Thursday, April 22, 2010

Millionaire man's recovery

Lately I have been finding ways to acomplish the objective of one million euros in less than five years and I see a trend in brand Stores all around the world, stores that are doing more than well, sales rising, while those stores aimed at the middle class and lower struggle. Here's what that means to the economy, and investors.

The high-end yachts are doing much better than the small wooden boats to put it this way.

Recent shopping trends show that the wealthy are living it up again -- spending on expensive jewelry, luxury handbags, designer clothing, nice cars and other high-end pleasures. But the recovery has done little to boost the spending of the average wage earners shopping at places such as Target in the US and Alepa in Finland.

The reasons for this dichotomy are quite simple, reflecting overall trends in the economy:

* First, the world is still out of jobs that vanished during the recession. One in six people is out of work, and many who have jobs are worried about losing them. Though job losses have hit every level, the wealthy have bigger cushions to fall back on.

* Second, the stock market has rebounded sharply; it's up about 60% from the lows of a year ago. Driven by this, household net worth advanced significantly at the end of last year. The benefits tilt strongly toward the wealthy, who have proportionally more of their money, and simply more money, invested.

The world's point of sales terminals show the impact of this as well as anything. Wealthier people feel confident enough that they've started shopping again, boosting sales at higher-end retailers such as Tiffany, Nordstrom and louis vuitton to name a few.

Here's something else that helps the wealthy: Though hiring is scarce, executive bonuses are flowing, and they are definitely back on Wall Street after falling sharply in 2008. And sales at Tiffany's flagship store in New York City shot up 20% over the past holiday season and up 15% in louis vuitton store in Helsinki.

Working middle-class families, meanwhile, remain antsy about spending. And sales at the places they generally shop, like Target and Wal-Mart Stores in the US and Dressman and Alepa stores in Finland continue to languish.

Although the recovery was meant to lift the economy as a whole, the effects so far have been felt mostly by the wealthy. The wold is presiding over a Millionaire man's economic rebound.

There's definitely a recovery in the upper end you can see it, the affluent consumer is really more confident that the worst is over. The lower end is really suffering badly, and I don't see any great turnaround there at all unless we get the necesary confidence to continiously start investing.

If you still need convincing that this is a Millionaire man's recovery, take a look deeper into shopping patterns over the past several months. Sales at stores open more than a year are the best measure of shopping trends because this strips out the effect of store openings.

At Nordstrom, where shoppers can drop $2,500 on a variety of Versace New Couture handbags or $1,295 on a Burberry pleated trench coat, sales at stores open more than a year were up 10.3% in February. January was even better: Sales advanced 14%. Fourth-quarter sales increased 6.9% from a year earlier, driving earnings up 152% to 77 cents a share. All of this came despite Nordstrom's heavy exposure to economically hard-hit California.

At Louis Vuitton, where scarfs in a new line named Helsinki changed from €350 to €390 each but the pricier ones cost €500 or more, sales of handbags and accessories advanced 15% in the most recent quarter. This helped Investors buy back more shares, enriching shareholders even more.

In contrast, sales at Target, where handbags start at $8 and rarely run above $30, sales have barely budged, up 0.6% in the most recent quarter. In Alepa sales recovered a bit for a 2.4% gain in February due to a 24 hour open store. Tellingly, sales that month were strongest for food, household essentials and other basics. Spending on discretionary items such as apparel and decorative items for the home were flat or down in February.

At Tiffany, where the wealthy shell out $6,500 apiece for the high-end jewelers' popular "Petals" key pendants, U.S. sales were up 12% in November and December, and worldwide sales were up 8%.Things are going so well that Tiffany upped its dividend to shareholders by 17% in January.

Compared with a year earlier, Polo Ralph Lauren saw its cash levels double in the most recent quarter to $1.3 billion, thanks to a healthy sales increase of 6%. In contrast, at Dressman, where men's shirts go for €10 to €25, sales dropped 4.5% in the most recent quarter.

Take a moment to see the big picture and you see more signs of this dual-level rebound in the economy:

* February sales of luxury items (excluding jewelry) were up 15.2% from a year earlier, according to MasterCard Advisors a division of the credit card company MasterCard that tracks consumer trends. In contrast, overall retail sales were up about 4% last month.

* A February survey by credit card company Discover Financial Services indicated that 36.5% of people earning more than $75,000 a year believed the economy was getting better, compared with 24% of people making less than $40,000.

* The more affluent were making more shopping trips than the less affluent throughout 2009 and early 2010, according to James Russo, the vice president of global consumer insights at Nielsen.

* The wealthy appear to be spending more vigorously on housing, because the prices on high-end homes have held up better than prices at the lower end in the US making this an exclusive exception in the Finnish market in which small apartments are selling more lately.

* while companies cut back on bonuses last year, the reduction hasn't been that great. Based on a look at 232 publicly traded companies with more than $1 billion in annual sales, bonus pay dropped 12.6%, on average, to $812,799 from $930,133 in 2008, according to Equilar, an executive-pay research firm. Bonuses grew sharply at financial companies -- to an average of $576,294 in 2009 from zero the year before.

"At this time last year, high-end consumers were in panic mode, and they really pulled back on spending," says an economist. I think they have exhaled. The stock market is up 60% to 70%, and the housing market has stabilized, so they feel much more comfortable and are starting to spend more.

In contrast, middle- and lower-income households are earning less, saving more and worrying about their jobs.

As an investor, the key is to remember that this economic picture may soon change.
there could be much more upside for stocks overall despite the yearlong rally. Many investors still expect a "new normal" ahead an extended period of moderate consumer spending and subpar growth. If the next months we will see broader growth, that'll finally lift all boats.

You could find a lot of life left in the stocks of high-end retailers such as Tiffany, Loui Vuitton, Polo, Ralph Lauren, even though their stocks have all doubled or more in the past year. They now trade near their average price-to-earnings ratios over the past five years. That suggests they are not great deals now. However, that will change if the wealthy keep spending more, driving up nice cars and accelerating revenue and earnings and here comes a final idea How the Millionaire man's got there in the first place?

The answer might be simple but is not I might say they got there by Compounding, the return from an investment that includes the effect of dividends or interest added to the original sum. Thus the compound rate of interest on a savings account assumes that periodically interest earned is added to the original principal and future interest is earned on both principal and interest earned. In most investment calculations, compounding periods are a year but compounding periods can be for any lenght of time. The compound rate of return and here is the trick... is the geometric mean.

"Compound interest-the greatest invention of all time"-Albert Einstein.

To conclude this post I have to mention that I found a hobbie that could make me reach my objective sooner than later appart from Investing lately I have been learning some tricks at the wildest pocker tables(therefore see the next video of Patrik Antonius a finnish pocker player)...the objective is here and will become my my next post I will Introduce a resemblance of a Mexican friend living in Helsinki giving a diverse opinion on how to Become Millionaire meanwhile Post your comments..questions...suggestions but among all ENJOY!!!

Monday, April 12, 2010

Millionaire Here and Now

This post is about a major shift in my way of thinking that occurred a year ago, a shift that caused a dramatic improvement in my enjoyment of life. If you’d like to experience more joy in your life right now instead of merely hoping things will get better in your future, you might find my story helpful.

During February 2009 I was developing and implementing payment applications in the payment industry in which I still work at the moment, then one of my goals and the reason of this blog was to become Millionaire in less than five years. I figured that would be a very positive goal to achieve, one that would give me a lot more freedom, one that would really challenge my past objectives and the general perception of wealth. However, I noticed that even though I was working in a good industry, I wasn’t enjoying much freedom in the present. I had to answer to customers, directors and other stakeholders. I had to meet deadlines set by others. And I had to do many tasks I didn’t particularly like. When I gazed into the future, I saw the potential for wealth and freedom, but in order to reach that point, I would have to endure a definite absence of those qualities in the present.

Initially this plan of delayed gratification seemed sensible and intelligent to me. Shouldn’t I make sacrifices while I’m young in order to create a better future for myself? Wouldn’t it be great to become a Millionaire in my 30s?

But something about that mindset didn’t sit right with me. My intellect liked it, but my intuition kept fighting it. I experienced a major head-vs-heart battle as I pondered the issue of sacrificing freedom in the present in order to achieve supposedly greater freedom in the future. I figured it was just a matter of discipline and self-sacrifice and that in the long run, all my efforts would pay off. But after just a year of hard work and encountering some major roadblocks along the way, I felt like I just wasn’t getting any closer to my goal. It always seemed to be just a few more years away.

While organising my old bookshelf I found one day not long ago, certain book a book that practically jumped off the shelf at me: a book of my all time favourite Mr. Gurdjieff. I had such a strong intuitive sense about the book that I just read it again right away.

One if the main ideas of the book is the: "Here and Now" that simple idea continues to swirl about in your consciousness weeks after you’ve read it. It left me permanently changed.

The basic principle of the book is quite simple — nothing exists outside this present moment. But that’s a very different way of thinking than I was used to. I used to think of my lifetime as a line segment from birth to death. The present moment was a single point on that line moving slowly forward. The past was the part of the line behind that point, and the future was the part ahead of it. After reading Mr. Gurdjieff again and again and again, I stopped thinking of my life in this way. I finally understood that this model was extremely disempowering.

The Here and Now taught me that there is no line segment. The point is all there is. The past and the future are illusions. They only exist to the degree we focus our attention on them right now. We create the past and the future by imagining them in the present. But we don’t even exist outside the Now.

This might seem like just a semantic difference, perhaps even an erroneous one, but it was a radical new way of thinking for me, and I was eager to test it. As I grasped the idea that nothing exists outside this present moment, I turned my overall life strategy upside down. I understood that if I am to experience anything in life, I must create it in this moment, so here it comes Millionaire Here and Now!. It must exist in some form right now, or it doesn’t exist at all. So the idea of creating freedom and wealth in the future by constraining myself in the present was nothing but a fool’s errand. That future would never arrive as long as I was creating confinement and scarcity in the here and now. The future is certainly a convenient mental construct, but I found that projecting too much of what I wanted into my future was hurting the enjoyment of my present. What’s the point of working to create a future of joy and freedom if my present reality is just the opposite? If I wanted freedom and wealth in the future, I had to seed its creation right here, right now. The only power I have to create anything is here in the present. I adopted the mindset, “If it doesn’t exist in some form right now, it never will exist.”

This shift in thinking produced a significant shift in my priorities. I began focusing more of my energy on improving the quality of my present reality instead of projecting all those improvements into the realm of someday. I started asking questions like, “How can I experience more joy in this very moment?”

Some basic changes in my attitude have been taking place in my way of living I eventually stopped doing what I dont like and shifted my focus to personal development. Why? Largely because I enjoyed personal development more than anything else. I got rid of some projects and began working more time from home. I stopped doing deadline-oriented project work and started blogging and writing articles I could complete in a single sitting. I started taking more time off. I began doing more things I enjoyed, such as exercising, reading, meditating, and spending time with my wife and my son. I became less stingy with my cash and began spending it more liberally when the situation warranted.

I was initially concerned that focusing too much on the present moment would make me shortsighted. But my experience has been just the opposite. I’m still able to make plans for the future and work on long-term goals. In the past I would set goals because I believed that achieving those goals would increase my happiness. But now the flow goes in reverse. Today I set goals to increase my expression of the happiness I’m already enjoying... including the money.

With this personal development business, I also want to keep building web traffic. But now it’s mainly because I’m so passionate about the work I’m doing that I want to share it with as many people as possible. Again, the flow has been reversed. I don’t look to this business to make me happy. I look to this business to express my happiness outward and to share it with others.The big irony is that my future is in much better shape even though I focus most of my attention on the present. By making my present reality as enjoyable as possible, my motivation has just been soaring. I’m working from a state of joy instead of a feeling of obligation. I write because I enjoy writing, not because I feel I must keep writing in order to make money. If I don’t feel like writing, I don’t write. Whenever I feel like taking several days off, I do that, In fact in a couple of weeks I will take a trip to Amsterdam to visit some great friends from the past to mantain my present alive

I’ve actually created the very situation I was hoping money would someday grant me. I imagined what I would do if I was already rich beyond my wildest dreams. I saw myself spending lots of time working on personal growth, doing all sorts of interesting experiments, and then sharing what I learned with others. I thought to myself, “That would be a truly incredible life for me.” But instead of waiting to become rich first, I decided to find a way to make it happen right now, even if I’d only be doing it for free in my spare time. I realized that telling myself I would do certain things after I was rich was just an excuse. Do you ever catch yourself saying, “Someday when I’m rich, I’ll do X”? Deep down you know that it isn’t a lack of money that’s holding you back though — it’s just fear. Why not find a way to do those things right now, if only on a small scale?

This line of thinking produced some amazing results for me. Even though I don’t have millions of dollars in the bank, I feel like I’m already living the way I would live if I were financially set for life. If I won $100 million in the lottery, I’d keep doing what I’m doing right now. The money would simply expand my capacity but not the essence of what I’m doing. What would you do if you were already set for life? Figure out what that is, and find a way to begin doing it on some level right now.

Today I’m so happy it’s almost ridiculous. I couldn’t even have imagined being this happy on a daily basis a year ago. And I certainly wasn’t depressed back then — I was at least content. But now my default emotional state is highly positive, not just neutral. I stopped seeking happiness in the future and instead looked for ways to create it right now.

I’ve noticed that the happier I feel, the less attached I am to outcomes. Instead of trying to acquire money, possessions, or other externalities, my focus has shifted to self-expression. I have a burning desire to create. Instead of having a craving to eat, it’s like I have a craving to cook. But of course by focusing on expressing instead of acquiring, I end up doing the very things that enable me to easily acquire whatever I want. Really I’m just doing what I love most. Infact I was talking with a colleague from the office and I was stating the simple idea that the biggest pleassures in life are FREE, (just deep inside think about it)

How do you feel about your life right this moment? Are you gushingly positive and overflowing with passion?

Or do you find yourself stuck in the same situation I was in a year ago, sacrificing your present happiness for the hope of a better tomorrow? How is that strategy working for you? Are you becoming significantly happier and more fulfilled with each passing year? Or are you just running on a treadmill while trying to convince yourself that someday things will be better?

There is no someday, you know. There is only right now. If your current life path isn’t a joyful one, turn around and take a different path. Other people will probably whine about your decision — no one on the treadmill of unhappiness likes being reminded that it’s possible to get off at any time. Of course I´m still after the Million but now it´s clear that it is not my Everything because maybe the seed of humanity was harvested on earth for other purposes...

Keep the attitude and I will be glad to read your comments. ENJOY AND SMILE!