A.I. Chess Bot Reveals BIG Investment Fund Secret!

Hey guys, welcome back to Investment Fund Secrets. I'm Bridger Pennington. Today we're gonna talk about how artificial intelligence winning at chess can actually help you get your fund off the ground faster. Now, I don't know if you guys have ever seen this before, and shout out to Tom Bilyeu who introduced this concept to me. It's like the craziest thing I've ever seen is if you've been on YouTube, you can watch AI learn how to play chess. And Google just came out with theirs, it's called AlphaZero, and they've had it play multiple games, and it uses— so this is their artificial intelligence to learn games. It's like the craziest thing you've ever seen. It sits down and it does— the first thing they have is it has deep neural networks, whatever that means, but secondly, they have a— it's called the general reinforcement learning algorithm, which means for chess, for instance, they teach it chess rules and chess rules alone. That's it. There's no other outside learning besides The game at hand, and this computer will sit down and from scratch, from zero, start out and it'll make a move and it gets just completely destroyed. You watch it move and it's like, oh crap, and it goes and does it again, and it plays the next game, and the next game, and the next game, and in 4 hours, it was able to beat the 2016 World Chess Champion after 4 hours of learning, of trial and error, and learning from its mistakes. It's like the craziest thing you've ever seen, and it teaches a really cool principle to all of us about just being in the game and getting things done. It doesn't— like, you watch it play, it doesn't make a bad move and goes home and goes, ah crap, well that one didn't work, I'm never gonna do that again, that's crap, I'm never gonna try again, like most of us do, right? It gets up and it says, I'm gonna try again, resets the game, and it starts again playing, and in 4 hours, better chess player than hundreds or even thousands of years of people playing chess and all of our evolution and humans, it was able to win at chess. And so what does this teach about ourselves? I think a few things, and what I'm about to say isn't all the way true, but the concept will make you become better than ever because the concept is this, is if you are given enough time at anything, You can become like that chess player, better than anyone else in the world. Now, what I just said isn't true most likely because it's just not probable for us to calculate that many calculations, but on the journey of staying at something longer and learning from our mistakes over and over again, we become over time better than our peers and our collective field at any given subject. So, The first things I took away from this as well, this analogy about funds as well, is number one is being in the game. It's very interesting that they didn't have that AI machine watch previous chess matches. They didn't have it watch the 2020 championship or go back and watch the best chess players of all time. It started out in the game and said, I'm just going to start from zero and learn. And I think for us, you got to be in the game. For me, I wanted to be a fund manager. A lot of you guys know my story. I wanted to be in the fund world, and I said, what's my fastest route from zero to learning how to be in the game? I said, well, to put myself in the game, to get started with my own fund. One of the main reasons I did this and started out on my first syndicate deal was because I knew I would learn way more and be way taught just way faster by life experiences being in the game, not sitting as an analyst watching other people play the game. But myself being in the game, I had a buddy text me a little bit ago, he goes, Bridger, this is wild that we as young entrepreneurs, young people in this world get to live through a crisis like this so young in our career. Because we are in the game and get to learn from what's going on with this coronavirus crisis right now in the markets. In your first few years in your career, to learn something like that is super valuable. 'Cause there's a lot of people out there that right now aren't learning much, right? They're sitting at home, they're learning how to use Zoom calls, and that's about it, right? They aren't watching and they're not in the game seeing exactly what's happening with banks. They're not applying for loans. They're not trying to find investors. They're not deploying capital. They're not trying to recoup capital. They're not in the game and they will learn at a slower rate. I think it's a cool concept of being, actually just being in the game. Secondly, I'll tell you this, the reason I started this podcast and started online marketing and stuff, a big reason was It made me get in the game. It made me sharpen my sword and sharpen the tools, I guess you could call it, to make me be better. If I'm going to be on a podcast twice a week about different subjects, I've got to dive in, and it makes me learn faster because I have a public audience that I have to try to impress with knowledge that I've gained over the last week. I try to put myself in the game as much as possible, and I've seen people that have grown the fastest and fund managers that I've studied That you see people like Ray Dalio, you see people like Warren Buffett, all started funds at very young ages, you know, in their 20s. Ray Dalio, 20— I think 27, 28, started his first fund, got in the game, started learning. A lot of these guys you see on the top of the mountain, right, and they're like, oh, I did so great. They started in the game early, and the game taught them faster than a 4-year degree or a 2-year MBA, right? The game teaches you way faster. So be in the game. Don't be a passenger. Don't be And even if you're working at a big company, sometimes you're not in the game. Get yourself in the game. Get yourself to the meetings that put you in the game, or at least you can watch people who are in the game, watch them very closely. And this is something my dad actually— so my dad co-founded over $20 billion family of funds. He's been on our webinars and stuff. You guys have seen him before. He has a really cool quote that he loves to talk about. He calls it the epitome of ignorance. And he goes, what is the actual epitome of ignorance? The epitome of ignorance is not believing that something could happen or could come true or could be simply because you know nothing about that subject. So the fact that I know nothing about cricket, the game, and me saying, oh, cricket's the worst game ever, I don't ever want to play it, is— that's what my dad calls the epitome of ignorance. A lot of people do this about funds. And I've had a lot of people on that have commented on my stuff that are sending me DMs or whatever like, dude, you don't know what you're talking about. You don't know anything. I'm like, well, then what do you know? And they don't even consider getting in the fund world. They're doing something else. They don't know the first thing about the fund world or syndicate world or private equity venture capital, whatever you wanna call this world, investment fund world. But they just go, it must be too hard. It must be too out of there that no one can do it. There's no possible way that it could happen. And that is what my dad, and I agree, it is called the epitome of ignorance. So first rule that I learned from that AI game was to get in the game. They are there, and don't count yourself out if you make a freaking mistake. The AI, you don't see the AI move its queen and be like, ah, well, it's over, like I'm never trying again. It gets back up and it just resets the game and it starts over. It doesn't care, there's no emotion, there's no feelings, or I gotta go home and get some rest, it just starts over, so it's fine. Coronavirus wipes me out, fine, okay, let's get going. And thank goodness this— our fund hasn't been affected yet by the virus. We do lending, we have a debt fund, so we'll see over the next 6, 8, 12 weeks if those loans start defaulting at a high rate. Hopefully we're good, but that'll teach me a lot of lessons going into the next crisis, and I have now gained more experience by living through a crisis. That kind of makes sense? Mm-hmm. Now secondly, and we talked about this previously, but I believe we gotta actively learn from your own mistakes. That's what the AI does, right? It moves its queen to whatever spot and it goes, crap, that sucked, I'm not doing that again, right? It logs that memory. A lot of us don't even learn from our own mistakes, me included. I don't learn from a lot of my own mistakes, like with my wife or family. Like I keep messing up on certain areas and we've gotta relearn. You guys have heard this before, but then learning from others' mistakes I think is crucial, especially right now. Are you guys watching what is going on? Yeah. I've tried to bring a few of these things up, but it's been so interesting what's happened over the last 6 months, just through this crisis alone, what I've tried to pull away. You see people 6 months ago or 8 months, a year ago, you see Warren Buffett, Ray Dalio, Bridgewater Associates, Berkshire Hathaway sitting on tons of cash and openly scrutinized about sitting on cash. of saying, what are you guys doing? You're sitting on a— I think Berkshire was sitting on like, it was like $90 or $100 billion of cash and he was just like, I'm not moving. We are sitting on cash waiting. And people scrutinized him, what are you doing? How are you an investment advisor? What does this all mean? And with Berkshire Hathaway, they sit on cash, right? They're sitting there, they're getting scrutinized and he just goes, hey, we're gonna wait for this crash. We're gonna wait for something to happen. And They come out, Berkshire Hathaway, and buys this dip the last 3 weeks. I've had a huge— they call it like the Berkshire Hathaway bull rush where it moves— it moved up, the whole market moved up a ton because Berkshire stepped in and bought the dip. And now everyone's like, wow, you guys are so smart, you guys are so genius. For the past 9 months, the media has been calling them out like crazy. Another incredible story if you guys follow this, Bill Ackman had one of the greatest plays in like the last decade. With fund management. So Bill, this is last, I think I have it dated, it's like March 16th or March 18th. He comes in and he says, and on CNBC he is quoted as saying, all hell is about to break loose. And he's like, this is bad, CEOs, governments need to respond faster, this is terrible. He really talks down the market. Market plummets like you guys have just watched the last couple weeks. And Bill Ackman, Shorts the market with $26 million. That's it, $26 million. He that turned that now currently is into $2.6 billion over the last month. That's what Bill Ackman's done. And we'll see if he's got more, some more tricks up his sleeve. He's publishing more stuff right now, and I think people are more wary of him using the media and controlling the media to manipulate markets, but you can watch huge fund managers taking advantage of overbuying and overselling. The market always overplays everything, right? And they are taking advantage and making billions from doing this. Another fantastic example, if you guys have read the book More Money Than God, it's actually a really good book. It's a long book. It goes through the history of hedge funds, and it walks through pretty much just stories of hedge fund managers. It's a really entertaining book. Teach you a lot about setting up a hedge fund, but it teaches you a lot about what fund managers did in the past. And one of the stories, it talks about George Soros in 1992. They call it he broke the Bank of England. And this is when they mentioned that fund managers really implemented and put their hold on world markets as like, wow, hedge fund managers can really change the outcome of an entire country's currency. And what happened, and this is 1992, September 16th, this happened. So the British pound was trying to stay above the German mark in what's called the ERM, the Exchange Rate Mechanism. It's kind of before the European, the euro and the European Union, this is before then they had this. And the British pound was kind of the premier currency of this, it's called the ERM. Now the German mark was also a good second and they were battling to be kind of the head currency. Britain's feeling pressure from other countries. They were going to exit this and just be their standalone, kind of like they exited the European Union just barely with Brexit, similar kind of situation. They're planning to leave. They didn't know what to do. They're back and forth in Parliament trying to figure out what to do. They decide that it's a good idea to almost Well, I don't even know how where it started out, but they put their interest rates in double digits to attract people to buy their bonds and treasury bills to bring a ton of customers to the British pound and make it super valuable. George Soros steps in and says, "No, like this is not going to happen. You guys can't just up your your bond prices and and grab a bunch of customers." He comes in and shorts the British pound. and uses a deca-billion dollars to come in, short the pound, and he puts tons of pressure on this pound, and they go back and forth with the Bank of England. And George Soros, along with his entourage that he brought with him, he was kind of the spearhead but brought on a lot of money to short the British pound because they thought it was way overvalued. And ultimately, Britain had to back down from their high interest rate hike, their pretty much just their discount sale. He called them on their bluff. George Soros, in a matter of a few months, made $1 billion netted from this deal and solidified fund managers as a world economic player, even to world central banks and world currencies that they could manipulate and manage and correct a lot of these banks and central banks that were manipulating their currencies. Huge lesson that I learned from that was there are Lots of opportunities right now, and I want to talk about a few things happening with this coronavirus crisis. A lot of small businesses right now are— there's a lot of motivated sellers, you could call it. So a lot of small businesses that are— and if you guys watch our interview with Ace Chapman, he actually teaches people how to buy small businesses. He's actually in our group now and teaches people what's going on with these small businesses and how you can manipulate and leverage them and buy them. And negotiate, especially with small businesses. If you want to start a small fund, maybe you're not going to go against the Central Bank of England, right? But there's a lot of small businesses that are motivated to sell in a crisis like this. And the best part is money is almost free. Interest rates are almost to zero. Banks are very liquid right now. There is lots of money in the market, and they're trying— the Fed is trying to put more money into the markets, and there's lots of motivated sellers for small businesses. Huge opportunity there. You can watch, you can either be a player, be in the game, or you can sit by and watch and learn from others. Both work well. That's why I love books. They have a decade put into a few hundred pages inside of a book that you can learn on and get ahead and sharpen the sword. So if you're taking anything away from this, be like artificial intelligence learning chess. 4 hours, became the best chess player to ever live, I guess, or to ever be on the planet Earth. I don't know if we're gonna call AI humans yet or have You know, him or her AIs, I don't know. But take a lesson from that of trial and error and learning from your mistakes, learning from others' mistakes, and putting it all together and not getting down, not putting emotion into it, not saying, oh, I'm an idiot, I can never do this. If you are given enough time, you can accomplish and achieve anything and become a master at anything. Love you guys, and I'll see you in the next episode. Peace.