Should I Invest In China? A Top Down And Bottoms Up Perspective

Chinese flag on a light poleThe Nikkei 225 (Japan’s major index) is up over 60% since the election of Prime Minister Shinzo Abe on September 26, 2012. Abe has vowed to re-inflate the lagging Japanese economy with a target inflation of 2% through aggressive quantitative easing, setting negative real interest rates, and aggressive fiscal stimulus. So far, investors are in full belief of “Abenomics.”

One of the key results of effective quantitative easing is a depreciation of the Yen. The Yen has depreciated by around 25% vs. the USD and other major currencies. A weaker Yen is exactly what Japanese ministers need to reinvigorate Japan’s enormous export economy.

It’s apparent at least here in the US that Japanese electronics have waned with the rise of South Korean products from Samsung, KIA, and Hyundai. You wouldn’t be caught dead in a Hyundai 15 years ago. Now everything seems alright. Heck, the most popular YouTube sensation is PSY, a Korean pop singer.

Japanese electronics have always been considered of superior quality with premium pricing to boot. Now the difference in quality seems negligible at best, so prices must come down to stay competitive. A depreciating Yen is doing exactly that, while allowing manufacturers to save face by not cutting prices.

But let’s forget about the South Koreans for a while since they aren’t the Asian superpower the United States are worried about. Let’s try and get into the minds of the Chinese.


Good Advice On How To Better Manage Your Own Money

Waialae Golf CourseFor two decades I’ve been managing my own money. It all started when I saved up $3,000 from random minimum wage jobs to open up an online trading account under my father’s guidance. This was in the early 90′s when Charles Schwab first came out. One time I bought a company which I thought sold software, but was actually a bank! Clearly, I had no idea what I was doing. Thankfully, when you start off with only $3,000, the most you can lose is $3,000.

When it takes you several summers at $4 an hour to squirrel away $3,000 only to see half of it vanish in a matter of months due to poor investment decisions, you kind of curse the world. But, you also learn from your mistakes so you can minimize the experience of feeling that dull knife slicing through your financial security. Losing money early on taught me the importance of managing money.

Although the financial crisis of 2008-2009 certainly gave my net worth a massive uppercut to the chin, I didn’t panic. I just started this site and have more than doubled my net worth since then as everything has more than recovered as well. I credit net worth diversification to surviving the crisis and not jumping off a bridge when the S&P 500 hit 666. I also credit my childhood stupidity.

In this article, I want to provide the best advice on how to manage your own money. We will talk about fundamental principles as well as mental states you should accept if you want to continue growing your wealth over the long term.


How To Stop Haters From Hating You

Lucky Penny by Untemplater.comThe Boston attacks are a stark reminder of how much hatred there still is for America. Sadness has turned to anger as the country pulls together to understand why and move forward. It’s been more than a decade since 9/11 and yet I still think about what happened all the time after being on the top floor of WTC 2 for a conference just months before.

There are an estimated 7 billion people on Earth today. If only 0.1% of the population hates us, that’s still 7 million people who might very well be ready for war. We are a rich country full of opportunity, yet not everybody can have our same opportunity. The more successful we become, the more risk we face. The more we act as the world police, the larger resentment grows.

Whenever I meet someone in person, I do my best to downplay anything I’ve done that might seem successful. It helps that I’ve removed myself from corporate America and no longer have the desire to compete for money or status. I’m acutely aware of the widening gap between the haves and the have nots thanks to an unlevel playing field. The undercurrent of anger flows strongly through society, ready to drown anybody who is perceived to have more. Hate is part of the reason why I recommend everyone align themselves with the middle class. Blend in so that nobody can target you.

When I believe in something strongly, I will tell you so. If you demonstrate kindness, I will try to show more kindness. If you attack my honor, I won’t hesitate to defend it by confronting you and kicking your ass. What’s the point of studying martial arts for so long anyway? I do enjoy the occasional conflict if there is an intellectual debate. It’s when things start getting personal where I draw the line.

When you have what someone wants but can’t have, you’ll undoubtedly encounter some sort of conflict. One quick check at the background of your haters will reveal they have the most insecurities about themselves. Maybe they are lonely or work a deadend job they can’t escape. Constantly comparing ourselves to others is a sure fire way to zap happiness from our souls.


How To Lower Your Property Taxes: An Inside Look At How Property Assessors Screw Homeowners

Spring Blooming Cherry BlossomsYour property assessors’ #1 goal is to collect as much property tax from you as possible. Your goal as a homeowner is to make your home look like the dumpiest of dumps to pay the least amount of property tax possible. An asteroid could wipe out your entire city, but if the assessors office survives, they will come for you to collect!

Ever since the downturn, I’ve religiously filed a property tax appeal to get my assessed value lowered. In the midst of the financial crisis I was shocked that the assessors office appraised my primary residence for $100,000 more. If they got away with it, I would have paid roughly $1,200 more in property taxes that year. I ultimately won my appeal three months later and kept my assessed value the same as before.

For the next three years I got more aggressive and managed to lower my assessed value $100,000 below my purchase price. When the world is falling apart, it’s an easy sell to say your property’s value is also going down the tubes. In fact, my goal is to get the city to assess my property as close to $0 as possible.

Now that real estate is roaring back, I’m having a much harder time convincing the city I live in a rundown shack. This post will highlight how I almost got screwed over by the San Francisco property assessor again, and how I fought back and came to a compromise. Just like how every homeowner should be taking action to refinance their mortgage, every homeowner should take action by filing property tax appeals!


Three Bad Jobs That Can Eventually Make You Rich And Happy

Fast Food JobIf I wasn’t whipped so hard during my first job out of college, I never would have saved over 50% of my after-tax income every year for 13 years in a row. I probably would’ve blown the majority of my income on fancy cars, late nights at the clubs with bottle service, and frequent weekend trips to Atlantic City or Vegas.

At age 22, I already had the penchant for the good life having finally landed a plum job in finance. Going from making hardly anything to making a tidy sum very quickly is a very dangerous situation (think lottery winners). When your peers are recklessly spending money every weekend, it’s very hard not to follow. But I didn’t follow because of the jobs I once had.

Getting in at 5:30am and often leaving after 8pm was NO FUN. I gained 15 pounds, was constantly sick, and became a stress case. I also worked most weekends for the first two years because I was a dumbass who needed to learn more about finance if I was to sound remotely intelligent with clients. Each minute I worked past the 12 hour mark was a reminder to keep on saving money. There was no way I could last for more than three years in this cutthroat business I remember telling myself.

Before the post college lashes, there were three other jobs that helped me prepare for the real world. I hope to never do any of these jobs again, but never say never when you’re unemployed. What I realize today is that adversity builds character. The following three jobs helped prepare me to navigate workplace politics, resolve conflicts with employees, endure marathon work hours, produce consistent work and appreciate the value of a hard earned dollar.


Should I Convert My 401(k) Into A Rollover IRA?

Samoyed doggie Rollover IRAThis past week I decided to convert my 401(k) into a rollover IRA and I’d like to share with you why. Given I no longer have earned income, I can no longer contribute to my 401(k). The market is fully valued in my opinion which means I see a greater risk of a pullback during the summer than continued gains. Even though my 401(k) has 40 or so mutual fund choices provided across various sectors, countries, and asset classes it isn’t enough for what I want to do.