How to take advantage of the current economic conditions and set yourself up for life?

How to turn a negative into a positive? This is a very important question that if we can secure the answer will ensure happiness in the future.

We need to know that the world is going through some very tough times and with tough times there always comes opportunity. What can we do about our own situation, knowing what’s happening in the world?
Well there are a number of things we could be doing.

1. Get busy looking at opportunity – as Barron Rothschilds said ‘When there’s blood in the streets, there is money to be made’. With every downturn there is immense opportunity. You have to have your eyes open to see it, you have to want to see it, but it is always there for us if we choose to see it.
2. Get busy learning. Now is the time to watch the markets, watch for business opportunities, watch for sales that may not have been there earlier (i.e. mortgage stressed housing sales in real estate). Know these markets, know who to talk too, how to capitalise on this opportunity.
3. Get back to business basics – understand your business and where it is situated – I am constantly blown away by how many business people have no idea how their business is travelling.
4. Think like Buffett – Worry about the long term. Do not be too worried about the current value of your assets. If you buy good stocks, good property, good business on sound financial grounds with solid figures and demonstrating good value – trust that in the long term it will be a great investment(see below).
5. We can look to build on our foundations, but we need to make sure the foundations are strong. No bad debt. Good cash flow, strong financial position = ready to exploit opportunities
6. Look at job security as there will be fewer alternatives if you do lose your job or business gets tough in the short term.
7. Reduce any ‘bad’ debt such as credit cards, store cards, even personal loans.
8. If you were ever thinking about getting into other investments or your own business there may not be a better time then over the next few years. Houses will be cheaper, Stocks and property will sell on high yields, Business’ will sell cheap – good business’ that have just got themselves into financial trouble but fundamentals are good.

So I’m sure you and your family will be fine in this changing and unpredictable economic environment and if you constantly look to  ’turning adversity into advantage’ then this could be the few years that determine the success you will enjoy for the rest of your life in accordance with your dreams and your aspirations.

The global economic conditions are unlikely to change irrespective of the action you take, however by taking action and turning adversity into advantage the changes you may see in your own situation could be dramatic and fantastic.

Get excited, get enthusiastic, take action!

Here is a great example of turning adversity into advantage!
The 1973-74 bear market gave Warren Buffett the opportunity to purchase a stake in the Washington Post Company (NYSE:WPO) – an investment that has subsequently increased by more than 100-times the purchase price – that’s before dividends are included. At the time, Buffett said he was buying shares in the company at a deep discount, as evidenced by the fact that the company could have “… sold the (Post’s) assets to any one of 10 buyers for not less than $400 million, probably appreciably more.” Meanwhile, the Washington Post Company had only an $80 million market cap at the time.
Reference investopedia

 

Nick Cleary - Adrenaline Coach and Auctioneer