Edited by Frederick Mann
Copyright © 1995 – 1997 TLH, ALL RIGHTS RESERVED


by Frederick Mann

Buckminster Fuller, famous inventor of the geodesic dome (and many other inventions), wrote that, given the number of humans on earth and the abundance of resources available to us, every man, woman, and child should be a millionaire many times over.

So why aren’t we all millionaires?

Thousands of books have been written by people who’ve made a great deal of money, and by authors who studied those who made the biggest fortunes. Every year, millions of people buy books and programs on how to get rich.

So why aren’t we all millionaires?

Some of us do succeed in becoming millionaires in a relatively short time. Most of us don’t. What’s the difference between those who succeed and those who don’t? The differences between success and failure may be relatively small. In order to become spectacularly successful and wealthy, you may have to make only minor changes and improvements in your thinking and attitudes, in how you spot and seize opportunities, in your money-making actions, in how you handle money, and in how you interact with those thieves who seek to separate you from your money.

This Special Report provides the guidelines for you to create a continuously-strengthening foundation on which to build your fortune. It contains some very important principles not available anywhere else. By applying these principles, you can make the minor changes and improvements necessary to become a millionaire – or a billionaire!


Copyright © 1995 by Nick Penn

Did you know that there is one and only one basic rule essential to grow wealth? Master this one point and you cannot help but grow wealthy, no matter what your situation. Fail to learn it, and the possibility of growing wealthy becomes 1 in 10,000,000.

Wait! Can this be true? Is there a rule so fundamental to accumulating wealth that it’s foolproof when followed? If so, how can it be this miracle revelation is not common knowledge? Why isn’t it taught in kindergarten? Why isn’t it engraved on the walls of every library? Why isn’t it shouted in the streets?!

Yes, there is such a rule, and once you hear it, and take time to weigh its meaning, it will seem obvious in retrospect. So, why isn’t it known? Perhaps it may be too simple and insignificant to be noted. On the other hand, it might be so elegant and powerful few can grasp it.

It certainly isn’t common wisdom. You never find it written as the leading premise of wealth. You never hear it discussed. You seldom hear even the wisest of men applying its consequences to their own life, or offering it as sound advice to those who request guidance. In fact, what passes for common wisdom teaches something quite different.

Does this seem too absurd to be true? Indeed it does. There must be some explanation. Could it be, that deep in human nature, there is something which causes humans to overlook this simple principle? Yes, surely this must be near the heart of the matter. Conventional wisdom must be based on some wrong idea. Maybe, an existing idea stands in the way of progress. I call this situation a manifestation of the “One Wrong Idea” at work.

Some other idea, or modality of human consciousness, must stand firmly in the way of progress, blotting out the meaning of the idea, as a storm cloud wipes out the sun.

The “One Wrong Idea”
Ah! Did you hear that? Did you catch the wrong idea you were just given? Or did that sentence pass you by unnoticed? Did it pass for truth? The last phrase of the last paragraph was chosen to illustrate the point. The “One Wrong Idea” often permeates our thinking and fully colors our perception of reality. Unfortunately, when this happens, we think about a “reality” which is unreal. How can we be effective in reality, then? We are acting according to ideas based on unreal assumptions.

Can a storm cloud wipe out the sun? Stretched to the most poetic, metaphoric sense, this idea only approximates reality. A quite different “reality” than actually exists.

(This example of the “One Wrong Idea” in-situ here is a convenient place to begin our examination. It’s a worthy divergence, for in it we will see how to wake our consciousness. Thereby we may be readied for the Most Basic Wealth Principle to come later in this presentation. We’ll take a moment and realize how well-entrenched certain wrong ideas can become.)

A particular wrong idea, which I will identify shortly, is thousands of years old. Further, it has been known to be wrong for approximately 400 years. On top of that, during the day of its rule, it greatly limited humans from progressing. Humans were censored, even killed, for speaking the truth about it. Yet our language still reflects this persistent error.

Still today, how often do children and even adults observe clouds in the sky, and say, “The storm clouds covered the sun?” Or, “The sun isn’t out, today?” What is the reality of the situation they describe? It’s merely that a bit of water, evaporated by the heat energy from the sun, has drifted over a small section of the earth, carried by sun-driven winds. What a different perspective!

Children have no perception of the magnitude of the star that powers our solar system. They don’t know that it’s 100 times larger in diameter than the earth itself. They can’t imagine that the sun couldn’t be covered, even if all the water from the earth were poured on it. They don’t understand how much power the sun’s nuclear furnace beams into space in all directions. They don’t comprehend that the tiny amount reaching the surface of the earth from 93,000,000 miles away, still has enough power to drive our entire weather system.

The power of the sun is the power driving the clouds. In fact, without the sun there would be no clouds. The sun is always “out,” always shining. The very fact that it’s “out” is what gave rise to the clouds’ existence. The truth is, the shining sun forces all the water evaporated from the oceans to rise in helpless obedience, to dance on the face of a sun-drenched earth. “The sun isn’t out today” no more explains the truth, than it hides the feeble understanding of the speaker.

Yet we speak casually of the sun being “covered by the clouds,” as if the clouds could hold sway over the sun, rather than be frantically, helplessly and hopelessly driven by it. It’s the sun which holds no notice of the clouds, small puffs of water vapor, so far away they cannot be seen from the sun’s surface, millions of miles away, a mere after effect, a trifling artifact, of trace amounts of its mighty flow emanating powerfully into the universe.

Do the clouds cover the sun? Let them try! Dare they come close, the sun would swallow their puny mass whole. The sun would rip their molecules apart, and burn their puny matter as nuclear fuel in an instant, and take no more notice of the clouds than a forest fire being thrown a Kleenex.

When viewed from a point away from our comfortable home on the surface of this planet, it’s easy to see that the sun is far from troubled, blotted out, or held in check, or diminutively kept from “coming out” by the clouds. Yet, I doubt if the use of the phrase, “a storm cloud wipes out the sun” raises immediate suspicion in your mind.

Indeed, why should it? It’s conventional wisdom. It approximates the truth – by a long stretch of metaphor. The phrase is rich in metaphorical content and, after all, metaphors are all we have upon which to base our communications.

As long as the intended metaphor is all that is taken from the phrase, there might be no harm in using such poetic prose. Yet, such prose is based on a wrong idea. Herein lies the rub. The error is far from innocuous.

[Editor: Phrases like, “The sun isn’t shining today” and, “The clouds cover the sun,” represent sloppy thinking. By automatically and more or less unconsciously using such sloppy thinking and sloppy talking, we develop the habit of general sloppy thinking and sloppy talking. We get into the habit of not looking for more accurate and effective thinking and communication. We get into the habit of blindly accepting sloppy thought and sloppy talk from others. Currently, this sloppy thinking habit is widespread, prevalent, and ubiquitous among humans at all levels of society – even among philosophers and scientists – and especially among politicians and bureaucrats.

The point that Mr. Penn is making is that from a limited perspective (or a specific fixed perspective), it’s easy to jump to a mistaken conclusion. Another image you may want to use to illustrate the point is that of a house. If you were to look at a house from the outside, or your individual perspective, like you look at the clouds from the surface-of-the-earth perspective, you may make the mistake of assuming that the house is stable, just as you may make the mistake that the “clouds cover the sun.” If however, you were to look at the house from a different perspective, with the walls stripped away for example, you would then be able to see that the foundation is really rotten, faulty and unstable. As a result you would then realize that the house is not really stable at all. The same principle applies to such assumptions about wealth, success and life in general. The presumptions you make based on any limited perspective may not be accurate. The ability to look at different situations from many different perspectives, such as imagining the clouds from the sun’s perspective, enables you to overcome the “wrong ideas” that may prevent your success.]

In this case, the earth-centered-universe point of view is of the same character as the belief that the earth is flat. We view the world through our own perceptions. These perceptions can be small-minded in the animal sense. They are from the animal-substrate senses we have. We tend to see the world from an anthropocentric (self-centered) stance. Hence the sun circles the earth and the clouds cover the sun. This primitive cosmology ruled much of human thinking from the time of Ptolemy to Copernicus. This is the “One Wrong Idea” buried in the metaphor.

What has been the cost of this simple error? If the earth is flat, better not sail off the edge. If “here” is the center of the universe, why venture out past “here” to someplace which can only be something less. We are the chosen people, so there’s no reason not to kill the unchosen. The cost has been horrific. It was cosmology which repressed travel, adventure, communications and cooperation between people. This simple point of view fundamentally held humans back from reaching their current potential for more than a thousand years.

[Editor: And such sloppy thinking, today, still keeps the vast majority of humans locked in a “dark-age cage” of poverty, disease, and strife – to mention just a few of our apparently intractable social problems. Sloppy thinking causes sloppy behavior and sloppy results – sloppy problems!]

Surely, such a damaging error must be viewed in retrospect with contempt. When the myth was finally unseated, people were quite upset. Imagine the irony, a vicious lie trounced in combat with the truth. Did the people rejoice in being freed from the lie? No, they felt lost without it! John Donne said of it, in his 1611 poem, “Anatomy of the World”:

“And new philosophy calls all in doubt,
The element of fire is quite put out;
The sun is lost and the earth, and no man’s wit
Can well direct him where to look for it.
…Tis all in pieces, all coherence gone…”

In his book From the Closed World to the Infinite Universe Alexandre Koyre says Western man, “lost his place in the world, or more correctly perhaps, lost the very world in which he was living and about which he was thinking, and had to transform and replace not only his fundamental concepts and attributes, but even the very framework of his thought.”

So, how well was the old world lost, after all? The tenacity of this “One Wrong Idea” remains strong today. So strong in fact, that we don’t say, “Our portion of the earth is covered by clouds,” but instead remark, “The sun is covered by clouds,” or, “The sun isn’t out today.”

This side discussion began with the line, “Some other idea, or modality of human consciousness, must stand firmly in the way of progress, blotting out the meaning of the idea, as a storm cloud wipes out the sun.” The extended metaphor is strong. From our examination above, we know just how strong the wrong idea of the cloud-covered sun is. By analogy, the Most Basic Wealth Principle must be also hidden by clouds. What are the clouds standing in the way of progress? What is the source of the wrong idea or ideas humans prefer over the truth about wealth?

[Editor: As humans we tend to have and use certain “thought structures” when thinking about the world. These “thought structures” are known as paradigms or mental models which determine how we see, think about and understand the world. The nature of the human mind is such that it builds one thought or idea upon the next to form these mental models, much like one level of the previously described house is built upon the next. In the case of the house, the foundation must be sound in order for the upper levels to be stable. If however, the underlying foundation is faulty, the whole house will be unstable at best, and at worst will collapse entirely.

The same principle applies to our mental models when we think about the world. We have certain “foundation ideas” that support other ideas. These ideas are often “correct” in that they produce desirable results, but sometimes, like a rotten foundation they can be faulty. The result of “faulty foundation ideas” is almost always poor or undesired results. This is the principle behind Mr. Penn’s “one wrong idea” concept. Sloppy thinking such as “the sun being covered by clouds,” or the idea that success for everyone is not possible are results of “faulty foundation ideas” – which is why most people fail to become successful.

“Faulty foundation ideas” are often the result of an inaccurate perception of reality, or what could be called “flawed mental models.” Like an inaccurate map, “flawed mental models” will obviously not produce the results you want. Many people also suffer from self-deceit and/or a lack of understanding of how wealth is really created. Wealth creation, as you will see, simply consists of creating value (usually through hard work) and producing more than you consume. Wrong ideas about how wealth is created are part of a “flawed mental model” and are unlikely to produce desirable results. People who suffer from such faulty thinking may nevertheless become successful, but their chances of success are greatly reduced. Usually it takes only “one wrong idea” to separate you from success.

To overcome your “flawed mental models” you may want to read the chapter entitled “The Reality Habit” in Robert Ringer’s book Million Dollar Habits. You could also improve your ability to look at things from many different perspectives, as discussed in the house analogy.

Finally, one of the most fundamental principles in overcoming “wrong ideas” and “faulty foundation ideas” is to learn to question everything, especially those ideas and assumptions that you take for granted. If you were to question the general assumption that the “clouds cover the sun,” or that the “world is flat,” you would realize that such assumptions are false, or only partly true at best. To achieve this you may want to ask yourself questions like, “The house looks stable, but is it really, and what would it look like with the walls stripped away?” Consistently ask yourself the question, “Is the way I think about x necessarily the case? Does x accurately represent reality?” Using questions like these to look at things from different perspectives will allow you to realize that there is no “magic bullet” for success, and that achieving what you want is within your grasp. Apply these fundamental principles in all areas of your life and watch the beneficial results you achieve.]

Animal Nature
The answer lies buried in our animal substrate. Now, let’s reveal it. Animals are generally range-of-the-moment creatures. The concept of wealth as humans know it isn’t pertinent to animals. The container, one of our most fundamental tools, is seldom used by animals. The few exceptional cases, such as squirrels hiding nuts, and bees storing honey, are notable because they are exceptions, rather than the norm. For the most part, the storage used by animals is limited to food in their bellies and fat on their sides. So the stored wealth in the form of future values which humans see as wealth has little counterpart among other animals.

Yet, there are two measures of wealth prominent in the animal kingdom: one is territory held, and the other is position in the social order. In The Territorial Imperative Robert Ardrey identifies the fundamentally universal importance territory has for animals. Even simple planarian worms have a sense of territory. Interestingly, territory is defended against similar species, while non-similar species are generally treated as if they didn’t exist. In other words, a robin will certainly defend its territory against another robin, and probably against a crow, but couldn’t care less about a rabbit. Since territory generally is an intra-species phenomenon, it could also be seen as a manifestation of social order. Within territories animals forming packs or herds almost always have social orders. A great amount of time and effort tends to be spent sorting out the “pecking order,” whatever the species. The time and effort wouldn’t be spent if the activity were not worth something to the animals. Therefore, we can conclude that position in the social order ranks as wealth to animals.

[Editor: Animals high in the “pecking order” tend to get the first choice to eat the available food. They therefore tend to get the most and best food. Thus the “pecking order” or position in the social order has great survival value – particularly because most animals suffer from food shortages for much of their lives.]

The tendency toward gaining position in the social order is so valuable to animals, that it often overshadows more “logically valuable” activities, such as their safety. Animals are often injured fighting for social status, sometimes fatally. If not injured by each other, they often attract predators by their exertions. Big game hunters often find rams by listening for the clash of their horns as they struggle for dominance. Position in the social order must be extremely valuable to animals, if they let its practice threaten their survival.

[Editor: Another important benefit to being high in the “pecking order” is getting the best mates and enjoying the most sex!]

Recently-conscious humans still carry these same substrate-animal tendencies. [Editor: See the Report: How To Increase Your Consciousness for an understanding of what Mr. Penn means by “recently-conscious humans.”] This then explains the idea, or modality of thinking, standing firmly in the way of progress. Humans have a tendency to see the greatest wealth as their standing in the social order. This is “wealth” as seen through the “mind” of an animal. It’s also “wealth” based on win-lose relationships – because animals fight win-lose battles in order to rise in the “pecking order.”

[Editor: This type of social positioning could more accurately be referred to as the “pecking order superstition,” because it is another “wrong idea” that gets in the way of an accurate understanding of wealth creation, and thus success. It is a “superstition” because some people falsely believe, similarly to animals, that their “pecking order” social status will bring success. It’s a “faulty foundation idea” that prevents many people from achieving success. You might ask yourself: “Is the activity I’m currently engaged in supporting my ‘pecking order’ status at the expense of success, making money, and living a free and self-actualizing life?” Minimizing your time spent seeking “pecking order status” may be an important success principle.]

When we celebrate sports, we uphold this mentality. There’s prestige in holding a position on a team. This arrangement approximates the social order inside the pack. By the end of the game, one team has won, the other has lost. There is prestige for the winners. This honor approximates the pack gaining control of the desired territory and the opposing pack losing it.

Notice that the efforts of the losers are not rewarded at all (at least not with prestige which is at the core of animal wealth). It doesn’t matter how well they scored. If they lost, they lost. For instance, compare two games. One game between teams A and B has scores of 98 to 97. Another game between teams C and D has scores of 54 to 48. Teams A and C are the winners. That losing team B scored more points against a better opponent than winning team C is largely irrelevant. Clearly, sports is based on win-lose reward systems with roots coming from the animal substrate.

[Editor: Does this have something to do with why sports (and music) superstars are such sought after sexual partners? How many people perceive them as being at the top of the “pecking order?”]

Animals principally deal in win-lose relationships. In a few other situations, they deal with each other on a seemingly altruistic basis, such as a mother-and-child relationship, where the child is defended at the risk of the mother’s well-being. This is still a win-lose relationship. It’s different only in the sense the mother appears to take the losing position “voluntarily.” Cooperation, other than as established by the social order, is indeed rare in animals.

Humans have the same capacity for win-lose relationships as animals. Depending on the individual’s depravity there may perhaps be a preference for win-lose relationships. Conscious, moral humans have a different method of arranging interpersonal relationships – voluntary cooperation. This is not “forced cooperation” as found within a social order based on win-lose positioning. Voluntary cooperation is true value-for-value cooperation where all parties win. This type cooperation results in win-win relationships.

Human Voluntary Cooperation
Two abilities of conscious humans are crucial to win-win cooperation. One is communication. Cooperation is not possible until communication is possible. Cooperation implies agreement. Agreement implies communication on intended methods and goals.

The other ability crucial to voluntary cooperation is “time spacialization,” which is basically the ability to see time as extending into the past and the future. Time spacialization makes it possible for humans to exchange current values for future values. It is necessary so agreements can be carried out in the “seeable” future. This makes contractual behavior possible.

With a few exceptions (some symbiotic relationships are found in nature among animals and insects), only conscious humans are capable of arranging such win-win relationships. With language came the capacity for communication. With the advent of visual language, i.e., writing, came the ability to perform time spacialization, according to Julian Jaynes in The Origin of Consciousness in the Breakdown of the Bicameral Mind. However, the number of conscious humans willing and capable to abandon the primitive bicameral animal tendencies are relatively few. Instead, many of us often rely on our earlier programming, remaining stuck in primitive “social-order thinking and behavior.”

[Editor: A key element to achieving wealth and success is to reprogram your brain to overcome such faulty “social order thinking and beliefs.” Increasing your personal power in this area and reprogramming your brain for success in general is a powerful way to overcome obstacles such as “wrong ideas” and “faulty foundation ideas.”]

How Some Humans Think
When people are asked in studies, what they need to be better off, there is one common theme to their reply, “If I only had a couple thousand dollars more, I’d be better off.” Their premise revolves around some small incremental additional income that would give them immediate prosperity. Now this is interesting because it shows a wrong idea at work. The guy who is making $10,000 a year says that if he only had a couple thousand more, he’d be better off. The guy who is making $12,000 a year says that if he only had a couple thousand more, he’d be better off. The guy who is making $14,000 a year says that if he only had a couple thousand more, he’d be better off, although he is making a couple thousand more than the guy making $12,000 a year, and twice-a-couple-thousand more than the guy making $10,000 a year. And so it goes ad nauseam.

What does the guy making $40,000 a year say? “If I only had a couple thousand dollars more, I’d be better off now.” Here, the fellow making $40,000 a year is making four times as much as the poor fellow making $10,000, but his perception of what is needed to improve his lot is the same. What conclusion can be drawn from this progression? For one thing, prosperity is relative. For another, a couple thousand more, or whatever the incremental amount in improved income may be claimed, cannot improve your lot in life, or allow you to feel that you have finally arrived at wealth.

[Editor: A parallel can be drawn between the worker “fighting” for a $2,000 a year raise and an animal fighting to rise a notch in the “pecking order.”]

Why should this misconception be so tenacious? We can find the answer by looking again at the animal tendencies of humans. Whatever humans have, they tend to spend it on what they see as most valuable. For all animal-oriented and bicamerally-directed individuals, that will be on improving their position in the social order. [Editor: The “bicameral mind” is a kind of primitive unconscious stimulus-response mind. Someone who is “bicamerally-directed,” behaves in an unconscious stimulus-response manner.]

The average human lives at the very limit of his or her means. Much time, effort, and money are spent in attaining and increasing social prestige or rising in the “pecking order.” In Economics, this tendency is recognized as the “Propensity to Save” principle. Below a certain income, everything is spent. Nothing is left over for savings. Above a certain level, people have all the amenities they feel they need and begin saving some of their surplus. I don’t know where economists say that level is now, but it’s way above the average income. Hence, the average human doesn’t save and never comes to any wealth at all.

Instead, increases in salary are spent on improvements in life-style. A used pickup truck and a BMW both get you to work, but one costs ten times as much. A 1,000 square foot house in an older “retired” neighborhood provides adequate shelter, but a 3,000 square foot house in Upper Yuppyville might make you the envy of your coworkers, at ten times the price. There is easily an order of magnitude difference between the amount spent on such functionally equivalent “necessities.” The runaway condition of chasing an ever expanding dream is euphemistically called, “keeping up with the Joneses.” Most humans attempt to live beyond their means – in order to elevate themselves in the “pecking order.”

[Editor: Could this tendency to spend every last penny on increasing pecking order status be why the savings rate in the U.S. and some other western countries is so low?]

Fortunately, you cannot live beyond your means for too long. Short of using misrepresentation, fraud or force, no one will sell things you on credit if you don’t have the capacity to pay back. It’s not in their rational interest to do so. Does this mean credit isn’t ever given? No, you have two things of value. One is what you have produced, that is what you made, or your paycheck. The other is your ability to produce things in the future. If you are deemed a serious enough fool to trade away your future, not exactly for the things you make now, but instead for your ability to make things in the future, many will extend you credit. By doing so, your work becomes their profit. Every interest payment you make on your debt comes to them as interest payment on their savings.

Perhaps a moment spent detailing this situation will help improve understanding. What can the average human hope to earn in a lifetime? Let’s say, he can make $40,000 a year for 30 years. That’s $1,200,000 (not counting potential investment interest). Now, how much does the average human keep of this more-than-a-million bounty? Essentially nothing. What became of the vanished million, or so, dollars? Part of it was spent as payments for necessities and all the excesses to keep up with the Joneses. And a major part of it was spent as interest payments on the house, cars, boats, meals, entertainment and such things obtained on credit.

[Editor: Living this way is essentially “wealth slavery.” By spending more than you make (consuming more than you produce) and living in debt you are essentially enslaving yourself to others. The interest you pay to others is not really wealth they created, it is wealth you created, but will never see because you have already enslaved that part of you to others. By using credit (debt) to live a “higher” life-style, you are actually decreasing your wealth and life-style by giving part of it away to others in exchange for the use of their money (interest). To maximize your wealth and success you must minimize the amount of your value that you enslave to others.]

It’s strange. Life is comparable to the following analogy. Every man wins the lottery at the age of manhood and gets a slave worth $1,200,000. Very quickly, he trades the slave’s future for things he currently consumes. The slave becomes more and more owned by others in trade for excesses that give social status. In the end, he essentially winds up giving away the slave. Too late he realizes that the slave was his wealth that he had relinquished.

Without knowing the Basic Wealth Principle, his only hope of getting wealthy is to win a lottery. The possibility of growing wealthy by winning at life’s lottery “a second time” is something like 1 in 10,000,000.

Lotteries are of such useless character as to be laughable! Adam Smith says of them in Wealth of Nations, that hope is ever present. If there were any use in winning a lottery, one should buy all the tickets and be sure of winning. The prize, however, would not be equal to the price paid for all the tickets. If it were, there would be no incentive for the promoters to run the lottery.

How many today count winning the lottery as their only hope of becoming wealthy? How few understand the foolishness of trying? Let me show you the very futility in it. Many count on winning the $10,000,000 Publisher’s Clearing House Sweepstakes. After all, it costs nothing to enter, right? Let me ask, how many people enter under this premise? If every household in the United States is reached, and most return the entry forms, how many entries will there be? Let’s suppose it’s on the order of 50,000,000. What’s lost to the people in entering? For one thing, approximately $16,000,000 in postage. Frankly the odds don’t justify the cost of mailing the entry in. How great is the prize of $10,000,000 in comparison?

Further, mailing out the entry form is quite costly. Publisher’s Clearing House must spend a great deal on maintaining a mailing list without duplications. The packet with the entry form and the magazine offerings is not free either, and it also takes postage to get it into the hands of the participants. That mailing must cost more than $16,000,000. So the cost of running the Sweepstakes must approach a dollar per household in the United States, nearly $50,000,000. Publisher’s Clearing House would not run the contest if they did not make more than this for their effort. Where does the money to do this mailing come from? From people with too much hope and not enough sense to know that ordering the magazines don’t help their chances of winning. What in human nature promotes such unrealistic desires for winning lotteries, that they engage in such losing behavior? Notice that lotteries are win-lose relationships.

Other than a second visitation by the goddess Fortuna, how are humans to become wealthy? By managing the first gift of fortune. Always participate in win-win relationships, or don’t participate at all. Become more conscious. Understand time. Make your time on earth more productive. Live below your means. Grow your wealth. Most importantly, learn the Basic Wealth Principle.

“Saving” in and of itself is not the way to wealth. Putting savings in one pile and adding debts in another does not lead to wealth. Having “things” in and of itself cannot make wealth. Piling things in one pile and debts in another does not lead to wealth. Controlling “spending” in and of itself is not the way to wealth. Putting nothing in one pile, but insuring no debt is piled in another, also does not lead to wealth.

The Most Basic Wealth Principle
The Most Basic Wealth Principle is this: Produce more than you consume.

There is only one way to create wealth, and that is by producing more than you consume. With an important qualification (covered below), the wider the gap between what you produce and what you consume, the greater will be the rate of increase in your wealth.

[Editor: Another way to describe producing more than you consume is to use the terms “delay of gratification” versus “instant gratification.” If you immediately consume what you produce you are receiving “immediate gratification,” but if you produce more than you consume on a consistent basis you are “delaying gratification.” All truly successful people know that success is ultimately achieved, not immediately, but in the long run through the delay of gratification.]

What passes for common wisdom teaches something quite different than this principle. The conventional wisdom is “You have to have money to make money.” Hence the only way to start a venture is with OPM, meaning “Other People’s Money.” The truth is, if you can’t produce more than you consume, you will likely eat the substance of OPM and never get to positive cash flow, hence wealth creation. Indeed, this is the fate of about 7 out of every 10 businesses. If one can’t make a profit with a little money, what is different that a profit can be made with a lot of money?

Common wisdom often sides with the something-for-nothing dream. Like scavenger animals, we wish to find wealth already created and intact. The harsh reality of producing more than is consumed is unpalatable to an animal who lives in the range of the moment, without a concept of accumulation of wealth over time.

The moral conscious human produces more than he or she consumes. By following this plan, he or she cannot help but come to wealth. Even a lowly pauper, applying this principle will come to a better end than those who consume all they produce.

Remember, prosperity is relative. Today, we live better than the richest kings of old. They suffered poor eyesight, rotten teeth, wretched sanitary conditions and dwellings inhospitable by our standards. Most diseases were fatal to them. They never heard an orchestra, flew like a bird, made a telephone call to their mother or rode faster than a horse could carry them. Yet they were the richest men alive.

Our opportunities come from a capitalistic system. Capital is created when more is produced than consumed. Follow the Basic Wealth Principle. Help others follow it, too. It’s the path to even greater achievement and wealth for all.

About the Author
Nick Penn is a self-made multinational multimillionaire. He owns, among other things, several businesses in the United States and the Philippines, two homes, a twin-engine airplane, and about 50 race horses. After leaving the U.S. Navy as a commissioned officer in 1979, he took an engineering position in industry. Tragedy struck in 1979 when his life savings in the form of the 40-foot yacht he lived on with all his worldly possessions burned to the waterline. Since the early 80s, he started several businesses.

Annual sales of his first start-up, New Micros, Inc., today number in the millions. He estimates his wealth to be about $6,000,000. This was accomplished with no outside investment, or OPM [“other people’s money”]. His companies’ financing came entirely from sweat equity.

After discovering many of the secrets of wealth described here, he lived them. He always lives below his means and produces more than he consumes. As a result, the small portion he spends on himself in consumption now surpasses most people’s means. Yet he is not pretentious, is not easily spotted in a crowd, and does not dress or act in ways intended to attain social status.

Editor’s Additions
Three further questions need to be answered:

  1. How do you produce more than you consume?
  2. What do you do with your surplus (the difference between what you produce and consume) in order to maximize the growth of your wealth?
  3. How do you persuade others to produce more than they consume, in ways beneficial to both them and you?

For most people the simplest way to produce more than they consume is to work at a job, earning as much as possible, while cutting expenses to the bone. You need some wealth accumulation to get started. But remember, JOB = Just Over Broke! It’s very difficult to build any significant wealth by working a job. But you can start building your “seed capital” that way. While working at a job, you can still do things in your spare time to earn extra money.

And then you can take your surplus to Las Vegas and gamble it away, or you can invest it in the stock market – or any number of other things. How you apply your surplus is crucial to the rate at which you build wealth. This is the important qualification mentioned on the previous page.

Some people produce more than they consume, but they squander their surplus – so they never become wealthy. There are all kinds of conmen, conwomen, and thieves out there, constantly looking for suckers and marks to separate from their money. (Some people put government bureaucrats in this category!)

In other Reports we’ll have much more to say about what kinds of things you can do with your surplus to maximize the growth of your wealth. There are many ways of persuading others to produce more than they consume, in ways that are highly beneficial and profitable to both them and you.


by Frederick Mann

Do you know that a majority of people hate their regular 9-5 type jobs? Do you know why?

In an interview Jerry Rubin said that working for a wage – selling your time – was a form of secret slavery because nobody forced you into it. He said that from youth people are propagandized into selling their time (that is, get the typical 9-5 job) and into believing that this was capitalism or fee enterprise.

The problem is that if you sell your time this way, you’re a “wage-slave.” You earn so many dollars per hour and that’s it. You have to do what the boss tells you. Often there’s little or no scope for you to apply your initiative to greatly increase your earnings. Working for wages or a salary makes it virtually impossible to achieve financial independence and freedom.

So you have to break the idea of selling your time for a fixed amount of money. Your time is valuable. You want to spend it to maximize your earnings.


A “wage-slave” must keep working to continue earning. Even if you’re a consultant or a professional earning a high rate of pay – without the usual restraints of “wage-slavery” – as soon as you stop working, the pay stops. This is called linear income.

When you own your own business, or you participate in certain network-marketing programs, you also get paid for part of the work of others. This is called residual income. You not only get paid for the work you do in your own time as you please, but you also get paid for providing others with jobs or other opportunities, receiving a percentage on their performance. This is where you find the big money – and the big money that keeps coming even after you stop working!

It’s useful to think in terms of creating a “money machine” that you can set in motion and build up to the point that it develops a “momentum” of its own. You can then stop working, while the “money machine” continues to pay you.

You can also think in terms of a “production machine” that “automatically” produces (even while you sleep!) more than you consume. There are sophisticated ways of applying the Most Basic Wealth Principle: Produce more than you consume!


by Frederick Mann

I started a company with a few friends several years ago with a capital of $250. (Yes, $250 – it’s not a misprint!) Very quickly, without any donations or outside investors, we increased our monthly income to over $50,000.

From the outset the company was designed so that only small steps were necessary to achieve huge success. We only had to take little steps like: complete the next report, write letters, make phone calls, send out information packages. This is the “Small-Step-Progression Principle.”

The early steps need to be small, easily executable, and become profitable relatively quickly. We never needed a big backer or investor to proceed. There were no big hurdles to overcome. We just needed to take a few little steps every day. The company was also designed so that each little step made the next step easier. As we gained more customers, and more and more people started supporting us, our momentum grew – like a snowball running down an almost endless mountainside. The company was, in fact, self-perpetuating!

The Small-Step-Progression Principle is extraordinarily powerful. It enables you to start with little or nothing and build one or more “money machines” that will make you one or more fortunes within a few short years.

Some examples of how you can do this for yourself – as well as some of the things you may need to learn to succeed – are described in the article below, and various other Reports.

You may also want to apply the Small-Step-Progression Principle to your personal growth and development. Every day you could think of something to do to improve your competence in some area of your life.

I first got the idea of starting such a company in 1972. During the following 21 years I made many attempts to get something going. Most of my attempts failed. But I continued to work on personal growth and increasing my knowledge and competence in areas such as my ability to create and improve personal and business relationships, writing, and marketing. A big breakthrough occurred when I discovered “The Path of Least Resistance.” — See Report #10: How To Achieve and Increase Personal Power


by Frederick Mann

1. Find a Need in the Market and Provide Products and/or Services to Fill that Need
There are very few people who feel completely satisfied – experiencing that they have everything they need and want.

2. Increase Your Ability to Earn – LEARN!
To earn more money, you may need to acquire additional knowledge and skills. You may need to improve your ability to recognize opportunities and take advantage of them. You may need to overcome your negativity and increase your personal power. You may need to increase your personal freedom and power. Every hour invested in this respect can earn you much more in the future.

3. Gain Wealth through Multiple Income Streams
An advantage of this strategy is that your wealth doesn’t depend upon any particular means. Even if one income stream fails, you still have the others.

4. Pay Yourself First
One of the most important principles of wealth is to take at least 10% of your earnings and set it aside as your payment to yourself. This is not spending money. It’s money you set aside to work for you.

This wealth secret of paying yourself first represents one side of the Most Basic Wealth Principle: Produce more than you consume.

5. Control Your Expenditures
If you’re like most of us, you spend all the money you earn “hand-to-mouth.” It’s an operating basis that keeps you stuck and prevents you from accumulating wealth – a formula for poverty! You can break out of this trap by using the strongest criteria for spending are: “Do I really need this?” and “What’s the minimum I can pay to get it?”

This wealth secret of cutting your expenses to the bone represents the other side of the Most Basic Wealth Principle: Produce more than you consume.

6. Make Your Home a Profitable Investment
Most people, when buying a house, first look for one that they like. Then they find out the price. Then they find out how big a mortgage they can get and how much the down payment has to be.

The more wealth-conscious do it differently. They look for a house that is appraised at, say, $200,000 that they can buy for $150,000. They get a mortgage for $190,000 and invest the $40,000 difference for a higher return than the mortgage interest rate.

7. Discover Your Deep-Seated Attitudes and Beliefs about Money and Correct Them if Necessary
Many of us have limiting – even debilitating! – attitudes and beliefs about money. Some of these are culturally widespread – for example: “filthy lucre” = “money is dirty”; “money doesn’t grow on trees” = “money is scarce and difficult to get”; and some people believe that “money is the root of all evil” and “you must have money to make money.” Correcting your attitudes and beliefs about money is one of the most important wealth secrets and is covered extensively in the ‘Millionaire’ report series.

You’ll find many more wealth secrets as you read through the other Millionaire Reports, and the various other reports, articles and books provided in other areas.


by Frederick Mann

As indicated in Nick Penn’s article, among animals and insects scarcity is the rule. In general, for most animals and insects, there isn’t enough food to go around. Many animals and insects starve to death for a lack of food. For most of human history, pervasive scarcity was suffered by most.

Today, in some parts of the world, many humans still live in conditions of perennial poverty and starvation. For them, scarcity is still the order of the day. Some of them still starve to death for lack of food. Scarcity is a pervasive belief that colors their entire consciousness. A world of plenty probably seems an impossible dream to many of them.

So it’s no wonder that many humans still live their lives out of a deep-seated, pervasive “scarcity orientation” that colors how they see the world. It’s as if they wear “scarcity spectacles” that distort their vision. They see resources as limited and scarce.

In a primitive “scarcity community,” if one person were to take more food than his “fair share” in order to completely fill his belly – or, even worse, hoard some for the future – he would be seen as evil. If he produced more than he consumed and tried to hoard the surplus, he would be seen as evil. Keeping his surplus – or “profits” – would be seen as an evil act.

Could this have something to do with the fact that many people still see profits as evil?

If you think in terms of a “fixed pie economy” – limited by scarce resources – then anyone perceived as consuming more than his or her “fair share” of the “fixed pie,” tends to be seen as evil – no matter how much he or she actually produced. Furthermore, anyone hoarding his surplus or profits – thereby accumulating wealth – tends to be seen as some kind of thief, because he or she stole from the “fair share” of others.

But what if we really have an “expanding pie economy?” What if Buckminster Fuller was right in saying that we have such abundant resources that every man, woman, and child on earth should be a millionaire many times over?

“Fixed pie economy” thinking is another “wrong idea” or “faulty foundation idea” you may need to overcome. Reprogramming your brain to think in terms of an “expanding pie economy” is another important wealth principle. Think about it: when you create something, does your creation process take away from someone else’s “fair share?” Of course not! What you produce is in addition to what everyone else produces. There is no limited amount of wealth of which anyone has to get a “fair share.” Everyone has the potential freedom to create as much wealth as he or she chooses. [For more important points about profits, read the article: Why A Business Must Be Profitable.] In other ‘free-enterprise money-making’ reports we’ll tell you how to develop and expand your freedom to create more wealth.

Value Production and Value Destruction
I propose a simple formula: Production greater than consumption equals Value Creation; Consumption greater than production equals Value Destruction. Surplus or profits represent value creation or production – also savings or wealth accumulation or capital growth.

Now think about government bureaucrats. In general, do government bureaucrats produce more than they consume – or the reverse? On balance, are government bureaucrats Value Producers or Value Destroyers?

Now consider the so-called “war on drugs.” Do these actions produce more than they consume, or the reverse?

Now think about taxes. Why is it necessary for government bureaucrats to tax people?

We’ll return to the subject of government bureaucrats in some of the later ‘Millionaire’ reports.


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