Dr. Jerome Corsi is a Senior Staff Reporter for World Net Daily where he works as an investigative reporter. Jerome is also a New York Times bestseller of the book entitled Unfit for Command. Jason and Jerome have a quick conversation about the national debt and how Obama plans to pay for it by using citizen’s 401k and IRAs. Jason then interviews Phil from Dallas and answers some of his real estate investment questions.

Key Takeaways:

[4:30] What are Jerome’s thoughts on the potential power grab of our 401ks?

[7:00] How would the government be able to take people’s 401ks?

[10:05] How can people protect themselves from this? Be sure to diversify.

[10:45] Jason introduces Phil to the show.

[15:40] Jason shares his personal story on how he got into real estate investing.

[22:30] It’s so easy to start a business these days. Jason recommends two books to read.

[27:10] Spend your money as much as possible on things that create wealth.

[28:40] It takes roughly $20,000 or so to buy your first property.

[33:45] Phil and Jason talk about Bitcoin.

Mentioned In This Episode:

The $100 Startup by Chris Guillebeau

The Lean Startup by Eric Ries

Tweetables:

“Entitlement spending is rapidly growing to over 60% of the budget.”

“Live on 70% of your income, investing 10%, saving 10%, and giving 10% away.”

“Throwing money at problems doesn’t solve them, thinking solves problems.”

Transcript

Jason Hartman:

Hi there, it’s Jason Hartman your host and thank you for joining me for another episode of the Solomon

Success show with Biblical wisdom for business and investing. Let’s go to today’s lesson and then I’ll

come back on and then we’ll have our main portion with our guest relating to that lesson.

Announcer:

The notion of governments extracting resources from the populous has existed as long as there have been government. The history of humanity is largely one of thief and violence. It is only in recent times when the notion of ethnically government has been one that a majority of people believed in. For much of recent history the United States of America has been viewed as the land of opportunity that oppressed people from other countries viewed as the save harbor of their homes and dreams.

However, the government of the United States has run itself on a highly ruinous course. In the past century the pace of government spending has accelerated prodigiously. This has happened in response to economic destruction, wars, and attempts to steer society through spending on social programs.

The problem that this trend created is one where the rate of government spending has grown so fast that it must continually borrow more with each passing year to meet its spending commitments. This creates an even more problematic future since more promises for future spending have been made than can ever possibly paid without extracting exorbitant amounts of capital from the hands of the populous. There’s a growing number of people who believe that the method the government will use to extract this capital is through indirect seizure or people’s retirement accounts.

In his letter to the Ephesians, Saint Paul writes, “Let the thief no longer steal, but rather let me labor doing honest work with his own hands, so that he may have something to share with anyone in need.” Saint Paul is showing us the virtues of honest service. There is not much reason for hope that the government entities and politicians who run them will suddenly become responsible and ethical. What the government shows us is the example of that we should push away from, what we should seek to avoid. We should seek to live an ethical Godly life in all that we do.

Dr. Jerome Corsi is editor of the Red Alert newsletter. He recently authored, What Went Wrong?: The Inside Story of the GOP Debacle of 2012 and How It Can Be Avoided. Corsi discuses how Obama is trying to take control of people’s 401ks to balance the budget. Dr. Jerome Corsi is a senior staff reporter for the World Net Daily where he works as an investigative reporter.

In 2004, Dr. Corsi co-author the number one times New York Times bestseller, Unfit for Command: Swift Boat Veterans Speak Out Against John Kerry. Dr. Corsi is a frequent guest on talk radio shows nationally and has made repeated television appearances on Fox News, MSNBC, CNN news, and Fox Business News.

Jason:

That was today’s lesson. Let’s get to our guest, but before we do that. Please regardless of what platform you’re listening to us on, whether it’ll be iTunes, Stitcher Radio or SoundCloud. Please go

write us a review, we’d really appreciate that and check out the free resources at our website SolomonSuccess.com. Here’s today main segment.

Hey, it’s my pleasure to have Jerome Corsi on with us for just a moment here to talk about a single quick issue and that is Obama’s plan to take away or take control of people’s 401ks. We’ve talked a lot about this on prior shows and Jerry has been one some other shows talking about some other topics of books that he’s written and it’s great to have him on to talk about this. Jerry, welcome, how are you?

Jerome Corsi:

I’m doing great, Jason. Good to be with you again, thank you.

Jason:

It’s good to have you back and I know this is just a quickie decision here, but what are your thoughts on the possible power grab of our 401ks and IRAs and retirement funds in this country?

Jerome:

Well, I just warm people this is a huge pond of money that’s sitting there, typically sitting in banks or investments and the government can see it. Now, the Obama administrations has made various overtures. They’ve held hearings, they’ve had the properly labor look into it, public hearing and they’ve kind of been around the edges of the topic, which is well, maybe we should require portion of these fees to go into a government-created annuity.

In other words, have you return the money to treasure with an IOU to pay you something in the future for that money. The reason that I’m concerned about it is as soon as the government like the United State under the Obama administration, we’ve tripled – well our debt is now at 16, going to 17 trillion from 10 trillion when George W. Bush took over. So, we’re about double some point of another during the Obama administration, it looks like.

The trend continues. Our national debt in, let’s say, eight years. That kind of an alarming increase in national debt usually at some point it’s going to force the government – we can’t just keep re-buying our own debt under these quantitative easing programs of the federal reserve. The federal reserve’s balance sheet won’t absorb this much debt at some point or other.

So, the concern I’ve got is other countries like Argentina have actually gone in and nationalized retirement accounts, one way or another, effectively taken money. Maybe they’ve left IOUs or guarantees, which may or may not gotten fulfilled and it alarmed me to a thing in Cyprus when Cyprus was faced with having to get yet another government bail out organized by the international monetary fund in the EU and basically the national bankers just confiscated a portion of the savings deposit.

Now, this can happen in a Western democracy belonging to the EU, then who is to say anybody’s deposits are really save? And again, it’s not that I’m saying the Obama administration is breathing down your neck and is going to take your 401k tomorrow, I’m just saying it’s something to think about and to watch for it carefully, because the overtures have already been made by the Obama administration and I take the fact that the overtures have been made as a serious event.

Jason:

Do you think that they will orchestrate a false flag event or they’ll just be a market crash? How would they lend into this type of thing? You know, and try to make it pliable in someway?

Jerome:

I’m not sure a false flag would be created or any event that occurs as a negative event could be jumped on by an administration. I mean, you’ve seen the Obama administration do this. We get the new town shootings or any school shooting and immediately the Obama administration pounces on that tragedy to push a gun control agenda.

So, any negative, you know, downgrading of the United States, any kind of a pulling out of the federal reserve in the amount of quantitative easing, the amount of our treasury debt the federal reserve is willing to buy. It could result, for instance, in an increase in interest rates, which would make the cost of financing our debt tremulously more expensive and any of these situations could precipitate the government saying, well, this would take x amount of hundreds, billions, trillion, whatever the government decides it wants, some how or anything a private savings accounts. Maybe issue them all government annuities or government guarantees to take the cash and use the cash to solve the financial crisis at hand.

Jason:

It never will, because..

Jerome:

Well, unfortunately with the Western economies they’re doing is, this is not a recession. This is not a typical Keynesian post-war downturn. My analysis has been from the beginning that we are in a structural, global down turn precipitated by opening up labor markets to under price labor on a basis where it was economically to fire higher priced laborer, the Western economics, which undermines middle income workers and essentially killed the goose who laid the golden egg.

The global economy was being fueled by the middle class man when the work went to India and China, eventually the middle class was going to run out of spending power and that’s the structural – today that stimulates the man with Keynesian deficit spending with the jobs we created created in China and India. This has been the problem and it’s not going to be solved by deficit spending.

The problems with these massive welfare states we’ve built, the portion of the federal debt that’s not – the federal budget is non-discretionary spending. In other words, entitlement spending is rapidly growing to over 60% of the budget and it will not slow down just because the economy slows down. That’s the problem.

Jason;

Very good points and, folks, get control of your retirement plans, at least make them self-directed if at all possible, because I think the government will go for the low hanging fruit. They’ll – the easy money to convert is money in brokerage accounts and savings accounts. That’s the easy grab. The harder grab is self-directed stuff where it could be, it could have some gold, you could have some real estate, some private money lending, you know, how the heck knows, that’ll just be so hard to quantify and so hard to grab, because it’s so fragmented. Any defensive strategy thoughts there?

Jerome:

Well, I think self-directed IRAs are good. Diversification may be into some commodities, certainty diversify the account, so it becomes harder to grab your entire account, IRA or 401k simply because it’s deposited in banks. Deposited in banks or CDs is easy to grab.

Jason:

That’s for sure. So, you just want to make it harder, because the low hanging fruit is what they always go for. Hey, I know you’ve got to go, but thank you for some quick insights on that and I appreciate having you. We’ll have you again on soon, okay?

Jerome:

Okay, Jason. Thank you.

Jason:

Hey, it’s my pleasure to welcome Phil from Dallas to the show. He has a question about entrepreneurship and investments. Phil, how are you?

Phil:

Hey Jason, how are you doing?

Jason:

Good, good. Thanks for calling.

Phil:

Yeah, so my question comes from those of us who are still transitioing and have the desire to move from the “working income trap” as I believe you’ve called it in the past to a more business/passive/investment type of income, whatever you want to call it, and I feel like there’s a gap. There’s a lot of information about what to do once you’ve arrived, when you have a good chunk of change to try and do something with it. There’s all kinds of people who want to tell you want to do and there’s a lot of information about the general mindset. You can listen to a Steve Jobs speech. You can listen to Tony Robbins tape. You can, these general mindsets, but unactionable ideas.

So, to me, I’m interested into getting into the mindset of somebody who went from there to here and where they were in that interim period. How, you know, the sort of where your mindset was, how you started thinking about it, where the drive came from and the steps you took; probably some failures leading to some successes to get to the point where you’re really investing on a broad scale and living off that income as oppose to working for someone else and I think it’s probably relevant to a lot of people in my generation or just at my stage of life who are struggling with that.

Jason:

Right, great question and it’s one that a lot of people have. So, you know, I hate to bring it up almost, but in Robert Kiyosaki’s Cash Flow Game, he does a pretty good metaphor of this. He calls it the rat race and when you escape the rat race, it means that your passive income can pay all of your expenses and most people never get out of the rat races, because they never get to the point where they create passive or investment type of income that can pay all of their expenses.

So, the first thing to do is to not use all your income to live, okay, because you’ll never get ahead if you don’t live below your means. If you make a million dollars a year or ten million a year. If you spend 1.2 million or 12 million, you’re still going in the red and that’s not good. So, you gotta live on about 70% of your income. You gotta figure out a way to do that, because then that other 30% can become invest-able and this is an old concept also from the book The Richest Man in Babylon, which is a very short kind of famous old book and it talks about living on 70%, investing 10%, saving 10% and giving 10% away, so that’s the paradigm from that book.

Phil:

Yeah, it’s funny you mentioned that. I just heard about that book and finished reading it a couple of months ago.

Jason:

Oh, great. Yeah, then you’ve heard it definitely. So, that’s the first thing you’ve got to do. Your income has got to be ahead of your lifestyle, because then you can start to get yourself above water and it doesn’t really take that long in the broad scheme of things. Most people are too impatient, because everybody wants instant gratification, but it’s surprising how fast this can start to work out for you in the course of just a few years, which really isn’t a long time in the broad scheme of things.

So, that’s the first thing and then in terms of, if you have a day job, if you will, a normal day job, starting a side business will really help in not only the way that it might become a successful business and generate other income for you, but it will reduce your tax bill, because a lot of the expenses that you have as an employee in a normal, everyday job, can become deductible as a self-employed person. So, that’s why having a business on the side becomes a great little tool.

Now, of course, I have to give the disclaimer I’m not a tax professional, check with your tax adviser on this in terms of the legalities of it and so forth, but the whole idea being if you have your own business, you pay taxes to some extent on your net income rather than your gross income whereas an employee you’re taxed the highest rate because you pay your taxes, then you pay expenses, then you get what’s left over. Much better to have income, pay expenses, and then pay taxes after the fact.

So, that’s a much better deal and that’s what a business can do for you. So, did you have a question in terms of what kind of business or what types of investments? Give me a little bit more background, if you would.

Phil:

Yeah and first I just want to say that’s great already. I never heard someone specifically say that and for that reason and I think that’s an awesome point. Like, what I was thinking that not everybody is going to have the same road from here to there, so I wasn’t looking for a formula, but I was interested in kind of what you did and if you have anecdotes from other people that did certain things, that works as well, but I’m just looking for, yeah, maybe a little bit more than just the general, but your own experience. What you tried or if you succeeded right away, what that was.

Jason:

Sure, sure. Yeah, well, my experience was just like this. I mean, I’ve talked about it on the show before, but basically I grew up without much in terms of financial resources and didn’t like that very much. When I got to about 9th grade I realized that money is important and it does matter and it’s better to have it than not and so I got my real estate license when I was in college. I was 19 years old and I hung it with Century 21 and I started selling real estate part time and I did pretty well at it. The reason why I got into real estate though was because I wanted to be an investor and I just didn’t know any other way to learn about it investment but to just learn the business from kind of the typical perspective as a realtor.

So, I did that. I started selling real estate and about six months after I started in the business, one of my clients, a guy named Jim, purchased a condo from me in Huntington Beach, California and he came back to me and said, I just don’t like this property very much. I had a bad tenant and I want to get rid of it. Why don’t you list it for me and put it in the MLS and sell it? I thought, well, maybe this is the first opportunity to be my first investment property and it was. I ended up buying it from him and I had a quote/unquote, the world would see it as a bad experience, but it was really actually quite a good experience, because I had a bad tenant.

The tenants didn’t pay their rent. It was my very first property and I had to evict these people and I was managing it myself and I remember going over to knock on the door and it was this young couple and they just gave me excuse after excuse. I remember I took one of my realtor buddies over there and he was like a little tougher with them and excuse after excuse. I had to evict them and they left the place a total mess. They really did leave like a broken down motorcycle in the middle of the living room and I think I actually heard that story from one of those real estate speakers, but it actually happened to me too and the place was full of trash when they moved out.

So, most people would consider that a bad experience, but guess what, it turned into being a pretty good experience, because I put almost nothing down on that property. It was a little easier to structure those deals way back then. Nowadays it’s much hard to do that and then I ended up cleaning up the property and I sold it to another investor and then I bought my second property and by the way, I made a nice profit selling it even though the tenant experience was bad, I had a pretty decent capital gains experience in terms of a profit, like $30,000 and then I bought a condo for myself in Irvine, California and I didn’t really have much money to do it, so I burrowed some money from my grandmother and I bought that property. I paid a $102,000 for it and a year later, I just happened to be lucky and catch luck, I sold it to a guy who would later become a real good buddy of mine, Mike, I sold it to him for a $160,000 and then I paid my grandmother back and because I burrowed the money from her to buy it, I basically put nothing down.

So, my return was infinite on that property basically and that was when I really, really got it about real estate and after that I just started buying up everything I could and I bought several different houses in different areas. All around Southern California, though, and it all well until the market crashed and then I was stuck with one of them for about seven years and it wasn’t so great and that’s when I learned another lesson and the lesson there is part of my 10 commandments of successful investing is number one, Thou Shall Diversify, okay, that’s not the first commandment. It’s just one of the lessons I learned from this experience and number two is one of the also commandments is Thou Shall Not Gamble and what I was really doing with these property is that they very rarely made sense from a cash flow perspective.

In California, you’re pretty much a speculative investor most of the time, almost all the time, actually, and so the properties got to make sense the day you buy it from a cash flow perspective and if it doesn’t, you just don’t buy it, but I did get lucky on some and I made some money being a speculator or a gambler, if you will, but I always say it’s better to be lucky than good and this time around back in the early 2000s, I said to myself, you know, I am not going to go through that disaster again that happened in the 90s. This time I’m going to diversify. I’m going to have properties in multiple geographical locations. So, if one or two of them go bad, the other two or three might be good, hopefully they will be and then I’ll insulate myself from potential downside risk.

Phil:

Okay, so you were there living off less than your income, you were putting some away, you made your first investment, which though you had basically the worst case scenario at the beginning, it panned out in the end, and then so you were working up until, I mean, the beginning, of course, you must have still been working to…

Jason:
Oh, I’m still working. I’ve never stopped working. I love to work.

Phil:

Well, I mean, working for someone else personally, right?

Jason:

Yeah. Well, I mean, I was working as a realtor, so when you’re a realtor are you really working for someone else? No. You’re an independent contractor and you set your own hours, you set your own income, because you can work hard and make a lot of money or you can be lazy and not make any money. So, you know, I was really always self-employed, if you will, even though I didn’t own the company or own the business always, but that’s the deal.

Phil:

Okay, so that pretty much then becomes the path to success. Things keep feeding on each other.

Jason:

Yeah, definitely. It all really was possible because I lived below my income. Now, granted, as a realtor, I had a pretty high income most of the time. I did well at it. I worked very, very hard and I was very successful in real estate. So, again, that’s a business where there’s a good risk reward ratio and if you work hard and you take the risk, you don’t have any security, you can do very well and I did, but not all people have that.

So, that’s why I say if you don’t want to give up the security of a job, if you’re in a position of a job now, start a business on the side and have – be diversified so you’ll have something else going on creating income for you and nowadays it’s so easy to start a business. I mean, you just build a website and the world is your oyster, you know what I mean?

Phil:

Absolutely. That’s a good segue, so on one of your last podcasts you mentioned that people are more entrepreneurial today, in today’s generation. That was your observation and I was going to say that a lot of that is probably due to the internet and I think a lot of it is also due to instability. I mean, 50 years ago, people probably suspected that they could work for a couple or two their whole life and retire with some sort of pension or retirement plan and it’ll be okay and nowadays I don’t think any of us believe that.

Jason:

No, fortunately we’ve all learned that doesn’t work anymore. It is so easy to start a business nowadays and the internet, there’s certainty lots of options there, but there are even offline options that aren’t internet related and there’s a great book title that has very good reviews. I have no read this book, but it, I love the title and it’s called, The $100 Startup: Reinvent the Way You Make a Living Doing What You Love and Create a New Future and it’s by Chris Guillebeau, I guess, I hope I’m pronouncing that correctly. Very good reviews on Amazon.com. I would get that book if I were you.

There’s another book that’s very popular as well, it’s called The Lean Startup: How Today’s Entrepreneurs Used Continuous Innovation to Create Radically Successful Businesses by Eric Ries. Again, you can start a business with very little money nowadays. In the old days, it used to be a lot more expensive. Much bigger barriers to entry than there is nowadays.

Phil:

Absolutely. So, if the question is how are things changing in today’s landscape, would that change the way you think about anything or just, what are the differences in how you think about things in today’s landscape versus previously?

Jason:

Well, let me answer not exactly that question, because there’s one more thing I wanted to say about my real estate career and this is very important. One lesson that I learned from my mother, I used to manage two small businesses that she owned when I was in highschool and college and one of them was a Pioneer Chicken franchise, kind of like Kentucky Fried Chicken, most people have heard of KFC. It was a competitor to KFC and it was in a very bad area of Los Angeles and I remember how big that investment was for her to own that franchise, to buy it. It was a $100,000 cash down, a $100,000 in loans and $75,000 in equipment leases for all the chicken cooking equipment.

So, that was a $275,000 investment and I just marveled that I went to real estate school and it cost me $99 and I was 19 years old and when I got into my real estate office, Century 21 Academy in Anaheim, California. When I started working there, I remember noticing that the people in the office were all sitting around complaining about why the company didn’t do enough for them, why their broker was so bad, and why they didn’t want to spend any money to pay for anything.

They didn’t want to buy promotional materials like realtors that have their picture on a notepad and stuff like that and, you know, you could buy a thousand notepads bad then for like a $180 and I just remember thinking, my gosh. Why are these people complaining? I mean, the average commission back that maybe was $5,000, okay, or $4,000-5,000 and they’re complaining about spending $200 on their business.

They won’t spend any money, no wonder they’re not making any money. No wonder they’re complaining. I thought, I just remembered my mom’s experience with that terrible Pioneer Chicken franchise that she had over a quarter of a million dollars invested in it, she saved and saved for years to do that and you know, people didn’t treat their career with enough respect.

So, even though it is inexpensive to start business nowadays, it still requires reinvesting in the business and so I just wanted to kind of make that distinction between, I guess, it sort of addressed your question between how it was back then and how it is today.

Phil:

I mean, leverage is obviously a big part of your formula then as well as now it would seem and that’s a little bit harder, obviously. Things are tighter in the credit market and much more stringent.

Jason:

In some ways though, that’s a good wholesome discipline, you know, because that really makes you think and innovate more. Just throwing money at problems doesn’t solve them, thinking solves problems better than…

Phil:

Tell that to the government.

Jason:

That’s the government’s problem, they just throw money at things and don’t think, but does that help? Does that make sense? Does it address your question?

Phil:

Yeah, I think it absolutely does and if I can kind of summarize it, I mean, I think a lot of it comes down to the answers that the get rich quick people don’t want to talk about, which is a lot of it comes down to austerity and personal responsibility and living within your means and making the right decisions and then getting out there and experimenting, investing, and learning all things that are hard to a lot of people or the way that they want to think about it.

Jason:

Absolutely and you know, the other thing I’d like to say to Phil about that austerity concept is don’t be too austere. When you have successes, do reward yourself along the way so that you setup in your mind, you kind of trick your mind into thinking hey, if I do this, if I work hard, there’s a reward for it.

So, I don’t believe in like total austerity. I mean, I live a pretty nice life and I do like to spend money. I’m definitely a consumer, okay, but spend your money as much as possible on things that actually create wealth instead of things that give the appearance of wealth and that’s the mistake most people are making.

Moving almost two years ago to Arizona and living near the ASU campus has been really enlightening for me to see how a lot of these college kids think, because most of them are so anxious to just make money so that they can instantly spend money and the problem is that doesn’t create a future. You’ve got to spend money on the things that are an investment grade, the things that create wealth.

Most people just buy themselves a bunch of expenses and obligations and they do that to usually impress other people. They want to buy nice cars that depreciate in value. These things are the wealth destroyers, only things that produce income, that’s impressive, that’s what will create a future for you.

Phil:

That’s a big, that’s the one thing I distilled from the Robert Kiyosaki book, Rich Dad, Poor Dad and that’s the problem I have with some of these books is I could really distill it down to the one most important idea, for me, from that entire book was that, you know, wealth people buy assets and people that are broke buy debts and liabilities.

Jason:

Yeah, they do. They just buy things that cost more money and create more hassle for them when they should buy things that produce and build. Guns and butter theory. That’s really what it’s all about. So, good, one other part to this discussion that you didn’t necessarily ask, but I think you’re thinking of it from our pre-recording conversation here is, what do you do, you know, how much does it take, like, if you want to start as a real estate investor, it’ll generally take about $20,000 or so to get into the game of buying your first property and if you want to get into the lending side of the business and do hard money or private lending, that’ll probably take about $50,000 to $100,000 because you’re the lender, you can’t use leverage, but if you can’t qualify for a mortgage, then you may need to go that route, but the other thing to explore is the concept of partners and like

I’ve talked about on the show, I’m definitely interested in buying more property and partnering with people and being a cash partner where I can put up money on a deal and go in with, I’ve done this with several of our clients. It’s a very good deal as long as neither party lives in the property and it’s an arm’s length transaction for both people. So, consider partners, consider investors like my second property I got my grandmother to basically loan me the down payment and that was a great deal for both of us. She got paid back, I made a bundle of money.

So, that’s what really got me started and I remember thinking when I sold that property, by the way, going back to the guns and butter and liabilities versus assets concept. I used to really, really want to own a boat and now I have owned a boat and now I never want to own a boat again, but I remember thinking at the time, I was in my early 20s and when I sold that property, I remember having that $60,000 bucks in my hand thinking, gosh, I could buy a sailboat and I’m like, no. I didn’t do that. I bought more properties and years later I bought a big yacht and that was a pretty terrible experience ultimately. Two happiest days of the boat owner’s life, when they buy it and when they sell it, so that’s a great example of how things cost a lot more than the initial cost.

Phil:

I think that’s a good pinpoint of divergence point where if you had made that decision at that point, you would probably be on a very different path. I mean, it would have really stunted your ability to go down the path you’ve gone down if you had made a decision like that at the time. Yeah, so a question to, as a follow up to what you’re saying, so you can get your first property, but you still at the cash flow that you gave, you still have to bring a majority of your income even if you get one or even a couple of properties. I mean, what do you think is the number of single-family home types that your network sells? How many do you typically need to replace your income?

Jason:

It all – everybody is different. So, that question can not be answered, but if you look at it like this, if you look at it that each property produces say $250 a month in income, now, of course, it depends on how much you put down, what market it’s in, there are a lot of variables there, but let’s just use that as a round number. $250 in income, which doesn’t seem like much, but it is the return on investment that’s phenomenal, because maybe you only put $20,000 down on that property, okay, I’m just thinking out loud here. I don’t have exact numbers by any means, but four of those is a $1,000 a month, but you get all sorts of tax benefits, especially if you own several properties and you qualify as a real estate professional, okay, which we have talked about on the show before.

So, eight properties, $2,000 a month, you can start to see how this works and then in a couple of years you can have some rent increases and all those $250 a month may turn into $300 a month each. So, four properties is now $1,200 and eight properties is now $2,400 and you can see where, really, I mean, most people want it all today, you know, I get that, it’s that instant gratification mindset that kills most people, but in a matter of a few short years and that time will pass anyway, you might as well make it constructive. You can really get ahead of the game and keep working. Don’t quit your job, because then you’ll have both incomes and you might have a business on the side. You’ll really have multiple streams of income. You have your day job, you have your business, and you have your real estate investment, three forms of good income for you.

Phil:

Absolutely. I want to talk to you about two smaller issues that are kind of current. Do we have a couple of minutes or should we..?

Jason:

Yeah, just quickly. I gotta go do another interview, but just quickly, sure.

Phil:

I know you’re kind of, your thoughts on golds, so I don’t need to get too much into that, but I just thought it might be, you might be interested in to know that I think gold buggery is very much alive and well.

Jason:

Oh, I think so too.

Phil:

Yeah, the recent plunge, some people are claiming it was a premeditated paper sell off or whatever, the physical demand has gone through the roof since that happened, so there’s no end in sight to the gold buggery and the recent drop just made people really hit the mints for everything as far as I can, but it’s just funny to watch all the articles that came out two weeks ago about the gold rush is over and gold is dead and the gold bugs are wrong and then this week everybody is parodying, oh, physical demand is through the roof and the media just feeds on these things and makes it a frenzy.

Jason:

You know, gold bugs are very illogical, okay. Those people. If gold is up, it’s great, buy more. If gold is down, it’s great, buy more. They just make no sense to me. Gold is totally overrated. It’s okay, but it’s overrated, it’s completely overrated.

Phil:

It’s a deviants of strategy, as you say.

Jason:

Absolutely, absolutely.

Phil:

The other thing I want to talk about really quickly is Bitcoin. You know, this is such a new thing, I really just want to say two things, because I know you talked about it briefly in your last show, but there’s really two things that, to me, there’s a lot of misunderstanding and I think a little bit of ignorance about it and the first point I wanted to make was in regards to the people are comparing it to the tulip frenzy and I’m pretty strongly – I mean, there’s lots of things you can saw about Bitcoin about why it may or may not work, but I think the tulip frenzy aspect of it is kind of crazy.

I mean, a tulip is a tulip and it’s a degradable substance and it doesn’t have any intrinsic value, where as with Bitcoin, I think there is value in a sudo-anonymous currency that can be used worldwide with virtually non-existent commissions when you compare it to the current choices, so I have to say that people are thinking about it wrong and saying there’s no inherent value in the idea of a Bitcoin, but there is inherent value in the networking and what you can sort of accomplish with it.

Jason:

Yeah, the problem with the whole Bitcoin craze and, you know, I’ve really studied this whole Bitcoin thing quite a bit and I don’t own any Bitcoin, by the way, I’ll just make that disclosure, but I think that the governments and central banks are just going to shut that down. There are going to say it’s used by terrorists.

It’s the same way they shot the gift cards down, to some extent. They really put a lot of restrictions last year on those gift cards, those Ammax gift cards and visa gift cards that you can buy at the CVS or Rite Aid or Walgreen stores or any store for that matter. They’ve made those things a lot harder to use and Bitcoin is even worse. I have a feeling the regulators are going to come down on Bitcoin. They’re going to find an excuse to do it and they’re going to do it as a coordinated effort with governments around the world and Bitcoin is going to be in the shadows forever.

Phil:

I would agree with that. I think if it ever becomes a real threat to fiat currencies, they’re going to destroy it.

Jason:

And hey, Bitcoin is a fiat currency.

Phil:

That is true. I think there’s one psychological aspect of it that people aren’t really realizing, which is that there’s a limited amount and that’s good, but it’s such a limited amount that as it goes up in value, what you’re really using is such a fraction that I don’t even think that the person of average mathematical ability can really use it as a unit. I played around with it, a couple of Bitcoins and I bought an ebook and it was such a fraction of a Bitcoin to buy it that I had to make the calculations to a dollar to figure out what value I was paying and whether it was worth it.

Jason:

Right and there in lies the problem also with gold, that’s one of the problems with it too, is that gold is too big of a chunk. It can’t be split up in – yeah, it’s too hard to use.

Phil:

Okay, well, I appreciate it. That’s all the topics I had.

Jason:

Alright, Phil. Well, hey, thanks so much for calling, okay?

Phil:

Sure, Jason. Thanks.

Announcer:

This show is produced by the Hartman Media Company, all rights reserved. For distribution or publication rights and media interviews, please visit www.hartmanmedia.com or email [email protected]. 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.

Because you listened to this post you might also try...

Related Posts