August 5, 2021

11 thoughts on “What Is The Fuss Over Fed Rate Hike And Its Impact On Us?

  1. A big clap goes to you for this write up. I never did understand why interest rate remains unchanged will be a bad thing. Thanks for the info. Seems like metal is a good hedge

    1. Hi Anonymous,

      Thank you for readings n dropping by. This is just my understanding of interest rate and highly probably that I am missing lots of things.

      Metal to be specific precious metal, to me, it's more like a storage of value if things turn really bad..:-)

  2. Congrats Rolf, to this great 'walkthrough' on interest and the economy.

    For me the key statement is: "This is not sustainable". No Ponzi-scheme – and I do count the current spiraling public debt as such – is sustainable forever.

    May I add one more option for reducing the heaps of debts? Don't count out a monetary reform such as "From Monday morning onwards we remove two zeros from your bank accounts and our debts. We are so sorry, but that is necessary". Happened so often before in history, just not in recent history so that we could easily remember.

    There are no easy exits from the policy mistakes that have been committed. All that remain are hard choices. Always to the disadvantage of us common people.

    I am with you on staying optimistic. Awareness is great as well, but useless if not followed by conclusive action.

    There are ways and means to prepare for the uncertain (but not improbable).
    Precious metals (not just any metals, steel is a metal too!), Land, and for those nasty Black Swan Events some Put Options to safeguard our long-term investment portfolio.

    1. Hi Andy,

      Haha.. removing two zeros! oh dear, painful really painful!

      Yes, agree on precious metal, land (if paid down or manageable debts).. put options I m not expert, so stupidly I keep certain percentage of cash in SGD with no returns!

      Awareness is for the public. Final thoughts which result in my own actions, I keep it to myself, in order not to mislead. Let the great lead and not the mediocre!

      Not because of selfishness but different people different, so maybe individual need to think and action for themselves in the circumstances they are in.

    2. Hi Rolf,

      Who knows, maybe they remove only one zero or even three. Seriously consider that scenario in your thinking too.

      Put Options are actually quite simple to get a grip on. No rocket science at all.

      Rolf, you being mediocre? You are way too humble. I like that, haha

    3. Hi Andy,

      Ok, all the omission of zeros, which were not suppose to be there even in the first place.

      Got it! Life as such when comes to money, is always "easy come easy go!" Even when money is "NOT easy come, it can be easy go, if not protected well!" Then it will be really painful.

      To be honest, I will not educate my children to be elite. They will lead a not so good life if they are. Leading is tough job. Nowadays I think it is probably easier to manage ur own fund than to manage a bunch of subordinates. People r just too complex.

      I prefer my kids to be mediocre as person strong in mind, happy at heart. With many other simple attributes like integrity, passion, positivity and hardwork, this is sometimes enough to outperform the elite frequently.

  3. Rolf,

    You are the few who got the irony between what I wrote on my headline and the actual one-liner post 😉

    Like the duck paddling calmly on the pond, but below the water line…


  4. Hi SMOL,

    Your one liner or single picture post always has a story behind another! 😉

    Maybe the duck need a boat instead. But the problem is still there, because after being save onboard, it will soon become "roasted duck!" hehe

    1. Hi Yeh,

      I read again and there is no mention that economy is bad now or will be bad since nobody know the future. It's only uncertainty ahead at least for now. Things may turn out just well. All I m saying is if interest rate continue to be zero, then if there is a unexpected downturn, recovery will be even harder than 2008 crisis.

      Meanwhile, since GFC economy was tamed beautifully and life goes on as normal n in fact almost on par prior to the GFC. Who knows, maybe the economy will be normal for next few decades or forever if it is beautifully deleveraged acc to Ray Dalio.

      Eg some illness like Kidney problems, can be under control for years with right treatments carefully. Patient can still lead a reasonably normal life if there is no serious relapse to be deadly. Of course the best solution is to have kidney replaced for everyone, but it is not as simple as it seems, analogous to the economy we are experiencing now.

  5. The increase of every tax, fee or price always hurts me well as I'm having two nickles to rub together. Usually I refer to Installment Credits online to take pay day loan and get some cash for a simple living till the next salary. I know that many people do that as have money troubles just like me. So I'm always against pressing such online loan services that really provide the helping hand to people in need. Unlike our governments does with the tax holders.

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