wing_zealot wrote:
You’re missing the key part of his post
“as long as any investment I made instead of paying cash is at least keeping up with inflation I'm well ahead”.
You’re comparing interest to inflation, he’s comparing interest to ROI. I don’t know about him but the ROI on my investments have beat inflation (and my interest rate) several times over for quit awhile. We are however in new territory now.
Yes, if you overpay something today and it is worth more tomorrow, than you are dollars ahead. But, there usually is a day of reckoning, when prices return to "normal" (whatever that means, lol).
Remember that housing bubble we had years ago? Cheap money made overpriced homes affordable, but when home prices retreated back to "normal levels" (mortgage balance now exceeds value of home), what happened? It was cheaper for many homeowners to walk away and start over. Negative ROI?
If one is a savvy investor, your overall portfolio performance should be up (in both up and down markets), but among the winners will be losers; you have a paper loss if not sold--real loss if sold. Savers on the otherhand are being eaten alive when interest rates are well below inflation.
