Bobby D is Broke

Most everyone I know could make do on $7.5M per year. Robert De Niro, however, is going to struggle.

How do you star in Godfather II, Heat, Raging Bull, Taxi Driver, Goodfellas, Casino, The King of Comedy, The Untouchables, and Cape Fear only to end up broke? Ladies and gentlemen, Mr. Robert De Niro!!! Give him a hand everybody!!! [cue sad trombone. cue slow clap. cue a smattering of boos]

The State of Affairs

Mr. De Niro is barely keeping afloat these days. One problem is his ex-wife needs her monthly American Express Card limit raised from $50,000 to $100,000. This is per month hello sweetie, can you buy me a drink? Another problem is coronavirus hit his businesses hard (Nobu & The Greenwich Hotel). The third problem is at 76 he is unable to retire and has no cash. His remaining years look primed for a pile of crap movies made for the sole purpose of spending money… Get ready Fokkers!

His own lawyer states, “These people, in spite of his robust earnings, have always spent more than he has earned so this 76-year-old robust man couldn’t retire even if he wanted to because he can’t afford to keep up with his lifestyle expense.” She goes on to add, “the best case for Mr. De Niro, if everything starts to turn around … he is going to be lucky if he makes $7.5M this year.” Did you catch that??? Lucky… $7.5M… Lucky…

While a lot of words come to mind, pathetic seems to be front and center for me. You can say a lot of things about ol’ Travis Bickle here, but he is a victim of lifestyle creep in the worst possible way. A man scrambling to live on $7.5M/year has lost his precarious grip on reality. Truly pathetic – worse than “Dirty Grandpa”.

Creep

Lifestyle Creep manifests itself when your former luxuries become your current day necessities. As your standard of living improves alongside increasing discretionary income, your spending on nonessential items becomes a right instead of a choice. “You deserve it” drives your spending over budgeting, planning, or investing. No bueno. It works until it doesn’t. Absent careful and meticulous planning, the results are usually not very pretty.

The worst thing to consider is De Niro probably has (or has had) professional managers, accountants, money mangers, business managers, and investment professionals in his stable. He also probably employees personal chefs, personal assistants and their assistants, drivers, security, fitness trainers, and his own concierge service. It sounds like he burned through money at a rapid pace.

Avoiding the Creep

Plan, budget, and then budget and plan. Stick to the plan, and stick to the budget. Live below your means, and save a good portion of your income. This is my plan of Method Money Management I have written about before. It works. I promise.

A Brief Look and Gold & Silver

We are currently witnessing history in the market. For the first time ever we are seeing an asset price bubble at the same time we are experiencing an economic recession. We’re going through this with un-employment numbers at their highest in the post-WW2 era.

For this reason, investors are starting to retreat to safe haven. With the bond market in capitulation, this has meant Gold & Silver. The $GLD gold ETF is up 25.05% YTD and the $SLV ETF is up 27.16% YTD. The traditional safe haven, the Aggregate Bond Market $BND ETF is up only 6.15% YTD.

Back in February 2017 I told you about $CEF, the Sprott Physical Gold & Silver Trust. This remains my favorite gold/silver buy. With one purchase you get 70% physical gold (400oz. silver bars) and 30% silver (1,000oz bars). It is outpacing both gold and silver individually with a YTD return of 29.13%

$SPY (blue) versus $CEF (green), $GLD (orange), $SLV (purple)

Eyes Forward

I am starting to consider the outcomes of an asset bubble colliding with economic recession, record unemployment, global pandemic, widespread civil unrest, and a presidential election to boot. I would suggest you do the same. As for how to prepare – stay tuned and subscribe below…

Cheers, and thanks for reading.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: