Hi Everyone!
I write briefly about 3 thought provoking things I read, heard or saw in the past week. I always include links in case you want to indulge more. Hope these add value to your life in some way, as they did mine!
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1.
Ray Dalio Says Real Estate is NOT a Good Inflation Hedge…and Other Downsides
On the Prof G Podcast, Scott Galloway interviews the famous investor Ray Dalio. They talk about many things but they spent a few minutes on real estate. Ray Dalio wants you to consider this when purchasing real estate as an investment: Real estate, he says, is the easiest asset to tax. Property taxes is one of the first places the government goes to raise money. Ray Dalio also comments that he likes assets better that he can “change his opinion on” (i.e. more liquid). He also says that real estate is NOT a good inflation hedge because it is much more “interest rate sensitive” than “inflation sensitive”. There is no good data, Dalio says, showing a correlation between inflation and real estate.
2.
“Memento Mori”
Toward the end of Dan Ariely’s incredible book “The (Honest) Truth about Dishonesty.” , Dan reminds us about something interesting that happened after the Romans would win a war and celebrate. Throughout the day as the Romans were marching through the city celebrating, a slave would whisper into the general’s ear: “memento mori” which means “remember your mortality”. As Dan says this was “to prevent the victorious general from falling into hubris”. He reasons that we should have something like this in modern times, perhaps renaming it “remember your fallibility” or “remember your “irrationality”.
3.
Top Economist Thinks Inflation is Here To Stay For Decades
The Wall Street Journal ran an article on Wednesday discussing how Charles Goodhart, a world renowned influential economist, predicted high inflation will be with us for decades. Because Charles Goodhart has been right so many times, many people take him seriously. He was even warning about the buildup of leverage before the 2008 crash. Charles is quoted as saying: “The coronovirus pandemic will mark the dividing line between the deflationary forces of the last 30 to 40 years and the resurgent inflation of the next two decades”.
Have a great weekend!
Best,
Phil Horigan
Founder, Leasebreak (marketplace of shorter NYC leases)
–>You can learn more about how Leasebreak can help renters and agents agents by clicking here.
–> You can learn more about what I am up by clicking here.
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