Impact of the Fed rate cut on living cost and investment
1. It is still too early to tell if the Fed rate cut may result in a weaker SGD because USD may also depreciate. SGD is regulated by MAS (not by interest rate) to ensure the currency is stable. Inflation in Singapore (if any) may be caused by other reasons like the scarcity of commodities, oil price surge and market uncertainty (e g. US recession).
2. It is important to know the main reason for the high cost of living (COL) in Singapore. My spending habits are "Fat" and "Lean" and hence I am not utterly worried as long as we are not not in debt or chasing any luxury lifestyle.
3. One of my investment goals is to ensure the ROI (return of investment) is higher than the inflation rate. My portfolio is set to minimize volatility risk caused by the negative impact of Fed rate cut - diversify.
4. I took a long position on REIT stocks to earn dividends. The rate cut will make such stocks increase in book value (win-win). What I can do next is to monitor the market trend and buy/sell options for short term investment.
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I reflected trading experiences by writing journals. My comments are for educational purposes not financial advice.
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Devip : Is now a good time to buy in REITs? Seems that it already started to go high
ZnWC OP Devip : It depends on your investment goal and risk appetite. I own REIT stocks long ago to earn dividends.
Devip ZnWC OP : Got it, seems that you are doing in a moderate style.![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
ZnWC OP Devip : Small profit is still a win.
snoopee : when you say "your spending habits are "Fat" and "Lean", what do you mean ah?
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coz per my understanding, Fat FIRE and Lean FIRE seems to be at opposite ends.. one advocates high standard of living whereas the other, a simple and frugal living...
sorry think I missed your point somehow. would you be kind enough to help explain or clarify?
appreciate much, thanks
ZnWC OP snoopee : I called it the hybrid FIRE between"Fat" and "Lean". Actually the 4 categories are not mutually exclusive. No one said you can't have FIRE in a "moderate" standard of living - content, comfortable and yet affordable.