If you haven’t heard the news already, Bernard Madoff has just passed away at the age of 82 in a federal prison hospital in Butner, North Carolina. For more than 50 years, Bernie Madoff was renowned on Wall Street as a big money manager who founded his own firm at age 22 and became non-executive chairman of the Nasdaq in 1990.Madoff was famously known for running the largest and possibly most devastating Ponzi scheme in financial history.He defrauded thousands of investors out of tens of billions of dollars over the course of about 17 years. Madoff was busted on December 11, 2008 after his two sons turned him in. Victims included director Steven Spielberg, actor Kevin Bacon, former New York Mets owner Fred Wilpon, Hall of Fame pitcher Sandy Koufax and Nobel Peace Prize winner Elie Weisel, as well as ordinary investors like Burt Ross who lost $5 million in the scheme. In a 2013 email to CNBC from prison, Madoff mentioned that the break in the market that started the Great Recession led to his scam.“I thought this would be only a short-term trade which could be made up once the market became receptive. The rest is my tragic history of never being able to recover.”In today’s podcast, Phil and Danielle discuss Bernie Madoff and his scheme that led to the nation’s largest financial fraud in history, You can learn a lot from the history of financial figures and investors. Check out my guide where I discuss some of the best investors in the world: https://bit.ly/2P21xJs Learn more about your ad choices. Visit megaphone.fm/adchoices

According to Phil and other value investors, investing should always essentially involve the same principles — even for non-stock investments like bonds. Putting your money where your values are, buying investments at a discount, and being able to move through different types of assets fluidly.  For example, bonds and securities are other types of low-risk investments that investors purchase. However, their potential for returns is much lower as well. A bond might only make you a 3% return on your money over multiple years. This means that when you take your money out of the bond, you’ll have less buying power than when you put it in, because the rate of growth didn’t keep up with the price of inflation.  Bonds can be purchased from the US government, state and city governments, or from individual companies. Mortgage-backed securities are a type of bond typically issued by an agency of the U.S. government, but can also be issued by private firms.  When you purchase a bond, you are essentially loaning money to either a company or the government. For U.S. investors, this is typically the U.S. government, though you can buy foreign bonds as well. The government or company selling you the bond will then pay you interest on the “loan” over the duration of the bond’s life cycle. Corporate bonds are slightly riskier than government bonds because there’s more risk of a corporation defaulting on the loan. Unlike when you invest in a corporation by purchasing its stock, purchasing a corporate bond doesn’t give you any ownership of that company. In today’s podcast, Phil and Danielle discuss bonds, and why the best investments to make for yourself depend on your risk tolerance, level of understanding of certain markets, timeline, and reason for investing.  Learn more about your different investment options with this Complete Guide to Investing for Beginners in 2021: https://bit.ly/3dYlBVI Learn more about your ad choices. Visit megaphone.fm/adchoices

Warren Buffett is currently sitting on about $150 billion in cash. Could this mean that doomsday — or a major market correction — is coming?Most of the time, successful investing is a waiting game. Just as there are poor times to sell your stocks, there are poor times to buy them as well. And sitting on cash while you wait for a better opportunity is often one of the best investing decisions that you can make.As Rule #1 investors, we try to invest in companies that have at least a 50% margin of safety, meaning that there is at least a 50% upside between the company’s stock price and its true value.When valuations are as high as they currently are, though, it becomes difficult to find any quality companies that exhibit this margin of safety.Looking at the Shiller PE ratio, prices have only been this high twice in the past 140 years. The first time they got this high was in 1929. The second time was in 1999. But we might not be here for much longer. Following the smart money — defined as money from big-time investors who know the market better than anyone — is rarely a bad idea, and right now, these investing gurus aren’t putting a lot of money into the market. Instead, the majority of the money flowing into the market right now is coming from retail investors.While these retail investors are buying stocks faster than ever before, the big investing gurus are sitting on their cash. This alone is a pretty good indication that right now might not be the best time to buy into the market.As Rule #1 investors, we like to find companies that are solid enough to survive and thrive no matter what the market does. When a major market correction, as the one that is very likely on the horizon drives the price of these companies down, the opportunity for great returns is higher than ever.Will the stock market crash? What are you going to do if it does? Today, Phil and Danielle discuss what investors should look out for in the stock market, and how to prepare for a potential doomsday.This Stock Market Crash Survival Guide will help you prepare for the next market crash and help you cash in when the market drops: https://bit.ly/3dDUfnF Learn more about your ad choices. Visit megaphone.fm/adchoices

In thinking about the process of finding wonderful companies at attractive prices, it helps to think of what I call the Four Ms: meaning, management, margin of safety, and moat. This podcast is focusing on moat. Most people know a moat to be the water around a castle but in investing terms, a moat is the durable competitive advantage that a company has that protects it from being attacked by competitors. A moat is what makes a company predictable and allows us to put a value on the business. Charlie Munger said that “Coca-Cola is the perfect business because it has this gigantic durable competitive advantage, or moat, which gives it predictable cash flow.”  This allows us to figure out what the future cash flow will be and value the company today, so we know whether we can buy it on sale or not. Finding a business with a wide moat is key to finding a successful business to own, because a business with a wide moat is much more predictable for the next 20 years than a business with no moat. The idea of the moat is really simple. If an industry looks as if it might be very easy to get into, there probably isn’t a moat. On the other hand, if an industry looks as though it might be really hard to get into and be successful, you’ll probably find some wide-moat businesses. In today’s podcast, Phil and Danielle discuss moat and value, and the processes in which they pick stocks with confidence.  Learn more about moat and the other three Ms of investing with this free guide that I’ve created for you: https://bit.ly/31xiBto Learn more about your ad choices. Visit megaphone.fm/adchoices

Stock splits happen from time to time, so it's important for us as investors to understand what they mean and how they might impact our investing decisions.A stock split is when a company decides to exchange more shares of its stock at a lower price for stockholders' existing shares. So, what happens to a stock’s price when it splits?  Nothing actually, although, it’s going to look like something big happened. Stock splits don’t change the market cap, which is the market price of the stock on a given day multiplied by all of the shares, or the sticker price of a stock one single cent. Not a penny. All a stock split does is change the number of shares and the price per share. I repeat: this does not change the total value of all those shares by even one cent.A lower stock price makes it easier to trade because the stock becomes more attainable for interested investors who may have been priced out of buying it in the past. Lower prices make it easier to find buyers than higher prices.When a stock price goes over $100 a share, people start to think of it as “expensive” even though the price of the stock has nothing to do whatsoever with the actual market cap of the business. A business worth $1 million is worth $1 million whether there is one share worth $1 million or 1000 shares worth $1000 each or 1 million shares worth $1 each.But how many buyers are out there for a single share of stock worth $1 million? Not very many. Let’s say there was one buyer. The owner of that single share might have to take a much lower offer simply because there is only one buyer. But if there were a million shares at $1, there can be lots of buyers. Lower stock prices make trading easier, which makes investors trade more often. Trading more often makes for higher stock prices.The bottom line is that stock splits have no effect on the true value of a company. As Rule #1 Investors, we care about the value of a company, not its stock price. We don’t base our investments in a company on the price per share but instead look at the entire company as a real owner does.Learn how to find high-performance stocks with my Four Ms for Successful Investing guide. Click here to download: http://bit.ly/3f4Q32o Learn more about your ad choices. Visit megaphone.fm/adchoices

It’s never a great idea to sit on too much cash. Why? One word: inflation. Inflation is the devaluing of a currency’s buying power. It occurs over time as the government pumps money into the economy and there’s a larger money supply buying a relatively fixed amount of items. As the money supply grows, people feel like they have more money, so they’re willing to pay more for things. When there’s a lot of inflation, wages tend to increase and people then feel like they’ve got even more money, so they’re willing to pay a little bit more for a Coca-Cola. Inflation is something that many people completely forget to factor in when calculating how much money they’re going to need for retirement. Most people tend to assume that if you want to live on, say, $50,000 a year for the rest of your life you need to multiply that number by 30 years and that’s how much you need.  What they don’t take into account is inflation. This means that to retire, you may need much more than you think. The small percentage may not seem like a lot, but over time, it adds up. This is why investing is one of the most important things you can do to set yourself up for a financially secure future. Not just investing in anything, but investing in companies that align with your values. By making the decision to invest based on our personal values, we can change the world radically. In today’s episode of the InvestED podcast, Phil and Danielle discuss why cash is trash, and why it’s important to set yourself up for a financially secure future by investing with your values.Learn how to invest with your values with my Four Ms for Successful Investing Guide. Click here to download: http://bit.ly/3eFrdWP Learn more about your ad choices. Visit megaphone.fm/adchoices

After you have found a worthy company you would like to invest in and it’s on sale, the final step is to actually purchase the stock through a brokerage account so you can start reaping the rewards.This is an important step in the investing process, but it can seem confusing because there are several brokerage options out there.Buying shares in any company will require you to go through a broker. Brokers enable you to easily buy and sell shares in any public company, but they do charge a fee for their services.Once you are working with a broker, though, buying shares of a company is as simple as ordering something out of a catalog or making a purchase on Amazon. Simply choose the stock you want to buy, the number of shares you want to buy, and complete your purchase.A great option that has come available in recent years is the use of online brokers. Online brokers are a little more “self-serve” than traditional brokers, however, their fees are also much lower.For beginner investors with small amounts of money, online brokers are the best choice because the high brokerage fees of traditional brokers have the potential to eat up any profits. A few options include Charles Schwab, TD Ameritrade, Vanguard, Fidelity, and Robinhood.In today’s episode of the InvestED podcast, Phil and Danielle discuss stock brokerages, and explain why it’s so important to do your research before you commit to any broker.Learn more about getting started and making your first investment with my Complete Guide to Investing for Beginners in 2021. Click here to download: http://bit.ly/3qo3JI1 Learn more about your ad choices. Visit megaphone.fm/adchoices

Warren Buffett’s highly anticipated shareholder letter was released this past weekend. In this annual letter, Berkshire Hathaway's quarterly reports have offered investors a glimpse into the company's inner workings. Buffett also highlighted the fact that among the biggest winners in Berkshire’s investment portfolio was its 5.4% stake in Apple. Buffett noted that the iPhone maker was now one of his company’s three biggest assets, with its stake worth $120 billion as of December 31, 2020. Berkshire ended last year with $138 billion in cash. This is likely due to the market still being extremely overvalued.  Being one of the best value investors in the world — if not the best in the world — Buffett understands the importance of only purchasing wonderful companies at discount prices.  In the annual letter to shareholders, Buffett reminded investors that miracles do occur in middle America despite much of the attention on the east and west coast.  “Success stories abound throughout America,” the investor said. “Since our country’s birth, individuals with an idea, ambition and often just a pittance of capital have succeeded beyond their dreams by creating something new or by improving the customer’s experience with something old.” In today’s podcast, Phil and Danielle discuss a few key takeaways from Warren Buffett’s annual letter to shareholders, and why Warren Buffett and Charlie Munger are two of the most important value investors in history. Learn about purchasing wonderful companies at discount prices with this FREE guide I've created for you: http://bit.ly/3bPTyqb Learn more about your ad choices. Visit megaphone.fm/adchoices

“There’s nothing evil, per se, about selling things short. Short sellers—the situations in which there have been huge short interests very often—very often have been later revealed to be frauds or semi-frauds.” — Warren BuffettShort selling, or shorting, plays an important role in public markets as it improves prices, rational capital allocation, prevents bubbles, and shines a light on fraud. If investors think a stock's price is dropping, they can short the stock. They borrow shares and sell them with hopes of buying them back at lower prices. However, stocks can theoretically keep rising, which could cause losses. So the investors that short the stock will either have to put more money up to secure their position or close their positions. Essentially, short selling exposes which companies' stock prices are too high. In their search for overvalued firms, short-sellers can discover inconsistencies or other questionable practices before the entire market does. Short sellers can almost be regarded as the “watchdogs” of the market. A recent example of this is the Gamestop event which caused many investors to either gain or lose money, as shorting isn’t ideal for all investors. This is why it’s important to invest with your values—so you can invest with confidence and reduce your risk of making bad investing decisions.  When looking for companies to purchase, always consider the Four Ms: meaning, moat, management, and margin of safety. This is the first step you need to take when building your watchlist of companies you are interested in. In today’s podcast, Phil and Danielle discuss the important role short sellers play in our market and why it’s important to invest with your values. Learn about the Four Ms and how they can help you invest in the right businesses at the right time with this FREE guide I've created for you: http://bit.ly/3btAqhM Learn more about your ad choices. Visit megaphone.fm/adchoices

Every type of investment has its upside and downside, and some are riskier than others. Cryptocurrencies, for example, are the newest type of investment. They are unregulated digital currencies bought and sold on cryptocurrency websites. Cryptocurrencies such as Bitcoin have gained a lot of interest in recent years as an investment vehicle—some people even think it may replace gold in the future. However, cryptocurrencies remain an incredibly risky investment due to the fact that there are many unknown factors. For example, there is the possibility of government regulation and the possibility that the cryptocurrency will never see widespread acceptance as a form of payment.At this point, no one knows for sure what the future holds for cryptocurrencies, so investing in cryptocurrencies is little more than speculation. Rule #1 investors don’t invest in things they don’t know. That’s not investing, that’s gambling.On the other hand, cash and commodities are typically considered low-risk investments. So if you’re new to investing or risk-averse, one of these options could be a good place to start. However, these low-risk investments also tend to have low returns. Gold is an example of a commodity, so its price is based on scarcity and fear which can be impacted by political actions or environmental changes. If you are investing in gold, be aware that your protection against a price drop, your moat, is based on external factors so the price can fluctuate a lot, and quickly. The price tends to go up when scarcity and fear are abundant and down when gold is widely available and fear is abated. If you think the world is going to be a more fearful place in the future, then gold could be a good investment for you. Everyone’s reasons for investing and personal risk tolerance are different, so you have to decide which investment types suit your lifestyle, timeline, goals, and risk tolerance best. What a good investment is for one person isn’t necessarily a good investment for you. Listen to this podcast today for more information on your different investment options and the risk related to each.Learn more about your investable asset options with my Beginners Guide to Investing in 2021. Click here to download: http://bit.ly/37ldvE2 Learn more about your ad choices. Visit megaphone.fm/adchoices