Own A Piece Of Your Own Rock

Decades ago, my dad told me … when listening to advice … find out if they have accomplished what they suggest … before you follow their advice. (Actually, my dad’s expression was, “Make sure they eat their own cooking.”) Warren Buffet fits my dad’s description.

Warren Buffett’s insights are crystal clear, simple and make sense..... here’s 2 Buffett minutes by motivational speaker Chris Howard (http://symbiosis4u.us/MP3/Audio.htm and click on the top left link).

And, here’s a few of Buffett’s insights that I found particularly useful:

1. If everyone else is doing it, be careful … because even a dead fish can float downstream.

2. Successful investing depends less on the size of your circle of competence, and more on staying away from the perimeter. Stepping over the perimeter of your circle of competence transitions you from investor (business owner) to speculator (gambler).

3. The single biggest cause of the recent meltdown on Wall Street was (and still continues to be) people investing like “day traders.” Too many people assess stock certificates like cards in a hand of poker, rather than proof of ownership for a piece of the business. Without dividend oriented ownership, speculation will always produce gyrations in stock prices.

If you are unfamiliar with Warren Buffett, consider this: In 1979, you could have purchased his stock for $290/share. Today it costs $120,000/share … IF you can find someone willing to sell. You can read more about Buffet’s investing philosophy by reading some of his annual Chairman's Letter to Shareholders. http://www.berkshirehathaway.com/letters/letters.html


In terms of business ownership, there are only two ways to own a business. You can either own your own business (http://symbiosis4u.us/MP3/TurnKey.mp3) … or you can own a piece of someone else’s business.

If you own a piece of someone else’s business, you show ownership by supporting the business whose stock you purchased. Consider: if you own stock in Coca-Cola … yet you drink Pepsi-Cola …. you are not a business owner of Coca-Cola stock. You are “day trading” with Coca-Cola stock.

Think about it! If your ONLY monthly income came from your stock in Coca-Cola, would you encourage anyone to buy a soft drink from any other company? A Coca-Cola stock owning evangelist will attempt to get family, friends, co-workers, and even strangers to drink Coca-Cola products. The more people who buy Coca-Cola products, the higher the company profits, the higher your monthly income from dividend checks. Listen to comedian Andy Andrews discussing Coke versus Pepsi. http://symbiosis4u.us/MP3/CokePepsi.mp3

Back in the 1980’s when Lee Iacocca took over Chrysler, the executive parking lot was full of Mercedes, Jaguars, and Porches. Because Chrysler executives were “day trading” with their jobs, Iacocca gave his executives one day to get a Chrysler car, or get a new job.

Note: quality improved dramatically soon after the Chrysler executives had to drive Chrysler cars. They did not want to drive poorly designed and poorly build cars. Iacocca caused Chrysler executives to stop being “day trading” employees and begin functioning like owners. What a pity they did not continue.

Owning a piece of someone else’s business has been one of the primary means of investing for retirement (long term investment as opposed to speculative investment). Many corporations set up 401K accounts (or is it 201K now?) so employees could invest in other businesses.

Question: Did 401Ks become 201Ks because their managers stepped out of their circle of competence and became speculators?

Is that question too harsh? You decide … after you have considered a different kind of comparison.


Since 401Ks began in 1978, tell me any 401K account which has averaged 25% growth from dividends per year, every year?

Can’t think of any? Then consider this easier question.

Since 1978, do you know of any 401K account with a ROI (Return On Investment) of 25% of the monthly contribution … per month … every month?

Yet, such profits are quite common with personal businesses. Unfortunately, few corporations encourage employees to start their own personal businesses.

Caveat: 25% per month is common, but NOT on the aggregate. If a person spends $300 a month on “stuff” from their own business, they can reasonably expect to receive a profit sharing check (like monthly dividends) for about 25% of what they selectively purchased. Currently, in excess of 100,000 items, including from 20% to 80% of “stuff” most families purchase regularly, are available for purchase … with automatic monthly profit sharing.

Based on Warren Buffet’s concepts, augmented with my perceptions, the basic problem with investing by employees is this: other businesses can make money from employees … employees cannot … especially not from themselves.

Allow me to illustrate how pejorative that is for employees.

If Costco were to offer free memberships to employees, which increase Costco profits … most corporations would accept the offer. (Costco is NOT the only membership shopping program http://symbiosis4u.us/Newsletter/Membership.pdf .) But, if Symbiosis Enterprises offers employees 25% profit margins for personal purchases, which also increase my profits, most corporations would not accept.

Is that statement too harsh? You decide after you have reviewed how corporations perceive the abusive (and historically accurate) practices of a classic personal business. http://gr8team-tnt.info/TNT/Ninja.htm

Let me close this newsletter with a question.

If you had a choice between investing $300 every month in your 401K (with whatever return it currently offers), OR re-directing $300 every month (of money you are already spending) in order to receive $75 in profit sharing … which would you choose?

Of course, I won’t explain how a mere $75 a month in profit sharing could fund your $300 a month 401K investment … because … that will be a good subject for a future newsletter.

World Wealth Report

The 11th annual World Wealth Report (2010) from Capgemini finds there are now 9.5 million High Net Worth Individuals (HNWI) in the world, which is up 17% from last year. (A High Net Worth Individual has at least $1 million in all assets, excluding their primary residence.)

Here’s a synopsis of the report:
3.2 million Millionaires in North America
2.9 million Millionaires in Europe
2.3 million Millionaires in Asia

The Capgemini report also indicates the average HNWI increased their net worth by a 21% since the 2009 report. Reports like this makes me wonder what HNWI do that I do not do, because I rarely experience that kind of increase.

Social scientists like Noah St John, marketing gurus like Chris Cardell in Britain, and even NLP experts like Tony Robbins, have studied the mindset and behaviors required to become a HNWI. The following are six characteristics that Chris Cardell consistently finds in nearly all HNWI.

1. HNWI do not have a fixed pie perspective of money (Fixed pie means if one person gets more money, someone else gets proportionately less).

2. HNWI really enjoy their work, which provides them with a keen sense of satisfaction from even the slightest accomplishment. (The journey of a thousand miles begins with one step.)

3. HNWI mastered budgeting their money before they became wealthy. HNWI take responsibility for the amount of money they do or do not have. (Wasteful with a little, wasteful with a lot.)

4. HNWI perceive their wealth as a reflection of the value that they bring to the marketplace. (If they want more, they give more value to more people.)

5. Nearly all HNWI experience a sense of purposefulness, or fulfillment, when pursuing their chosen entrepreneurial path. Consequently, they really believe that entrepreneurship is the most rewarding path to freedom from money constraints. (One definition of success is “To become a person who is able to do, and have, what they want, when they want it.” Mother Teresa had very little personal money, yet most HNWI would consider her a successful entrepreneur, and a sterling example of creating something using personal purposefulness.

6. Accumulating high net worth is a science that has be studied extensively, and an art that can be learned and mastered. Virtually every HNWI in every study expressed appreciation to one or more mentors who coached them (in person or through books). (Here’s an example of the results of decades of study. www.symbiosis4u.us/Temp/TFPPW.html You can download the MP3 or watch the video.)

I would add one more quality to Chris’ list: persistence. My current mentor (whom I have not equaled yet) gave me the phrase “I will until I did.” I like the way Samantha Bennett expressed it.

IN PRAISE OF THE CAPABLE

And as you stand there
On time and
Appropriately clad for the event
With a high-fiber bar in your bag
And extra pens
Let us take this moment to applaud you.

You, the prepared.
You, the accomplished.
You, the bills-paid-on-time and the-taxes-done-in-March.

You, who always returns the shopping cart.
You, who never throws a tantrum.

While the moody, the irresponsible, the near-hysterical and the rude seem to get
All the attention
Let us now praise you.

Just because everyone always expects you
To do well
Does not make it any less remarkable
That you always do so well.

So thank you.

For picking up the slack
For not imposing
For being so kind
And mannerly
And attending to all those pesky details.

Thank you for your consideration
Your generosity
For always remembering and never forgetting:

That a job well done is its own reward
That the opportunity to help someone else is a gift
That the complainers, the cry-babies, the drama queens, the never-use-a-turn-signals, the forgetful, the self-involved, the choleric, the phlegmatic and the your-rules-don't-apply-to-me-types

Need you to rebel against in order to look like rebels.

(You provide the lines - for without the lines, what would they color outside of?)

So take a minute
To pat yourself on the back
And say, "Job well done."
And as you consider someday
Showing up stoned
Or unprepared
Or not at all

And as you imagine someday being imperious
Or demanding
Or the one with the temper

Hear the unspoken "thank you" from a
Grateful nation that is a
Better, smarter, calmer, easier, friendlier and more organized place
Thanks to you
And your dogged diligence.

You are beautiful.
You are precious to us.

You are the hand that calms the water, the wheel that never squeaks, the one we all rely on
And while you probably would have remembered to send a thank-you note,
We forgot.

And just because everyone always expects you
To do well
Does not make it any less remarkable
That you always do so well.

And I would tell you to take the afternoon for yourself
Or sleep in tomorrow
But I'm pretty sure you already have plans.

So just take this very moment right now
To appreciate you
And all that you have done and done well
Even by your own high standards.

And remember:
You are beautiful.

And just because everyone always expects you to
Do well
Does not make it any less amazing, delightful or delicious that

You always do so well.

© Samantha Bennett 2009 http://theorganizedartistcompany.com/

Pennies On The Railroad Track

My dad worked for the railroad, so we lived in railroad towns. As most kids who lived in railroad towns, we all knew the effect that a speeding locomotive had on a penny that was left on the tracks. The penny would be flattened paper thin while the engineer driving the locomotive had no idea he had just distorted Abraham Lincoln’s head.


While one penny set on a railroad track would have no effect on the speed of a train, a few million pennies would. With that thought in mind, read the following, sent to me by a business associate with a very unusual grandmother. (Note: I added links to clarify some things he wrote.)


Hi Tom,
I was in Lowes the other day to pick up a new faucet for the kitchen sink. Since I was there anyway, I thought I would look at the attachments for garden hoses. They were all made in China.

The next day I was in Ace Hardware to pick up some pipe sealant (which I forgot while at Lowes) and just for the heck of it I checked the hose attachments there. They were made in USA .

Which made me start thinking, and probably explains why I was so impressed with my 84 year old grandmother’s email. Here’s what she wrote.

“My great grandson likes Hershey's candy. I noticed, though, that it is marked “Made in Mexico” now. I do not buy it any more.
“My favorite toothpaste Colgate is made in Mexico ... so I have
switched to Crest. It’s getting to where I have to read the labels on everything.

“Why just this past weekend I was at Kroger. I had a small shopping list (don’t need a lot at my age) which included 60 W light bulbs and Bounce dryer sheets. I was in the light bulb aisle, and right next to the GE brand, which I normally buy, was an off-brand labeled "Everyday Value."

“I picked up both packages of bulbs, put on my fine print reading glasses, and compared the labels. They appeared the same except for the price. The GE bulbs were more money than the Everyday Value brand, which I would expect for an American company like GE. But then I got a real surprise. The GE light bulbs were made in MEXICO and the Everyday Value brand was made in - get ready for this - in Cleveland, Ohio, in the good ole USA.

“So on to another aisle - Bounce Dryer Sheets. Yep, you guessed it, bounce cost more money and is made in Canada. The Everyday Value brand was less money and MADE IN THE USA!
“I was tired after shopping, but I did one load of laundry anyway (it is true that old people don’t have the stamina we used to … but we do have fond memories of when we could …). The USA made dryer sheets performed just like the Canadian Bounce I have been using for years and at almost half the price!

“I learned something that day. (Anybody who tells you that you can’t teach an old dog new tricks, has never been old.) I had to discard the myth that American products I used for years … are still being made in America. Yet, equally good products are still being made in America. However, you have to read the labels.

“Here’s a challenge to my five children, fourteen grandchildren, and three great grand children. Start reading the labels when you shop for everyday things and see if you can find some that are made in the USA - the job you save may be your own or your neighbors!

“As for me, I am embarrassed because I should have started doing this decades ago. But, even at 84 and living on a fixed income, it is not too late to help our fellow Americans keep their jobs and create more jobs here in the good ole USA.”

Apparently this Texas acorn (me) did not fall far from the ancestral Oak tree (my grandmother) because I have been financially supporting American workers for nearly two decades by buying almost all my household “stuff” from one American based manufacturing and distribution company. The fifty year old company has over 21 Private Label brands, making up over 450+ consumable products, covering most of my daily needs, all in one place, on line, with cost effective shipping charges (free with orders of $75 or more).

And, as if that were not enough, they are also the only American company to receive the coveted United Nations Environmental Award. This is one American company that has never put profit ahead of the environment or ethics. (In the past decade, at least twenty distributors, each with a six figure income, have been expelled for questionable ethics.)

Not only am I buying quality products made in American, but I have also been creating a small supplementary income stream for myself (as a financial planner, I encourage my clients to create an assortment of income streams). Like thousands of other hard working Americans who have discovered what every store owner has always known: repetitive consumption creates repetitive income. (http://gr8team-tnt.info/TNT/Residual.htm )

Just out of curiosity, how much of your disposable income (what is left after paying taxes, housing, and transportation) did you spent on “repetitive consumption” last year, causing a secondary income stream for someone else?

According to the last census, the average American household has $750 a month, or $9,000 a year, of disposable income. Suppose the average family could get back just 10% of the money they spend, would $900 be of any benefit to anyone you know?
( http://symbiosis4u.us/Info/Basics.htm )

Because numbers are important to a financial planner like me, I have to clarify that the average family who shops were I shop, only spends between $300 and $400 a month on selective quality products. Last year, the average family received an average secondary income stream of $1,380, which is actually closer to a 25% return of the money they spent.

Unlike most American companies who only share profits with stock holders (if the company even makes a profit), for five decades this company has been sharing their profits with those of us that shop and share the concept! Last year, this fifty year old company showed a 15% increase in sales … in the midst of a recession ( http://gr8team-tnt.info/TNT/AGnews.htm ). Makes one wonder if our penny wise and dollar foolish shopping habits could be a factor in sustaining the recession?

I close with this thought. “A true friend is someone who reaches for your hand and touches your heart.”

See you soon,
Michael

If the economy is like a powerful locomotive speeding down the railroad tracks toward some indistinct future, and my buying power is like a penny on the tracks, then my penny will not have any effect on that speeding train.

However, if the fifty million Americans who are currently unemployed, or under employed, or struggling to recover from a bout with unemployment … if just those fifty million Americans would place their pennies on the tracks … it just might be enough to slow down the train … at least until the other two hundred and fifty million Americans realize how valuable their pennies are. Like pennies on a railroad track, we can choose to support America, one penny at a time.

Next time you reach in your pocket for a penny, may the penny remind you to be one of the new breed of Americans who evaluates both the “out of pocket” pennies AND “out of country” production. When counting pennies, remember to financially choose you, your family and friends, at the same time!

Can our nation’s economy be revived … One Penny At A Time … around such mundane things as: Tooth Paste, Cookies, Detergents, Lipstick, Coffee, Peanut Butter, or Whatever… with a penny from one American … paid to another American … for a quality product … made with pride … in America.

If so, then you will say, like Paul Harvey said for years, “Now you know the rest of the story.” http://gr8team-tnt.info/TNT/PaulHarvey.htm

Four Boons Of The Marketplace

A few years ago, the AARP asked some attorneys if they would offer basic services to needy retirees at $30 an hour. Everyone of them said “NO, NO, NO!”
But then the AARP had a brilliant idea: They asked the same lawyers if they would offer their services to needy retirees for free. Overwhelmingly, they said yes.
How could $00 per hour be more attractive than $30 an hour?

The original offer seemed insulting, a request for legal services at below-market wages. But when the request was reframed as volunteer work -- and therefore meaningful -- most were happy to oblige … because they enjoyed their work. Those who said “No,” the second time, probably looked at their work in terms of money, with a minimal sense of satisfaction or enjoyment.

The lawyers who said “NO” had not learned that whatever you do for a living should be a natural outlet for your energy and enthusiasm. What could be more copacetic than to love what you do and feel that it matters? Connie Podesta only needed two minutes to explain the concept. www.symbiosis4u.us/MP3/Podesta-2Questions.htm

Look around you. You'll probably find that the happiest, most engaged individuals are those who are deeply involved in their work, passionate about their community service (or both), even if their time is unpaid.

Why is that true?

Have you ever heard the concept: The highest reward for your work is not what you get, but who you become. Watch Jim Rohn explain this concept in five minutes. www.symbiosis4u.us/Temp/JimRohn-MarketplaceValue.htm

“Hogwash,” you say, “give me the money!”

Well … if earning money is the sole purpose for work … then you may be using the dictionary’s second definition of the marketplace.

mar•ket•place  [mahr-kit-pleys] –noun
1. an open area in a town where a market is held.
2. the commercial world; the realm of business, trade, and economics.
3. any sphere considered as a place where ideas, thoughts, artistic creations, etc., compete for recognition.

However, there are three definitions of the word “marketplace.” The third definition does not use any terms for money, and refers to rewards other than money. By combining the second and third definitions, you discover there are …

Four Boons From The Marketplace

1. The Boon of Financial Freedom
Wages, salaries, and commissions yield paychecks. For most Americans, the marketplace is simply a source for paychecks. Earning a living, which is trading time/skill for money, is the most well known boon of the marketplace. If you were born and raised in America, you think of the marketplace primarily in terms of a paycheck for services rendered, not the vehicle which made America the Land of Opportunity. Listen to Nido Qubein explain why Foreign born Americans think differently. http://www.symbiosis4u.us/Temp/NidoQubein.htm

Ben Franklin, the kite flying author and statesman from Colonial Days, once said “There can be no freedom, of any kind, without financial freedom.” Now, I don’t think Ben defined financial freedom as extreme wealth … like diamond lane commuting to work in a chauffeured Rolls Royce … in order to have any other kinds of freedom.

No, I think Ben Franklin defined financial freedom in terms of having the ability to put food in your tummy, a roof over your head, a fire in your hearth, and … a warm winter coat would be nice during a white Philadelphia Christmas.

However, because humans have a natural propensity to want more (greed), there is a dark side to the Boon of Financial Freedom.

Beware of “FINANCIAL FREEDOM HYPE” in the marketplace.

Hype appeals to a person’s imagination, triggered by a perceived pleasure or benefit. Perceived pleasures such as: not having to look at the price tag on the sleeve of the silk suit, or the sticker attached to the window of the new car, or writing one check to pay for your dream home. Imagine taking your wife on a Caribbean vacation … in your own private jet … to your own private Caribbean island (Richard Branson did). Such pleasures really do exist … in rarified air, indeed.

Do some people really achieve those levels of financial freedom? Of course … but only after they provided an equal or greater value to the marketplace (Richard Branson did). In the meantime, if something sounds too good to be true, it probably is … but not always. Sometimes an unexpected shift in the marketplace results in unexpected opportunity. The winds of change frequently precede the windfalls of financial freedom. When considering something new, or something old that is changing, do your due diligence … particularly to market share and corporate longevity. The marketplace may grind out the truth slowly, but it grinds very fine, and rarely forgives purposeful deception.

2. The Boon Of Inner Freedom
The freedom to be yourself and share what you know and love with the world. Les Brown, the famous motivational speaker, once made the comment, “The two most important days in your life are: the day you are born, and the day you realize WHY you were born.”

Have you ever asked yourself why were you born to your parents, in your locale, with your language, and your cultural precepts? What is the purpose for your unique finger print? What is the imprint you are to leave on this world? How about taking a simple Imagineering exercise?

Suppose you were given a six months sabbatical from work. You would receive full pay to cover your ongoing living expenses like mortgage, car payments, insurance, etc. You would also receive an additional full paycheck to cover your sabbatical expenses.

Now, think about this … really think about this …

What would you do? ______________
Where would you go? _______________
Who would go with you? _______________
What would you learn? _______________
Who would you want to meet? _________________
How soon would you start your great adventure? ______________
What significant act of human kindness would you bestow? ________
What legacy would you leave for future generations? ______________

Would you return from that sabbatical, the same person who left?

If you are like most people, you won’t answer any of those questions.

Because … you know it will never happen.
Because … you don’t know anyone for whom it has happened.
Because … you don’t have the time to even consider such frivolity.
Because … you may fail.
Because … fill in the blank ________________.

Few people ever find out why they were born because the demands of earning a living takes all their time and energy (the first Boon of the Marketplace). They miss the Marketplace Boon of Inner Freedom unless … they find a job with a company that encourages them to “be all that you can be” and … gives them six month with double pay to discover “all that they can be.”

3. The Boon Of Location Freedom
Prior to the abolition of slavery 150 years ago, the overt difference between a slave and a free man was the ability to leave one place and go to another … without anyone’s permission. A slave and a free man might both work as farmers, tilling similar fields, live in similar housing, eat similar food, and utter profanities at similar mules … except … when a drought came … or locusts ate the crop … the free man could go where the opportunity for a better life was … better. The slave could not. The free man could exercise the Marketplace Boon of Location Freedom. The slave could not.

When I ask people the “Sabbatical Question” above, about 80% define a desire for some kind of travel or adventure. Their faces glow when describing walking through the vineyards of Tuscany, getting lost in the Louvre, feeding the poor in Calcutta, climbing to base camp at Mount Everest, hot air ballooning over the Serengeti, or … quite rarely … simply waking in the morning without an alarm clock and commuting twenty feet to work while sipping that first cup of marvelous coffee … the Marketplace Boon of Location Freedom includes working from home.

I have enjoyed the Boon of Location Freedom for five years. Don’t ask me to give up my twenty foot commute … unless I can take my camper out in the wilderness and work sitting atop a boulder with all of creation stretched out before my wondering eyes.

There’s an aspect of Location Freedom you may not like. Every day, millions of people get up in the morning and leave their homes where they have … a computer and a telephone. Then they drive to work where they have … a computer and a telephone. On September 11th, 2001 … some of them did not come home. Does that put Location Freedom into perspective?

4. The Boon Of Time Freedom
Time is an unusual Boon, and probably the most difficult Boon to acquire. To me, the ultimate expression of the Time Freedom boon is … no alarm clock. I wanted, and really enjoy Time Freedom by sleeping until I wake up. In contrast, my mother-in-law did not want Time Freedom … at first.

My mother-in-law worked as a school teacher for forty five years. She wasn’t eager to quit working because she did not know what to do with her day if she was not going to work. She finally retired because her retirement income exceeded her employment income. She would lose money by continuing to work.

After she had been retired six months, I asked her if she was bored with retirement. Her answer, “My life is so busy that I don’t know how I ever found time to go to work.” She embellished that comment with, “Hours in life are like closets in a home. It doesn’t matter how many empty hours or how many empty closets you have … something will fill them.”

So the Boon of Time Freedom is not about having nothing to do. It has everything to do with the OPTION of having nothing to do.

As you review each of the boons, you discover each of the four Boons of the Marketplace gives you … options. Based on my fifty years experience in the marketplace, the first thing you need in order to enjoy more options is ... more sources of income. If you only have a job, with no secondary income stream, you have no options ... even if you own the business ... as I did.

To learn about options, ask to attend a webinar or conference call. Just pop me an email and I will send you details. tomv@symbiosis4u.us Then it is up to you to determine if what you learn is what the marketplace wants. If the marketplace does not want what you have to offer, well ... that's why unemployment lines exist.

Have a great day in the marketplace, I will.

But, but, but .. is crippling our economy.

Suppose we were sitting down at Startled Bucks having a cup of coffee. Between sips of coffee, imagine I casually ask, “Would your life would be easier if you had two streams of income: a primary income from your current work and a secondary income from a part time business of your choosing?” You would probably answer “YES.”

And … if you are like most people … following that clear “YES” would be a litany of handicaps, any one of which would cripple a potential secondary income stream:

BUT … I don’t have time.

BUT … I don’t know how.

BUT … I don’t have the money.

But … But … But … is crippling our economy.

Why?

Because of a thing called the "velocity of money."

“Velocity of money” represents how much money is in circulation and how fast it circulates. The more money and the faster it moves … the stronger the economy.


For example, businesses circulate money by spending money to make money, then they spend more money to make more money. The more money they make, and the more money they spend, the higher the velocity of their money. (Much of the money circulating is employee income. However, employee income is not spent in order to create more income … except for some part time business owners who buy products for their personal use from their own businesses.)

Many of these “velocity of money” producing businesses are part time businesses … without employees. In fact, as much as 25% of the nation’s Gross Domestic Product, which is one measurement of the velocity of money, is produced by businesses without employees.

Part time businesses without employees
are the most economical to fund,
the fastest to start,
and the easiest to operate.

Hence, the key to economic recovery begins with part time no-employee businesses … started before the end of ...(now)?

Millions of dollars can be produced and spent by these small businesses. Those millions, though small compared to the GDP, could create a “velocity of money” in homes across America. The “velocity of money” at the household level has the potential of igniting the velocity of money at the corporate levels.

But, but, but, but …

I know, I know, half of Americans think they are too broke to do anything, and the other half are afraid to spend what little money they do have. In such an adverse climate, how could thousands of new small businesses get started?

Easily, because …

Uncle Sam pays for the start-up costs and the ongoing operating costs. It's called an "Ethical Bribe," and here's how it works…
Three steps can stimulate the economy.
1) You intend to start and run a part time no-employees business (2 to 10 hours a week).
2) You intend to ultimately make a profit (few businesses make a profit in the first couple of years).
3) You intend to keep simplified business records. (I run my part time home based business using a Visa card and Outlook Calendar. The Visa card automatically records and itemizes my business expenses and Outlook calendar documents my business activity.)

To paraphrase any knowledgeable tax attorney or CPA, If you start a no-employees business with the intent to make a profit (IRS code simply says “make a profit,” not how much profit), the IRS will cut your taxes by $2,000 or more every year, starting RIGHT NOW. (Email me and ask for a free copy of the NFIB home business tax reduction check list so you can get an idea of the variety of tax advantages available for a home based business.)

Caveat: No business, or any kind, should be started just to reduce taxes. That is tax evasion. However, it is completely legal to start a business and use the good tax laws to assist your fledgling business. Sanford Botkin, and other tax attorneys, create tax training programs about specific IRS laws … laws which can be confirmed by reading them at www.irs.gov . To my knowledge, ALL of the tax code is available online. The challenge is finding the right code, which is why we need the experts like Sanford Botkin.

Furthermore, if you are an employee, the IRS will let you collect part of your additional Tax Refund every couple of weeks, all year long – you do NOT have to wait until April 15 of next year.

HOW DOES THAT WORK?

Simply ask, and I send you a one page business expense tax deduction guide from the National Federation Of Independent Businesses (NFIB), plus a one page check list of items most home based businesses deduct as business expenses (employees don’t pay taxes on money that is invested to start or run their own part time no-employees business). After you get your copy of the check list, notice that most of the items on the list are also items that employees already have (cars, cell phones, computers, DSL, etc).

Note: Your privacy is required by law and my personal ethics. After you print a copy of the document I send, you then fill in the check list with a pen or pencil from the privacy of your home. I have no way of knowing what you put on your personal list. That list is for your eyes only. After filling in the blanks, add up all of your personal use items that can be converted to business expenses. If the total is greater than $2,000 a year, then we should schedule some time to discuss how to increase the velocity of your money.

If your annual estimated tax deductions from the check list exceed the average cost of running a home based business, then your first supplementary income stream will be subsidized by the IRS … to the tune of thousands of dollars (there really are good tax laws).

Example: A fifty year old home based business (1 of the 4 which I recommend) averages less than $100 a month to operate so if your estimated tax deductions are $6,000 a year, then a part time business (2 to 10 hours a week) puts $4,800 spendable cash in your pocket.

WHAT ARE THE 7 BIGGEST TAX BREAKS?
Out of the hundreds of business tax advantages passed by congress, and part of the IRS code, for home-based businesses, here are the TOP SEVEN:
1. Home Office Deduction (this even lets you write-off your RENT!)
2. Business-Use of Personal Vehicles (this may be your BIGGEST deduction)
3. ALL out-of-pocket Health and Medical Costs (for the whole family!)
4. Hiring your own Children (as young as 7 years old, up to $5,700/child!)
5. Combining Business with Pleasure while on Trips (vacations just became deductible!)
6. Meals and Entertainment (this deduction is bigger than ever, and totally safe!)
7. Depreciating home furniture & furnishings used part-time for business.

After totaling your anticipated tax advantages, and picking out a home based business (I recommend only about four out of a possible 1,500), you can visit your payroll office to fill out a short form called a W-4. For each $4,000 of potential business tax deductions, you can increase your exemptions on the W-4 by one exemption. Each exemption puts an extra $300 per month in your take home pay – beginning with your very next paycheck!!!

That's like putting $75 extra cash in your pocket every week – week after week after week! That's just from tax savings not even counting the secondary income stream that will result from running a part time no-employees business with the intent to make a profit!

Note: a home based no-employees business is not designed to create wealth, just a nice secondary income stream for a minimal amount of work. If you want to get wealthy without any work, may I remind you of a statement attributed to Leonardo de Vinci, “He who would be rich in a day, will be hung in a year.”

Carefully choose the company from which you will create your secondary income stream. As of today, an aggregate of about 1,500 companies offer low cost start up businesses. Within five years, 1,450 of the current aggregate will be out of business either because they are underfunded or do not have a “purple cow” product.

May I suggest you consider the oldest direct sales business (50 years old) with the oldest product supplier (150 years old). Longevity is a pretty good indicator that a company is running the right business, with the right products, in the right way. If you would like to know more about this most venerable company, just ask … I think you will be pleasantly surprised. I know I was.

Remember: Small Business has always been the backbone of the American economy, so it is the rapid expansion potential of Small Home Businesses that has the greatest potential to return America to Growth and Prosperity.

From a semi-retired business man’s perspective, the next two years will be fascinating.

Kitty Hawk and the Internet

Most grammar school kids know the story of Orville and Wilbur Wright … the first human beings to fly in a motorized machine. But did they ever heard about Dr. Samuel Langley?

In 1896 the Wright Brothers, and Dr. Langley were engaged in a fierce competition to see who would be first to conquer the skies. Langley was favored.

Langley was a distinguished scholar and secretary of the Smithsonian Institute. He had already achieved an impressive unmanned flight using a steam powered engine launched from atop a houseboat in the Potomac River. Langley had raised $100,000 in funding with which to build an extraordinary radial-cylinder internal combustion engine that would produce an astonishing 52 horsepower … powerful enough for manned flight.

The Wright Brothers, by contrast were un-credentialed tinkerers, confident that the secret to success lay in their ability to control the aircraft … once they got it in flight. They practiced with inexpensive gliders. The brothers suffered a multitude of minor cuts and bruises following each attempt at flight. But each successive crash brought the two brothers closer to aerial finesse by using the prevailing winds, rather than creating a wind with rapid motorized acceleration.

Then, on October 7, 1903, it looked like the brother's had lost. Langley's plane, which could go from a dead stop to the 60 mph flying speed in only 70 feet, began its first flight with a man at the controls. The forces from the intense acceleration ripped off a wing in very first attempt to take off.

Two months later, Langley had rebuilt the plane (with the last of his investment capital). On December 9, 1903, during the second attempt at launch, the acceleration forces collapsed a wing and the tail, which brought the ill-fated flight to a dramatic end at the bottom of the Potomac River.


Just days after Langley's spectacular failure, a sturdy, well designed craft, powered by a tiny eight horse power engine, costing about $1,000, struggled into the air at Kitty Hawk, defining for all time the moment when humankind … became masters of the skies.

Were the Wright Brothers just “lucky?” Listen to Jim Collins define luck and then make up your own mind. www.symbiosis4u.us/Podcasts/WhatAboutLuck.mp3

In the early 1900’s, America exploded with creative energy and vitality … because early entrepreneurs had thrown the first set of doors wide open … to explosive growth.

In 1994 (when the internet was opened up to commerce), the second set of doors to explosive growth were flung wide open. Those doors to explosive growth are even more wide open now than they were in 1994 … as it were 1903 again and man is testing a new set of wings. But this time, the little guy tip toeing through those wide open doors, is not flying solo. The little guy, ready to fly through those doors, is 300 million strong. The little guy is the American consumer.

The first time that idea crossed my desktop, it was an outlandish concept … until I looked through the doors that are flung wide open. Stay with me while we take a peek through those wide open doors at the changes in our economic system (all economic systems include manufacturers, distributors, and consumers). See for yourself whether this outlandish concept becomes somewhat rational? Here come the numbers!

According to economist Paul Zane Pilzers’ book Unlimited Wealth, when the Wright Brothers caught air at Kitty Hawk in 1903, for every $100 they spent as consumers, the manufacturer would get $80, while $20 went to distribution (getting the product from the manufacturer to the consumer). The manufacturing entrepreneur’s mantra was, and still is, “build a better mouse trap and the world will beat a path to your door.” Listen to a 1 minute commentary by Paul Pilzer on the “Good Old Days”. www.symbiosis4u.us/MP3/PilzerChange121.mp3

By the 1950’s, industrial technology had improved manufacturing so 50% of the consumer dollar went to the manufacturer and 50% to the distribution system. With 50% of the consumer dollar, stores sprouted up like mushrooms in Alice’s Wonderland. The mantra of retail outlets became, and still is, “location, location, location.”

By the second millennium, the distribution system had expanded to give the consumer greater convenience (3 Safeway stores are within one mile of my home), while manufacturing had contracted (gone offshore). In our modern world, 20% (or less) of the consumer dollar goes to the manufacturer. 80% of the consumer dollar is spent on getting the product from the manufacturer to the consumer.

We have shifted back to a 1903 economic base … IN REVERSE.

The Wright Brothers, Henry Ford, Thomas Edison, Issac Singer, and others made their fortunes by focusing on manufacturing. I wonder why none of these men focused on distribution? Was it that “movers” (distribution) received only 20% of every consumer dollar, while “makers” (manufacturers) received 80%?

If the great entrepreneurs of the past century were alive today, do you think they would go into manufacturing? Or would they see that the internet allows manufacturers to sell direct to consumers (the beginning of the end for the majority of brick and mortar retailers). Do you think those early entrepreneurs would focus on ways to “build a better mouse trap” or eliminate the dependence on “location, location, location?”

The early entrepreneurs went where the money was … then. They would still go where the money is … now … not where it had been.

Why? Because the money is in distribution now. Crunch these numbers.

Our current Gross Domestic Product (GDP) is $14 Trillion. 28% of that money is government spending (new stats aren’t out for Obama yet). 22% of GDP money is corporate spending. That leaves 50% ($7 Trillion) as consumer spending. 80% of that $7 Trillion is the price our distribution system extracts from consumers in order to move products from the manufacturer to the consumer. 80% of $7 Trillion is $5.6 Trillion. $5.6 Trillion is a very wide open door.

If you spend $1,000 a month in stores. Only $200 is the actual cost to make whatever it was that you bought. You are paying $800 for convenience. How much convenience will you give up in order to get most of that $800 back?

If manufacturers’ mantra is “build a better mouse trap,” and distributions’ mantra is “location, location, location,” what is the new mantra? Michael Dell identified it in 1999 when he addressed the Economics Club of Detroit. The new mantra is “community, community, community.” More on that in a future newsletter.

Here’s the Million Dollar Questions for you to ponder. When manufacturers sell direct to consumers … who gets the $5.6 Trillion that had been trapped by the distribution system? How will you gain access to that money? Watch this eight minute video to consider one possibility. www.symbiosis4u.us/Special/HouseGold.htm
The next decade will be fascinating.

Beware the coming TAX tsunami.

Mid April, 2010

Thought this might be of value to you.

Last week the House Ways and Means Committee released the list of the $670.341 billion in tax increases that have already been signed into law, equating to a staggering $2,100 per year in additional federal taxes for every man, woman, and child in America.




Here is a link to the complete list of taxes that have already been signed into law. Courtesy of Congressman John Carter from Round Rock, Texas.

Yesterday I received an email from a friend, financial planner, and small business owner he studies trends in order to counsel his clients on legal and ethical means for increasing cash flow and reducing taxes.

Here’s what he wrote:

“As a licensed financial planner for 24 years (during which I also built 3 successful businesses which I run from home. I know you do a lot better financially when you pay less taxes. The new tax increases will definitely reduce the financial resources of your family, and by default, the country as a whole.


"In spite of your soon to shrink paycheck due to tax increases, I know that you can increase your spendable income by making more money while simultaneously reducing your tax burden. I have been doing this, and helping others do the same, for 24 years.

"To implement better revenue and tax strategies in your home, you need to know about the three trends that impact every employee and small business owner: the rapid growth of the internet, which produces both changes in distribution, and changes in franchising. The combination of these three trends will be the biggest change in business since the invention of the internal combustion engine. And, unlike the cost of an internal combustion engine, tapping into these three trends can be implemented for about the price of a few tanks of gas.

"If you were my financial planning client, I use the following rule of thumb which is based on the Rule Of 72 (Google this rule to learn more). The typical middle income family in the USA (about $50,000 of household income) can anticipate from $3,000 to $6,000 of additional spendable income, in the first full year, from the combination of increased income and reduced taxes … which should compensate for any loss of buying power due to the new tax increases."
Be Healthy & Prosper,
M. Johnson



Here’s what to do next:

For a mere 45 minutes, on most Mondays, beginning at 7:30 pm, you can get a unique overview (with a different speaker every week), of what many small business owners are calling … “The biggest change in business since the invention of the internal combustion engine.”

Go to www.importantlink.com and get your login number for the next weekly webinar, or write down the conference call telephone number if you just want to listen autonomously.

Nothing is for sale.

If you wish, you can register for the webinar using your own name … or even the name of your favorite IRS agent.

Note: webinars provide a basic overview based on the experience of the speaker. A specific webinar cannot answer all your questions because every household is different. However, after a few weeks, you will have learned a variety of ways from which you can pick and choose,one or more means to increase your family’s lifestyle.

Worst case scenario is comparable to buying a membership to Costco and then not go shopping at Costco.

Why people rob banks.

On October 12, 2006, a 20-year-old woman entered a bank in Washington, D.C. She patiently waited her turn in line and then stepped up to the next available teller window. While she calmly spoke on her cell phone, she persuaded the teller into giving her $14,000 in cold, hard cash.

She believed thathaving the cold, hard cash in her hand made it HER money. Her beliefs about money would have prevented her from understanding what Leonardo Di Vinci meant when he said, “A man who would be rich in a day, will be hung in a year.”

Shortly after her capture, the woman reportedly gave a tearful apology to the bank teller she robbed, but that didn't stop her from being sentenced to twelve years in prison for her crime.

Think about it. Can you fathom working twelve years to earn $14,000.00, which is slightly more than $100.00 a month? Robbing banks is obviously not an efficient way to earn a living. Since that is true, then why do criminals continue to rob banks?

Because they believe that's where the money is … and if they can grab the money, the money will be theirs.
That may have been true a century ago. But banks are not where the money is now.

So where is the money now?

Paul Pilzer PhD, economic advisor to two presidential cabinets, multi-millionaire, and best selling author of many books, commented in his book “Unlimited Wealth” that our nation has a gross domestic product (all the money earned in the nation) of about $14 Trillion. About 60% of that $14 Trillion is the result of “casual” consumer spending (what is left after paying income taxes and housing), which is about $8.4 Trillion. Since $8.4 Trillion of “casual” consumer dollar goes through the distribution system (getting “stuff” to where the consumer can buy it), and the distribution system’s inefficiency takes 80% of the consumers “casual” money, then about $6.5 Trillion are being siphoned off through the distribution system.

$6.5 Trillion is a lot of money, isn’t it. Can you even imagine that much money? I can’t.

And here’s the really weird part. Bank robbers don’t even attempt to rob this money. They can’t because the money is not just “sitting in piles” in a bank vault. The money is more like a fast moving river of money. Distribution money is not static, it is dynamic.

Distribution money never stays in the same place, it keeps moving. Distribution system money is like a river … you can never step into the same water twice.

Perhaps that explains why criminals rob banks instead of the distribution system. Banks have a pile of money that can be picked up and moved. Distribution money can only be re-directed, much like a river can be redirected by digging irrigation ditches which channel the water to where the water can cause things to grow.

Since distribution money is “cash flow”, not the cold, hard cash that bank robbers like, a person, who wants to grow financially, could ask themselves …

How can a person create some “cash flow” from distribution money?

If you think back to my previous newsletter, I explained that the internet positions manufacturers to sell directly to the consumer. This has never been possible on a large scale at any time in history. Consequently, the distribution system, as we know it, will experience a dramatic change in the next decade.

Per Paul Pilzer’s book “The Next Millionaires”, our anachronistic distribution system is going to become the source of the money for the greatest re-distribution of wealth this nation has ever seen. Dr. Pilzer actually projects that the re-directed flow of distribution money will create ten million new millionaires in the next ten years. That’s 2,740 people a DAY, EVERY DAY, FOR TEN YEARS becoming millionaires. (Drop me an email and ask for Pilzer's ten million millionaires audio.)

Dr. Pilzer’s concepts require some explanation.

For over one hundred years, our distribution system has minimally consisted of manufacturers, regional wholesalers, area wholesalers, retail outlets, and consumers.

In 1962, Sam Walton, founder of Wal-Mart, looked at this distribution system and thought, “If I can just eliminate one of those links in the distribution chain, I will be able to reduce costs to my customers.” The rest is history. Last year, Wal-Mart did $350 Billion in sales from a highly diversified product line.

In 1984, while still a college student living in a dormitory, Michael Dell, founder of Dell Computers, looked at the bloated distribution system and asked, “What if I could eliminate ALL of the distribution system and sell direct to the consumer?” Twenty years later, Michael Dell had a personal net worth of about $15 Billion from selling just computers and peripherals.

In 2000, Michael Dell spoke at the Detroit Economics Club. In his famous “Three Cs” speech, he said that any business has to have three components to be successful: content, commerce, and community.

Content refers to a product or a service which is intended to be sold. Content can be anything: an e-book, some music, a new car, a house, or a pair of shoes.

Commerce is the ability to receive payment for the product or service and get the product or service to the customer. Commerce can be driving to the local Shopping Mall in your car or clicking on Pay Pal at EBay with shipping via UPS.

Community is a group of people who want to buy the product or service. According to Michael Dell, between “community”, “content”, and “commerce” … community is the most difficult to create … especially online. There is very little loyalty online.

A brick and mortar store services the “community” of people who live within five miles of the store. The three most important elements for a conventional store are “location, location, location.”

The internet has NO LOCATION. A person will “switch” location from San Jose to Florida with a twitch of their index finger. The three most important elements for internet stores are “community, community, community”.

Suppose a store near your home offers a “widget” for $100.00. A store ten miles away offers the same “widget” for $95.00. Would you drive twenty miles, round trip, to save $5.00? Probably not.

If you were shopping for the same “widget” online and found one in California for $100.00 with free shipping, and also one in Florida for $95.00 with free shipping, which would you choose? Probably the one from Florida.

This shift in shopping attitude is causing a crack in the nation’s anachronistic distribution system. That crack is like a small fracture in a dam that holds back a large river … a large river of money … $6.5 trillion of distribution money.

Distribution money is beginning to leak out of that crack faster and faster every day. We are witnessing the early stages of the re-distribution of $6.5 trillion by those who are capturing the early trickles with buckets while digging ditches to re-direct the steadily increasing flow of all that money … into their own lives and the lives of people who understand and take action.

My company teaches people how to capture distribution money with a cup, then a bucket, and then digging ditches to capture an even greater flow. Of course, we don’t call it “digging ditches”, we call it building communities … communities of shoppers.

To build communities, we use a new business model (FTC approved) called “team building”. Team building is what Michael Dell referred to as “building a community”. Team building is organizing individuals, and small groups, into co-ops of consumers … which compound their buying power.

One consumer can easily catch a cup full of distribution money every month.

A co-op of a hundred consumers can catch a few gallons of money every month.

A co-op of a thousand consumers can create a significant stream of money flowing from the distribution system into the bank accounts of those who dug the ditches.

How is it working?

To answer that question, we need some comparisons. For example …

It took Wal-Mart, building brick and mortar stores, 40 YEARS to produce $100 million in sales in one single year.

It took Amazon, selling only online, 4 YEARS to produce $100 million in sales in one single year.

It took a co-op of 500 nation wide stores selling online (for which my company is a registered marketing agent) … 100 DAYS to produce $100 million in sales ... because small companies nation wide (like mine) built communities offline.

Last year this co-op moved over $1 BILLION in sales. Now that is not a lot compared with Wal-Mart’s $350 BILLION in sales. However, the co-op paid out over $300 MILLION to the consumers who created the volume in the first place. Wal-Mart paid out ZERO. http://www.symbiosis4u.us/MP3/ZipNada.mp3

So, what are you thinking?

Perhaps you imagine yourself holding a cup under a leak in the distribution system and filling that cup with your own money? After all, your money created some of the money flowing through the river of distribution system money. Since it is YOUR MONEY that’s in the river of distribution money, and your money that is leaking out of the distribution system, then doesn’t it make sense to make money with your money? We can show you how to do that in a couple of hours.

Perhaps you see yourself with a bucket in each hand, gleefully scooping up bucket after bucket of distribution money. We can teach you how to do that too, but it will take a couple of hours a week for a few months.

An entrepreneurial minded person may easily imagine digging a ditch that overflows with distribution money. However, like most significant achievements, including becoming one of those ten million new millionaires, irrigation ditches filled with money will take time.

A person could be wondering, “How much money does a cup hold?” That depends on who is holding the cup. People have different incomes, buy different things, have different budgets, with different skills, different motivations and ... different sized cups.

For illustration, suppose a person is married with one child and earns the average W-2 income for Silicon Valley of $67,000.00 a year per family. Their cup would probably catch between $4,000.00 to $8,000.00 a year. You can learn more by reading my free mini-e-book http://www.symbiosis4u.us/Newsletter/AccidentalBusiness.pdf

Does that give you an idea of how much distribution money a cup can hold?

Now, here comes the mind boggling part. Sit back in your chair and take your hand off the mouse because this is too good to be true.

Guess how much my company would charge* to teach a person how to fill up a cup with distribution money?

Nothing. Zip. Nada. Squat.

My company was formed as an Information Age business. In the Information Age, information is free. The free information causes changes which produce cash flow. The cash flow causes more free information to flow, which causes more cash flow.

Surely you can imagine a few drops becoming a trickle, then a rivulet, then a small stream, then a small river, then a large river of distribution money … flowing to the vast sea of consumers. And the first step is filling up your own cup.

Got a cup?