Pier 3 Syndication

Category: Investment Strategies

  • Should You Invest In Real Estate Or Stocks?

    Should You Invest In Real Estate Or Stocks?

    To raise the value of your portfolio, you must discover a method that does not need too much of your time and work. Investing cash is a fantastic idea, but how can you invest without placing yourself in too much danger?

    This is a common topic; therefore, we’ll attempt to discover an answer for the best approach to investing your money. Most individuals contemplate purchasing property or investing in stocks for the (hopefully) long-term growth in value.

    Investigate the potential in each of these ways with us to help you expand your money without taking on too much danger.

    Invest-In-Real-Estate-Or-Stocks

    Which One Should You Choose?

    We’ll look at the two approaches, the hazards associated, and the rewards you may get from each.

    Real Estate

    Investing in real estate may be done in various ways, with the two major categories being residential and commercial properties. Residential investing is acquiring a home with the intention of renting it out or reselling it for a profit as soon as feasible.

    Strip malls, office buildings, and even apartment complexes are examples of commercial property that need more capital than residential property.

    Real Estate Risks

    You must do an extensive study before purchasing property and investing in real estate. If you decide to invest your money in real estate, there are several things you should think about.

    The first drawback of investing in real estate is that you will not be able to unload it fast.

    Commercial real estate may take much more work and time to refurbish, and repairs may be required.

    If you don’t have the time, you’ll have to hire someone to do it for you, which might be expensive.

    Tenants who do not pay rent or pay it late are another hassle to deal with in rental homes.

    You also cannot just evict renters if you want to sell the house and obtain cash immediately.

    Pros

    The fundamentals of property acquisition are simple to grasp, so you do not need to study how it works before investing. It works like this: you acquire a property, restore and repair what is damaged, manage the property’s care, and sell for a profit as soon as feasible.

    Investing using loan money is significantly safer when purchasing real estate for physical value. Even if you purchase with cash, you will feel more in charge of your property and find it simpler to maintain.

    Investing in real estate may act as a hedge against inflation, ensuring the property retains its worth. This is because, in most cases, rent will rise in tandem with inflation, as will the home’s value.

    Property ownership may provide tax benefits, as you may be eligible for a tax deduction for mortgage interest paid. If you sell a business property and use the proceeds to buy another commercial property, you may avoid capital gains taxes.

    Cons

    Investing in real estate will almost always require more effort than investing in equities. Maintaining a home will take a lot of time and work, particularly if you want to rent it out.

    If you want to invest in real estate, you will need a lot of funds; therefore, you may need to borrow money to get started. You must have a strong credit score and at least a 20% deposit in order to borrow the money.

    High transaction expenses are often the norm when it comes to purchasing and selling real estate for a profit. The seller may be required to pay substantial closing charges, ranging from 6 to 10% of the selling price.

    Diversifying your investment with real estate will be challenging since location is a major issue to consider when purchasing a property. It is also conceivable for value to rise in one region while sales fall in another.

    Profiting from your real estate investment is not guaranteed, particularly if you acquire to flip soon for a profit. It may be less risky to purchase a house and rent it out to tenants to generate profits on your investment.

    Stocks

    Before you decide to invest in stocks, there are a few things you should think about. With so many possibilities on the stock market, you must do extensive study to choose the one with the lowest risks.

    Even though it is true that investing in stocks is dangerous most of the time, there are strategies to lessen the risks. You should also seek for techniques to invest in equities that would provide the most returns on your investment.

    Risks Of Stock Investment

    When it comes to investing in stocks, there are many dangers to consider, including inflation and market volatility.

    One of the numerous concerns is that the firm from which you purchase the stocks may have operations in other nations with their own issues.

    These issues might cause stock values to plummet, perhaps resulting in a loss of revenue.

    Another danger might come from an investor who chooses not to diversify their investments, putting them at higher risk.

    Panic selling may occur if stock prices fall and the investor believes it is time to sell without fully understanding the dangers.

    To see the pros & cons of a stock investment please visit: https://energimine.com/should-i-invest-in-real-estate-or-stocks/

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  • How To Invest For Unicorns And Soft Landings (DON’T)

    How To Invest For Unicorns And Soft Landings (DON’T)

    inflation, economy, invest,

    Unless you’re a central banker, don’t panic. In that case, what are you doing reading this? Don’t you know that inflation in the United States is currently at 7% and is likely to reach that level in the United Kingdom? Aren’t you supposed to be raising interest rates as quickly as possible?

    I was just a few days ago reading about the impossibility of a 0.5 percent interest rate increase in the United States (in a tweet that has mysteriously disappeared from my feed since). The next thing I know, the market is pricing in a 100 percent possibility of a 0.5 percent interest rate rise…

    One minute, Reuters says that Federal Reserve policymaker “Bullard does not believe a half-point rate hike really helps us,’” and the next, he is “urging” one.

    Why? Because inflation continues to rise faster than projected.

    Isn’t that an oxymoron? Isn’t a continued surge actually just excessive inflation?

    The behavior of those tasked with keeping inflation under control has been as erratic as the inflation statistics themselves. Even markets are perplexed by policymakers’ inflationary policies.

    Financial markets are (supposed to be) one step ahead of what is actually happening. They also prefer to price in the direction of change rather than the change itself – whether the news is good or negative is less important than whether it was better or worse than predicted.

    On sometimes, this results in odd market behavior. It’s only strange if you’re a step behind the competition.

    Do you remember when good news was considered terrible news and bad news was considered good news? Back then, the premise was that positive news would lead to tighter monetary policy, which would be terrible for financial markets. As a result, the better the news from the economy, the worse the markets performed…

    Bad news provided policymakers with an excuse to keep interest rates at zero percent and quantitative easing (QE – the creation of money out of thin air to buy bonds) in place for a bit longer. This was beneficial to the financial markets. Markets rose as a result of the dismal economic statistics.

    It appeared strange at first, but in a world of heavy-handed central bank interference, it made sense.

    But things don’t make as much sense these days.

    Central banks have a monopoly because markets are far too indebted as a result of Covid and years of low interest rates, as well as promises of further low-interest rates in the future. Borrowing risk looked insignificant, therefore the globe leveraged up.

    However, because of all of this debt, interest rates cannot be hiked significantly without causing another financial crisis.

    Then followed inflation, which should have compelled central bankers to hike interest rates…

    What a pickle (of their own creation) they’ve made!

    Nobody understands how to interpret the inflation figures right now. Is inflation beneficial or detrimental to stocks? Are rising interest rates a good thing or a negative thing? Will higher interest rates cause a debt crisis or reign in inflation, or will they be too little, too late to contain inflation that is already out of control?

    It’s no longer entirely obvious. People can’t agree on a story, even if it doesn’t make as much sense as it did.

    As a result, asset market price activity is out of control. In the United States, assets such as gold, bitcoin, the US currency, oil, and bonds dropped and skyrocketed all over the place as inflation news came out, and then again when central bankers’ following statements were disclosed. Many prices traded past their starting position numerous times during the day, jolting up and down…

    As a result, a single piece of news might potentially have several implications for markets. Nobody can agree on what it may signify.

    A high inflation print might indicate that inflation is out of control, or it can indicate that central banks will be obliged to induce deflation by hiking rates too quickly — the polar opposite consequence from the same piece of data.

    But here’s what’s actually going on behind all of this mayhem. The central banks are attempting to arrange what is known as a “soft landing,” in central-bank jargon. This is a legendary phenomenon that no economist has ever experienced, making it even more uncommon than a unicorn.

    The core concept is that higher interest rates may slow down an economy without causing financial or economic havoc. That it is possible to reduce inflation without precipitating a recession.

    When central banks do this, the result is…well, some type of financial or economic carnage and a recession.

    The task for investors is straightforward. What will the financial markets price in next?

    Will they factor in rising inflation? Or have interest rates been raised? Or the recession/crisis that higher interest rates would produce, bringing inflation back down?

    Of course, we could get all of them in a row. Inflation might erupt, causing panicky interest rate rises and, ultimately, a crash.

    So it all boils down to the age-old question: how far ahead does the market appear to be? Because the cycle is well-known and comprehended. It all happens again and again: boom, crash, inflation, and deflation. Despite this, the market is bouncing and jolting asset values all over the place, and then back again. It’s attempting to determine which future event has the most impact on today’s investment pricing.

    copywriting tipsHave you observed how central banks are plainly creating the business cycle rather than smoothing it? They’re meant to tinker with interest rates in order to avoid busts and limit booms. However, they appear to be busy producing inflation and then triggering recessions in order to rein in their inflation.

    And that is the fundamental issue here – one I make much too frequently, but you can blame central bankers and politicians for that.

    Intervention in the economy has no positive effect. It aggravates them. Energy price limits induce energy price spikes. Low loan rates produce illusory booms, as we’ll discuss in tomorrow’s Fortune & Freedom video. Fiscal stimulus has a negative impact on economic growth. And the list goes on and on.

    What we’re seeing today is a moment of unprecedented government interference in the economy. Whether it’s good or terrible at the time, the point is that it’s going to be a major issue in the following months. Just like all government initiatives eventually show to be a problem.

    All of this is what Paul was implying in his question to Nigel Farage. And you can see how Nigel responded in his most recent Question Time video, in which he answers a series of your questions.

    By the way, we’ve had some great reader feedback on whether higher interest rates truly reduce inflation. Please email in your permission to reprint your ideas if you’re reading this!

    Before you go, one final thing. There is one sector of the economy that always manages to avoid the worst of government involvement simply because it is too innovative to tame. Regulators and politicians just cannot keep up with the rate of innovation in high technology.

    And there is one major sector of the economy that is now miles ahead of governments, regulators, and central banks. That is why it is thriving. And why you should see this.

    Nick Hubble
    Editor, Fortune & Freedom

    The post How to invest for unicorns and soft landings (DON’T) appeared first on Fortune and Freedom.

    The post How To Invest For Unicorns And Soft Landings (DON’T) appeared first on https://gqcentral.co.uk

  • Why The Origins Of Covid Still Matter To Your Portfolio

    Why The Origins Of Covid Still Matter To Your Portfolio

    covid, pandemic, pcr test, covid 19

    I’m sure you’re sick of hearing about Covid. Indeed, you may be hoping that the crisis is behind us. Especially for investors. We’ve got other things to worry about these days. Like inflation, rising interest rates, and a tech bubble.

    But you might be wrong. There’s at least one remaining angle to the Covid crisis which could still play out. And it’s not a very nice one. But I won’t let that stop me…

    The origins of Covid remain a mystery… of sorts. But it could become a major flashpoint for geopolitics and financial markets in the coming months. We may even see a plunge in the US dollar and a sovereign debt default as a result!

    But first, let’s review what we think we know…

    Despite the location of the Wuhan Institute of Virology, and the nature of its research, scientists quickly tried to dismiss the Wuhan lab leak theory as a conspiracy. Claiming no conflict of interest, 27 scientists co-signed a letter that tried to shut down any scientific debate on the matter.

    It turned out that 26 of the 27 had links to the Wuhan lab. The key individual behind the attempt to discredit the lab leak theory was also involved in the World Health Organisation’s (WHO) botched investigation in Wuhan. Three signatories subsequently stated that the lab accident theory is actually plausible.

    copywriting tipsScientists have also admitted that their obsession with Donald Trump being wrong about everything was behind their attempt to discredit the lab leak theory in the first place. As one opinion piece in the Toronto Sun put it, “If you wanted to design a way for doctors and scientists to undermine support for public health officials, I couldn’t have done a better job than they have done themselves.”

    Not that the Guardian was having any of it:

    The Wuhan lab leak theory is more about politics than science

    Whatever this week’s Biden review finds, the cause of the pandemic lies in the destruction of animal habitats

    Yes, whatever the Biden review finds, the Guardian must stick to its story.

    As must the scientific establishment, according to Sir Richard Dearlove, former head of MI6. He claimed that “some scientific journals absolutely refused to publish anything that disagreed with the Chinese view”. Peer review can look a lot like peer pressure…

    The circumstantial evidence, meanwhile, strongly suggests the lab leak theory is the most likely explanation.

    As Jamie Metzl, a former national security official in the Clinton administration, wrote in The Wall Street Journal, “suggesting that an outbreak of a deadly bat coronavirus coincidentally occurred near the only level 4 virology institute in all of China—which happened to be studying the closest known relative of that exact virus—strains credulity.” And a “comprehensive forensic investigation must include full access to all of the scientists, biological samples, laboratory records and other materials from the Wuhan virology institutes and other relevant Chinese organizations. Denying that access should be considered an admission of guilt by Beijing.” (Emphasis added.)

    But there is no smoking gun. Although, David Baltimore, a virologist and former president of the California Institute of Technology, did say this: “When I first saw the furin cleavage site in the viral sequence, with its arginine codons, I said to my wife it was the smoking gun for the origin of the virus. These features make a powerful challenge to the idea of a natural origin for SARS2.” (Emphasis added.)

    The thing is, even without a smoking gun, the evidence is beginning to mount a little heavy. The latest example comes from Antarctica of all places. Hungarian scientists claim that soil samples sent to a Chinese biotech firm in December of 2019 became infected with a particular strain of Covid that may unlock the mystery.

    Here’s the key bit from the Telegraph:

    The variant has mutations that bridge the gap between bat coronavirus and the earliest Wuhan strain, so it may be an ancestral version of the virus.

    The samples also contain DNA from hamsters and monkeys, suggesting that the early virus may have been grown in animal cell lines.

    We’re talking about African green monkeys and Chinese hamsters, neither of which exist in Antarctica as far as I know, and are unlikely to be found in a Wuhan wet market. But they have commonly used laboratory cell lines…

    Oh, and the Wuhan lab at the center of the drama uses the same Chinese biotech firm for gene sequencing as the Hungarians did.

    What a coincidence!

    As the Guardian put it, “The main evidence to support a lab leak rests on the failure of scientists to pinpoint the intermediate animal that picked up the virus from bats and passed it to humans.” Well, if that animal was an African green monkey and not a pangolin…

    But why does all this matter?

    Well, Jim Rickards explains why it could in his book The New Great Depression. The underlying idea is that the Chinese government could be sued for damages by other governments.

    Of course, the Chinese would refuse to pay up, if they even acknowledged the claims. However, that might not be the end of the story.

    Sanctions are one option to “collect” payment. Or the requisition of Chinese assets in other countries.

    But Rickards mentioned another one. Governments could default on debt held by China as a means of collecting compensation for Covid.

    China owns over a trillion US dollars of US government debt, for starters…

    This creates an opportunity to disavow the debt held by the Chinese government.

    Such a drama is not unheard of, in a way. In 2012, a US hedge fund seized an Argentine navy tall ship called the Libertad in a Ghanaian port. NML Capital owned over US$1 billion of Argentine debt, but the government had refused to pay after defaulting in 2002.

    A US judge awarded NML Capital the money and a local judge in Ghana took NML Capital’s side too.

    This was only one of several similar stunts. The same hedge fund even tried to impound the Argentine president’s plane…

    The point is, attempts to recover money owed by governments in creative ways outside of their jurisdiction have some basis in court. And governments may well choose to repudiate debt owed to Beijing under the cover of a court ruling which declares the Chinese government should compensate the world for the Wuhan lab’s failings.

    So, the lab leak theory could still matter.

    But why does this matter to you?

    Well, what would happen next?

    The precedent of defaulting on Chinese-owned bonds could undermine trust in the US bond market and the US dollar itself.

    If courts can allow selective defaults on bonds based on legal claims, are those bonds still “risk-free” as academics and regulators claim? What would China do with its bond holdings? What would Russia and other nations deemed unruly by the US do?

    A sudden selloff in bonds in reaction to any attempt to repudiate debt could trigger a surprise interest rate spike in the US, which affects global markets very directly.

    So, the Covid saga may not be over yet…

    Nick Hubble
    Editor, Fortune & Freedom

    The post Why the origins of Covid still matter to your portfolio, whether you like it or not appeared first on Fortune and Freedom.

    The post Why The Origins Of Covid Still Matter To Your Portfolio appeared first on https://gqcentral.co.uk