[Nicodimas]

Quote

Paying off debt is probably not one of the things i would include. If crash is iminent why throw the money away?

Its because Debt is a form of Slavery, like Taxes. They tell you NEED this stuff over here. That you are entitled to all this neat stuff, which in reality we don't need. If you can't afford it you don't need it. Make sure you have cash on hand for everything you buy. As you move toward this goal it start's changing the way you look at stuff and adopting the ideology. Saving up for stuff to me imho makes you appreciate everything much more. Yea I have CC's for emergencies and don't go near them.

About the only true debt I have is a mortgage payment as I am just renting from the bank is the way I look at it. Have 6-12 months of all expense on hand as cash and Zero debt. I am even still investing in the market as I believe America will sort it's stuff out. I just have my own person Insurance plan if a big disaster, war, market crash. etc happens things that have happened in the past many times.

It really changes the way you start looking at everything.

[Slow Ben]

I have a few friends who might argue that debt and taxes are a HELL of a lot different than slavery.

Not trying to be an a-hole, but some might take offense to it.

This post has been edited by Slow Ben: 13 March 2009 - 07:19 PM

[frookenhauer]

In terms of preparation, I've stared to buy loads of tinned food and have just finished digging the shelter in my back garden, all i have to do right now is to pour the conrete over the top and hey presto, my bomb proof, total share annihalation, economic collapse, world ending, mega big shit problem will have been countered.

In terms of preparation I do what most sane people would do, I've increased my emergency fund from 3 months to 5 months my outgoings, I've been going to the gym and getting healthy and I have been eating meals as healthily as possible. I also drink plenty more water and am reaching the magic 2 litres a day now and I'm only drinking very cold water cos I use up calories heating the stuff up to body temperature. I am also following the news (avidly) on companies and stocks and am readying myself to begin investing in the stock market in earnest as soon as the new economic year starts in April 5 2009.

What I'm basically saying is that there is a land of opportunity out there for the bold, the brave and the intelligent. Buy shares, buy shares buy shares. Nic, trust me in 5 years time things will be the same as they were in the peak of 2007 and still climbing until the next mad rush. if you invest in the stock market right now, right this very instant you could...double your money, triple your money, quadruple your money...hell it could jump by 20 times and I would not be surprised.

[Cold Iron]

Frookenhauer, on Mar 14 2009, 06:15 AM, said:

hell it could jump by 20 times and I would not be surprised.

What about a googleplex frook?

[frookenhauer]

If only! I do not think that is likely...Unless you pick an investment on the Alternative Investment Market that suddenly has a major breakthrough which propels them to the forefront of their industry and converting shares that are worth pennies into googleplex pounds...highly unlikely...But an investment as described could literally make you a millionaire overnight for a small outlay. Shares are beautiful things and risky as hell, but my god they are beautiful.

[Slow Ben]

I read this in the paper this morning. Its this kind of stuff that really, really, really just pisses people off and just makes the big companies look bad. Am I the only one who gets angry (I know, it doesnt do any good to) at this stuff?

http://www.courierpress.com/news/2009/mar/...-stoke-outrage/

[Anomander]

Goddamnit that pisses me off! I don't care if they were under contract to pay those bonuses, it's a bloody recession. Those CEOs should all have been required to waive those bonuses in order to keep their jobs. I hope they fire the whole lot of 'em for this.

Hell, I was in a somewhat good mood today too.

[Aptorian]

The most annoying thing about these things is that they are normally a part of their contract. That means whether they work for the company for a day or 20 years, they get the golden handshake.

Same thing with ministers in Denmark. If they sit on a ministerial post for 4 years or even less they get a ministers pension for the rest of their life, something like half a million danish krones a year, even if they're only thirty and they then go on to become leaders in the private sector or what ever.

[frookenhauer]

How does one become a minister in your beautiful country?

The aig bonuses are a bit rubbish, but shit happens and it could have been worse... The half billion figure was just ridiculous. Balls to the lot of them.

Okay it's the start of another week and the sky is still not fallen on our heads. Great news all round. And twenty two days till I start the utterly scary business of putting my money where my mouth is. How exciting!

[Shinrei]

I'm with Frook. This is an economic downturn. The consequences will last for a few years, even if we start to rebound.

However, this is a chance for us little guys to make money! Transfer of wealth baby!

And as an aside, Nicodemus, you are overlooking that there is such a thing as "good debt".

[HoosierDaddy]

Shinrei no Shintai, on Mar 16 2009, 11:00 PM, said:

I'm with Frook. This is an economic downturn. The consequences will last for a few years, even if we start to rebound.

However, this is a chance for us little guys to make money! Transfer of wealth baby!

And as an aside, Nicodemus, you are overlooking that there is such a thing as "good debt".

Are you really serious about that? Transfer of wealth? Maybe a little, but the rest will remain where it always has: the wealthiest.

[Shinrei]

Property as an investment hasn't been in reach in the same way as it is now. Wealthy people who could afford to and therefore bought into the bubble have lost a ton, and the properties they had to liquidate become available to the next investor at a reasonable price.

If you stayed out of the game because the prices were high (saving your money and preparing), this is the opportunity to snap up deals.

Same as in the stock market. Investment firms (wealthy corporate entities) had to liquidate shares which drove the prices down. Quality companies can be bought for cheap now. I can buy more shares than before, and if all the stock manages is to eventually get back to its price in 2007, I've already made a pile of cash.

If I was wealthy and bought Citigroup at $45, I lost a TON. (It's at $2 a share now). If I buy Citigroup now and it creaps back up to a measely $8 a share I've quadrupled my investment.

(Also in answer to your question, there was a story on NBC about how there has been a big drop in number of millionaires in the US. So the wealthy are certainly less wealthy. Warren Buffett didn't avoid the mess...)

[HoosierDaddy]

Yes, but TRUE wealth transfer would require that billionaires suddenly start dropping like flies. What do $50 million in losses mean to someone who has $2 billion. Secondly, it is the wealthiest themselves that are in prime-position to take advantage of the sudden property dip. I just direct you to the truly rich during the Great Depression when they were there own aristocracy minus the titles. They can AFFORD to sit and let their property regain its value... and do this with other property as well. They can afford to gambles MILLIONS on the market and stand to either lose a paltry sum of net-worth, while possibly reaping yet more billions.

Does the carefully positioned and scrupulous saver have an opportunity to build a fantastic financial future? Yes. I definitely agree. But true transfer of wealth? I just disagree. Warren lost, what, half his wealth? $25 billion? I doubt his lifestyle has changed one bit.

[Shinrei]

Does someone have to lose their wealth entirely for it to be a "transfer of wealth"? As a non-wealthy person, I care about the opportunities I now have. I don't care if some rich person is still rich or not.

[HoosierDaddy]

Shinrei no Shintai, on Mar 16 2009, 11:25 PM, said:

Does someone have to lose their wealth entirely for it to be a "transfer of wealth"? As a non-wealthy person, I care about the opportunities I now have. I don't care if some rich person is still rich or not.

Is this what you are saying: "I don't care about the top 3% who own 75% of the wealth. I'm talking about the next 7% that own 15% of the wealth and I don't care what happens to them..."?

That's what I'm seeing. The "wealth" you are talking about isn't really being lost. It is minimal sums, in essence, when compared with what others have, and so yes, I DO NOT consider that a true transfer of wealth.

[Shinrei]

Percentages and who has what has nothing to do with what I'm talking about. This economic shake up has some people poorer than they were. This is true regardless of whatever "relative wealth" they had. If I had 100 billion, and I now have 50 billion, I am poorer. This shakeup has also created some golden opportunities for those who are not wealthy to take advantage and secure a better retirement or whatever. If millions or billions of dollars leave the possession of some people and end up in the possession of other people who didn't have them before, how is this NOT transfer of wealth?

And if Warren Buffet lost 50% (I don't know if that's true or not), that's a LOT of wealth (billions of dollars), even if he remains a wealthy man in the aftermath.

Why would a billionaire have to become a dirtfarmer before it can be considered transfer of wealth?

[HoosierDaddy]

Shinrei no Shintai, on Mar 17 2009, 12:40 AM, said:

Percentages and who has what has nothing to do with what I'm talking about. This economic shake up has some people poorer than they were. This is true regardless of whatever "relative wealth" they had. If I had 100 billion, and I now have 50 billion, I am poorer. This shakeup has also created some golden opportunities for those who are not wealthy to take advantage and secure a better retirement or whatever. If millions or billions of dollars leave the possession of some people and end up in the possession of other people who didn't have them before, how is this NOT transfer of wealth?

And if Warren Buffet lost 50% (I don't know if that's true or not), that's a LOT of wealth (billions of dollars), even if he remains a wealthy man in the aftermath.

Why would a billionaire have to become a dirtfarmer before it can be considered transfer of wealth?

Billionaire's for the most part, wouldn't have to become dirt-farmers. My entire point is that while this situation does remain advantageous for those who are posed to strike, it remains advantageous for those who didn't have all of their funds tied up in the stock market. Real property prices will recover. We both recognize this. Truly wealthy people have no problems there. People who had all their money in the stock market have taken a major hit, and that is where the transfer will come from, if in fact it does. While there are those who are not wealthy, such as yourself, who have been posed to strike in just such a situation. The TRULY wealthy are even MORE posed to strike.

I just see it as the truly rich getting richer, while everybody else fights to be wealthy. Like I said, I agree with you that a person in this position is posed to make financial gains such that he/she rises above others. But, I disagree with the fact that you think the majority of this wealth will go to "new" owners. I believe they will stay amongst the ones who have had it for the longest time.

Edit: I guess, as a simple analogy, I think you are talking peanuts, while I'm talking palaces.

This post has been edited by HoosierDaddy: 17 March 2009 - 04:56 AM

[Shinrei]

Actually, I think we`re just looking at "wealth" differently. You`re defining wealth as people`s personal wealth or net-worth. I`m defining it as assets.

If person A has to liquidate assets 1,2 and 3 because of the economic snafu, and person B buys assets 1,2, and 3 because they are in a position to do so and make a profit, that is a transfer of wealth. It has nothing to do with the relative net-worth of person`s A or B.

It could be that person A is poorer than person B and had to sell their silver coin collection to make ends meet. Person B buys them as a commodity to try to make a profit on the price of silver going up. This wealth transfer happened from a poor person to a wealthy person, but it is still a transfer of wealth. Assets are wealth. The more assets you have, the more wealth you are likely to have.

However, the economic downturn has caused the major asset holders (the wealthy) to lose some of these assets, which makes the A and B transaction to be more likey to be A is rich and B is not. You wont hear me say that a wealthy person losing tons of assets is somehow worse off than a poor person who lost their ONLY asset (like their house). But that doesnt have anything to do with the point I`m trying to make. Nor do I deny that the wealthy person A will still have lots of opportunities to regain their wealth. A savvy investor has to weather the downtimes as well as enjoy the good. This is just a chance for new people to move up!

My point, ultimately (and agreeing with Frook once again!!!!!), is person B has more opportunities in this market than they did before the downturn.

[HoosierDaddy]

Okay, yeah these last two points have reconciled our viewpoints on the matter. Macro vs. Micro wealth gains amongst a populace. I definitely agree this is the best situation I've seen for those who have the ability to quickly turn a small sum into a much larger sum in the long run.

[frookenhauer]

you two would make a great couple!

Dammit i'm outa time and gotta get ready to work..will post later.

Haha! agreeing with me again Shin? You're starting to make a habit out of it