Lucid Living

Speed Reading for the Digital Age

2011-08-13T10:48:00.000-07:00

There is so much useful information out there for anything you want to learn about. Take Surfing - I found 2,530 books on Amazon with a search, and 187 MILLION pages through Google. Obviously there is so much, you couldn't read a tenth of it. So out comes the reading wisdom:

Audio books during your commute makes Auto University.
Speed reading classes or techniques will help you cover more material.
The fastest way to read a book is to not read it. Be selective, and be willing to toss a mediocre book aside.
Use recommendations to get the right one. Amazon reviews are great for this.

All of these are useful, and all of them I use. However, I've just found a new way to cover some literary ground - online book reviews. Especially in the case of books with action plans, a certain list of main points, or a few key ideas, book reviews could give you the outline, a feeling about whether you want to read, or it could really give you the whole book! Let's look at a few examples, quickly culled from Google.com.

Covey's 7 Habits of Highly Effective People: this one seems a little sparse, this one takes some work through their links, and this one gives you most points in under 10 minutes!
Your Money or Your Life: this one has the key points, but is a little light on details, where this one goes into more details (lists key questions, etc.), and this one is a feel for the book with little or no actual content.
The Celestine Prophecy: wikipedia and goodreads came across as far too brief to replace reading. Wiki seemed good for follow-up information, and goodreads only an indication on whether it would be worth your time. This review is more typical for a somewhat opinion book like this - either you like it or you don't, and cherry-pick facts to support your opinion.
The Millionaire Mind: two good reviews, one a little more free-flowing and one more a breakdown of the book. Interestingly, the second review states that reading chapter one gives a good 'short version' of the whole book, my goal here. I wonder if he used it as an outline for his post?

I simply typed in 'book review' and the name of the book for each. I looked for common blog names, stayed away from sites like Amazon or stores, and learned (in the process) to avoid popular book sites like goodreads, and wikipedia.

In the course of writing this article, I now feel like I read two books and re-read another. Celestine Prophecy mostly felt like a wash, and I wouldn't recommend using this method for books that aren't presenting a system - how to save money, create a business, travel, etc. Stories, biographies, new age or religious books all lose a lot in abridgment.

So what is the best way to use this method? Find or create a list of books you want to read that can be summed up, every day pick two and search for a good review or two, then go through them or save them on your Reader of choice for later that day. In a month, you've absorbed 50+ new books, and found 2-3 must-reads to maybe buy!

If you're looking for financial reads (probably the best application of this method), find a blog that lists their top books, and work your way through the list. I kept coming back to The Simple Dollar for great reviews, so I am heading over there now to look for his list of recommendations - especially if he reviews many of them. I expected to find more from Get Rich Slowly, but was having trouble loading the page. J.D. has a great site (disclaimer - we went to school together and I wrote a book review there), and a booklist here.

As The Millionaire Mind asserts, personal development works. The more you read, and the more efficiently you use your time, the more successful you will be. Take advantage of what's on the web, and build your success faster.

Mark Cuban's Personal Stimulus Plan

2009-03-11T07:00:00.000-07:00

This is too interesting a story to pass up. Have you got a good idea for a business? Do you have a business already that's ready to go to the next level? Introducing Mark Cuban's personal Stimulus Plan. For those of you who don't know, Mark Cuban is the owner of the Dallas Mavericks, a thorn in the NBA's side (in a good way), and internet billionaire. He's one of my heroes, and you'll understand why if you hear his story. It doesn't mention his big Options play, but that was huge too - I'll write about that some other day...

Mark Cuban is running his own stimulus package. He is looking for interesting companies or start-ups (preference is on the established ones) to invest in. The rules are on the first link I posted, but basically you have to have a solid business plan and be willing to bare it all on his site. This way, we all can see what's going on and learn. I have had a great time reading through some of the ideas. He says he's received over 1,400 of them and read them all. I love this article, because it illustrates several key ideas that we all need to understand:

The rich get richer because they take the time and let good deals come to them. Then they spend the time to make sure.
Looking back, we will see this as one of the biggest opportunities of our lifetime. Sure many people will have a hard time, but many people will come out of these economic times much stronger.
You get rich by creating value. Cuban will be richer at the end of this, but by helping other people become richer too.
Wealth is not a zero-sum game. You can get rich without making other people poorer, and in fact most have. Many of our richest people have enriched the lives of thousands in the process of getting there themselves.

So let's take the lessons of Cuban and enrich those around us, creating our own prosperity on the way. And if you have an idea and post to his Stimulus Plan, put a link in the comments so we can all read about it.

Mine? I'm thinking...

A Eulogy: the Penultimate of Goals

2009-03-03T09:16:00.000-08:00

I just realized that every, and I mean EVERY, book I've read on success, investing, and business always has a section on Goal Setting. It doesn't matter if the author is a steady investor, a speculator, or Rich Dad - they all say that without goals, it won't happen.

Yogi Berra says, "If you don't know where you're going, how will you know when you get there?"

More on actual How To for goal-setting later. First, I want to talk about a part of goal-setting, the Eulogy. The exercise goes - imagine you're sitting at your own funeral. People are getting up and talking about your life and how you affected them, giving eulogies. What would you like to be remembered for? What do you want people to say about you? Write for them - what would you like the following people to say:

Your partner or spouse
Your child
A co-worker or business partner
A stranger, someone who barely knows you

Now, I've thought about this a bit but never really did it. About five months ago, though, I saw the perfect example, with Paul Newman's passing. Read through that article - it's amazing. And look back at the list above.

Married 50 years in "one of the most successful marriages in Hollywood"
Newman's daughters described him as a devoted husband, a loving father, an adoring grandfather and a dedicated philanthropist.
Awards and kind words from co-workers and Hollywood in general, including an Oscar
Some 135,000 children have been able to go to summer camp for free because of Newman's Own

Any one of those would be a great accomplishment. All four, and more!, is absolutely amazing. For more on his entrepreneurial success, read here and this book, here.

So what would you like people to say about you? That you 'got by'? That you 'did okay'? Settling for getting by is aiming for mediocrity. And once you know where you're going, it's much easier to recognize the road signs. It's time to sit down and write out what you want to be known for, and start making it come true.

Lessons From a Global Economy

2009-03-02T11:43:00.000-08:00

For the last two months, I have been working online for a meeting place of employers and providers called oDesk. To see more about my thoughts on oDesk, look at my other blog.

One of the main issues new providers have with oDesk is that you are now competing with people who can live well on $10 a day. They often scream 'Unfair!' and either ask oDesk to set a minimum wage or expect a lot and sit around waiting for it. oDesk isn't about to set a minimum wage, so they sit. And sit. And sit...

Since I'm obviously in the same position - competing with people who can make 1/5th what I can, I did some research in the meantime. One part is that I've been willing to build - one person I read asked why he should be willing to work for less than he gets paid locally. While he's holding out for someone to take a chance that he's worth it, I've already clocked 40 hours. I started low, put in some work, and reference these blogs as much as I can. So first I worked for under $2 an hour, then $10 an hour for one hour's work and a good reference, and now $14. As I learn more about writing copy, I expect this to continue to rise.

The full answer, interestingly though, is to brand yourself and stand out in your niche. I know enough about computers, write well, have been published online and in a magazine in Taiwan, and have some specialized interests and strong points. I've been around computers, but am not an expert - and that's a lot of why I have my current job there. This same idea is true in other job markets, and in general. At first I didn't understand what they meant by "don't be a commodity." Now I do.

A commodity is a thing. Since the same 'things' are pretty similar, difference is made through looking nicer, being bigger, and costing less. So if you want apples, you'll pick the biggest, pretties, and cheapest of a type you like. On oDesk, if you're looking for a basic job done, volume and cost are what you're looking at - a commodity.

On the other hand, if you're looking for a special job - other things become important. The writer's style, ability to communicate and get you exactly what you want, or their knowledge that will predict issues you haven't even thought about yet. All of a sudden, they're paying for services, style, and specialties. And as everyone is different, you're not a commodity - not trying to be the biggest, cheapest apple around. Now, you get paid based on what your skills are worth, instead of the same as the cheapest person out there, because there is no one else to compare exactly to.

As we get into a time of high unemployment, and a market that favors the employer, remember this. Instead of trying to be the best deal around, brand yourself. Get hired because you're the one who's different, and can offer your boss something no one else can. Establish a specialty, and be remarkable. Look at books like The 4-Hour Workweek or Automatic Wealth. Find something that truly sets you apart from the rest, and let them be apples while you're something different. And then get paid what you are worth, not the 'going rate' for a body.

Poll Results

2009-02-28T10:47:00.000-08:00

The survey for January was: What Are Your Plans For Your Money In 2009? The results were all about paying down debt. Now, given there were about five participants, that doesn't mean much, but it is interesting.

There's a concept called 'expensive money', and it's based on how much you have to pay to borrow money - i.e. interest rates. If interest rates are high, you have to pay more to borrow money, and if they're low, you pay less. Talking to long-term investors, the break-point is around double digits. If you can pay less than 10% on borrowed money, it's pretty cheap. If interest rates are higher, it's expensive.

In What Is an Investor, I put forth that an investor is a person who understands ROI, implying that they'll be on the winning side of that comparison. So as an interesting aside - if under 10% interest is considered 'cheap', then that implies a professional investor is confident that they can make over 10% on their investments. Otherwise 'cheap' would have a different level.

Now, most people out there can get interest rates under 7%, and many can get under 6%. This means that money is quite cheap. And yet people are still looking to pay down debt... So this survey tells me two things:

That fear makes cheap money still look risky.
That those surveyed are not professional investors, or have too much debt already.

What Is an Investor?

2009-02-27T12:15:00.000-08:00

It's time for a definition. What EXACTLY is an investor? In this article, I stated that an investment IS a sacrifice. So if an investment is a sacrifice, what is an investor? The best answer I've come up with is that an investor is a person who earns a better return than they pay.

This means that an investor is a person who understands ROI. This also means that a person who buys a house with a 7% mortgage, and makes money renting out the property is an investor. A person who buys a home to live in? Only if that's cheaper than renting. A person who rents out a house for a loss? Not an investor! Unfortunately, I fit into that last example pretty well right now...

That also means that a person who buys stocks and waits for them to go up, or is selling now that they are dropping is NOT an investor. They're speculators, which is another word for a gambler. Same with the person banking on appreciation in their house. Not that there's necessarily something wrong with that, but this site is "dedicated to not daydreaming through life", as I say at the top... Let's see what's really happening here.

Most "investors" are really traders, and that is a game or a job, depending on how they approach it and whether they make money or not.

Funny thing, by this definition, Warren Buffett is an investor - as he buys undervalued assets that will pay a better return on his investment than he is paying (or could get elsewhere). But the people who own his stock (BRK-A or -B) are not, as it doesn't pay dividends and we're just expecting (or hoping) it will go up...

Emotional Costs

2009-02-26T11:33:00.000-08:00

I recently wrote on this article on Get Rich Slowly that "This is the cost of emotion - if you didn’t have that reaction, you could save money." In retrospect, I think that sounded more negative than it should have. In my article last week, Making the Most of Productivity, I put forth that we might want to look at our productivity in financial, emotional, spiritual, mental, and physical areas.

So let's look at the other side: FESMP (an abbreviation of the areas above) costs. As I said, emotion has a cost - in the example, people were willing to give the government an interest-free loan (paying extra taxes for a big refund) because they knew wouldn't manage the money as well. So because of this emotional soft spot (not being able to stay firm in saving that money), they paid in lost interest.

Another example, from the Seven Laws of Money: the author(!!!), a financial planner and author, saved $2,000 by borrowing $2,000 from another bank, putting it in a CD, and paying the loan back. He only lost a little bit, on the spread between the rates, but he's a financial planner, and that's the best he can do??? Emotional cost.

Then I got to thinking about it... People pay for membership in a gym - physical cost. People give money to their church - spiritual cost. People get sick and take days off of work - physical cost. People take holidays to recharge - mental cost. By spending money, we save in other areas, by spending in other areas, we save money. Think of staying late to get extra work done - you make more, but you cost yourself physically and emotionally.

Looking at it now, I can't see an example where 'mind' and 'emotion' aren't being used interchangeably. Should I have two categories or just one?

It would be a good practice to sit back and look at your 'wealth' in each of these areas, and the 'exchange rate' between them. It's interesting that, as we get low in one area, we are often willing to buy it at a premium, and as we get high, we are willing to sell at a discount. Think of the rich man in poor health, and what he'll be willing to spend to be healthy again, or the other extreme - the poor young man willing to work 70 hours a week to make lots of money.

Where are you wealthy, and where are you poor?
Are you balanced?
If you made a pie chart with these five (four?) areas, what would it look like?

Are You the Average of Your Friends?

2009-02-23T22:57:00.001-08:00

"You can judge a person by the company they keep." I've heard this before, but didn't understand it the way I do now... Now I've come across a very interesting statement - you are the average of your ten closest friends.

It was stated about income, but it applies to a lot more. Take a moment and think about your closest friends, and ask yourself the following questions:

Do most of them like to stay out late and/or drink?
What are their favorite TV shows?
Do most of them smoke?
Do most of them like to read books?
What cars do they drive?
What is their average income?

Since, for the most part, like attracts like, I think you'll be amazed at the similarities when taken as an aggregate. Now I think this works both ways - you attract people who have similar interests to you, and you influence them and they influence you. For example, if you went to bed at nine every night, how long would you stay close to people who partied until 2?

How about - how comfortable would you be hanging out with people who made 1/5th the money you did? Or didn't know how to handle money, and were deeply in debt, while you had half a million in the bank? Along the same line, if you were working on a new business idea, would you want to be around people excited for you and with helpful experience, or a group of people who kept finding reasons your ideas won't work?

In Alcoholics Anonymous meetings, they tell the members that they'll have to find a new group of friends. The ones they got drunk with aren't going to help them stay sober. Likewise, if you want to make strides in your personal situation, it's probably time to take a good look at the people around you. Luckily, it doesn't have to mean leaving friends. When I asked a friend about this, his reply was, "Heck no, I'm going to help make my friends wealthy too. Then I'll have my same friends, and I'll still be their average."

Some Things to Consider

Are you the average of your closest friends?
Do you like what you see in them, or do you wish they would change?
Do you honestly believe you can improve while keeping to the same environment?
What can you do to, as Gandhi put it, 'be the change you wish to see in the world?'

Making the Most of Productivity

2009-02-19T10:59:00.000-08:00

This is an extended apology for not writing in almost two weeks.

I have been in a very tight situation financially, and it's making me look very closely at a lot of assumptions I have and things I do. I do believe that everything you do is an outgrowth of what you think you are. When we act in a certain way, it is in accordance with our values - no matter how we act. So by simply sitting back and watching your own actions, you can gain deep insight into your core beliefs. Which will give you the ability to affect those beliefs, automatically affecting change on how you act.

Therefore if I say I value money, but act differently, maybe spending too much, I show that I don't really value money. Action speaks louder than words... Therefore, as we currently are having money difficulties, I see the hint of a belief that interferes with being wealthy. And given my beliefs about money, that will not do.

Thus I have been focusing on the following question:

How much money did I make today?

This has been very powerful, as it forces me to look at each action, and decide what to do based on the return. I have been doing quite a few things that haven't given me the productivity I need to have right now. Thus it is time to change. By asking myself this, or a permutation without the word 'money', I have been able to cut out some things that haven't pushed me forward as much.

Blogging hasn't made me much money yet, so it got pushed back. My jobs - especially online - have been making money, so they got moved forward. Time watching my son has been distracting, so I cut back and made sure the time we spend is more special and personal. I think the quality has gone up in my interactions because of this. I've really appreciated time with the family the last couple days, partially because I've been creating less of it.

Thus the focus has been productivity - financial, emotional, spiritual, mental, or physical. I am working out a system to follow my successes and label my mistakes, like we have dollars for the financial side. See, money is easy. At the end of the day, if you have more than you started with - you are ahead.

What about physical health? What is the 'bottom line'???

Should I Invest #3: ROI

2009-02-06T13:05:00.000-08:00

Question #1 was about your timeframe. Question #2 is about your beliefs. Question #3 is about moving forward or backward. I think that the real difference between investing and consuming is ROI, or Return on Investment. As I said before, Investment = Sacrifice. When you invest, you give up access to something now (usually time, money, or access to some property) for an increase in future value - cash flow, appreciation, more knowledge, etc.

But by this definition, consumerism is sacrifice too. I buy a large-screen TV, I gave up money, and I get a return in value: better viewing, maybe more social interaction as friends come over, and something worth more money. So as a mathematician, it looks like this:

Investment = Sacrifice = Consumerism or
Investment = Consumerism

Is this true? No. One is sacrifice for more and the other for less. At the end of the day, did that sacrifice make you richer or poorer? To do this, of course, you'll have to know what you're actually spending. If you buy a TV for $800 on credit, you could end up spending $1,500 by the time you're done. Also a good thing to understand is the future value of money, which basically says that, all things being equal, you'd rather have $1,000 today over $1,000 in ten years, especially when considering inflation or interest earned.

An investor buys things that go up in value, and a consumer buys things that go down in value. If you borrow money to buy a TV, you're a consumer. If you borrow money at 5% and make 8% on it, you're an investor.

Things to take into account: interest rates, inflation, and taxes...

Some examples
If you take $100 and put it in the bank at 2% interest, in a year you have $102. You've increased your wealth, so that is an investment. Now say that inflation is at 3% - you really have more like $99, so you've lost money!

How about if you can make 8%? Say you're in the 28% tax bracket, now you're really slightly under 6%. If you have a mortgage, you could be paying that down instead, so if you are paying 6% on your mortgage, your money is equally well spent paying down the mortgage or investing it. Or is it? You get a tax break on your mortgage, so you're decreasing your tax savings by paying down the mortgage. Here inflation affects both equally, so we can ignore it.

Now, how about that TV? At 12% interest for putting it on credit now, plus inflation, we're looking at a negative 15% on half of the price. An easy way to think about that last thought - over the length of the loan, you owe on average, half the cost. So our $800 TV ties up an average of $400 over the length of the loan.

Another way to look at that TV - as the latest model comes out, it will be worth less. Now an $800 TV could be on sale for $600 in a year. Supposing you are willing to wait the year, you are looking at this: save $50 a month for a year and you buy it outright. Buy it now, and you'll pay $600 of the $800 + $96 interest, and you still will pay at least $300 by the time you're done with interest. Is it worth $300 to wait a year? Only you can decide, but if we up it by a factor of 3 for a TV worth $2,400 now, it gets a lot more appealing.

A good final point to remember is that money isn't the only way to keep track. Happiness, peace, friendship are all part of that equation too. This is why the final decisions have to be yours and yours alone.

Beliefs Can Literally Make Your Day

2009-01-29T11:42:00.000-08:00

“You experience what you believe, unless you believe you won’t, in which case you don’t, which means you did.” This is from Harry Palmer of Avatar, who has an "interesting" history. Be that as it may, this is an excellent quote on positive thinking.

The underlying idea is that your beliefs create your reality. Now we have to look at 'reality' a little bit here... To borrow from ACIM, I'm going to use reality as the world we see around us, everything separate, and our eyes trusted; and Reality as a deeper truth of metaphysics - everything interrelated and requiring the perception of our intuition and feelings.

So, at the level of reality, your beliefs affect you, not the world. Even here, your beliefs change your perception of and your reaction to the world. Therefore work on your beliefs changes the world for you. Consider an example - 'I can't pay my bills'. If this is your belief, you miss possible opportunities to get out of debt. If someone presents you with an opportunity, the usual reaction is, "I can't pay my bills, how could I afford that!" Thus it has become self-fulfilling by closing your eyes to any other possibility.

At the level of Reality, we are a part of everything around us. If that is true, then we have a strong influence on the world, similar to the influence you have on getting your sister to turn on the lights for you. You ask, and she (probably) is happy to help out. Thus 'I can't pay my bills' attracts more bills to you; it tells money to stay away as this is what you're calling to. As long as you hold that belief, the world agrees. And as soon as you change that belief, the world agrees.

Which means whatever level you live at, beliefs control your reality. And you control your beliefs! By changing your beliefs, you can change your reality. Now, how do change your beliefs. Well, first you have to be aware of them. You can't change what you don't know about. Once you've found a belief, then you have to decide if it's helpful or harmful, and then decide if you want to lose it. Luckily, by looking at how you feel about your belief, you can see whether you want it or not. Notice how 'I can't pay my bills' makes you feel. How about 'everybody in this town drives crazy!' Or try 'this is a beautiful day, and I'm lucky to be here.'

As the adage goes, nature abhors a vacuum. It's nearly impossible, if not impossible, to drop a belief. It's much easier to overwrite one. That's why Affirmations are so popular. You (or a coach, partner, etc) find some belief that isn't working, turn it around into a positive affirmation, and slowly overwrite your initial belief. You can't believe that you are smart and stupid (for example) at the same time, so one will win out. Which one is up to you.

Your beliefs were given to you by trusted sources: parents, friends, teachers, life experiences. Can you be your own trusted source? Maybe, but it's harder. If your teachers told you that you were stupid, you're going to have to work hard to convince yourself otherwise. But you can. Do things you know you can do; challenge yourself a bit and see that you can do things you thought you couldn't; daily tell yourself how smart you are; have an experience proving you are smart; ask your friends to let you know when they see you do something smart. It'll take a while, and we're good at undermining our own efforts, but with work you'll do it.

Then you'll start to see the world differently - through 'smart' eyes. And you'll find all kinds of opportunities to show everyone how smart you are where you used to only see how stupid you could be. As Paulo Coelho says in his great book The Alchemist, the world wants you to succeed.

More on Personal Marketing...

2009-01-27T06:32:00.001-08:00

So I was checking out President Obama's Inauguration Speech on YouTube, and noticed all the hate going back and forth in the comments. Right at the top was this:

moron, or momominnosh, same thing according to Websters

So, my curiosity piqued, I searched Google: nothing. I felt a little nerdy, looking this up, but continued. Nothing when I checked YourDictionary.com or Wikipedia either.

Then I realized what the person quoted was doing - marketing. He wanted to insult the guy, so he puts this up, knowing only a couple nerds are going to double-check him anyway. Momominnosh doesn't mean anything - the only links I found on Google were to this Momominnosh's posts. But since we (mostly) won't question it, the poster could create a connection in our minds of Momominnosh and moron. Who would question it?

So how many times a day does somebody say something that we don't check? How often does some false, misleading, or purposefully malicious thought get into our brain? I remember a lot of little details, and I really don't want 'another way to say moron is _____' in there. I'm glad I checked, as I now don't have that connection.

So how often does some false, misleading, or purposefully malicious thought get into our brain? What can we do about it? How can we go about putting some more positive ideas there?

Taking down the billboards that are the collection of beliefs in my head. I don't want to drive by them any more...

Using Personal Marketing

2009-01-27T06:32:00.000-08:00

Lynn Brem posted a very interesting article on Get Rich Slowly, here. I commented, but think there's more to say.

The Questions
This is actually an area (advertising) we really should be looking at closely. Advertisers spend billions of dollars getting to know our brains, how they work, and how to manipulate them. Some areas of concern that every one of us should have are:

How much of an impact do 'they' have on us? Do hidden images of Pepsi make us thirsty?
What's most effective? When are we at our most suggestible?
What personal differences do I have? Will an ad that makes most people hungry make me sad?
How can I use this to influence myself?

I'm sure #1 has pages of websites already... #2 should have research out there - I'll look for it later. #3 will take individual research by each person. But #4 seems to have some very potent broad applications. People in the self-development arena have been using this for a while. Affirmations, visualization, journaling, and subliminal audio are common enough. But it seems like nothing's changed in the last 30-40 years. What has the latest advertising research shown, and how can we apply that to any aspect of our life?

Two Questions
Which, of course, is two questions. First, where can I find the latest research on advertising and psychology? I'm sure there's some out on the internet. But I also have a feeling that the advertisers would want to keep their 'secret weapons' well, secret. I'm already finding some things like this in Predictably Irrational: The Hidden Forces That Shape Our Decisions, in what Dan Ariely calls Behavioral Economics.

The second question is in the application. Take a look around you for a moment. What does your environment do to influence you? Marketers know - this kind of advertising for that kind of show. X word has been shown to elicit 23% more of a reaction than Y word. Positive response. Negative response... Now, look around again. What does the environment you set up set you up for? How could you improve on the 'advertising' you give yourself? You actually have a huge advantage over advertisers - they have to make something that appeals to the majority without upsetting a minority; you only need to impress you.

Some Personal Advertising my family and I have done in the past:

Put a disgusting picture on the fridge to discourage snacks.
A family Vision and Mission Statement, to put our goals in front of us daily.
Affirmations and Visualizations
Put up awards, for that 'Yes, I Can' moment
No TV in the house, to take away that easy escape. "Books are more indicative of successful people."

I've also talked about morning rituals, to help transition to the next stage. Sit in the car for a moment and think about my intention - getting safely to point B. I get up, drink a glass of water, and try to get some yoga done before checking the stock market. Honor the transition, it's called. But again, I'm just convincing my mind that it should be successful at the task I'm giving it. Advertising.

But what could we do? Knowing ourselves, how could we make a targeted marketing campaign to one? Let's end with some suggestions, and hopefully some more in the comments section.

A short commercial, made by you, to you, about whatever you think you need to hear, that loads when you turn on your computer.
A journal, or at least a couple entries, detailing some achievement you want, written in the past, on how you got it and how it felt.
Does anybody have a theme song? I still run better when I think of the theme to Chariots of Fire.

What else?

Should I Invest? #2: What Do You Believe?

2009-01-24T08:27:00.000-08:00

Question #1 was about your timeframe. Question #2 is about your beliefs. To be a successful investor, you need to be cautiously optimistic. Optimistic because if you didn’t think there was a future, and a better one to spend your money in, you wouldn’t invest. Cautious because if there is any chance you could be wiped out, eventually you will be.

Investment = Sacrifice
You sacrifice something now, usually time or money, because you feel you will get something better in the future. You sacrifice living in this home, and let somebody else live there, so that you’ll have a paid-for home in the future for income or to live in. You sacrifice $1,000 of current spending money for the income it could produce, or the chance that it will be worth more in the future. This is often referred to as Return on Investment (ROI), and a 25% ROI means you’ll get back a quarter of your investment a year – and four years from now, you’ll have your original investment AND your money back out. But you must be optimistic that you will get back your money, and inflation won’t kill your profits, or why would you put off gratification?

The Meaning of Risk
If you have an investment that works 90% of the time, but has a 1% chance of costing you all of your money – you will go broke if you try it enough times. In a more normal world, if you win 55% of the time, and risk even 1/10th of your wealth, there is a 2% chance you’ll lose 5 times in a row – half your wealth! You must be cautious with your money! Warren Buffett’s famous two rules of investing are:
1. Never lose money.
2. Never forget Rule #1.

What Are Your Beliefs?
So what are your beliefs? Do you think the economy will get better or worse? What will the world look like in ten years? Twenty? Will the economy rebuild? Will businesses still be profitable? Will your life be better if you’ve doubled your money over the next ten years? Or will inflation cut money to less than half its value in that time? If you double your money, but the cost of living triples, you’re moving backwards. Take some time and think about these questions:
1. Will things get worse or better in the future? By how much?
2. Will there be inflation, deflation, or high inflation? (2-3% inflation is considered “normal”)
3. Will businesses still be profitable in the future?
4. Will your country’s economy and currency be strong in the future?

a Caveat

2009-01-23T15:50:00.000-08:00

Hmmmm... Let me say something about my psychology. I'm a full-fledged Agnostic - and not just in the religious meaning of the word. The high point of Physics is Heisenberg's Uncertainty Principle which roughly states that in quantum mechanics, we can't know everything because by knowing one aspect, you change another. We can talk a lot about afterlife, but we don't have the senses to know for sure. You can statistically predict what people will do in a situation, but you can't be sure of what any one person will do... So I'm constantly learning, constantly trying new things, constantly in flux. In other words, what I post on Lucid Living is an organic R&D process. Ideas are meant to be tried on, debated, and accepted or rejected based on how they work for you - now and in the future. We're in a process of learning the truth, but have a lot of stages to go through.

What I write is part of this growing and changing process. Help me fine-tune with comments!

Links of the Week

2009-01-23T14:18:00.000-08:00

As I'm writing about investing lately, let me tell you the most important step in investing. Investing in yourself - in your education. Read, think, learn, grow. I read constantly, and look at new ideas and newsletters as much as I can. A great read, if you're thinking of investing is The Daily Wealth, by a hero of mine, Steve Sjuggerud - just don't ask me how to pronounce that! The Daily Wealth is a contrarian newsletter that looks at things a little differently. They have a lot to say, and you can learn a lot reading them.

If you want to build wealth through your work instead, give Michael Masterson's Early to Rise a read. He's built quite a few businesses to impressive proportions and has a lot to say as well.

Another favorite of mine is Van Tharp. With his background in psychology, he is a good person to listen to, on his website, through his trading game (on the website), or his book, Safe Strategies for Financial Freedom. The back of the book is on Risk management - probably the most needed part of any investor's tools. And if you have debt, savings, or your own home - you need to know about being an investor. If you understand money, you can get wealthy; if you don't you, you make other people rich. It's that simple.

Finally, to keep the YouTube tradition alive, I just found this song and have to share. I was listening to U2's Pride to celebrate MLK Day, and remembered this band. I can't believe I found a live version, with some incredible didgeridoo work.

Should I Invest? #1: Timeframe

2009-01-21T08:00:00.000-08:00

This is the first of a 3-part article. With the economy in what I've heard called 'the Sandpaper stage' (back and forth, rubbing out your savings), I've talked to a lot of people about when to get in the market, or whether to get out completely and take the loss.

To me, this begs a bigger question: Should you be in 'the market' at all? To which I have three questions. The first is: What is your timeframe?

****************

It has been said the market is long-term a weighing machine, and short-term a popularity contest. This means that a good company, over time, will show it's fundamentals and be valued for being a good company. Unfortunately, it also means that it could take a long time to show that value, and be all over the place in the meantime. This is why most stock charts look so jagged, up and down. It's also why Blue Chips look smoother - their value has been established, so there isn't so much debate on price. See an excerpt of Warren Buffet's view on this here.

In our current economy, I would say that, to be safe, you need a time horizon of at least five years to be reasonably confident that you'll get to the 'weighing machine' part. If you will need your money in less than five years, you might not want to count on fundamentals alone to choose your investments.

Some History
Look at a graph of the S&P 500 over the since the beginning of 2000: it was at 1527 on March 20, 2000; then dropped and climbed back to 1561 on Oct 8, 2007; then fell again since then, and is now at 827. Which means if you bought an S&P 500 index fund in early 2000, you would have spent 7 1/2 years getting back to your starting point, not even a profit. Who knows how long until this latest drop comes back? Forget five years - from 2000, you're looking at ten years at the least!

Question #1
So the first question to ask yourself is, "What is my timeframe?" Think about it seriously and write down when you'll be needing that money back. Only once you know that can you think about the next step, your belief about the future.

Thank You

2009-01-19T16:19:00.000-08:00

I just finished reading here about a High School friend I haven't heard of since, well, High School. He wasn't a close friend (did I have those in High School?), but on hearing his name, I could instantly see his face, and that quirky fun smile. I could hear his voice. And, while I don't really remember any specific shared activity, he was definitely a good memory of school.

He just passed away last week. At the time I read about his passing, I didn't know who it was, and posted this in response:

Wow, congratulations for having a friend like that! It sounds like he really added to the quality of your life too.

I had a good friend pass away during my first year overseas. His memorial was a marvelous experience. We spent the whole time looking back at his life, all he’d done, all he’d touched, all his friends and family. He was mid-30’s, and had lived more than most people I know.

I guess I’m saying Sparky is where he is now. The memorial is for you and the people left behind. I hope you can help make that another lesson on how to live life for his friends. Compare this life with one of ’someday I’ll go do…’. Wealth is thoughts, not things, and it sounds like he was quite wealthy. Keep your memories of him, and share that wealth.

“Those that fear death are not living life.”

It's interesting how my thoughts changed upon realizing who it was. I still agree with what I wrote, but it's more personal now too. In some ways, it's more true. I don't spare a lot of thought for those now gone, but for my memories of them. As he lives on in my memories, that seems the place to put attention to honor the lessons.

I have had conversations with friends, deep discussions that have opened my eyes to new ideas, changed my mind, or otherwise affected my consciousness - driving down the road alone. We don't fully experience anyone: we make up our minds about them, build up a personality for them in our mind, and occasionally actually act like we're completely on the same page. So 'Sparky' is alive and well - in the minds of hundreds or thousands of people affected by him. That's certainly where my sadness and hurt are right now.

And my joy and appreciation for having known him, and remembering the time I did have with him. Thank you for letting me know you.

Links of the Week

2009-01-16T17:29:00.000-08:00

First up, a Gallup Poll says that more than half of Americans feel they are 'struggling'. I don't know - we're definitely having a harder time than two years ago as a group. But struggling? I've done some traveling, and we still have ten times the stuff most people do. Needing to cut back, sure. Thinking about slowing down a bit and paying off debt, hopefully. But the story goes Adolf Merkle killed himself because he lost half of his $9 billion recently. Still worth $5 billion, so off he goes... Let's try to have a little perspective here, okay?

Next, I'd like to show my appreciation for Heroes of Capitalism. This site has regular (every weekday it looks like) posts on the great entrepreneurs and capitalists, and what they've done for our world. Today, they give props to David Booth, the originator of the index fund. With little of the individual risk of stocks, and less of the costs of a regular mutual fund, the index fund is a base and staple of many investors' portfolios. Great site for inspiration when you need it.

Want books for cheap? Half.com is a subsidiary of eBay, with discount books, movies, and CDs available from other people like you, AND eBay's support and Paypal's convenience. Best of all, you can sell books there too, and build your eBay reputation before jumping into being a full seller there. If you manage it right, you could get your books exchanged for the price of postage.

Last week, I posted on Pandora. The one problem is that they won't broadcast to IPs outside the US. For those of you not fortunate enough to get Pandora, I've found another almost as good - Last.fm. This site also lets you enter a band, and they put together a playlist around that, so you can hear everything like Evanescence, for example. Check them out.

Finally, since I reviewed the book Loving What Is last week, I thought I'd put up a sample of Byron Katie doing 'The Work'.

Poll Results

2009-01-15T09:00:00.000-08:00

My first poll is over. The question was: "What are your New Year's Resolutions about?" And the results are... 2 for Financial, nothing for anything else. Two key points here:

People are concerned about money and the economy. (duh!)
I need more readers...

Hopefully, my new poll will be more telling. Please vote for it, so we can discuss at the end of the month!

Nothing Is Average

2009-01-15T08:11:00.000-08:00

The British TV show Human Footprint found that the average person smokes 77,000 cigarettes in their lifetime and breaks wind 15 times a day. Of course, we’ve also been told that the average family has 2.3 children. Quick poll: who here has 2.3 children, breaks wind 15 times a day, and expects to smoke 77,000 cigarettes before they’re done? The point is – none of us are average.

So I’m amazed when people put so much stock in averages. The stock market fell 34% in 2008 – not my stocks. Homes in the US fell 4% for the year ending with the third quarter, but not in California (-20.8%!) or Texas (+3.2%). And not your house, I’m betting. See statistics are a fine way to get a feel for what could happen on average, but pretty lousy in any one specific instance. So the broad markets were down 34%, but McDonald’s wasn’t (up about 12%).

Diversification is a great way to become average. The point of diversifying is to come closer to average and thus avoid as much risk as possible. One company might crash, but the average of one hundred or one thousand won’t. Probably. One home might burn down, but 20 homes in 12 states won’t. Not at the same time, at least. On the other hand, 2008 was a bad year to be average…

And basically what you’re saying is you think you’re in the bottom half, so you’d be happy to get to average. Wouldn’t it be better to beat the average? Could you do that? Sure. All it takes is a little work. Do some research. Take some time to get to know your market. Get a feel for things in general, and specifically for what you’ll be investing in. Know the best neighborhoods in your town, and buy the worst house in those neighborhoods. Find stocks now that have dropped in price, but increased in fundamentals. Stay away from bonds right now – interest rates have no way to go but up!

Next week, I’ll be writing about Should You Invest? The answer shouldn’t surprise you, but it probably will anyway. Stay tuned.

So who’s going to smoke my 77,000 cigarettes?

Selfishly Self-less

2009-01-14T17:23:00.000-08:00

Dinosaur Comics is a personal favorite that I visit every day now. Ryan, they creator, is sharp, witty and quite wise. I find this comic particularly interesting…

I find it interesting because I think it is universally true. I don’t really believe in evil, and I think that all people are ‘hard-wired’, if you will, for good. I see it in the people around me, and I feel it myself. Here is one of the studies that show when we help people, it releases chemicals that not only make us feel better, they boost our immune system as well. The same happens for the person being helped, and random strangers that merely witness the act!

What we see as bad, or evil, is merely someone with a different viewpoint than ours. I’m sure most of the villains of our time thought they were doing good… And for some people they probably were…

Why do we open doors for strangers, let passing cars in, or help out someone in need? We are rewarded. That is true with everything we do, and some of the best rewards are positive feelings. I disagree with the comic that this is a bad thing. Everything we do, we do it because we are rewarded at some level. If we weren't rewarded, we wouldn't do it. This is a good thing.

Rewarded
Now that you know this, use it. When you're feeling down, help somebody. Allow people to help you, too. Say 'Thank you', and show appreciation to reinforce the good feelings. If you need someone's help, make sure you do your best to help them help you, and reward them with positive feedback and smiles. And make it a goal to help five people every day...

Book Review - Loving What Is

2009-01-09T23:46:00.000-08:00

Loving What Is by Byron Katie was recommended to me when I was having a particularly stressful time around money. I’ve got to say that, while the money problem is still here, my ability to handle the stress has improved greatly – which gives me more opportunity to take control of the situation. And I really do have this book to thank to a large degree.

Byron Katie is a fantastic woman who really has a great view on reality. Basically, the crux of the book is that reality doesn’t cause our problems, it’s our expectations on reality and our reaction to reality that causes the pain. This mean our challenges are in our mind, somewhere we should be able to affect!

What Is Loving What Is?
Loving What Is is based around four simple intended to bring your thinking in line with reality, and thus remove the cause of our pain. The Four Questions are:
1. Is it true?
2. Can you absolutely know it’s true?
3. What happens when you believe that thought?
4. Who would you be without that thought?

Then comes what Byron Katie calls the turnaround – now that you understand what you thought, what is really there? It’s a chance to look more deeply into yourself, and find the source of that thought – probably another thought that would be more useful.

For example, “That idiot cut me off” is a variation of “People shouldn’t cut me off.” With the questions, it becomes:
1. Yes, of course it’s true!
2. Well, I guess not. I mean he did cut me off, so obviously at some level he SHOULD have…
3. When I believe the thought, I get mad. That doesn’t feel good. I don’t drive as safely either.
4. Without that thought, I would be still relaxed, driving safely down the road.

Now the Turnaround
People do cut me off, so what should I do? Let them! Then there’s no anger or danger, and I don’t care any more, so no negativity. Just slow down, relax, and drive safely…

It really does work – now there’s a little less negativity in your life. Next, you can apply it to family, friends, money, work expectations, and so on. Really, you’re learning how to handle when your expectations and reality don’t meet. Read Loving What Is for a lot more ideas and examples. Buy the book, so you can refer back to it, and check out the website here.

Links of the Week

2009-01-09T05:25:00.000-08:00

Having lived overseas for years, where the local library's only English books were a small collection of Hemingway... I have been LOVING the local libraries again. No internet link, but a reminder of the real-world link that a library can be - free books, magazines, and newspapers, as well as literate people and a chance to meet some good people. I have the best random conversations in libraries!

If you need to buy a good book, Amazon can be cheaper than a used bookstore, and has fast delivery. I'll have a specific recommendation up tomorrow!

For a free book, from Get Rich Slowly, Suze Orman was just on Oprah, and her latest book is available for download until January 15th right here.

Working at your computer? Music always helps my productivity, and Pandora is an amazing music site. Just input a song or artist, and they'll put together a playlist based around their connections. Due to copyright, they won't work outside the US, and they don't have everything. But I've got stations based on Jason Nevins, Coming In From the Cold (Bob Marley), and Greg Brown - and most of the performers they play I've never heard of before. Just don't let it distract you too much at work!

And finally, a new project I'm starting: Online Money Journal. This will be a blog of my attempts to make money online. If you're thinking of doing the same, come share the journey with me. I'll be looking at blogging, affiliation, selling, eBay, and telecommuting through some very good online sites. Help me (help you?) create wealth online!

Living Well Rule #1: Know Yourself

2009-01-08T13:45:00.000-08:00

It was really interesting. I had just gotten back from a trip through Greece and Turkey, and was looking over my pictures. I had picture after picture of the Blue Mosque, the palace in Istanbul, Bosphorus Strait, and the Parthenon. And here was one picture of me on a beach in Mykonos, a Greek Isle in the Aegean Sea.

I wondered why I had so many pictures of building, ruins, and famous places – and yet only one of this gorgeous beach. Had I forgotten to take pictures here? Obviously I had. And yet why?

It came to me slowly, through several conversations with friends over the next week. The other places were beautiful, and everyone was taking pictures of them, so I went along with the crowd. Not overly interested, I walked, half-bored, taking pictures of buildings that drew so many people year after year.

But the beaches and natural beauty of the Aegean Sea was breathtaking. I’ve realized that I’m a lover of the natural, the eternal. Man-made objects, no matter how spectacular, historic, and famous, just don’t have the same pull. Give me white, sandy beaches with a few tropical trees and I’m in heaven. A sunset over the sea, SCUBA diving amongst coral beds, or hiking to a distant waterfall – these are the things I want to experience.

And this knowledge of myself has been very good for the pocketbook. I have little interest in big, expensive touristy areas. Disneyland, or the Great Wall, or any famous building - I don't need to spend my money there.

I live at the beach, in a small town - and have all the natural beauty and free vacations I can handle. When I'm stressed out, I just grab my camera and watch the sun set. I go for walks on the beach with my family, or sit next to a stream.

So take the time to get to know yourself, and save yourself time and money most people spend chasing things they don't really want.