“The hardest thing in the world is for young people to save and old people to spend.”
— “The Maxims of Wall Street” (p. 21)
The first section of my book, “The Maxims of Wall Street,” focuses on the vital necessity of saving, investing and spending your money wisely.
I find that people have three main uses for their money. They are:
First, money to live on — earning enough money to pay for basic expenses such as housing, transportation, food and other essentials, including funds for emergencies.
Second, money to retire on — earning enough money to start a savings or investment program. So, when you retire, you can enjoy life and not run out of money.
Ultimate Financial Freedom
Third, money to burn (spend freely) — funds for travel, vacations, second homes, artwork, charities, conferences and other good causes.
Once you reach the third level, you have true financial freedom. It should be the goal of every investor: have money to burn!
Sadly, only a minority of investors reach this level. A recent study showed that only 24% of Americans have an emergency fund to live off of if they suddenly became unemployed or faced a serious medical illness. Plus, 57 million Americans have no emergency savings.
And 32% of Americans aged 53 to 62 have zero savings at all. Only the elderly really have built a solid saving and investment program. No wonder the average age of my subscribers is 55 years. Young people often have no money to invest!
Norway Shows the Way
Americans could learn a thing or two from Norwegians.
Earlier this week, I was in Oslo, Norway, on a Scandinavian cruise, and I had lunch with a highly successful Norwegian business leader, Lars Peder Nordbakken. Lars will host the next general meeting of the Mont Pelerin Society in Oslo in 2020.
Norway has the highest savings rate of any country in the world, except Chile and China — encompassing 17.7% of the nation’s gross domestic product (GDP). (The U.S. savings rate is 4.1%.) Because of its large oil & gas reserves, Norway has the world’s largest sovereign wealth fund, which is valued at more than $1 trillion.
I asked Lars Peder why Norway has such a successful sovereign wealth fund and Venezuela, which has the world’s biggest crude oil reserves, has virtually no sovereign wealth fund at all. His answer, “Norway has the rule of law and Venezuela is a mismanagement disaster.”
Henrik Ibsen on Money
After our luncheon, Lars and I went over to the National Theater and had our picture taken in front of a statue of the great Norwegian playwright Henrik Ibsen. (See the following photo.)
Lars Peder Nordbakken (left) and Mark Skousen (right) in front of the Henrik Ibsen statue in Oslo, Norway
In addition to writing some great plays, such as Peer Gynt, The Doll House and Enemy of the People, Ibsen also was a poet.
He wrote a memorable poem about the role of money that I quote to all my students at the end of each class in finance and economics at Chapman University. Here it is:
Money may be the husk of many things,
But not the kernel.
It gives you food, but not appetite.
Medicine, but not health.
Acquaintances, but not friends.
Servants, but not faithfulness.
Days of joy, but not peace or happiness.
How true! The Ibsen poem gives the true perspective on money.
The Ibsen quote is one of 800 poems, financial adages, ancient proverbs and other pieces of worldly wisdom found in my book, “The Maxims of Wall Street.” Now in its 6th edition, it has been endorsed by Warren Buffett, Jack Bogle, Alex Green and many other financial gurus.
Dennis Gartman said, “It is amazing the depth of wisdom one can find in just one or two lines from your book. I keep it on my desk and read it daily!”
To encourage you to read and distribute the book to friends, clients and brokers, I offer the first copy for only $20 and all additional copies only $10 each. If you buy a box of 32 copies, you pay only $300.
I autograph each copy and mail them to you at no extra charge. I’ve sold over 25,000 copies. To order, go to www.skousenbooks.com, or call Harold at Ensign Publishing, 1-866-254-2057. (For foreign orders, call Harold for additional mailing charges.)
Philadelphia MoneyShow, Sept. 26-28, Philadelphia 201 Hotel: I’ll be making a special appearance dressed as Ben Franklin! Other speakers include Ken Fisher, Dennis Gartman, Tom Sosnoff and John Buckingham. You can obtain free admission to the MoneyShow as my guest by calling 1-800-970-4355 and by mentioning pass code 048316.
Good investing, AEIOU,
You Blew It!
Doesn’t the Federal Government Have Something Better to Do Than Harass Hard-Working Mexicans?
By Mark Skousen
Editor, Forecasts & Strategies
It is a sad commentary in this country when hard-working Mexican immigrants are arrested and their families torn apart because they don’t have a work permit.
Worse, the businesses that hired their hard-working Mexican immigrants will be punished for tax and wage “fraud.” Meanwhile, millions of American citizens can sit on their duffs for years and get thousands of dollars in federal aid for doing nothing.
Last week, U.S. immigrant officials raided seven Mississippi chicken processing plants, arresting 680 mostly Latino workers. The ICE government agents surrounded the area to keep the workers from escaping.
President Trump said the ICE intervention was “very successful.”
When one immigration policeman was asked why he would act so callously toward immigrants who were struggling to survive financially, he said, “It’s my job.”
But as Paul Newman said to the prison guard in the film “Cool Hand Luke” when he was put in “the box” for a night after he was told his mother died, “Just because it’s your job doesn’t make it right.”