"Don't go around saying the world owes you a living. The world owes you nothing. It was here first."
-Mark Twain
Welcome to The Golden Sense! The title of this post probably resonates with everyone. Whether you are rich or poor, an individual or a company, a state or a country, income is hard to come by.
The poor guy can't find work and the rich guy can't find a place for his money to work for him. The world is saturated with products and deflationary forces are cutting into the income of businesses worldwide. The Governments of the world are broke and they're running out of places from which to take money. Income is the problem and it is seen as the new normal.
How does one approach the income problem?
I'm not too worried about businesses. Their entire operation is about finding and optimizing sources of income. I'm not worried about Governments either. Most are going bankrupt whether they like it or not.
The focus lies on the individual. What can you do to build and optimize your income?
There are three steps when attacking the income problem.
First: If you want a good income you have to network and do business with people that think and operate with the amount of money you desire. Whether you start your own business or work for a company, you should choose a line of work that falls in line with your income expectation.
If you work for a business that operates in terms of "thousands" of dollars, you will probably earn "hundreds" of dollars.
If you work for a business that operates in terms of "millions" of dollars, you will make "thousands" of dollars.
If you work for a business that operates in terms of "billions" of dollars, you might make "millions" of dollars.
The point is, don't expect a million dollar paycheck if you work at a pizza parlor. Don't get me wrong, working at a pizza parlor is honorable work but if you want a higher income you have to identify where the money is and get involved. There is much more to choosing a profession than just money, but don't get involved in an industry that cannot support your income expectation.
The idea is to find a primary source of income and enhance it to the best of your ability.
Second: Set up multiple income streams. Income streams are anything that creates a cash flow. A job, additional contractual work, dividends from a stock, interest received from bonds, or any product that sells and generates an additional income.
Most people just have their sole job or business that acts as their only source of income. Don't stop there, make your money work for you or create a product that can be sold. By creating three or four income streams, cash flow becomes less of a problem.
People often mistakenly don't follow up with developing additional income streams because they deem them to be too small or insignificant. Whether they are big or small you want to create as many additional incomes as possible. After securing multiple incomes, you will be pleasantly surprised with your cash flow.
If you have an additional $500 to $2,000 you can purchase a dividend paying stock or a bond. You can do this by opening up an account with an online broker such as TD Ameritrade or Scottrade.
For example, you could open up one of these accounts online and put in a buy order for 100 shares of Taiwan Semiconductor Manufacturing (TSM) and receive a yield of 3% or $50 a year. Another alternative would be to purchase 100 shares of PIMCO Income Strategy Fund (PFL) and receive an extra $9 a month. Please remember, these are strictly examples and not investment advice.
With multiple income streams you will be less dependent on your primary source of income. This is vital to your financial security and it will eventually give you more financial freedom.
Third: Hedge your income sources. This means you should set up income streams that offset the variables incurred by your other income sources.
If your primary income stream is variable such as selling art or real estate (usually commission based), then the best practice would be to put your extra money to work in a stable dividend paying stock or a bond. The idea is that these securities will provide a stable cash flow while your main source of income will come in large chunks at a time. The two income streams will balance each other out and provide you with greater stability.
If you work in the finance industry, then you should put your money to work in foreign stocks or store it in precious metals to hedge against a job loss or a possible catastrophe in the fragile financial sector.
When setting up additional income streams you want to give yourself variety. Never become dependent upon one entity or industry.
Diversifying your income and savings will create stability and provide a larger cash flow for you.
Generating income can be tough, but without income life gets tougher. By identifying where the money is, setting up multiple incomes, and hedging your risks the income problem will cease to exist. It will be nothing more than something that requires routine maintenance. It comes down to implementing a strategy; because having a strategy is almost always better than not having one at all.
Sincerely,
T. Norman
Come mid-October, the U.S. government will no longer be legally allowed to issue more debt, according to a letter written by Treasury Secretary Jack Lew to Congressional leaders earlier today. That’s when the Treasury will exhaust the so-called “extraordinary measures” it has undertaken to avoid going over the Congressionally imposed limit on total federal debt of $16.7 trillion set in a budget deal in May.
Read more: http://business.time.com/2013/08/26/treasury-secretary-to-congress-u-s-to-hit-debt-ceiling-in-october/#ixzz2dC4QNeKr
Simon Black of Sovereignman.com
Reports from
Spoleto, Italy
August 22, 2013
One of the really great things about being in Italy is that this whole country serves as a constant reminder that wealth and power in the world are constantly shifting.
Two thousand years ago, Italy (Rome specifically) was the pinnacle of civilization, at the forefront of medicine, art, technology, commerce, and military tactics.
You can still see so much of this today; Italy is full of monuments and ancient public works that are still in amazing condition to this day. They put so much care and attention into their craftsmanship, they clearly designed to very high standards and built everything to last.
Everything, of course, except for their political and economic system.
In its later Empire years, totalitarian control of everything-- the military, finances, money supply, commercial code, etc. fell to a very tiny elite... in most cases, one man.
And as one Emperor after another bankrupted the treasury through foreign wars, palatial opulence, and unaffordable social welfare programs, Rome gradually changed for the worse.
Desperate to keep the party going, later Emperors debased the currency to the point of hyperinflation. They imposed wage and price controls under penalty of death. They raised taxes so punitively that people simply quit working altogether.
With each successive emperor, Romans would foolishly believe that the 'new guy will be different' and that things would improve. Of course, apart from the occasional sage, Rome's political leadership became more destructive.
By the time foreign barbarians began invading Italian territory, Roman citizens were so fed up that many of them welcomed the marauding hordes with open arms.
For more than 1,000 years, other kingdoms and empires assumed the role of the world's economic and political superpower-- from China's Tang Dynasty to the Mongolians to the Ottoman Empire.
Eventually, though, wealth and power shifted back West... to Italy once again. Venice flourished and became the leading power center in Europe.
Its recipe for success was quite simple: at a time when the vast majority of human beings barely eked out an existence under the feudal system, Venice enshrined economic freedom.
In Venice, people who were born with absolutely nothing could become fabulously wealthy with enough hard work, risk taking, and a little bit of luck.
It sounds a bit like the American Dream... nearly 1,000 years ago.
It was under this freedom that modern banking was invented in the 12th century. Foreign exchange contracts. The bond market. All of this came from Venice.
Of course, they eventually screwed it up.
In the early 1300s, the ruling elite eliminated the economic freedom that had made enriched so many people. The government also began charging exorbitant taxes and nationalizing trade routes.
Other cities in Italy-- Florence, Genoa, etc. soon had their time in the sun as well. But power and wealth eventually shifted from Italy to the Habsburg Empire, then the French Bourbon monarchy, the British Empire, and ultimately to the United States.
This is a very familiar and inevitable cycle that has repeated throughout history... and at least twice in Italy. Wealth and power always shifts.
This is happening right now in the West. The US and Western Europe are getting progressively weaker-- more indebted, and less free.
This isn't something that happens overnight... it's a long, gradual shift that has already been unfolding for decades. But it's Venice and Rome all over again. And the current is accelerating.
Coupled with the decline of the central bank-controlled fiat system, this is likely to be the biggest story in modern history.
The warning signs are all there-- it's almost like having a time machine and being able to go back to 14th century Italy.
Imagine being able to travel back in time and arrange your business, your portfolio, and your assets, knowing exactly how things would unfold.
We have that opportunity now. And depending on how far in front of this trend you are, it could really make all the difference between being a victim, barely surviving, or building generational wealth for your family.
