Friday, May 10, 2024

April 2024 update ($915,583 -$25,026 or -2.7%)

 Emerging Markets Stock Index Fund is up by $2,633 or+1.9%
Total gains: $2,633
Eurozone Stock Index Fund is down by $2,644 or -1.5%
US 500 Stock Index Fund is down by $11,963 or -3.1%
Global Small Cap is down by $7,761 or -4.8%
Growth fund is down by $1,819 or -2.9%
↓EUR to USD is down by 0.9% or $2,860
↓GBP to USD is down by 0.8% or $613
Total losses: $27,660

April 2024 Financial Independence


 From time to time I have been investing in gold but very small amounts. Over past 16 years I have bought around 22 troy ounces (one troy ounce of gold is 31.1035 grams).

 This happens every time I listen to US Senate debates. There is a lot of interesting information. For example, current $34 trillion government debt will be $54 trillion by 2034.   Current federal budget is $6.5 trillion and federal taxes collection is $4 trillion.

 If history tells us anything (specifically about German hyperinflation) that the easiest way to offload government debt is by printing money. Quickly all those bond holders will be bankrupt.  This kind of thinking leads me to buying small amount of gold from time to time.  I took some time to analyse it.

 If I kept my money without investing them anywhere I would have $35K today, inflation adjusted (if you believe US government figures) - $41K, my gold is worth $48K. Most of my investments have been in 2022-2024. US government says that $1 in 2008 is worth $1.52 today 0r 2.6% percent per year, on average.    $1 invested in gold in 2008 is worth $2.03 today or 5% a year, on average.  As an example, Warren Buffet holds his war chest ($189 billion and expected to balloon to $200 billion in 2024) in US short term treasuries. Three months treasuries are currently yielding 5.25%, while one year at 4.19%.

  It has to be noted that the gold is now all time high due to many conflicts and breaches of internation laws. There are no more neutral countries or safe heavens. If I will have opportunity, I would like to invest $5-10K a year into gold, since next ten years are likely to be inflationary and the government likely to keep interest rates below inflation to keep real estate market stable.

Investment in gold 2008-2024

Figure 1. Investment in gold over past 16 years.

Funny Fact: I am currently reading book about how German industrialists brought Adolf Hitler to power (there is no question of one mad man – the Germans knew exactly what they were doing). One fact made me smile, when young wife married for money, an older rich guy describes him: “he always worked twelve-hour days, arriving at his desk at 7:30am and returning home at 7:30pm., tired and battered. After dinner, he would sit in his chair, open Berlin’s financial newspaper, and fall asleep three minutes later. He complained that he had no time to read books or think up new ideas”. Now one is considered lucky to be away from home only for 12 hours.  Most people spent significantly more time and even weekends are spent part time working.  

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