Basic Math

[apaknad]

(and a little meditation)...preach it brother.

[bayview]

muldoon . . .

Thanks for the inspiration for the soul.

But,  I am just as concerned for familys physical well being.  Shelter, food, water, warmth, (safety). 

There isn't a secure place for our retirement money.  What if the economy completely falls apart?  Dollar is worthless, precious metal investments could be consfiscated, etc.  I'm "johnny-come-lately" for ammo.  The only thing it seems I can do is store food.
Until someone else wants it . . .

Won't I have egg on my face, when I have been saving for the last 20 years.  While my friends were buying their new cars and living in the big houses, taking the vacations, dining out.  Borrowing till they couldn't get anymore.  To find out in the end we all may have nothing.  Well, at least I don't have as far to fall . . .

Is this fear-mongering? . . . Like y2k.  Are the planes going to drop out of the skies. . . etc.

Articles like this aren't helping either.  A lot of doom and gloom.  The article states:  "The bad news is that you won't have a job, pension, annuity, Social Security, Medicare, Medicaid and, quite possibly, your life."  

http://market-ticker.org/archives/852-Whats-Dead-Short-Answer-All-Of-It.html

[apaknad]

bayview,

if you are starting from scratch w/little money then do the simple things(i have said this before so don't throw bricks at me, i've only had 14 hours sleep since tuesday.) put your change in a jar at the end of the day for savings. you'd be suprised how quickly it adds up and you won't miss it. by a cheap 12 gauge pump shotgun w/the money saved(mossberg 500/remington 870+ a little ammo(00 buck)) used is fine. buy food,wait for sales on canned goods(4/$1.00). don't worry about nutrition/balanced diet at this time, just stock up(spam lasts forever for meat). simple stuff. start container gardening(very simple and cheap/fun). my e-mail is available to anyone who might have more questions or feel embarassed for some reason to state something here on the forum. don't worry,God is in charge and if you go to the last page of The Book, we win.
  dan

[glenn kangiser]

No need for worries, bayview but preparation for whatever may happen is always a good idea.  As has been mentioned before  a .22 is a respectable gun and ammo is still pretty easy to find for it as well as still pretty cheap.

A few bags of wheat, beans and rice - potato flakes etc. are a good start.  We are building slowly adding more every couple of months. 

As Dan mentioned, start a bit at a time and you will feel better as it grows.

There is only about a 3 day stock at most modern "stores".  You should  build your own backup and not totally rely on them.

Nothing may ever happen but being ready if it does is a good choice.

[BobHHowell]

We have already spent over $1 trillion in Iraq without getting squat in return. 

The impact of 9/11 - besides killing a bunch of innocent people - also heavily impacted our economy and the world's economy.  There does seem to be some relation in the lack of another attack and the lack of state sponsored terrorism -- and the war.  Libya came clean as one example.

Going to work without a plane crashing into your office building or going shopping without a bomb going off is your return.  I like that return better than the one I am getting in my 401K right now -- thank you very much.

[MountainDon]

Going to work without a plane crashing into your office building or going shopping without a bomb going off is your return. 

Good point BobHHowell. It's difficult to imagine what waiting for the daily bus must be like in some parts of the world.


Of course, Conspiracy Theorists will tend to disagree with that statement.

[glenn kangiser]

No one has proven that our side didn't assist and allow it, and since they will not allow an honest investigation with all questions and inconsistencies accounted for, it doesn't look good for our government and their big business alliances. 

In fact, they immediately destroyed the evidence by immediately sending it to China to be melted down so it could not be properly analyzed.  Since when has that been standard operating procedure?

The fact that we have not been re-attacked could be because we sheepily fell for their lies and most supported their fascist causes.  They only needed to make fake Bin Laden tapes to keep us pissing in our own boots .

[Jens]

Invest in God...nuff said.

[Sassy]

Hey Stinky, I now have the official story of our financial crisis & the bailout.  My SIL sent me this...

Heidi is the proprietor of a bar in  Berlin .  In order to increase
sales, she decides to allow her loyal customers - most of whom are
unemployed alcoholics - to drink now but pay later.  She keeps track
of the drinks consumed on a ledger (thereby granting the customers
loans).

Word gets around and as a result increasing numbers of customers flood
into Heidi's bar.

Taking advantage of her customers' freedom from immediate payment
constraints, Heidi increases her prices for wine and beer, the
most-consumed beverages.  Her sales volume increases massively.

A young and dynamic customer service consultant at the local bank
recognizes these customer debts as valuable future assets and
increases Heidi's borrowing limit.

He sees no reason for undue concern since he has the debts of the
alcoholics as collateral.

At the bank's corporate headquarters, expert bankers transform these
customer assets into DRINKBONDS, ALKBONDS and PUKEBONDS.  These
securities are then traded on markets worldwide.  No one really
understands what these abbreviations mean and how the securities are
guaranteed.  Nevertheless, as their prices continuously climb, the
securities become top-selling items.

One day, although the prices are still climbing, a risk manager
(subsequently of course fired due his negativity) of the bank decides
that slowly the time has come to demand payment of the debts incurred
by the drinkers at Heidi's bar.

However they cannot pay back the debts.

Heidi cannot fulfill her loan obligations and claims bankruptcy.

DRINKBOND and ALKBOND drop in price by 95%.  PUKEBOND performs better,
stabilizing in price after dropping by 80%.

The suppliers of Heidi's bar, having granted her generous payment due
dates and having invested in the securities are faced with a new
situation.  Her wine supplier claims bankruptcy, her beer supplier is
taken over by a competitor.

The bank is saved by the Government following dramatic round-the-clock
consultations by leaders from the governing political parties.

The funds required for this purpose are obtained by a tax levied on
the non-drinkers.

Finally, an explanation we can all understand...

[bayview]

Thanks for all of your responses . . .

I understand the need for food, ammo, etc.  But, I have 20 years of savings I'm also worried about.  Where would the safest place be for investment?

[peternap]

I think a lot of people are avoiding the question for a reason BV. Personally, I am not savvy enough to give investment advice. In the current market, I'm not sure anyone is and I certainly don't want to be responsible for you losing money.

If I had to make a safe suggestion, it would be in a CD at a stable bank like BB&T. They have different corporate banks for different areas so you can split it up and stay under the FDIC limit.

Two problems with that.

1. It ties up your money for the CD period and as has already een said, cash is king and ready cash is better.

2. Even though FDIC got a bailout, it is a long way from safe.

[glenn kangiser]

With the criminals running things now - safety is not an assured thing.  As muldoon stated many times - if you have debt now then paying it off is one of the only for sure  safe places -- makes a lot of sense.  It won't be hanging over you as interest is increased as they just did to us on a credit card.  We are paying that down now.

Sassy has a 401K type federal gov. plan -- she is locked out of it as far as pulling it out and must watch it dwindle away.  That is not safe- fair or recommended.  She got what she could and put it on our property years back.  Flutterby was able to get hers and pay off their property and put in a well.  As muldoon says - investing in yourself is safe.   Don't expect the criminals to help you increase your savings.  If they can steal it, they will.  That's my take.

[WoodSprite]

With the criminals running things now - safety is not an assured thing.  As muldoon stated many times - if you have debt now then paying it off is one of the only for sure  safe places -- makes a lot of sense. 

Sassy has a 401K type federal gov. plan -- she is locked out of it as far as pulling it out and must watch it dwindle away.  That is not safe- fair or recommended.  She got what she could and put it on our property years back.  Flutterby was able to get hers and pay off their property and put in a well.  As muldoon says - investing in yourself is safe.   Don't expect the criminals to help you increase your savings.  If they can steal it, they will.  That's my take.

What he said. We sank my 403(b) into our land and infrastructure:  a well, well pump, driveway, septic system, and all the houseparts we could find on Craigslist over a couple of years.  Now we're debt free, poor as dirt, building a house as we can scrape the nickles together, and I have never felt so secure.

[glenn kangiser]

to the forum Woodsprite.  At least you have a sound plan.

[Jens]

I am curious if anyone's investments have ended up helping them, or if they were just stress traps.  Not sayin, just sayin...

[MountainDon]

We've been happier than some many. The real estate rental market has been good and we bought at good times.  Some other things have been less than spectacular, but still ahead of the average. 


Haven't seen you much in a while, welcome back.

[rwanders]

   Can't claim we are completely whole again but, our investments and IRAs have regained about 80% of our losses in 2008. It was definitely stressful but we gritted our teeth and resisted the impulse to sell! sell! sell! (at the bottom of course) and it has worked out well so far----could have easily gone the other way we realize.

We have no magic advice or secret information----just good diversification and most importantly---no debt to magnify the pressure to panic.  Don't know where the larger economy or the country in general is heading. Unfortunately we will have to go along for the ride and hope the destination is tolerable.

[peternap]

I am curious if anyone's investments have ended up helping them, or if they were just stress traps.  Not sayin, just sayin...

Yes, no and maybe Jens.

Yes, the long term investments give us a fairly good monthly income but because the cost of things has gone up so much...it doesn't go as far as it used to. I'm also constantly worried about the wisdom of leaving long term out there in such an unstable economy.

No, I'm not making as much in short term investments, especially the Stock market, because there still isn't a base. It's a guessing game.

Maybe, the stock market is developing a rhythm again. It's not because any sanity or basis has returned, but it is somewhat predictable. It's like watching the wind sock on a gusty day. Even though nothing is constant, you get to where you can guess when the next gust will be.

[rick91351]

Hey Jens great to see you back.....

The best thing we have done - that seen the biggest dividends - for anything we have ever done investment wise is get on a written budget, stick to it.

Then went cash only.  (We do have a debt card.)

Next we search high and low using Craigs list and word of mouth, and some in the stores for bargains.  I never did this before, if I needed something for the ranch or down here I just went and got it.  Now with the written budget thing going and not going into debt or seemingly more into debt at every turn for us life is a lot more fun and simple.  We know what we have to spend in each category and if the money is not there this month it waits.  Best thing is we are on longer loosing money out the tail end of the balance sheet in the form of interest paid.  Great investment when it all works together!!! 

Good example I have been looking at Craigs list for culvert pipe 48" X 16' to go in a creek for up at the ranch.  It was going to cost us like $700 or $800 new and shinny that we are just going to cover over with dirt and rock anyway.  I found it yesterday slightly used and dirty but in very good shape for $112.  I found a water tank for irrigating our orchard 1200 gallon for $250.  It was going to cost us $1000 plus freight new.

Seems the old saying watch the nickles and dimes and the dollars will take care of themselves is still true.

rlr

       

         

[Sassy]

Way to go, rick91351!  We've gotta do that - have a book by Dave Ramsey - have read part of it & also a book by Randy Alcorn titled The Treasure Principle  Alcorn looks more at where your heart it, therefore your priorities while Ramsey gives you the more hands on, method of budgeting.  Both good books - I stopped reading Ramsey to read Alcorn because  needed what Alcorn said 1st, if that makes sense 

Randy Alcorn has written a lot of great books.  Larry Burkett, also a great writer, wrote some very good books on finances & many other things. 

[muldoon]

hey jens,

I made money this year in the market, not as much as last year but enough to stay at it in my spare time.  I treat it as casino money tho, my real dollars have been out for quite some time.  I sunk most of them in productive assets and debt reduction.  Except for some buffer money (illness/jobloss protection) I have no real money to worry about anymore.  In my opinion that has been the biggest stress reliever. 

I went back to re-read this thread as I did not remember the context of the question.  Basically, this is from February this year, during the hellacious crash and just before the height of the freefall.  It was dreary days.  My thoughts at the time and my advice was to

1) reduce debt, especially revolving credit cards (that are now jacked to 29% for the most part, those refi at 0% days are gone).  Those who relied on the ability to roll debt over on continued cheap terms got hosed, and thats the case whether or not it was a credit card an ARM mortgage or a business loan. 

2) cash is king, and in many ways, it still is.  no matter what you read in the paper about the dollar - you can still purchase great assets at distressed prices because people need dollars. 

3) invest in yourself, education, energy efficency, etc.

--
I said that investing in those high yeild bonds by broken companies was a bad idea. 
And it was, the us government broke the rule of law and threw out bondholders claims on GM as preferred and senior preferred debt only get pennies on the dollar while they gave UAW 30% of the company.  Had you held those bonds you got squashed.  The net affect of killing the bond market is that private capital is gone.  The fed is the lender of last resort and the only lender now because no one can invest with any confidence that the criminals wont just seize it like it was Mexico or Venuezula or Russia. 
--

If I had to go back in time and edit that post I wouldn't change anything today.  I have followed roughly the same advice in my life this year and am happy with the returns from it.   overall my biggest investment this year has been time investment in family.  My biggest dollar investments has been to continue on the debt free path - the country land and city house mortgage now are all thats left.  I have no regrets on either of these investments at all.   

[Jens]

Thanks for the welcome back guys.  I have been checking up here and there, but busy with other stuff.  Wasn't able or motivated to do much on the house either, so didn't have anything to report.  Will be taking photos of new work on the house and posting them soon. 

Investments are something that only slightly interest me.  I say only slightly because I have never had the kind of income to have to think about investments, just never was there.  If there is an extra $10 in my pocket, I'd rather give it away.  I know that doesn't make long term sense, think about my kids, yadda yadda.  I despise money.  It is simply a means to an end for us.  If the extra were there, we would be buying land, paying this mortgage off the rest of the way, going solar.  Those will be the next steps, maybe not in that order. 

Like I said, was just wondering how the things worked out for everyone.  I know my friend Dino just kept buying guns and ammo.  Now he just has a lot of guns and ammo, but last I checked stores won't take that in exchange for tools and building supplies

[MountainDon]

I think you need to balance the guns and ammo with a lot of other stuff.

[Squirl]

Like I said, was just wondering how the things worked out for everyone.  I know my friend Dino just kept buying guns and ammo.  Now he just has a lot of guns and ammo, but last I checked stores won't take that in exchange for tools and building supplies

I took the maximum loan on my 401K when the market was at around 13,000.  I have been earning a steady tax free 5% interest on myself for the past year and a half.  I bought land with it and have enjoyed ever minute I get to spend there.  A great return.

[Sassy]

I've done that a couple times - figured I could use my money & pay myself interest & if everything falls apart, I still was able to use that money...