How should we, the indolent and working class, invest our money? The tall people in suits with lofty degrees tell us to invest the hard-earned payroll money in investment funds where experts using complex derivative algorithms and stock market curves buy and sell and earn extensive commissions, making them millionaires, and inflation soars. Is this real? Is this American? Should the educated become millionaires, manipulating the funds of the working class? The people who work for a living do not have the time to be active investors, where active investment is defined on the 1040 as a 20% time investment. There will always exist the rich and the poor, and the well-to-do usually live off the working class in some way. The Frankenstein monster is born.
Stocks are paper, and rise in a bull market usually after a war. With common stock, an investor only gets proceeds in a liquidation once the preferred and treasury stock owners assume the balance of the corporation’s assets. Try to buy preferred stock with a broker! If an hourly worker wants to invest in stock, they must choose a business with a large asset or owners’ equity, unlike most of the skyrocketing dot com apparent today. Just access a prospectus online, and if the assets are huge, then in a bull or bear market, it is time to invest in the long run. Blue chip stocks usually are stable investments for the long run.. Foreign or gold stocks, while looking unbelievably lucrative, can bottom out in a second if the new government steals the cash. These are gamblers’ fodder. Another way to choose investments in the long run is by net income. Get a PDF prospectus of the stocks you are interested in and choose the ones that have a steady and increasing net income value in the current period, and go with it. If an investor wants to make big money in the short run, make a product, build a factory, and sell it once it gets big. The most stupid investment in the long haul is real estate. Thomas Jefferson guaranteed all citizens a piece of land for themselves and their children; he didn’t say to speculate on property, sell when it is high and then move. To make a killing in real estate, buy low, sell high once a business or government moves in and makes a product or starts a function, then move on. In this author’s opinion, real estate salesman, luring citizens with the prospect of big profits in investment property, is both a heartache and a pain in the ass. Everything is always breaking and people who have lost their jobs have to be evicted and thrown out into the street. In Adam Smith’s book, “The Wealth of Nations,” rental real estate is the basis for accumulating wealth and is best perpetrated by a heartless cad like Simon Legree.
A bond is like stock; it appreciates in a bull market, and like stocks, becomes worthless if the market becomes bearish and nosedives. The difference between bonds and stocks is basis, just like bitcoin, and bonds have no basis. A bond is merely an IOU by a wealthy person or investor to pay back a loan at a later date with interest for the privilege of lending money. Bonds deliver a fixed taxable income and are useful in a retirement portfolio if and only if the economy is good.
Municipal bonds are the only bonds this author likes because the basis is a public work that people need to live. Municipal bonds are usually base on gas, electricity or water. These are what we need to live. Dividends generated by municipal bonds are not taxable, although they appear with lower numbers, and people would rather not eat than have to part with their Sony play stations and Battlefield 6, or have to stop viewing adult entertainment on their satellite feed.
For a stable income that is transferable to kin before demise, buy municipal bonds. Government treasury bonds no matter how stable they appear, can disappear like other stocks and bonds if the government declares bankruptcy and they are not FDIC insured. The menial, pecuniary interest of government bonds does not warrant purchase in a scenario of rampant inflation and obscene national debt.
I am just one of the stupid folk, in-between jobs, who loves his morning coffee and prays that his children will be educated, have families, go to church, and share in the liberty and freedom that many of our fellow men and women have died for. A lackluster FDIC-accredited bank that pays low interest on savings and tries to gouge clients every chance they get is the best chance the people have to live a bright future and raise their children. All accounts insure for up to one hundred thousand dollars in case of default, nuclear explosions or attacks by the Martians. A three-month CD that pays 4 percent and is guaranteed to be there once a citizen returns from a lunar mission is the way to go. Of course, this percentage does not match the 16% inflation rate, but the task of a free society is to eliminate or exile the people who cause the inflation.
Looking back to economics 1, taught at a junior college, the economy is like a pump with a closed circuit; it goes round and round. The pump leaks, and a citizen has to continually add money to the pump to keep it going. In other words, work part-time until you drop and spend money on products to keep the pump pumping. Do not feel obliged to give your children a huge treasure chest. People born with a silver spoon in their mouth do not amount to anything, and the maker wants the chosen few to help the underprivileged by educating and feeding their children until they can stand on their own feet. Like it or not, Yahweh watches, and he notices, and he rewards the faithful in ways that cannot be imagined. Getting on a plane and living in hotels gets old after a while, and making a human being successful is the only gift that the maker requires to be one of his own.