Monthly Archive for March, 2012

Investing in generational wealth!

When thinking about investing decisions, I have long been inspired by the Egyptians who decided to build the pyramids.

These were people  who had a vision so grand, they knew that only their grandchildren would be there to enjoy the fruits of that vision. As Charles Handy so eloquently writes: “Set your sights on immortality, or as close to it as you can get, and most of the ethical dilemmas sort themselves out. Today the skyscrapers of business tower over the old cathedrals. We must hope that those who build the enterprises within them are cathedral builders in their turn, for if they fail us then we all fail.”

Building true wealth has really nothing to do with money but everything to do with relationships. Having loving, lively, healthy relationships within family is true wealth.  Gods pipeline for blessing is the family unit.

“Abraham will surely become a great and powerful nation, and all nations on earth will be blessed through him. For I have chosen him, so that he will direct his children and his household after him to keep the way of the LORD by doing what is right and just, so that the LORD will bring about for Abraham what he has promised him.” (Genesis 18:18,19)

Therefore, our first priority in investing decisions must be to build generational wealth. Am I thinking about my children’s children?

It is interesting that the influential economist, whose policies still influence us today, John Maynard Keynes, was not a family man. He was openly homosexual and had no mind for the family unit. Once, when asked about the long-term effect of his tax-and-spend infllationary policies, he replied “In the long term we are all dead!”  This is existential thinking which centers around personal gratification and has no room for long-term investing in the future of our children’s children.

I also see a connection between rise in abortion and in debt fuelled spending. Neglect of children, coupled with a willingness to kill them, coupled with the burdening of them with future debt  for the sake of immediate consumption cause both abortion and debt fuelled crisis.

Fortunately, as  Christian, I know we will live in eternity. I want my investments to count for eternity, to begin with my children’s children. That’s what I am working on!

Bankers & the Muppet Show …

“Over the last 12 months I have seen five different managing directors refer to their own clients as ‘muppets'”… said Greg Smith, a vice-president of Goldman Sachs investment bank last week, in an open letter to the New York Times.
Conclusion; the bank only cares about itself and not its customers! It only sees customers and money making objects by selling them products of dubious value which the bank wants to get rid of.  “It’s purely about how we can make the most possible money off of them. If you were an alien from Mars and sat in on one of those meetings, you would believe that a client’s success or progress was not part of the thought process at all,” wrote Smith.

Everyone thought that they could create value out of thin air and forget the basics of business – that wealth only comes form creating true value anf no clever financial engineering can create value out of something that was not there to start with.

Michael Douglas, as Gordon Gekko in the film Wall Street 2, descibed this well ….
“But it is greed that makes my bartender buy three houses, he cannot afford with no money down. And it is greed that makes your parents refinance their 200,000 dollar mortgage for 250,000 dollars. Now they take that extra 50,000 dollars and go to the shopping mall so they can buy a new plasma TV, cell phones, computers and an SUV. And hey, why not a second home while we are at it. Gee Wiz, we all know the prices of houses in America always go up. Right?
It is greed that makes the government of this country cut the interest rates to 1% after 9/11 so we can all go shopping again.
They got all these fancy names for trillions of dollars for credit, CMO, CDO, SIV, ABS. You know I honestly think there are only 75 people in the world that knows what they are. But I will tell you what they are, they are WMDs. Weapons of mass destruction!”

Goldman Sachs CEO, Loyd Blankfein said in 2009 that Goldman Sachs were ‘doing the work of God’, defending the bank’s mega-profits.

Clearly, the ‘work of God’ consists of the second great commandmentwhich Jesus told  to ‘love your neighbour as yourself’and not to earn money at the expense of your customers. ‘the muppets.’

Customer service is the reason for the existence of companies. True profit lies in the ability of a supplier to to serve their customers in order that they can realise their goals.

Mark described Jesus’ mission. “For the Son of Man came not to be served but to serve and give his life to set many free” (Mark 10:45.)

This is also my mission – to serve my customers and help set them free to enjoy all God has given them!

Economic crisis puts marriage under pessure

Next year, a few thousand marriages more will break down due to economic problems. Also less marriages will occur due mainly to economic problems.

The ING Economic Desk analyzed statistics from the Central Bureau for Statistics in The Netherlands about marriage over the last 30 years, and the effect good and bad economic times had. Chief Economist Charles Kalshoven said that increasing unemployment led, a year later, to an increase in marriage breakdown. The analysis showed that over the past 30 years there is a clear correlation between unemployment and divorce.  “On this basis, you could expect , between 2000 and 4000 extra divorce cases extra next year”,  he says. On the other hand, 1% extra economic growth can have a positive effect on the number of marriages, and one can expect a growth of 2000 marriages more, two years later. When people have a good perspective of a permanent employment or increasing prospects, the decision to marry is much easier.
“In the current economic uncertainty, it makes sense to delay the marriage,”says Kalshoven, “because an average marriage costs easily €10,000.”  Source Leidsch Dagblad March 14, 2012.

I can remember our own wedding, almost 40 years ago. Cost the equivalent of about €250. Our first home was a flat in west London with a shared bathroom! Money would never have kept us from marrying! Our love was stronger than desire for material stuff. This analysis from the ING reminds us of how strong the grip is of money on our social institutions.

The words of Jesus of Nazareth remain challenging ..”You cannot serve both God and Money”. If we take decisions solely on economic grounds, then we are serving the wrong god… in this case, the god of money. Couples can learn to be content with less and trust in their love for one another, learning to be thankful for the little they have. It is only when we learn to be really thankful for what we have, and using this wisely, will we be ready to handle much.  Jesus also said, “Whoever can be trusted with very little can also be trusted with much!”

Learning, as a couple, to live from a small budget, learning financial discipline, being content with what you have, will give a firm foundation to be able to weather any economic storm which may happen in the future.