Comments on: Problems with Constant Compound Interest (4) (and more) http://alephblog.com/2009/11/24/problems-with-constant-compound-interest-4-and-more/ Helping Institutions and Ordinary People Invest Better by Focusing on Risk Control Thu, 18 Mar 2010 20:53:26 -0400 http://wordpress.org/?v=2.8.4 hourly 1 By: carol http://alephblog.com/2009/11/24/problems-with-constant-compound-interest-4-and-more/comment-page-1/#comment-23769 carol Wed, 25 Nov 2009 13:06:05 +0000 http://alephblog.com/?p=2159#comment-23769 ¨They {i.e. banks} are lending to collapse capacity through takeovers.¨ E.g. an oil refining company taking over another refining company and than mothballing the previously competing refinery. Comparable to C4C and municipalities destroying houses in foreclosed neighborhoods. But does it really make sense to pay/borrow for a hostile takeover to mothball/destroy capacity? ¨They {i.e. banks} are lending to collapse capacity through takeovers.¨

E.g. an oil refining company taking over another refining company and than mothballing the previously competing refinery. Comparable to C4C and municipalities destroying houses in foreclosed neighborhoods.

But does it really make sense to pay/borrow for a hostile takeover to mothball/destroy capacity?

]]> By: Matthew Shilts http://alephblog.com/2009/11/24/problems-with-constant-compound-interest-4-and-more/comment-page-1/#comment-23767 Matthew Shilts Wed, 25 Nov 2009 12:34:25 +0000 http://alephblog.com/?p=2159#comment-23767 Hi David. Really liked this post. It is something that I have been struggling with for some time now. I find myself very unsure what to do with excess capital in order to preserve it for later retirement. Commodities are very attractive because they offer easy access to a market with world wide demand. This world wide demand provides me with a great inflation hedge. The trick is finding an investment vehicle that allows me to earn a decent dividend in the mean time yet avoids carry costs (ie storage etc). I may sound crazy, but I have settled on buying productive farm land as my preferred investment vehicle. The obvious downside is what happens if crop prices crater (always a possibility), but that seems no worse than the ups and downs of the stock market. I'd love to hear any other ideas your readers have on interesting investment vehicles that avoid many of the issues you mention in your post. (please not gold) Matthew Hi David.

Really liked this post. It is something that I have been struggling with for some time now. I find myself very unsure what to do with excess capital in order to preserve it for later retirement.

Commodities are very attractive because they offer easy access to a market with world wide demand. This world wide demand provides me with a great inflation hedge. The trick is finding an investment vehicle that allows me to earn a decent dividend in the mean time yet avoids carry costs (ie storage etc).

I may sound crazy, but I have settled on buying productive farm land as my preferred investment vehicle. The obvious downside is what happens if crop prices crater (always a possibility), but that seems no worse than the ups and downs of the stock market.

I’d love to hear any other ideas your readers have on interesting investment vehicles that avoid many of the issues you mention in your post. (please not gold)

Matthew

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