Is it time to question capitalism?


As much as I teach about finance and money management, I have often said that the system needs to change. We have to find a better way for production, distribution and income/wealth allocation that is more just and equitable.  As it stands today, we have the majority of the world’s wealth in the hands of a very few at the top. Before we can even consider finding a better alternative, we must first understand what we currently have. The question we must ask is, “Is capitalism working for us, or are we simply working for it”?

This is a multifaceted problem. Politics, ideological beliefs and social norms are well entrenched all over the world. We cannot divorce these factors from the problem of inequality. It really goes beyond the numbers.  It is my hope that these posts motivate you to question and not accept the system as given. Change that comes from below will be stronger and more powerful than when it is dictated from the top.

I am surprised to see how my own views have changed over the years. I was once a staunch capitalist. I sang the virtues of capitalism and was confident that it can solve all problems. As with most things, the more you study and observe, the more you learn and sometimes it’s a hard lesson. Today, I question it all. The theory of capitalism and the practice of capitalism is not always the same. In practice, there a many stumbling blocks to the naturally efficient allocation of resources through the capitalist system.


True capitalism is a mode of production in which there is NO government intervention and the means of production and distribution is entirely in the hands of private owners. This means no government provision of public infrastructure, no regulations, no taxation and no government support programs.  In reality what we have are mixed economies, where both government and the free market exist side by side.  The portion of government versus free markets is the point of political differentiation.

Government and free markets act as a check on each other. In the case of government it can reduce some of the negative aspects of the free market. One of the main one is preventing the formation of monopolies. A monopoly exists when one company controls the supply of a goods or services and can charge whatever price they want.  Government regulation allows for more competition and thus gives consumers more choices and thus better prices.

Government intervention is necessary also to protect private property.  The free market is all about self-interest.  Capitalism is not concerned with equity. Self-interest is the name of the game. It is often argued that self-interest and the desire for wealth maximization is the driving force for efficiency, innovation and economic development. Often in pursuing the goal of wealth maximisation private owners don’t take into account external costs. External costs are the result of doing business that affects others who didn’t ask for it. A classic example is pollution and in this case government intervention is welcomed.

How much should the government intervene? Well, this is the age old question. Not enough government intervention and we have out of control laissez-faire. Too much government intervention and we end up with large bureaucracies and bottlenecks in a self-regulating market system.


One of the biggest arguments against capitalism is that of inherited wealth and wealth inequality. In a capitalist society one has to legal right to pass on private property to future generations.  This means there is a segment of society who is rich because they inherited their wealth.  In this case there is no avenue for or even the opportunity for wealth equality. This creates an oligarchy, where a small group of individuals have controlling interest in the country.

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First of all we can’t begrudge those who have inherited wealth. It was their good fortunate to be born into that family. Also, we can’t deny people who work hard so that their children do not have to. What can be done however is stop putting policies in place to make those who are already wealthy even wealthier. No one is trying to deny anyone their right to their wealth. At the same time, there must be fairness. It is not fair that policies are put in place to ensure that already wealthy segments of society, maintains and grow their wealth at the expense of the other segments in society.


In Canada the introduction of the Family Tax cut does not benefit everyone. It only benefits those in the higher income brackets.  It has no effect on the average income earner. This means that those who make more money can save on taxes, and have more after tax income. While those who need the most, don’t get it. Also the increase in child care benefits is not tax free, so while the Harper government is giving you more, they are also taking back most of it. We really have to ask the question, who or which segments of societies are really benefitting the most for these government policies.

It’s time we use self-interest to benefit all. We need to get a government that would look after the interest of the masses and not of the few at the top. Let common sense be our guide this election season. Several think tanks and studies have shown that only 15% of Canadian benefit from the Tories’ plan and that although the middle class benefits, lower income families are disadvantaged. We are sure to be bombarded by numerous ads the campaign period. Pay attention and see which party is talking about you, if the ads are only to decimate their opponents and doesn’t show you how they will benefit you, move on to the next.

Getting involved and deciding who you will elect to run the country you live and work in, is the first step on the path to change.  We all need to become aware of what is happening right in front of us and realize that together we have enough power to make a change. If we continue to be distracted by media sensationalism then we will continue to have more of the same.


The best I have heard so far is the Liberal government’s “fairness” plan. They plan to:

“…Scrap the Conservatives’ income splitting plan and replace it with a cut to the middle-class tax rate, to 20.5 per cent from 22 per cent. Every Canadian with taxable income above $44,701 would get a tax break worth up to $670 per year

…Cancel the Tories’ recently announced boosts to the taxable Universal Child Care Benefit (UCCB) and replace it with a “Canada Child Benefit” that would provide larger, tax-free, cheques to middle and low-income families, worth up to $533 a month.”

The question should not be if Justin Trudeau is ready, it should be are YOU ready and willing to do something that is in your best interest.  Sometimes a little common sense can go a long way.

Dr. M


Chill out for it to work out!

In economics there is the concept of diminishing marginal utility. This means that the satisfaction we derive from the consumption of the first unit of a good or service is the highest but it declines and continues to decline thereafter. For example, the first bite of a piece of decadent chocolate is miraculous, the second bite is great, but by the 20th bite you’re like “eh”.

We are inundated with information from all over the internet non-stop. Facebook, Twitter, Instagram, Pinterest. Each post and article seem to have the answers we are looking for, lose 10 lbs in two weeks, how to get out of debt, the top 4 reason why women need to know about finance.  After a while it gets to be too much or we become desensitized to the problem or issues. We all succumb to this law of diminishing returns. It’s like when we go shopping for perfume. After you smell a couple of scents, your nose loses its ability to distinguish between the scents. You need a whiff of coffee to clear the nose so that you can take in and appreciate other scents.

Quotes About Life distance

Today is your whiff of coffee. Take a break from whatever it is you want to achieve. If you have been working steadily towards your goal thus far, then you can afford to rest. If you have been struggling, let it go and take a break. Gather yourself, take a breath and come back. Taking a break allows your brain to marinate the issue.  Creativity theorist calls this “incubation” it refreshes the mind and allows a solution to arise on its own.


Some suggestions for incubation:

  • Unplug for a couple of hours, for a day, for the weekend. If you can, unplug for the weekend, if you can’t start with an hour a day.
  • Do something that you don’t usually do, take the afternoon off. Take a walk in nature. Go for a swim.
  • Get good quality sleep it improves your: memory, creativity, immune system and it reduces stress.


Take a break and let it all digest. See you next week.

Dr. M

The Top FOUR Reasons Why Women NEED to Understand Finance

Woman Holding Cash
Woman Holding Cash

Across the board, in all countries, women own fewer savings accounts than men. Holding constant all the economic and sociological reasons for these differences, the point it is that even in developed countries women still struggle with the topic of finance. Whether they are entrepreneurs (investing in the least capital intensive businesses), workers (who earn only 77% of what their male counterparts earn) or whether they are stay at home moms (unpaid work). At all levels women are not on par with men when it comes to finances.


Here are the top four reasons why all this matters and why we need to bring more light and discussion to this area.

No. 1                    Women are still the primary caregivers in the family


Both parents play an important role in shaping the outlook of a child. However, it is the mother who has the greatest influence on a child. The children that they raise are the future workers and consumers of tomorrow. The morals, values and life skills that they impart to their children will be reflected in society. Let’s face it, we all brainwash our children from the time they are born, just like we were brainwashed when we were born. Children come into this world as a blank slate “tablua rasa”.  From the time they enter the world they are bombarded with everything in their environment and they learn consciously and unconsciously.  Whatever behavioural traits children assimilate at home it will stay with them for the rest of their lives.  In a 2009 study by the National Endowment for Financial Education, it was found that “direct teaching from parents is more influential on the financial habits of young adults than work experience or high school financial literacy courses.” This means that means that if you are a financially savvy parent, chances are so will to will your children be. The converse of this is true.   So the onus is on the primary caregiver, the mother, to be financially literate, so as to ensure that their children have the right skills and knowledge needed to navigate the world when he/she leaves the nest.


No. 2                    Women are usually in charge of the day to day expenses of living

In the words of the executive director and founder of the Institute for Financial Literacy “Mothers have traditionally adopted the role of managing the day-to-day finances, such as paying bills, buying groceries and shopping for clothes.” As such women need to ensure that they have core financial skills at their fingertips. Having good budgeting skills is crucial to the financial survival of the family. It is the day to day finances that make or break households not the major purchases.  It is important to monitor everyday finances and use money effectively to avoid “leaks” that really hurt over time.


No. 3                              Women have to break the stereotype

The best place to break stereotypes is at home! Too often in my practice, I see brilliant women shy away from dealing with their finances. They succumb to the myth that men are better at math and finance. The actual research in this area shows the opposite.  There are numerous studies which show that women make better investors than men because of their gender difference. Women are better with money because they are more risk averse and as a result tend to take on less debt. Women are also less arrogant than men when it comes to investing. They will seek advice and ask for assistance when necessary.  Men have the affliction of overconfidence and it leads to excessive trading that hurts their portfolio performance as noted in the study Boys Will Be Boys: Gender, Overconfidence and Common Stock Investment.

Children, boy or girl will benefit tremendously from a mother who is financially knowledgeable. The Mom is a role model for both genders. Girls will get the message that they are very capable of managing money. While the boys may even pick up some of the Mom’s management skills and take it as the norm that women are capable of managing money. In either case, when the mother is financially literate the stereotype starts to crumble.


No. 4                   Women get divorced and they live longer

The OECD, along with several other studies, have shown that women tend to have lower levels of financial literacy both in developed and developing countries. This is not good. Women NEED to understand and know how their finances work. First of all, divorce rates are high, 40-46% of marriages in North America end in divorce. This is a reality that women need to be prepared for.  When a woman leaves all the financial matters of the household to the husband, it often leads to unfair and complicated consequences for her in the case of divorce and death. Prenuptial are important, especially if the woman entering the marriage has a high net worth. I tell all my single and affluent female clients “when you get the ring, be sure to give me a ring”.  As an advisor, I play devil’s advocate and take care of the practical side of the romance, i.e.  the finances.

When I advise older couples I make it a priority to educate the wife if she is in the dark. Usually there is a generational tendency not to be concerned and don’t want to bother with all the details. My job is to ensure that she gets a general understanding of how the family finances are structured. She doesn’t need to know all the specifics, but she should have an idea of where things are, why and how it affects her.  The initial resistance disappears when she realizes that it is not as intimidating or complicated as she first thought it was.


Money management is a life skill that everyone requires regardless their gender. It is important that misconceptions and perceived limitations are addressed and mitigated because to leave the status quo as is, will continue to do more harm than good.  Women need to stop being marginalized when it comes to money and start taking their rightful place at the helm.


Dr. M


When is the right time to talk to your kids about Money?


In 2014 the Bank of Montreal found that Canadian parents would rather talk to their kids about sex than they would about money. There are several reasons for this. The first and the most common reason is that parents don’t feel confident in their own money management skill. Unfortunately, we were not brought up learning about money either at home or at school. Money is a touchy subject in many households. The attitude, ranges from it’s vulgar to discuss money to the ostrich effect, if we avoid talking about it, it will go away!  How can we then expect adults to take charge and teach children about money?

Fortunately, this can be remedied. There are many books, courses, and workshop that teach personal finance. It is worth the investment of time and money in this pursuit, as it will serve both you and your children in the long run.  There are several great authors on this topic; Gail Vaz Oxlade, David Chilton, Robert Kiyosaki, Dave Ramsey and Susy Orman.  I would like to (humbly) add to the list the TKS Financial Caregiver’s Manual. The purpose of the Manual is to provide caregivers with enough information to either reinforce or build their confidence in managing their own finances so that they feel prepared enough to teach their children these skills. The manual also guides parents on how to impart these skills to their children.

Another reason that parents don’t want to talk about money is that they know they have bad habits. They know that they can’t practice what they preach and this prevents them from having the money talk with their children. A less obvious reason is that it makes life all too real. I remember when I was growing up I didn’t care nor did I want to hear about my parents’ finances. I didn’t want to think about the finiteness of it all. I preferred not knowing and I just wanted to believe that my parents had a bottomless pit of money.

It seems that making a child aware of the realities of money robs them of their childhood innocence. Children should not be “burdened” with this issue at such an early age. They should be playing and having fun. As a parent, I totally understand this perspective. Parents want to protect the innocence of their children. We do our best to allow them to be free to dream. The thing is, it is possible to ground them in practical logic and at the same time encourage infinite creativity.


I recently came across a review (I haven’t read the full book) of a book entitled The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money by Ron Lieber. The reviewer noted that the book recommends that parents have a formal discussion about the household finances. The author also recommends telling kids how much you earn and how it compares with your peers. I am not sure about some of these recommendations. I think it’s too much information for young children and even for teenagers. It all depends on the temperament of the child to handle such information. I think there may be some negative fallout in the future from telling your kids how much you earn and how it compares to your peers.  Another suggestion from the book was that parents should institute “fun ratios” which requires the family to itemize every toy in their kids’ possession and calculate the hours of fun divided by the cost of the toy. This “fun ratio” will then be used as a yardstick to determine future toy purchases. I love finance and calculating ratios, but I think this task would make me pull my hair out.

Based on the review of this book, a few things stood out. The first is that parents don’t want to talk to their kids about money and now they are being asked to make it official, organized and do a lot of work/calculations. There maybe a few families who may find this method appealing. I think, however, the majority of families would not find this an enjoyable task. Even if they initially employed this method, I am not sure how long it they would continue doing it.  Secondly, all these ratios and discussions about earnings, etc. are a topical solution.  If a child has not been taught the correct behavioral traits to deal with money, you could talk until you’re blue in the face, it would make little difference in the end.

It is possible for children to learn money management while playing and having fun. I call it teaching in stealth. It doesn’t have to be painful to teach children about money. In fact, teaching children core money skills, is really teaching them life skills.  The heart of the matter is that kids need to learn how to make effective choices. This implies that they learn core principles in a natural way.  If we make a big fuss about finance then it will be how the child deals with money, as a chore and a pain. If we make it a natural and fun process, then the child will have a better relationship with money. With the proper training we can instil in children the behaviours that would lead them to make good choices, save and spend wisely.  Making good choices, saving and spending wisely, are the holy trinity of finance. When a child understand and master these core skills, then you can implement tools, discussion and ratio and the like. Only then will the tools, etc. will have meaning and be of value.


In my own case I started early with my daughters. One of the first things I taught them was the difference between needs and wants. This lesson carries itself over not just with money matters, but also with food, drink, entertainment and even activities. We don’t live life in compartments, it’s all interrelated.  The things we learn in one area naturally carry over to other areas of our lives. My goal is to train my girls in a logical manner and simultaneously encourage them to dream and create. Like most parents, I do the best we can for my kids. This is my way of preparing them for the world. Every day is the right time to talk to your kids about money.  Every day presents an opportunity to caregivers to teach children important life/money lessons.

Dr. M

Do you know where your money comes from?


I think sometimes we forget that money is just a TOOL. It is an artificial construct used to perform specific functions. The main function is to make it easier to trade. Over the years money has taken on a personality and a mysticism of its own. We give up our time and freedom in pursuit of making money. I teach children and adults how to put money into its proper perspective. For sure money plays a crucial role in our lives.  It pretty much governs what we eat, where we live and what we are able to do in life. Having said that, I think if we separate the mysticism of money and understand it from a practical perspective, we can be the one in control rather than it being in control of us.


Before we had money we had the barter system. Here we traded things for things.  I can trade some of my wheat for some of your eggs and everybody is better off.   There were a few hiccups with this system however. The first was that there needed to be a double coincidence of wants. This means you must have what I want and I must have what you want for us to be able to trade. So if I had a hankering for eggs and I had corn to trade, I had to find someone who wanted corn and had eggs to trade.  As you can imagine, this was not always possible. The second drawback was that most of the items were perishable. Therefore, if I couldn’t get it traded soon enough, it could either spoil or in some cases die (animals).  There was no store of value. I couldn’t save it for later. Finally, many of the items were not divisible. Let’s say I wanted eggs and only had a cow to trade for it. If I did find someone who had eggs and wanted some meat, I would have a hard time just giving them a leg or shoulder.  What would happen to the rest of the cow?

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“Money” emerged as a way to overcome the shortcomings of the barter system.  Remember money is just a medium of exchange. It negates the necessity for a double coincidence of wants and allows one to store and keep the value over time. Many items have been used as a medium of exchange, grain, cowrie shells and beads.  Over the years, it transitioned to silver and gold.  Money as we know it today had its origins with the goldsmith. The goldsmith was the only one who had well protected vaults. As such, they were entrusted to keep the gold safe from pillagers. They would receive the gold and issue a receipt to the depositor. There was of course a fee charged for this service.  The owner of the gold could then claim all or any part of the gold whenever he needed. Instead of moving the actual gold around, people started trading their receipts for payment. The receipts were widely accepted because everyone knew they could redeem them at any time, in effect, “they were as good as gold”.

Over time the goldsmith made an interesting observation, one that changed the way the system worked. They realized that not everyone would cash in their receipts. This meant that they always had a reserve of gold sitting in the vault. The clever goldsmith then started lending this money for a fee. In effect they started creating money. If the goldsmith had 100 pieces of gold and only 10% of that was redeemed. It meant that they would have 90 pieces at any one time in their vault.  They decided they could lend out 90 pieces of gold and make some extra profit.  When other villagers borrowed these 90 pieces of gold, it meant that now there were 90 more receipts being traded (these were not actually back by gold).  Technically speaking, if everyone who was holding a receipt came at the same time to redeem their gold, some people would be very disappointed because the goldsmith would be 90 pieces of gold short. Some people would not be able to collect their gold because it did not physically exist.


Modern day bankers create money in a similar fashion. Banks use the fractional reserve system. This system requires that banks keep only a fraction of bank deposits as cash on hand to be made available for withdrawal. For instance, banks are required to keep 10% of their holdings as reserves. If a bank has $100 in cash it means it could lend out $900. The $100 in cash is the required cash reserve, which represents 10% of $1000 ($900 loans +$100 cash=$1000 and 10% of $1000 is $100). Therefore, with a deposit of $100 the bank can create $1000 of money in circulation, $100 in cash and $900 as loans.  Essentially, those notes and coins that we work so hard for have no intrinsic value. They are only valuable because it is widely accepted. It is fiat money, money that is based solely on faith and the confidence we have in it.

When I explained this to my seven year old daughter (using strips of paper and fake gold coins), she immediately told me that it was wrong and that the banks make no effort. We make the effort (meaning we work) and they take our money and make more money for themselves. She told me we have to call the police!  She got pretty heated and advised me NOT to put my money in the bank.  In her own way she echoed the words of the late Murray Rothbard “Fractional reserve banks…create money out of thin air. Essentially they do it in the same way as counterfeiters.”

Be that as it may, today we need the banks. There is no denying that banks are vital to the economy. They are the financial intermediates that match lenders and borrowers. They are integrated into both the consumption and production side of the market. They lend to businesses which enables the business to grow and expand and hire more people. As employment increases people spend more, business then expand more and hire more people and the economy grows. When the banks give credit it causes people to spend more and this increases the demand for goods and services, business thrive and expand, thus hiring more people and these workers in turn spend more and a virtuous cycle is created.  Banks have embedded themselves into our lives to extent that we need to be part of the system to be able to function and live. From our salaries to our mortgages and everything else in between we need the banks.

While it is true that we need them, it does mean we have to be pawns in the system. We have the power to take charge of our finances and make the system work for us rather than us working for the system. It is easy enough to do, but it would require a shift in mindset and behaviour.

We all have the power as a consumer.  Not because credit is easily accessible and widely available does it mean you have to take it. No one forces you to spend beyond your means. There is no law that says YOU must incur credit card debt. We do have a choice in the matter. The question is whether we want to make that choice.  It really goes back to fundamentals.  Do you really need half of the stuff you have? More importantly, what motivated you to get all that stuff in the first place? What are you trying to do, to prove, or who are you trying to be or to impress? In the end you can either take charge of your spending and consumption or it will take charge of you. It is as simple as that. Regardless of whether or not the banks are swindling us or whether they tempt us with higher credit limits. There is NO reason for to spend if you don’t have to.


If you don’t incur debt in the first place, you will not have to pay their large interest fees. The trick is to understand how to use credit to build your net worth rather than letting it destroy you. It can and is being done. Remember, it is to the bank’s advantage to see you in massive debt. It is more revenue for them because foreclosure is profitable. They don’t force you to be in that position, they just lure you in and if you fall for it, well, that’s too bad for you, but it’s great business for them!

Take the time to put money in its rightful place in your life. If you want to learn more about how to do this feel free to contact me.

Dr. M

Watch out for the Sun, it might be burning more than your skin!

Dr. M Finance Blog


I was born on a tropical island and whenever I heard the phrase “Oh, what a lovely day” in a movie or in books I never really got it, because for me every day was lovely.  It was not until I moved to a temperate country that I really understood what a lovely day is!  Bright sunny and warm days are the quintessential lovely days. It makes us happier. The sun rays give us vitamin D and nourish our immune system, why won’t we be happy?  It’s wonderful to see the transition from winter to spring and finally summer. People keep getting happier and happier and it all explodes in July and August!

It is well known that when we are happier, we tend to spend more, our generosity for ourselves and others expand. It’s not just in our heads. There have been numerous studies since the early 1970s that…

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A Systematic Approach to Overcome Overwhelming Choices

It’s  always a good thing to have many options to choose from. Whether it be food, entertainment or life partners, we all want to know that we have more than one choice. But, is having too many options a bad thing? In one word: YES. Sometimes having too many choices paralyzes us and makes us worse off because we either end up doing nothing or making a choice and always feeling unfulfilled.


In the world of consumerism, it is a good thing to have many choices because competition drives prices down and give the consumer more for less. When there are many players in the industry, consumers have the upper hand.  However, when there is a monopoly or an oligopoly, producers have the upper hand because they control the supply. Consumer have little choice and generally get the short end of the stick. Examples of monopolies are Luxottica  and Monsanto.  If you wear glasses, chances are that they came from Luxottica because this company produces over 80% of the world’s major eyewear brands. Another example of a monopoly (one which I personally don’t like ) is Monsanto. Monsanto has a monopoly on seeds, over  80% of the corn grown in America is from Monsanto.

Clearly, as a consumer we are better off when there are more players in the game. However,  because something is good, it doesn’t necessarily mean having more  is better. One of the downside of  having too many options is paralysis by analysis. This occurs when we are faced with too many choices an find it difficult to decide. We over think the decision  and never actually make a  choice. When we are forced to decide we always feel that we could have done better and the choice we eventually made is sub par.

Every had to choose a toothpaste? The varieties of toothpaste have declined over the years, but Crest still has 39 varieties and Colgate has 32 varieties. I don’t know about you, but I do get overwhelmed when I see all those different types of toothpaste. Is there one in particular that would do a superior job of cleaning and protecting my teeth? I will never know because when I am faced with all those possibilities, two things happen.  The first is I get beleaguered with all the choices and to counteract this I default to what I always use. The second is that I get impatient, I don’t have the time or want to use my time to examine which toothpaste is really the best, so I stick to what I know.

With everyday items when faced with too many choices we have a tendency to  default to what we know. This may or may not be the right the decision, but it is a decision and it is one we feel comfortable with.  However, when it comes to making life impacting decisions we don’t have a default to refer to, the default becomes doing nothing. This can have negative implications for us.

The classic case is when trying to decide the best way to save and invest for the future. The financial industry does not make it easy for the average consumer to make a decision.  Stocks, bonds, treasury bills, long term, short term, high risk , fixed income, balance portfolio, etc. The consumer is inundated with so many  options and the smoke and mirror antics of most consultants and bankers, really do not help the situation. The usual outcome  is either  that the consumer hands over the decision making power over to someone else (the financial consultant or someone at the bank) or they do nothing because they feel they need more time to figure it out.

The repercussion of both actions are not good. In the first case, what your consultant or banker decides for you, will always be biased to be beneficial to them more than it is beneficial to you. In fairness to finance professionals this is a natural reaction in many scenarios when one person is acting on behalf of someone else. In the second case, you will be missing out on financial earnings that you could earn if you made a decision.

At this point we can all agree that sometimes, having too many choices can be crippling . Whether it be a choice of toothpaste  or  the  choice of financial investments, I propose that we keep things simple and approach it systematically.

To ensure that we are not paralyzed by having too many choices. Here is an easy systematic approach to deal with the problem:

  1. Figure out WHY you want what you want
  2. Go board (GB)- have one or two basic parameters for what you are trying to acquire. Don’t get bogged down with the details
  3. Repeat 2 until your choice is obvious

Let’s apply this process to our investment example.

WHY: I have to save for retirement. There are numerous options: stocks, bonds and real estate. In each category there are even more options. So the next step would be establish  two basic criteria for investing.

GB1:  The criteria may be as follows:  I am not very aggressive, but I do want some risk. Also, I don’t want to have to manage anything myself. These criteria eliminates real estate because you will have to be somewhat hands on. It eliminates government  bonds because you want to take some risk and it  eliminates very risky stocks and so we have narrowed  down the selection to medium risk stocks and corporate bonds.

GB2: Next criteria may be that we want to invest locally or in our region. This will narrow down the selection even more.

GB3: Then we determine which types of stocks and bonds to  invest in. Our preferences will be based on our lifestyle, our    economic status and our cultural background. These will  inform our decision as to which companies we want to invest in. At this stage you would have narrowed down the options significantly.

GB6: The final criteria may be to choose the companies which have had the best performance over the last ten years.

GB7: At this stage, our choice(s) becomes obvious.


If this is new to you, I suggest you test it out on an everyday situation. You can test it out when trying to decide what to have for dinner. Your why will be hunger and the criteria might be either location or type of cuisine. Your hunger level will determine which takes precedent, somewhere close if you’re starving. If you are starving the closest place will be the obvious decision. We don’t have to be paralyzed when faced with many choices, the key is to know why and what it is you want. Once you can establish this, it narrows down your options and you are better able to make a decision that really works for you.

The next time you have to choose among many alternatives, try this approach and drop me a line and let me know how it worked for you.

Dr. M

The Changing Face of Education


“Education is really aimed at helping students get to the point where they can learn on their own” Noam Chomsky. I agree. I believe the purpose of education is to make us think beyond what already exists, rather than consuming factors and details of things that have already happened. In our current paradigm, most of us believe that education is the first step towards happiness and financial success. However, someone forgot to tell this to Walt Disney, Richard Branson, Bill Gates and Steve Jobs. Some of the most notable men in history didn’t go to or never finished college. These examples give credence to Sir Ken Robinson’s argument that schools kill creativity. Robinson proposes that educations need to be changed the following three ways:
• There should be an individualisation of the education process
• Education should nurture curiosity and
• Education should have more emphasis on creativity and less on conformity and compliance with standardized testing


Children are “guided” by parents in what to study with the intention that the child will be educated enough to acquire a well-paying job. The trouble with that is that we only need so many doctors, engineers and lawyers, programmers and game designers. The jobs that are paying well today will not necessarily be the ones that pay well into the future. This is because by the time the child graduates there will be an oversupply of that skill set because all the other well-meaning parents have been doing the same thing.

Additionally, technology is changing the landscape of our society. In a last quarter of a century, we have changed how we operate as individuals, businesses and society. This change is ongoing and according to the experts we are just getting started. The internet of things (IoT) is what we are moving towards. The IoT is essentially a network of physical objects which have been embedded with connectivity which allows them to send and receive data. The internet of things, will further change the structure and function of society.


The IoT is already transforming how we deliver education. It is moving us away from a knowledge transfer model, where a teacher we have a predetermined goal in mind, to a more collaborative, self-directed model where students can develop the skills necessary to be successful in today’s economic and technological environment.

One of the first countries to make significant changes to their education system is Finland. Finland has outperformed North American and many other nations around in the field of education. It recently announced that it will be phasing out the “teaching by subject” to “teaching by topic”. Liisa Pohjolainen who is in charge of youth and adult education stated that “We really need a rethinking of education and a redesigning of our system, so it prepares our children for the future with the skills that are needed for today and tomorrow. There are schools that are teaching in the old fashioned way which was of benefit in the beginnings of the 1900s – but the needs are not the same and we need something fit for the 21st century.” The Finns are focusing on “joyful learning” where children learn to develop their creative thinking skills.

As an educator, it took me some time for me to adjust to the new paradigm. I have seen the firsthand how delivery methodologies greatly impact student performance. I was trained in the old system. Six years ago when I started teaching Corporate Finance, it was delivered old school style, with the accompany pomp! Students didn’t do very well. I am fortunate to be teaching at an amazing institute and I have learned a lot from my students. They have taught me how to teach them. I had to make the course, something relatable, collaborative and to some extent a bit self-directed. The proof, as they say is in the pudding. The pass rate for the course has gone up and the general level of understanding continues to improve year by year.

As a mother, I also tried teaching my children, under the old paradigm. I realize that there is sometimes a clash between my approach and what they do at school. As a result, like I did with my children what I did with my students; I take my cue from them. They are teaching me how to teach them. The ultimate purpose for me as an educator is to foster creative thinking whether it is my own children or my students.

While it is true that technology is changing the execution of pedagogy, the purpose of education still remains the same, it is to continuously make us think beyond where are. At the end of the day in our capitalist society, education is still the key that opens many doors for us and it is what is needed to prepare us with the skills necessary to earn a livelihood. It is (with the exception of a few) the basis for future financial success. However to be successful today requires more than knowing the facts, it requires thinking outside the box. Human creativity is the driving force for our economic evolution and we have to ensure that our children are guided to harness their creative power and be allowed to nurture their own geniuses. Perhaps as we continue to foster new technology and new teaching paradigms which foster more creativity and people like Bill Gates and Steve Jobs will be the norm rather than the exception.

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Dr. M

Watch out for the Sun, it might be burning more than your skin!


I was born on a tropical island and whenever I heard the phrase “Oh, what a lovely day” in a movie or in books I never really got it, because for me every day was lovely.  It was not until I moved to a temperate country that I really understood what a lovely day is!  Bright sunny and warm days are the quintessential lovely days. It makes us happier. The sun rays give us vitamin D and nourish our immune system, why won’t we be happy?  It’s wonderful to see the transition from winter to spring and finally summer. People keep getting happier and happier and it all explodes in July and August!

It is well known that when we are happier, we tend to spend more, our generosity for ourselves and others expand. It’s not just in our heads. There have been numerous studies since the early 1970s that found that as consumers’ moods become more positive, they spend more money. Specifically the recent academic studies which focus on sunlight, show that exposure to sunlight increases people’s mood and this in turn increases spending.

Summer is upon us and good cheer abounds.  Good weather means we are out more and we tend to consume more food and drink in the summer than other times of the year. We use more gas, we stay at more hotels, we have more pool parties, more cocktails, kids are either at camp or we take them on vacation and we do landscaping. There is a lot of spending going on. We have to be careful that all this good cheer is not burning a hole in our wallets. I don’t mean to be a kill joy, but I have to at least warn you that in all the hysteria of summer, please keep your cool when it comes to spending. You don’t have to necessarily suffer a financial burn after summer if you take a few precautionary steps. The best way to do this is to have a summer budget. Allocate money for all your summer activities and apportion it out on a weekly basis and or a daily basis especially if you are travelling a lot.

While we have to cease the day we also have to remember that at some point September will be back. As the colder months approach we tend to put a brake on spending as we sober up from the intoxication of summer. Some people straight off get depressed. Recent research has found an interesting correlation between the weather and financial crisis, specifically many of the financial crises happen in the Fall, when the weather is getting colder. As the weather gets colder people become less optimistic and they spend less and take less risk.

Before all the solar merriment begins, take a moment and plan your summer finances. Most importantly STICK WITH IT.  Don’t throw caution to the wind because you are having such a great time. You should have a great time but be financially conscious as well. Remember that some of the most enjoyable and meaningful things in life don’t cost money. Here are some ideas for you to consider:

  • Staycation – Instead of flying out to a foreign land, why not explore your city or a nearby city. Local resorts with friends can be just as much fun and less costly.
  • Use the car less, walk more, bike or use public transport. All these activities are better for your health and for the environment.
  • Take advantage of all the local festivals and activities in your area. Parks, libraries and other community partners usually have free movies, music and theater. Free movies under the summer sky with the kids can create some fabulous memories.  Bring along your own fun and nutritious snacks and you’ve got your health and budget covered.
  • Use cash and ditch the credit card over the summer. This will make it easier for you to stick to your budget. When the cash runs out, you stop spending! This is a great way to ensure that you stay on course with your weekly or daily budget.
  • If you have extra space in your house or basement, you may consider renting it out for the summer. Students and other staycationers may need lodging that you can provide. This is an excellent way to earn some extra cash that can fund our own summer extravaganza.
  • Making meaningful memories with your children. Play in the backyard, do craft, paint and draw. Have a dance party in your living room. Sit and talk, watch the clouds go by. Spending quality time with your kids doesn’t cost a dime, but it the return on that investment stays with them and you, for many years to come.


By all means ENJOY your summer, but do so in a way that you will not be financially stressed after summer is over.


Dr. M

Bringing the Giant to It’s Knees, You Have the Power


Little drops of water can erode an entire mountain without the mountain ever noticing.  Like dripping water, we too have the power to bring large corporations to their knees. We are not as helpless as we think.  In fact, businesses thrive because of us.  Just as we made them, we can break them.

There are two factors that we deal with on a daily basis. There is a causal relationship between the two. They are our health and wealth (money). From our daily aches and pains and sleepless nights, our health is always top most on our minds. If are not feeling well all aspects of our lives are impacted. It is why TV shows like Dr. Oz is so popular. People want tips and information on how to get on with making their lives healthier and better. The other issue on our mind is our money. We use it every day, whether we actually spend or not, everything has monetary value. Even if we bring our lunch to work, there is a cost attached to that, there is also the cost of actually getting to work in the form  a gas bill or a bus/train fare etc. Health and money are deeply intertwined and more often than not we trade one for the other.

Today I want to focus how our profit driven society is having a significant negative impact on our health.

Here is the situation, food is being genetically modified for various reasons, the two main ones are for crop protection and to allow for greater durability of the product itself. For these reasons genetically modified organism (GMO) products are cost effective. This means that the producers can offer them to the market at a lower price.  As prices fall, demand for these products increases. When demand increases these companies make a bucket full of cash.  This makes them produce more, sell more and make more money. Consumers benefit from spending less and getting more. Everybody seems to be better off, so it seems. Things get a little murky when we find that there is a strong a correlation between the use of GMO and disease rates especially in the US.

So let’s look at the facts. GMO was first introduced in 1990. The top five GMO producers are the United States (US), Brazil, Argentina, Canada and India. Note that the US is the supreme leader when it comes to GMO producers.


Interestingly, the US and Canada are the only two countries that do not require the labelling of GMO products. So consumers in these countries don’t have all the information to make an informed buying decision.


In addition to being the largest GMO producer in the world, the US also has the highest rate of obesity in the world.  As well as, researchers have also found a positive correlation between GMO and the rate of thyroid cancer in the US. In other words, since the introduction of GMO products, the incidence of thyroid cancer has dramatically increased. Coincidence? I think not.


Here is the kicker, however. The US also has a higher level of income inequality when compared to other developed countries. If the majority of your population falls in the lower income bracket and GMO foods are less expensive, then it stands to reason that those who are struggling to work and raise a family will consume these products because they cost less. The middle and upper class have the means to be able to make changes because they can afford to. However the impact of this group is not enough to effect real change because the masses are still supporting these companies.



The formula for change is simple, but not easy. We simply have to stop buying GMO products. Companies will respond faster to lagging demand than they will to lobbying and appealing to their humanity. You literally have to hit them when it hurts the most and that is their bottom line. Businesses will quickly innovate and change when their profits are at stake. Otherwise, the status quo will be maintained.

We literally have to put our money where our mouth is and speak to them in language they can understand- profits.  Just as slavery didn’t end for humanitarian reasons; it ended because it became uneconomic and unprofitable. So too, we will not see a change in the type of products being sold if they don’t become unprofitable. We as consumers have the power to do dictate what is to be produced and consumed.  If we continue to purchase these products we are adding to the bottom line and so there is no incentive for the company to change its ways. It’s basic economics, if there is no demand the company will have to change to meet the market conditions or go out of business.

You may have realized by now that spending and your health are all connected and it will require conscious effort to change established patterns of behaviour.  Even though we know that something is not good for us and we see that is causing us harm we sometimes continue along the same path. In a lot of cases we have been brandwashed into consumption. We have become addicted to the chemicals in these products  and on our bodies demand them.  It has created a viscous cycle that can only be broken if we are willing to make a conscious effort to change. Your life is not compartmentalized. Money affects every facet of your existence. Money is the reason why the GMO was implemented, it is the reason why it sells (cheaper and lasts longer) and it is money that will be the reason why GMOs are removed from our food. Recognized this and then where ever you can take action to change.

It is hard to lecture to families who simply can’t afford to buy organic and continue to spend on those products that do more harm than good.  We have to recognise, however, it might be costing you more in both terms of your health and finances. It is expensive to be sick!  It is not a matter of maybe we can do it. We HAVE to do this for our own sake. Here are some ideas of how we can start on our journey to topple the giants.

The power of intention is powerful, if you keep making conscious choices and keep heading in the right direction you will eventually pick up momentum. If each of us commits to this action we will effect change. It may not be tomorrow, but change will occur.  As I said before the process is simple, but it is not necessarily easy. It will take patience and discipline, but the reward would be a positive change to both your health and wealth.

What are you giving up today to have a better tomorrow?

Dr. M

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