A Short Cut to Making Money Plenty
The Art of Making Money Plenty in every Man’s Pocket, by Doctor Benjamin Franklin hangs in my office. It’s a frequent reminder of the simplicity of building wealth and security in today’s complex world. The full text reads:
At this time when the general complaint is that money is so scarce it must be an act of kindness to instruct the moneyless how they can reinforce their pockets. I will acquaint all with the true secret of money catching, the certain way to fill empty purses and how to keep them always full. Two simple rules well observed will do the business. First, let honesty and hard work be thy constant companions; Second spend one cent less every day than they clearly gains. Then shall thy pockets soon begin to thrive, thy creditors will never insult thee, nor want oppress, nor hunger bite, nor nakedness freeze thee; the whole hemisphere will shine brighter and pleasure spring up in every corner of thy heart. Thereby embrace these rules and be happy.
Short Cut to Making Money Plenty?
So often we want to short cut these very simple principles. In our complex world of credit default swaps, FANG stocks, and seminars on flipping houses, many seek out the services of a financial planner to find the next hot investment scheme that will make them rich with little effort, a tax strategy that will significantly increase their take home pay, or an account that will guarantee high returns with little risk. Another new trend is young retirees making enough money off of a website or blog to afford a life of around the world travel and leisure. Since our society is so connected and we are bombarded with a 24-hour news cycle, it can be easy to see stories like these and feel like you are falling behind or missing out. It may also seem that money can indeed buy happiness.
We hear these concerns from clients. And while we have many more tools available to maximize wealth than the two identified by Dr. Franklin, financial planning at its core always comes back to the elegant simplicity of income minus expenses. The beauty in his words are that they don’t advise on the amount of either. He doesn’t say that you should work as a stock broker, invent an App, or work in a job that makes as much money as possible. He also doesn’t advise giving up your daily coffee habit, never leasing a car, or investing in real estate as many financial pundits do. The advice is timeless and amounts insignificant.
Income Doesn’t Matter As Much As You Think
As financial advisors, we see this simple formula work for or against clients on a regular basis. What is always surprising to me, is that the income part of the equation matters very little. I have worked with people of modest professions like teachers, police officers and nurses who have built significant wealth. They are now in a position to generously support their favorite charities and assist with their grandchildren’s college education. I have also worked with those in higher paying positions who make six figures a year while having little savings and living nearly paycheck to paycheck. These cases are the hardest because they require not only a reality check, but also behavioral changes to build a healthy financial position.
Finding the correct balance to the income and expense equation allows more complex financial planning strategies to be applied to help your money grow efficiently. This maximizes not only return on equity, but return on life as well.
China's Push Toward Excellence Delivers a Global Robotics Investment Opportunity
Written by: Jeremie Capron
China is on a mission to change its reputation from a manufacturer of cheap, mass-produced goods to a world leader in high quality manufacturing. If that surprises you, you’re not the only one.
For decades, China has been synonymous with the word cheap. But times are changing, and much of that change is reliant on the adoption of robotics, automation, and artificial intelligence, or RAAI (pronounced “ray”). For investors, this shift is driving a major opportunity to capture growth and returns rooted in China’s rapidly increasing demand for RAAI technologies.
You may have heard of ‘Made in China 2025,’ the strategy announced in 2015 by the central government aimed at remaking its industrial sector into a global leader in high-technology products and advanced manufacturing techniques. Unlike some public relations announcements, this one is much more than just a marketing tagline. Heavily subsidized by the Chinese government, the program is focused on generating major investments in automated manufacturing processes, also referred to as Industry 4.0 technologies, in an effort to drive a massive transformation across every sector of manufacturing. The program aims to overhaul the infrastructure of China’s manufacturing industry by not only driving down costs, but also—and perhaps most importantly—by improving the quality of everything it manufactures, from textiles to automobiles to electronic components.
Already, China has become what is arguably the most exciting robotics market in the world. The numbers speak for themselves. In 2016 alone, more than 87,000 robots were sold in the country, representing a year-over-year increase of 27%, according to the International Federation of Robotics. Last month’s World Robot Conference 2017 in Beijing brought together nearly 300 artificial intelligence (AI) specialists and representatives of over 150 robotics enterprises, making it one of the world’s largest robotics-focused conference in the world to date. That’s quite a transition for a country that wasn’t even on the map in the area of robotics only a decade ago.
As impressive as that may be, what’s even more exciting for anyone with an eye on the robotics industry is the fact that this growth represents only a tiny fraction of the potential for robotics penetration across China’s manufacturing facilities—and for investors in the companies that are delivering or are poised to deliver on the promise of RAAI-driven manufacturing advancements.
Despite its commitment to leverage the power of robotics, automation and AI to meet its aggressive ‘Made in China 2025’ goals, at the moment China has only 1 robot in place for every 250 manufacturing workers. Compare that to countries like Germany and Japan, where manufacturers utilize an average of one robot for every 30 human workers. Even if China were simply trying to catch up to other countries’ use of robotics, those numbers would signal immense near-term growth. But China is on a mission to do much more than achieve the status quo. The result? According to a recent report by the International Federation of Robotics (IFR), in 2019 as much as 40% of the worldwide market volume of industrial robots could be sold in China alone.
To understand how the country can support such grand growth, just take a look at where and why robotics is being applied today. While the automotive sector has historically been the largest buyer of robots, China’s strategy reaches far and wide to include a wide variety of future-oriented manufacturing processes and industries.
Electronics is a key example. In fact, the electrical and electronics industry surpassed the automotive industry as the top buyer of robotics in 2016, with sales up 75% to almost 30,000 units. Assemblers such as Foxconn rely on thousands of workers to assemble today’s new iPhones. Until recently, the assembly of these highly delicate components required a level of human dexterity that robots simply could not match, as well as human vision to help ensure accuracy and quality. But recent advancements in robotics are changing all that. Industrial robots already have the ability to handle many of the miniature components in today’s smart phones. Very soon, these robots are expected to have the skills to bolster the human workforce, significantly increasing manufacturing capacity. Newer, more dexterous industrial robots are expected to significantly reduce human error during the assembly process of even the most fragile components, including the recently announced OLED (organic light-emitting diode) screens that Samsung and Apple introduced on their latest mobile devices including the iPhone X. Advancements in computer vision are transforming how critical quality checks are performed on these and many other electronic devices. All of these innovations are coming together at just the right time for a country that is striving to create the world’s most advanced manufacturing climate.
Clearly, China’s trajectory in the area of RAAI is in hyper drive. For investors who are seeking a tool to leverage this opportunity in an intelligent and perhaps unexpected way, the ROBO Global Robotics & Automation Index may help. The ROBO Index already offers a vast exposure to China’s potential growth due to the depth and breadth of the robotics and automation supply chain. As China continues to improve its manufacturing processes to meet its 2025 initiative, every supplier across China’s far-reaching supply chains will benefit. Wherever they are located, suppliers of RAAI-related components—reduction gears, sensors, linear motion systems, controllers, and so much more—are bracing for spikes in demand as China pushes to turn its dream into a reality.
Today, around 13% of the revenues generated by the ROBO Global Index members are driven by China’s investments in robotics and automation. Tomorrow? It’s hard to say. But one thing is for certain: China’s commitment to improving the quality and cost-efficiency of its manufacturing facilities is showing no signs of slowing down—and its reliance on robotics, automation, and artificial intelligence is vital to its success.
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