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Re: Inflation is scary stuff.

From 1869-79 there was an annual deflation of 3.8% and the economy roared. Imagine a $20 dollar bill sitting in the drawer going up 3.8% annually. What is that over 10 years? 45% if my math is right. Surely you must be kidding. That period started off with the Recession of 1869-1870. But that was f...
by hazlitt777
Wed Aug 21, 2013 9:11 pm
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: Boglehead Beer

Steven's point(Wisconsin) Octoberfest is excellent.

Also Leinenkugel's Creamy Dark is another favorite.
by hazlitt777
Wed Aug 21, 2013 8:53 pm
 
Forum: Personal Consumer Issues
Topic: Boglehead Beer
Replies: 386
Views: 47826

Re: Gold and DJIA: What is going on?!

Just remember if it is too rare, it could hardly serve as money, or a quasi money as is the case today. There has to be just the right combination of properties for a commodity to act as money: divisibility without loss of value, homogenous, large value per unit volume, high marketability/liquidity...
by hazlitt777
Wed Aug 21, 2013 8:39 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Inflation is scary stuff.

There are consequences of inflation that we usually don't think about. Consider someone with adequate life insurance coverage, but can no longer buy life insurance due to recent health changes. The financial protection (in real terms) for that person's beneficiaries can be significantly decreased b...
by hazlitt777
Wed Aug 21, 2013 8:33 pm
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: Inflation is scary stuff.

I'm sure all those who got jobs in that industry, appreciate deflation. Deflation is a monetary phenomenon, and affects prices across the board. Technology improvements which reduce the cost of a product relative to all other prices are a different phenomenon and not the same as deflation. Actually...
by hazlitt777
Wed Aug 21, 2013 8:31 pm
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: Inflation is scary stuff.

Deflation is wonderful. I love sales. It leaves more money in my pocket so I can buy other things, thus strengthening the economy. You would have loved 1929-1933. The value of a dollar rose 30%. People had so much money in their pockets and the economy was so strong they called it the Great Depress...
by hazlitt777
Wed Aug 21, 2013 8:29 pm
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: Inflation is scary stuff.

What this country needs is a really good five-cent cigar. -- Usually attributed to Vice President Thomas R. Marshall There are plenty of good five-cent cigars in the country. The trouble is they cost a quarter. What this country needs is a good five-cent nickel. -- Franklin P. Adams PJW I like that...
by hazlitt777
Wed Aug 21, 2013 8:25 pm
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: Gold and DJIA: What is going on?!

Then why wasn't every other metal tripled in value? Rick Ferri Just guessing that it is partly a function of its rarity. It stands to reason the more rare a metal, the more sensitive it will be to changes in demand. This is why I have been saying we should be buying Osmium. 1000x rarer than gold an...
by hazlitt777
Wed Aug 21, 2013 8:20 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

Then why wasn't every other metal tripled in value? Rick Ferri Just guessing that it is partly a function of its rarity. It stands to reason the more rare a metal, the more sensitive it will be to changes in demand. I would also hazard a guess that it is used as a de facto monetary metal to this da...
by hazlitt777
Wed Aug 21, 2013 8:15 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

And if you are in the lower tax bracket, I thought the tax rate was 15% upon sale. But it seems it is 28% across the board from what I can google now. (Anybody out there find something different let me know.) But it must be working for some that it gets taxed so high? Who knows? It's a 28% maximum ...
by hazlitt777
Wed Aug 21, 2013 8:11 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

...chemically the most stable element (I do believe)... No. The most chemically stable element is helium. Okay. Let's quibble:>) No, gold is one of the least reactive chemical elements, solid under standard conditions. It is a dense, soft, malleable, and ductile metal with a bright yellow color and...
by hazlitt777
Wed Aug 21, 2013 8:09 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

I just can not get on board with a rock that is dug up from the ground at high costs, then transported and guarded at high costs (to referrence Warren Buffett's latest shareholder letter). The investment authorities I follow and look to for advice suce as Jack Bogle, David Swensen, Warren Buffett, ...
by hazlitt777
Wed Aug 21, 2013 3:08 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

Without becoming a history channel "prepper", how do you protect your portfolio against extreme currency devaluations without owning something like gold or silver? Would international bonds do the trick? The problem with international bonds, is that those currencies also have a tendency t...
by hazlitt777
Wed Aug 21, 2013 2:48 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

Central bankers hold around 18% of the world's gold supply. Private investors around 16%. 52% is in the form of jewelry and 12% is in used industrially. http://en.wikipedia.org/wiki/Gold_reserve#World_gold_holdings There have been times when gold provided a real return, for example back in 1869-79. ...
by hazlitt777
Wed Aug 21, 2013 12:46 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

Clive,

I would just hold 5-10% of ones portfolio in gold and rebalance. Best to do it before prices get higher...

http://www.usagold.com/cpmforum/2013/08 ... this-year/
by hazlitt777
Tue Aug 20, 2013 9:52 am
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Inflation is scary stuff.

There are consequences of inflation that we usually don't think about. Consider someone with adequate life insurance coverage, but can no longer buy life insurance due to recent health changes. The financial protection (in real terms) for that person's beneficiaries can be significantly decreased b...
by hazlitt777
Tue Aug 20, 2013 9:49 am
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: Inflation is scary stuff.

I just bought a car battery for my Jeep. 109 dollars! Just a handful of years ago, one could get a battery for 75. I think inflation is a lot higher and more insidious than one thinks. Therefore I own, along with my stocks and bonds, gold to provide some protection. It seems you should have bought ...
by hazlitt777
Tue Aug 20, 2013 9:44 am
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: Inflation is scary stuff.

I just bought a car battery for my Jeep. 109 dollars! Just a handful of years ago, one could get a battery for 75. I think inflation is a lot higher and more insidious than one thinks.

Therefore I own, along with my stocks and bonds, gold to provide some protection.
by hazlitt777
Mon Aug 19, 2013 9:15 pm
 
Forum: Personal Finance (Not Investing)
Topic: Inflation is scary stuff.
Replies: 42
Views: 4019

Re: My Take on Gold

Hi Hazlitt, Why 10% specifically? And why ignore the macroeconomic motivations and actions of the Indian government? At 10% will the drain of currency stop? Will the decline of the Rupee slow? Will the fundamental responsibility of the government to facilitate private commerce disappear? Will the d...
by hazlitt777
Fri Aug 16, 2013 5:50 pm
 
Forum: Investing - Theory, News & General
Topic: My Take on Gold
Replies: 213
Views: 17482

Re: My Take on Gold

Despite record Chinese and Indian buying, the price of gold is still down nearly 20% year-to-date. What will the price fall to when they stop buying? Rick Ferri Why would they stop buying at this point? Indians save over 30% of their income on average and hold 10% of their savings in gold. The Indi...
by hazlitt777
Fri Aug 16, 2013 4:59 pm
 
Forum: Investing - Theory, News & General
Topic: My Take on Gold
Replies: 213
Views: 17482

Re: Gold and DJIA: What is going on?!

The only data you need to understand gold and stocks is in the article written by ?Erb and Harvey or is that Erb and Campbell?? Either way they looked at monthly returns of gold (spot price of course) and stocks (?dow vs. Sp500 return) since early 1970's to current. The results: when stocks are up ...
by hazlitt777
Fri Aug 16, 2013 4:43 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Gold and DJIA: What is going on?!

Well this year gold and the DJIA have been getting a lot of attention for their short term direction...stocks up, gold down. I thought for balance I would put this out there. You are right of course...percentage wise what has happened in the last seven days isn't earth shattering. I just thought I w...
by hazlitt777
Thu Aug 15, 2013 9:26 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Gold and DJIA: What is going on?!

Has anybody come across any insightful articles about what is going on in the gold and stock market? They are acting in a very negatively correlated and manner, and seem a bit volatile. I would appreciate some articles you may have come across on the topic. Here is one I came across: http://kingworl...
by hazlitt777
Thu Aug 15, 2013 8:53 pm
 
Forum: Investing - Theory, News & General
Topic: Gold and DJIA: What is going on?!
Replies: 137
Views: 8264

Re: Precious metals fund VGPMX

z3r0c00l wrote:Wow 25% of your portfolio in gold? That would keep me awake at night...


Well, the Permanent portfolio isn't for everybody. For you...5%.
by hazlitt777
Tue Aug 13, 2013 5:48 pm
 
Forum: Investing - Help with Personal Investments
Topic: Precious metals fund VGPMX
Replies: 41
Views: 6060

Re: Bitcoins Purpose in a Portfolio

Just came across another article on Bitcoins. Thought it was worth posting. I must warn you it isn't favorable.

[OT article link removed by admin LadyGeek]
by hazlitt777
Tue Aug 13, 2013 5:46 pm
 
Forum: Investing - Theory, News & General
Topic: Bitcoins Purpose in a Portfolio
Replies: 103
Views: 9321

Re: Precious metals fund VGPMX

Newbie here. Hold a diversified portfolio (across US total mkt, developed market, and US total bond). Pre-paying home mortgage with 3.75% interest with monthly payments. Had some idle cash. Needed opinions from forum users on the Vanguard precious metals fund VGPMX. Any thoughts? The VGPMX is first...
by hazlitt777
Tue Aug 13, 2013 9:56 am
 
Forum: Investing - Help with Personal Investments
Topic: Precious metals fund VGPMX
Replies: 41
Views: 6060

Re: 1987 stlye crash on the way?

The next crash might not be 1987 like, but there will be another crash. Its the nature of the system. Who knows what this next one will be like, personally I think we are setting ourselves up for bigger, faster, and deeper crashes. I agree. That is why it is important to be diversified, so when it ...
by hazlitt777
Fri Aug 09, 2013 2:40 pm
 
Forum: Investing - Theory, News & General
Topic: 1987 stlye crash on the way?
Replies: 55
Views: 5870

Re: trip to iran, suggestions?

I have been to Iran for work. I was there for a month or so a couple of years ago. (I am in a rush so I'll write this quickly) Thoughts: - The traffic is unbelievably awful. This is the number one most dangerous terrible thing you will run into constantly. India / China / Latin America are better t...
by hazlitt777
Sun Aug 04, 2013 1:23 pm
 
Forum: Personal Consumer Issues
Topic: trip to iran, suggestions?
Replies: 25
Views: 3520

Re: The Many Myths of Warren Buffett

My take on him is that he is quite well politically connected and that this gives him an edge with much of his investing. It may not have always been that way, but I take with a grain of salt what he says and does in these last years. The rest of us should diversify and index. How would this give h...
by hazlitt777
Sun Aug 04, 2013 1:12 pm
 
Forum: Investing - Theory, News & General
Topic: The Many Myths of Warren Buffett
Replies: 29
Views: 4903

Re: The Many Myths of Warren Buffett

My take on him is that he is quite well politically connected and that this gives him an edge with much of his investing. It may not have always been that way, but I take with a grain of salt what he says and does in these last years.

The rest of us should diversify and index.
by hazlitt777
Sun Aug 04, 2013 12:29 am
 
Forum: Investing - Theory, News & General
Topic: The Many Myths of Warren Buffett
Replies: 29
Views: 4903

Re: Dave Ramsey close to 100% stock

You are forgetting commodities like gold and silver...which have for thousands of years served as money. They can help one diversify away from stock risk. If you look at what has been used as money for the most people over the longest periods of time, it would be cowry shells (like from the beach)....
by hazlitt777
Sat Aug 03, 2013 1:13 am
 
Forum: Personal Finance (Not Investing)
Topic: Dave Ramsey close to 100% stock
Replies: 65
Views: 6429

Re: Dave Ramsey close to 100% stock

For folks who prefer to avoid debt (lend and borrow), what other options are there for investing to reduce the risk of stocks? You are pretty much left with cash/stock. Or would you consider protective puts and maintain a higher equity allocation? Good conversation... You are forgetting commodities...
by hazlitt777
Fri Aug 02, 2013 8:49 pm
 
Forum: Personal Finance (Not Investing)
Topic: Dave Ramsey close to 100% stock
Replies: 65
Views: 6429

Re: Homes as Investments?

For those who think of a home as an investment, ignore this post. For those who don't think of a home as an investment, I have a question. Do you invest in REITs, or REIT funds? What is the difference? It is the same as your home being a single investment, like KO, XOM, etc. as opposed to TSM, whic...
by hazlitt777
Wed Jul 31, 2013 7:55 pm
 
Forum: Investing - Theory, News & General
Topic: Homes as Investments?
Replies: 101
Views: 5964

Re: Help us pick a car, please!

Take a look at the Chevy Cruze Eco. If you are okay with a manual tranmission, it gives you 41 mpg on the highway and, after test driving it, I felt it handled well...like a midsize car with plenty of space for two people. I'm 6'2" And it isn't a hybrid.
by hazlitt777
Wed Jul 31, 2013 4:07 pm
 
Forum: Personal Consumer Issues
Topic: Help us pick a car, please.
Replies: 44
Views: 3756

Re: Homes as Investments?

Houses are money pits. But they beat sleeping out in the rain. I would be very interested in reading a well researched book on the pros and cons of buying versus renting. Certainly, if one is confident they won't have to sell in under five years, I can see justifying purchasing a home. But it seems...
by hazlitt777
Tue Jul 30, 2013 9:32 pm
 
Forum: Investing - Theory, News & General
Topic: Homes as Investments?
Replies: 101
Views: 5964

Re: Really hard to avoid "Keeping up with the Joneses"!

Start by reading "The Millionaire Next Door." You will find through the research of two university professors what the lifestyle issues you describe are really all about. The millionaire next door does not lead the lifestyle you describe and the authors even address the issue of parents s...
by hazlitt777
Tue Jul 30, 2013 8:54 pm
 
Forum: Personal Consumer Issues
Topic: Really hard to avoid "Keeping up with the Joneses"!
Replies: 93
Views: 10150

Re: Interesting Debt Theory...

This thinking may also cause something much more dangerous; having credit card debt as a "normal" feeling. Nooo!! Ive always hated "The Psychology of Debt" argument (I knew someone would bring it up). With money, finances, and anything else that has concrete numbers, we have the...
by hazlitt777
Tue Jul 30, 2013 8:45 pm
 
Forum: Investing - Theory, News & General
Topic: Interesting Debt Theory...
Replies: 48
Views: 3294

Re: Homes as Investments?

Certainly, if one is confident they won't have to sell in under five years, I can see justifying purchasing a home. Where does this number of years come from? We just purchased a house and after closing costs and all, the HUD-1 showed us getting almost half of what each of the listing and seller ag...
by hazlitt777
Tue Jul 30, 2013 8:01 pm
 
Forum: Investing - Theory, News & General
Topic: Homes as Investments?
Replies: 101
Views: 5964

Re: Homes as Investments?

Houses are money pits. But they beat sleeping out in the rain. I would be very interested in reading a well researched book on the pros and cons of buying versus renting. Certainly, if one is confident they won't have to sell in under five years, I can see justifying purchasing a home. But it seems...
by hazlitt777
Tue Jul 30, 2013 5:09 pm
 
Forum: Investing - Theory, News & General
Topic: Homes as Investments?
Replies: 101
Views: 5964

Re: Justice and Marc Faber

Treasuries are sold at auction in an open market. Nobody forces anyone to buy them. If people don't think they are paying enough interest, they can vote with their dollars and buy someone else's bonds. If you think the interest rates on U.S. government-issued bonds are "artificially low,"...
by hazlitt777
Tue Jul 30, 2013 4:34 pm
 
Forum: Investing - Theory, News & General
Topic: Justice and Marc Faber
Replies: 7
Views: 1134

Re: Justice and Marc Faber

So for the record: interest rates are NOT 'artificially low'. There is no 'natural' level of interest rates. In fact on a Keynesian model, interest rates should now be negative, so they are too high. You're right. When you increase the money supply by over 85,000,000,000 a month through bond purcha...
by hazlitt777
Tue Jul 30, 2013 4:26 pm
 
Forum: Investing - Theory, News & General
Topic: Justice and Marc Faber
Replies: 7
Views: 1134

Homes as Investments?

I wish more people would avoid the mistake of looking at their home as an investment, thus bigger being better. I think it would be better viewed as a consumer item, thus keeping our homes more modest, and so leading us to being a nation of greater real wealth. I thought this article drives this hom...
by hazlitt777
Tue Jul 30, 2013 4:18 pm
 
Forum: Investing - Theory, News & General
Topic: Homes as Investments?
Replies: 101
Views: 5964

Justice and Marc Faber

I found this interview thought provoking. (He has in other places mentioned he personally is invested 25% cash, 25% stocks, 25% gold and 25% real estate.) He addresses in this 9 minute interview, amongst other things, the impact of artificially low interest rates especially upon the common man and h...
by hazlitt777
Sun Jul 28, 2013 11:37 pm
 
Forum: Investing - Theory, News & General
Topic: Justice and Marc Faber
Replies: 7
Views: 1134

Re: [Sad news - Pat Larimore]

Dear Taylor,

You have my deepest condolances. And your son's video was a beautiful tribute.

peace be with you,
Joe
by hazlitt777
Mon Jul 22, 2013 2:49 pm
 
Forum: Investing - Theory, News & General
Topic: [Sad news - Pat Larimore]
Replies: 225
Views: 15935

Re: Detroit Files for Bankruptcy: Impact on Vanguard Munis?

It is important to remember there are also other cities that have and can go bankrupt. Some are just not on the radar yet.
http://www.washingtonpost.com/blogs/won ... n-one-map/
by hazlitt777
Fri Jul 19, 2013 4:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Detroit Files for Bankruptcy: Impact on Vanguard Munis?
Replies: 19
Views: 2388

Re: bitcoin bust; bitcoin etf

In theory they have value because the supply is finite. The supply is currently growing asymptotically towards a larger, yet still finite supply. Is there some contractual agreement with those who purchase them that the supply will only grow at that rate? Will it be enforced in the courts? It just ...
by hazlitt777
Thu Jul 11, 2013 12:10 am
 
Forum: Investing - Theory, News & General
Topic: bitcoin bust; bitcoin etf
Replies: 52
Views: 5406

Re: Thoughts on adding Vanguard Precious Metals and Mining F

This fund is wonderful. I use it for tax loss harvesting and so far I have offset a good chunk of this year's realized stock gains and hope to extend into 2014. I sell it then buy GTX which is down 30% from when I purchased it. Traders should pay me as a reverse barometer. Better to go with gold bu...
by hazlitt777
Thu Jul 11, 2013 12:06 am
 
Forum: Investing - Theory, News & General
Topic: Thoughts on adding Vanguard Precious Metals and Mining Fund
Replies: 44
Views: 8664

Re: Road trip ideas

I've always found the DK publishing books helpful.

http://www.amazon.com/dp/0756685559

In my state, I found some good "road trip" guidebooks. You might be able to do the same out there.
by hazlitt777
Thu Jul 11, 2013 12:05 am
 
Forum: Personal Consumer Issues
Topic: Road trip ideas
Replies: 30
Views: 2357

Re: My Take on Gold

stevewolfe wrote:You left out dividends in your calculation of stock market losses... And you rounded up...


The dividends included, my point still stands. And far as rounding up...I was unbiased in my rounding.
by hazlitt777
Sat Jun 29, 2013 9:16 pm
 
Forum: Investing - Theory, News & General
Topic: My Take on Gold
Replies: 213
Views: 17482

Re: Is Technical Analysis a Waste of Time?

Burton Malkiel does a good job covering the issue of Technical Analysis in his book, A Random Walk Down Wall Street. I'm not really a fan of technical analysis. It would take a lot of time to apply and it still strikes me as highly subjective. But it is kind of entertaining listening to people try t...
by hazlitt777
Sat Jun 29, 2013 4:11 pm
 
Forum: Investing - Theory, News & General
Topic: Is Technical Analysis a Waste of Time?
Replies: 66
Views: 12370
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