The wealthy know every economic downturn or recession “recovers” when people decide the risks of loss are not a concern anymore. It’s just that they decide to spend when everyone else is hunkered down in fear not spending.
The wealthy, the contrarians, know recovery is another term for middle and late stage human herd decision making that it’s safe again to come out and spend. By then, the wealthy have snatched up all the best deals because they have learned how to be brave and overcome their fears to reach their financial potential.
A downturn is simply your choice to buy high, and sell low. The wealthy count on your fear as their opportunity to buy low, then sell it all back to you at the top of the market–when everyone feels safe to spend again because we have “recovered.” What has been recovered? A feeling of security based on being told its okay to spend again.
Lawyers Aren’t the Only Liars
Just a caution about bankers and their messengers, bank economists. At the highest level, bankers are among the wealthiest. While they are telling the middle and lower class to not spend because their wages are not enough, they are creating those very conditions! Why?
They are out buying up all the best real estate, business opportunities, and cheap goods while everyone else lives in fear chattering about how bad things are! Once they have acquired the best opportunities and value (people selling at the bottom of the market out of fear or lack of cash), they will change their policies to make money selling the picked over economic opportunities at higher prices to the general population called “the herd.”
Read more about The Herd:
It’s Your Choice To End Your “Downturn”
It’s always the same cast of characters: wages going up as demand exceeds supply, capex spending by business to expand to capture more of the growing market share pie, reserve and treasury getting lending rates right, consumer spending on houses, goods, and discretionary “good times” lifestyles.
It’s all a choice. We must spend our way out of recessions. The government can only take their foot off the brake and create the conditions for growth. We must get our wallet out and spend to create wage growth and demand. That’s the way it works. It’s all in our head and the story we tell ourselves and others.
I recently bought big ticket items in the face of a down economy. Why? I see the opportunity that the herd being afraid has given me. I am a contrarian. Always have been. While everyone is hunkered down afraid (perceived fear of loss = risk), and the sky is falling, that is the time to spend money.
Let’s Get Wealthy
Buy now while demand is down and supply is up. That’s what value-growth investing is based on. If you are a business, it’s the time to spend on marketing to gain share of wallet and market share. It’s time to use capital to buy assets. It’s time to snap up the best talent that has come on the market at the bottom of a market just as it is turning ever so slightly back up.
If you let fear drive your thinking and decisions, you will miss the opportunities and be playing catch up after others have captured value. Lost opportunity is what all the laggards and ultra-conservatives with no appetite for risk call a recovery.
The wealthy know to buy low, sell high. Now is the low. Resist fear and invest.
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