The BIGG Successs Show
Smart Investors, Tough Times
How two billionaires profited during financial panic. Find a written summary along with the links we refer to at BIGGSUCCESS.COM.
If you would like to get the newsletter we’ve referred to here, just e-mail us: bigginfo@biggsuccess.com, with “Profiting from Panic” in the subject line. We’ll send it to you and sign you up for The Bigg Success Weekly!
Welcome to the Big Success Show. Today, we'll talk about smart investors and tough times. The Big Success Show with George and Mary Lynn. For anyone, Mary Lynn, who likes bad news, they've had a lot to like lately. Try to avoid the news. Don't read the newspaper. Don't turn on the TV. No good news. Is good good news? Is that the old story? Yes. And, of course, obviously, we're talking about Wall Street in Washington. And we don't usually do this, but, well, in fact, we've never done this in 230 shows, but this subject- But we have to make an exception. Yes, because this subject is so important and timely that we wanted to share some valuable information that our newsletter subscribers to our Big Success Weekly got last Friday. Yeah, and the newsletter was titled "Proffiting from Panic," and, you know, it's all about really just creating the right mindset for yourself so that you can make the right financial decisions in a market like this one. And we started off just talking about the safety net that exists for all of us as depositors, as investors, and as insurers. Of course, the banks are insured by the Federal Deposit Insurance Corporation, the FDIC. And we've got some links on our site today that talk about what's insured by the FDIC, what's not insured, what would happen if your bank failed, what would be the process to notify you, what if your bank's already failed, we take you to specific pages on the FDIC site that you can get the information you need really quickly. Now, normally, only our Big Success subscribers would get this, but like we said earlier, we're making an exception because this is so important. And of course, brokers are insured by the Securities Investors Protection Corporation, the SIPC. And the coverage there isn't as extensive as the FDIC, but as an investor, you still have some rights, you still have some possible remedy, should things go sour with your broker. And we have a link to that on our site today as well. Now, for the insurers, there is no federal governing body per se, but each state does offer some remedies. Each state has its own association for the companies themselves. And on our site, you'll find a link to the national organization that's the trade group for all of those associations, as well as a link to every state department of insurance. So that's the safety net that exists. So we told you this just because it is important to realize you don't have to panic. There are some safeguards, but you should also understand that you can profit from this panic. Coming up to billionaire investors and how they've profited from situations just like this. Today, we're talking about the ups and downs of the financial market and the government bailout, I guess. Well, we're really not talking about the bailout. We're talking about our mindset and how we should behave and think in a market like this. And we've got two people who I can't think of anybody better to listen to than these two people. What the first ones say, Mary Lynn? Well, the first one, Warren Buffett, who is the richest man in the world. I pay attention when he talks. I don't blame you. And he recently invested $5 billion in Goldman Sachs in the midst of all this turmoil. And that's pretty typical of how he's made his fortune. He says he's fearful when others are greedy and greedy when others are fearful. Of course, we talked about that not long ago, actually. And here's another Warren Buffett quote that I think really sets the stage for how he thinks in an environment like this when he says, "We want to do business in a pessimistic environment, not because we like pessimism, but because we like the prices it produces." And Warren Buffett is not alone. J. Paul Getty, one of the first billionaires. And at one time, the richest man, according to the Guinness Book of World Records, he says, "I began buying stocks at the depths of the Great Depression. Prices were at their lowest and there weren't many stock buyers around. Most people with money to invest were unable to see the forest of potential profit for the multitudinous trees of their largely baseless fears." Now, that's a different force and a different set of trees, Marylin. But you know, he says that he went on to earn 100 times his investment on many of the stocks he purchased. Now, from doing my math, right, that's a 9900% return, not bad, huh? Not bad at all. Now, so I guess what we're trying to say here is don't panic, even though all the newscasters will tell you to panic, right? We're not telling you to run out and buy. I mean, I know I'm not a billionaire. I can't just go out and do that. We're also telling you not to rush out and sell. But these two billionaires made their fortune by going against the grain. And so it's important that we keep the right mindset during these times. Keep making those contributions to your 401k because the nice thing is you can invest like these billionaires. Your dollar cost averaging right now when stocks are down, you're going to get more shares by contributing to your 401k than you would when it goes up and then diversify, diversify, diversify. And speaking of diversify, subscribers to our big success weekly newsletter got an article with four key investment principles. And then we talked about how to put them into practice and why it's important to see yourself as the chief investment officer for you and your family. Nobody will look out for your money like you do, especially not the politicians in Washington or the brokers on Wall Street. And if you'd like to get that article along with the rest of the articles from our big success weekly newsletter, email us at biginfo@bigsuccess.com and put profiting from panic in the subject line. We'll sign you up for the big success weekly and make sure you get that issue. You can also find a written summary of today's show along with the links that we have provided today on our site at big success. That's big with 2G success.com. Next time we'll talk about why it's important to move beyond personal productivity. Until then, here's to your big success. [Music]