The World Economy
I was watching the late show with David Letterman the other day, and Bill Clinton was on it. They talked about the economy and the problems. Clinton said the problem is that over the last 8 years or so, people have been investing, but only in property, and having a high leverage. The rich people have been getting richer through property, instead of investing in something that creates jobs. It would have been better if it was invested in something like solar energy, and the investors would have made the money back through technology advancements and also creating jobs, and improving the economy.
I think Clinton is quite a good speaker, and he is one of the great leaders, and I believe in this instance he is probably right. I too am trying to make money from money, even though I havn't got a lot of it. Over the last few years, I've been trading on the internet, and trading currencies. It does look like it's again a good time for making money with currencies, and I have made some investments just recently, but now I'm thinking it's time I invest in something that benefits us all, and it may even have better returns.
I would like to invest in something like energy, but I know nothing about it. I'm keen on investing in companies making hybrid vehicles or electric vehicles. I would love to be driving in something that uses 1 litre per 100km of petrol, and not having a high price premium in buying those vehicles. Rumour is, the new Toyota Prius hybrid, due to be launched at the Detroit Auto Show next year, will be better than the current one, using 4 litres per 100km instead of 4.4l/100km. That is an improvement, but I don't think it's attractive enough for most buyers to be willing to pay the price premium. A hybrid car in NZ cost over $10,000 more than an average car. If you compare a Toyota Corolla and Toyota Prius, one uses 7.7l/100km, the other uses 4.4l/100km. The difference is 3.3l/100km. If petrol is $2 per litre, you save $6.6 for every 100km you travel. So if you do 30,000km a year, that's a difference of $1980, and it takes 5 years to make your money back. That doesn't seem too bad.
But consider this. If you buy a Daihatsu Sirion at $15,999, the difference in price is $25,000, and it uses 6.5l/100km. the difference is now 2.1l/100km, or $4.2/100km, and you save $1260 per year, and takes 20 years to make the money back, wow 20 years. You may think you can't really compare the two cars, but for me, I only use my car around town, and most of the time i'm the only person or there's one passenger, and I can take 5 in the Sirion if I want. The choice for me is obvious. Buy the Sirion, invest the extra cash somewhere, and pay a little more for petrol.
Say if I invest $25,000 in hybrid vehicles, and there's a technology breakthrough in 10 years, making the cars do 1l/100km, that would be money well spent, and I'll happily drive a brand new super fuel efficient car at that time.
Another thing I can invest in, is telecommunications. Being an IT person, it makes sense to invest in my own field. Plus, I'm going to be working for Telecom for the next two years, it makes even more sense. I would be keen to see prices drop on mobile charges and broadband, and the only way that's going to happen, is through investment in new technology.
I believe investing in these two areas would be a sound investment, and one that I will see a good return on investment, and in savings in the future.
Someone asked me how do you get out of the recession, I said, make people spend money. We need to pump money in the economy, but not just for personal benefits, but with investments that will benefit everybody.
I think Clinton is quite a good speaker, and he is one of the great leaders, and I believe in this instance he is probably right. I too am trying to make money from money, even though I havn't got a lot of it. Over the last few years, I've been trading on the internet, and trading currencies. It does look like it's again a good time for making money with currencies, and I have made some investments just recently, but now I'm thinking it's time I invest in something that benefits us all, and it may even have better returns.
I would like to invest in something like energy, but I know nothing about it. I'm keen on investing in companies making hybrid vehicles or electric vehicles. I would love to be driving in something that uses 1 litre per 100km of petrol, and not having a high price premium in buying those vehicles. Rumour is, the new Toyota Prius hybrid, due to be launched at the Detroit Auto Show next year, will be better than the current one, using 4 litres per 100km instead of 4.4l/100km. That is an improvement, but I don't think it's attractive enough for most buyers to be willing to pay the price premium. A hybrid car in NZ cost over $10,000 more than an average car. If you compare a Toyota Corolla and Toyota Prius, one uses 7.7l/100km, the other uses 4.4l/100km. The difference is 3.3l/100km. If petrol is $2 per litre, you save $6.6 for every 100km you travel. So if you do 30,000km a year, that's a difference of $1980, and it takes 5 years to make your money back. That doesn't seem too bad.
But consider this. If you buy a Daihatsu Sirion at $15,999, the difference in price is $25,000, and it uses 6.5l/100km. the difference is now 2.1l/100km, or $4.2/100km, and you save $1260 per year, and takes 20 years to make the money back, wow 20 years. You may think you can't really compare the two cars, but for me, I only use my car around town, and most of the time i'm the only person or there's one passenger, and I can take 5 in the Sirion if I want. The choice for me is obvious. Buy the Sirion, invest the extra cash somewhere, and pay a little more for petrol.
Say if I invest $25,000 in hybrid vehicles, and there's a technology breakthrough in 10 years, making the cars do 1l/100km, that would be money well spent, and I'll happily drive a brand new super fuel efficient car at that time.
Another thing I can invest in, is telecommunications. Being an IT person, it makes sense to invest in my own field. Plus, I'm going to be working for Telecom for the next two years, it makes even more sense. I would be keen to see prices drop on mobile charges and broadband, and the only way that's going to happen, is through investment in new technology.
I believe investing in these two areas would be a sound investment, and one that I will see a good return on investment, and in savings in the future.
Someone asked me how do you get out of the recession, I said, make people spend money. We need to pump money in the economy, but not just for personal benefits, but with investments that will benefit everybody.
posted by Frank Wu at
11:35 AM
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