JJsushi Posted August 26, 2002 Report Share Posted August 26, 2002 I disagree that property is liquid. If you need money in a hurry you just can't convert it that quickly unless you have the vehicle for conversion in place ahead of time. If you have to make it liquid on short order you are most likely going to take a hit somewhere. Whether selling it distressed, or by getting unfavorable second mortgage terms. [color:purple] I am referring to the flexibility and semblance of security that property can give you especially if you have an equity line in place. I know of people who would have never opened a home euity line now doing so because of the appreciating home values and favorable terms. Yes I agree that property given certain market environments is very illiquid but today there are many ways for a property owner to create some form of financial liquidity without an out right sale of property. color=purple> IB and commercial bank division: When I talk about IB's I'm talking about the bulge brackets (BB). Yes the industry has consolidated but those organizations like Citigroup/SSB have definitive lines in the organization. The two environment don't mix although there are synergies to feed off of. Yes the BB do lend and sometimes with disastrous consequences but on the whole they make their money from transaction business. Their bread and butter is not loans. Commercial banks bread and butter is loans. You make an example of Bancamerica but it is not a very good IB shop, especially if it has to rely on strongarming its existing clients. I no longer have access to SDC but wonder how many league tables it's in the top 10 [color:purple] My point was that the distinct lines between IB and CB are blurring and the trend is going to continue with continued consolidation. Your statement of CB and IB busines under one roof not mixing reminds me of when I first started trading and compliance was lecturing to us about the "Chinese Wall". Yeah right, I thought. Funny how those "walls" became paper when there was some serious money to be made. color=purple> LTCM: The fed didn't really help them out although they were the instigator/catalyst that got all the other firms together to bail LTCM out. Those firms have made back their money already and then some. I think it was important given the potential size of the debacle and the ripple effect it would have had on the major derivative players with such high notional amounts. It's been awhile since I've read about it so I'll refrain from making more expository comments (about which I know nothing about!). [color:purple] I only bring up LTCM as a recent significant example of the FED helping a financial firm. Even though they didn't take a governmental action to help LTCM, they still organized an emergeny session of LTCM lenders to prevent the hedge fund from failing. By doing that they did intervene in the market because it forced a stabilization of prices in the securities in LTCM portfolio (Trust me the Street knew what they owned and what trades they were putting on). The FED getting involved gave an implied "bailout" guarantee. Without that the Strret would have let LTCM fail and then picked through the pieces. color=purple> Link to comment Share on other sites More sharing options...
Guest Posted August 26, 2002 Report Share Posted August 26, 2002 Taggart: ?Just in case anybody tries to tell you that if you use index (or tracker) funds, your portfolio will end up just "average". The majority of professionals can't beat indexed funds, and with a diversified portfolio, you'll do better than over 70% of them.? I?m 100% with Taggart on this. My own experience has been that for 20+ years my funds were in the hands of 4 different brokerages, all big name prestigious companies. Not one of them ever beat the indexes and they tried everything from trackers to hedge funds and loads of weird stuff I barely understood, and if there was ever a new hot ?flavor of the month? exotic investment vehicle, then I was in it, and invariably paid the price. The one characteristic they all had in common though was that they all charged seriously hefty fees, and it seemed to me, churned the holdings at a wildly unnecessary rate. Of course they are all highly ethical and professional and one notable example where they put some of my money into a dot com and then continued to hold it without reducing the holding or selling out for a period of about 9 months until it lost 99% of its value was totally unconnected with the fact that they had sponsored the company?s IPO and brought it to market. So a couple of years ago I decided to manage it all myself. Don?t know if I have done better than they would have done as it would be comparing with the unknown. And, No I have not beaten the indexes either, though have a very heavy weighting in trackers, currently about 6% down, but there is some, probably irrational, comfort in losing my own money rather than paying someone else through the nose to lose it for me. Nonetheless I feel Elius must consult with a professional firm and not even think about relying on or attaching much credibility to musings from people like myself. There is a massive universe of investment options out there and it is essential that they are reviewed in the context of his own circumstances and objectives. Hopefully the postings in the thread will help him think about some different aspects that he might otherwise have overlooked and help him have a forthright discussion with his professional adviser and challenge him where he thinks the advice he is getting might be superficial and of doubtful benefit to him ? something I wish I had done years ago. Link to comment Share on other sites More sharing options...
Guest Posted August 26, 2002 Report Share Posted August 26, 2002 Regarding bonds, I used the word developed countries. To be more specific he should be using government bonds issued from either North America, Europe, or Australia/New Zealand. I agree totally with Wowzer. Elius should go see a professional, preferably a fee only planner. One who doesn't get paid commissions from the mutual fund companies, so therefore can give objective advice. I also think that he should meet with a tax expert in his home country who has dealt with expats before. Link to comment Share on other sites More sharing options...
gummigut Posted August 26, 2002 Report Share Posted August 26, 2002 "The FED getting involved gave an implied "bailout" guarantee. Without that the Strret would have let LTCM fail and then picked through the pieces." We definitely have different opinions. Didn't see any type of implied "bailout" guarantee by the fed. The fed did allow the people coming in to bailout the situation arrive at very favorable conditions that LTCM management may not have given over so quickly without their intervention. If the fed did not get involved, yes the Street would have picked through the pieces but there definitely would have been a significant short-term impact given the unwinding of the derivatives involved. It would have hit the derivatives market pretty hard and made things illiquid until the positions were cleared. Given the size of the bets it would have taken awhile. As for IB and CB: I'm not talking about trading floor/research/ and IB. I'm talking about IB and CB. There really is a big environmental difference and when it comes to splitting up the pie in transaction deals it really becomes a huge mess. Thus congolmerates that do have a bulge bracket (cause anything else really ain't diddly) treat it slmost as a totally separate entity with it's own rules. <<burp>> Link to comment Share on other sites More sharing options...
Guest Posted August 26, 2002 Report Share Posted August 26, 2002 ...There really is a big environmental difference and when it comes to splitting up the pie in transaction deals it really becomes a huge mess.... Sorta like Andersen before they split up a few years ago: the consulting partners, who generated far more revenue than the accounting partners, resented the bean counters getting an equal distribution. I gotta tell ya, the derivatives market is frightening. I haven't been in the corporate finance business since 1994, but even back then a lot of people were expressing concern about just how well the derivatives market is understood. Now it is MUCH bigger, the instruments are more complex, and the number of AAA counterparties are much fewer. The Fed did a study a few years ago and said (paraphrasing) "we THINK the derivatives market is safe." I'm not convinced anyone really knows. And if cracks start to appear, I worry the whole thing could come down, like LTCM, only on a truly catastrophic scale. Link to comment Share on other sites More sharing options...
sinsin2 Posted August 31, 2002 Report Share Posted August 31, 2002 5 million is not enough. After much discussion lubricated by Sangthip with successful expats ie. living in Thailand for 10 years or more upcountry....the agreed figure is 13 million. That is 30,000b per month living expenses. Pickup,visas,trips home,Occasional splurges,small business ventures (to stop yourself going crazy) Medical emergencies,robberies,being conned,changing wives/girlfriends, all have to be allowed for. Bangkok would be more expensive. As a falang with little money, the quality of life in LOS would diminish quickly for you. No money.....no respect......"Falang kee nok". Your status would be between backpacker and English teacher. Unless You are very disciplined, life could get miserable after a couple of years. You have to allow for mistakes and your priorities changing. No money.....no control...no options. Depression sets in and You blow the lot in 2 years and slink home. Link to comment Share on other sites More sharing options...
Guest Posted August 31, 2002 Report Share Posted August 31, 2002 That is 30,000b per month living expenses. I assume you're talking about a "real" withdrawal rate from his 13,000,000 b of just over 3%? In other words he would withdraw 3% each year from his portfolio, plus extra for whatever the Thai inflation rate figure happens to be. He could also manage with his savings by keeping away from the farang areas of Thailand, and living in a small farming village. Not many foreigners could or would be willing to do this though. Link to comment Share on other sites More sharing options...
sinsin2 Posted September 1, 2002 Report Share Posted September 1, 2002 Yeah. The 13 million shold generate some kind of return. (Low risk).....2/3/4%. Keep 90% outside Thailand. Once you hit 50 you need 800,000 for the O visa. "Not many foreigners could or would be willing to do this though. " I know. So how do guys think they'll survive on less in Bkkk?. Link to comment Share on other sites More sharing options...
Guest Posted September 1, 2002 Report Share Posted September 1, 2002 Any ideas on how to retire on this, or do I need to bring over the other 5, though I'd rather not. Elius is getting close to that 13 mil bt. I gather he has 5 mil bt in Thailand and the equivalent of same overseas. Link to comment Share on other sites More sharing options...
ThaiHome Posted September 2, 2002 Report Share Posted September 2, 2002 Having had this discussion with 3 long time (retired) expats in Bangkok, the figure they come up with is an income of 100K a month. This is their minimum for a retired lifestyle in Thailand. This assumes housing is already paid for, as in you have a house or condo fully paid for. Golf 4 or 5 times a week alone could run to 30K, including lunch and beer. Going out to dinner 3 or 4 times a week is another 20K. You just about have to have a car. Trips to home country, vacations outside of Thailand., etc, etc. It all adds up. Just trying to reasonable about what lifestyle you expect during retirement. Still much cheaper then in US. TH Link to comment Share on other sites More sharing options...
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