Never Work Again Interview with Adam Markel and Phil Town!

And I'm so excited to be spending some time tonight with a dear friend of mine. And you know what's really great is that I get to share this friend with all of you. So you're very, very lucky. I hope you guys are excited about that. We're going to take about 30 minutes. We'll keep it nice and short, but very, very sweet. Get right to the meat. So I'm going to introduce him quickly. He's a guy that probably at this point in his career doesn't need much of an introduction, but I'm going to do it anyway. All right. He's a two time author. He's appeared, oh, I don't know, he's trained a couple of million people. He's appeared about 10,000 times. He's appeared with, I think, five presidents in the past. And he runs a hedge fund that's actually, I think, among the top, if not the top hedge fund among 70 that are tracked in regard to the types of things that they invest in. And this year so far, they've even gotten a return of about 38%. But he's just all. Those are great accolades. He's a father. We actually have something in common. Both father of four. He's married to just amazing, amazing woman, has a long standing relationship. So I just feel like we have just so many things on a heart level that we are both passionate about. And he's. I don't use the word guru. I don't think that's a word I like to throw around too easily. But this is a gentleman who's been training and teaching people in the area of stock investing on how to get extraordinary returns, really big returns with great safety for a lot of years. And he's a natural teacher. He just loves to spend time with people, helping them get to where they want in life. I'll say no more. Just introduce him. And this is the one and the only Mr. Phil Towne. Hey, Phil, how are you?

Adam, it's a real pleasure. How do you talk me into these things? I love you is why. It's because I love you. What can I say?

What are you going to say to that? True.

So here we are. Here we are. We're going to talk about money. Yeah, I don't doubt.

And this is cool, right? This is. We're hanging out. I'm at home and Phil's at his ranch. And I'm at home in San Diego. I was going to say it was a beautiful warm day, but the weather has changed at night. It always gets A little chilly here. But in any event, we're live, and we want to talk about the ability to create financial freedom. This is something I'm very passionate about because I used to be a workaholic lawyer, 70 and 80 hours a week, and slept in the office. And even though we have four kids, my wife and I were so happy to have kids. But at some point, you know, she's looking at me, I'm looking at her, and we're going. But you don't. You know, you don't see them very much.

What's the point of having them if you don't spend any time with them? Right?

And I think that's the problem for a lot of people, is that they work their whole lives away, and when they finally want to relax and settle into their life, it can be a little bit too late. They can miss a whole lot of things along the way. I know I missed a bunch along the way, but once I had a new awareness about what was possible in terms of just reordering my priorities and getting my money to work for me and creating some leverage and doing some smarter things, just making some smarter decisions, I was able to get my time back. And I've never looked back since. I know, Phil, you're a guy really honors, and we want to teach our students how to do it just like us or better. Even better. And that way they can be what they want to do.

I never did the lawyer thing, you know, I don't know. My kids only know me as the dad who was around too much. That was probably their problem. And my wife wishes I had a real job, because I probably am in her, you know, under her feet too much. And, you know, probably financial independence is, you know, maybe it's overrated. I mean, I just spent the last three hours at the barn shoveling horse manure, because that's what we do. Now. We got a bunch of horses out here. All right, I got to go down to the barn and shovel horse manure. I'm teasing about financial independence, because, honest to God, it's such a blessing, and we have been blessed like that for pretty much my whole adult career, because I started investing under the wing of a guy who was really good investor, who's a student of Warren Buffett's. And I learned to invest in that great, amazing strategy that we call rule one investing. Because Buffett said there's only two rules of investing. Rule number one, don't lose money. And rule number two, don't forget rule number one. And that's how we learned to do it. I've been doing that ever since. And honestly, it's how little time it takes to do this once you learn how to do it. So I was the guy who taught my kids volleyball and snowboarding and went to every single game and coached the teams. You got the time to do that. And honest to God, it makes such a difference in your life with your family that you have the blessing of time. A lot of people have money and they don't have time. A lot of people have a lot of desires to do a lot of things in their lives, and they never get a chance to do them. I'm reminded by a guy that invests very the way I do. He's an Indian guy named Manish Pabrai. He runs about an $800 million fund and is really good at what he does. He's compounded about 32% a year for the last 10 years. And he was saying his day starts off at about 10 in the morning when he gets up at 10, actually, he lives just north of you a little bit. He's up in Orange county, and he gets up at 10. And then he kind of makes some breakfast, and his wife is like, honey, could you go do something? And he does a little research, and then he goes and plays some golf. And that's it. That's it. That's the day of a guy running $600 million. Because we're not out there trying to just force it to happen. Rule 1. Investing is all about just recognizing the opportunities. And really, Buffett said the biggest mistakes that you make are when you act when you shouldn't. And mostly the right thing to do is do nothing. So I do a lot of nothing. I'm very good at that. Adam. It's like a lot of nothing. And you've got me talked into coming out there and telling your guys how to do what I do. And I'm going to do that. I'm going to spend as much time as you want to give me, and I'll just start going through this, and I think it's going to be fun. People are going to see that investing is not what you think it is. At least doing it the way we do it. We're in this school of investing that's been successful in the upper 20 percentile. Compounded rates of return. Now, for everybody, I know that's doing it as professionals. And it started with Ben Graham, and he made 22% a year all through the Depression and World War II. And I ought to give you a clue about how effective it is. And then of course, Buffett, when he was doing a small amount of money, was making over 50% a year. And, you know, we've done really, really well over the long term. And so I just think that the biggest mistake people can make about investing is to think, number one, it takes a lot of time. Number two, a lot of risk. And unfortunately, I don't know if I'll spend a lot of time on this in class, but I'll tell you, they just recently made it a requirement that all hedge fund managers have to become registered investment advisors. So I test, and honest to God, man, half the stuff on that test is wrong. The way the rest of the world looks at investing, for example, this is a huge one, Modern portfolio theory, which is how all of the funds are run and all of the pension funds are run with Modern portfolio theory says that in order to make a higher rate of return, you have to take more risk. If you've ever had a financial advisor have you get one of those little checkbox things and say, how much risk would you like to take, Mr. Margiel? And you go like, well, I'd like to take a lot of risk. Zero.

That's how much.

Who answers that? They want to take a lot of risk. Nobody wants to take a lot of risk. It's the stupidest question on the planet. And yet you have to put that down. So if you put no risk, then what they're going to do is say, okay, fine, we'll put you into Treasuries and, and you'll make 0.5% a year. And then you go, wait, wait, wait, wait, wait, wait, wait, hold on. I don't want to take a lot of risk, but I want to get high rate of return. And if you've ever read anything about Warren Buffett, you would then say to your advisor, well, Warren Buffett says you don't have to take a lot of risk to get a high rate of return. What you have to do is just wait until an event happens that puts a great company on sale and the events come along like clockwork. Our teacher Ben Graham said that all you do is, you know that it's a good company, and you wait for just a natural market fluctuation to come along, and then you buy it when it's on sale. And honest to God, that's all there is to it. But your fund manager can't do that. He knows he should, but he can't do it, and he can't do it. Is because, in fact, I'll show you. I'll bring this article from Kiplinger's. It's a blow your mind because it explains in just a nutshell why 99% of the guys out there running funds are momentum investors just trying to keep up with the market and can't just sit in cash and wait patiently and buy something on sale. They can't do it, so we can. And Warren Buffett went to Columbia University and said, God, I hope they just keep teaching these guys this, because we can just keep making billions.

Because they create imbalance in the market just from that. Right.

Oh, marketplace used to be thought of as a very. The whole stock market used to be thought of as a very rational place. No one would ever buy something and pay too much, and no one would ever sell something when it was overvalued or never sell something on sale. In 1999, Robert Shiller wrote a great book called Irrational Exuberance. He's a wonderful economic professor at Yale, and he basically said, what a crock. The market is absolutely full of emotion. These guys are running these big funds and they're scared to death they're going to lose their apartments on the east side of New York if they make a mistake. And that's all it takes. And they're gone. And they're always the smartest guys in the class. They were the valedictorian in high school, and they graduated number one at Harvard. Then they graduated Harvard Business School. Then they went to Goldman Sachs. They're the smartest guys in the world, but they're trapped in the system. And, man, that's why Buffett lives in Omaha. That's why I've never wanted to be around New York, is because the advantage we've got as little guys who are out here on our own is that we don't get caught up in all that emotion, all of that limbing, like behavior of following momentum. So that's what I'm going to teach you guys. I'm going to show them how to do it. And when I'm done speaking, that audience of yours is going to know how to go out and make 25% to 30% a year. And then I'll even show them one little technique that we use that you can only do. I can't really do it as a hedge fund manager, but I could do it as a small investor before I started all this. And it can knock out ballpark, 40, 45% a year. Here's the best part. 95% probability of success per Investment.

I need you to repeat that. Yeah. Okay.

You ready? One more time. Okay. It's statistic like. It's basically using the Black Scholes formula to produce a statistical probability. And I'll show them how to do it where you have a 5% possibility of losing 1 in 20. Okay. And you're going to win. In other words, you're going to win 19 times out of 20. And the average rate of return is about 43% per year. Our worst year was 2008, when the market dropped like a brick. All we made that year was 33%.

In one of the worst years on record, the year Lehman Brothers went bankrupt, we only made 33%.

Yeah, we only made 33%. I'm going to show you guys how to do that, right? It's not hard to do. You just have to learn a few things, and it's worth learning. And I'll tell you when you get it. You can do this. Here's how long this takes per month. Adam, this is the total amount of time I spend on this trade per month.

You're reading my mind now, because the time thing, because I know there are people that are watching. This actually won't. There are people who made the commitment to, let's say, come to never work again. We're doing it on the Eastern, obviously, you know, this east and West Coast. So we'll be in Southern California, and we'll be in Orlando on consecutive weeks in December. And there are people who are coming more than anything at our company, we honor people that take action. Because one thing's for certain, and this is across the board, we know nothing will change in your life, my life, anybody's life, if we don't do something new. And different things routinely stay the same. So we've got a lot of people that are enrolled in these programs, because the truth is, they weren't taught what you're talking about. The things that you've been able to teach your K. You know, most people weren't taught, and financial literacy isn't taught in the school system. So if you don't get in the school system and you don't get it at home, chances are pretty good that you're going to get into your 20s and 30s and be a little bit clueless about how to manage money, about how to invest, et cetera, not even understand how to evaluate risk. I mean, all these things are just kind of very foreign.

I think it's even worse is that a lot of times the people who love us the most are telling Us, things that are completely wrong. It's not that we don't. It's. It's terrible. You're right. We don't learn the right way. And what we do learn is often the wrong way. I mean, people tell you things. I mean, you're. You're one of the experts in the world on this. I mean, I'm talking to you about this, like. But honestly, I've seen this in my own life. You know, my family was all about. We're blue collar, railroad, union, you know, rich people. There's something wrong with them that was just embedded in our family culture. And, you know, they. And when. I guarantee you, people listening to us right now who are hearing me say things like, you could make 33% a year or 43% a year, and you can do it on 10 minutes a month, are sitting there right now going, that is B.S. that's something wrong with that. That can't be true. I'm going to. You know, I'm skeptical. Skeptical is okay. But to say that a guy like me, who I'm out there in public, I've got a record, is not true, is ridiculous. It's just pushing away the opportunity to do something great in your life when it's standing right in front of you, you know, And I see people do that all the time because of the stuff that's between their ears. And honest to God, that's why I'm coming out to your program, Adam, because I truly believe in what you guys do. Absolutely helped me when I started reading all this stuff and thinking about money in a different way. And I'm telling you right now, man, people are getting a great education from you, and they ought to be there.

Beautiful. Yeah. You know what, Phil? You're right. The mindset is so important. I mean, with that. So call it the inner game, if you will. Right. When your inner game is strong. And that really has to be the strongest thing, I think, because we've seen too many people that have been able to achieve some success. Success, and they can't hold on to it. So they got it, and then they don't. Part of the reason they don't have it for long is just because they're a bit. They're not fully aligned on the inside. Let's say the wheels can come off the track pretty quickly when you don't know who you are and you're not fairly grounded and you don't understand why you want a bunch of money. I think we get a lot of people, meet them in wherever they are like. I also grew up. My dad was a civil servant. We didn't have any money. I shared an apartment, a room in a small apartment with my brother. I didn't have any language of any of these things. What I think is great is that we meet people in wherever they are, and then we do some work on the inner game, on their heart, and being ready to take advantage of opportunities so that, like you say, that you don't just watch them go by. That Warren Buffett, you know, in 2008, he was like, the United States is on sale, right? This is a great. He'd been waiting 10 years for an opportunity like that. Meanwhile, other people were jumping out of windows and the foreclosures and everything else that was going on. And, you know, it's. A lot of people got caught up in that. But the truth is, that was a great opportunity. And what I'm hearing you say is that now there are great opportunities that don't require a lot of time and don't really involve a lot of risk. And it's just a question of, you know, if you're the right person, you know, because you've been doing the work on the inside, well, then you've got some outer game stuff that you just have to learn, and then the results could be something staggering for you.

Well, I think staggering is coming up. Honestly, I do. I made that call in 2007, before the market peaked. We went to cash, and I did that publicly on CNBC with Maria Bartiromo and got in a big battle with a guy from Kiplinger. In fact, I'll bring a bit of that videotape with me if you want. And then I went back in the market aggressively and again did it publicly. In March of 2009, Maria asked me, well, hey, the market's at 6700. Why are you going back in now? Because it looks like it could go to 2,500. It's completely coming apart. I said, look, I've got Chipotle Grill out here at 49 bucks a share. I've got Whole Foods at seven. I don't know where the market's going. Well, we're loading up the truck right now. Chipotle is at over 600 from 49. Whole Foods is at about 47 from 7. Five years later, I think we're about to get an opportunity just like that within the next year or so. What I'd love to see is that I can get some of your guys out there educated by going to this event, ready and prepared to go out and take advantage of it next time it happens.

Yeah. And that's it. I was having a conversation with a friend earlier today. The preparation is so important, don't you think?

It's 100%. In the real world, you can't take real money and put it into something until you have the preparation done, because you won't have the. You'll be afraid to do it. Common sense will jump in there and it'll tell you, hey, whoa. You don't know what you're doing. I mean, look, Adam, my brother sold his company for $91 million, and he had never once. This is my little brother, right? He'd never once wanted me to teach him anything about investing. Sells it for $91 million. Now he's got all this money, and he doesn't know anything about investing it. And as he was terrified, he was already richer than you'll ever have to be in his life. Right? But he was terrified to invest even a couple hundred thousand dollars of it because he had no experience with it. So what I'd love to see you guys do is come here, let me show you some basic stuff. Go home, show you some tools, practice with that, get ready. And, I mean, it's going to be pretty obvious when the time is to load up the truck to anybody that does this kind of investing. You're going to see the bargains happen, and then you'll be ready for it. You'll be prepared, and then you can take action. And then you can really change your life financially. All for showing up. All for showing up. How hard is it?

I'm going to be there. I'm glad I got to rope you into this hangout. I'm glad that, more than that, I got to rope you into coming to two never work agains. I mean, that's just brilliant. So look, if you're listening, if you're watching this, and don't make me jump through the screen, don't make me get out the address book and come and find you and rope you and tie you and take you to this thing. Because bottom line is this, you got to do that for yourself. I'm not going to hit anybody between the eyes tonight. I do that from time to time. And I hope you all realize that that's coming from my heart. Because the truth is, I didn't have any great start in life filled in either. It's just a question of at a certain point, you decide you're going to make some changes and do some things that are Different. Different than the way your parents did it, different than the way your siblings have done it. And that's what creates your life. You're going to get some feedback, get some experience, and then. And then move forward with confidence. I think what I love best about this, not only the program, which is all about retraining your brain to be able to see the opportunities. So that's, again, more the inner programming side, is that we get to have a person like you, Phil, that can teach people what they need to be able to prepare so that they don't have to have fear when it comes to the great opportunities that will show up. When preparation meets opportunity, well, then great things can happen. So again, if you're sitting on the fence somehow that you're eligible to attend because you paid for it, or it's part of your quantum leap or whatever it is, and you need to make a decision about whether to put in for vacation time at work or let somebody at your business actually pick up the reins. Because truthfully, if you've got a business that doesn't run without you, you don't have a business. You have a job. And you probably have the worst boss on the planet. But we'll save it for another day for that. There's no better time than now. That's just the bottom line. There's no better time. Get to network again. You get to meet Phil Town. You get to learn from a master. We all do. I'm blessed. I feel really very, very lucky that we can share you with all of our students this year, Phil, and it's been nothing but a pleasure. Thanks for being on this hangout.

I can't wait to see you then. So see you in December.

Yeah, we got two. We're at the Caribbean Royale in Orlando, and we're at the Westin Mission Hills. And if you're. If you're looking for the dates, they're right there on the. On the email that you guys got. High five, Phil.

Hey, man. Right there. Got it.

Awesome. All right, we'll see you guys.

Very, very.