Death By Aspirin

Suppose you have a headache, and your pharmacist hands you a bottle of white tablets while saying …

"Do not take this medicine if you have an ulcer, ulcer-like symptoms, bleeding problems, diabetes, gout, or some forms of arthritis. Do not take it if you have asthma or are in the last three months of pregnancy. If you develop heartburn, ringing in the ears, bruises on your skin, a skin rash, wheezing, this may lead to sudden death. If you experience any of these symptoms, stop taking the medicine and get in touch with your doctor immediately."

Those fear inducing statements (particularly “sudden death”) are all appropriate cautions for taking aspirin.

Statistics on aspirin, acetaminophen, and ibuprofen (the three biggest non-prescription NSAIDs) indicate 16,500 people in the United States die each year from taking NSAIDs.  The American Journal of Gastroenterology (2005) 100, 1694–1695; doi:10.1111/j.1572-0241.2005.50565.x

What if each time you opened a bottle of aspirin, the pharmacists voice would come out of the bottle telling you all the terrible things that could happen?  Would aspirin tablets be flushed down the toilet?  Possibly.  It all depends on the expectation of the person taking the aspirin and level of pain being experienced.

The real question is not whether there is a risk in taking aspirin, but do the benefits outweigh the risks?  Risk to benefit ratios, in business as well as medicine, have to be weighed carefully.   

The greater the pain, the greater the willingness to assume more risk in order to get rid of pain … in business and in medicine.  If the pain is moderate, and the risk of “sudden death” is even slight, the pain becomes more tolerable. 

Now, apply the concept of “risk” from medicine to our current economic condition, at the personal and corporate levels (the federal government responds differently to a recession). 

Could withdrawal from economic activity (recession) be a natural occurrence whenever a perceived pain associated with taking a risk appears to be greater than the perceived pain of NOT taking the risk? 

Did the stock market get flushed down the toilet because the risk of buying stock exceeded the risk of not buying stock? 

For the past fifty years, stocks have been sold based NOT on the profitability of the company but on the potential increase (or sudden death) in the perceived value of the stock. Does this mean that we should not buy stock?  No, it simply means that we have to weigh the risks. 

In my opinion, risks are minimized when stock is purchased based on products with good market value supplemented with good business practices resulting in cash flow from dividends (Warren Buffet uses this concept).  That definition is decidedly different than buying stock based on the expectation of selling it at a higher price.   Here’s an audio slide show illustrating why sudden death could happen to the vast majority of stocks. www.symbiosis4u.us and click on the link “Why Stocks Fail.”

If doing nothing is more traumatic than the total potential loss of taking a risk, the risk will invariable be taken.

Did the housing market collapse because the risk of subprime mortgages appeared less when diluted with standard mortgages?  Or, did the wannabe home owner perceive the possibility of a mortgage default to be less risky than the probability of never owning a home?

Until the immediate effect of a recession becomes worse than the risk of applying the corrective action, the corrective action will be ignored.

Conundrum: While in grammar school, my dad asked me, “Why did the chicken cross the road?”  I answered, “To get to the other side.”  While that was a good answer for a grammar school kid, perhaps a better answer would be “Because the risk of crossing the road appeared to be less than the risk of not crossing the road.” 

For the past one hundred years, personal economic risk has been minimized using a specific protocol called …

the formula for success.

“Go to school,

get a good job,

work hard,

save money,

retire in comfort.”

 

The formula for success worked so well that life time employment was both predictable and expected.  IBM even had a no layoff policy.  Once a person was hired at IBM they may have to change location (IBMers say IBM means I’ve Been Moved), but they had a job for life. 

 

Then around 1990, IBM began layoffs.  During the next two decades, millions of other jobs were lost, including high school dropout blue collar workers and white collar executives with PhDs, in a variety of industries. 

 

The formula for success … was failing.

There have been many ideas suggested as replacement:

My think tank came up with this idea http://www.Symbiosis4u.us/FLV/CurrencyOfFuture2.html

My older brother, a retired government employee living in Mexico, proposes “Learn Chinese.”

Tony Robbins suggests, “Model successful people.”

Michael Gerber offers, “Work on your business, not in your business.”

Jim Rohn would probably suggest, “Add more skills to your repertoire.”

While all of these ideas are viable, including the value of learning another language, none of them have been able to replace the old formula for success.

May I suggest a new formula?

 “To be successful, create multiple streams of income, including at least one income from some kind of passive or residual source.”

Allow me to illustrate.

Until I retired, my primary source of income was from my contract manufacturing business.

A second income came from my two patents in archery.

A third income came from dividends.

A fourth income came from everything I purchased to run both my home and my business.

A fifth income came from people buying “stuff,” similar to a Costco Membership with compound profit sharing.

When I retired, I turned the contract manufacturing over to my three sons.  Each developed a different aspect of the business, and all three are making a comfortable living. 

When I retired, I collapsed the archery business due to extensive travel requirements … plus, none of my family members wanted the business.

When I retired, I began receiving maximum level Social Security checks.

Consequently, retirement eliminated two streams of income from conventional business, and gained one through social security.  Even with four streams of income, my income is not what it had been, nor is my income what 95% of people over 65 experience.

According to the Social Security Administration, 30% of our population die before age 65.  95% of people upon reaching age 65 will choose to continue working, be dependent on their children, or try to survive on less than $24K a year.  McDonald’s graying employees have a new motto, “The first and last place you will work.” 

How you might create multiple streams of income depends on your skills, experiences, and risk tolerance.  A variety of ideas are on my websites.

Most people can create a small income stream at minuscule risk with an Accidental Business. www.symbiosis4u.us/Intent2Profit/intent1.htm

You might want to just evaluate the mega-businesses that supply products and services for a secondary income stream www.symbiosis4u.us/Think3/think3.htm  You may be surprised to see companies like Sears, Barnes & Noble, Best Buy, and hundreds more, participating in profit sharing with consumers.

If you are just curious, try be-bopping around this part of my site www.symbiosis4u.us/Info/Benefits.htm

And, make sure you do not fall into this trap.  http://www.symbiosis4u.us/FLV/Ninja.html    

Creating secondary income streams includes some risk … just like taking aspirin for a headache … or crossing the street.  You have to evaluate the risk to benefit ratio, which will be different for each person and each income stream.

Of course, you could take the risk that your 201K will re-inflate into a 401K, and taxes will be reduced, and Social Security will provide a comfortable retirement … or … you will continue to have your current earning power when you are ninety years old.   

That’s too risky for me.