The Psychology of Winning...
Monday, December 11, 2006 | Jason JovineI have read very many books on psychology in my life, and I have also met many interesting and wonderful people. I have learned a lot from them. Some of them include Jack Welch (former CEO of General Electric,) Hillary Clinton, and even P. Diddy (or whatever he calls himself nowadays.)
I must let you in on a secret. The secret is that if you understand psychology, it can help you both personally and professionally. When I predicted the latest bull run, I did it using economics as well as psychology.
I thought that I would deviate from my normal "strictly business" attitude today and offer some adivce on " The Psychology of Winning".
I want to make one thing crsytal clear to you all. Whatever I write in this Tycoon report, it is the best advice that I know how to give. I may not give you the best "dog and pony" show with my writing, but my advice is more solid than 99.999% of the stuff that is out there.
I will make mistakes, and I will admit them, but I do want to have a relationship in which you know that when you read something written by yours truly (JASON JOVINE,) you will know that it is sound, no-nonsense advice.
Most of the people who write financial newsletters don't even truly know the difference between a stock and a bond, and they have the audacity to ask the public at large to invest their money in their suggestions.
The Psychology of Winning...
1. ALWAYS SET GOALS
You need to write down your short and long-term goals. Do not take this one lightly. Having no goals is like driving a car without a destination; it is absurd. Whatever you want in you life, you can get if you work hard and work smart.
These goals can be any type of goals. They can be financial, relationship oriented, physical, etc. Make sure that the goals that you set test you, but at the same time, make sure that they are realistic. Always remember that you have to crawl before you walk and especially before you run.
2. NEVER GET COMPLACENT
I have done this myself. You may think that everything is fine, but life has a way of throwing curve balls at us out of nowhere. I don't care if you are a succesful doctor, lawyer, or janitor; you are not entiled to success - it has to be earned each and every day.
What you did yesterday has nothing to do with what you will or won't do today. Remember, everyone , that we are competing globally now. Your job is always at risk, so you always need to learn new skills and be better than the competition that lurks right around the corner (or the world.)
3. DO YOUR HOMEWORK
Whatever you want in your life, whether it is a better job, house, or spouse you need to research what it takes to get it. Many people use role-modeling; they find someone who has what they want and they do what the "role model" did to get it. Since I always watch the economy, I think that a wonderful resource for getting a better layout of the job market and its outlook is the Bureau of Labor Statistics (www.bls.gov).
On this site, you can click on the "Occupational Outlook Handbook" to see what the best jobs of tommorrow will be or what the highest paying jobs are. Remember, your net worth (unless you were born with a silver spoon in your mouth) is determined by what you make and what you save as well as how you invest what you save.
Always run your household as you would a corporation, and KEEP YOUR COSTS LOW. I have met plenty of people who have made more than I have, but they had less to show for it because they spent like drunken sailors. This is a huge problem in America. Americans actually spend more than they earn (we have a negative savings rate.)
4. LOOK AT YOURSELF IN THE MIRROR
In other words, you can lie to the world if you want, but you can't lie to yourself. In marketing, they do what's called a S.W.O.T. analyses. S.W.O.T. stands for strengths, weaknesses, opportunities, and threats.
You should always be aware of your own S.W.O.T. Strenths and weaknesses are internal, and opportunities and threats are both external. Know yourself and use what the man upstairs gave you.
5. TAKE CARE OF YOURSELF PHYSICALLY
All of the money in the world is totally meaningless if you can't enjoy it. You only have one body, and it depreciates before you know it. Challenge yourself physically, stop smoking, and do your best to take care of yourself.
This, of course, does not guarantee that we will live to be 100 years old, but if you take care of yourself, you increase the probability of having a happier and healthier life.
6. BE SPIRITUAL
I don't care what you believe in, but try to find that connection with whatever force caused you to be here, and do not take it for granted. Out of this vast universe, the probability of your being the highest evolved creature on the beautiful planet Earth is extremely low.
7. HAVE PATIENCE
The final point that I will make is don't get discouraged. Hang in there. Make sure that you follow your goals and be sure to be flexible. If something is not working, then try something else.
Until the next time, folks, spend your hard-earned money wisely.
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Jason Jovine
Contributing Editor
The Tycoon Report
MARK YOUR ECONOMIC CALENDAR – What’s ahead for the week of December 11th.
Monday, December 11th, 2006
10:00 Wholesale Inventories: Consensus 0.6%
Big Picture: Wholesaler inventories growth of 10% yoy compares to 8% yoy growth in sales. The inventory to sales ratio bottomed at 1.15 months from May - July but is likely to return. The long term trend suggests comfort at these low levels of available stock as technology allows for continued improvement in just-in-time inventory management. The smaller inventory swings from rebuilding and draw downs leaves a steadier pace of domestic growth.
Tuesday, December 12th, 2006
8:30 Trade Balance: Consensus -$63.5B
Big Picture: August topped the record July 2006 deficit as lower energy prices provided a retreat in September and another likely decline in October. Despite the record level helped by petrol prices the trend appears to be flattening after the strong late 2005 lift. The power of petroleum import prices and strong domestic demand for foreign goods is loosing its control as exports feed a stronger world economy and the weaker dollar slowly reduces import demand. From a year ago exports have risen 16% as imports have risen 9%. Import growth carries a larger effect on the deficit than exports given that imports are more than 50% larger. China commanded a record 36% of the entire deficit in September. The massive size of the deficit is eyed for effects on the dollar and interest rates. The trade deficit demands an equal but opposite investment inflow from abroad as the record size urges caution regarding foreign demand. But foreign demand remains exceedingly strong given the return of petrodollars and as Asian export markets protect strong trade flows with dollar buying.
14:00 Treasury Budget: Consensus -$74.0B
Big Picture: Tax receipts continue to run strong and left a -$248 bln FY06 budget deficit. Strong tax receipt growth has returned with the stronger economy, profits and income growth. Spending remains stronger than desired (7.4% avg yoy growth) as fiscal discipline is needed. The FY05 improvement sliced away a quarter of the record $413 bln FY04 deficit as FY06 sliced away another $71 bln -- far better than expected given the Gulf Coast spending, war costs and government spending restraint not yet demonstrated. Far more progress is needed to continue to slim the budget. The outlook is for a larger deficit in FY07.
Wednesday, December 13th, 2006
8:30 Retail Sales: Consensus 0.2%
Big Picture: Retail sales are slowing under the weight of higher interest rates as lower gas prices will provide a boost in the months ahead. Strong retail sales growth had been fueled by low interest rates, vehicle discounting and mortgage refinancing as those forces faded in late 2005. Despite the improved employment and income growth the Fed tightening and high energy prices have had a deflating effect on consumer spending and big ticket durable goods purchases particularly. Income growth provides support and is the best read on the future sales pace.
8:30 Retail Sales ex-auto: Consensus 0.3%
Big Picture: Retail sales are slowing under the weight of higher interest rates as lower gas prices will provide a boost in the months ahead. Strong retail sales growth had been fueled by low interest rates, vehicle discounting and mortgage refinancing as those forces faded in late 2005. Despite the improved employment and income growth the Fed tightening and high energy prices have had a deflating effect on consumer spending and big ticket durable goods purchases particularly. Income growth provides support and is the best read on the future sales pace.
10:00 Business Inventories: Consensus 0.5%
Big Picture: The inventory to sales ratio returned a record low 1.25 months in May as inventory gains (8% yoy) compare to a 5% yoy rise in sales. The lean inventory supply is intended and shouldn't require major rebuilding as the I/S ratio trend argues that technology continues to shorten inventory delivery times and need. While the low inventory levels are having a positive effect on production and adds to the strong pace demanded by sales. Longer term rebuilding should be modest given continued improvements in inventory management which don't require as much stock in the warehouses and lots.
Thursday, December 14th, 2006
8:30 Export Prices ex-ag.: Consensus NA
Big Picture: Ex-petrol import price gains have fallen off Oct's decade high of 3.8% yoy to just 0.5% yoy. With the recent declines petrol prices are -3% yoy to leave an -0.2% decline in total import prices. China and Japan and now Canada show outright yoy declines in import prices.
8:30 Import Prices ex-oil: Consensus NA
Big Picture: Ex-petrol import price gains have fallen off Oct's decade high of 3.8% yoy to just 0.5% yoy. With the recent declines petrol prices are -3% yoy to leave an -0.2% decline in total import prices. China and Japan and now Canada show outright yoy declines in import prices.
8:30 Initial Claims: Consensus NA
Big Picture: Initial claims broke above the remarkably tight range held in the 4-week average for 5 months. Continued claims showed a five year low in the 4-week average in mid May and stands only 68K higher today. The continued low levels reflect the thin available labor supply which make a qualified hire difficult to find and therefore leaving less layoffs. A good read on the labor market as net hiring slows with the economy.
Friday, December 15th, 2006
8:30 CPI: Consensus 0.2%
Big Picture: The core rate of consumer inflation reached a decade high of 2.9% yoy in September before easing off to 2.7% yoy. With economic growth fading further core price declines may be more rapid than earlier expected. However, the sticky prices for shelter and medicine and tuition will remain firm. Energy prices have provided the drop in overall CPI over the last few months and are now lower than a year earlier. In the big picture its aggregate demand which provides the price direction as the weaker growth will eventually ease the core inflation pressures. The Fed more closely watches core PCE prices as an inflation guide which stands at 2.4% yoy. Overall CPI reached a 14 year high of 4.7% yoy in Sept given the push from energy prices and now stand at 1.3% yoy.
8:30 Core CPI: Consensus 0.2%
Big Picture: The core rate of consumer inflation reached a decade high of 2.9% yoy in September before easing off to 2.7% yoy. With economic growth fading further core price declines may be more rapid than earlier expected. However, the sticky prices for shelter and medicine and tuition will remain firm. Energy prices have provided the drop in overall CPI over the last few months and are now lower than a year earlier. In the big picture its aggregate demand which provides the price direction as the weaker growth will eventually ease the core inflation pressures. The Fed more closely watches core PCE prices as an inflation guide which stands at 2.4% yoy. Overall CPI reached a 14 year high of 4.7% yoy in Sept given the push from energy prices and now stand at 1.3% yoy.
9:15 Capacity Utilization: Consensus 82.2%
Big Picture: Industrial production stands at 5.6% yoy growth as manufacturing ex-autos is running at 7.2% yoy, but the pace is slowing. The strong annual growth is tied to strong business capital investment which brought strong and sustained growth in factory orders and production. Weaker business confidence in the economy is creating a slowing in capital investment. Capacity use stands at 81.9% -- near the level historically consistent with the start of bottlenecks and rising pricing pressures.
9:15 Industrial Production: Consensus 0.2%
Big Picture: Industrial production stands at 5.6% yoy growth as manufacturing ex-autos is running at 7.2% yoy, but the pace is slowing. The strong annual growth is tied to strong business capital investment which brought strong and sustained growth in factory orders and production. Weaker business confidence in the economy is creating a slowing in capital investment. Capacity use stands at 81.9% -- near the level historically consistent with the start of bottlenecks and rising pricing pressures. (Source: www.Briefing.com)
