May 22, 2013
How to Be a Billionaire
Posted on Feb 1, 2011
All you have to do to be a billionaire is to have an idea. John A. Paulson had an idea, and in 2010 his idea made him $5 billion. His idea was to buy gold. If only you had that idea, you would have made billions too, because the price of gold increased by 30 percent in 2010. You, on other hand, put your money, all $17,000 of it, into Apple stock instead. That stock went up by only 68 percent, and about you, naturally, they did not write in the papers, because your idea was not even half as good: All you made was $11,560.
Now, if you had Paulson’s idea and invested $17 billion in gold instead of $17,000 in Apple, you would have had $5 billion too.
Moshe Adler teaches economics at Columbia University and at the Harry Van Arsdale Center for Labor Studies at Empire State College. He is the author of “Economics for the Rest of Us: Debunking the Science That Makes Life Dismal” (The New Press, 2010).
—Posted by Moshe Adler.
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