Tritri:



Go school And learn u no go gree..Innitial Gra gra dey worry U. ,we talking about interest rate . ur talking about compound interest , with inflation ur only money is still your 20M.

For your Info.I owe a Bonds worth over 100M...Yes and am regreting that now. why..as at then the rate was 12.54% which seems to be the best..4month later rate is 15%...who's losing?

Finally u seems very smart..Why not go put ur 20M on T.B then start dreaming how to buy a range rover because you just did blood money .


Real Interest Rate'
The real interest rate is the growth rate of purchasing power derived from an investment. By adjusting the nominal interest rate to compensate for inflation, you are keeping the purchasing power of a given level of capital constant over time.

For example, if you are earning 4% interest per year on the savings in your bank account, and inflation is currently 3% per year, then the real interest rate you are receiving is 1% (4% - 3% = 1%). The real value of your savings will only increase by 1% per year, when purchasing power is taken into consideration.


Another one


Real Interest Rate = Nominal Rate – Inflation Rate

It’s important that the real interest rate be positive so that a lender or investor knows he’s beating inflation. If the real interest rate is less than zero, then the rate being charged on a loan or paid on a savings account is not beating inflation. The lender or saver would be losing money from a purchasing power perspective.

For instance, Fred has $1,000 and wants to buy a refrigerator that costs that exact amount, but he doesn’t need the refrigerator until next year. So Fred places the $1,000 with his bank in a one-year certificate of deposit paying 5% interest. This 5% is the nominal rate. If inflation is 6% then, using Fisher’s formula, the real rate of interest on the CD is negative 1%.

At the end of the CD’s term, Fred receives $1,000 plus $50 interest. But because of the 6% inflation the price of the refrigerator is now $1,060. Fred’s $1,050 is now not enough to buy the refrigerator. From a purchasing power perspective, Fred actually lost money over the one-year term

@Chukzyfcb As i said earlier Innitial gra gra...Local Champion.

Chukzyfcb:

I would have gone to ghana to invest but my reseArch has shown they don't Allow non citizens to. Plus I'm at risk of exchange rate fluctuations.
IF only you knew the power of compound interest, you wouldn't be saying what you are saying.
I want to let you know that. If you invest 20million Annually in tbills of discount rate of 15% for 5yrs. Your 20million will turn to 45million naira.....same time if you buy a Plot of land for 20million today, in 5yrs U CANNOT sell that same piece of land for 45million. Its almst impossible. That's the Power of Compound Interest.
Don't mention business jeez you must be a Kid!, when Investment is discussed what they talk is
- T bills & Bonds
- stocks
- commercial paper & Banker acceptances
- real estate
- Valuables like art work or Gold
No Investment teaching manual or Book discusses business. In Investment talks are on ; how money works for you. In business, you work for your money.
You don't sound thAt smart to me. Raise your argument not your voice

Tritri:



Go school And learn u no go gree..Innitial Gra gra dey worry U. ,we talking about interest rate . ur talking about compound interest , with inflation ur only money is still your 20M.

For your Info.I owe a Bonds worth over 100M...Yes and am regreting that now. why..as at then the rate was 12.54% which seems to be the best..4month later rate is 15%...who's losing?

Finally u seems very smart..Why not go put ur 20M on T.B then start dreaming how to buy a range rover because you just did blood money .


Real Interest Rate'
The real interest rate is the growth rate of purchasing power derived from an investment. By adjusting the nominal interest rate to compensate for inflation, you are keeping the purchasing power of a given level of capital constant over time.

For example, if you are earning 4% interest per year on the savings in your bank account, and inflation is currently 3% per year, then the real interest rate you are receiving is 1% (4% - 3% = 1%). The real value of your savings will only increase by 1% per year, when purchasing power is taken into consideration.


Another one


Real Interest Rate = Nominal Rate – Inflation Rate

It’s important that the real interest rate be positive so that a lender or investor knows he’s beating inflation. If the real interest rate is less than zero, then the rate being charged on a loan or paid on a savings account is not beating inflation. The lender or saver would be losing money from a purchasing power perspective.

For instance, Fred has $1,000 and wants to buy a refrigerator that costs that exact amount, but he doesn’t need the refrigerator until next year. So Fred places the $1,000 with his bank in a one-year certificate of deposit paying 5% interest. This 5% is the nominal rate. If inflation is 6% then, using Fisher’s formula, the real rate of interest on the CD is negative 1%.

At the end of the CD’s term, Fred receives $1,000 plus $50 interest. But because of the 6% inflation the price of the refrigerator is now $1,060. Fred’s $1,050 is now not enough to buy the refrigerator. From a purchasing power perspective, Fred actually lost money over the one-year term

@Chukzyfcb As i said earlier Innitial gra gra...Local Champion.

Ryder306:



Have also heard the main reason why most banks are laying off staff is simply because of STA policy, before now, they get easy money (apart from d extra reap-off charges) from Government agencies n other to invest in Treasury bills n bond and at the year end they declare billions as profits......that should tell us something, Tbills is cool......but time value of money in regards to inflation is not cool in d long run.

Ryder306:



Have also heard the main reason why most banks are laying off staff is simply because of STA policy, before now, they get easy money (apart from d extra reap-off charges) from Government agencies n other to invest in Treasury bills n bond and at the year end they declare billions as profits......that should tell us something, Tbills is cool......but time value of money in regards to inflation is not cool in d long run.

Tritri:
Now do you know last month T.B was just 12% per year....3month ago 7% per year...now it 15%..Wat gave u the assurance it still gonna be 15% 2017?

Meanwhile ur afloat doesnt mean ur making money...U still don't get it with all d Teaching above it shows people like u na over sabi dey worry U.

Tritri:
Thank U. Almost everyone started as @Chukzyfcb but when u start to do T.B it another ball game.

@Chukzyfcb 7 month ago I did a casement window + bulgary for 6 NO 3 BEDRUM FLAT..it cost me 1.650M to site.

last Month i contacted the same Fabricator guy for similar 6 no 3 bedroom last price he gave me was 2.250..remember the same site same everything same design..

But i av T.B dat is paid me 9% or 10% per annum ,but within that 1yr the price of fabricating casement window has increased by 30-40% . I still havent done it and am regretting how i wish i NEVER bought T.B.

Now this is not only me.Ask people how price has gone up on everything at the market.almost 30-40 % high just within 6month.

Your T.B is only better against Savings acct.

This is Reality. Not reading nairaland and think it easy.

You shouting 17% Yield dat yeild not RATE but the last rate is 14.99 per annum. NOBODY ON THIS FORUM HAS GOTTIN 17% .



Stock is an Investment right? Go and load ur stock account and see exacltly .

Chukzyfcb:

Its okay bro. Let's be more civil as gentle men & not throw caution to the wind. You drew first blood by calling me out but now I want to call a truce. You have your own investment plan which works for you, others have thiers.
I just realised I hvnt praticsed what I just learnt in the book "How to influence people & make friends" by Dale carneige
He says "No one ever wins an argument, even if one does win the loser with loathe him & despise his victory"
Let's stick to what works for us. Let's not derail this thread further. Next time we cross path here, we should be discussing on this thread the possible movt of t.bills rates or dropping useful economic news & not attacking each other......Thanks & Goodnight

Chukzyfcb:

Its okay bro. Let's be more civil as gentle men & not throw caution to the wind. You drew first blood by calling me out but now I want to call a truce. You have your own investment plan which works for you, others have thiers.
I just realised I hvnt praticsed what I just learnt in the book "How to influence people & make friends" by Dale carneige
He says "No one ever wins an argument, even if one does win the loser with loathe him & despise his victory"
Let's stick to what works for us. Let's not derail this thread further. Next time we cross path here, we should be discussing on this thread the possible movt of t.bills rates or dropping useful economic news & not attacking each other......Thanks & Goodnight

Ryder306:


And that's civil and gentle man like, oga Tritri kindly sheath your sword also. I personally have learnt more things from this sound argument from both sides.

tinzymoha:
Can you kindly drop your number or email... Am a newbie to this and I really need to talk to someone familiar with TB

exclusiveoloori:



You can drop yours, will send you a mail

Tritri:
@zamirikpo Though U might be right..Go to kaduna and go price tomatoes maybe u will buy it same price last year.Or ask importers maybe price for TV is by location. when they r all imported into the country Or price for car is by location . There is no place that is cheaper .This thing happening in Nigeria is affecting all. Even did u notice the rate at which jobless people lament this days on nairaland or anywhere..it wasnt like this few years ago.

unite4real:


Cost of living in ibadan is not same as Abuja. There is that location difference factor.

exclusiveoloori:

You can drop yours, will send you a mail

unite4real:


Cost of living in ibadan is not same as Abuja. There is that location difference factor.

rationalmind:


Couldn't have said it better.

Was in PHC recently and priced a bunch of banana somewhere around garrison. The seller said it was 500, I priced it at 300. The woman said she won't even sell it for 400.

I replied that size of banana sells for 200 naira in Nsukka, 250 in Enugu and 300 naira in Onitsha.

The woman asked me how much it costs renting a flat in Nsukka, Enugu and Onitsha.

I knew where she was going and thought she had a point.

Chukzyfcb:

With regards to inflation, real estate is always seen as the best hedge. Because you can always increase your rental fee as things get more expensive but how many people have the cash to build & rent. T bills is also good & even better when you re-invest your interest (compound interest). Which is what I was pointing out. If one will only buy A plot of land & leave it undeveloped so he can use it to hedge against inflation, one who has been re investing his t bills yearly (compound) will catch up & overtake him overtime. Most people don't know the power of compound interest which is my main point

Tritri:
@Chukzyfcb Cheers

Alikote:
real estate has limit because the tenant ability to pay the increment is also limited hence arbitrary increases to bet inflation can lead to no tenant as all meaning zero income for many year put cost to securing the house ..u might be loosing money several house in Abuja city centre, lekki and apapa infact my neighbors six flats had been empty without tenant for 3 years in lagos despite slashing rent by 40 percent...nb the tenant wages just raise any how its limited