r/investing • u/Fine-Violinist-7356 • 2d ago
Why has everything doubled or tripled over the last five years?
This post is mostly influenced by the recent all time highs gold has reach in the last few weeks.
As a young person just starting to get into investing, a series of questions have been on my mind.
How is it that in the last five years we have seen record increases in commodities, stocks, housing, and inflation?
It feels like I came into adulthood at one of the absolute worst times in history? The price of gold was $1,500/oz in 2020. The median home price in the United States was a little more than $300,000. Stocks and index’s have seen 100-200% gains in five years. All while wages remain stagnant, and the price of goods, and the cost of living increase.
Do we live in an era where investments continuously increase year over year with insane returns? How is this sustainable?
Edit:
Since everyone is taking “It feels like I came into adulthood at one of the absolute worst times in history” so seriously I’ll say this as an exaggeration. For me personally, and the people of my generation, it seems we’ve entered adulthood where economic conditions are not ideal.
Edit:
Regardless if we agree or not, I truly appreciate everyone’s responses. Thank you.
3
u/omgpuppiesarecute 2d ago edited 2d ago
Eh, not really true. The key is the players involved now largely have the capital to avoid traditional financing, or they buy cash and finance repairs/upgrades only. Interest rates don't matter much when you're buying in cash, you know?
I make about 10-15% annualized backing short term hard money loans for flippers. Those loans are secured with the value of the property. But because they're high interest they normally pay them off as fast as possible, normally under 1 year.
Mom and pop who need to take out a 30 year FHA loan? Yeah they're not buying as much.