20120704-165814.jpgIn the world of what to consume and when to consume it, the underlying catch-all is water. The financial equivalent is cash.

No doubt.

We all need a fairly constant amount every day.

Luckily for most people, it rains on payday, and then you collect it and ration it out until the next rainy day. And I guess we all try save up a little extra against unexpected droughts.

If we go without water for long enough, we get dehydrated. And if we can all agree on anything, it’s that the business of being illiquid is no fun – particularly as it’s not long before your desiccated husk is being dropped into a shallow pit, overseen by solemn vulture-like gentlemen dressed in black.

So, above all, there is water.

Then, there is food. Nearly all of it is cashwater-based; but this time, there are nutrients and such that enable growth.

And back in the financial supermarket, we could probably think of them as follows:

  • Protein
  • Carbohydrates
  • Fruit and Veg
  • Sweeties
  • Cleaning Agents
  • Stuff from the Deli counter
  • Non-perishables
  • Brandings of the above.


The building blocks for growth. The best sources of this is usually the meaty stuff: like stocks and shares. And the private equity route – which is free-range, home-grown and organic.

There are also more exotic cuts that fewer people eat – like Art and collectibles. Of course, those can go bad very quickly (think: offal), and are quite taste dependent; but if you get it right, they can be really rich sources of protein.


Some say that it’s an energy source – but I maintain that you should be careful about the type of carbs you’re eating, if you’re having them at all. Because they can make you fat and heavy and it’s not that easy to get rid of (even if the theory says otherwise). This, in my mind, is real estate. Residential property is bad carbohydrate. Commercial property is good carbohydrate. The first locks you in, the second keeps you mobile.

Location location location. It’s always a question of quantity and quality.

Other types of carbohydrate include cars and furniture and general life stuff.

Fruit and Veg (and all-Bran)

The fixed income instruments: bonds, call deposits, so on. They keep you regular. And as you get older, it becomes more and more important that you have more of the roughage to prevent haemorrhoids.


The sexy stuff: like derivatives (futures, options). Have too much of them and your teeth fall out. Or you end up in an American-type crisis situation. But they’re deliciously exciting and a couple of sweets are awesome. But handle with caution. You need to know what you’re doing. Or ask someone to buy it for you.

Cleaning Agents

These babies are derivatives that aren’t meant for general consumption, being synthetic and chemical and looking a lot like credit-default swaps. Which is not to say that they don’t give you a high – but there’s usually a crash afterwards.

Generally, they’re meant to be used by the cleaning professionals for lowering the risk of dis-ease in their positions – but those guys are properly at risk of being overcome by the heady fumes. I’d preach avoidance.

But I’m not really one to talk. Chemicals are just so wildly addictive.

Stuff from the Deli Counter

The pre-cooked food story. The Exchange-Traded Funds and Mutual Funds and Unit Trusts that have been prepared by experienced cooks and such.

These are usually a bit more expensive than preparing the food yourself**. On the other hand, if you’re just making for yourself, it can be a lot less expensive that buying all the ingredients yourself – especially as you usually have to buy a packet/bunch of everything, rather than just exactly what you need.

However, if you’re following a specific diet – it’s hard to find the pre-cooked meal that caters precisely to your requirements. The supermarkets try – but they tend to end up being quite generic.


The tinned goods look a lot like commodities. They last a really long time. Fresher can be better for the individual – they tend to be used more by mass-producers of food in their canteens. But sometimes, the right tin can be just what you need***.


When you look at anything, you also need to look at the reputation of the brand. In my mind, this is all about currency and issuer reputation. These are vital.

What’s the point of buying something that’s about to go off because they lied on the best before date?


The point is: so much of what you do financially should be about your diet objectives. Different types of asset have different risk profiles and achieve different returns.

Some diets are very very bad. Some are healthy. Some are healthy at particular points in your life cycle. Some are necessary when you’re sick. Some are specific to your lifestyle and beliefs.

So for the next few weeks, I’m going to do basic summaries of the different types of asset – how they work, what they’re good for, and what to look out for on the label.

And then we’ll start looking at different diets.

PS: apologies if I got carried away with the metaphor. Expect more of it, I’m afraid.


**Every cook needs a management and performance fee.

***Not sure about this last metaphor – I may amend at a later date.