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Thursday, February 21, 2019

Wealth and holding onto it


Are cryptocurrencies doomed? Judging from this article in Technology Review, it doesn’t look good. One of the big features of cryptocurrencies was it’s supposed security. At the cure of the 1500 or so Bitcoin like currencies is the blockchain. They were advertised as being uncrackable. As it turns out, they aren’t as secure as once thought. Please read the article if you are into those currencies.

There are things I like about state free money. The very idea appeals that part of me that revels in living outside the system. For me one of the more interesting features was how easy it is to cross International borders and take your money with you. If you have to leave a repressive government in the middle of the night, that’s a good thing. However, at the very heart of cryptocurrencies are computers wasting resources and energy doing useless calculations. That’s my take on it. Feel free to disagree.

Traditionally, if your country was about to collapse, taking its currency with it, you’d convert as much of it as possible into something physical. Gold, silver and jewels are traditional. They have a lot of value for the space they take up. That makes it a bit easier to smuggle across borders.

Governments might say they are for free trade, but that ends when you want to freely trade your personal goods across a border. Border guards are trained to prevent exactly that sort of thing. Spoil sports.

When someone has a fair amount of wealth they like to hold onto it. Putting funds into real estate was usually a fair bet. Even that has limitations. For example, a Jew didn’t benefit from owning property in Nazi Germany. Politics can make property a liability. Most governments tax property. Unless it’s generation income from things like rents, it can be expensive to own. If you want to see real estate investing gone really bad just look at all the new empty cities in China build purely on speculation.

Unfortunately my investment situation is more along the line of buying another bag of dried peas and a box of .22 ammo. I don’t exactly have a lot of wealth to worry about. One less thing to deal with.

-Sixbears

11 comments:

  1. Because money backed by shadowy internet figures and a process nobody can adequately explain MUST be safer than money backed by the world's superpowers.

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  2. Don't know if gold would work out here in the native wilderness. I should learn how to barter.

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    1. Barter's good. Better to have a tribe and share in a gift economy. Works for me as I'm a lousy businessman.

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    2. Me too. I tend to give things away.

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  3. The 2007/2008 debacle changed my views about "wealth" being numbers on an electronic ledger. A lot of mine melted away back then. Now, I evaluate tangibles in terms of wealth. Some liquidity is necessary because you have to pay bills and buy this or that. But having a lot of money in stocks and other "electronic wealth" didn't work out for me. It's true though, that even property isn't 100% safe, since the supposed value of my property and buildings dropped precipitously almost over night back then. Again though, that was all electronic numbers, that didn't really impact me like losing the stock values did.

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    1. I talked with some people who did huge lifestyle changes due to the drubbing their wealth took in 2008. One person was so ticked off that she pretty much totally dropped out of the system and went off-grid. That was an extreme example but it was an attitude adjustment for a lot of folks.

      In the end, stuff is just stuff.

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  4. I feel really wealthy. I have a loving wife, a great family, and enough land to stretch my legs.

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    1. You are wealthy indeed. When I was about to lose all my material wealth I still had my lovely wife, family and friends so considered myself fortunate.

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  5. Yeah, part of my investment strategy are quality knives. They are sold world wide and can be traded for whatever currency (or taken in barter).

    That I really like them is just a coincidence . . . :^)

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  6. My list of precious metals post-SHTF:
    Brass (knuckles)
    Aluminum (arrows)
    Stainless steel (knives)

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