Cash Is Not King In The Current Environment

in money •  last month 

Hey Jessavers

We're living in interesting times, the great nap has come to an end and the idea of saving in your local currency and taking out debt to live is no longer going to be the order of the day. We're going to have to rethink a lot of the ways we do things and one of them is challenging old cliches.

I'm sure you've heard the saying

Cash is King

It's been around for ages in pop culture and media and is a saying that has gone unchallenged until now. In more developed nations it hasn't been questioned but I think the fact that I live in a country with a highly mismanaged economy has given me a healthy scepticism of cash and local currency.

The fact is with all this quantitative easing and government relief programs pumping debt-based cash into the system, cash is no longer king. The lockdown and the monetary policies supporting it will drive deflation in certain markets and inflation in other markets and if you're not on the right side of those changes you will be hurt financially.

I've personally kept a large chunk of my net worth in cash as I look for opportunities to speculate, I know not all of us want to do this but if you don't speculate, someone will speculate for you.

Keeping all your money in cash, means you're interesting your wealth in the monetary policy of your government, do you really think that's a good idea?

Cash is an asset class

Cash is just another form of storing wealth and since its the most liquid its the most subject to debasement which is why you need to look at other forms of wealth storage. This could be bonds, stocks, real estate, precious metals, cryptocurrency, pension funds, money markets, other fiat currency, ETFs and more.

They all have their pros and cons and you'll have to research each one to see what kind of risk you want to take and what kind of returns you feel you need from your wealth.

Cash is not a king

Image source: - landlordology.com

When is cash king?

Cash is king when it comes to living expenses and I encourage everyone to have a few months of cash to cover basic expenses and anything that you may need quick cash for, this could be 3 months or more, it really is up to how comfortable you feel, how much risk you want to take and how your finances are looking.

Most retailers will accept cash so in this regard it is king, other than that, I would cash out and cash up!

Cash is not accepted

Image source: - consciouslifenews.com

Safeguarding counterparty risk

Even if you don't want to be an investor I think its always good to own different forms of money. I own US Dollars, Euros and cryptocurrency in case my local currency goes bust.

I also own some stable coins because it provides me with the ability to get forex exposure but also get favourable interest rates from custodial services.

I know custodial services are risky, I know holding foreign currency is risky, but I know that only holding Sout African Rands is FAR riskier.

Cash is not the enemy, governments abuse of it is, we shouldn't blame the tool for the misuse by the powers that be, cash has brought us great prosperity and if it was managed properly it could have brought along even more prosperity.

However, now that we do have an exit, we may see cash collapse to be reborn into something else, who knows? For now, we still have to deal with filthy fiat as you Bitcoin maximalists like to call it.

Have your say

What do you good people of HIVE think? Is Cash still king to you? Are you spreading your risk?

So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."

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This is so true. Personally, i trade forex, i hodl cryptocurrencies and i prefer to leave my money in USD. Recently, naira reduced in value and i was happy that most of my funds were in dollars.
I don't think cash will collapse anytime soon except if one of these top countries start pushing for serious adoption which i don't see happening soon. I mean adopting crypto is like taking power from the government and central banks and giving it to people. I don't see that happening. Nice post

I don't see cash disappearing by choice, I see it disappearing by a factor of once sovereign debt hits a point where inflation keeps going up exponentially to keep up with servicing the interest, you'll quickly see countries default and their currency collapse. It only takes one to fall for this house of cards to come tumbling down

Actually, this is the unavoidable end of fiat currency. However, is it soon? I should subscribe to your fan base

I don't think it will be soon no, but that's good for us, I don't buy BTC because I hope fiat fails, but as a hedge, if it does! Welcome aboard, the Jessie fan club :)

Thank you ..

Yeah cash is ultimately a tool that replaced bartering so instead of "service for service" it's not "service for cash which you can redeem at a later date for other services". Like you say, still king in the sense of instant ability to spend, other than that, if you're not spending much, I like to keep up to 6 months I'd say in reserve at least if possible. Having said that, I've about 25-30% of my GBP in to other forms of cash i.e. cryptocurrency, mainly BTC and HIVE.

The rest now is likely to be put towards real estate purchases. I have pension pots courtesy of work so once that house is being paid off, will reassess other investment opportunities.

Did you see Goldman Sachs slam BTC mid week? Guess they don't feel the same way anymore!

It’s always good to have liquidity since you can take advantage of things like major price drops! It’s kind of fun now like taking some cash and putting it into various things and seeing which bets pay off

I’ve probably got 60% still cash and the rest split around still looking for new cash flow opportunities playing it by ear

No I haven’t kept up with the news what they say this time? A little FUD on BTC is always good for me! Buy time

Yeah I've started saving up some "cash" cash reserves again for a few dips but basically just BTC dips lol.

Have a look at Goldman Sachs "slamming" BTC:

https://www.forbes.com/sites/benjessel/2020/05/28/goldman-sachs-slams-bitcoin-and-gold-on-investor-call-crypto-community-reacts/

LOL i thought they'd come up with something new by now surly a bubble or a tulip run with no fundamentals would have shit the bed in the current economic climate. The only reason he have a system to compare BTC to is because of all the money printing

This comment of mine is going to age like a fine wine I'm sure! FUD it so they can take positions I don't think so, the race to 1 coin is as strong as ever

By 2024 if you can get 0.3 BTC you're probably a bawler, id like to be 3 times the bawler

u.s. dollars, gold, silver, and shorting S&P now , bitcoin

property/home

  ·  last month (edited)

I’d say that’s one robust portfolio you’ve got there! You’re basically a 1%er at this point. Lol can we hate you now? Tax this rich person tax hiiiiiiiim

lol, fuck ... yeah if all my bets pay off to the moon 🤣

Lol well you better be a kinder 1% than the feudal lords we have now

our tech is new but our societies are old , 'tis the issue

CEL up 53% over 7 days, damn

Thats quite a pump, but theirs been very little liquidity and as more European banks push people into negative interest rates I think people are looking to get some sort of return

yeah, they were saying something on the live chat about limited #s, i have no idea what their structure is

Cash is not King and moreover Nothing in the real world.
Yes, cash contribute a lot about our nowadays lives. But why? just because world and governments are founded and based into.
So, we've to learn about and make also business with. In a really intelligent way and helping people in same time...
Big Hugs my friend ;)

Exactly it only has value because we all believe that someone is willing to take it from us to give us stuff and since most of us can’t produce things like food we need to money to get food making money valuable

Fiat is fascism! Bottom line, Bitcoin must become the people’s money

Yes, I am happy to be part of it and here to learn how world run and others economy possibilities. The future.