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Why Crooks, Con Artists and Legitimate Businesspeople are Essentially the Same.

10/24/2013

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By: Stefan Aarnio
Freedomway.ca
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Get Stefan Aarnio's book "Money People Deal: The Fastest Way to Real Estate Wealth" at MoneyPeopleDeal.com!

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The great Zig Ziglar said it best “Money isn’t everything, but it ranks up there with oxygen.”

We live in a world that is ruled by money. Almost everything we do on a daily basis is tied to money in some way. We live in homes that are purchased with money, we drive cars purchased by money, we wear clothes purchased by money and we eat food that is purchased by money. More money can mean a better life, more money can mean fewer problems. Typically when we are asked how much money we want, the answer deep inside of ourselves is always “more”.

Many people struggle and work hard each day to earn more money. The sad thing is, many of these people do not understand what money is. How can you earn more of something that you do not understand? How can you master something if you don’t know what you are trying to master? Sun Tzu the great military strategist said:

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”

The translation of this famous quote from war to money would be: 1) If you know yourself, and understand money, you will never have to worry about money and will always have it. 2) If you know yourself, but do not understand money, you will suffer a loss for every gain you make with money. You will never get ahead. 3) If you do not know yourself and do not understand money, you will lose money whenever you encounter it and will be broke and constantly in debt.

Most people think that money is a from of exchange, or a currency, or a lubricant for life (why scrape through life when you can slide on by?) All of the above definitions are true, but the best definition for money that I have ever seen is:

“Money is an idea backed by confidence” -Ron Hubbard.

The man who works hard for money, works hard for another man’s idea that has become confidently supported by others. Companies become real when investors gain confidence and invest in them. The dreams of great visionaries like Apple by Steve Jobs or Disney by Walt Disney have become concrete once their visions and ideas gained the confidence of others.

Today, brands like apple and Disney have supreme confidence and are worth billions of dollars in stock and revenue. Apple has gained so much momentum it is now the most valuable company in history.

Money only has value, because enough people are confident in the idea of the money itself. In history, sea shells have been used as money, gold, silver, fur, salt, pepper, paper and digital numbers have all been money at one point in time. All of these systems are flawed and none of them have any real intrinsic value. The confidence that backs the ideas is much more important than the actual money itself.

Con men (short for confidence men), throughout history, have been successful at swindling fortunes by exploiting the human weaknesses of others through dishonesty, honesty, vanity, compassion, credulity, irresponsibility, naiveté or greed.

Con men present an idea, create confidence and once those two elements are in place, the victims fall prey to their weaknesses and will transfer their money to the con man who will promptly disappear with a fortune.

There is very little difference between an illegitimate Con Man and a real deal entrepreneur like Steve Jobs or Walt Disney in that they 1) create a clear idea and vision and 2) sell the idea with confidence.

The primary difference between a Con and a legitimate businessperson is that the Con has no real business, asset or investment, while the real businessperson has a tangible business asset or investment. Regardless of the validity of the scheme, the sales process for getting the money is the same.

But how does this affect you?

We all want more money, and since money is an idea backed by confidence, to create money, you must first create confidence. The amount of money you have will directly correlate to the amount of confidence you create.

Self confidence and trusting your decisions is the base of all wealth and is a pre-requisite for attracting money either through sales or through investor capital. Break a man’s confidence and you will also break his bank account. Raise his confidence and you can make him into a god.

Here are 12 Quick ways to raise your confidence:

1)   Get a makeover and create a professional appearance

2)   Keep a physically fit body

3)   Learn to speak well and have a wide vocabulary

4)   Keep well groomed

5)   Show up on time

6)   Have an assertive and firm hand shake

7)   Start small in your business and grow fast

8)   Take on projects that are easy to complete and slowly increase the complexity over time.

9)   Become the expert on your subject; know everything there is to know.

10) Get a coach or mentor to guide you through your studies

11) Share your successes with others, analyze and study your defeats

12) Teach others to sharpen your skills

Thanks for reading,

Stefan Aarnio


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The Formula for Wild Profits: Buy Intrinsic, Sell Irrational

12/17/2012

2 Comments

 
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By: Stefan Aarnio
Freedomway.ca
facebook.com/stefanaarnio
https://twitter.com/stefanaarnio
http://ca.linkedin.com/in/stefanaarnio

Remember: Please share this article if you found it enjoyable!

Beauty is in the eye of the beholder, and so is value.

Everyday, we, the human race, wakes up and chases value until we drop dead from exhaustion at night.

It doesn't matter if you are Donald Trump sitting on a multi billion dollar real estate portfolio or monk in a temple. We are all chasing value.

The real question is, what is value and what is valuable?

Of course, value is highly subjective and can be very hard to determine.

I always find it interesting to see how excited people are to buy new clothes. Shopping malls are filled with rabid people who are frantically purchasing new garments to wear and 6 months later the clothes that they purchased will be donated to charity or thrown away.

The value of the clothes goes from "I will sacrifice my financial health to wear this" to absolutely "I will never wear this piece of garbage again".

The same thing happens with electronics. The day that apple releases a new iPhone or iPod, people are camping out overnight to get their hands on the new gadget and will pay a mortgage payment to own it. 6 months later, the same people are giving the old iPhone to their dog or are using it as a coaster on a coffee table because the newer, thinner model came out.

But what about investments? Real estate? Houses?

What is the true intrinsic value of a house?

Most middle class people will say "our house is our biggest asset"!

Most middle class people will have nearly all of their net-worth tied up in their home.

But what is the house actually worth? What is any house actually worth?

The truth is, all real estate is actually worth $0. Land and buildings are completely worthless.

If you would like to see the true value of land and buildings, drive to Detroit where you can buy a city block for $1 and nobody wants to buy it. People who live in detroit would rather have a $1 Taco at Taco Bell than own the liability of a city block.

Land, real estate, houses, and buildings only get value when there is a USE for it and an END USER. The end user places his or her subjective value on the Real Estate and that is where values come from.

There are more people who want to live in Manhattan than Detroit. That's why Manhattan real estate is worth so much more than Detroit.

At the end of the day, Real Estate is only worth what the end user is willing to pay. However, one metric I have been using more and more of lately is dollars per square foot.

When comparing two similar properties, dollars per square foot is one of the best ways to measure the current and future value of the property.

For example, in Winnipeg right now, many houses trade in the $200-$250 per square foot range. If you can make a purchase at $100 per square foot in an area that is trading at $200-$250, you have an opportunity for profit.

Construction in Winnipeg for a new build is approximately $200 per square foot, so if you can purchase for less than $200, you are getting the house cheaper than it would be to build. Likewise, if you pay $270 per square foot, you are paying more than it costs to build.

When analyzing retail single family homes, dollars per square foot is an excellent metric for intrinsic value of the property.

BUY ON INTRINSIC VALUE, SELL ON EMOTIONAL VALUE

One of the easiest ways to profit in any market is to:
1) Buy on intrinsic value and
2) Sell on emotional value

There is always profit in markets that have irrational buyers. Irrational buyers means that irrational amounts of money are floating around looking for irrational products.

For example, the neighborhood River Heights in Winnipeg is a desirable neighborhood where people will pay irrational amounts of money to get their kids into the local schools. In River heights properties trade for $200-$250 per square foot, prices that are well above cost to build.

However, in up and coming parts of town, there are "rational" buyers who will only pay prices that less than construction prices. These areas will trade at $150-200 dollars per square foot.

The key for profit is to buy with on an intrinsic value, pump the value and sell to an emotional, irrational buyer. The irrational buyer is unconcerned with what they are actually paying. They WANT the product and perceive that they NEED it. If you have a business, you want irrational buyers. Irrational buyers are consumers who allow you to create massive spreads in your products and grow your business.

Do what you can to attract irrational buyers. When you capture these buyers, take great care of them, and they will take great care of you.

Thanks for reading,
By: Stefan Aarnio
Freedomway.ca
facebook.com/stefanaarnio
https://twitter.com/stefanaarnio
http://ca.linkedin.com/in/stefanaarnio

P.S: Please share this article if you found it enjoyable!





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    Stefan Aarnio

    Stefan Aarnio is a Real Estate Investor, entrepreneur and artist based out of Winnipeg, Manitoba.His real estate website is Freedom Way Joint Ventures  His art can be seen at http://stefanaarnioart.com

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