This is a great article to quickly reveal how much we *don’t* know about $$ and what we need to do. Thanks to my friend Paul who forwarded this article to me.
I think these are most painful to me because I remember sitting there in high school having a classmate explain to me the importance of compound interest and making your money work for you. I completely agreed with him. After all, who doesn’t know the penny-a-day story?
This is a SUPER video to demonstrate how you have to be very careful when you buy a home and talk about it as an ‘investment’. It may be one of the *worst* investments you could make.
Please note that even though this video is excellent, it doesn’t talk about other very important factors like the fact that you have tied up $300,000 which cannot be invested elsewhere.
Buying a home, in certain cases, can be justified. However, it should not be made soley as a ‘great investment’. It is rarely great when you factor it all together. Especially when compared side by side with other investment options.
Catchy title, isn’t it?
Throws some monkey wrenches into the ol’ investment ideas, don’t it?
The interesting thing to me – and I’m already a big fan of bitcoin – is that it may be not far away. Check out this article where gold has fallen from grace. One of my favourite quotes was “People own gold because they don’t trust the central banks.”
That’s also why people own bitcoin. But with bitcoin you can easily buy your coffee and fine Indian dining (at least in Vancouver, BC) as explained by Yuliya Talmazan in this article from Global News. It’s much harder to whip your gold dust out while there is a line up behind you. Also, gold has an unknown amount remaining in the earth below which has the potential of lowering current values based on the supply and demand understanding. With bitcoin there is a finite amount and the day is coming when the miners won’t find any more.
And, really, at the end of the day it’s all about trust. Some people, in their ignorance, think their paper cash holds value on its own. Banks and governments long ago made sure they removed themselves from actually having to pay up if anyone wanted to collect by removing terms like ‘in silver payable’ from the paper bills. I strongly recommend watching this simple Youtube series to make sure you understand the history of money. In fact, if you are like I was – very ignorant amount money and our monetary systems, you may end up with a sick feeling in your gut. But ignorance is not bliss so watch it. The trust we have towards a currency, investment, or anything else for that matter, dictates the value. Value is truly in the eye of the beholder. If I told you that there was no actual asset backing the $100.00 bill in your hand and that the government could, with the push of a button dump a million more of them into the system, would you receive that bill happily as payment?
Bitcoin allows a very convenient way of ‘quantifying value’ and facilitating the exchange of goods and services. Since there is a finite amount of bitcoins, we can agree in principle that each unit will have value based on the supply and demand concept. Bitcoins don’t have any physical asset backing them, but people have proven with the example of cash that that will not prevent them from trusting it. So, the only thing preventing bitcoin from becoming dominant is consumer confidence and governments and other organizations who don’t want to lose control of their citizens.
So, I have two bitcoins reserved to buy your failing ounce of gold if you’d like.
One of my fondest ever memories is that of my 1977 Honday Civic. This thing was dope. Four speeds, a super long stick shift, felt like you were going 200K on the highway when you were actually going 85, and had those external flashers on the hood..with chrome. I put some boom in there too so the license plate rattled real good when I was listening to the Dream Warriors (look ’em up).
It had just one flaw – rust.
Around the wheel wells of every Honda Civic of that era water would somehow get in and rust away the metal right above the rear tires. Obviously rust spreads so I did my college best (I was literally in college) and cut as much of the rust as I could and used one of those rust kits and bondo to fix it. I repainted things and it looked good.
But the rust came back.
Just a few months later bubbles started to appear and the paint started to bulge. A few months later the red rust was breaking through the gold paint screaming ‘let my people go’. I attacked again but could never quite get down the wheel well far enough with my residential toolbox and the problem would always resurface.
Lately I’ve been noticing ‘rust’ in my life, the lives of others and in business.
I’ve noticed that a lot of people when they are caught in a sin (I define sin as anything that is rooted in selfishness while disregarding the commands of God that produce a joy-filled life) try to remove the sin by means of replacing them with good habits, by controlling their thoughts, or by patting themselves on the back when they don’t sin. The last one to me is funny if you use an extreme example:
“That’s great, Tommy! You only murdered three people this week in your anger. That’s down two from last week. Keep that up…I mean down.”
The problem is that sin is like the rust in my civic. That beast will eventually re-appear because it’s rooted in my sinful nature. Once people realize that the cause of many of their personal problems are rooted in sin, they can seek a solution. The cross is their solution. If you want to stay on your merry-go-round, no one will stop you. Feel free to keep trying your failing methodologies.
I’ve also seen rust in business.
I’ve been monitoring a fairly large retail chain these days. This chain had a heyday a few years back and the brand was really starting to kick some kahoahoa (I just made that word up). They were carving out a piece of a market where few had attempted to travel and creativity, life, excitement surrounded it.
But then Mr.Arrogance came by for sales call and the chain bought what he was selling in wholesale quantities. The rest is history. On the outside it still looks somewhat as it did but on the inside is dead man’s bones. The writing is on the wall. They only have one choice left: a full scale repentance and willingness to come clean with all people involved and even to the public. Nothing short of full confession of past foul-ups and immediate remedies will suffice.
This retail study will very much help my future investments, too. A company that is being eaten by the rust of arrogance will show symptoms:
- lack of creativity
- lack of excitement from the inside
- positions filled by people who shouldn’t be where they are
- words that don’t match actions
- no apologies – ever
- a heavy reliance on lawyers evidenced in one-sided contracts in their favour
- leaders who don’t get their hands dirty with the troops – ever
- and more
If you see these things, keep your good money as far away from this as possible. Search for companies or organizations that display the opposite and you will sleep better at night.
Rust. Cut it out.