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When people think about investments, they mostly think about stocks and bonds—this is usually because these are the most common assets types held by individuals. Just because these are the most common investments doesn’t necessarily mean they are the best in all market environments. There are many other asset types that you should consider when you’re allocating your investment capital.
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The reason we invest in anything is that we believe we can increase our savings. For many years, investors have been told that the key to riches is to buy low and sell high. I believe that is foolish advice, and I’m here to put in my two cents.
The main problem is that it lowers the overall return on investment, and as a result, reduces certainty more.
Recently, I have seen many articles stating that the stock market will drop by 5%-20% by the end of the year. Despite these many predictions by pundits, analysts, and economists, no one knows the market’s future direction—even if they guessed right previously. I can say this with certainty because the world doesn’t have a trillionaire.
For those who watch the news, you’ll hear the term Quantitative Easing (QE) thrown around now and then when they talk about the central bank’s monetary policy.
One of the most significant issues caused by a recession is illiquidity and the drying up of credit. In 2008, the central bank started experimenting with ways to create liquidity without creating significant inflation—their solution is Quantitative Easing (QE).
Warren Buffett is one of the most prolific investors of our time. Not only does he attain above-average returns, but he also dispenses wisdom to anyone willing to listen. One of my favorite pieces of advice that he has given is to “Read 500 pages every day. That’s how knowledge works. It builds up, like compound interest.”
But who wants to spend their afternoon reading about economics and personal finance?
In my previous report, I said that I believed the Fed “will not touch interest rates for the foreseeable future, which means that 2021 will likely be a year of higher-than-usual inflation.”
Since that report, the Fed has made some announcements which make me think that my previous statement will be the understatement of the year!
Imagine working your tail off to earn a bunch of money that is just sitting there in a bank account earning nothing. It sounds like a bad investment, but it is some of the best financial advice I can give, and it is called an emergency fund.
There is wisdom in an emergency fund, and everyone should have one.
There are many novice investors jumping into the markets right now. And why not? Almost all investment classes have been jumping in value over the past several years. In the next few years, you’re going to see market corrections and shifts away from meme stocks—that’s when you’ll see the difference between novice and savvy investors.
The housing market is on fire which is bad news for new home buyers! Houses in good neighborhoods are selling over list price within mere hours of being listed. A major culprit of this market craziness is the government moratoriums on foreclosures and evictions—this has frozen real estate markets which has left homebuyers and investors scrambling for the scraps.
Cryptocurrency is on the lips of many pundits today. While most people don’t like to admit it, crypto is not commonly understood.
That is because cryptocurrencies are built on two concepts that people use interchangeably: (1) a blockchain and (2) a token.
Are you interested on learning more about specific topics regarding your business? Click on the links below to learn more!