The Best Years of Your Life… Now!

You can work hard at your job and make a living or you can work hard on yourself and make a fortune…

-Eric Gutman

It’s common knowledge that getting a good education will land you a job. What’s uncommon knowledge is the hidden secret that self education is the doorway to real prosperity and abundance.

I remember being attracted – while still in my twenties – to a headline I read in a direct response ad placed in a magazine I was reading.  The headline was something like this:

“Most people don’t make any money because they’re  to busy spending all their time trying to earn a living”

The truth of that statement resonated with me and I bought the book “The Lazy Man’s Way To Riches”.  I was working in an automotive assembly plant at the time.

All these years later the truth of that statement has never diminished.  The greatest single reason people fail to live the life they love is because they severely limit how prosperity and wealth flow into their lives. They keep themselves blind to the possibilities.

So they sell the single most important asset they possess:  TIME

The most productive time of their lives is sold off – often at a huge discount – 40 or more hours a week in order to do little more than survive.  And they actually believe that living within the tightly controlled little world their fixed income provides is what life is supposed to be like.

NO IT’S NOT!

Life should be a series of adventures – one dovetailing into the next.  Each a new page or chapter in your book of life. At some point “money” should no longer be the biggest obstacle to “doing what you want – when you want”.

Instead of life being a book of adventure stories – to many people opt for only two or three chapters:

School -  Work – Retirement

Because the work chapter of their lives represents the largest single time period in their lives – many actually put off until retirement – those experiences which would have enriched and transformed their lives – if only they could have experienced them ten or twenty years earlier.

Instead of working on themselves – whatever “ongoing education” they participate in is usually work related – just enough to make sure they can hold onto their job until they can retire.

The greatest gift life has given you is the time you’re alloted to experience it.

If your “year” is measured by the highlights of vacations and time off from work – why not turn your “work” into a vacation.  Make the rest of your life the “highlight of your life”,

Why not begin now to live the best years of your life while you can still fully immerse yourself into the experience?

I mean, you can always get a job.

-Bob

Predictions for the coming new year have been running their course.  

If you read this blog you know I’ve been a long-time fan of “Coast to Coast AM”, the most popular of all the night time radio programs.

The January 1, 2009 broadcast was quite fascinating.

Gerald Celente,  led off a number of futurists, psychics and practitioners of the predictive arts.  For those of you who may not be aquainted with Gerald Celente, he’s been around a long time – has established himself as being very accurate at predicting coming trends.

His predictions were the most dire:

We’re going to see a substantial failures of retail merchants beginning in January. The main reason was the dismal holiday selling season – the worst in decades.

What a lot of people don’t realize is that most retail operations whose sales drop 10% or more can suddenly be faced with massive lay-offs, store closings and even bankruptcy.

Why?

Except for a handful of businesses – most businesses are leveraged, mortgaged and basically running on credit.  Which means that 10% loss in sales revenue can cause them to not have the financial where-with-all to continue to operate – That 10% is where they’re operating profit exists.

Look at it this way:

A business with a 1,000 stores with a revenue of  1 million dollars per store equals a billion dollars.  10% of a billion is 100 million.  This is simplistic but hopefully you get the idea -  Those stores have to maintain a certain level of revenue in order for the 10% profit margin to actually happen.

This where it can get complicated 

The profit margin rapidly deteriorates as the revenues go down – It’s not in direct proportion.  If the revenue drops to 900 million dollars the profit doesn’t stay at 10%

It may drop to 5 or 6%. 

A 10% drop in revenue can have a catastrophic effect on many businesses. Causing their profit margin to shrink very rapidly…

This is why banks are not lending to businesses – which appear to have large yearly sales revenue – It has to do with businesses’ revenue model. As far as the bank is concerned the bottom line profitability of the business – which is how the loans will be paid back -  is much lower than a 10% fall in yearly revenues would indicate.

You see, many American businesses – like many Americans  – are operating on a week to week basis – often struggling to keep afloat even in the best of times.

I’m sorry to say that we’re going to see a large number of businesses fail in the coming months because a 10 -15% fall in revenues means they won’t be able to keep their doors open.

Please support your local merchants. There’s a lot of good people who are suffering though sleepless nights right now.

-Bob Baran

Worse Than Expected…

Those three words have accompanied just about every dire economic report I’ve seen since last September.

So what’s going on?

The so-called experts don’t have a clue.  

We’re in uncharted territory. Their “models” of how things are supposed to be working don’t fit reality.

That should give you a boost of confidence!

The people who advise us on what to expect keep getting it wrong… Again and again.

So what does this mean?  

Well common sense tells you that if “worse than expected” has been the most used phrase during the last three months – when describing the latest economic surprise – you had better believe that experts are at least getting one thing consistently right:

It’s worse than expected – and it going to continue to be worse than expected until it runs it’s course.

Are you prepared for the “worse than expected” future that’s rapidly coming your way?

The Intentional Self-Reliance online Boot Camp is coming soon…

It’s going to help you be fully prepared – so your experience will be “better than expected”!

-Bob Baran

They say that a Sailor walked into a shop and saw what he thought was an onion on the counter.  So he sliced the “onion” – made a sandwich – and promptly ate it.

That “onion” was actually a tulip bulb

And that sandwich caused the Shopkeeper to go bankrupt!

You see, he had “invested” his entire life savings into that single tulip bulb.  Because tulip bulbs where the most valuable things on the planet at the time.  There had been an enormous run-up in value – so everyone started “investing” in them. That’s right – tulip bulbs!

Then the “bubble” burst and it caused a world-wide financial meltdown

Sounds far-fetched doesn’t it?  Like I made up the story…

Well, I didn’t.

It’s true and it really happened in the early 1600′s

Many fortunes were lost because people got carried away – thinking the price of tulip bulbs would just keep going up and up – until one day it all came crashing down.

Believe it or not, history is full of financial “bubbles” that always eventually burst.

It’s just the way of things…

How much you want to bet that even right now, yet another “bubble” is starting to expand – and people will soon start throwing their money into it…

Those who fail to study history are bound to repeat it.

-Bob Baran

I am responsible for closing down the stock market 40 years ago! 

Here’s exactly how I did it:

When I was senior in high school we had a visiting Assistant Professor of Economics (I think he was from Northern Illinois University) teach a class.  During that class he wanted to show us how the stock market worked. 

He gave each one of us a fixed amount of play money and told us the rules:  When you buy a stock the price of that stock goes up.  When you sell a stock the price of that stock goes down.

He set up about 15 “stocks” — which were names he wrote on the blackboard — all at the same share price.  As my fellow students bought and sold these stocks the prices went up and down accordingly.

I didn’t jump right in — instead I watched for a couple of minutes and realized something:

You could force the price of a stock upward with a minimum purchase of one share.

So I began to force the price up by buying one share at a time.  As I began to do that other students seeing the stock go up also began to buy — but they didn’t buy just one share they bought several shares at a time.  Finally, I used up all of my play money with my one share at a time gambit and then sold all of my stocks at once…

The teacher was watching what I was doing and called a halt to the trading — he shut down the market.

I ended up with the most play money in my account. 

The teacher was upset that I took advantage of the system for my own gain… and made a point of chastising me for it in front of the class.

I remember thinking to myself: 

Wasn’t the purpose of the exercise to show us how to make money in the stock market?  Was it fair that I was singled out for understanding how the system worked and using it to my advantage? 

After all, he didn’t set up “trading rules” which would have prevented the artificial ramping up of the stock value. A simple technique I just happened to recognize early on –  that it took a very small amount of money relative to the overall size of the market — to force the price of the stock up or down.   I cashed out when the stock I was manipulating was near the top of its value — the point was to make money, right? 

That was forty years ago.

I’m  amazed that the manipulation I was able to accomplish as a teenager in a classroom is still possible in the real world forty years later. 

The fact that the stock market can gyrate up and down almost 1,000 points or more –  in a single day –  means the “irrational emotional element”  — which is part of the herd instinct –  has no checks and balances in the current system — not to mention the flat-out manipulation of share price — that always assures some will win but most will lose. 

Let’s face it:

What’s irrational is taking a company that might be worth 5 billion dollars —  if it was put up for sale — based on its’ assets and revenue — but having its stock valued at 25 billion dollars!  A valuation which is based upon an assumption of “faith”  that people will continue to purchase that piece of paper — a share of stock — for a price that has no valid connection to the true value of the company… Other than some arbitrary emotional belief that somebody’s going to pay that amount for the stock.

Here’s the fatal flaw…

If three or four percent of the total stock issued for a company is sold in a single day it can have a catastrophic effect on the share price.  It doesn’t simply go down three or four percent in value — You see in a perfect world there should always be enough people willing to buy the shares on a given day to offset any sales of that share.  One share is sold and one share is purchased — maintaining a sort of balance.

But you have a system now where it’s possible — if you understand how — to make money when the market goes up or when it goes down.

The share price of a stock can drop or explode in a single day based upon the well publicized opinion of one individual or organization — Something that shouldn’t happen.

It’s also time to eliminate altogether or rigidly regulate anyone’s ability to “profit” when the market goes down.  Common sense tells you that there shouldn’t be an incentive to collapse the wealth of many to line the pockets of a few.

The potential for real stability will now only come when the “exuberance”  is sifted out of the market and share price more accurately reflects  the true value and performance of the corporation.  

Unfortunately, it means lot of people will have been better off going to Las Vegas and gambling their retirement nest egg away. Most Casino’s will “comp” you a free meal and drinks if you loose everything — something you won’t get from those who managed  your 401K — into oblivion.   

-Bob Baran