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Golden Rules for Making Money (1880)

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Re: Golden Rules for Making Money (1880)

#141

Post by purplelobster »

dalke wrote: post #134
madaxe_again wrote: post #127

Earlier quoted context omitted.

They are acclimatised to debt - most westerners can't imagine not having a credit card - when I tell folks I cut up my first and last card at 17 they assume I'm a delinquent, broke, punishing myself - for in this society we have managed to redefine debt as wealth .

Here in Sweden, people have a debit card or use a debit app. Most people here easily get through life without a credit card. While I don't think it's true that "most westerners can't imagine not having a credit card", I don't have a sense of how much other Western countries use credit cards as compared to debit-based systems. http://news.bbc.co.uk/2/hi/business/5380718.stm from 2006 says that UK has the most credit c…

Funny thing is, as a European I never saw the point in credit cards. So when I lived in the US I didn't get one for a few years. Finally my girlfriend pushed me to get one for the free cash back, but the application was denied since I had no credit history (yet a high-paying job and $100k in the bank...). Just weird. You have to be in debt to show that you're responsible enough to handle debt.

Re: Golden Rules for Making Money (1880)

#142

Post by StephenConnell »

Retra wrote: post #111
StephenConnell wrote: post #90

Earlier quoted context omitted.

If prosperity is "having wealth", then redistributing wealth does bring prosperity. But then you could also say that stealing brings prosperity. Could you not?

You could, but you should be aware that "stealing" is not an act per se, but a moral qualification of some other act. Namely, the redistribution of goods. The only difference between theft and charity is your personal moral inflection.

A couple more definitions from Google. Charity: voluntary giving of help, typically in the form of money, to those in need. Stealing: to take without permission

I am an advocate for charity. But redistribution through taxation feels like stealing to me.

Re: Golden Rules for Making Money (1880)

#143

Post by [deleted] »

Mahn wrote: post #67

It's interesting how flat human nature stays over time, how advice given 136 years ago is still perfectly applicable today. Over the course of centuries life has changed dramatically, but we still think, worry, feel and act like our ancestors did from a millennium ago. I'd bet you could easily find advice given in the roman empire times that would still be relevant today.

[deleted]

Re: Golden Rules for Making Money (1880)

#144

Post by ezequiel-garzon »

IkmoIkmo wrote: post #140
ezequiel-garzon wrote: post #24

SNL made a wonderful infomercial in 2006 about point 3: avoid debt. Depending on your location you should be able to watch it in [1] or [2]. During my years in the US it always puzzled me that, upon reaching my credit limit, it would not just increase without any interaction, but sometimes double! American "plastic", as hailed in "The Graduate", was a significant lesson for me. [1] http://www.nbc.com/saturday-night-l…

'avoid debt' is too simplistic. Debt is simply an opportunity increasing instrument. You have no money to make certain investments that create a net benefit, debt gives you access to that opportunity, and it comes at a cost. If that opportunity is worth the cost, debt is great. Of course it makes sense to say 'avoid needless debt', or 'be careful taking on debt', but just to just say avoid debt is to also say avoid t…

'Avoid debt' is an apt title. The points the author makes agree very much with yours, including the clear warning the infomercial gives against compulsive, superfluous spending:

"I do not speak of merchants buying and selling on credit, or of those who buy on credit in order to turn the purchase to a profit. The old Quaker said to his farmer son, "John, never get trusted; but if thee gets trusted for anything, let it be for `manure,' because that will help thee pay it back again.""

Re: Golden Rules for Making Money (1880)

#145

Post by tmd »

A lot of old-school financial advice seems to focus on the importance of saving and avoidance of debt. It seems reasonable but I always wonder how applicable that is in the modern times with our record-low interest rates. Short look at the tables in [1] suggests that, for example, you could gen 5% after-tax real returns on government bonds in the 19 century. Today, that would be unthinkable.

[1] http://efinance.org.cn/cn/fm/The%20Equity%20Premium%20Stock%...

Re: Golden Rules for Making Money (1880)

#146

Post by joslin01 »

Wonderful writing.

> The inordinate love of money, no doubt, may be and is "the root of all evil," but money itself, when properly used, is not only a "handy thing to have in the house," but affords the gratification of blessing our race by enabling its possessor to enlarge the scope of human happiness and human influence. The desire for wealth is nearly universal, and none can say it is not laudable, provided the possessor of it accepts its responsibilities, and uses it as a friend to humanity.

> So in regard to wealth. Go on in confidence, study the rules, and above all things, study human nature; for "the proper study of mankind is man," and you will find that while expanding the intellect and the muscles, your enlarged experience will enable you every day to accumulate more and more principal, which will increase itself by interest and otherwise, until you arrive at a state of independence.

> When a man's undivided attention is centered on one object, his mind will constantly be suggesting improvements of value, which would escape him if his brain was occupied by a dozen different subjects at once. Many a fortune has slipped through a man's fingers because he was engaged in too many occupations at a time.

Re: Golden Rules for Making Money (1880)

#147

Post by rorykoehler »

tomp wrote: post #135
rorykoehler wrote: post #131

Earlier quoted context omitted.

From where I am standing it seems capitalists feel entitled to free cash. They take their capital, dump it in the stock market and hey presto free cash! This free cash mostly arises due to some accounting trick and is not productivity backed at all.

Which accounting trick?

There are many. To name a few: synthetic CDOs (the 2008 mortgage crisis), insider trading (Martha Stewart), rate rigging (LIBOR scandal), Ponzi schemes (Madoff) and straight up cooking the books (Enron).

I hope that's enough to refresh your memory? It's irrelevant to my original point though as capitalism is by definition hoping to get something from doing nothing (or making money work as the propagandists like to dress it up as).

Re: Golden Rules for Making Money (1880)

#149

Post by rorykoehler »

meric wrote: post #138
rorykoehler wrote: post #131

Earlier quoted context omitted.

From where I am standing it seems capitalists feel entitled to free cash. They take their capital, dump it in the stock market and hey presto free cash! This free cash mostly arises due to some accounting trick and is not productivity backed at all.

People who see the stock market that way are merely gamblers and will have their chips taken away in the next financial crisis. During 2014-2015 I've participated in a lot of share issues to provide cash for gold mining companies requiring capital to move into or expand production. These are companies with a few hundred shareholders or so. The profits I've made in the past few months from gold mining companies, I thi…

I don't resent anyone who chooses to play the game and wins. We just make the best of the system we exist in however I do believe in being honest about the system too.

Gold has a value purely due to it being vital in many technologies. That said I can't imagine the price we pay for mined material, gold or otherwise, even comes close to reflecting the cost of what it will take to repair the damage we are doing to our environment during the extraction of these materials.

Regarding productivity there are many instances of financial products which are not even remotely linked to any kind of productivity. If the stock market was strongly linked to productivity the down cycles it experiences would be minor in comparison to what they are.

Re: Golden Rules for Making Money (1880)

#150

Post by pm90 »

madaxe_again wrote: post #127
tuttifrutti wrote: post #120

Earlier quoted context omitted.

I was always puzzled how people in the US are quick to spend on credit, and not worry too much...

They are acclimatised to debt - most westerners can't imagine not having a credit card - when I tell folks I cut up my first and last card at 17 they assume I'm a delinquent, broke, punishing myself - for in this society we have managed to redefine debt as wealth .

If you pay all your credit card debt on time, there is really no reason to not have a credit card. Sure, you have the capacity to spend a lot of money, but I view that as a benefit and not a curse. Also, I feel a lot safer, since if there are any unauthorized purchases made with the card, the company takes care of it.
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