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Prediction: 2021 is going to be a total shit show. Place your bets now.

csalvato

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I've spent most of the day today reading up and reflecting on the current state of the global economy - particularly it's response to the C0VlD-19 pandemic.

Based on all I know, it seems like 2021 will be a total shit show, and I'm placing very big bets accordingly.

Before I get into the gritty details (which sound horribly negative), I don't view this as a shitty year for me, or you, personally. I view it as an opportunity to play an interesting and challenging hand that life will deal all of us.

Now onto the prediction...

The current state of affairs
I don’t really see us coming out of the Corona-lockdown mentality in 2021 in any meaningful way. This was a hard conclusion to come to grips with. As an entrepreneur, I'm a relentless optimist, and I hate the idea of my business and life being affected by Corona for another year.

But, it will.

The rationale is simple: the powers at be aren’t even factoring the economy into their decisions.

The only thing they are gauging all decisions against are total death counts and total case counts, which are being inflated by official orders from the CDC (they want to make sure they have the broadest definition of a "Corona case" and "Corona death" as possible).

This means a few things:
  1. Since decision makers aren't factoring the economy into their decisions at all, they will necessarily need to wait for cases to slow, which will take a long time because....
  2. Total death counts and total case counts can only rise until at least every American is confirmed to be infected or inoculated. At the time of this writing, there have been only 20M cases of ~350M citizens. We likely will need to hit at least 60 or 80M confirmed cases to start seeing cases organically slow down.
  3. That means we would need another another 3-4 years at the current rate of infection to start seeing the new cases slowing down. This also assumes that Corona cannot re-infect people who previously tested positive, something that's still not understood nor accepted.
  4. Before we hit those milestones, the stock market will necessarily have to collapse as:
    1. Small businesses continue to shut down and ultimately collapse - either due to SMB owners not being able to sustain their business with cash flow (due to regulations reducing sales volume) or SMB owners simply getting tired of being a sucker and closing up shop to take jobs with the companies that aren't shutting down (i.e. Facebook, Google, Amazon, Walmart, etc.)
    2. The Misery Index will climb or rocket up (again) and people won't be able to spend nearly as much as they used to.
    3. Lawmakers will print more money to counteract the rising Misery Index, hoping that it will reduce unemployment, despite increasing inflation. Printing will lose its effect on unemployment (it may have already lost this effect), and inflation will go up.
    4. This positive feedback loop will continue until consumers can no longer afford to buy real estate or luxuries (possibly even necessities).
  5. The stock market collapse mentioned in #4 will have to be drastic. The driving forces for the collapse are absolutely unstoppable at this point. Likely, a drop back to the 10k or even 5-7k region on the DOW.
  6. By the time decision makers pay attention, it will be an irreparable situation (if not already irreparable).
  7. At this point, lockdown restrictions may loosen, but we will be in such a state of turmoil and depression, business owners and investors will be facing totally new challenges. Challenges not too dissimilar to those faced during the Great Depression.
This is a pretty bleak prediction for the year. (Sorry if you were expecting something more cheery as we leave 2020 behind!)

I'm not a pessimist, just trying to see the world as it is.

As a result, I evaluated where I can invest my two most valuable assets: my time and my money. Since my time investments are very particular to my own business dealings, I'll focus on my assessment of monetary investments:

Possible Monetary Investments
  • Stocks - This seems like an incredibly risky bet. I believe Q1 will see a sharp rise in stocks with a huge run up within a single day or a week. This will be the bubble caused by unprecedented inflation, and the stock market flooded with even more dumb money. I believe it will pop immediately after.
  • Bonds - I'm not an expert on bonds, but my understanding is that, since this scenario unfolds with a total collapse of the DOW, bonds may not be all that safe, and would be a conservative investment at best. I'd be more interested in vehicles with a higher potential return.
  • Real Estate - I believe that real estate will see a crash shortly after (within 8-18 months) from the brutal crash in the stock market. Historically, IIUC, these two tend to trend together. On the macro, people won't be able to afford houses or rent, and landlords will struggle to evict because of COVID regulations thus defaulting on their mortgages as they can't service their debt.
  • Angel Investing/Small Business Acquisitions - This could be very lucrative if you place the right bets on the right companies that will be able to serve the market during the upcoming depression. In the case of an acquisition, purchasing a business where you can add value immediately could be a terrific strategic move in 2021.
  • Fiat currency (USD, EUR, etc.) - This is, at best, a melting ice cube. At worst, it's a house of cards. The value of these currencies go down with every printing. The collapse of the stock market will strip the world of value measured in fiat currency, particularly USD, and could cause a terrifying collapse.
  • Gold/Precious Metals - Historically a great hedge against inflation, but have largely not responded to the great inflation so far. They could be lagging behind other inflation hedges, or they could have maxed out their potential as a hedge to inflation.
  • Bitcoin - Currently perceived as the best hedge against inflation by major hedge fund owners and some billion-dollar CEOs. If I am analyzing correctly, the market in general as evidenced by the recent run up.
  • Altcoins - Possibly even more potential as an inflation hedge, but most are largely unproven. Even ETH has not been reliably used for a dApp with mass adoption.
My Bets

Based on this assessment, I'm planning to do the following:
  • Increasing my position in Bitcoin during Q1, when I anticipate a short, transient dip to occur. This isn't something I take lightly, as I'd likely be putting over 90% of my total liquid assets into BTC directly. I view this as a huge risk, but I view all the other investment vehicles as far more risky.
  • I'm avoiding stocks, bonds, and real estate and trying to hold only enough USD to carry on month-to-month business.
  • Starting to look at angel investing/small acquisitions with lockdown- and depression-compatable business models.


What are your predictions for 2021?

If you have a differing opinion on these scenarios, I'd love to hear it – particularly if you think I'm flat out wrong on any of this logic. I'm far more interested in knowing the truth than being right here, and I understand that several people have a totally different perspective than me.

(@JScott , @James Fend and @Kak, I'm looking at you!)
 
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sparechange

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With government printing money and handing it out like candy I wonder what the purchasing power of $1 will be in the near future.

Trudeau will be hiking up taxes yet again, and with Biden running the US.... yikes, very very scary times are ahead of us.

Found a cool little calculator to play around with



1609505402174.png

People have been getting locked up in cages for defying public health orders across Canada, we are (or have been) one of the freest countries in the world, but now it's quite scary all of the orders government has been giving us.

In Vancouver it's illegal to have friends over at your house...imagine that, but pop over to a crowded 711, Walmart or Costco and it's A-OK!

Don't forget to wear your mask, or get your ribs broken by Vancouver police...(true story) or better yet, have police officers smash your door in and haul you off to jail for violating a law that prohibits you from having people inside your own private residence. Another true story..

In 2 years I'll be voting for the first time, who knows if it will even matter though, I'll be optimistic, now is the time to Unscript, and buy that private island somewhere!

''True North Strong And Free''
 
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Choate

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Not really interested in entertaining any bleak outlooks. It's not avoiding reality, just choosing to focus on what I can control and making the best of it from there. Every year, there's reason to play doomsayer if you want to. Sure, there will be some rough waters ahead, but nothing our ships can't handle.
 
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D

Deleted78083

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Why not holding stocks of companies that will stay open during the pandemic and for which business owners may go work for according to you?

-------------------------------------------------------

Predicting the future is a difficult exercise, but I don't believe it will be as bad as you say.
So, here are my bets:

- The pandemic will be over by the end of 2021.
- China will grow increasingly threatening to the free world as everyone will be reassessing their relationships with them (and already are, as brilliantly explained by @Walter Hay ).
- Rents in cities will go down as offices will close since employees won't want to come back to the office and may move out of city centers.
- About that, Greece and Croatia are on the frontline of establishing special visas and tax rules for "digital nomads" that are now digital employees. I believe Southern countries (Europe, America and Asia) are about to witness an invasion of digital workers looking for affordable life, great food, and great weather.
- The "education bubble" will explode (people won't want to go to uni anymore).
- GAFA monopolies will be broken down.
- The bitcoin bubble will explode when people will see the energetic cost to maintain the blockchain while gold is free to own.
- Deflation. Yes, I am betting on deflation, and here is why:
  1. Inflation has little to do with printing money, but is a consequence of a society that consumes more than it produces.
  2. As long as we keep production levels high, we shouldn't see any inflation.
  3. In the developed world, consumption is fueled by credit while in the developing world, it is fueled by rise of income (rise of production per capita). The pandemic outlined how little people needed to survive, and they will change their consumption habits, especially in the US where consumption is most of the time fueled by debt.
  4. Businesses won't go bankrupt because of covid, but because people will consume less because of covid.
  5. Many more people have died than normal, and most of them weren't producing anything since they were old and retired. This adds to the decrease in consumption within society.
  6. People have less money now, which means they will consume less in the upcoming years. Maybe not less, but at least differently. I believe that the trends will shift from quantity (1kg of crappy ice-cream) to quality (200 gr of tasty ice-cream).
- The stock market may decrease to reasonable levels, but I don't think so as all the money we printed will have to end up somewhere. At the moment, people are pouring it into btc, but it's a speculative bubble, not a long-term investment.
- I will find a girlfriend.


Ok that's it happy new year!
 

csalvato

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Not really interested in entertaining any bleak outlooks. It's not avoiding reality, just choosing to focus on what I can control and making the best of it from there. Every year, there's reason to play doomsayer if you want to. Sure, there will be some rough waters ahead, but nothing our ships can't handle.
My goal is not to be a doomsayer, but to control what I can during 2021, just like you say.

Please reread the post. I am assessing the world around me in order to capitalize on it.
The world around me seems to have this bleak outlook, no matter which way I analyze it.

You can’t make the right moves to live a joyous life if you refuse to open your eyes and live in the real world.

Don’t confuse a bleak economic outlook with a bleak personal outlook.

2021 is poised to be my best year ever, emotionally, spiritually and financially....topping only 2020
 
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csalvato

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People have been getting locked up in cages for defying public health orders across Canada, we are (or have been) one of the freest countries in the world, but now it's quite scary all of the orders government has been giving us.

Right.

My assessment in April 2020 was that this was a temporary, transient blip of terribleness. We would experience panic due to the disease, particularly when we didn't know how bad it could possibly be, then we would open up.

In December of 2020 (Jan of 2021, now) it looks like the first part of my prediction was true...there was panic when we didn't know how bad it could be.

But I was very wrong on the second part, which anticipated that we would open up once we knew more about the disease and how to treat it.

The crux of my economic outlook is based on seeing a clear path to opening economies again, around the world. It doesn't seem like our lawmakers aren't willing to open our economics, so long as top line death and case counts are still going up...and there is no mechanism for that to slow down until everyone is infected.

Ok that's it happy new year!

Thank you for your thoughtful reply. This was the kind of analysis I was hoping to see from other people's perspectives!

Also, happy and joyous new year to you! I hope you and your family are joyous and prosperous this year. It appears you and I are part of a minority choosing to play chess and not checkers :happy:

Why not holding stocks of companies that will stay open during the pandemic and for which business owners may go work for according to you?

I'm fairly confident of two things:
  1. The stock market will see a crazy collapse (or, at the least, a hefty softening) that will bring even these stocks down.
  2. I won't be able to time the top – that's not a strong suit of mine.
Since I believe #1 pretty strongly, and I don't think I'll be able to capitalize on it, that doesn't seem like the best move for me, personally.

- The pandemic will be over by the end of 2021.

I believe that this will be true, but not because our lawmakers have been bestowed with superhuman rational reasoning...but because they will see the harsh impact of the decisions they made.

If they do change their course and start opening things up even if the total case + death count increases, it will be because the external reality of the economy has gotten far too terrible to ignore. To me, this is a function of when/if that happens.

This is actually the most important question to me, since my business' growth has been heavily hampered by C0VlD-19 (we currently serve physical locations that organize groups in indoor spaces). We've decided to add more features to our products that support smaller groups – something we would not have done if we felt the lockdowns/pandemic panic was stopping by Q2.

I sincerely hope I'm wrong on this, and our lawmakers come to our senses - because then playing the cards of 2021 will be a cakewalk for me.

- China will grow increasingly threatening to the free world as everyone will be reassessing their relationships with them (and already are, as brilliantly explained by @Walter Hay ).
- Rents in cities will go down as offices will close since employees won't want to come back to the office and may move out of city centers.
- About that, Greece and Croatia are on the frontline of establishing special visas and tax rules for "digital nomads" that are now digital employees. I believe Southern countries (Europe, America and Asia) are about to witness an invasion of digital workers looking for affordable life, great food, and great weather.

I think we've both come to the same conclusions on this. Similar to the exodus CA and NY are experiencing, I believe an exodus to other countries is very possible in 2021.

I also believe that buying real estate in Miami will be a particularly fruitful bet (even though I think real estate overall will be a challenge), because the mayor of Miami has been doing a terrific job attracting people who are fed up with regulation and taxation.

- The "education bubble" will explode (people won't want to go to uni anymore).

What is the driver for this to happen in 2021? I foresee this happening in the future, but I didn't think 2021 would be the year for it.

- The bitcoin bubble will explode when people will see the energetic cost to maintain the blockchain while gold is free to own.

That's an interesting driver for blockchain costs to go down but gold costs to go up. I am not sure I agree with it though. I'd have to think about it. I don't think anyone in 2021 will care at all about the energy consumption of BTC. Most people entering the market right now don't even know that energy consumption is a problem to be solved, so I can't see that negatively impacting price. I may be missing something.

Deflation. Yes, I am betting on deflation, and here is why:
  1. Inflation has little to do with printing money, but is a consequence of a society that consumes more than it produces.
  2. As long as we keep production levels high, we shouldn't see any inflation.
  3. In the developed world, consumption is fueled by credit while in the developing world, it is fueled by rise of income (rise of production per capita). The pandemic outlined how little people needed to survive, and they will change their consumption habits, especially in the US where consumption is most of the time fueled by debt.
  4. Businesses won't go bankrupt because of covid, but because people will consume less because of covid.
  5. Many more people have died than normal, and most of them weren't producing anything since they were old and retired. This adds to the decrease in consumption within society.
  6. People have less money now, which means they will consume less in the upcoming years. Maybe not less, but at least differently. I believe that the trends will shift from quantity (1kg of crappy ice-cream) to quality (200 gr of tasty ice-cream).
- The stock market may decrease to reasonable levels, but I don't think so as all the money we printed will have to end up somewhere. At the moment, people are pouring it into btc, but it's a speculative bubble, not a long-term investment.
- I will find a girlfriend.

Perhaps I just don't know much about inflation/deflation.

One analogy I turn to is that, if we are in prison and trading cigarettes, and someone comes with a bag of cigarettes and dumps them in the middle of the floor, the value of those existing cigarettes drops at least proportionally to the amount of new cigarettes added.

I understand this analogy is simplistic, but your assertion basically states that there are almost no consequences from printing nearly half of our 2019 GDP.

Also, it seems a main point from you on inflation is that we need to keep production levels high - but how can we do that if the meat of our economy – SMBs – are going to continue to shutter?

I'm not sayin you're wrong, just that I'd like to know more :)
 

Raja

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Seriously, no consequences.


Remember, the 2008 economic crash did not impacted the *entire* world, but this one did and pretty badly.

What about people who lost their job. Will they just get back to their previous job like nothing ever happened.

Edit: and no long term impact for government poor, i mean extremely poor policies worldwide.
 

Choate

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My goal is not to be a doomsayer, but to control what I can during 2021, just like you say.

Please rereabd the post. I am assessing the world around me in order to capitalize on it.
The world around me seems to have this bleak outlook, no matter which way I analyze it.

You can’t make the right moves to live a joyous life if you refuse to open your eyes and live in the real world.

Don’t confuse a bleak economic outlook with a bleak personal outlook.

2021 is poised to be my best year ever, emotionally, spiritually and financially....topping only 2020

Ok sure, I'll bite. Seems like an unreasonably bearish outlook on every vehicle except for Bitcoin, and I don't think any situation justifies dumping 90% of total liquid assets into it. I'm not on board with going all-in on it while writing off stocks/bonds/real estate. Seems more like a gamble and less like a preservation of wealth.

Overall, I have a very dull, boring take that won't be found in the latest clickbait articles. Not much has changed, there will bumps in the road (like always) but everything will continue to trend upwards. Even if it trends downwards for a year, it won't matter if you're playing the long game - since these are just methods of keeping net worth stable as opposed to growing it; we have the fastlane/other work endeavors for that.

C0VlD-19 has removed the stigma associated with working from home. Almost half of Americans do it now. Businesses have already used 2020 to become lockdown-compatible and adjust to this new reality, and will only become more efficient in 2021.
 
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Kak

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LOL, @csalvato you opened quite the can of worms here. Despite some of the negative comments, I see no utility in denying reality. On the contrary, being in tune with reality is something that can be highly beneficial for an entrepreneur/investor relative to the rest of the world.

First and foremost, this day on the calendar thing is a joke. The world turns, it gets cold and hot, we measure the time of year it gets cold and hot. Time marches on and changing the big number on the calendar instead of the little number matters zero to change your personal reality, or a macro reality. Reality is. People who are optimistic about the next several years on a macro level are doing so at their own expense. Let me be clear though, you can still be optimistic about YOUR OWN POSITION in this mayhem. Crises like the ones I am about to unfold for you break a lot of people, but they also happen to make a lot of people.

Now, I agree with the basis of @csalvato thread here. 2021s fate has already been determined.

While I think we are going to have a "crash" I personally think it will look a bit different.

Melt up vs melt down. First of all, I wouldn't be surprised to see dow 40k-50k next year. Don't pull out the champagne yet.

Mark it...

At DOW 30k, 30k buys a nice Honda Accord. $1000 buys the newest iPhone. $100 buys a nice dinner out for two who don't drink.

With the melt up I am anticipating it might look something like this...

At DOW 50k, you will notice an out of balance gain vs buying power. "Wow! I am rich I have all of this money, but why is stuff so expensive?" That nice trim level Honda Accord? (Not really a luxury good, but nice) Probably $60k now. That brand new iPhone? (A little bit more of a luxury good. Those are only for "the rich" now, probably $3500-5000.) And a nice dinner out is a TOTAL luxury good and you might see that melt up tenfold to $1000.

Your average 300k home is probably worth 500k, and once again, that appreciation would have little relative gains.

So even though all indications point to absolutely "killing it" in the markets, it matters none when we examine relativity.

Yes, I believe we are going to see a currency crisis. Timing it can is impossible for anyone without a time machine, but those who ignore history are doomed to repeat it. The scenario I painted above is just transitional... That is the US Dollar on the way out. When do people literally stop trading dollars for goods and services? What point? THAT IS THE POINT OF NO RETURN. That is when you won't be able to trade a billion dollars for a new Honda. When people finally realize that they are getting shafted, what do they do? They can't get into multi-family real estate, which is actually going to kill it in this scenario, why? Because who would take their money now?

In a currency crisis, people historically rip their money out of domestic denominated anything and flee to foreign currency and assets denominated in those currencies. This exacerbates the problem and there is NOTHING the fed can do about it at this point.

The fed fights inflation with inflation. They fight a poor economy with low interest rates. There is no other choice, but for the currency to melt down. They can't raise rates right now... They can't tighten the money supply...

Now, I am NOT going to tell people how to invest. Funny the old "more money more problems" thing, people with money have a LOT to consider going into 2021 to preserve their wealth. They should do their own research, but I will tell you guys that I have put my money where my mouth is... I keep very few uninvested dollars on hand. Less than 6 months of expenses. EVERYTHING currently has its place.

Traditional investments:

AAPL
- I own a pretty big position in Apple. Why? Because they are a well run company with good earnings. It is a position I have held for years and it has treated me well... That said, while I do believe it will outperform the Dow in this scenario, it will be one of my first to go.

MSFT- I own less of this than Apple, but still a large position. An oligarch tech giant with strong ties to government. Strong earnings and relative to the nutjob holdings some people have, a relative bargain. I believe it will outperform the DOW in my scenario as well. I might hold this one longer than AAPL, but it will probably be the second holding to go.

Metal Exposure- Already my largest position by far. Those of you that know much about me, know that I am a gold bug. Gold is gold. Silver is silver. They are not dollar denominated. I like it. In early 2021, I plan to split my GLD holdings in half, half going to a more leveraged position like GDXJ that will essentially maintain that upside in my trading account as I also take the other half and acquire a LOT more physical bullion.

VXUS- I own a large position in this. This is a Vanguard international total market fund that is a great play for the weak dollar. Pretty easy to describe. Stocks in foreign countries. This will rocket at that aforementioned inflection point. This is where my investments in AAPL and MSFT go when I do sell them.

VWO- I own a smaller position in this. This is a Vanguard emerging markets fund. Emerging markets also stand to gain quite a bit by a dollar crises. The strong dollar has historically made things difficult for emerging markets and the opposite is also true. These markets are also usually countries that are used to a crappier standard of living and thus can ride out a financial shit storm more comfortably.

REET- I own this. This is a broad scope international real estate investment trust. These are leveraged. This trust owns leveraged hard assets. Weak currency is really good for people who own hard/useful assets with leverage. It is exposed to the USA unlike VXUS and VWO, but I believe it will outperform.

XOM- I recently added this position. Why might you ask? With Biden coming to town and green new deal, electric cars yada yada... Because the road to hell is paved with good intentions. I see a massive cut in supply at the hand of world elite and a relatively stable inelastic demand. Rising oil prices are good for XOM like rising gold prices are good for GDX and GDXJ. Fossil fuels are in no way irrelevant yet and with the socialistic direction of our world, viable alternatives that can exist without life support will come slower to the party than anticipated. The Fed can't print commodities or utility.

Alternative Investments:

Bitcoin-
I know @csalvato is a massive bitcoin bull, but I just don't have the balls to do what he does. He might make out like an absolute bandit, or he might lose everything. He knows this is risky. That said, historically crypto has been a tremendous tool of the currency crises in Venezuela. I think it might become a temporary means of exchange, albeit a hamfisted one, at least they are infinitely divisible. Someone might be more willing to trade ammo or food for bitcoin than dollars. I like bitcoin, I really do, but to me it is exposed to the socialist ban hammer, it might be in a bubble, it is a human invention, not a true commodity, and could be replaced with something better to its extreme detriment. I view bitcoin like an anarchy checking account more than I view it as an investment.

If you don't have one, I would get a Ledger ASAP.

Guns and Ammo- This goes without saying. Being able to take your safety into your own hands in a scenario in which society as we know it melts down. Trusting cops with your safety is stupid anyway. These items will be INVALUABLE. I have NEVER been such a free spender on guns and ammo as I have in 2020. I rationalize it like this... My net worth didn't move with these purchases. I can sell all of these items, already, for more than I paid for them.

If some of you are curious about buying your first gun, take a class and get a Glock. You can't go wrong. Eventually you may find different tastes, but a glock is simple, affordable and reliable. Also, a good bolt action rifle in a common caliber would be prudent.

I also am in the process of acquiring high end reloading equipment that can churn out a LOT of ammo. The equipment is going to appreciate. The ammo it produces is going to appreciate. The guns that consume it are appreciating. Even if I decide to bag this idea and move on to something else, my buying power/trading power is preserved.

YOUR MIND- Bring it with you to the "end of the world."

Lastly, invest in yourself. Own your FUTURE knowledge in physical form. Buy ahead in books. I own probably 100 books I haven't read, but plan to.

I don't subscribe to the hole up and protect your hoard mentality. I am an entrepreneur and will act in accordance with the way my world works. I will have businesses amidst anything the world throws at me. The trick is sustainably being able to continue exchanging value for profits, perhaps in a different medium of exchange.

Entrepreneurship takes these days as they come, yet considers all of this. It is fluid. It goes where it needs to go. The entrepreneur is the type of person who pulls the world out of this, we all should intend to BE entrepreneurs yesterday, today and tomorrow.
 
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csalvato

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Overall, I have a very dull, boring take that won't be found in the latest clickbait articles. Not much has changed, there will bumps in the road (like always) but everything will continue to trend upwards. Even if it trends downwards for a year, it won't matter if you're playing the long game - since these are just methods of keeping net worth stable as opposed to growing it; we have the fastlane/other work endeavors for that.

I’m curious on your rationale about this if you can expand on it.

You believe that we will continue to generally trend upwards even though more SMB businesses will necessarily have to shutter? Or are you simply optimistic on things reopening? If so, why?
 
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Deleted78083

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Right.

My assessment in April 2020 was that this was a temporary, transient blip of terribleness. We would experience panic due to the disease, particularly when we didn't know how bad it could possibly be, then we would open up.

In December of 2020 (Jan of 2021, now) it looks like the first part of my prediction was true...there was panic when we didn't know how bad it could be.

But I was very wrong on the second part, which anticipated that we would open up once we knew more about the disease and how to treat it.

The crux of my economic outlook is based on seeing a clear path to opening economies again, around the world. It doesn't seem like our lawmakers aren't willing to open our economics, so long as top line death and case counts are still going up...and there is no mechanism for that to slow down until everyone is infected.



Thank you for your thoughtful reply. This was the kind of analysis I was hoping to see from other people's perspectives!

Also, happy and joyous new year to you! I hope you and your family are joyous and prosperous this year. It appears you and I are part of a minority choosing to play chess and not checkers :happy:



I'm fairly confident of two things:
  1. The stock market will see a crazy collapse (or, at the least, a hefty softening) that will bring even these stocks down.
  2. I won't be able to time the top – that's not a strong suit of mine.
Since I believe #1 pretty strongly, and I don't think I'll be able to capitalize on it, that doesn't seem like the best move for me, personally.



I believe that this will be true, but not because our lawmakers have been bestowed with superhuman rational reasoning...but because they will see the harsh impact of the decisions they made.

If they do change their course and start opening things up even if the total case + death count increases, it will be because the external reality of the economy has gotten far too terrible to ignore. To me, this is a function of when/if that happens.

This is actually the most important question to me, since my business' growth has been heavily hampered by C0VlD-19 (we currently serve physical locations that organize groups in indoor spaces). We've decided to add more features to our products that support smaller groups – something we would not have done if we felt the lockdowns/pandemic panic was stopping by Q2.

I sincerely hope I'm wrong on this, and our lawmakers come to our senses - because then playing the cards of 2021 will be a cakewalk for me.



I think we've both come to the same conclusions on this. Similar to the exodus CA and NY are experiencing, I believe an exodus to other countries is very possible in 2021.

I also believe that buying real estate in Miami will be a particularly fruitful bet (even though I think real estate overall will be a challenge), because the mayor of Miami has been doing a terrific job attracting people who are fed up with regulation and taxation.



What is the driver for this to happen in 2021? I foresee this happening in the future, but I didn't think 2021 would be the year for it.



That's an interesting driver for blockchain costs to go down but gold costs to go up. I am not sure I agree with it though. I'd have to think about it. I don't think anyone in 2021 will care at all about the energy consumption of BTC. Most people entering the market right now don't even know that energy consumption is a problem to be solved, so I can't see that negatively impacting price. I may be missing something.



Perhaps I just don't know much about inflation/deflation.

One analogy I turn to is that, if we are in prison and trading cigarettes, and someone comes with a bag of cigarettes and dumps them in the middle of the floor, the value of those existing cigarettes drops at least proportionally to the amount of new cigarettes added.

I understand this analogy is simplistic, but your assertion basically states that there are almost no consequences from printing nearly half of our 2019 GDP.

Also, it seems a main point from you on inflation is that we need to keep production levels high - but how can we do that if the meat of our economy – SMBs – are going to continue to shutter?

I'm not sayin you're wrong, just that I'd like to know more :)


Cool, thank you for commenting on my answer!

The mistake that most people make when looking at the economy is to focus on money, as such, the analogy of cigarettes in prison is wrong but it does not take into account the production of the goods inmates can buy.

The problem is that while money matters, it does not matter as much as what is produced in the economy. In fact, the first graph we learn in economics 101 is the intersection between demand and supply which fixes the price. Price is a consequence of demand and supply, not a cause. Unfortunately, most people see "money" as a cause of an economy's well being, while in fact, it is not. It is a variable that depends on what is produced in the economy.

I have written an extensive essay on money for those that wish to understand its role within the economy.

To summarize, money has four functions:

1. It is value.
2. It is an indicator of value.
3. It is an enabler of trade.
4. It is an instrument of wealth redistribution (income dictates the share of goods and services produced in the economy that you are allowed to consume. In a perfect economy, what you produce would = what you consume. Unfortunately, as an employee, it is not the case since you make your company money. As such, I explain in another article that it is not the rich that increase social-economic inequality, but the employee status).

The essay itself is fairly long, about 30 minutes.

 
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csalvato

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Thanks @Kak, I appreciate your thoughtful reply. I have been reflecting on it for a couple of hours. This is what I was looking for when I made this post because:
  1. Personally, I know that I may be living in a crypto echo chamber. Hearing your perspective has been very helpful.
  2. Other people may benefit because they are in their own echo chambers and/or feel they need to be "optimistic" without realizing they are not seeing the world as it truly is (a mistake I made in the past and have successfully avoided since)
While I think we are going to have a "crash" I personally think it will look a bit different.

Melt up vs melt down. First of all, I wouldn't be surprised to see dow 40k-50k next year. Don't pull out the champagne yet.

Mark it...

At DOW 30k, 30k buys a nice Honda Accord. $1000 buys the newest iPhone. $100 buys a nice dinner out for two who don't drink.

With the melt up I am anticipating it might look something like this...

At DOW 50k, you will notice an out of balance gain vs buying power. "Wow! I am rich I have all of this money, but why is stuff so expensive?" That nice trim level Honda Accord? (Not really a luxury good, but nice) Probably $60k now. That brand new iPhone? (A little bit more of a luxury good. Those are only for "the rich" now, probably $3500-5000.) And a nice dinner out is a TOTAL luxury good and you might see that melt up tenfold to $1000.

Your average 300k home is probably worth 500k, and once again, that appreciation would have little relative gains.

So even though all indications point to absolutely "killing it" in the markets, it matters none when we examine relativity.

This admittedly seems like a more likely scenario than the one I described. I think my assessment was coming from a belief in your next assertion (where we totally align): that people literally stop trading dollars for goods and services.

Your lead up to such an event makes more sense, which makes securities and real estate not nearly as scary. Stocks stand to gain more in a shorter period of time, but real estate will likely be a better vehicle to preserve existing wealth.

AAPL- I own a pretty big position in Apple. Why? Because they are a well run company with good earnings. It is a position I have held for years and it has treated me well... That said, while I do believe it will outperform the Dow in this scenario, it will be one of my first to go.

MSFT- I own less of this than Apple, but still a large position. An oligarch tech giant with strong ties to government. Strong earnings and relative to the nutjob holdings some people have, a relative bargain. I believe it will outperform the DOW in my scenario as well. I might hold this one longer than AAPL, but it will probably be the second holding to go.

Metal Exposure- Already my largest position by far. Those of you that know much about me, know that I am a gold bug. Gold is gold. Silver is silver. They are not dollar denominated. I like it. In early 2021, I plan to split my GLD holdings in half, half going to a more leveraged position like GDXJ that will essentially maintain that upside in my trading account as I also take the other half and acquire a LOT more physical bullion.

VXUS- I own a large position in this. This is a Vanguard international total market fund that is a great play for the weak dollar. Pretty easy to describe. Stocks in foreign countries. This will rocket at that aforementioned inflection point. This is where my investments in AAPL and MSFT go when I do sell them.

VWO- I own a smaller position in this. This is a Vanguard emerging markets fund. Emerging markets also stand to gain quite a bit by a dollar crises. The strong dollar has historically made things difficult for emerging markets and the opposite is also true. These markets are also usually countries that are used to a crappier standard of living and thus can ride out a financial shit storm more comfortably.

REET- I own this. This is a broad scope international real estate investment trust. These are leveraged. This trust owns leveraged hard assets. Weak currency is really good for people who own hard/useful assets with leverage. It is exposed to the USA unlike VXUS and VWO, but I believe it will outperform.

XOM- I recently added this position. Why might you ask? With Biden coming to town and green new deal, electric cars yada yada... Because the road to hell is paved with good intentions. I see a massive cut in supply at the hand of world elite and a relatively stable inelastic demand. Rising oil prices are good for XOM like rising gold prices are good for GDX and GDXJ. Fossil fuels are in no way irrelevant yet and with the socialistic direction of our world, viable alternatives that can exist without life support will come slower to the party than anticipated. The Fed can't print commodities or utility.

I appreciate this breakdown of funds/assets you think are worth exploring. I was looking for alternatives to Bitcoin to investigate, and the rationale here seems sound enough to investigate more. Thank you!

Bitcoin- I know @csalvato is a massive bitcoin bull, but I just don't have the balls to do what he does.

Hah! I appreciate the compliment, though I think that the reason I am looking at BTC as the only viable investment is because I am in a crypto echo chamber. I don't intend to reduce my BTC position (it's currently where I have concentrated my bets), but based on your posts, I'll likely explore other avenues vs aggressively and exclusively expanding my position in 2021.

Guns and Ammo- This goes without saying. Being able to take your safety into your own hands in a scenario in which society as we know it melts down. Trusting cops with your safety is stupid anyway. These items will be INVALUABLE. I have NEVER been such a free spender on guns and ammo as I have in 2020. I rationalize it like this... My net worth didn't move with these purchases. I can sell all of these items, already, for more than I paid for them.

You raise a good point about purchasing things that have utility that will retain (or increase) their value. Another example that comes to mind is home fitness equipment, for example.



Aside from investing cash in different assets, I really do need to consider where I want to focus my time (i.e. my entrepreneurial energy).

Our current offerings aren't compatible with lockdowns. We have been serving and strategizing on how to serve facilities that offer group activities. We have largely been staying the course, optimistic that things will re-open.

Since we don't believe that will happen, we are planning to expand our offers into things that are more lockdown-compatible – serving those same facilities and organizations for smaller groups + private 1:1 activities.

We believe this will also bring joy to the parents and children we serve, while providing a way for our customers to make more money than they would without us.

This is a risk for my business, but we are doing our best to mitigate it.

Since time is even more valuable than money, I'm really interested to see if anyone has a rationale as to how/why lawmakers will relax restrictions before the end of 2021. I don't know if such a rationale even exists :happy:
 
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Kak

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Thanks @Kak, I appreciate your thoughtful reply. I have been reflecting on it for a couple of hours. This is what I was looking for when I made this post because:
  1. Personally, I know that I may be living in a crypto echo chamber. Hearing your perspective has been very helpful.
  2. Other people may benefit because they are in their own echo chambers and/or feel they need to be "optimistic" without realizing they are not seeing the world as it truly is (a mistake I made in the past and have successfully avoided since)


This admittedly seems like a more likely scenario than the one I described. I think my assessment was coming from a belief in your next assertion (where we totally align): that people literally stop trading dollars for goods and services.

Your lead up to such an event makes more sense, which makes securities and real estate not nearly as scary. Stocks stand to gain more in a shorter period of time, but real estate will likely be a better vehicle to preserve existing wealth.



I appreciate this breakdown of funds/assets you think are worth exploring. I was looking for alternatives to Bitcoin to investigate, and the rationale here seems sound enough to investigate more. Thank you!



Hah! I appreciate the compliment, though I think that the reason I am looking at BTC as the only viable investment is because I am in a crypto echo chamber. I don't intend to reduce my BTC position (it's currently where I have concentrated my bets), but based on your posts, I'll likely explore other avenues vs aggressively and exclusively expanding my position in 2021.



You raise a good point about purchasing things that have utility that will retain (or increase) their value. Another example that comes to mind is home fitness equipment, for example.



Aside from investing cash in different assets, I really do need to consider where I want to focus my time (i.e. my entrepreneurial energy).

Our current offerings aren't compatible with lockdowns. We have been serving and strategizing on how to serve facilities that offer group activities. We have largely been staying the course, optimistic that things will re-open.

Since we don't believe that will happen, we are planning to expand our offers into things that are more lockdown-compatible – serving those same facilities and organizations for smaller groups + private 1:1 activities.

We believe this will also bring joy to the parents and children we serve, while providing a way for our customers to make more money than they would without us.

This is a risk for my business, but we are doing our best to mitigate it.

Since time is even more valuable than money, I'm really interested to see if anyone has a rationale as to how/why lawmakers will relax restrictions before the end of 2021. I don't know if such a rationale even exists :happy:
Likewise man, I always make sure to pad my ecochamber otherwise I would be in ALL METALS. LOL

I elaborated on this post here for today... Figured I already prepared something in depth enough for this thread to talk about it a bit on the show!

 

ljean

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Heres my exposure as of 1/1/2021

%
Engineering & Construction
13.4%​
Biotechnology
6.9%​
Residential Construction
5.9%​
Specialty Retail
5.3%​
Broadcasting
5.0%​
Information Technology Services
4.3%​
Oil & Gas Midstream
4.1%​
Drug Manufacturers - General
4.1%​
Grocery Stores
3.2%​
Apparel Manufacturing
2.9%​
Discount Stores
2.2%​
Semiconductors
2.1%​
Telecom Services
2.1%​
Communication Equipment
2.0%​
Oil & Gas Refining & Marketing
1.9%​
Building Products & Equipment
1.8%​
Lumber & Wood Production
1.7%​
Consumer Electronics
1.6%​
Specialty Industrial Machinery
1.6%​
Semiconductor Equipment & Materials
1.6%​
Industrial Distribution
1.6%​
Household & Personal Products
1.5%​
Specialty Business Services
1.5%​
Leisure
1.5%​
Packaging & Containers
1.4%​
Personal Services
1.4%​
Infrastructure Operations
1.4%​
Furnishings Fixtures & Appliances
1.3%​
Software - Application
1.3%​
Publishing
1.2%​
Electrical Equipment & Parts
1.2%​
Home Improvement Retail
1.1%​
Medical Care Facilities
1.0%​
Pollution & Treatment Controls
1.0%​
Metal Fabrication
1.0%​
Entertainment
1.0%​
Drug Manufacturers - Specialty & Generic
0.7%​
Auto & Truck Dealerships
0.6%​
Recreational Vehicles
0.6%​
Auto Parts
0.6%​
Utilities - Renewable
0.6%​
Oil & Gas Equipment & Services
0.6%​
Electronics & Computer Distribution
0.5%​
Aerospace & Defense
0.5%​
Internet Retail
0.5%​
Electronic Gaming & Multimedia
0.4%​
Internet Content & Information
0.4%​
Real Estate - Diversified
0.3%​
 
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biggeemac

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I will probably echo many of @Kak s opinions on this. Our business had a very nice 2020. Not only did we remain open, we were actually told by our local government that we weren't allowed to shut down during Covid because our business is VERY essential.

I believe diversification is going to be what saves us and separates those who see a very poor 2021 and those who do not. I decided to keep my day job once Covid came into the spotlight. We have two main streams of income.

We purchased some 1.6 acres up the road by the river. I am currently sitting in a lot of cash which will be dumped into developing this property.....our family "fortress". It will consist of a 5400 sq ft ICF/concrete house, complete with a full basement, professional kitchen, and movie theater, and plenty of room and storage for our hobbies. The property is also large enough to build a smaller house as well. I wanted something that the kids could come running back to if things get really bad. We can grow food, and cook a very satisfying meal. After that, we will continue expanding our business to include other links in the chain. It will be our "money tree", which will allow us to get into other businesses, or simply invest.

I am interested in purchasing some property outside of the US and establishing dual citizenship at some point.

I watched bitcoin ever since the beginning ($1 Bitcoin). I have lost many times with crypto. I'm just not very good at it. Bitcoin made millions for many people, i'm just not one of them......so I am sticking to what I know. Maybe its slower, but so what? I know that my investment will probably NEVER take a 50% haircut overnight.....unlike crypto. We net 18k a month with our business, give or take, after all mortgages and expenses, and much of our income is tax free. Crypto made some people rich if they timed everything right and had the discipline to HODL.

Above all else, learn to live a simple life. Watch a little TV or gaming, but learn to enjoy growing food and cooking it. Learn to enjoy MAKING things with wood, metal, electronics, or machinery. Learn to do things the way it was done 100 years ago. Its cheap, its satisfying, its healthy, and you can have a good life while everyone else stresses themselves to death.
 

socaldude

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What are you guys talking about? The Fed said we are growing 4% this year. The economy will get so “overheated” and “boomed” that we just might have 2% inflation. But who cares about inflation right? What’s that?:)

But in all seriousness, I think we can count on “more” of the trend in the last 50 years. Higher asset prices and bigger wealth gap.

But our financial system will be the last thing to collapse. We have unlimited money printing. We also have help from foreign central banks to protect the dollar. Yes, plunge protection team. :) The FIMA repo facility.
 

biggeemac

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What are you guys talking about? The Fed said we are growing 4% this year. The economy will get so “overheated” and “boomed” that we just might have 2% inflation. But who cares about inflation right? What’s that?:)

But in all seriousness, I think we can count on “more” of the trend in the last 50 years. Higher asset prices and bigger wealth gap.

But our financial system will be the last thing to collapse. We have unlimited money printing. We also have help from foreign central banks to protect the dollar. Yes, plunge protection team. :) The FIMA repo facility.
I have no issues with paying off my real estate and other debt with inflated dollars.
 
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JByers210

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Why did you wake up on the New Years and decide to post this? Go enjoy life
Oh you’re so full of wisdom thank you for visiting an entrepreneur forum and leaving your little carefree comment on a post that was actually very thought through and interesting to read.
 

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Oh you’re so full of wisdom thank you for visiting an entrepreneur forum and leaving your little carefree comment on a post that was actually very thought through and interesting to read.

He's smoking a stogie on his yacht just ruffling up some feathers, I'm a bit worried for our freedoms, Ontario right now is in a FULL lockdown.. it's been over a year, politicians were saying it's just for this 2 weeks. Ok fine let's do this temporarily and figure out what's going on, meanwhile Canada accepted flights from China during these lockdowns...

tenor.png

We should be free to do as we please, let the paranoid and scared people stay at home while the majority of the population continues on with their life.

With the BLM protests that happened last year, I'm going to guess that alot of people will start protesting more and more about these lockdowns with the potential of it turning violent the way things are turning out. I'll be paying attention to the news for the next couple of months.

Ford slams anti-lockdown protesters outside his home as 'buffoons;' begs them to stop​


TORONTO — An angry Premier Doug Ford lashed out on Friday at anti-lockdown protesters outside his home, accusing them of intimidating nearby residents and saying their actions wouldn't sway him.

Not sure how they even found out where he lives... but this has happened to a few other government officials in Canada.

Angry mobs with pitchforks....



Here's a comedic way to start the year off!
 
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j0elsuf

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2021 itself won't be too much different from last year.

However, as the decade of the 2020s itself progresses, we're gonna see a lot more unemployment and a lot more authoritarianism in the west.

As someone with a background in history, this kind of stuff has cycles. We're seeing just the start of an era where the west will be just like most Asian places where we will have authoritarian leaders with authoritarian policies and acts. It'll be under the guise of providing safety and free stuff but it'll be pretty much like North Korea lite.

It's gotten like this back in the day (World War II era: Dat Nationalism and Dictatorship cuz of the Great Depression) and it's only a matter of time before it gets like this again. Fortunately, it's very telegraphed so it's whatever. Plenty of time to prepare.

In fact, I'll go on to say that pretty much any developed country is gonna be a variation of North Korea as the decade progresses. People are too scared to be free and they are too scared to fight for their freedom and literally put their lives on the line for it. When it comes to stuff, protests don't do enough. Gotta have a bloody revolution/coup. Kinda really don't see that happening...ever.

As far as the economics go, the west will see a lot of unemployment and a currency crisis probably. However that won't be in 2021 that will probably be towards the end of the decade. 2nd Great Depression, stuff like that.

Either way, it'll suck to be in the west (US, West/North Europe, Canada, Australia) in the 2030s. The second I'm paying off my debt I'm moving my happy a$$ to Southeast Asia. At least the authoritarianism there is somewhat micromanaged. Not like what's gonna happen here in the US which will pretty much become North Korea in a decade lol.

This virus has had people develop a more irrational fear for their safety than ever and they'll gladly take authoritarianism/totalitarianism to provide "safety" at the expense of their freedom.

It's like George Carlin said: People are more willing than ever to trade away freedom for the feeling/illusion of security. Meh. Nothing I haven't noticed over the last 20 years really. It all started with the Patriot Act now its come to this. Oh well, I'll just get my happy a$$ to a place where I can be one ounce more free.
 
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BellaPippin

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I feel so out of my league in these type of posts and it scares me because I won't be able to prepare accordingly. It's even more confusing when you're not sure what exactly is that you don't know so you can research it. x__x
 

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As someone with a background in history, this kind of stuff has cycles. We're seeing just the start of an era where the west will be just like most Asian places where we will have authoritarian leaders with authoritarian policies and acts.

When in US history did this happen for this to be a cycle? Or did I misunderstand.

The Southern States would rather blow everything up before bending a knee to something of that caliber.... or that's my perception anyway. The states government will filter out anything remotely unconstitutional.

As someone coming from the outside from a place that has had its government use the constitution like toilet paper I have faith in this country. ...Except when I see dumbasses with nazi flags I cannot wrap my head around that...
 
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csalvato

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In order to challenge my own beliefs here, I went looking for reopening plans for the country and several states.

I was hoping to see that there were plans to reopen that didn't rely purely on infection rates or the number of cases. At the least, I was hoping to see that these plans have been updated relatively recently.

Most of the states haven't even revisited how they evaluate reopening criteria since April - back when we knew almost nothing about the disease.

They are all still using infection rate (i.e. total case count and rate of increase in cases) as the marker for when we can relax restrictions.

If they stay true to this, this is support that we would need 60-80M+ infected cases or confirmed inoculated citizens to achieve a decline in infection rate that would make regulators happy to open doors in most states.

Aside from 2-3 states, the rest are being pretty heavy-handed with lockdown orders.

Based on this, I think a meaningful reopening before the start of Q3 2021 is very unlikely. Possibly not even by the end of Q4 2021. This is (sadly) consistent with my previous assessment.

I am really interested if anyone has dissenting opinions on the timing of reopening the economies of the world.

PS - China is already back to hanging out in bars and having concerts, with GDP growth north of 5% (I believe I saw 8% in one report, but don't quote me on that).
 

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When in US history did this happen for this to be a cycle? Or did I misunderstand.
It's difficult to go into the details of all of it without writing an entire essay on it but there were times when US citizens had their freedom taken away. Then it was given back, then it was taken away again and so on.

That's what I mean when I call it a cycle. People swap their freedom for security for a bit, then they realize how inconvenienced they are, then they do stuff to gain their freedom back, then they get scared of something so they swap their freedom for security again, and it goes on and on.

Last time something like this happened was September 11th with the Patriot Act. But it was so off-the-radar that no one batted an eye. Things are more demonstrable now.
I think a meaningful reopening before the start of Q3 2021 is very unlikely. Possibly not even by the end of Q4 2021. This is consistent with my previous assessment.

I am really interested in anyone has dissenting opinions on the timing of reopening the economies of the world.
Well I want things to go back the way they were in Q3 of this year but tbh what we're seeing now is gonna be the industry standard.

If things do get back the way they were, it won't be until 2025 or so. But I'm not counting on it.

However, I DON'T see ANY state in the US doing what China did. The US government knows what will happen if that does happen and none of them want to see a bloody revolution to take place...which would probably happen if a legit stay-at-home order was instituted.

So it's either gonna be stay-at-home lite like now for the next 5 or so years or we'll see a meaningful reopening before then where everyone gets sick from this thing and it'll be herd immunity or bust.
 

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So it's either gonna be stay-at-home lite like now for the next 5 or so years or we'll see a meaningful reopening before then where everyone gets sick from this thing and it'll be herd immunity or bust.

I can see this too, but maybe I'm too optimistic to fully accept it right now :happy:

Back on 12/1/2001, I don't think anyone anticipated that the increased airline security would mean required pat downs and/or x-rays just to get on a plane by 2015, with people happily paying money into a government racket to "fast track" through all the security screens.

It could be that I'm that guy on 12/1/2001, too naive to accept that we are truly entering a "new normal" that will last for a very long time.

Either way, that makes me feel good about the bets I'm placing in my business and investments.

I feel so out of my league in these type of posts and it scares me because I won't be able to prepare accordingly. It's even more confusing when you're not sure what exactly is that you don't know so you can research it. x__x

If I had to guess, you're simply not the personality type of an analyst. That's OK. Talking in Meyers-Briggs terms, you're likely more of a "Feeling" personality as opposed to an "Thinking" personality.

You may want to take the quick and dirty Meyers Briggs test at 16personalities.com to get a feel for that.

There's no problem being a feeling personality and being a good entrepreneur.

My strength as an analyst (specifically as an ENTJ) is looking at the big picture and drilling that down into specific decisions to drive outcomes. That's why I focus on this stuff.

As a feeling personality, you will just need a different approach for your success - something you probably already knew.
 
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Martzee

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In order to challenge my own beliefs here, I went looking for reopening plans for the country and several states.

I was hoping to see that there were plans to reopen that didn't rely purely on infection rates or the number of cases. At the least, I was hoping to see that these plans have been updated relatively recently.

Most of the states haven't even revisited how they evaluate reopening criteria since April - back when we knew almost nothing about the disease.

They are all still using infection rate (i.e. total case count and rate of increase in cases) as the marker for when we can relax restrictions.

If they stay true to this, this is support that we would need 60-80M+ infected cases or confirmed inoculated citizens to achieve a decline in infection rate that would make regulators happy to open doors in most states.

Aside from 2-3 states, the rest are being pretty heavy-handed with lockdown orders.

Based on this, I think a meaningful reopening before the start of Q3 2021 is very unlikely. Possibly not even by the end of Q4 2021. This is (sadly) consistent with my previous assessment.

I am really interested if anyone has dissenting opinions on the timing of reopening the economies of the world.

PS - China is already back to hanging out in bars and having concerts, with GDP growth north of 5% (I believe I saw 8% in one report, but don't quote me on that).
States cannot and will not keep businesses closed forever. At some point, sooner or later, they will start reopening. And it may start happening next year (2021) easily.

I keep saying that Covid is the same as flu (which drives sissies and snowflakes mad). I am not comparing it to the flu in its nature of whether it is more dangerous or not or whatever but in its basic behavior:

1) It is a respiratory disease same as flu.

2) It will stay with us forever, the same as flu stayed since it occurred for the first time in 1918. We have to learn to live with it and protect ourselves. Digging ourselves in caves is not a solution and it will not remove Covid from the surface of the earth.

3) Covid will be developing into new strains the same way as flu does and vaccine makers will be trying to predict the strain mutation and predicting how strong the strain will be in the next flu season, the exact same way they do with flu (for example, the vaccine for 2020 was only 20% effective and elderly people had to be vaxinated twice to boost their immune system).

4) The vaccine will shorten the herd immunity development, the new strains will extend it. Many healthy people had covid and do not even know it, this will help developing immunity to the new strains in the future.

5) Every year, approximately 70,000 Americans died from flu complications, we have to learn to live with the fact that on top of that, there will be another ... what... 150,000 Americans dying from Covid, MERS, Sars, cigarettes, car accidents, cancer... you name it. It is sad but it is a sad truth and creating media hysteria (or as Bill Mahler named it covid porn) about it won't help anyone. It is a known fact that if we keep basic procedures such as keep 6 ft distance, wear the mask, and wash the hands (I am still baffled seeing many Americans visiting public restrooms, and not washing their hands when leaving - of course, talking about the male population, not sure if ladies are the same pigs as men) the virus will not spread. Closing businesses because of this won't work. You close it today, maybe mitigate the spread but it will come back as soon as you reopen. Now, since we have the vaccine, the entire 2021 will be dedicated to vaccinating people and that will move things in the right direction. Even with the new strains the scientists are already studying the virus and developing an updated vaccine (which may follow soon after).

6) The HVAC industry (at least what I could see here in the US) is adopting standards for better air treatment in buildings (public offices, schools, etc.,) to increase ventilation and air quality filtration (something engineers were calling for for years, and building owners were rejecting because of the filter and maintenance cost). Now everybody agrees that buying a filter that costs $36 and prevents spreading Covid (plus a bunch of other stuff) than the $14 dollar one which was catching pollens only is finally a good way to go.

I don't think 2021 will be another shit show, definitely not because of the Covid. But... we have our incompetent politicians and they may come up with something to screw things up. But that is something unpredictable.
 
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BellaPippin

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I can see this too, but maybe I'm too optimistic to fully accept it right now :happy:

Back on 12/1/2001, I don't think anyone anticipated that the increased airline security would mean required pat downs and/or x-rays just to get on a plane by 2015, with people happily paying money into a government racket to "fast track" through all the security screens.

It could be that I'm that guy on 12/1/2001, too naive to accept that we are truly entering a "new normal" that will last for a very long time.

Either way, that makes me feel good about the bets I'm placing in my business and investments.



If I had to guess, you're simply not the personality type of an analyst. That's OK. Talking in Meyers-Briggs terms, you're likely more of a "Feeling" personality as opposed to an "Thinking" personality.

You may want to take the quick and dirty Meyers Briggs test at 16personalities.com to get a feel for that.

There's no problem being a feeling personality and being a good entrepreneur.

My strength as an analyst (specifically as an ENTJ) is looking at the big picture and drilling that down into specific decisions to drive outcomes. That's why I focus on this stuff.

As a feeling personality, you will just need a different approach for your success - something you probably already knew.

I am ENTP... I just obviously lack a lot of knowledge in economics/finance and never really knew where to start besides my ECON 101 in college lol

As an ENTJ definitely you can see several steps ahead which I struggle with. I'm sort of better at making decisions on the go as things happen.
 
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