Saturday, 14 May 2016

The Prosperity Formula

Michael Milken

Many years ago Michael Milken, a very bright man, went to prison for breaches of U.S securities law. He is now one of the leading organizer on medicine research on cancer himself a battling cancer survivor. I was introduced to him sometime in the 1980s, better known then as the "Junk Bond King".

I was impressed with his brilliance, and sometime after he was release from incarceration I continued to follow him through Milken Institute and Milken Foundation for which I'm a subscriber. I believe he is doing important work giving back to society. He has paid more than his price to society and he has also left a prize for the rest of society none better than the prosperity formula in my view. Of course, this is not to take anything away from the compounding interest and the others from Einstein and Pythagoras.

The formula he designed on prosperity goes a little something like this;

P= ∑FT;*(∑HC;+∑SC;+∑RA)

FT= Financial Technology
HC= Human Capital
SC= Social Capital
RA = Real Asset

I have given this formula much scrutiny and thoughts. I have found it to be very relevant to any success one desires to have in pursuit of prosperity.  The prosperity formula is important work and I think you should listen to Michael Milken explains it for you too.

In his operating years in the securities industry, he understood financial engineering and he also knew that with the right technical arrangement of capital he could make a real difference.

No prosperity can be achieved without human capital whether that form of capital comes in the form of skills, knowledge or ability of some kind. The aggregate of human capital compounded will sure make a difference, Nebuchadnezzar knew this very well when he set about building Babylon, he knew the power of people to the kingdom at that time and so did the United States of America as it grew over the years with people coming from around the world to form the great melting pot of skills and entrepreneurship. Humans can't achieve its objectives unless with some social contract of some sort, The is a different kind of capital.

The social capital in this formula for me is the agreement to abide by the rules of law no matter who you are. It is also the understanding that the common objective in achieving this one thing and that this one thing is agreed on in the direction we take collectively as a group or society. Not only are the financial technology, human capital and social capital important, but so is the real asset.

Real asset is critical to any leveraging ability that you may have. It is what the financial technology is more likely to be formed around to get the capital in the first place. Although it is on the back-end of the formula it is just as important as any other. The person who has this real asset does not necessarily have to be you, but if you bring whomever it is that has it to the table, that is the starting point. Real asset can be real estate o financial asset and either of the two will work.

The prosperity formula if applied with the summation of the four components, prosperity is sure to come your way.

Prosperity= ∑FT;*(∑HC;+∑SC;+∑RA).