In a message to Anthony about "Maestro Modem Prices!", Rod said:

RS> Well, 20% is a hell of a long term average compound rate in todays
RS> inflation regime. IMO even 10% is wildly improbable.

RS> Its a complex argument. You can NOW make a case that with the new regime
RS> of very low inflation rates again, the old idea that real estate is
RS> always the best, particularly owner occupied housing, isnt anywhere
RS> near as true as it once was. One of the fundamentals of the financial
RS> scene is that the stock market generally looks best in a low inflation
RS> environment, But you have to remember that the stock market is
RS> considerably higher risk. Particularly owner occupied housing never has
RS> the same downside risk that the stock market does. Downside risk means
RS> risk of it dropping.

IOW, higher risk shares would probably be the closest you'd get?

RS> I guess I think that in an either/or situation there is a lot to be said
RS> for the owner occupied housing still, mainly coz its still got the very
RS> favorable tax regime, no capital gains tax, and there is an excellent
RS> chance that the very low inflation regime wont be with us forever. And
RS> its the lower risk of the two anyway.

OTOH, I'm at an age where if I allocate 10k or whatever to some riskier
shares, it's not the end of the world if I do lose on it, even all of
it, as opposed to someone older and more financially committed.

RS> Corse in theory what you are supposed to be doing is doing the
RS> investment in a balanced fund which has a balance of real estate,
RS> shares and the others like fixed interest.

Yeah, Noel makes that clear too.  But would some kind of balanced
investment fund force me to invest in more real estate even when I will
sooner or later be investing in my own home?  I have been lead to
believe that you have a certain amount of flexibility in say specifying
what proportion of your cash can go into certain types of investment,
with various risks...

RS> Trouble is that all those funds have the leeches leeching off the
RS> cash flow all the time, thats what they live off.

Which brings me to another question.  Is it therefore any better
(financially) to spend the considerable time regularly observing and
learning about the stock market and doing your investments all by
yourself (through a broker), or just dump it with a manager who'll play
around with it to his hearts content and forget about all the
details?  Or should you take a longer term approach and pick on a choice
company every now and again when you've got some cash saved that's bound
to appreciate over enough time, and buy the shares, and forget about
them again for 5 or 10 or more years, a bit like real estate?

'tnt, Amfony.                                                              
                      
--- Maximus/2 2.01wb