Mark your calendars. April 24. You can buy your Apple wrist watch. Imagine! You can get phone calls. You can receive e-mails. Of special note, you can also tell time. The availability of the Apple watch also allows you to make a fashion statement. The “gold” version is $17,000. The new buzz-word is “wearable” IT technology. I’ve never wanted anything so bad in all my life. My heart is “a-twitter”.
In business (and personal investments), there is the term “sunk cost”. You save your money. You buy a recreational vehicle (RV) for $50,000. Then sh– happens. Gas prices go up so your cost of driving the RV increase. You decide you made a bad investment so you want to get rid of that “RV piece of sh–“. You put the RV up for sale. The highest price you can get is $30,000. Now you say “Oh, sh–! You decide you won’t sell the RV because you will have to deal with a $20,000 loss. No sir, not you. You will not take a $20,000 loss. So you keep the damn RV.
The truth is the $20,000 loss is real. It is “sunk” in a bad investment. You can lament about your poor investment in an RV or you can sell your RV for market value and get $30,000 cash (in your hand). Then you take the $30,000 cash and invest in something that might grow over time. Turn the investment into a positive. Buy stocks. Mutual funds. Property. Or better yet, send the cash to your Parents so they can improve their standard of living (imagine the positive good feelings you would get).
Dealing with the reality of a sunk cost (a loss if you will) sucks but dealing with it can lead to positive reward! A “sunk cost” represents bad karma.
Love,
Dad