TO MAKE MONEY it is necessary that there be a gap between perception and reality. If everybody thinks that a particular event will happen and that event does not happen – the minority makes money. Similarly if everybody thinks (knows!!) that real estate and gold are the best assets, AND if this turns out to be wrong, then the people who bet on the contrary make money. Here is a long COMMENT by one of the readers…my comments are in BLOCK letters…read on:
The author has erred on many counts. History has shown that only one company (GE) exists today that was there in the when original S&P started survived in US.
AWESOME. IF YOU DO NOT KNOW TO PICK STOCKS PICK THE INDEX.
Stock market returns are based on various factors including the price at which you buy and the kind of stock that you buy. Many companies which were darling of market in yester years have been wiped out.
MORAL: STAY AWAY FROM THE MARKET, I PRESUME?
Buying a house make sense for following reasons
a) You have an asset (unlike paper assets like enron/satyam/nortel shares )
EXACTLY HOW HITLER ARGUED.
b) You will definately get more than what you invest . Tell me one person who has sold below the price what he has bought in the real estate (apart from speculators) Or in US where the population has degrown.
THIS IS TRUE FOR A SAVINGS BANK ACCOUNT ALSO. LEAVE IT THERE FOR A 100 YEARS, SB AC CAN NEVER, EVER GIVE A NEGATIVE RETURN.
c) India’s popualtion is increasing and ROTI , KAPDA and MAKAN are three things in everyone’s mind hence the demand will go up. There is scarcity of land too.
BRILLIANT. THIS MEANS REAL ESTATE ALL OVER THE WORLD WILL INCREASE AT THE SAME RATE, OR AT LEAST IN INDIA. HMMMM ….THAT ITSELF WILL REDUCE THE GROWTH RATE 🙂
d) You have lot of tax benfits if you buy home even third or fourth home . Get in touch with CA and he will tell you
THIS IS SUCH A FALLACIOUS STATEMENT, IT CANNOT BE EXPLAINED IN BLOGS.
e) Ask any rich person he will be owning lots of propeties whose value will be more than the investment in stocks .
RATAN TATA, VELLIYAN, AZIM PREMJI, NARAYANA MOOTHY, RAKESH JHUNJHUNWALA, VALLABH BHANSALI, RAHUL BAJAJ….is the list biased?
f) Stocks are good if you are very judicious investor and do a due deligence throughly , but with lots of paper stocks going around its difficult to choose one.
IMPLICATION: REAL ESTATE INVESTING IS EASY. ROFL.
g) In case of emergency , you can mortage your house and get money.
IMPLICATION: YOU CAN SELL ONE ROOM, I PRESUME?
Suggestion is that buy property better if you can buy land even if it is in far of places as you will see returns much better than any investment else your child will again say (Oh, only if my father had bought one more flat…” It was available for Rs. 2 lakhs, now it is Rs. 80 lakhs) at least its worth 80 lakhs .. if you invest in some bad stocks then 2 lakh will be 1 lakh)
AWESOME LOGIC SIR, i rest my case….
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