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3 hours ago, Dangerzone said:

Good points, that’s the beauty of the whole thing is it costs energy to produce those blocks and every 4 years the reward is cut in half. Yeah BTC while 12 years in is still kind of equivalent to early stages of the internet, still has a lot of development to happen. BTC was not intended for you to buy chocolate with it as you eluded to due to the high and slow transaction costs, what it lacks with that it gains in security from how the blockchain and cryptology was setup. 
You should checkout the lightning network and what strike is going to do, if you haven’t already heard about that. Very interesting stuff.

Yeah, I get where you’re coming from but count me as a skeptic. Where some see security and beauty, I see an imperfect technology that didn’t fulfill its original vision with significantly better alternatives (personally, for example, I believe eth will eclipse BTC in market cap in the next few years). It will be interesting to see if they can actually make second layer things like lightning network make sense or complete their rebranding to digital gold.

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On 2/9/2021 at 10:30 PM, Majestik Møøse said:

Yeah, I get it, $3m is the new $1m.  But there is a surprising divide, even amongst military officers, between those with no investments and those who know how to make money work for them.  So I never know which one I’m talking to, although I guess it’s the latter in this thread.

Some pilot friends of mine were giving Biden shit for having a $9m net worth - as if it were indicative of corruption - even though he has made the equivalent of six figures since the 1970s.

I agree on the divide.  I was actually in the former group while on active duty, although that was quite awhile ago.  Back then, $1m was an unfathomable number.  I went to grad school then entered the startup world.  I do have some play money in the short term market but even now I'm relatively conservative and long-term focused with regard to traditional investments.  I decided to keep that part of our lives simple so I can devote my effort to new technology development.  I just focus on net worth and liquid that allows a reasonable take.  After trial and error as well as some initial naivete I've been fortunate with a few home runs that have provided comfortable results.  

True on Biden.  If anything, he has no more corruption than the typical career politician.  

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38 minutes ago, Clark Griswold said:

Inflation fighting....

I’m considering shifting some cash to TIPS to hedge my bets and preserve cash principal

Any other recommendations?


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Clark, with the yields so low, the formula for inflation outmoded (in my opinion), and the fact that you owe taxes on the return, I'm not sure how useful TIPS are. There's a school of thought that Market and real estate are the best inflationary hedge...Time will tell; let us know what you decide to do.

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Clark, with the yields so low, the formula for inflation outmoded (in my opinion), and the fact that you owe taxes on the return, I'm not sure how useful TIPS are. There's a school of thought that Market and real estate are the best inflationary hedge...Time will tell; let us know what you decide to do.

Will do, good point (taxes on interest)

As to RE and equities, you may be right but as I just sold my investment property (probably moving so I wanted to start to roll up my footprint) and now have the equity in cash to think about protecting/growing
Equities, nervous about a correction, everything seems overvalued

I’m not pessimistic, but it seems like the late 70s again with potentially stagflation


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1 minute ago, Clark Griswold said:


Will do, good point (taxes on interest)

As to RE and equities, you may be right but as I just sold my investment property (probably moving so I wanted to start to roll up my footprint) and now have the equity in cash to think about protecting/growing
Equities, nervous about a correction, everything seems overvalued

I’m not pessimistic, but it seems like the late 70s again with potentially stagflation


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I'm not crazy about the parallels between 1990s Japan and 2020's USA, but at least we are still the strongest economy in the world. 

 

The number of people investing is stocks and crypto without a clue as to what either one is scares me a bit too. 

 

The only philosophy behind the current trajectory is "stocks always go up." That didn't work great in 99 for stocks or 08 for houses. But I'm not sure the millennials can sustain the trading volume required at these prices to keep the prices high, especially when the boomers start selling for retirement income... Uncle Sam can keep buying, but for how long? A millennial buying 5 shares of amazon at $2000 will not cover dozens of boomers who bought it at $100 selling to pay the mortgage on their homes... 

 

It has the makings of a cascade, but bubbles always go longer than you expect.

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1 hour ago, Lord Ratner said:

The number of people investing is stocks and crypto without a clue as to what either one is scares me a bit too. 

 

The only philosophy behind the current trajectory is "stocks always go up." That didn't work great in 99 for stocks or 08 for houses. But I'm not sure the millennials can sustain the trading volume required at these prices to keep the prices high, especially when the boomers start selling for retirement income... Uncle Sam can keep buying, but for how long? A millennial buying 5 shares of amazon at $2000 will not cover dozens of boomers who bought it at $100 selling to pay the mortgage on their homes... 

 

It has the makings of a cascade, but bubbles always go longer than you expect.

This raises a few questions that I don't know the answer to: What percentage of boomers' 401k's tied up in equities? The common school of thought is that as you get nearer retirement age, you blend in "safer" investments, typically in the form of bonds. Next, what percentage of boomers are passing away with a substantial sum still in their retirement accounts? If it's high, what are their kids doing with it? Next, what percentage of 401k's have bonds in them and how much? Another theory getting floated is that equities are being driven up because there's nowhere else great to park your liquidity. Interest rates have been so low for so long that the bond market makes hardly any sense to the average investor. If memory serves, even bond funds weren't great during March 2020. There was a big sell off and if you needed the cash in that time frame, you would've taken a haircut (though not as bad as the S&P). Where's @MilitaryToFinance? He's probably got some insight into all this.

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2 hours ago, Royal said:

Another theory getting floated is that equities are being driven up because there's nowhere else great to park your liquidity. Interest rates have been so low for so long that the bond market makes hardly any sense to the average investor.

🎯

 

The fed's attempt to control the economy with near zero interest rates has created a reality where the only place to make money is real estate and equities. But that's only for the ones that have any retirement at all...

https://www.businessinsider.com/personal-finance/baby-boomer-retirees-positive-about-retirement-savings-2020-10#:~:text=According to data from the,use the cash before retirement.

According to this the boomers own half of all equities, but very concentrated at the top.

https://www.cnbc.com/2020/10/17/older-americans-are-selling-the-stock-market-slowly-but-ceaselessly-to-junior-generations.html

 

What I can't tell from that article is whether or not that accounts for pension funds. I'm far more worried about the state and municipal pension funds all across the country that have their money tied up in equities, because they're underfunded and can't grow the funds anywhere else. But it reinforces the problem of retirement savings... The wealthy have all the stocks. 

We'll see. Just seems... Implausible that this ride continues forever

 

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The market will go down at some point.  The question is more how deep and how long? (Sts)

For retirement savings a 10-20% dip for a year or two should be recoverable.  If you get a decade of negative returns, that will hurt people's plans a lot.

 

If you are about to retire, it may be a good idea to have a couple years worth of money in super low risk savings/funds.  That way, you don't have to sell at a loss during a temporary crash.

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4 hours ago, Lord Ratner said:

What I can't tell from that article is whether or not that accounts for pension funds.

 

That's a severe problem; particularly for California. That old adage about 10% of the people pay 90% of the taxes (or whatever the exact figures are, it varies by state) is going to come to a head. It's conceivable that one day the last guy/gal that was helping generate solvency for the state eventually leaves...Then they raise taxes to compensate for the loss...Then more people leave...Then...Profit?

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19 hours ago, Lord Ratner said:

I'm not crazy about the parallels between 1990s Japan and 2020's USA, but at least we are still the strongest economy in the world. 

The number of people investing is stocks and crypto without a clue as to what either one is scares me a bit too. 

The only philosophy behind the current trajectory is "stocks always go up." That didn't work great in 99 for stocks or 08 for houses. But I'm not sure the millennials can sustain the trading volume required at these prices to keep the prices high, especially when the boomers start selling for retirement income... Uncle Sam can keep buying, but for how long? A millennial buying 5 shares of amazon at $2000 will not cover dozens of boomers who bought it at $100 selling to pay the mortgage on their homes... 

It has the makings of a cascade, but bubbles always go longer than you expect.

Yup

An equities market with fake / free / devaluated money = a ponzi scheme.

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On 1/30/2021 at 11:18 AM, Negatory said:

I’ve had multiple airmen pull out money from their TSP to “invest” in dogecoin. I guess, on the bright side, they’ll get a taste of reality and losses early in life.

Dogecoin at 40 cents.  At the time of this message, it was 3 cents.  New Camaros for everyone!

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19 minutes ago, disgruntledemployee said:

Allow myself to quote myself...

Dogecoin - WSJ Article

"A more than 12,000% rally this year in dogecoin, a cryptocurrency that was set up as a joke and serves no purpose, sent its price to a record 69 cents per token this week." 

Time to trade the Camaros in for Vettes.

Out

The C8 Z06 with the flat-plane crank version. 

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On 2/10/2021 at 4:39 AM, Negatory said:

Entirely untrue. ADA, BCH, BNB, XRP, LTC, LINK, XLM. All have fixed max supplies, and those are just the top 10. There are hundreds of cryptocurrencies with similar structures to BTC.

BTC is actually still in the process of inflation, by the way, with 18.6M currently mined and 2.4M still to be produced in the future.

On a side note, tons of people - myself included - hate BTC when compared to many other cryptos. Originally envisioned as “peer to peer cash” that wouldn’t require a bank, it now takes at least 10 minutes to send most transactions and costs $20 regardless of how much you’re sending.

Sending $10 to your bro? That will be $30. Oh, also, the energy costs are INSANE and entirely unsustainable, but that’s another topic.

Elon Musk investing in BTC actually convinced me that it really is dumb money that makes the world go round. But if Tesla can exist with a P/E ratio of 1300, there’s apparently a lot of dumb money. People will pump whatever the mainstream media will talk about. And now that people on BO are speculating about BTC, it’s probably getting close to time to sell.

Another fun fact: it takes approximately 4 times more energy to send a BTC transaction over the network than it does to charge a Tesla.

Source: have a pretty wide crypto “portfolio” and have for years. Was invested in BTC but am ENTIRELY divested from it for the last 4 years. Still made a little over 1100% this year on crypto currencies that aren’t so useless. 

What other crypto are you in? I did a bit of research after speaking to a buddy and recently through $5,000 into 5 different coins with the thought being I won't miss the money, and if something big happens, then great. 

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The leveraging levels are concerning as well. Maybe more concerning than everything else.

 

Right now that leverage only costs 4-6%. If the totally-transient-and-not-concerning inflation eventually forces the Fed to raise the rates...

 

Remember that when the market is over-leveraged, everything loses during the correction. We got a fast-paced glimpse at this in March of 2020. Stocks, bonds, precious metals, crypto, REITS... they all tanked. We're more leveraged now than were were then. Only cash survives the onslaught. 

 

 

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On 8/16/2021 at 12:23 AM, Lord Ratner said:

Only cash survives the onslaught.

Only cash loses if you stay on the sidelines during an inflationary time like we've seen since March 2020. "Time IN the market beats timING the market." 2008 levels were reached late 2013-early 2014 and, if you stayed in the market and kept adding capital, you made out handsomely and solidly beat inflation with one of the greatest bull markets in history. If you cashed out at the wrong time, it really hurt. For March 2020, we were back above those levels within a few months.

I'm not saying you're wrong when the downturn comes that cash is great, or that it's that easy to ride through a downturn. Hell, I'm guilty of not heeding my own advice some, too, because I thought I KNEW it was the correction. It's not easy to watch your money evaporate. But, it's certainly not much easier to watch markets continue up double digit %s while you're sitting in cash earning nothing/next to nothing.

If you're not trying to retire tomorrow or in the next 5 years, you're likely better off just to keep plugging away and not trying to time it. If it does crash, you're getting discounted securities to stuff all that airline retirement money into. If it doesn't, you'll feel awesome that you made all those gains while others sat in cash waiting for the shoe to drop. 

Then again, if it crashes tomorrow and you would have gone to cash but decided not to after this post, I don't want folks hating me. So, the BL is: do what you're most comfortable living with. But, try to not let emotion run your decision making. If the markets really fall off a cliff and everything tanks, we've all likely got bigger problems than worrying about our retirement accounts. 

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