Thoughts on Business, Politics, and Life from a Private Investor
There are three ways to make a lot of money in business. Typically, most businesses that are successful at making money do it in one by focusing on one of three models. They either: Sell many things at a low price Sell few things at a high price Sell many things at a high price By way of example, let's look at three high profile companies that follow different business models but are all successful. Wal-Mart sells many things at a low price. For every $100 you spend, Wal-Mart … [Read more...]
Financial success consists of putting together a collection of assets as well as improving your personal skills to sell your time for a much higher rate, so that you are able to generate constant gushers of cash, stay out of debt, give to charity, and fund new investments that result in your income and net worth growing much quicker than the rate of inflation with each passing year. Everybody sells something; you need to make sure you're selling the right thing for you at a good return. As … [Read more...]
As Gene Bedell wisely reminds us, nothing happens until something is sold. That is one of the greatest business truths you can ever learn. Get it engraved on the back of a watch, keep it in your pocket inscribed on a small sheet of paper, or repeat it to yourself silently, but learn this principle so that it is one of the deepest, closely held secrets held in your heart. Fortunes have been made in retail, manufacturing, technology, energy, commodities, finance, engineering, … [Read more...]
This article deals with people who want to be rich. Not just financially independent or reasonably well-off, but actually rich relative to the average American; the folks who want to be able to write a check for a Lexus or live in a nice house, in a neighborhood with great schools, without worrying about it, while watching their net worth climb year after year, decade after decade. The strategy involved for that type of success is slightly different in that it requires you to often build off … [Read more...]
This Halloween evening, I am sitting at one of the desks in my home, drinking a cup of Costco coffee, and penning About.com content for the Investing for Beginners site. I'm going to try and pre-write the next few months' worth of articles and set them to automatically publish themselves due to the upcoming time crunch we'll be facing at the Kennon & Green family of businesses, as well as in my personal life. As I wrote a blog over at Investing for Beginners, I typed out a line and did a … [Read more...]
If you want to know how to make money and begin making more money, I'll tell you the secret. There are only two levers you can pull. To understand this simple truth, let's start at the beginning. To grow richer, the formula looks like this: The cash flowing into your life (income) - The cash flowing out of your life (expenses) = Profit (if positive) or Loss (if negative) That simple, mathematical statement is elementary school subtraction. But it is powerful because if you think … [Read more...]
How do you deal with people that treat you differently once you have money? That is today's mail bag question. I promoted this question from a comment submitted from Frat Man after he wrote me on Facebook asking if I'd respond to it sooner rather than later, so it was pushed to the front of the line. I'm not sure how much this has been a concern for you since I get the impression that you keep a close circle of friends that doesn't vacillate much, but, has it been your experience that … [Read more...]
There had been some confusion about the methodology involved in calculating the top 1% of wealth in the United States. This article is updated with the "sticker" net worth for the top 1% as published by The Federal Reserve (assets - liabilities since that is what the typical American thinks of when they hear the term net worth) and clarifying that from what I consider the "true" net worth, which is a method called the estate multiplier technique, which is used by the IRS. The latter results … [Read more...]
The key to being fantastic at your chosen field is to reach what Charlie Munger called "testable fluency" in the basics so that you are able to perform the higher ideas like a meastro. This concept is simple: Mozart was able to compose so brilliantly because he could play almost anything by sight or ear. Likewise, Charles Dickens wouldn't have been able to write Oliver Twist had he not had a firm grasp of the English language. Higher levels of performance are only available to those who have … [Read more...]
The Internet is buzzing with a clip from Terrell Owens' reality show on VH1. In a recent installment of the program, T.O. begins to cry about the money troubles he faces after discovering that his finances aren't adding up, his credit score is in the 500's, he has mortgages due on real estate and he owes child support payments. You can watch it for yourself here: Get More: The T.O. Show 3, TV Shows, Full Episode Video, Reality TV Shows Two or three years ago, I discussed a Sports … [Read more...]
This blog is a way for me to pass along some of the stuff I learn on the journey and the past year has taught me a lot about furniture, furniture buying, and what constitutes quality furniture. Tying that into our usual discussion of economics and finance, I think it provides a lot of valuable [...]
I’ve been thinking a lot about free trade, labor unions, American manufacturing, and free markets for the past few weeks. You know that, on the whole, American manufacturing is still as strong as it was in 1960. We still produce roughly $20 out of every $100 of world goods. The difference? Technology and, to [...]
Though the home renovations have gotten the most headlines due to their nature (constant onslaught of choices and tasks that need to be completed), one of the most important items on the agenda of the six-month project has been to drastically reduce my digital footprint. By the end of the program, I will have one personal presence [...]
This makes me sick. This high school is ranked in top 5% of high schools in the United States. The worst part of the video for me was the part where the kid says, “I was never taught that knowledge”. It’s not somebody else’s job to teach you, it is your job to seek out [...]
This is a great way to start the day … one of the reasons I love writing this blog. Joshua, [In American Households Continue to Deleverage But That Only Tells Part of the Story, you wrote] “The numbers are just figures on a sheet trying to explain human behavior. Study the behavior, what is driving [...]
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Investing for Beginners
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