According to Forbes magazine, the fortune of the number one richest person in Israel, Patrick Drahi, jumped by $601.3 billion in just three months, and is currently estimated at $10 billion.
The fortunes of Israel's 500 richest people have grown by 300% in the past 12 years. The fortune of the richest Jew in the world grew by 20% in the past year to $43 billion. The fortune of former New York Mayor Michael Bloomberg also grew by about 22% this year to $27 billion. Bill Gates' fortune is also growing steadily, thus managing to maintain the title of "the richest man in the world" for 19 years.
Another statistic: The private wealth of all the inhabitants of the Earth soared during 2013 by approximately 14.6%, and if you are wondering how, then, the penny in your pocket is not enriched? - the following statistic will provide the explanation:
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In 2013, 42% of the world's private capital was held by millionaires, compared to 39% in 2012. This figure indicates a phenomenon that has existed for decades, but is gaining momentum and taking the form of a trend in recent years.
In the world of the rich, losers are a minority. They get much richer and on every investment they earn at least twice as much as average investors.
How does this happen?
To understand exactly how this happens, let's examine the factors that drive profit. To get rich, you need to invest in a particular product and generate a large return on your expenses.
There are many products on the market from which you can make a profit, but the purchase price of the product is determined by competition with other potential buyers, and it is clear that the higher the amount of investment required, the smaller the number of potential investors.
A correct economic view is to buy a product when there is little competition for it, and sell it when there is great competition for it, which directly results in a selling price that is higher than the purchase price.
For example, purchasing a plot of land to build 50 housing units in Jerusalem is a good investment by all accounts, but on the other hand, there are not many wealthy people who can afford to purchase a plot of land of that value, and in any case the competition for it is relatively small. However, when it comes to selling the apartments, when each apartment is a transaction in itself, many potential buyers will be added, since the investment amount is much smaller.
The smaller the apartments (not too small), the greater the competition and will generally yield a higher profit. Here is an example of investing in a situation of little competition, and selling in a situation of great competition.
You too can be partners in large properties.
The stock market was great news at the time. It allowed even those with small fortunes to become co-owners of large and even the largest companies.
In the last decade, the news also reached the real estate sector: the purchasing groups that were established like mushrooms after the rain, in fact, were an opening for ordinary people to enter partnerships on large projects. Over time, new regulations, along with excessive control by purchasing group managers, made things less profitable.
To transfer the stock market model to the real estate world, you don't need too much. In fact, don't rule out any investment that sounds too big to you. Recruit additional investors to be partners with you, and in doing so, you've created a great investment group.
To purchase a large product that is in small competition, you don't need to be rich; it's enough if a large number of small capitalists unite into a large purchasing group and also play on the business field of the big guys.
We must constantly strive to increase the capital of the investment group, in order to add to the billion-dollar competition another bloc of investors who take the place of one billionaire.
• Moshe Revach is the co-CEO of Empiria Real Estate and Finance, which develops and manages real estate ventures 02-6222255
