Chapter 17 [The gap between rich and poor is determined not by funds but by assets] Part 1 of 3 - How tenant farmers become landlords and workers become capitalists

Source:https://www.facebook.com/100063294665283/posts/543574547762363/

[James: Origins and Today] Chapter 17 - The gap between rich and poor is determined not by funds but by assets, Part 1 of 3 (03/09/2023)

How sharecroppers became landlords and laborers became capitalists:

When ordinary workers work hard and earn a meager salary, they cannot make people rich. Funds are currencies issued by the state, and every country is issuing more banknotes. If you keep them, they will become less and less valuable (you have to work to obtain banknotes, and the US sovereignty can print money at will. Isn't there a problem if you still hold the US dollars?). Therefore, ordinary workers only know how to store the funds earned through labor in bank fixed deposits, insurance, and annuities. The result is workers who have been deprived of money twice.

‘

Regarding the fate of production, manufacturing, and export in emerging countries, we must remember that although we were poor at the beginning and worked as laborers to earn meager wages, we must invest the funds earned from labor in U.S. stock index funds and be American bosses. Although we OEM for Apple, at work, American companies are the bosses of Taiwanese OEMs, but when we invest in the U.S. high-tech index fund QQQ (Taiwan code 00662. Included in Index Fund of the 100 Largest Companies Listed on Nasdaq) We are investors and shareholders of these 100 companies. We have become the bosses of 100 companies in the United States. Although we work hard for these companies, we can still be the bosses of these large companies and share the profits of these companies. This is why we all have to abandon cash and exchange cash for assets. Only then can the assets increase our wealth for us.

This means that workers must take up the gun of capitalism, take back our autonomy, and exchange funds into assets so that we can control our own destiny. Just like most people only know how to exchange funds into real estate (it’s just one person making their own money, and the older ones plundering the assets of the younger people). Although it is the same way to obtain capital gains, it is still not as practical as investing funds in American index funds, becoming the boss of an American company, and making American money.

I often say that a person's wealth has absolutely nothing to do with his career or his income, but is related to his investment and financial management. When you can invest one hundred US dollars ($3,000 Taiwan dollars) a month for forty years. Many people will be frightened by forty years, but in fact, 2/3 of the total assets are grown in the first ten years, which means you have one million US dollars (NT$30 million) in assets for your retirement fund, of which US$700,000 (NT$20 million) is the increase in investment from the first to tenth year, and only US$300,000 (NT$10 million) will be added in the next thirty years. So the earlier you invest, the better the results will be. A young man who invests ten years early will have more assets than another young man who invests late, even if he only invests for ten years. Therefore, investing as early as possible is an important key factor in getting rich. When you can prepare two hundred U.S. dollars (NT$6,000) a month to invest in U.S. index funds, you will have two million U.S. dollars (NT$60 million) in assets for retirement. So no matter what your job is, as long as you work hard and continue to invest, you will have a rich and happy life. "Wealth is a gift, happiness is a human right!"