Short and sweet:
How much capital would be enough for you?
When do you have "enough"?
And to those who don't understand, can't or don't want to answer this question: What does that say about you? 😳
Top Movers Today
Today something completely different on the subject of finances. I've always seen posts like "How high is your savings rate?". But on this point I look at it a little differently, namely how high is your savings rate compared to your consumption rate. I still refuse to slip into frugalism with all this investing. That's why it's important to me to use the time in my life for whatever I'm passionate about. If I had to compare my life, I would always see myself a bit like Tim Schäfer 😂Saving yes, traveling a lot yes, but "senseless" consumption no. In addition to my savings rate of €1000, I still manage to take 4 big vacations this year. But of course this also plays a role: Single, no children, no car. You should also bear that in mind, of course. So my savings rate / consumption rate is roughly 60/40.
But now to you. How does this comparison look for you? Do you already have frugalist tendencies or do you prefer to live more, have a family and save less?
p.s. I only pay €5 for the Germany ticket, so transportation is not listed separately.
Is Harald right? Is $BTC (+0.12%)
a Ponzi scheme?⛄(866845)
Thanks for your contribution @Madhatter5566 !
With this post I would like to take the opposite position once again and express my opinion. If you missed Harald's post today, you should read it before this post to know what it's about: https://getqu.in/duSdcl/
What is a Ponzi scheme?
Definition according to Harald's Wikipedia article:
"A Ponzi scheme or pyramid scheme is a business model that requires a constantly growing number of participants to function, like a snowball rolling down a slope and constantly growing. Supposed profits or returns, or rather liquidity surpluses, are generated almost exclusively by new participants in the system contributing or generating their own capital. Sometimes there is no product at all or only an overpriced product, making it a fraudulent offense."
The following core elements of a Ponzi scheme can be derived from this definition:
(1) The need for a constantly growing circle of participants: The system only works if new participants are continuously added.
(2) Profits from the capital of new participants: The returns of existing participants are mainly financed by the deposits of new members.
(3) Missing or overpriced product: Often there is no real product or the product offered is overpriced and only serves as a pretext.
In addition, the following characteristics of a Ponzi scheme are mentioned to distinguish it from a Ponzi scheme:
(1) Typical "incentive": High profits through a one-time investment in order to subsequently distribute the product yourself. The Ponzi scheme is often not a genuine product that is usually traded. It is often only permitted to sell the "product" to customers who are also distributors or want to become distributors.
(2) Payments: One-time or recurring participation fees. The profits come from the new customers that you have recruited yourself.
(3) Interaction with the founder: Interaction with the founder sometimes does not take place. New investors are recruited at all levels of the pyramid scheme.
(4) How it works: Fees from new customers finance the success fees of current participants.
(5) Collapse: Fairly quickly, because in order to maintain the system, a multiple of new customers must be acquired at each level.
Now that we have clarified the core elements and characteristics, we can take a step-by-step look at the extent to which Bitcoin fulfills these characteristics.
Applying the core elements of a pyramid scheme to Bitcoin:
(1) Need for a constantly growing pool of participants
(2) Profits through capital from new participants
(3) Missing or overpriced product
Applying the additional features to differentiate it from Ponzi schemes:
(1) Typical "incentive"
(2) Payments
(3) Interaction with the founder
(4) How it works
(5) Collapse
Summary and conclusion:
Based on the above points, in my opinion, Bitcoin does not the criteria of a pyramid scheme. Here are the main reasons again:
Finally, I would like to briefly address the valuation issue that I think Harald was getting at:
Bitcoin has no intrinsic value. This may come as a surprise to some people, but I agree with Harald. According to the Austrian school, however, this "intrinsic value" does not even exist, as value is ALWAYS subjective. If I subjectively estimate the value of a good to be higher than its market price, I am prepared to buy the good. The seller, in turn, only sells the good if he subjectively estimates its value to be lower than its market price.
Bitcoin does not generate any cash flow, which is why it must have an intrinsic value of exactly 0 from a traditional financial perspective. This is why many economists find it so difficult to attribute a value to Bitcoin.
However, Bitcoin does have intrinsic properties that make it valuable. I have presented some of these in this article, for example: https://getqu.in/G8t0Nm/
I hope I have now been able to give you my view on the subject. This has caused heated discussions between myself, a few others and Harald in various threads here over the last few days.
I think it's great that Harald has written a constructive contribution regarding his views. That deserves recognition - I wouldn't have expected it.
And I didn't want to just clumsily point my finger at a few of his arguments and claim that they are nonsense, but rather consciously try to take a constructive counter-position.
You can and should all form your own opinion on Bitcoin. Under no circumstances should you invest in something like Bitcoin because there are people like me who keep publishing articles about it - instead, you should form your own opinion according to the motto "Do your own research" and make your decisions based on this. To do this, it is also important to listen to controversial opinions from different people.
Conclusion: I also leave it up to the reader :D
Have a nice day!
Luxury or basic need: what do we really need to live?
Hey everyone!
At the moment, I'm often asking myself what really counts as a basic need and what is a luxury.
The boundaries sometimes seem to be quite blurred - but is that really the case?
For me Food, housing, heating, electricity and clean water are clearly part of the minimum standard that everyone should be entitled to. (Not to mention basic medical care).
These things are necessary to live a healthy, safe and dignified life.
When we talk about basic services, such basic services should be accessible and affordable for everyone.
But what about other things that are often taken for granted?
Alcohol, tobacco or even vacation trips are examples that, in my opinion, should be seen more as luxury goods - and here I think there are good arguments for and against.
Arguments in favor of seeing these things as luxuries:
Health risksAlcohol and tobacco are known to be harmful to health and are not a basis for a healthy life. Some might say that such stimulants should not be part of the basic diet, as they are the opposite of a necessity.
Costs and quality of lifeVacation trips may contribute to relaxation and personal development for many, but they are not a prerequisite for a secure life.
Arguments against seeing them as a luxury:
Quality of life and mental healthA vacation or even a glass of wine can significantly improve quality of life. Some people would say that relaxation, self-care and enjoyment are also part of a dignified life - not just the bare minimum standard of living.
Social expectationsThere is also the point that our society often sees a certain way of life as standard. Things like vacations in particular have become normal for many and an important social issue - it can be stressful to be excluded here.
In the end, I personally think there should be a balance:
Basic needs must be secured for everyone, and that should always come first.
Luxury goods can enrich the quality of life, but in my opinion they are not necessary to live a safe and healthy life.
For example, I myself cannot understand why some people have an attitude that everyone must be able to go on vacation 2-3 times a year and that this must also be affordable. Regardless of your profession or income. (I'm not talking about an extended weekend in a self-catering guesthouse, but a club hotel vacation with a flight, at least 4 stars, etc.)
I currently go on a small vacation once or twice a year, but I don't consider it normal and am grateful that my job allows me to do so.
As a child, apart from an extended weekend with relatives, I didn't have a "real" vacation with my family and so I didn't really miss it.
But I also didn't grow up with this kind of vacation/recreation as standard.
How do you see it?
Where do you draw the line between necessity and luxury?
If you see vacations as a necessity and not a luxury:
Should there then also be a state budget for low incomes when going on vacation, so that e.g. pensioners, families with low incomes etc. can apply for appropriate support?
(Until 2010, for example, recipients of basic income support and Hartz IV in Germany could apply for money once a year to have a vacation up to X amount paid for by the authorities. This no longer exists and such a funding pot has been completely dissolved).
How I beat the MSCI World by over 21,000% over 13 years
Part 1: My megalomaniac Bitcoin plan
TL;DR Luck. Through pure luck. Luck, coupled with youthful stupidity / idealism, some bad luck but ultimately even more luck. Of course, that had absolutely nothing to do with skill.
What is this all about?
About my investment history, wrong and right decisions, career paths and wealth accumulation with many diversions but without inheritance. You're not interested? I can understand that. Just keep scrolling.
Recently, inspired by @Simpson I recently benchmarked the current indices with my public (and real!) portfolio on getquin. The result for my portfolio in the mid 6-digit range surprised me somewhat.
The good guy @Alpalaka commented that it would be interesting to hear my investment story. No idea if he meant that seriously. Anyway, now he has to read it 😁.
The beginnings
The little donkey attended a secondary school in a small town and started an apprenticeship in IT at the age of 16. That was the first reason for my parents, who were at least involved in finance but only trusted their bank advisor, to drag me to various bank appointments, insurance companies, ... . Of course, I wasn't interested at 16, so I just did what my parents said. It looked like this:
I also had to give a few euros in "rent" to my parents. My gross salary of 600 euros in the first year of my apprenticeship was already largely used up 😭
But at least it was better than before. In the years before my apprenticeship, I received 10 euros pocket money from my parents. Per month. I earned some extra money by delivering newspapers. I probably also acquired my rather frugal lifestyle during this time.
The first big money and the first big panic
3 years later, I had successfully completed my apprenticeship and was taken on for around 26,000 euros gross per year. When I was 20, I also received the only major financial gift of my life: my parents had saved 10,000 euros for me ♥️. This went directly towards the purchase of a car. That made my long-distance relationship a lot easier at the time. And even though my parents' "rent" went up, I was now able to live large for the first time, treat myself regularly and save a few euros in my current account.
Until I decided to move out. Real rent is expensive. On top of that, there were additional expenses for furniture, food, a part-time degree and recommendations from my parents: more insurance (which you absolutely need...) and topping up existing policies (occupational pension, Riester for the maximum state subsidy, more in the building society, ...). At the same time, my salary has only increased marginally since the end of my training. That was the first time I really panicked. I was afraid that I wouldn't be able to afford to live independently. And at some point I got the feeling that I was simply completely overinsured and was putting far too much into Riester/building society savings. At this point, I decided to hopefully take a few mini salary increases over the next few years and not to adjust insurance/savings rates upwards under any circumstances.
Pirate Party and Bitcoin
In my twenties, the Pirate Party made its grand entrance as a protest party in Germany. Unfortunately, it was then replaced by the AfD. But that's not the point here. In any case, the donkey was still young, rebellious and wanted to improve the world with his idealism. The Pirates came along just in time. They loved freedom and I was one of their supporters. All power to the people. More direct democracy. Down with the old system. With this mindset and my existence as an IT nerd, I was bound to stumble across Bitcoin.
In 2011, the time had come. I don't remember how, but somewhere I heard about it for the first time $BTC (+0.12%) and was immediately fascinated. I had no idea about the technology (although I was an IT specialist) and also no idea about finance and economics. But I knew something had to change. And the promise of Bitcoin just sounded too good. So I set up an account with the largest Bitcoin exchange in the world at the time, Mt. Gox, and bought around 300 USD worth of Bitcoin. That was all I could and wanted to invest at the time. I also mined a few sats on my laptop.
Price fluctuations and my Bitcoin exit plan
In the early days of Bitcoin, daily price fluctuations of 5-10% were quite normal. As an IT specialist, I programmed software to recognize patterns in the Bitcoin price and started day trading - again without any sense or reason, of course. I had no idea. But because the fluctuations were so high, I was able to take some profits. In the meantime, however, the price plummeted to such an extent that I lost interest in Bitcoin (and the Pirate Party).
Fun fact at this point: As I am used to the fluctuations of the early Bitcoin market, I am not very interested in fluctuations on the stock market today. Years later, when I started to get involved in the stock market, I heard on the news that the DAX had collapsed. I expected it to fall by at least 30% in one day and was almost disappointed when it actually only went down by a good percent 🥲.
When Bitcoin prices rose sharply again in 2013, my interest returned. At some point, I had turned the 300 USD into just under 10 Bitcoin and 1,000-2,000 USD. At this point, I came up with a megalomaniac plan. My Bitcoin Exit Plan:
I wanted to sell one bitcoin at every 1 and every 5 at the beginning of the price. So one at 100 USD, the next at 500 USD, then at 1,000 USD, 5,000 USD, 10,000 USD, 50,000 USD, 100,000 USD, 500,000 USD and 1,000,000 USD.
And I would have stuck to this plan. Unfortunately, my own stupidity got in the way and I lost everything. Twice 🤦. You can read how it happened in part 2: https://getqu.in/Ptei6g/
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