Wealth Formula Podcast

Does it really?

In this conversation, Buck and Zulfe Ali discuss various topics including liability insurance, the economy, and money market funds. They highlight the importance of reviewing and updating insurance policies, the impact of consumer confidence on the economy, and the rising prices in the residential home market. They also explain the difference between money market funds and money market accounts, and the potential risks and returns associated with each.

Oh man…we are getting really sexy with topics on this show! On this week's episode of Wealth Formula Podcast, we are going to talk about liability insurance: malpractice insurance, property insurance—all that kind of stuff. I know this doesn't sound exciting, but do you know the five different parts of an insurance policy and what part is generally the one that will screw you over? I didn't think so. Here's my suggestion. Grab your property insurance policy and follow along with the show. I haven't read mine and you probably haven't read yours either. But this is stuff you need to know a little bit about because if you have to change something or get a new policy, now's the time to do it. Liability insurance is your first line of asset protection so make sure you have a grasp on it. This show will give you a nice place to start and it's actually pretty interesting. 04:06 Insurance 101 05:22 The 5 Main Parts of Insurance 10:29 How to Look for the Right Insurance Policy 13:19 How to Deal with Claim Adjuster 17:35 What Should You Be Asking When Buying Insurance 20:27 Why Property Insurance is Skyrocketing

Dr. Jonny Kim managed three impressive career changes going from Navy Seal, to doctor, to NASA astronaut and he did it all by the age of 37. What's your excuse?

Commentary on Sunday Podcast – Mark Skousen from FreedomFest General Overview: Mark Skousen made various comments on different topics, some of which were agreeable, while others were debatable. Inflation: Agreed: Different people experience different levels of inflation depending on their basket of goods and services. Disagreed: Inflation is not at a 10% rate, even considering shadow inflation (reduction in quantity or quality of goods and services for the same price). Global Warming: Disagreed: Global warming is not a manufactured crisis; clear data supports that the earth is warming and the climate is changing. Notable Data: The 10 most recent years are the warmest in recorded history, with emerging implications (e.g., rising insurance rates in Florida). Electric Vehicles (EVs): Neutral: While there's a debate on whether government mandates on the auto industry for EV production are reasonable, the necessity of such mandates is questioned. Political Spending: Agreed: Both Trump and Biden are big spenders. Disagreed: Democrats are not trying to get away with it, as they have explicitly stated intentions to raise taxes. Opinion: Republicans, by wanting to spend more and tax less, could be seen as trying to get away with increased spending without corresponding revenue. Update on Economy and Markets May CPI: Released data showed a 3.3% price increase on an annual basis, flat compared to April. First flat month-over-month CPI since May 2020, before the Fed's rate hike cycle began. FOMC June Meeting: Rates left unchanged. Signal of likely only one rate cut in 2024, down from previously anticipated two cuts. Stock Market: Continued rally, reaching new highs. Treasury and Mortgage Rates: 10-year treasury decreased by 20 bps to 4.2%. 30-year fixed mortgage rate around 7%. Bitcoin: Down by about 4% from the previous week, exhibiting volatility over the past 2-3 weeks. What are Structured Notes? Definition: Hybrid securities combining a bond and a derivative component linked to an underlier (e.g., S&P 500 index, commodity) designed to target a predefined investment goal. Characteristics: Generally unsecured debt obligations of issuers like investment banks. Performance linked to the underlying asset. Tailored to express a specific market view or meet a particular investment objective. Potential to achieve yield, growth, or principal protection. Risks: Creditworthiness: Dependent on the issuer's creditworthiness. Performance: Target returns are not guaranteed if the underlying asset underperforms. Holding Period: Designed to be held to maturity. Complexity: Financial instruments are complex and hard to understand.

This week's guest on Wealth Formula Podcast is Mark Skousen. He is the producer of FreedomFest which has become an extremely popular annual gathering every year that deals with not only money but other lifestyle topics as well. What is freedom anyway? To me, It's the ability to choose what you want to do with your life. Indeed, freedom is the ultimate prize in life and can only be achieved through financial independence. That is not to say that you can't be happy without being rich. You absolutely can. Maybe you have a job that you love and a life that you don't want to change. If that's the case, congratulations. But happy does not mean free. What if someday you start hating your job and want to make a big change in your life? Could you afford to follow a dream without being concerned about money? Most professionals can't. That's why high-paid W2 jobs are often called "golden handcuffs". How do you break free from the golden handcuffs? Well, one of the key variables of the mathematical Wealth Formula is that you deploy capital quickly so that you can start changing the balance of power between you and your money. Eventually, you want your money to work for you more than you work for it. But achieving financial freedom isn't easy. It involves not following the herd and not giving up. You see, no one has ever gotten rich from a simple portfolio of stocks, bonds and mutual funds. Sure they may grow your money a bit and provide some security in the future. But you simply cannot change your socioeconomic status this way. Getting rich involves taking bigger risks. I have made my money through business ownership and real estate. Have I lost money along the way? You bet I have. But have I made more money investing in real estate and business over the last 15 years than I would have following the herd? Yes…by a mile. To be clear, I am not giving you financial advice. Personal finance is personal. I just want to open your eyes and see the trajectory you are on and recognize whether or not it will get you where you want to be. In the immortal words of former NFL coach Bruce Aryans, "No risk it, no biscuit. Now, make sure you tune into this week's podcast with FreedomFest producer and "America's economist", Mark Skousen. Show Notes: 08:07 Why are the Numbers not Matching Our Anxiety? 09:54 GDP vs Growth Output 14:32 10% Inflation? 18:00 Implications of the Presidential Election 26:12 The Indicators to Look Out For 30:55 FreedomFest

This week's guest on Wealth Formula Podcast is Mark Skousen. He is the producer of FreedomFest which has become an extremely popular annual gathering every year that deals with not only money but other lifestyle topics as well. What is freedom anyway? To me, It's the ability to choose what you want to do with your life. Indeed, freedom is the ultimate prize in life and can only be achieved through financial independence. That is not to say that you can't be happy without being rich. You absolutely can. Maybe you have a job that you love and a life that you don't want to change. If that's the case, congratulations. But happy does not mean free. What if someday you start hating your job and want to make a big change in your life? Could you afford to follow a dream without being concerned about money? Most professionals can't. That's why high-paid W2 jobs are often called "golden handcuffs". How do you break free from the golden handcuffs? Well, one of the key variables of the mathematical Wealth Formula is that you deploy capital quickly so that you can start changing the balance of power between you and your money. Eventually, you want your money to work for you more than you work for it. But achieving financial freedom isn't easy. It involves not following the herd and not giving up. You see, no one has ever gotten rich from a simple portfolio of stocks, bonds and mutual funds. Sure they may grow your money a bit and provide some security in the future. But you simply cannot change your socioeconomic status this way. Getting rich involves taking bigger risks. I have made my money through business ownership and real estate. Have I lost money along the way? You bet I have. But have I made more money investing in real estate and business over the last 15 years than I would have following the herd? Yes…by a mile. To be clear, I am not giving you financial advice. Personal finance is personal. I just want to open your eyes and see the trajectory you are on and recognize whether or not it will get you where you want to be. In the immortal words of former NFL coach Bruce Aryans, "No risk it, no biscuit. Now, make sure you tune into this week's podcast with FreedomFest producer and "America's economist", Mark Skousen. Show Notes: 08:07 Why are the Numbers not Matching Our Anxiety? 09:54 GDP vs Growth Output 14:32 10% Inflation? 18:00 Implications of the Presidential Election 26:12 The Indicators to Look Out For 30:55 FreedomFest

If Buck could restart his life, would he have gone to medical school or straight into finance?

Thoughts on Sunday podcast on internet business investing: Seems like a platform really suited for people with e-commerce expertise I wouldn't know how to evaluate or run an Internet business Investing under a manager who knows what they're doing might make sense, but we'd need to see the track record I tend to think this is an area where you need to have operating expertise to be successful, even as a passive investor Latest on the economy and markets: When we spoke last week, we had just received the latest job openings report which showed some continued slowdown in the job market with decreasing (but still positive) job openings. Since then, another labor market statistic, came in a bit hotter than expected in terms of payrolls added in the month of May So we're seeing some mixed data on the labor front as well as mixed data on various inflation measures Generally speaking the economy, inflation and labor markets are cooling. But it's not a necessarily smooth ride; there's volatility as can be expected Implications: Chairman Powell will do a press conference Wednesday The focus will all be on his messaging related to outlook as we head into the 2nd half of 2024 Most economists have been assuming 2 or 3 rate cuts in 2024; so there will be a focus on Powell's messaging The FED is likely to keep steady on the Fed Funds Rate in the months ahead The FED is currently in its two-day FOMC meeting which is being held over Tues and Wed of this week Overall, the trading markets have been stable over the past week: Equity markets are up 1%-2% since last week depending on which indices you look at, S&P, Nasdaq, Dow… The 10-year bond yield ticked up about 10 basis points in that time Gold and Bitcoin are down a bit off their highs One thing to note about the performance of the stock market this year is that strong positive performance has been very narrow But if we look at which type of companies have fueled that gain, it's all based on the very large cap stocks like Apple, Alphabet, Microsoft, Amazon, NVIDIA, META- the companies with market capitalization in excess of $1 Trillion In fact, those companies have gained about 40% in price YTD, while all other companies together (that are below $1 trillion market cap) have pretty much traded flat on the year. The real end game with AI is unleashing productivity for companies and therefore driving profitability For example, the S&P 500 is up about 13% year to date in 2024 On the one hand, this is not reassuring since it's so concentrated and it seems most companies are not doing all that well On the other hand, it could be the case that the $1 Trillion companies are benefiting most right now from AI-driven earnings growth and that will spread across a much broader universe of companies in the coming months and years What I continue to like in this investment environment is real estate Buyers are able to negotiate better purchase prices, especially in situations where the seller is distressed If inflation gets to a point where the Fed starts cutting rates, real estate prices will go up If inflation remains an issue, well you want to own hard assets with leverage I am optimistic about the equity markets over the longer term, because I think the US economy will continue to grow and we have the potential for AI to drive profitability over the next several years In the short term, with rates uncertainty and elections upcoming, it will probably be somewhat volatile in the public markets New product to discuss: Mutual Funds versus ETF (Exchange Traded Funds) Both are investment fund structures available to investors Most EFTs are passive and pegged to the performance of a particular index Most Mutual Funds are actively managed by fund managers; can also be passive, indexed funds Passive versus active management is a strategic choice. If you've ever heard of the theory of a monkey throwing darts having a good chance of beating the stock picks of a professional stock fund manager, there is good evidence to support this… David Swenson, the guy who is responsible for the Yale Endowment's consistent and stellar performance for multiple decades, is passionate about his view that investors avoid active management strategies for the public stock market. He has done tons of research showing how active management does not beat passive investing in any consisted manner. Trading: ETFs trade like stocks in the secondary market. You can buy and sell them throughout the day and their price changes constantly reflecting the immediate market price. Mutual funds can only be bought and sold at the end of each trading day. Fees: ETFs usually have materially lower fees to investors Mutual funds have larger fees and can include upfront fees when you buy, ongoing management fees when you own the mutual fund, and exit fees when you sell. Often these vary depending on what class of mutual fund shares you purchase and how big your investment amount is. Minimum investments ETFs don't have minimum investment amounts. Like stocks of companies Mutual funds typically require a minimum investment of $3k or more Tax efficiency: ETFs are more tax efficient; they are managed to minimize capital gains events – they rarely pay out capital gains Mutual fund managers, on the other hand, sell securities to handle redemptions or asset reallocation and generate capital gains for shareholders – even those with unrealized losses Overall, investors are better off with ETFs; especially when they are investing in passive strategies

After finishing residency and swallowing the purple pill (reading a Kiyosaki book), I found my entrepreneurial self for the first time. I was a like a kid in a candy store looking for any business opportunity I could think of. My initial foray into the entrepreneurial world related to my background—as a surgeon. I started with medical businesses. I say businesses here to make the distinction that these were not run-like practices. They involved branding, heavy marketing budgets and cash pay. Unlike many entrepreneurs, my first few businesses were successful for several years. However, at times, I also felt a tremendous amount of stress because of the overhead involved in such brick-and-mortar operations. Anyone who runs a business knows that there are lots of bills to be paid regardless of whether or not your business makes money. You've got payroll, advertising, insurance costs, rent—it all adds up. My fixed costs for my initial Chicago business were running about $200K per month and the costs would go up as income came in because commissions needed to be paid out. Unless we were pulling in north of $300K per month, there wasn't much profit left for me. So, in certain months I felt rich and in other months I felt like a pauper. Those initial brick-and-mortar businesses are gone now. They gave me my start and made me some money over the years. But, as often is the case with small startup businesses, they often don't last forever. So what did I learn from them? Well, as you can imagine, I learned a lot. I learned that I prefer boring businesses to flashy ones because they tend to have less competition. I learned that you must have competent and reliable management that is not too concentrated in the hands of one person. And, I learned to avoid businesses with significant fixed expenses. Avoiding significant overhead is perhaps my biggest lesson. It's really quite awful starting off every month so far in the hole. But how do you avoid that? Well, one consideration is online business. They can be as boring as you want. They can be automated to a certain degree making management and employees less critical. And, in many cases, there are minimal fixed costs. Therefore, I have always been curious about buying an online business. For that reason, I invited a representative from one of the largest online business brokers in the world to discuss this type of asset. It's an interview where you will learn a lot. I highly recommend tuning it. However, just to be clear, I have never done business with this company nor am I endorsing them. I have no financial relationship with them either so please do your own due diligence if the spirit moves you to contact them. Show Notes: 05:00 What Does Buying An Online Business Entail? 07:10 How Is An Online Business Different From a Physical One? 08:25 Where Do I Start? 11:50 Where Are the Operators Coming From? 12:55 How Does the Operation Work? 17:11 The Risks 20:03 What Determines the Multiples of Sites? 23:15 The Due Diligence 24:34 The Success Rate