The United States may go into a recession. The world may go into a recession. Some areas of the world are at war. The United States will continue engaged in many wars. A civil war is not likely, but not impossible. No one knows what we humans will do in the future because we are too many and there are too many variables to compute. Eventually, with more computing power, we will be able to predict the future as easily as we can predict the weather. How can you prepare financially for any crisis? How do you build a recession-proof, war-proof, climate change proof economic profile and investment portfolio?
Slap Consulting serves food for thought. We toss words together to slap you into innovative thinking. Carryout at TakeSlap.com
Specialized production. Diversified investing. That's all it takes.
To stay ahead financially in whatever the future may bring, specialize your production and diversify your investment. Specialize producing something that you enjoy producing and that people want to acquire. Diversify your portfolio in global stocks.
Unless you are inheriting money or marrying into money, your only way of obtaining money is trading. Money is a clever human invention. It operates as a payment technology. That is, money is a tool and method to facilitate economic valuation and payment. Another way to see it, is that money is a permit. Money authorizes you to obtain property or services.
Regardless of how you conceptualize money, the key fact to remember is that you are not authorized to print your own money. You are only authorized to create goods (products or services) that you can trade for money.
Think about slaves and prisoners. Slaves were poor because they were not authorized to produce goods that they could trade for money. The same applies to prisoners. If you are not a slave or a prisoner, and are relatively free and healthy, nothing stops you from creating goods (products or services) to exchange for money. People will always need trade to survive whether it is in "good" times or in "bad" times. Regardless of the crisis of the day and the news about the sky falling daily, you can always focus on production of goods for profitable trade.
Trading
Since you cannot print your own money, you have to earn the money that is printed by the government. You earn it by trading something of value. Value, like beauty, is in the eye of the beholder. Different people see different value in different things. Your goal is to trade value (whatever that may be) in exchange of money. Your best bet is to focus on producing whatever you are good producing. Specialize in becoming the best you that you can be. That will lead you to becoming the best trader that you can be.
Investing
A portion of the money that you receive, you will spend to survive and live well in the present. Another portion of the money, you will invest to survive and live well in the he future. Literally, to invest means to get in a vest or to get a vest on. Therefore, you can think of investing as getting "dressed" or buying clothes for the future. Pack wisely so that you are not cold in winter, hot in the summer, or inappropriately dressed for different events coming your way. Diversify, diversify, diversify.
No one knows for sure what will increase in value in the future. We still lack sufficient computing and AI capacity to predict with certainty what humans will do and how environmental variables will impact human decision making. Therefore, the best approach to investing is global diversification. Don't put all your eggs in one basket. Don't put all your baskets in one country. Don't plant all your seeds in one location. Spread them around to see where they grow. The easiest way is to buy stocks in well diversified exchange traded funds (ETFs).
Making money
Yet again, before you can invest, you have to earn money first. And how do you earn money? Trading something of value. The key is to specialize. Find your niche. Become a specialized producer of a good (product and/or service) that consumers want and are willing to pay for.
Think of any person making money. They are exchanging a good (product or service) that people want to buy. Whether it is a product or a service, they are making money because people (individuals or other businesses) are willing to pay for it.
Crisis-proof productivity and investing
Specialize in producing something that people will want to buy regardless of whether we are in a recession, at war, surviving a climate change hurricane, or whatever else may come. Likewise, invest in widely and globally diversified property rights that can survive a prolonged recession, deadly wars, climate catastrophes, and the like.
Specialize in producing goods that people will need to survive and will want to live well. People will want to survive and live well regardless of whether the world turns to hell. Become the best at your own specialized trade. Invest a portion of the proceeds in well diversified exchange traded funds (ETFs) that track globally diversified index funds. Forget about trying to pick individual stocks. It is almost impossible to predict what will happen to a particular company. Yet, you can bet that all economic sectors will survive. Why? Because trade is essential for human survival.
Food for thought. What do you think?
--TakeSlap.com
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