Cash Is Not King In The Current Environment
Hey Jessavers
We're living in interesting times, the great nap has come to an end and the idea of saving in your local currency and taking out debt to live is no longer going to be the order of the day. We're going to have to rethink a lot of the ways we do things and one of them is challenging old cliches.
I'm sure you've heard the saying
Cash is King
It's been around for ages in pop culture and media and is a saying that has gone unchallenged until now. In more developed nations it hasn't been questioned but I think the fact that I live in a country with a highly mismanaged economy has given me a healthy scepticism of cash and local currency.
The fact is with all this quantitative easing and government relief programs pumping debt-based cash into the system, cash is no longer king. The lockdown and the monetary policies supporting it will drive deflation in certain markets and inflation in other markets and if you're not on the right side of those changes you will be hurt financially.
I've personally kept a large chunk of my net worth in cash as I look for opportunities to speculate, I know not all of us want to do this but if you don't speculate, someone will speculate for you.
Keeping all your money in cash, means you're interesting your wealth in the monetary policy of your government, do you really think that's a good idea?
Cash is an asset class
Cash is just another form of storing wealth and since its the most liquid its the most subject to debasement which is why you need to look at other forms of wealth storage. This could be bonds, stocks, real estate, precious metals, cryptocurrency, pension funds, money markets, other fiat currency, ETFs and more.
They all have their pros and cons and you'll have to research each one to see what kind of risk you want to take and what kind of returns you feel you need from your wealth.
Image source: - landlordology.com
Read the full article here
Have your say
What do you good people of STEEM think? Is Cash still king to you? Are you spreading your risk?
So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."
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Pension funds? They are all bankrupt with us.Todays elderly their pension is already wasted to... (mismanagement).
No matter where or how you invest it, your money will be gone or you pay high fees because the government knows what you have and do not want you to have cash. (Great for all those moments the power is down or the connections to the bank system fail again and you can leave your shoppings behind).
Cash is king? Never heard off, with us the customer is king. Only businesses who start with service will make it which is a good thing.
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Yes their are plenty of pension funds that are bankrupt the vast majority being public pension funds if you do your research and invest in private funds that aren’t too leveraged in mortgage backed sausages and have a portion in precious metals and certain stocks you’ll still have a floor even in a recession it’s not all as black and white as you make it out to seem
Yes the customer is important but they pay you with cash! It’s not as if the customer is trading with passing over his time or a bunch of gold bars! Sadly we still have to use cash! Almost 99% of all the worlds transactions are cash it’s going to take a while to reduce that dependency
Here it's everywhere the same. I i.vested years ago and they went bankrupt too (Aegon). I keep my cash. It's good for where I live, the bit extra fruit, luxury. I will not live forever and do not feel the need to do so for my children or grandchildren.