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We are excited to announce our latest integration with Stripe, a global leader in payment processing, to further enhance the security, reliability, and ease of transactions on ArenaInvestor.com. This partnership is a key addition to our tech stack, ensuring that every transaction our clients make is handled with the highest standards of security and efficiency.

Why Stripe?

Stripe is renowned for its industry-leading payment solutions, offering secure and seamless transaction processing for businesses around the world. With a reputation for innovation and reliability, Stripe is trusted by millions of companies to handle their financial transactions securely and efficiently. By integrating Stripe into Arena Investor’s platform, we are providing our clients with a trusted and modern payment experience that aligns perfectly with our commitment to delivering cutting-edge financial services.

Secure and Seamless Transactions

The integration of Stripe into Arena Investor’s tech-stack means that all transactions you make—whether purchasing Financial Planning services, Financial Health Monitoring & Alerts services, Portfolio Checkup services, or receiving any necessary refunds—are processed with the utmost security. Stripe’s advanced fraud prevention tools, encryption protocols, and secure payment methods ensure that your financial information is always protected. This partnership allows us to offer you a seamless, hassle-free experience when managing your investments or making payments through our platform.

Trusted by Millions, Now at Arena Investor

Stripe’s technology is trusted by some of the largest companies in the world, and we are proud to bring that same level of trust to our clients at Arena Investor. Whether you’re a new client or a long-time client, you can now enjoy the peace of mind that comes with using a secure, globally recognized payment processor. The buying experience on ArenaInvestor.com is now more streamlined than ever, making it easier for you to focus on what truly matters—your financial growth and success.

A Modern Advisory Experience

At Arena Investor, we believe that a modern advisory should be built on a foundation of technology that people know, love, and trust. The integration of Stripe into our platform is a reflection of this belief. We are committed to using the best tools available to create an experience that is efficient and secure. With Stripe, we are not only enhancing the quality of our services but also ensuring that our clients have access to the most reliable and modern financial tools available.

Looking Ahead

We are thrilled about the benefits this partnership with Stripe will bring to our clients and are excited to continue innovating and improving the services we offer. As always, our goal is to provide you with the best possible experience, and we believe that this integration is a significant step in that direction.

Thank you for trusting Arena Investor with your financial needs. If you have any questions about how Stripe will enhance your experience, please don’t hesitate to reach out to us.

Truly,
The Arena Investor Team

Built for The One in the Arena

Arena Investor is on a mission not only to help with financial planning, and investment management, but also with education. Keep reading, watching, following, and sharing great Arena Investor content. And as always if you want professional advice, we are glad to be your teammate – along a financial journey you can actually enjoy.

You’re the Hero.
    We’re the Guide.

In personal finance, the term "Burn Rate" may not be as commonly discussed as budgets or savings, but it’s equally crucial. Especially suited for individuals looking to get a grasp on their financial health and spending efficiency, understanding your Burn Rate provides essential insights. This guide, designed for beginners and enhanced with expertise from Arena Investor Advisors, simplifies the concept of Burn Rate and illustrates how it can be a pivotal tool in managing your finances.

What is Burn Rate?

Burn Rate in personal finance measures the ratio of your estimated annual spending (excluding debt payments) to your total annual income. This metric helps you understand what percentage of your income is consumed by regular expenses, helping gauge how efficiently you are using your financial resources. Essentially, it's an indicator of how quickly you’re "burning through" your income on non-debt expenses each year.

Importance of Understanding Your Burn Rate

1. Efficiency in Spending: Knowing your Burn Rate helps identify how much of your income is going towards everyday expenses. A lower Burn Rate means more of your income is either being saved or invested, which is crucial for financial growth and stability.

2. Financial Planning and Budgeting: By understanding your Burn Rate, you can make informed decisions about where adjustments may be needed in your spending habits or income streams to improve financial health.

3  Preparing for the Future: Managing your Burn Rate effectively ensures that you are saving enough to meet future financial goals, whether it's buying a home, investing in education, or planning for retirement.

How to Calculate Burn Rate

To calculate your Burn Rate, subtract any debt payments from your total estimated annual spending, then divide this number by your total annual income. Multiply the result by 100 to get a percentage. For example, if your annual spending (minus debt payments) is $40,000 and your total annual income is $100,000, your Burn Rate is 40%. This means 40% of your income is used for regular expenses, excluding debt repayment.

How an Arena Investor Advisor Can Help

1. Personalized Analysis: An Arena Investor Advisor starts with a detailed assessment of your income and expenditures to calculate your Burn Rate accurately. This analysis serves as the foundation for personalized financial advice.

2. Strategic Budgeting: Depending on your Burn Rate, your Arena Investor Advisor might suggest strategies to optimize it. This could involve advice on reducing unnecessary expenditures, increasing income, or reallocating funds more efficiently between saving, spending, and investing.

3. Regular Updates and Financial Adjustments: Financial situations can evolve, so regular monitoring of your Burn Rate is essential. An Arena Investor Advisor will help keep your financial strategies aligned with changes in your income or spending patterns.

4. Educational Support and Guidance: For newcomers to financial management, comprehending and applying financial metrics like Burn Rate can be daunting. Arena Investor Advisors ensure you understand each element of your financial plan, empowering you with the knowledge to make sound decisions.

5. Technology Integration: Using advanced tools, industry-leading apps and platforms, your Arena Investor Advisor can visualize your financial data for you, so it’s easier to see, understand, and act upon. These tools help clarify how changes in your Burn Rate affect your overall financial health.

All In All

Understanding and managing your Burn Rate is essential for effective financial planning and maintaining economic stability. With the guidance of an Arena Investor Advisor, you can ensure that your spending is efficient, and your savings and investment strategies are on track to meet your financial goals. By monitoring and adjusting your Burn Rate regularly, you can achieve a balanced financial lifestyle that not only meets current needs but also secures your future.

Working with Arena Investor provides you with the expertise and tools necessary to navigate your financial journey with confidence, ensuring that every decision moves you closer to your long-term financial aspirations.

Built for The One in the Arena

Arena Investor is on a mission not only to help with financial planning, and investment management, but also with education. Keep reading, watching, following, and sharing great Arena Investor content. And as always if you want professional advice, we are glad to be your teammate – along a financial journey you can actually enjoy.

You’re the Hero.
    We’re the Guide.

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Note: Economics is the study of how society uses resources for the development, production, procurement, distribution, and consumption of tangible products (such as iPhones) and intangible services (such as Apple Music).

John Maynard Keynes

The most important name in today’s worldwide economic system is John Maynard Keynes. Keynes is the one who developed economics as we know it. He wrote “The General Theory of Employment Interest and Money” in 1936 in the UK. Similar to Copernicus seeking to understand the movement of the Sun, planets, and stars, Keynes wanted to understand unemployment because The Great Depression was such a problem in the 1930s, and the existing understanding of economics did not explain what was happening (or what could be done about it) very well enough for governments to partake in righting the economic ship during the storm.

Note: Come back later for more articles about other economists across the ages, such as The Austrian School of economics (also very significant).

Keynes wanted to understand

He wanted to know what existing economics at the time could not explain about The Great Depression – but he did so with an emphasis on unemployment and by taking snapshots of the economy, as if it was static. So what he developed is useful, but lacks usefulness on growth or inflation issues.

More specifically, Keynes wanted to understand how employment and prices affect each other; how government affected employment and prices; and more than anything, he wanted to know how to “control” (or at least influence economies/money), such as how to drive employment up. 

More or less, Keynes used existing approaches that microeconomists used when evaluating businesses, plus some new approaches to expand economic knowledge into something bigger: macroeconomics

Simply put, Keynes took what was small or local and made it big – big enough for governments to use. Naturally, macroeconomics includes microeconomics since the economy of each piece would be part of the economy of the whole.

Milton Friedman came later

He pointed out that Keynesian Economics could not explain the relationship between price levels and economic output. He called this “the missing equation.” Friedman melded classical economics understandings of Adam Smith (and others) with Keynesian Economics. Friedman concluded that the classic theories worked in the long-run, but Keynesian Economics works in short intervals.

Local isn’t universal

“What goes up must come down” is right locally (in your backyard), but on a bigger scale it is wrong . The meteorites from space that have landed on Earth did not come back down to their origin when they “went up.” They never came back down.

Building on Friedman’s work

An economist from New Zealand began working with 100 years of UK data on the relationship between unemployment and inflation. The economist’s name was AW Phillips, and his work became known as The Phillips Curve. This curve was adopted by economists worldwide and is now a major contributor to economics. It shows that as unemployment rises, wages increase, and when unemployment falls, wages decrease.

Friedman and fellow economist Edmund Phelps felt that manipulating monetary policy (such as managing inflation) was not the right way to manage unemployment and that unemployment should be left “natural” and unaltered by central banks, the banks of governments.

Then in the 1970s and 1980s the US experienced both high unemployment and high inflation. Phelps and Friedman then clarified the understanding to show that The Phillips Curve was true if inflation was unanticipated. If it was anticipated, then the conditions were different. This ushered in a whole new element to economics: Expectations are part of the equation in a significant way.

Nowadays, we see expectations set by world governments very deliberately so they can use it as another way to manage economic systems. Something like “a period of somewhat-higher inflation can be expected in the next two quarters,” is common to hear from a Fed Chairman (Federal Reserve Chairman) since this economic understanding came to be.

Of note, since the late 80s/early 90s, economic growth theory is what has dominated economist efforts (since inflation, employment, and prices were already being managed with Keynesian and Friedman understanding), and GDP expansion continued as a top priority.

Back to The Great Depression

Let’s not forget how the interest and need for macroeconomics got started: The Great Depression. The Great Depression was not just in the US. It was global. It started in the US in 1929 though, and by 1930 it had reached the UK. Half of Britain’s trade (sales around the world) disappeared, and in some areas unemployment reached 70%! No wonder efforts were made to understand economics better.

The US had an awful time through The Great Depression too of course, as did countless other countries. For the US, The Great Depression did not end until we entered WWII in 1941. The statistics and the stories are really sad, and to this day people and governments study, fear, and work to avoid the conditions that led to The Great Depression.

Note: The Industrial Revolution followed by The Great Depression followed by WWII followed by The Cold War firmly cemented Keynesian Economics into world governments for a variety of reasons.

Boom and bust

Economic booms (a hot economy) and busts (a cold economy) are now known as business cycles. You may think that you always want your economy hot, but that is actually not true. Booms can lead to bubbles and bubbles pop and you get busts. Understanding business cycles is just one piece of the economy. Another piece of the economy is understanding growth.

Note: As investors, if we understand where things have been we can better understand where things are going — and that’s a major strategic advantage.

Let’s talk about GDP

When you add up all of the goods (such as iPhones) and services (such as Apple Music) you get GDP (Gross Domestic Product). GDP is measured as Total County Production measured in dollars (if you’re the US). GDP has been growing for 200 years for capitalist countries.

Note: there is no purely capitalist country, but each country has rules and people that are more capitalistic than others.

GDP across decades has a very obvious upward trend

But GDP throughout the weeks, months, quarters, and a year can (and do) have significant ups and downs. It is within these ups and downs that successful investors thrive and profit.

Let’s talk about inflation too

The last concept to introduce in this article is inflation. For most people the word has nothing but negative connotations. But in the world of Keynesian economics inflation is a given, and it's managed with government actions. 

Simply put: inflation is a rise in prices. 

Often people think inflation is simply a devaluing of currency by printing too much currency, but consider this: if currency was devalued then prices would go up, no? They would. So devaluing currency is a type/cause of inflation, but there are other types/causes too.

It’s right to monitor and take appropriate action against inflation

When prices go up enormous amounts this is called hyperinflation. For instance, between WWI and WWII Germany had inflation of 230% per month at times! That means every day prices went up 4% on average. So if milk cost $1 on Monday, it cost $1.04 on Tuesday, $1.08 on Wednesday, $1.12 on Thursday, and $1.17 on Friday. By the end of the month milk would cost $2.30. By the end of the year milk would cost $8.20. And a $25,000 car would cost $180,020.60 if those hyperinflation rates happened to us today. No wonder it scares people.

Historically, the US has managed inflation well

In the last 100 years, our worst experience had been in the 1970s when inflation reached 7% from 1973-1975. However, in 2022 inflation met or exceeded 7.5%. 

The US government used many tools and decision-makers to keep it down and return to the 3-4% average we have had since 1946 (on the heels of WWII). Before WWII, the US averaged about 1.7% inflation.

Around the world though, countries have been far more adversely affected by inflation. As mentioned, Germany experienced 230% inflation per year. Israel saw 400% inflation in 1985; Argentina has seen 700% inflation; Bolivia saw 12,500% in 1984. There are many more examples, but Keynesian economics does indeed have the understanding, tools, and systems that manage inflation well.

Inflation is like cancer to economies — and it must be detected early and expertly managed. When inflation is detected, it gets everyone’s attention!

So that’s the introduction to economics. There is a lot more to follow, but we hope you liked what you read, and we hope you have learned something too. Is this enough understanding for you to go start investing in stocks with great success? No. But we can build to that.

The key concepts in this article to remember are:

• John Maynard Keynes “invented” macroeconomics for governments
• Government using macroeconomics to influence and manage a country’s economy
• Milton Friedman identified the relationship between prices and economic output
• AW Phillips identified the relationship between Unemployment and inflation, known as The Phillips Curve
• Phelps-Friedman established expectations as a key component of an economy
• Business cycles, GDP, and inflation as the major factors government considers
• Since the late 80s/90s, economic growth has become the priority for economists

Built for The One in the Arena

Arena Investor is on a mission not only to help with financial planning, and investment management, but also with education. Keep reading, watching, following, and sharing great Arena Investor content. And as always if you want professional advice, we are glad to be your teammate – along a financial journey you can actually enjoy.

You’re the Hero.
    We’re the Guide.

‍