CW 232: Institutional Investors, Derivatives & Private Money Lending with Jessica & Zack

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 multimillionaire who not only talks the talk, but walks the walk. He's been a successful investor for 20 years and currently owns properties in 11 states and 17 cities. This program will help you follow in Jason's footsteps on the road to financial freedom. You really can do it. And now here's your host, Jason Hartman with the complete solution for real estate investors.

Welcome to the Creating wealth show. This is your real estate economics and investment reporter Jason Hartman talking to you about how we can all profit from the rather gloomy situation we find ourselves in in the global economy nowadays. And I think today you'll find this to be a very interesting show. We're going to talk about institutional investing, private money lending and just a whole bunch of things. So we'll get on with that. I've got a couple of guests here that I recently recorded and I'll put them on in just a moment. But hopefully you enjoyed the last show where we talked to Doug Casey. Some of you said he was pretty gloomy, pretty pessimistic and certainly agree. We're going to talk about doomsday scenarios today and we're going to talk about the derivative time bomb and you've heard about all of the derivatives out there on prior shows we've talked about this and how those are nothing more than maybe a house of cards. But I think you'll find this interview to be somewhat optimistic, frankly, because there's a little more to it than meets the eye. Throughout history it seems that every like doom and gloomer seems to get more attention than the positive person. Certainly if we look in the mainstream news media, if we turn on our television and do that, we know that bad news sells. The old saying is if it bleeds, it leads. Was it Don Henley wrote that great song about the bubble headed bleach bond comes on at 5, she can tell you about the plane crash with a gleam in her eyes. It's interesting, when people die, they want dirty laundry, right? And that is unfortunately just a truism about human nature. But I think you'll find this interview today to be a little more rosy and there's a lot of reasons to be quite rosy.

As Doug Casey said. I love the way he said it.

He said rather angrily on the last show, he said, but you can profit.

From this stupid stupidity.

And you can. You definitely can. Well, hey, let's talk about some of the stupidity right now. Recently, my friend Katie Sperry, who posted this great thing on Facebook, she talked about the federal budget, explained in simple English. And it's really, really great and easy to comprehend. You may have seen this before somewhere around there, but here's what it says. It says, I love it when complex things are simplified so that we can all understand. So here are the bullet points, folks. United States tax revenue. And I'm going to round off here for the sake of time. $2.2 trillion federal budget $3.8 trillion new debt $1.7 trillion. Now these are all with T's you notice. National debt 14 trillion. $14.2 trillion recent budget cut $39 billion. So those are the numbers. So you've got 2.2 trillion for our revenue. You've got, you got a federal budget that is about 3.8 trillion. New debt about 1.7 trillion. National debt 14.2 trillion. And you got a measly 38 or really 39 billion if you round it. Dollar budget cut. Now remove eight zeros and pretend it's a household budget. And I love this.

This was great.

What Katie Posted annual family income $21,700 money the family spent $38,200 new debt on the credit card $16,500 outstanding balance on the credit card $142,710. Total budget cuts, which some politicians are proud of $385. Stop the insanity now, vote them out and demand a balanced budget.

Isn't that great? Very good.

So Katie, thanks for sharing that on Facebook. And by the way, pardon my voice, folks. I'm fighting a cold. And note to self, whenever you're fighting a cold, don't go to a cold climate. I just got back from a business trip and it was pretty chilly there, about 27 degrees. So not the place to be when fighting a cold. Another interesting article comes from Conrad Allen and this was on the Active Rain website. And Conrad is a REMAX agent and I think he said something pretty interesting. It was a follow up to an NAR national association of Realtors blog.

And I think they have limited credibility.

And by the way, speaking of NARs, limited credibility.

So NAR is the, I believe, the.

Largest trade association in the world. It's got about 1.2 million members. So there's a lot of Realtors out there. I've been a member of IT for many years back when I was in traditional real estate and my company Open Door Auctions is a member of IT Now. I'm not personally a member, but NAR keeps a lot of great statistics. But recently they just admitted a huge error over the past couple of years and I don't know if you caught it in the media but, but it basically said that about they overestimated home sales because they counted many of them twice, they overestimated them by about 20%. So the market was really worse than NAR told us. Gosh, it's amazing. Anyway, here's the post on Active Rain from Conrad. Pretty interesting. Is inflation dead? NAR blogged about this. The CPI or Consumer Price Index has not risen in the last couple of years. This has hurt our seniors because raises in their benefits are based on inflation rising. NAR's Mr. Yun feels that inflation will be down compared to the last 30 years. Is he crazy? How can inflation go down when the government is printing money 24 7? How can inflation not go up? The CPI has increased 160% over the last 30 years. Let's just repeat that one. Okay folks, the CPI, the consumer price Index, the official statistics now this is just, just yours truly talking here has increased 160% over the last 30 years. Now that's the official numbers and we all know the official numbers for the CPI are totally underestimating what the real rate of inflation is. But 160% over the last 30 years, pretty darn bad. I think how inflation is measured is the issue. Rent has increased 202%. So do you see how rent outpaced the official inflation statistics? Rent has increased 202%. Food has increased 152%, gasoline 197% and the median home price 150%. Now of course the problem is like our talk with Doug Casey and with most experts. Those are national numbers. They're usually based off Case Shiller, which only profiles 20 markets and 14 or 15 of the 20 are lousy in my opinion. You wouldn't want to touch them. Only five or six of them are good. And by the way, we will be coming out. I've got my yearly forecast report coming out soon and I've been working on that the last two weeks. So we're going to get that out to you very shortly here, hopefully before the first of the year. And many of you, thank you for purchasing that over the years. We publish it every year and I think you'll enjoy that. But of Course, that's a national number, so we know how maligned that is. Because the old saying is all real estate is local. Now back to the article. These are the numbers reported by NAR. Inflation has averaged 5.3% a year over the last 30 years. The monetary policies of the US, the Europeans and others does not bode well for inflation. The US Government can and does create money out of nothing. We are a fiat economy. It is only the faith of others that the US will pay its bills that keeps this economy going. If the US loses credibility with the world, in other words with its creditors, this house of cards will come tumbling down. Now me talking again here. The article is almost finished. Just two more sentences. Just me talking for a moment. I disagree with that analysis and here's why I disagree with it. Because it is nothing more than a race to the bottom. Every global currency that I am aware of is a fiat currency. Fiat meaning by authority, by decree, just created out of nothing, just created out of thin air. So it is a race to the bottom.

And again, I've talked about it on.

Past shows, but you look at the US and you think the US is a total mess. It's a total disaster. We love to throw stones at the US government and fortunately we're in a free country where we have the First Amendment, we have freedom of speech, and.

We can do that hopefully without fear.

Of reprisal from our government. There's a reason the First Amendment is first. It's the most important one and it's just, it's nothing more than a race to the bottom. So you might look at the, the U.S. as the best house in a bad neighborhood and a bad neighborhood of monetary policy and currencies. So really I don't think there's very much difference between the US and most other countries out there. The fact that we have the largest military and the world's reserve currency and a lot of those benefits are very helpful and we probably have the strongest rule of law and the world here. And that is another thing that makes it a very attractive place for investors. So last two sentences, back to the article. Inflation allows this government to pay back its commitments with cheaper dollars. Well, sure it does. And you know what? Frankly that's a great business plan in my opinion. That's the business plan I'm encouraging all of us to adopt. I sure do it myself. Get long term, 30 year fixed rate mortgages, pay them back in ever depreciating dollars. Remember, part of my ultimate investing equation is denominate your assets in things in commodities, especially packaged commodities, rental properties sitting on cheaper free land that produce income and denominate your liabilities in dollars in fiat currency because those will constantly be debased by inflation. Last sentence. Inflation is alive and well and will rear its ugly head soon. And you know folks, another thing that I really like to do when I'm reading these different articles and blog posts around the Internet is read the comments. Now some of the comments are really just inane and stupid, but some of them are very good.

Okay, so just a couple of the.

Comments here from many, many, many. There were I think 45 comments on this article at the time I printed it off. Just ask the next economist and you'll get a different answer. Conrad I agree. We are spending more and more just to get by. Another comment. Inflation is alive and well. As you so aptly pointed out. The next quote crisis unquote will inevitably be when it starts truly rearing its ugly head again. The price of food alone is concerning. If things keep going this way, I won't need to think about dieting. I just won't be able to afford to eat. Conrad sadly, far too many senior citizens rely on social insecurity to get by. They will be the ones that will suffer the most. Another comment. Twenty plus years ago commercial landlords, in other words landlords that owned commercial real estate tied their rental increases to an increase in the cpi. Now smart commercial landlords now have fixed increases in their lease agreements and negotiate them with the lessee. So again, the commercial landlords aren't as dumb as they used to be. By relying on the official statistics or the CPI anymore, they're getting smarter and just building in their own increases. Or I've seen some of them do like CPI plus 2% or CPI plus 3% because then you're getting closer to the real rate of inflation. Another comment. Inflation. What about the cost of insurance, the cost of gas and the cost of heat, fuels and utilities? So look it, we see the reality of the situation. Inflation is here. Inflation right now is probably easily between 9 and 10% regardless of what the CPI, what the experts quote unquote experts say. Here's another comment. Yes, and if you check the price of gasoline in 1999 it was hovering around a dollar a gallon. That is a 220% increase in 12 years. Another comment. In the Obama economy more and more money is being printed or created electronically. The increase in the fiat money supply is the true definition of an inflation. And by the way folks, that is absolutely correct. The definition of inflation is the increase in the money supply, that is the academic definition for inflation. The thing that we all see is an increase in prices. But real inflation is simply an increase in money supply. It's not an increase in prices. An increase in prices is the result of the academic definition of inflation. Other comment here the price of groceries. Notice how sizes are getting smaller. A half gallon of ice cream is now one and one half quarts. A quart of mayonnaise is now 30 ounces. A half gallon of orange juice is now 3059 ounces. An eight ounce bar of dial soap is now five ounces. So you know, and I would definitely say that that is absolutely true. A lot of manufacturers of these goods, they don't believe that you will pay the prices. So what they do is they simply keep the package size the same but reduce the size of the contents inside the package. And we're all fooled, aren't we? So that that can of tuna fish, it is Instead of being 6 ounces, it's 5 ounces. Now just take a look and start noticing this stuff at the store. Very, very interesting. Hey, wanted to talk to you about hard money lending. Again. I love being a long term borrower, but I also love being a short term lender. I'm just getting paid off on another one of my private loans or hard money loans. Basically the same thing, hard money or private lending. And I loaned about $95,000 and in just 94 days I will get paid back an extra $3200. Talk about making your money work for you. Passive income. What a beautiful, beautiful thing. Now again, long term lending, not interested in that. The longest I would go out is five years. But these little short hard money loans where they're 94 days, I mean what a beautiful thing. If you're interested in this, just shoot me an email Jasonasonhartman.com and you may not be eligible for this. By the way, I do have to say that because this show is heard.

All around the world and there are.

Various legal issues and you have to live in sometimes the same state where you're making the loan and things like that. Again, I don't pretend to be a lawyer, I don't pretend to know all of these laws. But I will refer you if you shoot me an email jasonasonhartman.com I will refer you to the right party who can help you and help answer questions so that very very important. Take advantage if you can, if you're eligible of some short term private money or hard money lending can be a Great little adjunct to your real estate investing. Ultimately, I do like real estate investing the best still because it has the multidimensional characteristics that we've talked about so many times on the last 231 shows, basically. So the multidimensional characteristics of income property are better than lending. But for short term simplistic investing, I do like the private money lending. So again, if you're interested, shoot me an email and I'll hook you up with the right people who can help you with that. Also, Doug Casey on the last show, number 231 talked about nanotechnology and commodities. And I kind of had some time to ponder that a little bit. And I used to be a member of the, oh, what was it called? The World Future Society. I'd like to get them on the show, actually. But the World Future Society had a magazine called the Futurist. And I remember really enjoying the articles, reading about nanotechnology and all of the great new things that are coming our way through the miracle of technology. And nanotech is certainly one of them. Here's a distinction I want you to really start to make and constantly be mindful of. When we think about investing in what I call packaged commodities or assembled commodities investing, where we're basically getting the land for free in the markets we're recommending, not the national markets, not the overvalued markets, but we're basically getting the land for free and we're buying far below the cost of construction or replacement. And as such, when we do this, we put ourselves in a great position because although Doug, when I asked him about the commodities side of the real estate investment, he thought that nanotechnology might change that game. And I'm not so sure it will. It will definitely change the game in terms of more high tech items. Nanotechnology is going to make for incredible things. Tiny little, basically molecules that can be injected into our bodies through a syringe and have cameras on them, can monitor data about our body, can go through our bloodstream and attack cancer cells without attacking the good cells. Little tiny probes that will go into deep space that are maybe the size of a bullet, not a big spacecraft anymore, little probes that can go into space and take pictures and send back data, and can go to Mars and other planets far away, and all kinds of incredible things are coming our way. But the thing I love about the income property, the packaged commodities related to the income property, is that it's very unlikely that there will be a disruptive technology, in my opinion, because these materials are so simplistic. I mean, look it back on about Halloween of this year, October 31, 2011, we hit the 7 billion population mark in this country. 7 billion people. Amazing. Amazing how quickly the population grows. And when we hit that, you got to remember all those people need resources. They have three basic food, clothing, and shelter and shelter. Guess what it's made of? It's made of commodities. Packaged commodities. Concrete, lumber, energy, petroleum products. All of these things. And although some things will have disruptive technologies that really change the game, the way the integrated chip changed the game from the vacuum tube. Does anybody even remember what a vacuum tube is?

You go look at an old radio.

At an antique store or something, and you open up the back and there are tubes in it that have the air vacuumed out of them. And that was replaced by the integrated circuit or the integrated chip, right. And the microchip, you know, whatever you want to call it, intel inside. And so these are areas where it is very likely you'll have a disruptive technology, but in the very, very simple thing, unless we're going to live inside of a force field, and that'll be our future home, and it could be someday, probably far beyond the world of the Jetsons, because when I watched the Jetsons cartoon as a child, all their houses, even though they were floating in the air, were still made out of, guess what? Packaged commodities, building materials. And so I don't know that you're going to see any disruptive nanotechnology or any other type of technology in that world too much. But it's something to ponder. I'd love your opinion on it, by the way. And if you'd like to leave comments@jasonhartman.com please feel free to do so. Love to hear your opinion on that kind of stuff. Anyway, let's get to our guest. I recorded this interview just a couple of days ago, and I think you'll like this interview as we talk about derivatives, the derivative time bomb, how institutional and investors tend many times to overpay for assets. And by the way, I just want to clarify why we're talking about that. The reason we're talking about institutional investors like pension funds, insurance companies, REITs or real estate investment trusts, mutual funds, big companies, just where you might buy stock in them. The reason we're talking about that is because if you are not a direct investor, if you're investing in the traded assets, which of course we don't recommend, then you will fall victim to being part of that overpayment for these assets. So again, commandment Number three, thou shalt be a direct investor. Invest in things that you control directly be a direct investor. And so, you know, we're going to talk a little bit about doomsday scenarios and why they may not be true at all. So I think you'll like this interview. And we'll be back with that in just a moment. Oh, by the way, lest I forget, be sure to join us on January 7th in Phoenix. Register at Jason Hartman.com and join us for the Creating Wealth Boot Camp and our informal tour of the Phoenix property market. We've got two local market specialists lined up for you and we're going to be touring on Sunday morning, January 8th at 10:00am and you can also possibly meet with our local market specialists on Friday the 6th. And then the boot camp is all day Saturday the 7th. And we will get back in touch with you with hotel confirmations and so forth very shortly. But it will be very convenient right by the Phoenix airport. We're looking at the Hilton or the Hyatt place there and just kind of finalizing our contracts. So we will announce that very soon and we'll look forward to seeing you on January 7th. But again, if you come to Phoenix, if you fly in, there will be an airport shuttle to take you to the hotel. You do not need to even rent a car, just reserve your plane ticket. Now we'll get you a special rate on hotel. It looks like it's going to be around $89 a night. And we'll be back to you with that information on the very next show. If I don't talk to you before. A Merry Christmas to everybody. And we will be right back with the interview with our special guest in just a moment.

Now you can get Jason's Creating wealth in Today's Economy home study course. All the knowledge and education revealed in a nine hour day of the Creating Wealth Boot Camp created in a home study course for you to dive into at your convenience. For more details go to jasonhartman.com.

I'm here with Zach and Jessica and we are talking about institutional investing and why it doesn't really offer you the.

Returns that it should.

It doesn't offer the returns that a direct investor would obtain. And we're going to talk about the reasons for that and what happens when.

Big institutions with large pools of money.

Come into marketplaces, what they do to cap rates, what they do to investment returns, etc. And we're also going to talk about one of our markets, one of our.

Military markets and how it's kind of.

Flying below the radar, which I think you'll find interesting as well. We'll touch on property management and just several other sort of eclectic topics in this discussion. Let's start off. I'm going to ask a question here, and I'm in Kansas City, by the way. So we're talking about the Missouri market here mostly, but not exclusively. And it was interesting because when you picked me up at the airport yesterday, we were driving by this newly built apartment complex and it had a few hundred units. It was a large apartment complex, an institutional type investment. And you said, guess how much that complex is just about to be sold for. I guess this deal is not totally done yet, but it's in the various media and in the rumor mill here. And Kansas City's a small town. When you look at vertical industries, you know, when you look at, like real estate development, it becomes a really small town. Okay, it's a small city anyway. And he said, guess how much that's selling for. And I thought, well, I'm sure it's about 120,000 a door. That was kind of going to be my guess, but before I could even speak, you said 150,000 a door. And that's what the rumor is, at least not confirmed yet, but it makes perfect sense because the construction of those units probably cost about 8,80,000 a door. I'm going to guess something like that.

What happens is you've got these large.

Pools of money out there and the.

Money needs to go somewhere, doesn't it?

It does. What we're seeing with institutional money, when they come into markets, it really drives down the cap rates in a market with multifamily especially, we've been seeing that more and more over the past few years. I really contribute that to three main reasons. The first one is the interest rate environment we're in. Interest rates are extremely low, historically low. And whenever you have that cheap or low cost of funds or debt, it allows for a very low cap rate, a very low acquiring cap rate and still allowing the institutions to get reasonable yields that they're looking for.

So when you say it allows for a low cap rate, what you mean is that almost that money coming into a market because these institutional investors are buying product, they're buying property. And I couldn't believe the cap rate on this apartment building. I said, gosh, that investment stinks. It's like maybe a 6 cap. And you said, no, it's worse than that. It's 4.5 or 5 cap, which is awful. Now, just for comparison, especially if You're a new listener. The typical cap rates, and we don't really look at cap rate as the ultimate metric because especially when it comes to the smaller residential type investor who's buying small apartment complexes or single family homes or four plexes, whatever they may be, cap rate doesn't tell you everything. It's a very poor metric, I think, because it only evaluates price versus income. And of course you know that income property is a multi dimensional asset class and as such it's price, income, leverage, tax benefits, there are multiple dimensions to the investment and that's what gives you the return. But our cap rates are typically, I'd say probably, if you look@JasonHartman.com, the lowest cap rate on the website is probably right now, I'm going to say 9, 10%. And our usual cap rates are probably between 10 and 12%. So when you talk about an institutional investor accepting cap rates of 4.55 or even 6%, I mean, that is a lousy deal. And what happens is when money becomes plentiful, and we all know during the Great Recession that we're in, it's been sitting on the sidelines. Corporations are flush with cash and a lot of money has been sitting on the sidelines. And now it's starting to come off of the sidelines because the money has got to do something. You can't keep it in the bank or you are, that is the sure losing bet that is playing not to win by any objective standard because we know that banks are paying far less than even the official inflation rate now. So it's pretty amazing that they would.

Accept such low cap rates.

Yeah, it really is. There's a couple other contributing factors that I look for in that, and you alluded to one of them, and that is other yields or lack of other quality assets to invest their capital in. When you're sitting on pools of money and everything, they expect you to make money with it. You can't just sit on it long term because they're not making a return. Their time value goes down extremely quickly whenever they're not using it.

It's almost like, and this is one of the reasons government is so massively inefficient, government, oddly enough, the incentives are all in the wrong direction. So someone running some division of the government, the Department of Education, the Department of Transportation, their goal, the goal of these bureaucrats is they've got to spend their entire budget. If they don't spend their budget, guess what happens. Their budget gets reduced the following year and that right there explains the totally dysfunctional nature of government. No one's incentivized to save money. They're all incentivized to spend more, increase their power and do that. And the same is true with institutional investors. If they don't deploy the money, they don't get more.

They've got to deploy it.

So they tend to deploy it in less acceptable ways because remember, it's not their money. Now of course they want to earn a high return for their investors, but again, they've got to deploy the money. This is why being a direct investor just makes so much more sense, doesn't it?

It really does. And with the multifamily outlook and everything and the cheap cost of debt, you really see, obviously the institutions have a really positive outlook on the long term. With multifamily you could contribute some of that to an inflationary environment where multifamily to tends to do very, very well in. Especially when they have long term interest rates that are 4%, 4.5% potentially on some of their debt. They can accept a low cap rate because they believe there's going to be rental rate growth. When you see all that, potentially that's the only way you can really justify that. It makes sense for them potentially in the long run.

Yeah, you're absolutely right. They are right. Also, I just watched a little short video today that talked about how in numerous Cities around the U.S. renters are paying 5% more than homeowners now. So if that isn't a sign of a couple of things, number one, that ultimately there will be some appreciation pressure on prices of homes and apartments. But the demographics coming at housing right now are nothing short of phenomenal. Probably the best they've ever been in history because you've got 80 million Gen Y ers, the largest demographic cohort ever in America, 4 million larger than the baby boomers. They're coming into their prime household formation years, so they're going to be renting first, buying later. And you've got retiring baby boomers who are liquidating stock market assets. Okay? And that's one of the reasons I think the stock market is completely puffed up in terms of real dollars. Now in nominal dollars we'll see. But in real dollars, I mean the stock market is just an illusion.

Okay?

But it's interesting because I kind of look back and I Compare this to 1998, 1999, 2000, during the DOT com bubble. And what happened during the dot com bubble. I mean I remember and I think I have this videotape yes, it's a tape somewhere of a CNN story called getrich.com and it was about all these people making just ridiculous, absurd amounts of money. If you just started acompany and stuck.com after your name, venture capitalists were flocking to give you money and they were.

Giving you stupid money.

And I remember visiting a couple of these companies that just did the most sort of inane things. I visited them because I had filed for a patent on an Internet business process back then that would basically create and distribute news releases. The only time I've ever filed for a patent. That was an interesting process to learn all of that. And I went to some of these companies and you know, of course they had the requisite Ferraris and Lamborghinis out front. And I mean, these children, okay, they were, they were children. And I don't just mean children in age, but children in maturity. They were just immature people, okay, largely who had a bunch of money thrown at them and they were just hiring people that they didn't need. They were spending, I mean, their offices.

Were gorgeous, brand new, Herman Miller highest.

Top of the line furniture everywhere.

Just stupidity.

Not the way real people run a real business. And they had no earnings. And still they were getting more funding. And instead of talking about your earnings and your profit and loss, they would talk about your burn rate, what is the burn rate of your company? And companies were being sold at 20 times earnings. And they had no, I mean 20 times infinity. They had no earnings at all. It was just completely dysfunctional. And.

There is a hint of that that happens with institutional investors because they've got to put place money and they're under extraordinary pressure to do that. And the whole point of this conversation, folks, is that you, many times, hopefully you're not, but most of your friends are the investor in these institutional pools. They bought a reit, a real estate investment trust. They own shares in that. They own stock in an insurance company. They bought a stupid, silly life insurance policy that isn't term insurance. And it's one of those quote unquote investment type policies which are a complete scam if you ask me. And we've talked about that on prior shows and it just gets really dumb. And what's interesting about this, Zach, is that you and Jessica, and we ought to have Jessica talk here, she's going to talk a little bit more about the market and operations and some property management here in a moment. But you are working on your largest deal ever now. And that deal is like a $30 million project, right? And so Tell us a little bit about that and what you have experienced in talking to large, big players, big institutional investors. Because I think it ties in with this conversation.

Doesn't, definitely does. And it is a part of my project and it is right around the $30 million range. One of the big things is that you've got to, when you get into that range, you've got to crack the nut, I always call it, as far as getting big enough to attract institutional money. And when you do that, it's very interesting how they look at things completely different. Our returns, you would think a $30 million project, apartment projects and everything else, you would have a huge economy of scale and everything else and your returns would be really, really good and everything. It's actually not comparing to the smaller investments and the smaller investments we refer to this, I think you've used the terminology before, flies under the radar. And whenever you have smaller investors, you have $50 million to deploy or $300 million to deploy on multiple projects. Well, you can't get down into 2 and 3 and $400,000 deals. So in turn, the returns on those stay much larger.

Even worse, you can't get down to three million dollar deals. I mean, you just can't do it. It's just too hard to manage so many small deals. So the institutional investors, they have to look for stuff upwards of really 5, $6 million and up, up, up, up, up much higher than that. And they'll accept such low cap rates. It's so interesting because I subscribe to all of these different email lists of different commercial brokers all around. Well, I was going to say all around the country, all around the world. And I see their very corporate stuff that they send out and the investments, once in a while I forward them to you and to Doug and some of the other people in my sort of inner circle of advisors. And one of them, they're saying, you know, here is a B of A branch that you can buy on a triple net lease and the cap rate is like 5.3% and it's B of A. This is a company that is essentially insolvent, or the worst one ever was Blockbuster Video. How a commercial broker can go out and peddle Blockbuster Video stores, freestanding stores on triple net leases, that is beyond me. It is complete fraud because Blockbuster is. Are they completely gone? I haven't seen one lately. Almost completely gone. Jessica, you're not saying anything here.

What do you say?

Well, they're just mostly kiosks now, but.

Yeah, it's amazing though, how they can do that and even at such low.

Cap rates, it's ridiculous.

Yeah, no, I know, I know. Well, I want to weave some more of this discussion about this in here, but let's talk a little bit about like we talked about the St. Robert Market before, and it's just such a great opportunity. I was just there with you a little over a month ago and Jessica is working on a lot of the operational details of the business now. And I got to tell you, I was really impressed with your team there. We had lunch, we spent several hours together driving around looking at different properties, took a lot of video and so forth and had a lot of discussions about it. But what an impressive market. And again, totally below the radar as the expression goes.

Right.

So, Jessica, what are you up to nowadays in terms of the operational details and things like that?

Well, we're sort of a unique company, especially for the area. We are a vertically integrated company. So what that means for our clients is we have our investment segment, we have our construction and development, and then we also have our property management. So we take our clients through each step. And most important, I think is the property management, because that is what makes the investment.

Couldn't agree more. So it's kind of like our saying is the complete solution for real estate investors on a macro nationwide scale. Well, yours is the complete solution for real estate investors on a local scale. And what are you seeing out there in that marketplace? And you know, Zach will probably want to chime in on this too, but in terms of the staff, I mean, what's the vibe? What are their feelings, what's happening in terms of how quickly things are renting and how that market's going?

Well in our particular area and with our company there, the property management, we are first and foremost property management and we're real estate second. And that makes us very unique and gives us a unique position in that area. When we have other brokerages that we're competing against, they just passively accumulate single family homes. But we are the area's largest multi family property.

Right, right. So they all dabble in them and do every other kind of real estate jack of all trades master have done. But your model is very specific and it's almost exclusively, not exclusively geared toward investors. And we've been doing business for several years and our investors are coming from all over the world and oddly investing in a town they've never heard of before, they checked it out and you know, they've come out to look at properties and so forth, and they're just as impressed as I've been, I'm part of that little 10 unit deal that we've got there and just working really, really well.

No, exactly. And we've got some really in depth market studies here recently that the 2010 census came out and everything. So we went back and did some analysis on the supply of housing and how that has increased over the past two to three decades and how the population has increased. And what we've seen is like a 27% population increase over the past five years and the housing supply has not.

Kept up with that.

And we get really in depth on that. And the whole analysis kind of the end result is what we've seen is a housing shortage of approximately 2,000 to 3,000 units in the area. And that's including single family home buyers and rental properties. If you look at probably a 60, 40 rental ratio, 60% renters, 40% home buyers in the area, that puts US at about 14 or 1500 units short in the area.

And tell them the reason that the renter population is so high. Because it's transient. Right. You want to talk about that a little?

Absolutely. And with the military population, typically they're there for anywhere from one to three years, which typically most. Even if the cost to buy a home is cheaper in the area, they still will not buy because you can't recoup commissions and everything else in three years time just because you're not in that big of an appreciation type market. So typically they will still rent even if they're going to be there for three years, which in turn that yields a very strong rental market, especially when you look at the number of people coming through the area and the number of potential renters that you have to tap.

So Jessica, in terms of what you've been working on in St. Robert, tell.

Us a little bit about the structure.

Of your staff and so forth out there if you would, just so the investors can learn a little bit more about that and who does what and just kind of how it all works in terms of that complete solution.

One of the kind of neat things that we, we have been established there and so we do have a great tool we use for all of our rental properties. It's a software that does all the tracking for us. So something kind of neat that we do with our staff is we do track all the properties that we do have coming in and also the type of residence and how long they are staying there. So we do have pre leasing sort of forms. So we are capturing people coming into the area maybe six Months in advance. So that's something that's really important for our staff. I'm actually making that the most important thing for them to be focused on at this point is capturing those renters that are coming in so that it closes up that window and that gap between turnover.

Right. And you wouldn't have that opportunity in a non military place. So you're basically digging your well before you're thirsty in terms of lining up these renters a half a year in advance and getting them nurtured and getting them ready to go so that when you have the right property for them. Very interesting. What else would you say on this institutional subject? Because I think it's so important and why they're missing. Like it just. I always think about it as to why you don't see Goldman Sachs or any of these rotten big institutional companies in this market. And I always say to our investors, this is such a fragmented business, it's just too hard for them to manage. Now you do see hedge funds buying properties and flipping them, buying big bulk.

What they call tapes.

And that came out of the Depression.

A tape is just a list of.

Foreclosure properties that are real estate owned by a bank. They used to be on a tape, I guess like a ticker tape or something. All the addresses, I don't know, but that expression tapes came out of the Depression from what I can tell. And you see them buying big pools of properties and reselling them, but you rarely see any large pools of money in the buy and hold business. And I think the buy and hold business is the ultimate profit, the ultimate wealth generator for an individual investor. And it's just too fragmented for institutions to get into. So that leaves the opportunity for us. So I would say embrace the fragmentation because if it wasn't fragmented, we would see a lot more competition from institutional investors, wouldn't we?

Absolutely. And what we've seen in getting into the institutions that do buy and hold, they want the bigger markets. They can't deploy enough capital coming back to the amount of capital they have to deploy. They have a fixed amount of overhead on every deal that they take on and every deal that they invest in. So when you look at their fixed time investment, they have to deploy a certain amount of capital. Even if the investment goes well, if they don't deploy enough capital in it, it never moves their radar. It never even comes up on their radar on a big fund. Even if the investment goes great, if they've only deployed two or three million dollars on a half billion dollar fund or Something they have to deploy a lot. So that in turn typically and virtually always yields bigger markets because you have to have bigger investments. So in turn that means a market like ours, you're not really going to ever see big investment institutional money come into it, which is a great thing for small investors because when you do that, the cap rates stay higher, you don't have cap rates driven down. And in turn that keeps the fragmented business and allows for opportunity for the smaller investors. So what we've also tried to do though, there are pros with the bigger investors and a lot of that is economies of scale, control over a lot of different things, streamline processes and everything. We try to take the positives with the bigger investors, institutions and the things that they have, advantages, competitive advantages, so to speak with them, and try to implement those on a smaller scale for smaller investors. And we do that by keeping our product very similar. I don't want to use the term cookie cutter necessarily, but by using the same product a, we create a history and a track record with that product that's very predictable. We know what it has done over the past few years, which in turn means you're not going to get something that's a high risk, brand new thing that you nobody's ever tried. It's very proven, which is if you look at institutional investors and you're looking at REITs and stuff, all they can tell you is their past history. Whenever you're looking at publicly traded stuff, they all do the look back. So if you use that same analogy on this, we're creating a very similar product that we've had success with. When you do that, you take a whole layer of risk out of the whole investment process. When you have something that's been proven time and time and time again hundreds of times over for the past few years, that is, that takes a whole layer of risk out. So by doing that along with using the same similar units, we streamline all of our marketing, we streamline all of our renting, all of our leasing. It allows for us to pre lease if we had a portfolio of 500 units that are all fragmented units within our portfolio. You can't pre lease because you don't have any consistency of what's coming available. So by having the same product coming available, we know we have X amount of the same two bedroom unit coming online or that should be coming open six months from now. We can start taking pre leases 3, 4, 5 months in advance if that opportunity is there. Which in turn all that equates to a better Bottom line for the investors because of decrease of vacancy, decrease in turnover, costs, all those different things, we feel like we've really taken the best of the institutional world and implemented it on a smaller investor type scale and left behind the bigger institutional drawbacks.

Let me take a brief pause.

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That's 1-800-405/2766. Your investments could be gone tomorrow. Protect yourself and act today. So two things from that that I just want to point out and kind of maybe clarify to what you were just saying. Number one is the deal has to be large enough to move the needle. And the stuff we're talking about on the show, it's just not large enough to move the needle for a big fund or a big institution. So again, that's why you have the opportunity for higher cap rates, higher rates of return, higher cash on cash return, just better in every way than an institution is going to get. And you're not going to pay some fund manager massively disgusting criminal fees off the top for managing the deal. I mean, you're really going to avoid by being a direct investor the three major problems you have when you relinquish control of your financial future to somebody else. Number one, you might be investing with a crook because you're in control. You're not giving it to anybody else. So that's the number one problem. The number two problem is you might be investing with an idiot so you could lose Money because of their malfeasance and their graft and corruption. Or you could lose money because of their sheer stupidity and their mistakes. And number three, you can lose money. Assume they're honest, assume they're confident. You can lose money just because they take such large management fees off the top. And you know, I always go back to Lou Dobbs book War on the Middle Class, which was just a great book. And he said in there, he cited a whole bunch of cases in the stock market, in the public markets. And one was Larry Ellison, founder and CEO of Oracle. And he said from like, forgive me, this is from memory here, but it's pretty close and you can just look up, the book is called War on the Middle Class by Lou Dobbs. But he said in the two years from 2000 to 2002, Larry Ellison personal take from Oracle was like $860 million or something like that. Almost a billion dollars in two years. Not bad, right? Yeah, I'll take half that. I'll work for half that amount. That was his take in two years. Yet in the very same two year period his shareholders lost 61%. And that's totally legal. That's just an example of huge management fees taken off the top robbing, just stealing from investors returns. How can you take almost a billion dollars out of the company when the investors lose 61% in the exact same time period? That's crazy that that is legal, but that's our system, okay? So do with it what you will. And then the second part of it is with institutional investors coming in and they've got to move the needle. But also coming in and accepting these low cap rates, it reminds me, reminds me of not just the dot com.

Era, but the era when I sold.

My traditional real estate company about six years ago to a Coldwell Banker affiliate. And back then during the heyday of the real estate market where it was just going crazy and it was completely illogical. A good economy. You know that old saying, a rising tide floats all ships, it raises all ships. Well, it also raises a lot of stupid ships.

And people get really dumb and careless when much is plentiful. Just like they did with the VCs in the dot com era. But back then, every independent real estate company owner, they were like the smart ones were just designing their company to be sold to Caldwell Banker because they knew Caldwell Banker would frankly overpay. And they did. I saw it so many times in our market. They bought a couple of other big real estate companies in the Orange county area and it just seemed like they were just overpaying for these. And undoubtedly the deal was, the edict was someone in that company said, we've got to expand our brand. We've only got a couple ways to do it. We either open new offices ourself or we buy existing companies. So here's a big fat budget. Go out and buy companies and essentially pay whatever you have to within reason. And they did. And they just bought up companies like crazy. And then the guy who was on the buying spree with the company, I heard like by 2007, I think it was, he got fired. So you get to use all the money for a time and then they ultimately ax you. So he was chopped off there.

But the other part of it is.

And you alluded to this and what.

You were just saying, people in the.

Stock market and in the traded asset world, whether it be stocks, bonds, mutual funds, REITs, real estate, investment trusts, the thing they say that I hear them say over and over as to why they don't like real estate and they love the traded assets like stocks. They say I can go to my computer and with a click of a mouse I can deploy money or I can sell and I can get my money out and turn it into cash with a click of a mouse. And they love that liquidity. And they say that's the reason they just don't like real estate, because it's too illiquid. So here's my quote for the day.

Liquidity creates volatility.

If you have liquidity, you have volatility. And when you were talking about the rental market in St. Robert or in any place, it's just so non volatile, it moves rather slowly and it's just a very predictable thing where you're not subject to rumors of what's going on with a company's CEO. Did they write on a blog post like the Whole Foods guy did a couple years ago? He made this blog post and got in trouble for it. All these just crazy silly things that happen in companies because they're the sum total of a bunch of behavior of a bunch of humans. You know, what lawsuits are they in? What's happening with their investment banker and their brokerage house and their rainmaker and all these other people. It's just a really simple business and I think it's almost too simple. And people who consider themselves to be very bright or very educated, which are not the same thing, by the way, bright and educated are different. Sometimes they go together, sometimes they don't. But they consider themselves almost too sophisticated for these simple, silly Little investments that are frankly creating wealth for more people than anything else. Any comments on that?

I understand the appeal to just click a button and, you know, start investing. But personally for myself, I like a little bit more control over my money. So investing in something like what we are doing in St. Robert makes sense to us. It's something proven, it's something you can do due diligence on it. It is a little bit more work up front, but after that, it's pretty passive. Our property management staff down there takes care of everything.

That's a good point. The first word in real estate is real. It's something real. It's not a paper asset, which is just a fiat currency. It's another form of fiat currency. Fiat, meaning by decree. It's valuable because I said so. And that's what the dollars in your pocket and every currency in the world virtually is a fiat currency. And that's what stocks are. They're just paper, they're just fiat. They have the value the market gives them. And that some investment bank originally said, this is going to be the value of the stock, this is what we're going to sell it for. And then the market starts manipulating it from there. And I don't say manipulating in necessarily a bad way. I like capitalism, certainly. I just think that you should be in control, like Jessica said, of your own financial future, by being a direct investor.

Exactly. And to expand on one other thing, you, you were talking about the attractiveness of the liquidity. Everything has a pro and a con to it. Everything has a reciprocating. Everything has a reciprocating positive, has a reciprocating negative. And with that liquidity, one thing you mentioned was obviously the volatility, but also lower returns. When you have that much liquidity with something, it typically drives down returns because it quickly drives money into it. So the supply coming into something, obviously the more supply of something. Money coming into something drives returns down, just like we were talking about with the bigger institutional investors.

Supply and demand.

Yeah, supply and demand. Simple economics. So when you have that, that's another trade off of that liquidity that you're getting. You're also getting lower returns, generally speaking. So that's definitely another pro and con.

One more thing I want to just talk about for a moment, and we should do a whole show on this sometime. But we had an interesting conversation at dinner last night when we were enjoying some barbecue, Kansas City barbecue, and that was a conversation about derivatives and the doom and gloom scenarios. Any of you that are listening to this show you might also be listening to my holistic survival show, which is a very negative show, but it's by design because I have this morbid curiosity about the end of the world.

I guess. So the holistic survival show, if you don't listen to it and you suffer from depression or are on medication or anything like that, do not listen to the show. Okay, alright. But on that show, you know, I have all these like doom and gloom bears, the people that predict a very bad future. But what we always do is try and ferret out the silver lining in the cloud because there's every problem creates an opportunity. The Chinese symbol for crisis and opportunity are the same and literally translated it means crisis is an opportunity. Riding the dangerous wind. I remember I had this one employee years ago and I would always say he found the cloud in every silver lining. Some people are like that. The best way they can brighten up a room is by leaving it. And so anyway, the holistic survival show, this is really almost a topic for it. But we were talking about the doomsday scenarios last night and we were talking about the derivatives bubble and I've had several people on the show talk about that. And you brought up a very salient, very interesting point. And we were talking about the size of. Nobody really knows. But if you look at the size of like economies, I mean what's. The GDP of the US is around 12 trillion a year.

Right.

The US debt's around 15 trillion. Now just since Obama's been in office, it's gone up by like 50%, like 5 trillion. Just under Obama only. And he's not even finished with his first term.

Okay.

Hopefully it'll be his last term. But then you look at the global gdp, all goods and services produced on the entire planet, about $60 trillion. The entitlement obligations of the U.S. government, about 60 to some say 100 plus trillion dollars.

So that gives you a size perspective.

Of what we're looking at when we talk about this. Now some people have talked about the amount of derivatives out there in the world in all of these. And the derivatives are just a. It's almost hard to explain what a derivative is, but many people already know. But it's basically something that follows something else. That's kind of one way to say it. It's not the thing itself, it's the thing about the thing. I don't know if that's. I'm just kind of making this up here.

Something else. It's derived from something else. That's not the word.

Right. So it's derived from something else. It's the thing about the thing. I like mine better. The thing about the thing. Okay, so the thing about the thing. What is the value of all the things about the things? Okay, they're not the things themselves. They're not the commodities. They're not the soybeans, they're not the coffee, they're not the oil, they're not the gold, they're not the silver. They're not the construction materials. They're not the pork bellies. They're not any of that. They're the thing about those things. And the doomsdayers talk about the derivatives as being the big shoe that's about to drop. And they say they estimate the value of all the derivatives in the world at like 300 to maybe 600 trillion, with a T dollars. In other words, 5 to 10 times.

The entire GDP of planet Earth.

Wow, Big numbers. Okay. And you made a really interesting point about that last night. And no one on my holistic survival show talks about this. They all talk about the negatives and the scary part of it. And the numbers are scary as heck.

Right.

But they don't talk about what is true, which is what you brought up last night, and I'll let you make that point.

One thing we were talking about with all the derivatives and the amount of them, like Jason was saying, the things of the things are. The things about the things are typically tied to are an obligation to buy or an obligation to sell or something tied to the price of something else. An underlying asset typically is what it's referred to. So all those contractual obligations, like he was saying, have been estimated to be anywhere from 300 to $600 trillion. Well, what they don't ever mention is that when something goes wrong and those contractual obligations need to be met, those derivative contracts need to be met and fulfilled. And that's why he's talking about when there's 3 to $600 trillion, those are obligations, contractual obligations that have to be met in the event of something else happening. And for that to happen, typically there's a reciprocating. We were talking about pros and cons earlier. There's a reciprocating. A lot of times you have reciprocating derivatives on both sides of a commodity.

The short and the long.

The short and the long. Exactly. And whenever you have that, a lot of the doomsday scenarios that I've heard are what happens if everything goes terrible? Then you have 3 to 600 trillion dollars of obligations that are being called and trying those Obligations are trying to be met by incident institutions. That definitely bankrupts every institution in the world for the next 10 years because it zaps all GDP technically. So when you look at the size of that, it can become very overwhelming very quickly when you look at the size and scope of the potential for that. But whenever you have a reciprocating transaction on both sides, a derivative on both sides of an equation, you have a.

Counterparty transaction, you have a counter transaction. For every seller, there's a buyer. So if someone loses money, someone is making money.

So you can't have all those obligations be called at the same time. When you have a counterparty transaction like that, if something goes down in value, then somebody's making money on that and somebody is fulfilling the obligation. But somebody is also making money on that same transaction by shorting something. So it's not always perfect. And the other thing about the derivatives is that they're tied to so many different assets. Everything. Everything from currencies to commodities to real estate to everything. And whenever you talk about 300 to $600 trillion of obligations, that's across every asset class that there is on earth. And you would have to have all those things go wrong at the same time and not even taking into account the counterparties on both sides of those transactions. So I'm a naysayer to the doomsdayers, if that makes sense. I can't fathom that everything could go wrong at the same time like that. It's actually, actually factually impossible.

Yeah, and that's a good point. So every generation. And I brought this up, and this is how we got into the conversation last night. Every generation laments that the times in which they live are the most pressing, dangerous, risky times. And, you know, I think back to the 70s. And last night when we were at your house, we watched the Jimmy Carter malaise speech and on YouTube and boy, he was just a disaster of a president. But I do think Carter was like an honest man.

I think he was a good man.

He was just a lousy leader. But every. I mean, look at what happened in the 70s. I mean, in the 50s, people were building bomb shelters. And I know this because I watched Happy Days as a kid. And I remember Fonzie and Richie would make out with girls in the bomb shelter that the Cunninghams had.

So they were building bomb shelters. They were afraid of polio and nuclear war. In the 70s, it was starvation and Soylent Green. And remember all these crazy movies that were out in the 70s and the end of the World and Gas lines and energy shortage. I remember on the freeways that half the lights would be off or none of the lights would be on on the freeways and the streets. And it was all just like, somehow we made enough electricity. And we've got. We use a lot more today, not by population, but individually because of all our gadgets.

They've been talking about running out of oil for decades now.

The peak oil theory, which may or may not be true, but then there's a counter to that. There's alternative energy, of course. There's the abiotic theory that the Earth actually produces oil all the time.

New technologies are always being produced to derive more oil from.

Yeah, from oil sands and extraction. Yeah, no question. So there's all these things, and every generation looks as though this is the end of the world. And I remember Dennis Whateley, who was on the show. He was a big mentor in my life when I was 17 years old, he said, he quotes this story, and I can't remember it, so forgive me, but the headline of it in the Boston Globe, I think it was in, like, 1860 or something, was, world to go dark, oil blubber scarce. They were running out of whale blubber. Sorry, did I say that? Oil blubber. They were running out of the oil to run the lamps. Right. And so the world was going to go dark, and somehow it didn't.

Right.

And there's all these doomsday scenarios. And I just think that I'm beginning to think, after interviewing all these people on my holistic survival show, thinking that I'm going to jump off a bridge myself because I'm interviewing all these people that all these scenarios, they're just not going to play out like that because there's just more to it. And it seems like everybody, when they come out with the doomsday thing, they're only looking at one side. Now, certainly wealth will be transferred, and it's already being transferred. We are in the midst now of the largest transfer of wealth in human history, and that is bad. And the Occupy Wall street movement has been grousing about that. And, you know, they're right. I mean, they're right that the 1% are getting much richer. And it is unfair in a lot of ways. And I'm not a socialist, and I say that, okay, but certainly wealth is being transferred, and the cups and the assets, they're moving around on the table. There's no question about that. So by listening to the show, you have to position yourself in a way to win with this wealth transfer. The way you do that is through the ultimate investing equation. You buy what I call packaged commodities investments. You buy these houses, you buy them, you get usually free land, and you buy a bunch of construction materials and you finance them with other people's money. And inflation comes along and increases the value of the commodities, the construction materials, and it decreases the value of the debt. I recently interviewed Doug Casey on the Creating wealth show and he talked about how we could easily have 100% inflation annually. Think about what that does. If you owe $1 million on a piece of real estate in one year, inflation has destroyed the value of that debt. You owe nothing, in essence in real dollars. So what an opportunity. Get into debt as fast as you can.

As long as it is debt attached to commodities and it's long term fixed debt. So responsible debt, yes. I'm not saying go run up your credit card. But even then, even then the problem is the interest will kill you before the inflation hits on that one. And you're not, you're not buying things that produce income. But even then those people will be helped a small amount through what's probably coming and coming. Pretty bad. It's going to be pretty bad. So that's the point. It's not like it's the end of the world. It's just the end of the world for people who are unaware and uninformed and don't know how to play the game. The game is always changing. We just have to adapt to those changes. Any closing comments on that?

No, I just completely agree with everything you were saying. The game is definitely changing and it's continually changing. We go from industrial era to technology and the dot com boom. You mentioned all that. And things are consistently changing and it's changing very, very rapidly. And that's not going to slow down, it's going to speed up. Definitely speeding up.

Yeah, good point. I think that change happens faster nowadays than at any time in history because communication happens faster. And an economy is just a result of like when we had Robert Prechter on the show talk about the Elliot Wave theory. He writes a lot about the psychology of investing and how people enter marketplaces, whether it be buying a cup of coffee or buying coffee beans on the, the commodities exchange. They enter markets, they experience certain emotions, ups, downs, wins, losses. And then they share those emotions with other people. And then other people act based on other people's emotions and it creates what we call an economy. And so the economy is the sum total of really people's thoughts and emotions and mostly emotions, I'd say Hence the misery index. Look at Jimmy Carter, right? Yeah, absolutely. And so that's the opportunity we have is to really just understand that and make it work for us. And that's what the show is all about. So, Jessica and Zach, thank you for joining me today and this totally impromptu conversation. We went all over the board, as we usually do, off on many tangents, and it's just kind of a good topic to talk about this stuff. So thanks again.

I've never really thought of Jason as subversive, but I just found out that's what Wall street considers him to be. Really?

Now, how is that possible at all?

Simple. Wall street believes that real estate investors are dangerous to their schemes because the dirty truth about income property is that it actually works in real life.

I know.

I mean, how many people do you.

Know, not including insiders who created wealth.

With stocks, bonds and mutual funds? Those options are for people who only want to pretend they're getting ahead. Stocks and other non direct traded assets are a losing game for most people. The typical scenario is you make a little, you lose a little and spin your wheels for decades.

That's because the corporate crooks running the.

Stock and bond investing game will always see to it that they win. This means unless you're one of them, you will not win. And unluckily for Wall Street, Jason has a unique ability to make the everyday person understand investing the way it should be. He shows them a world where anything less than a 26% annual return. Disappointing. Yep.

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To protect the equity in your home before it disappears. And how to outsource your debt obligations to the government. And this set of advanced strategies for wealth creation is being offered for only $197. To get your Creating Wealth Encyclopedia Book 1, complete with over 20 hours of audio, go to jasonhartman.com store if you want to be able to sit back and collect checks every month. And just like a banker, Jason's Creating Wealth Encyclopedia series is for you.

This show is produced by the Hartman Media Company. All rights reserved. For distribution or publication rights and media interviews, please visit www.or email mediaartmanmedia.com nothing on this show should be considered specific personal or professional advice, please consult an appropriate tax, legal, real estate or business professional for individualized advice. Opinions of Guests are their own and the host is acting on behalf of Platinum Properties Investor Network, Inc. Exclusively.