- WEALTHY: Don’t leave piles of yet-to-be-made money on the table (Andrew Gordon)
- HEALTHY: New evidence of a threat to virility (Dr. Al Sears)
- WISE: Ben Franklin on patience
ALSO IN THIS ISSUE:
- 176 newspapers can’t be wrong … can they? (Michael Masterson)
- The main purpose of a self-promotional website (Bob Bly)
- Add "gallimaufry" to your vocabulary
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"He that can have patience can have what he will."
Benjamin Franklin
Kicking Off the New Year With ETR: The Number One Rule of Investing
By Andrew M. Gordon
Want an investing rule that will help you make more on your investments in 2007? How about a rule that can make you a better investor for decades? Well, I have one for you – one I learned the hard way.
Oddly enough, I learned what I call the "number one rule of investing" as a businessman. It wasn’t until after I’d used it to earn a small fortune in business that I applied it to investing … where it also generated amazing gains.
Let me tell you how I came across this key to investment success …
When I first started to negotiate deals, I thought all I had to do was make the numbers add up and show the people sitting across the table from me that they could make a handsome profit by investing their money in my company’s development projects. So when the three businessmen from Hong Kong came knocking on my door, I greeted them with visions of a big commission check landing in my bank account within days.
I sat them down in the conference room, and went over the basics of the projects we were offering to them. I concluded the meeting by inviting them to dinner. I took them to the best steakhouse in Baltimore … with an unsigned contract tucked into my breast pocket. I was sure that, at this point, signing it was just going to be a formality.
The dinner went exactly as planned. They were having a great time. Toward the end, I asked them if they’d had a chance to further consider our offer. They replied that it was very interesting.
"Great," I said. "I just happen to have the contract with me. Would you like to sign it?"
They smiled and said that it was a splendid idea – that they were very glad I made this suggestion. Then the hemming and hawing began …
"I forgot my reading glasses."
"I’m not sure my English is good enough to fully understand the contract language."
"We do not want to spill anything on this very important document."
And on the apologies went.
I shrugged. I was a little surprised, but felt nothing approaching panic. We finished the meal and made plans to meet the next day.
Our next meeting was a rerun of the previous evening. The excuses were trivial, but accompanied by the sincerest of apologies.
I still wasn’t panicking, but I was nonplussed. "Fine, we’ll stay in touch," I said.
And we did. Over the next few months, I sent them charts, PowerPoint presentations, explanations of explanations, etc. Nearly six months later, I got one of the politest letters you’ll ever see. It talked about the wonderful time they had in Baltimore. How nicely they were treated. What a great company we had. What a pleasure it was to discuss business with us. But … they were no longer interested in pursuing our investment opportunity.
I didn’t understand what drove their decision. Why were they leaving so much money on the table?
The following year, I met with three more businessmen in Kuala Lumpur and then Jakarta, where our discussions turned serious. This time, I was less confident that the numbers could speak for themselves. I explained our projects more carefully, and encouraged our prospective partners to ask questions. They did, which I saw as a positive sign that we were making progress.
But I didn’t try to "close" the deal. I merely suggested that we should reassess it when we all got back home.
Back in the states, I sent e-mails to the three men, restating the numbers and profit projections and including timelines based on various start-up dates. Still, their interest in the proposed projects began to wane … slowly at first, and then faster.
I tried desperately to rekindle interest. I suggested various financing alternatives. I made bigger promises. I urged them to act sooner rather than later.
Ultimately, I threw up my hands in frustration and called it quits.
And it was just by chance that I ran into an old friend of mine at about this time. The son of a missionary, he grew up in one of the least-developed regions of China – Anhui Province.
I told him my story. How my company had developed a way to use proven technology that would pay back an original investment in a year. Anything after that would be pure profit. But the companies I’d met with seemed to shy away from making a deal … and I couldn’t figure out why.
My friend said he was pretty sure they loved the idea of investing in our projects … at first. But the more I pushed to close the deal, the more suspicious they became. Until, through my insistent badgering, I convinced them that the deal was bogus.
He said, "You bargained like a street vendor who’s afraid that once the tourists walk away, they’ll never come back to buy your cheap imitation watches.
"You need to let the deal advance on its own. When it’s ready to move an inch forward, it’ll move an inch forward. When it’s ready to leap forward, it’ll make the leap. When it’s ready to make you money, it’ll make you money. If your business is the real deal, it’ll blossom on its own. All you have to do is wait."
This was contrary to everything I had learned about doing business. But it was coming from a person who had an unerring sense for how things to get done in that part of the world, so I took his words to heart.
On my next trip to Asia, I took the long view in my business discussions. And it was amazing how things began to fall into place.
I took my time with the people I met with. I asked them a lot of questions (rather than encouraging them to ask me questions). I dropped any mention of a timeline. I stayed longer in the places I visited. I had more meetings, but I let them bring up business matters. Sometimes they didn’t, and we talked about our families, politics, sports.
In other words, we got to know each other.
I gave them full freedom in dictating the pace of our negotiations. And if it seemed that the pace had stagnated, I let it alone.
As my friend told me, "You need to let the deal advance on its own."
I got my first deal with these people 11 months after that trip. I got my second deal two months later. A third came soon after. Not all my discussions turned into done deals … but enough did to get our company firmly established in the Asian market.
When I segued into investing, this lesson became my number one rule: Be patient.
And that’s not the only lesson I learned in business that can be applied to investing. The principles are basically the same … and I can sum them up in these three rules.
- Don’t fall for a good story and lay down your money there and then. None of my prospective business partners did, and neither should you. Every good street vendor has a good story to draw you in – but that doesn’t mean his watches are any good.
- Take your time in getting to know a company. You can read and evaluate the essentials on a company in a matter of hours. But you need more than a day or a week to really understand its ins and outs – so don’t expect to invest in that timeframe. Make sure the company you’re investing in is the real deal. Make the passage of time your friend, not your enemy.
- Check out the numbers but don’t fall in love with them. My long-ago held belief that numbers reveal the worth of a business deal – or investment – was only partially true. The numbers are important, but you should also consider the management team, the market the company’s in, the money they’re spending, the competition they’re facing, and so on.
But while these three rules have given me a valuable leg up on the market, combining them with my number one rule has made me – and my subscribers – by far the most money. I can’t count the number of times a company went nowhere after I’d researched it and put my trust in it … only to blossom much later. Here are some recent examples:
- A small Texas real estate company I recommended to my subscribers in May 2005. In June of the following year, it still hadn’t made a cent. Then it began climbing. It’s now up 25 percent.
- A mining company I recommended last November. Other analysts thought it was going to spike. Four months later, it was up only 15 percent. That’s fine … but it’s no spike. It’s since surged to over an 80 percent gain.
- A shipping company I recommended last December. Over the following six months, it went nowhere. Then, in June, it finally began to climb. It’s now up 25 percent.
- An airline company that went nowhere from February to September of last year. Now, it’s up almost 20 percent.
If I were impatient, I could have easily encouraged my subscribers to sell these companies at a loss or, at best, small gains. But I’ve been there before. I know a good investment when I see one (just as I knew a good business deal when I saw one). And I’ve learned that nothing good comes from trying to force the pace.
Of course, not all investments (or business deals) work out. And when they don’t, you have to be ready to cut your losses and move on. But if you do your homework, you should find that plenty of your investments will meet – if not exceed – your expectations … when given enough time.
And all you have to do is remember my number one rule of investing: Be patient. A stock will make you money when it’s ready (if it’s the real deal).
Now, how hard is that?
[Ed. Note: Andrew Gordon, ETR's financial expert, is the editor of our new investment service, INCOME. Each month, he uncovers specific stocks that promise safety (first and foremost), along with much higher-than-average profit potential.]
Start Making Money Today
Interested in getting a nice little side-business going on the Internet? Or maybe even from your living-room table?
But you don’t have too much money, you don’t have too much time, and you’re not exactly Bill Gates when it comes to technology. Sound familiar?
A lot of people are in the same boat. The good news is that ETR has heard you. And now we’ve done something about it…
We’ve asked our colleague Marc Charles to be on the lookout for profit opportunities that can be run from a kitchen table, your desktop or out on the road.
Criteria? They’ve got to be inexpensive, easy to start, and still have great income potential, but without a lot of red tape.
They say when you’re first getting your feet wet with a side-business, the most important dollar to make is the first one. Well, Marc is an expert at taking beginning entrepreneurs and showing you how to make that first buck. He knows, because he’s done it dozens of times for himself, his family and his friends.
If you’ve been dreaming about starting your own business … now you can get started for about the price of 2 lattes.
And get this – you could be making money literally just hours from now. Imagine the feeling of finally getting a side business launched -TODAY!
- Patrick Coffey
Notes From Michael Masterson’s Blog: The Eyeballs vs. Dollars Question
A consortium of seven newspaper chains representing 176 daily papers has made a deal with Yahoo to share content, advertising, and technology, The New York Times reported. This is "another sign that the wary newspaper business is increasingly willing to shake hands with the technology companies they once saw as a threat."
I applaud newspapers for understanding that they need to get with the Internet, but I wonder if this is the right way for them to go.
[Ed. Note: Read the rest of this article on Michael Masterson's blog.]
- Michael Masterson
The Connection Between Cellphones and Sperm Count
By Al Sears, MD
New research shows an alarming connection between low sperm counts and the number of hours men use their cellphones.
In a study of 360 men, the researchers found dramatic differences between the men who used their phones for more than four hours a day and those who used them for less than an hour. In fact, men with the highest cellphone usage had a 25 percent lower sperm count than men who’d never used a cellphone – and only one-fifth of their sperm looked normal under a microscope.
One theory to explain this comes from Ashok Agarwal, Ph.D., of the Cleveland Clinic’s Reproductive Research Center: "Somehow electromagnetic waves may be causing direct damage to these cells and that perhaps causes a decrease in sperm production."
While research continues, limiting the amount of time you spend on your cellphone would be wise.
[Ed. Note: For more winning strategies from Dr. Sears to reclaim your energy, power, and drive, check out 12 Secrets to Virility .]
Quick Internet Marketing Tip: How to Attract More Clients, Part 1
By Bob Bly
It may sound like common sense, but many freelancers don’t realize just how powerful a website can be for attracting clients. Your website can:
- offer potential clients a chance to get to know you
- show them samples of your work
- give them an easy way to contact you
But your website’s most crucial function is to give you credibility.
By not having a website, you could actually be losing jobs.
Let’s say you contact a potential client about a job. One of the first things they’ll do is look at your website. No website … and their first inclination is to go elsewhere.
Your website doesn’t need to be high-tech. A simple site that includes samples of your work, contact information, and a few testimonials from satisfied customers should do the trick.
[Ed. Note: Bob Bly is the editor of ETR's Direct Marketing Masters Edition, a program to help you start your own successful direct-mail business.
Whether you're using your website to promote your services or sell your products, we'll be giving you lots of ideas in ETR to help you make it work better for you ... starting with Saturday's upcoming article by David Cross. Watch for it.]
3 Dividend-Paying Stocks You Should Buy in the Next 5 Days!
I’m urging everyone I know to buy three stocks in particular—three income-generators that offer you steady sources of income that could begin in the next 90 days.
Click here to get the actual names of 3 income-producing stocks – their names, histories, stocks symbols, everything – you should rush and BUY in the next 5 days before they shoot higher.
Word to the Wise: Gallimaufry
A "gallimaufry" (gal-uh-MAW-free) – from the French for a kind of stew – is a hodgepodge; a motley assortment.
Example (as used by Ezra Bowen in Time magazine): "Today bilingual programs are conducted in a gallimaufry of around 80 tongues, ranging from Spanish to Lithuanian to Micronesian Yapese."
Michael Masterson
Copyright ETR, LLC, 2007
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