The Facebook Crash Isn’t What It May Seem (as usually is the case with anything on Wall Street..)

I haven’t been very social lately. We’ve had the playoffs….the playoffs….ummmm…..the NBA Playoffs… Go CELTICS!!

Oh and we’ve been selling a TON of houses!!

Silver has been falling. “Sell in May, and go away.” So they say anyways, we’ll see. It’s an election year and we know that Central banks are trying to prop up the dollar as long as possible. We’ll see if we see QE3 after the election and a skyrocket in silver pricing tho.. The USD (US Dollar) is higher than it has been in over a year at over 82.

Facebook has gone public!

Many people think that when there is a stock IPO(Initial Public Offering) that it’s the first time people can buy stock. That’s not actually quite accurate.

It IS the first time the general public can buy the stock. But before the general public can invest, accredited investors get their shot first, and at a much lower price! To be an accredit investor, you have to meet certain criteria that the SEC sets out. Basically this means that the wealthy get an advantage with investing..No surprise!

Facebook stock opened up near $40, and it is now below $30.

Facebook shares dropped 10% today at a drop of over $3.

Many people are saying the IPO for Facebook was overvalued. Those who claim this might talk about how Google has 10x the cash flow of Facebook and 10x the strength on their balance sheet. What Facebook has now over Google is social usage. Google is working on that, but they got in late.

But here’s the thing:¬†When a stock goes public, it is meant to benefit the company!! They make money by selling shares.

Facebook is smart and finds a way to do smart things. Zuckerberg is simply not your average CEO. There is something different to Facebook. It has swag. Facebook continues to adapt and integrate with other platforms. This is why I was wrong 2 years ago when I said Facebook was on the verge of falling to other platforms like wordpress and blogger.(right before my parents got on Facebook!) hah!

Will I invest in Facebook? I dunno…

With real estate, I can control my investment.

If Facebook keeps dropping, I can come up with a lot of fundamental analysis to support getting in. But I just don’t know…

What I can tell you I definately will buy more of if it keeps falling, is silver. I promise you I’ll pick up on that. I forecast QE3 after an election and more devestation to the European Union shooting the price of silver up.

If you want to follow Facebook as a company daily, and you commit yourself to a solid education in stocks, you can make money in Facebook. This way, you can make money whether Facebook stock goes up, goes down, or goes sideways.

But whether it’s Facebook stocks or any other investment, do your homework and don’t trust the BROKErs.

 

Print Your Own Money

By: Joshua Gamen

Knowledge is the new coin. Since 1971, the dollar is debt. This happened when President Nixon took the US Dollar off of the gold standard(without the persmission of Congress). See, money as we know it today is not constant, but rather it is a derivative of the faith in that which is perceived as the money. Let me explain…

The Dollar is not real money. What gives value to the dollar is not that it is backed by the full faith of the US government, it is that people have faith that it is backed by the full faith of the US Government. The problem with this is, as many of us already know, the government is broke. The United States government literally runs like a household who has maxed all of its credit cards and refinanced their house to a mortgage greater than it’s value. The difference between the US government and a household who might do that, is that if a household did that, they would lose their house and no longer be able to borrow money to live. The US government, however, has the Federal Reserve, who depends on the government to stay afloat, so that they can continue to indebt the people of the United States and world, which count on the government.

There are too few people who realize the true root of our economic problem. The problem is our money. The thing that we work so hard for and try so hard to hang on to, is actually our biggest problem! The ultra rich who control the money supply want us to need more and more of their toxic money, as that is the only thing that gives it value! The more of the money we need, the more they print. The more money we need, the weaker we become, and the more we are headed towards socialism, where we fully depend on our government to provide everything for us.

The Federal Reserve does not provide anything of tangible value, they simply create money out of thin air which they then lend to the government and other banks, who in turn lend the money to people, in exchange for a debt in which they will never in their lifetime be able to pay off. Hence the name of the game, DEBT. The Federal Reserve has no reserves because they don’t have any real money. Why would they need to store money when the rules of the board game Monopoly apply to them in real life?(The bank never goes broke. Which is a real rule btw..)

“The Federal Reserve Bank is not a bank. That idea is as illusionary as our money.” -Robert Kiyosaki(Author of Rich Dad Poor Dad)

My point on this topic tonight, however, is not that the Federal Reserve is a hoax(Although it is), but that money in our modern day is based off of ideas. If you have something that others will believe in, you have created value.

For example, Mark Zuckerberg has no idea what he was creating when he started Facebook. As pointed out in the movie “The Social Network,” Mark’s goal was not to make money by selling ad space online, it was to create something in which EVERYONE would think was cool. Facebook was born. Now there are millions of Facebook users across the globe, and Mark Zuckerberg is the youngest BILLIONAIRE in the world. Mark printed his own money, billions and billions of dollars of it, by taking an idea and creating something others wanted.

The good news is, you can financially educate yourself, and use your own ideas and/or debt to legally print your own money. Let me give you a real life example. Since I have not asked the parties for their permission to publish their names on the internet, I will use simple made-up names..

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Jonny finds a 3 bedroom house for sale at $60,000 in Phoenix, Arizona. He gets a mortgage(debt) for $55,000 to purchase the property, and promises the private lender he will give them a down payment of $5,000 within 90 days. Jonny puts up the house for sale and markets it by saying, “Buy with no bank!”

Jonny then finds Bobby and Sue, who make good income but have damaged credit due to the recent foreclosure on their credit report(They simply could not make the payment anymore on their old house after their neighbors were paying 1/3 of the monthly bill to rent the house next door). Bobby and Sue need a house, because they have 3 large dogs and cannot stand the thought of keeping them in an apartment. So they give Jonny the $10,000 they had saved up while not paying their mortgage for 6 months, and receive the option to purchase the house at any time they want over the next 5 years for $70,000. Their monthly rent is $900, which is half the price they were paying in the house they got foreclosed on.

Bobby and Sue are very happy. They now have a house again in which they can call their home, and put their creativity and personality into it while keeping the equity for themselves. For them, all of the money and work that they put into the house increases their standard of living, but not at the expense of throwing the equity away, as was the case if they did anything more than sweep the floor at their old house.

But Jonny is the one who really makes out on this deal. Jonny did not save his paychecks to get the $60,000 to buy the house, he simply took out a private loan himself, requiring a down payment of only $5,000, which he had 90 days to come up with. His monthly payment on the private mortgage was only $600, even at 12% interest.

Jonny got $10,000 in his pocket before he ever paid out $5,000. So not only did he have someone else pay for his down payment, but he is also putting an instant $5,000 in his pocket on top of it, and another $300 into his pocket each month that he has the property. If Bobby and Sue buy the property, Jonny simply pays off his $55,000 loan and realizes another quick $5,000.(He owes $55,000, but Bobby and Sue owe him another $60,000 to buy off the house legally, in addition to the $10,000 they already gave him). If Bobby and Sue decide to move, Jonny can put the house right back on the market and do the same deal again for someone else. The down payment he received from Bobby and Sue will more than cover any short term vacancy.

Jonny has legally printed his own money, and will continue to print his own money every month that he has someone pay rent to him to live there. He has made money from nothing. He took on new debt, and created an idea in which was worth a greater debt to someone else. Rather than use that debt to weigh him down, he uses that debt to work for him. Some day the house will be paid off. This is really an infinite return.

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There are many more examples that could be given, but the point is that money is an idea. Knowledge is the new money.

It doesn’t matter if the economy sees inflation(cost of goods and services going up) or deflation(costs of goods and services going down), the name of the game is debt. Debt is what the ultra-rich are after.

If you want to have more money, your knowledge of money needs to include learning to use debt to create cash flow, then manage that cash flow. Whether you do that with real estate, businesses, the stock market, the internet, or whatever your idea may be.