About 5 years ago a buddy and I decided to become "investors"just like what we read in the book Rich Dad, Poor Dad by Robert Kiyosaki...even though at the time we didn't realize what that word event meant lol. We just wanted to be rich like any other person.
The problem is we had no money of our own to start with. Luckily (or unfortunately for us) at the time, the economy was booming and any schmuck or 18 year old kid could access to large credit lines. Which was the case for my buddy and I. There was then...and still is, high speculation of silver being the next big boom. So we had this great idea, lets take out cash advances and buy silver stocks on margin! So we used not our own money to leverage a 2 to 1 trade for silver. I highly advise against ever doing this sort of trick with anything at all. But the idea that we had was if silver was going to be the next big boom, we would capitalize on the market and double the money we borrowed...and have a great way of making money out of thin air story.
The market was rising and we were riding high or about a month telling everyone that we were going to be rich in 5 months. The problem is that around that time there was a 1 day dip in the silver market that kicked out all the speculating investors (ie my buddy and I) and we lost a ton of money and had to pay it back.
This was my first experience with the power of leverage. It can make you or break you badly. Credit is a perfect form of leverage. Some people use it for good and expand their business, while others use it foolishly for consumer reasons and have it work against them.
The point of this blog for me is to document my journey of how I figured how to use credit as a powerful tool to build wealth and educate some people along the way. Since this first incident I've lost much more money, but also learned many lessons along the way. Hopefully whoever reads this learns some tricks to help them on their journey to wealth. Good luck guys, until next time!
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