Those how have leverage in life get head faster. Whether it is mechanical leverage or leverage in negotiations. Think of it as just and extension to your current tools. Here of course we are talking about financial leverage.
A simple question to ask yourself where does money come from. Well the vast majority of it just get created from thin air1. It is hard from most people to understand that. It is particularly hard for those who were taught, believed and practiced the principle of “hard work”. The latter is just a lie those who get their money for free want others to believe so they can use them as wage slaves the rest of their lives.
The easiest and most logical way to make money is to do what those who make money do, make it. Banks make money by creating debt. Debt requires payment of principle and interest. And although the principle payment offset the bank’s loan, interest are forever. Think of it, the bank is pocketing an interest on a money sum they do not even have! Now, please make sure you go work hard 8-5 tomorrow so you can get ahead.
So, how to do this really. How do you act like the bank. Well short from having a bank, there is couple of ways. I will share them with you here.
Using stock options: Most guru come on TV or on line to tell you how to buy options. Reality is money is made in options when you sell the options. When you sell the option you put time on your side, the title of this post. It is true that you are now on the hook to meet the obligations of the option, but with a little bit of math, you can see that you are better off selling the options no buying them, as long as you can cover your obligations financially.
Real Estate Middle Man Banker: The bank makes money by putting digits in someone’s account so why do not you do the same. Buy a property, finance it from the bank with low rate, turn around and do a rent to own on it with large down payment and higher effective rate. Either you pocket the differential in interest, or you do that and you pocket the down payment and repossess the property if the buyer defaulted.
Refs:
(1) – How is Money Created? – Everything You Need to Know
(2) – It seems that anyone can make a “theory” today. All you have to be is some kind of celebrity and open your mouth. The Milkshake theory is just that. It just says the dollar is going to get stronger but no solid “prove” is offered by Brent Johnson, the owner of the theory.
(3) – The Cantillion is simply the principle that if you are closer to a source, you will get more emission. That works if the source is sun you you get more light or if the source is a rich uncle and you are getting a whole lot of pocket money to spend.
(4) – “As announced on March 15, 2020, the Board reduced reserve requirement ratios to zero percent effective March 26, 2020. This action eliminated reserve requirements for all depository institutions.”, Reserve Requirements