Book Summary: How to Make a Fortune From the Biggest Bailout in US History - By Ron Insana

Ron Insana is a CNBC analysts and author. This book is a guide to the 7 Greatest Bargains from Main Street to Wall Street. This book was written in 2009 and some of these deals may have changed. Regardless, the lessons outlined in this book are good for the individual investor.

Why is this important to me?

This is important because we can learn from the top dogs and understand that when there is blood in the water, it is time to buy!

Investing in real-estate, stock market or any other vehicle should be just like grocery shopping. Think about it. Most people cut coupons and buy things on sale when they shop. They do this week in and week out. Savvy investors like Warren Buffett know that you make the money on the buy.

The reality of the situation is that 90% of the individual investors are mere sheep being slaughter by the wolves on Wall Street. Why is it that people sell when stocks go down and buy when they move up? Understanding the irrational brain and psychology of crowds is the answer or in plain English, you need to control your emotions.

Ron highlights several investment types that can be invested in as well as some good advice. For the sake of time, I will highlight three things.

1. Follow the pros - This piece of advice is worth the price of the book. Ron talks about Bill Gross (PIMCO), George Soros and Warren Buffett. All of these men know that when people are exiting, it is time to buy. It is hard to buy something when it is going down. The primitive brain goes into protection mode. The Great Depression yielded some of the largest riches in history. Savvy investors know the difference between price and Value.

2. Payback Time - When you buy things that are dropping in price and NOT value then you are securing great profit for the future. Think about this. You invest in a stock that is trading for $25 per share and is valued at $50. Good investors know how to do this. Now the market panics and you buy instead of sell. Look at this illustration:

Buy 1000 shares at $25

Buy 1000 shares at $18

Buy 1000 shares at $10

Assuming the fundamentals of the stock has not changed then if you sell at a 20% gain from your top price of $25 then you would sell at $30 per share. This may take 1 year or more to do but if you do this then your profit is $37,000 on a $53,000 investment. That is 70% gain. 3. Ron profiles several resources for you to make big money. RealityTrac is a foreclosure website. If you want to make cash flow rental income or fix and flip then this site is for you. If you want to simply emulate the big guys in the stock market then you can search for 13F's and know what Warren Buffett, Bill Gross and other value investors are buying.

The best way to make a fortune is to emulate people who have already done it. Ron's book is specific to the 2009 market but the lessons are stronger than that. I am writing this in August of 2011 and I can tell you that there is blood in the water again. Debts around the world are staggering and there will be great investment opportunities. Keep your eyes open and emulate the best.

I hope you have found this short summary useful. The key to any new idea is to work it into your daily routine until it becomes habit. Habits form in as little as 21 days. One thing you can take away from this book is emulate the best. Following the best in any field is a sure way to success. The good news is that you can do this with the internet and you don't even need to know the people you are emulating.

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