Investing

What is investment? How do one invest? What do one invest?

There are many people and books about this topic. It has never been a tied subject.

The real principle of investing is very simple:

1) Understand the monetary policy and its influences

2) Understand how each sector behaves under monetary policy

3) Understand that basic investment human behavior

4) Understand business cycles

5) Understand nothing will go up forever, aka, business cycle

With those understandings, patience, and time, one can be successful in the investments.

Of course, geopolitics and history really influences investing environment, which requires a lot of readings to help one make decision.

I read Henry CK Liu's articles about China, Monetary policy history and gold's role in the last century. It is very enlightening.

One thing struck me is his mention of the diminish role of British empires. He said that after WWI, British's interest payment on government budget was 40%. Which prompted British gets into the WWII to suppress the German influence, hardly any conspiracy theory, but a natural reaction on the desperation of debts weight.

We in the US are facing the similar thing today, our interest payments on government budget:

(3 billion /day * 365) / (3 trillions) =  36%

Now, are we heading to a war again? It is possible but it only cause the demise of an empire. It happened to the Britain, US will face the same fate if that is what is going to happen.

Again, hardly a conspiracy theory like some dumb people in WXC boasted. It is a natural behavior of an incompetent government leadership.

I sincerely hope this won't happen in the US, but I am pessimistic about it.