Folks, once someone makes you a financial promise e.g. "invest and earn x% guaranteed" he is selling you a BOND

No matter what its called....cryptocurrency, equity, farm etc, that promise becomes a BOND

(A bond is simply a paper given to you when you lend money to some)
BOND have 4 key characteristics

1. They have a promise to repay, mostly supported by a Sinking Fund

2. They state if they are secured by collateral or if they are naked....

3. They state clearly what the cash being raised is to be used for.

4. They are registered
So when you want to invest ask the Bond issuer..

A. How will you repay? Sinking Fund?
B. Collateral?.
C. Where is the written document that states usage?
D. Where is it registered?
Its simple Ask questions.

Even if it's a private BOND, it must have all 4 minimum.

So if they tell you, "invest in xx and earn 20% per month" ...ask

1. Sinking Fund?
2. Collateral ?
3. Purpose ?
4. Registration ?

That promise or BOND must have all four or you FLEE

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More from @FinPlanKaluAja1

1 Nov
New month....

This month I want to try something new.

This book "richest man in Babylon is the DNA of all investment and personal finance books...I will attempt to serialize a part of it

#FinPlanBooks
Seven Cures for a Lean Purse

1st Cure:  Start Thy Purse to Fattening

Arkad recognizes the great benefit of paying oneself first out of all income.  The recommended amount is not less than 1/10 of all earnings.

Me: When you earn save at least 10%, then invest it.
#FinPlanBooks
2nd Cure :  Control Thy Expenditures

Arkad explains that “what each of us calls ‘necessary expenses’ will always grow to equal our incomes unless we protest to the contrary’.

Me: Live within your means. Spend less

#FinPlanBooks
Read 12 tweets
17 Oct
Looking at the FGN Half Year Budget review....a few things

1. NLNG
Expected Revenue N40b
Actual Revenue N0.00

2.Govt Owned Entp. (Exclude NNPC)
Expected Revenue N495b
Actual Revenue N0.00

3. Recoveries/Fines
Expected Revenue N118b
Actual Revenue N0.00
10 year average for collections

(2010 to 2019)

1. Company Income Tax: N111.49
2. VAT: N69.27
3. Customs: N66.40b
4. Independent Revenue N50.72
Half year 2020

Total FGN share of Crude Oil & Gas
N819B

Total FGN personal cost (MDA only)
N1,426b
Read 5 tweets
4 Oct
In April 2006, Nigeria paid off all her foreign debt.

It was a good deal, Nigeria essentially paid $12b to settle over $30b in debt, in effect an over 50% discount.

Should Nigeria have used $12b to build rails or pay debt?

A very short trend
Borrowing is front loaded consumption.

When Nigeria Borrowed $30b (principal plus interest) she essentially consumed "tomorrow's $30b earnings "today".

To repay, Nigeria has to take current earnings and apply to current obligations.

What are the current earnings? Crude oil
Let's step back, did Nigeria actually borrow $30b?

No

$30b represented principal and accrued intrest..As long as a loan were "open", intrest accrued.

The debt had ballooned not because Nigeria borrowed more but that Nigeria serviced the loan less
..
Read 6 tweets
1 Oct
The usual dose of how Nigeria was once great, what went wrong & what potentials Nigeria has.

Never has so much potential been wasted by so few on behalf of so many than in Nigeria.

Failed State? far from it, but failing in creating an inclusive economy for all.

Happy Birthday Image
The problem is easy to see, low growth and even that "growth" is below the rate of population growth.... Image
Nigeria, largest economy in Africa, with largest number of people living in poverty in Africa. it is that stark. ImageImage
Read 4 tweets
25 Sep
In my days of innocence, I went on a business call with a female colleague to a shop in Shoprite Lagos.

Bored, I did some window shopping, I saw these ladies shoes, all with just the left pair, I picked it up, there was "323" written on a sticker on sole.
I reasoned "was it N32, 300.00? Or left shoe alone

Curious, i asked the shop attention? "How much are these shoes? They look too nice for N32k"

The shop owner looked over at me, in my nice suit and said, "its actually N323,000 a pair"

Three Hundred and Twenty Three Thousand!!
Wait what?

N323,000 how?

My perplexed expression was so innocent, so she explained.

"They are Louboutins..see the red soles.."

I was still not inhaling properly, back then i think Nestlé stock was like N500 a share, I was calculating... Image
Read 4 tweets
24 Sep
Is there anything like a Risk free Investment?

Well what is risk? Risk is the chance you may not achieve your investment objective, in financial lingo its called Volatility of returns .
So "risky" means more volatility of returns, lower risk means lower volatility of returns, higher risk means higher volatility of returns. So higher risk translates to a greater propensity for higher returns NOT a guarantee of higher returns.
Similarly lower risk translates to a lower propensity for volatility NOT a guarantee of zero volatility.
Read 6 tweets

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