STRIVE to live relatively debt-free. Sharply define what is a need and what is a want. For most things, frugal gurus tell us to buy only when we have the cash for it. Don’t mortgage your future for a mere whim, particularly that which strokes your ego. Debt can have you in a stranglehold. Many have found this out a tad too late.
During these unusual almost post-pandemic days in some parts of the world, money is as tight as the shapewear ads we see on those voluptuous women trying to smooth out those wobbly bits of blubber. And because we are all predisposed to make money quick, (yup, that’s the greed motivation written in our DNA), there will be creative cons and persuasive scams proliferating among all classes of society preying on the masses.
Steer clear of scams from high places, slick talkers or even regular looking, doe-eyed Joes with a business card listing non-existent companies they purportedly own.
TRUST BUT VERIFY ALWAYS before letting go of your hard-earned savings on investments that guarantee results in the future. Be your own personal financial guru if you can. Read up. Ask around. Process the information and decide. Err on the side of caution.
The financial industry makes more than $400 billion on fat intermediation fees, charges or loads or what people like me, simply call being the middleman. Guess where that money is coming from? It’s all perfectly legal and protected by fine print disclosures.
Yup, it comes from you and me and millions of others. So when you invest in any instrument, whether stocks, bonds or mutual funds, domestic or international, look closely at how much you have to pay to stay invested. Your net earnings are what matters in investments over the long term.
If you must invest, PROCEED WITH CAUTION. Every investment involves a level of risk that affects your personal financial wellbeing. Life holds no guarantees. The same is true of investments.
Investing is different from speculating and gambling. In investing, you do your homework with the complete awareness that you will be there for the long haul, that is, if your situation permits it.
Time can be your friend so start early and take conservative, calculated risks. Put your nose to the grindstone and do your homework. Don’t rely on hearsay.
You will hear of glowing stories of such and such a person becoming rich overnight in bitcoin or cryptocurrency or some investment that guarantees to return $100,000.00 on your $10,000.00 investment in a short period of time.
Rarely will you hear of stories of the many souls in the last 200 years who plunked down their money and promptly lost their shirts in investment cons while their perpetrators slithered away in the dead of night, went under the radar, never to be seen again.
Some painful lessons in life can be avoided by doing your due diligence in digging deep into the fundamentals of a proposed investment and the principals pushing such investments. TRUST BUT VERIFY.
You have to be skeptical. Shoot straight questions and expect straight answers. Then dig deep. Where are hose investment returns coming from? Are these returns coming from dividend earnings of solid companies that have been in business for a long time? Beware of the hype and the hysterical bandwagon mentality that fueled scams such as the tulip investment craze in the last century where many investors worldwide, got burned, lost their shirts and ended in the poorhouse.
Bernard Madoff, the biggest Ponzi convicted scammer doing time in jail, had a Wall Street address and a highflying lifestyle to flash around. He had a steady gaze and an air and demeanor of respectability and trustworthiness about him belying a heart of darkness.
But greed went both ways. Madoff’s victims did not question why they were getting consistently great returns on their investments for as long as their phony statements were rosy year after year for decades.
Then the financial bomb exploded when the US and the global economy ground nearly to a halt more than a decade ago and no new investors can be suckered in by the monumental Ponzi scheme Madoff and his cohorts hatched. Built on a big fat lie, it collapsed like a house of cards.
What a monstrous mess it was. The nursery rhyme was prophetic of Madoff’s scam.
“Humpty Dumpty had a great fall. All the king’s horses and all the king’s men couldn’t put Humpty together again.” The tedious efforts at clawing back some of the money spent on a shamelessly luxurious lifestyle was as grueling as pulling teeth from a Tyrannosaurus Rex.
One of Madoff’s sons, unable to bear the shame and ignominy sadly hung himself with a dog’s leash in his Manhattan apartment leaving behind a wife and children who would like to escape the stigma of the Madoff name. The other son died of an illness. His wife now bears the brunt of his crime. Madoff’s sentence is 150 years behind the slammer.
Considering the distress and sorrow he has brought others, a thousand years would probably still be inadequate.
And yet, even with the cautionary tales that litter the past that should put the fear of being taken for a ride firmly in our hearts, it seems the prospect of big gains over short periods of time has a stronger pull on us.
Call it by any other name. That is not investing. That is plain and simple gambling. Casinos know this. Only a pandemic that demanded social distancing placed a temporary pause on the casino industry’s decades-long winning streak.
Was there something from the Bible to caution us about this? The one that comes to mind intended for scammers like Madoff and his ilk, is of course, “Thou shalt not steal.” Or maybe in this case, “Thou shalt not con.”
Scams are no more than sophisticated thefts generated these days from the comfort of one’s computer in the guise of legitimate sounding paper and lately, quite easily, electronic communication.
This is the modern version of a hooded, masked robber using a gun in a dark alley. Now we have keystrokes. New laws on tracking and enforcement procedures are decades away from dealing with this worrisome social phenomenon that seems able to breach all kinds of barriers.
The antidote: continuous education, a smidgen (nope, make that a mountain) of skepticism and a ton of good old common sense.
What’s the mantra worth remembering and repeating to one’s self particularly during these days of tight money squeeze on a global scale when scammers are getting more creative and brazen?
Of course, it’s still that one that says: “If it’s too good to be true, it probably is.” Well this one isn’t in the Bible but it might very well be.
In a word, “THINK.”
* * *
The opinions, beliefs and viewpoints expressed by the author do not necessarily reflect the opinions, beliefs and viewpoints of the Asian Journal, its management, editorial board and staff.
* * *
Nota Bene: Monette Adeva Maglaya is SVP of Asian Journal Publications, Inc. To send comments, e-mail monette.maglaya@asianjournalinc.
