Wealth Formula by Buck Joffrey

Why is financial education not part of our school system? To understand that, you have to understand where our school system came from. Our educational system started during the industrial revolution and was influenced heavily by the Prussian system. What do you think of when you hear “industrial revolution?” I think of factories and conveyor belts. This was a time of massive production gains in the United States and a fundamental change in the way we live. So not only did businesses need to produce more products with factories, but they also needed factories to create people to work in those factories. Schools became factories for people. Students were treated like products on an assembly line, all learning the same thing at the same pace, much like widgets rolling off a conveyor belt. The rich business owners were the beneficiaries of this system. They got a workforce ready to fit into their industries, and these workers were less likely to question or challenge the system because that’s not what they were trained to do. Despite the fact that we have moved beyond the industrial revolution into the information age, the old education system remains. Lots of standardized tests, rote learning, and teachers seen more as authorities than guides. Now, ask yourself why financial education isn’t part of our school system. It becomes pretty obvious doesn’t it? Why would a system designed to create a workforce teach them about money? After all, financial independence doesn’t exactly incentivize someone to continue working. My guest on this week’s Wealth Formula is a young woman trying to change the system. It’s clearly an uphill battle but make sure to listen and hear how she’s planning to do it. Yanely was born and raised in Brooklyn, New York and is one of the first in her family to graduate college. After two decades of school, she still can’t believe that she never had a class about making smart money decisions! Now, she’s on a mission to help young people learn about personal finance in a fun and engaging way! After completing Teach For America, Yanely paired her love for teaching with her passion for financial literacy, creating a unique YouTube channel for people to engage with topics like budgeting, managing credit, saving and investing for retirement and more! Yanely serves as the Director of Educational Outreach at Next Gen Personal Finance and is a member of CNBC’s Financial Wellness Advisory Council.

This week’s podcast is about energy. But before we do that I want to comment on a few things about our investing ecosystem. A decade ago when I first started playing around with this podcast concept I was very excited about a whole new world of investing that I was learning about. Why invest in the stock market if you could invest in real estate, oil and gas and other businesses that seemingly made a lot more money and had a lot less risk? A decade later, I can see why it often makes sense for people to just buy ETFs and call it a day. Or, maybe a highly stable asset class such as permanent life insurance i.e. Wealth Formula Banking. Private investing can be very lucrative, but it’s not regulated so it attracts all kinds of nefarious and/or incompetent characters to the space. Retail (mom-and-pop) investors are particularly vulnerable to these people because they tend to have less financial sophistication. That’s not to say they aren’t intelligent. It’s just hard to be a full-time professional and a sophisticated investor at the same time. That gets a little dangerous because personal finance podcasters like me are looking for content. We see ourselves as providing education and entertainment when in fact we often inadvertently endorse individuals to whom we should not give a platform. I have to admit that I have been guilty of this myself. Especially early on, I would interview anyone with an interesting idea without considering that my listeners might take the interview as a stamp of approval from me. For example, despite my own vehement and vocal dislike for investments in oil and gas drilling, I’ve given a platform to people on my podcast who were raising money for that. People in our community lost money because of that. For that, I apologize. In recent months, retail investors in this space have been hit especially hard. The SEC has shut down funds in the carbon capture and cannabis spaces that appear to be based in some level of fraud and other funds have simply collapsed based on poor business plans that were never attenable in the first place. Fortunately, our group was able to dodge these schemes. It’s hard enough to invest without swimming with sharks. Case in point…my real estate portfolio and that of my investor group absolutely has some losers in it right now. Much of that is due to an unprecedented slope of rate hikes and unexpected price escalations in such things as materials, property taxes, and insurance. But it’s not because of fraud. In investing, you can’t always win. You just need to win more than you lose. At the end of the day, my own investments are still going to net out quite profitably. I’ve borrowed from traditional investing paradigms and “volume-averaged” into a lot of different assets. I’ve stuck to a plan over several years that will, fortunately, overcome some setbacks and I will now position myself to be opportunistic and take advantage of oncoming distress. It will get ugly and most will be too scared to take action—especially if they have suffered losses. But that’s exactly when you want to be greedy, not afraid. But going back to how we can move forward in the safest way possible, we do need to be proactive in risk mitigation—especially when it comes to avoiding scams. So what am I going to do? 1) I will not interview anyone actively raising capital unless I am personally involved in the operation in a position of transparency. 2) Our Investor Club will only present opportunities in which I am a managing partner and/or which has undergone due diligence by a third-party SEC registered broker-dealer. In taking these steps, my podcast itself does become a little bit more challenging. As you may have already noticed, we have shifted to more macro issues than investment-related topics. However, I also believe that the steps we are taking with the podcast and with the investor club will provide our group a “best in class” retail experience that involves institutional-level due diligence. It will be more complicated and challenging to execute but that’s what you deserve. Now, getting back to this week’s episode of Wealth Formula podcast. We are going to talk about oil and alternative energy sources at the macro level. It’s information that you need to understand the larger global financial picture today so make sure to tune in! Alex Stevens serves as the Manager of Policy and Communications for the American Energy Alliance. In his role, Alex writes on the relationship between business and government in the energy industry as well as the effects of regulation and subsidies on energy markets. Alex graduated with a B.S. in Political Science from Central Michigan University and a B.A. in Journalism from Oakland University. Shownotes: Why are we still on an oil based economy? EPA story about combustion engine emissions Are renewable energy and electric vehicles as green as they seem?

What a crazy ride it’s been. Despite Covid, plunging interest rates actually made home prices explode to new highs. In my own neighborhood, housing prices doubled. Then it started to look like the housing bubble had started to burst. There were mortgage companies in distress and laid off thousands. Economists warned the next housing recession was upon us. It all made sense. How could such a wild ride not end with a hangover? But then a funny thing happened. For the last few months, housing prices actually started creeping up again. They aren’t going up by much. But the big thing is that they’re not going down. A lot of this is really due to reduced inventory. People who were going to sell their homes, most likely sold them as they saw their largest asset bubble into a pile of potential cash. With less inventory bidding wars are helping to push prices up further. In fact, Zillow predicts home prices will keep rising in 2024. Obviously a lot of that will depend on what the Fed does in the next few months. This is tricky stuff to predict. My guest on this week’s Wealth Formula podcast is using Big Data to make his own predictions.  Listen now to hear what he has to say. Mike Simonsen is the founder and president of real estate analytics firm Altos Research, which has provided national and local real estate data to financial institutions, real estate professionals, and investors across the country for more than 15 years. An expert trendspotter, Mike uses Altos data to identify market shifts months before they hit the headlines.

Last week I called the economy schizophrenic. Actually, that’s an insult to schizophrenics. This is simply a dysfunctional economy. It’s the product of a good idea called capitalism with excessive intervention—namely by the Federal Reserve Bank of the United States. Today’s economy reminds me a little bit of the movie, Jurassic Park. Altering the natural order of things has unexpected consequences… like a T-Rex eating you alive. Similarly, the Fed printed money for years and kept interest rates at artificially low levels—even when it probably didn’t need to. Sure, raising rates 10 years ago might have caused a little recession along the way, but that’s NORMAL. Instead, they decided to take intervention to a new level. Rather than seeing the role of business cycles in a healthy economy,  they became reactive to equity markets. To be clear, keeping equity markets in a bubble has never been a mandate of the Federal Reserve. But there they were.  They would threaten to raise rates, the markets would panic sell and then the Fed would quickly back off. The Fed was playing a game of chicken with investors and the investors won over and over again—so much so that people began to believe that the Fed wouldn’t ever let the markets go into free fall. Then Covid happened and, with it, something unprecedented. True helicopter money was released into the hands of ordinary Americans by the United States government. You see when the Fed prints money it lands in the arms of banks who would simply hoard it. This time, things were different. People needed the money to eat so the government put it into their hands. And that, along with high demand for goods because of a crippled supply chain lit the fire of rapid inflation—the worst we have seen in 40 years. Of course, somehow the Fed didn’t realize that it was real at first and didn’t act quickly. In hindsight, gradual increasing of rates would have made sense and probably prevented the need for extreme measures. Instead, it waited for things to get out of hand and then put its foot on the gas like never before. Now we are sort of in no-man’s land. Inflation seems to be getting under control. There is some distress in the economy as seen by bank failures and corporate bankruptcies at 2010 levels. The commercial real estate markets are a mess. But…we also added 339,000 jobs last month. Why? I don’t know other than to guess it has something to do with optimism that the Fed will change course and become Dovish with rates. In other words, businesses may not believe that the Fed will let things get that bad before they reverse course and start cutting rates. It reminds me of a spoiled child who knows that if he whines long enough his parents will give in. It’s not the kid’s fault that he behaves that way. It’s the way the parents taught him to behave. Similarly, businesses and investors don’t really believe the Fed when it says enough is enough about low rates and money printing. I’m not sure that I do either. So, that’s this non-economist’s take on what’s going on with the economy. There’s a good chance that I have several flaws in my argument but, as I’ve said before, I’m trying really hard to make sense of it so I can move forward. Richard Duncan is a real economist—one who recently spoke to Congress on what he believes needs to be done to move America ahead. He has some pretty good ideas about what’s going on with the economy now that I think will be useful to you. Listen to my interview with him on this week’s episode of Wealth Formula Podcast! Richard Duncan is the author of four books analyzing the causes and the effects of the economic crises that have brought the global economy to the brink of collapse during recent decades. The Dollar Crisis: Causes, Consequences, Cures (John Wiley & Sons, 2003, updated 2005), predicted the global economic disaster that began in 2008 with extraordinary accuracy. It was an international bestseller. The Corruption of Capitalism: A strategy to re-balance the global economy and restore sustainable growth (CLSA Books, 2009) described the long series of US policy mistakes responsible for the Crisis of 2008. The New Depression: The Breakdown Of The Paper Money Economy (John Wiley & Sons, 2012) introduced an important new analytical framework, The Quantity Theory of Credit, that explained all aspects of the global economic crisis that began in 2008: its causes, the rationale for the government’s policy response to the crisis, and likely future developments. His latest book is The Money Revolution: How to Finance the Next American Century (John Wiley & Sons, 2022). The first two parts of the book describe the evolution of Money and Credit over the last century. These include a detailed history of the Federal Reserve since its establishment in 1913 and a discussion of the transformation of our economic system from Capitalism to Creditism during the five decades since Dollars ceased to be backed by Gold. Parts One and Two show that a “Money Revolution” has occurred and fundamentally altered the way the global economy functions. Part Three demonstrates that this Money Revolution opens up unprecedented opportunities for the United States to radically accelerate economic growth, enhance human wellbeing and strengthen US national security by investing aggressively in the Industries and Technologies of the Future. Since beginning his career as an equities analyst in Hong Kong in 1986, Richard has served as global head of investment strategy at ABN AMRO Asset Management in London, worked as a financial sector specialist for the World Bank in Washington D.C., and headed equity research departments for James Capel Securities and Salomon Brothers in Bangkok. He also worked as a consultant for the IMF in Thailand during the Asia Crisis. Richard currently publishes Macro Watch, the biweekly video newsletter he founded in 2013. Richard has appeared frequently on CNBC, CNN, BBC and Bloomberg Television, as well as on BBC World Service Radio. His books have been reviewed in the Financial Times and The Economist, and taught at Harvard and Columbia. He is also a well-known speaker whose audiences have included The World Economic Forum’s East Asia Economic Summit in Singapore, The EuroFinance Conference in Copenhagen, The Chief Financial Officers’ Roundtable in Shanghai, The World Knowledge Forum in Seoul, and the CFA Society during a speaking tour around South America. In February 2023, Richard was the guest speaker at a House Ways and Means Committee policy dinner in Washington, D. C. Richard studied literature and economics at Vanderbilt University (1983) and international finance at Babson College (1986); and, between the two, spent a year traveling around the world as a backpacker. Shownotes: The Confusing Economy Will Credit Growth Push the US Into Recession? Savings and Money Supply Economy Impact of Student Loan Repayments Rethinking the Fed’s policy Wealth to Income Ratio US Current Account Deficit Macro Watch

I am annoyed with this economy. That doesn’t seem like a very professional thing to say but I don’t know how else to express my feelings any better. You see, nothing really makes sense. Inflation has been as high as it has been since the 1980s. At first, the Fed didn’t think it was real and then reacted by increasing interest rates at the fastest rate in American history. Businesses are feeling it. Corporate bankruptcies are at 2009 levels likely in response to illiquid lending markets. The commercial real estate market is paralyzed with blood starting to seep through the streets. But…last month’s jobs reports showed that we added 339,000 jobs significantly exceeding expectations. WTF? It makes no sense at all. Why is the jobs report important for us? Well, because that’s one of the variables that the Fed is looking at as they decide what to do with rates going forward. Inflation is down to 4 percent which is starting to feel comfortable, but a jobs report like that is going to give the Fed pause on being dovish going forward. So, I have no idea what to expect next. And if I have no idea what to expect then other businesses and investors are likely equally confused. And the problem with that is that uncertainty is what the markets hate the most. So…that’s where we are at and that’s why I am so annoyed. This week on Wealth Formula Podcast I interview an economist who teaches entrepreneurs. He’s written a book on how we can start looking at the economy in a practical way. His perspective is a little different than the academics who run the Fed and it will be worth your time to hear what he has to say. Listen NOW Per L. Bylund grew up in eastern Sweden’s beautiful archipelago, some 20 miles northeast of the capital Stockholm. He is currently enjoying his new professional career, as a professor of entrepreneurship, following previous experiences as systems developer and business consultant, elected politician, and entrepreneur. Bylund earned a bachelor’s degree in business administration (civilekonom) in 1998, majoring in corporate finance and accounting, and a master’s degree in business informatics in 1999, both at the Jönköping International Business School. He then pursued a career in IT and business consulting in Stockholm and Malmö working primarily with web systems development and business process automation and as CIO for companies Datastrategi, Mogul.com, WOCHB, Guide Konsult, and Nordengren Ett. Bylund is certified as Microsoft Certified Professional (four expert areas). In 1998, Bylund was elected for the municipal council in his native Österåkers kommun, where he also served as a member of two municipal boards. He held numerous positions with several political organizations for a full decade until he turned his back on party politics in 2000. While pursuing his career in IT, Bylund studied political science at Stockholm University. He later moved to Lund and earned a master’s degree in political theory at Lund University in 2005. Throughout 2004, Bylund lived in Taipei in the Republic of China (Taiwan) where he studied mandarin Chinese. In 2007, he moved to the United States to pursue a doctorate in applied economics at the University of Missouri. Graduating in 2012, he spent the 2012-2013 year as an adjunct professor teaching entrepreneurship in the Management Department of Trulaske College of Business at “Mizzou.” He moved to Waco, TX for a research professorship in the Department of Management and Entrepreneurship in the Hankamer School of Business and the Baugh Center for Entrepreneurship and Free Enterprise at Baylor University in 2013. He is currently associate professor of entrepreneurship and Johnny D. Pope Chair in the School of Entrepreneurship in the Spears School of Business at Oklahoma State University, where he has worked since 2015. Bylund has experience founding several startups between 1993 and 2006, none of which became a successful business. Failure is a great teacher, however, and the real value of these experiences is realized in his research and teaching. He currently lives in Tulsa, OK with his wife Susanne.

There is a significant amount of distress in the investor world right now. With inflation and interest rates climbing quickly, it has left the equity and real estate markets in shambles. We will get through this. And while I encourage you to fight against the fear of investing so that you can take advantage of oncoming blood in the streets, I understand if you are reluctant. We’ve had tough times in American economic history. The Great Depression of the 1930s was a period of extreme economic hardship and uncertainty. It started with a stock market crash on Black Tuesday, October 29. The Dow Jones Industrial Average lost about 12% of its value that day. The crash continued into the following weeks. By mid-November 1929, the market had lost over $30 billion in value (approximately $400 billion in today’s terms). This loss of wealth led to reduced consumer spending and investment, which in turn led to job losses and business closures.  Real estate prices also fell significantly during the Great Depression. Many people were unable to afford to keep their homes or buy new ones, leading to a surplus of available properties and a corresponding drop in prices. However, life insurance companies displayed a surprising level of resilience during the Great Depression. While it was a challenging time for these companies, as it was for the entire economy, they weathered the storm better than many other types of businesses. For this reason, an entire generation of individuals put a premium on permanent life insurance as an investment. It was all they had left once the dust of the Depression had settled.  Nevertheless, the next generation of Americans forgot about the depression and the value that permanent life insurance had played in their parents’ survival. Even with insurance strategies that significantly increased investor returns, financial advisors focussed on their personal AUM continued to treat it like a red-headed stepchild. As you may know, I am an advocate of permanent life insurance, specifically overfunded type policies such as Wealth Formula Banking and Wealth Accelerator. They have been a source of profitability and stability for me. Even in times like now where my portfolio has taken such a beating, I can count on the insurance portion of my net worth. As I thought about that last week, I decided to bring it back on your radar so I invited our insurance partners back to the show. If you haven’t yet secured permanent life insurance as part of your portfolio, you will want to make sure you listen to this week’s episode of Wealth Formula Podcast. Rod has been in financial services since 2009. Prior to going into business for himself, he worked in marketing and finance with several small businesses. He had the opportunity to purchase an existing furniture business in 2007, just prior to the Great Recession. The experience of struggling to stay afloat amid difficult economic conditions inspires Rod every day in his efforts to educate and assist his clients in implementing sound financial strategies. He strongly advocates for establishing a firm foundation, utilizing proven strategies and financial tools to create a strong base upon which we can each build our financial house. In addition to focusing on Wealth Formula Banking and Velocity Plus, he has expertise in retirement income planning. Rod has a bachelor’s degree in Marketing Communications, and an MBA with an emphasis in Entrepreneurship. He and his wife Jodi are the proud parents of 7 wonderful children. As a family they thrive on spending time exploring nature, playing games and doing projects together. He enjoys sports, music and reading. Brenyn started in the finance industry in 2019 after he graduated with a bachelor’s degree in Marketing with a minor in Management from Utah Valley University. While Brenyn was in school, he managed a sales team in New York and Connecticut for 3 years. He learned while training, mentoring, and leading more than 75 sales reps that most of his reps had very little financial education. This ignited Brenyn’s own financial education and is what ultimately guided him into the financial industry. Brenyn started at a finance firm in Salt Lake City and quickly built his own practice with the same ideals and strategies that we believe in. Naturally, this led to a great fit between Brenyn and the Wealth Formula Banking team. He joined the team in 2020 and helps facilitate the education, implementation, and ongoing strategic review efforts of our clients. He is also our resident expert in disability income insurance. Brenyn enjoys furthering his education in the alternative investment space through books, podcasts, and webinars. He has been married for 5 years to his wife Aubri, and they enjoy boating, camping, and traveling. Shownotes: How did the concept of permanent life insurance come into existence in the first place? How did global events such as world wars, economic depressions and pandemics have impacted the insurance industry? Indexed Universal Life vs. Variable Life Insurance Wealth Accelerator

With rising interest rates, I keep getting questions about whether value-add real estate is dead.  The answer to that question is a firm no. Remember, people have made money and lost money in all kinds of interest rate and cap rate environments. The interest rates we have right now aren’t even close to the highest they have been in the United States. So why is there so much distress in the real estate market and all other correlated markets then? The biggest problem that the Fed has created for us is that they did not react to inflation fast enough and so it got out of hand. They ended up having to play catch up and raise rates at the highest slope in American history. All markets hate instability and extremely rapid rising rates wreak havoc on all of those markets that we typically rely on for investments including real estate and equities. This is particularly problematic for floating rate scenarios and for businesses that need liquidity. Banks don’t like to lend when rates are moving up quickly. The truth is that I don’t know anyone who hasn’t lost money during this period of time—whether that be in real estate or stocks. That doesn’t mean it feels good although misery does love company. The key, as I will continue to emphasize, is to be prepared to mentally cut against the grain of fear. Investing money while you are down is extremely counter-intuitive to the human psyche.  Fear is designed to protect us. If you were running from a lion, you wouldn’t be inclined at that moment to consider how you might avoid running into one in the future. You would be focused on the danger at hand. That reaction of focusing only on the danger might be useful in the wild. But when it comes to investing, it could prevent you from keeping your eyes out for great opportunities. While they might not be here yet, be prepared mentally. These are the times when investors with ice in their blood make a lot of money. Use this time to get the rest of your house in order. Get your asset protection and estate planning in place. Start learning about other sectors. The truth is that there is almost always something to invest in if you know how. How about tech? How much do you know about artificial intelligence? Probably not much. I don’t either. But it’s clear that this is going to be life-changing technology for better or worse so maybe we can make money off of it. Today, we are going to spend some time talking to an expert in artificial intelligence. I urge you to listen to this episode. I learned a great deal and it opened my eyes to its potential. Listen HERE After starting his business in possibly the worst year for financial markets i.e. 2008, Shashank Shekhar has led the company to be one of the fastest-growing mortgage companies in America by helping thousands of families secure better financing for their homes. In 2017 and 2021, InstaMortgage Inc. (formerly known as Arcus Lending Inc.) was named to the Inc. 500 list of the fastest-growing private companies in America (aka “Most Exclusive Club in Business”). The company was also named to the 2021 Deloitte Fast Tech 500, ranking higher than household names like Zoom, Pinterest, and Square. This dramatic growth has been built on the pillars of legendary customer service and an unrelenting focus on education. Shashank lives and breathes the mantra “We are in the customer service and education business, we just happen to do mortgages.” Amazon.com #1 best-selling author Shashank was named “2022 & 2023 Entrepreneur of the Year” by Stevie Awards. He was the expert guest of the TV and radio show – “Mortgage Matters” and the author of widely acclaimed books – “First Time Home Buying 101”, “Real Estate Unleashed” and the latest #1 best-seller “My First Home”. Besides writing one of the top mortgage blogs in the country, Shashank also gets invited to blog on several of the top websites and gets frequently quoted in national and international media. He was interviewed by Emmy Award-winning director Nick Nanton on his TV show. He is the host of “Shashank Redemption” podcast where he talks about entrepreneurship, startups, and FinTech, In September 2020, Shashank led his team to create, Rachel, the world’s first digital human in the mortgage industry. Shashank is also a regular on the speaking circuit with frequent keynote talks at Mortgage, Real Estate, and Small Business events. Shownotes: What is Artificial intelligence? ChatGPT’s accuracy What is going on with AI and real estate? InstaMortgage.com

This week’s Wealth Formula Podcast features me trying to answer your questions. Make sure to tune in as I try to answer questions about interest rates, the state of value add real estate and Central Bank Distributed Coins! Listen HERE

Joe Biden says the economy is “strong as hell” but he’s wrong. Interest rates increasing at the steepest slope in history over the last year have caused a serious problem for the economy and hell is about to break loose. I’m not the zombie apocalypse type but I have seen some shady-looking dead people walking around with silver dollars in my yard and I am a little concerned. Bankruptcies are up 216 percent on the year, higher than the 2008 crisis and double that during the Covid lockdowns. This is before a recession has even been declared. Banks aren’t lending. Much like they did in 2008, they are sitting on bailout money. Not only does this cause bankruptcies but it also keeps healthy companies from thriving. The Federal Reserve has really screwed us and it could take a while before we dig ourselves out of the impending mess. It doesn’t help that the current administration appears blind to the problems that we face. We as real estate investors are not immune from the carnage. We rely heavily on debt and those rates have made the markets illiquid and have significantly affected property values. So we need to come to grips that there is a good chance many of us are going to lose some money soon. I know I have already. But it is important to put things in context. The ride up has been fun. Anything people bought and sold between 2009-2021 invariably was a win. But that’s not how markets work. Everybody loses sometimes. The key is understanding that to get ahead you have to win more than you lose. That means learning lessons when you lose and also not giving up. In other words, just because you lose some money in this market doesn’t mean you don’t prepare yourself to take advantage of the same set of facts on the buy side. That would be a mistake. Nothing that happens in the next year is going to kill you. Don’t lose sleep over it. This too shall pass. My guest on Wealth Formula Podcast this week has thought and written a great deal about the psychology of investing and retirement. Listen to this interview as it may help you to navigate the headwinds before us. Emily Guy Birken is a finance writer who writes the “Live Like a Mensch” column for The Dollar Stretcher. She is also a contributor to Wise Bread, PT Money, Money Crashers, Yahoo! Finance, and Business Insider, and many other personal finance sites. She edits and writes for the FinCon blog, an annual conference for financial bloggers. She is the author of The 5 Years Before You Retire, Choose Your Retirement, Making Social Security Work for You, and End Financial Stress Now. You can visit her at SAHMnambulist.blogspot.com.

I was a surgical resident for years. I started out as a neurosurgeon, moved over to Otolaryngology Head and Neck Surgery then ended up in cosmetics. During my training, it didn’t matter how much I worked. I would always get the same paycheck. I wasn’t lazy but I certainly didn’t enjoy working for what amounted to minimum wage. And I was not about to volunteer for any more work than I was assigned. Eventually I did finish training and I was hired by a facelift company. I know it sounds kind of weird but they would recruit patients with questionable marketing tactics and hired an army of young surgeons to do the work. I got paid about 15 percent on revenue I generated for the company. They didn’t charge as much as your typical facelift surgeon, but because I was doing 3-4 facelifts a day, it turned out to be really good money. For reference, my most recent job was as a chief resident in San Francisco for which I was paid $50K per year (that’s poverty in SF). The day I became a capitalist was the day I got my first real paycheck.  In two weeks, I made more than I did in my entire surgical internship year. It blew my mind. Suddenly I realized that the harder I worked the more money I could make. And that made me work really hard! Suddenly, I was more than happy to put in long hours. I enjoyed doing the procedures and I was good at it. But I also liked the idea that my work was getting proportionally rewarded with dollars. There was a noticeable change in my spirit. Even though I didn’t own the place, I cared about the office and wanted to make sure we were doing a good job. I took ownership and that mattered. After all, in the history of the world, no one ever took a rental car to the car wash. Of course, like all entrepreneurs, I eventually realized that there was an even better way to make money than getting paid for the amount of work I did for the business—own your own business.  I went on to start multiple businesses and the rest is history. But the moral of the story is that opportunity for those who have talent and work hard is endless in our country and getting paid for the first time gave me my first taste of that. Anything that threatens that reward system threatens the very core spirit of who we are. Of course not everyone shares my views—especially these days. And it’s not always as simple as perhaps I make it sound. We still need to take care of people in need and we still need to provide opportunity for the underprivileged. This became even more evident during Covid when people simply couldn’t work. But I fear some of the remedies of a difficult time have permanently altered our culture. After all, it is difficult to take things away from people after you give it to them. My guest on Wealth Formula Podcast today was right in the middle of policy making during the Covid crisis and was making decisions like what to do about people who couldn’t pay their rent. What makes his perspective interesting is that he is a libertarian who works for a libertarian think tank. Find out how a small government guy navigated the biggest government intervention in American history on today’s economy on this week’s Wealth Formula Podcast! Mark A. Calabria is a senior advisor to the Cato Institute. He provides strategic input and direction on the federal economic policymaking process. He previously served as director of financial regulation at the Cato Institute, where he cofounded Cato’s Center for Monetary and Financial Alternatives. Calabria is the former director of the Federal Housing Finance Agency, which regulates and supervises Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. During his service at the agency, Calabria led the response to COVID-19, as well as laid the groundwork for a removal of Fannie Mae and Freddie Mac from government conservatorship. Prior to his heading of the Federal Housing Finance Agency, Calabria served as chief economist to Vice President Mike Pence. In that role, he led the vice president’s work on taxes, trade, labor, financial services, manufacturing, and general economic issues, including serving as a key member of the team that enacted the Tax Cuts and Jobs Act of 2017 and on the team that crafted the United States‐​Mexico‐​Canada trade agreement. Calabria served as the vice president’s primary representative for the U.S.-Japan Economic Dialogue. Calabria served as a senior aide to the U.S. Senate Committee on Banking, Housing, and Urban Affairs under chairs Richard Shelby and Phil Gramm. During his Senate service, he acted as the primary drafter of the Housing and Economic Recovery Act of 2008, which established a stronger regulatory framework for the government‐​sponsored housing enterprises. He also led the banking committee’s response to Hurricane Katrina, as well as its work on the Shelby‐​Dodd Flood Insurance Reform and Modernization Act of 2008, which served as the basis for the Biggert‐​Waters Flood Insurance Reform Act of 2012. Prior to his Senate service, Calabria served as the deputy assistant secretary for regulatory affairs in the Office of Housing at the U.S. Department of Housing and Urban Development. Calabria has also held positions with Harvard University’s Joint Center for Housing Studies, the National Association of Realtors, and the National Association of Home Builders. He holds a doctorate in economics from George Mason University. Shownotes: Risk-Based Pricing in Financial Services The Importance of Credit Scores Limitations of Landlord-Eviction Pause The Soundness of the Banking System Market Caution and Investment Opportunities Federal Reserve Actions and Inflation