CW 624 FBF - Wall Street's Rigged Game Against Main Street USA

This show is produced by the Hartman Media Company. For more information and links to all our great podcasts, visit hartmanmedia.com.

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 the Creating Wealth Show. This is your host, Jason Hartman.

Thank you so much for joining me today. So a lot of stuff going on.

Many of you have asked me what.

Do I think and why have I not talked about Occupy Wall street and all of the Occupy movements that are spreading all around the world. Where do I fall on this issue?

Well, it might surprise you where I.

Fall on this issue of the Occupy.

Wall street thing because it's interesting, we've got like these two sort of polar.

Opposites in the news media. And it's interesting because the Occupy Wal movement is purported to be against corporations and against capitalism and against business. And that's how the right wing media that I agree with more often than not, I guess to some extent would have you believe. And then you've got the left wing media that says, well these corporations are abusive and they're foreclosing on people and the banksters are like the modern mafia and they're kicking people out of their house, etc. Etc. Etc.

And I take kind of a middle.

Ground on this one, I guess.

And I guess I could best sum.

Up my thoughts on the Occupy Wall.

Street movement by recounting a recent Facebook.

Post that I made on my friend Mike Munzing's post. He posted a really cool graphic that.

Showed the protesters and it said down with the evil corporations.

And it had a whole list, a picture of all the protesters showing all.

Of the things that they're using and.

Carrying and how these things are all made by big corporations. And so it's a cool graphic. I'm sure you may have seen it floating around the Internet. It says camera by son, video camera by Panasonic, cell phone by Samsung, hat by J.

Crew, razors by Gillette, dye by Clairol, bag by Eddie Bauer, shirt by Gap, cameras by Canon, aluminum by Alcoa, another camera by Nikon, poster board by Weyerhaeuser, cardboard box by Kimberly Clark and it said join us as we organize against corporations using social networking by corporations, smartphones by corporations serviced by wireless carriers that are corporations wearing clothing made by corpor, capturing it all with cameras made by corporations and getting their via cars, buses.

Bicycles and shoes all made by corporations.

We deserve more from these greedy corporations.

Join us afterwards at Starbucks, another big.

Corporation and so my comment on this post was this this whole issue really isn't that simple. I assume that most of these protesters are clueless folks who probably need haircuts.

And what I'm referring to there is the self styled 60s revolutionaries. They had their points, but I think some of them were just kind of protesting to protest.

However, so is the conservative media that I mostly agree with.

And I mostly agree with them, by the way, because they want smaller government, less spending, etc.

In saying that Wall street represents capitalism in quotes, nothing could be further from the truth. Wall street banks and mega corporations are mostly anti capitalism in that they are playing in a rigged game with lobbyist government cronyism, insider dealings at every level. They use lawyers, accountants and PR firms.

As well as of course, the corporate.

Media to commit their crimes. There is very little capitalism on Wall Street. If you're looking for capitalism, look at Main street where small business operates under.

Far too much government regulation.

What I mean by that, folks, and you know you probably get this if.

You'Ve been listening to the show for.

A long time, is that the big corporations, they're not playing in the same.

Game that we are.

They are operating in a much clearer playing field. If you listen to my other show.

The Holistic Survival show, you hear me talk about and interview guest experts all.

The time about how large companies they act like they don't want to be regulated, but they really secretly beg the.

Government to come in and regulate them.

Because what that does is it simply excludes competition.

That's what it has the effect of.

It guarantees their monopoly. Remember, you're listening to Flashback Friday. Our new episodes are published every Monday and Wednesday.

Now, they don't have total monopolies, of course I realize this, but they do have semi monopolies and the Occupy Wall street movement.

It's interesting. I'm glad it's happening, frankly.

To draw attention to this, another one of my Facebook friends made an interesting post posting a picture of Occupy Wall street protesters and the crowd versus tea party protesters.

And the caption said 700 arrests for the Occupy Wall street movement at all of the Tea Party rallies. Not one arrest at the Tea Party rallies.

American flags were everywhere at the Occupy Wall street rally or protest. There's not a single American flag, at least in this picture. So it's interesting. Well, we'll see what comes out of this whole Occupy Wall street thing. And now there's an Occupy Phoenix and Occupy LA and Occupy everywhere else. And it's mostly not constructive, but at least it's drawing attention to the cause.

If these folks could get clearer on their message, I think they'd be a lot more successful.

They just aren't very clear on it so far.

And what I'd say is they should say we love capitalism. It just doesn't really exist much on Wall Street. You hear the right wing media and you turn on any of those fol and they say all these people are morons and they say that they don't know what they're talking about. Wall street capitalism is what makes us great. Well, all I'm saying is that capitalism doesn't include lobbyists, huge law firms and huge accounting firms, control of the media, huge PR firms that control the news people see, and that's not capitalism. If you want to see capitalism, you look at Main street, you look at small business.

That is the real American capitalism right there.

Now, I would be kind of remiss.

In mentioning all this about big companies if I didn't mention the unfortunate passing of Steve Jobs.

I am a big Apple fan.

I'm sure a lot of you are because a lot of you are getting our podcast on itunes.

And what a great CEO, what a.

Great inventor, what a great visionary he was. And really kind of the Thomas Edison.

Of the late, well, I guess the 80s.

And then again when he came back to Apple, the 2000s, so the 21st century.

But you know, they're again, another big company, not really using, or I should.

Say abusing the system so far as I know, the way the banksters do and the way the Wall street folks do.

And that's because they don't really make anything. They just engineer things in their favor. And I'd love to see an America.

Where we could have production here, where.

Our biggest export to China wasn't salvage.

Materials and trash, where our biggest export was really products. And we saw American jobs come back.

The other thought on the Occupy Wall street movement is that it's support, far.

As I know, largely by labor unions.

And I Think labor unions are completely anti capitalist in almost every way.

Last year about this time, I was in Washington D.C. and they had a big rally in D.C. i can't remember what it was called, but it was a big like labor rally and it was huge.

And I went to the spot where that rally was held just as it was ending and I took dozens of photographs and picked up dozens of leaflets literally for the Communist Party in America. All of that stuff was just circulated there like crazy. It was all over the ground, just litter everywhere. And so, you know, unions are anti capitalist. I mean, if you think about it, a lot of people talk about the.

Auto companies, the three major auto companies, the American auto companies, and you know.

Why do they all have to buy their labor from the uaw? Isn't that restraint of trade? Why can't they buy their labor from whoever they want?

It's so illogical some of these things in so many ways. It just drives me kind of crazy. So anyway, we'll see how the Occupy Wall street thing goes and go from there.

Let's take a short break here and just give the show a little bit.

Of variety and then I will be.

Back with more commentary and play for you one of the articles from the.

Financial Freedom Report, which I think you'll find very interesting. Just a few minutes long here and then I'll be back with more commentary after this. So this is an article from Financial Freedom Report, my newsletter that is available@jason hartman.com Here we go.

Too Big to Fail How Incompetent Companies and Politicians Are Kept in Power within the lexicon of business terminology, there is a popular phrase entitled too big to fail that is frequently used to describe large industry players that are kept afloat by the government when they are faced with financial ruin. The theory behind these bailout initiatives is that liquidating a major industry player will result in a total market collapse. These claims are very difficult to substantiate since the government frequently uses this rationale to justify its arbitrary actions, but never seems to allow one of these failing ventures to go into liquidation like a normal business. In practice, the too big to fail phenomenon exists to perpetuate vested interest by artificially maintaining the status quo. Unfortunately, this phenomenon also applies to political movements as well. When individuals or movements are viewed as historic or symbolic, there is frequently a sentiment that it is too big to fail and that any level of incompetence or power obsession must be overlooked to avoid failure for the favored parties. What we have seen is that attempts by government to manipulate the market frequently create much larger problems than those that were originally set to be solved. In these situations, there is an endless litany of excuses that serve as the convenient justification for the expansions of government power that are necessary to protect businesses and individuals that are deemed too big to fail by the powers that be. Ultimately, we will find that the price of this massive government power grab is paid by the producers that make the country run. As these initiatives compound on top of one another over time, the ranks of the producers will contract as fewer people find it profitable to engage in business. Similarly, the ranks of the idle masses will rise as the number of people seeking free entitlements expands. It is inevitable that a breaking point will be reached at some time in the future where the burden foisted on the backs of the producers will be too great for them to bear. The optimal situation would be for a political reversal to happen before that point comes so that the wanton damage being inflicted on the country by the power obsession of its leadership is stopped. In the interim, prudent investors should seek to pursue strategies that will allow them to profit from the government irresponsibility so that their wealth will not be totally destroyed before control of the government is returned to more responsible hands.

Just a reminder, you're listening to Flashback Friday. Our new episodes are published every Monday and every Wednesday. We've got our Meet the Masters event coming up, and that's coming up here.

In just a few short days starting.

October 14th, and I'm really looking forward to it.

We've got I know that many of.

You are attending and we look forward.

To seeing you and thank you for.

Your attendance and especially those of you who come back.

To everyone, that's just really awesome. We love to see you every six months.

And one of the presentations at the last Meet the Masters event was entitled six Years, six Million New Renters. And I have talked a lot at.

Our live events and on the show.

Here about Generation Y, Gen Y, the biggest demographic cohort in American history. 80 million people. 80 million. 4 million larger than the other prior biggest cohort, which changed everything, changed the entire economic and social landscape of the.

United States of America.

And that was the baby boomers. And when we're talking about Gen Y, what's interesting I just recently read this is that the census data showed that 14.2% of all young people ages 25 to 34 are still living with their parents, compared to only 11.8% of them.

Before the recession began in 2007.

Now, just think of how significant that is, because what I did Is I went to a website called nationmaster.com that has some really cool age distribution pyramid charts. And it shows kind of the age distribution in those pyramids.

You've probably seen those before.

And what is interesting is I did a little math here and Gen Y in terms of just this segment of Gen Y.

This isn't the entire Gen y, the.

Entire 80 million, but this part of Gen Y, it consists from age 25 to 34, 42 million people. 42 million people. And when you look at the percentage of them, 14.2% of them living at home. Let me pull out my calculator here. 42 million.

Okay, you got to put in a lot of zeros here.

Oh, that's too many. 42 million. And let's take 14.2%. That is 5,964,000 people living with their parents in just that age group. It doesn't count the people under 25.

That are also part of Gen Y.

Or the people coming right up going through college or finishing their high school years right now. Can you imagine the impact of this when all of those people enter the housing market and the rental market as they ultimately will? I mean, folks, this didn't even include the presentation at the last map. This concept wasn't even included in the.

In that presentation I referred to six.

Years, six million new renters. And by the way, that presentation basically showed that for every 1% increase in interest rates, in mortgage rates that will come in the future, it puts another million people into the rental market to rent properties from you. And that presentation also showed that 6 million new renters in the next six years was actually what we thought to be a fairly conservative number that could go as high as 25 million.

So you do the math.

But this is why large institutional investors are buying up apartment buildings like they.

Are going out of style, so to speak.

Because the demographics coming at the rental housing market are nothing short of phenomenal. Now you compare that with a demographic demographics coming at the stock market right now and you see a completely contrary picture. You see, and this is where Harry.

Dent, I think was absolutely right. Some things I definitely do not agree with him on, but he was, he called this perfectly.

And he basically said back in the mid-90s that baby boomers, 76 million Americans would start pulling their money out of the stock market as they aged and they would start using that money to live. Now here's the thing he never addressed.

And nobody, so far as I've heard, except me, has ever thought of this. I don't know why? I've certainly never read it anywhere and I read a lot of stuff.

But it's an interesting question because about 70, I think it's 72% of what Americans buy is represented on the s.

And P500 in those stocks.

So the interesting thing, and this shows.

That if it's true, the stock market.

Is really a bubble because if people start pulling their money out of stocks to spend on products and to live.

They use that money to live and.

70% of their spending is on stocks.

That are represented in the s and P500.

Then it begs the question that I've never heard anybody ask or think of other than yours truly. It is this for a corporation? What is more important? Is it more important for a corporation to have investors, I.e. shareholders, or is it more important for a corporation to have customers? Well, I would certainly think it'd be.

More important for the company to have customers than investors.

I mean investors are only needed to.

Expand a company's customer base and expand their production facilities and grow in that way. Which that's all well and good, but.

I mean the first thing you got to have is demand pulling products through the system, demand from customers. And so if this hypothesis of mine is accurate, then it really shows that the stock market is largely fed on speculation where people are investing because they're.

Thinking other people will invest and rather.

Than the intrinsic value of customers to a business. I don't think I've ever mentioned that.

On the show before, but I've been thinking about it for many years, ever since I really heard about Harry Denton and what he said in terms of the baby boomers pulling money out of the market.

Anyway, we're going to talk about a.

Lot of this interesting stuff at the Meet the Masters event starting on the 14th.

Few more things here.

I've got quite a few random things just to talk to you about, but.

The qwr, the qualified Written Request letter. I noticed that a lot of you have ordered that. Thank you for your business. I hope it has helped you. It has been fascinating to see the responses. I sent these out on a bunch of my loans and just to see what the bank would say. And interestingly enough, a lot of the responses have been where the banks have basically sent me back my loan docs.

I was actually impressed that they had them. So that kind of surprised me.

They've sent back long answers to my.

What is that letter? I think it's 19 pages long and it's available at Jason hartman.com we actually sell it on the website for a.

Pretty nominal price and you can use it for as many lenders as you have. It comes as a PDF file and.

A Word document so you can modify it and of course you need to, you need to put in your own loan number and the property address and your lender's address and then send it off.

But what's interesting is just the varied.

Responses from the lenders.

Some lenders have not responded in time.

They missed the deadline, which makes them subject to sanctions because they did a.

Consent decree with the government where they.

Said they would answer QW qwrs and respond to consumer requests for information and a QWR qualified written request. That's what it is.

And it's just been really fascinating. I haven't taken any substantive action on them, but I did find one of.

My properties to be something very, very interesting which when I have time to.

Kind of address it, there may have.

Been some fraud in that loan.

Not borrower fraud, lender fraud. And I think I've discovered it and.

Well, I'll talk about that on a future show as we see what, what comes of that.

But this qwr, you should definitely send it out. Of course we're not qualified to give legal or tax advice on the show.

I can just tell you that it's.

A letter that I have used and.

I have definitely enjoyed the responses so far. I've been getting big mailers from the banks and seeing what they say about my loans and who actually owns them and all of this different stuff. I mean that letter is so incredibly detailed. It's something quite amazing.

So we'd love to hear from you. By the way, if you've used the QWR and you've wanted to obtain information from your lender, which believe me, before the QWR I tried to obtain information from one lender, a big name lender.

That I won't mention. Oh, bank of America.

And they were totally non responsive, which is just completely unethical on their part.

I don't have really too many good things to say about BofA. I don't, I don't think anybody does.

But the QWR has actually, they've responded to it.

So that's been really nice to finally see them take some action and respond on another issue.

A lot of you have joined members, you've become members@jason hartman.com and we are continually increasing the value of that membership. And one of the things we're going to start doing is giving away the back issues of the Financial Freedom Report to members. So again, we've been publishing that for a few years now and it's $200.

A year, 197 per year.

And many of those articles, you know, in real estate, things don't change really quickly.

It's not like stocks where you got to watch it every day or every minute actually.

And we've been giving away some stuff, but we are going to give away now many of the back issues of the Financial Freedom Report and they're still completely valid today.

These are not things that have changed in any way.

So get your membership@jason hartman.com and you're going to see, you know, free products.

And stuff like this in the future. So be sure to take advantage of that.

Also, take advantage of our exclusive deals. I'm funding more and more deals for.

Our providers, our local market specialists in all of the different markets around the country.

And we have exclusive deals available to our network only.

So be sure to take advantage of those.

Let me take a brief pause.

We'll be back in just a minute.

What's great about the shows you'll find on jasonhartman.com is that if you want to learn about some cool new investor software, there's a show for that. If you want to learn why Rome Fell, Hitler Rose and independent Enron failed, there's a show for that. If you want to know about property evaluation technology on the iPhone, there's a show for that. And if you'd like to know how to make millions with mobile homes, there's even a show for that. Yep, there's a show for just about anything only from jasonhartman.com or type in Jason Hartman in the itunes store.

Also, I thought I'd mention I've mentioned it before, I think on the show that I am planning to do a little indie documentary, a documentary film and the tentative working title is Rigged. And you can go to RiggedMovie.com it's.

Just a little one page brochure website right now.

But I just really, really like to work with people who are listening to the show, following our work. And if you have any services that you can provide to us, if you're a financial writer, producer, anything like that, we constantly need services. Of course we'd rather keep the money within the family and get those services from our own followers who understand our philosophy and who are our customers.

We'd love to circulate some of the.

Company'S money back to them.

So let us know.

You can go to jason hartman.com just.

Fill out the contact us form and we'll be happy to respond and you.

Know, it may not be something we do right away, but we'll have your.

Name and we may do business together in the future. So we can let some of the.

Money you've sent our way and doing.

Business with us and investing and so.

Forth, we can send it back to you.

So there's my kind of help wanted ad.

Another thing I wanted to mention to you is some of our properties, we're starting to get a little more flexible.

On some of our properties with some.

Of our providers, just because we're finding some really good valued inventory. And when we were doing business, oh, a few years back, pretty much all of our business was brand new product. And then as the development stopped, as the recession started, we stopped looking at new product. There were still builders selling it out there, but they just couldn't compete with the resale market. And the resale market that was particularly attractive was that market where people had purchased homes between 2004, 2005, 2006 in that range. And they obviously bought properties they could never afford.

They bought properties that didn't make sense the day they bought them.

They broke the rules of my ten.

Commandments of successful investing.

And so what we did is we started doing a lot of business with, with resale properties, properties that were purchased at foreclosure auctions, HUD and VA repos, government repos, all of these different things. And we started getting a little more flexible in our timeframe and we started looking at. And then, you know, our thing then was like properties that were built after.

2000, so 11 year old properties.

And then we started finding deals that.

Were even better and we started looking.

Back into the 80s and the 90s. And the great thing about real estate.

Is it lasts so long.

And now it's taken a lot to.

Persuade me to do this, frankly.

And I have providers that are calling.

Constantly that want to get into our network, that want to sell properties to.

Our investors because they know the high.

Quality of our investors and our listeners.

People that really get it, people that.

Are sound, people who are making good.

Decisions, that's you, our listeners. For example, I looked about two weeks.

Ago, I was out looking at properties in Phoenix again and I went out.

With this one group that we're not.

Doing business with and we looked at.

A lot of properties and we looked older, we looked at properties that were built back in the 70s and older stuff and you know, if the deal was good enough, if the price was low enough, we would probably have signed them up and you would probably be.

Hearing from that Group now.

But what I want you to realize is that frankly, I've had to come to terms with because I just always liked newer. It was easy. But there is a right price for everything. And if the price is low enough, I tell you, if the house was built in 1960 and the price is low enough, that's fine with me. It's just that you've got to have a low enough price to offset age because of course, when the property gets.

Older, you got to worry more about maintenance issues.

One thing that you don't have to.

Worry about as much in some of the older properties though, is having a lot of rental competition in the area.

The newer the property, the easier it is maintenance wise and the less concern.

You'Re probably going to have there.

But. But when the property is newer, many.

Times you have more competition for renters because a lot of these newer areas, of course have more renter competition.

So there are equalizing factors.

And this is all something to think about and we're just constantly evaluating it and we will let you know going down the list.

The other thing that I wanted to.

Talk to you about, you know what's.

Amazing to me is how people's perceptions of investing in stocks, bonds and mutual funds is that they can just write.

A check and be done with it.

Yet when it comes to real estate.

Estate, they got to be involved.

Well, if you're paying any attention whatsoever.

To your own portfolio, you've got to be involved in your stocks, bonds and mutual funds too.

And I don't mean if you're just a buy and hold investor or if.

You have a financial planner managing your account.

I mean, at any level, whether you're doing it yourself or you're doing it with an advisor, for example, I get these things in the mail constantly.

And it's just unbelievable the number of trees these people kill with all their disclosure statements.

So the other day I got this.

One, it was from Ameritrade. I have some tiny amount of money in that account that my mother gave me for a birthday present years and years and years ago.

And I think at the time it was like a few hundred dollars in.

AT&T stock or something like that. And now it's even much less than that. I can't even remember what's in there.

But anyway, so I get this, this.

Advisor Direct Ameritrade, what is it?

The Advisor Direct Disclosure Statement form, Adv Part two. And I open it up and it is just legalese. I mean, pages and pages and pages of legalese. And I Get to the end of it. And it is 33 pages long now. Do you really think I have time to read this? Do you have time to read this? When you have stock investments, paper investments, do you read all of these statements? Do you do all the votes, the shareholder votes, the proxy votes? This is just ridiculousness. Nobody is doing this. All of these companies are basically sending.

Out all this stuff and it's just.

A big note about how you can't.

Sue them for anything. I don't know, I haven't read it. I don't have time to read it. But there is no such thing as a passive investment, folks.

There are various levels of passivity, but nothing is passive. Last thing I want to talk to you about is Robert Kiyosaki. He published a little report called the New Rules of Money and I thought it was pretty interesting. And what he does is he talks about the old rules and the new rules.

And you know, I think Kiyoshi just, he does a really good job just.

Summing it up and making it simple and his stuff.

It's good, it just crystal clear and that's why I like it.

So he says the old rules.

And I thought I'd kind of review these.

The old rules. Number one, go to school so you.

Can get a safe, secure job. Well, folks, we know that ain't the case anymore. There's no such thing as a safe, secure job.

Rule number two, work hard, climb the ladder and earn more money. And as Kiyosaki points out, rightly so. He says the problem with working hard is that an employee is taxed at the highest rate. Employees, all the tax laws, they're basically written against the employee. Most of us have heard Warren Buffett.

Say, and I talked about this on.

A prior show, that he thought it unfair that he pays a lower percentage.

In taxes than his secretary. Well, on the last show with Chris Mayer, we kind of blew that myth a bit. But conceptually that concept is true because he's got so many deductions and so forth and he only takes a fairly small salary of $100,000, etc. Etc.

But the point is that the active income, the income that you earn actively as an employee on a job is taxed at the highest rate. Yet the income you earn by being an entrepreneur, it can be filtered somewhat through the business. But the income you earn and the wealth that you create as a real estate investor, that is the most favorable.

Asset set in America, tax wise and otherwise as well. Now this is me talking. I'm just reading his rules that's not what he said here. I paraphrased a couple things that he said. So on the old rules, Kiyosaki goes.

On rule number three, save money. And he says, rightly so, savers are losers, especially if you are saving in US dollars. Well, I actually would say that if you're saving in any form of fiat.

Currency currency, you're going to be a loser.

And of course we have noticed at least lately that the precious metals markets are totally manipulated, haven't we? And if you want to learn more.

About that, we've talked about it on past shows.

But go to gata. They basically talk about precious metals manipulation.

And it's definitely happening. And there are a lot of powers that are a lot more powerful than any of us. So I would say that the precious metals are not the answer. They're better than dollars, probably, but they're not the answer overall. They're defensive, not offensive.

Number four, get out of debt.

Okay, well we know this doesn't make sense. Understand good debt and bad debt, of.

Course, but in my term is always inflation induced debt destruction. That is a very, very powerful concept that can help us as investors win the game. Can it? Yes, it can. Inflation induced debt destruction. So we want to have as much debt as possible on hard commodity assets like income property. And we of course do not want.

To car consumer debt.

But as inflation comes, it will wipe out the value of this debt. We outsource the debt to something called a tenant. It's the ultimate inflation arbitrage. 5 In the old rules, invest in a well diversified portfolio of mutual funds through your company's 401k.

So here I'm reading what Kiyosaki says and it's, it's well put.

First of all, Warren Buffett does not diversify. He says diversification.

And by the way, quotes diversification is.

For people who don't know what they are doing.

Unheard of. Quote. Now this is me talking.

I love the way Robert Allen said it.

Years ago he said, put all your.

Eggs in one basket and watch that basket. And of course he believed that basket was income, property income producing real estate.

And then I'll get back to Kiyosaki here.

Second of all, John Bogle, founder of the Vanguard Group and one of the.

Most brilliant minds in investing today, says.

That mutual fund companies have been ripping investors off. He states that investors in mutual funds, funds put up 100% of the capital, absorb 100% of the risk and receive only 20% of the rewards. And I would say if it goes well, the 80% in the investor gains goes to the mutual fund company. On top of that, the Wall Street Journal called the last 10 years the.

Lost decade because there have been no real profits in stocks in the past 10 years.

So now let's switch over to Kiyosaki New rules.

Okay, so we've got five of these.

Number one, keep your daytime job and.

Start a part time business.

Well, we've certainly covered a lot of home based business opportunities in past. Creating wealth shows we haven't concentrated on that as much lately because so many.

Of you are asking for more real estate content.

But I would certainly agree because you need a tax shelter. At least that business can shelter some of your tax liability at the very least. And at the back best, it could produce some good income for you. So keep your daytime job, but start.

A part time business.

Maybe that business for you is being a real estate investor part time. If you're not one already, maybe you can actually get to the IRS distinction of real estate professional and have material participation in your income properties so that you can get some huge tax advantages.

Just phenomenal advantages.

Number two on the new rules, become an entrepreneur. The world's most successful entrepreneurs did not go to school nor did they climb the corporate ladder.

And we were just talking about Steve Jobs, college dropout, just like Bill Gates. So again, it's about what you do.

We no longer live so much in.

The credential society, do we? So I would definitely say that you need to be an entrepreneur ultimately.

Number three, hedge your money. Instead of saving money, keep money liquid in assets that increase in value as the dollar drops in value. So there we go, the ultimate inflation arbitrage, inflation induced debt destruction.

So that is something that is very important.

I always say that real estate is a fantastic investment, but it's a lousy bank. Real estate is the best investment, but it's not a good bank. So don't have a bunch of equity in your real estate if you can at all help it. Now, some of you can't help.

You've got to put cash down because of the loan limits and I've had to do that lately.

But I'm still making my real estate work for me quite well because I'm buying it at such discounted prices. Occasionally I'll flip something here or there, but mostly I like buy and hold.

That is the ultimate real strategy.

And there will be a time when I can refinance those properties. I can sell them to tenants on a lease option.

Our members only call was about that and we're going to be talking about that if they meet the Masters event. And so there are a lot of options there. Okay.

Number four, use debt as leverage. Kiyosaki says, I'm personally in debt, good debt. So use that debt to make you get leveraged.

Everything in life, in financial life is about leverage.

You have got to create leverage. Leverage through technology, leverage through money, leverage through thinking and education, and leverage by doing things that most people are not doing.

That's my own statement. That's not what Kiyosaki says.

And the last rule is know the difference between salespeople and rich people people.

Here I will read Kiyosaki because I like what he said here.

He says one of the reasons so many people are in trouble financially today is because they get their financial advice from salespeople. Today I cringe whenever I hear so called investment gurus who are really salespeople recommending the old rules of money. As Warren Buffett says, Wall street is the only place that people ride to.

In a Rolls Roll Royce to get.

Advice from people who take the subway.

Now I love that. I mean Warren Buffett, the guy has become largely a political shill lately, recommending all kinds of crazy things that he isn't following himself.

And I don't like that.

But you know, he's very quotable there. I mean, think about that.

Wall street is the only place that people ride to in a Rolls Royce to get advice from those who take.

Take the subway, in other words.

Are you listening to someone who's really done it? Are you just listening to some Internet.

Marketing guru who happens to be on.

The real estate kick this week? I've really done it. I've been doing it for years.

I've created real, real wealth from real estate. I've created a lot of it and I absolutely love this business.

So it's the most historically proven asset class. Put all your eggs in one basket.

Watch that basket. Of course I do mean diversify a little bit.

But the main focus should be on income property. Diversify geographically. You already know my ten Commandments. We will look forward to seeing you at the Meet the Masters event and.

Thanks so much for listening.

Now's your opportunity to get the Financial Freedom Report. The Financial Freedom Report provides financial self defense in uncertain times and it's your source for innovative forward thinking investment property strategies and advice. Get your newsletter subscription today you get a digital download and even more. Go to jasonhartman.com to get yours today. 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.