LIVING OFF DIVIDENDS & PASSIVE INCOME

Here’s a really, really good video on how the carry trade works and what implications it has on global asset prices and the global financial stability.

I think the carry trade will have to reverse at some point in the near future. Trees do not grow to the skies and financial excesses do not last forever. When the average man on the street with no financial education starts talking or investing in a particular sector, it usually marks the end of that run. (In 2000 I overheard my hair-dresser talking about internet stocks – I should’ve sold then. In early 2005, I overheard some guys at the movie theater talking about getting into the local real estate market – I sold then and I’m glad I did!)

With Japanese housewives partaking in the carry-trade now, I think its safe to say that we’re pretty close to the end of the cycle of cheap, easy money. I sold some USD and bought Yen and I’ve also invested some money in Japanese investments (a REIT and a stock ETF).

Related Posts:

• What Are NINJA Loans? I was listening to the radio yesterday and I was listening to an investment show. The announcer was talking about mortgages and I heard him mention a NINJA loan. It stands for "No Income No Job or Asset" verification! If that isn't a liar loan I don't know what is.......
• What About LOR-Lazard World Dividend & Income Fund? When I first heard about LOR, I thought it meant Lord of the Rings, but no, the topic was on Lazard World Dividend & Income Fund(LOR). I got this email from a reader: I love your blogs. Please tell me what to think about an odd stock - LOR. They......
• Is A Global Financial Meltdown Imminent? May be I've been posting too much doom and gloom in the recent past. Do I really think we're on the cusp of a global financial meltdown? No, I do not. But Telegraph does. Here's an excerpt from an article which says the meltdown has already started: If mishandled by......

• Rules To Build A Basic Stock Portfolio Our contributing writer, Tim Parker, is a stock picker who’s built a basic stock portfolio. Here, he explains his stock investing strategy. If you’re interested in The Digerati Life’s take on stock market investing, you can review this post on how to beat the average investor’s returns. Image from smh.com......
• 50+ Personal Finance, Investing, And Money Tweeps Worth Following Miranda writes for Bankling, a personal finance portal, which contains both a blog, and a tools section that contains resources like the best bank CD rates, the best savings account rates, online mortgage rate calculators, and more. These days, it's all about Twitter and the tweeple there. While many (including......
• Develop Your Financial IQ: Chapter 3, The Most Important Rule in Investing The Most Important Rule in Investing What Does Investing Mean To People? What comes in to your mind when you mention the word investing? Does it mean, putting your money in insurance, mutual funds, the stock market or even high-yield investments? Other people might only think about investing when they......

[All content is copyright of Living Off Dividends & Passive Income]

Random Posts

• June 6, 2006 -- Making Zillions
• July 24, 2007 -- Attorney Acquitted On Federal Income Tax Charges
• May 6, 2006 -- Convert Your IRA to a Roth IRA
• July 24, 2006 -- How To Ask For A Raise
• June 14, 2006 -- Carnival of Personal Finance [ or More Free Publicity]
• February 20, 2007 -- Old 401k Does Well
• June 24, 2007 -- Earn $25 Referral Fee