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US Economy in CRISIS! (pg. 16)
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| StereoPrincess |
| well if you think about it, at 65, many people are still very healthy and they expect to live another 20-25 years. no one thinks that they are going to die in two years. |
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| MarkT |
| quote: | Originally posted by Skipper
Really? I don't understand that...why not park it in a dividend paying stock or a trust? (ignoring trust conversion legislation in the short term)
If you're going to play with risky assets in retirement, you should know exactly what the risks are - mainly, losing a ton of money at the drop of a hat. |
absolutely. anyone near retirment age with a significant portion of their portfolio in equities is either an idiot or has a *really* incompetent financial advisor.
| quote: | Originally posted by StereoPrincess
well if you think about it, at 65, many people are still very healthy and they expect to live another 20-25 years. no one thinks that they are going to die in two years. |
true, but that's all the more reason to be out of volatile investments by 65. some cycles last ~10 yrs and you can't have your portfolio in the toilet for that long.
as Sarah noted, they should be primary concerned with income at that stage, not capital appreciation...e.g. dividend paying stocks/funds, where the price fluctuation is secondary to the income produced. e.g if you own financials (which have tanked), you're still receiving the dividends.
contrary to popular belief, investing is not about "making money"...you work to make money. investing is about earning a return on your savings. the *potential* return is generally correalted with the risk involved. high risk, higher potential return.
higher risk, like commodities, is fine when you're young and have 20, 30, 40 years of employment income ahead of you. if something tanks, you're investment horizon is far enough in the future that you can ride out the cycle...or if you make a poor stock choice (e.g. company fails), you have time to replenish savings from your future income.
someone who is retired, or near-retired, doesn't have that income-earning time in front of them...even if they live to age 90. they can't recover from a loss as easily (unless they have a really good pension). They should be in investments paying a more moderate return, with much less risk to their principal. |
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| Skipper |
| I think a lot of people got into the mindset that commodities aren't as high risk as they actually are. It's easy to buy into the "people still have to eat" or "peak oil is here" arguments - especially given the media's attention to commodity/resource related issues...and Al Gore of course. Actually, I think I blame Al Gore for the commodities bubble that occurred in the Canadian market. Either him or the axis of evil. |
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| jonnystel |
Holy guys!!.. I'm in florida right now and this is awesome!.. you can literally buy a condo in DOWNTOWN west palm beach (VERY nice area) for 120 grand.. and thats like baller status 2 bedroom 2 baths built less then 5 years ago. nice finishes . and approx 1200 sq ft
I hope this happens in Toronto! lol. I'm in the position that my job will be positively affected by this and I've been saving up to buy a place for a while but prices are so artificially pumped up you would have to be an idiot to buy anything now.. !!! |
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| MarkT |
^^^ hell, in some areas of the states, all you have to do is be willing to pay the BACK TAXES and the property is yours, lol.
a co-worker and his brother bought a large 2 bdrm condo in Florida (not downtown in a big city, but still a decent location) for under 50k. That's ed.
you can bet that real estate speculators are having a field day with the current situation. If you have money and do your homework to determine areas that are likely to recover sooner...you could make some good coin in the coming years. |
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| Skipper |
| quote: | Originally posted by jonnystel
I hope this happens in Toronto! lol. I'm in the position that my job will be positively affected by this and I've been saving up to buy a place for a while but prices are so artificially pumped up you would have to be an idiot to buy anything now.. !!! |
You hope this happens in Toronto?
I'd rather pay higher prices than see 40% of Toronto homes foreclosed on. :rolleyes:
The problem with cheap US homes is getting a mortgage to pay for it. |
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| exstasie |
| quote: | Originally posted by Skipper
You hope this happens in Toronto?
I'd rather pay higher prices than see 40% of Toronto homes foreclosed on. :rolleyes:
The problem with cheap US homes is getting a mortgage to pay for it. |
ummm...+1 lol
I hope you were joking with that post.
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| DigiNut |
| quote: | Originally posted by jonnystel
I hope this happens in Toronto! lol. I'm in the position that my job will be positively affected by this and I've been saving up to buy a place for a while but prices are so artificially pumped up you would have to be an idiot to buy anything now.. !!! |
Except that they're not artificially pumped up, they're costly due to ordinary supply and demand (and a few political factors but that's irrelevant here).
It's not as though real estate developers all got together in a smoke-filled room and said "Hey, let's all charge 50% extra for everything we build!" |
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| Skipper |
Presidential debate tonight!
US markets are tanking for yet another day! |
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| spolitta |
| quote: | Originally posted by Skipper
Presidential debate tonight! |
lol, I hope they won't debate about economics because neither of them knows ... |
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| malek |
| quote: | Originally posted by DigiNut
Except that they're not artificially pumped up, they're costly due to ordinary supply and demand (and a few political factors but that's irrelevant here).
It's not as though real estate developers all got together in a smoke-filled room and said "Hey, let's all charge 50% extra for everything we build!" |
speculation is when people buy units hoping to sell them back at profit in a few months. People buy 2-3+ units and don't live in them.
I still remember a reportage showing people waiting as long as 1 week to buy condos in new projects in toronto. When interviewed, these people were exactly mentionning that "buying to sell and make profit". Some even sold their position in the line for 10k+ to others late comers.
How many empty units is there in Toronto? With Toronto attracting and retaining 75k new residents last year compared to over 100k a few years ago... a crunch is bound to happen sooner than later. |
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| jonnystel |
| quote: | Originally posted by Skipper
You hope this happens in Toronto?
I'd rather pay higher prices than see 40% of Toronto homes foreclosed on. :rolleyes:
The problem with cheap US homes is getting a mortgage to pay for it. |
yes your right.. thats why this is good and benefitial for people who don't necessarily need mortgages to buy a 100,000$ house. and hell yeah i hope gets foreclosed cuz if you have money to buy those houses. YOU WIN lol
And i mean. why are there foreclosures in the states?.. cuz the idiots that couldnt aford houses were buying them lol. who's fault is that. its good that they lose everything . did they not see it coming ? i mean it sucks that banks were giving out no down mortgages and stuff to people that clearly arent ready to buy a house. but man. u can' feel sorry for those people who clearly cant manage their money. |
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