Desi Logic
December 28, 2012 Leave a comment
How Sad
December 27, 2012 7 Comments
This is a story I came across today and it saddened me terribly.I don’t hold with mortifying the flesh to amass a fortune.Money is meant to be used (spent).Just make sure that ‘one hundred percent of appreciated value is demanded for each coin spent.’Saving and investing are to increase ones ability to make more to spend more in the present and the future.A little delayed gratification is necessary but to punish oneself to hoard money is stupid.
A Gold Hoarder’s Legacy
Walter Samaszko Jr. was not a guy who wanted company. He covered the windows of his house in Carson City, Nev., with cardboard so the neighbors couldn’t see inside. He made the postman stick the mail through the slot in his garage rather than coming to the front door. He was so good at keeping people away that when he died of heart failure at age 69 in June, nobody noticed until his house began to smell. Someone called the sheriff’s department. A hazmat team removed Samaszko along with part of the floor he was stuck to. Read more of this post
Is Saving In Silver Better Than Saving In Gold ?
December 27, 2012 3 Comments
Silver is the poorer cousin of gold and shows more volatility.However it is also considered a precious metal.So how does it compare to gold as a savings/investment?Where would you be today if you had bought and held silver for the last three decades?Follow this link to your answer :Long Term Returns From Silver Vs SENSEX
So silver would have given you marginally better returns.However you would have had to stomach its greater volatility.And worrying for 30 years just doesn’t seem worthwhile.
Also like gold, silver returns adjusted for inflation are pretty underwhelming and gets beaten by equity returns by a big margin .And in times of negative real returns silver like gold shoots up in price.
How Well Would You Have Done if You Had All Your Savings In Gold?
December 27, 2012 3 Comments
Today financial planners and daily wage earners speak of ” investing” in gold.In fact,given the dream run of gold in the last decade,most people can’t see past gold.Never mind that between last Diwali and this one there was no substantial increase in the price of the metal and that there was a fall in price in between and then it struggled to rise for a while.
There is no denying that in the dark days after the stock crash of 2008 and the poor economy thereafter, gold provided good comfort for all of us who worried about our financial health.And the fact that gold price rose fantastically in uncertain times was the icing on the cake.
Also gold has helped us hedge against inflation.Here is the link to an older post.
Gold also does superbly well when the equity markets and debt markets are giving negative real returns.
So should you just have all your savings and investments in gold?Far from it!Aside from the wealth tax you might be forced to pay every year on an asset that will give no returns till it is sold, at which point it might attract capital gains tax,keeping your money in gold over the last three decades wouldn’t have given you stellar returns.Check out the chart here:Long Term Returns from Gold Vs SENSEX While gold keeps up with inflation,just buying and holding it for long is unlikely to make you rich any time soon.So be certain to enjoy the touch and feel and beauty of your gold.
So How Well Would You Have Done With FDs Only?
December 26, 2012 2 Comments
Every time the stock markets tank or or equity returns look less than appealing,there is a tendency to want to return to the stable and predictable FDs. Why lose capital on the stock market or risk one’s money for lower rates than FDs?Why not just invest in FD’s and avoid the hassles of investing in the stock market?
In fact,what would have happened to you if you invested exclusively in FDs over the last thirty years?Ever wondered about that?If so,this link will give you your answer:Long Term Returns From FDs
Of course by locking in the higher rates ,when they appear, for as long as possible, and taking care to avoid FDs when they trail inflation rates for prolonged periods, you will be able to do a little better.Also these rates are those of the nationalized banks.You could earn a bit more by opting for smaller private banks and scheduled co-operative banks.You would still enjoy the same deposit insurance.
However the ravages of inflation should give you a pause before you decide on an all FD approach. Equity at worse is a necessary evil.
wealthymatters 