Let us talk about the hardest form of making money investing: 

Well we are almost half way through this year and of course the question is “Where do we go from here?” If you have been at this game for a while, like some of us have, you would have seen set backs before. However if you are new to market trading and have just discovered it, it probably has you thinking, I don’t want a bar of this, and who would blame your.

Alas a lot of us are in this for the long haul and a lot of us just now are looking at loses in a magnitude never seen before. I know some of you like me have seen lots of down turns, but we just haven’t seen this before and we haven’t seen anything happen as quickly as this came upon us. We all know that gloom follows boom, but until now we have been led into it in a gentle and kindly manner, not like this kicking and screaming and asking where our money went. Well let me tell you, I intend getting mine back and then some.

I turned adversity into profit back in the eighties, yes I was investing then, and I will be in this game for as long as I live, the highs are worth the lows in my opinion. After every downturn of the stock market, things happen that you can turn into profit; you just have to know your oats and learn from your mistakes.

Things have changed in our investment world. The high flyers have had their wings cut; those who took risks with someone else’s money have been hauled in. Those of us who let them have some of our money to play with, are shaking their heads and telling themselves that they could have lost it just as easily themselves and had more fun in doing it.

I will say to you all, learn how to look after your own money. How many times have you seen people in tears on the nightly news, telling about how they trusted someone because they thought they were honest and now they don’t know where that person is or which country they are in and “they trusted him with $500,000 it was all the money they had in the world,” you hear them say.

Come on, get real and learn. No one is going to turn your money into a fortune overnight, and if they are so cleaver, ask them what they want your money for.

Yes you are going to have to do some work to get back to where you were before the bust, but it should be work you enjoy. If you aren’t getting a buzz out of this, take stock and ask yourself if you might not be better off doing something else. Personally I have a few dollars to get back, but I must confess they were dollars that I had already won even so I was quite attached to them.

So lets have a look at what is going on in the world just now.

1.

     We have a new President in the White House in the USofA. That’s good for a few good points.

2.

     The price of oil has plunged; that should be good for a few more.

3.

     We are starting again in a depressed market, and that is definitely good.

On the other hand we have,

·

       Lots of people are losing their homes and their jobs and that is tragic. No matter what the reason I could not imagine what it would be like to have to give up your home, or to be told that you no longer have a job. I have never had either experience so I can’t say I know how you feel and if this has happened to any of my readers, I feel so deeply for you.

·

       Some of the world’s biggest corporations are in deep trouble. That too is not good. My feelings on why this has happened could fill a hardback novel. I expounded my ideas on this about thirty years ago when I saw the first Datsun car imported into my country and selling for hundreds of dollars cheaper than the locally produced cars. Yes I know what the governments say about free trade, I wonder do they still feel the same way.

·

       Growth rate in the world economy has slowed, is this good I hear you ask? Well for a few years now certain countries have been sucking up huge amounts of the world’s resources and turning them into plastic trinkets and plasma screen TV’s. Has it made your life any better? Yes I know those power tools I have to buy are cheap but boy, I wish I had a choice, and I know all my clothes are old because they were all made in this country.

·

       Yes I know a lot of workers in the mining industries and the mining companies made a lot of money, yes me too trading in their stock. This allowed lots of people investing in housing and not just buying a home, to pay way above value of what the houses were really worth, forcing the prices to untold highs. I don’t think that was too good.

I could go on a lot longer but you probably have more important things to do. Now is the time to take action, now is the time to learn, and be ready to take the opportunities as they present themselves. The world stock markets will rise again, they always do.

I’ll leave you with this thought.

A pertinent historic quote is from John Maynard Keynes in 1920: “By a continuous process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method, they not only confiscate, but they confiscate arbitrarily; and while the process impoverishes many, it actually enriches some … The process engages all of the hidden forces of economic law on the side of destruction, and does it in a manner that not one man in a million can diagnose.”

MR (ed)

http://www.expandingwealth.com

Posted 12 February 2009 

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