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sucks for people like me with no debts though.
by dominotw 5y ago
sucks for people like me with no debts though.
- jquery 5y agoTake out some debt. I’m serious. That “free” money is there for you to take risks and invest with.
- macinjosh 5y agoHyperinflation begins when everyone decides this is wise and starts taking too many loans.
- legitster 5y agoUntil interest rates raise to balance out demand for debt.
- dominotw 5y agoinvest where though.
- cjbgkagh 5y agoLoan it to someone else at 0% interest.
- Workaccount2 5y agoIn the massive, bubble, err, stock market rally
- jquery 5y agoOops, if you did that recently, you probably lost a lot of money.
- all2 5y agoI was thinking about buying a truck recently and I got this bit of advice: "a loan is a hedge against inflation". More specifically, a fixed interest rate loan is a hedge against inflation. You are borrowing at an initial dollar value of A (in terms of inflation), and servicing your debt at a fixed rate, for a fixed time. During that time the value of the dollar decreases, and you now have a value of <<<A. This presumes that your income/cashflow will stay the same or increase slightly during the borrowing period.
- staticman2 5y agoI think that's bad advise, or at least incomplete, if the money that was going to buy a car is just sitting in a savings account you're guaranteed to be poorer since inflation will still hit your savings account plus you are paying interest on the loan.
- iancmceachern 5y agoAnd with a 0% loan it us even better
- redisman 5y agoYou can get very cheap car loan offers right now which might be interesting. 0 or 0.9% for 3-4 years. Given 3-7% inflation it’s a nice discount if you have the cash to take advantage of better returns
- ryathal 5y agoIt's only a discount if you get a YoY raise equivalent to inflation. Otherwise you just lose even more money.
- ldiracdelta 5y agoI'm not sure the psychic burden of debt is always worth missing the upside of inflation. I irrationally pay down low-interest loans even though it mathematically makes sense to invest those payments in something higher yielding. However paying off a loan to completion feels fantastic.
- pessimizer 5y agoWith no debts and no job, definitely. You're living off savings that are becoming less valuable.