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Welcome back, everybody. 
Thanks for joining. 

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We have a lot to go over in this
episode. 

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I'm pretty excited. 
So first of all, this is my 

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portfolio. 
It is not worth five hundred 

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thousand dollars. 
This one is worth eighty eight 

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thousand dollars. 
Now, there's another portfolio 

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we're going to be looking at in 
this episode that is worth half 

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a million dollars. 
It's right here. 

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It has a balance of five 
hundred. 

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Twenty four thousand. 
I have gone over this one once 

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and an episode. 
A couple months ago. 

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I showed this one. 
It's somebody that I know 

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personally they were good enough
to show me this portfolio and 

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how its performed over the past.
Decade. 

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It goes all the way back to 
2006. 

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So we get a chance to take a 
look at this. 

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Now. 
I'll be showing how this 

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performed during this downturn 
and how it's grown over time. 

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It's somebody's 401K. 
So we'll be taking a look at 

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this. 
There's also a lot of things in 

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the news, the jobs report for 
April were down, 20 million 

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jobs, 20 and a half million 
jobs. 

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Unemployment is up to, almost 
15%. 

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That's just the amount of people
that have actively been applying

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for unemployment. 
So, the real unemployment is 

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probably much higher people that
just are unemployed, but not 

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really. 
Into work right now, but out of 

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the people looking to actively 
find a job. 

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It's 15 percent which is pretty 
incredible with all that 

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unemployment. 
We have a lot of borrowing the 

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treasury expects to borrow four 
point five trillion dollars this

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year, four and a half trillion 
dollars. 

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Think about this before the 
pandemic. 

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We were borrowing seven hundred 
billion dollars. 

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That was the deficit. 
Now. 

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It's up to four and a half 
trillion and that's not the end 

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of it. 
We have bills like this where 

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Congress is wanting to pass 
another 750 billion dollars. 

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In stimulus. 
So almost another trillion 

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bucks, this brings in the 
question of how much money can 

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we just give away four and a 
half trillion dollars, five and 

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a half trillion. 
Why not 10 trillion? 

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Why not 20? 
This is a real question that a 

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lot of people have. 
We're giving away, seemingly 

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endless amounts of money. 
The federal government is giving

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stimulus after stimulus passing 
as much money as they can. 

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And we have the FED at the same 
time doing quantitative easing, 

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their balance sheet has 
completely exploded to almost 

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seven trillion dollars. 
There's some people that are 

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notable People that have 
commented on this like Charlie 

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Munger. 
And they talked about this prior

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to this, pandemic going to be 
taking a look at some things 

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that Charlie Munger has said on 
the subject. 

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I think it's very interesting, 
but it paints a pretty Grim 

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picture. 
Now before getting into any of 

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that. 
I want to take a look at my 

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portfolio and do a little bit of
damage assessment. 

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See what has happened with the 
coronavirus with the pandemic 

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and the shutdown and all of that
stuff. 

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See how it's affected my 
portfolio. 

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So, we can view the value over 
time and you can see we He had 

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some trouble right here, my 
portfolio drop down from seventy

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nine thousand dollars to 60 
thousand dollars and then it 

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returned quite a bit and I've 
been adding money as well, but 

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it's regained a lot of it. 
We're mostly flat right now. 

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So I'm down for thousand dollars
in market gains, but the earn 

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dividends is up three thousand 
dollars. 

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It Nets out to negative, twelve 
hundred bucks. 

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So, I've said this over and over
again, for people that are new, 

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you might not believe me, but I 
say all the time, I don't pay 

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attention to much to the market 
gains and Not saying that 

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because it's convenient because 
I'm in the red. 

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If you go back to previous 
videos, I've said it dozens of 

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times when I'm in the green by 
like twelve thousand dollars. 

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I've said the exact same thing. 
That's great. 

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I'm in the green right now by 
twelve thousand dollars, but 

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market gains are volatile. 
They can change any different 

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day. 
So right now, I'm in the red 

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with the market gains, but my 
Dividends are what I focus on. 

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And that's what I want to look 
at with this assessment. 

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Now, before jumping into the 
different sectors, I'll mention 

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that there's a link in the 
description of this video. 

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If you'd like to look at my 
portfolio. 

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Folio, it's the link called my 
main portfolio. 

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So if you click on that, it'll 
allow you to click into any of 

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these sectors and view any of my
companies. 

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So if you're interested in that,
you can look at it. 

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Now. 
I first want to look at some 

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graphs. 
These are way I track the 

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progress of me becoming 
financially independent just 

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like passive income. 
Some people think it's a 

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buzzword financial Independence,
passive income, all that type of

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stuff. 
I don't consider it buzzwords. 

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Having Financial Independence, 
means that you're less dependent

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on your day job. 
That's something that everybody 

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should be striving for. 
I view this graph right here. 

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As kind of a graph to my 
financial Independence, its way 

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to visually look at it and see 
how close I am to that goal. 

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Now, I started off in 2018 
earning nothing and passive 

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income. 
So at that point, I was not 

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financially independent at all. 
I relied 100% on my active 

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income to pay for everything 
since then I have continued to 

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do deposits, reinvest dividends 
and build up my portfolio. 

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When you start off most of the 
building of it is going to be 

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with your deposits. 
There's no easy way around it. 

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Your money is not going to 
compound. 

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And to hundreds of thousands of 
dollars overnight. 

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So most of it is you depositing 
money figuring out your 

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budgeting putting money in every
single week over and over again,

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and the dividend start to roll 
in. 

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They start to become a bigger 
Factor as time goes on, so you 

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can see this play out with my 
portfolio when I started off. 

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I was earning 15 to 20 bucks a 
month. 

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Now, I'm earning three hundred 
fifty, three dollars in one 

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month. 163 last month. 
I earned $229. 

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So it's built up over time. 
In fact, if I go and throw a 

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Line on this. 
This is from Google to like this

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isn't a line that I draw. 
If you can see this, it's this 

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gray trend line going through 
it. 

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Look at the projection. 
If I continue on the same path, 

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I am by the end of 2020. 
I'll be making over three 

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hundred dollars a month in 
dividends. 

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My goal is to be making around 
400 bucks a month. 

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So that's the goal. 
We'll see if I can do it but 

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even earning over $300, a month 
in dividends is pretty cool. 

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That's thousands of dollars a 
year in passive income that I 

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was earning before. 
So I'm at the start of this 

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journey. 
I'm a young guy. 

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III have a long time to be able 
to build up this portfolio, but 

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you can see the progress over 
time. 

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I could focus on this right 
here, the capital gains and get 

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worried about every single daily
change. 

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I just don't think it's that 
helpful or that motivating. 

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This is the type of thing. 
I focus on. 

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Now, the monthly graph, this is 
just one way to visualize it, 

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but there's other ways as well. 
We could go down and look at a 

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quarterly graph. 
I have one here. 

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It's really just the same data. 
The amount of dividends that 

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I've earned instead of on a 
monthly basis on a quarterly 

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basis. 
So it's not so sporadic. 

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I look at Q 1. 
I earned eight dollars and 76 

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cents in dividends over 90 day 
period. 

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Then if we get into a queue for 
2019, I earned $705 in 

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dividends. 
That's quite a bit of money in 

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three months. 
Quarter, one of 2020. 

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It went down a little bit $617. 
But if I compare that to quarter

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one of 2019, it's three times as
much and then 2019 to 2018, not 

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even comparable. 
So you see the growth year over 

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year. 
I'm earning a lot more money in 

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dividends. 
Again. 

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The majority of this is building
up your portfolio through having

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Appling in your budgeting and 
putting some of the money in 

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your portfolio, every single 
week continually doing that over

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and over again. 
You start to build this stream 

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of passive income. 
Another graph that I can look at

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is the total portfolio value. 
This is a pretty basic one. 

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It's literally my portfolio 
value month by month. 

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So it starts off pretty small. 
I put in some money to begin 

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with stuck around 4,000 bucks 
for the first few months. 

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And then I continue to add money
to overtime. 

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I've been depositing about at a 
rate of two thousand a month. 

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Typically on average. 
I have some months where I A lot

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more, some months where I put 
lesson and then during this 

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downturn, I tried to put in as 
much money as I safely, could. 

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So that's where I am right now. 
This whole thing with M1 

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Finance, this portfolio is just 
a vehicle to be able to create 

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that income stream. 
So that's the way that I view 

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it. 
I buy these companies with that 

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in mind that I want companies 
that can continue to pay 

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dividends despite different 
market conditions. 

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Now, what the pandemic this is 
brought some very unique 

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circumstances that has 
challenged my portfolio and 

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pretty unique ways. 
One of them by far is real 

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estate. 
This is Where I've lost the most

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value. 
I had about 30% allocated the 

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real estate, and it really got 
hurt. 

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I mean, having companies have to
literally close their doors and 

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people told not to go outside. 
That's not a good thing for Real

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Estate. 
So you can see the red right 

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here down 42% four thousand 
dollars in the red. 

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This is money weighted return. 
So it's a little bit different 

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but regardless, it's a lot of 
money in the red. 

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Not only am I on the red on most
of these companies, but I was 

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well within the green on every 
one of them. 

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I mean I was up quite a bit. 
Fifty percent on all these 

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companies, everything was going 
good. 

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And then you're told that retail
is pretty much shut down. 

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So let's go ahead and look at 
the damage here, realty income, 

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Corp somehow. 
I'm in the green on this 

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company. 
I was in the green a lot more. 

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I was up like two thousand 
dollars in the green now. 

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I'm in the green by 200 bucks, 
but regardless, this is the best

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of breed. 
It kind of has a cult following 

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because people like this company
so much. 

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It's a very boring real estate 
company. 

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It owns triple net lease 
Standalone buildings. 

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The type that like Walmart rents
from Ins those type of 

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buildings. 
So, it has a pretty simple 

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business model. 
They own about five thousand 

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properties. 
This company has done so good 

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over the past 10 years. 
It has blown away the S&P 500. 

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So the tech-heavy S&P 500 Realty
and come Corp, has crushed it 

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over the past ten and fifteen 
year period. 

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I mean, even with the downturn 
over the past month, it's still 

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in the lead by a long shot. 
So it's done really good so far.

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And I think the future outlook 
of it is good as well. 

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But there's a lot of unknown 
right now. 

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Store Capital runs a very 
similar business model. 

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It has a diversified tenants. 
It collected, less rent in 

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April. 
So it's in a little bit worse of

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a position. 
I could see store Capital, 

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cutting its dividend sometime 
soon, but I plan on holding it, 

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even if it does now. 
LTC properties and well Tower. 

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Again, those are both similar 
companies. 

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They're both senior, Assisted 
Living type of facilities. 

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Nursing facilities. 
The reason that I bought these 

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companies was because first of 
all, I didn't think we're going 

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to have a pandemic with a virus.
That targets elderly people. 

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So that wasn't part of my 
thesis. 

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When I bought these companies, I
bought it because the group of 

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people that are going to be 
living in nursing facilities is 

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supposed to increase drastically
over the upcoming years. 

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We have a whole generation of 
Baby Boomers and all the 

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surrounding gears. 
We're over the next 10, to 20 

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years. 
There's going to be more people 

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that need a live in nursing 
facilities. 

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So that's the thesis that I 
bought it and That Remains the 

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Same even with this pandemic, 
even with the added cost of them

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fighting the coronavirus and all
their tenants struggling to do 

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00:09:59,100 --> 00:10:01,300
that. 
Don't think there's more moving 

231
00:10:01,300 --> 00:10:03,100
towards our advantage. 
They have a lot of tail winds. 

232
00:10:03,100 --> 00:10:05,300
They have more people going to 
be moving into these homes 

233
00:10:05,500 --> 00:10:07,600
occupancy. 
Rates are expected to go up as 

234
00:10:07,600 --> 00:10:09,700
people age. 
So, I plan on holding both these

235
00:10:09,700 --> 00:10:12,800
companies regardless of the 
short-term troubles. 

236
00:10:12,800 --> 00:10:15,000
They face. 
Now, the next one is a tough one

237
00:10:15,000 --> 00:10:17,800
Simon Property. 
This is the mall company. 

238
00:10:17,800 --> 00:10:20,900
They own hundreds of miles. 
This is one where there was a 

239
00:10:20,908 --> 00:10:25,100
lot of risk, you're taking a bet
on this one before coronavirus 

240
00:10:25,100 --> 00:10:27,800
if you can believe that. 
So there was a whole debate of 

241
00:10:27,800 --> 00:10:29,600
whether malls are going to be a 
relevant thing in the future. 

242
00:10:29,800 --> 00:10:32,900
ER anyway, that was something 
that you were kind of gambling 

243
00:10:32,900 --> 00:10:35,900
on my thought process was. 
I do think they're going to be a

244
00:10:35,900 --> 00:10:37,700
thing of the future. 
I think they need to adapt and 

245
00:10:37,700 --> 00:10:40,800
be more of like a lifestyle 
experience place where there's 

246
00:10:40,800 --> 00:10:44,200
lots of restaurants and events 
and a few High scale shopping 

247
00:10:44,200 --> 00:10:47,400
places, but even then we have a 
lot of risk there and then the 

248
00:10:47,400 --> 00:10:50,800
pandemic came along and it puts 
into question going out and 

249
00:10:50,800 --> 00:10:53,800
shopping in places like malls to
begin with in the future. 

250
00:10:53,800 --> 00:10:57,400
So this is caused a tremendous 
amount of uncertainty investors.

251
00:10:57,400 --> 00:11:00,500
Do not like uncertainty. 
I'm down, 60 Hundred dollars in 

252
00:11:00,500 --> 00:11:03,000
this one. 
Holding down quite a bit on this

253
00:11:03,000 --> 00:11:05,000
one. 
So this one is really hurt the 

254
00:11:05,000 --> 00:11:07,500
gains of the portfolio. 
I'm down quite a bit. 

255
00:11:07,600 --> 00:11:09,400
I will continue to hold this 
company. 

256
00:11:09,500 --> 00:11:12,100
I just think that they're the 
best chance with malls. 

257
00:11:12,300 --> 00:11:14,900
Simon Property owns the highest 
quality places. 

258
00:11:15,000 --> 00:11:18,400
These aren't cheap strip malls 
and random corners of bad parts 

259
00:11:18,400 --> 00:11:21,000
of town. 
These are the high quality City 

260
00:11:21,000 --> 00:11:24,400
plazas in the middle of Highly 
dense high-income areas. 

261
00:11:24,400 --> 00:11:27,400
So if there's a chance that 
malls are going to be successful

262
00:11:27,600 --> 00:11:29,600
and they're going to be a thing 
of the future Simon. 

263
00:11:29,700 --> 00:11:33,200
Property is the group to bet on.
They also bought Kalman, which 

264
00:11:33,200 --> 00:11:36,000
is a another smaller Mall read 
that has really high quality 

265
00:11:36,000 --> 00:11:38,100
places. 
So I just think they're the best

266
00:11:38,100 --> 00:11:40,100
bet with malls. 
They have a good balance sheet. 

267
00:11:40,100 --> 00:11:42,300
They can make it through a long 
time period. 

268
00:11:42,300 --> 00:11:44,200
So this is a company that has 
been irresponsible. 

269
00:11:44,200 --> 00:11:46,600
They have a lot of cash on 
balance. 

270
00:11:46,600 --> 00:11:49,500
They can float for a long time 
until things recover. 

271
00:11:49,500 --> 00:11:51,800
So I'm going to continue to hold
this company. 

272
00:11:51,800 --> 00:11:53,800
I think there's a lot of 
potential upside with them. 

273
00:11:53,800 --> 00:11:57,400
A lot of this is dependent on 
how quickly things return to 

274
00:11:57,408 --> 00:12:00,800
normal and they're not being a 
new Colonel where people only 

275
00:12:00,800 --> 00:12:02,800
shop online. 
If we have a new normal where 

276
00:12:02,800 --> 00:12:04,700
people don't go outside. 
They don't go to malls. 

277
00:12:05,100 --> 00:12:08,400
They don't shop that way. 
Then this is going to be a Bad 

278
00:12:08,400 --> 00:12:10,100
Bet. 
So that's obviously something I 

279
00:12:10,100 --> 00:12:12,400
don't think is going to happen. 
I think malls, will still be a 

280
00:12:12,400 --> 00:12:14,500
thing in the future. 
Now, there's a couple other 

281
00:12:14,500 --> 00:12:17,000
sectors that have been pretty 
beat up during the downturn. 

282
00:12:17,300 --> 00:12:19,900
We got Finance, industrial, and 
energy. 

283
00:12:19,900 --> 00:12:23,100
So, first, look on to finance, 
this is another one that I had a

284
00:12:23,100 --> 00:12:25,300
lot of money and I'm down 1500 
bucks right now. 

285
00:12:25,900 --> 00:12:28,500
I think it will recover. 
None of these companies have cut

286
00:12:28,500 --> 00:12:31,000
their dividend, all of them. 
I think are doing pretty well. 

287
00:12:31,000 --> 00:12:33,200
They're doing okay. 
The reason that people sell out 

288
00:12:33,200 --> 00:12:37,000
of banks during recessions is 
because Banks make money lending

289
00:12:37,000 --> 00:12:39,500
out money to businesses and 
during a recession. 

290
00:12:39,500 --> 00:12:41,700
It's more likely those 
businesses can't pay them back. 

291
00:12:41,700 --> 00:12:44,400
So that's the main factor there.
People don't like owning Banks 

292
00:12:44,400 --> 00:12:47,000
during recessions. 
Another reason that they go down

293
00:12:47,000 --> 00:12:48,900
in value is because they're less
profitable. 

294
00:12:49,100 --> 00:12:51,000
They make money with higher 
interest rates. 

295
00:12:51,200 --> 00:12:53,800
Interest rates are at zero and 
it's likely to remain that way 

296
00:12:53,800 --> 00:12:55,300
for a while. 
So those are the main reasons 

297
00:12:55,300 --> 00:12:57,300
again, none of these companies 
have cut their dividend. 

298
00:12:57,300 --> 00:13:00,100
So they're all paying the one 
that is probably most It has 

299
00:13:00,100 --> 00:13:02,500
some kind of dividend reduction 
is main. 

300
00:13:02,700 --> 00:13:04,100
This is the highest yielding 
one. 

301
00:13:04,300 --> 00:13:07,400
They take on the riskiest loans 
of companies that normal Banks. 

302
00:13:07,400 --> 00:13:09,800
Don't lend to this company has 
the highest risk. 

303
00:13:09,800 --> 00:13:12,100
It hasn't cut its dividend yet 
and it's one that I intend to 

304
00:13:12,100 --> 00:13:13,800
hold so we'll see what happens 
with that one. 

305
00:13:14,000 --> 00:13:17,300
Then we have the energy sector. 
This has been an area that I've 

306
00:13:17,300 --> 00:13:20,300
mostly lost money in ever since 
starting to invest in it. 

307
00:13:20,700 --> 00:13:23,600
If I go and it's only 1% of my 
portfolio. 

308
00:13:23,700 --> 00:13:27,800
This is not a lot there but I'm 
down nearly 40% 500 bucks. 

309
00:13:28,100 --> 00:13:31,000
So let's go take a look at this.
I used to own a bunch of smaller

310
00:13:31,000 --> 00:13:34,100
oil companies, but months ago. 
I sold out of them into these 

311
00:13:34,100 --> 00:13:37,500
two really big oil companies 
Chevron and ExxonMobil. 

312
00:13:38,100 --> 00:13:40,400
The reason that I selected them 
is because they're really big. 

313
00:13:40,500 --> 00:13:43,200
That's the reason why the Saudis
and the Russians have been 

314
00:13:43,200 --> 00:13:45,800
producing a lot of oil. 
That's driven down the price of 

315
00:13:45,800 --> 00:13:48,500
it, because we have 
overproduction of oil at a time 

316
00:13:48,500 --> 00:13:51,500
that we have under-consumption. 
So we have too much oil. 

317
00:13:51,500 --> 00:13:54,700
The prices have dropped down and
all the smaller oil companies 

318
00:13:54,700 --> 00:13:57,200
are really struggling right now.
So I plan on holding these two 

319
00:13:57,200 --> 00:14:00,500
companies will see if they cut 
their Didn't right now they 

320
00:14:00,500 --> 00:14:03,300
haven't. 
It depends on how low oil prices

321
00:14:03,300 --> 00:14:05,100
stay for. 
How long but I have these two 

322
00:14:05,100 --> 00:14:08,000
companies not too much invested 
in them thousand bucks right 

323
00:14:08,000 --> 00:14:09,500
now, but I continue to hold 
them. 

324
00:14:09,800 --> 00:14:11,700
So that's it. 
That's the damage so far. 

325
00:14:12,100 --> 00:14:15,500
I'll keep you updated on it as 
companies continue to try to 

326
00:14:15,500 --> 00:14:18,300
make their way through this 
recession, whatever you want to 

327
00:14:18,300 --> 00:14:20,900
call it through this really 
unique downturn. 

328
00:14:20,900 --> 00:14:22,800
We'll see what happens. 
Now, moving on. 

329
00:14:22,800 --> 00:14:24,900
Let's take a look at a much 
bigger portfolio. 

330
00:14:25,500 --> 00:14:28,100
This is a five hundred thousand 
dollar portfolio. 

331
00:14:28,100 --> 00:14:29,400
Let me go to the ending balance 
there. 

332
00:14:29,700 --> 00:14:31,200
Right there. 
Five hundred and twenty four 

333
00:14:31,200 --> 00:14:33,000
thousand dollars is a current 
balance of it. 

334
00:14:33,300 --> 00:14:35,100
I've shared this portfolio 
before. 

335
00:14:35,100 --> 00:14:38,200
This is somebody's that they I 
know them personally and they've

336
00:14:38,200 --> 00:14:39,900
been good enough to allow me to 
share this with you. 

337
00:14:40,100 --> 00:14:43,000
So this is a 401k, you can see 
that the employer contributes as

338
00:14:43,000 --> 00:14:45,500
well as the employee. 
This is why you should max out 

339
00:14:45,500 --> 00:14:47,800
your 401 K's if your employer 
saying that they're going to 

340
00:14:47,800 --> 00:14:49,900
give you a match, you should 
always try to Max that out 

341
00:14:49,900 --> 00:14:52,900
before putting your money into 
other things, but regardless you

342
00:14:52,900 --> 00:14:55,800
can see how this has grown over 
time back in 2007, before the 

343
00:14:55,808 --> 00:14:58,200
financial crisis. 
He had a hundred and thirty four

344
00:14:58,200 --> 00:14:59,600
thousand dollars in this 
portfolio. 

345
00:15:00,300 --> 00:15:04,200
Then it had a severe downturn 
dropped a 92,000 and it 

346
00:15:04,200 --> 00:15:05,900
continued to go back up a little
bit. 

347
00:15:05,900 --> 00:15:09,600
And then, it dropped down, more 
and more all the way to 77 

348
00:15:09,600 --> 00:15:12,900
thousand dollars. 
So he nearly cut in half his 

349
00:15:12,900 --> 00:15:16,200
portfolio. 134,000, two years 
later. 

350
00:15:16,700 --> 00:15:19,500
That's a long time. 
Put yourself in that situation, 

351
00:15:19,900 --> 00:15:23,300
two years of seeing your money. 
Go down over and over again 

352
00:15:23,500 --> 00:15:27,400
while you're contributing to it.
So his portfolio got cut in half

353
00:15:27,600 --> 00:15:29,600
and he's probably doing 
contributions all throughout. 

354
00:15:29,700 --> 00:15:31,700
This time now, keep in mind that
right hair. 

355
00:15:31,800 --> 00:15:33,900
When it's portfolio, value was 
73,000. 

356
00:15:34,300 --> 00:15:38,200
It's been wiped out by half. 
It used to be 134,000 but two 

357
00:15:38,200 --> 00:15:40,900
years later. 
It's half as much money 73 

358
00:15:40,900 --> 00:15:43,800
thousand bucks. 
This was February of 2009. 

359
00:15:44,000 --> 00:15:47,100
This was the very bottom of the 
market, right here. 

360
00:15:47,100 --> 00:15:50,600
Was the very bottom this wasn't 
some magical time when everybody

361
00:15:50,600 --> 00:15:53,300
got together and the News was 
very positive and people said, 

362
00:15:53,300 --> 00:15:56,100
hey guys, this is the bottom of 
the recession is over. 

363
00:15:56,400 --> 00:15:58,900
Things are going to go up now. 
Things are looking up. 

364
00:15:59,200 --> 00:16:01,200
That is not Happened. 
These news stories, still 

365
00:16:01,200 --> 00:16:02,300
exists. 
You can go look at them. 

366
00:16:02,600 --> 00:16:06,700
It was unbelievably - when the 
market decided to turn around 

367
00:16:06,800 --> 00:16:09,700
and February of 2009. 
The news was largely 

368
00:16:09,700 --> 00:16:13,400
overwhelmingly negative. 
So this is something that in 

369
00:16:13,400 --> 00:16:15,300
hindsight. 
It looks like, oh, I could just 

370
00:16:15,300 --> 00:16:17,000
invest, that would be the best 
time to buy. 

371
00:16:17,500 --> 00:16:19,100
Think about what you've gone 
through though. 

372
00:16:19,100 --> 00:16:20,700
It'd be very difficult to do 
that. 

373
00:16:20,800 --> 00:16:23,300
The news was overwhelmingly 
negative and you had to stay 

374
00:16:23,300 --> 00:16:26,100
invested during that time not 
knowing that this was the bottom

375
00:16:26,100 --> 00:16:27,800
of the market, but that's what 
he did. 

376
00:16:27,800 --> 00:16:30,900
He continue to invest and you 
can See the results of that five

377
00:16:30,900 --> 00:16:32,800
hundred and seventy seven 
thousand dollars. 

378
00:16:33,100 --> 00:16:35,800
This is the highest point that 
this portfolio hit. 

379
00:16:36,000 --> 00:16:38,600
Let's take a look at how much 
money he lost in like two 

380
00:16:38,600 --> 00:16:41,200
months. 
It goes down to four hundred and

381
00:16:41,200 --> 00:16:45,500
seventy thousand dollars. 
So from 577 2470, he lost a 

382
00:16:45,500 --> 00:16:48,000
hundred and seven thousand 
dollars in the course of two 

383
00:16:48,000 --> 00:16:50,800
months, 107 thousand dollars. 
That's a lot of money, 

384
00:16:51,000 --> 00:16:53,400
especially if your portfolio is 
just over half a million. 

385
00:16:53,400 --> 00:16:56,000
So that's a pretty big drop. 
But then of course it's 

386
00:16:56,000 --> 00:16:59,500
recovered quite a bit. 
It went from 472 524. 

387
00:16:59,700 --> 00:17:01,700
So he's down maybe fifty 
thousand dollars from his 

388
00:17:01,700 --> 00:17:03,300
all-time high. 
So, you know, I look at my 

389
00:17:03,300 --> 00:17:07,200
portfolio and I lost a couple 
thousand bucks here mind of down

390
00:17:07,200 --> 00:17:11,200
I think into the red by - 15,000
I compared to portfolios like 

391
00:17:11,200 --> 00:17:13,400
this a hundred and seven 
thousand dollars lost in the 

392
00:17:13,408 --> 00:17:16,400
course of two months and you put
it all in context. 

393
00:17:16,400 --> 00:17:19,400
If you're worried about losing 
the couple thousand dollars 

394
00:17:19,700 --> 00:17:22,200
because the market went down a 
little bit, realize that there's

395
00:17:22,200 --> 00:17:24,200
people that have hundreds of 
thousands of dollars. 

396
00:17:24,200 --> 00:17:26,599
They have a lot of money in 
their portfolios. 

397
00:17:26,800 --> 00:17:29,500
There's have gone down a lot 
more, you know, the same. 

398
00:17:29,600 --> 00:17:31,800
Um, so don't stress about it too
much. 

399
00:17:31,900 --> 00:17:34,100
Look at it through the context 
of the long-term view. 

400
00:17:34,600 --> 00:17:36,800
He looks at this and he says, 
well I'm going to be working for

401
00:17:36,800 --> 00:17:39,600
at least the next 10 years. 
So I'm going to continue doing 

402
00:17:39,600 --> 00:17:42,500
exactly what I've been doing. 
Just continue to invest, have 

403
00:17:42,500 --> 00:17:45,500
your employer contribute, if 
you're in a 401 k, so if you're 

404
00:17:45,500 --> 00:17:48,400
looking at it through that lens,
through the long-term view, you 

405
00:17:48,400 --> 00:17:50,700
can see what happens. 
But when you're in these type of

406
00:17:50,700 --> 00:17:53,500
areas, 2009, lot of people sold 
out. 

407
00:17:53,500 --> 00:17:55,700
That's why the market went down.
This is something where I think 

408
00:17:55,700 --> 00:17:58,000
it's really difficult when 
you're in these times, but 

409
00:17:58,000 --> 00:18:00,800
eventually will come out on top.
My feeling with it and I feel 

410
00:18:00,800 --> 00:18:02,100
the same way with the 
coronavirus. 

411
00:18:02,100 --> 00:18:04,800
There's a lot of things going 
on, a lot of scary news, but 

412
00:18:04,800 --> 00:18:06,000
eventually we'll move on from 
it. 

413
00:18:06,300 --> 00:18:10,000
Now, speaking of a scary news. 
This is something that I think 

414
00:18:10,000 --> 00:18:12,600
is actually scary news. 
So a lot of things in politics, 

415
00:18:12,600 --> 00:18:15,200
I don't really concern myself 
with too much. 

416
00:18:15,200 --> 00:18:16,900
A lot of the social issues 
people. 

417
00:18:16,900 --> 00:18:18,300
Argue about things, back and 
forth. 

418
00:18:18,300 --> 00:18:19,700
Everybody has their different 
sides. 

419
00:18:19,800 --> 00:18:23,400
I think we're always going to 
have that different opinions on 

420
00:18:23,400 --> 00:18:25,500
things. 
But one thing I think should be 

421
00:18:25,500 --> 00:18:29,200
scary to everyone, everybody 
should be concerned about it is 

422
00:18:29,600 --> 00:18:31,600
Massive amounts of debt that a 
country can get in. 

423
00:18:31,900 --> 00:18:34,700
We have the US Treasury, this is
from The Wall Street Journal. 

424
00:18:34,800 --> 00:18:37,300
The US Treasury expects to 
borrow four and a half trillion 

425
00:18:37,300 --> 00:18:40,700
dollars this year. 
And this is from spending in a 

426
00:18:40,700 --> 00:18:44,700
couple months, like two months 
were borrowing four and a half 

427
00:18:44,700 --> 00:18:47,500
trillion dollars. 
This is astronomical. 

428
00:18:47,700 --> 00:18:50,500
If you look at our total debt, 
the amount of debt that the u.s.

429
00:18:50,500 --> 00:18:53,300
Government has it's like twenty 
five trillion dollars. 

430
00:18:53,700 --> 00:18:56,900
So we added on a big chunk of 
that in a couple months. 

431
00:18:56,900 --> 00:18:58,700
All this money comes from 
somewhere. 

432
00:18:58,800 --> 00:19:02,100
The government has to Raise this
money, by raising more debt that

433
00:19:02,100 --> 00:19:03,700
debt goes on to our federal 
budget. 

434
00:19:04,000 --> 00:19:06,100
And we have to pay for that 
interest every single year. 

435
00:19:06,100 --> 00:19:09,800
So the interest makes up a 
growing portion of the pie of 

436
00:19:09,800 --> 00:19:12,800
our income out of our whole 
budget and makes up like seven 

437
00:19:12,800 --> 00:19:15,900
percent plus. 
So that will continue to grow. 

438
00:19:16,200 --> 00:19:18,800
We'll be paying more and more in
interest every single year just 

439
00:19:18,800 --> 00:19:21,000
to maintain the debt. 
Not even to pay it down. 

440
00:19:21,200 --> 00:19:24,200
On top of that. 
We have more to come another 750

441
00:19:24,200 --> 00:19:27,800
billion dollars in Aid to State 
and local governments to help 

442
00:19:27,800 --> 00:19:31,300
them pay for unemployment. 
So, So this again, is an 

443
00:19:31,300 --> 00:19:34,700
enormous amount of money 750 
billion just to put that in 

444
00:19:34,708 --> 00:19:37,800
reference just this additional 
stimulus going to State and 

445
00:19:37,800 --> 00:19:42,100
local governments. 750 billion 
is worth more than every company

446
00:19:42,100 --> 00:19:44,700
in the u.s. 
Aside for four companies. 

447
00:19:44,900 --> 00:19:48,100
There's four that have a market 
cap bigger than this amount, and

448
00:19:48,100 --> 00:19:51,600
it's Apple, Amazon, Google, and 
Microsoft. 

449
00:19:51,700 --> 00:19:53,000
This is worth more than 
Facebook. 

450
00:19:53,000 --> 00:19:56,500
So, this amount of money is 
astronomical the government's 

451
00:19:56,500 --> 00:19:58,500
giving it away. 
We're paying for unemployment 

452
00:19:58,900 --> 00:20:00,300
all this time. 
Stimulus. 

453
00:20:00,500 --> 00:20:03,300
It's helping get the economy by,
but it also causes a lot of 

454
00:20:03,300 --> 00:20:05,100
problems. 
Anytime, the government gives 

455
00:20:05,100 --> 00:20:06,700
away trillions of dollars like 
this. 

456
00:20:06,700 --> 00:20:09,200
There's going to be a lot of 
winners and losers, everybody 

457
00:20:09,200 --> 00:20:12,500
knows about groups and entities 
that have received money. 

458
00:20:12,900 --> 00:20:16,200
That really have no business 
needing or receiving money. 

459
00:20:16,300 --> 00:20:18,700
There's lots of colleges that 
have billions of dollars in 

460
00:20:18,700 --> 00:20:21,200
Investments That received 
millions of dollars in 

461
00:20:21,200 --> 00:20:24,100
government Aid and they receive 
that money while they're paying 

462
00:20:24,100 --> 00:20:26,500
their president, millions of 
dollars to run the college. 

463
00:20:26,600 --> 00:20:29,400
So, their situations like that. 
There's lots of big businesses. 

464
00:20:29,600 --> 00:20:32,400
Like Delta Airlines and others 
that have received, billions of 

465
00:20:32,408 --> 00:20:35,100
dollars that they've done stock 
BuyBacks over the past years. 

466
00:20:35,200 --> 00:20:37,300
There's individuals that have 
received money that probably 

467
00:20:37,300 --> 00:20:38,700
don't need it. 
There's people that haven't 

468
00:20:38,700 --> 00:20:41,400
received money that do need it. 
This is the type of thing that 

469
00:20:41,400 --> 00:20:42,800
happens. 
When you give away this amount 

470
00:20:42,800 --> 00:20:45,800
of money, the government cannot 
be expected to give away 

471
00:20:45,800 --> 00:20:48,700
trillions of dollars and have it
be done in a way that is 

472
00:20:48,800 --> 00:20:51,700
Equitable to everybody. 
That's fair and even everybody, 

473
00:20:51,700 --> 00:20:54,400
it's never going to happen. 
So this creates a lot of winners

474
00:20:54,400 --> 00:20:56,500
and losers. 
Now, another issue that this 

475
00:20:56,500 --> 00:20:59,500
stimulus has caused is what's 
called perverse. 

476
00:20:59,600 --> 00:21:04,000
Tips, pretty much in economics. 
It's the study of incentive. 

477
00:21:04,200 --> 00:21:06,000
That's really all you're 
studying with economics. 

478
00:21:06,100 --> 00:21:08,700
People make decisions based off 
of incentives. 

479
00:21:08,700 --> 00:21:10,500
The reason they go to work is a 
want to earn money. 

480
00:21:10,700 --> 00:21:12,500
The reason that they spend money
is because they want to have 

481
00:21:12,500 --> 00:21:15,500
things and enjoy them. 
Everybody runs on incentives. 

482
00:21:15,500 --> 00:21:19,000
It's normal, human behavior. 
Anytime that you do something 

483
00:21:19,000 --> 00:21:21,200
like this, where you give away 
trillions of dollars. 

484
00:21:21,200 --> 00:21:23,900
You give away money, you pay 
people to stay home that creates

485
00:21:23,900 --> 00:21:25,900
what's called perverse 
incentives, normal. 

486
00:21:25,900 --> 00:21:28,300
You want to try to avoid doing 
that as much as possible. 

487
00:21:28,600 --> 00:21:29,800
If we look at this article. 
Kle. 

488
00:21:29,800 --> 00:21:31,300
It highlights. 
What's going on here? 

489
00:21:31,300 --> 00:21:33,700
It says, business is looking for
a quick return. 

490
00:21:33,700 --> 00:21:36,000
To normal are running into a big
hitch. 

491
00:21:36,000 --> 00:21:38,800
Workers on unemployment benefits
are reluctant to give them up. 

492
00:21:39,000 --> 00:21:41,200
That's complicating, plans to 
reopen States. 

493
00:21:41,200 --> 00:21:42,400
As the u.s. 
Gets the economy. 

494
00:21:42,400 --> 00:21:44,400
Back on track. 
I Lana who was laid off from her

495
00:21:44,408 --> 00:21:47,800
job as a bartender. 
At New York said she hopes her 

496
00:21:47,800 --> 00:21:50,700
boss doesn't call her back soon.
Let me read that again. 

497
00:21:51,000 --> 00:21:54,300
She hopes her boss, doesn't call
her back soon. 

498
00:21:54,400 --> 00:21:57,100
I was crying at work to leave 
but then as time went on, I did 

499
00:21:57,100 --> 00:21:59,200
receive benefits. 
It was like, wow. 

500
00:21:59,600 --> 00:22:01,800
Getting more than I was when I 
worked there. 

501
00:22:02,300 --> 00:22:06,100
She's getting paid more than she
was at her bartender job in this

502
00:22:06,100 --> 00:22:09,500
airport in New York city. 
So she doesn't want her boss to 

503
00:22:09,500 --> 00:22:11,100
call her. 
She's getting paid more to stay 

504
00:22:11,100 --> 00:22:13,600
home right now. 
We continue on with this 

505
00:22:13,800 --> 00:22:17,100
Congress passed a coronavirus 
stimulus package in March that 

506
00:22:17,100 --> 00:22:19,500
boosted unemployment benefits by
six hundred a week. 

507
00:22:19,900 --> 00:22:23,500
So Most states already pay you 
unemployment coverage. 

508
00:22:23,500 --> 00:22:25,400
They pay out about 400 bucks a 
week. 

509
00:22:25,400 --> 00:22:27,900
It's not a whole lot. 
But then the federal government 

510
00:22:27,900 --> 00:22:31,400
a this up by adding an channel, 
six hundred dollars a week that 

511
00:22:31,400 --> 00:22:33,200
leads to about 1,000 bucks a 
week. 

512
00:22:33,400 --> 00:22:35,500
That's a lot of money for 
thousand dollars. 

513
00:22:35,500 --> 00:22:37,900
A month is a lot of money for 
most people. 

514
00:22:38,200 --> 00:22:40,700
Now, we look at this about half 
of us. 

515
00:22:40,700 --> 00:22:44,900
Workers stand earn more if laid 
off than they did at the job. 

516
00:22:44,900 --> 00:22:47,900
Before the pandemic, half of 
people that have been laid off 

517
00:22:47,900 --> 00:22:50,900
are earning more staying home. 
And it says that this is going 

518
00:22:50,900 --> 00:22:54,200
to go on at least until July. 
So they have a very long time to

519
00:22:54,200 --> 00:22:57,600
reap the benefits of this. 
This amped up, stimulus package 

520
00:22:57,600 --> 00:22:59,400
unemployment until they need to 
get a job. 

521
00:22:59,600 --> 00:23:01,500
Again, all the way to the end of
July. 

522
00:23:01,500 --> 00:23:04,400
So you can see the issue here. 
This isn't a judgment on Alana. 

523
00:23:04,800 --> 00:23:06,800
She's not dumb. 
She's doing the same thing that 

524
00:23:06,800 --> 00:23:08,900
I would be doing or any normal 
person. 

525
00:23:09,200 --> 00:23:11,700
She's working a job at an 
airport as a bartender. 

526
00:23:11,900 --> 00:23:13,900
I'm guessing that's not her 
dream job. 

527
00:23:14,000 --> 00:23:15,600
That's not something. 
She wakes up in the morning, 

528
00:23:15,800 --> 00:23:17,300
really looking forward to going 
to. 

529
00:23:17,300 --> 00:23:20,800
So it would be nice if she could
just make more money, staying 

530
00:23:20,800 --> 00:23:22,300
home. 
And that's what the government 

531
00:23:22,300 --> 00:23:26,400
has provided her with. 
She has absolutely no incentive 

532
00:23:26,400 --> 00:23:29,400
to go back to work. 
She can risk getting a virus. 

533
00:23:29,500 --> 00:23:32,000
Iris and go back to work and 
earn less money than if she 

534
00:23:32,000 --> 00:23:34,400
stays home. 
Why would any normal person do 

535
00:23:34,400 --> 00:23:37,200
that? 
So this is a judgment on her or 

536
00:23:37,200 --> 00:23:39,700
anybody else in the situation. 
They're normal. 

537
00:23:39,900 --> 00:23:41,800
They're working off of normal 
incentives. 

538
00:23:42,000 --> 00:23:44,800
If you're paid more to stay home
and watch Netflix. 

539
00:23:45,000 --> 00:23:47,500
Most people are going to choose 
that option and I don't blame 

540
00:23:47,500 --> 00:23:49,700
them. 
But this does create a lot of 

541
00:23:49,700 --> 00:23:51,500
problems. 
It creates things that weren't 

542
00:23:51,500 --> 00:23:53,500
intended and that's exactly what
this is doing. 

543
00:23:53,500 --> 00:23:54,700
Half. 
The people that are being laid 

544
00:23:54,700 --> 00:23:57,800
off, are making more money, 
staying home, and this is 

545
00:23:57,800 --> 00:24:00,000
causing issues for employers. 
Unquote here. 

546
00:24:00,000 --> 00:24:03,800
It says it just puts Employers 
in an awful position said, mr. 

547
00:24:03,800 --> 00:24:07,200
Dinelli whose employees earn 
between 14 and 19 dollars an 

548
00:24:07,200 --> 00:24:09,200
hour. 
There's a big resentment there. 

549
00:24:09,400 --> 00:24:10,900
They're missing out on a lot of 
money. 

550
00:24:11,200 --> 00:24:14,000
So this guy employees people and
they're working for him, knowing

551
00:24:14,000 --> 00:24:16,800
that if he fired them, they 
would be earning more money than

552
00:24:16,800 --> 00:24:18,500
he's paying them. 
That's the situation he's put 

553
00:24:18,500 --> 00:24:19,400
in. 
So what does he have to do? 

554
00:24:19,400 --> 00:24:21,900
Does he have to artificially 
increase the amount that he's 

555
00:24:21,900 --> 00:24:24,600
paying them? 
So that he can beat out the 

556
00:24:24,600 --> 00:24:28,300
competitor unemployment? 
Now, unemployment is a 

557
00:24:28,308 --> 00:24:30,300
competitor in the amount of Say 
that they're getting. 

558
00:24:30,300 --> 00:24:32,400
That's the type of situation 
that employers are being put in 

559
00:24:32,600 --> 00:24:34,300
there competing with 
unemployment. 

560
00:24:34,700 --> 00:24:36,100
Not a good thing to have 
happened. 

561
00:24:36,500 --> 00:24:37,700
So we're printing a lot of 
money. 

562
00:24:37,700 --> 00:24:40,300
We're taking out a lot of debt. 
The fed's balance sheet is up to

563
00:24:40,300 --> 00:24:43,200
almost seven trillion dollars, 
which it's never been that high 

564
00:24:43,200 --> 00:24:45,000
before. 
So there's a lot of Uncharted 

565
00:24:45,000 --> 00:24:48,400
Territory, we're entering and 
we're creating a lot of bad 

566
00:24:48,400 --> 00:24:50,900
incentives for people. 
Now, it's better to stay home 

567
00:24:50,900 --> 00:24:53,200
than it is to go to work. 
You get paid more to stay home. 

568
00:24:53,200 --> 00:24:55,200
So this is causing a lot of 
issues. 

569
00:24:55,400 --> 00:24:57,100
There's some people that have 
talked about these type of 

570
00:24:57,100 --> 00:24:59,300
events happening. 
Charlie Munger is one of them. 

571
00:24:59,600 --> 00:25:02,400
This was back in 2019 before the
coronavirus. 

572
00:25:02,400 --> 00:25:05,800
So keep in mind, the context of 
when he said this, this was 

573
00:25:05,800 --> 00:25:08,900
before this recent event with 
all this money printing. 

574
00:25:08,900 --> 00:25:12,400
I am. 
So afraid of all democracy, 

575
00:25:12,400 --> 00:25:16,500
getting the idea that you can 
just print money to solve all 

576
00:25:16,500 --> 00:25:20,100
problems. 
And eventually I know that will 

577
00:25:20,100 --> 00:25:22,800
fail. 
He's so afraid of an economy 

578
00:25:22,800 --> 00:25:25,500
that gets the crazy idea that 
you can print endless amounts of

579
00:25:25,508 --> 00:25:28,800
money to solve all problems and 
he knows that that eventually 

580
00:25:28,800 --> 00:25:32,900
will fail. 
This stands in stark contrast to

581
00:25:32,900 --> 00:25:35,600
Jerome Powell. 
So they're on the other ends of 

582
00:25:35,600 --> 00:25:37,700
this drone pal, seems to have 
the idea that you literally can 

583
00:25:37,700 --> 00:25:40,400
print endless amounts of money 
to solve all problems. 

584
00:25:40,500 --> 00:25:43,000
He said that he's going to 
support the economy and all the 

585
00:25:43,000 --> 00:25:46,000
markets by offering liquidity 
printing, as much money, buying 

586
00:25:46,000 --> 00:25:48,700
as many assets until this blows 
over. 

587
00:25:48,900 --> 00:25:52,000
That's pretty much his strategy 
right now and Charlie Munger 

588
00:25:52,000 --> 00:25:53,100
doesn't think that's a good 
idea. 

589
00:25:53,300 --> 00:25:55,900
But he goes on to explain this 
further where he thinks this 

590
00:25:55,900 --> 00:26:00,500
leads Singapore, which has a 
marvelous economy as Zero debt, 

591
00:26:01,500 --> 00:26:04,000
if I were running the world, I 
would like the United States to 

592
00:26:04,000 --> 00:26:06,500
be in that position. 
That is not the typical. 

593
00:26:07,400 --> 00:26:11,700
That's that's nobody's position.
All these politicians in Europe 

594
00:26:11,700 --> 00:26:13,400
and America have learned to 
print money. 

595
00:26:13,700 --> 00:26:16,100
Who knows? 
When money Browning runs out of 

596
00:26:16,108 --> 00:26:20,300
control. 
And we at the end if you print 

597
00:26:20,300 --> 00:26:24,500
too much, you end up in 
something like benzoyl. 

598
00:26:26,000 --> 00:26:26,700
Keep in mind. 
Again. 

599
00:26:26,700 --> 00:26:28,600
This is before the recent 
downturn. 

600
00:26:28,600 --> 00:26:31,000
This is before the four and a 
half trillion dollars in debt. 

601
00:26:31,200 --> 00:26:34,200
The FED balance sheet going to 
seven trillion dollars and the 

602
00:26:34,200 --> 00:26:37,200
amount of money printing we've 
done over the past couple 

603
00:26:37,300 --> 00:26:39,700
months. 
So he's saying this before and 

604
00:26:39,700 --> 00:26:41,800
he says, it's going to lead to 
something like Venezuela, which 

605
00:26:41,800 --> 00:26:44,300
obviously they had a great 
economy. 

606
00:26:44,300 --> 00:26:46,900
Their GDP was growing. 
They printed a lot of money. 

607
00:26:46,900 --> 00:26:49,900
They devalued their currency. 
It got to a point where they had

608
00:26:49,900 --> 00:26:52,600
hyperinflation. 
So that's his opinion on the 

609
00:26:52,600 --> 00:26:54,900
subject. 
Not such a positive outlook on 

610
00:26:54,900 --> 00:26:57,300
it. 
He Really updated this so far. 

611
00:26:57,700 --> 00:27:00,100
Other than Warren Buffett. 
And Charlie Munger really 

612
00:27:00,100 --> 00:27:01,900
haven't bought anything during 
this downturn. 

613
00:27:02,000 --> 00:27:05,300
They said that they're there 
waiting this out pretty much, so

614
00:27:05,400 --> 00:27:07,600
that's not something. 
They typically do usually during

615
00:27:07,600 --> 00:27:09,000
downturns. 
We see them buying a lot of 

616
00:27:09,000 --> 00:27:11,100
assets, but I'll keep you 
updated. 

617
00:27:11,100 --> 00:27:13,300
If Charlie Munger has any 
opinion on the recent money 

618
00:27:13,300 --> 00:27:15,200
printing, I'll go ahead and show
that as well. 

619
00:27:15,900 --> 00:27:19,100
Now, on a related note, Elon 
Musk has a lot to say about the 

620
00:27:19,100 --> 00:27:22,000
same thing and he mimics some of
the same things that Charlie 

621
00:27:22,000 --> 00:27:24,300
Munger just said, so we'll be 
looking at that. 

622
00:27:24,400 --> 00:27:27,000
He's been in the news a lot. 
Lately for like five different 

623
00:27:27,000 --> 00:27:29,100
reasons. 
So, we have the whole drama with

624
00:27:29,100 --> 00:27:31,100
California. 
He doesn't like the lockdowns, 

625
00:27:31,100 --> 00:27:33,800
the way that it's being handled,
his kid's name. 

626
00:27:33,900 --> 00:27:36,500
That's another thing. 
What does the name X? 

627
00:27:36,700 --> 00:27:38,600
And then these weird symbols, it
mean Ash. 

628
00:27:38,900 --> 00:27:41,700
And then 8:12, I think is the 
name that he's giving his kid, 

629
00:27:42,200 --> 00:27:46,300
California is not going to let 
him name his kid that name. 

630
00:27:46,500 --> 00:27:48,700
That's what the news is that, 
they're not going to allow it. 

631
00:27:49,300 --> 00:27:51,300
I think they should for one 
reason. 

632
00:27:51,300 --> 00:27:54,400
It's Elon Musk, you know, it's 
not an exception for 

633
00:27:54,400 --> 00:27:56,500
billionaires to be able to name 
their It's weird things. 

634
00:27:56,600 --> 00:27:58,800
I think there should be a 
general exception. 

635
00:27:59,300 --> 00:28:01,700
You can name your kid, whatever 
you want. 

636
00:28:02,000 --> 00:28:04,500
If you sent a rocket ship out to
space. 

637
00:28:04,800 --> 00:28:06,700
If you've done that. 
I think we just make a broad 

638
00:28:06,700 --> 00:28:08,100
exception. 
Now. 

639
00:28:08,100 --> 00:28:10,600
You can name your kid. 
Whatever you'd like, X Ash, a 

640
00:28:10,600 --> 00:28:13,900
12, go for it. 
So I think they should allow him

641
00:28:13,900 --> 00:28:15,900
to name. 
This kid that, you know, it's 

642
00:28:15,900 --> 00:28:17,600
Elon Musk. 
Who cares? 

643
00:28:18,100 --> 00:28:20,100
Well, let's go ahead and jump 
into this portion of the 

644
00:28:20,100 --> 00:28:23,300
interview where Elon Musk talks 
about the same thing that 

645
00:28:23,300 --> 00:28:25,100
Charlie Munger was just talking 
about. 

646
00:28:26,000 --> 00:28:28,300
There's no shame though. 
That, you know, you can just 

647
00:28:28,300 --> 00:28:30,500
sort of send checks out 
everybody and and things will be

648
00:28:30,500 --> 00:28:34,500
fine is not true. 
Obviously the there's some 

649
00:28:34,500 --> 00:28:39,600
people have this absurd like 
view that the economy is like 

650
00:28:39,600 --> 00:28:45,400
some magic Horn of Plenty. 
Like it just makes stuff stuff. 

651
00:28:45,500 --> 00:28:47,500
You know, what? 
If it just there's a magic water

652
00:28:47,500 --> 00:28:49,600
plenty and the goods and 
services. 

653
00:28:49,600 --> 00:28:51,400
They just come from this magic 
Horn of Plenty. 

654
00:28:51,900 --> 00:28:55,000
And then if like, if somebody 
has more stuff than somebody 

655
00:28:55,000 --> 00:28:57,500
else's because they More from 
this magic Horn of Plenty. 

656
00:28:57,800 --> 00:29:01,300
Now. 
Let me just break it to the 

657
00:29:01,300 --> 00:29:05,800
fools out there if you don't 
make stuff, there's no stuff. 

658
00:29:06,900 --> 00:29:09,300
Now, of course, Elon Musk is 
100% Correct there. 

659
00:29:09,500 --> 00:29:13,100
I agree with them 100%. 
A lot of people do seem to view 

660
00:29:13,300 --> 00:29:16,300
the US economy, the way that 
he's describing that can provide

661
00:29:16,300 --> 00:29:18,300
infinite amounts of money to 
everybody. 

662
00:29:18,600 --> 00:29:20,800
And I don't think the government
really helps with that 

663
00:29:20,800 --> 00:29:24,100
perception by giving away 
trillions of dollars of stimulus

664
00:29:24,100 --> 00:29:26,500
in a couple months. 
It certainly does give you the 

665
00:29:26,500 --> 00:29:29,100
impression that we can just give
away infinite amounts of money. 

666
00:29:29,100 --> 00:29:31,200
This is something where a lot of
people I think have the wrong 

667
00:29:31,200 --> 00:29:34,700
perception of the US economy. 
You can't have only consumption 

668
00:29:34,900 --> 00:29:36,500
without production, the 
consumption. 

669
00:29:36,700 --> 00:29:39,800
Arms after the production. 
And I think Elon Musk has a 

670
00:29:39,800 --> 00:29:42,800
better understanding of this, 
because he sees a front row view

671
00:29:42,800 --> 00:29:46,500
in depth of the relationship 
between creating something and 

672
00:29:46,500 --> 00:29:48,500
consuming it. 
He's designing, and creating 

673
00:29:48,500 --> 00:29:50,800
these vehicles. 
He's producing them in these 

674
00:29:50,800 --> 00:29:53,700
factories assembling them, and 
then they're being consumed, 

675
00:29:53,800 --> 00:29:56,500
they're being enjoyed by people.
So he sees both sides of it. 

676
00:29:56,500 --> 00:29:59,600
He knows that you can't have 
just the the Tesla without all 

677
00:29:59,600 --> 00:30:01,900
the stuff that goes into, 
engineering it creating it 

678
00:30:01,900 --> 00:30:05,500
manufacturing it and selling it.
So he knows that all this work 

679
00:30:05,500 --> 00:30:07,400
behind the scenes goes Into 
creating it. 

680
00:30:07,400 --> 00:30:10,200
A lot of people seem to have the
perception that you can just 

681
00:30:10,200 --> 00:30:13,000
have the consumption side that 
things will work like that. 

682
00:30:13,100 --> 00:30:15,500
Obviously, that's not the case. 
Now the last part I'll share of 

683
00:30:15,500 --> 00:30:19,300
this interview is how quickly 
Elon Musk thinks the economy is 

684
00:30:19,300 --> 00:30:20,900
going to be opening back up how 
quick. 

685
00:30:20,900 --> 00:30:23,400
He thinks businesses are going 
to be here is what he has to say

686
00:30:23,400 --> 00:30:26,000
about it. 
Well, I think we're rapidly 

687
00:30:26,000 --> 00:30:27,700
moving towards opening up the 
country. 

688
00:30:28,400 --> 00:30:31,600
It's going to happen extremely 
fast over the next few weeks. 

689
00:30:32,000 --> 00:30:35,000
So he thinks it will happen. 
Extremely fast over the upcoming

690
00:30:35,000 --> 00:30:36,500
weeks. 
I agree with them, I think. 

691
00:30:36,700 --> 00:30:39,300
It businesses want to get packed
a business. 

692
00:30:39,300 --> 00:30:41,800
They want to open back up. 
We're seeing a lot of States 

693
00:30:41,800 --> 00:30:44,600
already open up a lot of 
businesses that have been shut 

694
00:30:44,600 --> 00:30:48,600
down, theaters, and Barbers, and
restaurants with lower capacity,

695
00:30:48,900 --> 00:30:51,100
all this type of stuff. 
So there's going to be some 

696
00:30:51,100 --> 00:30:53,300
politics at play. 
Some governor's, want to keep 

697
00:30:53,300 --> 00:30:55,900
things certain businesses, shut 
down longer than others. 

698
00:30:55,900 --> 00:30:58,500
That's going to happen. 
But generally speaking, I think 

699
00:30:58,500 --> 00:31:00,000
things are going to open back up
soon. 

700
00:31:00,100 --> 00:31:03,600
Now the big thing people are 
going to watch is a Resurgence 

701
00:31:03,600 --> 00:31:06,000
of cases. 
So we're going to be looking at 

702
00:31:06,000 --> 00:31:09,800
the new The cases and I'll show 
you if we have a spike in new 

703
00:31:09,800 --> 00:31:12,700
daily cases if we see that go 
back up, that's going to be the 

704
00:31:12,700 --> 00:31:15,000
big thing people look at when we
have the reopening of the 

705
00:31:15,008 --> 00:31:17,300
economy. 
Okay, let's get to some emails. 

706
00:31:17,300 --> 00:31:20,800
Joseph at Joseph Carlson 
show.com., That's Joseph at 

707
00:31:20,800 --> 00:31:23,100
Joseph Carlson show.com. 
If you'd like to email in a 

708
00:31:23,100 --> 00:31:26,000
question, you can also comment 
on the YouTube videos. 

709
00:31:26,700 --> 00:31:28,600
You can message me on Twitter or
Instagram. 

710
00:31:28,600 --> 00:31:31,900
I check those as well. 
The first one is from Maverick. 

711
00:31:31,900 --> 00:31:33,800
He says, hi Joseph. 
I am a young investor. 

712
00:31:33,900 --> 00:31:36,500
Only 20 years old. 
I have just gotten started and 

713
00:31:36,700 --> 00:31:39,400
Money into the market. 
At the beginning of the year. 

714
00:31:39,700 --> 00:31:44,100
I saw some gains briefly only 5 
to 10% and then this pandemic 

715
00:31:44,100 --> 00:31:46,500
happen. 
I am told time and time again, 

716
00:31:46,500 --> 00:31:48,600
that I shouldn't worry too much 
because I'm young and I'll 

717
00:31:48,600 --> 00:31:51,300
recoup the losses. 
However, it's difficult for me 

718
00:31:51,300 --> 00:31:54,700
to continue to keep dollar cost 
averaging when all I've ever 

719
00:31:54,700 --> 00:31:56,600
known right now is being in the 
red. 

720
00:31:56,900 --> 00:31:59,700
Should I continue on the path of
dollar-cost averaging every 

721
00:31:59,700 --> 00:32:02,700
month or so into Blue Chip 
companies, or should I hold cash

722
00:32:02,700 --> 00:32:04,700
right now? 
Well, this is a good question 

723
00:32:04,700 --> 00:32:06,500
Maverick. 
It's the age-old question. 

724
00:32:06,600 --> 00:32:09,000
Ian should you be holding cash? 
Should you be dollar cost 

725
00:32:09,000 --> 00:32:11,000
averaging again? 
I think you know what I'm going 

726
00:32:11,000 --> 00:32:13,400
to say before I even answer this
question. 

727
00:32:13,500 --> 00:32:16,400
I think you know the answer 
because I don't have a strategy 

728
00:32:16,700 --> 00:32:19,200
of holding a lot of cash and 
waiting around until a downturn 

729
00:32:19,200 --> 00:32:21,100
happens. 
The reason why is I don't know 

730
00:32:21,100 --> 00:32:24,400
if a downturn is going to happen
and even if I do know what's 

731
00:32:24,400 --> 00:32:26,000
going to happen. 
I don't know when it's going to 

732
00:32:26,000 --> 00:32:28,000
happen. 
So I might be waiting a very 

733
00:32:28,000 --> 00:32:31,800
long time with cash for a 
downturn so not a strategy that 

734
00:32:31,800 --> 00:32:36,400
I take to hold cash. 
I do think that there's some 

735
00:32:36,400 --> 00:32:39,400
space. 
In between going to cash and 

736
00:32:39,600 --> 00:32:41,900
having a full portfolio of 
equities. 

737
00:32:42,300 --> 00:32:44,700
I think there's there's room in 
between those two options. 

738
00:32:45,100 --> 00:32:46,600
A couple things that you might 
consider. 

739
00:32:47,000 --> 00:32:50,100
One of them is to have a 
portfolio allocation where it 

740
00:32:50,100 --> 00:32:53,400
doesn't matter to you if the 
stock market Falls because you 

741
00:32:53,400 --> 00:32:55,700
have the correct risk tolerance 
and portfolio. 

742
00:32:55,700 --> 00:32:59,000
Allocation may be a mixture of 
stocks and bonds like my 

743
00:32:59,000 --> 00:33:03,000
portfolio before going into this
downturn, a couple months ago. 

744
00:33:03,300 --> 00:33:06,100
I had 20% of my portfolio in 
bonds. 

745
00:33:06,600 --> 00:33:09,400
That turned out to be really 
helpful because when everything 

746
00:33:09,400 --> 00:33:12,600
else was going down bonds, they 
actually went up quite a bit and

747
00:33:12,600 --> 00:33:15,500
I was able to sell out a lot of 
those bonds to buy companies 

748
00:33:15,500 --> 00:33:18,700
that I think were undervalued. 
So that's something that I did. 

749
00:33:18,700 --> 00:33:21,600
I still hold ten percent bonds 
just in case, we have another 

750
00:33:21,600 --> 00:33:24,700
downturn, if we do have another 
big dip. 

751
00:33:24,700 --> 00:33:27,700
I have ten percent of my 
portfolio in these treasury 

752
00:33:27,700 --> 00:33:30,200
bonds that work as a hedge. 
So if a lot of people are 

753
00:33:30,200 --> 00:33:32,900
selling out of companies, they 
got to put that money somewhere,

754
00:33:33,400 --> 00:33:34,800
a lot of times that goes into 
us. 

755
00:33:34,800 --> 00:33:36,500
Treasuries. 
So that's the reason. 

756
00:33:36,600 --> 00:33:39,900
Have 10% in bonds. 
So there's a couple different 

757
00:33:39,900 --> 00:33:42,000
options you can do there. 
I think it's fine to have some 

758
00:33:42,000 --> 00:33:44,500
money in cash. 
You could make a portfolio 

759
00:33:44,500 --> 00:33:46,700
allocation, that's little bit 
more conservative. 

760
00:33:47,000 --> 00:33:49,100
You could have some of your 
money and treasuries and 

761
00:33:49,100 --> 00:33:53,300
corporate bonds, maybe but I do 
think the main issue here is not

762
00:33:53,300 --> 00:33:55,300
really what you're asking 
saying. 

763
00:33:55,300 --> 00:33:57,300
Should you dollar cost average 
or hold cash? 

764
00:33:57,600 --> 00:34:01,000
I think the issue is is that 
you're becoming less confident 

765
00:34:01,000 --> 00:34:03,700
in your Investments because 
you're seeing red. 

766
00:34:04,100 --> 00:34:07,600
I think that's the main issue 
here and That's something really

767
00:34:07,600 --> 00:34:09,900
tough to deal with. 
Like Mike Tyson says, I think 

768
00:34:09,900 --> 00:34:12,400
the phrase is everybody has a 
plan until they're punched in 

769
00:34:12,400 --> 00:34:14,400
the face. 
That is kind of the same with 

770
00:34:14,400 --> 00:34:16,500
the stock market. 
You have your plan. 

771
00:34:16,500 --> 00:34:18,600
You're excited. 
You start investing dollar cost,

772
00:34:18,600 --> 00:34:21,000
averaging you buy all these 
companies that you want to buy. 

773
00:34:21,500 --> 00:34:23,000
And then the stock market goes 
down. 

774
00:34:23,100 --> 00:34:25,500
You see yourself entering the 
red, you're losing money every 

775
00:34:25,500 --> 00:34:29,199
day, all of a sudden, the plan 
that you had doesn't seem so 

776
00:34:29,199 --> 00:34:31,100
great. 
You're just looking at yourself 

777
00:34:31,100 --> 00:34:32,699
losing money. 
So this is something I think 

778
00:34:32,699 --> 00:34:35,199
that stuff to deal with, you 
have to change your mentality 

779
00:34:35,199 --> 00:34:36,500
and realize that you're in this 
for the long term. 

780
00:34:36,600 --> 00:34:37,800
ERM. 
You're 20 years old. 

781
00:34:37,800 --> 00:34:39,900
You're really young guy. 
You're going to be investing for

782
00:34:39,900 --> 00:34:42,199
at least 10 to 20 more years at 
a minimum. 

783
00:34:42,500 --> 00:34:45,100
So you're at the very beginning 
of your investment Journey. 

784
00:34:45,400 --> 00:34:48,199
This isn't something that you 
should be concerned about at 

785
00:34:48,199 --> 00:34:49,699
all. 
If the stock market goes down a 

786
00:34:49,699 --> 00:34:51,699
little bit. 
In fact, you should be taking 

787
00:34:51,699 --> 00:34:54,500
the opposite approach and 
celebrating the decline in 

788
00:34:54,500 --> 00:34:56,699
prices. 
Even if you previously bought a 

789
00:34:56,699 --> 00:34:59,900
higher price, even if you've 
been investing and you have a 

790
00:34:59,900 --> 00:35:03,000
some companies go down in value.
The stock market going down is a

791
00:35:03,008 --> 00:35:05,500
good thing in your phase of 
Investments. 

792
00:35:05,600 --> 00:35:07,500
It's going down. 
Now, that's a good thing. 

793
00:35:07,500 --> 00:35:11,000
So, I think the mentality that 
you have to have is one where 

794
00:35:11,000 --> 00:35:13,900
you really figure out a 
portfolio, allocation that fits 

795
00:35:13,900 --> 00:35:16,500
with what you're wanting to do 
and you need to celebrate when 

796
00:35:16,500 --> 00:35:19,000
the stock market goes down. 
As long as you're in the buying 

797
00:35:19,000 --> 00:35:22,800
face, what you clearly are. 
So a change in mentality, I 

798
00:35:22,808 --> 00:35:25,700
think so needed thing. 
And to answer your question. 

799
00:35:26,200 --> 00:35:28,600
I don't really have the approach
of holding too much cash. 

800
00:35:28,800 --> 00:35:30,100
I don't have anything against 
it. 

801
00:35:30,400 --> 00:35:33,400
I just don't really like the 
strategy that much myself. 

802
00:35:33,400 --> 00:35:36,000
I'd rather just build a 
portfolio that I think can go 

803
00:35:36,000 --> 00:35:37,900
through. 
Different environments and 

804
00:35:37,900 --> 00:35:40,500
continue with that plan. 
Carter says hi Joseph. 

805
00:35:40,600 --> 00:35:42,900
I've been watching lots of your 
investing episodes lately on 

806
00:35:42,900 --> 00:35:44,600
YouTube channel and have a quick
question. 

807
00:35:45,000 --> 00:35:47,000
How would you recommend someone 
new to investing? 

808
00:35:47,000 --> 00:35:49,800
He's into the stock market? 
I don't have much capital, and I

809
00:35:49,808 --> 00:35:51,500
don't want to put that little 
amount. 

810
00:35:51,500 --> 00:35:54,600
I have all in right away. 
However, I'm afraid only of 

811
00:35:54,600 --> 00:35:58,000
putting a small amount in will 
never return any results that 

812
00:35:58,000 --> 00:36:00,600
are really worth noting. 
Can you help me with the 

813
00:36:00,600 --> 00:36:03,000
situation to give some 
background? 

814
00:36:03,200 --> 00:36:05,900
I just recently invested twenty 
five hundred dollars into an 

815
00:36:05,900 --> 00:36:08,500
index fund. 
It's similar to the S&P 500 to 

816
00:36:08,500 --> 00:36:11,000
hopefully have my money grow 
rather than sit in a savings 

817
00:36:11,000 --> 00:36:13,200
account. 
However, this is over 50 percent

818
00:36:13,200 --> 00:36:15,800
of my total cash. 
I'm just unsure of the path to 

819
00:36:15,800 --> 00:36:19,300
follow and I realize, I have to 
play it long term, but it's hard

820
00:36:19,300 --> 00:36:22,600
to do that without being able to
really dive into start. 

821
00:36:23,000 --> 00:36:25,300
If you could help guide me and 
possibly others through this, 

822
00:36:25,300 --> 00:36:28,400
that would be great Carter. 
I think you're overthinking this

823
00:36:28,400 --> 00:36:30,400
a little bit. 
You put twenty five hundred 

824
00:36:30,400 --> 00:36:33,800
dollars into the S&P 500. 
You said that's over 50 percent 

825
00:36:33,800 --> 00:36:36,000
of your total cash. 
You're not sure what path to 

826
00:36:36,000 --> 00:36:39,800
follow. 
Investing is a very long-term 

827
00:36:39,800 --> 00:36:42,200
thing. 
You're not going to build up a 

828
00:36:42,200 --> 00:36:46,100
big portfolio that you can rely 
on for passive income or to tap 

829
00:36:46,100 --> 00:36:49,300
into later on in life. 
If you don't build it up on a 

830
00:36:49,300 --> 00:36:53,100
consistent basis, so you're 
right that 2500 dollars in and 

831
00:36:53,100 --> 00:36:56,100
of itself if you did nothing 
invested no more money. 

832
00:36:56,400 --> 00:36:59,000
That's not going to do a whole 
lot over the course of your 

833
00:36:59,000 --> 00:37:01,800
life. 
It might double or triple or 

834
00:37:01,800 --> 00:37:04,500
quadruple. 
But even then it's you know, 

835
00:37:04,500 --> 00:37:06,500
it's not going to turn into a 
fortune that you can rely on. 

836
00:37:07,100 --> 00:37:09,200
The way that you build up 
Investments is through 

837
00:37:09,200 --> 00:37:12,900
consistent effort, every single 
paycheck that you have, some of 

838
00:37:12,900 --> 00:37:15,400
that money that you earn needs 
to go to savings and 

839
00:37:15,400 --> 00:37:16,900
Investments. 
That's the way that you build it

840
00:37:16,900 --> 00:37:20,600
up whether it's $50 every 
paycheck or 100, you know, it's 

841
00:37:20,600 --> 00:37:22,500
different amounts for different 
people that earn different 

842
00:37:22,500 --> 00:37:24,600
amounts of money. 
You need to figure out how much 

843
00:37:24,600 --> 00:37:27,200
money you can put into 
Investments and be really 

844
00:37:27,200 --> 00:37:30,900
consistent with it. 
So, depending on your situation,

845
00:37:30,900 --> 00:37:33,700
I don't know how much money you 
make, but if you don't make a 

846
00:37:33,707 --> 00:37:36,400
lot of money, try putting a 
little bit into Investments 

847
00:37:36,400 --> 00:37:38,700
every single Week. 
It might not feel like a lot, 

848
00:37:38,700 --> 00:37:42,400
but it adds up over time, and 
then situations do change. 

849
00:37:42,400 --> 00:37:46,000
If you end up making more money,
but your life is adjusted to 

850
00:37:46,000 --> 00:37:48,400
making less money. 
Now, you're able to invest at a 

851
00:37:48,400 --> 00:37:50,900
much higher rate because you've 
already figured out how to 

852
00:37:50,900 --> 00:37:52,600
invest, how to be consistent 
with it. 

853
00:37:52,800 --> 00:37:55,900
But now you're making more money
and you're budgeting for a lower

854
00:37:55,900 --> 00:37:58,200
budget. 
So, you know, circumstances 

855
00:37:58,200 --> 00:38:00,300
change, if you end up making 
more money, you can invest at a 

856
00:38:00,300 --> 00:38:03,700
higher rate, but consistency is 
the key, every study that I've 

857
00:38:03,700 --> 00:38:06,800
read, all the stuff that I've 
read on the subject people. 

858
00:38:07,000 --> 00:38:10,300
That consistently put money into
their portfolio and they buy 

859
00:38:10,300 --> 00:38:12,800
Quality Companies. 
They come out on top. 

860
00:38:12,900 --> 00:38:14,900
So don't worry about the 
absolute dollar amount. 

861
00:38:14,900 --> 00:38:16,300
How much money you can put in 
right now. 

862
00:38:16,500 --> 00:38:18,600
Worry about being consistent? 
Okay. 

863
00:38:18,700 --> 00:38:21,000
Well, thank you for the emails. 
I'm going to go ahead and end 

864
00:38:21,000 --> 00:38:23,200
this episode there. 
I will talk to you guys soon.