Did anyone suppose that we would not notice?

Discussion in 'Finance' started by pjohns, May 31, 2018.

  1. pjohns

    pjohns Well-Known Member

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    For many years, banks (and other banking-type institutions) gave APR (annual percentage rate) on savings.

    They also charged APR on their loans.

    Even today, they charge APR on their loans
    .
    Yet they give only APY (annual percentage yield) on savings.

    In short, the first is compounded; the second is not.

    Did they really imagine that no one would notice?
     
  2. Old Man Fred

    Old Man Fred Well-Known Member

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    I haven't concerned myself with cash savings since I was about 12.

    You keep the bare minimum amount of cash around, as cash is nothing but a temporary method of exchange for the value of labor. Liquid assets are worthless until you spend them, and I don't put my money in something of no value.
     
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  3. pjohns

    pjohns Well-Known Member

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    Do you, then, invest in stocks? Bonds? CDs? Money markets?

    Or what?
     
  4. Old Man Fred

    Old Man Fred Well-Known Member

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    High yield blue chips and municipal bond ETFs are my bread and butter for liquid assets, although as a construction worker I prefer real estate. If you have the cash for a down payment you can get a mortgage for next to nothing, and I enjoy finding new properties and working an extra 4 hours a day renovating a new big project.

    Right now though, as both the real estate and stock markets are extremely overvalued, I'm parking most of my money in bond funds. I'm hoping for a correction, and to have enough cash to snatch up another property or two when it happens.
     
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