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Old 08-17-2020, 10:31 AM   #61
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I don't think that USD will become obsolete any time soon but one cannot ignore all the unlimited printing that we are witnessing lately. We already see the inflationary results in equities' prices - it's not where one would normally look for the signs of inflation bit it's one of the more plausible explanations for the raising stock prices during severe economic downturn.

So I do hedge against the possible $ devaluation by investing in individual companies with solid balance sheets and good survival potential (in other words not in airlines or cruise lines lol), international funds and equities, cryptocurrencies and precious metals. Ah, also a few k's in teak farms. These are all semi-small amounts that I can afford to lose but if things go well (or terribly bad depending on the POV) they may pay off. I'm debating more real estate but that wouldn't be in US and with traveling on hold it may have to wait. Plus it's a pain to manage.
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Old 08-17-2020, 11:19 AM   #62
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Quote:
Originally Posted by RobbieB View Post
Nah, I don't worry about the dollar losing value.
Ditto. I really don't need that much and that will only continue as I grow older, have more of what I already need purchased or no longer need to purchase to remain happy.

Actually, to be happy, all I need is my paid for home, some groceries and enough to keep it heated and cooled. I'd easily get by on 50% of my current expenses, cutting down on gifting and charities alone. Another 10% or more to thrift shop for those items I require instead of spot buying at what ever market prices are at the moment. Quit buying new cars every 4 years, etc.

I'm pretty sure most who are FIRED have a lot of headroom in their budgets as well as I do. Rare and probably foolish, is the person who FIRE'd and didn't plan for a 50% haircut as at least a possibility before telling their boss to take this job and shove it. Ha!
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Old 08-17-2020, 01:10 PM   #63
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Right now I'm trying to hedge against everything - inflation, deflation, hyperinflation, anarchy, war with China...who knows what's coming next?

I just sold one rental property to build our cash reserves; and if the market goes down in 2021 we'll buy back in or maybe get a new place to escape. We have seven-figure holdings in rental real estate (w/no debt), and six figures in stocks, gold, and annuities in addition to the cash from the home sale (and five figures in guns and ammo for the anarchy option), so whatever happens we'll win some and lose some. My biggest concern is what life will look like for the next 5 years. The clock is ticking and we're not getting younger...

(FWIW, when we sold our rental last week, we received multiple above-market offers and accepted an offer within 5 days of listing - a first for me. RE supply is very low, so demand is very high. I think that will change as people lose their jobs - supply will definitely increase with the forced sales and foreclosures.)

I'm expecting a period of asset deflation in 2021 based on a reduction in consumer spending as people exhaust their savings. For the increased dollar supply to cause inflation would require a much higher money velocity than we see now. I don't see demand (pull) or supply (push) being inflationary either b/c of the excess capacity in our system. I do think certain basic necessities will become more expensive by a lot, but it will be offset by a reduction in other costs like rents, energy and wages.
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