Wealth Basics Earn More

Your focus should not be on money nor material goods. Family, friends and your faith should be higher priorities for a good life. Consider the English Proverb, "Health is better than wealth."

Realize spoiling someone for the holidays is not worth debt you will be paying months later. You will need the money for future purposes. Fear of missing out (FOMO) is why so many people get themselves into credit troubles. You will be loved giving affordable gifts.  Live within your means.

How do we start to create wealth? First earn more. You will have more options to save. Scott Adams (Dilbert) says we become valuable by stacking talents. He became wealthy by drawing well enough, business knowledge, and being funny enough to be a syndicated cartoonist. 

Can you ask for a raise or promotion? Are you doing excellent work? Have you taken on more responsibility? These give you options.

You may have to change companies, industries or fields to earn more. My work in aerospace rewards me more than prior work in household products and real estate. However aerospace is known for boom & bust cycles, so this is a risk I accepted.

Research, read and talk with professionals what skills do they need? What technologies or new business approaches are growing now? Which skills and talents do you already possess? Do you have a degree? What can you learn and put to use quickly? Or do you need a degree in a different specialty that few people will put in the effort? Often you already have enough to earn more.

Avoid for profit colleges. Many people have too much debt for a degree that does not pay enough. Worse many did not complete a degree and still have the debt. Before you start a degree how do you minimize the cost and borrowing? In an era of rising interest rates, pay off and avoid debt.

Most wealthy people make create their money with a business, then invest to preserve their wealth. To start a business you need to have some money of your own to invest. Then you will have to borrow or get investors. If you are employed you can save for the future opportunities you see.

Start part time to see if your idea will work. Keep a day job and try a side hustle. Often it is not until we have tried a few different projects and processes do we find success. Once the income rolls in we have options including charity.

“If you make a lot of money, put it to use helping others while you are living. It is wealth's greatest satisfaction.” - Author Unknown

The American Holiday

Thanksgiving is a uniquely American Holiday.  We celebrate with family, friends, work off, stores closed and too much food. No rushed meal, long conversations, building relationships, memories, and see how the young have grown. Listening and assuming everyone has good intent.

To some this appears wasteful. How do you spend so much time & money on a meal? But gratitude is the core of America’s success. 

We all know failure. There is always bad news, terrible stock markets, natural disasters, politics, disease and death. Despite the happy story of Indians and Pilgrims, there was much warfare and Indians were decimated by European diseases. 

Celebrating another year with loved ones, letting the problems go, and being thankful build our success. Learn a lesson and keep trying. America celebrates both failure and success. And after both we try again.

Wishing you a very happy Thanksgiving

Things We Learned That Are Wrong

Sit Quietly and Keep Your Head Down

In school teachers talked and we were suppose to sit & listen. But that is not how children learn. They learn by doing. Students need activity to learn.

Get a Degree and Work Hard to Get Ahead

Education in was reading, memorizing and repeating data. As long as you could repeat the correct answer on a test you were done. Since my 20s have said “Secret to my success is after college was unlearning much of what I was taught.”

Wrong degree, and you will struggle with find work and raises. Hard work is a given. The people who get ahead take responsibility, action and stand out.

Theory X Management

Assumes people have little ambition, avoid work and are selfish. Most people if skilled enough, properly trained and rewarded can perform great work with little supervision. Nordstrom’s, Zappos, and many software & entrepreneurial companies prove how wrong this is.

More Data Solves Everything

“There is a sense that more data will give us greater insight [. . . b]ut the history of science tells us that is not always the case, that in fact very small observations gave us very fundamental insights about the nature of reality.” - Teppo Felin, Professor of Strategy at Oxford’s Said Business School

Small groups of dedicated people change the world. Not data.

To change something, start by saying “Yes I can.”

Your Political Views are a Minority

"Great thoughts come from the heart." - Marquis de Vaunargues

If you are in the Resistance, you are in a minority.

If you are a Trump diehard, you are in a minority.

IF you are a traditional pro-labor Democrat, you are in a minority.

If you are traditional pro-business Republican, you are in a minority.

If you are a progressive Bernie Sanders Democrat, you are in a minority.

If you are a 3^rd party or Independent, you are in a minority.

No matter your religion, you are in a minority.

My views are minority.

Americans are not uniform. We came from different states or countries. Our families are different, our foods are different, and our looks are different. Don’t think there is a typical American. No surprise our opinions are different.

The wide variety of thought is one of our strengths. Not being uniform, we can a lot of ways to solve problems or make improvements. America was built on experimenting and choosing what works. Why would anyone have a monopoly on good ideas?

My hope is in the number of close races across the country. Almost all candidates got less than 60%. Some winners will not get 50%. Gerrymandering voting districts are being voted out and stopped by judicial decisions. Close elections encourage people to vote for candidate who can get work done.

  

There are things most of us agree on, even if we don’t know how to solve them yet:

Health care and medicines cost too much.

Social Security and Medicare need cost reductions and more funding.

More jobs and a good economy pay for our services

The nation’s infrastructure needs maintenance, replacements and improvement.

The military needs updating and replacing used systems after years of war.

The government should not be going $1 Trillion further in debt per year in a healthy economy.

Remember everyone loves their children. We have more in common than differences. Be grateful for the differences.

Thank you for voting

"We must dare to think 'unthinkable' thoughts.  We must learn to explore all the options and possibilities that confront us in a complex and rapidly changing world.  We must learn to welcome and not to fear the voices of dissent.  We must dare to think about 'unthinkable things' because when things become unthinkable, thinking stops and action becomes mindless." - James William Fulbright

The Future is Shaped Like a Hockey Stick

The hockey stick analogy is a graph of how technology grows. Growth is slowly improving over years or decades, then explodes upward.

Look at so many bad predictions: 

"There is no reason anyone would want a computer in their home." - Ken Olsen, founder Digital Equipment Corporation. 

“This administration has no intention of participating in the construction of any more Cadillac-commuter systems that have very little chance of providing adequate benefits…. As for starting new freeways, I just do not see that happening.” - Donald E. Burns, Secretary of Business and Transportation, State of California, 1975

The reasons we underestimate the future is we tend to look with a bias towards recent events. Most predictions on the economy or stock prices are based on the last few weeks or quarters. Last week the stock market was up 2%. That followed weeks of falling stock prices, but prices were up the first 3 quarters this year. No one knows what the market will do on Monday morning, despite all the businesses focused on investing money.

Truthfully did anyone see the convergence of technologies that are smart phones other than Steve Jobs? Developing apps for smart phones was not part of the original iPhone, that came later and was key to the success of smart phones.

Computers were first developed in the mid 1930’s & 1940’s. Personal computers were introduced in 1971, but it wasn’t until 1981 IBM PC started the revolution.

Composites were also developed in the mid 1930’s & 1940’s for aerospace & military applications. Although we could say mud and straw buildings 6,000 years ago were the first composites. Composites are now widely spread since the 2000’s into commercial airplanes, automotive and consumer products.

These technologies made steady improvements over decades before their usage spiked upward. This is a common hockey stick pattern.

We can see patterns that may happen. Recessions happen regularly, so there will be one sooner or later. Stock prices to earnings ratio is among the three highest in history. Over the next decade the earnings ratio will likely return to mean. Expect lower returns on stock price growth in your investments. 

So the development of technology is going to give us some ideas about the future. Battery development, lighter materials and solar panels are driving the switch to electric cars. Electric cars with a range of 200 miles are eliminating the fear of running out of juice. The per mile cost of operating an electric car is one-third the cost of gasoline vehicles. Manufacturers are predicting mid 2020’s for the switch.

Longevity improvements have grown steadily or exceeded predictions for decades. Partly because no one anticipated how quickly the world economy would develop. Brooking reports for the first time 50% of the population are middle class or higher. 

Stem cells medicines and new treatments are producing improvements. Technology has made great strides in the past decades. The likelihood of a jump in healthy life expectancy could start in the next 5 to 20 years. 

What changes will we see with a lifespan increase of 10 to 50 healthy years? People can’t afford to retire for 60 years. What societal changes will happen? Longer lifespans have already reduced birth rates. What do you think? What other changes will happen?