Monday, October 20, 2008

Being on the Wrong Side

One reason we all like to follow the trend like lemmings is the fear of being on the wrong side of things. Deep rooted conditioning of 40k + years, have taught us that in order to survive, we must be united against the elements. It made and still makes a lot of sense especially when looking at the markets as we are today. But evolution would not have taken us very far if that is all we did.

In order to evolve new things have had to be tried otherwise, we would not have been able to use tools, make fire, invent the wheel....etc. Trial and error... read that: risk and reward, failure and success... took many-a casualty, yet the desire to forge forward was not thwarted. Much like today, the the downward slope is easier to ride, yet it is the surviving risk takers that will reap and give the greater rewards over the long term.

The very same risk takers that today so many people want to bring down and destroy. The entrepreneurs, the small business man/woman who are willing to work and give work, those large companies which still operate with integrity and you and I who are willing to work for ourselves by ourselves all of us doing our small bit for society and the economy.

Today, we find ourselves on the wrong side of people who claim we've made too much, and we are evil for wanting to do more; therefore we should be mandated to share of what we have. Which is the exact same philosophy that got us into this financial mess in the first place. The Community Reinvestment Act passed under Carter, expanded under Clinton in 1995, which led to the sub prime lending frenzy, and which in turn led to today, all were based on the well intentioned "spread the wealth", "everyone has a right to have their share" philosophy. Like lemmings everyone went along and most who didn't wish to see it coming, fell off the cliff and now blame everyone but themselves for the "generosity" going awry.

When you are on the wrong side of a trade what do you do? When you see your funds evaporate does it make a difference if it's fast or slow as to what action you take? If I am correct, I know the answer: you analyze, admit a bad decision and get out before it gets worse or before you lose all that you have worked for. That is the self-directed approach to living: the one they call greedy.

Those, realizing that a course correction is needed, get to save themselves from disaster and are able to enter another opportunity most likely making good, contributing to society and the economy again. In contrast, those that fall of the cliff, can't because they lost it all. Yet not seeing their folly they are most likely the ones who think it should be tried again, and therefore ask for another helping hand from; Guess who? They never seem to wonder: When the cow's dead, what is to give milk? So goes the vicious cycle until one day we awaken to face a very life altering choice.

I give you a challenge to read two documents today. You may think you know them but when was the last time you read either one?

TheUSConstitution and TheCommunistManifesto

It's not a long read but may take a bit of introspection and analysis because now you have to choose: Which laws would you rather live, create and work under?


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