March 27, 2025 • 53 mins
In this episode, John breaks down important terms in today's economy. You won't only get a clear definition of the words, but you'll better understand the state of our current economy and how we got here.
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Speaker 1 (00:00):
Speaks to the Plannet.
Speaker 2 (00:01):
I go by the name of Charlamagne the God, and
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Speaker 1 (00:45):
Welcome the Money in Wealth with John O'Bryant, a production
of the Black Effect Podcast Network and iHeartRadio. Hey, Hey
is John Hobryant And this is Money and Wealth on
the Black Effect Network. iHeartRadio and I want to thank
(01:09):
everybody for continuing to support. The podcast is growing very rapidly.
It just shows that you want to understand how this
stuff works. We want to go from civil rights marching
in the streets to cutting business deals in the suites
the ownership class. Can I get an amen? This is
my pulpit of finance. So this week I'm going to
(01:31):
break down how the modern economy works. This is what
they never taught you in school. Like you're not dumb
and you're not stupid. Is what you don't know that
you don't know is killing you. But you think you
know and you're too ashamed, too embarrassed to ask questions.
Are you're just too busy. You're just moving and grooving
(01:53):
and trying to make a living and a life. You
got too much month at the end of your money.
You know, you're trying to live this life holding complete
and you're doing the very best you can, and I
commend you for that. You're trying to raise your family,
trying to build a family, trying to build a life. Meanwhile,
no one's ever taught you how this system works, and
people expect you to figure it out. For yourself, and
(02:14):
they throw all these terms at you and expect you
to understand what the heck it is. And I don't
know why, because literally no one's taught you. So I'm
gonna break it down for you in this episode. I'm
going to unpack the basic stuff that you need to
know to navigate in this world and to understand the
(02:36):
terms right now in early twenty twenty five that are
being thrown at you with some presumption. So let's get
at it, and then I'm gonna leave you with some
helpful tips of what you do to maneuver to manage
yourself successfully in this environment. All right, So again, there's
(02:57):
nothing wrong with you in not knowing right out of failure.
You may have had a feled experiment, but that's just
the result of you trying. I rather you try and
slip and fall and never try at all. So it's
what you don't know that you don't know this killing you.
But you think you know and others presume you know,
and I'd rather you master the class. So this is
(03:21):
a master class. Here we go terms to break down inflation, recession,
interest rates, tariffs, GDP, stimulus and relief packages. The federal
(03:50):
reserve system. They call it the FED wage growth versus
cost of living, supply chain, unemployment rate. There are some
items I'm gonna spend more time on than others. I'm
gonna cover some of these, just gloss over them. But
(04:10):
I'm gonna spend a little bit of time on a
couple of these items in particular because they relate to
the current situation. All right, Inflation, what is it? In general?
Inflation is where everything just costs more and you can't
(04:35):
quite figure out why it costs more. The background of
inflation in the modern description we're gonna talk about here
is tied to COVID. So let's first start with what
is inflation. Inflation is when prices go up across the board.
(04:56):
I mean groceries and as we now know, eggs, gas, rent,
everything just seems to be going up, certainly at a
higher rate than your income, and is dang on frustrating.
Folks got too much month at the end of their money.
Seventy percent of this country, seventy percent of the economy,
and the biggest economy in the world, the United States
(05:17):
of America, is consumer spending seventy percent, right, and seventy
percent of Americans So seventy percent of the economy, biggest
economy in the world's consumer spending, and seventy percent of
Americans are living from paycheck to paycheck. Not black people,
not brown people, everybody. And whether you're white, black, red, brown, yellow,
(05:38):
you want to see some more green, can I get
me amen? So, if inflation is when prices go up
across the board, it means your dollar doesn't go as
far as it used to. Now, why does this happen?
At its core, it's basically too much money racing too
(06:00):
few goods. We call it supply and demand. When demand
is high, supplies low, prices rise. Why is COVID important
in this conversation? And why do I say it's all connected?
I mean, people want to blame this stuff on US
presidents and all this kind of stuff, And really that's
(06:24):
a false flag because of a virus probably created in
China unleashed. And I think I shouldn't say this, but
I wouldn't be surprised if someone, some elements unleash this
intentionally in order to trip up the biggest economy in
(06:45):
the world, to try to take an advantage, to get
an advantage on the US, to leap fraud over US
to slow us down, use our freedoms against us. That
didn't work, but I wouldn't be surprised if it was
not intentional. China's at war with the United States. I'm
going to do a whole piece on Africa and China
(07:05):
as a separate podcast, but I'm trying to give you
some practical stuff that you need right now before I
start giving sort of macroeconomics and global economy stuff. So
just staying very focused. COVID was a reaction to something
not created here. It was created. It was a virus
that that literally stopped the US economy, stopped it and tracks.
I've already told you the biggest economy in the world
(07:28):
is driven by consumer spending. And then consumers were not moving, grooving, rolling, operating.
I mean we were all locked literally for a while,
locked into our homes, lockdown. The whole economy just basically
grind ground to a halt. So the US economy nearly
shut down to avoid a depression. I'm going to define
(07:48):
a depression in a moment, the government and the Federal
Reserve pumped over eight trillion dollars into the economy. Okay,
just to put this into context. Ever, in the history
of the modern world, has a government ever put a
trillion dollars into a stimulus I'm explained that at the
(08:11):
moment into the U into any economy, not just the
US economy, any economy in the world. There's never been
a trillion dollars of real money, I mean like fun
money or funding money, or some third world countries, real
money of a major currency invested in its economy. That's
how bad this was. And it wasn't one trillion or
(08:31):
two trillion, or three or four or five trillion or
six trillion. It was over eight trillion dollars. You can
bind what the Federal Reserve did and what the Congress,
bipartisan Republicans and Democrats, okay, and a Republican president Trump
and a Democratic President Biden did right to keep the
(08:57):
US economy from absolutely stalling, so to avoid a depression,
which is different than a recession, it's worse. Again explaining
that in a moment, to avoid a depression, the government
in the Federal Reserve pumped over eight trillion dollars in
the economy. That money came from one government stimulus spending.
(09:17):
That's Congress, okay, bipartisan meaning both parties. So anybody explained
wants to blame this on Democrats or blame this on
the Republicans alone, It's just dead wrong. It was by partisan.
Both parties realize how bad this was, and Republican and
Democratic presidents both did their own versions of what I'm
(09:38):
about to tell you. Direct checks to individuals three rounds,
twelve hundred dollars, six hundred dollars, and fourteen hundred dollars.
You probably know these numbers because you probably received a check. Okay.
There was some misinformation that this money was directly a
result of one of our former presidents because he had
(09:59):
his name on him. No, he just directed I think
the US Treasury Department, but I'm correct to put his
name on the checks. But the money came from Congress. Okay.
Expanded Unemployment Benefits was the second version of what is
included in the stimulus. The third perst portion you would
recognize PPP loans. There's a lot of fraud tied a
(10:21):
PPP loans that people are going to jail right now.
And small business Assistance, rent and mortgage relief was the
fourth element, and child Tax Credit was the fifth element. Okay,
So this is the government stimulus spending through Congress first
(10:42):
part of the stimulus. Now, the purpose of this was
to keep Americans and businesses afloat while the economy was frozen,
so we didn't go into a depression. Number two Federal
Reserve actions. This is now two thousand year two thousand
years two. I don't if anybody's ever explained this to you.
I'm explaining, I'm explaining it. I'm unpacking it, hopefully in
(11:07):
ways that everybody can understand. Spread this to your friends,
tell everybody to go back and listen to this. I
am explaining to you where inflation came from, what happened
during COVID, how transformation really if now I'm going to
be I guess political, if you want to are I'm
going to be deeply opinionated here for a moment. If
President Biden's advisors were really, really on top of it,
(11:30):
they would have told him to run for one term only.
You're going to fix the economy, You're going to get
America back on track, you're going to check all the boxes.
You're going to drop the mic, bounce and leave. That
would have been I think a brilliant piece and a
great legacy for him. I think he just stayed too long.
Power is very intoxicating. I understand it, and he wanted
a second term and all that kind of stuff, but
(11:53):
he did the Biden This is not a partisan comment.
I've advised three presidents from both parties. Biden Harris administration
did stabilize the biggest economy on the planet and kept
it from going over the cliff. That plus a Republican
(12:14):
and Democratic Congress working together, That's just a fact. Got
no credit for it because I think they're horrible marketers
and horrible communicators of their successes. And then some people
even talked about how this are socialists. We're not a
socialist country, We're a capitalist country. Right. I'll do a
(12:35):
separate podcast explaining what socialism, communism, capitalism, all these things are.
Most people just I'm convinced and financially illiterate. But even
if you want to destrud money like a socialist, you
have to first collect it like a capitalist. Can I
get an a man? And as I keep saying, people
say they hate rich people, Oh you don't you hate
(12:56):
rich people until you become rich. What you hate is
a game system. Right, I'm trying to ungame the system
for you by explaining it to you and giving you
the rules of the game. Financial literacy, which I believe
is the civil rights issue of this generation. So you
know better, so you can do better. The second part
of the stimulus package was the Federal reserve actions. Number one,
(13:18):
they dropped interest rates to nearly zero to encourage borrowing
and spending to keep the party going. Two, they bought
trillions of dollars in bonds to inject cash into the system. Ok.
Number three, they supported financial markets to prevent collapse. This
put an artificial floor on the value of Wall Street stocks,
(13:44):
which meant that the value of stocks had no choice
really than to go up. So now this is contributing
to inflation because now you're inflating the value of cars,
inflating the value of art, inflating the value of real estate,
inflating you know, you name it, right, stuff, you're trying
(14:05):
to go buy stuff, there's not enough of it, and
the federal reserves keeping the markets from collapsing, so you
think you're getting richer because the government is subsidizing really
the whole situation. So in the short term effects it worked, right,
There was massive economic collapse that was avoided. People had
(14:28):
money to spend, businesses stayed open, jobs came back, the
stock market and the housing market boomed for the reasons
I just mentioned. You may have to go back and
replay some of what I'm saying, so it all sort
of locks in. But your heads should be nodding now,
going yeah, okay, okay, I get it, I get it.
(14:48):
Long term effects of these two actions inflation. All that
money flooded the economy. At the same time, supply chains
were broken, which means factory shut down, ships shipping, backed up,
(15:14):
labor shortages. The shipping companies were gouging companies for shipping bins.
I mean, it was just everybody sort of pump pimping
the system back. Then supply and demand not enough supply,
too much demand, prices go up. Combine that with all
(15:34):
this money flooding from the federal government, there's just too
much grease on the gears of the economy. It flooded
the engine. The result was more money in people's hands
plus fewer goods on shelves equals prices spiked. Did you
get that. I know you're smart. You made to repay this,
replay this and play it back again. Inflation hit forty
(15:56):
year highs between twenty twenty two and twenty twenty. That
was nobody's fault. It was either that or the economy
was going to implode. Now, was there too much stimulus? Probably?
In fact not probably. There's probably a tree and a
half dollars at least of too much stimulus. But let
me ask you this question, where's a stimulus where's the
pandemic manual? You pull off the shelf. If you're the
(16:20):
Federal Reserve chairman, or the President the United States where
or or Congress or whoever you're some you're some economists,
where's the man You pull off the shelves and go, yep,
this is exactly the amount of stimulus you need in
order to keep the biggest economy in the world from imploding.
There's not been a pandemic of this size since the
Spanish flew one hundred and twenty five plus years ago,
(16:41):
so there was no manual, and that was before the
Federal Reserve was creed and created. All right, So this
was just winging it. And it's better to put too
much oil on the gears than to starve the engine
from oil, and the engine seizes up. So you don't
want to be the guy sitting at the control booth
in the economy for the biggest economy in the world,
and the democracy collapses because you you didn't put enough
(17:04):
energy into it. So they put too much energy into it.
They overdid it probably by twenty percent, maybe twenty five percent, right,
and that has created sustained inflation that's not been seen
since in forty years. The Fed then had to slam
the brakes on raising interest rates by raising interest rates
(17:24):
aggressively to cool things off, so they hit interest rates
down to zero right to flood to create more activity,
and then to slam the brakes on that activity, they
raised interest rates, and people thought interest rates were just
way too high, But in reality, the interest rates of
five to six percent are pretty dang on good. It's
(17:45):
just we were used to for the longest time we're
listed form like a decade, used to interest rates one, two,
three percent, and then for a minute it was zero.
So we got spoiled. This generation got spoiled. But that's
not the reality. The real time impact today, higher prices
at the grocery store, the gas pump, rent, credit card
(18:06):
interest rates at historic highs, harder for people to buy homes, cars,
or borrow money. Okay, because the debt. The income ratios
are higher because interest rates are higher. I had one
line of credit that had a balance of It was
a million and a half dollars or something, and it
(18:28):
was a floating interest rate. And when interuest rates were
very low, I was paying like twenty five hundred dollars
a month in interest payments. I was like, oh, I
love this. But when interest rates went up, the monthly
payment was ten thousand dollars a month. Now, luckily I
can afford that. But that's a four x increase an
interest expense, and that happened to everybody, right, whether you're
(18:51):
wealthy or not. That hurts. The aftershocks of trillions of
dollars in emergency spending is still being felt today. Here's
the bottom line. The eight trillion dollars saved us from disaster,
but now we're paying the price in the form of
inflation and higher interest rates. Understanding the trade offs that
(19:13):
trade off of these things help people navigate, well, help
you navigate actually the economic realities of today with clear eyes.
Now let me back up and go back to breaking
(19:36):
down these different things. So now I've in the first
twenty minutes of this podcast, I've solved the biggest problem
for you. Now you can go talk to your friends
and be like I think, I keep saying, we need
to make smart sexy. We've been making dumb sexy for
way too long. We've dombe down and celebrated it. It's
time to make smart sexy again. Now you're going to
(19:57):
be the sexiest person at the cocktail party. Here are
hanging out with your friends because now you can explain
something that nobody understands. You can explain it. You can
explain inflation, Where did it come from, who's responsible all
of us? And and how long is it going to last?
A while? Right, But it's not a boogeyman anymore. It's
it's just the facts jet recession, what it actually means,
(20:23):
and why it sparks fear. Well, why what it means
and what it doesn't mean? Why does it spark fear?
Let me explain now, recession versus a depression. A recession
is a temporary economic decline where the economy shrinks negative
GDP growth for at least two consecutive quarters six months.
The key signs of recession slower economic activity. We're seeing
(20:46):
that right now in the economy, rising unemployment. You've seen
right now in that right now in the economy, decline
in consumer spending and business investment. You're seeing that right
now in the economy. Lower company profits. You're about to
see that in the economy. Sometimes triggered by inflation or
high interest rates. We're seeing both of those in the economy.
(21:08):
So thinking of it like this or the economy is
catching a code, it's serious, but it's usually short term.
If we experience a recession in twenty twenty five, and
I think there's a twenty five percent chance of it
and increasing, it's man made. It's it's intentional. It's well
not intentional. It's there is a bet being made in Washington,
(21:29):
d c. On economic policy that if I guess they
believe it's right, then I mean, I don't. I'm not
get in their heads. But if they're wrong, I can't
tell you about whether they're right. If they're wrong, it
could trigger a recession. Now, I think the economy is
basically strong, which is the bones' economy is basically strong.
(21:50):
It's not. This is not like two thousand and eight,
So we can recover quicker than we otherwise would, but
we are this is a if we have recession, it
is a man made recession. Here's what it's not. Is
not a depression. Here's a depression. Okay, not, you're depressed.
(22:11):
I'm talking about an economic depression. A depression is a
prolonged and severe recession that lasts years instead of six
months or less, with massive unemployment, deep declines in economic output,
and often a breakdown in financial systems. That's what have happened.
There wasn't the stimulus of two thousand to twenty twenty two.
(22:32):
The key signs of a depression GDP plunges dramatic, drastically,
unemployment hits double digits and stays high, wide spad poverty,
and bank failures, long periods of recovery, often a decade
or more. Now, what's an example of a depression? The
Great Depression nineteen twenty nine into the late nineteen thirties.
(22:54):
In fact, it took World War two and the spinning
tide to that of the government into the private sector.
That that was what actually shook us out of the
Great Depression. That wasn't this nineteen thirty nine nineteen forty
unemployment hit twenty five percent back then, the stock market
and lost nearly ninety percent of its value. Think about
(23:14):
that that was the Great Depression. Think of it like this,
the economy on life support, deep, painful and long lasting.
That's not what we're dealing with, right, So you can
check that box and remove that from your thought process.
Now let's deal with interest rates. I think I've covered
(23:35):
this to your satisfaction, but if you if you don't
know why interest rates are important and how why I'm
upsessing about credit scores. The higher your credit score, the
lower your interest rate. Right, The lower your credit score,
the higher your interest rate. It's almost in direct proportion
if you don't pay your bills, if you know you're
(23:55):
going to have if you're not responsible about your fiscal situation,
you have really crappy credit score. I've been there, and
you're going to pay a very high interest rate. Those
who those who make the least pay the most, certainly
if you don't manage your financial but frankly, it's not
just the poor. The poor pay the most, but generally speaking,
(24:16):
but if you're wealthy and don't pay your bills, same
it is also true. If you're wealthy, don't pay your bills,
you will have a crappy credit score. Anyway, that's what
interest rates are, and again, I covered that a minute ago,
so you know, back and listen to that. I'm trying
to get through a lot of ground in one podcast tariffs.
I love this conversation. Okay, so what the heck is
(24:37):
going on with tariffs? A tariff is a tax, Okay,
not an attack. It's a tax. Well maybe an attack too,
and it is a tax on the recipient, the buyer
of goods is not. So if we have a tariff
(25:00):
on China, or a tariff on Canada, or a teriff
on Mexico, this is not saying, oh, Mexico, we're gonna
make you paid, Canada will make you pay, Texas, Texas, China,
we're gonna make you pay. No, if you're the CEO
of a major retailer in America and you're buying products
from let's say China as an example, you're paying. The
retailer's paying, so they're paying the tax. The tax goes
(25:25):
to the federal government. So the federal government is theoretically
making some money, but it is not. This is I
don't think this is money that's worth it, because the
trade off on that is could be catastrophic if you
don't play it properly. What did I say seventy percent
of the US economy is consumer spending, right, And we've
already seen what happened when you when you stressed out
(25:45):
the consumer economy in COVID. So, a tariff is a
tax that is paid for by the buyer of the goods,
whoever that buyer is. Follow me here, now, what is
that buyer going to do in the natural scheme of things,
(26:06):
unless they just are making a crap load of profit
or somehow being offset by a credit by the federal government,
which that's not going to happen. The federal government is
actually trying to take the tax as revenue for the
federal government in this example. But that manufacturer, sorry, that
that manage, that importer is going to in all likelihood
(26:28):
pass on that cost to you, the consumer. What is
that going to do with your cost of goods? Raise them,
raise them? Sorry? In most situations that that the retailer.
I won't pick an I'm not gonna pick on the retailer.
It doesn't matter which one it is. If there is
a if there's a tariff on what they're buying from
(26:51):
China in this example, it will raise the cost of
that thing because they got to pay a tax on
it to the government. That means they got to pass
that in order to be profitable. They got to pass
that raise the costs from a buck to a buck
twenty five in this example, and pass that cost on
to you the consumer, and if the consumer has too
much month at the end of their money. Hello, okay,
(27:13):
So why does somebody why does a politician use a terraff?
They're trying to, in all likelihood to negotiate with the
company because there's trade and balances company the country that
they're putting the tariff on, because that means there's less
demand for that country's goods because the buyer is less
incentivized to buy the product from that country. So they're
(27:34):
trying to negotiate with that country by penalizing that country
with less demand of their goods. I hope this is
making you some sense. You can replay this if you
need me to slow this down for you, and I'm
explaining to you why I don't think it's going to
work in this example. So in the short term, you
can use this as a negotiating tool to extract what
you want politically from your adversary who you're trying to
(27:58):
hit over the head with this paroff to get them
to do what you want them to do. The secondary
reason you might want to do this is to make
goods that are foreign less cheap, less attractive than homemade goods,
(28:19):
and so that you're quote being bringing manufacturing back home.
Please in the comments, tell me whether when you see
this on social media, on YouTube, whatever, as a podcast
gets shared, let me know whether this is where I'm
doing a good job of translating this. It's really important
you get this. So I've just told you there's a
political reason to do tariffs, and then there is a
(28:42):
a bring back home manufacturing so that the homemade goods
are cheaper than the foreign goods rationale for doing this. Okay,
can tariffs work? Yes, if you extract, if you set
a tariffs and you make it short term, and you
(29:04):
make it definitive, then it can work. But you've got
to make sure you've got a strong economy. You got
to make sure you have all sets so that the
average every day American doesn't get whacked over the head
when this is going on, which means you need to
be very thoughtful about it. It needs to be really thought out.
So hold on to that for a minute. What's happening
(29:25):
now is it's the tariff today, tariff's off tomorrow, the
tariffs ten percent, tariffs twenty five percent. It's up is down,
as left is right, it's it's how do I feel today? Well,
that I don't think is as elegant a strategy and
may not be sustainable. And it's combined with the second
problem of here here. And I'm not being critical. I'm
(29:46):
just I mean, we need the we need our com
froment to be successful, so I'm rooting for them. I
just don't understand this particular strategy, and I don't think
it's well advised. Let me just say that for the record,
let me give you the big drop the mic. In
order for teriffs to work, where you're bringing manufacturing back home,
which is one of the talking points you would have
(30:10):
had a year before you became president, met with all
of the major banks and all the major capital providers, financiers,
all the major fortune five hundred company CEOs and said, look,
if I win, when I win, I'm going to be
bringing manufacturing back home. I'm going to be putting tariffs
in the following areas, and I need for you to
plan for that. I need for you to go to
(30:31):
your Board of directors, go to your governance committees, governance
committees of your board. I need you to go to
your shareholders, your investors, and tell them that we want
to allocate We want you to allocate capital in your
industries to build factories, you know, to create jobs in
all these different places. And by the way, this could
have worked and combine that with the Biden infrastr seventy
(30:53):
thousand Biden infrastructure projects, roads, bridges, etc. That are and
that all together create a bunch of jobs, and then
we're going to bring manufacturing back home. Theoretically that could
have worked. Two problems with that one. That didn't happen. Right,
nobody mad with anybody it made any long term plans.
(31:14):
I know because I'm talking to these CEOs. No one
this is all new news to them. They're finding out
on Twitter or ex or whatever. It is, just like
everybody else. So what the policy is, and you cannot
No one's going to allocate millions, tens of millions in
some case billions of dollars and bit tens of billions
of dollars in some cases for automobile manufacturers or steel
plants whatever. Just because somebody sends out a tweet today
(31:36):
and says that they're they're changing policy overnight. They just
can't pivot on a dime like that. Doesn't matter whether
they like it, don't like agree, or do disagree. You
just can't move that fast, particularly when you wake up
the next day and the policy is changed again. Uh So,
(32:00):
one they didn't have the chance the time to allocate
the capital. And two we're not a manufacturing country anymore,
not for heavy you know, traditional goods. We're too expensive.
The country took expensive of that that that party left
us that you know in the late seventies and eighties.
That does a game for developing nations where it's cheaper
(32:21):
to do it. Here's the other problem. Even if you're
manufacturing something at home that's not technology based or there
are some things we do do well knowledge based stuff.
But if you're manufacturing traditional stuff here, the parts of
that thing. Let's take an automobile as an example, are
often imported. Even if you manufacture the thing here, you
still need parts from other parts of the world, which
means we're still interdependent. Okay, so this is not this
(32:46):
is this is not designed well, in my opinion, to
work and that is why I think you're going to
see tariffs create an increase in prices for you and
short term until you know, they run the course of
this experiment, and hopefully this will stop sometime soon because
(33:08):
I think it's going to slow down the economy and
cause more pain to the average consumer. Let me know
if I explained that well, number five, so I've got
done tariffs number four. I'm gonna run through the rest
of them pretty quickly. Here tariff's number four. Number five
GDP Gross domestic product. You hear this talked about all
the time, but basically, this is how you measure the
economy's health. This is like you're saying, what's the income
of your household? How much money do you make? That's GDP.
(33:31):
It's not profit, is not net worth, It's how much
did you produce? How much did you make? What's the
health of the country the GDP Number six stimulus and
relief packages. Where the COVID money went, and why that
matters now is what I explained a little while ago.
But that was all COVID. That was all stimulus and
(33:53):
relief packages. So when you hear these phrases, now you
know what this means. Number seven, the Federal Reserve. The FED.
The Federal Reserve has a very important and unique uh
position in the economy. The Federal Reserve is the central
bank of the United States. This is gangster, now, I
mean you think that you think the rap is gangster.
No banking is gangster. It's a it's a I did
(34:16):
a whole podcast last year breaking down how banks work.
Go back and listen to that podcast. Think of the
Federal Reserve is the bank for banks and the referee
on the US economy. The main responsibilities of the FED
controlling inflation, so price stability. The Fed's job is to
keep prices stable so your money doesn't lose value too quickly.
(34:39):
When inflation is too high, the FED raises interest rates
to slow spending and borrowing. It hurts you in the
short term, but your money still has has value. That's
why the US currency is a flight to quality of
All around the world, people in China talking mess about US,
and Russia talking mess about US, and Iran talking mess
about US, in North Korea talking mess about US. But
(34:59):
all these leaders when the cameras are off, want they're
and their money to come to the United States and
want to own our real estate. They want on our stock.
They want their families in the US. They when their
money in the US. They want the US currency, which
is is not even backed by the dock by gold anymore.
It's a free flowing currency backed by the full faith
and credit of the US government. This is gangster, right.
(35:20):
That is vibe, is a it's a feeling, it's sentiment.
The US currency is the most valuable currency. It is
a world currency. Still, I don't care what anybody's saying.
Ain't nobody and I say, ain't on purpose. Ain't nobody
trying to use no Chinese currency or Russian currency or
even the euro as a global currency. Uh it? You
know that nobody's trying to use the British pound is
(35:43):
you know, we don't mind it. But it's the US.
It's the US currency is like a globally valuable and
that's what everybody wants. Number two row maximizing employment. The
fair tries to help create. By the way, even in cryptocurrency,
what's the ultimate goal of cryptocurrency practitioners? They want to
(36:04):
they want to cash it out for what US currency? Right.
They're not trying to live with crypto forever. They trying
to make that money and cash it out and get
paid with Hello, US currency, even if it's digital US
currency they want so the FEDS. The next second row
of the FED is a maximize employment. The FED tries
to create and conditions for as many people as possible
to have jobs. When the economy slows down, the FED
(36:27):
might lower interest rates to encourage businesses to invest in
to hire. Number three regulate banks and to keep financial
systems safe. The FED one of the regulators. You have
the culture of the currency. You have the fdi C
Federal Deposit Insurant Corporation that you have state bank state
bank regulators as well, But the Federal Reserve is the
(36:48):
big baller because they have a multifunction role and they
the banks. The banks, the banks bank in the in
the nation's bank. The FED oversees major banks to ensure
that they are playing by the rules and not taking
excessive risk. This helps prevent another financial crisis like we
saw in two thousand and eight. Number four and the
(37:09):
FED was created in response to the Great Depression. Just
so you know, the number four as the FDIC was
as well. Number four maintains stability in the financial system
in times of panic like during COVID or a bank run.
The FED can step in as a backstop, as they
did during COVID, which I've explained during this podcast, providing
emergency loans are liquidity to keep the systems from classing
(37:30):
that as they did in two thousand and eight, the
recession that happened after the mortgage the mortgage meltdown Number five.
Then manage the nation's money supply and interest rates. The
FED sets a key interest rate called the Federal Funds Rate,
which influences borrowing, calls for credit cards, mortgages, student loans, etc.
It also controls a supply of money circulating in the economy.
(37:52):
You want to be you want to have a cool experience,
Take your kids, take your loved ones to your local
Federal Reserve Bank. The twelves there's twelve of them in
the fact, the Federals Bank here in Atlanta. As a
black president, I think it is the first time in
US history they's ever had a black president. Boston, Raphael Boston,
brilliant brother. Go take your loved ones and go take
a tour of the FED, and then get them to
(38:13):
cut some give you some of these recently cut currency
you may have to pay for it. They'll give you
some ShredIt currency for free, which is the old currency
they actually destroy. I know it seems sacrilegious, they actually
destroy old currency. Take it out of circulation. Go check
it out. It's really gangster what they do. I mean,
(38:34):
it's pretty fascinating. You won't be bored. Go get a
Federal Reserve tour and ask them about the Freedman's Bank
when you're at it, which is something that I helped to.
I'm proud to see I'm the only American citizen ever
to trigger the renaming of a building on the White
House campus. It was a Treasury annex building. Now it's
called the Freedman's Bank building, which was a bank chartered
by Abraham Lincoln after the Civil War to teach free
(38:54):
slaves about money. The Freedman's Bank another podcast for another day.
Why is this all? All? This matters? When the Fed
raises interest rates, your mortgage and credit card rates go up,
but inflation may cool down when it lowers rates. Borrowing
is cheaper, but prices can rise. The fans actions affect
your job security, your savings, your debt in your future.
(39:18):
In short, the Federal Reserve is as important as the
President of the United States of America. That's why the
FED chairman, Pow, the current FED chairman, is always cited
in the news. All right, so we're at number eight now. Ways,
growth versus cost of living? Why your paycheck doesn't go
as far as you'd love it, you'd like it to. Why.
It explained part of that in talking about the pandemic.
(39:41):
And I'm trying to get through this through this podcast,
and within forty five minutes i'll paper over that unless
you tell me in comments you want me to drill down.
I think you can figure out ways growth has cost
of living pretty easily. Supply chain. I've talked about this
when I explained the pandemic. It's the is supply of
the chain of supply of goods and services, and what
(40:03):
happens when the supply of that and the demand of
that are in balance, you get inflation. Unemployment rate all right, Well,
so again once again it's obvious, right, the rate of
those not working, even though it's fascinating that certain people
are actually not even counted in the unemployment rate. But
(40:25):
I'm going to get into that. But if you if
you just want to, if you just want to, if
you want to be a geek. Do some research on
who is actually counted and not counted in the unemployment rate.
All right, so we've covered a lot of ground here.
Here's some tips to survive and thrive in tough economic times.
(40:46):
Number one, know your numbers. Track your income, your expenses
and debt. Clarity brings control. Know your numbers. I like
math because it doesn't have an opinion. That's Melody hops
in quotes. I give her credit, but I use it
all the time because it really is illuminating, and I think, well,
I look, I love making smart and sexy. That is
(41:08):
making that is making smart and sexy sexy. I like math,
it just doesn't have an opinion. Know your numbers. Number two,
build a budget that that breeds. Build a budget that breeds.
Not about restrictions. It's about prioritizing what matters most. So
you want an expansive budget, a flexible budget, but you
want to prioritize your mortgage, your rent, your car notes,
(41:29):
your food, your shelter, you utilities. Uh, you know, and
but you need to have a budget. I mean, I
used to pooh pooh the I thought budgets were boring.
I think budgets are sexy now everybody needs a budget.
Wealthy people need a budget. Poor people need a budget.
Everybody needs a budget. Number three, cut hidden costs. So
(41:50):
this is a real big one. Subscriptions, fees, auto renewals.
Clean them all up. Going to your phone, going in
subscriptions in the settings, and you will be stuck most
of you, And how many things you're paying for every
month every year that you forgot about you You may
pick up thousands of dollars a year simply by going
and canceling useless not These companies rely on you forgetting.
(42:14):
They rely on you having add like short attention span.
Moving on to the next. You subscribe to something and
you don't even think about it anymore, and they're charging
you a buck ninety nine a month or a buck
ninety nine a year, Well buck ninety ninety year times
millions of people or even one hundreds of thousand of
people is a grab load of money for them. So
they're counting on you not missing a dollar or five bucks.
(42:36):
And once they once you get intothing, it allo renew
so you got to opt out of it, right, You
got to ask them to take you out of that.
So that's probably the big drop the mic of the
whole podcast. I've just saved you some money. Go cut
your subscriptions from your phone. Subscription from your phone in
the settings, at least in an iPhone is under settings
and Android. You let me know whether it's different A
(42:56):
number four Build or rebuild an emergency fund. About forty
percent of Americans don't have four hundred dollars for the
unplanned event. At Delta Airlines, we did a whole program
with combining financial coaching with an emergency savior's account, funded
by my friend Ed Bash and CEO of Delta were
funded by Delta with his leadership, and it's a hit.
I mean, it's really been an extraordinary success at Delta,
(43:19):
and it's helping them become a healthier company. The employees
are happier. But this is not about poor people. Most
Americans don't have four hundred dollars from unplanned dinner. Not
talking about your credit card money, even though that forty
percent number includes people who access to a credit card.
Most the credit cards not cash, that's borrowing. I'm talking
about forty dollars for your own money. So just start small.
(43:41):
Start with a small fund, a few hundred bucks, try
to get to the five hundred to one thousand dollars.
You have a thousand dollars for the emergency oh crap fund,
than that, you're a winner. I don't want you to
do it going to a payday loan lender when Johnny
gets sick and you have to pay. You got to
pay for Johnny's medical bills, and you miss rent. Right.
Number five, don't chase lifestyle, chase legacy. Invest in your future,
(44:06):
not your appearances. Your assets cannot be on your ass
Number six. Watch your credit. Good credit equals access opportunity,
lower costs, aim for a seven of the credit score.
You've heard me talk about this a million times, so
I will not belabor this right now, but I'll just
say this. If you go to the club tonight and
(44:29):
you see somebody you like and she's beautiful, she's fine,
he's handsome, said, oh damn, what's your name? Oh yeah,
that's cool and nice to meet you. What's your credit score?
If you get serious about somebody, don't just be fascinated
with their looks. It looks will go away in time.
That's your business partner for life. This is the only
where the mass should be multiplication, not addition. Two plus
(44:50):
two should equals equal more than four. If it doesn't,
what are you doing? If you're not better together, If
it doesn't equal six to eight or ten, what are
you doing? You can do bad all by yourself. That
Quincy Jones once told me God rest is soul. John.
He said, the only worse than being alone is wishing
that you were. Can I get an amen? Number seven
(45:11):
Side hustle smart beside hustle smart turn your skills or
passions into a second income stream. The easy ones are
uber lyft. You can rent out of room through Airbnb.
You can rent out that that RV is sitting in
your in your driveway. You rent out a spare car.
There's a lot of ways to be to You become
(45:33):
a notary, a notary public and do that as a
side hustle. There's a whole bunch of side hustles that
you can get into quickly to earn you some additional income.
Number eight by smart not big. Think value over luxury,
especially with cars and big ticket items. You don't want
to know one thousand, two thousand and three thousand dollars car. Note.
I mean that is crazy and people do this on
(45:55):
the regular. I just don't understand it. But I mean
in a car is also a diminishing value asset. It is.
It's bad debt because it decreases in value. You want
to have debt tied to things that increase in value,
which I call good debt. Mortgage, car, a car note,
a mortgage on the home, so on and so forth.
(46:16):
Even student loan I consider good debt because that's making
you smarter, which will allow you to produce more income
for yourself, earn better income. Number nine, Uh, learn before
you leave. Financial literacy is power. It is a Financial
literacy is a civil rights issue this generation. You know better,
you do better. So read, listen, and grow. Read my
book Financial Literacy for All, which is a national bestseller
(46:39):
in business finance, number one in the country since last April,
so coming up on a year of it being number one.
Buy it at Amazon, buy it at Walmart, buy it
at a black or minority owned bookstore. But get that
book and sign up to a financial coach. You get
(47:00):
operation to hope, tell him I sent you. They'll give
you one thousand dollars emergency savings account, sorry, one thousand
dollars scholarship to do for coaching and counseling. It is
an emergency savings account, by the way, because it's going
to save you money. Two ways of making money may
more spend less. This will help you spend less, thus
make more. If you're spaking making thirty six thousand dollars
(47:22):
a year and you and you're smoking three six packs
of cigarettes a week, two or three packs cigarettes, reason
going to Starbucks for coffee, you're you know, that's six
thousand dollars a year. That's ten percent of your income.
So go get a cured machine and stop smoking. You'll
live longer, be happier, and you can repurpose that that
(47:43):
six grand, twenty percent year income to do something meaningful
in your life. And tell your friends that follow this
podcast Number ten invest in yourself, mentorship, training, health. It
all pays dividends. So the economy feel like a foreign language,
but doesn't have to. When we understand the rules of
the game, we can win. Encourage all of your friends
(48:07):
to share this episode. Listen to this episode, Subscribe to
Money and Wealth, go to Operation Hope, get my book
Financial Ligency for All, become a civil rights leader. And
I want you to understand that there's a difference between
being broken being poor. Being broke as economic being. Being
poor as a disabling frame of mind, a depressed condition
(48:28):
of your spirit, and you must vow never ever ever
to be poor again. I also want you to know
that there is a business plan for Black America coming
on April fourth. We will be meeting in Memphis, Tennessee,
fifty seventh anniversary of the assassination of doctor Martin LA
King Junior. I am co chairing. I was asked the
CoA chair with the Memphis Mayor Paul Young, doctor Bernice King,
(48:51):
the daughter of doctor King, and the CEO of the
King Center, Ambassador Andrew J. Young, who built modern Atlanta
to the tenth lars economy in the country and the
biggest on me for black brown folks in the world.
That's a city that's successful at this scale. Five hundred
and eighty billion dollars I believe is the last number
for GDP for the city of Atlanta. He was on
that balcony with doctor King was assassinated. All of them
(49:13):
will be co hosting with me. The Undefinished Dream event
in Memphis, Tennessee is going to be online and I
will encourage you to to Dream Forward, which is the
official name for the event. Go to operational dot org
or just search dream Forward, Operation Hope and register for
(49:34):
this global town hall is virtual April fourth, one to
three pm Easter Standard Time, twelve to noon Central Time.
A lot of ballers, heroes, heroes that you love and
respect will be speaking that day. Killer Mike sam Audman,
Bernice King, just the I mean, Nicole Pullin, Ross, Ray McGuire,
(49:58):
Stride Massieu with a six richest man in Africa's Van Jones,
Bishop TD Jakes, the CEO of Walmart W. Millan, the
sound of Brown Ducket I was running a two tree
dollar company as a black woman, Charlemagne, that God, the
CEO of the President of Shopifi, Harley Finkelstein. Uh just,
I mean, just an unbelievable group of leaders. And it'll
(50:21):
be Republicans and Democrats, blacks and whites, rich and poor.
Billionaire next to millionaire. Next somebody's trying to buy some
there right with a business plan for America, the business
plan for Black America, which is a signal for the
other business plans we're going to create for Latino Americans,
for Native American Indians, for rural America. Uh to so
(50:43):
that we all can come up from nothing. Uh So
make sure you register for that. It's free. It is
our service for you. This is a silver rights blueprint
for all of us. It is a business plan built
on hope and it includes you. And we're going to
tell you how to come up. I'm telling you how
to come up into individually, We're going to tell you
(51:05):
how we're gonna come up as a group. And yeah,
I'm very excited. So see you there, John O'Brien, this
is Money and Wealth. Let's go change the world as
be this change we want to see in the world.
(51:32):
Money and Wealth with John O'Brien is a production of
the Black Effect Podcast Network. For more podcasts from the
Black Effect Podcast Network, visit the iHeartRadio app, Apple Podcasts,
or wherever you listen to your favorite shows of
Speaks to the Plannet.
Speaker 2 (00:01):
I go by the name of Charlamagne the God, and
guess what, I can't wait to see y'all at the
third annual Black Effect Podcast Festival. That's right, We're coming
back to Atlanta, Georgia, Saturday, April twenty six at Poeman
Yards and it's hosted by none other than Decisions, Decisions Man,
D B and Wheezy. Okay, we got the R and
B Money podcast were taking Jay Valentine. We got the
Woman of All Podcasts with Saray Jake Roberts, we got
(00:22):
Good Mom, Bad Choices. Carrie Champion will be there with
her next sports podcast and the Trap Nerds podcast with
more to be announced. And of course it's bigger than podcasts.
We're bringing the Black Effect Marketplace with black owned businesses
plus the food truck court to keep you fed while
you visit us. All right, listen, you don't want to
miss this. Tap in and grab your tickets now at
Black Effect dot Com Flash Podcast Festival.
Speaker 1 (00:45):
Welcome the Money in Wealth with John O'Bryant, a production
of the Black Effect Podcast Network and iHeartRadio. Hey, Hey
is John Hobryant And this is Money and Wealth on
the Black Effect Network. iHeartRadio and I want to thank
(01:09):
everybody for continuing to support. The podcast is growing very rapidly.
It just shows that you want to understand how this
stuff works. We want to go from civil rights marching
in the streets to cutting business deals in the suites
the ownership class. Can I get an amen? This is
my pulpit of finance. So this week I'm going to
(01:31):
break down how the modern economy works. This is what
they never taught you in school. Like you're not dumb
and you're not stupid. Is what you don't know that
you don't know is killing you. But you think you
know and you're too ashamed, too embarrassed to ask questions.
Are you're just too busy. You're just moving and grooving
(01:53):
and trying to make a living and a life. You
got too much month at the end of your money.
You know, you're trying to live this life holding complete
and you're doing the very best you can, and I
commend you for that. You're trying to raise your family,
trying to build a family, trying to build a life. Meanwhile,
no one's ever taught you how this system works, and
people expect you to figure it out. For yourself, and
(02:14):
they throw all these terms at you and expect you
to understand what the heck it is. And I don't
know why, because literally no one's taught you. So I'm
gonna break it down for you in this episode. I'm
going to unpack the basic stuff that you need to
know to navigate in this world and to understand the
(02:36):
terms right now in early twenty twenty five that are
being thrown at you with some presumption. So let's get
at it, and then I'm gonna leave you with some
helpful tips of what you do to maneuver to manage
yourself successfully in this environment. All right, So again, there's
(02:57):
nothing wrong with you in not knowing right out of failure.
You may have had a feled experiment, but that's just
the result of you trying. I rather you try and
slip and fall and never try at all. So it's
what you don't know that you don't know this killing you.
But you think you know and others presume you know,
and I'd rather you master the class. So this is
(03:21):
a master class. Here we go terms to break down inflation, recession,
interest rates, tariffs, GDP, stimulus and relief packages. The federal
(03:50):
reserve system. They call it the FED wage growth versus
cost of living, supply chain, unemployment rate. There are some
items I'm gonna spend more time on than others. I'm
gonna cover some of these, just gloss over them. But
(04:10):
I'm gonna spend a little bit of time on a
couple of these items in particular because they relate to
the current situation. All right, Inflation, what is it? In general?
Inflation is where everything just costs more and you can't
(04:35):
quite figure out why it costs more. The background of
inflation in the modern description we're gonna talk about here
is tied to COVID. So let's first start with what
is inflation. Inflation is when prices go up across the board.
(04:56):
I mean groceries and as we now know, eggs, gas, rent,
everything just seems to be going up, certainly at a
higher rate than your income, and is dang on frustrating.
Folks got too much month at the end of their money.
Seventy percent of this country, seventy percent of the economy,
and the biggest economy in the world, the United States
(05:17):
of America, is consumer spending seventy percent, right, and seventy
percent of Americans So seventy percent of the economy, biggest
economy in the world's consumer spending, and seventy percent of
Americans are living from paycheck to paycheck. Not black people,
not brown people, everybody. And whether you're white, black, red, brown, yellow,
(05:38):
you want to see some more green, can I get
me amen? So, if inflation is when prices go up
across the board, it means your dollar doesn't go as
far as it used to. Now, why does this happen?
At its core, it's basically too much money racing too
(06:00):
few goods. We call it supply and demand. When demand
is high, supplies low, prices rise. Why is COVID important
in this conversation? And why do I say it's all connected?
I mean, people want to blame this stuff on US
presidents and all this kind of stuff, And really that's
(06:24):
a false flag because of a virus probably created in
China unleashed. And I think I shouldn't say this, but
I wouldn't be surprised if someone, some elements unleash this
intentionally in order to trip up the biggest economy in
(06:45):
the world, to try to take an advantage, to get
an advantage on the US, to leap fraud over US
to slow us down, use our freedoms against us. That
didn't work, but I wouldn't be surprised if it was
not intentional. China's at war with the United States. I'm
going to do a whole piece on Africa and China
(07:05):
as a separate podcast, but I'm trying to give you
some practical stuff that you need right now before I
start giving sort of macroeconomics and global economy stuff. So
just staying very focused. COVID was a reaction to something
not created here. It was created. It was a virus
that that literally stopped the US economy, stopped it and tracks.
I've already told you the biggest economy in the world
(07:28):
is driven by consumer spending. And then consumers were not moving, grooving, rolling, operating.
I mean we were all locked literally for a while,
locked into our homes, lockdown. The whole economy just basically
grind ground to a halt. So the US economy nearly
shut down to avoid a depression. I'm going to define
(07:48):
a depression in a moment, the government and the Federal
Reserve pumped over eight trillion dollars into the economy. Okay,
just to put this into context. Ever, in the history
of the modern world, has a government ever put a
trillion dollars into a stimulus I'm explained that at the
(08:11):
moment into the U into any economy, not just the
US economy, any economy in the world. There's never been
a trillion dollars of real money, I mean like fun
money or funding money, or some third world countries, real
money of a major currency invested in its economy. That's
how bad this was. And it wasn't one trillion or
(08:31):
two trillion, or three or four or five trillion or
six trillion. It was over eight trillion dollars. You can
bind what the Federal Reserve did and what the Congress,
bipartisan Republicans and Democrats, okay, and a Republican president Trump
and a Democratic President Biden did right to keep the
(08:57):
US economy from absolutely stalling, so to avoid a depression,
which is different than a recession, it's worse. Again explaining
that in a moment, to avoid a depression, the government
in the Federal Reserve pumped over eight trillion dollars in
the economy. That money came from one government stimulus spending.
(09:17):
That's Congress, okay, bipartisan meaning both parties. So anybody explained
wants to blame this on Democrats or blame this on
the Republicans alone, It's just dead wrong. It was by partisan.
Both parties realize how bad this was, and Republican and
Democratic presidents both did their own versions of what I'm
(09:38):
about to tell you. Direct checks to individuals three rounds,
twelve hundred dollars, six hundred dollars, and fourteen hundred dollars.
You probably know these numbers because you probably received a check. Okay.
There was some misinformation that this money was directly a
result of one of our former presidents because he had
(09:59):
his name on him. No, he just directed I think
the US Treasury Department, but I'm correct to put his
name on the checks. But the money came from Congress. Okay.
Expanded Unemployment Benefits was the second version of what is
included in the stimulus. The third perst portion you would
recognize PPP loans. There's a lot of fraud tied a
(10:21):
PPP loans that people are going to jail right now.
And small business Assistance, rent and mortgage relief was the
fourth element, and child Tax Credit was the fifth element. Okay,
So this is the government stimulus spending through Congress first
(10:42):
part of the stimulus. Now, the purpose of this was
to keep Americans and businesses afloat while the economy was frozen,
so we didn't go into a depression. Number two Federal
Reserve actions. This is now two thousand year two thousand
years two. I don't if anybody's ever explained this to you.
I'm explaining, I'm explaining it. I'm unpacking it, hopefully in
(11:07):
ways that everybody can understand. Spread this to your friends,
tell everybody to go back and listen to this. I
am explaining to you where inflation came from, what happened
during COVID, how transformation really if now I'm going to
be I guess political, if you want to are I'm
going to be deeply opinionated here for a moment. If
President Biden's advisors were really, really on top of it,
(11:30):
they would have told him to run for one term only.
You're going to fix the economy, You're going to get
America back on track, you're going to check all the boxes.
You're going to drop the mic, bounce and leave. That
would have been I think a brilliant piece and a
great legacy for him. I think he just stayed too long.
Power is very intoxicating. I understand it, and he wanted
a second term and all that kind of stuff, but
(11:53):
he did the Biden This is not a partisan comment.
I've advised three presidents from both parties. Biden Harris administration
did stabilize the biggest economy on the planet and kept
it from going over the cliff. That plus a Republican
(12:14):
and Democratic Congress working together, That's just a fact. Got
no credit for it because I think they're horrible marketers
and horrible communicators of their successes. And then some people
even talked about how this are socialists. We're not a
socialist country, We're a capitalist country. Right. I'll do a
(12:35):
separate podcast explaining what socialism, communism, capitalism, all these things are.
Most people just I'm convinced and financially illiterate. But even
if you want to destrud money like a socialist, you
have to first collect it like a capitalist. Can I
get an a man? And as I keep saying, people
say they hate rich people, Oh you don't you hate
(12:56):
rich people until you become rich. What you hate is
a game system. Right, I'm trying to ungame the system
for you by explaining it to you and giving you
the rules of the game. Financial literacy, which I believe
is the civil rights issue of this generation. So you
know better, so you can do better. The second part
of the stimulus package was the Federal reserve actions. Number one,
(13:18):
they dropped interest rates to nearly zero to encourage borrowing
and spending to keep the party going. Two, they bought
trillions of dollars in bonds to inject cash into the system. Ok.
Number three, they supported financial markets to prevent collapse. This
put an artificial floor on the value of Wall Street stocks,
(13:44):
which meant that the value of stocks had no choice
really than to go up. So now this is contributing
to inflation because now you're inflating the value of cars,
inflating the value of art, inflating the value of real estate,
inflating you know, you name it, right, stuff, you're trying
(14:05):
to go buy stuff, there's not enough of it, and
the federal reserves keeping the markets from collapsing, so you
think you're getting richer because the government is subsidizing really
the whole situation. So in the short term effects it worked, right,
There was massive economic collapse that was avoided. People had
(14:28):
money to spend, businesses stayed open, jobs came back, the
stock market and the housing market boomed for the reasons
I just mentioned. You may have to go back and
replay some of what I'm saying, so it all sort
of locks in. But your heads should be nodding now,
going yeah, okay, okay, I get it, I get it.
(14:48):
Long term effects of these two actions inflation. All that
money flooded the economy. At the same time, supply chains
were broken, which means factory shut down, ships shipping, backed up,
(15:14):
labor shortages. The shipping companies were gouging companies for shipping bins.
I mean, it was just everybody sort of pump pimping
the system back. Then supply and demand not enough supply,
too much demand, prices go up. Combine that with all
(15:34):
this money flooding from the federal government, there's just too
much grease on the gears of the economy. It flooded
the engine. The result was more money in people's hands
plus fewer goods on shelves equals prices spiked. Did you
get that. I know you're smart. You made to repay this,
replay this and play it back again. Inflation hit forty
(15:56):
year highs between twenty twenty two and twenty twenty. That
was nobody's fault. It was either that or the economy
was going to implode. Now, was there too much stimulus? Probably?
In fact not probably. There's probably a tree and a
half dollars at least of too much stimulus. But let
me ask you this question, where's a stimulus where's the
pandemic manual? You pull off the shelf. If you're the
(16:20):
Federal Reserve chairman, or the President the United States where
or or Congress or whoever you're some you're some economists,
where's the man You pull off the shelves and go, yep,
this is exactly the amount of stimulus you need in
order to keep the biggest economy in the world from imploding.
There's not been a pandemic of this size since the
Spanish flew one hundred and twenty five plus years ago,
(16:41):
so there was no manual, and that was before the
Federal Reserve was creed and created. All right, So this
was just winging it. And it's better to put too
much oil on the gears than to starve the engine
from oil, and the engine seizes up. So you don't
want to be the guy sitting at the control booth
in the economy for the biggest economy in the world,
and the democracy collapses because you you didn't put enough
(17:04):
energy into it. So they put too much energy into it.
They overdid it probably by twenty percent, maybe twenty five percent, right,
and that has created sustained inflation that's not been seen
since in forty years. The Fed then had to slam
the brakes on raising interest rates by raising interest rates
(17:24):
aggressively to cool things off, so they hit interest rates
down to zero right to flood to create more activity,
and then to slam the brakes on that activity, they
raised interest rates, and people thought interest rates were just
way too high, But in reality, the interest rates of
five to six percent are pretty dang on good. It's
(17:45):
just we were used to for the longest time we're
listed form like a decade, used to interest rates one, two,
three percent, and then for a minute it was zero.
So we got spoiled. This generation got spoiled. But that's
not the reality. The real time impact today, higher prices
at the grocery store, the gas pump, rent, credit card
(18:06):
interest rates at historic highs, harder for people to buy homes, cars,
or borrow money. Okay, because the debt. The income ratios
are higher because interest rates are higher. I had one
line of credit that had a balance of It was
a million and a half dollars or something, and it
(18:28):
was a floating interest rate. And when interuest rates were
very low, I was paying like twenty five hundred dollars
a month in interest payments. I was like, oh, I
love this. But when interest rates went up, the monthly
payment was ten thousand dollars a month. Now, luckily I
can afford that. But that's a four x increase an
interest expense, and that happened to everybody, right, whether you're
(18:51):
wealthy or not. That hurts. The aftershocks of trillions of
dollars in emergency spending is still being felt today. Here's
the bottom line. The eight trillion dollars saved us from disaster,
but now we're paying the price in the form of
inflation and higher interest rates. Understanding the trade offs that
(19:13):
trade off of these things help people navigate, well, help
you navigate actually the economic realities of today with clear eyes.
Now let me back up and go back to breaking
(19:36):
down these different things. So now I've in the first
twenty minutes of this podcast, I've solved the biggest problem
for you. Now you can go talk to your friends
and be like I think, I keep saying, we need
to make smart sexy. We've been making dumb sexy for
way too long. We've dombe down and celebrated it. It's
time to make smart sexy again. Now you're going to
(19:57):
be the sexiest person at the cocktail party. Here are
hanging out with your friends because now you can explain
something that nobody understands. You can explain it. You can
explain inflation, Where did it come from, who's responsible all
of us? And and how long is it going to last?
A while? Right, But it's not a boogeyman anymore. It's
it's just the facts jet recession, what it actually means,
(20:23):
and why it sparks fear. Well, why what it means
and what it doesn't mean? Why does it spark fear?
Let me explain now, recession versus a depression. A recession
is a temporary economic decline where the economy shrinks negative
GDP growth for at least two consecutive quarters six months.
The key signs of recession slower economic activity. We're seeing
(20:46):
that right now in the economy, rising unemployment. You've seen
right now in that right now in the economy, decline
in consumer spending and business investment. You're seeing that right
now in the economy. Lower company profits. You're about to
see that in the economy. Sometimes triggered by inflation or
high interest rates. We're seeing both of those in the economy.
(21:08):
So thinking of it like this or the economy is
catching a code, it's serious, but it's usually short term.
If we experience a recession in twenty twenty five, and
I think there's a twenty five percent chance of it
and increasing, it's man made. It's it's intentional. It's well
not intentional. It's there is a bet being made in Washington,
(21:29):
d c. On economic policy that if I guess they
believe it's right, then I mean, I don't. I'm not
get in their heads. But if they're wrong, I can't
tell you about whether they're right. If they're wrong, it
could trigger a recession. Now, I think the economy is
basically strong, which is the bones' economy is basically strong.
(21:50):
It's not. This is not like two thousand and eight,
So we can recover quicker than we otherwise would, but
we are this is a if we have recession, it
is a man made recession. Here's what it's not. Is
not a depression. Here's a depression. Okay, not, you're depressed.
(22:11):
I'm talking about an economic depression. A depression is a
prolonged and severe recession that lasts years instead of six
months or less, with massive unemployment, deep declines in economic output,
and often a breakdown in financial systems. That's what have happened.
There wasn't the stimulus of two thousand to twenty twenty two.
(22:32):
The key signs of a depression GDP plunges dramatic, drastically,
unemployment hits double digits and stays high, wide spad poverty,
and bank failures, long periods of recovery, often a decade
or more. Now, what's an example of a depression? The
Great Depression nineteen twenty nine into the late nineteen thirties.
(22:54):
In fact, it took World War two and the spinning
tide to that of the government into the private sector.
That that was what actually shook us out of the
Great Depression. That wasn't this nineteen thirty nine nineteen forty
unemployment hit twenty five percent back then, the stock market
and lost nearly ninety percent of its value. Think about
(23:14):
that that was the Great Depression. Think of it like this,
the economy on life support, deep, painful and long lasting.
That's not what we're dealing with, right, So you can
check that box and remove that from your thought process.
Now let's deal with interest rates. I think I've covered
(23:35):
this to your satisfaction, but if you if you don't
know why interest rates are important and how why I'm
upsessing about credit scores. The higher your credit score, the
lower your interest rate. Right, The lower your credit score,
the higher your interest rate. It's almost in direct proportion
if you don't pay your bills, if you know you're
(23:55):
going to have if you're not responsible about your fiscal situation,
you have really crappy credit score. I've been there, and
you're going to pay a very high interest rate. Those
who those who make the least pay the most, certainly
if you don't manage your financial but frankly, it's not
just the poor. The poor pay the most, but generally speaking,
(24:16):
but if you're wealthy and don't pay your bills, same
it is also true. If you're wealthy, don't pay your bills,
you will have a crappy credit score. Anyway, that's what
interest rates are, and again, I covered that a minute ago,
so you know, back and listen to that. I'm trying
to get through a lot of ground in one podcast tariffs.
I love this conversation. Okay, so what the heck is
(24:37):
going on with tariffs? A tariff is a tax, Okay,
not an attack. It's a tax. Well maybe an attack too,
and it is a tax on the recipient, the buyer
of goods is not. So if we have a tariff
(25:00):
on China, or a tariff on Canada, or a teriff
on Mexico, this is not saying, oh, Mexico, we're gonna
make you paid, Canada will make you pay, Texas, Texas, China,
we're gonna make you pay. No, if you're the CEO
of a major retailer in America and you're buying products
from let's say China as an example, you're paying. The
retailer's paying, so they're paying the tax. The tax goes
(25:25):
to the federal government. So the federal government is theoretically
making some money, but it is not. This is I
don't think this is money that's worth it, because the
trade off on that is could be catastrophic if you
don't play it properly. What did I say seventy percent
of the US economy is consumer spending, right, And we've
already seen what happened when you when you stressed out
(25:45):
the consumer economy in COVID. So, a tariff is a
tax that is paid for by the buyer of the goods,
whoever that buyer is. Follow me here, now, what is
that buyer going to do in the natural scheme of things,
(26:06):
unless they just are making a crap load of profit
or somehow being offset by a credit by the federal government,
which that's not going to happen. The federal government is
actually trying to take the tax as revenue for the
federal government in this example. But that manufacturer, sorry, that
that manage, that importer is going to in all likelihood
(26:28):
pass on that cost to you, the consumer. What is
that going to do with your cost of goods? Raise them,
raise them? Sorry? In most situations that that the retailer.
I won't pick an I'm not gonna pick on the retailer.
It doesn't matter which one it is. If there is
a if there's a tariff on what they're buying from
(26:51):
China in this example, it will raise the cost of
that thing because they got to pay a tax on
it to the government. That means they got to pass
that in order to be profitable. They got to pass
that raise the costs from a buck to a buck
twenty five in this example, and pass that cost on
to you the consumer, and if the consumer has too
much month at the end of their money. Hello, okay,
(27:13):
So why does somebody why does a politician use a terraff?
They're trying to, in all likelihood to negotiate with the
company because there's trade and balances company the country that
they're putting the tariff on, because that means there's less
demand for that country's goods because the buyer is less
incentivized to buy the product from that country. So they're
(27:34):
trying to negotiate with that country by penalizing that country
with less demand of their goods. I hope this is
making you some sense. You can replay this if you
need me to slow this down for you, and I'm
explaining to you why I don't think it's going to
work in this example. So in the short term, you
can use this as a negotiating tool to extract what
you want politically from your adversary who you're trying to
(27:58):
hit over the head with this paroff to get them
to do what you want them to do. The secondary
reason you might want to do this is to make
goods that are foreign less cheap, less attractive than homemade goods,
(28:19):
and so that you're quote being bringing manufacturing back home.
Please in the comments, tell me whether when you see
this on social media, on YouTube, whatever, as a podcast
gets shared, let me know whether this is where I'm
doing a good job of translating this. It's really important
you get this. So I've just told you there's a
political reason to do tariffs, and then there is a
(28:42):
a bring back home manufacturing so that the homemade goods
are cheaper than the foreign goods rationale for doing this. Okay,
can tariffs work? Yes, if you extract, if you set
a tariffs and you make it short term, and you
(29:04):
make it definitive, then it can work. But you've got
to make sure you've got a strong economy. You got
to make sure you have all sets so that the
average every day American doesn't get whacked over the head
when this is going on, which means you need to
be very thoughtful about it. It needs to be really thought out.
So hold on to that for a minute. What's happening
(29:25):
now is it's the tariff today, tariff's off tomorrow, the
tariffs ten percent, tariffs twenty five percent. It's up is down,
as left is right, it's it's how do I feel today? Well,
that I don't think is as elegant a strategy and
may not be sustainable. And it's combined with the second
problem of here here. And I'm not being critical. I'm
(29:46):
just I mean, we need the we need our com
froment to be successful, so I'm rooting for them. I
just don't understand this particular strategy, and I don't think
it's well advised. Let me just say that for the record,
let me give you the big drop the mic. In
order for teriffs to work, where you're bringing manufacturing back home,
which is one of the talking points you would have
(30:10):
had a year before you became president, met with all
of the major banks and all the major capital providers, financiers,
all the major fortune five hundred company CEOs and said, look,
if I win, when I win, I'm going to be
bringing manufacturing back home. I'm going to be putting tariffs
in the following areas, and I need for you to
plan for that. I need for you to go to
(30:31):
your Board of directors, go to your governance committees, governance
committees of your board. I need you to go to
your shareholders, your investors, and tell them that we want
to allocate We want you to allocate capital in your
industries to build factories, you know, to create jobs in
all these different places. And by the way, this could
have worked and combine that with the Biden infrastr seventy
(30:53):
thousand Biden infrastructure projects, roads, bridges, etc. That are and
that all together create a bunch of jobs, and then
we're going to bring manufacturing back home. Theoretically that could
have worked. Two problems with that one. That didn't happen. Right,
nobody mad with anybody it made any long term plans.
(31:14):
I know because I'm talking to these CEOs. No one
this is all new news to them. They're finding out
on Twitter or ex or whatever. It is, just like
everybody else. So what the policy is, and you cannot
No one's going to allocate millions, tens of millions in
some case billions of dollars and bit tens of billions
of dollars in some cases for automobile manufacturers or steel
plants whatever. Just because somebody sends out a tweet today
(31:36):
and says that they're they're changing policy overnight. They just
can't pivot on a dime like that. Doesn't matter whether
they like it, don't like agree, or do disagree. You
just can't move that fast, particularly when you wake up
the next day and the policy is changed again. Uh So,
(32:00):
one they didn't have the chance the time to allocate
the capital. And two we're not a manufacturing country anymore,
not for heavy you know, traditional goods. We're too expensive.
The country took expensive of that that that party left
us that you know in the late seventies and eighties.
That does a game for developing nations where it's cheaper
(32:21):
to do it. Here's the other problem. Even if you're
manufacturing something at home that's not technology based or there
are some things we do do well knowledge based stuff.
But if you're manufacturing traditional stuff here, the parts of
that thing. Let's take an automobile as an example, are
often imported. Even if you manufacture the thing here, you
still need parts from other parts of the world, which
means we're still interdependent. Okay, so this is not this
(32:46):
is this is not designed well, in my opinion, to
work and that is why I think you're going to
see tariffs create an increase in prices for you and
short term until you know, they run the course of
this experiment, and hopefully this will stop sometime soon because
(33:08):
I think it's going to slow down the economy and
cause more pain to the average consumer. Let me know
if I explained that well, number five, so I've got
done tariffs number four. I'm gonna run through the rest
of them pretty quickly. Here tariff's number four. Number five
GDP Gross domestic product. You hear this talked about all
the time, but basically, this is how you measure the
economy's health. This is like you're saying, what's the income
of your household? How much money do you make? That's GDP.
(33:31):
It's not profit, is not net worth, It's how much
did you produce? How much did you make? What's the
health of the country the GDP Number six stimulus and
relief packages. Where the COVID money went, and why that
matters now is what I explained a little while ago.
But that was all COVID. That was all stimulus and
(33:53):
relief packages. So when you hear these phrases, now you
know what this means. Number seven, the Federal Reserve. The FED.
The Federal Reserve has a very important and unique uh
position in the economy. The Federal Reserve is the central
bank of the United States. This is gangster, now, I
mean you think that you think the rap is gangster.
No banking is gangster. It's a it's a I did
(34:16):
a whole podcast last year breaking down how banks work.
Go back and listen to that podcast. Think of the
Federal Reserve is the bank for banks and the referee
on the US economy. The main responsibilities of the FED
controlling inflation, so price stability. The Fed's job is to
keep prices stable so your money doesn't lose value too quickly.
(34:39):
When inflation is too high, the FED raises interest rates
to slow spending and borrowing. It hurts you in the
short term, but your money still has has value. That's
why the US currency is a flight to quality of
All around the world, people in China talking mess about US,
and Russia talking mess about US, and Iran talking mess
about US, in North Korea talking mess about US. But
(34:59):
all these leaders when the cameras are off, want they're
and their money to come to the United States and
want to own our real estate. They want on our stock.
They want their families in the US. They when their
money in the US. They want the US currency, which
is is not even backed by the dock by gold anymore.
It's a free flowing currency backed by the full faith
and credit of the US government. This is gangster, right.
(35:20):
That is vibe, is a it's a feeling, it's sentiment.
The US currency is the most valuable currency. It is
a world currency. Still, I don't care what anybody's saying.
Ain't nobody and I say, ain't on purpose. Ain't nobody
trying to use no Chinese currency or Russian currency or
even the euro as a global currency. Uh it? You
know that nobody's trying to use the British pound is
(35:43):
you know, we don't mind it. But it's the US.
It's the US currency is like a globally valuable and
that's what everybody wants. Number two row maximizing employment. The
fair tries to help create. By the way, even in cryptocurrency,
what's the ultimate goal of cryptocurrency practitioners? They want to
(36:04):
they want to cash it out for what US currency? Right.
They're not trying to live with crypto forever. They trying
to make that money and cash it out and get
paid with Hello, US currency, even if it's digital US
currency they want so the FEDS. The next second row
of the FED is a maximize employment. The FED tries
to create and conditions for as many people as possible
to have jobs. When the economy slows down, the FED
(36:27):
might lower interest rates to encourage businesses to invest in
to hire. Number three regulate banks and to keep financial
systems safe. The FED one of the regulators. You have
the culture of the currency. You have the fdi C
Federal Deposit Insurant Corporation that you have state bank state
bank regulators as well, But the Federal Reserve is the
(36:48):
big baller because they have a multifunction role and they
the banks. The banks, the banks bank in the in
the nation's bank. The FED oversees major banks to ensure
that they are playing by the rules and not taking
excessive risk. This helps prevent another financial crisis like we
saw in two thousand and eight. Number four and the
(37:09):
FED was created in response to the Great Depression. Just
so you know, the number four as the FDIC was
as well. Number four maintains stability in the financial system
in times of panic like during COVID or a bank run.
The FED can step in as a backstop, as they
did during COVID, which I've explained during this podcast, providing
emergency loans are liquidity to keep the systems from classing
(37:30):
that as they did in two thousand and eight, the
recession that happened after the mortgage the mortgage meltdown Number five.
Then manage the nation's money supply and interest rates. The
FED sets a key interest rate called the Federal Funds Rate,
which influences borrowing, calls for credit cards, mortgages, student loans, etc.
It also controls a supply of money circulating in the economy.
(37:52):
You want to be you want to have a cool experience,
Take your kids, take your loved ones to your local
Federal Reserve Bank. The twelves there's twelve of them in
the fact, the Federals Bank here in Atlanta. As a
black president, I think it is the first time in
US history they's ever had a black president. Boston, Raphael Boston,
brilliant brother. Go take your loved ones and go take
a tour of the FED, and then get them to
(38:13):
cut some give you some of these recently cut currency
you may have to pay for it. They'll give you
some ShredIt currency for free, which is the old currency
they actually destroy. I know it seems sacrilegious, they actually
destroy old currency. Take it out of circulation. Go check
it out. It's really gangster what they do. I mean,
(38:34):
it's pretty fascinating. You won't be bored. Go get a
Federal Reserve tour and ask them about the Freedman's Bank
when you're at it, which is something that I helped to.
I'm proud to see I'm the only American citizen ever
to trigger the renaming of a building on the White
House campus. It was a Treasury annex building. Now it's
called the Freedman's Bank building, which was a bank chartered
by Abraham Lincoln after the Civil War to teach free
(38:54):
slaves about money. The Freedman's Bank another podcast for another day.
Why is this all? All? This matters? When the Fed
raises interest rates, your mortgage and credit card rates go up,
but inflation may cool down when it lowers rates. Borrowing
is cheaper, but prices can rise. The fans actions affect
your job security, your savings, your debt in your future.
(39:18):
In short, the Federal Reserve is as important as the
President of the United States of America. That's why the
FED chairman, Pow, the current FED chairman, is always cited
in the news. All right, so we're at number eight now. Ways,
growth versus cost of living? Why your paycheck doesn't go
as far as you'd love it, you'd like it to. Why.
It explained part of that in talking about the pandemic.
(39:41):
And I'm trying to get through this through this podcast,
and within forty five minutes i'll paper over that unless
you tell me in comments you want me to drill down.
I think you can figure out ways growth has cost
of living pretty easily. Supply chain. I've talked about this
when I explained the pandemic. It's the is supply of
the chain of supply of goods and services, and what
(40:03):
happens when the supply of that and the demand of
that are in balance, you get inflation. Unemployment rate all right, Well,
so again once again it's obvious, right, the rate of
those not working, even though it's fascinating that certain people
are actually not even counted in the unemployment rate. But
(40:25):
I'm going to get into that. But if you if
you just want to, if you just want to, if
you want to be a geek. Do some research on
who is actually counted and not counted in the unemployment rate.
All right, so we've covered a lot of ground here.
Here's some tips to survive and thrive in tough economic times.
(40:46):
Number one, know your numbers. Track your income, your expenses
and debt. Clarity brings control. Know your numbers. I like
math because it doesn't have an opinion. That's Melody hops
in quotes. I give her credit, but I use it
all the time because it really is illuminating, and I think, well,
I look, I love making smart and sexy. That is
(41:08):
making that is making smart and sexy sexy. I like math,
it just doesn't have an opinion. Know your numbers. Number two,
build a budget that that breeds. Build a budget that breeds.
Not about restrictions. It's about prioritizing what matters most. So
you want an expansive budget, a flexible budget, but you
want to prioritize your mortgage, your rent, your car notes,
(41:29):
your food, your shelter, you utilities. Uh, you know, and
but you need to have a budget. I mean, I
used to pooh pooh the I thought budgets were boring.
I think budgets are sexy now everybody needs a budget.
Wealthy people need a budget. Poor people need a budget.
Everybody needs a budget. Number three, cut hidden costs. So
(41:50):
this is a real big one. Subscriptions, fees, auto renewals.
Clean them all up. Going to your phone, going in
subscriptions in the settings, and you will be stuck most
of you, And how many things you're paying for every
month every year that you forgot about you You may
pick up thousands of dollars a year simply by going
and canceling useless not These companies rely on you forgetting.
(42:14):
They rely on you having add like short attention span.
Moving on to the next. You subscribe to something and
you don't even think about it anymore, and they're charging
you a buck ninety nine a month or a buck
ninety nine a year, Well buck ninety ninety year times
millions of people or even one hundreds of thousand of
people is a grab load of money for them. So
they're counting on you not missing a dollar or five bucks.
(42:36):
And once they once you get intothing, it allo renew
so you got to opt out of it, right, You
got to ask them to take you out of that.
So that's probably the big drop the mic of the
whole podcast. I've just saved you some money. Go cut
your subscriptions from your phone. Subscription from your phone in
the settings, at least in an iPhone is under settings
and Android. You let me know whether it's different A
(42:56):
number four Build or rebuild an emergency fund. About forty
percent of Americans don't have four hundred dollars for the
unplanned event. At Delta Airlines, we did a whole program
with combining financial coaching with an emergency savior's account, funded
by my friend Ed Bash and CEO of Delta were
funded by Delta with his leadership, and it's a hit.
I mean, it's really been an extraordinary success at Delta,
(43:19):
and it's helping them become a healthier company. The employees
are happier. But this is not about poor people. Most
Americans don't have four hundred dollars from unplanned dinner. Not
talking about your credit card money, even though that forty
percent number includes people who access to a credit card.
Most the credit cards not cash, that's borrowing. I'm talking
about forty dollars for your own money. So just start small.
(43:41):
Start with a small fund, a few hundred bucks, try
to get to the five hundred to one thousand dollars.
You have a thousand dollars for the emergency oh crap fund,
than that, you're a winner. I don't want you to
do it going to a payday loan lender when Johnny
gets sick and you have to pay. You got to
pay for Johnny's medical bills, and you miss rent. Right.
Number five, don't chase lifestyle, chase legacy. Invest in your future,
(44:06):
not your appearances. Your assets cannot be on your ass
Number six. Watch your credit. Good credit equals access opportunity,
lower costs, aim for a seven of the credit score.
You've heard me talk about this a million times, so
I will not belabor this right now, but I'll just
say this. If you go to the club tonight and
(44:29):
you see somebody you like and she's beautiful, she's fine,
he's handsome, said, oh damn, what's your name? Oh yeah,
that's cool and nice to meet you. What's your credit score?
If you get serious about somebody, don't just be fascinated
with their looks. It looks will go away in time.
That's your business partner for life. This is the only
where the mass should be multiplication, not addition. Two plus
(44:50):
two should equals equal more than four. If it doesn't,
what are you doing? If you're not better together, If
it doesn't equal six to eight or ten, what are
you doing? You can do bad all by yourself. That
Quincy Jones once told me God rest is soul. John.
He said, the only worse than being alone is wishing
that you were. Can I get an amen? Number seven
(45:11):
Side hustle smart beside hustle smart turn your skills or
passions into a second income stream. The easy ones are
uber lyft. You can rent out of room through Airbnb.
You can rent out that that RV is sitting in
your in your driveway. You rent out a spare car.
There's a lot of ways to be to You become
(45:33):
a notary, a notary public and do that as a
side hustle. There's a whole bunch of side hustles that
you can get into quickly to earn you some additional income.
Number eight by smart not big. Think value over luxury,
especially with cars and big ticket items. You don't want
to know one thousand, two thousand and three thousand dollars car. Note.
I mean that is crazy and people do this on
(45:55):
the regular. I just don't understand it. But I mean
in a car is also a diminishing value asset. It is.
It's bad debt because it decreases in value. You want
to have debt tied to things that increase in value,
which I call good debt. Mortgage, car, a car note,
a mortgage on the home, so on and so forth.
(46:16):
Even student loan I consider good debt because that's making
you smarter, which will allow you to produce more income
for yourself, earn better income. Number nine, Uh, learn before
you leave. Financial literacy is power. It is a Financial
literacy is a civil rights issue this generation. You know better,
you do better. So read, listen, and grow. Read my
book Financial Literacy for All, which is a national bestseller
(46:39):
in business finance, number one in the country since last April,
so coming up on a year of it being number one.
Buy it at Amazon, buy it at Walmart, buy it
at a black or minority owned bookstore. But get that
book and sign up to a financial coach. You get
(47:00):
operation to hope, tell him I sent you. They'll give
you one thousand dollars emergency savings account, sorry, one thousand
dollars scholarship to do for coaching and counseling. It is
an emergency savings account, by the way, because it's going
to save you money. Two ways of making money may
more spend less. This will help you spend less, thus
make more. If you're spaking making thirty six thousand dollars
(47:22):
a year and you and you're smoking three six packs
of cigarettes a week, two or three packs cigarettes, reason
going to Starbucks for coffee, you're you know, that's six
thousand dollars a year. That's ten percent of your income.
So go get a cured machine and stop smoking. You'll
live longer, be happier, and you can repurpose that that
(47:43):
six grand, twenty percent year income to do something meaningful
in your life. And tell your friends that follow this
podcast Number ten invest in yourself, mentorship, training, health. It
all pays dividends. So the economy feel like a foreign language,
but doesn't have to. When we understand the rules of
the game, we can win. Encourage all of your friends
(48:07):
to share this episode. Listen to this episode, Subscribe to
Money and Wealth, go to Operation Hope, get my book
Financial Ligency for All, become a civil rights leader. And
I want you to understand that there's a difference between
being broken being poor. Being broke as economic being. Being
poor as a disabling frame of mind, a depressed condition
(48:28):
of your spirit, and you must vow never ever ever
to be poor again. I also want you to know
that there is a business plan for Black America coming
on April fourth. We will be meeting in Memphis, Tennessee,
fifty seventh anniversary of the assassination of doctor Martin LA
King Junior. I am co chairing. I was asked the
CoA chair with the Memphis Mayor Paul Young, doctor Bernice King,
(48:51):
the daughter of doctor King, and the CEO of the
King Center, Ambassador Andrew J. Young, who built modern Atlanta
to the tenth lars economy in the country and the
biggest on me for black brown folks in the world.
That's a city that's successful at this scale. Five hundred
and eighty billion dollars I believe is the last number
for GDP for the city of Atlanta. He was on
that balcony with doctor King was assassinated. All of them
(49:13):
will be co hosting with me. The Undefinished Dream event
in Memphis, Tennessee is going to be online and I
will encourage you to to Dream Forward, which is the
official name for the event. Go to operational dot org
or just search dream Forward, Operation Hope and register for
(49:34):
this global town hall is virtual April fourth, one to
three pm Easter Standard Time, twelve to noon Central Time.
A lot of ballers, heroes, heroes that you love and
respect will be speaking that day. Killer Mike sam Audman,
Bernice King, just the I mean, Nicole Pullin, Ross, Ray McGuire,
(49:58):
Stride Massieu with a six richest man in Africa's Van Jones,
Bishop TD Jakes, the CEO of Walmart W. Millan, the
sound of Brown Ducket I was running a two tree
dollar company as a black woman, Charlemagne, that God, the
CEO of the President of Shopifi, Harley Finkelstein. Uh just,
I mean, just an unbelievable group of leaders. And it'll
(50:21):
be Republicans and Democrats, blacks and whites, rich and poor.
Billionaire next to millionaire. Next somebody's trying to buy some
there right with a business plan for America, the business
plan for Black America, which is a signal for the
other business plans we're going to create for Latino Americans,
for Native American Indians, for rural America. Uh to so
(50:43):
that we all can come up from nothing. Uh So
make sure you register for that. It's free. It is
our service for you. This is a silver rights blueprint
for all of us. It is a business plan built
on hope and it includes you. And we're going to
tell you how to come up. I'm telling you how
to come up into individually, We're going to tell you
(51:05):
how we're gonna come up as a group. And yeah,
I'm very excited. So see you there, John O'Brien, this
is Money and Wealth. Let's go change the world as
be this change we want to see in the world.
(51:32):
Money and Wealth with John O'Brien is a production of
the Black Effect Podcast Network. For more podcasts from the
Black Effect Podcast Network, visit the iHeartRadio app, Apple Podcasts,
or wherever you listen to your favorite shows of
Host
John Hope Bryant
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