If you have access to debt instruments you should attempt to use those to the extent reasonable....
Debt is risk and obligation. How much that is acceptable will depend on your personal viewpoint. However, many people do not treat it this way and then get all surprised when things go wrong.
Of course it takes some skills to use debt in order to actually leverage yourself into a better rather than into a worse situation, so debt is a more advanced tool than other methods of merely working off of your own resources. Many people might not be able to afford to go to college or to buy a home if they had not had the availability of credit... .. and sure, I am not saying that the credit system is a good thing for society overall necessarily.. but there are ways to use it to your advantage if you are ready, willing and able to figure out proper ways of employing it.. and it is not as complicated as other kinds of financial instruments.
This doesn't apply if you're a large corporation, of course. In that case the government just bails you out.
Maybe... But anyone can use debt in good ways or bad ways in terms of whether their investment is likely to lead to returns or if some entities and individuals might be sucking off of the public trough.. including those who get themselves in to BIG debt and then get bailed out with bancrupcy... I was not necessarily referring to abuse cases when we might be figuring out how normies can strategize in ways to potentially use debt to their advantage.
By the way, I did a quickie approximation in my spreadsheet to find that payments for such Lambo would be around $11,500 per month to pay off such $600k-ish loan in 5 years and the payoff amount would reach around $692k after the interest is calculated into the payoff amount.
Debt also accumulates. So that's 100k on top of your original payment.
Sure it is... and if a person has 100 bitcoins, then s/he may well be able to afford both a lambo and an extra payment of $100k and also to buy something that might depreciate by 1/2 in 5 years. I am not necessarily talking about building wealth from a decision to use debt to buy the lambo, but if you were going to buy it anyhow because you have $100k, you may well not be worse off to have $600k in debt for 6 years and to keep the value of 12 bitcoin in bitcoin... which currently is about $600k but those 12 bitcoin may well be worth more than $600k in 5 years... what do you think? We are not all going to come to the same decisions regarding how to invest nor how to consume... and surly I will concede that 100 bitcoin is barely into entry-level fuck you status if we are referring to our 208-week moving average.. which would put those 100 bitcoin at about 1.85 million currently (so yeah, just barely getting to fuck you status, if we are presuming $2 million as entry-level fuck you status)
Now, you may be expecting Bitcoin to appreciate to more than offset that in the intervening years but so also goes the thought processes of the gambler who is just needs to borrow 200 to put on an accumulator and pay of what he owes so that "Jimmy the hammer" won't remove his kneecaps.
If I am referring to someone who already has 100 bitcoins, then I am not necessarily referring to anyone in a desperate kind of a situation... and yeah, maybe it would be borderline consumption for someone with that level of bitcoin to be getting into a $600k loan... Of course, upkeep of a Lambo will likely require decent access to storage and abilities to afford the other costs.. maybe there is already ownership of a garage to store it and maybe around $10k to $20k per year could be estimated for maintenance.. and surely there might need to be an emergency fund too in case there might be some higher costs that could come up with the Lambo... perhaps?
Debt is also fungible. If you have a large quantity of Bitcoin and borrow to buy something frivolous, consider whether you would have borrowed that money to buy Bitcoin. No? Well, you may as well have.
I am talking about a situation in which the person had already decided to buy the lambo so the question only is whether to finance it or not. And, yeah of course, already presuming it is a consumption item and not likely to hold a lot of its value in terms of the total various costs.
I will at this point state explicitly that I am not anybody's mother and they can handle their finanaces how they please. I am just giving my angle on the matter.
Seems to me that you are fighting with the hypothetical, and sure I will concede that I might have been being a bit provocative with my use of a lambo as the example of the purchase.
Why would you not want me to get caught up on the percentages? That was my whole point to get caught up on the percentages. Yes, I know that people have total discretion regarding what they do, and even if they do dumb stuff, but if we give analysis regarding different kinds of ways to think about the matter, then we are discussing and hopefully being helpful to people (and sure maybe even helpful to myself to go through the exercise).
Percentages are useful in some cases, less so in discussions like this. A house is $X, You have
BTCY which is worth $Z, you are probably targeting particular values to own or buy. Percentages are not especially meaningful in these contexts.
Yeah.. but I thought that I explained decently well in terms of starting with 35 BTC, and then discussing the various tradeoffs and the various considerations associated with those tradeoffs in order to reach my conclusion that if I was feeling some kind of need to cash out some BTC at $55k, then I would both base it on the 208-week moving average and likely end up cashing out no more than 1.4 BTC to 2.8 BTC based on that.
So traditional withdrawal rates consider drawing out 4% per year, but I have started using a different formula based on the 208-week moving average and allowing up to 12% per year based on the 208-week moving average as long as the spot price is sufficiently above 208-week moving average and if the current 208-week moving average is around $18.3k, then $55k is about 3x the 208 week moving average so no problems in terms of the 12% per year rate based on how spot price compares with 208-week moving average... but I still would not feel comfortable cashing out more than 1-2 years based on current price performance and expectations that it is not too likely (in my thinking) that we will not get opportunities to cash out more bitcoin at or above $55k in the coming 1-2 years.. so I would consider too many opportunity costs cashing out above those amounts, which also how I got to the 1.4 BTC to 2.8 BTC maximum. Sure, if you did not really attempt to grapple with why I was talking about percentages, then you end up criticizing my use of percentages as if it were just some random idea just thrown in there for the pure sake of it.
The question is "should they be happy with what they still have?" which can only be answered on a personal level.
That's ridiculously a different topic than what I was attempting to discuss... so just seems weird that you want to go there.
Not really. I just recontextualized it.
I think that you made a new topic.. but whatever.. do what you like.
If you got why I said what I did about percentages, this follows on. I never look at my sells in terms of percentages, merely if I am happy with the amount of $ I am getting for my BTC and whether I am happy with the amount of BTC I have remaining (though it would always be nice to have more, of course).
I don't really get what you were saying about percentages, and fair enough if you have some other kind of way of looking at the matter of whether to limit yourself in how much you cash out or whether you are trying to keep some kind of purposeful allocation in bitcoin. Surely, I have felt over allocated since 2016-ish.. and sure it may well not be a bad problem to have, but sometimes I still would rather be careful to attempt to account for the 4 year cycle or whatever seems to be going on in bitcoin in terms of not selling too much at the wrong time, especially if I consider that we have decent odds of UP from that location.. which would be a factor for me selling at $55k a few weeks ago or even a factor of me selling at $48k currently in the event that I would need to sell.. so maybe I would end up selling a smaller amount of my levels of allocation.. but sure, I can do whatever the fuck I want, so I can change my own limits if for some reason I am feeling an urge to consume or to invest or whatever, I am not really limited by the fact that I have more options and my BTC portfolio happens to be up about 20x to 30x higher than even my wet dream scenario of 2013/2014/2015 when I was initially starting some of my BTC investment plans and engaging in maintenance of my BTC portfolio back then.
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