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The Early Point

Tuesday, January 31, 2006

Damn stock market

Okay, so why is it that no matter what I do, I only make like 5% a year on the stock market? Sometimes I hit some, sometimes I don't. It's crazy. I am seriously beginning to believe that the stock market is not the way to go. Why?

  1. Information is not disseminated to people like us before those who can truly profit receive the information. I'm confident of this as I always notice stock volumes rise abnormaly prior to a major release regarding earnings.
  2. Stocks tend to move in small waves. Unless you have A LOT of money in a stock, you may make only a few dollars on a reasonable investment. For example, I may only have $2,000 to invest in a stock. If it goes up by 5%, ive only make $100. Imagine if I had $200,000 invested in that same stock!! You get my point...
  3. Margin is dangerous!! You have the option of paying only 50 cents on the dollar for stocks. The rest is covered by your brokerage institute. However, if the stock goes down, you may get a margin call that you just don't have the cash to support.
It's not that I'm against the market. I've been investing for 15 years. I'm just realizing that with the limited funds that I, and my friends have, the stock market may not be the best way to get ahead....but if not stocks, then what?

What company size is right?

Note: If you haven't read the first post in which i define "The Early Point", then your not ready to read this post. Do not pass not collect $200.

I remember when I was in my last year of university, the professors and career counsellors were very clear about what path they thought we should all take. If possible, we should go into either Investment Banking, Management Consulting, or Accounting. Now, regardless of which of these 3 careers we chose, they were all in agreement that the company we went with should be BIG. Their thought process went as follows- a really big company on your resume is the most important thing to kickstart your career. Without a big name, your career would never be big. The professors and career counsellors never mentioned that there was a whole world of amazing, energetic, young, SMALL company's out there.

In the end, a number of friends and acquaintances went with the small company alternatives and their careers have thrived. Their resumes were not harmed as the professors and career counsellors would have you believe.

Myself, I did what they encouraged, and went with the biggest Accounting/Consulting firm in the world- Arthur Andersen. They were huge!! They also became the notorious company that provided questionable services to Enron, and who folded under the weight of a federal obstruction of justice charge.

What I feel this lesson has taught me is that everyone has opinions about what company size is right for you. I think its up to all of us to ignore the chatter, drown out the noise, and go with the culture that suits our personalities. Luckily, i've realized that given i'm still at the Early Point in my career, my options are still on the table. I just need to make my move...

Wednesday, January 25, 2006

What is the Early Point?

The Early Point is not:
  • Those initial years following the end of an undergraduate university or college program
  • The quest to find that first great job
  • A time when we only have debt to think about, and no savings to speak of
  • Those years where we have become highly specialized in our careers and have abandoned any hope to switch gears
The Early Point is that unique time in our lives where we come to contemplate whether we've picked the right path (usually during the first 5-10 years in the workforce.) It is at this time that we are faced with opportunities to keep on the road we have travelled, or to change directions. It is a time when social beliefs can often clash with economic realities and goals. It is a time where you know you want to invest in your future, but you're not sure how. Maybe you want to start your own business, but the mechanics of it all seem so overwhelming.

In the end, the Early Point is about the most critical time in our lives; The make or break time that most ultimately will determine our future successes. Ironically, this time seems to have been ignored by most publishers and experts. That is why I have started this blog. My goal is not to instruct anyone on what path they should take, or how to get there. Instead, it is a chronicle of my own experiences and thoughts related to all aspects of this monumental time in our lives. Please comment and contribute at will.