If you could sell $100,000 worth of fruit at a grocery store and make $60,000 in profit or sell $100,000 worth of refrigerators at a local retail store and make $60,000 in profit, which would you prefer? The right answer to that question depends on one unknown variable: time. The quicker you can get your hands on that $60,000 in profit, the more valuable the business. If you are selling fruit in a major city center like Chicago or Los Angeles, you might be able to sell that in a month. The velocity of money is important because the sooner you get your hands on that $60,000, the quicker you can redeploy it into new investments that will also pay you money. That is compounding.
That is why this site has such an affinity for the Colgate-Palmolives, Nestles, and Hersheys of the world. The companies have brands that permit them … Read the rest of this article!