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NJmike PE

Inspirational Quotes

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If you can't win fair, win by cheatin', but if you're gonna cheat, win!

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Could one live off trading in the Stock Market?

From my personal experience, unless one owns millions of shares like the Buffetts or other stocks investors, it is difficult to make money off of trading in the Stock Market. The IRS wants its share, and one has to pay capital gains and other related fees when one sells its shares of stocks. In my mind, how did Warren Buffett in his early twenties live off of trading in the stock market alone???

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Business Principles from the Sage of Omaha

1. Do not let anyone else run your business, unless 

  • you can supervise his performance with adequate care and comprehension or;
  • you have unusually strong reasons for placing implicit confidence in his/her integrity and ability

2. Do not enter upon an operation or business ventures, unless

  • a reliable calculation shows that it has a fair chance to yield a reasonable profit (keep away from ventures in which you have little to gain and much to lose)

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“I am a very stable genius and ready to put up a fight at anytime.”-D.J. Trump

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“Close all the doors and be alone in the room and think. If that doesn’t work, you should be fearful when others are greedy; and be greedy when others are fearful.” - The Sage of Omaha

 

 

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“Only when the tide goes out you discover who’s been swimming nekked.” The sage of Omaha

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At the beginning, right out of engineering school, one expects to have high salary based on national statistics. And at some point, one realizes that if it's too good to be true, it probably is. As my Grandfather once said to me, "Son, stop day dreaming. Just get your foot in the door and survive." 

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Do not listen to Warren Buffett when studying for the FE or PE exam

Buffett says to read financial reports or annual reports or financial books, but don't do equations with Greek letters in them.

When you are reading or studying for the FE or PE exam, write the equations with applicable Greek letters in them. 

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“A University of Chicago graduate student asked me once, what are we being taught that is wrong? In business school the amount of time spent teaching option pricing is total nonsense. 

You only need two courses: 

1) how to value a business

2) how to think about market fluctuations.

The thing is that the instructors know the formulas and you don’t, so they have something to fill the time. It has nothing to do with investment success-what matters is buying businesses at the right price. If you were teaching Biblical Studies and you could read the Bible forward, backward, and in four different languages, you would find it hard to tell everyone that it comes down to the Ten Commandments. The Priests want to spend a lot of time preaching. You must have an attitude where you aren’t influenced by the market.” 

-The Sage of Omaha

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Today, we started off our first meeting inside a modest restaurant. Across my table, were two attractive females and another attractive female was sitting next to me, so we were sitting side by side. The lady that was next to me proceeded to shake my hand and said to me, “we’re glad to finally meet you Dean, and am in charge of the board minutes.” They handed out their business cards to me and when I read them, ‘Lady 1: Attorney at law, Lady 2: Attorney at law, Lady 3: Attorney at law.’

In my mind I was like “man!” What am I getting myself into again, Lol!

But overall, the meeting went well and 4 important steps I learned when transaction is a bit complex:

(1)Face to face meeting (minimum of 3 meetings)

(2)Memorandum of understanding

(3)Binding Contract

(4)Execution

(5) Bonus: you get sued if you don’t perform well 😇

 

 

 

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Some of the game players profiles include: Finance (London School of of Economics), Founders of investment fund Singapore, Finance executives, (Phd)Taipei Group, another one from China (Founder and chairman of Publicly traded Company), Another one Publicly Traded company From Canada (Mergers and acquisition)

I was like Hunny! We’ll be beaten out again :D

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The Beginning-Incorporation

1) Company Structure: LLC, Corporation, Sole Propretorship

2) How many Authorized Shares in the Articles of Incorporation?

3) Common Stock Shares and par value of each share

4) How much stock issuance  to the initial founders? How much option pool of stock? How much stock for investors/shareholders and par value of each share?

5) Distribution of Profit?

6) Operation Agreement?

7) Indemnification of Board of Directors from Operation guys (COO and its subordinates)

8) Indemnity Agreement 

9) How to handle lost of founder/cofounders/board of director

10) Investors agreement? 

11) Think win-win situation 

12) Salary? Overhead costs?

13) How to handle lawsuit? Legal fees? Any lawsuit that may arise from competitors, how do you want to handle it? Fight, flight or Settle?

14) 

(*)  ***Centralized Financial decision (Capital Allocation) 

(**) Right of First Refusal Provision 

......

 

 

Edited by Dean Agnostic

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At one point in my life, I was so broke; but I was still able to survive eating that $0.99 cheeseburger and went on a couple business dates in such a romantic restaurant :thumbs:.

IMG_0122.jpg

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Never give up on taking the FE or PE exams

"Today is hard,

Tomorrow will  be "WorsE"

but the day after tomorrow will be beautiful! "

-Jack Ma

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:holyness:Indemnification The Corporation does indemnify any directors, officers, employees, incorporators, and shareholders of the corporation from any liability regarding the corporation and the business of the corporation, unless the person fraudulently and intentionally violated the law and/or maliciously conducted acts to damage and/or defraud the corporation, or as otherwise provided under applicable state corporate statue.

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If you are going to solicit investors money, think of this provision carefully and Good luck! 

ARTICLE 1: Authorized Capital Stock and Pool Stock Options

1.1 That the authorized capital stock of the corporation is ____________________________________, in lawful money ___(country and/or state)__________, and the said capital stock shall be divided into _____________________________________ with the par value of _______________________________.

1.2 The corporation will set aside for grant a pool of stock options to purchase ______________________________________ out of the ____________________________________________ authorized shares as stated in Article X subject to the Board of Directors and/or incorporators’ approval with terms and conditions for new shareholders

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Compounding

"Such fanciful geometric progression illustrate the value of either living a long time, or compounding your money at a decent rate. I have nothing particularly helpful to say on the former point." - Warren Buffett

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"Give a man a fish and you feed him for a day. Teach him how to arbitrage and you feed him forever." - Warren Buffett

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(3% to 6%+ savings) Maybe you're the buyer or the seller and you know the buyer/seller directly, consider this provision on your contract 

Exclusive Negotiations. The seller and Buyer shall proceed to negotiate with each other in good faith and that no broker, agent or other intermediary has been involved in negotiating this sale.

 

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