If you’ve had anything to do with sales you will have come across the “ABC” of sales that being:
A – always B – be C – closing.
The best person to over dramatically tell you about the “ABC” of closing is Alec Baldwin:
I was considering today that while closing is an incredibly strong requirement in almost anything you do, whether you realize it or not, an almost equally important requirement is learning. Yes, that’s right, you may actually have to learn something after your schooling years. And modern research shows that people learn best through the use of pictures and moving images with sounds. So while I’ve provided one example above, here is an image that I will talk about below.
Safety requires that you may do something along the lines of what the previously mentioned article indicated: put your money in very low risk paper investments managed by someone else so you can see your numbers go up slowly, but you’re not really getting ahead.
Security can put you in a position where you have full or part ownership in the asset itself, thus having much greater control and if you’ve got the right assets, you’re hedged against inflation.
Let’s use some examples: paper, gold/silver, real estate – all of which can be bought and sold as paper (ETF’s for gold/silver and REIT’s for real estate)
Paper investments: Certainly not my favourite because it is so volatile. Global economies, currency wars, quantitative easing (i.e. pumping money into the economy), lack of control, etc. I’m sure people can rattle of a number of positives, and that’s fine, I’m merely stating my opinion. Looking at the Dow Jones Industrial Average (Wiki Link) we can see that it’s had some trouble in recent years and has always been prone to booms and busts. In the first graph, you will see the recent economic meltdown we went through and the subsequent rise of the DJIA. Keep in mind however, that this rise is fully due to the amount of money governments pumped into their economies to keep them afloat.
Therefore, when compared to gold in the second graph, you will notice that the DJIA has fallen and remained stagnant. Additionally, if these paper investments tumble further or are wiped out, you’re left with nothing, because you owned paper, not the actual business. So paper may be safe, but it certainly isn’t secure.
I had recently presented the RKG Investment Solution to the President of a wealth management firm in the Greater Toronto Area and I had mentioned that, in my view, there is a shortage of investment options. As I see it, there’s mostly just paper investment – stocks, bonds, mutual funds, GIC’s, etc. Commodities such as gold, silver, platinum, wheat, cattle, grain, etc., exist, but are difficult to store and manage, so the natural progression for these has also been towards paper investment – ETF’s (exchange-traded funds). And then there’s Real Estate; this is the playground I’m in.
Now the President of this wealth management firm listened patiently and then stated that he disagreed with my view on the shortage of investments. In his eyes, there are many investment options (mind you, they’re all paper based) however he did point out that an investment in Real Estate is one of the few secured investment vehicles out there. And on that note, I decided to point out the difference between Safe and Secured.
I had previously come across an article on Yahoo! Canada Finance dated Friday, August 27, 2010 with the title: “Safe investments with reasonable returns”. Naturally this piqued my interest because I am always interested to see if anybody mentions Real Estate. With a hefty lack of surprise, I found out that this article, like millions of articles on personal finance, talk about investing in the stock market via large funds. It certainly would be valuable to readers and action-takers to have guest columnists exposing the opportunities of various investment vehicles, not just the stock market. In the mean time however, I’ll go over it a little.