Cash alternatives

Discussion in 'Business, Investing & Finance' started by Concrete Helmet, Feb 7, 2021.

  1. Concrete Helmet

    Concrete Helmet Hook, Line, and Sinker
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    So it looks like Biden's Big Top will put a stall on housing and stock market crashes for the next 6-12 months with the whopper stimulus that most of us know will be nothing more than a band aid. I think quite few on here have been holding back a wad of cabbage awaiting the utter destruction. Anyone plan on changing direction or allotment with their cash in the mean time?
    Recently I've upped my metal supply as I think that silver and such are sure bets. I'm also strongly considering paying off rentals and letting the monthly rents pay me back interest free(I could always reborrow if I want the cash back out and likely at a lower rate) I think 5-10% Crypto is pretty safe as long as you grab profits here and there along the way. Have a great idea for a low cost start up but not sure if I have the time or space...

    What are you guys doing in these 0% interest times with your cash while you wait?
     
    • g8r.tom

      g8r.tom Well-Known Member
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      • UFHealthGator

        UFHealthGator Well-Known Member
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        I decided to tilt 5% of my portfolio into Crypto. 90% bitcoin and 10% ethereum. I fully expect it will lose half of its value or more at any moment, but 10 years down the line I think it will prevail over the endless printing of fiat. 1BTC I own will forever be 1BTC out of a maximum of 21 million. (In reality much less than that because of lost coins and millions remain to be mined until 2140).

        I am very cautious typically when it comes to investing. I just keep it simple with Vanguard index funds, and a small real estate short term rental / airbnb. I never pick any stocks. So going into crypto took a lot of reading and evaluation of risk and reward. At 5%, I am willing to take the downside and upside.

        I had the cash sitting and doing nothing, and I'll be fine if it goes to zero. But the way I look at it, is if Bitcoin fails, that means the USD and fiat has been doing great, and my other 95% portfolio is thriving.
         
        #3 UFHealthGator, Feb 7, 2021
        Last edited: Feb 10, 2021
        • 78

          78 Dazed and Confused
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          I’m a big fan of low-cost index funds, esp ETFs, but this is not a market for them. It’s a market of hot pockets and staying on top of the rotations into them. That calls for disciplined moves in and out of individual stocks.

          With the vaccine being rolled out, the Fed committed to an accommodative monetary policy and the Biden admin pushing for more and larger stimulus programs, including an expansive infrastructure bill, it’s no time to be contemplating a market crash.

          There will be occasional pullbacks to consolidate prices, but the trend line remains upward. Tech earnings are rock solid and many of the beat up areas of the market stand to improve with the rollout.

          Housing? It’s been red hot for some time, aided by ultra-low mortgage rates. It’s probably time for a breather but I see no crash brewing there either. It’s structurally sound.
           
          • Concrete Helmet

            Concrete Helmet Hook, Line, and Sinker
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            Pretty good way of looking at it IMO. I too tend to do much better letting index funds do their thing as my ability to pick individual stocks is hit and miss at best. My feelings on precious/industrial metals are much the same as yours on crypto but I have closer to 20% there and don't care in they fall because in the long run 5-10 years I believe they will be worth 5X(copper, platinum, silver) with the exception of gold which may be lower.
            I do see crypto as more of a profit grab though because some governments are already warning people to be aware of buying and using....and we all know what happens when governments get involved. It's volitility can also cause major havoc with profit margins of businesses accepting it in exchange for stable priced items everyday retail items....If I sell you a car on Monday for 1 bitcoin and Tuesday it drops from 40k to 32k my books are f vcked....
            One can never go wrong with RE if in it for the long haul especially if it's free and clear.
             
          • UFHealthGator

            UFHealthGator Well-Known Member
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            I am all for a massive infrastructure spending bill. That is something we can all get behind and I think would get good bipartisan support. I am extremely weary of all other forms of money printing. The worst offense is when the federal reserve decided to buy junk corporate bonds. That is absolutely nuts and unhealthy for a capitalist market. If capitalism cannot punish losers, and there is no serious risk involved then we will pay the price eventually. It seems this money printing is also a bipartisan mistake. It happens under Republicans and Democrats.

            25% of ALL USD printed / minted in history was printed in 2020.... food for thought. Currently the velocity of money is low and the world is printing money too, so the DXY suffered for a bit and will recover and inflation is holding steady. But once the velocity of money increases again inflation is going to be through the roof.

            Cash is dead.
             
            #6 UFHealthGator, Feb 8, 2021
            Last edited: Feb 8, 2021
            • UFHealthGator

              UFHealthGator Well-Known Member
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              You are right that it seems bitcoin currently as a currency is not being used that way due to volatility. I look at it as a digital asset class that I can use as a hedge against our monetary policy. This is how it is being utilized. Interestingly Tesla just announced that they have bought $1.5 billion in Bitcoin in their treasury, and expectedly, Bitcoin just blew past its all time high. More importantly they will accept bitcoin as payment. I think the dominos will start falling soon.

              Don't get me wrong, it will remain very volatile, but the decade long trend seems to be heading upwards at an exponential rate.

              As far as governments, China, one of the most authoritarian governments out there tried very hard to ban mining and trading of bitcoin, and failed miserably. Now they are on the band wagon. Governments can certainly tax it but banning it is near impossible due to the decentralized state of the network.
               
            • 78

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              No one WANTS to print money but there are instances where it’s essential to maintaining economic stability. This was one of those instances.

              The inflation concern gets voiced a lot, going back years to the aftermath of the Great Recession. It never did get traction. It’s going to take a global recovery that’s considerably stronger than the one forecasted. With the rollout taking as long as it is, esp in the US, I don’t see it happening.

              I personally hope DXY remains weak. That’s market friendly.
               
            • Concrete Helmet

              Concrete Helmet Hook, Line, and Sinker
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              This X 1,000. While I'm in general agreement with some directed form of stimulus this is too much at one time....why are working people getting checks? Yet velocity has remained slow so far and if this picks it up too fast were f vcked.
               
            • Concrete Helmet

              Concrete Helmet Hook, Line, and Sinker
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              Yes but why not do it at a slower rate, more directed and staggered over time? I will be getting my 3rd check from our government....don't tell anyone but I'm working and our business just broke a record for the 4th year in a row....and my earnings are at an all time high. :crazy:
               
            • Bernardo de la Paz

              Bernardo de la Paz If you aren't a gator you are gator bait
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              How are you keeping that income out of AGI such that you get a stimulus check?
               
            • Concrete Helmet

              Concrete Helmet Hook, Line, and Sinker
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              Where there's a will there's a way...good accountant, sh!t ton of write off's, creative relationship and being a single Dad that claims his child with a side hustle that loses money all help...;)
               
            • FireFoley

              FireFoley Senior Member
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              @Concrete Helmet, I think you have it bass ackwards. Didn't they tell you that all those homo's that you are blowin' along the I-4 Corridor are supposed to be paying you, not you paying them for the privilege. :lmao2:
               
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              • Detroitgator

                Detroitgator Well-Known Member
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                i better see some 1099-MISC's or i'm turning someone in! it's the new American way!
                 
                • 78

                  78 Dazed and Confused
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                  Don’t tell me. You’re not legally married.

                  Re stimulus logic, no, not everyone should get a check. It should only go to the unemployed. But the rapidity of payments is a different story given the delay of several months since the last one. They’re making up for lost time.
                   
                • Concrete Helmet

                  Concrete Helmet Hook, Line, and Sinker
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                  Look I'm hard headed but I never fall for the same trick 3 times...it works both ways on this boulevard..
                   
                  #16 Concrete Helmet, Feb 8, 2021
                  Last edited: Feb 8, 2021
                  • Concrete Helmet

                    Concrete Helmet Hook, Line, and Sinker
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                    I'm wondering if some on here know the true value of rental properties in this age of eviction moratoriums....
                     
                  • BMF

                    BMF Bad Mother....
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                    I'd like to hear some horror stories from landlords. This "eviction" moratorium is complete bullsh*t if the government isn't protecting landlords as well. But the left deems landlords as "evil" because they're presumed to be "rich" since they own rental property. The reality is most 'landlords' probably own no more than one or two properties.
                     
                  • BMF

                    BMF Bad Mother....
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                    CH - I've got over $80K in streetshares earning 5%. It's been a great investment for me. They're in the process of being bought out, which will net me another small windfall since I bought some angel shares almost two years ago. If they were allowing more investment into the bonds I'd dump another $100k in there. I have $101k in a "high interest" savings at PenFed earning .6% (which kills me), but this is my "safe" money. I also stuck $5k into that company I posted a thread about, Blockfi - it's earning 8.6% and they pay interest daily (then dump it into your account at the end of the month). When (or if) bitcoin dips I'm going to start using Blockfi to buy bitcoin.
                     
                    • Concrete Helmet

                      Concrete Helmet Hook, Line, and Sinker
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                      I got lucky last June when a deadbeat mom stiffed me on Junes rent(she was 2 weeks late in May also)and moved out on her own over the 4th of July. I pulled the 24 hour inspection notice on her the friday before that weekend and told her I was showing it to a new tenant(bluff) and to have it clean....
                      She left half of her sh!t all over the front yard including rotten food and an old piano...our local resident bears must have smell the food inside the garbage bags and went haywire....sh!t was everywhere...but at least she was outta there. What a f vckin pig...it took my cleaning and repair person (my side hustle) nearly 2 months to get the place back together, painted, drywall & baseboard repair.
                      Finally finished up in September and rented in out in less than 30 minutes after hitting Zillow....turns out my new tenant works for my close friend in his pest control business. No pets and live with their working Dad so I've got 3 working adults in the house...worked out pretty good...
                      My other rental has had the same tenant for close to 4 years now. Take great care of the place and always pay before the 3rd or 4th. I don't know why he doesn't buy a house of his own since he owns/operates his own over the road truck and makes around 80-90K a year.
                       

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