Danny Jones Podcast - #53 - The Economy, Real Estate, & Investing | John Hyre

Episode Date: October 2, 2020

John Hyre is an attorney, accountant & investor living in Puerto Rico for tax incentives. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Welcome, John. Glad to be here. Cheers. Righto. Thanks for coming here from Puerto Rico. Yeah, and thanks for the really good drink. One of us has got bourbon with a little ice and one of us has other. I got four pieces ice with a little less bourbon because I'm not a bourbon

officiantado like yourself. Oh, okay. Well, that's a good excuse then. I'll go with that. So you are a financial expert, a tax accountant. You can teach me how to get rich. I can teach you how to keep your money. So I'm a tax lawyer first, a tax accountant second.

and an investor third. And that's probably about my order of competence. I'm good at finding deals. I have not always been real good at finding the proper partners with those deals. And the practice keeps me so busy that it's got to be passive. So ideally when I invest, I find the deal. And just because almost all my clients are real estate investors, I got a list across the nation.

I hear about things. Add to it since I moved to Puerto Rico, you got a lot of hedge fund guys there? you know one of the deals I'm investing in that how did I meet the guy he was up on the balcony kind of like Juliet only not smoking a cigar I had a cigar I look up and I'm like you got a cigar I got a cigar and he's like well come on up and let's have another cigar never didn't know the guy we get the chatting he moved there he sold us tech company in California starts a small hedge fund and this was before he even had partners and we just started BSing because it was a love fest

I'm looking at him with these huge eyes because I've never been inside so I had a hedge fund. It's a little one. But just how they find deals, how they think, how they do things, that's fascinating to me. I'm used to dealing with just straight real estate investors who are creative enough and do enough interesting stuff. And then he in turn had never really dealt with self-directed IRAs, 401Ks, ways for people to invest tax free through their pension plan. And what really caught his attention is people can use those accounts to invest in your hedge fund. And he's like, no, they can't. My friends are at Microsoft.

They got these huge 401Ks, and it can only be invested in the market or Microsoft. And I'm like, there's ways to get that money out into a 401K that's self-directed, and they can invest in your thing. Well, that caught his interest real quick. So we've since become buddies. I'm being personal friends. And I'm now, I optimized one of his little tiny funds to invest with IRAs, helped bring some money in.

In fact, we're getting ready to pull the trigger on that. So you meet some neat people. So what am I good at? I'm good at legally sticking the government with their own rules when it comes to taxes. I got this odd attitude, because evidently in 2020 America, it's a strange attitude. I think if you earn it, you should be able to keep most of it. I don't think taking 50% of your income or even a third of your income is right. So morally, I like what I do.

I like complicated games. I got alpha in me. I like to win. I'm the kid back before computers. We had those big board games. where you would recreate the battle of the bulge with 500 little paper cardboard pieces on the board made by a company called Avalon Hill.

I love that. I like winning. So the code for me is a game. I want to win. And finally, it pays well. So that's what I'm good at. So why did you originally move to Puerto Rico? And what were you doing before you moved? All right.

So we moved to Puerto... Let's start with before. Yeah. Grew up in Youngstown, Ohio, which is like the Sopranos without the good restaurants. Huge mob presence. Great Sicilian food. lots of union corruption, not a lot of jobs there anymore. It's a place in decline. It's the kind of place

Bruce Springsteen or Billy Joel would sing about. Move to Columbus at 18 to go get my degree, did business undergrad finance and accounting, did law school there as well, a lot more jobs in Columbus, Ohio than Youngstown, Ohio. So it was there for, well, let's see, roughly 48 years, and then moved to Puerto Rico about 18 months ago. Why? There are two reasons. And a third one has grown on me to stay. The first reason is one of the biggest tax breaks ever. So my tax rate on my practice.

My practice is virtual. My clients are all over the country. It's all federal income tax and asset protection. It's all done over the phone or the internet. So I can practice from anywhere. The original plan was when the final child, presently, I have three kids, and the youngest one presently carries the title worst child, capital W, capital C. We actually have a trophy that you are officially the worst child.

That's the youngest? Yeah, yeah. And she's very proud of this, by the way. Oh, wow. Because for a long time, the middle one had that for a long time, and she was really pleased to take it away from him. When the worst child went to school, that's when we knew we could move somewhere.

The original plan, since my practice is virtual, six months in Germany, six months in Argentina, six months in Colombia, six months in the UK, just go and be a nomad and be. get to know things and see things. But then I went on a cruise to Puerto Rico and I found about this tax break they got. If you, and this is really simplified, but if you export goods or services, so in my case, I'm exporting services. My clients are in the states. They all pay me from the states, but I perform the service in Puerto Rico. I live there. That's where I do my billable hours

and all that sort of thing. My tax rate, federal, state and local combined, all of it, is about 6% flat. So we're saving a stupid amount of money. That was the first reason to move there. The second reason. My wife is a Chilean, so a Latina. And with Latinas, they're very passionate, which is really great if they're happy. If they're not, yeah, if they're not, I mean, she explicitly mentioned to me, this Lorena Bobbitt, she was an amateur. Do you know why? They were able to fix him. They will not be able to fix him. They will not be able to fix You. So it's kind of like, all right, I kind of know where I stand here. Better keep her happy. And it's our joke. And when we go back and forth, I grew up with a Latin mom, I speak Spanish, so I get the drill.

But bottom line, happy wife, happy life. Absolutely. And so what did she tell me once the little one goes off to college? There are two things I want. I want to go somewhere where there is Spanish and there is not snow. Yes, dear. So that was, you know, really the other. But she, she went there. She went there. She's an artist. She does sculpture. So opposites attract. I'm as square doll of a nerd as you can possibly get. I mean, I'm a tax lawyer. She's an artist and utterly, like even by Latin female standards of swirling vortex of chaos. And it works, right? I can't marry me. I would kill me. Yeah, you got the yin and yang, right? Yeah, so it works. So she's happy. She's going to this great art school in Old Sun Juan, where we live. She can walk to school. She's happy. She's happy. Life is good. The third reasons, we move there for two reasons.

I'll tell you the other thing that's stuck with me. They're just something special. Maybe it's the Caribbean, maybe it's that island. People have so much fun, and they're so kind. I don't know if it's in the air, it's the people, it's the water. There's just this mix where you de-stress, and I can't tell you how much that's worth, how happy I am. The networking there, in terms of professional, like this hedge fund guy,

you meet all sorts of interesting people who are there, the way I am. But you also just meet a lot of plain fun people that are fun to be around and you relax and you enjoy life. And you hear the cliche about Latin America or the Caribbean. And the reason you call it a cliche is there's no better way to put it. But it's true. No less that it's a cliche, it's still true. And so if they took the tax break away, I'll bet you I'd still be there six months of the year. We like it that much. Yeah. That's a different vibe when you're there. There's a different feeling in the air when you're on an island like that, especially in the Caribbean when you've got the beautiful blue water,

just being there. It's just a completely different feel and a different way of life. Something about it, you can't really put words to. But it's there. And what I like about Puerto Rico, it's one of the bigger islands. So here's a significant, relevant. It wouldn't sound like it. It sounds trite, but it's not.

There was enough people there, three and a half million. There's a lot to do. There are three cost cos on the island. Now, if you've ever lived somewhere where you don't have you know, the spoiled America and retail luxury, because we live in consumer paradise. And to have a little piece of that consumer paradise still there as compared to, because people can do this, for example, on St. Thomas. But St. Thomas is what, like 30,000 people, if that. And there's a lot of stuff there. They just plain don't have. So what I like also is the critical mass, the size of the

island, means that most of the stuff, like I miss whole food. I like whole food, just good stuff, solid, clean, and I like clean eating. That's harder to find there. So it's not the same as being here, but there's enough that it works. Right. Absolutely. So when did this tax law come about in Puerto Rico? When did they put that into place? So Puerto Rico put it in place in 2012. You've got two components. You've got U.S. law, and then you got Puerto Rican law, and they have to work together. So the U.S., I don't know when they did. It's Internal Revenue Code Section 933, says that if you're a Bonified permanent resident, essentially a full-time resident of a U.S. territory, Guam, Puerto Rico, St. Thomas, whatever. You pay that government instead of the feds for any money you earn there.

And the idea is that since they're not states, we're going to give them an upside that states don't get. So there's a downside. They're not a state. For example, I don't get to vote in the upcoming election. I'm still going to send money, right? I want my guy to be able to buy votes or at least rent them. What do you mean by that? Oh, campaign contributions.

Oh, campaign contributions. Yeah, that's it. He was just here. Trump was just here two weeks ago. Yeah. It was a hundred grand a handshake. You know? Worth it, right?

Yeah, the man's. Would you have done it? No, not for 100 grand. I could get a lot of satisfaction from, well, let's not talk about that. You know, when I was young, that sort of thing was on paper, and now it's on the internet. But I digress. So back to 933, what they said was, so you territories aren't states. And there's some downsides to that.

But we're going to give you an upside. We're going to try and balance this out and be fair. your people don't pay federal tax. And instead, you can tax at federal rates or even higher on your island, in your territory. So Puerto Rico has its own tax system, and most of the people there pay no federal tax. That's Section 933. Why is that good for me? Because if you just move to Puerto Rico, what you're going to find is, and I'm sorry to say this,

I love Puerto Ricans except for one thing. They're politics. They're warm. They are aggressively friendly. They want to be your friend, and they're good at it. But their politics are horrible. They don't call it socialism, but that's what it is. If you want to see what the U.S. will look like if we continue down that path, just go to Puerto Rico.

We can talk about that. For example, they got the equivalent of Section 8, what we call in Puerto Rican Spanish Casarios. They put it in all the nice neighborhoods. And by the way, there's HUD regulations to do exactly that that Obama passed at the last minute just before Trump took office, which is a normal democratic trick. you put in regulations that are unpopular at the last minute. So the guy that comes next has to enforce stuff that nobody likes, and he takes the heat if he enforces it. And then if he repeals it, you can say he hates poor people,

which is what they're saying. So these regulations would give HUD control over the suburbs. They would take over zoning. And they would require a certain amount of high-density housing. That's a euphemism for low-income in Section 8. Let me tell you how that worked out in Puerto Rico, because they had the same idea. They did this in the 50s.

They built the projects, the Casadios, and they said, it's going to help the poor people to put them in rich neighborhoods. No, you screwed up the whole island. There's crime everywhere. You don't really have, I mean, it's so block by block there. You can have a really nice house or neighborhood or block, and then a block later you've got projects in ghetto. And some of the social justice people think that's a great idea.

Come down and live it. You can't go anywhere at night without paying attention. There are a couple places that you can go. You get used to it. So do I know where to go? Yeah. And I also know the look, what some of the security guys would call. I'm always code yellow.

I'm never code white in Puerto Rico at night. During the day, you're fine. You can go anywhere. At night, you're code yellow. You pay attention to what's going on where you are. And that's in San Juan. Once you get out in the country, like anywhere else, there are less issues. But if you want to see what it's like to put, quote unquote, let's use the euphemism.

Let's be polite. The low, the high density housing. If you want to force that into the nice suburbs, it doesn't uplift the poor. It screws up the area. It screws up crime. It may not be PC, politically correct. It is factually correct.

And anyone who wants to come see it, I can walk them by the projects at night and see how they feel about that. They're going to get real uncomfortable and edgy. So there is a downside. Crime rates there are pretty high. You do have to watch yourself. You got to know what you're doing and where to go.

Thank God, I live in a tourist area on purpose, where if a tourist gets mugged, the government loses money. And so when it's about their money, you're damn right that there are police everywhere. Nobody gets mugged in Old Son Juan. That's very rare to see crime there. And that's one reason we're there. But everywhere else, you kind of have to watch yourself. So it's not perfect.

It's not paradise. It has its issues. So how do you deal with your clients and how do you conduct business? I assume you have employees in Puerto Rico? Do you have like an office with employees? Let me back up and answer your question. Because like I just wander. Stream of consciousness, ADD, entrepreneur.

Bourbon will do that. Yeah, what's going to do a lot more of that? And I already start pretty ADD. So Puerto Rico has normally a really bad tax system. That's why I call them socialists. For us up here, the federal tax bracket of 33%, you got to make around 250, 300 grand to be in that bracket. Down there, it's 60 grand.

They jammed you into that bracket. So you don't want to live there as a normal person. But if you go under one of the incentive programs, and there are several I'm not mentioning, I'm under two. One of them says my exportation of my written material, my webinars that I sell, plus my exporting my services, as long as I'm not competing with locals, that's their point. They don't want me to compete with Puerto Rican lawyers. They want me to sell to clients. The Puerto Rican lawyers wouldn't get anyway.

So as long as I export all my services, I get a special rate, that's 6%. So that's the Puerto Rican law. U.S. law says if I live there really pretty much full time, we can talk about that. There are specific rules, but it's pretty much full time. U.S. won't tax me on my income that I generate there. And then Puerto Rican law says, if I'm a good boy and export my services and hire a few people, I get this really good rate. And it fit into exactly what we do anyway.

So what do we do? It's changing a little. I do mostly planning work for real estate investors, small businesses, self-directed IRAs, self-directed 401 case. I would say those are the three things. Back when the internet was young, so we're talking late 90s. I was leaving my corporate job. This was before accountants and tax lawyers were specialized. You didn't have a lot of guys, especially for smaller investors. Like if you were, you know, if you were one of these huge, I don't know, name a huge real estate investor. See, I'm so old, I think a Leona Helmsley, which kind of dates me. But whoever, Trump,

yeah, Trump. He's got specialized tax help, which by the way, I love reading the the New York Times articles on how he screws the government. Because I use, they paint it like he's cheating. This is wrong. And then I look at what he did. And like, I do that for clients every day who make way less. That law applies to everybody. And we can get into some of that because the guy, as he,

I don't always agree with what Trump says. Here's my issue with what Trump says. I don't think about what Trump says because Trump clearly doesn't think about what Trump says. But I'm very interested in what he does. And so if we get time, I'll talk to you about some of the tax end runs that he's used that apply to real estate investors. Because I do research those.

Every time the New York Times says he's an evil man, he cheated the system. I'm like, I'm interested. I know how to do that. And it always ends up being something I've already done. So with our clients, it's almost all virtual. It's very rare for someone to come into the office. Pre-COVID, we would do seminars in Puerto Rico in person. And some people after the seminars would come by for an appointment.

that accounts for about 95% of my office, foot traffic. No one ever visits me. Right. So it's going to be mainly phone, internet, mostly planning. So what we like to do is look at somebody's entire structure. And I mean, we go through the books, we go through the returns, we go through the entities, and we figure out how to improve it. And 95, 96% of the time, I can figure out enough that it's well worth what I charge.

Four or five percent of the time, I look at somebody's stuff and say, you know what? If it ain't broke, don't fix it. You're doing fine. But then I give them some inflection points. But let me tell you some things that if they change, you want to come talk to me. If you do this, if you acquire that, if you sell that, if you change this business, if you grow that one or cut this one, I want to know. Because now we can do something. So it's mostly planning and consulting. I do fight the IRS. If we get time, we should talk about that. Yeah. Fighting them is fun. Yeah, I just had a guy in here who spent about 10 years fighting the IRS because he was a, top executive of Scientology and they won. You know about Scientology. Oh, yeah. That when they,

that was an interesting story, huh? The Scientologists win? Yeah, they're a religion now. Okay, yeah. So, so the IRS was arguing they weren't a religion. Exactly. Oh, they're going to lose. Yeah, but you told me they lost. I could have told you they were going to lose that argument. Oh, it was a, it was a good story. Because a big Scientology area here, right? Oh, this is like the hub of Scientology here. Yeah. Yeah. Yeah, I've had a few clients and, you know, whatever it is, you think of it, you can agree, you can disagree. That's a religion. Let me tell you what else is a religion it hasn't been ruled what yeah i mean how do you define what is or what isn't a religion has to do with belief but that's the whole point belief and so here here's my my point and i'm digressing and we'll come back and i'm sure you're sure bring people back to talk rational i don't know

i don't know i don't do it i'll figure it one day um woke being woke is a religion it's a substitute it's for people who don't have an actual religion because humans need to believe in something bigger and to be part of a bigger cause. We're social creatures. We need something that is bigger and more important than us. And so we've decided that actual religion doesn't work. And so we have a manufactured religion, which is political. It's not just the woke people. They're the worst. Because seriously, try and talk to them. Facts don't matter. And they'll kill you. What do you mean by a woke person? What is your definition of woke? All these holier than now politically correct. left-wing socialist Bernie-loving.

Basically the people who, they're the ones who will correct my vocabulary and tell me that certain terms are inappropriate. For example, I think there are two genders. Call me crazy. Now, do I think we should be cruel to someone who's confused about that? Because there's a grain of, to everything,

even the biggest lie, there's always a grain of truth. So let's talk in terms of how the woke view transgenderism. They make it a cause. They make a big deal out of it. What percent of the population is that? Not very high. Right. They make it so that you have to accept it. They jam it down your throat or they will ruin you. You lose your job. If you say, I don't agree with this.

If you say, I think there's only two genders. On a related topic, if you say I disagree with BLM, which, by the way I do, I disagree with capital letter BLM. I agree with small letter BLM. In other words, I actually do think black lives and all lives matter. But the actual BLM movement, I think, is profoundly corrupt, and it's not what it purports to be. the woke people believe in that. That's a touchstone of their religion. That's like a saint.

That's like in any other religion, if you say, I think your saint is, I don't know, a criminal and molests children. They get upset. And the woke religion, if you disagree with BLM, they just start having fits. But it's a substitute.

It provides them meaning, a larger sense of purpose, a cause to which to belong. The problem is it's not amenable to discussion. They're not looking to talk to you. They're looking to shut you down. just like the Christian wars in Europe and the 1600s.

You're a heretic. We're going to ruin you. And there they would actually kill you. Like, oh, we got a stake. Let's tell you to it and light you up. But there was a lot more of, we'll fire you. You'll lose your job.

You won't get a degree. You'll never succeed. That sort of thing is happening. And if you look at that, this whole progressive, woke thing as a religion, which the irony is, most of them hate religion, and so the fact that they have a fake religion, and they don't even

see that, is irony beyond belief. Yeah, it's definitely a very strong ideology. You used to think that, or I grew up thinking that being progressive or like having family, I grew up with like family who were very progressive and Democrat. at my mom was uh grew up being she was a teacher she was a uh college professor that'll do she taught art she was very very she still is and you know when i was young i used to just think like you know that was you know more educated people people who care about the environment people who are creative they're the people who are more left-leaning and i think a lot of people

still think that way. A lot of like young people especially in big cities, I don't know when that became a thing. I don't know, it seems like all cities, very dense populated cities like New York or L.A. are like that as well. And as well as college universities are like that. But a problem, I think a problem is people, they don't like to, it's convenient not to look behind the curtain or look through the veil and really try to look at the little policies of the differences between left and right and what things they can have a conversation about. Because, I mean, at the end, there is no conversation.

That's the problem. But I would say the same thing about the right. I would say there's a lot of people around here who are the same way, but on the complete opposite end of the spectrum. Let's clarify, because when you have two parties, you have two very large tents with a lot of different sorts. So, for example, each party is going to have its share of lunatics and idiots. The question is how high is that share? Right. Let me give you another quick example. Whenever I used to think of Republican, I would think of people who are business owners,

people who have a lot of money, they don't want to pay taxes, right? That's the first thing I would think of, right? You're an investor, you're an entrepreneur, you have a lot of money. A rich guy is always going to be a Republican, especially around here. Now it seems like it's poverty, it's more of like white trash poverty, like the trailer parks, they're all Republicans now. But they don't make money. They don't have a lot of money. Those people are on food stamps. Those people are on unemployment. But they're still hard, you know, they all have Trump flags. It's like a, it's like a whole new political party. It's not really Republican. There's a great. It's an ideology. There's not really. There's a great book. It's a religion. I have to find the name of it and send it to you. I can't remember it off the top of my head. And I read it like three weeks ago. But again, the ADD, the Heidel goes out of my head. Let's break this down so we can talk just about all this because it's fascinating and there's a lot to it

and we're living it. So the Republican Party under Trump has gone more populist. The people you just described, lower income, basically white trash. They know you think of them that way. They know everyone thinks of them that way and it pisses them off.

They used to be the guy that worked in a factory and was proud and made money and put bread on the table. And you know what they lack now? Hope. There was a great study, a series of studies done in us, what this book focused on. If I have a minute during a break, that's on my nook, I'll look it up. What the guy did is he went and looked, who voted for Trump in the primaries, not during the general election.

During the primaries, who voted for Trump and who didn't. And he found some interesting correlations. The people who voted for Trump, to name two examples, were either from very wealthy areas. He used the example, I think, of Chevy Chase, Maryland, where they have their own set of, they have, They create community. They're that kind of people. If you live, I think it was like 6,000 of them, they all know each other. They have their gardening clubs. They have their churches.

They go together. They have their reading clubs. There's a sense of belonging and community. Likewise, all over the country, anywhere that was heavily, get this, anywhere that was heavily Dutch, places like Holland, Michigan, there's a place in Iowa. I forget which county, but it's still heavily Dutch. And the way you can tell is the Dutch. Dutch Reformed Church is the primary church there.

And then you look at the last names of people, a lot of VANs, you know, Van Sluut, Van Clute, whatever. Because the Dutch, those communities where they still have either a majority or close to it, like Holland, Michigan, they're very tight-knit. They're united around a certain culture that they imported from the Netherlands that they've kept over the generations, a hardworking bourgeois values, classic bourgeois values. of you graduate high school, you get married, then you have kids, and you're honest, and you do the right thing, and they belong to that church, which provides a locus of community. So why do I mention that? Those people hate Trump. The wealthy Republicans who live in places that have community,

places that are very tight-knit like Dutch communities, and they also looked at some of the German communities that were similar throughout the upper Midwest, they hate Trump. Who love Trump? the people whose communities were broken and gone where there's no church, there's no rotary, there's no bowling. There's been a lot written on this in terms of alienation and not having a sense of connection and community.

So it goes exactly what I'm talking about. See, let's circle around now. You're right, there are portions of the right. Now, the right is generally more religious, like having an actual religion than the left in general. And the left tends to go more mainline, which is dying,

than evangelical or Mormon or, you know, a little bit more outlying. That's a substitute for religion. These people who are really... Wait, what's the substitute for religion? Politics. Politics. Trump worship. Right, right, right, right.

So I think that Trump worshippers are a much smaller part of the right. I mean, true honest to God, Trump worshippers. I'm not one. I voted for him. For me, in the last election, it was crazy versus evil. And I figured with crazy, I got a shot. And crazy's worked out pretty well. I don't like what he says.

I like most of what he does. Now, this election is different. Yeah, I mean, I hear a lot of smart, logical, rational people who like Trump. But most of the people that I meet who love Trump are not that. No, so you could just hit the point on the head. I don't even like Trump. Personally, for example, I think him personally, he's nuts. He's a narcissist.

I used to think Obama was a narcissist, and he is. I used to think both Clintons were extreme narcissists. And they are. Man, Trump puts these people to shame. That dude is the walking poster child picture in the dictionary definition of self-obsessed narcissists. There's no question. He's nuts. I mean, that's a disorder.

He's nuts. The problem is the entire other party is nuts when you look at some of the stuff they want to do. But let's come back to the substitute for religion. So you got guys like me who voted for the lesser of two eels. I did not vote for Trump in the primary. I fit the definition of a guy who is pretty comfortable, live in a pretty tight-knit community. I have human connections. I'm happy.

I'm not hopeless. Those people who live in those areas, these desolate wastelands, and if you drive through the Midwest, the Rust Belt, especially Appalachia. Appalachia, yeah. Man, it's town after town. There's nothing. It's broken. It's dead. They don't believe in religion anymore.

The church is boarded up and gone. They need something to believe in. And just as the woke believe in government, that's their God. The absolute Trump fanatics versus the people who voted for him like me, but it was him or the other one. So I like what he does. I don't like him at all. I'll vote for him. Well, I can't vote from Puerto Rico, so I'm going to contribute to his campaign so that he can rent some votes on my behalf legally.

Let's make that very clear, legally. But the true Trump lovers, yeah, there's a certain cultural commonality. There's a certain, and I'm not saying it good or bad. I grew up with these guys, right? Youngstown, Ohio, actually matches a lot of what I'm talking about. These guys were hardcore Democrat Union guys. And now they're despised because men are bad, even though men are getting crushed. If you look at all the statistics, college graduation rates, suicide rates, joblessness, women are now ascendant.

And yet the feminist thing keeps going because it's much more than just about women being ascendant or equal or unequal. It's way past that stage. But Youngstown, Ohio. You got guys that used to make a living, could put bread on the table, made a decent wage, we're proud of it. And now what's there?

Rusted out steel mills, closing churches, the old clubs, the VFWs, the Rotary, the bowling leagues, they're all dying. These guys are alienated. They're isolated. They want to believe in something. And you know what they believe in?

They believe in Trump. I'm not saying that's good or bad. I'm just saying it is. So I think you're right when you point out there's a counterpart to being woke on the right, but who has the power? Do you know anyone who got fired for criticizing Trump? Have you heard about people getting fired for criticizing BLM? Or how about the founder of, was it the CEO of Mozilla?

He gave a thousand bucks to the pro-marriage. Let me translate that into woke, anti-gay. I don't think that's necessarily what it means. He gave $1,000 to anti-gay? He gave $1,000 to the pro-marriage resolution. the pro-marriage proposition in California. Okay. Now, you can spin it as pro-marriage or anti-gay.

I guess it depends where you're coming from. Okay. Bottom line is, he gave $1,000 to that. His name got leaked on purpose. That's how these people work. They want to destroy you. He was fired from Mozilla. Google it.

CEO of Mozilla steps down. He was pushed out. Why? Because he thought the wrong way. Today, again, Google, how many people right now lose their jobs or fear for their livelihood if they say something against BLM. All right.

Now tell me how many people are afraid of losing their livelihood because they said something anti-Trump. You might find a few stories where someone said something anti-Trump and got in the trouble. It's the exception to the rule. I'll give you an example. I have a very moderate friend. We're talking a McCain-type Republican

who might have voted for Biden back before he went nuts. I mean, not just senile, but hard left. Before he turned into a cadaver? Well, both a cadaver and a leftist. It's the worst of both worlds. It's like a vampire and a zombie make, and you get the worst sort of undead possible. So this is a very moderate person who would switch parties

and try to vote for the centrists in each. This friend of mine works for a Fortune 500 company, and he won't. He doesn't like Trump. It feels the same way I do. Trump's not a nice person. He cheats on his women. He's mouthy.

He says things he shouldn't say. I don't like him. He's vulgar. But I think his policies are better than what the other side has to offer. But I would never dare give money to his campaign because I could lose my job. That's what's happening in America today. And it's almost entirely on one side. At a university, do they ban left-wing speakers?

Do you see, you get a couple of the neo-Nazi idiots like in Charlottesville marching, but by and large, who's burning stuff down? When we look at buildings burned down by rioters, what percentage are burned down by left-wingers? what percentage are burned down by right wingers. So we're slipping into something very ugly and unfortunately very normal in human history. In fact, part of when we get back on topic,

and it's fun, I like to ramble, as you can tell, lawyer, right? We're slipping into the norm. So the United States has always been exceptional. And what we're living now is the norm, and the norm isn't pretty. Don't you think that's part of the problem, though, using like labels like left winger white right winger woke people that's just you know that's all

part of the divide that just fuels the divide and and makes people feel like that's that's one team and this is my team like there's two different teams you know it just it it it it i feel like it it fuels the divide even more and not like there's enough divide and conquer going on in the country right now by politicians signaling to different people um i feel like just conversations like that all over the media just influence people more and more and more. And I don't know what it's going to take to get out of that. Let me be more specific. Labels are like any other tool, like guns. How do you use them? Labels are very useful. For example, I can't meet every human being and judge every human being on his individual merits, as much as I'd like to. And so I have a labeling system,

right? If you show up next to me at a bus stop late at night and you're 350 pounds, wearing a certain kind of jacket with a big scraggly beard, a death metal shirt, and a bunch of tats, I'm a little more nervous than if you show up and you're a five-foot-tall, petite female in professional dress. And I don't know what the label for each of those people is. The point is, is we generalize. I think we have to generalize carefully with humility,

because first of all, there's always an exception to the generalization. Always. Second, you generalize for a good reason. So I've had these, again, more woke people. You can never generalize, especially not about race or culture. That's just racist. All right, let me give you one. Most people in Mexico speak Spanish.

That's a generalization, and it's about an ethnic group. Well, it's an important one if you're going to travel there. You probably should know that. I was careful. It's not all. Are there people there who speak Nahwato, the Aztec language and not Spanish at all? There are still little groups of people who speak purely Nahua. them. And I'm sure there are some other Mexicans who are naturalized that don't speak

Spanish. It's a generalization. It applies in general. Of course, it's when the generalization becomes nasty. Then the question becomes... Nasty, it's a hot word right now. Well, look, every culture, I'm so lucky in so many ways. Yeah. My mother is Latin, Latin, Latin. I mean, the generalizations fit her. Live for today, enjoy life, squeeze every drop of joy from life, very family-oriented, not always on time, vain about her looks, all the good and the bad generalizations about Latins. She pretty much hits it like a pinball machine. Those generalizations exist for a reason.

My father is as white Anglo-Saxon Protestant as it gets. I asked him one time, I found a joke. I told him this was when I was like a teenager. I said, Dad, I read about this joke back when you could tell jokes about ethnic groups. You can't do that anymore. it said, what's post-Coadal depression for a wasp, white Anglo-Saxon Protestant? And he says what? And I said, not being able to reach the Wall Street Journal from the bed after you're done.

He thought that was the funniest thing, because you could make fun of yourself. That's hilarious. He's very disciplined, very orderly, serious guy. So the opposite of my mother, all they have in common is chemistry and values. and otherwise they're complete opposites that over the last 50 years have become more alike. He acts like a Latin in some ways.

And so what I was taught when I was little, they told me, son, you come from two very great cultures. First of all, you're in American, first, second, and third. And thank God you were here. You won the lottery. Yeah. When you were born and where you were born. You're not a genius.

The other people in other countries aren't doing worse because you're so much better than they are. You were born here. And you didn't create this, but you should do your part to maintain it. You have a duty, and maybe even to spread it. When it comes to the cultures, your mother and I are very different, and you must choose bits and pieces.

Take the good part, like the Latin sense of joy and family. Take the good part from the Protestant English types, the discipline, the work ethic, the political and economic values. Take the best of each, ruthlessly discard the rest. So you can't do that now. That's not politically correct. If you see anything bad about a culture, unless it's white Hicks.

We're allowed to make fun of them. You say anything bad about any, oh yeah. Yeah, they're Trump supporters, which is why we're allowed to make fun of it. Oh, okay, yeah. No, seriously, you go on any show as a comedian. You go anywhere and say anything bad about white rural people. Nobody's going to have an issue that matters.

Nobody that matters is going to have an issue. Right. You go crack a joke about any other group. Yeah. There are consequences for that. That's a double standard. So when you say labeling, let me switch the word a little. I think labels are very useful if they're carefully thought through.

So let's think through our generalization with the most important thing being, is it true? Is it true? That's what matters to me. Because I can't know every person in a group, so I have to understand group traits, knowing that not everybody matches it. Is the generalization true? Second, am I balanced? See, because if all I do is make generalizations that are nasty about, a certain group. I only talk about the bad part. That makes you a racist or something similar.

That's awful. If all you do is talk about the good things about the group, you're a politically correct, Pollyanna who's part of the problem, because groups cannot fix their problems. All groups have problems, all of them. You can't fix the problem unless you identify it. You've got to be able to talk honestly about generalizations. And then what do we do about the bad ones? And how do we promote the good ones? And that applies to any group. But see, now we're not even allowed to discuss it. So I think the issue we're really getting at is tribalism.

It's, A, an inability to have an honest discussion without it becoming a religious screaming match of people who do not want to discuss facts or anything. They just want to shut you down. That's why they fire you. That's why you don't get accepted to the nice university or you get kicked out. Their object is not to have a debate with you. if you don't agree, they're shutting you down. Right.

And they have the power. The real issue, and it's one that this country is defied for so long, and the word I'd like to offer is tribalism. See, it used to be we were one big tribe, and we had our little tribes, but we were Americans. And we weren't always right. We're flawed. For example, were blacks not treated properly as Americans for a long time?

You're damn right they weren't. But you know what? We didn't invent slavery. That's existed throughout history and every civilization. We didn't invent that. At great cost, the Royal Navy and the Union Army said, we're not going to be doing this. The British, at great cost, sent their Navy forth

in the early to mid-1800s, took slavers and hung the captains. And anything within distance of the Royal Navy's cannon shot, forts on the coast that would sell slaves wherever they were, they would get a message in lead. The Union Army, those 18-year-old boys from the north, a total of 700,000 dead in the Civil War with a population less than half the size of what we got now. They didn't cause slavery. They sure has hell fought to stop it.

So no, we're not perfect. We used to unite around that. And they shamed us into uniting around that. You know, those guys, both the blacks and the civil rights marchers in the South, God, what dignity. They would show up in suits quietly. with dignity. And people would sick dogs on them.

People would hose them. And they shamed us. They kept coming. And they shamed us into doing the right thing. Yeah, yeah, done late. Sure. But we did do it. The civilization became better.

And we advanced. But now what's happening? Because that could have been a uniting moment. We've decided we're going to have separate tribes. And we can discuss some of that's natural. Look at Yugoslavia. Look at the old Russian Empire. Hell, look at Belgium or Canada.

It's normal to break down into ethnic tribes. Very normal. It's not normal to put aside skin color or religion and be one thing, an American, for example. That melting pot was fairly unique in history, and we're destroying it. Some of it's natural. Entropy is natural. All things human break down naturally. They decay.

but there are also a lot of people pushing for that. It brings them power to pit us against one another. So that now we're warring tribes and we're currently being driven further and further apart, but we're going along with it too because it's very human and it's very natural, as you said, to have a team and root for that team, right or wrong, that's my team. The problem is the team is no longer America. And so can you have an excess of a good thing? Anything in excess is bad, right?

Compassion. I want this kid to be happy. I want him to like me. I give him a bunch of candy because I'm nice. The kid's teeth fall out. Compassion can be bad. I won't discipline the kid because I don't believe ever. Violence is always wrong.

Oh, no, it's solved a few problems in history that needed solved. Hitler being a good example. Sometimes it is appropriate. Mm-hmm. we go to extremes. So let me give you something we've taken to an extreme. I lived it. I grew up.

I watched it. All the history guys can write a book and tell me I'm wrong. And I'm like, no, I lived it and watched it. And I'm going to believe my own two, a lying eyes. Diversity used to mean we got to include blacks. They weren't included. They were excluded. That was wrong.

They need to be included. It's not right. That's what it used to mean. Now it's balkanization. Now there's no longer a common identity. multiculturalism. Think about that word. Instead of culturalism, an American culture. I was taught, rightly so, I think. You're Latin. You speak Spanish. Be proud of your Latin roots. But first you're an American. Second, you're an American. Third, you're an American. Fourth,

you're a Latin. So remember it. March on the parade. Remember your language. Cherish and keep the pieces of that culture that work. But don't separate yourself. That's what we're doing. We're splitting tribes. It's a, it's another crazy thing I noticed is lately there've been a lot of marches around here and we've been going and going covering them and interviewing people on both sides. And it's like you said, there's no conversation, a few conversations going on. It's most people just screaming at each other and just like hatred. And a couple weeks ago, there was a gay pride parade. There's a huge gay pride parade every month, every year in downtown St. Petersburg, right? Like 20 minutes away from here.

And it was so much different. It was just. just like a huge group of just people like being happy and having fun and like not yelling, just playing music, goofing off. And there was absolutely none of that. When we thought there was going to be like a huge like, you know, counter attack to them, like another side, like another like conservative side of it. Yeah, you just answered the question. I was going to ask.

Who would show up? Actually, no, there is a method to the madness. There's a pattern here. So I was going to ask you, who would show up and disrupt that? What kind of people? Well, a certain kind of conservative. Right. Because, again, that's a very broad term.

For example, my gut feel, just listening to you, you probably, to the extent your political trend libertarian would be my guess. Yeah, absolutely. Gee, how did I figure that out? It didn't take long. Yeah. I have, I'm 80% of the way there. A friend of mine says, you're like a warmonger libertarian.

Like, you're, we can get into that. There are reasons. I was a libertarian in my 20s. And as I got older and read more history and got to know people, I switched more to constitutional conservative, which is 80% libertarian with guns. Right. Lots of guns. Right. So what does tolerance mean?

When a Democrat or a woke person tolerates, there's the quote marks in the air I'm making, a gay person, are they really tolerating it? No, because they agree with it. They're okay with it. tolerance means tolerating something you disagree with. So the fact that the right wingers that are against that, which I would say even on that side of the aisle is a minority of small, loud, obnoxious minority. So let me ask you this. The gay pride people were left alone. In other words, I would say they were...

It was a big party going down up and the street. People having fun, high-fiving. But the conservatives that would disagree with it tolerated it. they didn't show up. We thought it was going to be more of support, you know, more showing for support for BLM. And the other BLM marches

that we covered had a huge anti-BLM presence there. A huge Trump presence. Yeah, counter-protester. Right, exactly. Because that's a much more political thing. Let me finish the circle here. So places where liberals dominate,

the media, the universities, increasingly corporate boardrooms. Do they tolerate me disagreeing with BLM? Because tolerance is tolerating something you don't like. They don't like it when you disagree with BLM. So how would you say they are in terms of the left, in terms of tolerance? What happens at a university?

You're going to talk about what is disagreeing with BLM. Most people would say. I make a post on my Facebook page. I think that BLM is a racist, communist, left-wing organization that is not what it purports to be, which, by the way, is exactly what I think. And that's capital BLM. Small letters, BLM, do I believe in that?

Well, yeah, I believe all lives matter. And are there different issues in the black community as we break down our generalizations and see that they face different challenges than everybody else? Yeah, there are, and they do need to be discussed and looked at. But in terms of BLM capital letters, that's a bunch of hard left Marxists, not jobs.

I think most people that look at BLM, honestly, I think especially young people and like what you see in sports, it's people just wanting to be open-minded and inclusive of minorities who don't get the same sort of treatment as other people do. We can't deny the fact that a black guy getting pulled over by the cops at midnight is going to feel the same way as me, me or you getting pulled over by the cops at midnight. A lot of the people who are pro-BLM have good intentions,

which by the way they would never ever attribute to me. Because I'm a conservative, I don't have good intentions. I'm bad. I want to hurt people. I'm selfish and I'm evil. Now how am I going to have a conversation with that person if they won't even give me the benefit of the doubt? I think that the guys on the side of the left, I don't agree with them. I think what they're doing is insanely harmful.

But you know what? I do think they mean well. I do think that the people who, for example, will put the BLM thing on their phone or their face, Facebook background or whatever. I don't think they mean any harm. In fact, the opposite. I think they mean to try and help and do good just in the way you described. That, you know, there are some problems and we'd like to be a part of the solution.

But like something else you said, I think they bought a false label. What BLM purports to be, it is not. And you just got to look at their website. That's not something that someone needs me to lecture them on. If someone's curious. Right. I mean, just go to their website. They'll tell you what they stand for.

But is it their website? It's somebody's website for sure. Somebody is weaponizing it, right? Of course, in... The founders of BLM are hardcore leftists. In partisan politics, somebody is going to take by that website. I mean, think of the person who's going to, I mean, what kind of an entrepreneurial mind is it take to... Are you saying the BLM website? ...Burchase it and weaponize it and use it towards you, whatever your agenda is. This is a question. Are you saying that the BLM website, that's... says what BLM stands for. And what the BLM founders, I think there are three of them, say was put there by someone

else and isn't what they believe? No, not at all. I have no clue who started the BLM website. I have no clue who owns it. I'm just saying that the people who founded the, who purchased the BLM website and used it as a tool for something don't necessarily have the same agenda as someone else who hears the term Black Lives Matter or sees the term Black Lives Matter. I think that could be true in theory, but in fact, the BLM website is consistent with what BLM is.

It is BLM. In other words, somebody didn't hijack their website and put a message they don't agree with on there. I think they're very open about what they're about, capital B, capital L, capital M. Among other things, they're openly against the nuclear family, which is lunacy. One of the biggest problems... What's that mean? The nuclear family? Mom, dad, kids.

Oh, okay. And here's the issue. Now, before anybody gets offended, who doesn't have... that family or wasn't in it, slow down, take a quailude. That's my generation. I think yours would probably say like take a Xanax or maybe even that's obsolete, right? I'm not up to speed on all this. If you really want to harm a child, have a child out of wedlock. If you look at the statistics and I know they're exceptions and I've talked to the exceptions, but I also talked to the usually single mom who raised the exception and what she had to do to make it happen. If you

want to mess a kid up statistically. Now we're talking about a generalization. One that sociologists on the right and left, they do agree on. So that's right away catches your attention. Holy, they agree on something? Oh yeah? Yeah, you look at Brookings Institution or the Heritage Foundation. They're going to give you pretty much the same answer. They'll have different policy suggestions. But in terms of illegitimacy, being born outside of wedlock, that is awful for children. And I don't think you need a study. Outside of wedlock or outside of a mother and father who are together and have a stable relationship? There's actually a stable home.

There's actually a slope. Wedlock trumps mother and father that aren't married because it's more stable. Because there's social pressure to be stable. There's a cost for that. Financial pressure. Social pressure. If you get divorced, financial support. Yeah.

Yeah, absolutely. But you have to pay that anyway. anymore if you create a kid. Hell, in states, men are discriminated against, even if you can show with DNA you didn't create the kid, sometimes you're held responsible for it. There's some really bad law out there that's used against men, but you don't hear about it because that's not the narrative.

The narrative goes the other way. Women are oppressed. Men are never oppressed. Going back to stable families, you know, it upsets people. They get very angry about it. But study after study, after study, after study, and unfortunately we evidently need those nowadays

because we don't have common sense or can't use our own eyeballs to just pay attention. Like I, for example, one of the things I did as I coach debate and I volunteered for a Boy Scout troop to help out. You could tell immediately. I mean immediately, about 90% of the time, there were the exceptions,

but about 90% of the time, I could tell very quickly if there was no male role model and especially no married father in the house. Very quick. and I was because I was usually the guy that got sent to deal with those kids. What trait was that? How did you know, how did you?

Oh, the misbehavior. Acting out. Not because normally, and again, now I'm making generalizations. They don't apply to everybody. Normally. Who's the disciplinarian, mom or dad? Normally. Would you say there's a trend?

Depends. Oh, you're going to hedge on me, aren't you? It does depend, right? I'm not saying always. I'm saying in the majority of cases, who's the disciplinarian? The dad. In the majority of cases, who's the one that nurtures and protects the child? The mother.

Yeah, not always. There are tons of exceptions. But in general, is what we're talking. There's a balance there, especially with young men. Young men without a father. I haven't seen, let me take that back. I've seen more studies on what happens to young men without a father, and it's usually pretty bad.

versus what happens to young women without a dad. I'm going to look into that. Now I'm curious because it's a gap in my knowledge and I need to know. I want to look at the studies to see what happens. Overall, there is an actual, because they do comparisons. And again, both on left and right, Brookings puts this out too.

Nothing works better than one man and one woman married in general. Now. Of course, because of culture. Can I show you, well, can I show you the exceptions? For example, can I show you personally a gay couple I know that I'm friends with, two ladies, who have a child who's very well brought up and probably will end up okay. Yeah. But is that in general what works?

It is not. Nothing compares to that arrangement. The further you get away from that arrangement with the furthest being, typically the single mom, very little male influence. The outcomes are universally bad, the trend. Again, not universally. every case, but generally overall. They're very bad trends. But we have continued for a number of reasons to go in this direction. Here's the irony. This is where our intelligentsia, our upper middle classes, a lot of woke people, a lot of liberals, very highly educated people, are afraid to

say, do as I do. They say every lifestyle is acceptable, no judgment. But if you look at how they live, most of them are in married stable houses and they get the corresponding results I don't know how we got on the topic it comes back to oh to BLM and you know so you get into issues of what causes issues with certain groups now here's the automatic assumption if there's a disparity between for example black and white

or let's say Hispanic which I am and white like white white as opposed to my sort of mild beige The first answer is always it's racism Without any actual attempt to prove that Well there are other factors If you live in a culture That has high illegitimacy rates

And there's a lack of fathers Across racial and ethnic lines That's a problem In other words, whether you're black or brown Or white or beige or pink or whatever You get very similar results And it's uniformly bad Well now you have to look

to the extent that exists in a given community. So it gets complicated and deep, but usually by this point of the conversation, because I've done this on Facebook before, you know, there'll be 50 canclers screaming racist. They don't want a discussion. They don't want to look at what's going on.

It's complicated. It takes a lot of thinking and having an open mind. You know, I had debaters quit. I used to coach it, and they would quit because I forced them, and at the tournaments they were forced to, argue both sides. You weren't forced to agree with it, but you did have to argue it. Right. And I remember I had one. The topic was resolved, you have a duty to help your fellow man. Now, a lot of that

turns on what does duty mean? Like, it's not the same question as, is it good to help your fellow man? In fact, a libertarian would normally say you don't have a duty, because if you have a duty, you can be forced. So should I help, yes, but do I have a duty such that you can force me to to perform that duty, no, would be a usual libertarian response. Granted, libertarians like conservatives have a lot of different shades, like 50 shades of libertarian. Right. Yeah, yeah, yeah, yeah. So I had debaters quit because they refused.

I will not argue that you don't have a duty to help others. I'm saying, I'm not asking you to agree with it. I'm just asking you to open your mind and look at how someone else thinks about it and look into it deeply. Yeah, I think it's a huge problem with most people When you speak about debating or having a conversation or arguing about anything Is most people just look for things that they only look for things that are going to validate what they already believe They don't look for ways they don't look for ways to disprove what they already believe Like if I believe something's true

I'm not looking I don't personally want to look for just look for things that are going to validate what I I already believe is true. I want to look for things that are going to prove that I'm wrong. That's if you're intellectually honest, but here's what happens. First of all, it's what you're talking about, of course, confirmation bias. That's built into human nature. So it's kind of like entropy. Everything that's human crumbles, unless we actively maintain it. Confirmation bias is built into our nature. It's actually a survival trait at some point, just like paranoia is a survival trait. Think about that. If you're paranoid, you think about all these really unlikely outcomes, and you plan for them.

Right. And probably none of them are ever going to happen. But man, if one does, you're ready. Like the saber-tooth tiger comes out of the alley with a knife. And I'm ready, man. I am ready to go. I know a lot of paranoid people. So here's what I would say about both confirmation bias and paranoia.

Paranoia is a survival trait. If you have more scenarios and you've thought them all through, no matter how unlikely, you are more likely to survive. Mm-hmm. paranoia is not a happiness trait. Right? Being that way or being around people who are that way, that's rough.

Stressful. Confirmation bias. Here's the problem. We've embraced it. I lived it. Growing up, I was trained in debate, and I was trained to challenge my own thinking, and to have truly an open mind.

So if you want to have some fun, next podcast asks me to switch arguments and argue the woke case against people like me, and I'll bet you dimes to dollars, I can do it almost as persuasively with as much knowledge because I know what I'm rejecting and that's the problem most people don't.

I know what I'm rejecting. I've looked at it, I've studied and I've thought about it. And on some things they have a point. It's not like they're 100% wrong. It's like 90. But we've embraced confirmation bias because now what do they tell you in school? How do you feel?

Right. Your feelings matter. I want to validate your feelings. And if there's some way you can get a participation trophy for getting validating your feelings, the whole point is to challenge your feelings. Right, right. And we don't do that. We embrace the whole, do you feel oppressed? Well, I don't know what's in it for me.

Well, there's a check involved. Well, yeah, I feel oppressed. I feel it. I mean, come on. Yeah. A funny story, a friend of mine. walked into, he, uh, his mom is like a hardcore Trump person. And she was watching Tucker Carlson in the living room or whatever.

And me and my friend, we're both big NBA fans. Let me define. Is she, um, so when you say hardcore Trump, very general, uh, very much strong generalization there. He can't do, well, no, because it's, it's important. Yes. Yes. Is it one of these people? He can't do anything wrong. Right. It's, he has a secret plan and he's 15 chess moves ahead of everybody. And he's a genius and you just don't see it. Yes. Okay. I just have to frame the type. I know the type. Yeah, yeah.

It's basically anything you see on Fox News is true, and anything else you hear is false. He walks in, she's watching Tucker Carlson. Me and my friend, we're both huge NBA fans. And he's commentating on the first game back when they went to the Orlando bubble, and they're all kneeling, and they have the Black Lives Matter everywhere. And Tucker Carlson says,

look at the NBA, giving a big middle finger to the rest of America. And he walks in, he sees that. And he's like, mom, are you fucking kidding me? What are you, like, what are you watching? She's like, you should fuck, you should listen to Tucker. Maybe you'll learn something. He's right. And he's like, look at, look at all these NBA players giving a big middle finger to America.

This woman believes this is true. Oh, actually, I don't. She is convinced yet. I don't disagree with him. But do you think these NBA players who are 18, 19, 20, 21, the majority of them are really given a big middle finger to America? Yes. Do you think that they're thoughtfully doing that? No.

Okay. Or is Tucker making it seem like that and painting this picture? Right. So Tucker's job, let's remember why he makes as much money as he does. I like him. I generally agree with him. His job is not to dispassionately convey facts and to give you a balanced education and view of things.

Tucker's job is to piss you off and keep you coming back to watch his show. And that's all these guys. I have relatives and friends, dear friends, that match the description. I don't watch TV. I don't watch Fox. I dislike Fox less than the rest of the media.

I despise the media in general. Let's make a point. I think the press has an insanely important job. So do teachers. So I have a lot of respect for education and for freedom of speech and for publication. I have very little respect for the present professionals engaged in those professions. The teachers are a bunch 90% left-wing nut jobs.

You want to have some fun? Google Antifa and how many of them were teachers who were when they were arrested, how many of those people. Or just what they're teaching the kids in school. The press. The problem, my God, you want to talk about confirmation bias. So the press just blatantly lies. And we can talk about how they do it. They're really good at it.

They have a special technique that the rest of us lack. So they're doing a terrible job. Instead of giving us information so we can make a decision, they're trying to make the decision by controlling the information. And now that's just blatant and open. Everyone sees it too. And they do. You see the ratings of the press are, I think, even below Congress, which, wow.

That takes effort. Like, what do you have to do? So Tucker's job, why? I agree with a lot of what he says, that's not really his job to convey information. That's sort of incidental. Tucker's job is to piss off rooting for your team and to come back and watch the next game. So I guess the irony of the NBA being involved in how serious some people get about sports was just a different kind of sport with much greater consequences. And that's an issue because on either side, you cannot have a discussion with those people.

So is she going to persuade him, for example, by screaming at him? You need to watch this. You're going to learn. What's the matter with you? Yeah, I'm thinking that's probably not going to help. But our civilization has lost the ability. What would a good, thank God. Again, thank God for the parents I've got.

You know what I want for everybody? I want all this socialism. That's a mistake. I am grateful for what I have. I don't feel guilty. I didn't cause slavery or misfortune or other things. I don't feel guilty. I feel grateful that I live in this country. Yeah. That I have the parents I've got and I want others to have what I had and I try to spread that and help people. What did I have? My father is the best practitioner of Socratic method I've ever met. Bar none. I've met judges, lawyers, law professors. What's Socratic method? You ask a very broad question. You shut up and you let the other guy talk and you lead him. Let him have his say. And then ask, what do you think about this? And it may be a long conversation.

He may have to go back and look things up if he's willing to actually have that discussion. Sometimes the best ones are open and free flowing. We don't know where we're going to go. I'm going to ask this question and it may go where I think it's not going to go. You know who I respect and they don't exist much anymore and I'll tell you why? The professors that had a strong political opinion and when they, did a study and it came up with quote unquote the wrong opinion, they're like, that's the data. It's the data. Change your opinion. Not anymore. A guy just got demoted. It was at one of the Michigan

universities. He commissioned a study on police racism towards blacks. And he's a liberal. And he thought the answer was going to be racism. And the answer to the study was no, it's prevalence of crime. You're not pulled over because you're black. You're pulled over because of the prevalence of crime in areas and you match the description. Now that's not fair. If I'm a black guy who gets pulled over and I didn't do a damn thing wrong and I'm getting pulled over because of what someone else did and I'm getting lumped into that group, is that going to piss me off?

Sure. On the other hand, what do you want police protection or not? Does it mean I can't pull people over if they're black and it matches a description? Now where it gets pissy is if it's for no good reason. All right, my turn signal was on. I've had it done once or twice to me, but the cop quickly realized from my accent and demeanor. These are not the droids we're looking for.

I got pulled over for a turn signal. And I was at that time, you know, I'm slightly swarthy, had the beard, had a beat-up car. So he was kind of like, all right. And as soon as I was, though, officer, how can it be helpful? Is there any time I make a mistake or how you doing? Hearing my hands on the wheel. Instant went away, the problem. Instantly.

But it's that ability to have that. So this professor, I think it was Michigan State, one of the Michigan universities, he came up with, quote, unquote, the wrong answer on a study that was Heather McDonald. She writes for the Wall Street Journal, among others, on police issues. She was using that study to show the police aren't racist. And by the way, I don't think they are. I mean, Minneapolis. I think some are. Well, of course, some are.

And some are rapists and some are murderers and some are thieves. But to a point where that's the real root of the problems. That's the black. I mean, how many black lives in 2019 were lost due to police shootings that were unjustified? Let's narrow it down. Unarmed blacks shot by police in 2019. How many were there? About 20.

I'm off a little. Somebody can Google my number. It's going to be close. How many of them were clearly wrong? Three. I mean, this is a situation where the guy was clearly unarmed, turned his back, and it's not like he was reaching for something. or he did something that makes you react. And just clearly, yeah, you need to be tried for murder.

Now, that's awful. But in the scope of black lives lost per year, it's not the driving thing. It's not the majority reason. If black lives truly matter, why do we only focus on the ones that are very few there were unjustifiably taken by police? what happens when you pull police protection from these neighborhoods?

So this study set out to show there were some racism because that's how these university people think. They're mostly very liberal. Of course, yeah, definitely. This guy had enough honesty that when the facts came back on the study with quote-unquote the wrong answer, he published a study. He has since withdrawn the study and been demoted. So what's the message to the rest of the university world?

You better come up with the right answer. And while we're at it, you better come up. up with the right answer on hydroxychloroquine, global warming. Oh, I'm sorry, we changed it. What do we call that now? Well, climate change. That's right, because it's always changing, so it's easy. But that sends a message. You came up with the wrong answer. You lost your position. You had to withdraw the study. So how many more guys do you think that when they have a study that comes up with quote unquote the wrong answer are going to publish honest information. That's where we live today.

I mean, a huge problem, don't you think a huge problem with what's going on with the police is a lack of training? And a lack of, I mean, how often do they have to brush up on their training or? I think there are some issues with training. I shoot. And I'll tell you it was instructive to me. I always wondered how you could put 14 bullets into a guy. Let me tell you how I went with some friends to Vegas

And there was this seal Ex-Navy seal training you how to clear a house And they had a guy in there with a suit of armor That he was the terrorist and would do different things Man was that eye-opening That was eye-opening as hell We had real guns, they were glocks with a different slide So it would shoot out this little blue-powdered bullet

And the first time the guy pops out And I'm not even under nearly as much stress I got adrenaline because I'm with my buddy and I don't want to be the bitch. I want to be a little alpha. But that's not a lot of adrenaline. It's not, hey, someone's shooting at me, adrenaline. And I still put the first time, I'm thinking the whole time,

I'm visualizing, double tat, baby, chest head, chest head. I'm going to put one in the chest, one in the head. And I shoot enough. Theoretically, I could do that. This guy pops out. Bam-bababab-bab-bab-bab-bam. So then... That's the lack of training.

Yeah. But it also, let's talk about the degree of training you need. I'll give you one more example. Then we'll talk about the degree of training because there's a good example for this. So then they didn't tell us they were going to do this. They threw some surprises at us. So I come around the corner, we did this like 50 times.

We'd go and clear this house. And so I go around the corner and the guy puts his hands up, but his gun is still in it. I blew him away. I mean, I wasn't sure. So if the guy in the dark has his hand tucked away, I'm going with the cop benefit of the doubt. Now, in terms of training,

what does it take to shoot like SEAL Team 6? These are the guys that when they go on an airplane, they can instantly put a bullet in the terrorists had not hit a civilian. These guys are the most highly trained. They can do this. They're calm. They work as a team, and there are some other issues there in terms of,

they're even exploring psychedelics to see if they can get people to work more as literally just one, because that's a big part of it, that flow. So these seal guys, seal team six back in the 80s, it was rich and I always mispronounce his name. I think it was Marcinco, wrote a book on Seal Team 6. Those guys, I don't know how many there were. Let's say 100 of them. Yeah, I had a guy on the show on Seal Team 6.

Their budget for one year of training was more ammunition than the entire Marine Corps used for the same year. So it's a non-trivial proposition. I do think more training can help, but what are some of the problems that stand in the way of that? police unions. Once we decided unionize state workers, their priorities became very different. Now you're paying in California prison guards 250 grand.

Right. And they're retiring on it. And there's no money for anything else. There's no money for what I'm paying. I'm buying votes. That's what the unions are about. And the votes are all for one party. Very few unions go Republican.

You're buying these votes. These guys are making stupid money. That doesn't mean all the cops and everyone are making stupid money. But bottom line is the union causes resources. to get funneled such that you can't even afford current operations. Take a look at Chicago. Last I looked for public services, they're paying out more in pensions than they are to active people.

That's unions. What does that mean gets cut? Everything else. Now, who supports these unions? Who votes for these unions? The same people who suffer when the police are not trained well. The black community, to name one example, I can name a lot more. It's just the easiest one because BLM is the thing right now.

They vote overwhelmingly Democratic. who overwhelmingly support the unions, who overwhelmingly put money into retirement and raises and benefits, and who starve other things and money. Now, the democratic answer is, well, we just need to take more money from everybody. We could be like Europe. Well, okay, let's talk about that. Does the middle class want to pay 60% tax rates like they do in Germany and Sweden?

That's the part they don't tell you. Google, everybody on this, just you don't have to take my word for it. I'm just some schmuck, some voice you never heard. go to Google. Google different places. Google a few places you disagree with. Take a look at what is the average tax rate in Germany, Sweden, France, and see if you want to pay that. And especially, at least there, you get something.

Because of the culture, the special culture. I speak German. I lived in Germany for a while. The special culture that Germans, Nordics, the Dutch, we used to have it for various reasons. It's dying. Ditto the British. They actually get something for their money. What do you think happens if we put 60% tax rates?

If we put, I think France, we're at 28% roughly of GDP, I think, going to government. I could be off by a few points, but in that vicinity, it's in the 20s. France is like 56%. Do you really think we're going to get from our government, given the nature of our government, our culture, how things function here? You really think that, oh, yeah, we're going to get efficient services? Yeah, I don't fucking know, but I probably think no. I probably think the answer to that question is no.

No, we look more like Greece or Italy or Puerto Rico or Mexico in that regard. Good bourbon, man. Yeah, it is pretty good, huh? Want some more? Yeah, for sure. You need to get more ice? So we were chatting, you know, took a quick break here,

and we were chatting about my parents. So mom is from El Salvador. Okay. And she is five foot one inch of 100% Trump supporter. And she tells people, she's like, and she does get a little blinded at times. I think she buys a little bit into the call to personality. And we disagree on that some.

But I'll tell you what, she's lived through a dictatorship, as has my wife. My wife lived under Pinochet in Chile. My mother lived under a dictatorship in El Salvador. And they said both of them, this country is starting to act like a dictatorship. There are too many things you can't say and you can't do or else. mom, whenever someone criticizes the U.S., it depends on if it's loving criticism. Like, you can tell the difference in your life. When someone criticizes in a loving, supportive way, they're still hard.

Like, we all had that coach who he kicks your ass, but he really is trying to make you better, and you know it, and you respect them. And then you got people who criticize because they're just mean, and they're being nasty, and they don't have your best interest at heart, and you know the difference. What's the same thing? When people get all anti-American, she goes nuts. She goes, the Salvadoran Fury enters the room. I mean, you don't know how good you have it.

We should exchange you for someone who would actually work and give a chat about this country. You should see what it is you're missing. No, we are not perfect, but it is the best place ever. And this man is trying to save the place instead of turning into a goddamn socialist hillhole, she goes and you just get out of the way. when Hurricane Sylvia comes in the room. So one of the things I got from mom, several things, pride. She's one, and both of them are the type of people who they would rather die than be wrong.

And I don't mean by be wrong like admit they're wrong. I mean they would be horrified if they hurt an innocent human being. I don't know if they could live with that. They're really good people. The discipline, the intelligence, and in mom's case, the passion. for do the right thing. Always make yourself better in life. Be a better person.

No bullshit. She both were drill sergeants, but mom, man, if she thought you were slacken. Like, you've read about the tiger moms, the Asian moms. Yeah. Well, that was my mom,

but Latin. With heels. I mean, and I'm grateful for it. Yeah. Thank God for that upbringing. I've noticed the same thing with Cubans who've experienced Castro.

Yeah. Well, and that's... Hardcore Trump supporters. Because they lived it. See, you get different kinds of Latins. What people don't realize is the Latin community, I think Biden screwed up on this, sort of. He was kind of right, but he said...

Biden recently said, unlike the black community, which is what got him in trouble, unlike the black community, the Latin community has a lot of diversity. Now, even... I don't like Biden. I think he's nuts, and I don't like him, and he's gone very left in order to win.

So I detest him. But I do think that's... statement, if you look at it objectively, was true because, for example, the Mexicans who come north to the U.S., on average in general, there's that generalization, are very different than the Cubans who came here. And it shows in the cultures and the subcultures. The Mexicans tend to be working class, not a lot of education, and they come up here and work like dogs. I mean, they work. They bust their fucking asses. To the point where it hurts them, we had some Mexican friends and we're like, look, you've got to understand what the American schools are teaching your kids,

and you've got to spend some more time with your kids. No, I'm too busy, Don John, working the four jobs. Right. And so the school brought the kid up, and the kid becomes a loser because of the inferior values taught in the public school. The Cubans who came here were more the crem to the crop of Cuba. They're the ones who had the most to lose under socialism, the ones who worked hard and were having everything taken away. So what did they do? They came here and rebuilt.

They came here and did what they did there. worked hard, but in a different way. See, they both work hard. But there's a difference when you have a class of people who are used to having a business and they know how to run it. I learned that the hard way. Like my family is not business people. They're W2 professional, highly educated people. I made so many mistakes that I didn't know having a business. All the dumb stuff, man, we could get, we could have way more bourbon and talk about the immensely stupid things I've done in business. because I didn't have that background where the Cubans who came up here

they were raised on it those families that had generations a lot of them of businesses and they worked their butts off so what did they do? They lost everything, they came back up here and they did it again

except in a place where it's even more possible they had more opportunity here than they did there so with that skill set and that attitude and that mentality and the respect for education

where the guy who came from Mexico from a poor peasant family well, he was never really taught about the importance of education. And culturally, look at, for example, compare how Chinese or East Indians do compared to other minorities. They value education. I mean, to a point of, like, if you don't study, there's going to be real trouble. Physical harm. You have Asian friends who, I ask them, how come so many study like law or medicine or engineering?

Are you kidding? If I studied sociology, my parents would have my head on a pike in the front lawn. it's just a culture. They're all about, A, education, and B, it better pay off and be practical. It's not in some places that's good and in some places that's bad. It's just a difference in culture. Again, I'm lucky. I got to see two very different cultures, and so it made me a lot more observant.

I hate to use the word sensitive because it's been overdone. Just more observant when it comes to watching. So, for example, why do the Cubans who came here vote the way they do versus the Puerto who came off an island in the Caribbean, but under very different circumstances, totally different, totally opposite voting patterns. Well, there are a lot of cultural reasons for that. Interesting. Another thing I noticed is that a lot of young people around here, especially, they don't, they tend to just lean whatever way their parents do. And they tend to just basically, they don't really think that much. They just hear whatever their parents say, educated or not,

thoughtful or not, they just tend to just hear what their parents say and repeat that. And that's the direction they move. And that's what they fight for no matter what. That's human nature. I'm going to disagree with you a little. I think if their parents are left, they stay left because the school system, the television stations, Hollywood, the universities, corporations all lean left. So that bias is actually reinforced. Where I have seen a number of my, I mean, as you can imagine, most of my friends are conservative, not all, but most, because, you know, birds of a feather, same values, that kind of thing. It's pretty normal.

And I've seen a lot of them, their kids went hard left, and I asked the parents what did it? Well, they went to college, and these professors totally screwed them up. Interesting. And my response was, well, did you have the dinner table talks? And a lot of people don't. See, Americans in general are often very lazy about raising their kids and let the schools and the system do it. And I think that's a huge mistake. One of the best compliments in my life.

So I started living in Puerto Rico, part-time. My youngest daughters last year of high school. I was there part-time for the first half of the year, full-time, the second half. The first time I came home from one of the two-week sojourns, my eldest, all the kids show up, my eldest daughter says to me, and it's just so heartfelt, it really felt good. We have the best family, just after everything she'd seen at school and all. And she might disagree on a few things. She's a bit more socially liberal than I am, and I just told her, wait, and it was great. When she got her first paycheck, she now has her own career and is outworking, and she got her first paycheck. Man, was out of reality check for her.

Yeah. But she said, we had the best family. And I said, tell me, what do you mean? Well, most people don't talk to their parents and they're not taught things and they're not made to argue and think. And they ask how you're doing, but they don't really dig. My wife's really good at that. Lord, she would be a great inquisitor. And not in a mean way. It's that she's so soft and gentle and able to elicit so much. And I asked my daughter, what's the number one thing that you think resulted in us remaining close and has helped you in life and distinguishes our family that we deserve the compliment, this massive compliment you just gave me that I'm never going to forget as long as I live. Yeah. What is the one thing that made the difference?

She didn't hesitate. Dinner table. We always, we cook our own food. We don't eat out. I mean, we do eat out some, but our kids know how to cook really well. I can tell you if you got a minute, a funny story about my son and cooking and it got in trouble. We cook together. We cook from scratch. We cook all sorts of different flavors and ethnic foods and healthy stuff generally. But, you know, we like to have our fun like this bourbon. And so they're all, they're part of the process. So when we're in the kitchen chopping vegetables and making the dish, you know, if it's me and Carolina, we play a little grab ass. If the kids are there, not so much. We have a conversation.

And then at the table, it's, you know, what happened today? And you shut up and listen, which I know it was hard to believe, given how this calls going, because I'm not really doing that. But you listen, you ask questions, you let them come to their own answers, you guide them, you don't pound your fist on the table and scream. This is the, like you said, your friend's mom. That's the worst thing you can do. You earn respect, and that's earned when they're little.

If you ignore them when they're little, you're not going to have any respect when they're 13. But when I can tell the kid, and we would even tell them as we were doing things, you know, baby, we had a rule. You had to do a sport. And if you didn't pick a sport, it was boxing, and I did it with them. And so that was talks in the car, time together. And I'd say, honey, it's killing me to go to boxing today. I got a client. I'm going to be up late tonight.

You're not going to see it. But at one in the morning, I'm going to be working on a client's thing. but the clients at one in the morning and you're right now because you matter you got to tell them you can't be sanctimonious and guilt them that was not meant to guilt my child and to oh my god no it was honey i love you i would die for you you matter more than i do i enjoy this time this time is important one day this time will mean something to you and way down the road when they're teenagers and look they got to rebel some if they don't something's wrong when that happens It's so rare for me to say to one of my kids, do this, you must.

It's very rare. More commonly, if I feel very strongly about something and that they're really headed in the wrong direction, I'm going to say, have I earned the right for you to listen to my opinion? Yeah, right away. Yeah. Did I do the things as a parent where you may not agree with me? You know I love you more than I love life itself. and I don't normally insist.

I'm going to have to insist, and that's not an order. You can not do it, but you've got to at least listen, and I very strongly recommend you follow this course of action. And you can't overuse that. Like anything else in life, if you throw down too much, you dilute it. It loses its power. When I tell my kids, even in our worst moments of teenage rebellion, oh my God, those years, especially with the middle one,

he and I get along great now but Lord did we go at it and I very rarely would I say it but when I would say you know this is one of those times where I paid my dues and I earned my stripes and I deserve your respect and I really need you to listen just please sit and honest to God listen but you got to put in time you got to pay your dues

if you put them on top of a video game or in front of the TV and you ignore them guess who's going to get ignored later? It's like that old song, the cat's in the cradle. Great song, it hurts. That's a painful song to listen to because it makes you feel guilty. It talks about the guy was never there for the kids. He was always too busy.

It's an old 60s, late 60s, early 70s. I don't think I've heard it. Listen to it. Cats in the cradle. Okay. And the guy was always working and never there. And then it's changes. He wants to talk to his teenage son.

and he's like, yeah, I love to see you, Dad. But can I have the car keys, please? And then at the end of the song, he concludes with, because he's in pain, he hurts, his child's not spending time with him. And he concludes with the painful words, he turned out just like me. Yikes.

That is hard. So we really, and thank God again, my dad would actually play that song for us. So again, I'm very fortunate to have a thoughtful parent. And me being fortunate doesn't make me feel guilty and want socialism. It makes me want to have other people have a dad like I did. Dad played that song for us when we were young. And he said, you know, if you ever feel that way, I need to know because I don't want to be that guy.

I mean... How old were you when you played that for you? Seven. Seven? Wow. Oh, no. And I think about it, you know, because on the one hand, I got the wasp and the Latino manly thing, right? You don't cry in front of others.

except my wife. And when I watch Saving Private Ryan, the kids know, we're going to watch Saving Private Ryan, and Dad's going to do two things. Dad is going to cry because of what these, because that movie, have you seen it? Oh, yeah. It shows what war is. It shows what those boys and men went through. It shows you avoid it at all costs, but if you must fight, you by God, fight to win.

No half-assing that. And I also am always going to make the same thing. same joke. My kids, I know I'm not supposed to spoil the movie, but the Germans lose. So here's a true story about my son. And it's just a personal thing now. I forget the name of the brand. You know that food you get in the mail and you cook it? Like blue aprons, it better? Yeah, blue. Yeah. There's a really high end. Is it a better version of it? Oh, really? Oh, yeah. Is it your chair too high? Sorry with that. I just had to move my there. So there is a better version. It'll come to me, Sunbasket. I've never heard of Sunbasket.

Dude, I like food. I'm into food. Like if I'm going to get it in Puerto Rico? No, no, it's one of the things I miss. Like if you give me a list of shit I miss in Puerto Rico, a really good gym, whole foods, and sunbasket. So sunbatch, and I'm a foodie. My attitude is if I'm going to smoke cigars, it's going to be Cubans. Because if I'm getting lung cancer, it's going to be worth it. If I'm going to drink, it's going to be this stuff we got in front of us.

If we're going to screw up the liver and gain some calories, by God, make it worth it. Don't give me no schlitz or Budweiser. You ever had Bud Light? that's not even beer I used to my... Delicious! Oh my God. Look, if you can see through it, you shouldn't drink it.

That's my rule with beer. With beer. See, I'm not a fan of the dark beer. The craft stuff. So this... Germany screwed me up. I used to think Bud Light was beer. In fact, I only heard two funny things in Germany.

See, the best thing about it is it's like water. That's for me. When it's hot out, when you're on the beach, out here in Florida, and you drink Bud Light. Dude, you took the punchline. You took the punchline. You shock on them. You know the joke?

No, what's the joke? Did you intentionally say what you just said? No, no, no, no. What were you going to say? That's funny because you said it's like water and you mentioned a boat. So one of the funny things I heard in Germany, and you don't hear a lot of funny things in Germany. Like humor is not really their thing. That's the Brits, right?

Raise your kids on money Python and you'll screw them up just right. So in Germany, what was the one joke? There were two jokes. The one I heard that I thought was funny. How's American beer like having sex in a boat? fucking close to water. I love it. That's perfect.

All right. So a story about my son and then you tell me where you want to go. We can do taxes. We can do asset protection. We can keep talking just stuff. Whatever floats your boat. My son. I like that,

by the way, I like these stories about raising your kid because I have a 12-month-old right now. So I'm absorbing it all. Okay. Remind me about the tyranny of the dead. The tyranny of the dead. The tyranny of the dead.

Okay. The tyranny of the dead. It's very important when it comes to raising children. So we get these sunbasket meals. And even by my foodie standards, they're pretty good. I'm talking organic, free range, so very good ingredients, fresh, but also good recipes. Like the woman would insist, for example, no, this is how you sear the chicken. And yeah, it's going to smoke and burn and scream and for a minute.

And the instructions for how to do it. And so, for example, to get what they call the Malliard reaction, that chemical reaction that seers meat that tastes. so good on the outside of the meat. These meals are just great. And I get nothing for promoting them. I mean, if I don't know, I was going to mention them, I would put a link on my website so I could get something out of this. So when we left for Puerto Rico,

we were still getting those at his request. And it comes out to like $12 a meal, which for that quality of food, I'm like, yeah, go for it. So you get the best of both worlds. It's delivered to the door. I don't have to go shop. The portions are precisely measured. All you have to do is chop, mix, cook.

and it comes out almost every time, just really good meals. So he has this young lady come over to the house, and he doesn't call me to pick up girls. He's got that down. How old is he? He is now 21. To give you an idea, though, again, very traditional. This is part of the tyranny of the dead.

The dead have experienced much more than you and I. They have lived their entire lives, and you and I have not. They have more experience, and experience matters all the life. lot. And so tradition is the tyranny of the dead. Tradition exists for a reason. Now, sometimes things change and you change tradition. We could talk about the role of women and why actually women were less valuable than men. Pre-industrial revolution, objectively speaking, women were less valuable than men. On a farm, you had seven daughters, you died. If you had seven sons, you had a big surplus. Why? Because it was a muscle-driven world. Same thing with warfare. But it changed.

The industrial and especially information revolutions made women equal, along with Smith and Wesson. And so their roles have changed and tradition had to be altered. But we alter tradition with humility and care. Everyone thinks they know everything. Let me tell you what, the dead people know more than we do. The tyranny of the dead is tradition. And so tradition, because you mentioned, you know, my son, how old was he? When he was two, and I would leave to go travel and speak, I always asked.

and he still remembers it. Son, I'm leaving the house. Who's the man of the house? I am dead. What do men do? We respect and care for our women. Man, he has got that down to the bone. We respect and care for women.

And that's just, and you can tell the girls, they know it. They know they got one. That he's, he's going to do okay and he's going to treat him right. Just be a man, what we thought a man should be. So back to the food story, he doesn't call me to learn how to pick up women, which is good because I was never really that good at it. I did it right once and it worked. So he's great at that. Between manners, not being a little bitch boy like so many boys are nowadays, not being buried in his little video game console like so many of them are,

not being a little mama's boy who was brought up mostly by the mom and not by the dad and doesn't know how to act. act like a man and to treat a woman. And I'm not saying, by the way, for the ladies out there in that position, here's what I'm telling you, I'm not trying to crack on you. It is what it is if you're in that position. Just make sure there's men in those boys' lives. That's why I was in the Boy Scout troop. That's, you know, when we coach debate, when it was in the boxing thing,

we took kids shooting. They got to have both. Like, if it's a guy out there, you've got to have a woman in the life. There's stuff that women bring to the table in general that your kid, boy or girl's going to need. You got to have them around both. You've got to have balance. So J4, that's what we nickname him, because I'm John M.

Harry the third, so he's the fourth. We just call him J4. So J4. So J4, he has no trouble picking up the women. He's very good at it, better than he wants to be at times. He always calls me when he wants to let one go and be nice, because the first time he dumped a girl, he did what young men do, which is when she asked why he told her.

And I'm like, no, no, no. He was too blunt. I mean, in her case, it was eighth grade, and he flat out told her, yeah, you have a bad reputation for being loose. Well, even if that's true, that's really not how you say it, right? Women take things differently than we do. I can say that to a guy and not scar them. With women, you can send a message without being that direct. In fact, if you're too direct, at times you hurt them.

It depends on the nature of the woman. I'm generalizing a lot. But bottom line is when he broke up with someone, he did not want to hurt. hurt her any more than was necessary. It was already unpleasant. He was the one breaking up with her. So he would call me to say, how do I do this and not hurt this lady? That's why he would call. So he calls me with one of them. And he's like, I don't know what happened. What do you mean? So before we talk about how to let her down gently like a gentleman to show some compassion and some decency. And how do you word that? Because just like anything else, sometimes compassion

and decency take a little practice, especially in a context, where the person sitting across from you thinks very differently. Women and men tend to think differently. They look at things differently. So I said, all right, son, how did you get into this? Tell me the background. I want to know some before I can answer. Well, she came over to study.

Well, did she come over to quote-unquote study, or did she come over to actually study? No, he said it was actual studying and not studying. Okay, fair enough. I just want to know. That's part of the context. Then what happened? Well, I made one of those sunbasket meals for her.

John, you cooked for a chick without having intention? Yeah, no, no, no, God. And you cooked Sunbasket. Yeah, those are really good meals, John. So you don't do that without intention unless it's someone that's a close enough friend, she knows it's just a friend thing.

Like there are a few girlfriends he has that are such friends that there's nothing romantic. They would know that him making a meal for her is not a signal. So then it gets better because he is totally my wife's kid. Like he's the one that I have. the most like her. I said John. Now I'm thinking, oh, okay, I think I know where this went. When you cooked for that girl, did you give her, because we're very liberal about wine and the family, we're Latin's. And so you water down the wine for the kids, but they start when they're six.

You teach them. It's not this thing that's bad. It's not good. It has to be controlled. That's all. You've got to know yourself. Now, some people can't control it. We all have this thing, whatever it is, video games, wine, whatever. We all got our thing or things that we're not real good at and never will be. But we try to teach him the respect, the alcohol, enjoy it, and we would water it down. So I said, you gave her wine, and I said, let me guess. It was red wine, wasn't it? Yeah?

Because that's what my wife, she drinks red wine. Again, red wine sends its lady in the tramp. It sends a different message than white wine. There's a certain ambience that's being created without him realizing he's creating it. I said, John, did you put a... on your mother's mix from, I forget what it, like Pandora or whatever that streaming service was that she had at the time, did you put your mother's cooking mix? Because she always played the same music when she cooked. Yeah, that's what we cooked to as a family. Not everybody cooks to Frank Sinatra,

Johnny. Did you put on, because my wife insists so we don't screw up our clothing, we all have to wear a damned apron. I feel like a little sissy, but we all have to wear an apron. Did you put on an apron? Did you put on an apron? Yeah. Last but not least, your mother being very Latin, when she cooks, she moves her butt. She's dancing around and cooking and she's in the, you know, in the beat. Of course. So let me get this straight, John. You don't understand why this girl's really into you and looking at you like she wants to have your baby. You invited her to the house alone.

You served her wine. You played Sinatra. You cooked her a brilliant meal. You had on an apron and you shook your ass while you cooked that meal. Let me tell you, she's not into you after all that. She's really not into you. But that was from our tradition. That's what we do.

Yeah. And it had a great impact. you spend the time with them and you talk while you're doing something fun and they're also picky as hell about food which I'm glad for they're very picky about what they eat

not in the bad sense of it's a good thing they won't try stuff. That's totally a good thing they demand quality and they know how to cook. I do a thing similar the only thing that I do as close to that is a thing called butcher box. You ever know that? It's good meat. We got meat from them.

Yeah, it's meat all off like small independent small family farms and not high quality. Not those big factory farms that chop up all those cattle. Yeah, look, the nice thing is if you can afford it, because the factory farm meat's cheap, that's the advantage. It's cheap, yeah. You can feed a lot of people. It's actually not that much of a difference. We pay like 150 bucks a month for all of our meat,

and we get a shitload of stuff. We get ground beef. We get chicken. We get salmon. Dude, if you weigh it, there's a big difference in price. And you and I can do that. And in fairness, I mean, I didn't grow up with a silver spoon. I made what I am, both the good and the bad. Yeah. I own it all, the screw ups and the good part.

But I got Butcher box and that you're you're paying close to double. Think? Dude, go to Kroger. I don't know, man. I don't do the grocery shopping, so I don't know for sure. But we get enough to feed us for the month and it's like 150 bucks. We liked it. I mean, look, it's great high quality stuff.

Like I described the ingredients for the, I already forgot the name of whatever the hell I was I was getting. What was it, blue box, something like that? It left my head. It'll come back. I'm so ADD on stuff like that, man. It's amazing that I remember my own name. Sunbasket. So similar.

Just high quality ingredients. Because look, I want to eat. It just makes common sense to me. If you can afford it, I want to eat what we evolved to eat. And changing that, maybe it's okay. Maybe the Monsanto people are right. I don't know. Maybe they're not.

Who are the Monsanto people? They're into GMOs, big time. They're like really behind GMOs. What is Monsanto? It's a big company. If you Google it, you'll see a lot of... So I don't know if it's conspiracy theory or it's real. Here's what I think on that.

I think most conspiracy theories are bull. I mean, think about it, especially with Americans. For a conspiracy theory to work, a lot of people have to blab. Well, with normal people, much less Americans who really like to blab, the old saying is, three people can keep a secret if two are dead. I mean, stuff leaks. Yeah. So there's this idea that Monsanto

corruptly makes us all the GMOs that are really bad for us. And look, it could be true. To keep us stupid slow. I wouldn't go that far. Maybe there's some of that conspiracy. I would say it's just in order to make money. There are two sides to the story, and it's not one I've dug into terribly deeply.

On the one hand, the stuff they've done allows the world to not starve. the kind of, for example, insect-resistant cotton they've created through genetic tampering has allowed cotton to grow in places it wouldn't, or wheat or corn or whatever. And it's made food cheaper and more accessible and defied the predictions of people like Paul Erlich who bet that we were going to starve to death by now. And we haven't because of, among other things, those sorts of advancements. Now there's another side to that where people think, all right, we may have a lot of the issues we're having, like autism. because we eat that.

And for example, in Europe, they're very anti-GMO. They don't do a lot of that. And they could be right. I don't know. I think it's one of those things where you need data and time. The problem is when you get the data, if it turns out it was a bad idea, that's going to be some ugly data and a lot of lives messed up. So my personal philosophy is, granted, I can afford to pay double.

I can afford whole food prices or butcher box. I'm going to eat what I think I was evolved to eat. Right. And when people, because the things we eat evolved, but slowly, the scientists are changing it very quickly. Do we know the effects of that for certain? We don't. And humility, my God, think about it. We live right now in the time of coronavirus. We want to talk about some humility with science. There's a lot we don't know. And it's being proved to us right now. So, and then throw in the subjectivity of science like we discussed. You don't want to come up with the wrong answer. or you might get fired. Right.

And now you really kind of start to wonder how much do we know. Hey, it beats the crap out of living 100. I would rather be alive today, middle class, than be a king 150 years ago. Oh, for sure. Kid me? So we've made a lot of advances, but sometimes we think maybe it's more than it is. And I think this virus is really inducing a lot of humility. We just don't know.

And people don't want to admit that, especially the government. Right. Because what's their excuse to rule over you? Well, we know better. We're smarter than you and we're better than you morally. We're better people and we're smarter people. So we have to have an answer. I don't know is not really a good answer.

But that's where cultures are different. You know, I'll give Angela Merkel, leader Germany credit. She told the Germans and they accepted it because they're a pretty rational culture. They got their issues like, you know, invading others periodically and so on. But she told them, listen, I think the number was roughly, she said 60 to 80 percent, of you are going to get this. You know, that kind of honesty here would be refreshing. Yeah. Because it is going to happen. Slow it down for sure. I think the initial lockdown, like maybe the first month, when we had no idea what we were dealing with. Like, is this going to be a lot of dead people,

lots and lots and lots of dead people? Is it going to be like Italy or what we think came out of Wuhan? And I'd say what we think came out because you can't trust a damn thing the Chinese government says. Right. Good Lord, the Chinese government makes the Mexican government look honest and efficient. I mean, but we didn't know. It's easy to, you know, after the fact, say, oh, here's, you know. Of course. But we didn't know. So the idea was to slow it down, give us some time to react. And I think it did that at great cost. Probably past the point where we need to do that. I think we're seeing that the death rates are a lot lower. We're still not sure about some of the long term effects. But look, I still have a scar on my lungs from pneumonia. Every time I get an x-ray, if it's a new doctor, he'll be like, what's that? That's not good. I want to look at that. Let's get. closer. Like, no, no, no, no, no. Here's an old x-ray from when I was 20 and 30 and 40. That spot's been there. We think it was a pneumonia scar. So these viruses have an effect. We just don't know with this one yet. So I wouldn't underestimate it. I normally wear a mask. I think it's courteous. I think it's just common courtesy. And I know this is where people get crazy.

On both sides, the irrationality of the mask thing. And again, I think common sense, all right, Does this spread via spit? Yeah. Does the mask stop some spit? Yeah. Like these guys who argue, well, you know, if I fart through underwear, the fart molecules still reach your nose. All right. So the virus is a heat-seeking missile that goes through my mask, jumps out of the spit, and seeks you out.

Yeah. No, come on. Now, there is a point about you got to use them right, and it's got to be the right ones. but the same people who tend to be very anti-mask, you know, this is my freedom, you can't make me wear a mask. Really? Why not? Well, because they don't do any good. Why not? I think they stop some spit. For sure. Well, no, people misuse them. So if people misuse something, they shouldn't have it or use it. They shouldn't use it if they misuse it. That's right. So how about guns?

Right. How about seat belts? Yeah. Oh, but you hit those guys on guns. And don't get me wrong, I'm usually on their side. It's embarrassing. I'm a big freedom guy. 80% libertarian. Yeah. My fundamental, my primary political value is liberty. I think your default position is leave everyone else the fuck alone and mind your own fucking business. Yep. But you should also help people.

Liberty doesn't work if you have a shit culture. And that's what's happening in this country. Our culture is dying. Like, why can't you have liberty in Iraq? There's nothing racially wrong with them. They're humans. Culturally, they're not ready for it. they don't have certain prerequisites

that are culture needs. We're losing those prerequisites. And some of its inability to discuss or to do the right thing. Here's where libertarians get me going. Well, I don't believe the government should help starving people. Okay.

What do you think we should do? Well, they never say you should just let them starve because that's not going to go well and they know it. A few do. And you just kind of like, yeah, go back to the Star Trek convention. You're not needed here. Well, people will help. But then when you look at how they actually live their lives, they don't.

That's troublesome. We had a culture that used to do a lot more of that. Now, some of it is that government stepped in and does so much that people don't feel the need to do so. And that corrods the culture. I mean, all these intertwining things we're discussing. Yeah, no, yeah, there's so much. And a lot of people freak out when it comes to the masks,

they freak out. They're thinking like, oh, wow, what if people start finding you for not wearing a mask? Like it's a slippery slope. If they start making us wear a mask, you know, where's it going to go? And like I mentioned, it's the same thing with seatbelts. Yeah. Now, see, the seatbelts, I don't think are justified.

So my threshold is about, it's all about what's your threshold? At what point do I have a right to interfere with your liberty? The Democrats think they have the right to do it on anything economic immediately and take 80% of your stuff. You want to have fun, ask a Democrat. What's the limit? In other words, how much am I ink? can you take, and if you still haven't solved all the world's problems, you admit that you probably shouldn't take more of my income. Man, they will avoid that question like you wouldn't believe.

They will avoid that question. And that's my issue. You know, because there's a difference. There's ideology. So I'm a conservative constitutionalist Republican. Again, let's paraphrase that as a libertarian with a little bit more violent tendencies. Where's the limit? Politically, I can make a compromise with Democrats and say, you know, let's have universal health care, but here are the limits. for example, we're not going to pay for everything. When you're getting it from someone else, you're not entitled to have every single thing. We're going to limit it to, I don't know, 5% of GDP, 12% of tax revenue, whatever, but I want to limit. They never want to limit.

Why? Because they're utopians. We're going to do this until every child has perfect medical care. Well, let me think that'll be never, which means you've given yourself an unlimited license to power. So you can't compromise or negotiate. let's say I agree to a tax increase. I'm like, we have a deal, right? We got a deal. This is the tax.

Nope. As soon as that goes up, they'll come back with, well, we need another one. So you can't make a deal with them politically. And that's why we're in this civil war we're in, which right now is just a cold political civil war for now, because you can't compromise with them because they won't keep a deal. And it always goes in one direction.

Right? They don't want to compromise on how much do we cut taxes. The only way you cut taxes is without them, doing it. You have enough of a majority that they're not involved. But when it's time to raise taxes, well, I mean, it's the classic real estate negotiating, right? I think we should raise it 30 points. Well, how about five? And then you settle on 15. You still lost. Right. That's my issue, man. Those people are never satisfied. What do you think about universal basic income? I think it's a terrible idea. Really? Yeah. Why? Because, I mean, A, philosophically, I don't think I should be

paying for your livelihood, I think we should make giving everyone money is stupid. I can see the argument for the people who truly need it, and I mean truly need it, really, really, truly need it. And I would make it uncomfortable and attach a stigma. I want it to be uncomfortable that you're taking money that was seized from others by force. Universal basic income, here's what's going to happen. You're going to have a lot of people do nothing. A lot of the deaths of despair, overdoses, suicides are people who have no purpose or meaning in their lives. And that's why they turn to Trump or woke politics or whatever. Right.

So now I pay you because work provides meaning. And there is some excellence in beauty and wonder in, I did this thing. I created this thing. I did that. And it helped someone else. There is some meaning in, yeah, I did some menial job that nobody appreciates. But you know what?

I put bread on the table for my family. I'm a good guy. I'm a good lady. I did the right thing. That has meaning. When you tell people, you don't have to work. People are going to have even less meaning than they do now. They're going to resort to video games and drugs.

They're not going to go sit down and cure cancer at home. Yeah, but I don't think you're telling people they don't have to work necessarily by doing that. I think you're in a way you're incentivizing people to, I mean, for one, stay out of jail, stay at a prison. People who have to commit crime. So in other words, don't steal because we'll do it for you. If I have more than enough money to provide for myself and my family, I want to help. I want to help people. I think it's the right thing to do. I think I feel strongly that if I can help people who necessarily can't necessarily find a way and help them provide for themselves or for their families and help keep people out of prison and help make this place a better place to be and a

better place to live in, then why wouldn't I want to do that? Well, let's be more specific. The words you use where I want to help, which I'm all for, and I believe in it. I have a blessed life and I know it and I don't feel guilty. I feel grateful and I want to help and I do help. Does that give you a right to put a gun to my head? and say, John, you'll be helping as well. And then let's say the answer is, yeah, actually, John, it does give me that right, because you're a selfish bastard, and you're not going to help enough to satisfy me in my judgment. All right, first of all, let's be clear.

Whatever you believe in, it's not freedom. That's the antithesis of freedom. I'm not saying no tax. I think the idea of all taxes being voluntary or lunacy. That's a libertarian, just fantasy that can never work. It's a threshold. Am I willing to put a gun to your head in order to raise money for a military? Because if we don't have a military and a good one, it's really, really, really, really, really bad

because the guy next door invades us and now you have no freedom. Yeah, I think it's a threshold issue. What are the things that I'm willing to force you to cooperate? And it's a short list. Because if it's not a short list, I don't believe in freedom. I believe I know better than you. I believe I am more intelligent. I believe I am more moral, which is how most professionals educated people and professors think.

I am smarter than you rubs. I'm a better person than you rubs. And I'm actually doing this for your own good. And you are too stupid and ignorant to understand, A, how intelligent and moral I am. B, that this is good for you. And therefore, you must be forced for your own good. I don't like government at all. The only reason I tolerate it philosophically is for some things you need it.

Like the example, if you don't have a military, the guy next door does, you get invaded, you're done. So you've got to have a military. But it brings dangers. Can the military be turned on its own citizenry? Yeah. So it's an imperfect world. What's the least bad answer? Well, we have a military and we try and control it and keep it firing on its own citizens

and abusing this massive power of. violence that it has. What you're proposing is to give politicians the power openly. I'm all for you can tax for the military and certain essential things. What you're saying is I want the politician to have the power to take money from one guy and give it to another if it's going to help. Well, we're already doing that, right? Yeah, and here's the problem. I'm going to tell you how this ends. I'm going to tell you how it always ends. The founders knew this. They knew this experiment would end this way. Democracy always ends in bankruptcy. Always. People vote for free stuff, except it ain't free. Eventually, they destroy the finances of the country. And that's such a tame, dry

sentence. I have to find a better way to put it. Let me tell you what happens when you inflate the currency, which is what we're doing. We're already there. We're spending more. We are spending more than we tax. If we were to tax more, that would have serious negative effects. It's not, like, guys like me, I'm not going to sit there and keep working and making what I make if you're going to go and take half of it. Why work? Right. If I'm giving the guy over here his health care for nothing, why should he work? And if I'm being taxed past a certain point, I'm going to work way less. I'm going to make just enough that I don't hit that point and then I'm going to stop. Why work? It's human nature. It's incentives. So it's one thing, and here's the trick.

Yeah, but if it levels the playing field, you're still going to work. The playing field will never be leveled, first of all. That's not human nature. Some are smarter, some are better raised, some are prior. I mean tax-wise. Wait a minute. The playing field, we are the most of the advanced industrial economies. We're competitive, right?

We're competitive by nature. If everybody across the board is taxed the same amount of money, therefore we work X amount and we earn. So are you suggesting a flat income tax? No, no, no, I'm just simply stating, you basically said that if you were taxed above a certain amount, you would stop working. Because most people would. You said why work, right? Most people would.

There are some who are competitive enough. They'll work anyway. But I think you would agree a lot of people would be like, you know, I'm making enough. Most of what I make beyond this gets taken away from me. So unless there's some separate, majorly significant meaning, my ass is on the beach. I think a very large number of people, including the people that are uniquely brilliant and able to drive innovation and so forth, would take that approach. I don't think that's hypothetical. I mean, look at the Soviet system.

And people, oh, that's so extreme. Well, no, but we look at the extremes and kind of project, where do you end up? Why work in the Soviet Union? The old joke in the Soviet Union was, is they pretend to pay us and we pretend to work. I mean, but they lived horrible, miserable, awful lives. Furthermore, when you give the government that kind of power, here's the problem. When you tell a politician, look, in order to help people, you have the power to take money from one guy and give it to another,

and you get to determine who needs. What happens every time? You get an exception one out of a hundred, the philosopher king who actually does a good job. But by and large, what's the nature of politicians? they want power right what's the old Greek philosophical I forget who said it which which one of the Greek philosophers

the guy who wants power the most should be the last one who has it by nature if you look at the people who run for office in the US by nature they want it bad because you see what they have to go through to get it I mean it's shit up to your shoulders

you're gonna want to absolutely ruin his fucking life Trump Trump's a funny he's sort of a little bit of an exception to the rule who's reverting to the mean. So I don't think Trump intended to win.

Really? I think it was a stunt because he's run before. I think it was a stunt. And what he did have, see, Trump has no morals. And Trump has no ideology at all, none, which is part of what I dislike about him intensely. He does have common sense and cunning.

And he has a sense of what people are thinking. For example, on illegal immigration, he knew it wasn't PC to say it, but he knew a lot of people, including a lot of people who said they were Democrats, were against it. Yeah, for sure. So Trump, I think Trump was surprised that Trump won. I think the morning after, he was kind of like that poodle that chased a car and fucking caught it. Now what? Yeah.

I think you're right. And now, why's he into it? Because now has egos invested. And that's the number one thing that Trump. Trump is his ego. Ain't nothing. Absolutely. Not even Melania comes before the ego, and that's saying something. Melania. So going back to universal basic income.

Now let's talk. I mean, I'm against it, first of all. I think it's going to have a very bad impact on incentives. When you tax people for working and you pay them to not work and you're doing both, you're going to have a lot less people working. Not everyone will quit, like you said, some other people are driven by other. things. But productivity and advancement. You know, my dad's alive because of something they invented 10 years ago. It's a heart procedure that has to do with lasers and sealing off arteries and it just goes

in through the artery and they don't have to cut you open anymore. Okay. That stops. Or at least get greatly slowed, greatly slowed. This prosperity we take for granted isn't. It's an historical anomaly. There are certain things that made it happen. One of them was security in your property.

What you're proposing is the opposite. Insecurity in my property. You can take it and redistribute it. I don't have any property rights unless you say I do. That doesn't, it sounds nice. It never works. Now, that's my philosophy. Okay.

What are things going to happen? Well, I think we're going to have it. Here's what's going to happen. Actually, it's happening now. Things are going to get so bad that people are going to turn to whoever promises whatever. We're there. All these checks getting handed out have to be. The problem is we pissed away our reserves on buying political popularity and both sides.

For example, one way to print money is to lower interest rates. It's an indirect form, but it is what you're doing. It's very popular because the economy booms. So instead of lowering rates during a desperate time when we needed lower rates, the Democrats and Republicans both, starting, I would say, with Clinton on. So Bush was a big part of the problem. lowered rates just for popularity and winning elections. And when it came time and we needed the reserve,

the ability now to like, hey, we need to stimulate, dropping rates now from whatever they are, I don't know, 1% to zero makes no difference. You pissed away your gunpowder, shooting in the air and having fun. And when the bad guy showed up at the door, you were out of powder. That's where we're at.

So the only solution is to print money. Now, this, leads to a lot of other segways. First of all, I think was John Maldon, a real good columnist I like and respect, wrote a piece and he made a great analogy. He says, when you pass the event horizon on a black hole, so you've got a black hole in space. The event horizon is the part where once your ship goes past, no matter how much power it has, you can't get out. It's like Niagara Falls. Once you get close enough, you're going over, buddy. We're there. Second, as interest rates approach zero. Just as light approaches a black hole, the very laws of physics and finance change.

And we're there. So what do you do? I think we're going to have a universal basic income for the same reason right now that we're doing the $600 a week and Trump said $400, now they're fighting over it. They're doing big handouts. Why are they doing these handouts to keep people from panicking? because as soon as the panic hits, that's when things get bad. That's when you get the guy on the white horse, Trump, Obama, Lenin, Hitler. That's when things get bad. People get desperate when they get afraid. Things crash.

The system stops working. A lot of people have a lot invested in the system. So they're going to print whatever amount of money they need to print in order to keep people from panicking. People have got to be able to pay their bills. If they can't pay their bills, panic ensues. And that's on both sides. Trump and the Democrats are quibbling over how much. The Democrats are like, yeah, we want people used to a universal basic income.

This is it. We're here. Trump's like, wait a minute, a lot of these people don't want to go back to work. Have you talked to small businesses, how hard it is to hire? Because people are being paid more to stay at home. Think about it. The Fed's added $600 a week to an average of about $2.50 a week to unemployment. That's $8.50 a week to sit home.

How many people don't. make that much and are happy to sit home as long as you want to pay them. So where does this go? Where does this lead to? Where do you think this go? What do you think happens next? Inflation. We'll have deflation than inflation. They'll do anything to avoid deflation. That's the Great Depression. That's really bad. What does inflation do? Allows everyone to pay their debts off nice and cheap, including the government. So you've got to put yourself in the position of the government so that when they do the thing to protect their position, they're protecting your position. The problem is that position is

contrary to common sense. Here's what I mean. let's say for one day the government makes a law. It's going to be like the purge, but a little lighter. They make a law for a day that anyone who has gold that you can find has to sell you the gold at 30 bucks an ounce. What do you do? Let's say you've got no gold. What do you do?

You're going to go buy as much gold as you can, aren't you? Because the price is artificially low. We agree? Right. Money is artificially cheap. I see it. My parents played by the rules their whole lives, saved X amount of money, and that they don't have an income because interest rates are artificially cheap.

You can't invest in bonds and have a nice steady income now at market rates. What's a market? People use that term so wrongly. You know, all the market is, you and I making a deal free. You have free volition. There are two ways to make a deal. There are two ways to have commerce. Either we both agree or one of us forces the other.

So if we agreed on interest rates, I can tell you, they wouldn't be a freaking 1% or whatever they're at. That's artificial manipulation. So they've made money artificially cheap. It's kind of like what the Soviets did. The Soviets were dumber about it. Think this through. Here's how the Soviet Union worked.

It's really similar. We'll have committee lots of men with guns. You do as told. We say tomatoes cost this much. Experts say onions cost that much. Let us cost this much. Put price on everything. That's a good accent.

Oh, yes, my Russian friends are horrifying. The ones who came over are horrified. I've had this conversation. They are horrified, the ones who came from Russia because they're like, you idiots are doing what we did. This does not work. So what did we do? We're more efficient. We're like, well, shit, pricing everything, that didn't work, takes a lot of effort, seems inefficient.

We'll just price money which buys everything. So for political purposes, both parties have driven interest rates to the United States. zero, which is a huge distortion. It changes your incentives. You don't have an incentive to save cash. It doesn't produce an income, which makes huge opportunities, by the way, for real estate investors now because everyone's chasing return. That's why preftives have become so popular. I predicted this years ago just privately with friends, because it's not like I'm a known person who predicts things and the public listens. But just with friends, I'm like, you watch, there's going to be way more preftives and way less profit sharing. In other words, instead of your 50-50 deal,

you're going to see a lot more I'm giving you a 10% preferred dividend. It's not even going to be a loan. We're not giving you that kind of security. And if you look at a lot of the offerings out there, it's come to be. Why? There's a chase for return. Why? Because interest rates are artificially low.

There's no return there. So people go elsewhere to seek return. What's the problem? They're forced to take more risk to get those returns. What's the problem? My parents are 70. They can't afford to take a lot of risk. They can't bounce back.

So they played by the rules and are being punished for it. And it changes everybody's incentives. What's my incentive? Money is artificially cheap. I want as much of it as I can. Same as the gold. If gold's artificially cheap for a day, I'm going to go out and buy it at 30 bucks an ounce as much as I can.

Money is artificially cheap, subject to you finding a productive place to put it. That's the key. But it goes against common sense. If my house is free and clear, can I go bankrupt? No. Only way I can lose it is not to pay property taxes, especially in a place like Florida where you get complete homestead protection.

But now my incentive, is to borrow as much as I can. The question is how much, and you have to have some discipline. Money is artificially cheap. The people who have debt on assets are going to do well when this is all over, because we're going to have inflation. We are. And then I, there's all these theories, modern monetary theory, and it's different this time somehow. It's always this time is different. Right. This time Obama, the socialist, it's going to work. This time Biden is socialists. It's going to work. I'm sorry, you're explaining this. Like, I'm running on four cylinders, or you're running on 12 right now.

So people who have debt are going to win. How? Because, all right, I go by, let's just take easy numbers. These are not the numbers I recommend. We'll get into better numbers soon. Okay. With inflation, the amount of my debt doesn't change, the value of the collateral does. Okay. So I go borrow 100 grand.

I buy a house that today is worth 100. Okay. If there's inflation, let's say the house is worth 200,000 and two years, but it didn't actually go up in value, it's that the currency is being depreciated. It takes more currency to buy the same house. It takes double the amount of dollars to buy the same house. Why? Because we're printing them. And we're printing them in a lot of different ways. We don't call it that, but there are many different ways to create more dollars. It's very sophisticated and subtle. One example is lowering interest rates. Another example is changing reserve ratio requirements at the banks. There are a couple of

ways they do this. Do we agree to make sure before I go on? That if I print more money, it takes more money to buy something. If I print more money, does it take more money to buy something? In other words, let's say the government tomorrow doubles the amount of cash and circulation. Okay. Will that change the price of things? All of a sudden, all these people have more little green pieces of paper. Are they going to go out and buy a lot of shit?

Yeah, of course. What happens when people buy a whole bunch of stuff, supply and demand? What happened when people started buying AR-15s? A lot of them. Shotguns, dude, you can't get a shot. gun for lover money. Right. Right. Yay. Antifa. Right. Um, so there's, there's more demand. If people have more money, they're going to go buy more. It's going to drive prices up. Right. Okay. So you print enough money. I don't know how much it is, but you print enough money. The house now in dollars is 200,000.

And we've seen this, like Zimbabwe, Weimar, Germany, Argentina, here in the 70s and early 80s. have a, sorry interrupt, I have a bill. Only way to get a word in, man. You got to interrupt. I have a $100 trillion bill from Zimbabwe. That's what happens when you print money. It's worth like five bucks. That's what happens when you keep printing. Now, there's different velocities. Obviously, we're not printing at quite that rate. So you keep printing money, so the price of everything goes up. And that's part of the dissatisfaction, by the way. It's been very uneven. For example, take a look at the rate of increase in college tuition compared to anything else.

And there are reasons for that. You know what the reasons for that are? I didn't mean for this to be a good example, but it is. There's more dollars. Why do college tuitions go up? Because the government keeps subsidizing more loans and grants. If the universities, if there's a pull of money that the universities can reach

and that pull grows, will they increase their prices? Not only will they, they have. And by the way, this is the compassionate, socialist caring, non-greedy professors who will ruthlessly raise tuition if there's more money to be taken from students. These compassionate, caring, wonderful, wonderful professors, ask them, they'll tell you repeatedly how nice they are. They don't give a shit if you have $250,000 in student debt and only get paid $25,000 a year

because their degree was worthless. But that's a good example. The feds, by saying, look, there's this amount of cash available. to spend on education. We're going to create a lot of cash via loans and grants and guarantees. There's this extra cash for education. What has happened to prices in education? They've gone up. What would happen if they cut off the loans? Among other things, prices would drop. This is just another version of that. Okay. So I buy a house worth 100 today. We print money. In dollars, the house is worth 200 in, I don't know, four years.

The loan's still 100. Right. I pay off the loan. Now I got 100. The guys who have the loans end up better off when there's inflation. Okay. That makes sense. That would explain why the price of houses, specifically single-family homes right now.

I don't know about commercial real estate are, like, insane. Well, go ahead. Sorry. No, no, no, no. Go ahead. Interrupt me whenever. And everything's flying off the market instantaneously. Here's the reason for that.

Because I was surprised. I'm still selling my last few rentals that we bought during the last crash so I can have cash to buy more during the next one. Yeah. We're living. So with COVID, the number of buyers went way down. Fewer people with jobs. People are insecure.

They're not getting out. Makes sense. They're fewer buyers. But the number of sellers went down even more. As in, I don't want you in my house with your COVID shit. Take the listing off the market. So right now, what we're seeing, and again, because my clients are investors, so I hear from them. They talk to me.

So we went through and just researching and thinking and talking. It's that. It's that the number of buyers have dropped, but the number of sellers have dropped even more. And therefore, what inventory there is is moving like this. This is the time to sell. This is the time of sell for sure. Yeah, this is the time to sell because here's what's going to happen. Remember panic? at some point people are going to panic. That's why the Republicans, like when the Republicans and Democrats agree, you've got to get suspicious. Right? Then you're like, hmm. Uh-oh.

Yeah, something's wrong in the world here. Yeah. They're disagreeing on how much to hand out. They're not disagreeing on handing out. None of them. Why? Elections are coming up. Plus, it's the panic.

It's like in an avalanche. I can't predict which pebble will start the avalanche, but I know if that pebble moves, we got a problem. I don't know what will cause a panic, but I know if we have a panic, it's going to be really, really bad. It's what caused the Great Depression, right? People went in and started taking money out of the bank. They panicked. They didn't trust the banks with some reason. But the banks didn't have enough money to pay out, so they started crashing.

Then there weren't loans, and then it just keeps cascading. People do stupid things when they panic. They do stupid things when they're greedy. It's greed and fear that drive things. we'd prefer to keep them in greed mode. Keep buying. Yeah, definitely. So what do you see your big investor clients doing right now?

Cash. Cash? Yeah, it depends. Now, first of all, the clients tend to be, very few of them are polymoths, even in real estate. Are what? Polymoths. Someone who's really good at a lot of things. Thomas Jefferson was a genius in like 15 different ways.

Oh, yeah, yeah. Most real estate investors that make a lot of money that I know are mainly good at that. They got their thing. Yeah. And they can adapt some, especially as they get older and have some experience. So here's what I'm seeing. Self-storage, for those who know how to find it, is still doing well. So I'm seeing people buy that.

Airbnbs are converting to long-term. That'll come back once people start traveling, but for now they're converting over to long-term. I'm seeing a lot of people. Right now, flipping's hot. The risk is when the music stops, when the fear hits, are you stuck with inventory like, So right now flipping is hot. Why? Because there's not very many sellers. So if you've got something to sell, but you've got to get that shit off your hands, you've got to have enough of a reserve that if you get stuck with some inventory, you're still going to be okay. You can run out the inventory and ride it through. Right. As opposed to be jacked up on inventory. What else am I seeing? A lot of cash. A lot of people sitting and waiting. Really? Oh, yeah. Ultra Central.

When do you think that the crash, the bubble's going to pop? See, you don't know. That's the problem. That's like asking me, John, which pebble is going to move and when? On that slope, it's going to cause the avalanche. I can't tell you. I can tell you it's going to happen. People predict it, though.

Aren't people talking about it? Don't people have suspicions when it might happen in general? Here's what this is. This is like saying, all right, Aunt Emma, who's 92, and has lung cancer and a really bad heart. we know what's going to happen. Could you tell me the day and the hour? Exactly. No, I can just tell you what's going to happen.

And the only answer the government has is print. And if it gets bad enough, create programs to put people to work like they did in Hitler's Germany or under Franklin Roosevelt. We have that. It's called prison. Well, that's a different issue. Yeah, I don't want to get into that. So, no, I mean, we would agree on some. We grossly over-criminalize things.

Yeah. Right? Look, I'm a lawyer. This is what I do. I don't even know all the tax law. That's how complex it is, much less all the other law law. Here's what I can guarantee you. You want to read a good book.

Go look up three felonies a day. What it basically says is that you commit three felonies a day without knowing it. The law is so vast, millions of pages that you're a criminal and you don't know it. And if somebody wanted to dig enough, they could make you into a criminal. And that gets into other issues. Our justice system is screwed up. See, that's where Trump has actually done something,

which he gets no credit for from the press because they hate them. And that's where... What did you do? Some of the BLM guys loosened up on some of the laws in terms of what gets you put in prison is decriminalizing a certain amount of things. And I have to look the details up. What exactly did he decriminalize?

I don't know that off the top of my head. I know he's moving in that direction and agrees with it. Nonviolent drug offenders? I got mixed emotions on that one. Such mixed feelings. Here's my ultimate solution on drugs, but it's not when it's going to happen.

So here's my ideology that is probably not politically possible. I believe in liberty. You want to take drugs? Great. You should be able to do it. But with the liberty comes responsibility. So if you take drugs

and you become addicted, and you can't feed yourself and you starve and die in the gutter, too bad. In fact, I agree. You're a good example for everybody else to think twice because people are like, well, you know, drug addiction is a sickness. Well, yeah, it's when you give yourself. That first time was a choice.

I think there's a country where it's actually, I forget which country it is, but there's a country where it's legal to do heroin. You have to literally go to the doctor, and the doctor's like, okay, you're not... It's either the Netherlands or the Switzerland or both. You're going to die. This is really bad for you.

Are you sure you want to do this? you're going to destroy your life, you're going to destroy everyone else's life, you're going to fuck yourself up, and they talk you through it psychologically, they explained you, and they actually will give you the syringe. So here you go. It's either the Netherlands or Switzerland or both. Now, and here's where, again, the problem here at least is you can't compromise with the Democrats or the liberals or the left, especially not the woke. Because, so I say as a matter of ideology, I think, look, freedom. If you want to take heroin, take heroin. Now, if it means you die, well, that's too bad. I'm sorry.

That would never happen here. Oh. The media would show a picture of a pretty blonde white girl. So we've got to touch the right cords. Yeah. In a ditch or maybe hoaring herself out or whatever. But they would find something, an image that is unacceptable to enough people. Yeah.

And they would use that for, you know, if only she had a little help, it would only take this much. to rehabilitate her. The rehabilitation costs are a lot less than prison. Can we as a just society allow this? Yeah, except they make that same argument for everything. We already can't afford the shit they talked us into on that so-called logic. We're already going bankrupt and we want more of it. Now, I do think we grossly over-criminalize.

Our system's too complex. People don't understand the laws. It's stupid that you have to pay. I charge 500 bucks an hour. And I'm worth every freaking nickel, which we haven't discussed yet, by the way, just so you know. You're not charged me for this, are you? I'm sorry? You're not charging me for this, are you?

No. Okay. No, no, no, no. I was just more along the lines of me hoaring myself out to your listeners as a badass tax lawyer. I was like, shit, we got to wrap up. Yeah, yeah. Got to go. This is my free first session, right?

When you meet with a lawyer, you get your first meeting free. This worked well. I mean, we had to tell the Chase story of how I got here. Yeah. Why Chase Bank brought me to Tampa. Oh yeah, did we talk about that yet? No, no. It's just another fun story of life in the world.

Yeah, yeah, yeah. But, you know, talking about, we can't pay for the shit we're doing now. Now, the Democrats' simplistic answer is raise taxes. The problem is there's a consequence for doing that. There's a reason that we invent more than the rest of the world, including Europe. There's a reason that unemployment rates among youth in Spain are at like 40%. When you raise taxes to pass a certain point, it causes distortions. And bear in mind that at least in some of those countries, you'd get something for it.

I think we agree here we probably would not get quite so much as, say, the Swedes out of whatever taxes we quote-unquote invest. So we're already spending more than is healthy. The government is sucking the wind out of the economy by sucking up all the debts. That's an interesting comparison you made to the Swedes. I talked to a girl from Sweden, and she was comparing her perspective on the government there to what she sees with people here. And she's like, people here in Sweden, we love the government. There's no problem with the government here. Everyone trusts the government.

Here in the U.S.? No, in Sweden. She lives in Sweden. She's like, we trust the government. It's great here. What we see on TV, it's going on there. It looks like a fiery shit storm. And there are elements to both.

Part of the reason they trust the government, it's not that they're not corrupt in Sweden or Germany. Because Germans are kissing cousins. Like, Swedish and German are close enough. I can understand the flow of Swedish from having spoken German. I can get the gist in the flow. Yeah. Very similar cultures, especially in the northern parts of Germany.

The thing people always warn about, and there are a couple answers. Germany, the fucking roads in Germany. Everything, the gas stations are like mini Taj Mahals. No, they have a special culture. That's culture. Everything is so nice. Clean, organized. Yeah, so clean.

You can eat off the floor in a gas station in Germany on Autobahn. There's another side to that culture. So, Germany set up a government with a lot of power to help people. They were the first Social Security. Autofan Bismarck created the Social Security state that we imitated. We'll talk about our version of Social Security in a minute. So the Germans have this very efficient state that does these wonderful things like the Swedes, and everybody trusts the government. Do you think it's a coincidence that in a place where the government is highly trusted and has a lot of power, that power, could we agree was eventually abused maybe just a little bit in Germany? There was this incident they had, this period that many people are familiar with.

where government in Germany maybe wasn't so good and trusted. Right, right, right. That's the problem. You put a lot of power in government. They're eventually going to abuse it. Everyone is like, no, this time will be different. No one. Well, why hasn't that happened in Sweden?

Because they're a tiny little country. Right. They can't invade anybody. Maybe Norway. Like they did, actually. Way back when. But the Swedes have their defense budget covered by us, largely. They are very efficient.

They're not just efficient at government. like you were pointing out about the Germans. They're efficient at everything. That's just their culture. But we've seen with those cultures, there's a danger in putting too much power in the government. Well, but this time will be different. This time we'll control it, said everybody always.

I think human nature is such that when you have power and you get to spend other people's money, by and large, you're going to do bad things and it's going to attract the wrong kind of people. And I don't see any long-term acceptance. to that rule. That's the problem. So here,

we're not that efficient. They're already wasting a bunch of money. Why don't we have roads as nice? We're wealthier than Germany per capita. Google, we're wealthier than almost everybody per capita. There are these small exceptions, maybe Norway, because they have a lot of oil on top of a productive population,

maybe like Qatar because of the oil, Switzerland because, you know, well, Switzerland. Although actually the Swiss do have a very interesting system. So how do you think that would work here? Do you trust our government to not abuse the power? I think they're already doing it. I don't think giving them more power is the right answer. It's scary because you need a certain culture for freedom to work, and we're losing that culture.

and the culture in Sweden allows them to trust the government. At least you get something. I don't think we would get that here with that kind of money in the government's hands. I really don't. And even if we did, I think we're more like Germany than Sweden. What would that great big, powerful government eventually do? The liberals don't think about that. They think about, well, we're going to...

How could you not think about that? Well, here's what they think. No, they believe that they're always going to run things. Trump was that's why they hate Trump so much it was a horrible shock to them look the government has this huge power we're running it this is great

except now we're not running it they've not reacted well I've enjoyed immensely the meltdown videos the TDS I gotta say I'm a bad person but I enjoy it the TDS Trump derangement syndrome Trump derangement syndrome

yeah the people who are just kind of like the ones who so worship him. You can't talk to them. He's pretty much the deity. Yeah, yeah. Like, it's a secret master plan, and he has a super high IQ, and he's 27 chest moves ahead of everyone. Yeah, whatever. And then there's the people that... They had the picture, the mural of him with, like, Arnold Schwarzenegger's body with his head. That's who they see when they see him in real life. Oh, yeah. And then you got the guys who think Trump's Hitler. I had that, a guy, a random guy, it was in Puerto Rico, American, just from his accent. I could tell right away, we switched to English. We're talking. It's a dog walking park. You mean, a lot of people walk.

walking the dog. And right away he starts off on, you know, that fascist Trump. And I said to him, you know, if Trump means to be a fascist, he's really not very good at it. I mean, he's cutting the bureaucracy and cutting taxes and trying to have less laws and less regulation. I love that he was beefing on Twitter with the Pope. I thought that was fucking hilarious. I didn't hear about that. Oh my God. He was like, he was like talking shit about Pope Francis or something. I forget exactly what he said. And I don't see, here's the problem with Trump. But the Pope, the Pope tried him somehow.

He like said something about him. Well, the Pope's a socialist. And the Pope's like, he said something about the Pope, some funny, sly thing on Twitter. Like, I forget what it was, but it was hilarious. The Pope is not just, and this is from a Latin standpoint. So I'm going to add a little Latin flavor here. The Pope is, first of all, an adherent of what's called liberation theology. hard left wing Catholic doctrine.

My opinion of religion, such as it is, is that your faith ought to guide your morals. If you have a religion, you believe in a certain thing, and the morals, let's say the Ten Commandments or whatever you believe in. That ought to guide, for example, your political decisions, which is why one would think Catholics would be against abortion, but they're not, because their politics inform their religion. They manipulate their religion to match their politics. And that's what's happened in Latin America with the Catholics. priests who like the commie idea decided instead of let me see what the christian religion leads me to and i can tell you it's not communism or socialism right let me change the religion to match my politics that's the pope what makes it worse is in and this for latins for any latins listening they'll

they'll let you know he's in argentine so the argentines are the latin american like they think they're the best they never pay their debts right they used to be one of the richest countries in the That's a very productive country, or I should say can be. Like right around the First World War when they were exporting a ton of food, because it's just very agriculturally productive. I think right around then is when their per capita was like number six in the world income. But they went with peronism, which is sort of this weird mix between socialism and fascism, which now that I think about it, isn't hard to do because fascism and socialism are very similar.

The fascists are a little more nationalist-oriented. The socialists are more class-oriented, so we have different enemies. Oh, should we hate the foreign person or should we hate someone because they have money? But we still have to hate someone and otherwise the state has a lot of control. Once the Peronists got in in Argentina, it's never, all they do is spend and print and borrow. And the IMF keeps lending them money. You know, the pusher still is there for the crack whore and the crack horror is Argentina. And it's a shame.

It's a beautiful country, even by Latin standards. Yeah. First of all, the stake, the posse, the desserts, the food, unbelievable, unbelievable, beautiful people physically, even by Latin standards, just beautiful people. And I mean, come on, tango. But in terms of how to run things, they're a total basket case, and we're imitating them, not vice versa. And what do they do? Argentines can, oh, man, you've got to read some of the blogs. There are some blogs put out by Argentines who've lived through their constant inflation, and it comes and goes. But they had

Like inflation gets so bad there. When you get a check, you go out and buy furniture. Like you get paid at work. You go buy a whole bunch of furniture. Why? Because the furniture will still have value tomorrow. I mean, and so we get away with a lot more because we're the reserve currency. And the other reason, by the way, it's dragged out so long,

because a lot of people like Peter Schiff, who lives in Puerto Rico for the same reasons I do. Who's Peter Schiff? people who don't know. He's a gold bug. Okay. He's a guy that does podcasts, talks about politics and economics, big time gold bugs, so he's finally in heaven. Because he's been predicting inflation forever and it never happened.

Why? Everyone's doing the same thing. See, it's all relative. If you're the only guy printing, if you're Zimbabwe and you're Argentina, and your money's worth nothing, what does Zimbabweans and Argentines do? They go buy dollars. What happens when everyone's printing?

Well, all of a sudden, buying dollars doesn't make so much sense. Those guys are doing the same shit. We are. So it's a race to the bottom. And that's when you start buying the hard, tangible stuff. That's where the real estate, I mean, look at people who owned real estate in California, starting in the early 70s and where they're at.

It's the one thing you can't print more of. Yeah. Yeah. Now, the thing you've got to watch out for is, are they going to go after real estate in terms of property rights? Probably there's a limit, but they are. Look at this rent control stuff. Look, you know how I'll lay in contract. works, or they call it contract for deed down here.

Yes, yes. So I still have the title to the real estate. I sell you the real estate, but I keep the title. So I have the title, but you have all the rights. So if it goes down in value, you still owe me. If it goes up in value, you profit. You've got to pay the insurance and the taxes. So who really owns the property?

The buyer does. It's just that the title's in your name. Well, that's what the government's doing in places like San Francisco, Portland, and Seattle, and that's going to spread, right? The Democrats getting more left, more progressive, more woke. That's going to spread to everywhere, especially right now when people are desperate. All these don't pay rent initiatives. You really want to think about where you invest.

Because they are taking away your rights, but they're letting you keep the title. It's just like a land contract. Right, yeah. You still got the title. You still own it, man. You still own it for the bad shit. But you don't get any of the good stuff. That's right.

You don't get any of the upside. So talk to me about 1031 exchanges What you think's gonna happen All right so switching gears Here's here's what's proposed Here's what I think will happen Okay The Biden campaign

And the Democrats in general Are very business unfriendly Trump is whatever his flaws He's nuts but he's good nuts And that at least he likes business These laws that were passed in late 17 Were brilliant in terms of helping business The Democrats are going to repeal a lot of that

They have a lot of different proposals I have a list here I scratched out that I don't know that we have time to go through We might do another one Okay We can do another one too They have a lot of proposals

They're very anti-business So Why would I Now I know some people Let's think this through Flipping's hard Especially if you're dealing With contractors and rehabbing

There's risk It's a bitch There's a lot of work I've done it personally I'm not very good at it Takes a lot of experience and skill Yep If all of a sudden

they're taking 60% of what I make on that. Am I going to do more or less? I'm competitive. I'm going to keep doing it. Maybe you'll have a few people like that. But by and large, people are going to be like, I'm going to do enough to live okay. I'm done.

So that's the incentive effect. So what is 1031? A 1031 allows you to sell non-inventory. So it doesn't work with flips because flips are inventory. It allows you to sell a property that you've held, typically for at least a year, sometimes less, but typically a year. Typically, you rented the property out. It allows you to sell it and buy another one without paying tax.

Well, it does work for flips, doesn't it? Because if you buy something and you own it for, I don't know what the time frame is, but... 12 months in a day? If you buy the property for a million bucks, you put another million into it, and a year later you sell it for four million. you make $2 million profit, you have a six-month window to spend that $2 million on another investment.

And if you spend that $2 million into a billion that costs $4 million, for example... You're thinking of an opportunity on fund. Totally different animal. It's a 1031 exchange. No, it doesn't work with flips. So here's what... Okay, let's back up a minute.

But 1031 allows you to sell the property and not pay tax on the gain. Right. It's that simple. As long as you invest that gain into something else. As long as you invest the sales amount. So if I sold it for 4 mil, I got to invest 4 mil in something that qualifies. The profit.

And the sales price. The sales price includes the profit and your investment. Let's simplify the numbers a little. I find it confusing when both numbers are 2 mil. Let's say I put 2 mil in the property. I sell it for 3 mil. I have a profit of 1 mil. Right.

You got to invest all 3 mil and something else for 1031 to work. Okay. So I was under the impression that you only had to invest the profit, which would be the $1 million. You're thinking of Opportunities Zone funds. That's a different animal. We'll talk about that. What's it called? Opportunity what?

Opportunity Zone funds. Opportunity Zone funds. Oh, yeah. And that's a fun little thing. That's a mighty fine loophole. That's something to get into. If you can do business in an opportunity zone, and let me explain what that means,

the government created these zones, mostly economically depressed areas, but a lot of them are gentrifying. So you are seeing a fair amount of rehabbing and such going on in those areas. if you do it the right way, so there is a procedure, if you are willing to either build new and then rent, or if you are willing to buy something and put as much into the rehab

as you paid to buy it, specifically the building, there are some benefits. Let's back up a minute. Let me think of a better way to, let me ask you this. Do you want me to do 1031s or do you want me to do opportunity zones? Let's do 1031. Let's do that one. first. Okay. Then we'll come back. Wait, I want to make sure, can we Google that? Can you Google

what exactly? Because I want to make, because I've been told by one of like my close real estate investor guys that I know that you only have to invest the gain, that only the capital gains is deferred. Well, okay, then that's a different thing. See, now that you're clarifying your vocabulary. And this is what I do. I'm a lawyer. Okay. Right. So you're not at fault. Now we're clarifying terms. Okay. Gap and communication. In order to. defer the gain. Defer capital gains. Right. In order to defer the gain, in our example, $2 million in, sold for three, gain a one. Right. In order to defer the $1 million, you got to roll the entire $3 million into something else. So you're deferring the gain. You're

deferring the whole million dollar gain, but you've got to roll the whole $3 million into something else. Okay. There are other requirements, though. Okay. The reason this doesn't work with flips is part of the 1031 law says 1031's don't apply to inventory or things that are normally sold in the ordinary course of business, which is really the same as inventory. What they're saying to simplify it and put it in plain English, 1031 doesn't apply to inventory. Now, it's inventory. That's gray with real estate. It's easy with like the guy who sells those bourbon bottles. That's inventory. inventory. There's just no question. What does he do? He buys and sells bourbon bottles. How many? A lot, I hope.

Real estate, there's this idea that the real estate is a capital asset until you have enough of a pattern of buying and selling that it becomes inventory, also known as dealer property. So once you've bought and sold enough, and that's a gray number, people always ask me, John, I just want a number. And I want it now on the podcast, for free. I want your malpractice insurance to cover me if you're wrong. And I want it to be an exact number so I know exactly what to do. No, the law is not that clear. The law's gray. For example, you could do one deal and become a dealer if the dealer is big enough. Let's say you buy some land and subdivide it into 20 lots and you're like, well, that's one deal. Now IRS is like,

uh-uh. That's 20, bitch. Yeah. So you generally, for 1031 to work, The usual rule is it either has to be held for appreciation, meaning you don't really improve it. You just sit on it, which means you don't do a rehab. You don't put a building on it, et cetera. Or you rent it out for at least a year. There is this misconception that if you have property that is meant to sell and you hold it for more than a year, now you get capital gains rates if you sell, which are lower than normal rates. Or that you can 1031. That's wrong. You can never 1031 inventory.

So if you buy and sell enough, if you flip enough, that what you're doing is considered inventory, you're not going to get 1031. Let's say you do a few flips. You do two a year and you argue that's not enough of a pattern for it to be inventory, but you quickly resell it as fast as you can. You probably still don't qualify. It probably still counts as stock and trade inventory. There's a ton of case law on this. It's not completely consistent. So you read this case law and you sort of get a gut feel for what's going to fly and what's not going to fly.

And what I can tell you is if you want 1031 to work, it either better be something you don't touch and hold for at least a year. You don't rehab it or do anything. Typically land. You just sit on it and let it improve or you rent it out for at least a year. And I prefer for longer. I think a year is cutting it close. What if you buy a hotel that's a bad example? What if you buy an apartment building that's 50% full for?

a million dollars. You fill it up, paint it, and sell it for $5 million two years later. And you rented it partially. Well, it was 50%. You eventually filled it.

Now it's 95%. You can 1031 that all day long. Okay. Because here's the definition. You can 1031 a capital asset. What's a capital asset? Something that is held

so you're not just getting rid of it right away. You actually hold on to it. And there's no magical period, but I would say 18 months is a good idea. It's held for appreciation like you sit on land and you wait for it to go up. Right. You don't do anything to it. You just wait for it to go up. Maybe you do a little bit here and then and again, but if you do things to it and then immediately sell it, you weren't really holding it. So it's held for appreciation or the production of income, like rent. Okay. So that's why I like it when it's rented out. If you hold for how long,

Well, at least a year, in some cases less, but that's pretty rare. Preferably for 18 months or more, you can sell it and not pay gains. And the reason, this has been in the code since it was either 1921 or 1922. And there are always these threats to change it. None of them ever come to pass. Until now. Well, he's making the threat. And as much again, so here's what I would love to say.

Because as you can tell, I don't like the Democrats at all. I want them to lose. Do you think Biden could actually change it? Not alone, but if they get Congress, hell yeah, they can change it. And there's a decent, this is all such a wild card. It's just crazy. I mean, the smallest thing could shift everything. Who knows which idiot tweet will come out of Trump next.

Or who knows when Biden will make it so clear that even the media can't cover it up, that he's senile as hell. And he is. Yeah, he is. He's a void. They're trying to tell him not to debate Trump, because Trump's going to destroy him. I can't wait to watch that. I am so freaking psyched to watch it.

first one that I'm like, I'm like planning it. I'm like, I cannot, I'm not going to miss this. Because you got a senile guy who gets really weird when he's confronted. Yeah. He just comes up with like, what was that one, you know, a buffalo face pony soldier? Like, what? He said that? Yeah, yeah.

Somebody was challenging. It was like some construction worker said something to him on guns or taxes or whatever. Oh my God. You're a buffalo face pony soldier. And everyone's like, yeah, get him off the stage now. Get him off. Get him off. Look, here's how we beat Bernie. Biden beat Bernie as soon as Biden stopped talking.

Yeah. Bernie beat Bernie. As soon as Biden was in the basement and not allowed to talk, he sounded a lot more attractive when you listen to the nut. And it's the same strategy with Trump. But Trump's going to push it. Trump will start, I mean, he'll be like, because, I mean, this is where Trump's, Trump will say anything.

There's nothing he won't say. We know this. Once in a blue moon. And the next day, you'd be like, what? I'd say that. I didn't mean that. Oh, yeah. I didn't mean it that way. Yeah. That was yesterday. Because he makes the stuff up as he goes.

I mean, look, you can't even say he lies because lying means you knew what you said was wrong. And that means you actually thought about it. Exactly. That's the crazy thing about it all. That's the crazy thing about it. He just makes shit up. So, but here is what he does have aggressive instincts. If Biden refuses to bait, Trump is going to call him, and I mean, he won't even imply it.

Like other politicians, he will flat out say he's a gutless. coward. Do you want a gutless coward who's senile leading the country? Like Trump will actually say it. I would be surprised if he didn't say that. I mean, he would say that's

probably putting it lightly. So here's the deal. Putting it lightly. So let's talk about 1031. Because look, I think the Democrats winning would be massively negative for real estate for a number of reasons. Trump, whatever's flaws, has been very good for the economy. And people are like, yeah, but how about COVID? well yeah COVID would flatten any economy.

It doesn't matter who's in. Right. The question is whose policies are more likely to rebuild it. I think that's pretty clear. Yeah, definitely. And it's hard because you hate the guy. You're like, well, I don't really want to pay a lot of tax, and I'd like to see spending, well, he's not going to cut it,

so at least I'd like to let it be more rational. And he's good for business, so hopefully we generate enough revenue that maybe there'll be some more taxes paid. And then we got the socialists that are burning shit all over the country. That's a great choice. Anyway, 1031. The reason it's been in the code since 1920 or 1921 is taxing people when they sell property means a lot of people won't sell, which means capital gets locked up.

Economically, that's enormously inefficient. That's just, it causes economic loss. what has been good about our economy, but painful, is when one thing doesn't work, we're more flexible and willing and able to change. It's painful. The guys that voted for Trump still haven't changed. I think it's 1955.

I go to a factory. I don't have an education. I don't know shit. But I push a button, and I get paid 50 grand plus health benefits. That was an anomaly. The rest, we had,

In 1946, we had something like 67% of the world's industrial capacity because the rest of it was bombed into crap. Germany, Japan, Britain, was all in ruins. And so we used that as our starting point. This was what America should be like. We could be fat, lazy slobs and still make a shit ton of money. No, that was an anomaly. And so when everybody started catching up and rebuilding and actually having more modern factories and being hungry.

Like, have you ever seen, have you ever met a rich kid? Oh, yeah. Because he has so much given to him. He's just fucking useless. A lot of them. That was us. We had it so easy after the war,

comparatively, because we had 67% of the world's industrial economy. We got fat and sloppy and entitled. Just like, I would say Paris Helton, but it's actually a bad example because she's a brilliant marketer. Oh, yeah. She's a damn sharp marketer.

But just like those trust fund kids that are worthless. And then you got the hungry, scrappy kid. And he grew up hard. And he's like, man, I'm going to go do it. I'm going to work. I don't like this. I don't want to live like this. Well, that was Japan and Germany and everybody else.

And they caught up. So you got all these guys who were used in the 50s as they're... Who shipped all the factory jobs over to China? Because I remember Detroit used to, I mean, Detroit used to be fucking a super wealthy place and a super booming, like a... a huge city. It's a lot of things. So it's not a simple answer. Yeah. Let me give you part of the answer. Brilliant idea. Well, yes and no. Water. Because we want everything cheap. We want $800 iPhones. So let's do it all over there. Yes and no. I mean, again, who are you to tell me

where I can buy things? Do you believe in freedom? Because if you believe in freedom, I can buy from whoever I want. I can buy from China. I can buy from Thailand, whatever. There should be some exceptions. We wouldn't let you buy shit from the Sylvia Union. Why? Well, they wanted to kill us, and that was a bit of a problem, and we didn't want to enrich them. We seemed to have missed that memo with the Chinese. They're every bit as bad, if not worse. What caused jobs to go the way they were going? Remember, Detroit was artificially rich. Why was it artificially rich? Because they had all the factories, and German and Japanese factories were bombed out, and there was no competition. So you could make shit cars, overpay fat guys to do nothing. I, I

grew up in a union town. Let me tell you some of what I saw and made me very anti-American union. And then let me tell you what I saw about the unions in Germany, which are very different because I worked over there as well. American unions, I worked in a factory for, I won't say the name, I don't want a lawsuit. But I worked in a factory for my internship in law school as an industrial relations rep. It was a factory in the Midwest and it was unionized by the UAW. Those people were, it was a rural area. This was 1994. They averaged high school education, 50 grand a year, including, was that with, yeah, it was like just over 50, 50, 55 a year with benefits.

They were making a hell of a great living. And they were all big union guys, UAW. So what happens? I go in the factory and the first shift, so that goes 9 to 5, 2 o'clock they're at the table playing cards. and I'm like, that must be, something must be broken or some shit like that. And something was broken. I just thought it was a machine. That's not what was broken.

So I come in the next day, and two o'clock, they sit down and they're playing cards. And I walk up to the table because I'm the company union guys, so they know me, but they don't like me because I'm company. But I grew up in a steel town, and I understand unions, so I kind of get a sense of how to do things. So we chat, and I'm like, hey, guys, what's going on? Why are you sitting playing cards? Contract. Really, what's the contract say? Because with the union, there's going to be a 300-page contract

that says what they do and they don't do. Well, the contract says, you know, we get paid by the number of pieces produced, and once we produce that many, we stop working. Oh, I said, I understand. So you made your piece rate? Yeah. Two o'clock.

Yep. So another three hours, and you're just going to play cards. That's right. So, shit, that's like 40% of your shift or something. Yeah. You know, the problem with you guys and the reasons, this is 94 when NAFTA was just going in, so it wasn't China that we were thinking about at the time. I said to him, you know why your jobs are going to Mexico?

And boy, did I get some looks, as in you're going to get your ass kicked in the parking lot looks. Your jobs are all going to Mexico. You know, I sympathize that you guys want to make good money. Your problem is you want to make good money, and then you want to sit around with your thumb up your ass. Because I'm from Youngstown, Ohio, and let me tell you what happened. Because they were getting kind of a little bristly. You know, sticking their chest out and all that shit. Yeah.

Tough guys. Not that one of them could have caught me. Run like hell. Fat bastards would never catch me. I said, guys, I grew up in a union town. Let me tell you what happened. When it was time to negotiate the contract and decide what the peace rate would be, you worked really slow.

And anyone who worked fast to actual capacity, got his ass kicked out in the parking lot. And so the peace rate got set artificially low so that you could sit around with your thumb up your ass for three hours of your eight-hour shift. And that is why your jobs are going to Mexico. I don't mind you guys making the money you make. I think that's great.

But you ought to fucking work for it. That did not go over well. Wow. But that's the reality. And it's cultural because here's how the German unions work. In Germany, and it's changing some as they get more socialist and subsidize more people not working, their cultures changing and eroding some,

but the traditional German and Swedish, work ethic, which comes a lot from the Protestant version of Christianity that they had, it's shameful not to work. You are a bad person if you don't work, and you don't work hard and well and cooperate and make everything better for everyone. So the Germans actually require that if the company of a certain size

has union members on the board it's I forget what they call it now there's a name for it that's lost to me in German the so they got the union guys on the board they make a shit ton of money in Germany

for example if you come out of vocational school it's not like here here it's like you're a dummy you couldn't make it in the college you're a dummy which is bullshit that is just the biggest bunch of crap put out by university professors and school teachers. In Germany, if you graduate from the Real Chula, which is their version of the Vogue,

you get paid very well. Like if you're a German brickmaker, you make damn perfect bricks. And that building you build is going to last 300, 400, 500, 500 years, and you know it and you take pride in it. You get paid well for it. You have a trade and you're a craftsman.

The Germans do a damn good job with that. they also, again, they have that sense of working together, of teamwork. They don't want to sabotage their own factory. Right. So in a German factory, if someone's slacken, see here, if someone's slacken, like he's a drunkard, I had that. I had a guy who would fall on the floor and hit his head and bust it open. And when I was talking with the union rep, he would even tell me privately.

And I honored that because you lose trust if you don't keep, you know, if he says, can this be off the record? Yes, it's off the record. It has to stay off the record. He doesn't trust you rightly so. Right. He says, listen, I know the guy is a drunker, and I know he's full of shit. But my position is elective.

I want to win votes from members. So if I don't defend the shithead, I don't get voted for. So I just want you to know between us, I'm going to shout and pound the table and stomp, and I got to put on a show. It ain't nothing personal. And this is not the hill I'm going to die on, and I'm going to let you win. But there's got to be a show. He was very blunt.

old guy very, well, but he also, again, he knew because we would, you know, he's like, oh, you grew up in Youngstown. Tell me about, you know, you're, you, they have lots of UAW there and lots of steelworkers. Tell me about that. So we got the chatting. And then he showed me how to weld. And that kind of, I went in the shot, and the management didn't like that. They're like, you're getting too close to the union. And I'm like, no, I know what my job is. I'm just curious. I wanted to know how to weld. And so the union guy takes me, they were happy. They're like, oh, the college kid wants to learn how to weld. Let's teach the college kid how to do something. Yeah.

So he would tell me, you know, I know this is bullshit, but you know, the problem is the American unions defend their slackers. And if you work too hard or too fast, you're going to get an ass beating out in the parking lot. You're making everyone look bad and you're screwing up the peace ring. That's a cultural issue. In Germany, it's the opposite. If you're the guy that's fucking up the factory, yeah, the exports of Mercedes-Benz,

and that is the best engine in the car and so vote. You fuck that up? That would be a problem because we sell those for a lot of money. And we are making a lot of money on that. You and I both. So perhaps you should get back on the line and stop mitten chaise it. Totally different. Interesting.

Totally different culture. 10.31. We digress so much. But it's fun. So 1031, I'm all for it. And the reason they haven't gotten rid of it. And frankly, they won't get rid of it. Now, they got a lot of other poisonous shit that's going to be really bad for investors, bad for business.

1031 isn't going anywhere. Okay. Because they're going to have even their biased studies and their professors and their, even their versions of Paul Krugman, these economic guys who are calming as hell, are going to tell them, look, you're going to screw with allocation of capital. And something the U.S. has always been good at. It's painful. We're going through it now. Uber is replacing taxis. That's just a reallocation of capital.

So taxis have this monopoly, and they're very expensive, and they're dirty, and they smell funny. And they're regulated as hell. And Uber, with this technology, do I feel any worse about getting into an Uber than a taxi? No, I actually feel better. I think the odds of me getting herpes off the seat or less. So it's a reallocation of capital. There's less money in taxi caps, less money in taxi companies, less money in taxi medallions, and less money in taxi drivers.

We've reallocated the capital. Uber does more with less, but that's painful. It sucks if you're a taxi driver. It sucks if you're a taxi company owner. Yeah, survival of the fittest. Creative destruction. Yeah.

When you get in the way of that, when you give people disincentives to allocate capital efficiently, which is what happens when you say, we're going to tax the sale of rental real estate. You're not allowed to have other rent of real estate. you got to keep this one. That's like saying, no, you're going to have the taxis.

We're not allowing Uber. And there are places that do that, but there's a price. You know, you do it long enough. You get to the older analogy. I'm doing a more modern one, but you get to the analogy of the horse buggies. Yeah, no, that's a great analogy. I mean, that really puts it into perspective. It's not going to happen.

He's proposing it. Now, he is after real estate investors in general. I got a list of stuff and you tell me how fast or slow you want me to go because I'm pretty good at all this so you know I do a lot with self-directed IRAs Yeah, yeah, you were telling me about that Self-directed 401Ks

For example, during the crash I had to stop buying for a variety of reasons personal But I bought like 12 rentals during the crash for like, I don't know I think with rehab my average investment was like 25 grand each And those were all selling now for 65 to 80 and the rents are right around 850 to 925. So I think we would agree good deals. Yeah.

I bought almost all of those in my 401K. It was a Roth 401K. A 401K, you know, people get intimidated by self-directed IRAs and 401Ks. The rules can get complex, but if you just look at it as an LLC, it's just another kind of entity. I got... Explain for layman's terms, idiot terms for myself, what is a self-directed, IRA? What makes it self-directed? All right. So here's what, when you work at a Fortune 500 company, here's what they think

self-directed means. Which mutual fund would you like to buy? We're going to let you choose which mutual fund. They think that's self-direction. That ain't it. Okay. In a self-directed IRA with very few exceptions, you can buy almost anything. Now, there are limits on from whom you can buy and with whom you can do business. But in terms of, for example, in a 401K, you can buy rental property. You can buy apartment buildings. You can buy mobile homes. You can buy trailer parks. You can buy self-storage. You can do flips. You can buy a business. You can have it go buy a restaurant or a law practice. Some of that, most of that's tax-free. Some of it isn't. That's where we get into the complexity of the rules. The point is, you direct what the account buys. Okay. Got it. Now,

as far as I'm educated on IRAs like I mentioned before we started the podcast I read like my financial knowledge doesn't go far beyond the book I read called Money Match of the Game by Tony Robbins where he interviews all these top hedge fund guys like the guy like the owner of vanguard um more buffett for one example he says if he could do one thing only for go back and start from the beginning and only do one thing as far as investing. What's the number one thing that he would do that? It would produce the most amount of return over the longest period of time. He said it would be a invest in, I forget the term, like the SMP 500, an index fund.

Okay, one of the index funds? Over a long period of time. And he's like, that's the most upside with the least amount of downside. And a bunch of these headfunch guides all said the same thing. Well, in general, but let's bear in mind, that's not what Buffett did, and Buffett got way better results than the S&P 500. Right. So here's what Buffett's saying.

You can't do what I do. And he's probably right, by the way. Right. So here's what I ask you. And we had this conversation before coming on. When clients ask me, so we get into the self-directed IRA discussion, I have this a lot, I'll give you the example. I have a lot of besides real estate investor clients,

We get a fair number of small businesses, physicians, dentists. So the physician will say, well, what should I invest in? And my response is, what are you good at? Now, if the response is just medicine, you're probably going to have this stuff invested for you. But for example, I got a client I talked to yesterday who's really good at buying land, getting used mobile homes, putting it on pads on land, and renting it out. He's good at developing sort of mini mobile home parks, but they're small enough that they'll the zoning issues. Granted, it's in Texas where things are pretty loose to begin with.

Okay. So the first question is, what are you good at? Now, for a lot of people that I talk to... I think you're if you're like a W-2 person and you want to do something that just kind of like sits in coasts and you don't have to think about it. What are you good at? Again, I know some W-2 guys. I do private investing. I don't do as much real estate. I'm getting out of it because of some of the management issues. Plus, I'm making these contacts in Puerto Rico. some of them hedge fund managers, and you know how it is. You sit with someone long enough. There's an old saying in Latin, in vino veritas, in wine truth or in alcohol truth.

People loosen up and they talk some. So I talk to these guys I'm meeting in Puerto Rico that invest for a living, and they invest in weird stuff. What I'm investing in right now, and if it works, I'll keep putting money into it, medical receivables. So in a no-fault state like Georgia, which is where these guys invest, it's a no-fault state. What does that mean?

You get in a car accident, your insurance pays no matter what. Doesn't matter who's at fault. Your insurance pays. The way the system works is the doctor's going to, there's going to be a lawyer involved. The lawyer is going to be getting money out of the insurance company. Depending on the nature of the injury, the thing may settle quickly, the thing may take a lot of time, the thing may require litigation. What these guys are really good at, they have a doctor on staff who tells them, All right, this guy's got whiplash.

This doctor's going to do this much work. He's going to charge that much. The lawyer involved, we've tracked him. He's pretty good, so it's going to go fast. He's not going to sit on his ass. Now, if it were this lawyer, you're going to have to add eight months to the process. You're going to wait longer to get paid because he's just, he's a schmuck. Okay.

And this insurance company pays out this much. Well, here's the good thing. The average payout on these things, and it's usually, so their goal is, I want to find someone who owes a doctor money that the insurance company is going to pay. I want a minor accident that's not going to go to court. So I want something where there was some neck damage, maybe there was a chiropractor, a little bit of, you know, whiplash. I don't want it where the guy's arm went flying and it's not attached anymore.

That's getting litigated. That's going to take years. Yeah. Something where you have to know the nuances. I want something where the insurance company is going to say it's not worth fighting. It's not worth going to court. So there's small amounts. So here's what happens.

The doctor, the lawyer, and the insurance company are all involved in this process. It takes a certain amount of time to get paid. What makes this work is that the insurance companies pay on average seven times the Medicare rate. That means there's a lot of juice. That means the doctor is making a lot of money. He's charging very high rates to the insurance company, which, by the way, tells you part of what's wrong with our system. Yeah. But we can make money on it.

Right. So the doctor, younger doctors, don't have the resources of the money to wait or to fight. So they'll sell you, let's say they treat somebody for a car accident and they charge three grand. They will sell you that lien. They have a lien on the insurance company under Georgia law. They will sell you that lien for $1,500. Now, you have expertise. First of all, you know which these guys, I should say, that I've been talking to.

They know which, this is just like real estate. They know what they're doing. They know which liens to buy. And then which doctor will cooperate. They know which lawyer to cooperate with, which insurance company will pay out. And they only buy when all three are right. For example, if there's a lawyer who just doesn't follow up, takes forever, they're not going to buy that lien. Or the price drops a lot because it's going to take a lot longer to collect for the insurance company because the lawyer sits on his thumb.

etc. Or maybe there's this one insurance company that doesn't pay out well. Bottom line, these guys know what they're doing. They're buying this stuff, dirt cheap. And this will work until the mutual funds discover it. Like it used to be tax lien investing was very profitable. And then the mutual funds went in and overbid. Because when you've got 2% money, you're fine earning 4%. The rest of us liked back when it was 18%. So this will, I'm sure at some point, the institutional players will screw it up. Right. But for now, it's an angle. What am I good at?

Finding angles. Meeting people who know angles. That's why I have to say with the W-2 guy, is he good at finding angles? Is he good at talking to people? Is he from a family that are entrepreneurs and he has a sense of the private investment world? Now, if he has no sense of the private investment world,

hard money loans, flipping, factoring, small company stocks that are not listed, PPMs or private placement memorandums. If he has no sense of that world, then yeah, you're going to send him to the S&P or whatever. In which case, a self-directed IRA has no value for him. Okay. His normal IRA will allow him to invest in a mutual fund

or the S&P 500 or whatever. Okay. On the other hand, if you've got something you're good at... See, a bit of buying and flipping duplexes? See, that's valuable. Here's what I would be doing. There are two sets of rules. If you flip too much inside of an IRA or a 401K, it becomes taxable.

So they're tax-free, except when they're not. There is a tax, and people on the call can just write it down called UBIT. U-I-T stands for unrelated business income tax. Certain activity will cause your 401K or IRA to be taxable. And it doesn't mean you shouldn't do that. Sometimes it still makes sense. Ideally, you invest and hold. So here's what I would say to a guy like you.

Guy walks in, he says, I'm good at duplexes. All right, tell me about what that means. How much are you going to invest in the duplex? Give me a number. What's that run for you? Half a million, $500,000, $400,000. $500. What's the game plan?

You build the duplex, you're going to fill it up? You buy it, rent it out, sit on it for a couple years, sell it, repeat. I love that. Okay. That's a great. strategy for an IRA or 401k. So the question, so you can do this and you can do it tax-free. We'd have to look at the numbers. Okay. Because sometimes... Say every five years, every four years, five years, maybe you rinse and repeat. Does it show a loss for tax purposes? Like after depreciation,

do you show any income for those four or five years? Yeah, definitely. Oh, okay, you're still showing income. Then you're getting some really good deals. Yeah. That's hard to do in this market. So you're really good at this because I can tell you a lot of my clients would want to know how to do that. Okay. That's a good IRA, especially Roth IRA or Roth 401k investment. You can put up to 60 grand, and I'm rounding, just to keep it easy for the call. You can put up to 60 grand a year in a 401K. And there are details, because with lawyers and taxes, there's always details.

Right, right, right, right. But you can put 60 grand a year in the account. Okay. Oh, well, shit, John. That means I got to do this for eight years before I can even do anything. No. The 401K is allowed to borrow. Now, the rules say, and again, I'm generalizing, there are more subtleties. The rules say it has to be non-recourse debt.

Okay, well, the bank wants 40% down. So $500,000, $40,000 of that. So I only need to come up with $200,000, and that's going to take me about three or four years. Okay, well, that's better. How about this? I know a lot of people who want passive money. I know guys whose IRAs make a living lending. When I bought my real estate during the crash,

I was buying those houses with rehab all in at like 25 each. I had a buddy. All his IRA does, and he had like $2 or $3 million in it. All it does is lend at 10%. He liked the deal. He would lend to you at 10%. He didn't like the deal. He wouldn't lend to you.

Wow. So I showed him, here's what I'm buying these houses for. This is common, by the way. All you got to do is network some. There's a lot of those guys out there. A lot. You just got to know where to find them. Okay.

So he says that property for 25 grand that your 401k is buying, I'll finance 90% of it. And he says, and I hope you don't pay me. In other words, I bought right. He would be happy to take the house off of my hands. And that's why the down payment was so low. Because the guy knew what he was doing. He did his home home. Oh, he knew really?

He knew what the fuck he was doing. Oh, yeah. Unlike most of the banks. That's, yes. So he was willing to lend from his IRA to my 401k. So that my 401k only had to come up with a 10% down payment, which is $2,500. Wow. And I can put $60 grand in the 401k per year.

Amazing. I could have done way more, but I also had, you know, the law practice and the family. Remember the part I talked about, you know, kids and not ignoring them? Yeah. And then there's the practice. So I can only find so many. I don't regret my decisions. No, I wouldn't either.

So I bought a fair number of houses, little houses in that. We've sold almost all of them at this point. I think I have one left that I have to sell out of the 401K, and I have one that's on land contract that the guy made the mistake of falling behind, and the value, he's stupid. I got this duplex in Columbus for 23 grand, put a grand into prehab. It wasn't even rehab, you know, like make it not stink and paint it. Uh-huh, right.

Sold it to this guy on land contract for 55, like very quickly. He got five grand down. Sold it to him for 55, and the dumb son of a bitch has fallen behind on taxes and insurance. And it's worth about 100. So I have every incentive to foreclose. I'm too good of a human. I actually warned them once. I gave him one break.

I said, you're behind. I need this caught up. And I just want you to know, I will happily take this from you. You don't want to lose this. because I don't want to, I want to sleep at night. Yeah. So I'm trying to be a decent human. A lot of people wouldn't have given him the chance.

They just said, you defaulted, we got it. For sure. But I gave him the chance, and he did it again, because he's probably thinking I'm weak and stupid. And it's like, nope, I gave you the warning. So I'm going to take that. And that's going to really help my 401K. So I got that one.

It's a land contract that was paying, and he's sporadic on payments, and he's behind on both the insurance and taxes. And it's stupid, because I set the price so that the rent on the, the bottom unit was the same as his payment. He's living for free in the upper unit. The rent on the bottom unit is the same as what he's paying me and he's not paying me. Oh my goodness. Yeah. What are you going to do? So those are the last two that are left. And then I'm investing in those medical

receivables. Where are these, by the way? The houses? Yeah, Columbus, Ohio. Columbus? Okay, cool. Yeah, I think I have one outside of Columbus, one of the country towns nearby. That was a fun one. I found that one in Florida. Oh, really? Yeah, I was speaking at an Orlando group, and so I go there to speak, and somebody says to me, John, do you know of anybody who can foreclose on a land contract in Newark, Ohio, which is about 45 minutes outside of Columbus?

And I said, first, the proper pronunciation is NERC. It's like just, you know how locals always change. So I said, no, I don't, but tell me, what do you got? And he said, well, I got this land contract I bought. And I want to sell it. I want to flip it. I want to assign it. Okay.

Well, I'm curious now. Give me the address. I'm going to have a buddy of mine drive by and look at it tonight. My buddy drives by and looks at the house. And I have a sense of the value. It was on the tax assessor's rolls for 60, which is a little bit optimistic. And he says, how much do you got in it? And he's like, six grand.

Well, how much would you assign it to me for? Because it's so it's a land contract, but it's in default. It's from a hedge fund. Okay. So I send the laying contract to my lawyer, who specializes in debt, do my due diligence. I'm a lawyer, but I don't know 100% how to tell if a laying contract's enforceable. And I need it to be enforceable or it's worthless. So my lawyer looks at it.

The guy drives by. They tell me it's kosher. I asked the guy, what do you have in it? He was like $6,000. And I'm like, how much do you have to have? And I said, don't bullshit me. I don't want to negotiate. You give me a price.

If I like it, I'm going to close on the spot. I mean within a week. You give me a price I don't like. I'm not going to play the game and negotiate with you. I'm just going to walk away. And I'll buy you a beer. We're still friends. But that's, I don't have time.

My time is valuable. I'm a brute force buyer. I like your price or I don't. So he says, I'll sell it to you for, I think it was 13.5. Done. We closed. I mean, within days. We closed.

And then I only had to put, that was a prehabi type deal. And I had to put, it was only $500. to convert the land contract, because Ohio law is really good that way, convert the land contract into a deed. Oh. So I had like 15 grand in it. Now, we ended up rehabbing it again later. We put a lot more into the rehab.

So I think now I'm up to 25 grand because we couldn't sell it. It was old. It was in a rural town, not a moving market. Like, that's fine. Let's rent it. Well, for it to be rentable Section 8, you're going to have to put another 10 grand in them. I got 25 grand in it. I was pulling like $8.50 in rent.

And this was like three years ago. So during the crash, those deals were easier to find. Now that kind of deal is harder to get. Right. So you do the math. I mean, my expense ratio on that after the rehab, since we rehabbed it, there was very little expense. It's like 35% expense ratio on the rent.

So I'm doing fine. That one, we got somebody in it and it cash flows like an MFer. That's awesome. They have an option, but I'm hoping they don't exercise. So how did you get into doing all this speech? Who gets you to come out and speak? Where do you speak? So I sell a couple courses.

I do various types of teaching. The way I got into it, when the internet was young, and I was two, back in the late 90s, there was this website, CRE Online, was the 800-pound gorilla of the small investor world. I mean, they had like, probably 70% of the internet traffic at the time. But it was a very different time. I mean, dial tones, the whole nine yards. And my attitude was before I ask for something, I'm going to give something. So I worked corporate.

I had unlimited access to a database for tax legal things, which especially, again, the internet was young. There wasn't that much out there. That was a very valuable resource. And the company didn't care what I used it for. They're like, look, if you're researching tax law for any reason, we approve. That makes you a better tax lawyer for my daytime W-2 job that I had. So I started posting on this website on the theory of give before you get.

What? I wanted to invest in real estate. I saw there were a lot of really smart people on here. I wanted one of them to mentor me on real estate. And I figured if I answered questions on taxes, I would have standing to ask for things. Give before you get. So I answered questions. And people started, they're like, you know, taxation of real estate. And I was real honest. I mean, like, no, actually, I don't. I'm a corporate tax lawyer. I don't know real estate taxation, but I can learn it. and I have an unlimited database and an interest, and I'm going to invest in it. I was like 28.

So then, fast forward one year, I made a lot of badass, kick-ass posts. I mean, not just good that they were dead on and cited code sections and law, but also funny and entertaining, and I just had fun with it. It was like a hobby. So then I go to their convention,

and at the time they were the convention. It was like 500 people at a Marriott in Atlanta I'm one of the secondary speakers. So they all are like Ron LeGrand and Lou Brown, all the big shot speakers who sell a lot of stuff and make a lot of money. And I'm this little schmuck that speaks the night before, Thursday night, like when the people come in. The opening act. Yeah, yeah. And they paid like, you know, $200 to come listen to me or whatever. And so I talked, and as you can tell, I got some personality, especially for a tax lawyer. See, the nice thing is in my profession, the bar is low. Yeah. So I talked to. I talked.

them a ton of stuff in four hours. And there was a guy in the back of the room who's still out there. He's still a guru, still selling courses. His name's Bill Bronchick. We're friends. Bronchick comes up and says, you know, you ought to get on stage. You're a good speaker. And I want you on my stage in six months. So you're going to come to Colorado. I'm going to have a group of two to three hundred people. And you need to write something between now and then the sell. I'm like, okay, well, what's in it for me? You get 50% of the sales proceeds. I get the, I have venue and the audience, you have the product. We split 50-50. I'll give you the first grand for travel. Okay. But you got to write a book. I still have it. It's on my website. He wanted me to

write an entity's book, but everybody had written them because real estate investors love to talk about LLCs and C corporations and all that stuff. They're too obsessed with it. It's important. I've written a book on it. I sell the book. But they spend too much time on that and see my mentality is I want to look for something that someone's not doing. At that time, there was only one book on how to use QuickBooks to track your real estate that was sold online. And it was bad. So I read it and I'm like, hell, I can beat this. So I took two weeks off from work, which corporate man, I mean, two weeks of vacation was precious. All I did, 12 hours a day was right. And it's still the same book I have for sale today. I haven't changed the price. It's 300.

bucks. It comes with a $300 book. Yeah. Well, of course. I mean, you put some of the three-ring binder, so it sells for way more. Okay. So what happens? 300 bucks. It teaches you how to use QuickBooks to account for your books. And I wanted it because I got sick of teaching people how to do bookkeeping and going through shoe boxes to do tax returns and all that kind of crap. I hate that. So I figure I'm going to make some money selling this course. There's not a lot of competition. And it's going to save these people that I sell to a ton of money. If they do their books well, it saves so much money for the return, for the planning. If you get audited, blah, blah, blah, blah.

It's useful. So I went that first time and spoke. I made more money on that stage in 90 minutes. And I was a horrible salesman. I'm a really good speaker, but a terrible salesman. In spite of that, I still made more money in 90 minutes that I made as a month as a corporate lawyer. Wow. And so right away, I'm like, jobs gone.

You know, enough of that. And that's when I started, I did a lot with mobile homes. I used to buy and sell mobile homes when the mobile home market it was imploding. So the crash of 08 for mobile homes happened in 99. There are some companies like Green Tree, Greenpoint, Conceco, other similar companies that financed mobile homes. And for a variety of reasons, they had a meltdown. So you could go buy a mobile home for like three grand and turn around and sell it on paper. You couldn't get financing. There was no financing. The banking market for mobile homes was just dying. So you could go buy a repo for three grand and turn around and

sell it for 12 to 15 grand on a note. Really? And that's how I got started. It was cheap and easy. I learned a lot. I learned that I was very naive when dealing with low-income people who stole a lot of money from me. I learned that I was very naive with contractors. But I learned. And it gave me credibility with my clients, because now they're like, because after I quit, I also took on clients because they're like, look, you post online, you know a lot of stuff. Will you take us as a client? And this is, remember, back before CPAs and lawyers tended to specialize the way they do now for smaller investors. So I had the clients. I had a lot of credibility with the clients because I did deals,

and then it was also selling the courses. And usually one of the things was down, usually because I was screwing it up, and two of them were up. I don't invest that directly anymore. I don't have the time. I don't travel and speak anymore. Actually, I'm doing a lot of new content. Yeah, I mean, even pre-COVID, once we moved to Puerto Rico, I just was like, you know, I don't want to travel anymore. I have tons of clients. Who are in Puerto Rico? Yeah, it is nice. How are we doing on time? Good. We're at like three and a half hours. Oh, crap. We should wrap it up soon. All right. Well, here's, let's do this then. Let's let's do another one sometime. Absolutely. And we'll actually do real estate taxes and asset protection. Yeah.

Because that's really my mainstain, my focus. Small businesses, self-directed IRAs. Yeah. And the real estate. I love saving people money. Is it okay if I mention how to get a hold of me? Yeah. Tell everybody how to you. Yeah. Tell everybody how to they can find you on social media, go to your website, find your books, your courses, etc. All right. So, guys, this was an informal, as you can tell. We kind of didn't really do the topic, but it was fun.

When it comes to saving taxes, I'm very good at it. I'm very passionate about it. I do a lot of planning work for small business, real estate investors, self-directed IRAs. I also litigate something that's a lot of fun to talk about, the stuff I've seen fighting the IRS. If you're interested, if you like the style, if you're convinced I'm not completely full of shit. And then I actually, maybe not politically, but at least with taxes, know what I'm talking about. Check out IRA lawyer.com. I'm on Facebook as well. My name is John Hire, H. Y, R.E.

So funky but easily searched spelling, H-Y-R-E. And hey, take a look if you're interested. Let me tell you the upside and the downside of doing business with me. Let's be very honest. Yes. Very, very truth in advertising. I'm very good at what I do. do. I am very, very, very good at what I do. I paid my dues. I busted my ass. Wait till I tell you the stories of how I uncovered some of the stuff I uncovered. You'll be like, people do that? I paid my dues. I'm very good at what I do. That's the good news. What's the bad news? There's one of me. I don't have a lot of staff. We're starting to train people slowly. I don't like employees, but I am slowing down a

little training tax lawyers and accountants as an apprenticeship. It takes time. And I'm not real patient with people. I shouldn't say that. I'm not real patient with mediocrity. And there's a lot of it out there by definition. So there's one of me. So the good news is you get to talk to me if you hire me to do planning work or fighting the IRS or doing returns. The bad news is my schedule sucks. so where there'll be issues in terms of I don't respond as fast as you want. Yes, if it's not urgent, as defined by me. In other words, if you have a tax emergency, which here's a nice thing about what I do, tax planning work, let's say I put off an appointment by a week or two.

Does it hurt you? No. No. Most of you don't plan ahead at all. Here's when it hurts you and when I do react. I had this yesterday, actually. A guy calls and says, I just found a deal. It's in Texas.

I'm going to buy this land and put mobile homes on it. It's going to be an opportunity zone fund. I need it set up today. This guy's old school Mexican. He wants cash on Monday. I need to have the entity up and the fund up by Monday. And I was in it, I like this client, and I was in a position where we were able to get it done.

So if it's something that's truly honest to God an emergency, which is rare. Here's the emergencies typically. for real estate investors and small businesses. There's a closing. You don't want to screw up the closing. Maybe it's one of those strict ones where if you miss it, you lost the deal. And there's a tax issue.

Like there's a self-directed IRA involved or an opportunity zone fund or an installment sale or a capital gains issue and the tax issue is holding up the closing. That's an emergency. We're going to get on the phone right away. But what that means is canceling another appointment because I normally am booked out for a month ahead.

I'm good at what I do. People want to talk to me. I'm normally booked out. That means I got to call someone and say, I got to put you off. One day, I'm going to call you and say, I got to put you off because someone else, you know, had an emergency. It's fairly rare, but I will say I am a paint. There's only one of me. And so on the days that I get 150 emails, you might wait to get one back.

I'm going to scroll through and see which ones look urgent to make sure I don't miss the dumpster fire. And then come back and look at things. So I want to be honest with people and let them know. I'm very good at what I do, but because there's one of me, the prices, sometimes the communication is not as fast as you would like. And if that's going to bother you or my politics, because as you can tell, I'm very blunt about it. You don't have to agree with me, but am I going to be sensitive? Am I going to use politically correct vocabulary so as to not offend you? No.

That's not why I work for myself. So I'd love to have business, IRA Lawyer.com, John Hire, H-Y-R-E. Hopefully you were amused and learned a little. And next time around, we'll get on some tax and asset protection stuff, and you'll learn a lot and maybe still be amused. That was strong. I will include the links below as well. Cool.

Thanks for having you. Thank you.