The legendary woman who was reborn from the ashes

The essence of the Way of Heaven lies in balance and harmony. It is like an invisible wise man, always skillfully regulating the gains and losses of all things in the world.

When something is too full, the way of heaven will cleverly cut off the excess to supplement the deficient things. The wisdom in this is like a skilled craftsman, carefully carving the beauty of balance in the universe.

In contrast, human morality often deviates from this principle. In human society, we often see unequal distribution of resources such as wealth and power. People tend to deprive those who are already lacking of resources, and flatter and admire those who are already rich. This biased orientation has exacerbated social inequality.

However, the philosophy contained in the Way of Heaven is eternal and universal. Whether it is the cycle of nature or the complexity of human society, we can find inspiration and reference from it. This is not only a profound philosophy, but also a practical wisdom that can guide our lives.

If we apply this idea to the field of investment, we can get a completely new perspective.

Assume that there are only two types of assets in the market - real estate and stocks, and their yields show completely different trends. The yield of real estate has been stable at a high level for a long time, while stocks have been in a state of loss for a long time. In this context, people will naturally prefer to invest in real estate and ignore opportunities in the stock market.

However, this seemingly reasonable choice contains potential risks. As more and more people flock to the real estate market, housing prices continue to rise, eventually reaching a high level that is difficult to maintain.

At this time, even if the yield on real estate is still high, potential risks have quietly accumulated. Once the market fluctuates, housing prices are likely to plummet, and investors will face huge losses.

At the same time, the neglected stock market may be turning around. As stock prices continue to fall, more and more people begin to realize its investment value. When stock prices hit the bottom, those investors who dare to go against the trend will have the opportunity to reap rich rewards.

This is exactly the embodiment of the philosophy of heaven in the field of investment. It tells us that under the seemingly stable appearance, there are often huge risks hidden;

However, in a seemingly sluggish market, there may be huge opportunities. Therefore, we need to be vigilant and sharp at all times, and be good at discovering and seizing those overlooked opportunities.

Eventually, when the returns of the real estate and stock markets return to equilibrium, we will find that the high returns that once seemed out of reach are actually right beside us.

The risks that once daunted us actually have their own value. This is the truth revealed by the way of heaven - in balance and harmony, we can find the path to success.

The law of nature is eternal, and it tends to reduce those that are excessive and supplement those that are insufficient. This is just like human nature, and the world of investment also follows similar laws.

Investors, like sunflowers chasing the sun, are always abandoning those seemingly dull assets and turning to those shining high-yield varieties.

In the past, they gave up stocks just to pursue higher profits; today, they give up real estate for the same reason.

The way of human nature is to cut down on those who are insufficient and to support those who are in excess. This seemingly contradictory phenomenon is actually unified under the nature of seeking profit. Investors flock to high-yield assets like a tide, hoping to get a piece of the pie.

However, it is this profit-seeking nature that will eventually lead to a balance in the returns of various asset classes.

From this, we can gain insight into a crucial investment principle: all wealth is equal and balanced.

In the world of heaven, all beings are equal, regardless of high or low status. Similarly, in the world of assets, all assets, whether real estate, stocks, gold or antiques, are equal.

Their value lies not in their name but in the benefits they bring.

Just like the 100 yuan earned by Zhang San through hard work in the sewer and the 100 yuan earned by Li Si in a comfortable office, their value is equal. No matter where the 100 yuan comes from, it is the same 100 yuan and has the same purchasing power.

So, what is the public wealth equilibrium? It means that over a long enough period of time, all assets, as long as their lifespan is long enough, their long-term returns will eventually tend to be equal and equal to the risk-free rate of return.

This is because in the world of investment, capital never sleeps. Once the yield of an asset is higher than that of other assets, it will attract a large amount of capital inflow, causing the yield of the asset to fall until it is equal to the yield of other assets.

Why is it that the long-term returns of all assets are equal to the risk-free rate of return? The risk-free rate of return is like a baseline, which represents the safest and most stable investment return.

In most cases, the risk-free rate can be regarded as the interest rate for depositing money in a bank because it is almost threshold-free and risk-free.

We typically look at the 10-year Treasury yield as a benchmark for the risk-free rate, which is currently between 2% and 3%.

As long as investing is profitable and as long as investors can earn higher returns than the risk-free rate on other assets, they will continue to look for and pursue such opportunities.

However, as time goes by and the market adjusts, the returns of these assets will eventually tend to the risk-free rate, achieving a state of public wealth equilibrium.

This process is like the law of balance in nature. No matter how assets change, how they are sought after or ignored, they will eventually return to the equal starting point. At this starting point, all assets and all wealth are equal and worthy of respect.

Only after understanding and accepting this principle can investors truly invest rationally, avoid blindly following the trend, and go further and more steadily on the road of investment.

The continued investment activities pursue one goal - that is to make the investment yield keep pace with the government bond yield.

Regardless of their type and characteristics, as long as they can stand the test of time, their long-term returns will eventually converge and be unified under the banner of the risk-free rate.

Although this principle sounds simple, its practical application requires us to have deep insight and keen judgment.

Investing is essentially a game of buying low and selling high, but the key is how do we define the boundary between "low" and "high"? Take real estate as an example. If a house can bring in 10 yuan in rent each year, and its selling price is as high as 400 million yuan, how do we evaluate the value of this investment?

Here, we can apply the concept of equality and balance of wealth and regard real estate as a special form of deposit. The "interest rate" of this house is the ratio of rent to house price, which is 2.5%, which is quite close to the current yield of government bonds.

However, we must clearly realize that national debt is risk-free, while real estate investment is accompanied by a series of uncertainties and risks. The future real estate market is unpredictable, and whether this house can still maintain its value after many years is an issue that cannot be ignored.

This principle is also widely used in the stock market. Suppose there is a company with a stable annual net profit of about 100 million and no debt pressure, but its market valuation is as high as 8000 million.

In this case, we regard this company as an investment target, and the annual return on the 8000 million invested is only 1.25%, which is far lower than the risk-free rate.

What's more, there is a risk of the company going bankrupt. Unless we have extremely high confidence and certainty in the future of the company, such an investment is obviously unwise.

The risk-free rate of return is like a ruler to measure the value of all assets. With it, we can more accurately assess the true value of an asset and avoid falling into blind and impulsive misunderstandings in investment.

Therefore, when making investment decisions, we must always keep this principle in mind and examine each investment opportunity with a rational eye to ensure that our investments can truly achieve long-term and stable appreciation.