Apples versus Oranges.

Kia Ora,

It is the same old story. People are not comparing apples with oranges often especially the sales people  or brokers (one I heard from Robert Kiyosaki is they are only called brokers because they are broker than you).
Or as someone said (I believe it may of being Warren Buffett) Wall street is the only place that people go to in a Rolls Royce to get advice from someone who gets there on the subway.

Anyway back to subject at hand. Comparing apples with Oranges.

In the last blog I talked bout my hotel room. Now this was a good starting investment & therefore I was looking for more of the same to give me a passive income to allow me to concentrate on getting the security business moving.

Now when I looked at these properties that are similar in set up though not a hotel they were not as good as the one I had by a long way.

They were grossly overvalued, claimed a return that on the face of it was about the same of the one I had. But there was a huge difference. Where as the one I had was set up to pay the rates, body corporate & insurance all from the hotel operations, this new one only paid the insurance (because you cannot insure then individually & the hotel/entity cannot raise a loan against them as they are essentialy like Maori land, a lot of owners) & that changed the return quite markedly. Then the bodycorp fees were way out of proportion compared to the one I had.

There was also an expense that seemed to be at the point of legal dispute.

This all though points to being able to buy them at a greatly reduced price. The one I talked about in the previous blog finally was sold for $44,000 I believe down from the $192,000 they originally paid for.

Best thing that could happen for this entity would be one buyer of all units with a plan that ensures they are all occupied.

You get the same situation with anything. For example when I first bought silver within a month the value had jumped nearly $9,000 as the price had gone up US$2.50 plus but the exchange rate had not moved. Since then though at times though there has being large movements in gold & silver the exchange rate has also moved, resulting in a loss if you had to cash it in.

So that price you buy might not be the same as someone who buys higher as the exchange rate may make their purchase less.

Now that situation will remain as the US dollar will continue to loose value thanks to all the printing of money, with occassional rises in that value. So with all that how in the long run are we planning to gain with gold & silver.

Well it has being estimeted that when the exchange rate hits .85 if it remains there for any length of time then NZ businesses will start falling over as it affects our exports.

Therefore we know that the NZ Government is going to have to step in to lower value of NZ dollar to keep economy moving in some fashion.

You look at the world environment & you see China doing something similar by buying resources & commodities as it's greatest threat is from its people. 

As the worlds economies are struggling civil unrest & feeding people are going to be issues.

So back to the gold & silver once the government steps in to assist our exporters, you are going to benefit & know that once it has hit that magic .85 any further rises of the metal prices you will benefit. In the meantime it makes it cheaper to buy with high exchange rate.