What is your panty dropping bet to score HUGE when inflation comes?
- Thread starter Saltynuts
- Start date
Bitcoin is a less risky investment asset now in 2021 than in previous years
The reputational and career risk have been removed and this is the reason you're seeing all the big names jumping in on the bitcoin bandwagon
Many posters on ET will say bitcoin is too high and will crash soon, but bitcoin at $900B market cap seems pretty low imo and there's overwhelming demand right now from institutional and hnw investors
That market cap is much lower if the ~4M bitcoins that are lost forever are taken into account
1 hour. Anyone in here including the OP surely can spend 1 hour to watch (or listen) to a video on the weekend when the stock markets are closed. Bitcoin and crypto digital assets are open, though.
Don't be afraid to watch a video. It will not brainwash you and even if it tries to do that, have confidence in the strength of your mind not to be manipulated
Inflation is coming.. I don’t know about 70s style, but if so, yeah. Short bonds. The problem with that is it’s going to take years. And bonds move so slow until they don’t. In the meantime, rates below 3, but climbing, is like throwing firewood and kindling onto the already flaming fire of equities. Small cap specifically. Rates don’t go from 1% to 16% on the daily sticks. Quarterly sticks. You’ll be aware if your theory is playing out as it’s happening.
All fiat currencies are facing the same-ish stuff (except the yuan). Right now silver (and to a lesser extent , gold) have what I consider nice setups. On the gold side, I’d wait for the breakout that’s currently being taunted. Silver may bounce around for a week or two, or it may just take off this week. It’s always so tough to call the moment. But it’s around now, based on my reading of the accumulation structure. If silver drops below 26... then maybe not. Oil and copper don’t suck. In your scenario, probably a basket of commodities gives you shelter.
All fiat currencies are facing the same-ish stuff (except the yuan). Right now silver (and to a lesser extent , gold) have what I consider nice setups. On the gold side, I’d wait for the breakout that’s currently being taunted. Silver may bounce around for a week or two, or it may just take off this week. It’s always so tough to call the moment. But it’s around now, based on my reading of the accumulation structure. If silver drops below 26... then maybe not. Oil and copper don’t suck. In your scenario, probably a basket of commodities gives you shelter.
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TIPS, energy
The only correct answer here.
I don't think we will see a 21% prime int. rate like I did in the 70's. There is just too much excess capacity thanks in part to globalization. But I think inflation will exceed the Fed target, whatever that may be, and by a lot.
REAL ESTATE:
I think the best "everyman" hedge is real estate. My wife and I are selling a 7 figure house and buying a new 7 figure house. I really wanted to downsize on the price, but I'm OK being a little over weight on RE. I look at it as just moving one asset (equity/cash) to another, real estate, that will do well with inflation.
GOLD:
Contrary to the common wisdom, gold really isn't such a great inflation hedge.
BITCOIN:
I came this close to buying some GBTC (private placement) a few months ago and really regret that. I would have been in BTC at 17,000. I think BTC will be a good hedge. It's just too f****** volatile.
COMMODITIES/BASIC MATERIALS:
Last week I bought some XLE XME CVTA COMB, adding to FCX and others in that space. I think these type plays do well in an inflationary environment and will do well with more stimulus/infrastructure spending.
Tuesday I will probably be buying some more like this. One very interesting stock that came up in a screen is TROX. Their Income/Sales ratio is 34.6%
REAL ESTATE:
I think the best "everyman" hedge is real estate. My wife and I are selling a 7 figure house and buying a new 7 figure house. I really wanted to downsize on the price, but I'm OK being a little over weight on RE. I look at it as just moving one asset (equity/cash) to another, real estate, that will do well with inflation.
GOLD:
Contrary to the common wisdom, gold really isn't such a great inflation hedge.
BITCOIN:
I came this close to buying some GBTC (private placement) a few months ago and really regret that. I would have been in BTC at 17,000. I think BTC will be a good hedge. It's just too f****** volatile.
COMMODITIES/BASIC MATERIALS:
Last week I bought some XLE XME CVTA COMB, adding to FCX and others in that space. I think these type plays do well in an inflationary environment and will do well with more stimulus/infrastructure spending.
Tuesday I will probably be buying some more like this. One very interesting stock that came up in a screen is TROX. Their Income/Sales ratio is 34.6%
Thanks so much everyone. I am reading over everyone's ideas still, all very interesting. But I had an epiphany I think.
Let's say gold is at $1,800.
Let's say the fed increases the money supply by 30% over a period of time. Let's say the "fundamentals" for gold have not changed in the meantime. So gold increases by 30% in price (as it should to reflect the fact that there are 30% more dollars chasing the same amount of gold).
But in that case, if you sold you gold for $2,340 (30% gain on $1,800), you are literally NO BETTER OFF because your $2,340 is upon the sale worth only the $1,800 it was before the investment because each dollar is now worth 30% less! So have you really GAINED anything at all? Clearly you are better off than if you had just held the cash, but you are really no better off from where you were before, are you?
Maybe that is why 2rosy and Stockpredictor said issue debt. There you REALLY WOULD be better off because that 30% rise in prices means you debt is in effect worth 30% less. So are there any other asset categories that really GAIN in an inflationary environment, as opposed to just "hedge" against inflation by essentially offseting it?
Time to buy a big new house on a lot of borrowed debt at cheap rates it seems!!!
Let's say gold is at $1,800.
Let's say the fed increases the money supply by 30% over a period of time. Let's say the "fundamentals" for gold have not changed in the meantime. So gold increases by 30% in price (as it should to reflect the fact that there are 30% more dollars chasing the same amount of gold).
But in that case, if you sold you gold for $2,340 (30% gain on $1,800), you are literally NO BETTER OFF because your $2,340 is upon the sale worth only the $1,800 it was before the investment because each dollar is now worth 30% less! So have you really GAINED anything at all? Clearly you are better off than if you had just held the cash, but you are really no better off from where you were before, are you?
Maybe that is why 2rosy and Stockpredictor said issue debt. There you REALLY WOULD be better off because that 30% rise in prices means you debt is in effect worth 30% less. So are there any other asset categories that really GAIN in an inflationary environment, as opposed to just "hedge" against inflation by essentially offseting it?
Time to buy a big new house on a lot of borrowed debt at cheap rates it seems!!!
By "issuing debt", you obviously mean borrowing. I agree. If you think high inflation is coming than this is the time to borrow to the hilt at low fixed rates, if you can. But the folks here want to make a killing trading on their guess that we are headed for double digit inflation. Probably they are wrong. but if they are right? I remember all those who posted here and were convinced that QE coming out of the great recession was bound to lead to hyperinflation.
