《lesson 2--2016--introduction》.pptVIP

* * * * * * * * * * * * * * * * * * * * * * * Who is he? Warren Buffett Born August 30, 1930 (age?80) Omaha, Nebraska, USA Net?worth US$52.4 billion (2007) US$62 billion (2008) US$47 billion (2009) In 2007, Buffett was listed among Time Magazines 100 Most Influential People in The World. * Expensive lunch Buffett’s lunch sells for record USD650,100 in 2007. Last years winner, Yongping Duan, bid $620,100 to dine with Buffett USD2,110,000 with Zhao Dan Yang in 2008 * It is not that I want money. It is the fun of making money and watching it grow. Question Is Warren Buffett your investing role model? Reasons To avoid money devaluation * Reasons To shift your purchasing power from high-earnings period to low-earning period of life. Asset classification Real assets versus financial assets Real assets-assets used to produce goods and services- -the land, buildings, machines and knowledge that can be used to produce goods and service. * Real asset cont’d The material wealth of a society is ultimately determined by the productive capacity of its economy, that is the goods and services its member can create * Principles of Economics A Country’s Standard of living Depends on its Ability to Produce Goods and Services. Financial assets Financial assets—claims on real assets or the income generated by them, such as stocks and bonds. Individuals can choose between consuming their wealth today or investing for the future. If they choose to invest, they may place their wealth in financial assets by purchasing various securities. * Financial assets cont’d Such securities are no more than sheets of paper or, more likely, computer entries as do not contribute directly to the productive capacity of the economy. Instead, these assets are the means by which individuals in well-developed economies hold their claims or real assets * Questions 1. Are the following assets real or financial? A. Patents B. Lease ob