Understanding the Current M2 Money Supply

The Federal Reserve has one tool comprised of 3 separate functions which are all a mechanism to increase liquidity in the overall system. To express this liquidity, the following chart from the Fed shows the M2 money supply levels:

The 3 functions are the printing of currency, the monetization of U.S. Treasury debt (QE, QE2, QE2.5, Operation Twist), and exceptionally low interest rates (ZIRP) near 0 for an "extended period of time (2014)."

If central banks around the world continue to print money there are only a few places to hide. Precious metals and other commodities like oil will vastly outperform stocks in the long run if the Dollar continues to slide.

Chris Vermeulen [The Fed, the S&P 500, & Why Gold Is Shining Bright; January 27, 2012]

Are you feeling Intimidated? This can hold you back from achieving many things!

Any time you are too humbled to admit what you see in them is inside you and you are exaggerating what they have and minimizing what you have, you set yourself up for intimidation.

Road to wealth: Wealth cycle

Predicting the future...

"...... predicting the future is never easy. The best chance of getting it right results from having a clear understanding of the past, an understanding of the direction in which the most important factors are moving and the momentum with which they are moving. If a person has a good understanding of what the important factors are (credit/debt, government spending, paper money creation, globalization, income & income distribution, and technological change), their history and their momentum or force, then he or she will have a much better chance of understanding how those factors will shape the future." Richard Duncan [Author of The Dollar Crisis]

Quote of the week

"Money has never been important to us, but our freedom and the freedom for our children means everything!"
Philip & Lisa H. 

US NATIONAL DEBT [Peter Schiff U.S. is In Worse Shape Than Europe;FoxBusiness Jan 17, 2012]

"The crisis we are creating is going to be much bigger than the financial crisis of 2008; and if our leaders couldn't see that one coming it stands to reason that they're not going to see this one coming." Peter Schiff

Assets vs. Liabilities

Simplified:
Assets cashflow money into your pocket [income]
Liability takes money out from your pocket [expense]

Eg. A house you own can be both an Asset or a Liability depending on the key word CASHFLOW. If you are renting out your property and it is bringing CASHFLOW into your pocket every month, then it's an ASSET. If you are living in your property and have expenses related to the ownership of this property, flowing out each month, then it's a liability. This is an important differentiation and to be RICH you need to understand this.

Sharing a personal message from my mentor

Dear.........,

More than terrorism, more than natural disasters, the biggest fear most people have is outliving their money. Our natural reaction to any fear is to fight, flee or freeze. Financial fear often leads to paralysis - where you ignore your money problems and hope they will somehow go away.

Don't let fear cost you money.

Every day I am seeing increasing turbulence in the markets. "Playing it safe" by trusting others with your financial future is probably the riskiest thing you can do. People who used to dream of getting rich are now just hoping not to lose their home. Without financial education, you're at the mercy of the market.

Sincerely,

Mentor

How you look at MONEY

If you truly do not have a value on MONEY, then you will struggle with it your whole life.

When the WHY is big enough the HOW's take care of themselves, if you have a big enough reason for building wealth- you will!

1. What are the benefits of building a business that serves ever greater numbers of people. Money is a bi-product of services rendered.
2. Write down the benefits of polishing, refining and managing most effectively and efficiently that business to maximize profits. Work on the business and not just in the business.
3. You have to save the profits. If you don't have liquidity you have volatility. So you must have liquidity. If you have liquidity you don't have a survival mentality, you think about CREATIVITY. This is the importance of psychology of having a stable foundation to build an empire around it.
4. Write the benefits of investing in an ever progressive leverage and risk system.
5. Write the benefits of amassing a fortune.
6. Write down the benefits of creating a cause a financial cause that leaves a legacy.

From Dr John Demartini

Quick tip: We have a Body, we have a Mind and we have a Soul

The body must be guided by the Mind, Mind must be directed by the Soul, in order to maximize Human Potential!

"Most people, when they're not living fulfilled by their highest values, they're looking for immediate gratification which cost them their life, instead of long term vision that inspires them." Dr John Demartini

Quick tip: Overcome your FEAR

Decide on the path to financial freedom, get the financial education you need to succeed and take ACTION now!

Why the Wealthy Own Gold [Monday, 9 January 2012; Mark Motive- publisher and chief author of Plan B Economics]

The global economy is in turmoil. Europe is on the verge of collapse, probably taking the US down with it. As the euro-crisis worsens, we march ever closer to outright monetization of European debt by the ECB and, covertly, by the Federal Reserve. The developed world is perilously close to a monetary deluge that could make the Weimar Republic's hyperinflation look like amateur hour.  

Yet, I still talk to Wall Street analysts who clearly misunderstand gold's place in a portfolio. Meanwhile, many people who are part of the world's wealthy class are hoarding gold. What do they know that others don't?

If you ask the common man in the street about investing in gold, most will give you a strange look. After all, they believe investing is about stocks, bonds, and CDs.

If you ask someone with a bit more investing knowledge, they will tell you to buy gold during inflationary periods.

If you ask a relatively sophisticated investor, they will tell you to buy gold during deflationary and inflationary periods. Some may even say to buy gold during periods of uncertainty and instability, or when real interest rates are negative.

However, if you ask the world's wealthy class about gold they will give you a very different answer. At Plan B Economics, we've found that most of the world's wealthy class doesn't view gold as an investment at all! I would argue these folks have it right. Simply put, they consider gold to be a store of wealth and believe that anytime is a good time to own some gold.

Read more @ ORIGINAL SOURCE

2012 outlook from Jim Rogers perspective 03 Jan 2011

Inflation

"Inflation has always an indirect form of taxation that imposes a hardship on those with fixed incomes"
Martin Armstrong [ http://armstrongeconomics.com/ ]

Chinese proverb...

"The best time to plant a tree is 20 years ago, the second best time is today!"

Empire Club Outlook 2012: Why Rising Debt Will Lead to $10,000 Gold [Jan 06 2012]

"Individuals can protect or even increase their wealth through Gold ownership" Nick Barisheff

Quick tip: The Rich understand the power of compounding

Compound interest is when you earn interest on your interest. To demonstrate the power of compounding, suppose you deposit $10,000 (principal amount) in an investment account that pays 10% interest annually;

At the end of:-
1 yr $11,000
2 yr $12,100
3 yr $13,310
4 yr $14,641
5 yr $16,105.10
6 yr $17,715.61
7 yr $19,487.17
8 yr $21,435.89
9 yr $23,579.48
10 yr $25,937.42

After 10 years, your total percentage returns is 159.37%

Americans make up half of the world's richest 1% [By Annalyn Censky @CNNMoney January 4, 2012: 11:41 AM ET]

Outlook on CURRENCIES in 2012

"Ongoing political uncertainty is likely to continue to weigh on markets. With ongoing financial tensions in Europe evolving into contagion risks to global economic growth, we believe central banks around the world may begin another round of expansionary monetary policies in 2012. The process is already underway - policy makers in Asia, notably China, have already begun relaxing policies, while the central banks of Australia, Norway, Sweden and the ECB have all cut target rates. There will be a much more dovish composition of FOMC voting members in 2012 and the central banks of Japan and the U.K. have also shown they are most willing to put in place expansionary policies. We believe these trends will benefit the currencies of commodity producing nations, as well as the Asian region."  Axel Merk 

Quick update: European debt crisis; is US dollar a safe haven?

Here is what Peter Schiff [CEO of Euro Pacific Capital] had to say about this:

"Once again, the mainstream narrative is that the real danger is in Europe and therefore the US offers a safe haven. This has caused a stampede out of the euros and into dollars. But as we've seen over the last few years, the euro and dollar can decline simultaneously - and will continue to do so as more and more investors realize that the real safe haven is gold."

"For smart investors, dollar strength caused by euro fears is simply an opportunity to buy contra-dollar assets on the cheap. Yes, I believe sub- $30 silver and sub- $1600 gold are still cheap for what's ahead. And with 2012 forecasts of $2,200 by Morgan Stanley, $2,050 by UBS, and $2,000 by Barclays, it appears I'm not alone.

To read more, here is the FULL ARTICLE


If you are interested in GOLD, then perhaps your should notice SILVER. Here is what, James Turk [Founder & Chairman of Goldmoney.com] had to say about Silver from his interview with Eric King;

James Turk - Gold is great, but Silver is the next Apple


To learn more about Silver investing, follow my blog; silverreport.blogspot.com

Quick tip: Opportunities comes to those that are READY

The Rich sees enormous opportunities in time of economic crisis, and employ their CASH in undervalued investments

EUroZone: Europe at the Brink, Part 3: The Crisis Spreads [Jan 4, 2012]

EUroZone: Europe at the Brink, Part 2: A Fuse Is Lit [ Jan 4, 2012]

EUroZone: Europe at the Brink, Part 1: Imperfect Union [Jan 4, 2012]

Quick tip: Surround yourself with people that keep you FOCUSED

When you surround yourself with people who have already achieved what you want to achieve, you greatly increase your likelihood of success.

Quick tip: THINK LIKE THE RICH!

The most effective way to change your current financial state [poor and middle-class] is to change how you think about money. THINK like the Rich and change your life, because thoughts drive behavior.

Pay yourself first!

Financially successful people have a good habit of paying themselves first. For every dollar that flows in, a given portion is put aside (ranging from 10-30%) before paying their expenses. Let's say it was 20%. Half of this may go into a savings account for their emergency fund and the remaining half may be put into an investment account.

Multi-millionaires not only have the discipline to save, but are always thinking about ways they can expand their means and increase their cash flow. Notice what's wrong or missing in the world and find opportunity in it.

Seven stage life cycle of currency

Stage 1 – Good Money
Stage 2 – Social Programs
Stage 3 – Military Empire grows
Stage 4 – Funding the military

Stage 5 – Currency taken off the Gold Standard
Stage 6 – Inflation [three major problems with the events of 1913, 1944, and 1971. The first is that the Fed, the World Bank, and the IMF are allowed to create money out of nothing. This is the primary cause of global inflation]
Stage 7 – Currency collapses

The global economy is currently between stages six and seven and history has shown us that the greatest transfer of wealth occurs during these two stages. ALL fiat-based currency systems throughout history have failed, and 40 years is typically the longest such systems survive before collapse or mass devaluation. This information is vital to understand so that anyone can capitalize on the opportunity during these current economic conditions. Opportunities this big don't come along often, so this is your time to get rich!

"Without financial education, your money flows to those who profit from your financial ignorance" Robert Kiyosaki

Singapore's 40 Wealthiest, 2011 [Information from Forbes.com]

40. Sunny George Verghese [210mil]- CEO of OLAM INTERNATIONAL (Agriculture)
39. Victor Sassoon [235mil]- Owner of Coffee Bean & Tea Leaf
38. Vivian Chandran [238mil]- Sold their 51% stake in Chemoil to commodities firm Glencore
37. Mustaq Ahmad [240mil]- Owner of Mustafa center
36. Yaw Chee Siew [260mil]- Chairman and major shareholder of OTTO MARINE (Oil & Gas)

35. Lee Kian Soo [300mil]- Founder of EZRA HOLDINGS (Oil & Gas)

34. Cheng Wai Keung [305mil]- Chairman of WING TAI HOLDINGS (Property)/Also Chairs Neptune Orient Lines

33. Oei Hong Leong [310mil]- Son of Indonesian Billionaire

32. John Lim [340mil]- ARA Asset Management (REIT)

31. Ho Kwon Ping [345mil]- Banyan Tree Hotels & Resorts 

30. Simon Cheong [355mil]- Runs SC GLOBAL (Property Developer)

29. Kwek Leng Peck [380mil]- Inherited stake in HONG LEONG GROUP 

28. Yao Hsiao Tung [385mil]- Cofounded Hi-P International (Electronics maker)

27. Olivia Lum [460mil]- Founder of HYFLUX (Water-treatment)

26. Ow Chio Kiat [465mil]- Chairs Stamford Land (Hotels & Property)

25. Henry Ng [485mil]- Controls Pan-United (Singapore's largest cement & concrete supplier)

24. John Chuang [510mil]- Co-Founder of PETRA FOODS (Cocoa ingredients supplier)

23. Loo Choon Yong [515mil]- Co-founder RAFFLES MEDICAL (Healthcare)

22. Ron Sim [540mil]- Founder of OSIM INTERNATIONAL

21. Chua Thian Poh [555mil]- Co-owner HO BEE INVESTMENT (Property Developer)

20. Chang Yun Chung [645mil]- Co-founded Pacific International Lines (Shipping)

19. Kwek Leng kee [680mil]- Inherited stake in HONG LEONG GROUP 

18. Ho Sim Guan [715mil]- Stake in UNITED OVERSEAS BANK

17. Peter Fu Chong Cheng [720mil]- Head of Kuo International (Oil traders)

16. Lim Oon Kuin [840mil]- Founded Hin Leong (Oil trader)

15. Tan Boy Tee [850mil]- Founded LABROY MARINE (Tug-and-barge operator)

14. Koh Wee Meng [920mil]- Founded and CEO of FRAGRANCE GROUP (Property Developer)

13. Lien Family [1.1 Billion]- Inherited stake in United Overseas Bank

12. Sam Goi [1.2 Billion]- Food Tycoon (Singapore's Popiah King)

11. Zhong Sheng Jian [1.3 Billion]- Founder of YANLORD LAND (Property Developer)

10. Lee Seng Wee [1.4 Billion]- Retired Chairman of OCBC (Bank)

9. Kwek Leng Beng [1.7 Billion]- Heads Hong Leong Group (Conglomerate)

8. Peter Lim [1.8 Billion]- Veteren investor sold stakes in WILMAR & HEALTHWAY MEDICAL

7. Ong Beng Seng & Christina Ong [1.9 Billion]- Controlling stake of Mulberry (Fashion)

6. Kuok Khoon Hong [3.5 Billion]- Runs WILMAR INTERNATIONAL (Palm oil)

5. Kwee Brothers [3.9 Billion]- Own and control Pontiac Land (Property Developer and hotel operator)

4. Richard Chandler [4.0 Billion]- Co-founded Sovereign Global (Investment firm) and started Richard Chandler Corp.

3. Wee Cho yaw [4.2 Billion]- Chairman of UNITED OVERSEAS BANK

2. Khoo Family [6.7 Billion]- Inherited stake in STANDARD CHARTERED BANK and sold it to Temasek.

1. Ng Family [8.9 Billion]- Privately hold Far East Organisation

Warren Buffett's 10 Ways to Get Rich

1. Reinvest Your Profits- Use proceeds to buy stocks or start a business
2. Be Willing To Be Different- Look for undervalued investments
3. Never Suck Your Thumb [unnecessary sitting or thinking]- Swiftly make up your mind and act on it
4. Spell Out The Deal Before You Start- Always nail down the specifics of a deal in advance
5. Watch Small Expenses
6. Limit What You Borrow- Negotiate with creditors to pay what you can
7. Be Persistent- Merciless negotiator and unwavering courage
8. Know When To Quit- Know when to walk away from a loss
9. Assess The Risk- Imagine the worst-and-best-case scenarios
10. Know What Success Really Means- "...you'll measure your success in life by how many of the people you want to have love you actually do love you..."