The Gun And Butter Theory

Today I came face to face with the Gun and Butter theory. This theory goes way back to the founding of America. The Indians had butter, the settlers had guns. We know who took over. Today the gun and butter theory is used as an investment analogy. Basically, we can buy two things with our money; gun or butter. What’s the difference between the two? Guns appreciate while butter depreciates. Examples of guns include stock, real estate, collectible, anything that goes up in value or makes income (other guns). An example of butter is almost anything in your house, except the house itself.

It’s pretty simple and easy to say that we should all be acquiring guns, because guns make more guns, while Butter just melts. However, most people go through life buying butter and no guns, or they buy butter thinking it’s a gun, when in fact it’s just a very expensive piece of butter.

Why am I talking about this? Well today is Dell’s 2nd day of their 12 days of deals and today’s deal is on their LCD displays. They have the 20.1” wide screen for $499.00 and the 24” unit for $849.00. Great prices for sure and I was really tempted to pick up two 20.1” for Sarah’s computer. Then we will have matching monitors. However, Sarah reminded me that computer hardware is really fast melting butter, and our job is to acquire more guns.

For many people the only gun they have is their house, and the truth of the matter is, it’s not really a true gun. When I look at the amount of guns I hold I realize that I really need a lot more if I’m to create the kind of lifestyle I envision for myself. The truth of the matter is, you can’t get there by working – you can only work 24 hours in a day. However, guns make more guns, and those guns make more guns, and so on. Get enough guns and you can have all the butter you want.


8 thoughts on “The Gun And Butter Theory”

  1. Nathaniel says:

    Thanks for the pinch. I have been buying way to much butter lately. Time to stock up on some of real assets.

  2. The True Gun is yourself. But you can also be made of butter.

  3. Carl says:

    Cheese is good.

  4. John Chow says:

    The true gun is your head. But the problem is guys have two heads. The one above his neck – that’s the gun head, and the one between his legs – that’s the butter head. Unfortunately, many guys think with the wrong head. 🙂

  5. Jan says:

    I think the key thing is to find something that makes money AND that you also enjoy doing like stocks. If you don’t enjoy what you’re doing you will be more apt to spend money on frivolous things.

    Then again it’s also important to set aside SOME money for “wasting” whether it be on your children, yourself or your spouse because it keeps you balanced and rewards you for your hardwork.

    I think what everyone goes thru when they are young and have any sort of financial success is that they think it will forever be like that. Plus you want to have flashy cars/clothes/lifestyle etc. As you get older you start to smarten up and realize that financial security is much more important then any material object.

  6. blam says:

    guns don’t taste good on toast though. does anyone know of a case where someone was killed by butter?

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