The stock market thread Part II (The GME Phenomenom)

[QuietContrarian]

No not wrong at all. It's a great book and I've read it a couple of times. I agree with what you wrote i was just pointing out the TLDR summary of it.

I apologize, a little quick on the trigger there.

 

[Fixed to Ruin]

I apologize, a little quick on the trigger there.

I should have pointed out that i read the book before commenting on it. My bad.

 

[Hockey Outsider]

It sounds like you have a well-diversified portfolio with a mix of stable, dividend-yielding stocks and some speculative stocks - I have gone completely away from speculative stocks, but that is only because my passive income investments are generating a healthy monthly profit - Enough to live by, and save for retirement. Also has to be said, that I made a very large profit on my crypto sales.

You've found (Like me) that the dividend-yielding stocks have provided consistent returns over time, with less volatility compared to the overall market - It is crazy to me, that not everyone is doing this.

You, just like me, value the discipline imposed on companies through the requirement to pay dividends. Reinvesting those dividends to grow your holdings is a smart move.

Dividends are taxed at a lower rate in Canada, but it is doable in both the US; and Denmark where I reside.

Just to clarify - around 60% of my portfolio is in broad ETFs (tracking, say, the US market as a whole, or "developed" markets, or bonds, etc). The other 40% is in blue chip dividend stocks (all Canadian - to take advantage of the generous dividend tax credit we have in Canada). I sold the last of my truly speculative stocks 1-2 years ago (I had made money on it, but I don't recall if it exceeded the returns I would have earned from a general ETF - and even if it did return more, it wouldn't have been by much, and it surely wasn't worth all the headaches it created).

I still get tempted to buy speculative stocks now and then. I'm not saying I'd never try it again. But I work too hard to gamble away my money on speculative bets, so it would have to be a pretty compelling case.

 

[Hockey Outsider]

Let me expand a little:

Debt as an asset can be a complex concept, but it's crucial to understand it if you want to make the most of your investment strategy. Essentially, when used correctly, debt can be leveraged to increase returns. But it's important to remember that this strategy comes with risks as well.

It's also important to understand that debt is not always an asset. For instance, if you take out a loan to finance a personal purchase that does not generate any income, the debt is not an asset but a liability. The distinction between an asset and a liability lies in whether the debt generates a positive return for you or not.

When using debt as an asset, it's crucial to have a solid understanding of the investment, the interest rate environment, and your ability to service the debt. This way, you can make an informed decision and minimize the risks associated with this strategy.

In conclusion, debt as an asset can be a powerful tool, but it requires careful consideration and a sound understanding of the risks involved. Used correctly, it can help you achieve your investment goals and generate higher returns.

Hope I made it make sense - If not, the book I recommended to you, will do a better job.

Full disclosure - I never read the book, but I'm familiar with Kiyosaki's argument. I have mixed feelings.

For me, debt is debt. If you borrow money, and you need to pay it back (with or without interest), it's a liability. End of story.

Of course, debt can be useful. If it's used to buy a business (or a rental property, or a stock, or a university education), and you're confident that the return from that investment will exceed the cost of the debt, then it can be described as "good debt" or "smart debt". The problem with calling these loans an asset (aside from violating basic accounting principles) is it makes it far too easy to justify going into debt. Even psychologically, calling it a liability forces you to think more clearly about whether it's a smart thing to do.

With the benefit of hindsight, if I had used more leverage, I would have been in a better position today. I should have paid my mortgage slowly, and I should have used margin to invest (especially a few years ago when blue chip dividend stocks paid enough to cover the interest on an investment loan). But there's also a psychological component, and there's something to be said for having little (or no) debt hanging over your head.

 

[Scintillating10]

If China enters the war, what affect will it have on stock markets?

 

[The Crypto Guy]

If China enters the war, what affect will it have on stock markets?

Down down down.

 

[Play]

Down down down.

Putin speaking today?

 

[Scintillating10]

Down down down.

Energy stocks should go up? I think? I Industrial?

 

[The Crypto Guy]

Energy stocks should go up? I think? I Industrial?

If China enters the war all hell is going to break loose and you can count on WW3. The entire market will crash.

 

[Scintillating10]

If China enters the war all hell is going to break loose and you can count on WW3. The entire market will crash.

Way you said that doesn't matter where you have your money invested if China enters the war? Seen on news last night, USA issued warning to China not to help Russia. Plus those balloons last week

 

[Fogelhund]

ARKK, Renewables, lithium, BTC, and REITs are my holds.

Good times.

 

[McGarnagle]

Looks like we're crashing again

 

[Fixed to Ruin]

RIP Global economy

 

[The Crypto Guy]

 

[bobbyking]

ask a hamster for stock picks before Jim Cramer

 

[Fixed to Ruin]

Good old fashioned bank run

Customers line up outside First Republic Bank to take their money out

 

[Jacob]

All the local banks are quickly running out of money.

 

[ItsFineImFine]

 

[bobbyking]

All the local banks are quickly running out of money.

they never had it to begin with

 

[The Crypto Guy]

Here is the big crash I was speaking of for the last several months. It was just a matter of time. Things will be very rocky for the foreseeable future, best to not pay attention to your portfolios for awhile.

 

[Fixed to Ruin]

Here is the big crash I was speaking of for the last several months. It was just a matter of time. Things will be very rocky for the foreseeable future, best to not pay attention to your portfolios for awhile.

I don't disagree but if they cut rates and bail out the banks again we won't crash in the stock market indices. The crash will be in terms of higher inflation and loss of purchasing power.

 

[Jacob]

I just tried to withdraw at my local branch and they pretended like their computer system was down and to come back later.

 

[McGarnagle]

 

[Jacob]

I called and asked if their computer system was back up yet and they pretended to be a Chinese restaurant.

 

[TheGreenTBer]

I called and asked if their computer system was back up yet and they pretended to be a Chinese restaurant.

You don't do your actual banking at an actual Chinese restaurant? You're missing out.