Act On Your Knowledge

wealthymatters.comThe diagram on the left is from

It drives home a very important point:If you would be wealthy knowledge is important, but acting on your knowledge is more important.You make money in proportion to the amount of Right Action you have done rather than Right Information/Knowledge/Thoughts you have.As the author puts it ” Knowledge is not possession, this is to say that to know does not imply automatic acquiring; it merely opens our eyes to possibilities and like belief, it must be acted upon for it to yield fruits…”

A person who picks a good stock at random and a person who does so using a fundamental analysis of the company are at the same situation.They have arrived at the right prospect.Now the important thing is who buys how much and hangs on to it.The only advantage the person who can do the analysis has over the other is that he can find other opportunities.But in life just one right decision and one right action can make a person wealthy (and the reverse is also true.)

An action bias is fundamental to becoming wealthy.Knowledge,experience and patience just help fine tune one’s ability to accumulate wealth.

Wait or DO?

The $100 Startup

wealthymattersBusiness interests me and big business,should I be the founder or promoter, I suspect would interest me more.However I understand the need to start as a solopreneur or to start a micro-business, if for no other reason  than that my risk capital might be small or that I might not be sure enough of my skills to pull the venture off or that I might wish to test a business model or its component systems or that I need to limit the risks of launching an untried product or service.This sort of inclination naturally draws me to bootstrapping.I guess at heart I am a Dhandho Investor ( find venture fund driven start-ups wasteful of capital and think they unnecessarily increase the chances of a business failing by  trying to do to much too soon, before systems and products are fully tested.My personal take is that venture funds are the product of a society with not many good investment opportunities and  a lot of excess financial capital hoping to turn some returns any which way. Read more of this post

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