Investment and/or Personal Finance

[Eunos_Cosmo]

Personally, I've had that choice several times. I always pay off the debt if I can. Why? I find, just personally you understand, that I get a better, more restful and less worried state of sleep. I spend a third of my life sleeping, and I appreciate maximizing the pleasure and benefits of sleep. Now I doubt very much that many other people are going to see and do things the same way as I do. And that's okay. But for me, it's a settled issue.

You also probably held debt at a point in time (specifically the 70s!) in which interest rates were worth losing sleep over. My perspective is framed almost entirely post 2007 where interest rates have been so low that borrowing money feels like it's just free. I don't have a lot of debt, but I have some. I don't even think about it. My payments are set to automatic and it's completely out of mind.

 

[Dotini]

You also probably held debt at a point in time (specifically the 70s!) in which interest rates were worth losing sleep over. My perspective is framed almost entirely post 2007 where interest rates have been so low that borrowing money feels like it's just free. I don't have a lot of debt, but I have some. I don't even think about it. My payments are set to automatic and it's completely out of mind.

Haha! - the 70's - whew! Back then I was doing all my thinking with my gonads and muscles. Strictly renting while racing, mountain climbing and globe trotting. I settled down and bought a home in '86. I did it with $3k down payment on a $64k note, and I refi'd a couple of times to finance home improvements and karting. But over the decades working at Boeing, I became more and more financially conservative and risk averse. I think that might come naturally with maturity.

 

[Danoff]

Haha! - the 70's - whew! Back then I was doing all my thinking with my gonads and muscles. Strictly renting while racing, mountain climbing and globe trotting. I settled down and bought a home in '86. I did it with $3k down payment on a $64k note, and I refi'd a couple of times to finance home improvements and karting. But over the decades working at Boeing, I became more and more financially conservative and risk averse. I think that might come naturally with maturity.

The prime rate in '86 was 10%. The payment on a $64k note if you had a 30 year mortgage would have been $562/mo. If you held it for all 30 years, your final payment would have been 2016, where $562 is basically a car payment (not that that's a good idea).

At 10%, that would have been basically the first place to save money.

 

[FPV MIC]

The prime rate in '86 was 10%. The payment on a $64k note if you had a 30 year mortgage would have been $562/mo. If you held it for all 30 years, your final payment would have been 2016, where $562 is basically a car payment (not that that's a good idea).

At 10%, that would have been basically the first place to save money.

I don't know what it was like in The States but here (Au) there was a lull in interest rates in the mid 80's. Earlier it had been about 14% and by the end of the 80's it was up to 17%. It really sucked for those buying housing in that era, but was great if you had money in the bank. Could it have been the same or similar?

 

[Dotini]

The crash is coming, according to Marxian economics. The consensus seems to think it may be coming in "November".

 

[VolkswagenX]

I mentioned the rich man/poor man bit by Adam Carolla in another thread just now, and it dawned on me that this topic has been bothering me recently. Don't get me wrong, I love that rich people end up having characteristics in common with poor people. I just started to realize that as wealth goes up financial moves of rich people start to look a bit more like the financial moves of poor people. It has caused me to instinctively resist certain decisions.

For example, I'm refinancing my mortgage right now. Now I could pay it off, that wouldn't be a big deal. But I want to use the money that I'd use to pay it off, and with an interest rate in the 2s, I'm taking out a loan that won't be fully repaid until I'm 70 years old. And I'm perfectly fine with that. I'd not be paying a dime of it early either.

But this move, to maintain debt, and even extend it beyond my working years, really strikes me as a rich man/poor man thing to do. I can make the financial case for it all day long and still instinctively recoil at is as something my parents would have done. And that's a very bad thing to say about anything financial. I personally know others who are suffering from this exact problem. I know a guy who paid off his new car loan early, even though it was at 1% interest. It's almost impossible to make a financial case for doing that, but he just hated having the monthly payment. It's a financial rich man/poor man comparison that makes people squeamish.

As someone who hit rock bottom because of the dumb mistakes I made in the past, I promised my self to be debt free as quickly as I can.
I know have a mortage and a loan with my wife's mother.

We bought our house in 2017 with a mortage that has to be paid of in 30 years. I made a plan to be mortage free in 15 years of less (aiming for 12 years). This sounds like a stupid plan to a lot of people but it doesn't really hurt me that much financially. My plan is based on the income I had in 2017 which has already increased by 25% in 2020. Another thing that helps is that we got a very good deal on our house. Even with my 2017 income I was able to save/invest 30% of my income and our family (wife and 2 kids) can still have a good life. The loan was a € 10k investment in the house that would quickly pay itself back and we are 2 months away from paying of that loan.

It really is a personal thing for me. I spend my years from 18 to 27 (35 now) living like a rockstar (without the rockstar income). I owned nothing because everyting I bought was on credit. And it was no problem for a long time because I could make the monthly payments.. Until I lost my job and got very depressed. Things will can turn really bad when you have no job and zero € to your name.. I finally got my self back on my feet, worked hard to get out of that situation and promised myself to never go back to a similar situation.

Sorry for the rant.

 

[Dotini]

Gold and silver appear to be spiking.






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[Eunos_Cosmo]

Somebody managed to get a fraudulent press release regarding a buyout of an oil & gas company (that was about declare bankrupt) published, I'm guessing to deliberately get robinhood traders jumping on the stock and make a quick buck. I have a feeling this is going to become more and more common...

 

[mustafur]

Gold and silver appear to be spiking.






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I put half of my savings into Silver when it was almost half that price, now its looking good, but I still expect it to grow alot more.

 

[Dotini]

I put half of my savings into Silver when it was almost half that price, now its looking good, but I still expect it to grow alot more.

I bought 54 lbs of silver when the price was 1/6th the price it is today. I will not sell it. But we have to remember this metal has a history of wild swings.

 

[Dotini]

Here, my favorite socialist economist explains how every economic system from feudalism to slavery to capitalism comes to an end. He is certain capitalism has a fatal problems but hesitant to predict the timing of sweeping changes coming in the US. Think "November".

 

[Biggles]

Sobering results of a Reuters Poll of economists on the subject of U.S. economy growth and unemployment outlook.

... a majority either downgraded or left their forecasts unchanged from last month, with the magnitude on average of those downgrades much bigger than the upgrades, disputing the “V”-shaped recovery expected by financial markets.

Asked for the worst-case scenario for the world’s largest economy, the median response was for a 40.4% contraction in Q2, no growth in the following two quarters, a 9.0% contraction in 2020 and no growth in 2021.

 

[Eunos_Cosmo]

Well I finally decided to buy Ford stock. With their investments in Rivian, the electric F150, the Mach-E (not sure that's gonna be a success but it's something), and the addition of the Bronco to their portfolio of cheap volume models that have a lot of price scale (IE: you can option them up to be very expensive!) and potentially strong enthusiast following...the price of the stock just seems like it has a lot of room to grow. I bought around $6.80. While my investment was modest ($500) and very small compared to my more diversified funds...I'd like to see where my automotive intuition takes me. . I bought fully accepting that I might just lose that $500. I keep reading these very bearish articles about how Ford stock will go to zero. As long as Ford makes the F150 and the Mustang...I just cannot see that happening.

The other one I have my eye on is Nissan...but I'm less sure that they have any mojo. I'm gonna wait to see how the Frontier is received, but I doubt it will trouble the establishment.

Looks like wall street is pleased with Ford's Q2 earnings...their stock jumped ~5% after hours at the time of me writing this. I still think Ford stock could be worth upwards of $50 a share if things go right for them.

 

[Danoff]

I put in an offer on a house last weekend. I was one of a dozen offers, bid way over asking, didn't get it.

Some markets are super hot right now.

 

[Biggles]

I put in an offer on a house last weekend. I was one of a dozen offers, bid way over asking, didn't get it.

Some markets are super hot right now.

There seems to have been a fair amount of commentary about how the pandemic will cause a flight from the big cities to the suburbs & exurbs. I'm pretty sceptical about this. I think eventually the pandemic will brought under control & life will go back, more or less, to the way it was. Growing cities - like Denver & Toronto - will continue to be desirable places to live & work & real estate prices will continue to rise.

I live in an exurb that is a popular place for retirement & recreation. In the last couple of months home sales - after being non-existent during the lockdown months - have exploded. Practically every house on the market has sold, including 3 - 4 million dollar properties that had been sitting for a while. This suggest to me that there is a strong demand for areas like this, but it's still likely to be limited to older people who are at or near retirement age. I think people in that category may have been motivated by the present situation to make a move they might have been considering anyway.

 

[Danoff]

There seems to have been a fair amount of commentary about how the pandemic will cause a flight from the big cities to the suburbs & exurbs. I'm pretty sceptical about this. I think eventually the pandemic will brought under control & life will go back, more or less, to the way it was. Growing cities - like Denver & Toronto - will continue to be desirable places to live & work & real estate prices will continue to rise.

I live in an exurb that is a popular place for retirement & recreation. In the last couple of months home sales - after being non-existent during the lockdown months - have exploded. Practically every house on the market has sold, including 3 - 4 million dollar properties that had been sitting for a while. This suggest to me that there is a strong demand for areas like this, but it's still likely to be limited to older people who are at or near retirement age. I think people in that category may have been motivated by the present situation to make a move they might have been considering anyway.

Yea, I was looking in a resort town where you might find some retirees. I thought we'd get it based on being far over asking. But man... a dozen offers... I couldn't have imagined how high people would bid.

Cheap mortgages are really driving prices way up too.

 

[ROAD_DOGG33J]

Per Zillow, people are viewing urban listings at about the same rate/proportion as last year. This is what they said for the month of June:

Suburban home listings are not seeing any more attention on Zillow than they were last year, relative to urban or rural listings. Suburban homes made up 62.2% of all Zillow page views of for-sale listings in June 2020, down just slightly from 62.6% in June 2019. Urban and rural page views each climbed 0.2 percentage points from last year.

https://www.zillow.com/research/2020-urb-suburb-market-report-27712/