A few weeks back I spoke with a friend, a mutual funds analyst who was trying to sell me her company's products. She mentioned that this is the shopping season for such kinds of investments. And for the first time, I agreed with someone who was selling me something. “Yes, definitely,” I told her.
I understand why the wealthy would panic after what happened to Lehman Brothers and Merrill Lynch. These are institutions where other institutions put their money. It would have a domino effect when one tile collapses, and the effect would be faster if the financial turbulence is stronger.
International and local stock markets are doing very badly, they say. We all see that. However, what we fail to see is the investment opportunity this opens up for us. I, for example, would risk a part of my savings to buy stocks and other forms of investments while the world is being battered by the economic crisis. The market is holding spending, and this is causing stock prices to drop. While the action I am planning to take seems to be irrational, no one can really tell what is going to happen next. I am risking the money that I have for additional earnings. If I lose, I lose. It is a gamble: gain some, learn some.
This time is also a good time to start a new business. If I were richer, I would put up a pawnshop. It is one of the few businesses that flourish when everyone becomes poorer every day. When people cannot afford to buy something, they will pawn whatever they have: jewelry, bicycles, laptops and even their mobile phones.
The money we have today will change its value tomorrow. Its value will either increase or decrease, but most probably it will be the latter. Although I see banks as a safe place to keep one's money, I am not recommending that you place your money in a savings account if you can afford to buy treasury bills and bonds. These are higher-yielding investments compared to a savings account where you would not even notice any increase in your deposit after a year. The good thing about these securities is that they are always prioritized and you always get paid first.
Simple daydreaming may provide me with the bounty I wish for myself. I try to think of unusual ideas that might hit the market big-time. I can register these ideas so that my intellectual property rights are protected. In fact, I have a small notebook beside my bed where I write my “winning ideas.” Who knows, one of these ideas may yet make me a millionaire.
They say art is also a good form of investment. Since I am still on my way to earning my first million, I try to make my own art out of paper clips. I form different figures when I am nervous. I tell my sister that if I keep them in a box, a hundred years from now, my grandchildren will be able to sell them as works of art. But if you are richer than I am and you can afford the more expensive forms of art, invest in them. The older they get, the higher their value rises.
I cannot recall now what the best answer was, but I apply my answer whenever the situation calls for it. Buy and sell—that is what I do. Sometimes, it is receive and sell.
This Christmas Season will probably be a receive-and-sell time for me. Not all the gifts I will receive will end up in my room; some will be listed on auction sites. What may be useless for me might be of great worth to another person.
So let us not blame other institutions for our own poverty and lack of cash. That is passé. It has been tried and tested that institutions can only do so much. If we cannot rely on our basic salary or allowance, we have to make good use of what we have.
I say that we should learn to take risks, because it is only when we take risks that we learn the tricks. We are forced to learn because we are afraid of losing all the money we have invested and letting all our efforts go to waste. We learn because sometimes things fail and we do not want that to happen again. Remember the first rule of investment or even gambling: the higher the risks the higher the returns.
From the simplest to the most complicated, there are numerous ways to add to our savings. We should be enterprising and creative during these times and try to see the potential of everything. Let us not spend the whole day sulking and thinking about the crisis that is happening around us.
Geralyn L. Cruz, 23, works for a petroleum company in Ortigas Center.
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