 Good day fellow investors. Today we have a situation in the world where 5 to 10% of the people are extremely rich, 40% are well-off and 50% of the population is going nowhere and is extremely poor in relative terms. So we have to see now what is keeping the poor poor and what is making the rich richer. 50 years ago it was simple. The rich could invest in rich investments which made them richer and the poor had to stick to whatever they had a savings account and that's it. However today you can invest alongside everybody else in the world, so you can invest like the rich. So it's not much technicality now, it's about the mindset. So let's see three things that keep the poor poor and make the rich richer. The first thing is rich people are investors, poor people are speculators. If we look at how many people play the lottery you can see that the poorer the people are the more they play the lottery. Rich people don't play the lottery so much. Now further when the poor people win the lottery the likelihood for them to go bankrupt gets higher. So they get more money, more likelihood to get bankrupt. How is that possible? That is because they don't have the right mindset which is an investing mindset. A rich person invests for the yields, the return on investment. So what does it mean to be an investor? Being an investor means investing for the earnings yield. If you invest in the bitcoin which is now the craziest craze of all what is the dividend on it? Zero and that's why that is not an investment it is a speculation. It can be used as a hedge against monetary policies around the world but there are also many questions around that. Now everybody if I go to Facebook to Facebook groups it's everything is about cryptocurrencies. I bet you those who are there on those groups are not rich or if they became rich now thanks to the bitcoin in five years few of them will still be rich. So that's the problem. A rich person looks at a real estate property and then looks at the cash flow from that real estate property that they will get every month. A poorer person looks at the bitcoin and how to speculate similarly to the lottery how to double your money fast and that's the difference. Over 10 years this rich person that is investing in boring investments is enjoying their martinis at the beach while the poor person has lost a lot of money and continues to do whatever they have been doing in the past that goes nowhere so that's one speculation for the poor investing for the rich. Now everybody's talking about the bitcoin cryptocurrencies but here you have something that is not that different. In 2014 everybody was crazy about 3D printing and the 3D printing technology that was supposed to revolutionize the way we manufacture things. You were supposed to print your new shoe in your home and take it and go forward and all the manufacturing everything was supposed to be disrupted. Here I have a chart of the stock 3D printing stock 3D technologies look how it went up 10 times in just one year in 2013. In 2014 it dropped as fast as it went higher because it was all about speculation then it wasn't really an investment. So really be aware to invest if you want to create wealth over the long term not speculate. Rich people invest in such schemes too there are rich people who invested in the bitcoin in 3D printing but they do it usually when nobody else does it and as a portfolio diversification. Rich people invested in the bitcoin two years ago with 1% of their portfolio which is now huge but they didn't risk too much in such schemes so also think about that yes I will invest in that as part of my diversification but with 1% to 5% of the portfolio not risking everything betting everything on one play like many are doing now. The second thing I want to talk about is illiquidity versus liquidity. Everybody is telling you especially if they are poor be sure to invest somewhere where if you need you can get to your money fast because that gives you security. Yes that gives you security you need the money there is a wedding you want to refurbish the house something happens you want to buy a new car you take the money that was invested somewhere and producing dividends you take the money out you buy something after five years you are poorer especially if you buy a car then you have been before and that's why rich people are not afraid to invest in illiquid assets. I had a friend who started an investment fund here in the Netherlands 10 years ago and he had a beautiful network of very very rich people and he went along each one of them for two years to talk about investing in his hedge fund which was a smart hedge fund especially focused for their needs but he couldn't get any investments not because they didn't want to invest in him because they didn't have the cash all that cash of all those rich people was tied up in real estate and they would get the cash every year every month they would get their cash that they would spend for their living expenses enjoying skiing now in the winter in Saint Moritz not so enjoyable now but usually it is or enjoying the nice weather in France during the summer so they would spend the cash flows they would never ever touch that real estate they will never sell it no matter what happens so illiquid is good because if you invest in something illiquid that gives you a return potentially a growing return over the long term like real estate then you can't sell it that easily which prevents you from selling it which allows that investment to build your wealth over time so really think about can I park some money and make it illiquid because then if you need money you will find other ways to get to that money to buy a car or something while your investment will always keep producing returns think about that illiquidity versus liquidity number three rich people think for themselves there is a huge difference between what rich people do and poor people do now everybody is crazy about the sap 500 or cryptocurrencies as poor people look at what happened in the past and then invest if we look at the sap 500 in the last 20 years you can see how we are at the point now that looks exactly like 2000 and 2007 after that we had a huge crash and then okay we had a reversal but nobody guarantees you that there will be a reversal after the next crash just an example of how rich people invest is Carlos Slim he bought 70 percent of the new york times in 2009 and he sold 50 percent of his stake last month while others rushing to buy look at the chart stock price was around four when he was buying in 2009 and now it is above 17 18 when he sold 50 percent of his stake so that's how the rich people do it they invest oppositely to what others do now everybody's rushing in they are selling out similarly Warren Buffett he's sitting now on 100 billion dollars in cash doing nothing so he has so much money he's not investing it because he waits for better opportunities so number three is be patient with your money and really look for great investments you don't have to deploy that money immediately your life is long especially if you are young look for great investments that fit your long-term wealth creation needs so if Buffett with 100 billion and all the connections in the world can't find great investments now make sure to really question every opportunity you have to invest in so to sum up invest don't speculate don't be afraid of illiquidity it might really be helpful especially if you like to spend your wealth and number three think for yourself think about what are your financial goals and what are the best vehicle to get there don't think about what your neighbor is doing your brother-in-law your sister-in-law or anybody else in your circle do what works for you and do it smartly thank you for watching looking forward to your comments how the poor invest and how the rich invest we are here to learn please share your knowledge and I'll see you in the next video