Archive for September 2023
A Retirement Income Nirvana!
Posted on: September 27, 2023
Barely a year and a half ago, the Fed fund rate for overnight lending stood at (annualized) 0.08%. Now it is between 5.25% and 5.50%.
This has tremendous positive implications for retirees who need a steady fixed income. Imagine that you are someone who has accumulated $1mm for retirement. If you didn’t want to take any risks and you invested your entire nest egg in the Fed fund (not that this is even possible), you would have a grand total of $800 a year! That’s why a year and a half ago, I had to expose my clients’ money to stock market risk, duration risk and interest rate risk just to earn some real returns.
Then the Fed realized that inflation was out of control, and geopolitically the US needed to defend against de-dollarization, so since the middle of 2022, it has driven the Fed fund rate up. At the current upper rate of 5.5%, a $1mm investment will earn one $55,000 in totally safe interest income. $55,000 vs $800 – that is quite a difference! Who would have thought fighting inflation would be a blessing for retirees on fixed incomes?
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My Experience of German Spa
Posted on: September 22, 2023
In the last three or four years since my family moved to Germany, I have slowly adopted some German health practices that might be considered unusual in America. One of these is regularly going to the Spa.
A German spa usually consists of several (dry) Sauna rooms all set at different temperatures, at least one steam room, several ice water pools, and basins to wash your feet. A German spa is a great place to subject my body to a bit of stress. I have reaped tremendous health benefits since what doesn’t kill me makes me stronger.
Heat Stress
Spas in Germany usually have a Finnish sauna room. In these rooms the going temperature is usually 90 degrees celsius. Every so often an Aufgussmeister (water pouring master) will bring a scented bucket of water and pour it on the red hot stones. The steam rises from the stones and the Aufgussmeister then does a dance to push the steam toward the patrons in the sauna room, all of them sweaty and naked. For a moment, the temperature in the room can reach 100 degrees celsius. My entire body was under heat stress. It’s said that sitting in such a sauna room for 15 minutes is like sprinting for 15 minutes straight.
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The Investment Scientist 