Category Archives: concepts

Will the price of gold continue to rise?

Business, concepts, Investment, Money, , , , ,

Recently I have been posting answers to questions on yahoo.  It is fun.  Here is one I did today.

Question:

Will the price of gold continue to rise?

My Answer:

Well no one has a crystal ball.  It could go up or go down. But one can read the signs and make projections.

I assume when you say price, you mean dollars per ounce.  Much of the rise in the price of gold was really a reduction in the value of the dollar, some was the demand for gold.  It is all really supply and demand.  The price per dollar of gold will depend a lot on how much money is created in the world, how much credit is out there.  In 2007 the trend was to create a ton of money, and with the low interest rates now going into effect it will do the same thing.

So it all boils down to a bet, do you bet it will go up or down, I say it is a 65% chance it will go up in the next year and a 35% chance it will go down.  I do think you may have a higher percent return on silver than on gold, simply because silver is very useful in many things and is in growing demand, and the supply is not growing as fast.

Also no matter what metal you choose to buy, I would highly suggest you buy the actual metal, not a paper title saying you have ownership.  The best way to do this is simply walk into to any coin shop and buy it.

Gold is a great hedge to inflation, but I do think that many other things would be a better investment right now.

The value of financial education is huge.

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It is said you never really know what you don’t know. It is not until you learn something that you really understand the value of the thing you just learned. Some things are very valuable and other have little value. For example if you get a little education on real estate investing and how it REALLY works, (Not always what you see on the TV) it will rock your world.

On the other hand I went to a 4 year university and at the end of it all I felt that I could have learned much more on my own. I am still glad I went for the social side of it all. Too many people spend their whole life in the rat race, it is like a giant treadmill, you only earn enough to get current on your bills, and if you ever make more you tend to spend more.

There are many bloggers, most much more popular than I am, that tell the masses how to save their meager earnings, and how to find deals so that they can spend less. But you really can only save so much. Even if you could save 50% of your earnings you still would take years to really get ahead. What they miss usually is that it is MUCH easier to increase your earnings than reduce spending. It takes a different kind of education, a type that most people do now learn. One nugget of info can change your life. It is much easier to live below your means if you increase you means. You do need to control costs, but spend more time increasing income than controlling costs and you will be ahead in the long run.

There is another blog, by a successful guy who gets this, I highly suggest you read his blog. It is called 7Million7Years. He recently wrote a blog about home equity, and that you should not put all your net worth into it. Read it here

Are you ready to learn how to take your investing, and your thoughts to the next level, well the next step is get educated. Read books by Robert Kiyosaki, Donald Trump, Douglas Andrew and Ric Edelman. I have found them to have the best books on real financial advise. Most of the others really give the WRONG advise. I don’t know what they are thinking sometimes.

If you are interested in real estate investing (Which you should be) my company, Capital Active, sponsors events where we teach people, for FREE, how to get started and how to be successful right from the start. If you are interested in an upcoming event sign up here.

Thanks and have a great day, leave a comment please.

Choose Your 5 Faves Wisely, it will change your life.

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I have heard for years, before T|Mobile even existed, that the 5 (Adult) people that you spend the most time with will shape your life.  You will become like them in most every way.  The amount of money that you earn will be near the average of these people, your ethics will be similar to the ones they have, your hobbies will start to match them and in many ways you will reflect these people in your life.

For me I have two people who I spend a lot of time with at this time, my wife and my business partner.  But beyond that the people are always changing.  And this is the key, when I decide who to spend time with I am REALLY deciding who I want to be.  Do I want to be like my friend who is a great speaker, a multi-millionaire, great to his family and a great all around guy….well of course I do.  Do I really want to be like the people who don’t care, who just do the minimum in life, and have bad things in their life……well no I don’t.   My problem in my life, I hate to admit, is that many times I spend time with the second type of person.  I don’t really know why I do this, it is not in line with my goals but yet I find myself in this position.  Maybe it is because when I am with them I am the one who knows everything, I am the one who is in charge.  When I am with successful people it often points out my flaws and challenges me, logically this is what I want but often emotionally it is hard to handle after a while.  For a few years there I strayed off course.  I seem to have done this a few times in my life.  I imagine where I would be if I did better, if I was bold enough to do everything that I imagine.

So how does this relate to business, well your personal development is the KEY to your success in life and therefore your success in business.  You choose who are your 5 Faves, and that choice determines you whole life.  Choose wisely.

They are watching you, and keeping track of your wrongs (Unless you pay!)

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What if an organization existed that kept a database on everyone. They would listen to whatever the general public says about other people, and they would record that information and save it in a database. Anyone can go and complain about anyone they like. The more people you meet the higher the chance you will have that someone will have a problem with you. Now what if they made that database available online, for anyone to search and look things up. Then they went a step farther and they would advertise on TV and on the radio the existence of their database, telling you that before you have a relationship with this other person you could look up what other people had to say about this person. They would also encourage you to report any complaints you have about others. You would be considered guilty of whatever action people have complained against you until you prove that you are innocent.

Of course they would not keep this database, and advertise for free, they would need to make money some how, so what if they let people become members of their organization, and a member would be allowed to ‘dispute’ anything in their own personal record and have it removed very easily. To be far they would have to establish a process for non members to dispute things, but of course these disputes would be given much lower priority. Also a member would be given a badge that they could show off the fact they were a paying member. If members paid a bit of extra money they even would be allowed to post this fact on their web page. The organization would advertise that you can only trust people that are members, even though membership is fairly meaningless, it only means you paid them off.

If such a thing existed would you be upset? Would you be outraged? Would you demand that the government do something about it? Would you see it as blackmail?

Well guess what, this organization DOES exist. It is called the Better Business Bureau and that have been doing exactly what I have described for almost 100 years. They pretend that they are there to protect people, that they keep detailed records on businesses but I have seen it first hand, that as soon as you pay them to become a member everything bad goes away with ease, and it is very hard to deal with them if you are not a member.

Also you have no idea what percent of people are unhappy with the company. Who is worse the small business with 10 customers and 5 of them complain or the large company with 10,000 customers where 50 complain? Well according to the BBB the larger one is worse. There are always crazy people who you can never resolve a problem with, we all know them, and companies are punished for having them as customers, even if only .1% of their customers have a bad experience they could have a horrible rating. The company across the way with 10% of their customer having problems pays the BBB off and gets away free. This is a horrable system.

So what can you do about this unfair, blackmail organization? As a customer do not trust them, do not use the BBB to handle your dispute, do not look up your vendors in their database and when you see someone who is saying they are a member, feel sorry for the delusion they live in. If you own a business or have influence in one please don’t become a member, do not give them money, and respond to complaints filed with them.

I am not mad at them, I have no problem with them personally, I just feel that such an organization should not be allowed to exist in our modern society. Maybe if they made some changes, and provided more information, including positive information it would be more useful, and also made it easier to dispute claims against you. But as of now there are many much better and more accurate information sources for those looking to find out about those they plan to do business with. Here are some examples of companies that many people consider to be horrible, but they have perfect ratings with the BBB because they pay, even though there are a huge number of complaints about them. Just read what some people had to say about these companies.
Frys Electronics: Vegas Midway auto team: Phoenix Best Buy (over 12000 complaints) ( I just love how most of the complains on these members are “Administratively closed” something only members can have done.)

Is having a budget really a good idea for you?

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I hear people all over the place talking about having a budget.   They say you have to plan how you will spend your money.  For wage earners who trade their time for money, and usually trade the same amount of time and thus earn the same money at a predictable level a budget sounds like a good idea.  BUT not everyone is like this, there are us entrepreneurs out there, people who trade effort or ideas for money.  If you are one of the 5% that really wants to be successful in life you need to follow a totally different set of rules, and listening to the people who are in the other mindset will only distract you and give you wrong ideas.

For this 5% a budget is silly. I don’t know how much gas I will use, or how much I may spend on eating out.  The thing is I hope I spend A LOT on gas because almost all of my driving is for business, and the more I drive then that must mean the more I made in sales that month.  The same goes for restaurants, I would love to take a lot of customers out to eat, each time I do I make about $1,000 on average.

So what are we to do in this position?  First FORGET the budgeting idea.  For the things you must buy, find the best deals and be frugal.  When deciding if you are going to do something don’t only look at the cost of the activity, like budget people do, look at the income opportunity.  In January we were planning on going to Vegas for 4 days for the CES convention, a few people questioned us if this was in the budget or not, of course it was not because we don’t have a budget, but going to this event made many changes in our business that have more than paid for the trip.

I read a blog today about a guy who suggests you cut your cable to basic to save the $200 or so per year it costs extra, and also to watch much less TV.  I agree with not watching mindless TV, but I can point to many times where I have seen something on TV that inspired me to do something different, and this action resulted in a large profit for our company.

So many people ignore the dollars, hanging there to be picked because they are so busy picking up the pennies on the floor.   The thing is that MANY people will spend 10 hours in a week, comparison shopping, looking for deals, going to 5 grocery stores to get the best deals but almost all of them spend NO TIME at all trying to find new ways to earn money.  One idea that can earn you money can be worth ALL the ideas you have to save money, yet 90% of the blogs out there on money are about how to save money.   This just shows you the wrong financial thinking that most people have.

Emerald Computers, a short history from a business POV

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I started a computer company in 1998, and thought I knew it all but I quickly learned so much more. I moved that store a few doors down and this time designed in the way I wanted all future stores to be like. I created systems for doing everything. Then I set out on opening more stores. By then it was 2004 and the market for computers was crashing, the wars by the big companies erased all the profits in the industry. By 2005 we were back to one store. By the end of 2007 we decided that the retail storefront was not the way to go. We moved to a much lower rent area, and just serve corporate and online customers, the ones with the best profits. The wars are over and the profits are back in the computer industry, and with our reduced cost, decade of experience we are ready to explode. All we need now is a capital infusion to get us to the next level. Even if we only get .5% of the US market that is still huge.

Now we are looking for investors.  People who can see the vision and are willing to go there with us.  They will, of course, share in our success.

Freedom in the modern age.

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Well I have never talked on here about entertainment before but here is one that is good.  If you do or do not know there was a show called Jericho.  Last night was the last episode of it.  It was a really great, well written show.  It lost some people because for a while it went a bit slow, and most shows with arc don’t last once you miss a episode or too and the network changed it’s time slot at a very critical time in the development of the show.  (Arc is when a show is a story from one episode to the next so you have to watch them in order to understand fully what is going on.)  Basically they did not give it the chance they should have and it failed.   It was canceled after the first season, but the largest fan outcry in TV history made them bring it back.  They did so with little advertising and fanfare, and had a second season of only 7 episodes that mostly concluded the entire story.

The reason this show was special is because it touched on subject that are almost never talked about on TV in this way.  Maybe it made some of the corporate people unhappy with the direction it was going.

WHAT FOLLOWS IS A SPOILER.

Basically the story goes like this.  There are bombs that go off and destroy the 23 largest cities in the US except New York.  Communication and power stop.  Food runs out and people in rural Kansas start fighting to survive.  Well equipped mercenaries raid towns and take all the resources and kill many people.  At some point a goverment is put in place.  The old US has the east, TX is independent and the west forms a new nation.  The nation formed in the west is totally controled and financed by a huge mega corporation, the same one that ran the war in Iraq for the US and hired all the mercanires that the US used worldwide before the attack.  The corporation quickly takes part of everything.  They take away freedom, they surround each town with checkpoints so that only products that say can get in or out.  They rush a new constitution that takes away all the power of the people and gives it to the corporation.  Everything is unfair but they have all the resources and power.  Soon the people start to revolt, and by the end of the show all the viewers are calling for revolution.  The last episode is the start of this revolution with Texas shooting down airplanes from this new western nation.

Much of the show focused on the trap of giving corporations too much control of the government, which in turn takes rights away from the people.  This is something that is happening right now in the United States.  There are so many ways that our freedom has been taken.  The government is fairly corrupt.  They spend way too much, and take way too much.  They also spend so much more than they take in.   Who said the federal goverment should secure travel?  Who said they should put so much control on what we eat?  Who said that the government should run the school system in such a poor way?  We tax people so unevenly but yet the government mails out billions of dollars in checks.  The show Jericho showed how this line of thinking will only result in loss of freedom, and at some point the people will revolt.

If you told anyone 20 years ago the things that are going on in this nation right now they would have said you are crazy, that could never happen.  That is way overstepping the role of government.  I guess they are doing it just slow enough that most people don’t notice.   The education system has failed the public by creating the dumbest population this nation has ever had.

People in our nation now expect to carry ID everywhere, go through government checkpoints to travel.  It took me over a year to have our federal government allow my wife to enter the nation, they have no right to say who I can and can’t marry.  People expect to give a personal ID number every time they talk business on the phone.  People expect their information, privacy, and rights to be disrespected.   Most of them are so miseducated that they simply believe what they are told by the media, they have no idea how to think for themselves.

If it goes much farther down this path I will really start to fear for the future success of my country, the United States of America.  Most of the nation and the decisions are totally out of the control of the people, and most of the people disagree with many of the decisions.  Most people think we are not to be the world police, they think we spend way too much and should not carry debt.  Everyone I know thinks the tax system is crazy and needs to be replaced, but yet every year it gets more complex.  When will the craziness end.   Maybe only with revolution.

The key to commercial success for Linux

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You use a computer, and read blogs so you probably know a bit about computer and you probably know about Linux. Linux is great, robust and free OS. It runs almost all web servers and websites. Including google, wordpress and billions of others. Linux is very secure, robust, fast and hack proof. It makes great servers because servers are ran by experts. Without Linux the web would not exist as we know it.

Well for over a decade now they have been trying to make it popular for your desktop computer that you use every day as well. One of the best parts about Linux is that anyone with knowledge is free to change and customize it exactly how they see fit, and they have. Almost everything in Linux has at least 3 different programs that do the same thing, but they do it in different ways. People then pick and choose the different parts of Linux and combine them into a complete Operating System. They call this a distribution or distro. There are now 100’s of up to date distros, all with different ways of doing things and different followings. This has helped Linux in the past but in the world of mass merchandising it also has hurt Linux.

The problem is that when a company writes software to work on Linux they must assume things about how the computer is set up. Because there are 100’s of different ways to do this, and only a few million Linux users, they simply don’t bother. Companies that make drivers and hardware also don’t bother. The Linux people thus have to do all of it themselves. And, if they do it for one distro of Linux it probably will not work on many others. So the game makers, and the people who make the huge programs we need to function usually don’t bother making a Linux version. There is no Photoshop, QuickBooks, MSN or Yahoo chat with webcam, or robust video editing software in Linux because these are very complex and would usually be distro specific, and the userbase does not justify the cost.

The strength of Microsoft Windows was the fact that it was closed and controlled. People could not change the OS, all the rules from computer to computer were exactly the same. Because of this people could code for just ONE OS, that they knew would be supported and work for at least a decade. This is exactly what they did, 1000’s of companies started writing. Hardware makers could design one driver to work with the OS and everything was easy, because it was a standard platform, that was predictable. Windows was not the coolest, and it sure was not the most secure or robust, and they charged a huge price for it, but all of this was worth it because it was STANDARD. Nothing is more important than something being standard when it comes to business, and all the geeks need to learn this. McDonalds does not made the best burgers, but I have ate them in 5 different nations and they are all the same. When it is the same it is predictable, and you need that to get investors and make money flow. This is the main reason the Linux world still has less than 1% of desktop computers.

So now what? Well in a dream world someone with great power and clout would take all the best parts of Linux, get a ton of people behind him and release the ultimate distro of Linux. He would promise to not change it for at least 6 months and also promise that anything written for it will work for years on the newer versions. By creating a standard and unifying the Linux world programmers would start making software work on Linux and soon it would gain marketshare. It will be better and be free than windows, and soon takeover the world from the grasp of Microsoft.

Someone else, a tech billionaire named Mark Shuttleworth thought EXACTLY the same way, and he used his power and clout to do it. He calls it Ubuntu. He only release every 6 months, and he has static versions that are supported for two years or more. He then went much farther, he made a community around it. They have great free tech support with forums and chat. As well has many other great features and designs.  My good friend Matthew Helmke is one of the leading Ubuntu experts and forum leaders and inspired me to try it out.

This OS has the chance to become huge. For over a year now Linux has been the top distro, and it growing faster than the rest of the Linux world put together. The standard it presents has already encouraged many companies to start writing software for Linux. Many large games are not tested on Ubuntu. If you use Linux, switch to Ubuntu, for the sake of the Linux world. Raising a unified standard is the only hope that Linux has at commercial success.

I hope this explanation of a very tech thing from a business perspective educated both the techs and the business people who usually don’t understand each other.

I will offer much more of this sort of knowledge in the future so be sure to subscribe to this blog!.

Jason Dragon.

The world is changing forever. It is getting flat, feel the pressure yet?

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The world is changing forever.  Well this has been a true statement for as long as history has been recorded.  The pace of this change is much faster now than it has ever been.  The problem is that many people are stuck in their way of thinking.  The learn things one way and most people, at some point stop keeping up with the changes and start to fall behind, way behind.

So how is the world changing right now?  Well we are in the middle of a few major changes.  The key to most of these changes it the spread of technology.  Because the United States was first in most everything we had to go slow, create standards and design from scratch.   Other nations have had the gift of just being able to copy our progress.  Think about advances in computers, medicine or cars.  The high tech developed nations have designed the improvements but everyone; even those in the poorest nations get the benefit.

Now having the same, standardized protocols methods for doing things all over the world, along with an instant, worldwide communication system things REALLY have changed.  Now people from anywhere can communicate instantly, they can chat, they can talk.  And now it is everywhere and so cheap that people with almost nothing can still go to a public computer lab and join the global work force.  With just a small investment an office can be opened anywhere to do most things.  This allows the work to be done in the location where the labor is the cheapest.  This premise is called the Flattening of the World.

When I was in Asia for much of last year I still had an Arizona phone number, I was able to control computers in Arizona just as if I was sitting at the keyboard.  I was able to send email, create web pages, move money from account to account, write checks online, order parts and have them shipped to our production area, as well as sell products to customers.  I could do 90% of what was required to manage a company.  For the other 10% I delegated it, and was available on the phone to help the person out.  This is happening all over the world.

No longer do the super smart people from all over the world want to move to the US or western Europe so that they could be apart of the global high tech work force, they now can do it from home, in their native country.

This change is HUGE, and it will never be reversed.  It will FOREVER deeply impact the way the world works.  Most jobs are now at risk and the jobs will be given to the person who will do the best job for the best price.  If you keep your job the price pressure of the rest of the world will make the wages you are paid go down.  This is great for the people who see it coming and create a system to take advantage of this new shift.  It will be the worst thing for those that don’t keep up, and those that expect things not to change.

People who are in lesser developed nations will also gain, they will be the target of huge amounts of education, and capital.

There will be a new definition of the middle class, the definition will be MUCH lower than what is currently considered the middle class now, maybe a family income of $15,000 per year.  world is flatBasically what we see as the middle class in the United States will be much smaller than it currently is.  And millions of people all over the developing world will be moved out of poverty and into their definition of a middle class.

If you want to learn much more about this there is a really smart guy named Thomas L Friedman, he invented the term and latterly wrote the book on this subject.  This book is one of the most important books of our current time, and those that understand it will be much more successful in life.

No matter what happens it is huge and will affect you.  So it if your choice get educated about it and take advantage of the change, or just wait and be sideswiped by it.

The dollar is so weak, and we are paying for it, GREAT!

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For years now we have been borrowers.  We spend way more than we make.  I am not just talking about the government but also the people.  You can see this in our balance of trade.  Because of this the dollar is falling like a rock.  People don’t want to lend money because it will probably devalue more than the interest gained.

Imagine that I would lend you $1 million dollars and you need to pay me $1.1 million a year from now, well if the dollar goes down 20% I am only getting paid back (In present dollars) $880,000.  So why on earth would I lend you the money.  This is the problem that we are having now.  Up until recently most of the money being lent to Americans was coming for foreign investment.  These foreign investors as a whole are hesitant to lend us money.

So what is the solution that the government thought up.  Well they offered to lend money, billions of it, to the banks so that they can lend it back out.  But where did the fed get this money to do this, they simply typed it into a computer and created it.  This makes more dollars in existence, and will further sink the dollar down.  This cycle will keep repeating and soon our dollar will be worth very little.

What will this do for us.  Well it will make the dollar cost of most things go up.  Even real estate will soon start to go up with all of this.  Gold is now over 1000, silver is over $20 and oil is at record highs over $110.  This has been coming for YEARS now, I have been talking about it for about 3 years.  This just that start, until we start exporting much more than we import, and we stop spending so much this will keep happening.

So what is the best position to be in?  Well you want to have as little dollars as you can, you even would want to be short on dollars.  This means to borrow them.  I have debt for my house, and for other things, and when I saw this coming I took out as much as I could and invested it in things overseas, and in physical things such as real estate, and I think that in a few months, the value of these assets will be much larger than the debt.  The banks have figured this out and stopped lending to most people.

So what will happen to people who were not ready?  Well it will not be good.  If you have a job, and save money and have no debt you are in the worst position. The money you have saved will be worth less than it should be.  The

What can you do not?  Well as I said before the people who see it first are the ones that are in the best shape, they can prepare for the change.  Now it is too late, there is very little that can be done.  Right now I think it would be good to move money overseas, invest in companies with a large amount of foreign exposure.  Pay off only the minimum on debt.  Don’t keep cash, go turn it into silver.  But MOST important, if you can afford it GO BUY REAL ESTATE.  The prices will never be this low again, you can still usually borrow money to buy real estate and pay back later with money that is worth less.  Prices will go UP much faster than your pay will go up, so be ready for that.  Food cost will go up, and fuel costs will go way up.  Your pay will probably stay flat.  Consider a side business if you need more money.

What should the government do?  Well they were the ones that created this, they were lending money out so cheaply, and printing money like crazy to keep us afloat.  You got to remember that the government is over 9 trillion in DEBT.  They also have over 30 TRILLION in obligations to people in the form of social security and government retirements.  This is a huge debt.  So what they did is they tied this to CPI, the fake, government created index of inflation.  Today it was released and it was 0%.  The people on CNBC just laughed at how fake it is.  But because it is 0% that means that the social security debt does not go up this month.  Now, by any measure dollar is worth MUCH less now than 5 years ago, I would say it is worth half as much or so.  So basically the government just CUT their debt in half because of the weak dollar, and this is very smart.  But they can’t let people know this is going on, they have to spin this so that foreign investors and the general population don’t know what is going on.  For all the people who are not watching are going to be hurt, but for the government, the big investors and all the people who see the signs and act on it, this will be a great time of huge wealth creation.

Jason Dragon
http://www.jasondragon.com/
http://www.capitalactive.com/