Tag: buying stuff
Everybody makes money at
by drinker on Jul.07, 2009, under Economics
If you ever hear someone tell you that “everybody makes money with ‘something’ ”. This is a clue that the bubble that is “something” is going to burst. Some common examples and the time periods of this are the following:
1. Late 1920’s “Everybody makes money with stocks!”
2. Late 1990’s “Everybody makes money with tech-stocks!”
3. Mid 2000’s “Everybody makes money with real-estate!”
Granted most of this is hind sight but I did warn those around me in late 2006 that this whole housing thing was getting out of control. I know that I am freaking genius (sarcasm). Many people lose their head when it comes to the purchase of investments. What people should look to when it comes to any investment be it a house that your live in (not really an investment) or a share of a business is what is it really worth.
In the case of house, are the mortgage payment and other expenses, worth the joy and security you get by living in it? How much is it really worth to stay dry when it rains. How much is it worth to have all your friends envy your place of residence? How much is it worth to not hear the whore in the apartment next to you?
Is the business you are becoming part of worth the initial investment? Will the business turn a profit quickly or will it take years to turn a profit? Will the business be such a thorn in the side of another business it will be bought out (which was a viable tactic in the dot.com days)? Or finally can you convince some other fool that it is worth more then what you paid for it (this is the case of just about every tech stock in the late 90’s)?
