better a lender or a borrower be?

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better a lender or a borrower be? - 10/12/2008 12:39:16 PM

LadyEllen

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I was thinking about this the other night.

With the financial markets collapsing (the financial system maybe even yet), who is actually looking better at this time - those who have invested savings that they worked hard for ("lent" to the banks etc) which they now stand to lose out on due to inflation, currency depreciation, stock falls etc - or those who have used their credit to the max to live well whilst the savers scrimped, and from whom repayment might become ever more difficult to extract as jobs are shed; after all, one cannot get blood from a stone and hung for a sheep is as good as hung for a lamb and all that.

So in the current situation - better a lender (investor) or a borrower be?

E

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RE: better a lender or a borrower be? - 10/12/2008 12:43:06 PM

Musicmystery

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If the value of my home drops, and I don't sell it, have I lost money?

No percentage of my home is missing.

Fundamentals, folks, fundamentals.

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RE: better a lender or a borrower be? - 10/12/2008 12:57:32 PM

meatcleaver

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You know the saying, if you owe a little, its your problem, if you owe a fortune, its their problem. Certainly everyone is going to have to pay for the current debacle and the prudent are probably going to have to pay twice.

I read 25 years ago that there wouldn't be enough money in the pension kitty for my generation no matter how much my generation paid in so I never took out a pension plan and just bought property, then about five years ago I read the financial system was heading for a meltdown so with the money I had invested I withdrew and bought more property and its paid off. Yes, property is going down but not that much in desirable areas of capital cities. The one good thing about being a socialist, I've never had faith in bankers, capitalists and magic money, I've always believed in the value of real things. Maybe I've been lucky or maybe I've been smart, I don't know but I do know someone is always going to want to rent my properties and I do know that I don't have to slave away all week to help pay the taxes to bail the banks outs.

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RE: better a lender or a borrower be? - 10/12/2008 1:00:04 PM

pahunkboy

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everything we see and touch will have some other value. everything is going to be "repriced"

we have been used to a just in time economy. well just in time has now ended.

so- alot has to do with how dependent you are on others, what you can wait it out on.

I tend to doubt this will pass. I wish it would- but life isnt based on wishes.

money is like owning someones toil.   say I have $5, that $5 says someone will do $5 worth of work- -so it is a contract of sorts.

contract law is being turned on its head.
there have been so many escape clauses, and violations of what people think to be a contract.    outsourcing comes to mind.

as for houses- the prices are going to reflect an areas wage.   not much higher.

IMO too many houses have not been built- as many now live with others- rent etc.

and surely assest you can see and touch will have a consumption value.

ironically the gross domestic product contrains what you would pay you, if you rent the house that you own.

as for inflation- now the rates went down. that wont work. real inflation is much higher. IMO inflation has been 12% ish.

so owing money at a low interest rate is good-paid back in cheaper money.... assuming your income is a sure thing.

everything as we know it will change.    people who think outside the box will thrive, others will stand in line for disaster supplies...

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RE: better a lender or a borrower be? - 10/12/2008 1:01:42 PM

Owner59

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I think the saying goes ,be neither.

Makes sense.

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RE: better a lender or a borrower be? - 10/12/2008 1:02:31 PM

Musicmystery

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And those who pay attention to the same fundamentals that have always governed will do just fine.

All fundamentals, incidentally, that would have (and should have) made the sub-prime mortgages that started this mess impossible.

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RE: better a lender or a borrower be? - 10/12/2008 1:16:26 PM

pahunkboy

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So music, the riddle is can one convert a junky house that is on the busy street, into a comparable junky house that is on a dead end?

How does one skin that cat?

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RE: better a lender or a borrower be? - 10/12/2008 1:18:41 PM

Musicmystery

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A mess is a mess. Not all of them can be undone.

But if you don't cart out all that rotting trash, you're gonna have rats on top of the stink.

Sucks? Yes. Fair? No.

But it's where we are.

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RE: better a lender or a borrower be? - 10/12/2008 1:28:17 PM

faerytattoodgirl

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