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Where would you invest money outside of the stock or bond markets?


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It certainly would be nice to find something that you could put money in when the market is high.

 

I've bought tax liens before and made 12% (in Louisiana).  But last time I went to an auction in IL all the good ones were going for 1%.

 

You could make personal loans to people on prosper.com (not saying that's a good idea.  I've never tried it.)

 

Buffett seems to agree with Racemize that single family homes would be a good bet right now.

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Value investors can do well buying private businesses and assets. Most private businesses sell for low valuations and are under-capitalized. Choose a niche and develop the idea. Who cares if it takes decades if the capital invested is small compared to the intrinsic value. In 1990 when timber and forestry were dead in BC I bought 500 acres of old silver mines with exportable timber and a private lake for $110,000. I figured that eventually you could buy planes which would use computers to fly so the middle class could pilot themselves to beautiful places and this lake had the advantage of being near Alberta. Meanwhile I have a nice place to fish and the timber grows 2 to 4% per year. Value investors don't care if they are asset rich but cash poor and since you see value many years out assets like this are more valueable to you than to others.

 

Last year I invested in a new business which has a removeable spray coating which replaces the blue plastic used in construction. I liked the business because it had many of the characteristics described in the best business thread. I literally had to pay off the bailiff so the only place I might find better value now is in Damascus. It is not as good as the 1% hard to make stuff to make vulcanized rubber discussed in the thread but it is hard to make as few things stick well to glass yet are highly protective and removable. Windows are also getting more expensive and there is a growing replacement market for energy efficiency. Amazing people are available and easy to find because of the interenet. I have licensed a gentleman in Europe who ran a major glass factory and who invented a type of fireproof glass but was seeking work and opportunities.

 

I am currently interested in a fulvic acid plant because the solar cycle is predicted to move into the drought phase starting next year. Fulvic maintains yield even when there is 40% less moisture. It also has many health benefits. The problem with agriculture supply business is that the buyers are monopsonists who squeeze the small suppliers. The current good weather and this problem is why the plant is in trouble. So now I am helping some other gentlemen establish a retail market for the Fulvic. I came up with the brand name for them. Its a nice business for them because you buy cheap by the litre and sell by the oz. If I can create a new revenue stream then investing into the plant will make sense.

 

I sometimes wonder why I scour the public market for pennies when dollars are lying around for the taking in the private sphere. It has never been easier to start up a private business.

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