[Book Review] Money – Master the Game by Tony Robbins

The book is a 600 page guide and declares in the title page : 7 Simple steps to financial freedom. The book came to my reading lens after a friend of mine loaned me and praised the book, till half read. I was hesitant but the word ‘freedom’ pulled me to read the book.

The purpose of this review is not to rate / comment / refer / critique / rebut but to do something what most people will thank me for : encapsulation of 600 pages into 500 words. Incomplete but the alternative is reading 600 pages * 500 words = 3,00,000 words and not less easier than earning the same – $ 3,00,000 !

1. The author argues that each one can achieve financial freedom.

2. Financial freedom is defined by the author as : If you need $ x per month to maintain your current lifestyle (with aspirations), then one needs to build a Freedom Fund and invest in such a way that this $ x comes each month for next 20-30-40 years.

3.  Freedom Fund is elusive because most of the people are not good investors, they do not save, they do not understand tax and inflation, do not understand active manager fee (mutual fund portfolio), do not diversify, do not balance their diversified portfolios, do not understand sequencing (timing and order) and do not take the issue of financial future seriously.

4. For a freedom fighter, 3 things are crucial : a) allocation of assets b) diversification of assets c) anticipating the future – especially inflation and tax rates  d) achieving tax efficiency. e) respecting compound interest.

5. Loosely speaking, diversification may imply for a specific individual : 30% in stocks, 40% in secured return assets, 10% in long term annuities, 10% in long term bonds, 7% in gold, 3% in commodities

6. These percentages need to be ;’balanced’ – sold and re-invested in course of time.

7. One important aspect he teaches is to associate with a fiduciary. A fiduciary is a person who has no conflict of interest in providing you financial advice. He gives a nice metaphor. If you go a meat-seller and say what is good for health, he will say : meat. If you go to a nutritionist, he will evaluate and may not say meat all the time. The meat-seller is a general financial adviser and a nutritionist is a fiduciary.

The book is a good read and authoritative because of the author is a self made millionaire and he has interviewed and relayed advice from the topmost investors and financial experts of the world.

Recommended.

——————————-    My experiment with the book’s core model ————-

I am of the opinion that in financial matters, one should immediately put all advice into test, through a model. This is not difficult because money can be quantified and the problem (with some assumptions) becomes a mathematical equation, a rough and simplistic equation but a good model. Remember Bohr’s atomic model which was simplistic but was a useful starting model for as complex thing as atom. I asked a friend of mine and built a model :

Income needed per month = MI

Rate of return = 7% ( considered averaged over next 15 years)

Rate of stock growth = 10% (averaged over 15 years, conservative estimate. This includes the entry-exit points and to eliminate this, considered  to be  kept constant)

If he liquidates his business, then valuation should be  (MI + 30% MI ) * 5 = 1.3 * 5  * 12 =  78 * MI. Here, the 30% is the tax, 5 stands something like a valuation constant (depending on profit) and 12 for the months in a year. So, I get around 75* MI less debt (which is some 6 years of income and in theory can go on reading books and fishing for next 6 years)

Hence the Freedom Fund Looks like (FF)  = 75 * MI + current value of all all liquid investments + current value of all fixed assets

I do some calculation and find that FF at this moment for this friend with liquidation looks like = 75 * MI + 20 * MI + 40 * MI = 135 * MI  – debt = 132 * MI (virtually no debt)

It means that if this happens, the friend will be able to live without working for next 10 years. Why does not he do so ?

This can be explained by the following factors

a) Fixed assets are needed because we are an embodied being. We need shelter and place to work (home and office or home-office)

b) It is not easy to liquidate a business easily.

c) Even if this can happen, the return per month for 10 years need to be above inflation and principal needs to overcome crisis like 2008.

How ?

The books explains this. This I cannot do and you need to read and absorb and act.

As for myself, my advice to you :

Do get your financial advice from your grandparents who thought long term investment as annuity, liquid investment as FD, securing future in gold, insurance as only life insurance which you do because you love not hedge funds but your family, save for a rainy day, do not take debts, living below your means as if next crisis is around the corner, live in a such a way that what you need, you will have and you will not feel the absence of those you cannot  afford. In short, you become a philosopher and money and its thought at the highest level of refinement tells you this :

The energy called Money, like all the energies of the Cosmos belong to the Supreme Lord. He creates it, distributes it and at the end it comes back to Him. No one can own or hold money indefinitely. Either the money leaves him (stock-crash) or he leaves the money ( death). However, since money is a very powerful and isotropic and pervasive energy, it is to be respected and used judiciously.  Money itself cannot teach this, had it been so, all moneyed man could have been happy and enlightened.

If you are really interested in financial freedom, then the energy called money is capable of providing that. But the process cannot be brought by money.

This realization – the execution comes from practice and discipline which again money cannot give.

In summary : the book touches sometimes and remains, justifiably busier most of the time with the technicalities and I am not qualified to judge and test these processes and models.

 

 

 

 

 

Book Review: The Millionaire Fastlane by Michael Composto

A week back, while sitting in the TiE Conference in Calcutta, Mr. Suvrangshu Kar, Founder and CEO of http://www.erp2online.com mentioned about the book  and I had the book read in the same evening. This 15 mins conversation proved to be the greatest takeaway for me for the 12 hour conference. I did not attend it fully – rising temperature post winter, nice lunch and vicinity of my house from the venue forced me for an afternoon ‘power sleep’.

The review below is the result of that ‘power sleep’.

1. The Book declares that it is better to be a millionaire at 30 rather than at 70.

Translated : if your plan is to save, invest, speculate over a 30 year period while working, then it is statistically impossible to become real wealthy. For example, for an average worker to become a millionaire while working will take 146 years, even with the power of compound interest.  By some freak, if you become so, what is the benefit of wealth for you when you are 70 ? Your companions are not young women and boundless vigour of youth, but gout, arthritis, replaced knee, insulin vials.

2.Time is limited and is to be leveraged

Translated : Health and wealth but with locked time is worthless. If you find your time locked with your employer, your business, your enterprise and you are not able to do what you want or what you are passionate about, you need to reconsider your strategy. Kill your darlings – be it the job, business model, product or service.  Make sure you command your time.

3. Plant Money Trees 

Translated : If you observe your time, you shall find that you use most of your time for money.  The corporate workers work with 5-2 mode ( 2 days of weekend for 5 days of indentured time), a business owner’s time is spent most in getting investment, selling and collecting money. One needs to consciously mould his her business so that the business / investment works like a money tree. Consider a tomato groves. You go and pluck some tomatoes and you see that there are some more ready for plucking tomorrow after your sleep. The Money tree needs to produce fruits with minimum of your time spent.

4. Money is not scarce, time is 

Translated : Everyday 30 trillion dollars of money circulates in the economy and this is going to increase as Government is printing more money. In theory, money is in plenty while taken as a whole but your time is fundamentally limited. You do not get a single second extra than 86,400 a day. This is fixed. You can only leverage this, i.e. using a model, you can expand this time in relation to earning money. You need to select business models which allows this leverage. Otherwise, you shall remain a time indentured slave.

5. Select proper land, select proper seeds to plant your money trees 

Translated : Most of the mainstream models – business, education, investment, lifestyle are not time-leveraged. Hence, you need to select only those which will be fertile to grow your money tree. This means that you need to discard mercilessly any attachment to any ‘love to’ work, darling models. Automatize your farming of money as much as you can and with unlocked time, learn and enjoy. Do not learn for earning or having money. Learn because you need not think about money. You have your money trees.

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Afterthought 

The Book is disturbing because it challenges our mind-set and view of life. But that is the virtue of the book. It is insulting to our ‘darling’ : work hard and grow in life while becoming an indentured slave of a corporation or your customers.

It is very important for young men and women in their 20s and 30s to feel the jolt of the book.

The book will appear to be starkly and damn materialistic to an Indian reader. It is. Some will even despise the book’s admonition and more intelligent may even consider this as a mirage or will-o-the-wisp as to gather sales. That is not the ultimate point although this may be.

The book in its naked and unabashed hedonism in its subtle representation has arrived, unconsciously at the starting gate of spirituality : your attachment to your own prison cell, be it the proverbial cubicle, the business which is commoditized, you are bossed by customers, vendors and employees and sucking your time, your lifestyle which is pushing you to sell more and more of your time for less and less, your inhibition to learn new skills and to forget old ones.

In short : Highly recommended book.

Postscript : A personal anecdote 

1996 – 2004 : I was a corporate employee and 2920 days worth of time was sold for money, not a large money but  subsistence money.  Even selling 2920 days in a row, I had to again work for a nominal lifestyle. I invested mostly in building 6 flats in my ancestral house. These are rented now and is one of the money trees.

2005 – 2010 : Left job to build a business (www.wordsmithcommunication.com) and which forced me to automatize in a way to free more and more time for me. I had fired clients who demanded more times, endured revenue loss but continued and did build two businesses which were completely automated. These businesses sold videos, tapes and books of other people. The business did not boom but high automation and no demand on my time made sure that I can learn more skills. The automated businesses were the money trees.

2010 -2015 : Attempts to automatize more and more and looking for fertile grounds with a plan to retire in next 10 years to pursue a passion : Plain Living High Thinking  till death. The project itself can be considered as a long term preparation for death.

 

How does a wordsmith work ?

Winter in a predominantly tropical city like Calcutta restrict outdoor activities for me. So, I thought of narrating not a very typical day in my life. A wordsmith work is more like a craftsmen and a craftsman’s life does not vary much even if you go thousands of years back. A technician needs many tools and machines, a craftsman’s tools are simple and ancient : words, chisel, brush, potter’s wheel, knife and so on.

2 years back I wrote a diary – Daily Diary of a Freelancer.

Let us see what did I do today

I translated some 700 words into Bengali in the morning. The translation was related to a medical report. Then I helped some clients getting some 6000 words worked in six languages spread in all the continents. I wrote couple of marketing letters – an assorted salad like and sent to various leads.

Wrote a short summary of a foreign language learning programme and had this sent to a DTP team for design.  One of the languages was Greek and then watched a 40 min documentary on ancient Greece in youtube  – the age of Pericles and that reminded me reading a book by HDF Kitto entitled The Greeks. It also reminded me that our Rennessiance Club meetings are little like Greek Symposium by design where one meets, eats and discusses – not about stocks and trades, vacancies and profiteering, office-woes or celebrity gossip, mobile update or facebook victories.

I prepared a dish after reading this in a blog post where the author teaches how to fry a sliced aubergine and then preparing a paste made up of yoghurt, pepper, cardamom, fenugreek and aeostifedia. It tasted great.

Finished and proofed the translation and delivered. Client, a Briton acknowledged with a terse ‘thank you’ and then wrote a blog post. Read two wikipedia entries : Themistocles and  and Sophocles – whom the documentary mentioned. I learnt from the ancient thinkers that greatness is so ephemeral that a nation can sink to rank mediocrity within a generation.

Followed up with some previous projects and alerted a client that our delivery will be delayed 24 hours due to reasons I cannot control. Client solaced me and comforted by this, I thought of watching another report on Geopolitics which tells how geography is, one sense destiny. The same report told me why Russia from Czars till today wants to expand because in the East, between the last frontier and Moscow there lies no natural barrier and only plains. The only natural obstacles are winter and fatigue of enemy troops. Both proved fatal for Napoleon and Hitler’s armies.

Then made a call to a friend who is a co-presenter in a workshop for translators on 17th January – Job, Career and minor global fame being a translator or interpreter workshop. He told me that one of his friends need some voice recording in Bengali and then called a studio owner here – a small business and they started conversing.

Checked with a friend’s friend who had access to some fine illustrators and sent an inquiry to that effect. The illustration is needed for a book I had long written but not published formally – The Calcutta Culture Glossary  and waiting for reply

As it became evening, the air became chilling and drank some tea and thought of watching another 40 mins movie. Napoleon and the defeat in Russia kept my mood sombre and Darjeeling Tea also could not lift it up. So watched The Adventure of Napoleons of Sherlock Holmes and got delighted (once again) by the great tablecloth trick by the great detective and the great actor who played the role – Jeremy Brett.

The detective in London stimulated me and I thought of again attempting a long pending translation from Bengali to English and progressed considerably. After 1000 words completed, I felt tired and feet became colder. Resigned myself to the bed and checked the mail box to see that except some harmless promotion and received, there is nothing.

I conclude : my work-life, in a general sense is exceptionally boring. I am trying to inject some steroid of excitement into it using association of ideas and through a make belief of work.

 

 

 

How does a corporation work ?

It is incredible but most of the people who work in a large corporation do not know how does a corporation work. TCS, a major Indian IT corporation has announced and went into ‘terminating’ employees. The matter has reached Court. Our mainstream media is busy with the news.

Our task is not to join the debate but the duty is to ask something which will help us better to know what is happening, why and what are the possible future configuration.

The best image that will help us to start our attempt to understanding is the story of 4 blind persons and reporting back about an elephant.

1st Blind : Considers corporation as a configuration (an animate object) which has manifested because of certain conditions of space and time, will remain and then will change into another configuration.

2nd Blind : A corporation (tusk of an elephant) is like a valuable jewel and this needs to be protected from internal and external threats. For this service, these set of people demand various powers and privileges. One of this is to decide who is needed, who is not needed, who is worthy and who is not worthy. In short, they are the administrators.

3rd Blind :  They consider corporation (belly of the elephant) as something which needs to be filled-in. They gather money, trade know-how,  get clients, negotiate with vendors, deceive clients but with the sole and singular objective of feeding the belly. They are the sales force. They sell and they buy (to sell).

4th Blind: They consider corporation ( as the rear of the elephant) as something that needs to be needing continuous clean-up, re-work. They also cannot do any of the other things by natural temperament. They are the largest in terms of numbers in a corporation.  The more 3rd blind fill-in, the work increases proportionately for this group.

A corporation’s normal working mode is a tacit agreement between all 4 blinds that they are blind or have impairment.

There are following malfunction modes and their gross manifestations are detailed below

 1st Blind : Due to hierarchy, 1st blind group faces threat from 2nd and 3rd and or their combination. They simply leave. So when you see in a corporation that such people are leaving and they invariably do so in silence, you may conclude that there is a conflict with 2nd group or the organizational ship is sinking. The 1st group sensed it.

2nd Blind  : They face threats from 1st and mostly from 3rd. 3rd people (the sales and traders) argue that these people are simply there and no external and internal threats exist. This comes as a ‘hot money’ effect. If you see tremendous turmoil and loud fights, you can conclude that 2nd people are fighting an internecine war or 3rd group is inciting it or combination. This can continue for a very long time.

3rd blind : Their threat comes from 2nd and 4th group. They enter into truce with 2nd group, fund a faction in 2nd or fund promising ambitious ones in 4th category.  They generally avoid great fights as this creates turmoil and hinders the process of filling the belly of the organizational elephant.

4th blind : This category is largest in number but least focused.  They remain separate and since they are manipulated by 3rd and their front and side view completely closed due to the large elephantine organization and the incessant work issuing forth, they even do not sense that the elephant is no longer an elephant but is morphing into a different animal and instead of a stately gait might have acquired the habit of kicking. They only leave when the kick actually forces them to change co-ordinate.

The Full Picture 

Backed by my own experience in working in the elephantine organization and from countless number of hearing from others, here is the full picture :

A corporation (French : couer meaning body/tangible) is an organic engine with head, arms, belly and legs. The head thinks where is the food and directs the arm. The arm  goes with the help of the legs and gathers the food. The food is now sent inside the belly which nourishes all the other parts of the body – head, arms, legs and itself.

The interesting question is ask when a corporation does not work. It does not work when the following happens :

a) There is no head function. The organization is a brainless body.

b) There is head but no arm. The organization cannot  gather nourishment. It cannot even drive a threat like a fly away. The head in course of time gets physically damaged.

c) The belly, without a head and a arm thinks wrongly that there is no point sending nourishment to other parts and appropriates all. The result is indigestion, bloating and cessation of the process of digestion itself.

d) The arm fights but does not satisfy the belly. In course, arms go weak.

e) The legs refuse to carry the head, belly and arm. It conspires with the belly to carry belly only and not arms and head. The corporate body falls down on the belly and rots.

***********************************************************************This model of corporation can be easily extended to family, community, nation and international entities. This model holds true from a nation of bacteria to an inter-galactic  nation of aliens.

 

 

 

Wordsmith University’s new training on Job, Career and minor global fame being a translator and interpreter

I meet many corporate workers in India and in their private conversation, I detect a sense of deep insecurity and powerlessness. They feel that even though they have many skills and competencies and proven as these are, any ‘optimization’, ‘restructuring’, ‘corporate mandate’ , ‘disruption’ will overrule these. This is fact and they know it.  There is a fear because of this and this fear reflects into various kind of ‘alternatives’ people indulge in. The alternative includes ‘stock market dabbling’, ‘real estate investor play’, ‘running a business in spouse’s name’ and many more. But if their regular office-going is to be factored in, none of the alternatives give them the confidence and the fear remains but is sedated with a placebo that the alternatives are being worked upon.

Long back, somewhere in 2000, while I was working as a corporate man, I was thinking of how to establish a single hop between me and my earning. After many diversions and zig-zag (detailed in my business autobiography – Wordsmith Book of Business), I became a translator of 4 languages and eventually started an agency.

When I started as a translator, it was not an alternative play. It was the only play. Today, after eight years of running a business, I felt that I still need to establish a direct connection between me and revenue. I need to be a craftsman again, over and above a business owner.

Last year, in a cold winter evening, a very senior corporate man finding danger ahead in terms of retaining the current-salaried position and job told me, wistfully that how much he wants to have a ‘craft’ which he can ‘practice’ and earn a modest living. The example he gave was that of a doctor of old time, a small mechanic or a goldsmith. What he tried to tell me was this : I want a process and model where I can be a craftsman with a direct control of who chooses to pay me rather than being part of a ship run mostly by strangers.

I found translation, cultural consultation as the trade for me. I also found that I am part of a guild with a level of experience and I can learn more from the senior members of the guild and help the junior craftsmen of my domain. http://www.wordsmithuniversity.com was the result of that thought. We have taught worldwide : online and offline and collaborating with similar senior guild members from China to Brazil and Moscow to Sydney.

We are now trying to do this in home territory. The first attempt is below

Job, Career and minor global fame being a translator or interpreter workshop

Have a great New Year ahead !

Trados Training for translators in Calcutta/Kolkata by Wordsmith University

Last week, Wordsmith University conducted a TRADOS training for freelance translators. The training programme was successful because of the following reasons

1. We wanted the programme to be intimate, informal, relaxed and full of substance rather than distant, one-directional, formal and costly and more frills than value.

IMG_0092

Trados Training in progress

2. Our associate Prime Infoserv, one of the leading System Integrating and Consulting Company kindly lent their Conference Hall which was just the ambient environment we needed :  quiet, compact and one to one interaction. We limited the number of entries and that made it possible for the training to become  intense and beamed.

3. Mr. Pinaki Talukder, translator, agency owner and trados expert taught how to handle the tool, interrupted by a traditional Bengali lunch. It was great to drink coffee overlooking the Salt Lake skyline in the evening in the break as buses plied lazily in the road towards South.

I spoke mostly about business development for freelancers and how to write effective marketing emails.

See our next training for our tribe here :  Job, Career and minor global fame being a translator or interpreter workshop

Indian IT, 40+ Indian manager, Life-Designing Opportunity

Almost a year back, I kept my appointment with my 40th year and as a mammalian trait, I developed an extra love for my tribe of 40-ish man of contemporary India.  The love triggered in considering the current and future plight of 40+ professionals of Indian IT industry. My group means normal, decent professionals and not super-bright, super-achievers : in technical skills or political skills.

I heard recently that TCS – one of the largest Indian IT companies had announced a major reduction of existing employees. I think no one knows the underlying mathematical model  and Formula 40  of deciding the individuals who are to be ‘sacked’, ‘removed’, or to be labeled as ‘ martys of optimization who sacrificed their job  so that the organization can survive and grow’.

Now, I have learnt something called perturbation theory which says that if some process is so complex and you are completely clueless, you assume a formula (as if you know, like let us say x in algebra) and apply the theory to see whether facts fit nicely, reasonably, irrationally or nonsensically.

Let us call this Formula 40

Formula 40 now takes the following structure and process flow

1. 50,000 freshers @ INR 3.5 L per annum = X * (average 40+ professionals with salary of 15 L per annum

2. To balance the equation, we find X = 12,000. I hear that total reduction considered is close to this number. See the power of perturbation theory !

It means that not a single paise in balance sheet will change (other factors remaining same) if 12,000 – 40+ people exit the gates with a non-functional access card is equivalent to 50,000 entry with bi-directional passes. In non-technical terms, if 12,000 40+ employees can be ‘whacked’, 50,000 new and fresh soldiers can be immediately recruited.

————————————————————————————————–

Other Factors 

Other factors are never the same. Rather the ‘other factors’ is the factor that forced a brilliant employee telling me something like this. I am using the most sublime code ever written by man – rhyme.

When I was one like this 50,000 ; 15 summers back ;

I longed for experience and age for that was the yard-stick.

I longed for the promotion and the hike thereof

I also felt that I have got knowledge and experience enough.

Formula 40 came like a storm, it was after all, a number game

To balance the equation, every person looks all the same.

I have defended my organization a million times to  customers fiery,

But I was never  taught as  how to justify my hiked salary.

I worked hard Sir, slept in the mattress in cold nights in colder climes;

“That is fine for history Sir’, we are are in a different time.

The phone rings and the hand gets frozen. 

Colleagues whisper, a crisp as the knife of an assassin, unknown.

————————————————————————————————

The 40+ men of Indian IT industry today were the 2nd wave of people India sent to Western shores first and then a part of them established the IT phenomena in the homeland. For a true historian, this generation of India (which is also my generation) will be recognized and given their due. They faced the following in their flower of youth :

a) barrack some living

b) Ghetto living for the most

c) Back-breaking work schedules and managing the managers who over-committed

d) Cold climate and fighting time zone

This generation is now passing by the inexorable law of historical evolution of the industry and history in general.

The Opportunity 

For many of the 40+, the call of the optimization assassin will come. This will be as objective as we reject a solution of a differential equation as physically unsuitable for the physical problem we are solving. We do not dislike the solution, we have no hard feeling. It is simply the context of the problem. The Law of Causation is suspended.

The opportunity is to feel this in one’s skin and neural system and to one’s soul.

To the most brilliant group of this 40+ in Indian IT industry

Your temporal organization is not and will never be capable but the judge of history will give your due. You have served the industry and country well.  You have upgraded / optimized / redesigned so many processes – external and internal of clients. But you never had the time to ask in such busy-ness : How shall I design my life  ?  What is the purpose of my life in the broadest sense ? What shall I tell, as the essential essence of my experience to the horde of 50,000 entering in….. 

You are finally, you may know or may not, at the tremendous opportunity : The opportunity of being a Li-Der, a Life-Designer.

A handshake in thought and a salute, my generation, my friends, my colleagues !

* I had been an auxiliary foot-soldier of the industry from 1996-2004. Auxiliary : I worked for the industry that helped bits move to and from from Indian shore to Western shores cutting across ionosphere and exosphere, oceans through fibre optic cables and through potable radios. I also supported customers for an Internet account called shell account, i.e. Internet through a window which is only available now in the command prompt window with black screen and a strangely white text. I was a telecom-wallah.