Economic development requires a community-based willingness to secure income and invest it into above average assets and sectors with leverage, then structure and engage programmatic methodologies to give it all away to low income, low wealth people from economically disadvantaged families so they can do the same.
It’s a simple two-step cyclical process: commit to build wealth (step 1), and give it to others (step 2) who agree to steps 1 and 2. No advanced calculus here.
On the wealth building side – prior to philanthropic investments – bold yet ‘common sense’ personal decisions can be made, to capture income and investment returns.
The average big company generated a 12% return yearly on average.
Obviously, ‘above average’ companies generated more than 12% yearly.
Don’t believe the detractors who decry investors will ‘never’ find above avg companies or be able to achieve above average returns.
The ‘ability’ to find and invest into above avg companies moreso becomes a CHOICE – not unlike taking the option (choice) to only buy healthy groceries.
With leverage on above average assets even greater than 12% returns have been possible.
Options are highly leveraged investment vehicles. They’re commonly split into ‘calls and puts’.
Calls – go up when the underlying price goes up.
Puts – go up, when the price being traded, crashes.
TSLA stock, ran up from under $200 to over $900 a share over the past 12 months.
That’s over a 4x run up, on the un-leveraged TSLA share price. But there are options ‘contracts’ that ran up 800x.
With stock options, it’s like billiards (pool) – where players call their shots. “8 ball, corner pocket”.
Similarly, with stocks options, investors have to forecast that the price is going to hit, ‘x’, by ‘x’ date.
So, we can study history, to know best case scenarios.
TSLA was around $250, in August 2019.
Hypothetically – – anyone could have said to themselves, “I think TSLA is going to $600 by june 2020”.
Upon structuring the deal properly, there are TSLA options contracts that ran up 1000x, turning $1k into $1m in less than 9 months.
Idealized methodologies are reviewed here.
Another good example, to study with 20/20 hindsight.
Nvidia makes computer processing units, such as those used during the crytocurrency boom and bubble.
From 2016 through 2018, NVDA stock price led the broader market to new highs and heights, with the share price moving up 10x in 2-3 years.
Meanwhile, highly leveraged options were perfectly accessible, to generate returns many magnitudes higher than 10x over the same time period.
Importantly, these are techniques ANYONE can study and learn – – even starting from middle school.
Arguably — even middle school… no, ESPECIALLY young school children from economically disadvantaged American households must be taught how to access these investment vehicles.
Federal minimum wage is just over $7 hourly meanwhile the typical American family home costs $245k today with ongoing minimum utility costs at 1% of the home value yearly, an unlimited bus pass is $600 yearly per person, and food is $2500 yearly for each thrifty adult.
Click to access CostofFoodJan2020.pdf
Since food, transportation, and housing aren’t free, *for mere survival*, children from families who are at highest risk of obstructed access to economic opportunity MUST be taught how to quickly and immediately access at least the minimum wages ($14k yearly) starting at the youngest ages legally permissible, and leverage that income in non-racialized markets, to lift their families and broader communities OUT of the economically disadvantaged category.
Over the past century, stock markets and leveraged vehicles such as options, have been one of the ONLY markets yet available that require no identification of one’s racial or ethnic background to participate.
Understanding these leveraged investment vehicles and PRACTICING using them for years PRIOR to the legal working age is of utmost importance.
AFTER building wealth, THEN can spend the rest of life acquiring knowledge on and building a practice in medicine, law, engineering, politics…
Most important of all, can prioritize actively deploying personal assets and wealth to lead community-driven economic development programming.
Investors buy options on other financial instruments too, such as ETFs like GLD, which ‘reflects’ the price of gold — to be bought with supportive (backtested) macroeconomic picture and supportive ‘valuation’ at the entry decision.
Other leveraged instruments exist beyond ‘options’, such as ‘futures’.
Lastly, alerts (accessible via SMS or email), scans, and filters can be constructed to help identify these opportunities; which are built by studying these retrospective, 20/20 hindsight, best case investment scenarios. These alerts can be backtested and adjustments made to improve their performance.
In a quest to lead highly efficacious community-driven economic development programs, take on a personal challenge and make a personal commitment to learn more about using leverage, finding strong trending prices, macroeconomic indicators, valuation strategies, and learn how to build alerts, scans, and filters.
Information on these topics can generally be found online and in books at the local public library, which comes at no cost, as always. Instructional materials are available from many reputable sources, such as stockcharts.com or finviz.com, which provide freemium product offerings and for an upgrade they offer handy tools for under $400 yearly.
pH14 Plan offers ‘predefined’ alerts and scans and filters, and links to macroeconomic indicators and valuation tools…
ALL are welcomed and invited to access these tools, for an affordable yearly price, generally priced at less than the cost of the average phone bill.
Register today for access, to learn about various investment methodologies and more broadly, adopt evolved philosophic perspectives on best practices for economic development in America.