The Weimar Nightmare in Review

[wayiwalk]

Re: The Weimar Nightmare in Review

The big concern with owning is the property tax, in my view.

I recently refinanced, paying down the mortgage and getting a good rate, with an eye toward reducing my monthly negative cash flow. So for the time being, I'm putting more money away, but I figure that in 4 or 5 years, taxes will have eaten that up!

The flip side of renting is where you rent. I was watching a TV program or online video about renters getting kicked out of foreclosed properties - that doesn't look like fun either!:mad: The key to renting is to make sure the owner owns without any financing.

Good article on the Weimer republic - the message keeps hitting home - sell anything of value that isn't tied down, and put it into "survival" goods (non-perishable food, and other essential supplies).

[radon]

Re: The Weimar Nightmare in Review

Something I plan on enjoying with realestate. Paying off my half million dollar home at 4% Fixed, with increased wages over the next 30 years. I may still be negative equity for a long time, but I will be paying the debt back with dollars that are eisier to come by (raises, tax breaks, flex spend plans).

We will not be able to get such inexpensive money in a few years when interest rates go back up. Get the money now while the gettin is good! If you can...

What would rising interest rates do to housing prices? It could be even more spectacular as the collapse after the bubble overshoots. Why not buy cheap and refinance later?

[Quincy K]

Re: The Weimar Nightmare in Review

Probably not, I'm saying that the leverage used to sustain high real estate is prices is disappearing and that hyperinflation would accelerate this process. This makes real estate a poor vehicle to preserve wealth. It is even worse when you think of the political risk and the difficulty selling it should it become necessary.



Your own residence doesn't generate income unless you're renting your basement; furthermore, you have to pay taxes and make repairs. This makes it a liability in my mind not an investment. Being self sufficient is a good way to minimize such liabilities. But by the end of hyperinflation your house will be worth a fraction in real terms of what you payed for it. Anyway, paying off your mortgage doesn't make any sense if you really think hyperinflation is coming. You can pay it off later with a goat and a couple of chickens.



It may become common in America against Americans. Don't forget to pay your taxes.



Sounds like another argument against investment in real estate to me. If you really think the rule of law and property rights will go in the crapper why on earth would you invest in something whose value depends entirely on those two things.

We are talking about hyperinflation in the US. The USG would never allow property taxes to rise concurrent with CPI if the event were to occur. And yes, you are correct that a SFR would have some liability during hyperinflation because insurance on the property would be worthless. You would risk loss even if insured if a covered disaster were to occur.

With that being said, a paid off parcel with a motorhome(where do you store the food?) and the rest in gold and silver would be your best bet.

You do not want to be homeless facing nature's elements(other homeless as well) during hyperinflation.

[Quincy K]

Re: The Weimar Nightmare in Review

I am going to enjoy not having any debt, spread my risk around and go about my life with hyper inflation below my chances of being hit by a cab

you know, that's what EJ thinks as well, the hit by a cab part. but I think that we all forget that just four months ago he went all physical(as opposed to etf) and doubled his exposure to gold.

That is not the behaviour of one that feels that hyperinflation/currency collapse cannot occur.

And if we go down(dollar), many more(currencies) go down.

[radon]

Re: The Weimar Nightmare in Review

We are talking about hyperinflation in the US. The USG would never allow property taxes to rise concurrent with CPI if the event were to occur.

All the property taxes I pay now are local. I'm not sure how the USG would react if they were raised. they haven't stepped in to help me yet. I used to live in a little town in NY and many of my neighbors had tax bills that were larger than their mortgages.

With that being said, a paid off parcel with a motorhome(where do you store the food?) and the rest in gold and silver would be your best bet.

I'm not into storing food. If we really go mad max I'll go out to the bush and do some fishing. I think that that scenario is unrealistic anyway. There is nothing wrong with lowering your debt and and becoming self sufficient, but as an investment in the context of hyperinflation buying real estate at this time won't do your net worth any favors.

You do not want to be homeless facing nature's elements(other homeless as well) during hyperinflation.

Buy a cabin in the woods. They are fun. Buy a stereo or a car too, but lets not pretend these are investments.

[jayers4647]

Re: The Weimar Nightmare in Review

I was always told to follow the money... Where do the richest 1% hold their wealth?

[goadam1]

Re: The Weimar Nightmare in Review

you know, that's what EJ thinks as well, the hit by a cab part. but I think that we all forget that just four months ago he went all physical(as opposed to etf) and doubled his exposure to gold.

That is not the behaviour of one that feels that hyperinflation/currency collapse cannot occur.

And if we go down(dollar), many more(currencies) go down.

I own gold. I own life insurance. I still own some bonds that go out until 2010. I still believe in spreading out risk. Betting on hyperinflation is like betting on a bubble but negative. Also, it's no way to live.

[metalman]

Re: The Weimar Nightmare in Review

you know, that's what EJ thinks as well, the hit by a cab part. but I think that we all forget that just four months ago he went all physical(as opposed to etf) and doubled his exposure to gold.

That is not the behaviour of one that feels that hyperinflation/currency collapse cannot occur.

And if we go down(dollar), many more(currencies) go down.

google sez...

Road to Ruin: Final stretch - Eric Janszen - iTulip.com

20 posts - 14 authors - Last post: Feb 23
In response, we are increasing our gold allocation to 30% and moving all Treasury holdings to the very shortest maturities, to three month ...

[goadam1]

Re: The Weimar Nightmare in Review

google sez...

Road to Ruin: Final stretch - Eric Janszen - iTulip.com

20 posts - 14 authors - Last post: Feb 23
In response, we are increasing our gold allocation to 30% and moving all Treasury holdings to the very shortest maturities, to three month ...

And now we have a general call to move into the long part of the curve (unspecified allocation) and a roundabout explanation that short term gold is going nowhere. So I'm pretty happy that I moved cash into laddering fdic insured cd's that run through September to the end of 2010. My treasury direct account is ready to play the short to long game. But 30% gold is too much for me. Not to sound obnoxious, but where would I put it?

Meanwhile, the gold I have covers me for a small possibility of hyper inflation.

[metalman]

Re: The Weimar Nightmare in Review

And now we have a general call to move into the long part of the curve (unspecified allocation) and a roundabout explanation that short term gold is going nowhere. So I'm pretty happy that I moved cash into laddering fdic insured cd's that run through September to the end of 2010. My treasury direct account is ready to play the short to long game. But 30% gold is too much for me. Not to sound obnoxious, but where would I put it?

:rolleyes::rolleyes::rolleyes:......

Meanwhile, the gold I have covers me for a small possibility of hyper inflation.

itulip puts the chances of hyperinflation at... what... 1%?

[goadam1]

Re: The Weimar Nightmare in Review

google sez...

Road to Ruin: Final stretch - Eric Janszen - iTulip.com

20 posts - 14 authors - Last post: Feb 23
In response, we are increasing our gold allocation to 30% and moving all Treasury holdings to the very shortest maturities, to three month ...

Okay, I re-read it. Seems like the most recent article hedges that article. Come on Metalman, what is your take? I think a itulip is hedging. Disaster is hard to time.

[Quincy K]

Re: The Weimar Nightmare in Review

[quote=radon;106004]All the property taxes I pay now are local. I'm not sure how the USG would react if they were raised. they haven't stepped in to help me yet. I used to live in a little town in NY and many of my neighbors had tax bills that were larger than their mortgages.

I'm not into storing food. If we really go mad max I'll go out to the bush and do some fishing. I think that that scenario is unrealistic anyway. There is nothing wrong with lowering your debt and and becoming self sufficient, but as an investment in the context of hyperinflation buying real estate at this time won't do your net worth any favors.





This thread is about hyperinflation and if it were to occur. I am not saying that it is going to. but if it were to occur and you did not have a years supply worth of food, the chances of you simply going "out to the bush and do some fishing" would be the same thing that one hundred thousand people would be doing as well. Angry people. Violent people. People you would not want to be standing next to with you fishing pole and can of worms. except these people will have guns instead of a shimano and will simply take your"fish" and shimano reel once they see fit.

get the picture?

unprepared people die during hyperinflations.


to think that a us dollar revaluation/currency collapse cannot happen within the next two years is simply being naive. 25 percent u-6(we are almost already there;presumably q2/2010)and there is going to be anarchy and civil unrest episodes abound.

[Quincy K]

Re: The Weimar Nightmare in Review

Okay, I re-read it. Seems like the most recent article hedges that article. Come on Metalman, what is your take? I think a itulip is hedging. Disaster is hard to time.

yeah. this drastic move coming from guys that have had the same portfoio, other than a few spec plays here and there, for some eight years.

[metalman]

Re: The Weimar Nightmare in Review

rehash... topic covered....

[goadam1]

Re: The Weimar Nightmare in Review

rehash... topic covered....

And we discussed it just like this. And then EJ got mad that we all got hysterical and started talking about guns. So, hold your gold.