End of Year Post 2023

 Another TRANSITORY year is coming to an end. Yes, the same story as every year: Saving money for the future. Investing money to have a better life at a later stage. And not much going on that is memorable.

In fact, it is really difficult to remember anything from this year. At the beginning of the year, we were in Berlin to meet some friends and family. After that, there is a big hole in my memory. What I know at the very least is that I have vacation days that I can transfer into 2024, which means that I did not have a lot of days off this year. But, due to extended home office, it almost felt like I didn't work at all. How lucky I feel.

I looked at my plans from one year ago. I got gifted a new phone, which is great. I still don't have a new PC, but that can wait. I don't have a new matress either or anything else in that direction.

When it comes to stocks, I had my first 5-bagger. Broadcom as substantially increased in value in the latter half of this year. It even reached 1150 dollars this month. Up until the end of the first half of 2023, it had never even reached 900 dollars. And to keep in mind, this is the stock I bought in mid march of 2020, when people were scrambling to buy toilet paper.

Not only did my Broadcom shares increase in value by 5 times, the stock has been paying dividends on top of that ever since. And since I bought those shares at a very cheap price, the amount of dividends I receive are quite high, considering how much I get back in relation to how much money I put in. It won't be that much longer until I get back 10 per cent every year on top of the shares being worth more and more.

Apart from that, I bought some other investments. The main theme this year were Australian lithium stocks, which pay dividends and have a substantial amount of lithium reserves they can tap into. This will be important in the future. People tend to think that more lithium mines will open in the future, but this is a lengthy process that takes a lot of time and bureaucracy to overcome. So I'm betting on the big boys right now.

I also took advantage of high interest rates. Right now, it seems that more and more people like to buy bonds before rates sink again, but I already seized various opportunities in the first half of this year. I basically "knew" that inflation would come down again at some point and that the expectation of high interest rates would dwindle.

My wife is working part time (about 50-75% of the hours she had before) and around Easter next year, this should go down to 50% of what was still the case in August. I view this as a positive thing. We wanted to have an easier life, and I believe it is possible to live like this in a frugal way. This is what we are good at and it improves quality of life.

On a more global scale, the war in Ukraine is still going on and probably won't end in the traditional sense for a much longer time. Then we also have a new war. Congratulations to Israel and Palestine for being little babies fighting over a ball. This conflict will never come to a peaceful conclusion. As long as religious beliefs are involved, there is no reasoning that could end this. Also, I view this conflict as some sort of global "social experiment". You know those youtube videos where they enact a scene where either a baby is being abducted or a man hits a woman? This conflict is that on a global level. I'm basically waiting for some big youtuber to reveal that it was all a test: We were supposed to call it out for being a bad thing (people dying, being tortured, innocents suffering), but instead, most people failed the experiment by picking a side.

My predictions for 2024:

• Interest rates will fall eventually. Probably around the middle of the year. This will lead to an economic recovery and a bull run in the stock market. I tend to be a bit cautious and preferably err on the side of pessimism, but I think things are going to go well still.
• The conflicts in the world will drag on, both in Ukraine as well as Israel. There will be lots of talks about how China handles Taiwan, but in the end, it will just be stuff that the news channels will like to spin as doom and gloom to keep people watching
• People will again lose limbs and lives on new year's eve (pick any year in the future), and children will still die of heat exhaustion because they were forgotten in cars in summer. Some things never change.

My goals for 2024:

• Have the kitchen repaired (should happen in January)
• Have the cat's teeth cleaned and have the cat fully vaccinated (first half of the year)
• Save money for a trip to Singapore (whenever that is)
• Invest in stocks that pay dividends
• Save money specifically for future years, in order to "secure" them in case something changes in the way we decide to work
• Find a way to spend the 25 vacation days that I need to spend in a good way

I don't expect 2024 to be a groundbreaking year in any way. The predictions that Tesla stock would reach 8 dollars of EPS were complete bullcrap. Earnings are of course stagnant in this difficult economic environment. And it is already clear that next year will be the same, even if the outlook, like I said, improves. It will take time until this carries over into earnings. The only stock that will really shine will be Broadcom. But that's okay. Things will fall into place eventually.

A Hedge Against Aging

 One of the things I regret the most in life is not investing into the stock market earlier. It has to be said that investing for the first time is probably more stupid than investing when you are an experienced investor (in terms of the decisions you make then), but still, even with some beginner investments, as long as those are long term, you are usually fine in the long run.

Now that I am older an am investing in the stock market, I realise what the power of the stock market is. You can hide that power behind phrases such as "the power of compounding interest" or other fancy words, but there is actually a different way of looking at it. It is a hedge against aging.

It does not protect you from literally aging, as you will still grow old. But what it does do is this: If you don't die young, the longer you live, the richer you get. The more your bones grow weak and your back hurts, the more money your stocks will make for you. As things get tougher and you lose loved ones, at least one thing keeps working in your favour. When other things are declining, this thing gets better. Like fine wine.

If you die young and don't get to enjoy the fruits of your savings, bad for you, but at least you don't have to go through the things that suck about aging. But then again, if at least you can get something positive out of aging, then this is it. You can't manually make the stock market move forward 30 years. It is something you have to live through yourself. But the good thing is that you can let that happen "on idle". You still live your life as the main character of your own movie.

If I had invested at least some money, let's say 1000 euros per year, into the stock market for every year since I was old enough to do so, that money alone would have compounded nicely and done great things for me up until today. Not even considering the next 30 years.

Sadly, most people don't understand this superpower, and the people who would benefit most, newborns, are rarely gifted this power by their parents, who spend their money on other things.

If I actually live to see the day that I turn 70, I hope that my investing strategy was good enough to look back on my investments proudly. Of course I could also screw it all up because it's the Truman Show after all and maybe the viewers want to see me suffer. But maybe not.

The next years are basically planned for me. I know when to sell, how much to sell, and what not to sell. It's all about how things are going to play out. I don't have the slightest clue. All I know is that the last years, going back to 2017, were me catching up with time and putting an effort into investing, when between 2012 and 2016, when I already had a brokerage account but didn't understand compounding, I wasted a lot of time. And before 2012, well, there were other priorities back then.

My investing strategy is risky, as it is very concentrated, but I have to cut a few corners because I don't want to simply be able to pay the electrical bill with my dividends. It's not enough. More than that needs to happen. But I at least have time on my side, because I am not in a hurry. So no, not interested in digital currency or rich over night schemes.

As I write this, I'm waiting for my Broadcom stock to pay me a nice dividend. Thanks to all the suckers who sold me their shares in the middle of March of 2020. It's been a nice quadruple since then, even excluding dividends.

The Amazing Power of the Passage of Time

 In the past couple of months, I spent a lot of time asking questions to Chat GPT - an AI software that has incredible powers in answering questions using language. This has helped me a lot in figuring out things, especially about things that you don't know how to google.

So if I have questions about phenomena that I have experienced, but can't find the right words, I will use this Artificial Intelligence to explain if there is a word for a phenomenon and then ask why I might feel a certain way, why things are the way they are, or to explain in simple words what a certain mental concept is like.

One thing that has fascinated me for a very long time is the concept of time itself. The way in which we perceive the passing of time, and how an event can feel "like yesterday" but still be decades away in the past.

There are many powerful implications when it comes to the passage of time. Especially in combination with the power of human memory. There is a concept that Chat GPT explained to me as "temporal orientation" or "temporal" awareness, which describes a person's ability "to place events and memories in chronological order and to understand the passage of time."

Some people seem to be able to assign certain memories to a specific calendar year from very early on, but to me, it really started when I was 12 years old. That was the year when I became strongly aware of time, the year I was in, and the ability to reflect on a year that has passed and take mental notes of some of the more meaningful events that happened. That was in the year 1995. Of course I do have memories from before then, and I can assign SOME memories to specific years, but most of the time these memories are assigned to a year by some sort of association. For example: It mus have been the year 1994, because I was in 4th grade and I had that teacher, so it had to be that year.

But from 1995 on, I no longer had to construct a memory from these circumstances, I could just remember the events themselves.

One thing that has amazed me since the age of 12 is how time passes and how the perception of time passed changes over time. When I was 12 years old, an event from 1982 would have been 13 years ago, one year before I was born. As I am writing these lines, an event from 1982 is now between 40 and 41 years ago.

It feels strange because, while there is a grey mist surrounding my earliest years, I can at least recount many of those 40 years. I can come up with logical explanations as to why 40 years have passed since an event, and why it was "only" 13 years ago when I was 12 years of age. But when I think back now, 13 years seems like a laughable period of time. I think back 13 years and believe it was yesterday.

Another amazing thing about time: It is very impactful. 10 years are an enormous amount of time that impact many things in life. 10 years is an eternity in investing. You could 10x your money in 10 years without gambling, if only you invest in a fast-growing company that is not too massively overvalued when you start investing. 10 years can also make a huge difference to your looks, although there are periods in your life when your looks won't change much within 10 years at all, but other times your physical appearance will have changed drastically. So not only do 10 years matter, it also matters which 10 years you are talking about.

To some degree, it can even be scary to think about the passage of time. To give some examples: When I was a child, Christina Ricci played a young Wednesday Addams in the Addams Family movies, and now she plays an adult woman in the new Netflix series about Wednesday Addams. Aaron Carter was a child star as a singer in the late 1990s, and last year he died as a drug addict in his mid 30s. Or think of child actors such as Edward Furlong or Macaulay Culkin who are now more or less run-down middle-aged guys with mental health problems.

It leaves you wondering: Where am I going?

One of the weirdest thing, I suppose, is that fact that we (at least some of us) are very focussed on the past, but don't think too much about the future. I can't recall ever asking myself "where will I be in 2020?". The only thing I ever remember was thinking about the year 2000. But that was only because of the turn of the millenium.

What is also crazy is that I have had this blog since 2005, so I have a long library of blog entries to look back to.

When I make my "end of year posts", I only refer to an ending year,usually not a series of years. But in reality, I often think in decades. So when I am in a year, I think back to myself and ask myself the question: What happened 10 years ago, 20 years ago, 30 years ago, 40 years ago? Even before I was born.

So different things will come up in my mind: Childhood video camera footage, Sega video games, having to do a school internship, have trouble at work a decade later, and so on. Different stages of life, all connected by being on a year with the same number at the back.

And that's how all the memories rack up.

By the way, one of my biggest regrets and also my biggest pieces of advice if one had a child: Make them start a journal. Don't let that opportunity go to waste. You don't have anything left if you don't write down memories.

Other things relating to time would be to record things on video from an early age (video quality is better than ever) and to start investing very early, even on behalf of a child.

Time is very precious.