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Why Don't You Invest Your Cash ?

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i am sick of the number of times i have been accused of doing 'nothing' with my savings. most of my wealth exists as cash in high interest savings accounts. that is a big investment decision in itself and i certainly cannot be accused of being risk averse. i am additionally very short property

either wage INFLATION will converge with house prices thus increasing affordability at these levels and making a mockery of most people on this board including me OR asset price DEFLATION will double perhaps even treble my wealth overnight.

risk averse ? i dont think so.....

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either wage INFLATION will converge with house prices thus increasing affordability at these levels and making a mockery of most people on this board

I only believe that there will be a correction in the 'average salary:average house price' ratio. Not, necessarily, that house prices will crash... though I think that's more likely than the wage inflation that's needed to reduce the ratio to the 'avg house price = 3 times avg salary' that has, in the past, been the trough before the next boom.

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I only believe that there will be a correction in the 'average salary:average house price' ratio. Not, necessarily, that house prices will crash... though I think that's more likely than the wage inflation that's needed to reduce the ratio to the 'avg house price = 3 times avg salary' that has, in the past, been the trough before the next boom.

There is one problem with this BB.

Lets say prices dont fall, but wages rise to meet prices.

As Spline says on another thread, prices have risen roughly 25% since 2003.

So wages must increase at a similar rate. But if they do it will encourage many companies to outsource abroad.

The unfortunate solution is that in order to remain competitive UK Plc cannot increase wages or inflation and therefore the best solution is a HPC.

I reckon that 10-20% would do the trick - it would be like a pay rise for the whole country!

(remember a 25% rise only requires a 20% fall to be back where it started!!!!)

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I am betting on "Stagflation", which for me is:

+ A rise in commodity prices, and in particular, gold,

+ A rise in interest rates, in response to higher inflation, and a fall in house prices

+ An Economic slowdown

THIS BET has already put me MILES ahead of those poor saps looking for returns in property.

At best they have been boring. And they are stuck in an illiquid asset, which will be hard to sell

if/when the property market becomes nasty.

IT WORKS for me. It surprise me that more are not onboard this train that i have been talking

about for almost two years here.

The property bulls think they are winners, but the real winners are in Gold mining shares

i have trades on betting on all those outcomes.

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i am sick of the number of times i have been accused of doing 'nothing' with my savings. most of my wealth exists as cash in high interest savings accounts. that is a big investment decision in itself and i certainly cannot be accused of being risk averse. i am additionally very short property

either wage INFLATION will converge with house prices thus increasing affordability at these levels and making a mockery of most people on this board including me OR asset price DEFLATION will double perhaps even treble my wealth overnight.

risk averse ? i dont think so.....

assett price deflation trebble wealth in your accounts?

Wage push inflation..

I believe that Mervin King has almost lost his voice SCREAMING about wage push inflation.

It hasn't happened yet.

Ifact if you use the old wage measures ..

Wages have dropped..

Export those technical jobs..

lol

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I am betting on "Stagflation", which for me is:

+ A rise in commodity prices, and in particular, gold,

+ A rise in interest rates, in response to higher inflation, and a fall in house prices

+ An Economic slowdown

THIS BET has already put me MILES ahead of those poor saps looking for returns in property.

At best they have been boring. And they are stuck in an illiquid asset, which will be hard to sell

if/when the property market becomes nasty.

IT WORKS for me. It surprise me that more are not onboard this train that i have been talking

about for almost two years here.

The property bulls think they are winners, but the real winners are in Gold mining shares

Yes, mining shares and physical precious metals works well for me also. The property bulls don't realize one very important point that you made above "stuck in an illiquid asset". Most of these BTL's have no idea what that means - but they're gonna find out.

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Guest muttley

I still believe the UK will experience falling interest rates and deflation.

Then again, we might see stagflation.

Either way, best not to be in debt.

Liquidity rules.

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I am betting on "Stagflation", which for me is:

+ A rise in commodity prices, and in particular, gold,

+ A rise in interest rates, in response to higher inflation, and a fall in house prices

+ An Economic slowdown

THIS BET has already put me MILES ahead of those poor saps looking for returns in property.

At best they have been boring. And they are stuck in an illiquid asset, which will be hard to sell

if/when the property market becomes nasty.

IT WORKS for me. It surprise me that more are not onboard this train that i have been talking

about for almost two years here.

The property bulls think they are winners, but the real winners are in Gold mining shares

Yes, a great place for your money if you are happy to support child labour in Africa, wish to actively support wars in Africa funded by gold and diamonds and if you are generally OK with miners earning less than $1 an hour whilst at the same time lowering their life expectancy by years due to the terrible conditions they have to work in.

Edited by Dubai Exile

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i am sick of the number of times i have been accused of doing 'nothing' with my savings. most of my wealth exists as cash in high interest savings accounts. that is a big investment decision in itself and i certainly cannot be accused of being risk averse. i am additionally very short property

either wage INFLATION will converge with house prices thus increasing affordability at these levels and making a mockery of most people on this board including me OR asset price DEFLATION will double perhaps even treble my wealth overnight.

risk averse ? i dont think so.....

How high is high interest?

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Yes, a great place for your money if you are happy to support child labour in Africa, wish to actively support wars in Africa funded by gold and diamonds and if you are generally OK with miners earning less than $1 an hour whilst at the same time lowering their life expectancy by years due to the terrible conditions they have to work in.

But without $1 an hour jobs they would surley starve to death.... so in a way you're helping them? or am I way off?

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either wage INFLATION will converge with house prices thus increasing affordability at these levels and making a mockery of most people on this board including me OR asset price DEFLATION will double perhaps even treble my wealth overnight.

Why would a correction due to wage inflation considerably over house price inflation make a mockery of "most people" on this board?

Billy Shears

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Why would a correction due to wage inflation considerably over house price inflation make a mockery of "most people" on this board?

Because it would destroy the value of savings and make big debts much easier to pay off... thereby making the people who borrowed 300k to buy a one-bed flat look almost sensible and preparing another generation for taking on vast loans in the next house bubble.

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Because it would destroy the value of savings and make big debts much easier to pay off... thereby making the people who borrowed 300k to buy a one-bed flat look almost sensible and preparing another generation for taking on vast loans in the next house bubble.

It may also influence some companies to offshore jobs and thus reducing jobs available in this country.

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IT WORKS for me. It surprise me that more are not onboard this train that i have been talking

about for almost two years here.

I'm with you too. Dumped cash for gold, brought a couple of kilos of physical gold @ $545 last month. Used BullionVault.com. Doing well so far. (used to bet on the price, but the contango in the futures market put me off). Might buy some more if the price drops to 560-570 again.

Very sold on the unsustainable expansion in the dollar money supply. The US has 8,000 tons of gold in reserves, which sounds like a lot, but would only pay for the $ trade deficit for about 8 weeks.

The Fed cannot go on printing funny money forever, and using it in exchange for goods (and indirectly military superiority over the world).

I'm also convinced they intend to bomb Iran. :ph34r: Perhaps with a 50% probability? - they unlikely to back down down, after all this hard talk.

As an aside, our tax regime seems very mean to me - if you get out of sterling to protect your wealth while the currency depreciates and then get back in, the taxman will be after you. It's not my fault we keep expanding the money supply! Why do I have to pay a capital gain penalty?

Edited by no accountant

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i am sick of the number of times i have been accused of doing 'nothing' with my savings. most of my wealth exists as cash in high interest savings accounts. that is a big investment decision in itself and i certainly cannot be accused of being risk averse. i am additionally very short property

either wage INFLATION will converge with house prices thus increasing affordability at these levels and making a mockery of most people on this board including me OR asset price DEFLATION will double perhaps even treble my wealth overnight.

risk averse ? i dont think so.....

That cash invested in Estonian property would have put on 50% in last 24 months, so about 5 x more than cash.

Standard Lifes new property fund increased over 20% since launch last Autumn.

Lady I know bought land in Perth Australia 2 years ago for £180000. Just had valued at £420000.

Equities have thrashed cash in last 2 years.

Venture Capital Trusts likewise.

Whilst we all should have some in cash, it is worth taking the time and trouble to explore other possibilities.

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Yes, a great place for your money if you are happy to support child labour in Africa, wish to actively support wars in Africa funded by gold and diamonds and if you are generally OK with miners earning less than $1 an hour whilst at the same time lowering their life expectancy by years due to the terrible conditions they have to work in.

There supposedly exist ethical mining companies. I do not know much about it as I am in the process of reading up on it at the moment. The two companies that I have seen mentioned as being more ethical are Rio Tinto and Stillwater.

frugalista

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  • 301 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%



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