The Need To Get Out Of FIAT
Rand performance against GBP showing that this trend is only going to continue.
Yesterday I had my house in Durban evaluated as it is being readied to go onto the market hopefully within the next 2 months. The flood damage caused a couple of months ago slowed things down and raised the costs as the insurance like in most cases covered the basics.
Dollar /Rand back in 2004 compared to now below. That is a swing of more than 120% loss.
Back in 2004 I bough the house after returning from the UK and what I paid to the current evaluation is a 350% return. Not bad if you look at the amount but realistically I have lost ground as the exchange rate back then was roughly 11.5 GBP to the Rand and is now just on 20 GBP to the Rand. This means the 350% is more like 50% and puts things into perspective and this is not great.
I went online and checked what the old house I sold in the UK is worth this morning and that has increased by just over 250% so it just goes to show how bad an investment this really was. The Rand is losing ground faster than people realise which is alarming as you could quite easily be trapped with nowhere to go as what you have is worthless.
This was an 18 year investment and that is a long soak as it is most likely the most expensive purchase you will ever make. Imagine that time if it was invested in Crypto what sort of returns you would be looking at as that would be mind blowing.
18 years for 50% is shocking as that is what it equates to against foreign currencies who have remained firm and stable. This is why it is best to leave your whatever you have in USD or GBP and to not convert as even though you are losing in general you are losing at a slower pace than other currencies.
What is an eye opener is if this had been put into a compounded interest stake at a low of 5% with an annual compound which is crappy compared to what we know today. This investment would be 2.5 x larger today. That is a 5 x better return than what I am expected to receive once the house is sold.
The positive spin is these funds can now be invested and I am hoping the Crypto markets remain flat for some tie so the timing is decent and I can play catch up and claw some of the losses back. Time to put pressure on the builders and agents who are working with the property as timing is everything.
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