1. “New Learning” Barnard’s Inn Hall Holborn London EC1N 2HH Tel: +44 (0)20 7831-0575 Fax: +44 (0)20 7831-5208 Email : michael_mainelli@zyen.com www.gresham.ac.uk © Gresham College 2008 Mercers’ School Memorial Professor of Commerce Michael Mainelli How To Get Ahead In Commerce The Sure-Fire Ways To Make Money

2. www.gresham.ac.uk © Gresham College 2008 Outline “Get a detailed grip on the big picture.” Chao Kli Ning Wise guys A rich taxonomy Fortune favours the lucky Getting rich through failure Front-running bubble style Money machines Owning the casino

3. www.gresham.ac.uk © Gresham College 2008 How To Get Ahead In Commerce

4. www.gresham.ac.uk © Gresham College 2008 Sincerity Personified

5. www.gresham.ac.uk © Gresham College 2008 Sincerity Certified

6. www.gresham.ac.uk © Gresham College 2008 Ponzi Numbers Game 1 10 100 1,000 10,000 1,000,000 10,000,000 100,000,000 1,000,000,000 10,000,000,000

7. www.gresham.ac.uk © Gresham College 2008 Do You Sincerely Want To Be Rich?

8. www.gresham.ac.uk © Gresham College 2008 Get Rich Taxonomy Go ! Criminal frauds swindles Ponzi schemes pyramid schemes forgery & counterfeiting tax evasion embezzlement robbery & theft corruption price-fixing

9. www.gresham.ac.uk © Gresham College 2008 What You Know or Who You Know? Go ! Criminal Hard WorkSmart Work

10. www.gresham.ac.uk © Gresham College 2008 Successful Habits £780,043£155,832£49,960£24,769 Mean value for group £351,137£99,727£35,345£5,093 Entry level for group 42,000421,0004.21 Million 29.5 Million Number Top 0.1 % (or the "very,very rich) Top 1 % to 0.1% (adults) Top 10% to 1% (adults) All Taxpayers [Source: “Racing Away? Income Inequality And The Evolution Of High Incomes”, Institute for Fiscal Studies, IFS Briefing Note Number 76 (January 2008)

11. www.gresham.ac.uk © Gresham College 2008 Sunday Times 2007 UK Rich List 1 Lakshmi Mittal and family £19,250m - Steel 2 Roman Abramovich £10,800m - Oil and industry 3 The Duke of Westminster £7,000m - Property 4 Sri and Gopi Hinduja £6,200m - Industry and finance 5 David Khalili £5,800m - Art and property 6 Hans Rausing and family £5,400m - Packaging 7 Sir Philip and Lady Green £4,900m - Retailing 8 John Fredriksen £3,500m - Shipping 9 David and Simon Reuben £3,490m - Metals and property 10 Jim Ratcliffe £3,300m - Chemicals 11 Sir Richard Branson £3,100m - Transport and mobile phones 12= Charlene & Michel de Carvalho £3,050m – Inheritance 12= Sean Quinn and family £3,050m - Quarrying, property and insurance 14 Simon Halabi £3,000m - Property, health clubs 15 Kirsten and Jorn Rausing £2,825m - Inheritance and investments 16 Joe Lewis £2,800m - Foreign exchange, investments 17 Earl Cadogan and family £2,610m - Property 18 Nadhmi Auchi £2,575m - Finance, property and hotels 19 Vladimir Kim £2,261m - Mining 20 Bernie and Slavica Ecclestone £2,250m - Motor racing

12. www.gresham.ac.uk © Gresham College 2008 Fortune Favours The Lucky Go ! Criminal Luck inheritance sex lotteries gambling Hard WorkSmart Work

13. www.gresham.ac.uk © Gresham College 2008 Getting Rich Through Failure Go ! Criminal Luck Hard WorkSmart Work Scarcity & Competition Information Asymmetries ExternalitiesAgency Problems

14. www.gresham.ac.uk © Gresham College 2008 Barking Up The Right Tree “It’s a dogwood tree. I can tell from the bark.”

15. www.gresham.ac.uk © Gresham College 2008 Getting Rich Through Bubbles Go ! Criminal Luck Hard WorkSmart Work Scarcity & Competition Information Asymmetries ExternalitiesAgency Problems Front- Running

16. www.gresham.ac.uk © Gresham College 2008 Front-Running Bubble Style [William Hogarth, The South Sea Scheme, 1721]

17. www.gresham.ac.uk © Gresham College 2008 Getting Rich Through Magic Go ! Criminal Luck Hard WorkSmart Work Scarcity & Competition Information Asymmetries ExternalitiesAgency Problems Front- Running Money Machines

18. www.gresham.ac.uk © Gresham College 2008 Black Box Machines www.saltofthevalley.com Mark Bump

19. www.gresham.ac.uk © Gresham College 2008 Money Machines

20. www.gresham.ac.uk © Gresham College 2008 Get Rich Taxonomy Go ! Criminal Luck Hard WorkSmart Work Scarcity & Competition Information Asymmetries ExternalitiesAgency Problems Front- Running Money Machines

21. www.gresham.ac.uk © Gresham College 2008 Greed, Fear, and a Little Gas [Source: http://www.fortunewatch.com/handling-greed-and-fear-in-investing/]

22. www.gresham.ac.uk © Gresham College 2008 Discussion 1. When should we let third parties invest our money, ignoring tax advantages? 2. Do regulatory and professional safety costs genuinely offset caveat emptor, or just take our money?

23. www.gresham.ac.uk © Gresham College 2008 How To Get Ahead In Commerce: The Sure-Fire Ways To Make Money Thank you! “Get a big picture grip on the details.” Chao Kli Ning