1511: Rentier Class, Florida's "A" Grade, Greed, Fed = Inflation, Single-Family vs Multi-Family Pt. 1

Welcome to the Creating wealth show with Jason Hartman. You're about to learn a new slant on investing some exciting techniques and fresh new approaches to the world's most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine, self made multimillionaire who's actually been there and done it. He's a successful investor, lender, developer and entrepreneur who's owned properties in 11 states, had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason's footsteps on the road to your financial Independence Day. You really can do it. And now, here's your host, Jason Hartman with the complete solution for real estate investors.

Welcome to episode 15, 11511. Thank you for joining us today. So today we're going to talk about the rentier class and guess what? Many of you are a member, so congratulations. But Joe Biden. Yes, senile Joe Biden, who? I'm not making fun of his senility. I'm just going to pick on his complete stupidity because he was an idiot long before he was senile. And Joe Biden is proposing a 775. Wait for it, billion with a B. That's almost a trillion with a T$ child and elder care plan funded by, guess what, real estate taxes. Yes, the presumptive nominee for the Democrat destroyer party. Unbelievable. And speaking of disgusting Democrat destroyers, the New York Times, no longer a fine institution of journalism, basically a political rag. They are threatening to reveal Tucker Carlson's home address. Now why would that be relevant to anything? Just so the wacko mobs of protesters can go and threaten his safety and his family's safety. Oh, gee, we aren't petty little children destroyers here, are we? I think we are. Yes. There you go. Wow, what a world we live in. And the disgusting idiots at the New York Times. Well, actually, I shouldn't call them idiots because they're not stupid. Okay, but the disgusting hypocrites at the New York Times. I see. I'm corrected. They are. They. Did you hear what they've done? They closed their office and they told their staff to work out of the house and essentially not go on any assignments. So basically what you will now have is you will have this formerly venerable media organization essentially have a bunch of reporters sitting in front of their computer screens on their echoplex. What do I mean by their echoplex? Well, their echo chamber, whatever you want to call it, seeing things that already confirm their belief systems that are always, always left leaning. Like there's virtually no exception. I mean, let's just admit it. And they will be sitting at home sipping their chai tea latte and seeing all the things on Twitter that already agree with what they believe so that they can cite them and write about them. Folks, the idea of journalism and the idea of reporting has left the building. Just like Elvis, okay? Elvis has left the building, as the saying goes. Same with the idea of journalism. This is an absolutely ridiculous environment, and it is tearing the country apart. It is so ridiculous, I can't even believe it. The New York Times threatening to publish Tucker Carlson's home address so people can threaten his safety. I mean, it doesn't matter what side of the political aisle you're on. And for full disclosure, I'm a libertarian, but even I think the libertarians are. A lot of them are wackos, okay? I don't even agree with him. I'm just a no man's land. I don't agree with anybody, you know? Oh, I'd say the typical thing. I'm fiscally conservative but socially liberal, and I guess I kind of am, you know, but, you know, I just hate to use that because it's such a cliche. It's. Yeah.

It'S ridiculous. But, yes, Biden wants to. Wants to fund his plan through real estate taxes. Okay, Biden, here's how totally fricking stupid you are, okay? Here's how stupid. You create your plan, you raise real estate taxes. There will now be a federal real estate tax. I guess that's what you have to do, you know, forget about all the state and local taxes, because that's not good enough. We've got to have federal real estate taxes. So what will happen then? Let's just take it to its logical conclusion so the idiot candidate can understand. Joe, are you listening, you fool? Okay? And by the way, don't you love. Don't you just love America? The fact that you can say stuff like that and, you know, maybe he'll get the New York Times to publish my home address, and some angry mob of idiots that don't even know why they're protesting will come and murder me. Okay, well, you know, that could happen, but constitutionally speaking, I'm not exactly in fear of my government. Now, what the government does do, though, is they find something else to pick up, pick on you about, and they use one of their proxies called Google or Facebook to pick on you. That's what they do. So that's how they get you. Because Facebook and Google and Twitter don't Have to follow the first Amendment because they're private companies. Well, actually they're not private, they're public. But that's another kind of public. They don't have a constitution they have to follow. They can just restrict speech when normally, you know, that would be fine to say they're a private company if they didn't have a monopoly. That'd be okay if there was actually competition in the marketplace. So you can go to Gab now. I haven't purchased a paid membership to Gab yet. Do you know about gab? This is the new social network where they won't censor you like these other disgusting companies. But anyway, let's get back to stupid. Joe. But the fact that you know you can criticize the government, isn't that a beautiful thing? Now the government does get back at you in the ways I just mentioned. But you know, you might get an IRS audit all of a sudden. You know, where'd that come from? Oh, I'm critical of the government, so now I'm suddenly getting audited. Oh, yes. You know, I'm not saying that happened to me. It didn't. But I'm just saying, you know, these are the kind of things that happen. Right. So Joe, can Joe here his plan. So you raise taxes on real estate, and then what happens? So fewer people buy real estate, so there's less demand. So fewer developers build real estate, so all of the existing housing stock ages and falls into disrepair, just like in the communist countries around the world. Right, of course that happens. But then depending on how you tax. Well, who are you going to tax? Homeowners. Well, then I guess you'll disincentivize homeownership and everyone will just rent. Okay, so now you've increased the pool of renters so there's more demand for rentals and now rental prices go up. Okay, you can attack real estate investors like non owner occupied property owners or. Okay, so what will they do then? They'll just have to raise their rents because everything's just a pass through entity. Okay. It's just so dumb. None of these idiotic government programs ever work. It's just they always disincentivize the right behavior and end up incentivizing the wrong behavior. Either by design or just the law of unintended consequences. I really don't know. I think it's varies. I think some of these are by design. Very much so. I think this war in the Middle east and when you talk about Syria and all this, I think that was by design to cause this mass immigration in Europe to basically overrun these European countries with refugees. And so now we see at least four of them are on the verge of collapse. Whatever exactly that means. When you talk about collapse on a country level, on a nationwide level, you know, that's a really complex subject because it's not the same as what we think of as collapse. So it's just different.

Wow, what do we do?

What do we do?

It's craziness. Craziness. But I gotta go make a salad for lunch, so I'm not gonna rant for too long because I need my veggies. We got a listener question from Tyler Smith. Tyler, thank you for your question. I'm curious to know your thoughts on two to four unit properties. Are small multi families part of your personal strategy? Are they useful properties for a new investor to scale faster than single family residences? Thank you for your time. Great question. It's been asked and answered.

No.

Numerous times on the show. And I will just very briefly answer it now, but I must tell you that I did years ago and you can go to jasonartman.com and you can search for these things. Search our podcast library. I did a long, like 45 minute analysis where I talked about all the differences side by side comparison of single family homes to multifamily homes. Now, the funny thing is when people say multifamily, it's just like saying, quote, commercial real estate, unquote. Nobody knows what that means. Sometimes multifamily is like Tyler's talking about here, you know, two, three, four units. Sometimes multifamily is like the apartment complex I just sold a few months back that I talked about. That's 139 units. Okay? Sometimes multifamily, 75 units. Sometimes it's, you know, I was asked, oh, my gosh, speaking of funds and pooled money, you know, I say pools are for fools. Well, this fund that a friend of mine runs asked me if I wanted to go in and invest in this apartment complex and said, you know, it's in the Opportunity Zone. And, you know, listen, I've told you many times what a scam the Opportunity Zone is, is. Okay, that is absolutely scamville left and right. Okay? Don't get suckered into it. Now, I'm not saying you can't make money on some Opportunity Zone deal. It's super complicated. We all know that. We've gone over that on prior episodes. But this deal was a really big apartment complex, you know, hundreds and hundreds of units. And I thought, well, you know, maybe I'll go in on that just to get tax break. And then I looked at the deal and listen to this. You know what they were paying price per unit for? You know, units built in the 80s. These are like class B units built in the 80s. Garden style units and a big giant complex. So that kind of perked me up. Tax benefit that got me interested. I have not reached my goal yet. I must tell you, I was thinking about this goal last night. Back when I was 24 years old. You know, like a couple years ago. Just kidding. Back When I was 24 years old, I remember one year, it was like my big year in real estate and I was working for ReMax. I became the number 59 agent for RE MAX in the entire world out of like 40 some odd thousand agents they had back then. And I was only 24. And so I thought that was a pretty big accomplishment. And hey, most other people did too. It was pretty cool. So that year I made $390,000 as a 24 year old kid. Now the instant question you should be asking yourself when I say that is, Jason, compared to what? Well, the question, what you'd compare that to is inflation. Adjusted for inflation, that's almost a million dollars today. And I was 24, so that's not bad. Sometimes I wonder where all that money went. I've never been like a totally stupid spender. I've certainly made some mistakes. But, you know, where'd all the money go? I don't know. You know, all this money I made over the years, it's funny, I mean, I've still got a lot of it, but compared to what I've earned, I'm like, where's all the money anyway? That year I paid like 100, I don't know, 20, $30,000 in taxes to the IRS. And I, you know, that was back in the day where they sent you your canceled checks back from the bank. They don't do that anymore. And you know, I got the canceled check back from my bank and I took the check and I hung it up on the wall in my office. And people would ask about it. You know, that's when you didn't worry about the routing number being on the check being exposed because there wasn't all this fraud like we have now. And people would ask about it and I would proudly tell them that my goal was to pay the IRS a million dollars a year in taxes because that meant, and keep in mind, adjusting for inflation, you know, that's like 2 million today. Maybe, you know, somewhere around there, you know, that would mean back then I would be probably making, with all my real estate deductions, I'd probably be making $4 million a year. And I thought that'd be pretty great to make $4 million a year just for inflation. That'd be like 8 million today. That'd be really great. So that was my goal, to pay the IRS a lot of money. And hey, I still wouldn't mind it, you know, I'll pay my fair share. I don't object to that. But you know, I'm going to use all the, all the benefits I can get to lower my tax bill, like anybody. Of course. So what does that have to do with Tyler's question? Oh, I know what it has to do with it. Pools are for fools. Be a direct investor. Commandment number three, thou shalt maintain control. Because this deal, I was looking at, Tyler and everybody else was, it was over $160,000 a unit for these B class garden style units built in the 80s. The lesson here is that, number one, when it's a fund, it's like community money. And if you haven't read about it or learned about this, be sure you go to that handy thing called the Internet and go and bing this. Bing, you know, don't Google it because Google's evil. Bing it. And well, Microsoft's evil too. They're all evil. Big tech is evil. Okay, but go to the Internet, go to the interwebs and type in tragedy of the commons. Okay, now many of you already know what tragedy of the commons is, but just learn about the tragedy of the commons. And this happens in, in pooled money assets. It happens in funds. Whenever anybody's raising money in a fund or a syndication or whatever, it's like what I always say, when it's everybody's money, it's nobody's money. And that's the thing. Nobody cares that much when it's not like their money. You know, maybe the fund manager has a couple of bucks on the deal, but by and large, it's not his money. He's getting paid for raising money, not for managing money, not for. What I mean to say is not for investing well. So I thought they were totally overpaying for this deal. It was like 160 some odd thousand dollars a unit in Indiana, you know, not necessarily in any great location, 1980s garden style, B class, two bedroom, one bath and two bath units. For 160 some odd thousand dollars, you could go right around the corner and buy a single family home.

Just go buy hundreds of those you'll be way better off. But this is what happens when you get into a pooled money asset. And also what happens when someone's selling an asset based on tax benefits rather than legitimate economics. It's a mania of sorts. It's cryptocurrency. It's the tulip bubble. You know, the tulip bulbs, right? You know about that. So if you don't, when you're on that interwebs thing and you're binging after, you look up tragedy, the commons look up the tulip bulb bubble and then look up rent seeking in the rentier class, because that's what we're going to talk about today. But anyway, to answer Tyler's question, Tyler, I think it's fine. I prefer single family homes, though. I don't think the two to four units will necessarily get you there any faster. I mean, why will they get you there faster? You didn't explain that. If they're a class, two to four units, yeah, that's fine. Okay. So you can get there faster in the sense that if you're limited to 10 Fannie Mae Freddie Mac loans and if that's a more expensive property, you can buy 10, two, three or four unit properties because that's just one loan for each rather than 10 single family homes. So in that way it'll get you there a little faster, but it doesn't really get you there faster any other way. Okay. And remember, a single family home will almost always have a better quality tenant than a plex, a duplex, triplex, fourplex or and certainly better than an apartment complex. Okay? So that's generally the rule now. It's not bad. I think it's fine. You know, if you have good quality duplexes, triplexes or fourplexes, I think those could be great. But remember, if you look at it on a scale like two ladders side by side and you have an A quality plex or apartment complex or duplex or triplex or fourplex, you will probably get a B quality tenant. Whereas you have an A quality single family home. The likelihood is you're going to get an A quality tenant. So the tenant grade notches down maybe just a little bit like one notch lower versus the class of property. You just get a better quality tenant usually in single family home. Not always. There's exceptions. I think plexes are fine. But the only real significant reason I think that you really want to focus on the plexes is because you can do what I said. If you have a 10 loan limit and you're looking to fill those 10 loan spots with those excellent Fannie Mae Freddie Mac loans. The Plexes are a way to build a larger portfolio with the same 10 financed property limit. That is the reason. That's I think, a big reason and that's a good reason to do it. But if that isn't your reason, because you said, Tyler, you were just starting out, you're probably not going to be doing 10 deals right away. It's going to take you maybe a few years to do that. I don't know your situation or how much cash you have. I'm guessing you might be a young guy and that's awesome. Then I don't think there's a hugely significant difference. For a more mature investor that's got more money and can do it faster. If they're working with us today and they're bumping right up against their 10 loan limit, then hey, by all means buy some Plexes because you can control a larger piece of real estate for the same loan limit. And that is significant. All right, there's a bunch more things I want to talk to you about, but we don't have time because we got to get to part one of this discussion on the Rantier class. I think you're going to find this very, very informative. And by the way, tickets for our virtual Meet the Masters keep on selling jason hartman.com masters also, we've got another live stream this Sunday on Facebook and YouTube. If they don't cancel, it cancel culture. So that will be running again on Facebook and YouTube on Sunday livestream. Join us live for Q and A. And you know, if I discover we have time, we might even do another one before that because we love the interaction and we love your questions. But jasonhartman.com masters oh, I know something else I have to tell you about Meet the Masters that I just booked. So our asset protection attorney that did the awesome webinar that so many of you attended, he will be speaking at Meet the Masters. But guess what? His speaking slot, like others, is not long enough. So we are doing actually what we're calling an extension class. And this is available to everybody who bought tickets for Meet the Masters and who continues to buy them. You don't have to be a VIP for the VIP tickets. You do get those two extra sessions with me. So those will be two extra meetings. Those are group meetings, of course, with me following Meet the Masters. Those are implementation sessions. So I'm looking forward to that. And we'll announce the time and everything at the event. But for our asset protection attorney, we are doing a 90 minute follow on class, another basically extension of Meet the Masters the following weekend where it's just going to be him, tons of Q and A to give him enough time. It might even go two hours long. So if you bought a ticket for Meet the Masters, just remember we don't want to rush this stuff because this has been a very hot topic. And so we're going to do a really in depth session on that the following weekend. So super exciting even for the general admission ticket. So jasonhartman.com masters for that. And let's get to our segment and talk about the rentier class.

It's my pleasure to welcome Evan back. We've got a few big topics to talk about today. We're going to talk about the rentier class. We're going to talk about people getting too dang greedy. We're going to talk about the big corporate tenants that don't want to pay their commercial landlords rent or don't want to pay the contracted rent. And we're going to talk about Florida's A grade getting an A, an A for effort in their coronavirus reopening strategy and more. Evan, welcome back.

Jason, it is wonderful to be with you. As always, so much going on even though we're at home, it's just nonstop action and work to do.

You know, I have been completely, I don't know, puzzled, envious. I'm not sure what, by people saying, well, you know, everybody's just sitting at home like they're not doing it. I'm so busy. Yeah. If I wasn't sitting at home, at home, I don't know how I'd get anything done. I mean, I need to be sitting at home right now. There's just way too much going on.

There is. There is. You know, and this is, this is the time, I think you've said this, that you know, good times make a millionaires, recessions make billionaires. Now, I don't know, you know, you don't need to be a billionaire.

Let me get you the exact recessions make millionaires, depressions make billionaires. And that actually, really, really is true because the world's first billionaire, J. Paul Getty, became a billionaire by buying cheap oil companies during the Great Depression. Not recession, Depression. And you know, the bad economic times always create monumental opportunities. And you know, we've talked about it. Look, we've talked about Joseph Schumpeter, my favorite economist. Economist and creative destruction. And we've talked about how like the Whole thing that was coming at us in 5, 8, 10 years is here sooner because we were forced to do it. Necessity is the mother of invention. Everybody in the world now suddenly knows how to use every teleconferencing technology, whereas before they were resisting it. And now that is making my quote from 2012, Evan, more meaningful than it's ever been. And what was that quote? Let me remind you, location is less meaningful than it's ever been in human history and now even more so. And so people are just going to be fleeing to quality of life areas like I talked about. John Nesbitt, the author of the Megatrends books in the 80s, said his big technology, why he could live in Telluride, Colorado, a beautiful ski resort, and didn't need to live in a city. Yeah, it's a great place and he didn't need to live in a city was because of technology enabled that opportunity. And the big technology was listeners Federal Express.

But I don't want people to misunderstand what you're saying. You're saying location, but you're still saying location is important. But it's not like you're not. You're saying that being in downtown Chicago or downtown New York isn't important if you want to have a successful career. And for those kind of business contexts, the fact the location is somewhat more important to be in a low density area, that, that is actually becoming more attractive. The conventional understanding of the importance of location, you know, being on the coast, you know, that's, that's not. Doesn't have the value.

Right, right, right, yeah, absolutely. You clarified it. Thank you for doing that. And I would say if you think you need to be in a place where you can get paid more for your career, if you need to be in Silicon Valley, New York City, San Francisco, any of these expensive areas that were the areas that really were the centers of the world for forever, really pretty much. Right. Or at least since industrialization.

Why on earth would anyone want to live in San Francisco right now? Unless that was the only place you could live? I mean, yeah, it's so expensive, it's dangerous. I mean, my goodness.

Yeah, no, I'll say it this way. No es necessito. Okay. Carmen can correct my bad Spanish. Okay. My good Spanish. But she's probably listening and her mom, our new listener, who I answered that question hopefully about newbies. You can invest, but you got to have a little buffer right now, a little bigger cushion. We don't want you coming to us saying, I just saved up my last dollar I've got enough for the down payment and closing cost. I'm ready. No, you're not. No, you're not. Go somewhere else because we don't want your money. Your money's no good here. You got to have a cushion right now. Times are a little uncertain, obviously, but I think there's great opportunity. So if you've got that buffer, that cushion, you should be buying up stuff like crazy right now. This opportunity is good and we all see this. You know what, in five years, Evan, everybody's going to say, you know, I was listening to Jason and Evan talk about this mass migration to the quality of life areas, to the suburbs, out of the cities. And that was like 20 million moves ago. Yeah. And now the prices have all gone up in the places that used to be cheap and they've gone down in the places that used to be expensive.

I remember you talking once recently about how you were going to buy a whole bunch of mobile home parks five or six years ago and you thought they were too expensive.

2011, that was nine years ago. Yeah. And I thought they were too expensive. Now. I did fortunately buy one and that's been a great, been a great investment. And by the way, it's interesting because that property has a restaurant and we've always been debating, do we keep the restaurant, should we get rid of the restaurant? And now that decision has become much easier. So coronavirus made our decision for us. We're definitely getting rid of the restaurant. And by the way, this mobile home park is, it's like a little bit of a resort. It's got like a beach area. It's got boat docks with and jet ski docks. You know, it's waterfront on the river. And we, we're building some kind of modular single family homes. They're nice, by the way. They're really nice. And so we're doing that on the waterfront area, getting the mobile homes out of that waterfront area and we can build three where the restaurant is.

That's great.

You know, he's my partner, is a client, Steve. Many of you met him at our meeting, Meet the Masters event or maybe some of our other events. So that's what we're going to do. So that decision became very easy. A la Corona.

The other thing, in terms of depression creating billionaires. And I think I have really noticed, you know, what Warren Buffett said, you know, when the tide comes in, you can see who's swimming naked or the tide goes out. Yeah. You know, you can see which businesses and which leaders are really creative and can really adapt to the table times and who really has the best interest of the customer. You know, I guess that this was a topic we were going to talk about greed. You see, which. Which leaders and which companies adapt, serve, figure out a way to thrive in difficult circumstances and which just can't. Which are just paralyzed and they don't know what to do. And I think that's the people who have that insight, that creativity, that hard work ethic, that's who survives. And then they make more money in the long run.

And it's the old metaphor of look at the trees that survive a big storm. I live in Florida. Right. What trees survive a hurricane and which ones fall over? Right. The ones that bend with the wind, that are flexible. They survive. And that, you know, you've got to be adaptable in an environment like this or really in life in general, you've got to be adaptable and you've got to not put too terribly much stock in whatever's going on. There's a great quote I like, and forgive me if I get this wrong, but it was like, in matters of fashion, go with the wind. In matters of principle, stand like a rock. Okay? And so that's the way to do it. So it doesn't mean sacrifice, ethics or principles, but when it comes to just some things you should just kind of be easygoing about and go with the flow. And other things, you should stand your ground and be really firm about them.

There's a wonderful store here in Chicagoland called ABT A B T which is sort of like a Best Buy, but infinitely better. And they have this sign all around the store that says the answer to any reasonable request is yes. And I think that that creates this ethic of we're going to figure out a way to make it work. Now, we're not going to give you this for free, but we will figure out ways to meet your needs. And I think that's a great attitude.

Yeah. Well, hey, we got a bunch of stuff to go through, Evan. And that's like, the customer's always right. If the customer's wrong. See rule number one.

So we got a bunch of stuff to go through. Let's talk first about the Rantier class. And I believe that's the way that's pronounced. And you said that came from my. Well, not my favorite economist, but what I say is the most influential economist.

Right, right. Karl Marx. Yeah.

I mean, my least favorite economist, but the most influential.

Oh, for sure, the most influential. I mean, we saw it in the Soviet Union, but He was critical of the rentier class, and in many ways rightfully so, because these were people that essentially their land was worked by serfs and they collected the profits. And people lived miserable lives supporting the landowners. And the landowners, they didn't earn the land, they just inherited it. And there was no social safety net back then. So people were suffering and it helped create this revolution. But he was so critical. What he missed is all the good things that private property does for people. It forces you to be efficient with your land when there's incentives and so forth. But yeah, he created that term.

Well, it's, it's really interesting and we think all of our listeners should aspire to be part of the rentier class. Okay.

Now, but we don't want them to be lazy. We want them to keep working.

Not like that, not like that. But Karl Marx and Bernie Sanders will probably still not like you. Okay, so. And they're pretty much cut from the same cloth. And Elizabeth Warren and Joe Biden aren't too far behind. But, but anyway, the concept is that, look, there's this age old debate and battle between what is the value labor brings to anything, any endeavor and what is the value capital brings. So capital is money, of course, but it's also land. Land is capital, or equipment is capital. And then there's labor. The people that come and work on the assembly line make the widgets work, the land, farm the land. Right. And so our society forever has been trying to figure out how to apportion the rewards correctly to each of those classes. And what's interesting is that you as a Jewish rabbi probably have a lot to say about this because there's a whole biblical thing about Jesus and the money changers and the Jews versus the Christians. And then the Muslims have some interesting stuff to say about this too, because Muslim culture, you know, there's halal banking and, and they don't allow interest, but they've found ways, ways around it. And forgive me, by the way, Muslim listeners, I'm no expert on this at all. I've read a little bit about it.

There are always ways around it.

Yeah, they basically, basically found ways to like lease things rather than sell them with interest. Right.

What do you have to say?

In Jewish law there's something called the sabbatical year, which is every seven years you're supposed to forgive all debts. And 2,000 years ago, yeah, exactly 2,000 years ago, the leaders of the Jewish community said that is impossible to carry out. Essentially, then no one would ever loan money. Especially as you get close to the jubilee year. This is sixth year. So what they did was they said during the seventh year, the debt is transferred to essentially an escrow. They called it the Beit Dean, which is a legal court. And you continue to pay your interest to the Beit Dean, to the escrow for an entire year, and then the escrow goes back to the owner. So they said, we're not going to change God's law. This is God's law. But we are going to adapt God's law law to our time. And, you know, it's interesting, we talk about the rentier class. For most of history in Europe, Jews were not allowed to own land. That's one of the reasons that many Jews became bankers, because they could loan money, but they couldn't own land and essentially created a different source of passive income, if we want to think of it that way.

And that was also the reason so many Jews went into the professions. Yes, because they couldn't get jobs. And so they had to go out and, like, hang out their own shingle, if you will. And so they really focused on education and getting into the profession. So it's interesting. But I don't understand that jubilee thing that you would pay on the seventh year when you should have a sabbatical. You kept paying. So what's.

Because it wasn't. It never happened. It was just a. Essentially, it was never followed because the rabbi said, if we follow it, we'll destroy economies. No one will ever loan money. So they would transfer, let's say I owed you $100 a month during the seventh year, you would transfer my obligation to a bank instead of yourself. So I would continue to pay the bank. And then after the seventh year was over, it would go back to you. So you weren't holding the debt on top of me. So they essentially. That was the way of getting around the law, right?

Yeah. Interesting. Okay, okay, interesting.

But they were smart to get around it because if that law was enforced, I mean, they argued. There's a whole argument in the talking about this that it would actually hurt poor people. Because no one would ever loan money.

Of course. Yes. See, you've got to have capital formation.

So that that money can be lent so that it can look at farmland, has to be financed before it can provide food. This is where Karl Marx went totally wrong and Bernie Sanders is totally wrong.

Totally wrong.

Yes. There needs to be a balance, and you've got to, you know, hopefully the free market can apportion the rewards. And the reason things are so messed up today is that we've moved away from the free market. At least that's my argument. Argument. We don't have enough of a free market. And that's the reason we have these like winner take all giant corporatocracy running the world is because it's too hard for a small company to get capital and it's too easy for a big company to get capital.

Yes.

Okay.

Yes.

So you put up all these barriers to raising money through the public markets, that is the stock exchange. And of course, the only people can play the game are the people that can afford the compliance, and that's why you don't have enough competition.

Horrible.

Yeah, it is.

Did you see that there was a movement when AOC was talking about Amazon not paying any taxes.

But I'm also upset about Amazon not paying taxes at the same time.

But somebody said, well, she was just explaining it. So she said Amazon pays no taxes at all. Which, I mean, because they reinvest so much and they still pay, their employees pay taxes, so forth.

But they also got a bunch of tricks going on too.

She got her degree in economics at BU and there was a movement to have BU withdraw her degree because she clearly didn't learn anything in economics.

There was a whole petition. That would be great. I would love to see that. That'd be awesome.

You know, it's complicated. I think some of the economic things, and we've talked about this, you've talked, you've taught us about this, are counterintuitive. I mean, Keynesian economics is counterintuitive in many ways, but in some way, even what we're going through right now is counterintuitive. To constantly throw money, throw money, throw money. But, you know, there are certain things. What did Keynes say? In the long run, we're all dead. So we kind of have to worry about the short run and make sure we can get through these times. And it doesn't seem right.

Keynes was a very influential economist also. Maybe I don't know if he'd be the second most influential, but he's right up there. And, and you know, he's not completely wrong. It's just that in my opinion, it's gone overboard, you know, government spending, as Kane said. Kane's concept was prime the pump. You know, you need to put. To make the pump work. Most people won't understand this, but listen, I lived on a farm for quite a while, and if you have a. Well to make any pump work, you've got to. You, you know, the gaskets won't. They won't they won't be tight if you don't put some water in there. So you gotta prime the pump with some water to make it start to work. And that was the Keynesian concept of, you know, priming the pump. Right. And so, you know, that's not completely wrong. But of course it goes overboard. This will be continued on the next episode. Thank you for listening and happy invest.

Thank you so much for listening. Please be sure to subscribe so that you don't miss any episodes. Be sure to check out the show's specific website and our general website, hartmanmedia.com for appropriate disclaimers and terms of service. Remember that guest opinions are their own, and if you require specific legal or tax advice or advice in any other specialized area, please consult an appropriate professional and we also very much appreciate you reviewing the show. Please go to itunes or Stitcher Radio or whatever platform you're using and write a review for the show. We would very much appreciate that and be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.