is being used to grow foods for livestock. We could use that land to grow food for ourselves.

Re: Ask HN: How can I prepare for hard economic times?

#123

Post by astrange »

mccorrinall wrote: post #105
Bombthecat wrote: post #60

Earlier quoted context omitted.

Absolutely agree, the crash is coming since ten years.. Any moment. I dont believe we will see a crash. Stocks might go sideways for quit a while. But companies will keep chugging along and employ people. Companies which will do well, are companies, telling people the world will end...

> Stocks might go sideways for quit a while. Nasdaq-100 is down 21.33% in 7 weeks. According to wikipedia a stock market crash is a decline "of over 10% in a stock market index over a period of several days". DAX declined even sharper (-16.5% in 12 days; -24% from recent highs). Just as a heads up: this is similar to the 1990's where Iraq invaded Kuwait. The Dow Jones Industrial Average dropped 18% in three months, f…

DJIA is calculated using some unusual math on only 30 stocks and you should probably ignore it. It doesn't work the same way any other index does.

Re: Ask HN: How can I prepare for hard economic times?

#124

Post by astrange »

Shadonototra wrote: post #64
vbezhenar wrote: post #58

Buy house with few dozens of acres of land. Buy tools to cultivate the land. Buy few sacks of potatoes, learn how to grow them. Buy few sacks of salt, ensure it's stored safely. Learn how to weld with gas, buy enough gas to be stocked. Buy medicines. Buy guns. Buy bullets and vodkas. There are many thing to do to survive in harsh times. But first thing you need to ensure: your own home where you can live; defenses ag…

When nobody has money, the first thing governments will go after is land/houses, you can't move/hide them ;) It is a mistake, gold is the only safe bet

What are you going to do with the gold? That's called bagholding, not a productive asset.

Actually, have you tried figuring out WHFIT taxes on $GLD? I ended up invested in it once and had no clue how you do it.

Re: Ask HN: How can I prepare for hard economic times?

#125

Post by jiggunjer »

joefife wrote: post #109
ganzuul wrote: post #90

Earlier quoted context omitted.

Fresh vegetables are cheap. Look at how immigrants do it.

You don't need to be an immigrant. Vegetables are cheap in UK supermarkets. 1kg carrots - 39p https://groceries.morrisons.com/products/morrisons-carrots-2... 2.5kg potatoes - £1 https://groceries.morrisons.com/products/morrisons-white-pot... And so on. Vegetables are cheap. It's frustrating seeing people complain about food but not learn to cook. Making casserole is cheap.

Raw, yes. But I use alot more seasoning with vegetables. I spend more time chopping and simmering. And the end result just isn't as enjoyable as a steak.

Re: Ask HN: How can I prepare for hard economic times?

#126

Post by arubania2 »

konha wrote: post #96
burntoutfire wrote: post #80

Earlier quoted context omitted.

They can't go after something they don't even know you have.

They can make it illegal to privately hold gold. Wouldn’t be the first time in history. Good luck trading your gold for goods and services under these conditions.

I don’t think outlawing gold would stop the trading. Drugs are also illegal. Also in a crisis such as the one being discussed the laws and the concept of legality doesn’t mean much.

Btw it is estimated that the last time gold was declared illegal, only about 5% of gold owners gave it up.

Re: Ask HN: How can I prepare for hard economic times?

#127

Post by AussieWog93 »

As an armchair expert:

I wouldn't worry too much about it. A recession is not even close to the worst thing that can happen to you (both as an individual and as a family). It's not cancer, divorce or a horrific car accident. The only reason they're noteworthy is because they affect so many people at the same time.

Worst case scenario, you lose your job for a year or so and your portfolio gets fucked, but you'll survive and your children probably won't even look back at it that negatively (I know I didn't when my old man lost his job).

Re: Ask HN: How can I prepare for hard economic times?

#128

Post by vishnugupta »

The following has served me well, regardless of economic conditions.

0. Empower and partner with your spouse to make all the financial decisions. They should know absolutely everything. You can’t do it alone.

1. Zero debt. For a while I had house mortgage that I repaid at the first possible availability of bulk cash.

2. Max out tax saving investments. Try not to pay one penny more tax than absolute minimum.

3. Max out life insurance you can afford. Don’t combine life insurance with investment.

4. Buy good health insurance over and above employer provided.

5. Monthly investment in equity index fund.

6. Only when you are done with all the above spend whatever remains on your monthly expenses.

7. Don’t postpone making of a will.

Re: Ask HN: How can I prepare for hard economic times?

#129

Post by astrange »

danuker wrote: post #85
Havoc wrote: post #37

Been wondering this too without much of a conclusive answer. Gold is already jumped so that is too late. Crypto seems correlated with stocks. I’m counting on a large gap between salary and expenses to save my ass

I think your analysis is rash. Instead of eliminating an asset completely, come up with an estimate of its value to the economy in the future, relative to the other assets (do this to cash also). Then, target your portfolio to match that distribution. While gold jumped, it doesn't mean it's over. And while crypto has been correlated with stocks, it still has some non-correlated part, introducing diversification, and…

> * Ukrainian stocks ("buy when there's blood on the streets" also means "invest when the country most needs it")

Keep in mind buying stocks in a public company doesn't directly "support" it; buying stuff from them, or buying their bonds, does. This is basically the issue with ESG index funds.

Re: Ask HN: How can I prepare for hard economic times?

#130

Post by CPLX »

Jesus these answers are hilarious.

Assuming you’re in the U.S. or similar you don’t need a farm, a shotgun, and a Honda full of silver ingots.

Diversify your savings, avoid consumer debt, and be wary of new monthly payments.

Consider changing to more stable job if appropriate.

That should do it.

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