Things the Rich Know About Money That Everyday People Just Don’t Get

Watch the middle-income earners

Money is a sensitive subject. It is a trigger for a lot of people, especially those who don’t have much of it. And there are millions of people in the world today who believe they are being marginalized or cheated by big corporations or the government. And that is not true.

Not that the big corporations and governments are playing fair. Oh, they are NOT playing fair. But people keep expecting them to play fair after generations of playing unfairly. If that is not insanity, I don’t know what is.

Don’t blame the system — play different

You can create money. And I don’t mean making counterfeit currency in your house. I mean that you can create that which has monetary value. Let me explain.

Life is a Game

I know you are tired of gurus trying to sell you something with the promise of becoming rich. But the reason new people keep coming up with those tactics (and it keeps working) is the depravity of most people.

It is easier to tell people that they are where they are in life (financially) because of what they lack. And that is not true. You are where you are in life because of what you used. If you want to go somewhere different, change your tools. Use something else you have.

If you look at a poor man and tell him that he is actually rich, he would not believe it. But if you tell a poor man that he is poor, he will believe. And that has nothing to do with his finances. Many of the people considered rich today are billions of dollars in debt.

Take it one step further and tell the poor man that he is poor because his rich neighbor is greedy. He would be animated. He would be angry. He would believe it so much that tearing apart his rich neighbor’s business will make him flourish.

And eventually, the poor succeeds in tearing the rich apart only to realize that the rich man plays an important role in his livelihood. Now he is poorer than ever before, looking for somewhere else to attach the blame.

Life is a game. And what bugs me the most is the way regular people get played. Very few people really think. Most people just do things. They have no idea why they do what they do.

Yes, everybody was dealt different cards in life. It doesn’t do you any good to wish for the cards another person got. What you think is an advantage is also a liability.

I have discovered that people play the game of life wrong by chasing what other people are chasing. Or chasing what other people have and call success.

I saw a quote recently from Maya Angelou:

“Success is liking yourself, liking what you do, and liking how you do it.”

That is pretty precise. But can easily be misunderstood. So, I will make my own quote:

Success is understanding where you are, the advantages (and limitations) there, the problems that are yours to solve, the problems that are none of your business, and navigating to the best possible outcome you can imagine according to that understanding.

That is it. That is where you find satisfaction. The satisfaction that comes with that understanding is the harbinger of success.

The problem of the world is not the greedy rich people. Instead, it is those who don’t know how to use the cards life dealt them.

Watch it — when a rich man starts blaming people (especially publicly), his net worth starts to drop.

How to Create Money

There are several ways to create money. And I can’t talk about all of them here. But we will touch on the ones you should know about.

The ultimate way to game today’s financial system in money creation is to own a bank. Then, you can just walk into the vault as you like and enjoy a direct relationship with the central bank. This is why getting into the bank business is extremely difficult in first-world countries. They know.

However, the noblest way to create money that everybody can get on board with is to create value. One of the reasons we have such a fragile economy right now is that people stopped creating value.

With the promise to create value or solve an imaginary problem, they raise a lot of money. Then they spend lavishly and get in trouble.

But because they helped a couple of high-class people with the money they raised, those ones in turn help them salvage the situation. Now they can say, “We are sorry. We have learned our lesson. Now give us money again”.

We’ve had too many of those. And the financial system enabled that behavior. People going to solve a genuine problem and the investor says, “That is a $150 million market. We want a pitch from a startup that is eyeing a $2 billion market”.

So, is the $150 million guy a fool? Nope. He will change his presentation to make it look like they are going for a $2 billion market. Then, he will get the money and not be able to capture beyond 50% of the $150 million. And you know the rest of the story — the big flop.

Now more than ever, we need people who can create value. Not people who can inflate value. And this is how to make money available.

You can create money by changing the way people buy things or changing what they buy.

The Next Big Thing

In my opinion, the next big thing is the affordable luxury market. Everybody is still running around trying to figure out AI. But this is flying under the radar.

As interest rate increases, wealth inequality will keep growing. And it will gradually be that if you are not buying luxury, you are buying low quality. That middle ground will get thinner and thinner.

This is already happening. The surge in affordable luxury already took the CEO of LVMH to the top of the richest people in the world.

Luck? Maybe. But the psychology is undeniable. When everything goes super high in price, and people can afford less, they would cut their purchases of certain things and buy affordable luxuries just to keep feeling good about themselves.

This surge already started in 2022. The higher inflation goes, the more the demand for affordable luxuries.

Middle-income earners would rather cling to their affordable luxuries than live with the thought of being classified as poor. That makes sense to any thinking person.

I would rather cut my meals from 3 per day to 2, to afford a premium laptop for work. That thinking makes sense to people.

The biggest company in the world, Apple, is in the business of affordable luxuries. The iPhone, iPad, Apple Watch, etc. All are affordable, but they are luxury too, but not out-of-range luxury.

This is the biggest thing in the world right now. And it will only get bigger.

I rest my case.

P.S. I send insightful perspectives on success and money 3 times per week to my Inner Circle Community members. Join FREE here — 7d3.co