At least, that is what happened to me yesterday.

To be honest, I feel the economic pressure.  Too many of my shortterm insurance clients lost the financial battle and I battle to replace the lost income.  I feel depressed for my clients and I feel very despondent about myself working very hard just to keep my position.  In fact, yesterday morning I felt very sorry for myself.  Not a good place to be.

And then I got an email that reminded me that Bill Gates and Warren Buffett and Richard Branson (the last two definitely on my hero list) did not start out with a lot of money.  In fact, almost no billionaire did.  So I did not really relate to those guys, they are too far removed from me.

But I can relate to a couple of other guys that I know.  In fact, I know one or two who had to start fresh on the wrong side of zero.  I am far from that.  But once again, I also had to start from scratch, or almost scratch, before, and look where I am now.  And I am working on it.  I am learning. Tomorrow I attend a wealth seminar.  There are positives!

And that is when I told myself I should not allow the negative news and negativity surrounding me get to me.  I must just keep on doing what I am doing.  I get impatient, because I have not achieved my goals for 2011.  But I am still doing a lot better than the clients who lost their businesses!  I feel depressed, because I will not be financially free when I planned to be.  But, what the hell, I enjoy what I am doing!  I enjoy servicing my shortterm insurance clients.  And they appreciate it.  I love teaching people about property investments (I hope they appreciate it, too).  Why would I get depressed if I have to wait a year or two longer to be able to say:  I have reached my goal!  Its not as if I planned to stop working!

And, although I will not expand my property portfolio this year, I still have it and it is still working.

And I share this with you, in the hope that, if you also feel despondent and like throwing in the towel, like I did yesterday morning, this post will have the same effect on you as the reminder:  almost all billionaires started with nothing.  And the road to the top is never level or downhill.

Focus on the big picture and the positives! Have a very good day.

As I have explained in my posts about the World in Aug 2011, when Nixon declared the US$ an unbacked currency and severed the ties to the gold standard, it was like giving governments a blank cheque book with full signing power!  The result of that act is an amazing pile of debt world wide that is threatening to devour us.  Or, as Proverbs says, the borrower is the slave to the lender.

The real world effect of this debt is that the citizens became the slaves.  Citizens are taxed to just pay interest on debt.  Repaying the debt has long ago become a forgotten goal!  And as I also said earlier, the only way to sort of keep the wolf from the door, is to have controlled inflation.  And inflation means that the purchasing power of my money is eroded.  I see it every time I walk into the supermarket!  Everyday I can buy less with R100 than the day before.  That’s inflation at work.  We get a salary increase to counter inflation.  Good news for the government – they can tax me more.  But the supermarket staff now also earn more, so the owner has to increase the prices to keep his profit level.  So up goes the prices and now I earn 10% more, but I can buy 15% less than before.  That is inflation.

Let’s look at it another way.  Suppose we had unlimited cash available, what would happen to prices?  It would sky rocket.  In Economy it is the principle of supply and demand.  So prices will stabilise at a balancing point where cash and supply is more or less in equilibrium!  That is inflation.  That is what happens when governments keep on printing paper money. 

And that is why cash in the bank is not such a good idea to invest.

The question then, is how do I protect my money or my wealth?

That is where gold enters.  Gold has a use in jewellery (as all men know who know a lady) and also in high end electronics.  But ever since Adam walked the earth, gold (and silver) was also used as currency.  Gold does not rust or deteriorate. An ounce of gold 1000 years ago is still an ounce of gold today.  Or, to use Zimbabwe with its super inflation as an example, and ounce of gold before Mugabe became president will still be an ounce of gold when he dies! Unfortunately it is not the case with the Zimbabwean Dollar.  Which is virtually worthless.

But, if you had that ounce of gold before Mugabe, and you still had it today, in cash terms it would be worth much more than before Mugabe.  As the value of paper money depreciates, so the cash value of gold increases!  And today you should be able to buy more or less the same with the ounce of gold.

Also keep the following in mind:  if you had a container load of Zim$, who would it exchange it for you?  I use the Zim$ as an example, but it has happened to other currencies too!  There are even people who think it will happen to the US$!  So we rather keep gold!

Also, I can exchange gold anywhere in the world.  And a small piece of gold jewellery can be a good asset if I have to move to another country.

And all of the above explains why the gold price is so high. (And a good argument to buy more gold jewellery!)