Why You’re Not Rich

A few Monday AM thoughts on something that comes up all the time over cocktails:  People have bigger dreams than they have budgets.

Since this is (nominally) an economics website, I sometimes feel compelled to hold up the mirror to society and ask the genuinely brave to have a look.

Simple questions only:

1.  Have you actually read a book in the last month about making money?  You’d be surprised how stupid people are:  They expect to have money with no effort.   The world is a constantly changing place and everyone else is out to get YOUR money, so seems obvious to me that if you want more money in your life, you would study the subject a bit… Simply on the basis that “the more you study, the more you’ll make…”  Most people say “No…”  They don’t study a whit.  Which is why most people end up on Monday’s like this with a sense of dread and having to get back on the treadmill to eat… Sucks.

2. Have you tried your hand at economic forecasting?  Obviously, if you can spot the “hot new trend” and you can figure out who is making it, then tossing a few dollars on that bet is a simple way to make money.  But, have you either tried to forecast the economy this fall OR have you spotted a trend you could cash in on?  Again, most people say no.

3.  Do you regularly look at your personal financial condition (without BS’ing yourself) and come up with a plan to make a certain amount of money in a given period of time?  99 percent (or more) of the population has no financial plan or goals at all.

4. Do you buy one lottery ticket per drawing?  Obviously, your odds of losing are 100% if you don’t buy a ticket.  But, ONE ticket will get you in the game.  And THAT ticket isn’t too expensive plus it will spur you to learn about statistics of lotteries – and it makes statistics fun.  The odds suck…so put a threshold ($50 million?) and only bet one chance on the big ones.  The odds change between 1 ticket and 100 isn’t worth the price.

5.  When you listen to news, are you listening as a voyeur or as a rich person?  A voyeur will listen to the political crap, the Kardashian-like “people” stories and whatever tugs your social media strings.  But the Rich person has no time for that.  They realize that with enough money, they can pretty buy whatever kind of world they want to surround themselves with.  “Get off my island” kind of thing.

These are really simple questions.  But worth asking when it’s time to head out for work.

Which is why we tend to gloss over what’s “trending” and focus on ideas and concepts that can make us money….

Clouds of War

Donald Trump is hitting the tweets hard with warnings to Iran:


What set of “Tweets from the Chief” was the idiotic lingo from Iran over the weekend in which Iran threatens the “mother of all wars.

I believe the Iranians are (to translate into street-talk) just “talking shit.”

Still, we have picked up some terrorist chatter around the web of something in September…so we shall see what the next outburst is (from either side).

Let’s see if defense stocks pop, though, shall we?


Take the Chicago Fed National Activity Index just out as a good starting point, too.  Here’s the data — what does it tell you?

Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) rebounded to +0.43 in June from –0.45 in May. Two of the four broad categories of indicators that make up the index increased from May, and three of the four categories made positive contributions to the index in June.
The index’s three-month moving average, CFNAI-MA3, edged up to +0.16 in June from +0.10 in May.

Housing data will dominate tomorrow and Wednesday and then Thursday it will be Durable Goods – a bad number here could spook the markets.  GDP on Friday to round out your money-dancing card.

Fed Data

Again, if you’re going to be rich, it helps to know which way the Federal Reserve is stacking the deck.  If the Fed is increasing the money in circulation, some of it will find its way into new jobs, expanding the economy and eventually inflation.

But, when the Fed rolls the other way, the money gets tighter and things begin to slow.

Over at the Fed website we see the rate of increase (3-months annualized) was running minus 8-10ths of a percent through the end of May.  Through the most recent window (ending July 9) the rate of increase in M1 was 1.3% annualized.

If the economy is growing at 2.4 percent, this is NO WHERE NEAR ENOUGH.  It means several things:  1) the non-partisan (sorry for the joke) Fed wants the market to come down.  And, 2) they want rates to keep going up.

Pressuring the Fed? BoJ easing talk sends bond yields up.  Either the US Fed will be wrong for raising rates too far, too fast (our pick) or Japan is wrong to consider lowering.  (We don’t think so).  And exchange rate jitters persist globally: China says it won’t devalue currency to bolster exports.

What this means is the Fed seems to be applying the kind of economic pressure that will let (a good deal) of the air out of the Trump Bump before the November elections.

Fox, though, got in a lick for Trump-onomics with Tax cuts only help the wealthy, right? American paychecks show otherwise.

Now We Do Headlines

Going along with the notion that the non-partisan but democrat-leaning Fed is getting the economy ready for a pre-election slide, we see how JPMorgan Chase CEO opens up on the trade war, infrastructure ’emergency’ and Trump.

Although at the same time, some energy prices should come down based in part on Energy giants opening natural gas spigots, fueling profit rise.

Murder Cycle Research

Is this anywhere near our 135-140 day “murder cycle?”

2 dead, 12 wounded in Toronto shooter spree.

Only 90 days from the April 23 van attack that killed 10 and wounded 15.  So, is Canada on its own “cycle?”

Weathering Highs

103F at the ranch here in East Texas today:  But not everywhere: Heavy rain along the East Coast and no Heat Relief for the Southwest, Southern Plains.

We are not alone – it’s also summer in Asia where Record high in Japan as heat wave grips the region.

Moron the ‘morrow…  Dow and S&P futures flat, the NASDAQ down, so we look for the non-techs to follow ’em down…

35 thoughts on “Why You’re Not Rich”

  1. You are so right about reading George. I am a voracious reader and spend the first 2 hours of my day reading…and end the last 90 minutes before I go to bed re-capping my day with news updates and after hours trading news.

    We all should engage in a version of homeschooling ourselves. That’s how you get richer, both literally and figuratively. The tool of choice when reading is my 12.9 inch IPad Pro. It’s big enough to allow me to read my newspapers in a real newspaper view. I am old school that way. I grew up with reading newspapers and I like the look of a newspaper format…page turning and all. I begin at 5:30am and I read the entire e-editions (real newspaper formats) of the Wall Street Journal daily, The Financial Times, Urban Survival, CNET content, San Francisco Chronicle and a smattering of local real estate blogs, sites and MLS offering. Along the way, I adjust my Schwab and Coinbase accounts, based on the news of the morning.

    I then go to the gym to rampup my heart and brain with 60 solid minutes of either heavy cardio, Level 2 Yoga(both hot yoga and regular) or Core fit training and afterwards go to work…In my business, work starts after 9am.

    On the way to work and whenever I am in the car, I listen and switch between commercials to CNBC, CNN, Fox, and Bloomberg on SIRIUS/XM and get their take.

    After about 9 hours of making money the old fashioned way…Earning It…I take a brisk walk around the downtown area of my Bay Area town where I work to de-compress and keep the brain active…a few days I may even have a glass of red wine with some colleagues, then head Home…listening to music this time on the radio (Alt Nation on Sirius is my rebel side choice) and pop in a couple of healthy, made the same day meals for my wife and I that we ordered from the dozens of meal services that are available to us here…go for another walk, catch up on the days news and a few of our guilty pleasure binge watching shows, read for another 90 minutes or more and go to bed.

    You will see that there is a lot of brain activity there. If you train the brain, you will fatten your wallet guaranteed. It’s worked for me…and whoever is reading this, Urban Survival and Peoplenomics is a fantastic first step to that path to brain health and wealth.

    • Thank you Mark…that is one of the best posts you’ve ever done….most appreciated by all.

      • Dear George: In re: “Rich.” To be Rich a stock must be held long where the EARNINGS MULTIPLE EXPANDS over a longer period of time, as EARNINGS GROW in a “steady” manner. THINK of AMZN or NVDA! If you spent all of your “financial time” on figuring out a real list of candidates, with these TWO Potentials, then bought the items, (Using stops to stop losses if wrong), then big big gains would be possible) Odds are something like 350-1, but this is better than the lottery odds. Please think about developing a pay site that only does this with dedicated and focused purpose. Make sense???

    • Mark, you appear to have a very efficient lifestyle and it seems to work for you. Others of us have lived the “use every minute lifestyle”, and have made enough to ask the question “Can I ever spend my resources in a way that matters to me within my projected lifetime?”. Yes, I probably could, but it’s down to how valuable is unstructured time? For me, it’s incredibly valuable, since I do have a rich inner life, though without the magical ability that George has to remember dreams and replay them like movies. Some of us value money and others value stress-free time. I use my stress-free time to build things that matter to me. It’s a personal value judgement and life balance.

      I absolutely agree with regular reading in depth and breadth, though I rarely read paper books. Screen reading in single column scrolling format is best for me. Most reading is the current state of the art in various sciences, engineering, geopolitics, arcana, finance, codes and regulations, local news, and my nemesis – the Chinese language. The Ure publishing universe is definitely important daily reading!

      BTW, George – I had the pleasure of buying a copy of your Millennial Manual as a birthday present for a relative. She’s interested and I’m sure it will help her. I’d suggest this for others, since it’s dirt cheap and provides real value to the target audience.

      We all get a mouse-over event called life, and what we do with it is up to us with interventions from various pseudo-random externalities(Adjustment Bureau, anyone?). I’m sure that if I still had a wife/girlfriend in my life, I’d have ten times the financial resources I currently have, because of both the incentive value and having a trusted partner. As it is, I can do whatever I want financially. The real challenges are those things that can’t be delegated or bought.

    • You’re going to get cornholed reading all that garbage. Your job is going to go up in smoke. Gay Bay will be an unlivable hell hole. Mark my words.

  2. I remind you of a previous comment you published. As I have taught the kids, No one living on the North American continent in the early 21st century can claim to be anything but rich. How we define poor compared to the rest of the world is ludicrous. Remember my original comment was based on a conversation with my dad where we discussed a PBS show we had watched (yeah, that kind of family) where the commentary said the per capita income of the world was (at that time) $500.00 annually. I asked how people could survive on that amount, and he replied that you have that choice to make daily, whether you will get up and do what is necessary to survive or not. You have published an excellent paper on how to get by on a small amount – I believe it was $10,000.00 – which points out the unrealistic expectations most of us have. The best advice I have read is “live within your means” which is not impossible, as you have shown. It is a matter of choices. I heartily agree with planning and investing to make income (and I have examples may son and his wife, while college students managed to save enough to buy him a big wheel pickup truck by saving their change – over $4000.00 – in a single year!). And while goal setting is great and setting big goals is recommended, establishing goals for income and getting by are easier if the goals are realistic. This is the first step of “prepping”.

    • Absolutely…
      You will do anything to survive and provide.
      Everything has its price..

      • People can survive selling garlic on the streets or shining shoes. No one cares how they do what they must… to make ends meet.

  3. George. Gee, what a surprise. The Fox article on Trump-onomics (misleadingly) does not mention that 82% of the tax cuts went to the top 1%. For context, this means that if we gave out 100 bananas, one guy got 82 and the rest averaged 1/5 of one.

    Paul Krugman tweeted today: “Textbook econ said that if you sharply cut taxes in an economy near full employment, the result will be higher interest rates, a stronger dollar, and a bigger trade deficit. Sure enough, that’s more or less what’s happening, although the dollar hasn’t gone up all that much [yet]”

    Besides exploding the national debt, these tax cuts have other negative results such as inflation and rising interest rates. Obviously, the only folks who should have gotten tax cuts were working families.

    Best, Mike

  4. Mike: I think you finally got something right with the Pres Trump tax cuts. Even the Dems agreed with the tax cuts, so their contributors would have more money to give them. Just like the Regan tax cuts. I broke even…No financial benefit.

    Have a banana on me.

  5. Item # 4: My Lotto preference is the Carolina Cash 5 quick pick, although I am working on remote viewing the winning numbers.

    Odd are 1 in 750,000. Very doable.

  6. A couple ‘things’ – first, Iran has been using that kind of language for literally decades. President Trump should not have ‘taken the bait’ by tweet shouting or any other response to what was essentially ‘noise’. If he knew the history of the region, he would have known this – it is so common.

    Secondly,I am rich – though not in the way you mean . . . but I had a better chance of attaining my kind of wealth than becoming a one-percenter. My riches come from trying to understand the world around us. Although I will admit that I will always need to keep learning (and not be so ‘full of myself’) – there is so much more to learn – and not just about finances.

    I have relatives who only care when it comes to making money, and little for anything else (and miserable people they are!)

    Not that many people will attain financial wealth, but if you have the ability to think you are wealthy indeed, more than President Trump!

    • What do Pres Trump & Pres Clinton have in common? A burning passion to become President. One started out poor & one rich. Now they are both rich & have fulfilled their dream. You can have it all in America.

  7. Item #2: It would be nice to add a new section to Peoplenomic’s. HOT NEW TRENDS. I think you have a better 6th sense for these type of things than most of your readers. Unless I actually buy or use the newest hot trend, it goes right over my head, ie Facebook (& that is even old news).

  8. “Have you actually read a book in the last month about making money? ”

    My day starts out early..I too love the quiet of early morning and late night to sit back and read. This month so far. I’ve read two on financial, three on the physics of mapping the cosmos, six books on philosophy. Today’s read is the dream of enlightenment. The rise of modern philosophy..great book same stuff but I like his perspective. Gottieb is the author..the second book for today is mapping the heavens.. By Natarajan..both on things I have read before..I scan the worlds newspapers on newseum.org and the paper boy to decipher the pushed scripted cheap and real news.
    I put my ugly hat on and go for morning walk ..there’s nothing better than the sunrise and sunset fresh air..since I’m almost deaf I don’t listen to much radio or television..most of it is the same old blah blah. My biggest fear is when I started going blind.. I was terrified..started to teach myself brail.
    At the bottom though it doesn’t make any difference..its designed to keep you at the bottom. Now lottery..if you check it out the winners are picked in regions..just like banking regions ..routing.. Our region will hit in five to seven years. Our state has a winner every twenty five to thirty years. After the next winner here I will not buy another ticket since I will be hooting a hundred our next time up for our state..lol.. Unfortunately George.. Your in the same region I am lol..
    There is nothing random except who is the winner.
    So good luck..oh with as much as I’ve lost I should be the next winner lol..
    Although the odds are if you went back to the time of Plato spent a hundred a day.. You’d still have a 75 percent chance at losing.
    My curse and gift is I see everything as a number. Everything as numeric value..when I worked with them I could do logs and mol’s in my head.. I doubt I could do that today. Every surgery I’ve had I’ve been aware. I can’t move but I’m aware. So I tell them smoke me good..I don’t want to be aware lol.. And for gods sake don’t say oops..
    As a bar trick I’d draw I th one hand nd write with the other or stand an egg on end lol resucitating a fly is good for twenty.

    • My granddaughters teacher told her it was impossible so she had me balance an egg and send her the picture lol..I have a friend Jeannie she reads twice as much as I do..she to is a bottom feeder met her in the stacks of the library of congress. We were talking a short time ago and she says..if I ever meet someone smart that could help me with.. (Some issue ) I said come on young lady..( she has to be shooting ninety in the foot) just consider who your talking with and I’d think twice about debating you lol lol most of the kids are stuck in a bubble

  9. As of this weekend, it appears that GLP has gone full Facebook! It’s off limits unless you register with a credentialed email, so you’re just as tracked and traced as on other social media. R.I.P. GLP.

    Various “alt-right” media are being tossed from payment systems, notably PayPal, including GLP and others. Hopefully not Peoplenomics. It seems that “Broken-Web” has begun to arrive.

  10. “Uncle Sam has been demanding less from us in tax payments. And as a result, American families across the country are better off now because they are benefiting from bigger paychecks and more jobs”

    OTFLMAO….lol let me bend over so they have a better shot at blowing that smoke…lol

    Its statistical averages not actual..

    Statistics say everyone at a fast food burger joint is making thirty dollars an hour..lol

  11. George , this comment doesn’t have anything to do with your article today , but I thought it is very much worth mentioning to you and your readers.

    Canary in the coal mine ? Perhaps…

    I recall several instances of this type of behavior happening before the ’08 crash. All of it surrounded Amex. Friends had balances on revolving credit called due immediately with threats. Was in court twice and noticed both times a large percentage of the defendants were going up against Amex for similar. Accounts being closed with no notice or reason. October !

    Fast forward.

    My wife received a complimentary platinum card for her business. We used it often and many times had balances into 6 figures. Always paid off , always on time , and in some cases , when requested by Amex , she made large payments before the due date. All along the way , you’re constantly told that your payment history raises their trust in you and your secret limit.

    I assist a high wealth individual. I am keenly aware of his charges which routinely go 6 figures in a month. Active account for over 30 years with zero issues. No disputes , late payments , none of it. This guy should be a DREAM cardholder for them.

    Within the last week , both my wife and this person received notice that their accounts had been inactivated and that if access is not given to each persons tax returns that the accounts will be closed in 14 days. All trips cancelled. Hotels cancelled. Points surrendered. No calling customer service with questions , requests , NOTHING.

    Repeating their pattern from 2008.

    My wife has customers who use Amex cards and she has had charges declined from Amex at an alarming rate. The customers are confused and have no idea why. They are having their accounts closed too with no notice.

    This doesn’t fit into your long wave stuff. It’s purely speculation , but every person we talk to says the same thing. “Amex must know that something is coming”.

    I agree.

    If it means anything to you or your readers , I request that you post this in your comment section.

    Thank you.

    • Boy Dave.. I know what your feeling.. we lost our only source of income a few years back and had to go a year without an income.. unfortunately we discovered that all that give away money is non existent.. even the unemployment insurance.
      Where we lucked out is I followed what our church teaches..what I discovered is what they recommend is not enough it should be double or more.

    • The “request for tax info” IMHO is a clever ploy to eliminate customers….nobody is going to give them that info merely to keep a charge card. But why would Amex do that?
      1) Notice that both customers named above are running six figures a month in charges. If I’m worried about a liquidity event, these are the customers I have to ditch first. These are the people a lock-up of liquidity would hit first, making them unable to pay immediately. J6P+s who have an Amex card have some savings, and jobs, which means they’ll pay. Amex is supposed to be paid in full each month (or was). So they have a reasonable chance of getting the low hanging fruit.
      2) “My wife has customers who use Amex cards and she has had charges declined from Amex at an alarming rate.” Same idea, keep the balances Amex is owed low.

      This sounds like “save the firm and d**n the bad PR”.

  12. Ameerica has been itching to “bomb, bomb, bomb, Bomb Iran” (courtesy of John McCain) for quite a long time now, and of course, they are not alone as they have silent partners! Hard to tell if we manage the silent partner or the silent partner manages us! Talking about Woo Woo; good to keep an eye on Dannion Brinkley’s prophecies from 1975: http://www.qsl.net/w5www/brinkley.html especially this little snippet (but all of them together are quite interesting): “Box 11 began with Iran & Iraq in possession of nuclear & chemical weapons. Included in this arsenal was a submarine loaded with nuclear missiles. The year, said a voice in the vision, was 1993. I saw this submarine powering through the waters of the Middle East, piloted by people I knew to be Iranians. I could tell that their purpose was to stop the shipping of oil from the Middle East. They were so praiseful of God, in their speech, that I had the sense that this was some kind of religious mission.” I would imagine that people in the KNOW are aware of these prophecies.

  13. MSM handling of the Toronto shooting noted in your Monday report has been quite extraordinary. The public was told in no uncertain terms following the tragic event that the gunman was a white man. We prefer the less inflammatory “caucasion” designation.

    Toronto’s Special Investigative Unit tasked with determining whether the gunman died at his own hand, or the police, or a malevanent hand have released the man’s name. He is not caucasion although the MSM diverts attention with mention that the man’s family is profoundly saddened and their son was depressed and mentally ill for a considerable time.

    Many questions remain. Will the perp’s Pakistani ethnicity, residency in a “diverse” suburb, and method of radicalization be up for discussion? How does a supposed nutcase get a hold of a handgun in heavily gun restricted Canada? What psychoactive drugs was the perp on?

    We won’t hold our breath awaiting answers.

  14. America created the worlds largest Middle Class in the 20th century but somehow did not manage to protect this achievement. Now we are in a world where 1B Chinese, I Billion Indians and a host of other Economic competitors are gaining serious traction viz a viz the west. This is not to mention the Political Competitors but THE point is… KEEP YOUR EYES PEELED GOING FORWARD!

  15. I put the number eight in my wallet years ago when you mentioned it
    Shortly thereafter I met a dream client that bought me a six pack of new
    Lexii through commissions and that relationship lasted well over 10 years . He obviously was a member of the one percenter club . When that business relationship ended another windfall through a business partnership. We just unexpectedly were surprised with a very generous
    Inheritance. was it the figure 8? It’s still in my wallet .

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