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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Haim R. Branisteanu who wrote (43297)	12/1/2008 12:33:55 AM
From: elmatador	Read Replies (1) \| Respond to of 219680

I have been ZERO debt AND minimum six months pay in the bank since April 1976. Here's how it started. I had an accident pole climbing on top of a microwave tower mid March 1976. Then I believed in social security saftey net. Brazil had implemented just about that time. It must be noted that I earned little money then at the beginning of my career. Doctor told me more than 15 days to recover, I went out of Philips payroll into social security. That meant end of the month I wold not be paid by Philips but by the institution. It was to be paid, 5 weeks in the future. Besides the pat would be only 75% of total income That meant at the end of the month I had 1/2 of my pay of the month of March I had worked. In total I had 9 weeks to go with very little money. But I was getting ready to marry first time and had savings in the bank so it was no problem. But I imagined me with kids, with an accident, with bills to pay, rent or mortgage and that created enough fear for me to decide that I will always will have six months of pay in the bank. And I did it ever since. It started when I was walking back from the doctor and something struck me -I can even recall today the exact place I was walking- in Brazil you need to have money. If you don't have money and you think there's a safety net you are in trouble. It always felt good, to ask for discount by having the cash in hand. I used credit 3 times: I bought mny first apartment with 50% up front (1979). I have bought my first car, with 70% up front (1977). And I used a credit facility building my house, deferring payment from end 2006 to begining 2007. That was it. I will never ever go in debt. The banking system attending the personal needs of people can go to the moon today, it doesn't make a difference to me.

To: Haim R. Branisteanu who wrote (43297)	12/1/2008 1:12:35 AM
From: elmatador	1 Recommendation Respond to of 219680

Debt to invest vs debt to consume. That's a big difference between the two. The first is what you said, with zero debt you cannot progress without importing other people's savings to build your infrastruture that generetes a return to pay the principal and the interest. The second is importing other people's savings to spend and get a standard of living your income does not warrant. In the first case is Angola here: they import Portugal, China and Brazil' capital to re-build the country. But even if that is their intention, if they execute their plan badlly, they will end up indebted, fleeced and without the improvement they spent their money on. That is what happened to Brazil's late 60's, early 70's development push which left them indebted, fleeced and returned to where they started. In the second case, you will always be sent back to where you started when you use other people's money to live a life your income doesn't warrant. Staying with the second case: even if you think you are actually investing, and not consuming, you will be sent back if you overplay your hand. That's the case of housing. A house to live inside it, is consumption -TJ started- it is not an investment. Because you are not going to sell it, move to Equador. Because there, in Quito, you will have to pay for a new abode. As TJ stated, only if you rent the home country home, and buy another one in Equador, it is considered na investment.