đ¨Â New Article đ¨ - The Inside Word #8 W/Blake From Fire With A Family
In my latest instalment of The Inside Word, I had a chat with Blake From Fire With A Family.
Blake is one of the most inspiring folks in the FIRE community. As a 33-year old father of 2, Blake has a keen passion for all things finance and investing related, and is determined to create content to help others better their financial situation.
In this interview, I picked Blakeâs brain on his investment strategy, investing with kids, his best financial moves + more.
You can read the full article via the link below âŹď¸
What Caught My đ This Week
Apple announced an additional $90 billion to its ongoing share re-purchase plan authorisation! Appleâs share count has declined by almost 4% year-over-year and by over 20% since the end of 2016.
Share buy-backs can create value for existing shareholders by increasing their percentage of company ownership by reducing the total number of outstanding shares available to purchase on the open market.
#From Around The Web
Interest Rates Rise For The First Time In Over 10 Years!
In last Tuesdayâs monthly RBA board meeting, it was decided to increase the cash rate target by 0.25% points to 0.35%. This is the first rise in the cash rate since 2010!
The RBAâs cash rate sets the interest rate that one institution charges another to borrow money and this âbase rateâ has a direct impact on how much interest banks charge their customers on their loan products. You can read the full RBA Statement Here.
My portfolio tracker: Shareshight â 4 months free for The Money Pal Readers.
On the rate hike, RBA Governor Phillip Lowe Said âThe economy has proven to be resilient and inflation has picked up more quickly, and to a higher level, than was expected. There is also evidence that wages growth is picking up. Given this, and the very low level of interest rates, it is appropriate to start the process of normalising monetary conditions.â
What have the Banks done?
Banks arenât obliged to pass on the rate increase to their customers. However, in this case, all four of Australiaâs Big Banks have announced intentions to pass on the rate hike to customers.
To get a sense of what a 0.25% hike looks like in reality, the average borrower with a $500,000, loan and 25 years remaining will see their repayments rise by $65 a month, assuming their interest rate rises from the national average of 2.92% to 3.17%.
Interestingly, not all of the Big 4 Banks announced updates to their savings account rates. NAB and Westpac declared increases to certain savings accounts, however, CBA and ANZ are yet to make any changes.
Lift your game CBA & ANZ!
3 Takeaways From Berkshires AGM
The annual pilgrimage of Warren Buffett and Charlie Munger worshipers returned for 2022 at Berkshire Hathawayâs world-famous AGM hosted in Omaha, Nebraska.
Both Munger and Buffett took centre stage for several hours fielding questions from Berkshire Shareholders, while also providing their usual business update. Buffett and Munger aged 91 and 98 respectively demonstrated their wealth of investing wisdom through a dynamic discussion that touched on a variety of important economic points.
There was a lot to unpack from the meeting, however three things stood out for me.
Buffett Is Still Anti-Bitcoin
Buffettâs stance on Bitcoin, and cryptocurrencies has remained quite firm over the years. Buffett has long criticised Bitcoin for being a non-productive, highly speculative asset class.
In this yearâs meeting, Buffett reiterated his stance on the matter in his usual direct, simplistic style. He even went as far to say that if he was offered all available bitcoin for $25 he wouldnât take it because he âwouldnât know what to do with it.â Check out this link to see Buffettâs full take on Bitcoin.
My portfolio tracker: Shareshight â 4 months free for The Money Pal Readers.
Munger was even more critical on the subject after stating that he tries âto avoid things that are evil, stupid, and make me look bad relative to someone else. Bitcoin is all three.â
Berkshire Are Buying Stocks
Berkshire was heavily criticised for not capitalising on the opportunity to invest at discounted valuations during COVID Sell-off in 2020. The conglomerate seems to have uncovered much more opportunity in the current market climate after disclosing several billion dollars worth of investments in Insurer Alleghany (Y), Chevron (CVX), Occidental Petroleum (OXY) and HP (HPQ). Berkshire also added to existing stakes Apple (AAPL) and Activision Blizzard (ATVI). Berkshire was a net buyer of shares during the year, purchasing $51.9 billion of equities and selling $10.3 billion in the first quarter.
Buffett still long term focused
It would be reasonable to excuse anyone in their 90s for shifting their focus to the short term rather than looking forward over a 10+ year time horizon. Buffett however, is a different breed.
In response to an audience question, Buffett said 'âWe havenât the faintest idea what the stock market was gonna do when it opens on Monday,â, and he has never âmade a decision where either one of us has either said or been thinking we should buy or sell based on what the market is going to do, or for that matter, on what the economyâs going to do. We donât know.â
Instead, he continues to invest in companies he believes will succeed over the very the long term by assessing their competitive position, management teams and valuation. A simple, yet proven formula largely responsible for Berkshireâs exceptional outperformance.
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