Hi all. Got a problem that has been haunting me for some time. Two couples who are dear to me are contemplating buying houses. I have spoken to both of them but the subject is fraught with so much emotionalism and uncertainty that to fully broach the subject in all its ramifications is almost too much for them to absorb in a businesslike manner.
Years ago I came up with an “advice matrix”. It goes like this.
1. I give bad advice and they take it. Now they are angry at having taken my bad advice.
2. I give bad advice and they do not take it. Now they think I am a fool whose advice would have hurt them.
3. I give good advice and they do not take it. They are hurt, realizing that they should have listened to me. Resentment and rationalization come to the fore.
4. I give good advice and they take it. They are bettered by having taken my advice. They either appreciate my advice or deny that they had taken my advice. Don’t disbelieve that they can deny my good advice’s helping their situation; it had happened to me in the past more than once.
So in #1 they are angry. In #2 they think me a fool. In #3 they are resentful with rationalizations. In #4 they can either be grateful for my advice or deny that my advice guided them to safety.
As you can see, only #4 has the potential for a win-win outcome. So even good advice taken isn’t a sure thing.
So why advise others in the first place ? The answer is that seeing friends and family facing potential catastrophe would be painful if I were to say nothing. And I would have to carry that knowledge that I didn’t make them aware of the dangers.
Sadly, we are playing on a shifting field these days. We are aware of all the monetary manipulations going on which make the odds of a correct assessment nigh impossible. For instance, what of the looming potential for a massive bail-in occurring ? These recent articles spells it out :
http://ellenbrown.com/2014/12/01/new...-and-pensions/
Big Banks Will Take Depositors Money In Next Crash
http://usawatchdog.com/big-banks-wil...h-ellen-brown/
These two couples have money in the bank which I have already advised to withdraw and hold either cash or physical silver. One couple has a great deal of money in the bank and have told me that it would be difficult to withdraw so much money. I have told them why; it is because of fractional reserve banking wherein their money in the bank is actually not there but in various investments such as stocks, bonds, real estate and possibly derivatives. Probably only 1 or 2 percent of deposits are in the bank for day to day transactions. Telling this fact is always received with shock and confusion. The general populace is oblivious as to the precariousness of their banking security.
Couple one is paying $1,550 per month rent. They estimate that if they buy a house with $20K down, their mortgage payment will be about $800. They would save about $750 per month, $9,000 per year. In two years and two months they would break even if they were unable to continue paying the mortgage and have to walk away for one reason or another. That is their reasoning and I have to admit that it does make some sense. The only fly in the ointment is what the future holds within that 2 years.
Couple #2 is looking at buying acreage and building a house. They have enough money to pay in full and have no mortgage.
The overview here is whether holding cash or spending the cash on a house will be the better option. Time passing with all the potential changes that will take place will be like living on the side of a volcano, never knowing if there will be a catastrophe tomorrow or in a hundred years.
I have advised both of these friends that instead of buying a property right now (which may crash in the near future) to instead buy physical silver. The potential increase might make a world of difference. But nothing is 100% assured; we places our bets and takes our chances.
Best wishes,
Agnut