To introduce today’s Creating Wealth Show, Jason Hartman invites Darlene to give a taste of her and her husband’s Roth IRA strategies, of which she will discuss more when she joins the speaker list at January’s Meet the Masters event. She also talks about the positive impact that various masterminding events have had on her personal and professional development.
Later, Mark, a client and follower of the podcast joins Jason to talk about a wide-ranging series of topics. Living in Switzerland, Mark provides an international look at some changes in the world’s real estate markets, but they also consider deflation and inflation issues as well as how the mainstream media is largely in bed with the government, regardless of which country you’re talking about.
Key Takeaways
05.21 – It’s important to remember that you don’t have to invest a lot of money immediately into a Roth IRA. Pick a figure that works for you and your accounts.
11.48 – Masterminding is so important because it gives you the chance to network with like-minded people and it’s the best opportunity to learn.
23.23 – The more multi-dimensional your investments are, the more supported you are.
25.07 – It can be difficult to keep track of inflation levels, especially with governments worldwide seriously understating them.
29.06 – Perhaps we just need to figure out something that needs to be done differently in order to change the situation.
32.50 – Audiences are less and less interested with hearing about certain ideas – just look at the current figures for CNBC.
37.10 – Mark describes the incredible current situation of money creation in Switzerland.
Tweetables
If there is no inflation, where are you going to get the yield?
Transcript
Introduction:
This show is produced by the Hartman Media Company. For more information and links to all our great podcasts, visit www.HartmanMedia.com
Welcome to Creating Wealth with Jason Hartman. During this program, Jason is going to tell you some really exciting things that you probably haven’t thought of before, and a new slant on investing. Fresh new approaches to America’s best investment that will enable you to create more wealth and happiness than you ever thought possible. Jason is a genuine self-made multi-millionaire who not only talks the talk, but walks the walk. He’s been a successful investor for 20 years, and currently owns properties in 11 states and 17 cities. This program will help you follow in Jason’s footsteps on the road to financial freedom. You really can do it, and now, here’s your host, Jason Hartman, with the complete solution for real estate investors.
Jason Hartman:
Welcome to the Creating Wealth Show, this is your host, Jason Hartman, and this is episode number 452. Thank you so much for joining me today. I coerced, and I don’t say that lightly, my helper today for the intro portion of the show, and that is Darlene. Darlene, are you there?
Darlene:
I am here, Jason.
Jason:
Good, how are you?
Darlene:
I’m well thank you.
Jason:
Don’t you love it? See what happens, Darlene? You call me up on the phone to discuss some general business things and I recruit you to help me with the podcast intro. I know you were a little reluctant, so thank you.
Darlene:
You’re welcome, I’m glad to help.
Jason:
Well thanks for joining us. One of the reasons, dear listeners, I really really wanted to get Darlene on is that she has graciously accepted my invitation to speak at our upcoming Meet the Masters event, and I’ve known Darlene since the summer of this year. I first met her in Tampa, Florida at our mastermind meeting, and she’s just a great lady; she does some awesome stuff. How long have you been in the real estate business, Darlene? Maybe just share a little bit of your background real quick, if you would.
Darlene:
Sure. I’ve been into real estate since I was 19 and that was in 1979, so for those of you who are really good at math, you can figure that one out.
Jason:
I was 19 too, that’s funny!
Darlene:
I started off in listing and selling real estate, and then I got my brokers’ license and I realized I didn’t want to shuttle people around showing them houses, so I went to a Dave Delgado no-money-down seminar and it kind of whet my appetite a little bit for investing in real estate. It just sort of took off from there.
Jason:
Dave Delgado was one of those old-time gurus on the infomercials. It’s funny you say that, Darlene, because number 1, the parallels are amazing. I got my real estate license 2 weeks before my 20th birthday, when I was 19 also, and I was in my first year of college. Robert Allen was the guru I first heard of on an infomercial. I kind of got interested in it when I was 16 years old. I met Dave Delgado, the guy that got you into it, at his winery up in Napa on a trip. Boy, that guy drinks a lot of wine!
Darlene:
[Laughs].
Jason:
But yeah, he was a big name guru in his day. Did he ever get indicted or anything? Most of those gurus do!
Darlene:
Well, yes, he did a real nice little thing as the guest of the Federal..
Jason:
Really? Wow.
Darlene:
Yeah, but I too got involved after that. Under the tutelage of a lot of different gurus, I just sort of learnt different pieces about different strategies of investing.
Jason:
It’s amazing. I didn’t know Dave actually spent some time in the Big House!
Darlene:
He did! Now there’s obviously a way of getting around it legally.
Jason:
Well, that’s actually a great segway to your topic. You have really one of the most innovative Roth IRA strategies I have ever seen. I don’t even want to say ‘one of’. I’m going to say ‘the most innovative’. At all of the Meet the Masters events over the years, we’ve talked about self-directed IRAs, we’ve had IRA administrators and custodians at these events. It’s great, it’s just the sort of typical generic corporate speech about that, and that’s all fine. Where it really gets good is when you add some serious creativity to it, and you’ve done that.
Do you want to just whet their appetite a little bit? I know you’ve got to go because you’ve got to get to your company Christmas party, and I talked you into being on with me for just a few minutes, so just share a little bit about that and tell people what they’re going to learn at the upcoming Meet the Masters event.
Darlene:
Sure, I’d love to. My skillset is creating strategic alliances and using your self-directed investment tool, whether it be a Roth IRA or a 401(k) with a Roth component. I call it a fat-stacked IRA, but even if you don’t have a lot of money in your Roth right now, you can partner with financial to work a deal. My space is rehabing, so we create alliances with different people and do loans and synergistic sections. The profits of that investment go right into your Roth IRA and when you are able to take that money out cash-free. Most people think you can only create an investment if you have a bunch of money in your Roth right now. You don’t. I’ve shown people how to invest with just $1,000. You might not be putting $20,000 in your Roth all in one fell swoop, but if you do enough deals and you partner with enough people, you’re going to start realizing a lot of gain in there, and then go off and invest on your own. That’s basically what I teach people to do.
Jason:
Yeah, it’s pretty awesome. The first thing is, Darlene uses some hip slang words and I did not know what a fat-stack was. So I went to Urban Dictionary and I don’t think most of my listeners know what fat stacks are. I just love that. According to Urban Dictionary, a fat stack is a “huge wad of money, usually in hundreds and fifties, carried around by ballers, drug dealers or rich ass basters.”
Darlene:
That basically sums it up!
Jason:
Oh, that’s so funny! Gosh, we can tell you’ve spent some time in Detroit, right?
Darlene:
Oh yeah. That’s where I am right now. I left beautiful Phoenix yesterday and now I’m in cloudy 25 degree Detroit Metropolitan – I need to change that.
Jason:
Yeah, I know you’re planning on moving soon. Do you care to share your husband’s story, because his story of his Roth IRA is pretty awesome and I don’t know if you want to share it on the air..? It’s pretty awesome, I’ll say that. You told me what it was – are you willing to share that?
Darlene:
Sure. As it relates to what?
Jason:
Well, investing. He built up quite a huge account over about a 5 year period, right?
Darlene:
Right, he actually rolled over. He was in Corporate America for a while and he had a 401(k), which he rolled over into a Roth. He then converted that to a self-directed Roth. I can go into detail about that at the event and about how you do that, but he had about $100,000, which is not a huge amount of money to invest in real estate. We attended a lot of events on learning how to partner with people. Owning where you’re staying in the Roth is kind of a dangerous thing to do. If something went bump in the night and you get sued, it would wipe out that whole Roth. We decided to partner with financial friends who would purchase the property. His Roth would fund that yield on a profit participation. I can go into detail on how to structure that at the event, but when a property sells, that profit can sometimes be in the upwards area of $20,000-$30,000. That would all go back with the principle into the Roth.
Over a 5-year period of time, you do that several times and you’re going to have 7-8 times.
Jason:
He’s up to, what, $750,000 now?
Darlene:
It’s a little bit more than that, actually. We were talking last night when I came home and he’s going through a big deal right now. Technically, in the Roth, we have loans – we do hard money loans as well – so we’ll be partitioning off that account, and I’ll be talking about how to do that as well. You don’t want to have dangerous assets, or even half of that, because that triggers the IRS to come and look at the fat stacks you’re putting in there all at one time. We want to pick and choose with this model, so I’ll go through why you don’t want to do that and how to change that.
Jason:
Fantastic. Like I said, everybody, since joining this mastermind group where I met Darlene over the summer, I have learned a bunch of really interesting things. As you know, listeners, I am really skeptical and really slow to take up these new ideas, and mostly that’s been a benefit to me. I’ll give you one example. We have been pitched for quite a while now on doing business in the Oil Sands area of North Dakota. While my competitors ran out and just jumped into that, now the price of oil has plummeted. That’s going to change that market very significantly, up in what they call the ‘man camp’ in North Dakota – because no woman would be muddy enough to live up there! Anyway, that economy is probably going to change pretty significantly. Whenever I hear these things, I’m super skeptical, I talk to a lot of people about them, I check them out. Of course, I’m not perfect either, but I am slow and skeptical and I get a lot of criticism for being slow and not necessarily super creative. I love this idea that you’re an expert on, Darlene, so I can’t wait to have you present that.
Just one more thing before you go, I know you’ve got to run. Any thoughts on our mastermind meeting, any big takeaways you wanted to share with the listeners or whatever before you run away?
Darlene:
Yeah, definitely. I think one of the big highs is that the industry is changing dramatically. Gone are the days of having no money down. There’s more competition. Of course, you can do no money down by using partners and strategic alliances, but I think it’s now a business where it used to be a passive thing. If you’re not on the forefront and you’re not lining yourself up with people and getting ideas from other people and using their talent and leveraging their talent, you’re really going to be behind it all. You really need to network with folks who are in the industry who are smarter than you. I always want to be the dumbest one in the room. That’s just the way it is. With the group that we are in, it is amazing that if you took the talent of a few of those people, you could run a whole country.
Jason:
Oh yeah! You could run a better country, that’s for sure!
Darlene:
You could run a big country in a better way. I always walk away with more than I came with.
Jason:
Me too, me too. The value of alignment and the value of masterminding really cannot be underestimated, so that’s good. Good stuff. Just to your comment before, we’re not talking about what our listeners need to be concerned with – that it’s becoming a business. The reason I say that is because it’s becoming more of a mature industry. Our investors are mostly passive investors that are doing this on the side, but what Darlene is referring to is if you want to be in the business of flipping houses and things like that, that business has become a much more mature and a much more sophisticated industry.
The late-night infomercial deals – it ain’t what it used to be, I’ll just say that much.
Darlene:
Right, that’s exactly right. You’ve got a lot of competition out there and I think listening to podcasts like yours really gives that edge to passive investors. I can’t stress enough how important it is to align with other people who are doing it as well. People think they can’t hang out with people who are investing because they’re their competition – that is not true. That is a big piece of pie out there, and we all represent different markets. In Detroit Metro, there’s money being put in to the infrastructure now that the debt and most of the corrupt politicians are out of there. Investors and hedge-funds are coming in – they’ll always be looking at what’s going on in a market that I might not be in. They’re looking for something that might be the next big thing.
Jason:
There’s an example, by the way – I have not warmed up to Detroit at all yet. I’m just totally not into it.
Darlene:
I know, I know.
Jason:
But I have been watching it. I’ve been watching what people think and in my book, it’s all about population. If there’s immigration – that city is so cheap, you can get deals there all day long. It’s not as cheap as it used to be, by the way, prices have definitely gone up a bit. There’s also this concept of the micro-markets within the overall broader market, of course. You can’t even talk about any city like it’s one city, one monolithic thing. It’s a bunch of neighborhoods and areas and so forth, but yeah. It’s very interesting. That’s another good take-away. You can’t see that, you can’t know that stuff unless you’re having all of these casual conversations with people over a meal, over a drink. That’s one of the other values of our events. At Meet the Masters, we’re going to share many meals together and you’re going to have the chance to network with a lot of investors and hear their experiences first hand – the good, the bad and the ugly, as I like to say. It’s not all roses.
Darlene:
No, it is not. We’ve come to many bumps in the road along the way, but that’s how you learn – it’s through these experiences.
Jason:
I’d just like to say: it’s not perfect, it’s just better than everything else I know of. That’s about as much as I can say for it. It’s pretty awesome in that way.
Well, Darlene, thanks for joining us. Listeners, I will be back in just a moment to talk about some other things with you and continue the show. Thanks Darlene!
Darlene:
Thank you.
—-
Jason:
So I hope you enjoyed that talk with Darlene, and if you think her Roth IRA strategy is exciting, it is, but we’ve got even more in our talk about land contracts coming up at our Meet the Masters event. Be sure you sign up for that at www.JasonHartman.com. Click on the Events section and get your tickets right away.
Before we get to a caller today, one of our listeners and potential clients; I had a discussion with him that was interesting, and he was coming to us from Europe and will probably be coming to Masters. People travel from all over the world to come to this; we’ve had people from the Middle East, from Asia, from very far away, and I hope to see you there too.
Before that, I just thought I’d make a quick mention, and we’ll obviously talk about this on future episodes. Shinzō Abe, you may know that name, you’ve certainly heard it in the news, he is the guy who Abenomics was based on, and it looks like he got a new mandate in Japan as the Prime Minister. It looks like they’ll just continue along the same path that they’ve been doing for so many years, which is massive, massive quantitative easing, as they call it, which is a joke. What a misnomer that is. It’s the reflationary policy, and since it is the holidays, you think of Santa Claus, right? No matter what, with any election, pretty much anywhere in the world, Santa Claus always wins the game. Shinzō Abe just got a new mandate, again, to continue along the way he’s been doing, and so we’re going to see a lot more money creation to try and re-inflate their economy. That goes to show you also, how incredibly concerned Central Banks and governments are about deflation. Deflation, again, a very dangerous economic malady, and they will do whatever they can to make sure it doesn’t happen.
The best business plan, and why we want to be aligned with governments and Central Banks, is the best business plan for them – it’s inflation. That is what will also create the best investment returns for us with our income properties. Of course, if inflation doesn’t happen, as much as they may try, then it’s still pretty darn good – probably the best thing out there in the deflationary or stagnationary environment.
Anyway, let’s get to our caller, our listener, and you will probably see him at Meet the Masters. Here he is.
Hey, I want to introduce you to a prospective client who I’ve been on the phone with for maybe 10 minutes or so. He’s so interesting, I asked him to record with me and be on the show. It’s my pleasure to introduce Mark, and he has been listening to the podcast for – well, I’m not sure how long – and he’s talking to me from beautiful Switzerland. Mark, how are you?
Mark:
I’m very well, thank you, Jason.
Jason:
Good, it’s good to have you. Where in Switzerland are you located?
Mark:
I’m in the French speaking part of Switzerland, around Geneva.
Jason:
Fantastic, it’s beautiful there, what a gorgeous country. You’ve been talking to me about some really interesting stuff. Share with the listeners, just quickly, your background. It sounds like you’ve done very well for yourself and now you’re looking to real estate as your next investment vehicle, right?
Mark:
That’s right. Basically, I was writing financial articles in the stock markets, starting from the end of 1999. It seemed just common sense to me that it was not a time to be on dot coms. I started telling people that they should basically short the dot coms and buy some oil that was around $12 or $15 a barrel from the reserves.
Jason:
Wow, it’s amazing, I didn’t know it was that cheap!
Mark:
Yeah, I think so. I think gold was around 200/250, I think.
Jason:
240. Yeah, I remember that.
Mark:
To tell the truth, there’s some luck in pining as you know, but it has been…
Jason:
Just to give context, this is about 15 years ago?
Mark:
Actually, it’s quite easy. My first piece of advice appeared on November 11, 1999, so there was a bit of sweating on my side for a little bit less than 4 months. After that, it was pretty much easy sailing from there.
Jason:
Right, absolutely. OKay, very interesting. How long have you been listening to my podcast for?
Mark:
It hasn’t been that long, but I’m able to consume quite a lot of information so first I tried to look at different topics, so perhaps not listening to a full podcast, but I was hovering over the topics and then listening in-depth. What struck me is that few people seem to understand, or at least understand and express themselves like you do about the fact that right now would be an ideal time to work more on the liabilities balance rather than personal balance. Of course, we all love to buy stuff that goes up in value, but nowadays, when we have money printing happening in most of the world, when you have balance sheets growing at perhaps 30+% per year, you might want to or you might be able to grow your investments at 20+%. If it’s only that, you’re lagging or you’ll eventually be lagging.
If you align yourself with the Government’s interest or the Fed’s interest, then what you should have is basically fixed-rate debts long term and wait for the authorities to basically melt this debt away and let the currencies lose their purchasing power. You want to have something that is like gold or some kind of commodity – ideally something that pays you in the process.
Jason:
And in my eyes, it’s better than gold because gold is not multi-dimensional – it’s just one-dimensional. Income property’s multi-dimensional, so you know my thinking on that. Mark, I’m wondering – I’m just so surprised that number 1: we don’t have higher interest rates, and number 2: and this has only really been for the past year, but inflation really has gone down. It seems that it’s pretty subtle; the US is doing such a good job of exporting its inflation overseas – at least, that’s my theory as to what’s going on – rather than keeping it at home. it’s not very fair, but it is the way it is. It sure seems like with the spending, a lot of the inflation has to come away, right?
I just don’t know how it can’t, but I’m surprised that more hasn’t come already.
Mark:
There’s a lot of different products and services, obviously. We all know that government has been changing the way it accounts for inflation, but in truth, I think that if you just look at the Big Mac Index, you will see that in most of the world, it is basically keeping track with money supply, whereas some things are growing much faster – let’s say contemporary arts. The numbers are just sky-rocketing, so I think that we have a theory of two inflations where perhaps for the poorest people, it is getting really hard because the cheapest stuff is always worth more. We don’t even talk about the fact that now they have to put wood pulp and that kind of stuff in junk food because meat is getting too expensive. You have the poorest people’s inflation keeping track, you have the hedge-fund managers buying Professor Jeff Coombes Art that’s keeping track, and then in the middle there’s some lag or some inefficiencies like we have seen in the past in other examples.
Jason:
I certainly agree that the government understates inflation. In fact, I’m sure all governments around the world do that, but even with the government understating inflation, I’ve got to just admit – I don’t want to say it, but I think it’s still relatively low. It’s surprisingly low right now. I wouldn’t have said that a year ago because there’ve been some pretty significant increases – especially with food inflation, for the last couple of years before that. Like I say, maybe technology will just save us all from this massive inflation. If the inflation doesn’t happen in any major way, we’re still in the position where people.. If we don’t have inflation, the problem is going to be ‘Where do you get yield?’ I’m wondering if you agree with this, Mark. And then income property also performs very well. My strategy works much better in an inflationary environment, but it’ll still work pretty darn well in a stagflationary environment, or I should say stagnation, not stagflation. There is a difference. Even in a deflationary environment it’s not terrible, it’s not as good, but you know.
Mark:
You’re right. First of all, I would say on your earlier remarks – let’s assume that everybody agrees that government suppresses inflation numbers. It might be with the best intentions in mind. If they think that they’re preventing some kind of new Civil War among the people of a country, that’s perhaps worth it.
The second thing I would like to say is that obviously, we do live in different countries, you and I, so we might have different perceptions. I know that if I wanted to get the same prime cut of beef in the best restaurants of Zurich, I might have to pay a very different price than I would in an excellent restaurant in most of the United States.
Finally, the secret to investing, I would say, has a lot to do with what is the majority of the people doing – the majority of the investors, and what are you doing yourself. I think that the reason why I’ve been successful in the past is when everybody wanted to buy dot coms. Luckily, towards the end, I told people to do otherwise or to profit from the opposite happening really soon. I think that right now, we have a lot of people and a lot of investors – when they were in school, they were told that we live in a free market and that this is called Capitalism and that the most efficient people win etc. What we’re having now not only has nothing to do with a true free market, but we’re going the other way. We’re going from this idealistic free market to a more controlled economy. Perhaps it’s only the beginning. I think people are playing with the old rules, and those who have understood that the paradigm has changed and perhaps we need to do something that’s counter-intuitive, like being in debt. Obviously we’ve all been taught that’s a horrible thing. Maybe it’s those few early people who understand that and have witnessed that, so perhaps the people who are more sensitive to risk or more risk-averse, or I don’t know, the perfectionist. The canary in the coal mine, if you want. This is, perhaps, what you are and what you have been.
I am surprised, Jason, right now that basically what we are saying is not yet more mainstream. I’m not saying that this should be or should already be what everybody’s thinking, but so few people are thinking or are vocal about it. Perhaps it’s just well kept secrets and those who know it don’t want to talk about it.
I’m very surprised because this is so much against the mainstream of what you’re reading in the paper.
Jason:
Yeah, it sure is. They just want you to believe in the status quo, they want you to believe everything’s largely okay, while at the same time balancing that with the concept in the media of ‘If it bleeds, it leads’. They do like sensationalism, no question. Overall, the mainstream media – at least in the US, but probably pretty much around the world – is all so big and so corporatized, it’s just like Wall Street. They’re all in bed with the Government. It’s not just the US Government, it’s the global government. They’re in bed with the industrialized countries – all of them. I don’t know if there are secret memos we need to see or things like that, or if it’s an Edward Snowden type of conspiracy, or if it’s just the vibe, if you will, of that world where they know what they can say and they know what they can’t say. It’s hard to tell.
Mark:
I think it’s important to look at the numbers, and unless I’m sadly mistaken, I have double-check these numbers. The target viewship of CNBC have less than 300,000 people left watching them in the United States on prime-time.
Jason:
Wow, that is a low, low number.
Mark:
What I’m talking about is that when you board a plane anywhere in the world, you still get the Wall Street Journal, you still get the Financial Times. Even if you have the International Herald Tribune, you will get several of the most important pages of newspaper dedicated to Wall Street. What I think is fascinating is that you’ve got this old order where they have changed nothing. I wish I could say they’re still using fax machines, but I’m thinking more about Flintstone type of tools. Things have changed. There’s nobody left to watch this stuff, there’s nobody left to read this stuff.
Jason:
It just makes me feel so good that the alternative media has gained such a foothold, whether it be podcasters or bloggers, because I’ll tell you, no-one is telling me what to say, and I love that. Maybe I’ll have a knock on the door at some time where they say ‘Hey, you can’t say that’.
Mark:
Jason, are you telling me you’re for real? I always thought you were some sort of hologram controlled by Washington or the CIA.
Jason:
Well, you know, even the crooks and the conspirators say they’re for real, too, so maybe I’m not! Maybe I’m just bought off by some group, maybe Fannie Mae owns me. You haven’t heard their commercials on the show, right? Funny stuff. Hey, what are your plans for your real estate portfolio, Mark? What are you thinking of doing?
Mark:
I realized already at least 3 years ago, perhaps more, that despite the real estate prices after Subprime lending in the United States, the housing affordability, if you go to certain sites that will give you in any country or city of the world the affordability numbers, you still have like 80% of the most affordable regions which are in the United States. In addition to that, there’s a developed professional mortgage market in the United States which obviously is not the same as it used to be during the biggest boom.
Jason:
It’s the most developed mortgage market in the world, and that really really says great opportunity. Real estate in the US is just better than anywhere else I can find. It’s less expensive..
Mark:
Jason, I wasn’t finished because I was going to say look at all the countries in the world – I can tell you about Geneva where I have family who own buildings where it can take years until you evict somebody who never paid you a cent for the rent.
Jason:
Unbelievable.
Mark:
And I haven’t started talking about the rent prices being controlled in some regions or countries.
Jason:
In Germany there’s big rent control.
Mark:
Yes, so you have to look at all that and then say, okay, and then to tell the truth, there’s just the money creation. Actually, I have profited already in Switzerland because the Swiss national bank’s base money has grown faster than the Swiss GDP. They have been printing in one year more than Switzerland has produced in GDP. Basically, you could say that all the GDP could have been created with just fake money printed and the Swiss, unfortunately, just ..
Jason:
That’s just mind-boggling. Isn’t that mind-boggling? That’s worth repeating, Mark. They printed more than the GDP of the entire country?
Mark:
So instead of having anybody working a single minute for a whole year, they could have just used the money that was printed and no consequences, so far. The thing is that it is mind-boggling, but it is also, Jason, you have to think – most of the investors whine: ‘Why did I not win the lottery?’
Here, we have for certainly the first, but also perhaps the last time in our lives, a global paper money bubble and perhaps when we look back in 20 or 30 or 50 years, our kids will tell us ‘You saw that happen, and you did not take advantage of that?’
Jason:
They might first say ‘You didn’t do anything to stop it?’ but then the second thing would be ‘You didn’t take advantage of it?’
Mark:
Jason, let’s address this. How do you stop it?
Jason:
Through Government, through voting, for people who will stop the spending and pay down the debt and so forth.
Mark:
I did vote in favor of the initiative encouraging or forcing the Swiss National Bank to buy gold and to stop printing, but obviously I was in the minority.
Jason:
Yeah, well that’s no fun, why would anybody vote for that? It’s too logical!
Mark:
One question: Are we past the point of no return? Suppose that you’re a kid and your father is an alcoholic and he’s beating up your mother. Then you have two possibilities. Either you lead your Dad to the path of sobriety, and there’s some amount of work for that to happen. Or you serve him another glass of whisky and perhaps he takes the car and kills himself. If you really want this to stop, you have to make a conscious decision of whether the shortest way is solution number one or solution number two. Obviously, I would not be a good Christian if I choose solution number two, but assuming that there’s no moral dilemma and it’s just about efficiency and hurting the least people possible, I feel that it is best to help our government, which is basically to use the debt and to use the paper money that they are creating to profit from the money printing happening, which is exactly the same as telling the drunk guy that he should have another drink.
When all this collapses, what happened in Iceland? Did you realize that in Iceland, thousands of people have just had a jubilee where the amount of their mortgage has been reduced.
Jason:
The debt jubilee, yeah.
Mark:
It has been reduced by tens of thousands on the amount that they owe. Would you rather be the guy who now has less debt for nothing, or would you be the guy who pays for this other guy who has less debt?
Jason:
Very, very good point. Well, we’ve got to wrap up so I want to have you finish that point, if you would.
Mark:
I’m just saying, perhaps the easiest way right now is because we’re past the point of no return, perhaps the shortest way to the next solution and the new, better equilibrium is to just help our governments spend and get in debt and destroy the money supplied faster with us being lenders. We will profit from that, the people who are saving, who are putting their money aside, they will be losing and that’s perhaps a sad conclusion, but perhaps this is the shortest path to the next, better equilibrium.
Jason:
It might be, and it might be just a re-balancing, and I think you’re right in that being in debt, as long as it’s long-term, fixed-rate, investment-grade debt attached to commodities that are needed the world over by every human being, that’s the ultimate strategy. Inflation, deflation, stagnation, whatever, it’s going to be the best strategy.
Mark:
And let me tell you one last thing, since we don’t have so much time left. I also had quite a lot of success in the stock market buying companies with net-tangible assets of let’s say $100 million and a market cap of $50 million. I knew that eventually, either a rate comes or..
Jason:
And they split it up.
Mark:
Or a nice premium. What you find now in some areas of the US real estate market is properties at a fraction of replacement cost, and it is exactly the same situation. Actually, you perhaps don’t know it, Jason, but you’re just like a rater.
Jason:
I’m a corporate rater, like Ivan Boesky.
Mark:
Exactly. You’re the modern Ivan Boesky and you’re basically scooping up these assets at a lower than replacement value or replacement cost, and you’re profiting from it.
Jason:
And that is the idea, my friend. I think that’s a really good strategy for all of us, so let’s keep doing it. Let’s actually do it faster and do more of it. Good stuff. Thank you so much for just coming on the show, Mark, as an impromptu guest like that, I really appreciate it.
Listeners out there, I was talking with Sarah about this recently – we would really love to have more listeners on the show. If you want to be on the show, if you’ve got a question, if you want to talk about an issue, all you need to do is just go to www.JasonHartman.com/Jason, so that’s easy to remember, right? Pick a time and we’ll record and we’ll have you on the show.
Thank you so much, Mark, for joining us. I appreciate it and so do the listeners.
Mark:
Yes, and for your listeners, I can confirm and I can vouch for Jason – he’s as punctual as a Swiss.
Jason:
Well, you were the one who called me, so you were the punctual one. I just happened to answer. But I do like Swiss watches! Good stuff.
Outro:
This show is produced by the Hartman Media Company, all rights reserved. For distribution or publication rights and media interviews, please visit www.HartmanMedia.com or email [email protected]. Nothing on this show should be considered specific personal or professional advice. Please consult an appropriate tax, legal, real estate or business professional for individualized advice. Opinions of guests are their own and the host is acting on behalf of Empowered Investor Network Inc. exclusively.
