The Other Side

I've been mixing with investment and legal types a lot lately. I'll let you presume why as I am not at liberty to really blog about it.

I was raised in a working class family. We always had plenty and my parents have actually done quite well for themselves and have provided me and my sisters with excellent educations. So, although, I had everything I needed, money wasn't something that was ever thrown around.

My parents actually do very well now and I certainly make more money than your average 27 year old. But, I am certainly not at the point where I am throwing it around.

A friend of mine, who reads a lot about creating wealth, told me there are a few steps to getting there. Or there is usually a path that people take to get there.

- The first part of the path is the one that most people are doing (and do until they retire) is: Working for Money or a J.O.B.
- The second is Working For Yourself. What you Put in Is what you get out. This is assuming you can figure out how to get money from your work from customer(s).
- The third is building a business where other people are working for you. You are still working, but it is more of a strategic and guidance role. Your main task is controlling the $ and managing the resources. In effect, you are managing cash flow and taking some of that for yourself.
- The fourth and final step is Managing Investments. You place bets on who can make you more money. It could be by buying a bar or a laundromat, investing in an internet business or playing the market. This is what I call the 'Other Side'.

You can see that you would have more control over your own wealth generation in these successive steps.

And when you are at the final stage and flush with money that you can't really spend it all by buying 'stuff', like normal people can, everyone wants to be your friend and everyone wants to use your money to 1) help you make more money and 2) make themselves some.

It is an interesting game. I'll spare everyone my thoughts on the morality of all of this. And I am definitely playing the game. So, I wouldn't want to be too hypocritical. Nonetheless, I am not sure I will achieve 'happiness' for myself if I get to that fourth and final step and don't do something for society in the process and/or something for society when I get there.

The fourth step is what I see as Wall Street's main profit source. Taking money from the people who have reached the fourth stage and figuring out how to make more money with it. They've obviously been doing it with varying amounts (but net net) success for a long time now. The system works.

That isn't to say, however, that the system is perfect. All of this background is just to put in context, the amount of appreciation I have for the choice that google has made to go public using an auction. If you want to make sense of this post and my last statement, read this post by Seth Goldstein on Google vs Wall Street. You will be amazed at how Wall Street's old boys club makes money from IPO's And how google is screwing up the party. (And we're not just talking about the kind of parties that us average people go to with a keg of beer, plastic cups and bbq.) (found via John Battelle.)