Many will say that real estate is the best investment. I disagree. Let’s start with supply and demand. The price of any resource is determined by the relation of supply to demand. In other words: How much is there and how many people want it? Price is a direct function of how many people want it (demand) versus how much of it there is (supply). If more people want it, but there is less of it, the price is higher. If there is more of it than people want, the price is lower.
Understanding supply and demand makes the world much easier to understand. If you’re a little foggy on supply and demand, read more on the Wikipedia page for supply and demand.
Here’s why real estate is so awesome as an investment:
1) Certain Demand: People are always going to want to own land. Whether it is to live, put a business or to store their antique car collection, as long as there are humans, they will want to claim a piece of land for themselves.
2) Fixed Supply: There are only so many usable square feet on this planet, so there is a fixed supply. You can’t print, manufacture, build or otherwise create any more land on this earth than there already is.
No question, real estate is timeless as an investment. But I’ve got something better.
A Platform is just when people listen to what you say, like listen to your show, read your blog, read your magazine, follow you on social media, etc. It’s when you have their attention.
“The most precious commodity that we have is attention.” – Arianna Huffington
Here’s why attention is better than real estate:
1) Certain Demand: As long as there are people who want to communicate, for the purpose of selling something, fundraising, or any type of communication, there will be demand for attention.
2) Fixed Supply: The supply is limited by the number of humans and the number of hours in a day. There is no more attention. Humans sleep 8 hours a night, so there are 16 hours remaining in each day that we can potentially have their attention.
As long as someone wants to communicate, they’ll need attention.
The Internet has changed many things, most notably, the number of people who are trying to get attention. It has lowered the barriers to creating communication drastically. Right now, anyone can take a message, and make it available to everyone with access to the Internet. As of June 30th, 2012, and according to http://www.internetworldstats.com, that’s 2,405,518,376 people.
There is a massive number of people assaulting us with their information every single day from roughly the same number of people. This has made attention much harder to get, much more scarce, and therefore much more valuable.
Google CEO Eric Schmidt recently said, “we create as much information in two days now as we did from the dawn of man through 2003″.
Every two days, we create as much information as we did from the dawn of man to 2003. Information is no longer an asset. It’s a massive distraction. The asset is a group of people who listen when you talk, who’s attention you have — your platform.
The key here is that all this information is only potentially available to those people. An overwhelming majority of them will never notice what you just put out onto that blog post, social media post, or website. But if there is a group of people who are interested in what you are saying because they have heard your stuff before and they know that what you say is going to be interesting and valuable, they’ll pay attention to YOU and tune out all the other stuff.
Build platforms, build wealth, build life.
Image Attribution: Audience – Stallman’s pre-Wikimania 2009 talk – Wikimania 2009.jpg|Audience – Stallman’s pre-Wikimania 2009 talk – Wikimania 2009