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Comment by whatever1 | Hacker News Reader

What market investment is not speculative?

Commodities? Forex? Stock market? Bonds? Rare art?

Investing is a horrible idea for laypeople

There's plenty of investments that aren't speculative. Speculative investments are high risk investments, not investments involving any degree of uncertainty. Bonds and broad market index funds are considered to not be speculative despite some degree of uncertainty about their future growth.

Broad market index funds are also speculative and high-risk, as many who lost 30-50%+ of their portfolio value when they needed it most during the 2008 GFC (or those who panic liquidated during the 2020 COVID crash) can attest to.

Government bonds are one of the few "safe" low-yield investments.

That is if the issuing gov does not also print a ton of cash to repay you, or default

Index funds are speculative, and yet safe enough for lay-people to invest in.

What am I missing? S&P is down 10% yearly, 17% YTD, no? When "safe" investments are looking worse than keeping your money in the bank getting hit with inflation, rational people start getting desperate and scams explode.

Anyone who has lived in emerging markets knows the sentence soon becomes "Don't invest in <previous safe investment> more than you can afford to lose."

And the last stage in such countries ends up being: "Don't put more dollars in your bank than you can afford to lose" (because your failing bank or country will confiscate it).

Until you reach this stage the number of scams increases exponentially.

Was the S&P 500 up or down and how much in 2021?

Is this really the line you are going to use to convince people to avoid scams?

I'd like you to meet Sam the Scammer: "If you would have bought bitcoin on this date in 2019 you would have been up 200% by now. You would have doubled your money in 3 years. literally."

Long term investment in the S&P500 has proven to be a good idea over decades. Things go up and down, but S&P generally has gone up on average for at least the last 50 years.

Since you asked, you seem to be missing the difference between these two distinctly different outcomes: (a) losing 10% to 17%, probably to make it back within a few years (b) losing 66%, 99%, or 99.99%, without any likely path to ever make the money back.

>probably to make it back within a few years

"probably"? Are you willing to be held criminally liable when the elderly take your advice and the S&P does not bend to your will for the next year or two due to say -- oh I don't know -- unforeseen world events?

edit: I was alluding to the possibility of c): not investing in the S&P or crypto for the duration and suffering inflation. which would have been better than a) and b) since inflation is added on top of both those losses.

I very genuinely don't understand what point you're making. Are you equating the risks of crypto and an S&P 500 index fund?

Not at all. The first post I replied to was saying index funds are safe for lay people to invest in. I'm saying index funds may not be safe for lay people to invest in in these extraordinary times. Crypto is way riskier than index funds, I agree.

Housing costs are increasing faster than inflation

Hence, sad to say, it is becoming more the case that they key to homeownership in many cities is investing in something that grows faster than inflation as well

It’s (sadly) largely the reason why I think Robinhood became so popular

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