How many of you listen to talk radio? I was in the car listening to the local DJ and something caught my ear.
What peaked my attention was the topic; they were talking about dealing with finance, stocks, bonds, the future, etc.
I am going to be honest with you, it was an hour of the typical corporate financial spiel. The sad thing is that someone who was listening did NOT know how the corporate financial world worked, they would have really been impressed with this guy. The guest on the show had all the titles, letters behind their name and “years of experience.”
Needless to say I wasn’t impressed. In fact, I was kind of upset. Why? The guest was selling the audience down the river.
So what was the guest selling? The typical finance mantra which is “Work hard, save money, get out of debt, invest for the long term, and diversify, diversify, diversify.” I could not believe it, this guy was on the radio telling people how great the stock market is doing, how well it is performing and why everyone and their brother needs to buy into HIS COMPANIES “Get Rich Quick” mutual funds.
That was what he meant by “diversify… diversify… diversify.
Diversify into HIS mutual funds and life will be honky dory.
Listen, the corporate financial mantra is for those who don’t know what they are doing. It is also a total crock and a rip off. The big Wall Street guys are like foxes guarding a hen house. Once the hens stop laying eggs, they will pounce and eat them. The little guy investor are the chickens, and the fat cat Wall Street elites are the foxes.
Get what I am saying here?
I have what I call the Ten Commandments of Successful Investing™. I am not going to go over all of them, just the first three.
First commandment is “Thou shalt become educated.” Become educated and become your own best advisor. Make sure that you are not susceptible and become your own best advisor.
Second, “Have a professional investment counselor, who practices what they preach.”
Get advice from someone who is doing it and living it.
Third “Maintain control.” This is very important and this is one of my favorites and here’s why. When you relinquish control of your money, you leave yourself susceptible to three major problems.
We relinquish control by doing what?
We recommend direct investment. You should buy and control your own stuff.
The three major problems you are susceptible to if you don’t do this are…
No. 1, you might be investing with a crook. Obviously, I don’t have to tell you about Enron and WorldCom and it’s like the list is getting so long, its insanity.
No. 2 you might be investing with someone who is completely incompetent and you’ll lose money, OR back to No. 1, because of their dishonesty they are incompetent
But the third problem is assume they’re honest, assume they’re competent. –
No. 3 problem is they take a HUGE management fee off the top for managing the deal.
So you see why when I hear these sort of guys on the radio or see the talking heads on Sunday Morning talking about Wall Street it just gets under my skin?
When you’re a direct investor, you don’t leave yourself susceptible to this because you are in control of your investment and you see what happens firsthand.