Pillow Book of Talmud Wisdom

Chapter 30 Only Bugs Don’t Fall—Jews on Risk (2)
Another friend wanted to take the risk with Morgan, so the two pooled $10 and sent an attorney to New York to handle the claim.As a result, the agent came back from New York with a large amount of cash, which was double the original handling fee for the newly insured client.At the same time, the "trustworthy Itna Fire Insurance" had become famous in New York.After the fire, Morgan netted $15.

Being able to grasp the moment of truth can often turn a crisis into an opportunity to make big money.Of course, it is necessary to be good at observing and analyzing market conditions and grasp good opportunities.This is just as the "Talmud" said: risk and reward are directly proportional.

Avoid risks within a certain range
Here is a story about the American oil magnate John Rockefeller.

At the beginning of the 19th century, the German Metri brothers immigrated to the United States and settled in Mishapi. They accidentally discovered that Mishapi was an iron-rich mining area.So, they used the money they saved to secretly buy a large amount of land and set up an iron mining company.Rockefeller also knew about it later, but because he was a step late, he had to salivate aside and wait for the opportunity.

In 1837, the opportunity finally came.Due to the economic crisis in the United States, the Maitrie brothers were in a difficult situation.One day, a venerable local pastor came to the mine, and the Maitrie brothers hurriedly welcomed him into their home and treated him as a guest of honor.During the chat, the Maitri brothers inevitably talked about the country's economic crisis and their own plight. After hearing this, the pastor quickly took over the topic and said enthusiastically:

"Why didn't you tell me earlier? I can help you!"

The desperate Maitri brothers were overjoyed and hurriedly asked, "What can you do?"

The pastor said, "A friend of mine is a very rich man. In my favor, he will certainly agree to lend you a sum of money. How much do you need?"

"42 is fine. But, are you really sure?"

"Don't worry, I'll take care of everything."

Brother Maitri asked, "How much interest?"

The Maitri brothers thought it must be a high interest rate, but they were ready to accept it.

Who knew the pastor said: "How can I ask for your interest?"

"No, interest is still required. We are very grateful that you can borrow money for us. How can you not pay interest?"

"Well, even if the interest rate is low, 2% lower than the bank's interest rate, how about it?"

The two brothers thought it was a dream, and were stunned for a moment.

So the pastor asked them to take out their pens and ink, and set up an IOU:

"Today, the Metri Brothers borrowed a loan of 42 yuan from Kaur, with an interest rate of 3%. There is no evidence for this. Here is the evidence."

The Maitrie brothers read the paper again, found it correct, and happily signed it.

After half a year, the pastor came to the Metri brothers' home again, and he said to the Metri brothers: "My friend is Rockefeller, and he sent a telegram this morning, demanding that the loan be returned immediately."

The Maitri brothers had already spent their money on mines, and they had no ability to repay their debts for a while, so they were reluctantly sent to court by Rockefeller.

In court, Rockefeller's lawyer said: "It is very clear on the IOU that the defendant borrowed a Kaur loan. Here I need to explain the nature of the Kaur loan. The Kaur loan is a loan that the lender can claim back at any time. Therefore, its interest rate is lower than that of ordinary loans. According to the laws of the United States, once the lender asks for repayment, the borrower must either repay immediately or declare bankruptcy.

Therefore, the Metri brothers had no choice but to declare bankruptcy and sell the mines to Rockefeller for a price of 52 yuan.

A few years later, the U.S. economy recovered and competition within the steel industry became fierce. Rockefeller sold the Mishapi Mine to Morgan for 1941 million yuan.And Morgan also felt that he had made a cheap deal.

Some people may say that Rockefeller did not abide by business ethics.But Rockefeller didn't think so, he thought his actions were completely legal and just.Moreover, the highest purpose of business operations is to make money, and the rules of the game are not limited by morality.

When doing business, Jews regard shopping malls as battlefields and others as enemies. They are highly vigilant and never give up their vigilance.

Even if it is his own wife or husband, he treats him as an outsider and never trusts him easily. This is also a wise move for Jews to guard against transaction risks.

research before making a decision

From a business perspective, Jews are not doing business but "managing risk."Sometimes Jews prosper by investing precisely in this "risk."

Hammer's greatest success was during the Italian occupation of Libya, where Mussolini spent about $1000 million in search of oil and found nothing.The Esso oil company was preparing to retreat after spending millions in ineffective expenses, but it was pumping oil from the last well.Shell spent about $5000 million, but none of the wells produced were of commercial value.

When Occidental Petroleum Corporation arrived in Libya, the Libyan government was preparing for the second round of negotiations on the sale of leased land. Most of the leased areas were leased land in Libya that had been abandoned by some large companies.According to Libyan law, oil companies should develop their leased land as soon as possible. If no oil is extracted, they must return part of the leased land to the Libyan government.The second round of negotiations included several "dry well" lands, but there were also many desert lands adjacent to oil producing areas... More than 9 companies from 40 countries participated in the bidding.

Although Hamer is full of confidence, his future is uncertain.Although he has a good personal relationship with the Libyan king, he is inexperienced in this area, and his competitive strength with those oil giants is too great.

Hammer's directors flew in and bid on four leased lots.His bidding method is unusual. The bidding document is in the form of a sheepskin certificate, rolled into a roll, and tied with red, green and black ribbons representing the colors of the Libyan flag.In the text of the tender, Hamer added that he is willing to use 4% of the gross profits that have not been tax deducted for the development of agriculture in Libya.In addition, a promise was made to find water in a desert oasis near Kufra, the birthplace of the king and queen.In addition, they will conduct a feasibility study.Once water is extracted in Libya, they will jointly build an ammonia plant with the Libyan government.

In the end, Hamer finally got two leases, which surprised those powerful opponents.These two leased lands were given up by other companies for nothing after spending huge sums of money.These two leased lands soon became the source of Hammer's troubles. The first three wells they drilled were all dry holes that did not see any oil, and the drilling fee alone cost nearly 300 million yuan.In addition, another 200 million yuan was used for earthquake detection and bribes paid to Libyan government officials.As a result, many people on the board began to call this ambitious plan "Hammer's stupidity." Even Reed, Hamer's confidant and the company's second largest shareholder, lost confidence in it.

But Hamer's intuition prompted him to stick to his guns.During the weeks of disagreement between entrepreneurs and moneyholders, the first well produced oil, and eight others since then have produced unusually high-grade crude.More importantly, the oil field is located west of the Suez Canal, so transportation is very convenient.At the same time, Hamer also drilled a coral oil reservoir well with a daily output of 703 million barrels of automatic oil injection on another leased land, which is the largest well in Libya.Then, Hamer invested 1.5 million yuan to build an oil pipeline with a daily oil delivery capacity of 100 million barrels.At that time, Occidental Petroleum's net assets were only 4800 million yuan, which showed Hamer's courage and courage.After that, Hamer boldly annexed several large companies.In this way, Occidental Petroleum Corporation became the eighth sister of the world oil industry.

Like Hamer, Jews rarely invest in risk management with subjective emotions.Even in speculative business, the Jews are very particular about safety and reliability.

In English, "speculation" and "investigation" are synonyms, and Jewish speculation is the best interpretation of the word.The investigation of the Jews does not only look at the circulation of commodities, but also the condition of the commodities to be bought and sold after resale or exchange, and the final satisfaction degree of the parties to the transaction.The speculative business that the Jews finally decided on must be a commercial behavior based on careful and careful thinking.

Don't wait for something you're not sure about

"Talmud" said: "Just knowing how to wait and endure is not real wisdom."

Although the Jewish nation is best at waiting and patience, their waiting and patience are principled.They are the best at calculating, and if they think that a certain business is indeed profitable, they will wait patiently and wait for the opportunity; however, Jewish businessmen never do things that are not sure.Once they find that a certain business is uneconomical, no matter how large the investment is, they must find ways to clean up the defeat.Needless to say three years, even half a year will not continue to wait.They will flatly give up the "opportunity to make a lot of money".

Smart Jews also understand: you can't always wait for the greater good.The following story is a vivid interpretation of this wisdom.

One day, Levan, a Jewish rich man who made his fortune by speculating in stocks, watched his 8-year-old son catch birds in the yard.

The tools used to catch sparrows are very simple. It is a small net with wire circles around the edges. The whole net is round, and one end is supported by a wooden stick.A long rope is tied to the stick, and the child hides inside the house by holding the rope after he scatter the rice grains under the erected round net.

After a while, a few sparrows flew over, and the child counted them, and there were more than 10 of them!They must have been hungry for a long time, and soon 8 sparrows got under the net.Levan signaled to the child that it was time to pull the rope, but the child did not, and he quietly told Levan that he would wait for the two outside the net to get in before pulling.

After waiting for a while, instead of going in, those two came out, but four came out.Levan again motioned to the child to pull quickly, but the child said, "Don't worry, just pull the rope if another one walks in."

But then, three more sparrows came out.Levan told him that if he pulled the rope now, he could still catch one.But the child seemed not reconciled to the lost good luck, he said, there must be something to go back, just wait!
Finally, even the last sparrow was full and went out.The child is very sad.

Levan stroked the child's head and taught lovingly:

"Desires are endless, but opportunities are fleeting. Many times, blindly waiting in order to get more without taking decisive actions will not only fail to satisfy our desires, but will also cause us to lose what we originally had."

(End of this chapter)