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Old 11-07-2019, 07:32 PM
 
9,609 posts, read 4,219,703 times
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Quote:
Originally Posted by EDS_ View Post
I don't agree.

For example one of my son's friends leveraged his way through medical school. It's a long story but he'll finish his ER residency this next summer and then begin a job doing locum tenens work around Texas. His salary will be such that he will be able pay his debt to zero within about 6 or 8 months if he'd like.

I'll grant that debt is a problem for many. Much like life saving medicine the right amount really helps too much is a big problem.
Debt now being fiat is much easier for the rich to leverage. And that only aggravates wealth inequality, if one should worry about such things. Debt can now be successfully leveraged to overtake material productivity.
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Old 11-07-2019, 09:09 PM
 
2,007 posts, read 493,023 times
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Quote:
Originally Posted by ohio_peasant View Post



That's a pithy epigram, but does it hold? Gold is favored by some, as a leavening of a balanced investment portfolio. But look at its long-term history.

What is the long-term history of the value of the dollar?


I think I will take my chances with gold long-term versus any fiat currency long-term. Back in 1920 a 1-ounce $20 gold coin would buy you a cow. Today a 1-ounce gold coin will still buy you a cow, but what will $20 buy you?
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Old 11-07-2019, 09:14 PM
 
2,007 posts, read 493,023 times
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Quote:
Originally Posted by EDS_ View Post
I don't agree.

For example one of my son's friends leveraged his way through medical school. It's a long story but he'll finish his ER residency this next summer and then begin a job doing locum tenens work around Texas. His salary will be such that he will be able pay his debt to zero within about 6 or 8 months if he'd like.

I'll grant that debt is a problem for many. Much like life saving medicine the right amount really helps too much is a big problem.


When the debt bubble busts you will.

People just have a normalcy bias with record debt levels right now. That will all be changing soon enough. There is a reason people like Dalio are buying gold and not leveraging themselves with debt in this environment.
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Old 11-07-2019, 09:15 PM
 
9,609 posts, read 4,219,703 times
Reputation: 1870
Quote:
Originally Posted by heart84 View Post
What is the long-term history of the value of the dollar?


I think I will take my chances with gold long-term versus any fiat currency long-term. Back in 1920 a 1-ounce $20 gold coin would buy you a cow. Today a 1-ounce gold coin will still buy you a cow, but what will $20 buy you?
There is certainly room for saving in gold metal, but not many of us save USD's long term. Many of us do invest them however. Do your due diligence + some luck and that $20 invested since 1920 will be worth many more USD's today.
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Old 11-07-2019, 10:29 PM
 
27,287 posts, read 34,192,803 times
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Quote:
Originally Posted by heart84 View Post
What is the long-term history of the value of the dollar?


I think I will take my chances with gold long-term versus any fiat currency long-term. Back in 1920 a 1-ounce $20 gold coin would buy you a cow. Today a 1-ounce gold coin will still buy you a cow, but what will $20 buy you?
$20 will buy me dinner. A nice one.
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Old 11-07-2019, 11:18 PM
 
8,994 posts, read 9,640,938 times
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Quote:
Originally Posted by heart84 View Post
What is the long-term history of the value of the dollar?


I think I will take my chances with gold long-term versus any fiat currency long-term. Back in 1920 a 1-ounce $20 gold coin would buy you a cow. Today a 1-ounce gold coin will still buy you a cow, but what will $20 buy you?

That's only one side of the equation.
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Old 11-08-2019, 01:12 AM
 
Location: Myrtle Creek, Oregon
13,114 posts, read 13,164,756 times
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Quote:
Originally Posted by SWFL_Native View Post
clearly yes we are in the midst of another bubble yet we have not realized it. I'm just trying to figure out how to best capitalize the impending doom that is coming. how does one profit on the mass default of loans?
You profit on the desperation of people trying to raise cash by any means. In a crash, money talks. Look for bargains that are 50% to 90% off. You can even leverage yourself into bargains, like the short sales of real estate in the recovery from the last recession. Banks will take a loss if it means they can get it off their books.
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Old 11-08-2019, 10:00 AM
 
8,994 posts, read 9,640,938 times
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Quote:
Originally Posted by Hoonose View Post
Debt now being fiat is much easier for the rich to leverage. And that only aggravates wealth inequality, if one should worry about such things. Debt can now be successfully leveraged to overtake material productivity.
No sale. Those towards the bottom of the economic ladder would be worse off, far worse off under a metals standard. We have nearly 1,000 years of economic history under various metal standards from which to study. The takeaways are clear.

1. Persistent and very significant liquidity shortages.
2. Short term price instability.........mainly due to too few dollars in the system.
3. Artificially high unemployment. Friedman described it well as a deadweight loss.
4. Economic growth is severely truncated as monetary growth is tied to new discoveries of X-metal.

________________

As an aside countries that ditched or significantly moved away from gold standards fared much better than those that held on to gold standards before and during The Great Depression.

A couple points. Under a gold standard The US spent significantly more time in recession from 1900-1938, call it 38 years and three months than we have since 1938-2019, call it 81 years and a few months. Depending upon some dither in the data we spent between 48% and 55% of the former in recession and around ~8% since.

For context. The Colonies and then US from about 1755-1938 saw little but economic instability.

_______________

I'll let the master explain, wait until you have 8 or 10 mins. to watch the whole thing.

https://www.youtube.com/watch?v=Hik8bv6EnBI
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Old 11-08-2019, 11:10 AM
 
9,609 posts, read 4,219,703 times
Reputation: 1870
Quote:
Originally Posted by EDS_ View Post
No sale. Those towards the bottom of the economic ladder would be worse off, far worse off under a metals standard.
Agreed.

Although fiat debt might exaggerate the rich's gains, it is essential in providing supports and relief for our poor.
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Old 11-12-2019, 01:31 AM
 
Location: Las Vegas (Winchester)
449 posts, read 335,072 times
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The financial talking heads have been warning about the bubble in corporate debt. Investors hungry for yield are buying it packaged up in CLOs (collateralized loan obligations). If the economy turns down, a lot of companies will be forced to file BK because they cannot service or roll their debt. Their debt load is too high and rating agencies will downgrade their debt on reduced revenues.

This reminds me of the mortgage crisis. Their were a lot of people warning about it but few were listening. Is anyone paying attention now?

https://www.bloomberg.com/opinion/ar...n-most-realize
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