I’m late to the party as you said and I would like to increase both my stock equity portfolio and bitcoins assets during this recession (I’ve missed 2009 opportunity).
39 years old. Part-time doctor. medium COL area in Europe. Annual expenses 70k and annual saving 60k.
Total Annual revenue 130k € post-tax :
-112k medical practice.
-7k side internet business (started 1.5 years ago and still grinding and iterating).
-11k rental revenue.
Total net worth: estimation 975k €
-Rental real estate 380K
-Principal residence flat 220k
-Emergency cash fund 200k not to be touched.
-Cash allocated to developing side business 40k
-Cash for 2020 downturn investment 75k
-Stocks 40k since 2018 ( 20% ETF – 80% diversified value companies) down 37% now.
– Physical Gold: 3k
– Bitcoin 11k
– wine:6k
Of course, priorities are health, maintaining my medical practice and skills and developing a side business, but I’m wondering about investing 75k € during this market recession : ( betting on V recovery instead of a Japanese-like endless stagflation scenario)
25 k DCA in bitcoins.
50 k to buy “cheap” equity of major companies who fell to their 2009 price ( Boeing, Total, BP, Dutch Shell, Renault, Daimler, BMW…)
I would like to have your advice please, what would you do in my case?
Grateful for your blog.
Merci beaucoup WSPs.
You seem to be in great shape? not sure what your question is. Gold and crypto holdings look small relative to rest but other than that you appear to be set?
Maybe take some future earnings and buy those two since you’ve already got a lot of cash
Currently in a sticky situation. To cut costs, I’m living with roommates who give no shit about the virus. I’m taking all the necessary precautions (zinc, social distancing, work from home) however the risk is there.
Should I:
– Stay to cut cost for the impending recession.
– Find a studio and move out in case the virus hit again this winter (will result in cost hike)
Sounds like you’re young, so you should probably find more mature people as roommates and move out in the future
If you can easily afford a studio then go for that (much bettter)
Just don’t panic rent a studio if you can’t afford it, never know how the economy looks after something like this. Seems like best option is new roommates who are smarter more mature etc.
Thanks.
Since I bought 2 products it would be great if you can answer another question.
What’s your prediction on when the dust will settle and the virus starts to die down?
2 months is our best guess today. Unclear if it works but we do know people are incredibly foolish right now (still) thinking it’s not a big deal. It is.
I live in NYC. Is residential real estate worth investing in NYC for rental properties?
Crazy expensive compared to other areas. Is the price worth it or better off finding a few properties in the Austin Seattle area?
For RE the answer there is if you’re going to live there forever. Owning is fine even in low cap rate areas… for renting it only makes sense if you can miraculously buy the bottom.
Your second option is better if you have people you trust to manage it. Again, this is more of a macro call, if the prices suddenly drop it might actually be a good time to buy distressed assets in NYC shortly.
Stay in software sales or go to top engineering school to switch careers?
Almost 22 years old
No college degree
Decent numerics? childhood math whiz (top 1% in every year in elite maths competition), slacked off in high school but grades still good enough to enter country’s top engineering school
1.5 years in entry level software sales (SDR), good results, ~100k/year. I’ve realized that sales income is heavily dependent on market conditions/company and luck – I am stuck in Australia (smaller market less money) and cannot immigrate due to no degree.
Should I go back to top tier college in September and get a 3 year computer science degree to pursue silicon Valley or sales engineering? Income will be guaranteed
1/125, 3/175, 6/200, 9/250 minimum, but I will be 25 and have 0 savings when I graduate.
If you can get a high paying career just take that stop juggling
After that go and start a biz, same thing as efficiency no change (never will be a change)
Young man in entry level software sales for mid sized company
If someone has been the the biz for 8 years+ and still unfit, making <175k, has 1 income source should I simply ignore all advice from them? Same for anyone who gives me unsolicited life advice?
Your call, we don’t know who these people are
Best way in your opinion to gain exposure to gold (physical, ETF etc.)?
Just buy small physical gold
Thanks, appreciate the response
Why physical gold vs holding an ETF? Just more of a hedge against inflation than converting ETF holdings into dollars if we get into a hyperinflation scenario?
Current crypto holdings are ~15% of Net Worth, would you consider this on the higher the end for a younger person 23 years old (risk-on), trying to establish the maximum bound of exposure
1) physical gold is always better, VERY small amount since its basically insurance. No need for paper gold
2) seems fine you’re 23 this event won’t even be relevant to your future honestly you have too much time on your side
Given your opinion of Stagflationtion or Hyperinflation, regarding Enterprise Sales which would you want to be positioned in:
1) Human Capital Management SAAS sales (pure tech)
2) BPO- Payroll/Benefits/HR Outsourcing (tech with people support)
3) Contractor/Freelance Management SAAS (gig economy tech platform
1) HCM space has grown rapidly in last 4 years. Crowded but essential
2) outsourcing is mature but much fewer competitors that can do in HCM
3) new space and concept. Targets gig workforce exclusively. No direct competitors closest would be upwork. Think uberizibg your workforce.
I love to hear thoughts on where to lean in what to avoid etc
That is extremely hard, we wouldn’t do any of those actually we’d go sell expensive enterprise equipment like servers. Since Data Centers are going to be around forever unless the internet dies.
Of those three none of them matter actually, you want to work with the largest company that is the most successful. Think in terms of scale not proposition
I’m not from the US, my holdings are mainly in CAD & EUR. They’ve already dropped quite a bit. Should I convert everything to USD?
This is a very tough situation, in that case since you’re not a US citizen we would put part of the money in USD and gold/crypto no matter what.
Too hard to help since we don’t know what your spending needs are but it would be wise to diversify some of your currencies at minimum
Going all in on anything (as we learned in every down turn so far) doesn’t age well
If buying precious metals do you view physical gold significantly different than something like GLD ticker? If so, why?
Physical gold is held by you, GLD is held by someone else…
Understand that, but if high net worth even 1% in gold is more than I want to be holding in my house. Guess a lockbox would be required. Seems like the only case physical gold would be required would be if there was a total financial collapse. In that case, I wonder how much access I would have to the lockbox at the bank. Might be closed. Essentially, someone else holds my physical gold either way.
Yes so you have to come up with a creative way to hold a reasonable amount yourself that is physically accessible.
Trump has at times hinted at refinancing the debt in speeches and sometimes appears to have preference to go back the gold standard.
What would be the repercussions if Trump decided to refinance the debt and tell then debtor’s you’re only getting paid back half like he once hinted at a campaign rally.
And what you foresee happening if he tried to implement a gold standard.
We have no idea on this one, haven’t looked into his statements that much. Feel free to ask something else
Do you see much risk of hyperinflation at this point? You Recommend being cash and crypto heavy at this point in time as well as PMs. My concern is holding too much cash if and when hyperinflation hits. Are there signals to lookout for of when you want to get out of cash before it becomes worthless
Yeah if we go through a “v-shape” and prices begin to accelerate rapidly it’s time to get out of cash
Hi WSP Team – Thank you for your precaution threads on what’s happening. Should housing feel this outbreak impact by about 3Q 2020? Based on Spending prices would potentially go down by 20 to 30 points. This means even middle class in B neighborhood (larger homes 30 minute to major city) would be moving out.
Too early to tell at this point, real estate prices should be falling like a rock right now.
So it will depend on how the government gets cash to the people. Our general view is negative near-term based on current actions.
They could just turn to large inflation which would raise the value of the properties and allow rents to be the same. But then need a policy to force companies to pay more (very hard situation they are in)
Bought the spending book but can’t find tracking number.
I tried buying some dumbbells for a home gym because of this situation. Can’t find dumbbells or kettlebells anywhere. Everywhere you go it sold out. I’m already losing my cardiovascular fitness due to being on lockdown. Dont want to lose my muscle gains. I have great size for my height but might close a lot of it by just doing bodyweight stuff if the gyms stay closed for a very long time. Any suggestions? Thank you for keeping us updated.
you can do things like burpees for cardio?
For heavy items you an find large objects to lift and have to do it as makeshift workouts. Unfortunately doesn’t sound like you were prepared so you’re going to have to wait it out… Sucks but it’s how life works
best friend’s father owns a gas station in a dilapidated area working 15h/day alone with the mother. walmart and bigger gas stations have been built east and west, lowering sales—worsened due to the virus.
father is well known for his burgers that he sells cheaply. I suggested that the father take advantage and sell essentials, markup the burgers, and get out asap, but people do not want to buy the shop now, and at best offered 75% of the original cost pre-pandemic. also can’t make burgers while running the register.
father does not want to make my friend work because he is studying engineering with 3 years left and does not want him sick. the mother is an accountant and works on the side, looking for one more certification, but can’t because she’s working.
any advice is appreciated, thank you.
This sounds like an awful situation and we’re sorry to hear it. We have no idea on how to fix this, if you can make money by selling food do it.
We can’t offer advice as we don’t know, the best we can say is do anything you have to do to keep cash flows positive?
Terrible situation and we’re sorry once again. Just don’t know how to fix that one…
thank you for the kind words. we can share our plan if you’re interested:
we’re both studying engineering with courses in business and programming. will take your advice on moving into tech and try to work as quants at a bank. I’m keeping your advice “creating a business is your 1st priority” in mind. may spin data science or machine learning skills into something once we graduate, such as a course or a blog and leverage it for affiliate marketing.
currently taking this extra time to earn some programming certificates from online courses. will apply for internships at banks, tech/consulting firms.
if parents end up bankrupt, we can keep them in our dorms and do our best to stay alive until graduation.
2 questions — After reading your last post on the current situation you made a comment that a V shape recovery is overall bad because middle class losses out.
Still confused on this point.
What is the best case scenario for recovery within the market if it doesn’t involve a V shape bounce back?
Also, how could a cash flush hustler take advantage of the given chaos?
which question do you want us to answer there are like 3 in here.
Apologies for that.
What is the best case scenario for recovery within the market if it doesn’t involve a V bounce back?
AS of today’s writing it is inflation or a recession that’s really it.
1. Credible sources at SaaS company I work for says no layoffs will happen (at least for next couple months). Gut feeling trust it?
2. Small ecom store, obviously not right time to ramp up and scale now, but would a couple weeks be fine? Non-essential product, advertising on FB and Google, product from China. Gut
feeling is once things flatten out, great time to expose market, low CPM on ad platforms, people psychologically want to “spend” and impulse buy to feel better…thoughts?
3. Not even close net-worth wise to invest big (need to work on cash flows) – but since market is in a place we won’t see for 10 years, do I go all in on the market (stocks, btc), but growing ecom has chance of slowing down if that.
1) sure could be true we don’t know what company it is. Some companies are benefitting from this
2) Our opinion doesn’t matter, you want for dust to settle and then test demand and see if it works or not
3) No. we already covered this 5 times the last 3 weeks
When did you incorporate a company? Did you just start doing the side hustle from your personal bank account/under your personal name, and then only bothered incorporating further down the track? Or did you incorporate right away before doing anything?
Reason I’m asking is because I don’t want to be the director of the company because I don’t want employers running background check and asking questions as to why I’m a director of this company. So I asked my family to be the director/shareholder for me.
But I”m having a hard time opening a company bank account. Banks want proof of what “business plan” is – I don’t know how to say: “I don’t know man, I just want the corporate veil protection first, I’ll figure what I actually want to do later as I keep experimenting…”. Even harder to get my parents to say that to banks.
Strictly speaking, mixing of funds would mean that I would have no corporate veil protection. But is that really that big of a problem…lack of corporate veil would only really hurt me if my business was ever in debt (which I don’t think it will be anyway…)
This has been covered many times in the past. Put biz and ownership into family member name. good to go
Once the US is officially in a recession, would you then recommend to start buying small cap stock indexes?
we’ll announce when we think its okay to add.
We understand that you’re only in Crypto and Cash at the moment. From your last article you stated that you’re not buying one single stock. Will that change depending on the market, and if so when do you plan on buying more stocks? We are now all in cash and are looking to copy your investment strategy going forward. Cheers.
we’ll announce when that changes
43, married with kids, own house outright. Hit my number but took a 20% hit these past couple of weeks with everything (including bonds) getting sold hard. Pay the bills with investment income (no 9-5).
Trying to wrap my head around what’s the right % of NW in crypto.
Your math that supports owning 5 bitcoins and/or 1% of NW makes sense as a hedge, but will not maximize upside.
I’ve seen you write up to 10% of NW but that seems aggressive for 40+.
Any thoughts?
It just depends on your personal net worth. Crypto and gold are “insurance” so exact units don’t work with big numbers
10% exposure? That’s not the right question. 10% exposure when you’re worth $500K is irresponsible, 10% when you’re worth $500M is totally fine, since you’re incredibly wealthy already
-) Anything particularly useful to do to make use of the current extra time as a 21y old university student?
-) Does the current crisis change any of your long-term recommendations as far as important skills to learn for career/business?
Thanks for your time.
1) Learn sales 100%
2) It makes us much more negative on financial services as a career, tech and sales is where you should lean
How can I safely store my cryptos? I have struggle trusting $100k to a usb drive, be it ledger or trezor. What is your opinion on titanium seed wallets? How safe is coinbase hotwallet?
Bought, read and loved all 3 products.
Your question is already answered in the book. You use a hardware wallet unless you are going to buy/sell shortly.
What do you do when you’re about to start a side hustle (but you don’t know what your business plan is because you’re planning to just try everything and see what sticks) and you’re trying to open a bank account? I have a company incorporated, but IDK what to tell banks when they ask me for the business plan of the company when I’m opening the business account, cuz IDK what the business plan is either.
But I definitely want to open the business account first before doing anything (eg registering domains), in order to get corporate veil protection.
This doesn’t make any sense at all. Test demand using whatever checking account you currently have.
Why would you waste your own time opening an account with no business no revs no strategy? just wasting everyone’s time including yourself
Legally you only get the benefit of a company (where you’re not personally liable for debts if creditors go after the company) if you never mix your company’s funds with your own personal funds. Which is why I want to open a separate bank account just for the company, so that I never mix the funds I use for the company (eg buying ads to test demand) with my personal funds
Earlier in the QA, you recommended buying small physical gold. Isn’t selling physical gold difficult? That is, due to the concerns over the authenticity of the physical gold, don’t you take a significant cut when selling? Is gold therefore recommended as a hedge against ‘doomsday’ scenarios?
The whole point of owning gold is you assume you never sell it and never have to. So yes it’s a hedge against a complete disaster which is why you shouldn’t care if it’s harder to liquidate.
Question on which currency to store value in (cash and bank account), given that I’m based in Europe, Poland (we use local PLN currency here, the country is a part of the EU but never became a part of Eurozone).
We see USD and EUR exch. rate going up, yet I assume recession (and ultimately inflation) will affect both local as well as global fiats, such as USD/EUR.
What would be your advice for the upcoming 1-2 years?
Thanks in advance!
If you force us to choose you want to be long the dollar in fiat terms for now. 1-2 years is in limbo right now, we’re doing research on distressed commercial real estate in texas.
Sold all crypto Mid Feb (mid 7 figures), then put it all in the VXX. Call it luck I guess. I’m all cash now with a 4x higher net worth. Question is:
What color lambo do I get and how do I airlift in god-tier Colombian whores with the shutdown?
Actual question: Put it all back in crypto (ETH & LINK) save for $5m, or is this retarded?
lol! If true congrats, honestly just stay diversified not a big deal. You’re gonna do what you’re gonna do if you made those wild trades
Recently moved to Miami after graduation(Chemical Engineering) for Data Science role, was layed off because of corona. Had recruiters reach out to me last week but everything has come to a fullstop.
Thinking of using these quarantine weeks to go full in to Software Engineering/Development. I think this will be the only unscathed industry for now, at least before the economy gets back to normal (if thats a thing even anymore).
Thoughts on this and advice ?
That is a smart strategy, learn another skill that can be monetized when we’re out of this situation. don’t wait
I am in the SWE industry and know someone who switched from ChemE to SWE.
I would focus on getting another job ASAP, unless:
1) You have reason to believe you are top 1-5% at SWE.
2) You can get into a top tier bootcamp
As for why, go on teamblind.com and read for 5-10 minutes.
@ someguy1776 So what’s your point ? What happened to your ChemE guy. I literally said no recruiter is responding since March 15th. No one is hiring and I have previous SWE experience as a Data Scientist (not top1-5 %).
Software Engineer, 2.5 years in. Currently, I’m working harder than usual to make sure I’m not on the list in case there are layoffs at my firm. The firm is still hiring so I think I’m OK, but I want to be sure.
I am fairly well liked politically and was one of the first hires at the startup, but is there anything extra you would recommend doing?
Right now the plan is to go to all the boring “after work virtual drinks” and check in weekly with my manager to make sure I understand what he’s working on (and then work like a madman to make sure his life is easy)
Sounds like you’re 100% fine, you’re doing everything right already. Just don’t piss them off with something social related (IE. don’t give opinions on politics, the virus etc.)
Awesome, thank you for taking the time
What is your opinion on the following :
– cold wallets like ledger or trezor
– titanium seed wallets
– coinbase
I find it hard to learn and trust cold storage, so I obviously have to read on them and use them more.
How about storing 1/10th of cryptos into 10 different cold storages?
Already answered.
What are best movements with dumbells during this quarantine?
Not sure what you mean here you can do basically everything with them, bench, lunges, arms, etc.. There is nothing special about doing them in your home or at a gym it’s the same
Thanks to your advice I saved up 24 months of living expenses in cash (way more than you guys suggested). It’s a great feeling not being stressed out at all during this period because of this buffer.
Question 1: Based on your previous post about staying liquid in cash and crypto, does that mean I should convert some to crypto? Always thought your stand was no investment until millionaire and I ain’t there yet.
Question 2: Assuming the answer to question 1 is yes (ie. Buy crypto). How much of the 24 months buffer should I convert to crypto bearing in mind your other requirement that we should always have 50k cash on hand for starting a side business?
Question 3: currently in the process of launching a product. Website development is done and moving on to testing demand. Given the local market is small, the intention is to sell abroad. However, overseas shipping cost from FedEx/UPS would eat too much into margins (negative profit) as it is classified as a hazmat product. How to approach this or should I abandon the idea?
Thanks.
1) if not a millionaire then think of biz ideas to launch when we are past this
2) It is not a yes, if you want it to be a yes, then maybe 6 months worth can be added (we assume you still have a job) since that leasve you with 18 months, more than enough
3) We have never sold a product like that, you always abandon ideas that don’t make money. Either make sure the numbers work, demand test it and move on.
Honestly these questions were asked entirely wrong: 1) how much do you need for biz? 2) how much do you need to survive 12 months now you know the answer to all your questions.
1. Started being more active with my father’s investments.. $330K EOY 2019 in mutual funds dropped to $225K as of Friday (significant amount for us). He wants to liquidate majority of it asap. Sit on cash for opportunity to buy RE / index funds + small caps closer to bottom. Thoughts? I know you’re against panic selling but the virus/economy seems like it’ll get worse.
(Was originally planning to liquidate most in 2020 for this any way but hoped to do it before such a sharp correction occured..)
2. Would you consider / advise moving elsewhere temporarily to avoid the virus/longer term quarantine? Taiwan, Singapore, HK, Japan etc. looks like they have it more under control and are still major cities.
3. How to find a great CPA? You recommended to find one that previously worked for IRS.. but having a hard time finding that (NYC). I assume just through word of mouth.. but figured asking as my last question just in case for any tips.
Thank you! Your books / blogs have helped me so much the past 3 years.
1) this is a decision for your family not for us. We’re not getting involved in that. Our investment advice has been on here for almost a decade
2) No unless you can afford to do it with no impact to revenue
3) Go find SMBs and ask them who they use, eventually you’ll find one that is “under the radar” and then you’re good to go
Thank you for all the great content all these years. It’s helped me tremendously.
1) How do you keep your brain clear during these times, so that you can think clearly and avoid stupid mistakes and take advantage of any opportunities that may arise?
Meditation is the best way to do it. It’s interesting seeing lots of readers/followers (the dumb ones) think we’re freaking out. We’ve been prepared for 2.5 years now so it’s been a good visualization of how little people know.
Opportunities will show up in about a month is our guess right now.
Recent grad with 24K in student loans. Not making ok money as a medical device sales associate. Trying to buy as much bitcoin as I can while at a relatively low price. Should I continue to do that or pay of my student loans first.
Won’t make a difference. You need more income streams do whichever you feel is best, numbers are too small
Will SP500 recover long term? My parents have a good amount of stock and I convinced them not to sell a large amount (cash not needed in the short term). I’m wondering if index funds are still going to be a good investment over the decade or if we should be looking into other areas.
The world will be better in 20-30 years for sure.
Totally understand the issue and reasons to not invest in stocks right now, but if I’ve been DCA Small cap funds for 6+ years and have a 30+ year timeframe, don’t see any reason to stop now except to try to time the bottom which is dumb.
26yo, live in south making 180k/yr with very low risk of losing income .
if your strategy is to DCA forever then you should never care about market cycles, perfectly fine strategy although all small caps is dangerous as principal grows
Yea for sure, will definitely de-risk as my worth goes up. Appreciate you guys a lot.
Was already invested in the market before I came across the blog and the advice of not investing if under a million net worth. (Currently 35 years old, 150k net worth, have some catching up to do).Would you recommend liquidating my stock positions if my cost basis is being met now(S&P 500 index and tech/ecomm stocks), not a “50-60% lower cost basis from way back in 2012-2016” as referenced in “The Last Round of bullets” post. Could free up 20-30k or just let it ride out.
Thank you for your contributions.
First wanted to thank you for the blog. Found y’all about a year ago although wish it was a few years sooner when I was still in college. Since 2019 transferred to a secure 6 fig 9 – 5 job from a boutique PE and now PE firm is shutting down while I’m making decent income and starting to work on 2nd income stream. Seems like a good choice rn.
Looking to buy some real estate so related question:
Do you think single family residential RE will take a significant hit due to this corona recession?
Our current guess is commercial real estate will be coming down FAST. But that’s the current expectation
Residential unclear, haven’t seen any fire sales relative to commercial RE which is imploding faster than we even imagined was possible.
So, how will this pandemic affect young people (I’m currently 20)? I know you guys aren’t psychics lol, but your predictions are usually right. Just like you guys recommended, I’m currently going 100% in learning copywriting and sales in general and trying to build a service based biz (which will be followed by a product based biz in the future).
Anything more I can do now in order to win in 5-10 years?
Honestly not much, that’s the best part about being young! It doesn’t matter. If you have zero and go to zero again…. no big deal.
No just follow the same path we outlined for 5 years!
Probability or mad-max scenario here or elsewhere?
Pretty much 0%.
Thanks for the recent posts, they were very useful.
I am 42, job in tech, no online biz or other side income yet other than some trading, $1M networth. Late to the party but motivated to change.
1) Significant 401k, HSA, trading account portfolio in cash. Find stocks critical to increase savings/net worth. How do you determine when to get back in stocks with high confidence (a strategy that doesn’t require protective put)? Would it be based on the CAGR you recommended? I will admit that my biggest fear is FOMO if stocks go up.
2) You don’t advice crypto for people 35+ and recommend RE instead. What is the primary reason?
3) Based on age (40+), are there any strategies like online biz or anything else that you would discourage for any reason?
1) same recommendations as the books. Nothing will change (ever). You should have some exposure to stocks due to 2010-2017 buys so don’t worry about it.
2) If you have more money, you want ways to have forced returns
3) No everything applies across all age groups. You must have 3-5 income streams by age 40. If not, get to creating.
Great content, bought all three of your books and it’s served me well.
I am debating taking another position at a different firm. Its more startup like and I would have equity compensation, the opportunity to invest, and potentially could get carried interest.
Current Comp is $500k in a mix of equity bonus and base (recent massive bump due to promo etc). Wife works as well and makes $100k.
In this wild time what should I set my floor at for jumping ship to the other shop? Current company is stable and should do well in this crisis.
Honestly probably not. But again you have to make that call based on how well you think the new firm would do.
Would you ever allow guest posters from other successful internet entrepreneurs? IE an eCommerce section if someone is verified figures?
Sure we’ve had guests before
1. Can you give my OCD ass some exact percentages of net worth to have in cash, crypto, and gold right now in case of a SHTF scenario?
2. Any difference from triangle investing in crypto currencies you are long on at the moment?
3. Any specific crypto currencies to focus more on for a SHTF scenario? (As opposed to triangle investing/answer to #2)
1) no because we don’t know your financial situation. If you’re worth $100M and can live off $50K a year (insane situation) then you could ramp up all high risk as much as you want.
2) No
3) No change.
I’m about to graduate college, so net worth is non existent. Not sure if having exposure in a SHTF situation takes precedence over an emergency fund but I have basically 6 months living expenses in cash and that’s it
what do you think of speculation on some of the smaller cryptos as a way to juice returns if there is a flood of capital into the crypto space? Since your recommendation in Triangle Investing is to invest in cryptos amounts the investor can accept a 100% loss, do you support the concept of 10-20 small bets on smaller cryptos for the change at extraordinary returns? If you support that concept, are there any in that space that you would recommend?
All recommendations in triangle investing.
None of that stuff matters its a 5-10 year play… you know actual investing not speculating on month to month nonsense
1.What is your faith in the supply chain for suburban cities in California/NYC over the course of the next 3 months?
2.Without giving equity, how do you guys get talented people to stick with you over the long run (more than 2+ years?)
3.How have the recent events changed the industries/spaces that are worth going into today? (What specific sectors or products would you NOT touch aside from financial services)
1) very high, necessities will be fine
2) You can’t, talent is expensive. If you get incredibly profitable then you pay them above market
3) Pretty much nothing except much more bearish on financial services and more bearish on conferences and more bullish on video games and software
Question on purchasing physical gold in Europe – do you have any Europe-based online equivalents of APMEX (suggested by one of your readers)? Otherwise shipping from the US (apmex) might mean paying additional taxes, based on the declared value of the shipment.
All the options (banks/ local dealers) are closed due to COVID situation.
Thanks in advance and good luck with your commercial RE search!
We do not know sadly as we don’t live in europe. There are gold bugs everywhere, find a few in europe and find a way to get a small physical amount and hide it for life
Any changes to efficiency in terms of starting a side income? I’m guessing a small (2k a month net to cover basic cost of living) CPG business is too small to really be affected by a recession?
24, 140k NW, 100k cash, 40k crypto.
I lost my high-paying job at a fintech startup, so #1 priority for me is to look for a new job. Also going through messy process with lawyers to get my equity (always get it in writing!) and a few months severance.
My financial technical skills aren’t top tier, but I do have some small boutique M&A experience as well as family office PE, at the fintech startup, I was an early employee who helped grow the business to a $26m valuation. so I should probably be able to get something in VC or at another startup. At this point, It seems my focus is to just make at least 100k from a job and focus the rest of my time on learning online sales
I’ve cut back expenses to 1k a month so I easily have 12 months living expenses + enough to start online business after getting into the swing of things at a new job . Yet I’ll also have 20-50k left over to invest in the coming months after the blood dries.
Should I even bother putting more into BTC at this point? Should I buy some gold? Wait for the dust to settle and get some stocks? I know my priority is to get a new job, I just feel bad having that much extra cash sitting around.
Same answer as above. No. You need an income and NO don’t invest unless you have as second income and are a millionaire. Wasting VALUABLE TIME
How likely are we heading toward negative interest rates and what’s a good asset allocation if that happens?
No clue. You cannot make that call at this time when things are declining by 10%+ per week. Is it a possibility? absolutely.
Wanted to first say thank you for the advice over the years, I have been following your blog since 2015 and it has truly made a positive impact on my life.
I’m 26, work in LMM private equity (about 1 year now) with 3 years of IB and have wanted to eventually transition to a l/s HF. Compensation will be higher but less time for side gigs (that I’ve had more time now that I work in PE; work/life has been great). My current role is pre-MBA unless otherwise noted (haven’t had that convo yet). Is it worth it to try to make the move? Realize you’ve already answered this generally, but given the likely push out to MBA and lower pay I feel like it’s the right move to eventually move to a HF. I just despise the idea of getting to 28/29 and being pushed out to get MBA where I could of already transitioned earlier. Surprisingly recruiters have been reaching out for analyst roles even through all the madness.
Side gigs are a subscription based biz (slowly ramping up) + a rental property.
1) you don’t have any questions here as you don’t have any outstanding offers. Stay employed and if you go to a Hf instead of staying in PE it won’t make a difference. Only thing that matters in those industries is performance of the fund.
2) the question we deleted the dollar amount you have doesn’t matter one bit, it’s about percent of net worth so it wasn’t even something we could answer. $1M is a lot to some and peanuts to others.
With the current drastic sell-off for oil, do you think it makes sense to invest a small portion in it?
Also, do you still consider investing into the S&P500 a wise decision in comparison maybe to investing in tech-stocks like Microsoft, Amazon, Google, maybe IBM (all due to AI focus)
1) do not know the industry well enough
2) We’re not buying any stocks at current levels still. If you’re going to try to time bottoms see our old post, find a way to protect against a big downswing worst case.
. You have mentioned that all ad spend should be cut.
If there is a business opportunity that
would actually improve as a result of COVID-19 do you think the opposite should occur? (as the cost of ads should reduce due to less ad spend)
2. What was your best trick to avoid having to go to “work drinks” as well as avoiding the mundane conversations about “what did you get up to on the weekend”? (I understand this is not as relevant now but for future reference)
3. Do you think the trend of further reductions in the price of cryptocurrencies is expected to continue as holders sell out to cover their living expenses (as COVID-19 gets more and more serious)?
1) yes our point is that if your conversions cost 400% more just cut it and wait. There are always exceptions to the rule
2) no tricks just don’t do it. Unless you’re worried about losing your job right now then keep up those politics games
3) It very well could go down, that is not the point. Hell we even wrote that right before it went from $8K to $4K and we bought at $4800 all verifiable on twitter.
what indicators are you looking for to know when time is to start buying stocks again?
Covered in spending
Me: Do you have any insight/commentary into ETF liquidity issues with the underlying assets? It seems many active managers poke at ETFs for not having proper liquidity measures in place.
WSP: “Yes it will blow up if panic selling begins since its illiquid and people will not be able to “dollar cost average”That one is clear as day, does it happen now? who knows.”
Me: So we’ve seen the impact on ETF liquidity and price movement with the last month. Is an ETF something you feel comfortable owning still? Does your advice change on buying the index (through an ETF) or would you advise individual stocks / mutual funds (assume you are at the number where it matters)? Or does it not matter if liquidity is gone because everything is screwed anyways?
Thanks for all you do!
What? Nothing has changed from our views see prior posts. When we are buying again we will say when.
I’m late to the party as you said and I would like to increase both my stock equity portfolio and bitcoins assets during this recession (I’ve missed 2009 opportunity).
39 years old. Part-time doctor. medium COL area in Europe. Annual expenses 70k and annual saving 60k.
Total Annual revenue 130k € post-tax :
-112k medical practice.
-7k side internet business (started 1.5 years ago and still grinding and iterating).
-11k rental revenue.
Total net worth: estimation 975k €
-Rental real estate 380K
-Principal residence flat 220k
-Emergency cash fund 200k not to be touched.
-Cash allocated to developing side business 40k
-Cash for 2020 downturn investment 75k
-Stocks 40k since 2018 ( 20% ETF – 80% diversified value companies) down 37% now.
– Physical Gold: 3k
– Bitcoin 11k
– wine:6k
Of course, priorities are health, maintaining my medical practice and skills and developing a side business, but I’m wondering about investing 75k € during this market recession : ( betting on V recovery instead of a Japanese-like endless stagflation scenario)
25 k DCA in bitcoins.
50 k to buy “cheap” equity of major companies who fell to their 2009 price ( Boeing, Total, BP, Dutch Shell, Renault, Daimler, BMW…)
I would like to have your advice please, what would you do in my case?
Grateful for your blog.
Merci beaucoup WSPs.
You seem to be in great shape? not sure what your question is. Gold and crypto holdings look small relative to rest but other than that you appear to be set?
Maybe take some future earnings and buy those two since you’ve already got a lot of cash
Currently in a sticky situation. To cut costs, I’m living with roommates who give no shit about the virus. I’m taking all the necessary precautions (zinc, social distancing, work from home) however the risk is there.
Should I:
– Stay to cut cost for the impending recession.
– Find a studio and move out in case the virus hit again this winter (will result in cost hike)
Sounds like you’re young, so you should probably find more mature people as roommates and move out in the future
If you can easily afford a studio then go for that (much bettter)
Just don’t panic rent a studio if you can’t afford it, never know how the economy looks after something like this. Seems like best option is new roommates who are smarter more mature etc.
Thanks.
Since I bought 2 products it would be great if you can answer another question.
What’s your prediction on when the dust will settle and the virus starts to die down?
2 months is our best guess today. Unclear if it works but we do know people are incredibly foolish right now (still) thinking it’s not a big deal. It is.
I live in NYC. Is residential real estate worth investing in NYC for rental properties?
Crazy expensive compared to other areas. Is the price worth it or better off finding a few properties in the Austin Seattle area?
For RE the answer there is if you’re going to live there forever. Owning is fine even in low cap rate areas… for renting it only makes sense if you can miraculously buy the bottom.
Your second option is better if you have people you trust to manage it. Again, this is more of a macro call, if the prices suddenly drop it might actually be a good time to buy distressed assets in NYC shortly.
Stay in software sales or go to top engineering school to switch careers?
Almost 22 years old
No college degree
Decent numerics? childhood math whiz (top 1% in every year in elite maths competition), slacked off in high school but grades still good enough to enter country’s top engineering school
1.5 years in entry level software sales (SDR), good results, ~100k/year. I’ve realized that sales income is heavily dependent on market conditions/company and luck – I am stuck in Australia (smaller market less money) and cannot immigrate due to no degree.
Income projections years/gross amount (k) :
Lucky: 3/200, 6/300, 9/450
Probable: 3/150, 6/180, 9/210
Unlucky: 3/150, 6/150, 9/175
Should I go back to top tier college in September and get a 3 year computer science degree to pursue silicon Valley or sales engineering? Income will be guaranteed
1/125, 3/175, 6/200, 9/250 minimum, but I will be 25 and have 0 savings when I graduate.
If you can get a high paying career just take that stop juggling
After that go and start a biz, same thing as efficiency no change (never will be a change)
Young man in entry level software sales for mid sized company
If someone has been the the biz for 8 years+ and still unfit, making <175k, has 1 income source should I simply ignore all advice from them? Same for anyone who gives me unsolicited life advice?
Your call, we don’t know who these people are
Best way in your opinion to gain exposure to gold (physical, ETF etc.)?
Just buy small physical gold
Thanks, appreciate the response
Why physical gold vs holding an ETF? Just more of a hedge against inflation than converting ETF holdings into dollars if we get into a hyperinflation scenario?
Current crypto holdings are ~15% of Net Worth, would you consider this on the higher the end for a younger person 23 years old (risk-on), trying to establish the maximum bound of exposure
1) physical gold is always better, VERY small amount since its basically insurance. No need for paper gold
2) seems fine you’re 23 this event won’t even be relevant to your future honestly you have too much time on your side
Given your opinion of Stagflationtion or Hyperinflation, regarding Enterprise Sales which would you want to be positioned in:
1) Human Capital Management SAAS sales (pure tech)
2) BPO- Payroll/Benefits/HR Outsourcing (tech with people support)
3) Contractor/Freelance Management SAAS (gig economy tech platform
1) HCM space has grown rapidly in last 4 years. Crowded but essential
2) outsourcing is mature but much fewer competitors that can do in HCM
3) new space and concept. Targets gig workforce exclusively. No direct competitors closest would be upwork. Think uberizibg your workforce.
I love to hear thoughts on where to lean in what to avoid etc
That is extremely hard, we wouldn’t do any of those actually we’d go sell expensive enterprise equipment like servers. Since Data Centers are going to be around forever unless the internet dies.
Of those three none of them matter actually, you want to work with the largest company that is the most successful. Think in terms of scale not proposition
I’m not from the US, my holdings are mainly in CAD & EUR. They’ve already dropped quite a bit. Should I convert everything to USD?
This is a very tough situation, in that case since you’re not a US citizen we would put part of the money in USD and gold/crypto no matter what.
Too hard to help since we don’t know what your spending needs are but it would be wise to diversify some of your currencies at minimum
Going all in on anything (as we learned in every down turn so far) doesn’t age well
If buying precious metals do you view physical gold significantly different than something like GLD ticker? If so, why?
Physical gold is held by you, GLD is held by someone else…
Understand that, but if high net worth even 1% in gold is more than I want to be holding in my house. Guess a lockbox would be required. Seems like the only case physical gold would be required would be if there was a total financial collapse. In that case, I wonder how much access I would have to the lockbox at the bank. Might be closed. Essentially, someone else holds my physical gold either way.
Yes so you have to come up with a creative way to hold a reasonable amount yourself that is physically accessible.
Trump has at times hinted at refinancing the debt in speeches and sometimes appears to have preference to go back the gold standard.
What would be the repercussions if Trump decided to refinance the debt and tell then debtor’s you’re only getting paid back half like he once hinted at a campaign rally.
And what you foresee happening if he tried to implement a gold standard.
We have no idea on this one, haven’t looked into his statements that much. Feel free to ask something else
Do you see much risk of hyperinflation at this point? You Recommend being cash and crypto heavy at this point in time as well as PMs. My concern is holding too much cash if and when hyperinflation hits. Are there signals to lookout for of when you want to get out of cash before it becomes worthless
Yeah if we go through a “v-shape” and prices begin to accelerate rapidly it’s time to get out of cash
Hi WSP Team – Thank you for your precaution threads on what’s happening. Should housing feel this outbreak impact by about 3Q 2020? Based on Spending prices would potentially go down by 20 to 30 points. This means even middle class in B neighborhood (larger homes 30 minute to major city) would be moving out.
Too early to tell at this point, real estate prices should be falling like a rock right now.
So it will depend on how the government gets cash to the people. Our general view is negative near-term based on current actions.
They could just turn to large inflation which would raise the value of the properties and allow rents to be the same. But then need a policy to force companies to pay more (very hard situation they are in)
Bought the spending book but can’t find tracking number.
I tried buying some dumbbells for a home gym because of this situation. Can’t find dumbbells or kettlebells anywhere. Everywhere you go it sold out. I’m already losing my cardiovascular fitness due to being on lockdown. Dont want to lose my muscle gains. I have great size for my height but might close a lot of it by just doing bodyweight stuff if the gyms stay closed for a very long time. Any suggestions? Thank you for keeping us updated.
you can do things like burpees for cardio?
For heavy items you an find large objects to lift and have to do it as makeshift workouts. Unfortunately doesn’t sound like you were prepared so you’re going to have to wait it out… Sucks but it’s how life works
best friend’s father owns a gas station in a dilapidated area working 15h/day alone with the mother. walmart and bigger gas stations have been built east and west, lowering sales—worsened due to the virus.
father is well known for his burgers that he sells cheaply. I suggested that the father take advantage and sell essentials, markup the burgers, and get out asap, but people do not want to buy the shop now, and at best offered 75% of the original cost pre-pandemic. also can’t make burgers while running the register.
father does not want to make my friend work because he is studying engineering with 3 years left and does not want him sick. the mother is an accountant and works on the side, looking for one more certification, but can’t because she’s working.
any advice is appreciated, thank you.
This sounds like an awful situation and we’re sorry to hear it. We have no idea on how to fix this, if you can make money by selling food do it.
We can’t offer advice as we don’t know, the best we can say is do anything you have to do to keep cash flows positive?
Terrible situation and we’re sorry once again. Just don’t know how to fix that one…
thank you for the kind words. we can share our plan if you’re interested:
we’re both studying engineering with courses in business and programming. will take your advice on moving into tech and try to work as quants at a bank. I’m keeping your advice “creating a business is your 1st priority” in mind. may spin data science or machine learning skills into something once we graduate, such as a course or a blog and leverage it for affiliate marketing.
currently taking this extra time to earn some programming certificates from online courses. will apply for internships at banks, tech/consulting firms.
if parents end up bankrupt, we can keep them in our dorms and do our best to stay alive until graduation.
2 questions — After reading your last post on the current situation you made a comment that a V shape recovery is overall bad because middle class losses out.
Still confused on this point.
What is the best case scenario for recovery within the market if it doesn’t involve a V shape bounce back?
Also, how could a cash flush hustler take advantage of the given chaos?
which question do you want us to answer there are like 3 in here.
Apologies for that.
What is the best case scenario for recovery within the market if it doesn’t involve a V bounce back?
AS of today’s writing it is inflation or a recession that’s really it.
1. Credible sources at SaaS company I work for says no layoffs will happen (at least for next couple months). Gut feeling trust it?
2. Small ecom store, obviously not right time to ramp up and scale now, but would a couple weeks be fine? Non-essential product, advertising on FB and Google, product from China. Gut
feeling is once things flatten out, great time to expose market, low CPM on ad platforms, people psychologically want to “spend” and impulse buy to feel better…thoughts?
3. Not even close net-worth wise to invest big (need to work on cash flows) – but since market is in a place we won’t see for 10 years, do I go all in on the market (stocks, btc), but growing ecom has chance of slowing down if that.
1) sure could be true we don’t know what company it is. Some companies are benefitting from this
2) Our opinion doesn’t matter, you want for dust to settle and then test demand and see if it works or not
3) No. we already covered this 5 times the last 3 weeks
When did you incorporate a company? Did you just start doing the side hustle from your personal bank account/under your personal name, and then only bothered incorporating further down the track? Or did you incorporate right away before doing anything?
Reason I’m asking is because I don’t want to be the director of the company because I don’t want employers running background check and asking questions as to why I’m a director of this company. So I asked my family to be the director/shareholder for me.
But I”m having a hard time opening a company bank account. Banks want proof of what “business plan” is – I don’t know how to say: “I don’t know man, I just want the corporate veil protection first, I’ll figure what I actually want to do later as I keep experimenting…”. Even harder to get my parents to say that to banks.
Strictly speaking, mixing of funds would mean that I would have no corporate veil protection. But is that really that big of a problem…lack of corporate veil would only really hurt me if my business was ever in debt (which I don’t think it will be anyway…)
This has been covered many times in the past. Put biz and ownership into family member name. good to go
Once the US is officially in a recession, would you then recommend to start buying small cap stock indexes?
we’ll announce when we think its okay to add.
We understand that you’re only in Crypto and Cash at the moment. From your last article you stated that you’re not buying one single stock. Will that change depending on the market, and if so when do you plan on buying more stocks? We are now all in cash and are looking to copy your investment strategy going forward. Cheers.
we’ll announce when that changes
43, married with kids, own house outright. Hit my number but took a 20% hit these past couple of weeks with everything (including bonds) getting sold hard. Pay the bills with investment income (no 9-5).
Trying to wrap my head around what’s the right % of NW in crypto.
Your math that supports owning 5 bitcoins and/or 1% of NW makes sense as a hedge, but will not maximize upside.
I’ve seen you write up to 10% of NW but that seems aggressive for 40+.
Any thoughts?
It just depends on your personal net worth. Crypto and gold are “insurance” so exact units don’t work with big numbers
10% exposure? That’s not the right question. 10% exposure when you’re worth $500K is irresponsible, 10% when you’re worth $500M is totally fine, since you’re incredibly wealthy already
-) Anything particularly useful to do to make use of the current extra time as a 21y old university student?
-) Does the current crisis change any of your long-term recommendations as far as important skills to learn for career/business?
Thanks for your time.
1) Learn sales 100%
2) It makes us much more negative on financial services as a career, tech and sales is where you should lean
How can I safely store my cryptos? I have struggle trusting $100k to a usb drive, be it ledger or trezor. What is your opinion on titanium seed wallets? How safe is coinbase hotwallet?
Bought, read and loved all 3 products.
Your question is already answered in the book. You use a hardware wallet unless you are going to buy/sell shortly.
What do you do when you’re about to start a side hustle (but you don’t know what your business plan is because you’re planning to just try everything and see what sticks) and you’re trying to open a bank account? I have a company incorporated, but IDK what to tell banks when they ask me for the business plan of the company when I’m opening the business account, cuz IDK what the business plan is either.
But I definitely want to open the business account first before doing anything (eg registering domains), in order to get corporate veil protection.
This doesn’t make any sense at all. Test demand using whatever checking account you currently have.
Why would you waste your own time opening an account with no business no revs no strategy? just wasting everyone’s time including yourself
Legally you only get the benefit of a company (where you’re not personally liable for debts if creditors go after the company) if you never mix your company’s funds with your own personal funds. Which is why I want to open a separate bank account just for the company, so that I never mix the funds I use for the company (eg buying ads to test demand) with my personal funds
Earlier in the QA, you recommended buying small physical gold. Isn’t selling physical gold difficult? That is, due to the concerns over the authenticity of the physical gold, don’t you take a significant cut when selling? Is gold therefore recommended as a hedge against ‘doomsday’ scenarios?
The whole point of owning gold is you assume you never sell it and never have to. So yes it’s a hedge against a complete disaster which is why you shouldn’t care if it’s harder to liquidate.
Question on which currency to store value in (cash and bank account), given that I’m based in Europe, Poland (we use local PLN currency here, the country is a part of the EU but never became a part of Eurozone).
We see USD and EUR exch. rate going up, yet I assume recession (and ultimately inflation) will affect both local as well as global fiats, such as USD/EUR.
What would be your advice for the upcoming 1-2 years?
Thanks in advance!
If you force us to choose you want to be long the dollar in fiat terms for now. 1-2 years is in limbo right now, we’re doing research on distressed commercial real estate in texas.
Sold all crypto Mid Feb (mid 7 figures), then put it all in the VXX. Call it luck I guess. I’m all cash now with a 4x higher net worth. Question is:
What color lambo do I get and how do I airlift in god-tier Colombian whores with the shutdown?
Actual question: Put it all back in crypto (ETH & LINK) save for $5m, or is this retarded?
lol! If true congrats, honestly just stay diversified not a big deal. You’re gonna do what you’re gonna do if you made those wild trades
Recently moved to Miami after graduation(Chemical Engineering) for Data Science role, was layed off because of corona. Had recruiters reach out to me last week but everything has come to a fullstop.
Thinking of using these quarantine weeks to go full in to Software Engineering/Development. I think this will be the only unscathed industry for now, at least before the economy gets back to normal (if thats a thing even anymore).
Thoughts on this and advice ?
That is a smart strategy, learn another skill that can be monetized when we’re out of this situation. don’t wait
I am in the SWE industry and know someone who switched from ChemE to SWE.
I would focus on getting another job ASAP, unless:
1) You have reason to believe you are top 1-5% at SWE.
2) You can get into a top tier bootcamp
As for why, go on teamblind.com and read for 5-10 minutes.
@ someguy1776 So what’s your point ? What happened to your ChemE guy. I literally said no recruiter is responding since March 15th. No one is hiring and I have previous SWE experience as a Data Scientist (not top1-5 %).
Software Engineer, 2.5 years in. Currently, I’m working harder than usual to make sure I’m not on the list in case there are layoffs at my firm. The firm is still hiring so I think I’m OK, but I want to be sure.
I am fairly well liked politically and was one of the first hires at the startup, but is there anything extra you would recommend doing?
Right now the plan is to go to all the boring “after work virtual drinks” and check in weekly with my manager to make sure I understand what he’s working on (and then work like a madman to make sure his life is easy)
Sounds like you’re 100% fine, you’re doing everything right already. Just don’t piss them off with something social related (IE. don’t give opinions on politics, the virus etc.)
Awesome, thank you for taking the time
What is your opinion on the following :
– cold wallets like ledger or trezor
– titanium seed wallets
– coinbase
I find it hard to learn and trust cold storage, so I obviously have to read on them and use them more.
How about storing 1/10th of cryptos into 10 different cold storages?
Already answered.
What are best movements with dumbells during this quarantine?
Not sure what you mean here you can do basically everything with them, bench, lunges, arms, etc.. There is nothing special about doing them in your home or at a gym it’s the same
Thanks to your advice I saved up 24 months of living expenses in cash (way more than you guys suggested). It’s a great feeling not being stressed out at all during this period because of this buffer.
Question 1: Based on your previous post about staying liquid in cash and crypto, does that mean I should convert some to crypto? Always thought your stand was no investment until millionaire and I ain’t there yet.
Question 2: Assuming the answer to question 1 is yes (ie. Buy crypto). How much of the 24 months buffer should I convert to crypto bearing in mind your other requirement that we should always have 50k cash on hand for starting a side business?
Question 3: currently in the process of launching a product. Website development is done and moving on to testing demand. Given the local market is small, the intention is to sell abroad. However, overseas shipping cost from FedEx/UPS would eat too much into margins (negative profit) as it is classified as a hazmat product. How to approach this or should I abandon the idea?
Thanks.
1) if not a millionaire then think of biz ideas to launch when we are past this
2) It is not a yes, if you want it to be a yes, then maybe 6 months worth can be added (we assume you still have a job) since that leasve you with 18 months, more than enough
3) We have never sold a product like that, you always abandon ideas that don’t make money. Either make sure the numbers work, demand test it and move on.
Honestly these questions were asked entirely wrong: 1) how much do you need for biz? 2) how much do you need to survive 12 months now you know the answer to all your questions.
1. Started being more active with my father’s investments.. $330K EOY 2019 in mutual funds dropped to $225K as of Friday (significant amount for us). He wants to liquidate majority of it asap. Sit on cash for opportunity to buy RE / index funds + small caps closer to bottom. Thoughts? I know you’re against panic selling but the virus/economy seems like it’ll get worse.
(Was originally planning to liquidate most in 2020 for this any way but hoped to do it before such a sharp correction occured..)
2. Would you consider / advise moving elsewhere temporarily to avoid the virus/longer term quarantine? Taiwan, Singapore, HK, Japan etc. looks like they have it more under control and are still major cities.
3. How to find a great CPA? You recommended to find one that previously worked for IRS.. but having a hard time finding that (NYC). I assume just through word of mouth.. but figured asking as my last question just in case for any tips.
Thank you! Your books / blogs have helped me so much the past 3 years.
1) this is a decision for your family not for us. We’re not getting involved in that. Our investment advice has been on here for almost a decade
2) No unless you can afford to do it with no impact to revenue
3) Go find SMBs and ask them who they use, eventually you’ll find one that is “under the radar” and then you’re good to go
Thank you for all the great content all these years. It’s helped me tremendously.
1) How do you keep your brain clear during these times, so that you can think clearly and avoid stupid mistakes and take advantage of any opportunities that may arise?
Meditation is the best way to do it. It’s interesting seeing lots of readers/followers (the dumb ones) think we’re freaking out. We’ve been prepared for 2.5 years now so it’s been a good visualization of how little people know.
Opportunities will show up in about a month is our guess right now.
Recent grad with 24K in student loans. Not making ok money as a medical device sales associate. Trying to buy as much bitcoin as I can while at a relatively low price. Should I continue to do that or pay of my student loans first.
Won’t make a difference. You need more income streams do whichever you feel is best, numbers are too small
Will SP500 recover long term? My parents have a good amount of stock and I convinced them not to sell a large amount (cash not needed in the short term). I’m wondering if index funds are still going to be a good investment over the decade or if we should be looking into other areas.
The world will be better in 20-30 years for sure.
Totally understand the issue and reasons to not invest in stocks right now, but if I’ve been DCA Small cap funds for 6+ years and have a 30+ year timeframe, don’t see any reason to stop now except to try to time the bottom which is dumb.
26yo, live in south making 180k/yr with very low risk of losing income .
if your strategy is to DCA forever then you should never care about market cycles, perfectly fine strategy although all small caps is dangerous as principal grows
Yea for sure, will definitely de-risk as my worth goes up. Appreciate you guys a lot.
Was already invested in the market before I came across the blog and the advice of not investing if under a million net worth. (Currently 35 years old, 150k net worth, have some catching up to do).Would you recommend liquidating my stock positions if my cost basis is being met now(S&P 500 index and tech/ecomm stocks), not a “50-60% lower cost basis from way back in 2012-2016” as referenced in “The Last Round of bullets” post. Could free up 20-30k or just let it ride out.
Thank you for your contributions.
First wanted to thank you for the blog. Found y’all about a year ago although wish it was a few years sooner when I was still in college. Since 2019 transferred to a secure 6 fig 9 – 5 job from a boutique PE and now PE firm is shutting down while I’m making decent income and starting to work on 2nd income stream. Seems like a good choice rn.
Looking to buy some real estate so related question:
Do you think single family residential RE will take a significant hit due to this corona recession?
Our current guess is commercial real estate will be coming down FAST. But that’s the current expectation
Residential unclear, haven’t seen any fire sales relative to commercial RE which is imploding faster than we even imagined was possible.
So, how will this pandemic affect young people (I’m currently 20)? I know you guys aren’t psychics lol, but your predictions are usually right. Just like you guys recommended, I’m currently going 100% in learning copywriting and sales in general and trying to build a service based biz (which will be followed by a product based biz in the future).
Anything more I can do now in order to win in 5-10 years?
Honestly not much, that’s the best part about being young! It doesn’t matter. If you have zero and go to zero again…. no big deal.
No just follow the same path we outlined for 5 years!
Probability or mad-max scenario here or elsewhere?
Pretty much 0%.
Thanks for the recent posts, they were very useful.
I am 42, job in tech, no online biz or other side income yet other than some trading, $1M networth. Late to the party but motivated to change.
1) Significant 401k, HSA, trading account portfolio in cash. Find stocks critical to increase savings/net worth. How do you determine when to get back in stocks with high confidence (a strategy that doesn’t require protective put)? Would it be based on the CAGR you recommended? I will admit that my biggest fear is FOMO if stocks go up.
2) You don’t advice crypto for people 35+ and recommend RE instead. What is the primary reason?
3) Based on age (40+), are there any strategies like online biz or anything else that you would discourage for any reason?
1) same recommendations as the books. Nothing will change (ever). You should have some exposure to stocks due to 2010-2017 buys so don’t worry about it.
2) If you have more money, you want ways to have forced returns
3) No everything applies across all age groups. You must have 3-5 income streams by age 40. If not, get to creating.
Great content, bought all three of your books and it’s served me well.
I am debating taking another position at a different firm. Its more startup like and I would have equity compensation, the opportunity to invest, and potentially could get carried interest.
Current Comp is $500k in a mix of equity bonus and base (recent massive bump due to promo etc). Wife works as well and makes $100k.
In this wild time what should I set my floor at for jumping ship to the other shop? Current company is stable and should do well in this crisis.
Honestly probably not. But again you have to make that call based on how well you think the new firm would do.
Would you ever allow guest posters from other successful internet entrepreneurs? IE an eCommerce section if someone is verified figures?
Sure we’ve had guests before
1. Can you give my OCD ass some exact percentages of net worth to have in cash, crypto, and gold right now in case of a SHTF scenario?
2. Any difference from triangle investing in crypto currencies you are long on at the moment?
3. Any specific crypto currencies to focus more on for a SHTF scenario? (As opposed to triangle investing/answer to #2)
1) no because we don’t know your financial situation. If you’re worth $100M and can live off $50K a year (insane situation) then you could ramp up all high risk as much as you want.
2) No
3) No change.
I’m about to graduate college, so net worth is non existent. Not sure if having exposure in a SHTF situation takes precedence over an emergency fund but I have basically 6 months living expenses in cash and that’s it
what do you think of speculation on some of the smaller cryptos as a way to juice returns if there is a flood of capital into the crypto space? Since your recommendation in Triangle Investing is to invest in cryptos amounts the investor can accept a 100% loss, do you support the concept of 10-20 small bets on smaller cryptos for the change at extraordinary returns? If you support that concept, are there any in that space that you would recommend?
All recommendations in triangle investing.
None of that stuff matters its a 5-10 year play… you know actual investing not speculating on month to month nonsense
1.What is your faith in the supply chain for suburban cities in California/NYC over the course of the next 3 months?
2.Without giving equity, how do you guys get talented people to stick with you over the long run (more than 2+ years?)
3.How have the recent events changed the industries/spaces that are worth going into today? (What specific sectors or products would you NOT touch aside from financial services)
1) very high, necessities will be fine
2) You can’t, talent is expensive. If you get incredibly profitable then you pay them above market
3) Pretty much nothing except much more bearish on financial services and more bearish on conferences and more bullish on video games and software
Question on purchasing physical gold in Europe – do you have any Europe-based online equivalents of APMEX (suggested by one of your readers)? Otherwise shipping from the US (apmex) might mean paying additional taxes, based on the declared value of the shipment.
All the options (banks/ local dealers) are closed due to COVID situation.
Thanks in advance and good luck with your commercial RE search!
We do not know sadly as we don’t live in europe. There are gold bugs everywhere, find a few in europe and find a way to get a small physical amount and hide it for life
Any changes to efficiency in terms of starting a side income? I’m guessing a small (2k a month net to cover basic cost of living) CPG business is too small to really be affected by a recession?
24, 140k NW, 100k cash, 40k crypto.
I lost my high-paying job at a fintech startup, so #1 priority for me is to look for a new job. Also going through messy process with lawyers to get my equity (always get it in writing!) and a few months severance.
My financial technical skills aren’t top tier, but I do have some small boutique M&A experience as well as family office PE, at the fintech startup, I was an early employee who helped grow the business to a $26m valuation. so I should probably be able to get something in VC or at another startup. At this point, It seems my focus is to just make at least 100k from a job and focus the rest of my time on learning online sales
I’ve cut back expenses to 1k a month so I easily have 12 months living expenses + enough to start online business after getting into the swing of things at a new job . Yet I’ll also have 20-50k left over to invest in the coming months after the blood dries.
Should I even bother putting more into BTC at this point? Should I buy some gold? Wait for the dust to settle and get some stocks? I know my priority is to get a new job, I just feel bad having that much extra cash sitting around.
Same answer as above. No. You need an income and NO don’t invest unless you have as second income and are a millionaire. Wasting VALUABLE TIME
How likely are we heading toward negative interest rates and what’s a good asset allocation if that happens?
No clue. You cannot make that call at this time when things are declining by 10%+ per week. Is it a possibility? absolutely.
Wanted to first say thank you for the advice over the years, I have been following your blog since 2015 and it has truly made a positive impact on my life.
I’m 26, work in LMM private equity (about 1 year now) with 3 years of IB and have wanted to eventually transition to a l/s HF. Compensation will be higher but less time for side gigs (that I’ve had more time now that I work in PE; work/life has been great). My current role is pre-MBA unless otherwise noted (haven’t had that convo yet). Is it worth it to try to make the move? Realize you’ve already answered this generally, but given the likely push out to MBA and lower pay I feel like it’s the right move to eventually move to a HF. I just despise the idea of getting to 28/29 and being pushed out to get MBA where I could of already transitioned earlier. Surprisingly recruiters have been reaching out for analyst roles even through all the madness.
Side gigs are a subscription based biz (slowly ramping up) + a rental property.
1) you don’t have any questions here as you don’t have any outstanding offers. Stay employed and if you go to a Hf instead of staying in PE it won’t make a difference. Only thing that matters in those industries is performance of the fund.
2) the question we deleted the dollar amount you have doesn’t matter one bit, it’s about percent of net worth so it wasn’t even something we could answer. $1M is a lot to some and peanuts to others.
With the current drastic sell-off for oil, do you think it makes sense to invest a small portion in it?
Also, do you still consider investing into the S&P500 a wise decision in comparison maybe to investing in tech-stocks like Microsoft, Amazon, Google, maybe IBM (all due to AI focus)
1) do not know the industry well enough
2) We’re not buying any stocks at current levels still. If you’re going to try to time bottoms see our old post, find a way to protect against a big downswing worst case.
. You have mentioned that all ad spend should be cut.
If there is a business opportunity that
would actually improve as a result of COVID-19 do you think the opposite should occur? (as the cost of ads should reduce due to less ad spend)
2. What was your best trick to avoid having to go to “work drinks” as well as avoiding the mundane conversations about “what did you get up to on the weekend”? (I understand this is not as relevant now but for future reference)
3. Do you think the trend of further reductions in the price of cryptocurrencies is expected to continue as holders sell out to cover their living expenses (as COVID-19 gets more and more serious)?
1) yes our point is that if your conversions cost 400% more just cut it and wait. There are always exceptions to the rule
2) no tricks just don’t do it. Unless you’re worried about losing your job right now then keep up those politics games
3) It very well could go down, that is not the point. Hell we even wrote that right before it went from $8K to $4K and we bought at $4800 all verifiable on twitter.
what indicators are you looking for to know when time is to start buying stocks again?
Covered in spending
Me: Do you have any insight/commentary into ETF liquidity issues with the underlying assets? It seems many active managers poke at ETFs for not having proper liquidity measures in place.
WSP: “Yes it will blow up if panic selling begins since its illiquid and people will not be able to “dollar cost average”That one is clear as day, does it happen now? who knows.”
Me: So we’ve seen the impact on ETF liquidity and price movement with the last month. Is an ETF something you feel comfortable owning still? Does your advice change on buying the index (through an ETF) or would you advise individual stocks / mutual funds (assume you are at the number where it matters)? Or does it not matter if liquidity is gone because everything is screwed anyways?
Thanks for all you do!
What? Nothing has changed from our views see prior posts. When we are buying again we will say when.