Recession Economics 101

Alberta is one of the few places you can go from the bottom to the top.

Arrival

Before arrival in 2006  I examined the austere government under Ralph Klein and I decided this is where I will engineer my place towards the top of Alberta’s trickle: oil and gas.  Over the years, I have watched fiscal policy tilt left each year, and when the oil crash happened –  human nature dictates self-preservation.  The only way politicians are elected is if they pander to the majority.
Lesson in that.

Don’t be at the end of of the trickle

Not everyone can be a producer or service producers. It is easier to be a net consumer – but this does nothing to improve our real-world production. On a micro level, my business produces units of processed accounting. Whatever I spend that does not directly allow me to produce more, is consumption.  Similarly, on a macro level real tangible production that grows the economy is producing something that others want – for Alberta it has been oil, for Switzerland: pharmaceuticals, watches etc. Ultimately, everything else only exists because SOMEONE somewhere is producing something.  While consumption in Alberta continues to overtake production, we will continue this downward spiral.  Increases in government spending which our governments borrows from future generations keeps the majority from the pain of living beyond their means – the piper will be paid.  The more government interferes the longer the inevitable outcome will be. For most, it will get worst before it gets better.  Lesson: don’t rely on things you can not control.

The recovery

By sacrificing productivity for a period of time, time and resources  can be invested.  Innovation exponential increases my end productivity.  This is only possible by under-consumption. By under-consuming one can still feed themselves while they are not directly producing. Here is how the government does the opposite: Artificially low-interest rates make the housing market seem stable (fake accomplishment) – keeping overpriced houses seem affordable.  Over consumption of buying more than what you need, will keep you from being able to invest your precious time/resources (now being consumed to service bigger mortgage, lifestyle, etc.) from opening your own business.  The only way real economic improvement will happen is if this happens on a macroeconomic level.  It is a mistake to think that logic changes from simple household economics.

Which one are you?

  1. Pessimist = Complain about no jobs.
  2. Optimist = Hope the job market improves.
  3. Winner = Creates jobs – or at least one for yourself – follow framework below and throughout blog.

Fun facts

  • Alberta is a monster economy and even during a recession Alberta’s per capita GDP exceeds $80K – on par with Switzerland’s and nearly DOUBLE the rest of Canada and Europe. It takes a million more Norwegians to generate the same money as Albertans.
  • If you live in Edmonton there is money everywhere. PCL Construction generated record revenues of $8.5 billion in 2015 and is on track to reach $9 billion this year.
  • The Swiss have a wealth-based taxation system that is easier on the average worker. While the Alberta system is supposed to be progressive – up to 48% for the highest bracket, business owners can escape these taxes with strategic planning. For example, in 2016, a well executed strategy would have someone pay $16,000 in taxes net of Canada Child Benefits on a $260,000 income, or a tax rate of 6%.  This is a 10% less than what a single income family with 2 children would have to pay on a $50,000 wage.
  • Prior to 2015- 90% of my income came from oilfield.
  • I proudly can say I have never had to axe any employees in this recession and I have rejected all the requests to outsource bookkeeping to India. In my tradition of doing the opposite, I continue to give raises and bonuses.
  • Most people have no political pull so speaking of politics this far from election does nothing.
  • No government can save you. The only way to improve your life is the harder task of honing your skills.
  • Understand that big government will always have inefficiencies, no big deal, business as usual.  Smart ones are taking the money and laughing.

Recommended Framework

  1. Develop and exercise your rare and valuable skills.
  2. When you are ready “productify” your service. Don’t charge per hour, make clear-cut product offerings or sell something you know better than most.
  3. Sell either business to business or online or both. If you sell direct to consumers, remember who spends the money *hint: it’s not necessarily the people who earn it.
  4. Ritualize everything to focus on what’s important
  5. Prioritize efficiency = value created/time spent creating value
  6. Get the right people on board and the wrong ones out.
  7. Hire 2, work them like 4 and pay them like 3.
  8. Don’t try to please everyone. Most people are not worth it. I lose bad customers and obtain good ones. To be polarizing is a good problem to have.
  9. Buy fixer-uppers if you can realistically expect to double or triple your investment (do not count on capital appreciation if you are borrowing money!)

Pour Conclure

Control what you can control and ignore the rest. Manipulate the system to suit your needs. Our new government wants to spend billions on infrastructure, so get your self a piece of the pie, and employ our services so will let you hold on to as much of your hard-earned money as possible.  The smaller percentage of taxes we pay is still our wonderful contribution to a great place I am proud to call home!

The triangle gets smaller on the way up so sooner or later we will meet!

You will receive a gift card equal to 1 month of service of your referral. Up to to $600 for every successful sign up through your share or like. Save a business taxes today.
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http://www.christianthut.com/

As a result of improved efficiency – made possible by savings, innovation and investment – our prices are down and the benefits of THUT are available to a wider pool of entrepreneurs.

What was once a luxury for Edmonton’s elite is now available to all. Quality, reliability, and precision: THUT is a reflection of 21st-century Switzerland. Like all things Swiss, our customers rely on us in the long-term. Generations ago we decided that it would be easier to explain price one time than it would be to apologize for mistakes forever.Our offerings are worth what it can do for you and not what you have to pay for it. It is better to pay a little more than you expected than less than you should when dealing with something as serious as taxes. Another Edmonton accountant could cost you millions of dollars more.

Motivation does NOT work

Why do I still do accounting?
I still do accounting because I want to master a scalable craft that no longer feels like work to me.  The anticipation of improving a little each day keeps me at my desk. Working for stuff, is not the way to go through life- cars and tech get old and outdated.  No one can take my skills from me. Money is only a byproduct of being skilled at a craft vs. competitors that are so focused on making money that their short-term actions are destroying their long-term goals.
North American style big goals of having a big house + big vehicle can put you in debt or at least limit your freedom.  Once you have your essential costs covered for life (housing, food and clothing) then by all means splurge on whatever you choose.  There is nothing wrong with nice things, but you will be a happier person being happy with what you already have and you won’t have to postpone or give up what you seek most for a momentary fix.

My Core System:

  1. Prioritize sleep.
  2. Improve my work each day. I keep a tally of my hours in focused work each week
  3. Improve my body each day. I keep a daily journal of the weight I lift, the number of reps and sets I do, also what I juiced/blended/ate that day

Environmental System to Facilitate my Core System

  1. I do not own a mobile phone or have wifi
  2. I only purchase healthy groceries
  3. I have never bought a TV, and there is only 1 projector in my theater which my kids use maximum once per month. TV & escapism = waste of life. Make your own life great instead

As you can see, my systems do not require any start-up cost. In fact, my system costs less than the typical persons life. I spend nothing on escapism, TV, entertainment, and unhealthy food.

Share with someone that could use some advice in this post or save some taxes
For every person you refer we’ll give you a free month or a gift card equal to 1 month of service of your referral – whatever is bigger! Up to to $600!
Anyone you refer gets a free month of bookkeeping!
THUT data capture technology extracts data from bank, credit card and online statements and allows for automatic bank reconciliation.
SwissBooks uses artificial intelligence to locate and extract line item and tax summary data from receipts and exports it into a csv file.
Cleansing algorithms allow it to extracts transactional data that is 100% accurate.
Send us your prior financials and we will prove to you how our value is unrivaled in Canada.
➤➤➤

 

Recommended Products

 

ATTENTION: THIS POST WILL NOT BE UPDATED ANYMORE. PLEASE VISIT HERE FOR THE MOST RECENTLY UPDATED APPROVED PRODUCTS




Purchases that we really recommend listed in 3 different categories with reviews of the product item is listed after the product name (if applicable):

Disclosure: this post contains affiliate links. 

  1. Health products
  2. Household products
  3. Children’s products
  4. Book recommendations can be found here

Health products:

  1. Organic Apple Cider Vinegar  (natural, organic cleaner used to clean the house & toys)
  2. Nutiva Organic Virgin Coconut Oil (natural, organic moisturizer/body butter/cooking oil – recipes listed below)
  3. Everything Natural Grade A Organic Shea Butter (natural, organic moisturizer/body butter/cooking oil – recipes listed below)
  4. Omega Vertical Slow Masticating Juicer  – We use this VRT350 Heavy Duty Dual-Stage Vertical Single Auger Juicer for our juice daily. The kids love carrot/spinach/kale juice! More about our new juicing journey here
  5. Webber Naturals Ocean Pure Omega-3 liquid fish oil  in Niklaus’ favorite Lemon Cake & Anja’s favorite Grape Fruit  – We take 1 teaspoon each per day and there are 40 servings in each bottle. Learn more about why you should stop taking fish oil capsules and start taking liquid fish oil instead here.
  6. Yogotherm Probiotic Yogurt Maker  Why buy  probiotic yogurt that has a long list of ingredients and added sugar that has been sitting inside a plastic (harmful!) container for who knows how long, when you can make your own with 2 ingredients: organic milk and the probiotic culture!

Household products:

  1. Dr. Bronners Liquid Castile Soap in Organic Baby Mild, Organic Lavender, Organic Peppermint, Organic Citrus (natural, organic hand soap/face wash/body wash -recipes listed below)
  2. 100% Organic Canadian Certified Buckwheat Pillow by eco&eco (17″ x 23″) – we absolutely love these pillows! 100% organic cotton GOTS, natural, not bleached, french terry pillows filled with 3.5kg(!) of organic buckwheat hulls. (Review)

Children’s products:



More about our new healthy, homemade:

  • toothpaste here
  • coconut face/body butter here
  • coconut & shea butter face/body butter here
  • kid-friendly hand soap/face wash/body wash here
  • face scrub/wash here


Share with someone that could use some advice in this post or save some taxes
For every person you refer we’ll give you a free month or a gift card equal to 1 month of service of your referral – whatever is bigger! Up to to $600!
Anyone you refer gets a free month of bookkeeping!
THUT data capture technology extracts data from bank, credit card and online statements and allows for automatic bank reconciliation.
THUT uses artificial intelligence to locate and extract line item and tax summary data from receipts and exports it into a csv file.
Cleansing algorithms allow it to extracts transactional data that is 100% accurate.
Send us your prior financials and we will prove to you how our value is unrivaled in Canada.
➤➤➤

Are Your Short-Term Actions Destroying Your Long-Term Goals?

Please don’t focus on short-term gains at the expense of long-term gains.

 Lesson 1: Honesty. A decade of honesty will give you 300+ customers that would trust you with their life’s work and spread the word as far as they can.  The dishonest are always in self-denial. Life is fair in the developed world and the more you add: the more you get.

Lesson 2: Operate on 5 year plans. Think of what the implications of your action today are 5 years from now.  We focus on doing the right thing each day and not about profiting from our employees and taking money from our customers.  We give our customers more value than what we charge, and they have become raving fans for life who allowed us to process over a billion dollars in bookkeeping! Each year we improve at our skills because we get better as we generate value over a longer duration.

Lesson 3:  Cut the dead weight.  Ruthlessly protect your time. Mentoring to qualified people can be rewarding like parenting.  Do not waste time and energy with those who do not make progress.

Lesson 4: In line with our contrarian approach: Always judge a book by its cover!  Anyone who says different has a terrible cover!  Poor choices reflect poor character. Avoid these people at all costs. They will simply slow you down.

Background:

The tone of the blog for the first quarter of 2016 got a bit harsh,  but it had to said to remind everyone that people with no value should be avoided at all costs.  From the outside looking, you only see the success and people assume we make the hard look easy.  We go through tough times just like anyone else.  Evil is everywhere and its up to you to learn from your mistakes to insulate yourself from people who waste your time.

You’ll be happy to know the future is upbeat! 

I decided not to return to work and to hire someone who spoke Vietnamese to take of customers and we were pleased when my sister’s acquaintance approached her for the position. Although her salary expectation was steep for her resume, I agreed because finding an accounting graduate that spoke Vietnamese is not easy.

During our correspondence with our new hire, we told her we are expanding our operations. The goal was to scale her position to manage more employees. She sounded enthusiastic. Given the time and money we invested into her, and the fact it was tax season, we overlooked our short-term losses for the continued hope for a long-term gain for both parties.

She deteriorated to taking several days to complete files versus my mom (who started 3 months after her with no training) could complete in several hours, despite my mom answering every phone call for 2 different businesses and dealing with walk-ins.

It wasn’t just her incompetence, but lying about how she already emailed us/scheduled in the office calendar about her 1 week she “needed” off at the most hectic time of year for accountants when we had already informed all employees not to take any time off until after tax season was over in December. Knowing this we never would have let her step foot in the office. She told Christian’s mom that she decided to quit 2 months into the job and yet she did not resign and offer to return the vehicle in January in the mint condition it was in when we let her drive it. Instead, she dragged on for another 3 months weasling her way through her wages.

STOP THINKING SHORT-TERM

Its a huge mistake to focus on short-term gains at the expense of long-term gains. If she just existed and made sure her cost did not outweigh her output (no-profit for us but at the same time no-loss), I would have happily written her a recommendation letter and wished her well. But some people have the mentality: “I need to get what’s mine with as little discipline as possible.” If you don’t have leveragable skills then you will waste 20 months looking for a chance to start a 5-month job.

She put in so many hours at the office to pocket $4,000/month making her the wealthiest accounting intern in Edmonton. But at 28 years old, she still can’t afford her own car and lives with her boyfriend’s family.

Poor choice What to do instead
Waste time. Take longer only to get a worse outcome. Time is the only asset you can never get back- don’t waste a second. Hone skills minimum of 9 hours per day.
Spend 8 years getting by in a 4 year Bachelor degree without mastering a useful curriculum or leaving with any leveragable skills will leaving you unemployed or working at a soul crushing job. This life is 100x harder to fix. Most people should skip University altogether unless you attend an elite school and have skills leading you to a professional career (Engineering or Law).  Make the most of your time by getting the best grades in the shortest time so you can start your career ASAP.  Otherwise exhaustively learn code online or learn a trade.
Prioritize short-term gains. Prioritize long-term gains.
Prioritize earning. Prioritize learning.
Prefer empty unskilled jobs over careers and only care about their wage. Will choose a job that hones leveragable skills: ie sales and later an internship.
Stay in a dead-end job for 6 years, taking the path of least resistance,with no skill set to get out: this gives up decades of your life. Will only take a job while they are in school. They will move on to achallenging career and build a good foundation. Have more than enough time to have fun in spare time.
Lying only gives them short-term gains: ie. measly 5 month reward of leaching what they can. Honesty builds goodwill which is manifested in referrals, references, promotions and a lifetime of abundance.
Unskilled multi-tasking. Focused skilled work.
Do the minimum. Rich people should simply give to them in exchange for nothing. Focus on creating value which eventually makes their time valuable.
Expect to be handed a pamphlet that says “do X then do Y then do Z” and requires someone else to think for them. Sees their idiocy as lack of training, then complain when technology makes them obsolete. Revenue generating creativity: hard to replicate skills. Leverages technology.
Nothing is ever their fault. They love to tell you how hard and long they work =fake accomplishment & waste of life. Solving Problems = Hard Work.
Spend hours a week talking to the same friends about “life” results in nothing productive. Upgrade your social circle with like minded individuals and speak to them on a “on and off” basis.
Entertainment: TV, surfing the net, social media, video games. Entertainment (self-improvement):Read books 30 min – 1 hour per day.
Procrastinate. No time to procrastinate – too busy improving. 90% doing & 10% reading
Wanted a vacation 2 months into their first real job since they “earned it”. Does not engage in escapism (makes their own life great so they do not need to escape it).
Limit yourself to your home country. Go international.
Social Life>Health>Wealth Health>Wealth>Social Life
Gym everyday yet look worse and in poor health. Progressive weight training: Squats for everyone. Bench press for men.

There are two choices in life: Discipline or Regret. The rest is up to you:

Regret @ age 28 Discipline @ age 28
Make terrible decisions in life over and over again but believe they “could” be in the same position as you if they “wanted to” and will be “successful in the future”. Smile, nod and agree. But no sympathy for those who created their own mess.
Updates their resume and find another hourly or salary job that requires no skill set or responsibility. Focuses on honing skills consistently over dedicated time = success.
Waste time with losers – misery loves company. Referral credit from referring customers to accountants, lawyers, online marketing, etc. and no longer having to go out of the way to meet people.
Have a rental property when they don’t even own their own home outright. Thinking they are clever that their tenants nearly cover their payments. Consider an income property only after they have paid off the mortgage on their residence.
Don’t need advice because they know better and only ask advice for affirmation purposes. Take actionable proven advice.
Share with someone that could use some advice in this post or save some taxes
For every person you refer we’ll give you a free month or a gift card equal to 1 month of service of your referral – whatever is bigger! Up to to $600!
Anyone you refer gets a free month of bookkeeping!
THUT data capture technology extracts data from bank, credit card and online statements and allows for automatic bank reconciliation.
THUT uses artificial intelligence to locate and extract line item and tax summary data from receipts and exports it into a csv file.
Cleansing algorithms allow it to extracts transactional data that is 100% accurate.
Send us your prior financials and we will prove to you how our value is unrivaled in Canada.
➤➤➤

Self-made Multi-Millionaire Reveals 7 Swiss Secrets That Helped Him Get Rich

Foreign demand for Alberta’s natural resources contributed to our current situation.  Even THUT Accounting became too specialized in providing accounting to oil-field related businesses, leaving out the other sectors of the economy because of apathy.

Canada’s abundance of natural resources has interesting side effects. The trickle down of wealth erodes productivity and created a nation dependent on Alberta.

Adaptability and productivity stay low while increasing costs, inflation, and unemployment.

Even if you don’t work directly for the oil-sector, you may be adversely affected if:

  1. an increase in your mortgage rate would hurt your finances
  2. your mortgage is more than 2.5-4 times your gross annual household income depending on how much you put down
  3. you don’t have any real skills and think you can succeed in business

7 Swiss Tricks to 7 Figures!

The future will belong to:

  1. People who are the best at what they do through 90% doing & 10% learning.  Hone useful skills that allow you to deliver a service/product that people want and you can create opportunity regardless of the economic environment. Switzerland’s strong apprenticeship system has made it the most competitive country 7 years in a row.
  2. People with money. Strive to save 90% of your income.  Keep 90% of the above in investments and 10% cash. Don’t take this the wrong way, I don’t mean downsize your life. Instead, maximize your income so you are happy living on the other 10%. Follow metrics when buying a home.  Buy your car using metrics for yourself and not prestige for others. 12.7% of Switzerland’s population has a net worth over $1M vs. 1.4% in Canada.
  3. People who leverage technology. Online is the only path to scalability.  Switzerland has no resources but is ranked as the world’s most innovative country.

Paretoprinzip: Maximize the results by minimizing the stuff that don’t count:

  1. Don’t check your e-mail more than 3 times a day.
  2. Stop watching TV, surfing the net,  playing video games, and taking unnecessary vacations.  Make your own life great instead of engaging in escapism. The Swiss love outdoor adventure sport. Make your life so good you don’t need a vacation.  The only legitimate reason someone who is not financial independent should take a vacation is to visit family overseas.
  3. Trim your contact list – cut the complainers because chances are they already lost.

Switzerland has no natural resources, covered by inhabitable alps and can fit in between Edmonton and Calgary! Canada has 20% of the world’s fresh water but a Swiss company is the largest water brand in the world.

Share with someone that could use some advice in this post or save some taxes
For every person you refer we’ll give you a free month or a gift card equal to 1 month of service of your referral – whatever is bigger! Up to to $600!
Anyone you refer gets a free month of bookkeeping!
THUT data capture technology extracts data from bank, credit card and online statements and allows for automatic bank reconciliation.
THUT uses artificial intelligence to locate and extract line item and tax summary data from receipts and exports it into a csv file.
Cleansing algorithms allow it to extracts transactional data that is 100% accurate.
Send us your prior financials and we will prove to you how our value is unrivaled in Canada.
➤➤➤