vania-janet/multiturn-rag-retrieval-data huggingface dataset:
"Its definitely not a stupid question. The average American has absolutely no idea how this process works. I know this might be annoying, but I'm answering without 100% certainty.   The Fed would increase the money supply by buying back government bonds. This increased demand for bonds would raise their price and therefore lower the interest return that they deliver. Since U.S. treasury bonds are considered to be the very safest possible investment, their rate is the ""risk free"" rate upon which all other rates are based. So if the government buys billions of these bonds, that much money ends up in the hands of whoever sold them. These sellers are the large financial organizations that hold all of our money (banks and large investment vehicles). Now, since bond rates are lower, they have an incentive to put that money somewhere else. It goes into stocks and investment in business ventures.   I'm less certain about how this turns into inflation that consumers will recognize. The short answer is that there is only a finite number of goods and services for us to buy. If the amount of money increases and there are still the same number of goods and services, the prices will increase slightly.   Your question about printing money to pay off debts is too complex for me to answer. I know that the inflation dynamic does play a role. It makes debts easier to pay off in the future than they seem right now. However, causing massive inflation to pay off debts brings a lot of other problems."
Does the Spanish market, or any other market in euroland, have the equivalent of ETF's?  If so there ought to be one that is based on something like the US S&P500 or Russell 3000. Otherwise you might check for local offices of large mutual fund companies such as Vanguard, Schwab etc to see it they have funds for sale there in Spain that invest in the US markets.  I know for example Schwab has something for Swiss residents to invest in the US market.  Do bear in mind that while the US has a stated policy of a 'strong dollar', that's not really what we've seen in practice.  So there is substantial 'currency risk' of the dollar falling vs the euro, which could result in a loss for you.  (otoh, if the Euro falls out of bed, you'd be sitting pretty.)  Guess it all depends on how good your crystal ball is.
You are diversified within a particular type of security. Notably the stock market. A truly diversified portfolio not only has multiple types of holdings within a single type of security (what your broad market fund does) but between different types. You have partially succeeded in doing this with the international fund - that way your risk is spread between domestic and international stocks. But there are other holdings. Cash, bonds, commodities, real estate, etc. There are broad index funds/ETFs for those as well, which may reduce your risk when the stock market as a whole tanks - which it does on occasion.
" When you have not made it clear that any other money is being used in this investment plan (as was the case in scheme #1 and scheme #2a,) the loan still has to be paid. So, clearly the principal must be included in the return calculations. How to evaluate this proposed investment scheme Key dimensions: Loan ($8,000 ... 24 months ... 0.27% monthly rate... monthly compounding... no loan origination fees) Monthly payment (PMT in Excel yields $344.70). Investment capital (starting = $8,000) Monthly Return (Investment yields... we hope it's positive!) Your monthly contribution from your salary Taxes = 10%. Transaction Fees = $20 Go and lookup how to build an amortization table for a loan in Excel. Your life will be infinitely better for it. Now, you get this loan set up and invested into something... (it costs $20 to buy the assets). So you've got $7980 chugging away earning interest. I calculate that your break even, with you paying in $344.70 of your own money each month is 1.81% annually, or 3.42% over the 24 month life of this scheme. That is using monthly compound interest for the payments, because that's what the real world would use, and using monthly compounding of the investments' returns. Your total interest expense would be $272.79. This seems feasible. But let's talk about what your other option is, given that you're ready to spend $344.70 each month on an investment. Your other option I understand the appeal of getting $8,000... right away... to invest in something. But the risk behind this is that if the market goes down (and markets do) you're stuck paying a fixed amount for your loan that is now worth less money. Your other option is to take your $344.70, and invest it step-by-step. (You would want to skip a month or two buying assets in the market, so that you can lessen transaction costs).
First, you need to understand the difference in discussing types of investments and types of accounts. Certificate of Deposits (CDs), money market accounts, mutual funds, and stocks are all examples of types of investments. 401(k), IRA, Roth IRA, and taxable accounts are all examples of types of accounts. In general, those are separate decisions to make. You can invest in any type of investment inside any type of account. So your question really has two different parts: Tax-advantaged retirement accounts vs. Standard taxable accounts FDIC-insured CDs vs. at-risk investments (such as stock mutual funds) Retirement accounts are special accounts allowed by the federal government that allow you to delay (or, in some cases, completely avoid) paying taxes on your investment. The trade-off for these accounts is that, in general, you cannot access any of the money that you put into these accounts until you get to retirement age without paying a steep penalty. These accounts exist to encourage citizens to save for their own retirement. Examples of retirement accounts include 401(k) and IRAs. Standard taxable accounts have no tax advantages, but no restrictions, either. You can put money in and take money out whenever you like. However, anything that your investment earns is taxable each year. Inside any of these accounts, you can invest in FDIC-insured bank accounts, such as savings accounts or CDs, or you can invest in any number of non-insured investments, including money market accounts, bonds, mutual funds, stocks, precious metals, etc. Something you need to understand about investing in general is that your potential returns are directly related to the amount of risk that you take on. Investing in an insured investment, which is guaranteed by the government to never lose its value, will result in the lowest potential investment returns that you can get. Interest-bearing savings accounts are currently paying less than 1% interest. A CD will get you a slightly higher interest rate in exchange for you agreeing not to withdraw your money for a period of time. However, it takes a long time for your investments to grow with these investments. If you are earning 1%, it takes 72 years for your investment to double. If you are willing to take some risk, you can earn much more with your investments.
when investing in index funds Index fund as the name suggests invests in the same proportion of the stocks that make up the index. You can choose a Index Fund that tracks NYSE or S&P etc. You cannot select individual companies. Generally these are passively managed, i.e. just follow the index composition via automated algorithms resulting in lower Fund Manager costs. is it possible to establish an offshore company Yes it is possible and most large organization or High Net-worth individuals do this. Its expensive and complicated for ordinary individuals. One needs and army of International Tax Consultants / International Lawyers / etc but do I have to pay taxes from the capital gains at the end of the year? Yes Canada taxes on world wide income and you would have to pay taxes on gains in Canada. Note depending on your tax residency status in US, you may have to pay tax in US as well.
I have several as well, (acquired the same way as you) and I am happy with the idea.  They are very stable and that is the reason they pay so little.  I don't think you can get a low risk and medium (or high) return.  The interest does reset every six months so you do get a bit of the market, should the fed set interest rates higher, you bonds will eventually reflect that. Bonds and Certificates of Deposit are just one element of your investment portfolio.  Put the money you can't lose into bonds, the money you can into higher risk stocks. Bonds are great from our grandparent's perspective because they are NOT going to lose value. (My grandparents were depression era folks who wanted that stability)  They are trivial to give as gifts.  Most other investment forms require a heavy bit more of legal work I would think.
Buying property you intend to live in is as much a life choice as it is an investment. You will treat the property much different from the way something you rent out gets treated. It means you'll be in a better position when you decide to sell but don't go in to this because you think a return is guaranteed. Do it if you think it is what you need to achieve your life goals. Option 3 Buy bonds and shares. But I haven't the faintest idea about how to do that and/or manage a portfolio. If I was to go down that route how do I proceed with some confidence I won't lose all the money? Let's say you are 35 years old. The general rule is that 100 minus your age is what you should put in to equities and the rest in something more conservative. Consider this: This strategy is long term and the finer details are beyond the scope of an answer like this. You have quite some money to invest so you would get preferential treatment at many financial institutions. I want to address your point of having a goal of 10-15% return. Since you mentioned Europe, take a look at this chart for FTSE 100 (one of the more prominent indexes in Europe). You can do the math- the return is no where close to your goals. My objective in mentioning this: your goals might warrant going to much riskier markets (emerging markets). Again, it is beyond the scope of this answer."
Tbonds are on nobody's books when they are bought back.  Feds or Treasury department credits your account plus any interests when you sell the bonds back to them.  The Tbonds are then destroyed.  The govt is forever solvent when paying Tbonds.  They just click a few buttons and bam!! A check is written to you or your checking account is increased for turning in the matured bonds.
"First note that CIBC issued these bonds with a zero coupon, so they do not pay any interest.  They were purchased by the market participants at a small premium, paying an average of 100.054 for a nominal value of 100.  This equates to a negative annual ""redemption"" yield of 0.009% - i.e., if held until maturity, then the holder will witness a negative annual return of 0.009%. You ask ""why does this make sense?"".  Clearly it makes no sense for a private individual to purchase these bonds since they will be better off simply holding cash.  To understand why there is a demand for these bonds we need to look elsewhere. The European bond market is currently suffering a dwindling supply owing to the ECBs bond buying programme (i.e., quantitative easing).  The ECB is purchasing EUR 80 billion per month of Eurozone sovereign debt.  This means that the quantity of high grade bonds available for purchase is shrinking fast. Against this backdrop we have all of those European institutions and financial corporations who are legally obliged to purchase bonds to be held as assets against their obligations.  These are mostly national and private pension funds as well as insurance companies and fund managers.   In this sort of environment, the price of high quality bonds is quickly bid up to the point where we see negative yields. In this environment companies like CIBC can borrow by issuing bonds with a zero coupon and the market is willing to pay a small premium over their nominal value. TL/DR The situation is further complicated by the subdued inflation outlook for the Eurozone, with a very real possibility of deflation.  Should a prolonged period of deflation materialise, then negative redemption yield bonds may provide a positive real return."
You can look into specific market targeted mutual funds or ETF's. For Norway, for example, look at NORW. If you want to purchase specific stocks, then you'd better be ready to trade on local stock exchanges in local currency. ETrade allows trading on some of the international stock exchanges (in Asia they have Hong Kong and Japan, in Europe they have the UK, Germany and France, and in the Americas they have the US and Canada). Some of the companies you're interested in might be trading there.
"What is the best way that I can invest money so that I can always get   returns? Would it be to set up an FD in a bank, to buy land, to buy a   rental house, to buy a field, or maybe to purchase gold? Forever is a long time. Of the options you listed, the only one guaranteed to generate returns is a bank account. The returns may well be very small, but (absent an economy-wide financial failure) you will get the stated return. Land doesn't always retain its value, nor do rental houses or fields. Gold clearly fluctuates. But you would be better served to think about goals and how you can attain them. What do you want to do with the ""returns""? If you are trying to set yourself up for purchasing a home, paying for college, or retirement, then the small returns on a bank account may be insufficient. And in that case you might be better served by worrying more about the size of the returns you need than the certainty of them. There may be many ""better investments"" if you more clearly define what you expect to achieve by your investment."
Given those assumptions (which I happen to think are reasonable) it seems to me the obvious place is to buy non-Australian assets, such as the Vanguard VTS (total US share market) and VEU (world ex-US) ETFs, and perhaps also some international fixed-interest ETFs.   I think keeping a certain amount of cash would be prudent anyhow. If you felt very sure this was going to happen, you could borrow in Australia and buy foreign assets, expecting that as the AUD falls, the relative cost of the borrowing will also fall.  This is obviously fairly risky, not least because Australian interest rates are already high and may go much higher, and while the rates go up the exchange rate will also likely go up. As I mentioned on another answer, I think buying gold or other commodity instruments is a poor choice here because the Australian economy and the AUD is so tied to those prices already.
China is in the middle of a residential housing bubble, and now is probably a horrible time to invest in real estate in China.  Even if China wasn't near the peak of its bubble it would probably still be a bad idea because owning real estate in a foreign country is expensive and risky. There are real currency risks, think what would happen if the yuan declined significantly against the dollar. There is also the risk of the government seizing foreign held investments (not extremely likely but plausible). Another consideration is that it would be next to impossible for you to get a loan to purchase a property US banks wouldn't touch it with a 10 ft pole and I doubt Chinese banks would be very interested in lending to foreigners.
I imagine that it wouldn't affect consumer debt significantly. Individuals are separate entities from their government like how stockholders are separate entities from a corporation. It would probably make it harder for the country to raise money through bonds. Who wants to purchase bonds from a country that won't pay you back?
"10 to 20% return on investment annually. ""When I hear that an investment has a 10%+ return on it I avoid it because..."". In my opinion, and based on my experience, 10% annually is not an exageration. I start to ask questions only if one talks about return of 30% annually or more. These kind of returns are possible, but very rare.  What sort of things do we need to look out for with alternative investment? First the quality of the website and the documentation provided. Then the resume of the founders. Who are those guys? I check their LinkedIn profile. If they have none, I am out. A LinkedIn profile is a minimum if you manage an investment company. I also look for diversification and this is the case with Yieldstreet. How do we assess the risks associated with alternative investments? I would never put more than 10% of my capital in any investment, alternative ones included. I also try to find financial information on the promoter itself. In Yieldstreet case check the legal advisor. I remember an international fraud case I analyse. The promoter I investigated had seven small trust involved: in British Virgin Islands, in Panama, in Holland, in Portugal, in the United States and Canada plus a banking account in Switzerland and the biggest shareholding company in the Isle of Man. No need to talk about what happened after. The investors were all non residents in the juridictions involved and no legal recourse were possible. They lost everything. These promoters regularly change juridictions to avoid detection. As far as Yieldstreet is concerned, what I read and checked seems interesting. Thanks for your question. I will check it out myself more. I am also a very cautious investor. To evaluate alternative investments is difficult , but no need to be afraid or to avoid them. We are accredited investors after all."
The US will let you keep as much money as you want to within its borders regardless of your citizenship. You'll owe capital gains tax in the US unless you're subject to a tax treaty (which you would probably make as an election in the year of the transaction). I don't know if India has any rules about how it governs its citizens' foreign assets, but the US requires citizens to file a form annually declaring foreign accounts over $10,000. You may be subject to additional Indian taxes if India taxes global income like the US does.
The problem is aggregating information from so many sources, countries, and economies.  You are probably more aware of local laws, local tax changes, local economic performance, etc, so it makes sense that you'd be more in tune with your own country.  If your intent is to be fully diversified, then buy a total world fund. A lot of hedge funds do what you are suggesting, but I think it requires either some serious math or some serious research. Note: I'm invested in emerging markets (EEM) for exactly the reason you suggest... diversification.
"More to the point, once you've gone through the trouble to accumulate a hoard of dollar balances, what *else* are you going to do with it?  If you're not going to buy goods and services for sale in dollars, you may as well shift some of those dollar balances into an interest-bearing account, which is what ""buying US debt"" is."
"(Congrats on earning/saving $3K and not wanting to blow it all on immediate gratification!) I currently have it invested in sector mutual funds but with the rise and fall of the stock market, is this really the best way to prepare long-term? Long-term?  Yes! However... four years is not long term.  It is, in fact, borderline short term.  (When I was your age, that was incomprehensible too, but trust me: it's true.) The problem is that there's an inverse relationship between reward and risk: the higher the possible reward, the greater the risk that you'll lose a big chunk of it. I invest that middle-term money in a mix of junk high yield bond funds and ""high"" yield savings accounts at an online bank.  My preferences are HYG purchased at Fidelity (EDIT: because it's commission-free and I buy a few hundred dollars worth every month), and Ally Bank."
Yes, you're absolutely right. For such small amounts and such large fees, almost any investment choice is pointless. Some brokers allow for commission free ETF trading.  Seek them out. As you've noticed, bond interest rates are almost 0%.  This is a far cry from the days of Benjamin Graham, where the USD acted more like gold, with much more frequent booms and busts. During Graham's heyday, one could sell one's bonds at super low interest rates and buy them back again when high.  In his day, interest rates would be very high one year like in 2008 and next to nothing the next like in 2009, cycling back and forth, until the 1960s hit, and he didn't know what to do. Graham preferred to wait for the reversion to the mean, and act only when far from it.  Those opportunities are few and far between now since fiat currencies are far better managed than they were then, the Fed-caused 2009 total destruction as an outlier to recent times. In your case, it's best to leave the bonds to the insurance companies and buy equities.  If you want less volatility, buy a buy-write ETF.  Bonds will surely disappoint unless one is lucky enough to hold bonds while interest rates fall from ~6% to ~3%, an eventuality that shouldn't be expected to occur again, as Bill Gross is painfully discovering.
"Borrowing to invest is almost always a bad idea.  You'd have to take out an unsecured loan, which has a higher interest rate, or a secured loan and put at risk whatever you are securing the loan with. You need some means to make payments on the loan, or if interest is being added to the balance then take the compounding effect into account with regards to the cost of the money and how much you will really end up owning. In order to come out ahead you need to 'invest' in something that will yield a return that is higher than the cost of borrowing the money, such high yields always come with higher risk, meaning that you will actually GET that return is less and less of a sure thing.. so now you are talking about the 'chance' to make money, Or a chance your 'investment' could fail, perhaps badly.  Meaning you could well do nothing but end up in debt with little to nothing to show for it. If someone claims to have a 'sure thing' and is encouraging you to borrow money to invest in it, I'd be checking their back for a fin and remembering the lyrics ""when the shark bites ... scarlet billows start to spread"""
"Currency, like gold and other commodities, isn't really much of an investment at all. It doesn't actually generate any return. Its value might fluctuate at a different rate than that of the US dollar or Euro, but that's about it. It might have a place as a very small slice of a basket of global currencies, but most US / European households don't actually need that sort of basket; it's really more of a risk-management strategy than an investment strategy and it doesn't really reflect the risks faced by an ordinary family in the US (or Europe or similar). Investments shouldn't generally be particularly ""exciting"". Generally, ""exciting"" opportunities mean that you're speculating on the market, not really investing in it. If you have a few thousand dollars you don't need and don't mind losing, you can make some good money speculating some of the time, but you can also just lose it all too. (Maybe there's a little room for excitement if you find amazing deals on ordinary investments at the very bottom of a stock market crash when decent, solid companies are on sale much cheaper than they ordinarily are.)"