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Thread: The rules have changed -Here are the new ones

  1. #1
    SG Enthusiast blacklab's Avatar
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    The rules have changed -Here are the new ones

    I found this on a web site and thought maybe someone else may find it
    interesting. This is not funny.

    It may be a bit long, but it fits in with our problems today.

    THE NEW RULES OF MONEY
    by Robert Kiyosaki

    In 1971, the rules of money changed. In 1971, President Richard Nixon
    took the U.S. dollar off the gold standard. Today, 37 years later, the U.S.
    dollar has become toxic as it falls rapidly in value. Recently, The
    Economist called the dollar’s fall “the biggest default in history,
    ” exceeding those of any emerging market catastrophe. Today the rich
    get richer as the financial resources of America’s poor and middle
    class are wiped out. Unfortunately, the poor and middle class have no
    idea the rules of money have changed.

    One definition of the word intelligent is: if you agree with me, you are
    intelligent. If you disagree with me, you are a moron. In my opinion,
    Steve Forbes is a very intelligent man. It was an honor to be interviewed
    with him on the economy during the Forbes.com iConference.

    As a bonus, in conjunction with that iConference, I offer my views on
    the New Rules of Money. Before discussing the new rules, I think it’s
    important that I cover the old rules.

    THE OLD RULES:

    1. Go to school so you can get a safe, secure job. During my dad’s time,
    people did this. They went to school, got a job, and stayed with the
    company until they retired. Today, we all know that job security is a
    myth, especially as jobs are exported. Billions of people in the third world
    enter the global market competing for your job at a lower wage, and
    technology wipes out companies that do not stay competitive. Today,
    rather than having a job for life, those born after 1970 will probably have
    four to seven jobs in their lifetime.

    2. Work hard, climb the ladder, and earn more money. The problem with
    working hard as an employee is the tax laws are written against employees.
    The more money an employee makes, the higher the percentage in taxes
    the government takes. Most of us have heard Warren Buffett say that he
    thought it unfair that he pays a lower percentage in taxes than his secretary.

    3. Save money. Savers are losers, especially if you are saving U.S. dollars.
    Since 1971, the U.S. has been able to print money faster than the country
    earns it. This causes the value of savings to erode as prices increase.
    Adolf Hitler was elected Chancellor of Germany after the middle class
    had their savings wiped out due to hyperinflation. Stalin and Mao also
    rose to power when the previous leaders devalued their money.

    4. Get out of debt. Because the value of the U.S. dollar is falling rapidly,
    it is important to know the difference between good debt and bad debt.
    Unfortunately, even the U.S. banks are loaded with bad debt, a.k.a.
    subprime debt. If you want to become wealthy in a subprime world, it is
    important to know how to use good debt to offset the falling value of
    the U.S. dollar. If they are smart, debtors can be winners.

    5. Invest in a well-diversified portfolio of mutual funds through your
    company’s 401(k). First of all, Warren Buffett does not diversify. He says,
    “Diversification is for people who do not know what they are doing.”
    Second of all, John Bogle, founder of The Vanguard Group and one of
    the more brilliant minds in investing today, says that mutual fund
    companies have been ripping investors off. He states that investors in
    mutual funds put up 100% of the capital, absorb 100% of the risk, and
    receive only 20% of the rewards. The 80% in investor gains goes to the
    mutual fund company. On top of that, the Wall Street Journal called the
    last ten years “the lost decade” because there have been no real profits
    in stocks for the past ten years.

    THE NEW RULES:

    1. Keep your daytime job but start a part-time business. In other words,
    become an entrepreneur at home. Not only will you learn a lot, but the tax
    rules of the rich swing to your favor. If your business grows and can replace
    the income from your job, you may be ready to spread your wings and fly.
    As you may know, the richest people on earth are entrepreneurs who
    invest in real estate.

    2. Become an entrepreneur. The world’s most successful entrepreneurs did
    not go to school nor did they climb the corporate ladder. Many of the
    most famous entrepreneurs did not do well in school. Some of them are:
    Henry Ford, founder of Ford Motor Company. Ford could use the old
    man today. Thomas Edison, the founder of General Electric, was called
    “addled” by his teachers. Others include Bill Gates of Microsoft, Michael
    Dell of Dell Computers, Steve Jobs of Apple, Richard Branson of Virgin.
    Today, for a country to remain competitive, we need more entrepreneurs
    and fewer employees. With more entrepreneurs and fewer employees,
    wages could go back up. Unfortunately, most parents still say to their kids,
    “Go to school so you can get a job.” In other words, many people and our
    schools program kids to be employees – rather than entrepreneurs.

    3. Hedge your money. Instead of saving money, keep your money liquid in
    assets that increase in value as the dollar drops in value. Personally, I keep
    my liquidity in gold and silver ETFs. I buy every time the price of gold or
    silver goes down. Today, as I write, I believe gold is a good price under
    $1000 and silver a bargain at under $25. If I need cash in a hurry, I sell
    my gold or silver ETFs.

    4. Use debt as leverage. I am deeply in debt… good debt. I use debt to
    make me richer. I could pay off my home, but my effective interest is
    only 6%. As long as I can earn a 15% or higher return on my money, I’ll
    invest my money rather than pay off debt.If you are a professional investor,
    a 50% to an infinite return on your money is possible. If you would like to
    find out how I achieve an infinite return, read my latest book, Rich Dad’s
    Increase Your Financial IQ. One reason I do not diversify is because
    diversification is like going to the racetrack and betting on every horse.
    The only way you win by diversifying at the racetrack is if the dark
    horse wins. I would prefer to focus and pick winners. One myth in
    investing is that higher returns require higher risks. That is a huge myth.
    As Buffett says, “Risk comes from not knowing what you are doing.”

    5. Know the difference between salespeople and rich people. One of the
    reasons so many people are in trouble financially today is because they
    get their financial advice from sales people. Today, I cringe whenever I
    hear so-called investment gurus, who are really sales people,
    recommending the old rules of money. As Warren Buffett says, “Wall Street
    is the only place that people ride to in a Rolls Royce to get advice from
    those who take the subway.”

    Steve Forbes is a rich person who knows what he is talking about. His
    column in Forbes magazine, Fact and Comment, is a column I look
    forward to every month. If you want to grow rich – and stay rich – investing
    a few moments with Mr. Forbes is a priceless investment of your time.

    A FINAL CHILLING THOUGHT

    Here are some closing thoughts from Craig Karmin’s Biography of the Dollar:
    How the Mighty Buck Conquered the World and Why It's Under Siege: In 2005,
    U.S. interest payments on foreign debt topped the $100 billion mark for the
    first time – coming in at $114 billion dollars. That breaks down to $310
    million per day, according to Joseph Quinlan, Bank of America’s chief
    market strategist. This equates to more than $1 million per day for every
    man, woman, and child in America. Not only is America addicted to foreign
    oil, America is addicted to foreign capital. This is not healthy, wealthy,
    or wise. It will not make much difference who is elected as president or
    if we raise or lower taxes if America, as a subprime nation, does not
    stop living on borrowed money. At the risk of being redundant: This is
    not healthy, wealthy, or wise.

  2. #2
    R.I.P. 2013-11-22 blebs's Avatar
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    It sucks, but it's the truth.
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    I know im pretty much alone on this but this is extremely bad juju going down...

    http://www.foxnews.com/story/0,2933,425672,00.html

    (3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;
    Sec. 8. Review.

    Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
    But hey its all good, so long as I can come home to a warm meal, watch some fooseball, play some guitar hero then head out for a night on the town. As has been done in the past...engineered. PRS ( Problem-Reaction-Solution )



  4. #4
    Moderator David's Avatar
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    Inflation occurred even while the US was on the gold standard.

    Hell_Yes

    Luck is where preparation meets opportunity - Seneca

    "Anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that 'my ignorance is just as good as your knowledge.'" - Isaac Asimov

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  5. #5
    SG Enthusiast blacklab's Avatar
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    Quote Originally Posted by frostybear View Post
    I know im pretty much alone on this but this is extremely bad juju going down...

    http://www.foxnews.com/story/0,2933,425672,00.html


    Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

    Does this section:

    Sec. 8. Review.

    Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

    mean that the incoming government will not be allowed to review anything that is done under this bill? Are they just protecting themselves from the new administration?

    Isn't over half the financial system of the US owned by others outside the US, like China, Japan, or OPEC countries? Would these not be the ones who will benefit the most from this bailout?

    I think there should be some kind of bailout, but not to the ones who caused the problem in the first place. Maybe they should make the money available to the average citizen who has lost their homes or bank accounts.

    They would be able to buy back their homes at a reasonable price, not the inflated price they are today, and maybe get on with their lives. If banks or mortgage go broke, so be it, let the government reimburse people who had their savings in these institutes.

  6. #6
    Uninsured for your health
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    I say forgive the difference between fair market value and the artificially inflated market prices when the homes were purchased, then adjust as needed to get more managable payments
    Quote Originally Posted by Three Rivers Designs
    America! Love it or give it back!

  7. #7
    SG Enthusiast blacklab's Avatar
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    Quote Originally Posted by CiscoKid View Post
    I say forgive the difference between fair market value and the artificially inflated market prices when the homes were purchased, then adjust as needed to get more managable payments
    It doesn't matter much how it is done as long as the benefits go back to the American tax payer, who is footing the bill, and not to the get rich quick investors.

    I always though in an open market economy you were suppose to take the losses as well as the gains, not have the government bail you out.

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