During the summer an ant prepared for the winter season.
While he was busy gathering food (savings) in his nest, a grasshopper was singing, without a care in the world.

When you think about this story about an ant and a grasshopper, the ant's behavior consists of making an investment through the labor force, from which he made an "economic gain" (profit).

On the other hand, the grasshopper's action might appear to be nothing but pleasure, but pleasure can be an investment through which we make our own "psychological gain" (benefit).

When food runs out in winter, the act of an ant eating food gathered during the summer is an investment - making the "psychological gain" (benefit) of fulfilling his own appetite, which one can make a case for being the same as that of the grasshopper's dance in summer.

In other words, the act of the ant brought psychological benefit in winter by preparing for the economic profit in summer.
The act of the grasshopper brought psychological benefit in summer, but it was too late to make an investment through the labor force when winter came.

This says that investment opportunities are not always with us and that missing an investment opportunity could cost us our lives.
Also, before gaining benefit through consumption investment, one must gain profit by placing productive investment ahead of it.

Along with the lesson of "If you won't work you shan't eat", we humans should replace summer with "before retirement" and winter with "after retirement."

Let's go a little further.
On the surface the ant appears to be right and the grasshopper appears to be wrong.
However, glorifying the ant's behavior, or to think that investment through one's own "labor force" alone is right, is very dangerous.

It is fine when the ant is healthy enough to work, but by the time he is no longer capable of gathering in summer enough food for winter his fate becomes the same as that of the grasshopper.
Both ants and grasshoppers are bugs, after all.
They don't understand investment through "capital strength."

We humans are not bugs.
If we were the ant, when the grasshopper came to get some food in winter (investment opportunity), we could have thought about lending food to the grasshopper and having him pay back with interest next year (investment through "capital strength").

Also, if the grasshopper were human, with "capital strength" and a correct understanding of investment methods, he could have lived his whole life doing whatever he pleased, by making investments through his "capital strength".

As for saving for the future, some want just enough for the husband and wife to live comfortably, while others, like landlords and business owners, need to pay a lot of inheritance tax.

So, how much we need depends on us, but the time will come to us all when we are no longer capable of working.

"A compulsory investment of capital strength" (pension) is not enough for the long winter (our post-retirement years).
What is important is not missing "investment opportunities" - and capitalizing on them.
Investment through one's "labor force" and "capital strength" are essentially the same for as long as they are good investments.
Two investment methods are investment through one's "Labor force" and one's "Capital force".
Returns on investment are "economic gain" (Profit) and "psychological gain" (Benefit）.
When it comes to investment and return on investment, it is important to make investments with an understanding of the balance between - and priority of - the two.

Mar 06, 2008 Makoto Nozaki

Even when we understand something, it is not always easy to put it into practice.

It is not easy to communicate all our ideas to others. It is always difficult to walk the talk, because when we want to express ourselves the only means available to us are words and actions, and those who do not practice what they preach will not be trusted by others.

There are not very many people who can do this perfectly, but we must make sure we are not lazy in our efforts to be consistent in our ideas, words, and actions. By trying hard, we can make our lives run more smoothly, without stress. Many people are considering some type of future investment, and many of those have high expectations of real estate investments, as well as other ones.

Some of them are probably considering investing in income-producing properties, and still others have already asked a realtor to let them know if there is a good property available. There are very few, however, who have already purchased an income property.

The reason is as follows. Going to a realtor's office and asking them to let us know of a good property sounds like action, but in reality it is just words. Real estate investment is not so easy that we would be able to succeed merely by waiting for leads from a realtor.

Asking a realtor to let us know about a good property is about the same as telling our friends that we are considering real estate investment, in my opinion.

If we are considering real estate investing, the first thing we have to do is to acquire the appropriate knowledge, in order to make judgments about property values.

It is meaningless to collect information by asking realtors to let us know about good properties if we cannot determine whether they are truly good or not.

If we let others make that judgment simply because it feels like too much trouble to us, our venture will inevitably fail at some point.

Conversely, knowing what properties are valuable and which ones are not will help us determine what to do to increase the value after the purchase.

To realize our ideals and future dreams, we need to act.

It is difficult when we are not used to it yet, but once we are accustomed to it, it will become fun. Only those who take risks and do something about their ideas can proceed to the next step.

Investment is like a game. Someday, there will be a result. That which is guaranteed of success is not called investment.

Every investment has risks as well as returns.

If we want to avoid losing at any cost, we have the option of not playing the game, but the choice of not investing could also ultimately lead to wins or losses. Furthermore, life without investments would be difficult and devoid of enjoyment.

may 28, 2007 Makoto Nozaki

Management is a lonely task. We have no one but ourselves to depend on to keep increasing the value of the company. Every day is a trial.

If we become lazy, our company will fall in value, or even disappear altogether, and be superseded by others. Creating value for a company is like creating a piece of art.

Just as in creating a piece of art, creating value is accompanied by tremendous hardships (though some creative people may be geniuses), but the feeling of an accomplishment cannot be surpassed by anything else in this world.

Whether in art or in management, some people are superficial and transitory - completely without content - whereas a truly great piece of art is imbued with internal values, and thus it impresses those who see or listen to it.

The same is true of management. Those who seek the internal value of the task at hand will impress their clients, and only companies that can keep doing this will survive.

The same can be said about rental management. If we are unable to provide value to our clients (the landlords), the value of the assets will disappear, then others will supersede us, and our management will be seen to have failed. In real estate investment, unless we can do it all, it is very important for us to find trustworthy partners.

may 25, 2007 Makoto Nozaki