A common theme in my mind lately has been how we look at the choices we make. As one would imagine, Kristen and I are making tons of decisions right now. And we’ve come to this conclusion: Most decisions are morally neutral and the outcome depends on you.
Quick disclaimer: Look, I know that there are moral decisions. Things which God has said are black and white. For example: “Should we cheat on our taxes? ” No, God’s pretty clear on that one. This is more about decisions such as, “Should we rent house A or house B?” I think those decisions are typically amoral.
Positive outcomes and positive attitudes
When it comes to amoral decisions I’ve noticed that the outcome is largely dependent on my response, action, and attitude. In other words, when I make a decision, whether it turns out good or bad typically has to do with what I do with that decision.
Here’s a reality my friends in Michigan have to deal with. There is a thick black cloud of pessimism that permeates our community. Until that pessimism is overcome with optimism, the self-fulfilling prophesy of economic doom and gloom will continue. It’s oppressive. It’s depressing. And it is making things worse.
Perhaps it is because I am moving, but almost every conversation I have goes like this, “Romeo is a great place to live… but I don’t know, things aren’t looking good.” Understand this… that is a value statement of risk vs. opportunity.
And it’s not all over. As I’ve traveled this summer I think you should know that this deep pessimism is a Michigan thing. Board a plane departing or arriving at Metro or Flint and it’s all pessimism in the cabin. But walk through Atlanta, Denver, or San Diego’s airports and you’ll see people making lemonade with their lemons. Head back home and it is all about rotten lemons. Making lemonade is apparently too risk for Michigan’s lemon owners.
Today in Romeo there are about 100 homes on the market. All of them, including mine, are listed below market value. If you’re living with the black cloud… you look at the housing market and say “Wow, it could go even lower. Owning a home is such a huge risk right now.” If you look at the housing market from an optimist perspective you respond by saying, “Man, what a great time to buy. I wonder how I can get some capital to buy up some rental properties.”
Here’s the simple reality. Michigan may be in a tough economic situation. But if you see where we are today as pre-boom instead of post-bust you’ll recognize that tomorrow’s millionaires (billionaires?) see today as an opportunity and are leveraging against you over inflating the risk. The rich of 2015 see this as pre-boom. The poor of 2015 see this as post-bust. Get it? It’s all about your response.
I’ve talked to tons of very young adult people 19-22 years old this summer. And the cloud has infected them with pessimism. They have no dreams. And they are not looking at today’s problems as their opportunity for a very bright future.
Here are some opportunities
#1 You could innovate the next economy for a community. It won’t be cars, but will it be technology? Probably. Yet starting a business is “too risky” or going to study what is going on in tech boom towns like Boise, Houston, or even Ann Arbor is simply too much risk. Trust me… the best technological developments come from people looking to make an opportunity out of nothing. (Speaking from experience!) R&D departments can’t build a winner. But a college kid can invent Facebook for a couple hundred bucks. And a laid off carpenter can invent an ipod repair business. Sit in a room with a legal pad for a day and no distractions and I guarantee you can innovate something.
#2 You could be the next real estate tycoon for almost no risk. If you are 22 years old with a college degree and an entry level job. You could buy 2 homes for less than $1500/month. Live in one and rent the other. In 3 months buy another rental and keep capitalizing on people’s pessimism until you have 5-6 rental homes. As Romeo becomes a renters market you could gain both equity in these undervalued rentals and make tons of income from rent. Heck, if you are 19 with a part time job you could buy a house for $600/month and rent it for $800/month. Save those profits and do it again in 6 months. Hold/rent those 5-6 properties for 10 years and you just made a million dollars.
#3 You could invest in the next Microsoft or Apple. My conversations with those bought out from their autoworker jobs are depressing. They are saying “How long can I last on this money?” Wrong question. The right question is, “How can I find the right start-up to invest in?” Michigan has a highly educated and undermotivated work force. As soon as that motivation part turns around this economy will come back like gangbusters. Are you investing in high return start-ups or are you still thinking large cap companies are going to return? Bill Gates’ earliest investors tossed in only $10,000. I think they did OK.
Every decision I make is an evaluation of risk vs. opportunity. What about you?