Breaking Away From the Herd

One of the most fascinating topics of observation and discussion is Human Behavior. More specifically the ability to predict Human Behavior based upon history.

We as people, no matter the race or religion are people - and we are pretty alike. Most of us love the college we attended, we root for the teams our parents rooted for, we dress like the people we hang around with most, and when it comes to money, we generally all move in a HERD.

Consider just the 2 booms:

1. Dot-Com Speculation - everybody has the hottest lead on the next Pets.com or mega-billion opportunity. Invest, Invest, Invest!

Dot-Com Crash. Sell, Sell, Sell! Back to Blue Chips & Real Estate!

2. Real Estate Speculation - When will property ever go down in value? Mortgage Backed Securities are GENIUS! Invest, Invest, Invest!

Mortgage Crisis, sinking Real Estate market... Banks stocks worthless! Sell, Sell, Sell! Horde Cash & buy Gold!

Any argument to the Herd concept is futile. We are humans, and moving in a herd is our nature.

Enter my topic: Breaking Away From the Herd Mentality

It seems to me that this may be one of the hardest things to do... I mean if "The Herd" is BAILING from Real Estate investments... how can investing in Real Estate make you money? The inherent demand for Real Estate in general is greatly diminished because of "The Herd's" lack of interest, right?

Consider the following:

When the Real Estate market was awesome, The Herd felt rich. The Herd began "thinking rich". Collectively, people all over the nation bought bigger houses with riskier loans. We spent more money on cars & travel... bought laptops & flatscreens, etc. We invested like rich people because as a Herd, we were "thinking rich".

What if - YOU had spent that period of time when cash was abundant "thinking broke" instead of "thingking rich" like The Herd at that time? What if instead of believing your home was worth triple what you paid, cashing in your HELOC, and BUYING consumer products like The Herd, you had horded Cash, saved and scraped every penny, and not allowed yourself to "think rich"?

Fast forward to January 2009... The Herd is not thinking so rich anymore! Today, The Herd is "thinking broke". The Herd has spent the last 12 to 18 months pinching pennies, canceling gym memberships, selling cars, refusing to buy consumer products, and trying now - when cash is far less abundant to be financially responsible.

If you had "thought broke" when The Herd was "thinking rich", you could probably afford to think rich today... and truly create some wealth.

This is the essence of breaking away from The Herd. Ask yourself what the Herd is thinking, and move to capitalize on it.

Some Examples:
The Herd - What will we do in this uncertain economy?
The Leader - How will I profit in this uncertain economy?

The Herd - When will this bad economy end so we can live life like before?
The Leader - I hope that I have enough time to take full advantage before the economy recovers!

The Herd - Is afraid that "the Economy" won't get better.
The Leader - Is afraid "the Economy" will get better before I have had the time I need to capitalize on The Herd's thinking.

The Herd - blames "the Economy".
The Leader - takes personal action and doesn't care what everyone else does.

To sum up... RIGHT NOW is the best time in history to make yourself grow as a leader - and resist the temptation to follow the herd.

Right now is the time - if there ever was to take a risk... lead your life, and watch your money grow.