Jump to content
House Price Crash Forum
Sign in to follow this  
Panda

Savings, Pensions, Investments, Assets? Going?

Recommended Posts

To lose 50% of a House or Cash Value, whats the difference? If your house falls 50% in selling valuation or your cash pile loses 50% of its buying power, whats the difference, which would you prefer?

Pensions and Savings not looking good...

http://www.zerohedge.com/news/2013-04-11/carmen-reinhart-no-doubt-our-pensions-are-screwed

magne13

Hey Carmen, please tell me where you think inflation will come from? 120m Americans out of work, 48m on food stamps, 1.2T student loan debt, 11T mort debt, I can go on and on. Good luck with inflation when nobody has any money, velocity of money is zero and we have 80T in derivatives non net to dig us further into the theft of any future GDP earnings, so no inflation is not a threat, nor will it ever be in the near future, we have lived off of leverage and stolen so far into the future that there is no longer any near term GDP to steal from, thats why QE will be indefinite and inflation will be negative, Japan was the beginning of how excess gets purged and the entire globe will be under this weight for a long long time. I am not sure why we nobody can see how Japan is and was the pattern that we are all going to have to follow. The only way out is truly global war and destruction to reset the system, that is how it was, how it will always be and it is just a matter of time now

http://www.telegraph.co.uk/finance/personalfinance/pensions/9982261/Final-salary-pension-deficits-jump-by-35bn-in-a-month.html

Final salary pension deficits jump by £35bn in a month

Share this post


Link to post
Share on other sites

"Good luck with inflation when nobody has any money"

The central banks have infinite money and are prepared to use it. The question is "Will they correctly judge how much to use or will their political masters force them to cover endless deficit spending". My (devaluing) money is on the latter.

Share this post


Link to post
Share on other sites

"Good luck with inflation when nobody has any money"

The central banks have infinite money and are prepared to use it. The question is "Will they correctly judge how much to use or will their political masters force them to cover endless deficit spending". My (devaluing) money is on the latter.

Everyone's (devaluing) Wage is on the latter.

Share this post


Link to post
Share on other sites

To lose 50% of a House or Cash Value, whats the difference?

After the price of a given house falls 50%, the mortgagor still owns full amount outstanding.

After cash loses 50% of its purchase power (nominal value is still the same), the owner owns nothing except in case he is also a mortgagor :-)

If your house falls 50% in selling valuation or your cash pile loses 50% of its buying power, whats the difference, which would you prefer?

I personally prefer the latter since I could buy the 50%-depreciated house with 50% of nominal value of my cash pile.

Now, if we are getting into a discussion what happens after 50% of cash in the bank was confiscated a la Cyprus, then my decision would be different... B)

Edited by matroskin

Share this post


Link to post
Share on other sites

After the price of a given house falls 50%, the mortgagor still owns full amount outstanding.

After cash loses 50% of its purchase power (nominal value is still the same), the owner owns nothing except in case he is also a mortgagor :-)

I personally prefer the latter since I could buy the 50%-depreciated house with 50% of nominal value of my cash pile.

Now, if we are getting into a discussion what happens after 50% of cash in the bank was confiscated a la Cyprus, then my decision would be different... B)

If the house were owned outright, valued at 200k, you also could have 200k in cash, both fell, the house to 100k, over five years, your cash to the buying power of 100k of 5 years, roughly cost inflation running at 16% per annum over five years.....

Who would benefit the most the home owner or the cash owner, one has paper wealth, one has also paper wealth tied up in an asset albeit falling in value but removing the need to pay rent...

Share this post


Link to post
Share on other sites

If the house were owned outright, valued at 200k, you also could have 200k in cash, both fell, the house to 100k, over five years, your cash to the buying power of 100k of 5 years, roughly cost inflation running at 16% per annum over five years.....

The original question was "which one do you prefer", not "what hurts more if both fell together" :P

I don't think they can fall together (either cash purchasing power drops or house prices fall) so your 2nd question makes little sense to me - only as 100% theoretical scenario.

Who would benefit the most the home owner or the cash owner, one has paper wealth, one has also paper wealth tied up in an asset albeit falling in value but removing the need to pay rent...

The rent would fall as well, but not taxes - they probably will go up a lot %-wise, to feed the state/public sector.

And capital controls will be put in place but this would not stop capital flight.

So - all in all - cash owner will be better off since s/he could still escape abroad with most part of his/her money (allegedly, even now one could get out of Cyprus with 20% upfront fee) whereas home owner would be stuck with unsellable asset which eventually will drop in price to "replacement value".

IMHO :D

Edited by matroskin

Share this post


Link to post
Share on other sites

To lose 50% of a House or Cash Value, whats the difference? If your house falls 50% in selling valuation or your cash pile loses 50% of its buying power, whats the difference, which would you prefer?

Pensions and Savings not looking good...

http://www.zerohedge.com/news/2013-04-11/carmen-reinhart-no-doubt-our-pensions-are-screwed

magne13

Hey Carmen, please tell me where you think inflation will come from? 120m Americans out of work, 48m on food stamps, 1.2T student loan debt, 11T mort debt, I can go on and on. Good luck with inflation when nobody has any money, velocity of money is zero and we have 80T in derivatives non net to dig us further into the theft of any future GDP earnings, so no inflation is not a threat, nor will it ever be in the near future, we have lived off of leverage and stolen so far into the future that there is no longer any near term GDP to steal from, thats why QE will be indefinite and inflation will be negative, Japan was the beginning of how excess gets purged and the entire globe will be under this weight for a long long time. I am not sure why we nobody can see how Japan is and was the pattern that we are all going to have to follow. The only way out is truly global war and destruction to reset the system, that is how it was, how it will always be and it is just a matter of time now

http://www.telegraph.co.uk/finance/personalfinance/pensions/9982261/Final-salary-pension-deficits-jump-by-35bn-in-a-month.html

Final salary pension deficits jump by £35bn in a month

Housing is manipulated by currently politicians....how long can they maintain this?

Cash at bank is being ripped off by politicians and spiv bankers paying no interest

Pensions--and funds -ripped off by investment managers who perform worse than monkeys

Shares totally manipulated by politicians and inflated by qe..again how long can this last?

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 239 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.