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#3959·Benjamin DaviesOP, 11 days agoYou are fallible and the future is unpredictable. It is important to buy assets for significantly less than you think they are worth. The cheaper you buy something, the more margin you have for things to go worse than anticipated. This is called a 'Margin of Safety'. Paying a higher price for something inherently makes the investment more fragile and less profitable.
A crappy business can be a good investment if you get it cheap enough, and a wonderful business can be a terrible investment if you pay too much. (The dream is getting a wonderful business for cheap.)
It is important to buy assets for significantly less than you think they are worth. The cheaper you buy something, the more margin you have for things to go worse than anticipated.
According to Austrian economics, all value is subjective. How can we then know what an asset is intrinsically worth?
Dollar-Cost Averaging
Dollar-cost averaging (DCA) is when you invest a fixed amount on a regular basis regardless of market developments.
This practice can work well long term for assets that reflect the value of the entire stock market (or a big part of it).
Long term, we can expect the stock market as a whole to gain value. So if you invest part of your income every month, say, then your position will grow in the long run.
In the meantime, you get to reduce risk by not investing all your money at once. You also get to react to developments that affect the stock market and can decide to interrupt your investment schedule. But I personally like ‘boring’ investment strategies, meaning strategies that are automated and reliable.
#4143·Benjamin DaviesOP, 5 days agoMeasuring the stock market in fiat is more arbitrary than measuring it in gold.
A short video relating to that:
https://youtu.be/AGNvdN1Lw9A?si=b5vO7kx_pTRgEgrZ
I think it would be arbitrary to measure the value in any unit that you aren’t hoping to trade your asset for.
For example, if you eventually want to get gold in exchange for your asset, measure the number of ounces your asset is worth and sell at an opportune time.
If you want to get dollars, measure your asset in dollars. Etc.
#4149·Dennis Hackethal, 2 days agoBut gold isn’t fiat. The government can’t create more gold out of thin air.
I don’t see how it matters for his argument. The value of anything fluctuates.
#4148·Dennis Hackethal, 2 days agoWiener’s critique of the dollar applies to gold, too. Both fluctuate. I see no rational preference for gold following from his argument.
But gold isn’t fiat. The government can’t create more gold out of thin air.
#4143·Benjamin DaviesOP, 5 days agoMeasuring the stock market in fiat is more arbitrary than measuring it in gold.
A short video relating to that:
https://youtu.be/AGNvdN1Lw9A?si=b5vO7kx_pTRgEgrZ
Wiener’s critique of the dollar applies to gold, too. Both fluctuate. I see no rational preference for gold following from his argument.
#4145·Dennis Hackethal, 4 days agoWiener says the dollar can go up or down in value (usually down; prices usually rise).
He suggests that, due to this volatility, measuring the value of something in dollars is like measuring the width of a physical object using a rubber band. He implies that this measurement is unreliable and arbitrary because you can ‘stretch’ it just like a rubber band.
He concludes that we should measure the value of something in ounces of gold instead.
Am I understanding Wiener correctly?
Yes I think so.
#4124·Dennis HackethalOP revised 6 days agoVeritula should have some way to acknowledge an idea, including a way to show that a thread is resolved, at least for the time being, without having to comment.
Emoji reactions (#2159) are implemented as of ea482fb.
#4143·Benjamin DaviesOP, 5 days agoMeasuring the stock market in fiat is more arbitrary than measuring it in gold.
A short video relating to that:
https://youtu.be/AGNvdN1Lw9A?si=b5vO7kx_pTRgEgrZ
Wiener says the dollar can go up or down in value (usually down; prices usually rise).
He suggests that, due to this volatility, measuring the value of something in dollars is like measuring the width of a physical object using a rubber band. He implies that this measurement is unreliable and arbitrary because you can ‘stretch’ it just like a rubber band.
He concludes that we should measure the value of something in ounces of gold instead.
Am I understanding Wiener correctly?
#4141·Dennis Hackethal, 5 days agoApparently, stocks have fallen since the dot-com bubble when measured in gold instead of dollars: https://x.com/elerianm/status/1976237139185574170
Some comments suggest measuring stocks in gold is arbitrary, others say this development is simply due to inflation.
Are they right or is this development a deeper sign that the economy is in trouble?
Funny you bring this up the day gold makes its biggest single-day USD move in history 👀
#4141·Dennis Hackethal, 5 days agoApparently, stocks have fallen since the dot-com bubble when measured in gold instead of dollars: https://x.com/elerianm/status/1976237139185574170
Some comments suggest measuring stocks in gold is arbitrary, others say this development is simply due to inflation.
Are they right or is this development a deeper sign that the economy is in trouble?
Measuring the stock market in fiat is more arbitrary than measuring it in gold.
A short video relating to that:
https://youtu.be/AGNvdN1Lw9A?si=b5vO7kx_pTRgEgrZ
#4141·Dennis Hackethal, 5 days agoApparently, stocks have fallen since the dot-com bubble when measured in gold instead of dollars: https://x.com/elerianm/status/1976237139185574170
Some comments suggest measuring stocks in gold is arbitrary, others say this development is simply due to inflation.
Are they right or is this development a deeper sign that the economy is in trouble?
Some added colour:
https://x.com/philippilk/status/2016089604588290348?s=46
Apparently, stocks have fallen since the dot-com bubble when measured in gold instead of dollars: https://x.com/elerianm/status/1976237139185574170
Some comments suggest measuring stocks in gold is arbitrary, others say this development is simply due to inflation.
Are they right or is this development a deeper sign that the economy is in trouble?
The purpose of the law isn’t to minimise negatives and maximise positives. The purpose of the law is to uphold the rights of people.
#4058·Benjamin DaviesOP, 6 days agoAll drugs should be legal because people have a right to do what they want, as long as it isn’t violating the rights of others.
Drugs are a net negative for society.
#2242·Dennis HackethalOP, 4 months agoThose run the risk of turning Veritula into yet another social network like Reddit or messenger like Telegram.
This is speculation, see #4106. If it really becomes an issue, I can retire the feature or improve it.
#2466·Dennis HackethalOP, 3 months agoNot if I do reactions on a per-paragraph basis. I think that’s a new feature none of those sites have.
I plan to go piecemeal by starting with reactions to ideas as a whole, then maybe to paragraphs/block-level elements down the line.
Would this work better as a criticism of #4058? That way, the relationship between these ideas might be clearer, and there’d be the possibility of a criticism chain.
#4131·Dennis Hackethal, 5 days agoGetting someone hooked on an addictive substance to get repeat business is predatory. It’s not an honest way to do business. Even if consuming drugs was legal, maybe the selling of drugs should still be illegal.
Related to #4062, making any part of the drug trade illegal just gives gangs and cartels a leg up over law-abiding citizens.
#4131·Dennis Hackethal, 5 days agoGetting someone hooked on an addictive substance to get repeat business is predatory. It’s not an honest way to do business. Even if consuming drugs was legal, maybe the selling of drugs should still be illegal.
But that way, you pretty much ensure that only scumbags sell drugs. And they definitely don’t care about their customers.
#4058·Benjamin DaviesOP, 6 days agoAll drugs should be legal because people have a right to do what they want, as long as it isn’t violating the rights of others.
Getting someone hooked on an addictive substance to get repeat business is predatory. It’s not an honest way to do business. Even if consuming drugs was legal, maybe the selling of drugs should still be illegal.
#4094·Benjamin Davies, 6 days agoYou could think up a design for a self-replicating machine and then build it. Assuming you made no critical mistakes, you have made a self-replicator that hasn’t self-replicated yet.
It is considered a replicator based on what it can do, rather than on what it has done.
Agreed. Thanks.