Monday, May 6, 2024, Delray Beach, Florida


Notes From My Journal

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Things I’ve Been Thinking About Lately 

Speechwriting (with a Little Help from My Friends) 

I’m a little nervous. I can’t deny it.

In July, I’m going to be in Tokyo for two days, lecturing to 2,000+ Japanese investors and businesspeople that, I’ve been told, have read some of my books and essays and want to hear what I have to say about several topics I’ve written about for many years: entrepreneurship, investing, business building, and “living rich.” Plus, I’ll be having informal discussions with a small group of attendees who’ve paid a whole lotta money to ask me more particular questions.

I’ve given dozens of presentations to large groups over the years, although never to a crowd that large. My M.O. is to tailor the title of my speech to the nature of the seminar or conference, jot down a few notes, and then talk extemporarily when I’m at the podium. So that doesn’t scare me.

And I feel very comfortable about the informal discussions because I see them as the sort of business meetings that I’ve headed up thousands of times in my career: We have a problem or challenge for which we need ideas, if not solutions. And I always have plenty of ideas.

I’ve made presentations all over the world, from England to Ireland to Germany and Australia. But I have a special feeling about the Japanese. I see them as representatives of a culture that is more advanced and sophisticated than others I’ve worked with. They have characteristics that are instrumental in achieving a level of wealth (and education and health) that inevitably surpasses that of the people of any country they happen to live in. (I’m currently writing a book about this. Working title: Wealth Culture.)

In other words, they have ingrained values that exhibit every important “secret” about building wealth and living well that I’ve learned and written about for the last 20 years. What can I tell them that they don’t already know?

I’ve reminded myself that when it comes to success and accomplishment, the most important secrets were discovered millennia ago. So, I don’t need to tell them something new. I just need to find a new way of explaining the age-old and universal truths.

One of the presentations I’ve decided on will be titled “The Seven Natural Laws of Wealth Building.”

The idea is that there are basic truths about building wealth that have parallels in natural science. I already know the seven “truths” I want to speak about. But I have so far only found four corresponding laws of nature (inertia, momentum, gravity, and entropy).

I’ve been asking scientifically minded friends for suggestions. And BB, an A-level copywriter and a published science fiction writer, sent me a link to Understanding Physics by Isaac Asimov. (“My favorite book on physics for the lay reader,” he said.) He also sent a piece on gravity that he wrote years ago.

I’m reading his gravity piece now, and I’m about to scan the book for other ideas. If you have any suggestions, please email them to me. Soon!

 

Just When We Thought We Understood the Overpopulation Problem… 

Back in the day, overpopulation was the worry. The way to save the world, we were told, was to have fewer babies.

That idea took root in the 1970s and picked up steam at the turn of the century – so much so that there has been a huge drop in birth rates worldwide. And that is a serious problem, according to the current crop of population scientists. A serious problem that is diminishing GDP output and putting enormous pressure on the world’s young workers to pay for the retirements of the Baby Boomers.

Between 2015 and 2020, US birth rates declined about 2% each year. Between 2019 and 2020, they decreased by 4%. And in 2023, according to the CDC, they dropped to their lowest levels in more than 40 years.

On the hopeful but unlikely “positive” side, since Biden took office the border police have allowed about 10 million undocumented aliens into the country. If they turn out to be productive, tax-paying workers, that could help close the birth-rate gap and improve the outlook for all Americans.

On the other hand, if too many of them end up on government assistance or working for US outposts of Mexican and Central American drug and human trafficking cartels, the social and economic future of the US will be… well, not so good.

News & Views

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Brilliant. Scary. Crazy.

Meet Victoria Shi

She is a spokesperson for Ukraine’s Ministry of Foreign Affairs. But she’s not real. She’s AI-generated. In this clip, she introduces herself and explains how she was named, what her role is, and how future audiences can verify her identity.

What she doesn’t tell us is why she was created. And that, it seems to me, is obvious. What could be better in terms of presenting political positions, explaining them, and defending them than a being that is connected to AI? No mistakes. No misunderstandings. Everything programmed for maximum clarity and maximum rhetorical effect.

So, I believe there will be lots of “Victoria Shis” in all our lives in the future. The not-too-distant future. They will be speaking for governments – federal, state, and local. They will be representing non-profit groups and corporations, too. Eventually, they will be speaking for high profile individuals (e.g., movie stars, bestselling authors, and superstar athletes) that want a more “personal” connection to their fans.

We already know from dozens of experiments – not to mention billions of interactions with Siri and Alexa – that the general public will accept them. So there’s nothing to keep it from happening.

Welcome to a brave, new world!

Election Watch 

Do You Know Who Kristi Noem Is? 

She’s the good-looking governor of South Dakota, and has been a top contender for the Trump VP slot. And she’s just published a best-selling memoir – No Going Back: The Truth on What’s Wrong with Politics and How We Move America Forward.

I don’t read memoirs. But I do read reviews of memoirs. And I’m glad I read this one by Nellie Bowles in the May 3 issue of Free Press, because it contained this wonderful little vignette:

“In her memoir, [Noem] writes about her 14-month-old wirehaired pointer, Cricket.

“Cricket really annoyed her. She took Cricket out hunting, and Cricket was useless. ‘I hated that dog,’ she recalls. So when they got back from the not fun pheasant hunt, she took Cricket out back to a gravel pit and shot Cricket dead.

“Seemingly pleased with herself, she then went and found a particularly annoying goat, brought that one over to the gravel pit, and shot the goat dead too. She presents this as life on the farm.

“Now, I have family who farm, and honestly the main thing about their life is how much they love and care for animals. I swear to god they have ten stray cats they’re feeding, and if one of them bites it’s definitely your own fault.

“Farms are not special places where random wirehaired pointer puppy slaughter is approved. It’s not that squeamish city folk just don’t understand what it takes to maintain the heartland. The actual news from this is that ‘Trump insiders’ say Noem is definitely not the VP pick after this freaky little anecdote.”

What do you think?

Health Watch 

Guess What? The Sun IS Good for You – Even for Your Skin! 

Skin cancers are by far the most diagnosed cancers in the United States. And to prevent them, the public is constantly being told to avoid the sun.

I’ve written about this subject many times. In fact, about 20 years ago, a colleague and I – finding it impossible to believe that sunlight, which feels so good on the skin, can be deadly – investigated the scientific literature and published a report that, unfortunately, nobody paid attention to.

Now, decades later, an article by a doctor in Vigilant News corroborates many of the things we had discovered. A few examples:

* While the relatively benign skin cancers are caused by sun exposure, the ones responsible for most skin cancer deaths are due to a lack of sunlight.

* Sunlight is arguably the most important nutrient for the human body. Avoiding it doubles the rate of dying and significantly increases the risk of cancer.

You can read the entire Vigilant News article here.

The Economy & Investing

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The Supply Crunch in Luxury Homes 

The difference between a mortgage rate of 3%, where rates were four years ago, and 5.5%, where they are today, can make a significant difference in the monthly mortgage payment for middle-income buyers. Many are not able to buy homes they could have bought four years ago. So, they have a choice: Buy less of a house. Or don’t buy at all.

For high-income home buyers, that sort of interest-rate differential is not significant, and the demand for luxury homes is still strong. The problem, says California realtor Ken DeLeon, is that “the lack of supply almost perpetuates the lack of supply because sellers don’t have anywhere to go.” (Since 2000, the average monthly number of active existing-home listings has dropped 45%, according to a recent report.)

If you are interested, you can read more here.

 

A Different Kind of Dumb: How the US Sabotaged Itself in 1992

In this concise and amusing little essay, Bill Bonner explains how, in 1992, the US stood on top of the globe, with the world’s largest and strongest economy, a relatively happy and productive workforce, a strong dollar and a vibrant stock market, and what looked like the beginning of a new era of world peace.

But then…

Click here to enjoy Bill’s summary of how we F-ed it up.

 

Chart of the Week: The Speed of Compounding

When our nieces and nephews were young, K and I opened accounts for them. We deposited an amount of money that was not great, but enough so that if they wanted to, they could have used it to buy a late-model used car. However, we told them that we didn’t want them to spend it. We wanted them to save it. If they did, we explained, they would end up with a lotta, lotta money that they could use to add to the enjoyment of their lives when they retired.

This week, Sean gives us several charts that explain the “miracle” of compound interest. What happens, as you can see, is that it begins steadily and slowly. But then, after 20 and 30 years, it ascends steeply. The end numbers are truly mind-blowing. – MF 

Most people reading this have heard about the power of compound interest.

Compounding is a simple investment strategy in which you put your money in an investment that pays a cash return, such as a dividend.

You then take your cash return and reinvest it. Your reinvested dividend, or interest, then earns a return, too.

For a comparison, think about a snowball. As you roll the ball through the snow, the surface area gets bigger. The more surface area on the snowball, the more snow it picks up. The snowball gains mass slowly at first… but pretty soon, it’s so large you can’t stop it from rolling.

Now, you have probably heard that analogy before. But I don’t think it drives home just how crazy it gets when you’re able to compound wealth over a long period of time.

Because in reality, compounding does more than cause money to grow. It also causes the time you need to make money to shrink!

Imagine saving $10,000 every year and earning 7% compound interest.

The blog Four Pillar Freedom provides an exceptional chart of how this looks in action.

It will take you 7.84 years to crack the $100,000 level this way.

A long time!

But look what happens next…

With the same investment and interest rate, it only takes 5.1 years to get the next $100,000.

Over time, the gap between $100,000 increments becomes shorter and shorter.

Although you’re still investing $10,000 per year, the money you’ve already saved has continued to compound.

By the time you’re going from $400,000 to $500,000, it only takes 2.5 years.

If you crunch the numbers, it takes more time (7.84 years) to go from $0 to $100,000 than it does to go from $600,000 to $1 million (6.37 years).

Isn’t that incredible?

That’s the hidden power of compounding.

Compounding does more than generate money faster and faster.

Compounding actually buys you more and more time the longer you take advantage of it.

This chart also shows why Charlie Munger was so adamant about scrimping and saving to get to your first $100,000 invested…

Because after that? It’s when compounding kicks into full gear, and your wealth goes crazy.

But the key to get there, as with most things, is consistency.

If you haven’t been putting aside any money before, now’s the second-best time to get started.

– Sean MacIntyre

Click here for a great video lesson on investing from Sean. 

And check out his YouTube channel here.

Worth Quoting

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“Wrong decisions are part of life. Being able to make them work anyway is one of the abilities of those who are successful.” – Warren Buffett

Fun and/or Interesting

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Five Quick Bites 

* Interesting. How Ronald Reagan reacted to “mostly peaceful” student protests. Click here.

* Fun. The Hobbit read in what is apparently the style of a BBC Radio 4 Shipping Forecast. Click here.

* Interesting. Did you know that the FBI has a “Head of Diversity?” Click here.

* Interesting. Dubai experienced unprecedented rains a few weeks ago. Click here to see what the flooding looked like from space.

* Fun and Interesting. Click here to watch the Boston Typewriter Orchestra in action. (Imagine these guys, typewriters in hand, assembling every Tuesday night at one of their homes to practice.)

Photo of the Week

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A lion at Luján Zoo in Buenos Aires, Argentina 

The zoo provides a home for animals rescued from circuses, animal trafficking, and private collections. Losing its main source of money due to the effects of the pandemic led to its closure. Only the owner and one employee now care for the animals.

Readers Write

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From Steve Leveen, following the publication of my piece on bilingual children in the May 1 issue: 

“Thanks for this story. I’m delighted that Nazario has his family here, as I thought they were still back in his country.

“You express an oft-told story of precocious children impressing adults with their linguistic powers. The stories are true, but they can also serve to discourage adults from attempting to learn another language themselves, believing that it’s too late for them. And that’s a pity since it’s based on an incorrect interpretation of what you’ve described.

“What these young children are displaying is not the power of children but the power of humans. We all are born with the ability to learn multiple languages and can continue to do this throughout our lives, until the onset of dementia.

“What children have over adults are two things. First, they have exceptional hearing, which begins to decline as early as our late teens or twenties. Second, they have time. Adults are busy doing adult things, whereas children are devoting all their waking hours to hearing and repeating languages. If adults spend comparable time in similar language immersion situations, they generally make faster progress than children.

“And finally, children talk like children. What often amazes adults is how children can communicate well with one another, and with adults on basic topics, often with refreshing and even clever language use, but they have nowhere near the language abilities of adults who have tens of thousands of hours of language use, so that they include idioms, quotations, literary references, evoking of popular culture, etc. They also talk with other adults about abstract concepts out of reach of children.

“So, let’s enjoy these little humans and marvel at their growing language skills, but instead of being discouraged, be reminded of the skills we all have.”

Postscript

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“Being Liberal Isn’t Fun” 

I’ve said before that the best humor is that which unites, not divides. In the past several years, many of America’s best-known comedians have ceased performing at college campuses for fear of telling a politically incorrect joke. Because a second standard I have for great humor is that it must be brave enough to address difficult subjects, including political and social biases, I’ve developed a prejudice against those that were not attacking the Woke Left.

Last night, I came upon this stand-up routine by Andy Haynes, and he proves me wrong. He addresses some hot-button issues – from a liberal’s perspective – and yet, he’s really funny!

Enjoy!

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