To my fellow board members: request for comments

[Adam]

In my opinion Dan is one of the most mature people I know...I mean Dan you must have patience well beyond your years! I wish as much luck as humanly possible!Good luck I hope your sacrifices come to fruition!

all the best
Adam

P.s If I fly over would you let ride in your Maclaren hehee
that makes two maclaren rides!

[IvanDias]

Dan,

Why so drastic a reduction?

Sorry if I have the wrong end of the stick, but here goes...

You have "8 digit" assets.
Eight? So thats a minimum of $10,000,000 then.

err.. if you want to break 9 digits, a minimum of $100,000,000, and to get this you are expecting 20-25x return on investment, then you only need $5 million ($100,000,000 divided by x20 expected return)

Now as you have eight digit assets, (this is a minimum of $10 million as we said before), then according to your deal, at "only" x20 return then you will get $200 million back. At x25 then thats a cool quarter of a billion dollars.



Now, to the point.

If you have a minimum of $10 million to invest in your plan, then why not only invest 8 or 9 ???

8 x 20 = $160 million against the $200 you *could* have got by use all 10 mill.

2 million kept back to restart yourself if the devil thwarts the plan!!

$40 million "lost" when you have $162 million in the bank (8x20+2) is irrelevant to a lifestyle, as the bulk of the 162 could be invested around the world (bonds, trusts etc) 100% safe with a return that would always keep you in a good life with no capital errosion.

(mmm... never thought I`d ever use the words "40 million dollars and "is irrelevant" in the same sentance as just $30,000 dollars would pay all my debts and change my life beyond compare....and I`d pay it back, bear me in mind !!)


I do not see any real reason why the M5 (or any one car you want to keep) should go, nor that your lifestyle should have to come down to the level that you indicate.

Also, I have assumed that your eight digits is the minimum possible value of 10 mill, you could have 20 or 30 or 40 +, in which case the argument is even more silly.




Having been a member of this site since July, I see you as a respected and valued person, whose advice and opinion is worth something.

I have not commented of the whys and whats of investing everything in a plan that yields frankly astonishing returns with apparently no risk, because you must know what you are doing if you are the person I think you are.

Would you do us all a service, by telling us after you are done, what the plan was?

Although the cat would be out of the bag long before you are finished and there would probably not be much potential left for others to follow (always the case in financial niches), I must admit I would be fascinated to find out at a later date, what was the chink that you exploited to do what you are going to do.




Ivan.



PS. Private message me with an address to start mailing those hi-res BMW pics to you, and tell me how much of the 50mb+ you can accept per day or tell me a time to send them. Ta.

[MEnthusiast]

Dan,
My 2 cents are that I agree with everyone, especially Max.

If you feel a little uncomfortable driving what you do, given your age- you could just hold on to the M5- it is pretty well understated or you could go out and get a M3 or even perhaps a WRX. I think youd kick yourself in the rear if you drove the toyota. Get something thats a good daily driver, but thats fun. Maybe a C32 Benz? (I cant believe I just recommended a MB!)

I dont know what you will do after college, but if you pull up to an interview/ client in a 360 modena/spider they will definately form an opinion of you.

I want to strongly echo Max's comments on investing. Anything that has the ability to skyrocket upward also has the ability to crash. The go-go times we just had were times that it seemed everything and anything would fly. Now it seems we are at the other end of spectrum. There is a lot of negativity out there. Im not an investment guru or anything- but just check out where the Dow Jones IA is today and where it was about 5 days ago. Every time it gets some momentum it seems to sell off. While this is very simplistic- I think its basically because you have legions of investors who want to get out.

If you do sell the cars and make a bundle of money- I would urge you to examine your investments and look at the mix you have. Even at your relatively young age- owning a nice chunk in tax free bonds might make sense- and it would certainly give you a "sleep at night" ability. You will have to be careful because interest rates are historically low right now- so maybe you wait and during that time you literally put the money into commercial paper or short term cds or something more liquid than the bonds. My point is- youre 20 now. You will be 25 before you know it and at some point you might find other things in your life (like a nice Mrs. Fett and maybe some little Fetts to give those rebels a hard time ) so planning in stability is a great idea. When the economy sinks youll sleep at night and when the economy gets over-excited you can pick your spots to participate.

Good luck and let us know how it goes.

Finally you could donate that Ferrari to the MEnthusiast charity- we normally dont take Ferraris, but we would make an exception for such an esteemed bounty hunter. And you get the tax break!

[Adam]

Ivan thank you for putting everything into perspective..did you like get an A* for GCSE maths?

all the best
Adam

[basil]

Dan,

If you whittle down to one car, then considering how we drive I would get a solid car that could better withstand crash impact than a Toyota, etc. It would be awful to lose ones good health because of a substandard cage when one could easily afford a better technology. Oh yeah, no sense in getting a slouch either.

Soapbox: Btw, if people followed the rules of the road - well just one rule even- LOOK Idiot!, then speed might be considered less of a danger by the DMV. Interested in others thoughts on that. Too bad we can't get points given for cleaning up the gene pool.

[MAVERICK]

Some good advice from the others, Dan. I don't have any experience with investments. I'll only say three things as a layman and as a student:

1) Please be very careful! If I were you and let's say the net worth was $10 million, I'd only invest $5 million in a get-filthy-rich-in-a-short-time scheme. This way, if the deal collapsed, I'd be very happy that I still had 50% of my money left instead of only 10%. Losing 90% of your assests can be sobering especially when one is so young and has never had the experience of things going wrong in life. However, you are only 20, and even if you lost most of it, you still have your life ahead of you to make up for it and to learn from from your mistakes. As Ivan said, by only investing 5 million, you should have a cool $100 million. Why risk 90% of your money just to get $200 million when 100 million is more than sufficient to buy 10 McLaren F1's and still have plenty of pocket money. Here's a proverb I found:

"Money doesn't always bring happiness. People with ten
million dollars are no happier than people with nine million
dollars."
Hobart Brown

2) If you have owned an M5 for a couple of years and are soon taking delivery of a 360, you definitely do not seem to suffer from guilt about being so young and owning these cars. You may feel a little guilty but not so much that it stopped you from purchasing these fine cars. Don't get me wrong. I would feel the same way as you and I, too, would not have hesitated in buying the M5. In fact, the real reason you are willing to part with these cars for a short while and curtail your living expenses is so that you can make $200 million instead of $100 million. If you go through with this deal, I see no reason why you should be like the rest of us college students and drive Corolla's, Civic's and old beaters. Remember that a slightly dirty jet black, de-badged M5 is so stealthy, you could go about college-life without attracting unwanted attention. It's not worth compromising your life and safety by going from an M5 down to a tin-can Corolla, especially the fast way you drive. Don't feel guilty about not being like the rest of us, students. By work, smart thinking, and a good deal of luck you earned your money and I'm glad you seized the day and bought the beast and the Ferrari. Life is short. I am always happy to see a student with a nice car. Seeing a fellow student with an M5 is fantastic as long as he keeps does not flaunt it around others and invite trouble.

3) No matter what happens, whether you own an M5 or a Corolla, as long as you are a car-enthusiast you'll always be a valuable and welcome member at this board. I could not care less whether you have $100 or $100,000,000 in the bank, you are part of our M5 family, Dan.

Good Luck with your decision,
Peter

[PaulMarin]

Dan, fist of all, I wish you contiued good luck. Now my perspective: the M5 is the least expensive, least head turning, most practical of all the cars you listed. Taking into consideration your apparent station in life, regardless of your age, and how far back you've scaled your (outrageous) near future automobile collection, everyday driving an M5 seems moderate, prudent, relatively modest and completely practical. To get some of that feeling of "suffering" you are looking for, leave the M5 bone stock, no modificatios whatsoever. Now that we've solved that, what color is your new M5?

[TCM]

Dan:

I am also 20 and a student. I am no financial expert, but I would really consider setting up a retirement plan, college funds for your future kids, etc. With a low risk investment, these would be worth a lot by the time you use them and can provide a nice fall back in case something awful happens with your other investments.

As for your cars, screw what other people think. You made your own luck by working hard and using your head. But your stable seems to be a bit crowded for you. I personally would get the M5 and 360 Spider. No Astons, or Diablos, or McLarens yet. Ferrari drop tops hold their value very well if well maintained. I do not think you will get too much flak(sp) from driving a M5. Most kids do not know the difference between a M5 and a 528. The ones who do will not pick on you, but try to become your best freinds . Keep the Ferrari for the weekends and have fun with it. You deserve it. You may want to consider getting all of the above mentioned cars and then selling them like you said. This sounds like a good plan but it could backfire on you, leaving you with a bunch of beautiful metal sculptures that will lose value every day. You want a safe car, no Toyota 4 banger. Keep the M5, it is safe, practical, and very stealth. A Ferrari is not a decsion you make with your head nor money. It is a investment that you make with your heart and ears. Keep the 360. Maybe you should get a fun beater car also. A WRX, or M Coupe maybe? You could pound on these and track them with out worrying about every waking second on a track. Good luck with your decisions. I am sure you will make the right move for you.

[greg]

I echo most of the sentiments above. Let me reiterate and add my 2 cents:

1) There are no sure investments with that kind of return. Period.

2) If I had (to pick the number used above) $10M, I would realize that I have my life set. I can have, say, $300K a year cash flow without working, and still have long term investments - without risking it all. My advice - take the money off the table. secure your life. Invest the rest, but DIVERSIFICATION is the watchword.

3) If I had (to pick the number used above) $10M, I would consider putting $2.5M into cars as a very unwise decision. If I had $100M, I would not.

4) The $$ of a nice car to drive around - OK, maybe not a McLaren - but any ONE of the others - is peanuts compared to the total you were thinking about. It doesn't have to be binary. Pick a nice car, buy it and drive it. Invest the rest. You don't have to live a life of total deprivation.

An important advantage of being your age is that you can afford to put your money in much LESS risky investments - and STILL be set for life. Yet you seem bent on making a huge killing. Why? have you ever done the math to see what it takes to say, have some nice cars, a couple of homes, college educ ation for your (future) kids, nice baubles for your wife? If you hav en't - you should. Because you are already there - or close to it. I wouldn't throw that away on cars OR any single investment in the world.

[Gustav]

I think you can say this also in some cases:

"Money doesn't always bring happiness. People with ten
million dollars are not nessecarily happier than people with nine dollars."

Gustav