Real Foolish wrote:
Gold, lol !! Explain how gold by any measure is help you?
My coworker recently told me, "You can't eat gold, Josh." Then I reminded her about Goldschlager.
Real Foolish wrote:
Gold, lol !! Explain how gold by any measure is help you?
My coworker recently told me, "You can't eat gold, Josh." Then I reminded her about Goldschlager.
Flagpole, you are not an exper wrote:
Flagpole, anyone can quote Dave Ramsey. Nice try though...
1) I AM an expert.
2) There are a LOT of ideas I have that are different than Dave Ramsey's ideas. Here's the list of main things:
A) Dave says not to have credit cards. I think that's silly. I just booked a trip to the Grand Canyon and needed a rental car. The cheapest rental car place would ONLY take credit cards and explicitly said they would not accept debit cards. Perhaps I could call them and wire money ahead of time or something, but it's just too convenient NOT to have a credit card. I just pay it off each month, so no big deal. He said you feel the pain of a purchase more with cash. I don't. I feel the pain the same either way, and with the credit card I have extra insurance for some purchases and get a nice tidy description of what I've spent my money on each month.
B) He says not to borrow for college. I disagree. I wouldn't borrow a TON for college, but it's reasonable to borrow some money for college if that's needed.
C) Dave says NEVER any bonds in your portfolio...only stocks, even when you're retired. I disagree 100% on that.
D) Dave says never own individual stocks. I say there's a time to do that...when you're already putting 15% into 401k and Roth IRAs AND when you have a paid for house and no other debt. THEN you can buy individual stocks as long as you have at least 5, no more than 20% in any one sector, and you spend an hour per stock per week on research about that stock.
E) He's 100% against 30-year mortgages. I'm not. 15 is preferable if you can swing it, but it's not for everyone. Maybe there's a stay at home mom for 10 years, and you know that the smaller mortgage payment is better during that time and you don't want to lose 10 years of building equity and losing out on perhaps the houses getting too expensive. You can always accelerate the payments later if you want.
F) Dave says to EXPECT 12-14% return annually on stuff in mutual funds. I say that's POSSIBLE but definitely not to expect that. I like to be conservative and figure 7-8% as a range. Historically I have gotten just under 11% annually since I started investing.
G) Dave says never to enter into a business partnership with anyone. "The only ship that can't float is a 'partnership'". Well, I think you need to be VERY picky about business partners, but clearly the CAN and DO work out often. They can go bad too, but you just put things in place to handle potential bad things.
Anyway, I listen to a LOT of people and read a lot of things and I accept bits and pieces from what they say and have my own opinions about things too...definitely NOT just a Dave Ramsey clone. In fact, about him, he's mostly just preaching to the choir with me, because I had the attitude about being debt free before I even heard of him...but, like I said above, he and I differ a lot. Some of his militancy is because he once went bankrupt and has bad feelings about creditors he had to deal with. I've never had that ever.
How does it not?
Racehorse wrote:
Flagpole wrote:Umm...the economy tanked in 2009...and it has come back and is still getting stronger. Same would happen if it tanks again. Unless you are within 10 years of retirement, big deal.
How does that relate to my post?
Glen Beck and I will rule the world because we will own all the gold!
and this... wrote:
How much did you bet/lose? Let's see, just for starters we could go with BYD (the battery maker Berkshire Hathaway invested in), Ctrip.com, Bidu (in fact, the "google" of China... which you said doesn't exist), PetroChina, China Mobile (an actual telephone company - wow who knew China had THOSE??!!!).
Dumb*ss.
PetroChina is the only company you listed that I've ever heard of. But I don't recall ever driving up to my local PetroChina station to fill up my car. ICBC is the only other Chinese company that I've ever heard of, but it is not like they are known for their innovation in the banking industry. None of those companies are. Go type into your Bidu search engine Chinese innovation. I'm sure you will find cutting edge technology such as paper, gunpowder, and the compass.
My point is we still do most of our business with American companies, and we will continue to do so into the future because they know how to keep the competitive edge over the rest of the world and a shift in the trade balance will not greatly affect you. Rare earths might go up in price, but that will effect you budget by less than 1/10 of a percent. The notion that a stronger yuan could hurt Americans is just nonsense.
saving money for college is a waste. all it does is subsidize vast increases in administrative costs (read: salaries), which are the only part of university costs to rise in the past decade, and the colleges will take everything you save. if you save nothing, you might just get financial aid, but you will not be worse off unless you own your own home.
Public debt is the same as the national debt right? Current debt is $14.1T GDP, is $14.8T. That 95% not 60%. I'm pretty sure as a percentage the only time its been higher is durring WW2. Do you think we will be paid to rebuild the world in the next 60 years like we did after WW2? Even if we are paid for sometheing,do you think the politicians will use the money to pay down debt like after WW2?
TCB wrote:
All you people have tunnel vision. You look at one unfathomably large number and say that it will be the end of America, without even looking at the unfathomably large size of the economy. Public debt is at 60%, which is on par with other large countries like France, Germany, and your United Kingdom.
If you want to look at the big picture, then you also have to look at the emerging market, particularly China and the systemic troubles therein. The market capital of China's real estate market is what 30, 40 times GDP? This would make it much larger than Japan's bubble during the 80s and a 1000 times larger than the one in Dubai. It is also the largest importer of oil, and greatly subsidizes gas prices. It has held interest rates at near zero for a decade. Most of its state owned companies rely on low interest rates to continue to do business and wouldn't be able to build unused skyscraper if it didn't. China also has a much higher cost of borrowing than the US does. Soaring inflation has been met with it's central bank has been using RESERVE REQUIREMENTS to slow the economy. Our Fed uses a scalpel to operate, they use a sledge hammer. They had a stimulus twice as large as ours during the great recession.
$150 oil would cause their economy to collapse, resulting in commodity prices to collapse. Americans might have a couple tough months, but they will rebound quite quickly. China's bloated economy cannot sustain those types of prices.
Ah - someone noticed.
Yes, the projected gross federal debt of the USA will top $15 trillion this year, officially equalling the size of the entire U.S. economy.
And it’s not getting any smaller with the federal deficit spiking to $1.65 trillion in the current fiscal year, the largest dollar amount ever.
Clearly that debt will only increase and is projected to be about $21 trillion in 4 years time.
The greatest national default in history is only a matter of time.
Incidentally, talking of trillions as if they were just marginally larger than billions - how hard is it to spend a trillion dollars?
If you spent one dollar every second, you would have spent a million dollars in twelve days.
At that same rate, it would take you 32 years to spend a billion dollars.
But it would take you more than 31,000 years to spend a trillion dollars.
AM I CONFUSED wrote:
Public debt is the same as the national debt right? Current debt is $14.1T GDP, is $14.8T. That 95% not 60%. I'm pretty sure as a percentage the only time its been higher is durring WW2. Do you think we will be paid to rebuild the world in the next 60 years like we did after WW2? Even if we are paid for sometheing,do you think the politicians will use the money to pay down debt like after WW2?
You are confused. Public debt is not the same as GROSS debt. Gross debt gets reported more, but public debt is the number economists tend to use more. Gross debt counts social security and medicare taxes as borrowing money, not as revenue. We could have a debate on this, but it wouldn't make any difference to the topic at hand.
Learn something new every day. But does that mean that 35% of GDP is collected as SS and Medicare? I thought that was only like 15% of personal income including employer contributions (half from you, half from employer).
TCB wrote:
You are confused. Public debt is not the same as GROSS debt. Gross debt gets reported more, but public debt is the number economists tend to use more. Gross debt counts social security and medicare taxes as borrowing money, not as revenue. We could have a debate on this, but it wouldn't make any difference to the topic at hand.
The deficit is not equal to 90% of GDP! The deficit and debt are different. That 35% of the gross debt is just the money we have to pay to retirees over a period of many years. The problem with thinking about social security and medicare as debt is that it is not the same as a bond where there is an expiration date and a coupon, and that is why it is excluded from the rest of government debt that is in the form of bonds.
I'm a teacher in a low income school. As long as the Blacks and the Mexicans are popping out babies my job is safe.
TCB wrote:
PetroChina is the only company you listed that I've ever heard of. But I don't recall ever driving up to my local PetroChina station to fill up my car. ICBC is the only other Chinese company that I've ever heard of, but it is not like they are known for their innovation in the banking industry. None of those companies are. Go type into your Bidu search engine Chinese innovation. I'm sure you will find cutting edge technology such as paper, gunpowder, and the compass.
My point is we still do most of our business with American companies, and we will continue to do so into the future because they know how to keep the competitive edge over the rest of the world and a shift in the trade balance will not greatly affect you. Rare earths might go up in price, but that will effect you budget by less than 1/10 of a percent. The notion that a stronger yuan could hurt Americans is just nonsense.
Way to reinforce my assessment that you're a dumb*ss.
Haha, then you should have originally said "I haven't heard of any Chinese companies", not "I bet nobody on this board has..."
Anyway, if you want to educate yourself just a little on the topic of Chinese innovation you might ask yourself what one of the greatest investors of all time (Warren Buffett) sees in a Chinese battery maker that you don't see at all.
http://money.cnn.com/2009/04/13/technology/gunther_electric.fortune/By the way, Buffett is known for AVOIDING technology. So, this is compelling enough to him to break one of his long standing investing rules.
(China is just getting started. That doesn't mean that the U.S. is done, but don't kid yourself that there is no innovation and will be no innovation from China just because you haven't heard of it yet.)
As to your point about a stronger Yuan not hurting Americans. If the cost of many things that are currently made with cheap China labor goes up 30-50%, there will be plenty of Americans feeling it.
and this... wrote:
Way to reinforce my assessment that you're a dumb*ss.
Haha, then you should have originally said "I haven't heard of any Chinese companies", not "I bet nobody on this board has..."
Anyway, if you want to educate yourself just a little on the topic of Chinese innovation you might ask yourself what one of the greatest investors of all time (Warren Buffett) sees in a Chinese battery maker that you don't see at all.
http://money.cnn.com/2009/04/13/technology/gunther_electric.fortune/By the way, Buffett is known for AVOIDING technology. So, this is compelling enough to him to break one of his long standing investing rules.
(China is just getting started. That doesn't mean that the U.S. is done, but don't kid yourself that there is no innovation and will be no innovation from China just because you haven't heard of it yet.)
As to your point about a stronger Yuan not hurting Americans. If the cost of many things that are currently made with cheap China labor goes up 30-50%, there will be plenty of Americans feeling it.
I don't get what this as to do with anything. Of course China has some innovation, but it is nowhere near the scale of what the US is doing, especially as it relates to the American consumer. I'm guessing Buffet is betting more on the future success of batteries than on the future success of China.
Still, a yuan appreciation would mean that Americans would substitute spending on Chinese products with spending on America products (as well as Mexican and European and Indian and Vietnamese and Indonesian products). The appreciation would be slow enough that production could shift to those countries and you wouldn't even notice.
And back to my main point, China is on far less solid economic and political ground than the US. A severe shock in the price of oil or food would barely dent the American economy while it would devastate China. The Chinese spend much more of their income on food and energy than Americans do. If China's economy falls apart, the drop in demand would lower food and energy prices, as we saw during the recent recession. We would essentially see the recession in reverse, with emerging economies stagnating and developed economies rebounding quickly.
TCB wrote:
And back to my main point, China is on far less solid economic and political ground than the US. A severe shock in the price of oil or food would barely dent the American economy while it would devastate China. The Chinese spend much more of their income on food and energy than Americans do. If China's economy falls apart, the drop in demand would lower food and energy prices, as we saw during the recent recession. We would essentially see the recession in reverse, with emerging economies stagnating and developed economies rebounding quickly.
Now that I think about it, it would be possible for the US to generate inflation to drive up food and energy prices in order to crush the Chinese communist regime out of power (social unrest caused by an economic downturn). This is CERTAINLY not what is the intent or goal of US policy makers and the Fed would have to be printing much much more money than it is to do that, but it is a more likely accidental outcome than a US collapse would be. There would have to be some crazy secret conspiracy for this to happen, and I'm not so sure there is anyone in government who would have been smart enough to plan the whole thing out. If there was, they would have seen Egypt coming, and they didn't.
TCB wrote:
The deficit is not equal to 90% of GDP! The deficit and debt are different. That 35% of the gross debt is just the money we have to pay to retirees over a period of many years. The problem with thinking about social security and medicare as debt is that it is not the same as a bond where there is an expiration date and a coupon, and that is why it is excluded from the rest of government debt that is in the form of bonds.
Who said debt = deficit? I missed that post. You said the debt figure reported as 95% was including SS and Medicare, and that the real number was 60%. If that is true then SS and Medicare receipts = 35% of GDP. I was under the impression that I only payed about 10% of my income and my employer paid another 5 or 6% for these taxes. If this is the case and you are right about the overreporting then you are discounting 35% for a tax that is only 15-16%. Where does the other 20% come from?
AM I CONFUSED wrote:
Who said debt = deficit? I missed that post. You said the debt figure reported as 95% was including SS and Medicare, and that the real number was 60%. If that is true then SS and Medicare receipts = 35% of GDP. I was under the impression that I only payed about 10% of my income and my employer paid another 5 or 6% for these taxes. If this is the case and you are right about the overreporting then you are discounting 35% for a tax that is only 15-16%. Where does the other 20% come from?
The discrepancy between us is because of annual deficits versus total debt. The government owes the equivalent of 35% of GDP in entitlement payments. So each year that number grows by a little bit. But, America's debt does not all mature at the end of the year. It is over a series of years, and not at the same time. Likewise, America does not have to pay me back the money I have it for social security for several decades. That "35%" did not all accrue this year, it has built up over the entire life of the program.
It's a very stupid semantical thing that is really confusing because entitlements haven't added to the deficit yet. We have always collected more in social security taxes than we have paid out. It's just that what we have collected in social security taxes are considered liabilities because we have to pay them back in the future. It is just much better just to use the public debt number. I'm sorry I couldn't explain this any better, most people don't understand it either and that is why we use the larger number more often (and because its scarier).
TCB wrote:
AM I CONFUSED wrote:Who said debt = deficit? I missed that post. You said the debt figure reported as 95% was including SS and Medicare, and that the real number was 60%. If that is true then SS and Medicare receipts = 35% of GDP. I was under the impression that I only payed about 10% of my income and my employer paid another 5 or 6% for these taxes. If this is the case and you are right about the overreporting then you are discounting 35% for a tax that is only 15-16%. Where does the other 20% come from?
The discrepancy between us is because of annual deficits versus total debt. The government owes the equivalent of 35% of GDP in entitlement payments. So each year that number grows by a little bit. But, America's debt does not all mature at the end of the year. It is over a series of years, and not at the same time. Likewise, America does not have to pay me back the money I have it for social security for several decades. That "35%" did not all accrue this year, it has built up over the entire life of the program.
It's a very stupid semantical thing that is really confusing because entitlements haven't added to the deficit yet. We have always collected more in social security taxes than we have paid out. It's just that what we have collected in social security taxes are considered liabilities because we have to pay them back in the future. It is just much better just to use the public debt number. I'm sorry I couldn't explain this any better, most people don't understand it either and that is why we use the larger number more often (and because its scarier).
Ok I see, but then do those pending SS payment only represent current recipients. How do they project how long each person will draw? Do they tally what that person has paid in the past, or what they expect them to collect in the future? I could swear I just read that last year SS officially ran a deficit. Do you think that is a fluke, or has the program tipped?
Flagpole wrote:
How does it not?
Racehorse wrote:How does that relate to my post?
Some expert you are. **rolleyes***
I will prepare for the Thunderdome, for that will be the new law.