Random Musings: On debt and stimulus

Have just started reading Big Debt Crises by Ray Dalio two days ago. For those who aren't aware, it is a 480 page tome, (๑･▱･๑) which will take at least a number of weeks to smash through, let alone digest the insights, but reading the first part of the book gave me some time to ponder the debt crisis that I had lived through, specifically the GFC which Australia emerged out of relatively unscathed.



It was on this point that I was having a discussion with my colleague Mr A today, who remarked that when Labor passed the stimulus package of February 2009 which famously handed out $950 per person was widely criticized by the liberal party but 10 years on in the face of another potential recession, the Morrison Government passed their tax cuts which essentially did the same thing. It is however noteworthy to highlight the differences, in the two situations though. Back in 09, the world was thrust into a financial crisis of significant magnitude whereas we appear to be currently facing a slow burnout. Secondly, the stimulus package from 09 also ensured that those who were most likely to spend the money immediately (i.e. those on welfare or aren't working) had received the payment, whereas the Morrison Tax Offset only comes into play for taxpayers on $37,000 and above. There is no wonder why the tax break didn't bring the intended effects to consumer spending.

With that in mind, I have to give credit where credit is due, and although I have definite disagreements with Wayne Swan on his morals and ethics pertaining to the subsequent leadership debacle(s), one cannot deny that he was a brilliant treasurer who navigated the country out of a precarious debt situation.

I can only hope that when the next crisis does come, I will be educated enough to navigate a safe path for myself and those around me. Until then, I will keep reading. (๑•́ ω •̀๑)

By 小福

Random Musings: On character and competitiveness

Human nature is one of the few things that I have developed a life long passion for. There are few things that bring me as much joy as observing how different people respond in a variety of manners to the same stimuli.（〃・ω・〃）

Having embarked on this journey of personal investing, I have found it to be surprisingly interesting to observe how other people make their decisions an the reactions they have from the subsequent results.

As such, I consider it noteworthy to narrate a certain saga that had occurred before me quite recently, more or less in response to my ボーイフレンド's current state of affairs and the reactions of two colleagues, Mr A and Mr D. It is without a shadow of a doubt to me that Mr D is the more intelligent and accomplished of the two, but with a streak of competitiveness and a desire to outperform others, he has of late undertaken a number of risky ventures without due consideration, some of which have resulted in bad outcomes which have put him further away from where he wanted to be. Coupled with an inability to accept good counsel when offered, this has drawn him down the dark path of inevitable destruction (or at least perpetual unhappiness)（￣＾￣）. By contrast, Mr A who I consider to be less smart, but aware of his shortcomings, of good character and sincerity had been inspired to do better and undertaken several small but significant adjustments to his lifestyle with a slow and steady approach to securing his financial future without a hint of bitterness but genuine desire to further his goals ヾ(｡･ω･)ｼ. It would appear to me that even though after several decades, Mr D may still amass a greater fortune than Mr A, there is no question of who would attain a greater quality of life.  One can only hope Mr D sees the light before it is too late. ¯\_(ツ)_/¯

In closing, it cannot be overstated enough the importance of staying humble and pursuing your life and goals at your own pace, without being misguided by the green eyed monster. Seeing someone who has achieved greater than you can be used a s a source of aspiration and motivation to extend yourself and do better, but if it leads you to irrational decisions in a bid to attain superiority, then a self aware individual ought to identify and cease this behaviour, for only with self reflection can we recognise and overcome our own demons. (*•̀ᴗ•́*)و ̑̑

“Rule 4. Compare yourself to who you were yesterday, not to who someone else is today" 

- Jordan Peterson's 12 Rules for Life.

By 小福

Achievement Unlocked! First Dividend

So there has been quite a bit of fluctuation on the stockmarket in the last couple of days. Daily ups and downs have easily come to a couple days salary on my part. It has been a learning experience, to say the least, in my moderating my actions and reactions to these movements. _(:3」∠ )_

More than once, I've had friends and co workers say to me "The market is up, let's go eat out at somewhere nice tonight" for me to reply "Its not a true earning until you cash out, and even then, the tax man has to take a cut first". As anticlimactic as it sounds, I dont think that you can really consider yourself as having earned the money until it has been liquidated.

Anyway, the point though is that coming home from work today, I received a nice surprise in the mail (๑•̀ω•́๑). My first dividends ever *\(^o^)/*. So although I can't consider market volatility as being my gains, dividends are most certainly mine.

Will I go out and get a nice dinner with it though? No. Will I be a sensible girl and reinvest it in the market? Also no 乁( ˙ω˙ )厂

I already went and spent it all on a birthday gift for my ボーイフレンド , in my opinion, the best investment of them all.

By 小福

Book Review: The Intelligent Investor - Benjamin Graham

I guess I will start off the first substantial post with a quick note on one of the first books I read when embarking on this journey, being the Intelligent Investor, by Benjamin Graham. Apparently this is known to be the bible of investing, and Graham is known as the father of value investing.

So my understandings of value based investing based upon reading the tome over the span of three weeks was largely about the importance of purchasing large common stocks when they are undervalued or have fallen out of favour with the general public. Paramount to this is asking yourself every time before you buy something whether or not you are getting good value for money and whether or not the asset you purchase is safe enough to retain value or has the potential to crash into oblivion.

Another albeit obvious finding that it pointed out was the duality of identity that comes with stock ownership. Simply put, when one becomes an owner of shares, you become a part owner of a business on one hand and also the owner of a (hopefully) appreciating asset. More than not it would seem that most investors tend to focus on the second identity and often forget the first. It just so happened today that I was reminded of this when I received a voting form in the mail today, the first I had ever received, which reaffirmed to me that as much as I hold very little to make much difference in any voting outcomes, it is still a good reminder that in making that purchase, I probably ought to take a stronger interest in the prosperity of the business whilst I still hold the equities.

Although these aren't particularly sophisticated or groundbreaking insights, they make for a solid foundation that I hope I do not forget in the pursuit of this venture.

By 小福

First Post

In this blog, I aim to discuss my learnings and insights as I learn personal investing.

Initially, I had little intention to start writing on this topic, but my ボーイフレンド  was fairly persuasive on this matter and I consider it to be a good opportunity to go back and reinforce things that I learn and to document my evolution in thinking.

As I read books and gain experience on the subject, I will update on my thoughts, opinions and reflections on the matter as I progress with my studies.

For anyone wondering why cappuccinos, I just really enjoy coffee (๑•̀ᄇ•́)و ✧

By 小福