When you think about the economy of the future, what do you think about? It might include electric vehicles, wide use of solar power, and many other options. At the moment, one of the driving forces to bring these ideas to reality is Elon Musk who made a great deal of money through pay-pal and invested it in Telsa, SpaceX, Solar City and other things. When he began his investments the infrastructure did not exist, thus his story makes a wonderful read. One of the books about him is called Elon Musk by Ashlee Vance published by HarperCollins, NY, 2015. Often people believe if you made millions, you can establish brand new worlds, although it is possible, it is also expensive, which is why most people only do a part of it. Elon Musk was fortunate he was able to do 3 industries and to have sales pick up, just as he need even more money to continue the work.

There are many themes in the book, however, the power of the information age, having people work long and hard for you; who have bought into the dream and want to make reality gives any country hope in the future. Mr. Musk and his teams of people examined closely what systems exist from the established companies and then determined it was easier and less expensive and having more control if you do it yourself. For example in the early days of Detroit – Henry Ford, GM and other auto companies were vertical integrated or produced just about everything you see in the car. Now days the companies do the final assembly and the sales and marketing end, but not necessarily the pieces. There can be very good reasons for the change. Mr. Musk decided it was easier and better to build in one factory, perhaps as the numbers climb and the prices fall, things will change, but for now his companies are vertically integrated.

There are many interesting aspects of the book, for example recently there have been many recalls from the auto companies, with Telsa, it is similar to the Microsoft improvements (at least for this computer receives). The software companies send an update through the internet and your machine is updated. Telsa can send a software update and the car is updated to the better features.

Linking to dividend paying stocks, Mr. Musk’s companies do not pay dividends and are still valued as growth companies. It depends on how fast they grow for the stock to grow. An important takeaway is how the industries were created and the vacuum the older established companies left in the market. When a company brings in dividends because it is making profits it controls some aspect of the market. There are edges where new competitors can compete, because the larger company does not really want to be there this is where Mr. Musk’s companies has an edge and used it.

There are more questions than answers, till the next time – to raising questions.

If you are a sports fan, and many are you would love to be the General Manager and there are people who have come close to the job. One author is Tom Callahan who wrote the book The GM – The Inside Story of a Dream Job and the Nightmares that go with it published by Crown Publishers, NY, 2007. Mr. Callahan was able to be the fly on the wall of Ernie Accorsi ‘s office who was the General Manager of the New York Giants football team which plays in the NFL. In New York, as long as the New York football teams are competitive the New York Giants are the most commented on team which means listening to the fans is both a blessing and understanding that everyone has an opinion. Part of the job of the GM is drafting and signing players to be on the team – if they perform well on the field the city and fans are happier. If they do not, opinions quickly form. If you think about the NFL – all the teams should have or do have done analysis of every player particularly in their backyard and extraordinary players should be on everyone’s radar. How one player comes to a team and not another is the story of people led by the GM. To pick a player, Mr. Accorsi noted a football team is like a jigsaw puzzle with a lot of oddly shaped pieces. However, despite everyone having a read on each player, how they perform together is the unknown. If your subject was people in battle, they do not fight for their commander (although they can respect him) they fight for their teammates or buddies. How do you know this person will fit in and their teammates will fight for them?  Sometimes the team overlooks somebody who went later in the draft, Mr. Accorsi has gone back to see did we miss something or how did we miss it? It turns out at least one of the scouts had the prediction accurate, they were just in the minority.

Another aspect of the GM’s job is hiring the coach for they should be thinking along the same lines. In the book the GM needs to hire a new coach and the thinking of the process is outlined. The coach worries about the execution of the plays, the GM worries about getting the players to execute the strategy of the coach. According to Coach Coughlin coaching is making players do what they do not want to do so they become what they want to become. The GM and the Coach worry about their players – the starting players are millionaires who like all people some are good with their money so are not. Some love to be in the media, some are more behind the scenes. What goes on in the field is the just the beginning.

To learn more about football and the inner workings of the game, the book is an interesting read about the behind the scenes and dealing with trying to keep a club competitive through draft, ownership, and execution on a weekly basis.

Linking to dividend paying stocks, the New York Giants have a long history of making money and consistently challenging for the championship, how the team functions one can learn from them. All teams go through cycles, all teams have concerns with ownership, but to be a consistent money-maker is something anyone can learn from. If you are a fan apply the learning to companies on the stock exchange and it will help pay for your football activities.

There are more questions than answers, till the next time – to raising questions.

If you love movies, you will notice more companies are bringing out sequels or the new in a series. Many people around the planet have seen more than one movie and develop favorites. Two of the sequels coming out are James Bond and Star Wars. As a fan of either you are waiting see the movie and likely will go to a movie theater to watch it. If you wait a couple of months, you can see it on You Tube or a movie streaming channel. As an investor, there are alternatives to make some money which includes more than you paid to watch the movie at the theater. Movies are shown in a theater – many are owned by public companies; the movie distributor is often a public company; most successful movies have a merchandising tie in – observe the characters which inhabited the schools for Halloween and Christmas season is coming what will you thinking about buying for children those companies can benefit. As you can see from the examples above, there are many alternatives and as investor you will need to pick one. Many years it is hard because while the movie may be popular for the companies to increase their share price they need billion dollar hits rather than multi million dollar hits.

Linking to dividend paying stocks, you start with the idea, how to capitalize on an expected movie hit which appeals to a broad mass of the public which is great. The next step is to research which alternative you believe will most benefit and by picking companies that are successful or pay a dividend, if on the off-chance the hit is not a billion dollar hit, but a multi million dollar hit you still will collect your dividends along the way. The public is the right when they choose their entertainment, you win by picking the best of among the alternatives.

There are more questions than answers, till the next time – to raising questions.

In the Globe and Mail, Harvey Schachter wrote an article reviewed James Stegmaier’s book A Crowdfunding Strategy Guide: Build a Better Business by Building Community. Mr. Stegmaier has used the Kickstarter website to raise money for new business ideas because new ideas need to find financing and a market of buyers and Kickstarter helps do both. Mr. Stegmaier believes you has tips for you to succeed. The basics are simple – start a project page with an explanation of your project with enough detail to attract support. You name an amount of money you are trying to raise and if you do the project gets funding, otherwise you owe Kickstarter a fee and no money is exchanged.

To ensure success there is work involved. You need to build a community that will not only welcome your idea but willing to put up some of their money. This means not only talking to friends and family but people who should be easy adapters of the idea. Before you launch you need to build momentum because reality generally means if you are 15 days into your campaign and only raised 10% of your target money, you success is generally going to be limited, but there are exceptions. Kickstarter longest campaigns last 60 days, but Mr. Stegmaier recommends a month 28 to 35 days.

The two biggest mistakes people make is although it is possible for anyone to create a webpage – the difference between a good one and medicore one is easily seen (either gain experience or hire a top flight designer). The other mistake is underestimating the costs involved. Those in the know (and there are many of them out there) will quickly see while it may be a good idea, the chances of implementation with your costs are very low and will pass.

The nice thing about Kickstarter is a wonderful method to determine if your idea is a good idea but will people pay for it? if the natural users will not, why would the public? Use it, learn from it and try your ideas.

Linking to dividend paying stocks, unlike new ideas, these companies have products and services that are well tested by the market place and the market place decides everyday. There are always things to learn about the processes, but do not invest in a Kickstarter project for dividends, you are after capital gains. All companies go through the process, even dividend companies are constantly in search of good ideas to implement which the public will pay for.

There are more questions than answers, till the next time – to raising questions.

Recently in the Globe and Mail under the heading A Stash of Cash for Bargaining Hunting an article was printed which can help all investors. Everyone in the investing world discusses how to buy, what to buy, but less often what to do or how much cash you should keep. We all know markets go up and down, when the markets go down it is a great opportunity to buy, hold and then sell and repeat. The issue with cash is the returns are less than being invested, however it is important in your portfolio to have cash ready to be able to buy when markets and the stocks you follow are seemingly bargain prices.

One of the money managers interviewed said as a value investor he generally selects stocks of good companies to buy and hold for the long term, but that does not mean holding on to it forever. If the price gets too high and the market is willing to pay a premium beyond what I believe it is worth, I will sell. Once sold, I look for other ideas or I will wait and it can be a number of weeks, cash can build up.

Think about the statement  – need a plan going in; need to know when the price is too high; and need to have patience. All that takes discipline, homework  and experience to do it on a regular basis.

Linking to dividend paying companies, stick to the fundamentals – buying and holding good companies that pay dividends in that manner the cash builds up and when markets offer bargains use the money to buy into the equity markets at great prices.

There are more questions than answers, till the next time – to raising questions.

Gary Kinder the author of Ship of Gold in the Deep Blue Sea, Random House, NY, 1998 essentially wrote 3 stories in one  – the first one a description of turn off the century California when gold was discovered. Then the story of the travels between the ports of New York and San Francisco with a stop through the Panama Canal, together with the reports of what the hurricane was similar to. The next story is the person who discovers methods and ways to search for the gold – an amazing creative engineering mine of Tommy Thompson who has to make discoveries to work in the deep oceans. The last chapters are what happens when gold or valuables are discovered. Who do they belong to and who should see them?

In the world of venture capital, often times there is a need or request to put more money into the venture. One method to look at is: in entrepreneurial ventures you often have tests; you have the pro forma and the actual and invariably something happens in the actual which tests the mettle of the managers. It is how they handle that really determines what the group is made up of.

In the above case, the group had found what they believed was the ship, had evidence of coal (fuel at that time) but needed more money to look through the ship to find the gold. As an investor what do you do? In this case, more money was raised and new engineering or do it yourself equipment was built. However, they were fortunate for although they found a ship, was it the right ship? Another pattern showed up and a decision was to go there first to test the new equipment and to try to show the competition they were in the wrong place. The new pattern seemed right and it turned out to be the ship with the gold and those with shares made their money back with handsome returns.

In 1961 President Kennedy said we will have land a man on the moon. For the next 8 years 400,000 people spent nearly $ 100 billion to do that. It was a great accomplishment. In order to get the gold, Tommy Thompson and his team spent $ 12 million, had a group of 30 people successfully searched the bottom of the Atlantic Ocean, perfected their technology, found and imagined a mid-19th century wooded-hulled ship in 8,000 feet of water and recovered her treasures. For Tommy the ship recovery was rally an adventure in thinking, a way of looking at the world. The purpose was to unveil the treasures of the deep ocean, to enhance our understanding of history, to advance marine archaeology to further science or in the words of Star Trek to go where no one has gone before.

Linking to dividend paying stocks, while this was a great adventure, discovering the gold was what motivated the investors. The science, the understanding are a lot easier when there is an economic benefit in relatively easy grasp. We are all motivated by different things which makes us human, having the dividend payments go into the account makes life easier and able to continue to learn new things.

There are more questions than answers, till the next time – to raising questions.

Gary Kinder the author of Ship of Gold in the Deep Blue Sea, Random House, NY, 1998 essentially wrote 3 stories in one  – the first one a description of turn off the century California when gold was discovered. Then the story of the travels between the ports of New York and San Francisco with a stop through the Panama Canal, together with the reports of what the hurricane was similar to. The next story is the person who discovers methods and ways to search for the gold – an amazing creative engineering mine of Tommy Thompson who has to make discoveries to work in the deep oceans. The last chapters are what happens when gold or valuables are discovered. Who do they belong to and who should see them?

There are lots of reasons why investors invest and some of them have similar themes – they like to see what American ingenuity could come up with next, the investors liked the person Tommy. First he was extremely methodical. Second he had a dream, most scientists do not. Third he had way of convincing you without making a great effort. He was living the thing day in and day out. Out of the above there are aspects which are hard to quantify because it is investing in the person.

When Tommy was trying to narrow the field of where to search in the big ocean, he used known field points converted into formula and computed each scenario expecting the 3 known points would line up, the problem was there was an inconsistency or a piece was still missing. In turned out the ships were on the Gulf Stream and it had to be taken into account. When the current was the maps began to overlap and one could see where a starting point was in the deep blue sea.

The deep sea can be a very hostile environment and it costs millions of dollars to be out there so unless there was a reason to be there, people in the community would quickly know. Half the time the reason was government and it was top-secret, the other time was highly proprietary big business venture. Everybody in the deep-ocean community ran around with little secrets and they listened very closely – which meant they could determine what and when you are about to do something. The reason is in the deep blue sea the depth of the ocean presents problems – there are only a limited and rare equipment to go to the bottom of the sea. The deeper you went, the greater the seals on the equipment had to be or the equipment is highly specialized or only a few were involved. This is similar to most industries – it is easy to see once you are in the industry.

In going to sea, Tommy purposely picked mavericks – because he had do the impossible. Mavericks are people who are very good and think outside the box to solve problems, the box is generally liked by large organizations. Tommy used the approach let us talk about all the problems that might arise and then evaluate a couple dozen solutions to each of them. Generally deep ocean clients came with one problem to solve.

Sometimes the best solution was to build your own. Tommy liked to retreat to the point where technology had branched and all thought had taken down the path which lead to conventional wisdom. Tommy liked to go back to the fork in the road and take another look at the landscape. Maybe somebody missed something.

Linking to dividend paying stocks, often times dividend paying stocks are the conventional wisdom, if they are not continuing to view the landscape this is when the landscape changes because something is different than what it was for a long time Part of your job as an investor is to see what is out there and how threatening it is. It is up to the company to have the non conventional thinkers on their radar.

There are more questions than answers, till the next time – to raising questions.

Gary Kinder the author of Ship of Gold in the Deep Blue Sea, Random House, NY, 1998 essentially wrote 3 stories in one  – the first one a description of turn off the century California when gold was discovered. Then the story of the travels between the ports of New York and San Francisco with a stop through the Panama Canal, together with the reports of what the hurricane was similar to. The next story is the person who discovers methods and ways to search for the gold – an amazing creative engineering mine of Tommy Thompson who has to make discoveries to work in the deep oceans. The last chapters are what happens when gold or valuables are discovered. Who do they belong to and who should see them?

With every venture there is a need to raise capital, the easiest method is to raise venture capital from people who regularly fund such start-ups. If you watch the TV show Shark’s Den or something like it, the process is similar – you try to sell your story of why your company has the ability to expand or make higher than expected returns for the investors. The aspect of pitching should be the people who are listening have heard many pitches in the past, they expect to hear more in the future, some investments have only worked out of a tax basis, many do not work out, but still they are listening. Tommy Thompson was connected to Ohio State University through a professor; the professor knew the chief fund-raiser in Columbus who knew people who gave money. They loved the story and the first phase out of three was structured – the Seed Phase; The Search Phase and the Recovery Phase. Those who invested in the seed phase were able to take options into the next phases. Tommy was advised to take the process in the stages as well as not to budget for $100,000 if he needed $200,000. The number one reason why start-up companies fail is they went in underfunded. The first phase the investors are looking to see how disciplined the people are with the money.

There is a wonderful passage in the book considering how Tommy was thinking. Working on the bottom of the deep ocean wan not impossible, it was only considered impossible: other people labeled things impossible not because they could not be done, but because no one was doing them. Tommy had revisited the old assumptions, found many of them no longer valid, and saw ways around the others. The two lead people (Bob and Tommy) saw the process as a series of incredibly nonexistent barriers. Then the process shifted to what can we learn along the way.

Linking to dividend paying stocks, the companies are generating a profit, but others see things the company does not see because the company is making profits. There are alternatives to everything, we see more and more of it everyday, although that does not mean all of us change everyday. In the book, an example is the difference between Columbus and Prince Henry the Navigator. Columbus explored blindly; Prince Henry pursued something that had been never done before. Columbus’ approach was fraught with much risk and he died not realizing what he had done, Prince Henry had heard of gold off West Africa and made the gold the draw but his purpose was to establish a trade route and shipping network – he had his explorers learn about the countries, the winds, the people, in the long run information of greater value.

There are more questions than answers, till the next time – to raising questions.

Gary Kinder the author of Ship of Gold in the Deep Blue Sea, Random House, NY, 1998 essentially wrote 3 stories in one  – the first one a description of turn off the century California when gold was discovered. Then the story of the travels between the ports of New York and San Francisco with a stop through the Panama Canal, together with the reports of what the hurricane was similar to. The next story is the person who discovers methods and ways to search for the gold – an amazing creative engineering mine of Tommy Thompson who has to make discoveries to work in the deep oceans. The last chapters are what happens when gold or valuables are discovered. Who do they belong to and who should see them?

The first part of the story deals with the California gold rush – at a time when people made a few dollars a day, just by dipping a pan into a river could give you thousands of dollars, there was vast numbers of people who went to California to try their luck. It would be similar to buying a lottery ticket, many try only a few succeed but there are stories everywhere. The people went over the rivers and many found something – most not as much as they wanted but they found enough to change their previous lives. The story of the SS Central America was the story of the successful ones and at a time of gold prices at $20 an ounce, when the ship went down; the bars were worth the cost of the trip.

If you look at the ocean, you will see that it is big and even if you know the story well, where would the ship be? The method Tommy Thompson used was to gather as much information as possible – press reports, court hearings, survivors accounts and build a matrix. In addition to the reports, he needed to try to understand the ocean, currents, the terms which people used and build up a knowledge based on the journey. The matrix became known as the Data Correlation Matrix taking up a wall – if you watch Sherlock Holmes TV show – you often see a matrix on the wall.

Linking to dividend paying stocks, there is a numerous methods to gather information and the internet has made it easier. For your investments, you will continue to monitor the industry to ensure you know when to move to alternatives. The first step is to decide on which stocks, then ensure you understand how the companies make a profit; and the next stage is the easier part – the monitoring.

There are more questions than answers, till the next time – to raising questions.