Friday, 3 June 2011

On becoming a rational investor (Part 7 of 9)


Economists speculate all the time about next year's rates of unemployment, inflation or deflation. For your personal investment decisions, you don't need to wait until the exact figure is known. On most occasions, knowing the general trend is enough to make rational investment choices.

If newspapers are discussing whether next year's inflation is going to be 6% or 7%, that tells you as much as you need to know. Take swift action and reflect about how to structure your finances to deal with such price increases.

Worrying is essentially a waste of time. Although you cannot reshape the world according to your taste, nothing prevents you from taking measures to minimize trouble.

To be continued in the next post.

[Text: http://johnvespasian.blogspot.com]

[Image by Fr Antunes under Creative Commons Attribution License. See the license terms under http://creativecommons.org/licenses/by/3.0/us]

On becoming a rational investor
(Part 7 of 9)


Economists speculate all the time about next year's rates of unemployment, inflation or deflation. For your personal investment decisions, you don't need to wait until the exact figure is known. On most occasions, knowing the general trend is enough to make rational investment choices.

If newspapers are discussing whether next year's inflation is going to be 6% or 7%, that tells you as much as you need to know. Take swift action and reflect about how to structure your finances to deal with such price increases.

Worrying is essentially a waste of time. Although you cannot reshape the world according to your taste, nothing prevents you from taking measures to minimize trouble.

To be continued in the next post.

[Text: http://johnvespasian.blogspot.com]

[Image by Fr Antunes under Creative Commons Attribution License. See the license terms under http://creativecommons.org/licenses/by/3.0/us]

On becoming a rational investor (Part 6 of 9)


From this perspective, those phenomena are similar to the influenza virus that marks the arrival of winter every year. Exaggerated concern seldom improves anything. Instead, individuals should identify the path that minimizes trouble and, if possible, allows to profit from it.

Whenever you hear that inflation or deflation are coming, ask yourself how you can structure your finances in order to benefit from the situation.

Can you link your income to a product whose price is likely to increase or decrease at the same pace as the overall economy? Can you reduce the amount of cash that you require to live and invest the remainder in assets that will profit from upcoming economic changes?

To be continued in the next post.

[Text: http://johnvespasian.blogspot.com]

[Image by Orbisnonsuficit under Creative Commons Attribution License. See the license terms under http://creativecommons.org/licenses/by/3.0/us]

On becoming a rational investor
(Part 6 of 9)


From this perspective, those phenomena are similar to the influenza virus that marks the arrival of winter every year. Exaggerated concern seldom improves anything. Instead, individuals should identify the path that minimizes trouble and, if possible, allows to profit from it.

Whenever you hear that inflation or deflation are coming, ask yourself how you can structure your finances in order to benefit from the situation.

Can you link your income to a product whose price is likely to increase or decrease at the same pace as the overall economy? Can you reduce the amount of cash that you require to live and invest the remainder in assets that will profit from upcoming economic changes?

To be continued in the next post.

[Text: http://johnvespasian.blogspot.com]

[Image by Orbisnonsuficit under Creative Commons Attribution License. See the license terms under http://creativecommons.org/licenses/by/3.0/us]