People are always asking me where to put their money so I thought I would do a simple post about it. I should add this is simply my own opinion and you should really check with a financial advisor…………tongue firmly in cheek!

Let’s start with the obvious. There is no such thing as a risk free investment. Even sovereign bonds (those issued by governments) can turn into wallpaper….look at the US Treasury market now, the world’s safest place to park your cash. Ultimately it’s just an IOU, generally backed by commodities or in the case of the US by a fairly large military and lots of nuclear rockets.

Having got that out of the way the first question you need to ask yourself is why am I investing? Is it for regular income or the hope of generating a huge pile of cash for future income generation (retirement for example).

Let’s start with the income piece by looking at what is available:

- Cash deposits.

- Term deposits.

- Government bonds.

- Corporate bonds.

- Shares that pay dividends.

- Property.

Generally, as in all things, you pay for what you get. The main issue any investor should consider before making an investment is liquidity:

How quickly can I get my cash and what will I have to pay to get it?

As many investors found to their cost in recent years, liquidity is the single most important issue.

Which draws the question: is there a market for my investment?

In the case of cash that is not a problem (actually that’s not true but for the sake of this exercise we will pretend that cash is always available – see Northern Rock for further details).

Stocks can generally be sold on the spot and cash received quickly (of course stocks can be suspended at anytime which means you can’t trade it, well not on the exchange).

Bonds have a market you can trade on but liquidity can be an issue sometimes.

Property you can forget. That’s a highly illiquid asset.

Managed funds as we see all to often can be very hard to get out of and the fees can be severe. If the fund holds any kind of assets other than plain stocks then redemptions may force suspension of the fund (we’ve seen that).

Baring all that in mind cash seems like the best place to have your money if access is an issue and you are risk averse. Second up would be quoted shares with high liquidity (shares on the major index e.g. Telecom in NZ which pays a good dividend). Bonds would be next and then managed funds and property bringing up the rear.

Anything that offers these with a twist is to be avoided unless you’re a professional. Like guaranteed capital return plus 100% of the 5 year blah blah return on some index. Avoid. There are huge fees and margins built into what is a simple option structure.

I’m sorry but there’s no free lunch in the investment world. But it’s very easy to lose money or receive poor returns whilst paying out large fees and charges.

My advice is start with cash and spend some time learning about basic stocks and bonds. Believe me it is not difficult.

Armed with a little knowledge most people could construct a portfolio of cash, stocks and bonds in a few hours.

Also don’t be lulled into the idea that you are a long term investor and won’t be pulling down the cash for 20-30 years. Look at how fast the world is changing…….planning that far ahead may not actually make much sense.

As with most things in life, keeping it simple can pay off. Also spending a little time learning about investment can save you a lot of money as well as enabling yourself to take charge of your own financial destiny.

Listening to Barack Obama tonight brought tears to the eyes.

Politics has long been missing the simplicity of both hope and intention. Sure it’s easy to sell change but I was left with the impression that he realises that the job is just starting and that everyone must pull together.

John McCain too made a speech full of integrity and dignity. What a lesson they both provided for our politicians in New Zealand who noticeably changed their demeanours in tonights final debate.

Could this be the remaking of the US? That’s hard to say but the reaction around the globe will be ecstatic, knowing we can move on from 8 ridiculous years. Watching Obama take Florida so easily just reinforces the injustice of Gore’s loss.

The Lord, however, moves in mysterious ways. Gore may not have been that great a President. Obama may have never been elected. In a way Bush laid the path for Obama. So destitute of ideas and principles the country, nay the world, was holding out for a hero.

Tonight Obama looked like a man who knows he is in for the long haul.

Let’s hope he can take the US in a new direction and build bridges to the world instead of blowing them up.

And with that in mind here’s something to mellow out with on a very special evening.

For those who haven’t read it yet here is link to the complete report on the future of search. It’s an eye opening read and hopefully will give rise to new ideas, new research and even new businesses.

For me it is the democratic nature of the web that excites me. For now i’ve just focused on the delivery of the architecture that will make us form the web around us rather than having to shop through designated ports.

I think that is well on the way to happening.

I’m also thinking about the impact on governance. By this i mean the way we allow ourselves to be governed: our electoral processes, our engagement and involvement in political systems and how we make ourselves heard.

The coming versions of the web will not just make business more efficient, or general life but our political systems, our governments who eat up 30-50% of our GDP depending where you live.

The ultimate political feedback and citizen engagement system is going to rise up from the web. The powers that be are not likely to embrace this as many of them will be out of a job.

E-government is a web 1.0 framework. Imagine what it could look like in future versions. Maybe we can set up a  dream team for that?

We are starting to see some revelatory musings on how search is going to develop going forward. This series is well worth reading for anyone who is interested in how the web is going to develop.

Thanks to Kaila i’ve been considering the future of search in 2010 or more to the point the future of search itself.

It didn’t take me long to realise that search is going to replaced by receive. How annoying is that to all those businesses involved in SEO

But seriously if we are still searching in 2010 i will be surprised because by then the web should be evolving into a living and breathing system. This system will not be a library which we dip into hoping that we will find what we are looking for but will be part of us.

Simply put we will become the system.

We won’t need to search anymore as we will be the filter through which information, that we both want and may be interested in, will flow.

Search is an external process: Receive is an internal process.

Relevance technologies will be key to this evolution as will as filtering systems. Receive will be an intelligent learning system. I’m looking forward to this.

Which is the best receive engine?…..that will be the question.

I’ve been following the Murdoch bid for Dow Jones courtesy of Jason and it’s actually more interesting than it looks on paper.

What is the future for print? Murdoch seems to be thinking that at some point the major papers will shut down. I agree with this though the time frame in uncertain.

This article confirms that the squeeze is on(thanks Jason!) noting that the San Francisco Chronicle is taking a major bath and should be shut down. Much of this is driven by falling advertising revenue but i think there is something else at work here.

People are generally using the internet for news and general media information. Who wants the hassle of buying a paper of which you may only read 20% of the content.

Murdoch senses something more economic. The costs of running a print media are enormous and the savings he could make by putting the Wall Street Journal online could be hefty. No distribution or printing costs. Imagine all the trees that could be saved

But think out further. Why do we read a newspaper? to get news, find out stuff, see what’s on etc.

Do we read it for editorial? Not anymore. Who cares what some editor thinks when there’s a million blogs all talking about the same thing. The blogosphere may be a holy mess but over time it will sort itself out into various structures and frameworks. Over at VortexDNA we have MyBlogDNA which will be rolling out soon where you can match your blog to others who share your DNA.

We are all editors now!

But imagine if you had the ability to create your own “paper” drawing from the net stories that you were interested in and were relevant to you. So order your subjects and away you go.

But you still want to hold something to read. Ok just print it off at home. With the printer technology we have now and no doubt coming soon, home printers will be able to handle a myriad of tasks. Have your own paper delivered and printed at home.

Now that will save a lot of money and energy too. No more wasted papers, sections of papers or rubbish i don’t want to read about.

Relevant advertising can come with it or without it.

Could this extend to magazines as well? Glossy Vogues printed out at home? Maybe that is a stretch too far but who knows?

What is for sure is that Murdoch seems to be ahead of the game here as he was with MySpace. I wonder how far ahead he has really thought.

Thoughts anyone?