As 2008 comes to a close we are seeing an ever worsening economic picture. Unemployment is climbing higher than it has been in a number of years. Bank and major corporate failures are alarming everyone and are likely to continue for some time. For the first time in decades we are entering a period of prolonged deflation. As bad as inflation is, prolonged deflation is worse. The last period of prolonged deflation was the great depression of 1929-1943.
It is not possible to predict with certainty now bad this downturn will be or how long it will last. There are alarmists running amok claiming that the world is ending and there is no more reason to believe them now than at any other time. On the other hand some very reliable names, like investment advisor Harry S. Dent, are warning us in very sober terms that the 2009-2015 period will be a very difficult one for our economy. While there will be some ups and downs during that time, over all it appears the downs will be predominant.
This is no time to panic. It is true that in down times things can become very difficult. People may have to postpone some plans and reduce some expectations. This can also be a time of great opportunity. Low markets can be a great time to invest in real estate and other sectors as long as it is done wisely.
If you want to build wealth during this time (or any time for that matter) you must follow the five primary rules of building economic wealth:
Continually educate yourself about your options and proven methods of creating wealth and reducing risk.
Save: pay yourself first making your savings plan just as important as paying the rent.
Make it automatic: make your savings and investment automatic through systematic direct deposits and other mechanisms so that you do not have to exercise self discipline each month.
Become a wise and informed investor.
Become a business owner.
I will explore these themes with you in coming blog entries and in a special series of reports in the Creating True Wealth ezine which comes to you twice per month free of charge. (You can sign up by going to http://www.books2wealth.com/ )
This is not a time to panic or to be driven by fear. It is a time to educate yourself about the options, about what the smart people are reading, thinking about and planning to do in the new economy we have entered. It is time to learn more about how you can and should build wealth. How you can be a business owner and an informed investor and how you can build wealth in the future in ways that will relieve you from depending on a single source for financial security, whether it be a single job, career or investment.
Difficult times are also times of opportunity. Let’s learn to exploit the opportunities and create wealth!
Daniel R. Murphy
Daniel R. Murphy
Educating people for building wealth, adapting to a changing future and personal development.