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Old 11-18-2009, 02:13 AM
 
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the term only down on paper only counts if you arent using the savings yet .

if you are retiring tomorrow and need to know what you can live on ,well the fact that last year you had a million bucks and now you have 500,000 bucks because your down is very real.

your no different than any other person with 500,000.00 bucks as far as computing your withdrawls.

if you have a million dollars in investments and are retiring , based on your million bucks and your getting an average 7% return you can pull 40,000 from it.


if you are retiring the following year and markets are down 50% and all you have is 500,000 bucks , well all you have is 500,000 bucks so you can pull only 20,000.00

at different times of our lives the numbers represent different things because at times we are not using the invested money and are only letting it accumulate. those numbers become very real when you need to figure out just what your nest egg is for withdrawing money.

the term only down on paper only applys when your not using the money... markets have no memory.


think of your investments as if you are working on commission. each year your income is different . some years you have more income , some years less but overall you earn way more over long periods of time then you could working for a salary somewhere else even with those leaner years when business sucks.

Last edited by mathjak107; 11-18-2009 at 02:27 AM..
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Old 11-18-2009, 05:25 AM
 
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That sounds liie a wind speech for the money on paper is only money once in hand.Bascailly what I said.Investments are just that; not cash on hand.
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Old 11-18-2009, 05:38 AM
 
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depends for what purpose your counting.. like i said when i plug those final numbers in to see what i can start withdrawing first year in retirement its all based on that total amount at that moment, whether cash or not.....

the fact on paper it was worth a million last year and 500,000 today on paper means 500,000 is your base amount.... you would be a fool to withdraw based on if you still had a million bucks.

you no longer have a million dollars in your nest egg anymore then the guy retiring today with 500,000 in his nest egg who sets up his withdrawls like he had a million
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Old 11-18-2009, 12:34 PM
 
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Quote:
Originally Posted by mathjak107 View Post
could be good , could be bad... i never predict..... the companies that make up just the s&p 500 get 1/2 their income from sales abroad... weak doller good for them.. 1/3 . ... our bonds and debt become attractive to foreigners... they can get an extra nice boost if they catch their buys and sells right.
Why do you even bother? Why do you still try? Let them live their lives and enjoy your prosperity.
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Old 11-18-2009, 12:47 PM
 
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I do it for those that actually may get something out of it.....

i think of all the smart people who i learned from and the fact i would have never benefited from their knowledge if they didnt take the time to pass on what they learned.

i actually get nice comments and messages from people thanking me for the things they picked up and opened their eyes to.

that makes it worth my time.....
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Old 11-18-2009, 12:56 PM
 
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Originally Posted by Wingfoot View Post
What effect would/will a collapsing dollar have on all that?
the dollar isnt collapsing. we had an enourmous flight to quality during the last 2 years as central banks around the world fled to the dollar and treasuries.


we are now seeing the unwinding of this flight to quality as once again the world is putting money into riskier assets..

heres the thing the media didnt tell you..

foreign central banks have sold dollars, but they have been buying billions in TIPS ... they have been doing this to hedge against a drop in the dollar which may elevate inflation a little eventually. the TIPS act as a currency hedge.


eventually these tips will be sold for dollars and there will be all these central banks around the world convertiing back to dollars again. with rates around zero why would anyone want to store dollars when they can have tips and treasuries that at least have interest on them.
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Old 11-20-2009, 11:22 AM
 
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Quote:
Originally Posted by Wingfoot
What effect would/will a collapsing dollar have on all that?

Originally posted by mathjak:
the dollar isnt collapsing. we had an enourmous flight to quality during the last 2 years as central banks around the world fled to the dollar and treasuries.
mathjak, if you and others feel like investing the time please read this short scenario written by John Galt and then could you give us your opinion of the likelihood of this happening. I'm sure such a scenario is what's on wingfoot's, my and a lot of others' minds about the uncertainty of the dollar.

The Day the Dollar Died John Galt Dprogram.net
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Old 11-20-2009, 12:49 PM
 
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Quote:
Originally Posted by brightdoglover View Post
He also considered an adjustable mortgage "because I can always refinance later." Are people always doomed to repeat the same mistakes? Is it that people really want to believe there's a free lunch?
It is actually the people who buy fixed-rate mortgages over and over again throughout their lives that are the ones making the mistakes, not the people getting ARMs. Most mortgages are held for less than 7 years. It makes no sense whatsoever to pay a higher interest rate for the "security" of having it locked in for 30 years when you're not going to keep it for that period of time.

And, please, no anecdotes from people stating that they've lived in their houses forever. I'm talking most people, not any one person in particular.
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Old 11-20-2009, 01:12 PM
 
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excellent point , 5-7 years is the average before a families needs change , so they say. . another point is people pay all that interest sometimes too for decades ..they get to the point where they hardley pay any interest anymore and then they go refinance at a lower rate....they are hardley paying interest anymore but they put themselves back to square 1 again..

lots of amortization tables are front end loaded so you pay a lot more interest early on just because they know people do dumb things like the above.

Last edited by mathjak107; 11-20-2009 at 01:21 PM..
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Old 11-20-2009, 01:18 PM
 
71,798 posts, read 71,896,917 times
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Quote:
Originally Posted by thrillobyte View Post
mathjak, if you and others feel like investing the time please read this short scenario written by John Galt and then could you give us your opinion of the likelihood of this happening. I'm sure such a scenario is what's on wingfoot's, my and a lot of others' minds about the uncertainty of the dollar.

The Day the Dollar Died John Galt Dprogram.net
not being a chicken little i dont see things play out at all that way
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