Milu

Lowest for me was down about 19%, now down 8%. Trending back

Now that the S&P500 is almost back at level year-to-date it will be curious to see the mental gymnastics people go through about Trumps policies should we end up with a comfortably positive year.

Nice work, congrats.

Crazy returns. Have you historically had large returns and lots of volatility throughout your pre retirement investing history or did you just have conservative 10% compounding and then decide to go balls to the wall in retirement?

This discussion resonates well for me as my investment approach and philosophy is quite aligned. Have 9 positions, largest being about 16% of portfolio and smallest around 4% of portfolio. Might go a few years without adding any position and then could add 2 or 3 in a single year during a market downturn(2020, 2022) or when a quality company is selling for a cheap price (apple from 2013-2017). I don't sell too often but when I do I just fully exit the position, no real trimming. And when I buy it would always be a minimum of 5% position as I don't really subscribe to the concept of 'starter' positions. Don't want a load of cluttered sub 1 or 2% positions cluttering up my mental space and portfolio. Only add so far this year was a new position in LVMH at a 5% weighting. Cash weighting is 25% so would like to get that down to 10% eventually as I add further positions. Could take a few years for that though.

He seems like a smart guy and looks to have done well through his investing. If his approach has been successful for decades and provides for his lifestyle and family then it doesn't really matter if he ends up owning bitcoin or not. He'll do fine either way.

I’m somewhere in the middle when it comes to bitcoin. I’m not fully onboard with the “it’s going to change everything and everybody will own it eventually narrative”, and definitely not in the it’s a scam/tulip camp. I think it will continue to grow nicely as a gold alternative before eventually growing past gold ‘market cap’. It’s my biggest position and I sleep safe at night with that fact.

Thanks, that’s interesting to look at. Gold certainly doing its job of maintaining purchasing power. I wonder how this chart would have played out in any other country other than US. The two hundred year comparison between gold and the t-bill equivalent in Japan, Germany, Russia, China and likely every other country would have painted quite the different story.

Do you have the data to back that up? Would be curious to see how they calculate the returns.

Yes it would be very interesting to see an inflation adjusted price chart for Toronto or Vancouver real estate over past 50-60 years.

I would say gold is the only actual ‘money’ the world has. After using all kinds of materials (shells, salt, large stones) humans settled on gold as being the hardest form of money. Bitcoin is perhaps even harder.

Fair enough. I’m more in the long term store of wealth side of the argument, so like gold or land. I personally don’t forsee that we will all be using bitcoin as a currency for payments or short term treasury asset. Others in the bitcoin community have different opinions so will be interesting to see how it plays out.

More appropriate question would be if you needed to lock up your wealth for 10 years would you rather keep it in t-bills or bitcoin? Last 10 years you would have grown purchasing power much better with bitcoin, I’d be confident next 10 years will also come out ahead

I don’t think that question has any specific relevance to bitcoin though. If you needed $ for a project in 6 months the answer would always be t-bills regardless if the alternative was bitcoin or Berkshire Hathaway.

While I agree that when given the choice productive assets are likely better than unproductive assets. In reality though unless you are 100% invested at all times you will generally end up with a portion of your net worth in cash. The decision then becomes whether to invest your cash in productive assets at high prices (in the case of a highly valued market) or hold your cash in t-bills(like Buffett does) while you wait for valuations to get more reasonable. The main risk with that though is to potential to have your cash inflated away meaning you are losing purchasing power each year you sit in t-bills. What are the alternatives, perhaps instead of having all your cash in t-bills you might consider diversifying into places like gold (5000 years as a store of value) or possible Bitcoin (the new upstart).

I think bitcoin and gold will continue to co-exist for many decades to come. The one benefit that gold will continue to have over bitcoin is its privacy. Even though the blockchain is anonymous there is a digital history of everything carried out on its not quite a private as storing a bar of gold in your basement for a few decades. I sold a the gold I had a couple years back and just decided to hold bitcoin but I think gold has plenty of merit as a store of value. Just hated paying the 2 or 3% spread for buying physical oz’s

Yes I'd agree their is a speculative component to it. It's very hard to value assets with zero cashflows like Gold, Bitcoin, Collectibles etc. I think everybody would agree they have some 'value' but what is fair value who knows. It's impossible in my opinion to value gold. I think this description by Tony Deden summarised it best. "What makes gold compelling are the risks we do not take by owning it. No forecasting or guesswork is required. The risks we do not take owning gold could fill volumes. With gold, there is no duration risk, credit risk, or liquidity risk. The metal is not moved by financial instability nor threatened by national insolvency or chaos in foreign exchange markets. There are no margin calls and no refinancing risks. There is no risk of technological obsolescence, depletion, depreciation, or decay, nor does it require cheap energy, cheap credit, or cheap trade to remain viable. It does not care about your national energy policy or who you buy your gas from or how many pipelines are running. You do not have to keep the lights on or even keep it warm. There are no financial accounts to pore over, no balance sheet to blow up, no cash flows to dwindle, no stale inventory and no margin pressures in difficult times. There are no key manpower or supplier risks, no competitive risks, no management to squander its future. It does not depend on the character, skill, or enthusiasm of any one. It does not require the faith or good will of others. It does not require you to trust anyone at all, except that you must hold it in a very safe place." Bottom line: Gold is the only universally liquid financial asset that is no one's promise, which is why demand for it rises whenever trust in promises declines." Bitcoin has a lot of similar properties.

While I own some bitcoin myself I’m not in the everyone must own it camp. The bitcoin community is a diverse bunch each with their own beliefs and approaches. My preferred portfolio would be 100% in top quality companies at fair prices. I’d rather not have to hold unproductive assets like cash, gold, bitcoin. But when I have a decent cash holding and don’t find many investments that meet my hurdle rates I need to be able to hold at least some of my dry powder in assets that can maintain their value. I’m not as comfortable as buffet his holding 30% of his assets in t-bills. Even with the good 5% yields I’m not sure they are keeping pace with actual inflation on a gross basis and definitely not after tax. Gold/Bitcoin at least give an escape hatch should the money printers get revved up again.

I’d tweak that slightly and say it’s a new form of gold(scarce, finite asset) rather than currency. Lots of people including many respected ‘value’ investors hold gold as part of their portfolios and it proving to be quite the portfolio diversifier in times such as now. Bitcoin has a good chance of serving the same purpose.

He hates puppies too.

I’m wise enough to realise that there are no certainties in life. When I am confident about something I will make a significant investment, but I’m not stupid enough to think I can’t be wrong.

What’s the benefit of trading and trying to estimate if it’s cheap or fairly valued? Just buy bitcoin, have the conviction to hold through the various drawdowns and come out the other end in 10 years with 5-10 times your money. Seems unnecessary to trade it and pay taxes, wonder how much you expect to come out ahead of a simple buy and hold strategy?

Very well said. Particularly your last sentence. The Trump is a hitler, Elon is a Nazi stuff is ridiculous. I’m continually surprised at how many seemingly intelligent people I know in real life or on the forum who continue to make the comparison. It’s ok to just not like somebody or even hate them, but this constant equating to Nazi’s is a bit dumb.

Haha true, I was trying to give a diplomatic answer but your response would have been easier

Article seems like a bit of a hit piece really. Usual sign of this are the excessive use of loaded terms and mind reading. For example “Musk, “with a very condescending smirk,” hit him with a line from the 1999 movie Office Space: “What would you say you do here?” Or “Musk has gleefully banished tens of thousands of federal employees” Seems like the author must be a psychologist who can pick up when musk (a person who has autism/aspergers) is smirking in condescending manner or just smiling in a social situation. And can also determine when he is gleeful or somber when firing people. This guy is wasting his talent in the field of journalism. Reading up on Russell Conjugations might give you a bit of insight into what’s going on with this article. https://bigthink.com/the-learning-curve/the-russell-conjugation-a-rhetorical-trick-that-loads-words-with-emotion/ Musk has a lot of flaws but let’s try to save the nazi comparisons for actual nazis.