Posted: Mar 13, 2020 3:36 am
jamest wrote:I don't think that you understand the detrimental effect inflation has upon your money, nor the risk of your bank going bankrupt and your savings disappearing completely.
Your thoughts in that regard are based on nothing but your emotion. I know exactly what inflation is and how it affects money supply and value.
In terms of risk of going bankrupt and losing my savings, the risk is essentially zero. The only way it could happen is if I was unable to work.
jamest wrote:IThe value of $1 is not universally constant, as of course prices tend to rise every year. I'm sure you'll agree that $1 back in 1920 had more buying power than here in 2020?
With respect Jamest, I don't need a course in elementary economics from you.
jamest wrote:ILikewise, I shouldn't have to explain the risk of leaving your savings in your bank, given what happened in about 2008 when many big banks would have collapsed if it were not for government intervention. That same risk presents itself to us again in 2020, though this time alongside the pandemic.
That's exactly the point of putting your savings in a big bank - the government has vested interest in ensuring they don't collapse. That's one of the most vital differences I've seen you miss numerous times. If bitcoin crashes, no one's going to do a damn thing to protect you and your money.
jamest wrote:IIt's a very bad time for all, but to say that you have money and that the value of said money has been unaffected all year, is very naive.
You say 'naive' in the total absence of any knowledge. You don't have the faintest idea about my finances, so how are your assertions relevant to anything? As I've just told you, my money has been entirely unaffected.
jamest wrote:IDid I 'gamble' when I got my money out of my pension and invested it into crypto and the precious metals?
Oh yes, absolutely without question. In essence, you gambled twice; once for removing your money from somewhere safe, and once for investing it in something volatile. Precious metals are generally ok - they're no different in returns than a bank by and large, and have about the same security as there's never going to be no demand for them... well, for the foreseeable future, anyway. But cryptocurrency has exposed you to dramatic risk, way beyond anything remotely equivalent to a bank or pension scheme.
jamest wrote:I Not really, because I knew what a fowl state the global economy was in and how it was destined to play out over the near future. However, I hadn't planned for a global pandemic into that scenario which would instantly spook everyone.
You can't plan for these things, and that's exactly the point. Next time you think you can predict the future, reflect on this. The fact is that it's not the predictable which can cause unexpected problems, it's the unpredictable, and because it's unpredictable, the effect of it is invariably going to be dramatic.
jamest wrote:IWhat's for sure is that wherever I've invested my money, wherever you've invested yours is equally as much of a gamble.
Factually untrue, and for someone who's investing in cryptocurrency, this is surprisingly lacking in understanding of the entire point of investments risk profile versus reward. My money gives me no reward, but it is nearly perfectly safe. Your money is now tied up on the back of a bucking bronco - you may come out well, or you may lose all of it. That's why what you're doing is gambling.