0:00

This show is produced by the

0:03

Hartman Media Company. For more information

0:05

and links to all our great

0:07

podcasts, visit Hartman Media.com. Jason's

0:10

an incredible human. He actually, Jason's spoken at our, one of

0:12

our previous black card summits actually came out to Utah, spoke

0:14

it and just wowed the entire audience. People have still talked

0:16

to me about like, man, remember when Jason came out and

0:19

spoke there, a lot of you guys know my dad, big

0:21

time fund manager now, retired, now retired, and now retired, for

0:23

years, and years, he's been like, man, when Jason came out

0:25

and spoke there, a lot of you guys, a lot of

0:27

you guys know, and spoke there, a lot of you guys,

0:29

a lot of my dad, big time, big time, big time,

0:31

big time, big time, big time, big time, fun, fun, fun,

0:33

fun, fun, fun, fun, fun, fun, fun, fun, fun, fun, fun,

0:35

fun, fun, fun, fun, fun, fun, fun, fun, fun, fun, fun,

0:37

fun, fun, fun, fun, fun, fun, fun, fun, fun, fun, Welcome

0:41

to the Creating Wealth Show with

0:44

Jason Hartman. You're about to learn

0:46

a new slant on investing, some

0:48

exciting techniques and fresh new approaches

0:51

to the world's most historically proven

0:53

asset class that will enable you

0:56

to create more wealth and freedom

0:58

than you ever thought possible. Jason

1:00

is a genuine self-made multi-millionaire who's

1:03

actually been there and done it.

1:05

He's a successful investor, lender, developer

1:07

and entrepreneur whose own properties in

1:10

11 states. had hundreds of tenants

1:12

and been involved in thousands of

1:15

real estate transactions. This program will

1:17

help you following Jason's footsteps on

1:19

the road to your Financial Independence

1:22

Day. You really can do it.

1:24

And now, here's your host, Jason

1:27

Hartman, with the complete solution for

1:29

real estate investors. How's

1:32

your Bentley window cracked? I don't care

1:34

about that, look. How do you not

1:36

care about a Bentley? Man, I don't

1:38

care about this car, man, it's just

1:40

a car. Those of you that care

1:43

too much about cars, man, you ain't

1:45

making enough money. You're making enough money,

1:47

you won't care about material things. How

1:49

much you pay for the Bentley? Just

1:51

about a quarter million. About a quarter

1:54

million, you won't care about material things.

1:56

How much you pay for the Bentley?

1:58

This is about a $1. your

2:00

time to make money man you always gotta use

2:02

your time to make money but when you use

2:04

the bank's money to make money let's say I

2:06

could go buy an asset building let's look at

2:08

this building right here let's say I go buy

2:10

this thing here man and let's say they pay

2:13

me five million dollars or three million dollars a

2:15

year to lease it out from me and I

2:17

can go borrow the money from the bank to

2:19

buy this and I gotta pay the bank two

2:21

and a half million dollars a year out of

2:23

the three million. I just borrowed the money from

2:25

the bank and made a half a million off

2:27

borrowing the money from the bank. But people are

2:29

conditioned to think that paying off debt will make

2:31

you wealthy. That's the dumbest number. They didn't

2:33

never learn how to use debt because they

2:35

come from a scarcity family with a scarcity

2:37

mindset that thinks debt is bad. So you

2:39

know what they do the rest of their

2:42

life? They work for somebody that has debt.

2:47

Greetings Empowered Investors and

2:49

Welcome Pepsi, 2279. I am

2:51

in Santiago, Chile, and this

2:54

is a sleeper city. I

2:56

tell you, I was here many years ago,

2:58

and it is great to be

3:00

back. What a nice city. It's

3:02

just beautiful here. Now, it probably

3:04

helps the weather is perfect, but

3:06

I'm trying not to be too

3:08

terribly influenced by that. It really

3:11

is a nice city, very nice.

3:13

And I'd recommend that you come.

3:15

This is not a common tourist

3:17

destination, at least not for those

3:19

of us so far away. But

3:21

it really is nice being down

3:23

here at the other end of

3:25

the world. In a few days,

3:27

I will head over to the most

3:29

remote place on Earth, as they say.

3:32

And that is Easter Island always wanted

3:34

to go there ever since I saw

3:36

chariots of the gods as a kid.

3:39

I was fascinated by Easter Island, by

3:41

pyramids, by all of these possible ancient

3:43

technologies. Who knows? So really looking forward

3:46

to that. Now I know some of

3:48

you are probably thinking, well, isn't Antarctica

3:50

the most remote place on earth? I

3:52

don't know. That's what they say Easter Island

3:54

is. So you be the judge. But I

3:56

kind of thought the same thing when I

3:58

heard and read that. We've got many

4:01

things to cover, many things to

4:03

get into, but first I want

4:05

to just share a little personal

4:07

story with you that is a

4:09

lesson. This may not be the

4:11

biggest aha moment. I'm just going

4:13

to warn you, it's not that

4:15

profound, but it is something I

4:17

have realized in a painful. painful

4:19

way. And when I say painful,

4:21

I'm talking physically painful. Some of

4:23

you know that I injured both

4:25

of my shoulders when I charted

4:27

the yacht in Croatia last August

4:29

and had a little mastermind meeting

4:31

on that yacht. You know, doing

4:33

water sports, I was on a

4:35

raft and the raft flipped over

4:37

and it didn't hurt terribly bad

4:39

at the time, but wow, about

4:41

a week or two later, I

4:43

was in serious pain. And I

4:45

really have been in serious pain

4:47

for the last, what is that,

4:49

seven months, six months, it's pretty

4:51

darn bad. Here's the lesson. I

4:53

have not been able to work

4:56

out because of the shoulder pain.

4:58

And the lesson here applies to

5:00

real estate investing. The lesson is,

5:02

you know, I was in pretty

5:04

good shape when the accident happened.

5:06

But had I been in better

5:08

shape, I would have had more

5:10

reserves, if you will, right? Reserves

5:13

of fitness, of muscle, and now

5:15

the fact that I haven't been

5:17

able to work out, and I

5:19

guess I have valued my travel

5:21

and my excursions over getting consistent

5:24

good physical therapy, which probably would

5:26

have helped a lot. I did

5:28

have a session in Lima, Peru

5:30

last week. I've had a couple

5:32

sessions in different locations, but you

5:34

know it's probably value judgment it

5:36

would be much better being at

5:39

home in one place going to

5:41

the same physical therapist two or

5:43

three times a week I probably

5:45

would be all recovered now but

5:47

that's beside the point the point is

5:49

if you have an accident whether it

5:52

be in your investing business if you

5:54

will or whether it be in your

5:56

physical life it's better to have more

5:59

reserves it's better to have more

6:01

than you need, right? Had I

6:03

been in better shape when the

6:05

accident happened, right? Maybe it wouldn't

6:07

have been as bad because my

6:09

ligaments, my tendons would have been

6:11

stronger. Maybe that would have prevented

6:13

the injury to some extent. Or at

6:16

least, having not been able to work

6:18

out all this time, I'd be in

6:20

much better shape now and I'd feel

6:22

better if I had more reserves. So

6:25

what is the lesson there? Well, when

6:27

it comes to our financial life,

6:29

a lot of us, you know,

6:31

we're just sort of getting by,

6:34

right? We're thinking, okay, well, you

6:36

know, I'm gonna plan for my

6:38

future, I'm gonna invest in income

6:41

property, the most historically proven asset

6:43

class in the entire world. buy

6:45

a couple of houses, right? And

6:48

I'm gonna have a couple of

6:50

rental properties. But if tragedy strikes,

6:52

right, if you have that unexpected

6:54

problem in your life, if you

6:56

lose that job, if you lose

6:59

that business, if you have a

7:01

medical emergency, whatever, anything can happen,

7:03

and life is extremely delicate, it's

7:05

very tender. So we want to

7:08

have more. reserves. Now, a little

7:10

tangent to this, I have always

7:12

said, and people have asked me

7:14

over the years many times, you

7:16

know, how much cash should I

7:18

have in reserve? Well, the answer

7:21

is, and always has been, 4%

7:23

of the value of your real

7:25

estate portfolio. Are there any exceptions

7:27

to that? Maybe, sure, yeah. If

7:29

you have a giant portfolio, right,

7:31

if you have a hundred million

7:33

dollar portfolio of real estate, do

7:35

you need four million dollars set

7:37

aside? I don't know, it depends

7:39

on the type of properties and

7:41

so forth, probably not. Why? Because

7:44

the law of large numbers is working

7:46

in your favor. Think about it. Think

7:48

about the casino game roulette. I don't

7:50

gamble, well, I guess I gamble a

7:52

little bit in business and life, but

7:54

I don't gamble in Las Vegas, right?

7:56

Just doesn't interest me. But think about

7:59

the game roulette. right? You've got

8:01

red and black. And most of

8:03

the time, one of those is

8:05

going to win. And those are

8:07

just one to one odds, right?

8:10

But there's the zero and the

8:12

double zero. And just with those

8:14

two positions out of all the

8:16

other positions that are either red

8:18

or black or odd or even

8:21

on the table, right? That's how

8:23

the casino wins. It wins because

8:25

of the law of large numbers.

8:27

So the other lesson there have

8:29

a larger portfolio of investments because

8:32

the likelihood of them all going

8:34

bad at the same time is

8:36

extremely low. We all know that,

8:38

right? So if you have you

8:41

know, the old saying, right, if

8:43

you have one property and it's

8:45

vacant, you have a 100% vacancy

8:47

rate. If you have 100 properties

8:49

and only one is vacant, well,

8:52

you only have a 1% vacancy

8:54

rate, the law of large numbers.

8:56

I know that's not an exact

8:58

example. But, you know, write in

9:01

the comments below if you're watching

9:03

this on video, what your thoughts

9:05

are on that. And if you're

9:07

listening on the podcast audio only,

9:09

you can always go to JasonHarpment.com.com/ask

9:12

and Any comments and questions are

9:14

always welcome there. Okay, several things

9:16

I want to cover with you

9:18

today. Number one, rent continues to

9:21

increase with lower supply and increased

9:23

demand for 2025. Recovery continues for

9:25

the real estate market. Now, when

9:27

they say that, what does that

9:29

actually mean? Does that mean recovery

9:32

of prices, recovery of rents? Does

9:34

it mean multifamily? Does it mean

9:36

single family? Does it mean office

9:38

space, which is an absolute disaster?

9:41

We all know that, right. Recovery

9:43

from which angle. Right? If inventory

9:45

increases and there's more supply of

9:47

housing on the market, whether it

9:49

be rental or for sale housing,

9:52

and you are a buyer or

9:54

a renter, you would consider that

9:56

a recovery. You would consider that

9:58

great news. And a lot of

10:01

the housing pundits, by the way,

10:03

view it that way. They think

10:05

a recovery or a positive sign

10:07

on the market is more inventory.

10:09

And I actually agree with them.

10:12

because I just don't think it's

10:14

good for society to have an

10:16

extremely tight housing shortage the way

10:18

we do. However, if you're an

10:21

investor, now my comment there was

10:23

definitely not self-serving, because if you're

10:25

an investor and you already own

10:27

properties, you love a shortage, right?

10:29

From your angle, you think a

10:32

recovery is lower supply and a

10:34

tighter, tighter market. always depends on

10:36

your point of view, right? And

10:38

the point of view from which

10:41

the article is being written or

10:43

the story is being reported. Significant

10:45

changes from increased interest rates and

10:47

supply chain disruptions over the recent

10:49

years are still unraveling. Both commercial

10:52

and residential investors are expecting positive

10:54

trend for 2025 with multifamily rents

10:56

projected to increase by two to

10:58

two and a half percent. Now

11:01

the multifamily market. We know apartment

11:03

complexes have been in trouble lately

11:05

because they had so many deliveries

11:07

of new units. There was such

11:09

a construction backlog. But when I

11:12

say backlog, I mean, there was

11:14

a lot of construction. hitting the

11:16

market, a lot of finished units

11:18

hitting the market. And that was

11:21

a real problem. Now this didn't

11:23

happen in single family homes. There's

11:25

been pretty much an extreme shortage

11:27

all the way along, except, and

11:29

really I would say that's the

11:32

last 10 years. I was talking

11:34

to a friend about this today.

11:36

She owns a real estate software

11:38

company, and I was saying, you

11:41

know, it's always been us complaining

11:43

about not enough inventory for a

11:45

decade. 10 years since 2015, that's

11:47

pretty much been the mantra. However,

11:49

there are obviously local differences, right?

11:52

If you look at Austin, Texas,

11:54

for example, or even a couple

11:56

of Florida markets, inventory is definitely

11:58

increasing in those markets. And we're

12:01

going to look at something on

12:03

that in just a moment. But

12:05

I want to remind you, get

12:07

your tickets for Empowered Investor Live

12:09

coming up just about a month

12:12

from now. Go to Empowered Investor

12:14

Live.com. Come and join me. Come

12:16

and join our great investment counselors.

12:18

We're going to make a big

12:21

focus of this event on. options

12:23

and rent to own deals that

12:25

are a fantastic strategy where you

12:27

can multiply your security pauses dramatically,

12:29

you can delegate repair and maintenance

12:32

responsibilities to your tenant buyers, and

12:34

you can really have a dramatically

12:36

increased return on investment. You can

12:38

see Mike Maloney. the foremost expert

12:41

on monetary history. He is a

12:43

fascinating guy, first time speaker and

12:45

empowered investor live. Of course, Sharon

12:47

Lector will be back with us

12:49

as well. Her resume is so

12:52

long and so big. She's the

12:54

co-author of Rich Dad Portad. She's

12:56

fantastic. And. Tom Wheelwright All Star

12:58

Rockstar CPA will be with us.

13:00

Those are some of our keynote

13:03

speakers, and we have many other

13:05

speakers as well. By the way,

13:07

I want to mention, we negotiated

13:09

a fantastic room rate. I mean,

13:12

we've got a gorgeous venue, a

13:14

freshly remodeled hotel. We've held many

13:16

events at this hotel over the

13:18

years. It is a resort hotel.

13:20

and we've got rooms for only

13:23

$199 per night. That was a

13:25

fantastic deal. We were able to

13:27

negotiate. By the way, I'll just

13:29

tell you how these events work.

13:32

A lot of event promoters and

13:34

event hosts, they basically pay for

13:36

their food and catering budget and

13:38

their ballroom budget and their audio

13:40

visual budget by increasing room rates.

13:43

Okay, when you negotiate a hotel

13:45

contract, you get to choose that.

13:47

We don't do that. We try

13:49

to get the lowest rate for

13:52

you and $199 tonight is a

13:54

great, great deal for this beautiful

13:56

property. So come join us for

13:58

that. Also, you get a free

14:00

ticket to Rebel Capitalist Live that's

14:03

about a month later or maybe

14:05

a month and a half later

14:07

with George Gammon. We basically did

14:09

a deal where we're trading any

14:12

Rebel Capitalist Live ticket buyer gets

14:14

a free ticket to our event

14:16

and our buyers get a free

14:18

ticket to their event. So we

14:20

did a nice co-promotion with George

14:23

Gammon on that one for Rebel

14:25

Capitalist Live. So if you buy

14:27

any of our tickets, you get

14:29

a free ticket for that event

14:32

as well. Have you ever wondered?

14:34

how the top real estate investors

14:36

consistently find the best deals before

14:38

anybody else? Well, listen up because

14:40

this can transform how you invest.

14:43

I'm excited to share something that's

14:45

revolutionizing the real estate game. It's

14:47

called Connected Investors. This is a

14:49

really cool platform that gives you

14:52

access to all of the property

14:54

records nationwide. Truly amazing. It's not

14:56

just a platform though, it's a

14:58

secret weapon, it does a whole

15:00

bunch of things besides the property

15:03

data, it's a social network as

15:05

well. It's built by successful real

15:07

estate investors. for real estate investors.

15:09

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15:12

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15:14

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15:16

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15:18

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15:20

you're a beginner or a pro-connected

15:23

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15:25

smarter, faster, and more efficient investing.

15:27

Try a seven-day free trial. Jason

15:29

Hartman.com/connected. Again that's Jason Hartman.com/connected and

15:32

let us know how much you

15:34

love this software. Okay so let's

15:36

take a look at some inventory

15:38

stats for just a moment. Now

15:40

this is interesting because it depends

15:43

where you get the data and

15:45

this is redfin data and it

15:47

shows that there are currently almost

15:49

one 0.8 million active listings. Now

15:52

this is seasonally adjusted, okay, so

15:54

it will kind of smooth out

15:56

there a little bit, but that's

15:58

not the number we use. We

16:00

go with the altos data, okay,

16:03

and red fins similar to NAR

16:05

data, but it doesn't matter what

16:07

data you use, it matters that

16:09

you compare it historically to the

16:12

same data. That is what is

16:14

important. So with a consumer price

16:16

index, for example, this is a

16:18

good comparison. This is a good

16:20

comparison. the CPI or the CPI,

16:23

as I call it, they had

16:25

some big changes to the consumer

16:27

price index right around 1980. They

16:29

made some big, big changes. And

16:32

that's why inflation reporting seems much

16:34

more desirable than it used to

16:36

be. That was most likely a

16:38

response to the high inflation of

16:40

the 1970s, and they changed it,

16:43

and they have been lying to

16:45

us ever since. Remember, three major

16:47

ways. They manipulate the inflation data,

16:49

waiting, substitution, and hedonic indexing. I've

16:52

talked about that on many other

16:54

prior episodes. So you can always

16:56

go to JasonHartman.com. You can click

16:58

on our little chatbot or you

17:00

can go directly to it by

17:03

going to JasonHartman.com/AI for artificial intelligence.

17:05

And you can talk to my

17:07

AI clone. where I have become

17:09

immortal. Well, I guess immortal as

17:12

long as we're paying the bill

17:14

for the clone, right? As soon

17:16

as the bill stops paying, the

17:18

clone will die, okay, or it

17:20

stops being paid. And you can

17:23

ask it any question, but you

17:25

can find the episodes because it

17:27

footnotes and references my material that

17:29

it's been trained on, almost 2,000

17:31

podcast episodes. So, a lot of

17:34

content there, a lot of good

17:36

stuff there for you. So. 635,000

17:38

is the inventory number of active

17:40

listings, according to the altos data,

17:43

which I prefer. And I don't

17:45

prefer it because it's a lower

17:47

number. I prefer it because it's

17:49

a more consistent and more accurate

17:51

number. It does not include pending

17:54

sales. It does not include contingent

17:56

sales like this other data does.

17:58

But again, as long as you

18:00

make the apples to apples comparison.

18:03

That's okay. Because what do we

18:05

have here? If we look at

18:07

the redfin data, we had almost

18:09

3 million active listings, according to

18:11

what they call active, in 2012,

18:14

right, coming out of the Great

18:16

Recession in 2012. And now we've

18:18

got 1.75 million active listings, okay,

18:20

so million, 800,000 almost. versus the

18:23

600,000. It just depends what you

18:25

call active and whether or not

18:27

it's seasonally adjusted. Okay, that's another

18:29

important thing. All right, so here

18:31

is yet another metric. Now this

18:34

is from realtor.com and I want

18:36

you to see the difference here.

18:38

Now, the altos data tells us

18:40

we have about 635,000 listings and

18:43

the realtor.com data tells us 847,

18:45

it doesn't tell us what the

18:47

redfin data says that's 1. 1.8

18:49

million. So do you see how

18:51

confusing this can be? Just compare

18:54

apples to apples. That's really all

18:56

you need to do most of

18:58

the time. And here, if we

19:00

look at these different years, right,

19:03

we see that in 2017, okay,

19:05

whereas the 2017 line, we had

19:07

a much higher inventory, almost, well,

19:09

not quite double, but yeah, like

19:11

180% of the inventory we have

19:14

today, I guess, would be about

19:16

the accurate number. And back in

19:18

2022, in the COVID era, the

19:20

number was less than half and

19:23

it got down even lower than

19:25

that. Again, if you're using the

19:27

consistent alto stats, about 240,000 homes

19:29

is all we had for sale

19:31

back then during the COVID era.

19:34

Okay, so let's look at some

19:36

more stuff here. Now this is

19:38

the Florida supply, okay, and it

19:40

says Florida housing supply hits record

19:43

high, but this is very misleading.

19:45

Why is it so misleading? So

19:47

if we go back, this chart

19:49

goes back to 2012. Okay, so

19:51

it goes back 13 years, and

19:54

we see that the inventory is

19:56

higher now than it was 13

19:58

years ago, but it's about the

20:00

same as it was in the

20:03

pre-pandemic level. In fact, it's like

20:05

exactly the same as it was

20:07

in 2019. Okay, so what does

20:09

that mean? This is extremely misleading

20:11

because the Florida population has increased

20:14

quite dramatically. And it's not only

20:16

population that counts. it's number of

20:18

households. So you would be very

20:20

wrong to compare this chart and

20:23

say, oh, the Florida housing market

20:25

is terrible, because 13 years ago,

20:27

inventory was lower than it is

20:29

today. Well. the whole state was

20:31

smaller than it is today. The

20:34

population was much smaller than it

20:36

is today. The number of households

20:38

were much smaller than they are

20:40

today. The number of jobs available

20:43

in Florida were much smaller than

20:45

they were today. The number of

20:47

retiring baby boomers that moved from

20:49

the northeastern states with the terrible

20:51

climates after they were tired was

20:54

much smaller than it is today.

20:56

So again, you got to just

20:58

peel back the layers of these

21:00

onions folks and really... understand the

21:03

truth of the matter, and that

21:05

is the truth of the matter.

21:07

Now, this is another interesting thing,

21:09

and it is average home prices

21:11

versus inflation. And it shows you

21:14

the buying power, because the buying

21:16

power in 1963, right? 1963, that's

21:18

where they have parody, where the

21:20

home price and inflation start, and

21:23

The house there is $18,215. By

21:25

2009, the house price was $215,000,

21:27

but the buying power was only

21:29

$185,000. So this is where you

21:31

see there's this big separation between

21:34

buying power and home price. And

21:36

now you see it is terrible.

21:38

2023 is where it's at $425,000.

21:40

The home price versus inflation went

21:42

down a little bit vis-a-vis inflation

21:45

only, but the buying power remains

21:47

dramatically, dramatically lower than the house

21:49

price, even when it's adjusted for

21:51

inflation. So what does this mean?

21:54

What does it tell you? It

21:56

tells you. that landlords are going

21:58

to be very happy that it

22:00

is a renting market right well

22:02

let me say that correctly it

22:05

is not a renters market although

22:07

a lot of renters will be

22:09

renting because they can't afford to

22:11

buy it is a landlord's market

22:14

and that's why you want to

22:16

own more property in this landlords

22:18

market because that appears only be

22:20

getting more and more significant that

22:22

divergence between buying power and house

22:25

prices. And I have a little

22:27

more data for you here. Now

22:29

this one starts in 1985 and

22:31

you can see how income does

22:34

not keep up with rent, not

22:36

even close, right? The percentage change

22:38

in rent versus the percentage change

22:40

in income is dramatically different. Okay,

22:42

1985 started at parody, 1995, it

22:45

was pretty darn close, like it

22:47

was affordable to rent a house,

22:49

but now the rent is just

22:51

dramatically higher than the income. Now,

22:54

what would be misleading about this?

22:56

Always ask yourself that. What is

22:58

the chart not telling us is

23:00

the house itself got better. The

23:02

house we were willing to accept

23:05

in 1985 had inferior finishes. it

23:07

was smaller in size and it

23:09

was not as good a house

23:11

as today's house. Okay, today's house

23:14

is a better house except for

23:16

one thing. The lot size got

23:18

smaller, the land shrunk, but the

23:20

house got better, right? So we

23:22

see, you know, the average lot

23:25

size versus the house keeps getting

23:27

bigger, but the lot size keeps

23:29

getting smaller. So there are many

23:31

factors here and I just want

23:34

you to always realize all of

23:36

those factors. Terrace. Trump tariffs are

23:38

a big big deal obviously and

23:40

you see that Trump is definitely

23:42

shaking up the world. He's actually

23:45

demanding that Ukraine pay the US

23:47

back for the massive support it

23:49

got in. It's worth it. And

23:51

why is that considered unreasonable? I

23:54

mean, that's just reasonable. Hey, look,

23:56

it's like we were the lender

23:58

of last resort and we lent

24:00

money and weapons, right? High-tech, great

24:02

fantastic weapons. And Ukraine has to

24:05

pass back for that. Imagine that.

24:07

Well, what else is Trump doing

24:09

to piss everybody off? Okay. Well,

24:11

he's only pissing off. less than

24:14

half the people, but you know,

24:16

whatever. Let's look at housing stocks

24:18

here. So D.R. Horton, largest home

24:20

builder in America, housing their stock

24:22

price way down. Okay, with all

24:25

this, this news of tariffs, Lanar,

24:27

same thing. These builders are really,

24:29

really concerned about the tariffs. And

24:31

I'm sure they are in full

24:34

lobbying mode to lobby the administration

24:36

to not do tariffs. But Trump

24:38

actually, being the very smart guy

24:40

that he is, I know some

24:42

of you are thinking, oh he's

24:45

an idiot, you know, whatever, you're

24:47

wrong, but oh well, he's pretty

24:49

darn smart, or at least he

24:51

has smart advisors, I don't know,

24:54

whatever, the result. is pretty smart.

24:56

What he's doing now is opening

24:58

up whole new channels for harvesting

25:00

timber, just like he did with

25:02

oil. That's going to hopefully offset

25:05

the tariff problem. But think about

25:07

what happens. Here's the genius mix

25:09

of that, right? You tariff the

25:11

imports, the government raises money from

25:14

those tariffs, which means the external

25:16

revenue service rather than the internal

25:18

revenue service is now bringing in

25:20

extra funding for the government, lessening

25:22

the burden on all of us

25:25

taxpayers. Okay, so that's one effect.

25:27

The other thing that happens is

25:29

Americans now think, well, maybe I

25:31

ought to get into manufacturing all

25:34

those things that are normally imported

25:36

or these Chinese companies or whatever

25:38

country companies, they set up shop

25:40

in the United States. They employ

25:42

more people here, hire paying American

25:45

jobs, which mean more people with

25:47

more money to grow the economy

25:49

and stimulate the economy and create

25:51

more tax revenue. And at the

25:54

same time, Trump says we've got

25:56

all of these crops we can

25:58

harvest. Trees are just a crop.

26:00

They're just like corn. Listen, I

26:02

love trees. When I went to

26:05

New Zealand with my girlfriend Hillary

26:07

years ago, I decided I was

26:09

a closet tree hugger. Okay, I

26:11

love trees. They're beautiful. Absolutely love

26:13

them. I'm here in Santiago. Tree-lined

26:16

streets everywhere. It's just gorgeous. I

26:18

love vegetables too. Vegetables are just

26:20

a crop. That's what trees are.

26:22

They're just a crop that takes

26:25

longer to grow. Okay, so it's

26:27

fine to harvest them as long

26:29

as you replant them. All right?

26:31

just like any crop. It's fine

26:33

to harvest corn as long as

26:36

you replant it, okay? But for

26:38

those of you not watching on

26:40

video, I'm showing a chart of

26:42

the import reliance for home building

26:45

inputs in 2024. Builders heavily rely

26:47

on Chinese imports for appliances, small

26:49

appliances, nearly 50%. hardware nearly 50%

26:51

sawmill wood products. Okay. And that's

26:53

what Trump is lessening the price

26:56

pressure on now by allowing more

26:58

tree harvesting inside the US. Okay.

27:00

And that is about 30% plumbing

27:02

fixtures and trim. That's about 25%

27:05

and glass products about 20%. So

27:07

the mix is what's important. If

27:09

builders can buy American made or

27:11

American harvested materials, without those price

27:13

increases of the tariffs. That's great.

27:16

They pay higher prices for some

27:18

things for a time until the

27:20

American manufacturing catches up or the

27:22

foreign companies come and set up

27:25

shop here and create higher paying

27:27

American jobs. But all of this

27:29

has one. thing in common. The

27:31

net result is inflation, inflation, and

27:33

you as a real estate investor

27:36

benefit from that dramatically, inflation induced

27:38

debt destruction, higher housing costs, the

27:40

greatest hedge against inflation ever is

27:42

income property, higher rents, and higher

27:45

affordability from more American workers who

27:47

either get less taxed because we

27:49

have the external revenue service that

27:51

makes us rely less on the

27:53

internal revenue service, and they have

27:56

just higher paying jobs. So the

27:58

net result of that, more money

28:00

to spend into the economy, more

28:02

dollars, limited supply of goods and

28:05

services, inflation, classic definition. So on

28:07

the tariffs, there are so much

28:09

news on this, there's no way

28:11

we could possibly cover it, but

28:13

just a little bit of an

28:16

example here. This is from one

28:18

of my newsletters that says, as

28:20

the Trump administration weighs new tariffs

28:22

on China, Apple has announced plans

28:25

to invest 500 billion in the

28:27

United States, over the next four

28:29

years, including the addition of 20,000

28:31

new hires to its workforce. So

28:33

how many employees does Apple have?

28:36

I think they have like 80,000

28:38

employees or something like that, right?

28:40

It's an incredible number. So they're

28:42

going to increase their workforce by

28:45

25% in the United States and

28:47

invest half a trillion dollars in

28:49

the US. Right? They wouldn't have

28:51

done this if it wasn't for

28:53

Trump. If it wasn't for the

28:56

tariff threats, this would have never

28:58

happened. They would have just continued

29:00

with their cheap overseas manufacturing. Apple

29:02

will open a 250,000 square foot

29:05

server facility in Houston slated to

29:07

begin operations next year with plans

29:09

to expand to other states and

29:11

hire thousands more people. New jobs

29:13

will mostly focus on research and

29:16

development, Silicon Engineering, AI and machine

29:18

learning the company said. What do

29:20

you think those jobs pay? I

29:22

think those jobs pay pretty well.

29:25

That means those people really really

29:27

contribute to the economy. Apple said

29:29

the investment will also boost its

29:31

chip manufacturing efforts in the United

29:33

States, as well as skills development

29:36

programs for students and workers. The

29:38

move came shortly after CEO Tim

29:40

Cook met with President Trump, who

29:42

recently imposed a 10% tariff on

29:45

goods imported from China. Wow, you

29:47

want to make the country stronger,

29:49

you want to bring the manufacturing

29:51

here, you want to make the

29:53

hiring happen here, and it's so

29:56

much. better. Why it matters. Questions

29:58

remain about Apple's motivations in announcing

30:00

the investment, whether to shield itself

30:02

from tariffs or to signal an

30:05

America first stance to the Trump

30:07

administration. Other tech companies are also

30:09

investing billions in the US, including

30:11

open AI, Microsoft, Soft Bank, Oracle,

30:13

through the 500 billion dollar Stargate

30:16

project. Folks, this is genius. These

30:18

tariffs are going to work. They

30:20

are going to work beautifully. And

30:22

I know some of you have

30:25

your doubts, but just wait. You

30:27

know, there's that old biblical principle

30:29

of being equally yoked, right? In

30:31

a marriage, you need to be

30:33

equally yoked. In a business deal,

30:36

both partners, both sides need to

30:38

be equally yoked. They have to

30:40

have equal amount of burden and

30:42

obligation on them. And the tariffs.

30:44

level the playing field. So it's

30:47

going to be wonderful. Now, you

30:49

want to know another genius move?

30:51

Oh, wow. Just came out last

30:53

week. Trump's new gold card program.

30:56

This is brilliant. It is brilliant.

30:58

Do you know the massive amount

31:00

of stimulation this will do for

31:02

the US economy? It will be

31:04

nothing short of incredible. So what

31:07

is that program? He wants to

31:09

offer a $5 million. essentially golden

31:11

visa to wealthy foreigners to come

31:13

to the US, have residency in

31:16

the US, have a path to

31:18

citizenship in the US, and all

31:20

of those people are going to

31:22

bring their talent, their brains, their

31:24

capital, the amount of what used

31:27

to be called foreign direct investment

31:29

wouldn't even be considered FDI or

31:31

foreign direct investment. It would just

31:33

be investment because these people would

31:36

live in the US. They would

31:38

hire people, they would stimulate the

31:40

economy, they would spend into the

31:42

economy, and it's just beautiful. It's

31:44

incredible. It's an amazing time to

31:47

be alive. We are witnessing incredible

31:49

things going on. And you just

31:51

gave it a little time to

31:53

play out. It's going to be

31:56

phenomenal. Okay, I reported on this

31:58

before. Well, this is Marco Santarelli.

32:00

Another one of these reviews came

32:02

up. I thought this was done,

32:04

but apparently this investment fund, which

32:07

The people say is a scam.

32:09

I don't know. I don't have

32:11

any information myself. I'm just reading

32:13

the reviews and hearing what I

32:16

hear through the industry. But this

32:18

one is from Ari Wealth Creator,

32:20

and it's a one-star review. It

32:22

says, stop stealing investor money. Yes,

32:24

Marco, don't promote your investment opportunities

32:27

and lie about its performance to

32:29

investors. You've lost. hundreds of investors

32:31

money to the listener, you're listening

32:33

to a scam artist or Bernie

32:36

Madoff type. Marco isn't to be

32:38

trusted. He'll steal what he can

32:40

from you. He should be in

32:42

jail. Now, a whole bunch of

32:44

these reviews like this came in

32:47

on iTunes or I should say

32:49

Apple Podcast. Now, several months ago,

32:51

and we did report on it,

32:53

but this one just came in

32:56

the other day. So it's really

32:58

awful to see this kind of

33:00

thing because you want to remember

33:02

Commandment number three. Vow shalt maintain

33:04

control. When you relinquish control to

33:07

another party, and look, in reality,

33:09

we all have to relinquish some

33:11

control to somebody, right? We can't

33:13

be in control of everything. At

33:16

least the economy is in some

33:18

control in the marketplace, right? But

33:20

you leave yourself susceptible to three

33:22

major problems. Number one, you might

33:24

be investing with a crook, okay?

33:27

Bernie Madoff, right? Enron. global crossing,

33:29

you know, all of the scams

33:31

on Wall Street that you've all

33:33

heard about, all of the real

33:36

estate syndicators, all of the fund

33:38

managers that have scanned people, and

33:40

I guarantee you, there are many

33:42

of those out there. right now

33:44

in today's market who seem to

33:47

be great who seem to be

33:49

making money for their investors and

33:51

everybody loves them and they're doing

33:53

great and you know what they

33:56

opened up a bunch of philanthropy

33:58

arm to hide their misdeeds and

34:00

they're doing all this stuff right

34:02

and you just wait a few

34:04

years and you'll see that a

34:07

lot of these people have been

34:09

scamming people so we say Be

34:11

a direct investor, maintain control, valve

34:13

shop, maintain control. Number two problem,

34:16

assuming you invest with someone who's

34:18

honest, the number two problem is

34:20

you might be investing with an

34:22

idiot, right? You'll lose money just

34:24

because of their sheer incompetence. So

34:27

assuming they're honest and competent, the

34:29

third problem is they take a

34:31

giant management fee off the top

34:33

for managing the deal. And you

34:36

don't want to be subject to

34:38

that, right? You want the money

34:40

to flow to you as the

34:42

investor. You don't want to give

34:44

it to some CEO, some fund

34:47

manager, some investment banker, you know,

34:49

you just want to be direct

34:51

as much as possible with your

34:53

investments. Commandment number three. don't let

34:56

this kind of thing happen to

34:58

you. Okay, this is from the

35:00

Wall Street Journal, by the way,

35:02

interest in second homes and rentals

35:04

continues to rise among the wealthy.

35:07

The latest survey from the Wall

35:09

Street Journal Intelligence recorded an uptick

35:11

in real estate investing while other

35:13

passion assets from jewelry to art

35:15

declined. Real estate is the thing

35:18

and everybody wants it. Now imagine

35:20

you combine this with Trump's golden

35:22

visa program. right for a measly

35:24

and by the way that is

35:27

a measly five million dollars that's

35:29

nothing there are so many super

35:31

wealthy people around the world five

35:33

million dollars to have US residency

35:35

and a path to US citizenship

35:38

and have all the opportunities to

35:40

access the US market to access

35:42

US banks to access US lenders

35:44

that's so worth five million dollars

35:47

I mean when you would pay

35:49

a million dollars to get an

35:51

EU citizenship five million for US

35:53

is dramatically better than a million

35:55

for EU. Okay, that's the way

35:58

any wealthy person would do the

36:00

calculus on this. Can you imagine

36:02

when these people come here and

36:04

have access to our markets and

36:07

can just readily buy all these

36:09

properties just like any American? Can

36:11

you imagine how that will massively

36:13

increase demand? Yeah, it will. And

36:15

here is another survey. This is

36:18

from Housing Wire. It says real

36:20

estate investors say they'll expand portfolios

36:22

and make home improvements this year.

36:24

Data shows that nearly 60% of

36:27

US investors plan to acquire new

36:29

properties this year. This is a

36:31

rent ready survey. We had rent

36:33

ready on the show before, by

36:35

the way. What are your plans

36:38

for your real estate portfolio in

36:40

2025? The large landlords, 51% of

36:42

them said. They plan to acquire

36:44

more new properties. And on that

36:47

22% of them, they say they're

36:49

going to do a mix of

36:51

buying and selling and rejiggering their

36:53

portfolios. And 7% say no plans

36:55

to change. All investors overall, 54%,

36:58

so an astounding majority there, right,

37:00

say they plan to expand their

37:02

portfolios, 13% say they're going to

37:04

rejigger and mix them and buy

37:07

and sell. And 31% say they

37:09

don't have any plans yet. Okay,

37:11

and small investors, 54% of those

37:13

say they're going to buy, increase

37:15

the size of their portfolio, and

37:18

the medium investors say that's the

37:20

highest number, 55% of them say

37:22

they are going to expand their

37:24

portfolio size this year. Now, if

37:27

that is where the smart money

37:29

is going, maybe you should be

37:31

there too. Anyway, thank you for

37:33

listening today. Be sure to get

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37:58

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38:02

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38:04

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