Beyond the problems we face in the current economy, there’s also opportunities. This week’s news includes some ways to improve your life:
I have always been determined to keep the overhead low. To me, money and debt directly relate to freedom.
Thoughts: Steph Davis does a great job of explaining her approach to keeping life simple. While her lifestyle or interests may not match yours, I still encourage you to think about what really matters to you and how you can balance your financial life.
Wealth—The Two Things That Matter
Here’s the simplest equation describing what we talk about everyday.
wealth = income – spending
Basically, there are two ways to increase your wealth:
- increase your income
- decrease your spending
Everyone at this point will probably be thinking that this is pointless, but how many of you really look at everything in this way?
Thoughts: A simple idea, but it’s sometimes hard to put into action. The same applies to the amount of time you have available to start new projects or spend time with your family. What do you really want?
What should not-so-busy real estate brokers do?
Why not start a local newspaper?
Here’s how I would do it. Assume you’ve got six people in your office. Each person is responsible to do two things each day:
- Interview a local business, a local student or a local political activist. You can do it by phone, it can be very short and it might take you ten minutes.
- Get 20 households to ‘subscribe’ by giving you their email address and asking for a free subscription. You can use direct contact or flyers or speeches to get your list.
Thoughts: Seth makes the great point that opportunities exist to become an expert in your local community. The underlying point to this idea is that we sometimes need to look beyond our regular boundaries for ways to succeed.
Unfairly Rewarding Greedy Bankers, and Why It Works
Sure, you can question how the money was used — many of us have — but you can’t quarrel with the fact that a financial meltdown has been avoided as a direct result of the government’s extraordinary interventions. Fannie Mae and Freddie Mac are providing much-needed support to a mortgage market that would be shuttered without them. The orderly wind-down of AIG‘s book of credit-default swaps prevented the collapse of an enormous financial house of cards. Citigroup was prevented from becoming the next Lehman Brothers, while the balance sheets of the other big banks have been fortified with additional capital in expectation of further significant write-offs.
…There is plenty to dislike about the Treasury’s bailout program, and no doubt there are lots of ways it can be improved, but it is simply unfair to call it a failure. Given the size of the credit bubble and the excessive leverage that banks were allowed to take on, there was no way to rescue the financial system without injecting new capital, shrinking loan portfolios and shielding bankers from the full consequences of their misjudgments. The standard by which it should be judged is not whether it is fair, which it is not, or whether it has magically prevented foreclosures and restored the normal flow of capital, which it could not, but whether it has sufficiently stabilized the financial system to allow for an orderly restructuring.
By that standard, it has been a qualified success.
Thoughts: Yeah, it’s been hard to watch that much money go back to the people that played a role in the current economy, but we also didn’t just “give” money away, it was invested.
