[Rhodes22-list] Skinner's Potters - long, historical, full disclosure

[Brad Haslett]

Robert,

Come to think of it, the water in Alaska is quite cold this time of year.  I
think I'll skip the idea.  Her grandfather had two wives and it WAS chaos.
Then I read the attached from Motley Fool and decided to continue going
quietly about my business.

Brad

-----------------------

*Motley Fool
*You Don't Have to Be Einstein to Get Rich
Friday May 18, 9:54 am ET
By Selena Maranjian

Pop quiz! What factors help determine how wealthy you'll become in life? I
initially guessed that education, intelligence, skills, and socioeconomic
origin played a role.

Ohio State economics professor Jay Zagorsky suggests different factors:
"Staying married, not getting divorced, thinking about savings." Wow.

Not only did he not list intelligence, he went on to note that "intelligence
really isn't one of the key driving forces. In fact, people at the middle of
the smarts spectrum have the fewest money problems."

*What's going on?
*When I read about his findings from a study of 7,500 middle-aged Americans,
I was surprised. It seems that the smarter you are, the more you tend to
earn. For each IQ point you have above someone else's IQ, you'll earn
between $200 and $600 more. As an example, he noted that someone with an IQ
of 130 stands to make (on average) about $12,000 more per year than someone
with an IQ of 100.

That's a promising start. We who are smarter than the average bear (I'm
including myself and you) would reasonably assume, then, that smarter people
would end up wealthier. But that was not suggested by the study. Instead,
people with higher IQs and incomes tended to spend more, maxing out credit
cards and paying bills late. At the end of the day, those with lower IQs
often had a greater net worth.

Zagorsky muses that smarter types might justify their spending by assuming
(often correctly) that they can always earn more, if they need to. They
figure they can afford to take risks. He adds, though, that "they're not
smart enough to save a whole lot more of it than the rest of us."

*Saving and investing strategies
*I hope you've picked up on the little secret in this story: It's all about
saving. The people who end up better off take their financial situations
seriously and plan ahead. They think about how to manage their money
effectively, and they save. How do you fare in this department? Do you have
an emergency savings fund? (If not, or if you have no short-term savings,
learn why you should in our Savings Center.)

You need to go further than that, though, to avoid ending up spending your
last years in the rickety and flea-infested Home for Aged Smarty-Pants. You
need to be saving and investing in earnest for your retirement.

*The bottom line
*Here's my favorite Zagorsky conclusion: "Intelligence is not a factor for
explaining wealth. Those with low intelligence should not believe they are
handicapped, and those with high intelligence should not believe they have
an advantage."

The next time you're thinking you're not smart enough to do well at
investing, think again. Think of those Nobel Prize winners who lost a lot
running Long Term Capital Management -- which also cost their creditors,
including *Deutsche Bank* (NYSE: DB <http://finance.yahoo.com/q?s=db&d=t> -
News <http://finance.yahoo.com/q/h?s=db>), *Barclays* (NYSE:
BCS<http://finance.yahoo.com/q?s=bcs&d=t>-
News <http://finance.yahoo.com/q/h?s=bcs>), and *Merrill Lynch* (NYSE:
MER<http://finance.yahoo.com/q?s=mer&d=t>-
News <http://finance.yahoo.com/q/h?s=mer>), hundreds of millions of dollars.
Meanwhile, many simple folks -- bus drivers, teachers, and the like -- are
quietly amassing fortunes by saving and investing.

*Longtime Fool contributor Selena Maranjian doesn't own shares of the
companies mentioned in this article.* For more about Selena, view her bio
and her profile. The Motley Fool is Fools writing for Fools.





On 5/18/07, Robert Skinner <robert at squirrelhaven.com> wrote:
>
> Sorry, Brad, no deal.  You have nothing to offer but
> trouble, with the possible exception of a woman who
> can put up with you, demonstrating fine qualities of
> loyalty and patience.
>
> However, I have read that the Chinese symbol for chaos
> is a house with two women in it.  You might ask Fan
> about that.
>
> Guess you'll just have to muddle along somehow without
> my jewel in the lotus.
>
> /Robert
> Om mani padme hum
> ------------------------------------------------------
> Brad Haslett wrote:
> >
> > Robert,
> >
> > Didn't have time to make it through the first five sentences but here is
> the
> > deal - I'll trade four wives, two boats, an airplane, one construction
> > company with lot's of toys, and, uh, baseball cards, for an Italian
> speaking
> > wife with broken bones.  Deal?  I'm leaving on a cruise to Alaska in two
> > days.  Let me ask Fan if this trade is OK somewhere in route.
> >
> > Brad
> __________________________________________________
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