Building these sites, attracting millions of users and then selling out to a bureaucratic organization, seems very familiar these days and is happening more often than not. They do realize it will be used millions in the future, but the million (or billion J ) dollar question is – will it stick? More precisely speaking, will they last, more than the usual 5-7 year shelf life?

The Economist recently provided some much needed coverage in this area.

I was recently reviewing my financial state and planning for the coming years, when I was hit with the realization that I’m being robbed blind. To begin with, I, as any other conventional citizen have a savings account where the large majority of my investments are funded based on the belief that it is increasing monthly with the generosity of our banking system and their great invention of interest.

Well, you are probably thinking, ’so where’s the loss’ - right? 

1. To begin with, we would need to state the prevailing economic factor of inflation. In Dubai (UAE), inflation last year hit an all time high, with conservative estimates placing it between 9 - 20%. 
2. Interest on fixed deposit and savings accounts are between 2.5 - 4% (if you’re lucky).

Now, taking these into consideration and estimating an average from each, you can work out the following.
Example Scenario:
A. Inflation = 15%
B. Interest = 3%

An investment of 10,000 for a year would  earn you 300 (meaning 10,300). All looks good right? Not really.
The inflation eclipses your earned interest and reduces the value of your investment by 15%, resulting in 1,500 (meaning 8,500). So, in effect you dont even make a profit, but quite a substantial loss of 12% (15 - 3%), which would leave you with a purchasing value of 8,800 in the bank. Less than what you initially deposited. Yes, you ultimately will get your 10,300 - however the purchasing power of that amount is far less than its actual figure, which enables you to buy less things.

Economists have been highlighting this point quite vocally for the past few decades, stating the fact that the value of our currency is diminishing and our buying power is draining every year. We on the other hand live under the illusion that its actually increasing. 

I would conclude in recommending you to actually do your own calculations and weigh out investment opportunities with these factors in mind. In other words, you cant be getting ‘richer’ if your investments aren’t earning you more than 15% a year.