ANNOUNCER: 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 property 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 three hundred and fifty-three. Thanks so much for joining me today. Today our guest will be John McAfee. Now, you’ve probably heard that name. In fact, it’s probably been on your computer, it may be on your computer today. And that’s because he is the world-famous billionaire security expert. And he has created a software company that went public, and he tells the story about that here on the show. And just a really fascinating guy, and a fascinating story. But, if you’ve been listening to some of these other promoters and gurus out there, be extremely careful, because they’ve been recommending things like investing in Belize or Nicaragua or some of these crazy places. And I’ll tell you, I’ve been to Belize twice. I just got back from Jamaica a few, a couple days ago actually. And I think that it was my 71st country? Yes. My passport has more stamps than the post office [LAUGHTER]. But it may have been my 70th country, or 71st, I’m not sure. And some countries I’ve been to several times. I’ve been to Belize twice, and with all this talk about investing in these great places, you look at the pictures…the reality is nothing, nothing like what the promoters say. You’d better go, and you’d better take a close look at the daily life in some of these, frankly third world countries. I mean, it is really unbelievable. There’s no rental market to speak of; there’s not gonna be any cash flow. There’s no infrastructure, there’s no MLS system, there’s no comparable sales data, so it is very, very easy to get burned and screwed and always look at things like this. If the bank won’t finance it—if they’re too careful to finance it—you should really think twice. I ask you to look at this example in the arena of automobiles. Yes, Tesla, that is what I’m referring to. I think Elon Musk is a fantastic entrepreneur. He’s the founder of Tesla and many other ventures. He’s a very interesting guy. I’d love to have him on the show as a guest. He’s doing some great things. But I don’t know if Tesla’s gonna be the success everybody thinks it’s gonna be. Because anything that has to be highly and heavily subsidized by the government, and can’t survive on free market economics, is in my opinion destined for failure. That includes Fannie Mae, it includes Tesla, it includes, gosh, what else. There are so many things. It’s 11:20 PM and I can’t think of them right now, I’m a little tired. But I had to get this intro done for you. So anyway, look, you’re gonna hear John McAfee talk about his experience in Belize. It’s gonna raise the hairs on your neck. So, be really careful of this stuff, folks. We could easily be promoting this stuff. I mean, I can’t tell you the number of people who have approached me—developers, promoters, and said, hey, I used to get I don’t know, a couple calls a week from people who wanted me to promote their properties in Costa Rica, offering very good sums of money if they could come and speak at our meetings and get on my shows and talk about that stuff. Belize, same story. And I don’t know, I’ve talked about this extensively on prior episodes. But I’ve looked at properties in almost every country I’ve visited. I’ve gone around with brokers. They’re unlicensed people, and I, again, having this libertarian bent—I’m not saying that licensure is really the right way to handle industries, but I am saying that in these third world countries—and they are third world countries—don’t be deceived. It’s the Wild West. There’s just no real infrastructure. It’s a mess. I’ve looked at a couple of these foreign countries that I’ve been close to liking and promoting, but still have never done it, because I just don’t think it’s good enough. I think the good old US of A really offers the best properties, and the best system, and the best infrastructure, and I certainly have my criticisms of almost everything in America nowadays. In fact, you know what one of my sayings is? Because I’m so disappointed in our government, and the NSA scandal, and these constant, constant never-ending intrusions on our freedom. And speaking of which, aren’t you glad to see—I just read a story today about all of these famous writers that formed a group of like 562 world-famous authors that are circulating petitions and signing them about the NSA and telling them to stop snooping. Several of the major tech companies got together, and they say they’re against the NSA snooping. I don’t know if I believe that one. Seems like window dressing to me, because they’re really part and parcel of the whole NSA. And I don’t know, I’ve done shows on Google, and interviewed the author of a book entitled Search and Destroy, about how Google—and this was before the NSA scandal, thank God for Edward Snowden exposing that one, and thank God for Bradley Manning exposing the things he did. This is what we gotta do. To maintain liberty, we’ve got to be constantly questioning authority, and question our government, and not accept their propaganda as truth. And so, you know I’m very critical of America, my country. But at the same time, I always say that I think America has a long way to fall before it’s really as bad as some of these other countries that promoters are telling people to buy up real estate in, and have these investments. And I just think they’re just conning people, is what they’re doing. So…. Be careful. And you’re gonna hear some of that from John McAfee today. Not as a real estate investor; just as a person who went and lived there. And how poor the legal system and the justice system is, and the infrastructure. And how you just don’t have the rights you have in more developed, modern, western countries. Anyway, so, you be the judge. But it’ll be an interesting interview nonetheless. We are not too far—let me see. We’re a little more than a month away from our Meet the Masters event in Irvine, California. We’re selling pretty quickly on the tickets. We’re in the conference center, so the size is limited. But there’s still some space left, so get the tickets while you can. You’ve still got some early bird pricing. Go to www.jasonhartman.com for that. Check out some of the great properties we have. And also, I want to say that some people have asked why we’re not promoting Austin, Texas lately, which is a market I do like quite well. We are getting rather disappointed in our provider there. So, we’ve I don’t know, we haven’t officially fired that provider yet, but I think we’re going to. And I would just say, if you’re looking at properties there, make sure you talk to your investment counselor at our company. The main number is 714-820-4200. Of course, you can contact your investment counselor if you’re dealing with them directly at their email address, which you probably already have, or their direct number, or through the www.jasonhartman.com website. We’ve just been from time to time—I’d say that, gosh. If I had to put a percentage on it, it’s kind of like saying, is your family dysfunctional? Well, every family’s dysfunctional from time to time and to some degree or another. Even the best families around, or best families in the world, with these idyllic parents and children and they’re all a little bit dysfunctional from time to time. Well, some of our providers are too. But I’d say about, maybe 15% of the time we have to really take issue with one of our providers, and it’s kind of getting that way with our Austin provider. So if you want to find out more, contact your investment counselor. But we sure like our Houston provider, I’ll tell you that! And our Memphis providers have been doing a great job. Great job in Little Rock as well, and Atlanta, a perennial great. Indianapolis we’ve got a couple of different local market specialists there, who we like and are working with quite well. We just constantly monitor our client experiences, and we want to give you that feedback. It’s not just with the provider, it’s with the market as a whole, and remember, when you invest in properties, there are multiple markets. In other words, there are multiple dimensions to your investment. So you’ve got the sales dimension—what’s happening with prices. Are prices up, are prices down? Is inventory up? Is inventory down? What’s the quality, the age of the properties, what is that all like? But then you’ve also got the rental market, which is a separate dimension, and many times, a non-correlating dimension. Actually, a counter-cyclical dimension to the for sale market or the price market, where if you have a softer sales market, you might actually have a better rental market. As long as the population is increasing, because if the aggregate population’s increasing, that is always a good sign, as long as those households aren’t doubling up. So, there’s a lot of complicated factors that we’re constantly looking at, analyzing, and evaluating. But again, the most important thing we do, which is more anecdotal than it is empirical—because we’re checking the empirical things too. We’re looking at data, we’re looking at housing starts, we’re looking at vacancy rates, rental market and property supply, and what developers are doing, and reading surveys constantly, and just endless articles and so forth. But, the best knowledge of all comes from what we call the ground troops. And that is—you know, the more anecdotal information that we just glean by talking to people constantly. We’re talking to the local market specialist, we’re talking to other market specialists that are maybe not in our network, and we’re not giving business to and referring clients to, but they want to work with us, and they’re talking to us. We’re kind of vetting them and talking to them and listening to their pitches all the time, and we’re talking to property managers all the time. We’re talking to lenders, people in the industry, and just kind of evaluating all that information, and then feeding it back to you—potential clients and investors in a given market. So that’s what we do, that’s what we’re here for, talk to your investment counselor, listen to the past episodes and keep listening to the future episodes for more—a lot of great stuff. And just to mention about our last episode with Harry Dent, I recorded that I guess about two months ago. It went up right away in the members section, and again, a membership is only 120 bucks a year, or 10 bucks a month. What’s that, about 33 cents a day. That’s actually a sales technique I’m using on you right there, it’s called reduction to the ridiculous [LAUGHTER]. So, become a member for only $120 a year, or 33 cents a day approximately, and you’ll get discounts on events and products and so forth. Usually those run about 20%. They’re not on everything. But there are some great discounts. And members only conference calls every month, and just some great stuff. Stuff in the archives there that you’ll really, really enjoy. And members only podcasts as well. But when I record that, I sort of forget about what the speaker said, and then I do the intro for that guest, like I did for Harry Dent, and I listened to the show after it’s published and then I think gosh! I should have mentioned this in the introduction and so forth. But it was really interesting to me how Harry Dent—one of the very few deflationists out there. These big name deflationists, most people think we’re going to have very significant inflation. I’m one of those people. But again, it’s spotty. It depends on the asset class, and it depends on whether you’re talking about assets or you’re talking about monetary inflation. Over this past cycle, in the mortgage meltdown and the financial crisis, when all the Wall Street crookery was just exposed en masse, we saw a situation where we actually had asset deflation, but we had at the same time monetary inflation. Well, what does it mean? That sounds like a lot of econ speak there. And I love what people say—that economics, as an art or a science, was invented to make astrology look respectable [LAUGHTER]. So, that’s kind of true. So there’s a lot of factors to look at. A lot of gobbledygook and jargon to sort through. But basically what that means is, it indicates a lag time where you can have assets, especially credit-based assets, devalue. They can deflate in price. And we saw that with real estate, we saw it with stocks. We saw it with pretty much every major asset class. But then they started to inflate at different times in different ways. And so, first, right after Obama was elected the first time around, and unfortunately then for our country I say, and then the second time to add insult to injury [LAUGHTER]. So, we saw the stock market got pumped up right away, and it took a couple years for all of this quantitative easing—another BS term they use. We’ll just call it money creation. Or currency creation. And we saw that it took longer for that to hit the market. And when it did, and it certainly has, as we’ve noticed—a good $5 trillion or so. And it’s not just in pure money creation! That again happens in different ways too. It happens in easing of bank reserves, and in easing of credit. So, there’s the money supply, and then there’s also the credit supply. MS would be money supply, and CS would be credit supply. So, these all happen in different spotty ways. We all know this. And so, this causes things to inflate and deflate differently. But Harry Dent’s predictions—they were amazing! And you know, he’s been spectacularly right and spectacularly wrong about some very, very fundamental things in his predictions over the years. And you know, he’s pretty honest about that. Certainly the Dow did not go to 30,000 as he predicted many, many years ago. But heck, Peter Schiff predicted gold at $5,000 by the end of Obama’s first term. I find that one to be pretty hilarious. And, it’s amazing how often Peter Schiff is wrong. But, when they’re wrong it doesn’t get publicized too much. And I’ve been wrong about something that’s pretty major too, and I like to admit that constantly. I’ve been right about pretty much everything except interest rates. I thought interest rates would be much higher by now. But again, this is what happens when you have government intervention. It defies gravity. It defies the laws of economics. It doesn’t make any sense. And that’s what really nobody can predict. So, what was I saying there? Gosh, it is late, isn’t it. But oh yeah, Harry Dent, his predictions. So on that last episode, on episode number 352, he was talking about the Dow dropping. I mean plummeting. A complete crash. The Dow Jones Industrial Average, going to what, 3300, I think he said? Gold plunging in price to $750 an ounce, and then after that barrier, it would plunge again to I think, what did he say, 2 or $300 an ounce. He said that real estate would drop in price too, but then, when I made him clarify his generic term of “real estate”—you know, I love when these gurus talk about “the housing market,” as if there is any such thing as a national housing market. Because that divides up so many ways. And you know, look. This doesn’t happen with the Dow Jones Industrial, it doesn’t happen with the S&P, it doesn’t happen with gold or silver. Those are what they are. The spot price of gold is the spot price of gold, period, end of discussion, at any given time. The spot price of silver is the spot price of silver, period, end of discussion, at any given time. The S&P 500 index is the price of the S&P 500 at any given time. Same goes for the Dow Jones Industrial Average, okay? Same goes for the price of any particular stock, like Apple stock, right? The price is the price. But housing? Way more imperfect, and way more complicated. And in my opinion, way more wonderful, to use a surfer-ish kind of way to say it. Way more, dude [LAUGHTER]. Wow, you really can tell it’s late, the way I get so casual here. You know you have to divide real estate by geography, of course. You have to divide it by price segment, by housing type, by neighborhood, by submarket, by micromarket, by neighborhood, by one house next to the other house could be a totally different story. So, all of these things, there’s so much that goes into that equation. But when I made Harry Dent really parse up his statement about real estate going down in value, he completely agreed with me when we talked about cost of construction! We talked about properties that give cash flow. And he basically said, in not so many words—but I brought up the concept of TINA, T-I-N-A, that acronym—There Is No Alternative, or there is no better alternative. And where are you going to get yield? You’re not going to keep your money in the bank and get any yield. Really there’s only three opportunities to get any reasonable yield that is pretty reliable and predictable. Number 1: own income property. Good income property, the type of stuff we recommend, and good markets with good cash flow. Not being a gambler, not being a speculator, betting on any appreciation. Again, prudent investors invest for cash flow. Just ask Warren Buffet. That’s the concept of value investing, a very prudent way to invest. So that’s one. Income property, certainly my most favorite of all. Number 2: private lending. And you can do that through our network. So you can be a private lender, and you can lend money on real estate deals, and get a pretty good reliable predictable yield if you’re careful. Again, I’ve never been burned on one of these private loans as I’m recommending and talking about now. So that’s number 2. What’s number 3? Number 3—actually, those are the only two. Because, I said reliable and predictable. But I will give you my number 3 that I was thinking of when I said that, although it doesn’t really fit. And that is invest in the business that you own and you run and you determine what happens. Rather than going out on Wall Street and investing in somebody else’s business, invest in your own! Nobody cares about the shop more than the shopkeeper. You’re the shopkeeper, so you care more. Why would you be investing in someone else’s business, with all these layers of people skimming money off the top? And usually they’re a bunch of self-serving crooks, in my opinion. So, the Wall Street industry, what I call the modern version of more organized crime. Not to mince any words there Jason, that’s just my humble opinion, based on that experience. And a lot of reading, and a lot of listening to news. Why invest in someone else’s business? Invest in your own. If you’ve got your own business, that’s where you should be putting your money—into something that you understand and you control. And the same is true of course with income properties. However, the business that you invest in—that’s—you gotta be lucky, talented, well-capitalized. You gotta have a lot of stuff going for you in business. You’ve gotta be smart, you’ve gotta be ambitious. That involves a lot of real 60-hour-a-week, 80-hour-a-week, 100-hour-a-week work, to have a successful business. And investing is not a passive activity, but it’s much more passive than obviously owning and running a business. If you do like businesses, invest in your own! Not somebody else’s. Okay? So, some really interesting things, if you haven’t listened to the last episode yet. If you’re skipping around or you’re a new listener, go back and listen to that one. And go back and listen to 351 episodes before that too, you’ll really like them. Anyway, without further ado, let’s get to the very famous, and very insightful, John McAfee. So we’ll be back with him, our guest today, in just a moment.
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JASON HARTMAN: Be sure to call in to the Creating Wealth show and get your real estate investing and economics questions answered by me personally! We’d love to have you call in, share your experiences, ask your questions, and a lot of other people listening have those very same questions. So be a participant in the show! At 480-788-7823. That’s 480-788-7823. Or, anywhere in the world via Skype: JasonHartmanROI, that’s JasonHartmanROI, for return on investment. Be sure to call into the show. And we are going to enter all of the callers in a drawing for some nice prizes as well, so be sure to call into the show, and I look forward to talking with you soon.
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JASON HARTMAN: It’s my pleasure to welcome John McAfee to the show. If you think that name sounds familiar, you’re probably right. In fact, you’ve probably owned his software at one time or another in the past. He is the guy behind the very famous antivirus software. And a lot has been going on in his life lately, and he’s got a very interesting solution to some of the problems we are all facing—really, the oppression we are all facing from Big Brother. Big Brother at the NSA, the National Security Agency, and we look forward to hearing more about it. John, welcome, how are you?
JOHN MCAFEE: Well I’m fine, thank you Jason, and thank you for having me on your program.
JASON HARTMAN: Yeah, well, it’s a great pleasure, thank you for joining us. First of all, just tell people a little bit about your background and your rise to—really, incredible success with your software.
JOHN MCAFEE: Well, I’ve been a software engineer my entire life. Started out in mathematics at school, and software’s nothing more than applied mathematics. And I’ve always had an easy capacity for programming, it comes easy to me, and my mind integrates it well. So, when computer viruses first came out, it was very easy for me to see how they worked and to see how it would be possible to circumvent them. I worked on the program, and the rest is history. McAfee was formed, and it became the largest antivirus product in the world.
JASON HARTMAN: Wow, that’s amazing. And so what years—was that the ‘90s pretty much, or the ‘80s?
JOHN MCAFEE: Well, let’s see. I started programming a long time ago, back in 1968.
JASON HARTMAN: Wow! [LAUGHTER]
JOHN MCAFEE: I’ve been doing this my whole life. I’m probably older than you think I am. I’m 68 years old.
JASON HARTMAN: Just as a perspective—1968, so, that was on cards, right?
JOHN MCAFEE: That was on cards, absolutely. I worked at NASA’s Institute for Space Studies in New York City, and it was a card system, punch cards. And if you happened to drop your box of cards, that ruins your entire week. So, yeah. I cut my teeth on that, and 20 odd years later, computer viruses came around, and I was perfectly positioned to take a look at them and try to combat them, and it was a very exciting time for me.
JASON HARTMAN: And so, you probably raised money? You got—your company was giant, I mean, can you give us some perspective on the size of the software company that you created?
JOHN MCAFEE: Well, you know, it sold last year for $8 billion to Intel.
JASON HARTMAN: Wow.
JOHN MCAFEE: Headquarters in every country in the world. Many thousands of employees. And still a powerhouse in the field of computer security.
JASON HARTMAN: And so that’s $8 billion with a ‘b.’
JOHN MCAFEE: Yeah, with a ‘b.’
JASON HARTMAN: Okay, so now what has been happening to you since then? Did you retire after—I believe, I could be wrong here—did you sell to Symantec initially? Someone bought you out, right?
JOHN MCAFEE: No, no, no. I went public. I took the company public in 1991, and then the company was so huge by then that I just got bored. I hired a CEO who was the executive VP from IBM to replace me, and wandered off into the world. But I couldn’t stop working. I immediately started another company called Tribal Voice that I sold to CNGI for $17 million, and then got involved with Zone Labs, which we sold to CheckPoint for $400 million. And then I went to Central America and dabbled in a number of different companies. None of them was technology-related except for the antibiotic company QuorumEx. I just can’t keep still. I can’t keep my fingers out of building businesses, or out of technology.
JASON HARTMAN: Yeah, well, that’s great! I mean, you’re a creative person, and you’ve gotta do something and build something and develop something and share that creativity with the world! And obviously the world has responded very well, because you’re a tremendous success, so…it’s good that people like you keep working and don’t just retire! But what has happened to you? There have been some issues with government and Belize, and…give us a little bit of that story? And that’ll lead right up—I think it’ll be a good segue as to what you’re doing now.
JOHN MCAFEE: Well, in Belize I started a number of companies, most of them very small. I had a ferry business for the island of San Pedros so that tourists and locals could get back and forth across the island easily. I had a water sports business, a flying business. I started a coffee business. And even a cigar business. I smoked cigars for a while. And then I got involved in antibiotics using native plants, and the new technological concept called quorum sensing, which is really nothing more than bacteria’s ability to communicate among themselves. It’s a brand new concept, we didn’t even know they communicated until about 10 years ago. Poured a lot of money into the development of the lab. But working in the jungles of Central America in a high-tech environment is not the easiest thing in the world. Clean rooms just don’t stay clean. Employees just don’t show up to work. Every problem you can possibly think of. And the idea of hiring from other countries, it sounds pretty easy, but every time someone would come for an interview, they would look at the facilities [LAUGHTER]. No electricity—well, we had electricity in the lab, but no internet, the town had nothing. No movie theaters, no restaurants; very sparse living, and people simply decided not to do it. So it was difficult to attract talent, and the talent that was there simple was operating on Central American culture and time, and basically it just was not going to work. At about that time, by the way, since I had moved to the jungle I was the only westerner who lived in the entire district of (unintelligible), it was 15,000 people, the only white man. The locals treated me like a local. If you have money, you have to give it to the political party in power. So they came and asked for $2 million, I said no, the following week they raided my property, destroyed my lab, shot my dog, and then said, you sure you won’t change your mind. At that point I went to the international press, I talked about all the corruption, and that began my war with Belize. And I stayed for another 10 months, up until the time my neighbor was murdered, and they wanted to question me. Well, in Belize they can question you and hold you for as long as they want. Well, for 60 days. And at the end of the 60 days, they can renew that for another 60, without any charges. So, I could be in prison for 50 years awaiting questioning.
JASON HARTMAN: When you say they wanted to question you and hold you for 60 days—so, they were thinking, or saying, I should say, that you were responsible for your neighbor’s murder?
JOHN MCAFEE: No, not at all. They questioned all the neighbors. But I had been at war with them, and they were looking for any opportunity to shut me up. And putting me in a jail, that certainly shuts me up.
JASON HARTMAN: Yeah. Right.
JOHN MCAFEE: I cannot talk to the press if I’m in a jail. And that’s all they wanted. I knew that’s all they wanted, so I was not about to allow them to question me like they questioned the others. They were after me. And so the next thing is, I’m in Guatemala. I entered Guatemala illegally, was jailed in Guatemala, Belize requested that I be extradited back, and instead Guatemala sent me home, here to America.
JASON HARTMAN: Wow. Wow, that’s just something else. Just before we go on, John, I gotta mention—I’ve been to Belize twice, and I host another show called the Jet Setter Show where I talk about different expat opportunities. I think it’s wise to have a plan B. We look at all the stuff the government is doing here in the US nowadays; maybe it’s not a bad idea to have a second home, or a second passport, or both. And, I’ve been keeping track of these international real estate markets for many years now. I have a real estate company that helps investors buy properties all over the US in different cities, and you know, that’s been a great business. I love real estate. Been in it all my life. And I went to look at properties there, and I gotta say, it’s so primitive! I just don’t see the appeal! I mean, I can’t get a consistent internet connection. It’s a lot of the stuff you said, and I wasn’t even running a business! I was just trying to email home! It won’t let me use Skype—the phone company suppresses Skype—
JOHN MCAFEE: The phone company was nationalized. Here’s the other thing: five years ago they took away the phone company from Lord Ashcroft in England, who had a really decent phone company. They refused to give it back even after the High Court said give it back. And then, they just clamped down. They don’t want you using Skype because they don’t get to take your money. So, it is tragic beyond belief. But you’re right, it’s very primitive. However, the reefs, the seacoast, and the jungles are the most beautiful on the planet. So, nothing is perfect in life.
JASON HARTMAN: Right, right. It’s just something else though. I think that all these people that are looking to retire in a lot of these places, whether it be Belize or South America, Panama, Nicaragua—I think they really got a rude awakening coming their way. Because it’s not what it looks like when you read those magazines, and all those email newsletters that are sent out by these great promoters. I mean, I’ve been to 69 countries now, and I gotta tell you, some of these places are really pretty primitive, it’s amazing. The real estate probably isn’t worth a third of what they’re selling it for in a lot of these areas. But that’s kind of a little tangent there, but I wanted to throw it in. If you have any other comments on that I’d love to hear them.
JOHN MCAFEE: In the third world, just beware. There is an ingrained system that everyone understands except us, because we live in a system of laws and justice. Sometimes at least. The appearance of laws and justice. But down there, there’s not even the appearance. It’s run by pirates, and everybody knows it’s run by pirates. You pay your dues. And if you don’t pay your dues, you get punished.
JASON HARTMAN: So probably the best thing to do, if you ever go to or move to some of these places, is just fit in. Pretend that you don’t have any money so they won’t come and hit you up, right?
JOHN MCAFEE: That’s basically it. Keep a low profile, don’t let anybody know your name, if you have a name that’s recognized. Don’t display money, don’t display wealth, don’t buy new cars. Wear ragged clothes and you’ll get along just fine.
JASON HARTMAN: Yeah, and who wants to do that? That doesn’t sound like that much fun.
JOHN MCAFEE: It isn’t that much fun, I can assure you.
JASON HARTMAN: Okay, so, were they trying to murder you and just do away with you in Belize?
JOHN MCAFEE: I don’t know. They were certainly trying to shut me up. I had a blog, I was shouting out on the blog every single day about corruption and murder and mayhem. Belize is the murder capital of the world, statistically. And it truly damaged their tourist industry. And Belize—tourism accounts for 70% of the Gross National Product. So I was harming the country dramatically. And they didn’t like that. They just wanted me to be quiet. But I didn’t want to be quiet! I wanted an apology! Good lord, those people came in and shot my dog, destroyed my property, kept me in the sun handcuffed. All I asked for was an apology! Apologize! Be a mensch! But no, the prime minister refused. So, I did my campaign. It was a very foolish thing to do; I don’t advise anybody else to follow my footsteps.
JASON HARTMAN: Yeah, you know, the government has unlimited resources. Of course, the US government especially. But other governments too, and you can’t fight a government. They’re just too damn powerful. When you control the laws, it’s like controlling the air supply.
JOHN MCAFEE: Of course.
JASON HARTMAN: Well, so what did you do next? You were kicked out of Guatemala, you were sent back to the US. And where did you move in the US? Were you New Mexico or Arizona or something? Or where?
JOHN MCAFEE: Well, I was in New Mexico. I’ve lived all over the US, but when I came back I went to Portland. Portland, Oregon. It’s about as far away from Belize culturally as you can ever get, and so it gave me some respite there. And then, I just began working on technology again. And as I was working, the technology just became timely, with Snowden and the NSA, and our privacy leaks, and then the sudden understanding—I had known for years that we don’t have privacy in this country, but the general populace now knows it, and that’s spooky. People don’t want their privacy barrier broken. I’d like to close my door, and what I do behind my closed door, if it hurts no one else, it’s none of your business. But unfortunately, that’s not the world anymore. And so, now I think it’s probably my last major battle—my last campaign—I want to do something about it. I want to bring sanity back to the world!
JASON HARTMAN: Well okay, so, what do you have now? What is this—well, first of all, maybe let’s talk a little bit about the problem for just a quick moment here. Everybody knows about Edward Snowden. Everybody knows about Bradley Manning. The US doesn’t like people telling other people about its dirty deeds, do they?
JOHN MCAFEE: No, they absolutely do not! And the US doesn’t like people knowing that they know everything. I mean, for example, if we had—if the administration had publicized the fact that the NSA is snooping around in all of our phone records, we would have been outraged. So it hid that fact from us. But you can’t hide things like that forever! You simply cannot. And now we found out, and we are outraged! If you’re snooping in my phone records without court orders, without anything, and you’re trying to find out who our friends are through Facebook, and why we’re friends with them, and what connections we have? Good lord, this is 1984 times a million!
JASON HARTMAN: I mean, it goes right in the face of everything that our founding fathers put in the Constitution to protect us against intrusive government! The freedom of association, the freedom of speech is being restricted dramatically. Police are taking peoples’ cameras away. Apple just recently patented a technology that allows them to shut off iPhone cameras remotely! Makes me want to go out and carry a second camera with me all the time. Maybe use good old film, something that they can’t do anything to.
JOHN MCAFEE: Right. And it’s getting worse by the day. The more we depend on our electronic systems to support us and provide information and communication, the easier it is for the government to know everything about us. Without privacy. I mean, not that I’m doing anything wrong—it frightens me from a social and cultural perspective. Without privacy, we are nothing! We are nothing! We become cogs in a wheel.
JASON HARTMAN: You are absolutely right. And here’s the scary part about it. It may seem innocent enough now that this huge data center in Utah is just accumulating information, just mega-terabytes, I don’t even know what they’re called past a terabyte. You probably do. But just incredible amounts of data. And we don’t know what that might data might implicate any of us in 10 or 20 years from now!
JOHN MCAFEE: That’s the whole point. And the weird thing is, they have brainwashed—I was just talking to a friend a moment ago about secrecy. And it’s like, some people just don’t get that without secrecy we aren’t individuals. We’re not human beings. And the government wants us to believe that, and wants us to understand that. And so, it’s frightening what has happened to us, and it’s frightening what we have become as a society and as a culture. It’s like—I don’t know what to say about it! It boggles my mind. I mean, can you imagine Benjamin Franklin sitting around somewhere, and somebody telling Ben Franklin, you know George Washington is reading everything you write? What would happen? Ben Franklin would take a gun and shoot old George Washington, wouldn’t he! But now, we take it for granted. Oh, we don’t need secrets. Of course not. But without secrecy, we have nothing! We are not people, we are not human anymore! And people are starting to see this now. When I say this, they go wow, you’re right! But certainly—when did we lose this perception?
JASON HARTMAN: It’s really amazing, it really is. But can I ask you one question, just to keep this in perspective? The thing I like to always say is, compared to what? When you tell the story—the terrible tale of Belize, and yes, the US is going in the wrong direction, God we know this. But what I see though John, is, I think the US still has a long way to fall before anything else looks much better. In comparison. You know, you just—
JOHN MCAFEE: How much further can we fall? Aren’t we near bottom? I mean, if we’re not near bottom, I don’t want to—I do not want to contemplate what bottom is. If this culture and this society have sunk so low that basic human principles are no longer valued, I don’t want to live in it.
JASON HARTMAN: Yeah, I agree with you, but where are they valued more? That’s the question! You gonna go to Russia? You still live here. I still live here. Where are you gonna go? What else are you gonna do?
JOHN MCAFEE: That’s a good question. I do not know, sir, I do not know. My hope was that somewhere in Asia, but I don’t think so. China has done the reverse. China wants everyone to think exactly alike and dress exactly alike. And individuality is discouraged. And so is privacy! So, I don’t know. But I’m doing my part, and I will stand up for people, because we the people have done this to ourselves, do you understand? We have done this through apathy, indifference, and fear. And only we can fix it. Here’s the issue: VOTE! You are lucky Americans, you can vote. All of you. Recall these people! Throw them out of office! Start something new.
JASON HARTMAN: Well, what solution, in terms of technology, do you have? Tell us about your gadget. Do you have a name for it yet?
JOHN MCAFEE: Yes. It’s D-Central.
JASON HARTMAN: Okay, D-Central. So, what does D-Central do?
JOHN MCAFEE: D-Central takes your cell phone, or your smart phone, your iPad, your laptop, whatever. And turns it into two different devices. One, the thing it’s always been: you can connect to the Internet, you can do your emails, you can do whatever you want. Get on Facebook. And the other, we have an application where you can press the button and suddenly, it is a completely private device. And it only works within the local area that you happen to be in. Now, let’s say you want to send a private message to your girlfriend. I don’t know, sometimes some people might want to send something juicy that you don’t want people reading. Well, you do it. No one knows where this message even came from. It’s a floating network in constant flux that cannot possibly be tracked. It’s not replacing Internet—it’s adding a layer of privacy that you can use when you choose.
JASON HARTMAN: So, it’s a box? I mean, describe it. What I it?
JOHN MCAFEE: It’s a very small device, about the size of a very small cell phone, that you slip in a pocket. There’s no screen, you just turn it on. There’s an application that you download through your smart phone, and that’s that. The application connects to the device, the device is powered on, and then anybody else within about a quarter of a mile radius that has one of these devices is connected up. Let’s say you have files you don’t share. I’ll share this song, I’ll share this news report I found today, I’ll share a poem I wrote, whatever. You just go in as common area. As you pass, let’s say in the morning you wake up and you like to hear—I don’t know, you’re looking for a specific song. As you move around throughout the day, the hundreds of thousands of people in your local area, these devices are communicating. If it finds it, it just grabs it. Because that person has put it in the common area too. You have no idea where you got it. The person who sent it has no idea they sent it. There is no record.
JASON HARTMAN: Oh, interesting! The music industry’s going to have another fit about this….
JOHN MCAFEE: The music industry has called my product dangerous, as I suspect they would. But if you think about it, the telephone is dangerous. People use the telephone to perpetrate all kinds of scams, don’t they?
JASON HARTMAN: Sure, of course. Telemarketers…
JOHN MCAFEE: Telemarketers.
JASON HARTMAN: So you have this device. Does it only work over the Internet part of your smart phone?
JOHN MCAFEE: It creates a separate network apart from the Internet. It can communicate with the Internet, if you choose. But in privacy mode, it is a completely separate network–encrypted and impossible to track.
JASON HARTMAN: And what does it do? Your cell phone signal goes to the D-Central device.
JOHN MCAFEE: It’s not the cell phone signal. We’re connected up via Bluetooth. Your cell phone signal is not intercepted or affected in any way. The device itself is a communicator, with a range of about a quarter of a mile. Everybody else with one of these devices within a quarter mile are connected up. You can choose to share nothing, or everything. But at no point does anyone know who you are or where you are.
JASON HARTMAN: Okay, but the person I’m sharing with has to be close to me—within a quarter mile.
JOHN MCAFEE: Within a quarter of a mile. Or, you can also relay. If for example there’s not much traffic, it can relay to the next local network, and the next and the next, and it can actually go around the world in a fraction of a second if necessary. But it will depend of traffic. But you can certainly depend on—for example, a college campus. Everyone on the college campus would be able to communicate through this private network. They want to be connected, and no one would know who was doing what.
JASON HARTMAN: So, what would we share on it? I mean, you gave the example of music. Can we talk, can we have a phone conversation?
JOHN MCAFEE: Not yet. That is certainly coming, in our next generation. You could have your own private email. You could share anything you wanted. Photographs. Let’s say you just want to share the photograph with your fraternity brothers. So you would set their privacy level. No one else would even receive that photograph. No one else would know that photograph had been transmitted. Anything you wish to keep private, you can do so.
JASON HARTMAN: Right. And do you do it over the email application on your phone?
JOHN MCAFEE: No, absolutely not. It’s done through our own application, on our device. Even though there’s no screen, you don’t need a screen—we’re using the screen on your cell phone.
JASON HARTMAN: Alright, yeah! Very interesting! This is a great idea. How much does it cost, John?
JOHN MCAFEE: We’re shooting for under $100.
JASON HARTMAN: And when does it come out?
JOHN MCAFEE: Well, our prototype will be ready in approximately 6 months. And then 6 months after that, we hope to have a marketing version available.
JASON HARTMAN: Now, one of the things that it depends on is what’s known as—of course, you know it all to well—what’s known as the network effect. Because it wouldn’t do any good for you to be the only one with one of these D-Central devices…
JOHN MCAFEE: Of course. The first person to buy one, we’ll have to give out a few thousand for free at first, just to get people to take them. But as if builds up, the functionality increases. I mean, I can imagine if I’m on a college campus, if 10 or 15 buddies get together and have one, I promise you, everyone else will want one.
JASON HARTMAN: Yeah. Very interesting! What kind of opposition are you looking for on this? Because, I have long said, ever since I learned about Bitcoin, I’ve long said the Feds are going to shut that down because it’s in competition with their central banking cartel.
JOHN MCAFEE: Well, I anticipate all kinds of problems. The music industry, and the movie industry, will—even though every study done by anyone outside the music industry has shown that people who pirate actually spend more money buying things than people who don’t!
JASON HARTMAN: I’ve heard those studies too.
JOHN MCAFEE: And the movie industry has record earnings, so tell me how that hurts. We need a new paradigm. So music, the movie industry, and I’m afraid most of the government. Governments do not like to be blocked in their attempt to intrude.
JASON HARTMAN: Well, I think you’re so right about that. When you read or listen to the audio book version of Chris Anderson’s book Free; that’s really well explained. Oddly enough, it’s—you’ve gotta come into business with an abundance mentality, and the music industry and the movie industry certainly don’t have that. They have a scarcity mentality.
JOHN MCAFEE: Of course.
JASON HARTMAN: If people rip you off a little bit, or even if you allow them to rip you off by giving it away, more things actually come out of that. I saw an interesting presentation just the other day in Las Vegas by a Steve Pavlina, who is a well-known blogger, very successful, and he decided to give away all of his material. He took all the copyright notices off—in fact, he said take my stuff, you can have it. It’s not even a Creative Commons license. It’s just a steal. And what’s happened to him has been nothing short of amazing!
JOHN MCAFEE: That’s exactly what I did with McAfee! I put on the front page, please steal this software.
JASON HARTMAN: Kind of counter-intuitive, isn’t it?
JOHN MCAFEE: It is counter-intuitive, yet it works.
JASON HARTMAN: Yeah, really interesting. Okay, so, this’ll be out in about 6 months, you think?
JOHN MCAFEE: Yes, we’ll have a prototype in 6 months, we’ll have proof of concept. And 6 months after that we will have a version capable of being sold.
JASON HARTMAN: Fantastic. So, is there anything else that you want to share with the listeners? Any other tips, or ideas, or concerns?
JOHN MCAFEE: Well, I would say open your eyes to the reality of the world around you. It is not what it appears.
JASON HARTMAN: No question about that. And give out your website, John, if you would.
JOHN MCAFEE: It is www.whoismcafee.com.
JASON HARTMAN: And let me just spell McAfee: it’s M-C-A-F-E-E. www.whoismcafee.com. And some really interesting stuff there about your history, and Belize and so forth, and I’m just glad you’re safe, and I hope you continue to be. And I look forward to your D-Central product coming out! It’s something we need.
JOHN MCAFEE: Well, thank you very much. And thank you for having me on your show.
JASON HARTMAN: Thank you, John.
JOHN MCAFEE: Bye bye.
[MUSIC]
ANNOUNCER: 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 any individualized advice. Opinions of guests are their own, and the host is acting on behalf of Empowered Investor, LLC. exclusively. (Image: Flickr |
Transcribed by David
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