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Lewis HowesLewis Howes

RECESSION: A Once In A Lifetime Opportunity To Build Wealth IS COMING! | Jaspreet Singh

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Jaspreet SinghguestLewis Howeshost
Jun 27, 20221h 40mWatch on YouTube

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Transcript

  1. 0:00 – 2:23

    Recessions as Black Friday for Investors

    1. JS

      The majority of people are very scared of slowdowns in the economy, slowdowns in the markets. However, for the minority of people, recessions, crashes are opportunity to-

    2. LH

      I think you gotta have a dream

    3. JS

      The School of Greatness.

    4. LH

      Really? [laughs] Yeah.

    5. JS

      Please welcome Lewis Howes.

    6. LH

      How can people overcome the fear and anxiety of everything crashing right now-

    7. JS

      [laughs]

    8. LH

      ... and start to set themselves up for peace and protection-

    9. JS

      Yeah

    10. LH

      ... moving forward?

    11. JS

      So [laughs] uh, there's the R word, recession, which when people hear that it gives them anxiety-

    12. LH

      Mm-hmm

    13. JS

      ... fear, panic. Makes people scared because you think of layoffs, companies going down. A couple things that I wanna mention regarding that is, you know, the, the majority of people are very scared of slowdowns in the economy, slowdowns in the markets. However, for the minority of people, recessions, crashes are opportunity to build wealth. You can think of it almost like a, a Black Friday for investors.

    14. LH

      Mm.

    15. JS

      So the first point that I wanna make regarding that is some people will use slowdowns as an opportunity to build immense amounts as of wealth, uh, immense amounts of wealth. More millionaires are made during recessions than any other time. So let's-

    16. LH

      How, how do they do it?

    17. JS

      So that's the thing. You wanna find the opportunity, and, and the way that you find the opportunity is first to understand how you get there because history doesn't repeat itself, but it does rhyme. And so what happens is people say, "Oh, this happened in 2020, so it must happen again," or, "This happened-

    18. LH

      Mm-hmm

    19. JS

      ... in 2008, so this is probably gonna happen," or, "This happened in 2001." That's not how it works. You have to understand what happened and how you're getting to where you are right now. That way you can look for the new opportunity because the opportunity is gonna be similar but different.

    20. LH

      Mm-hmm.

    21. JS

      And you wanna be ready when times are okay and good and prepared. That way when things go bad, you can come in and pounce on the opportunity and take advantage of it.

    22. LH

      So you got the stock market, which is, you know, have... it looks like record lows. It seems like every week it just keeps going down. You've got the crypto market, which, uh, and the NFT space-

    23. JS

      Yeah

    24. LH

      ... which just seems like it's going down and down, deeper into a hole. You've got the housing market, which seems like it's starting to take a turn, uh, and might pop in this bubble. What... where is the biggest opportunity right now?

  2. 2:23 – 7:18

    How Money Printing Created Today's Inflation

    1. JS

      Sure. So let's talk about how we got here-

    2. LH

      Yes

    3. JS

      ... so you can see where the opportunity will be. So in the past, for the number, last number of decades, any time you saw an economic slowdown, the response was to create inflation.

    4. LH

      Uh-huh.

    5. JS

      The response was to stimulate. So go back to 2001. When the dot-com bubble burst, we saw interest rates get cut. There was stimulus by the Federal Reserve Bank. So any time you inject more money into the economy, it creates inflation. Same thing happened in 2008. The 2008 bubble, real estate bubble burst, and then we saw a new quantitative easing. We saw cutting of interest rates. More money was injected into the economy. Same thing in 2020 on a extremely bigger, much bigger [laughs] level.

    6. LH

      Right.

    7. JS

      2008 was the largest quantitative easing in the history of time, and 2020 blew past that.

    8. LH

      It was like 5, 10 times more, right?

    9. JS

      It was significantly more. And, uh, so what happens is when you create more money, it reduces the value of your dollars. This is what inflation is.

    10. LH

      Mm.

    11. JS

      Inflation comes from the word inflate.

    12. LH

      Mm.

    13. JS

      So when you inflate-

    14. LH

      So we print a lot of money to put it into the economy, right? New money, which creates inflation, correct?

    15. JS

      Right, and it, it... the value of your dollar goes down, causing the price of things to go up. So when two... 2020 happened, we started printing more money and injecting this into the stock market, into corporations, and into people in the form of stimulus checks and unemployment.

    16. LH

      Mm.

    17. JS

      So what did that do? Well, in 2020 we saw the fastest and most severe stock market crash in history. It exceeded the rate of the Great Depression.

    18. LH

      Wow.

    19. JS

      And then what happened? The Fed opened up the money printer-

    20. LH

      Boom

    21. JS

      ... and boom, shot right back up. It was the fastest stock market growth in the history of time, which if you think about that, we had the fastest stock market crash in the history of time, and then we had the fastest stock market recovery in the history-

    22. LH

      Wow

    23. JS

      ... of time. How is that possible? Well, we printed an insane amount of new money, and when that happened, we created something called unlimited quantitative easing, where they essentially just said that they would print and do whatever it takes to help recover markets. Well, when you start printing all of this money without producing more products, because now, remember, the world is shut down, what happens? We have people who have money and nothing's being produced.

    24. LH

      Uh-huh.

    25. JS

      So now if you have money and you can buy stuff, but nothing's being produced, what's gonna happen? You start shopping, and things get bought, and now all of a sudden, companies can't keep producing the produ- products that they had before. Now you start to create supply chain issues.

    26. LH

      Uh-huh.

    27. JS

      So now this started creating supply chain issues, and then this caused the price of things to go up even more because now companies say, "Well, I don't have more mugs to sell you. I only have a few, so I'm gonna have to raise the price of these mugs." And now you start to go down this inflationary spiral because now that p- people need more money to buy things, they go to their boss and they say, "Hey, look, I need more money."

    28. LH

      Right, 'cause-

    29. JS

      It's more expensive to survive

    30. LH

      ... yeah.

  3. 7:18 – 14:25

    The Fed, Interest Rates, and the Hidden Tax

    1. JS

      So that's what's happening in terms of money. We had an insane amount of money printing being done, and in addition to that, we also saw interest rates get cut. What are interest rates, and how does that have anything to do with inflation? Well, the Federal Reserve Bank is the Federal Reserve Bank. However, they're not federal. It says so on their website. They're not a reserve-

    2. LH

      Mm

    3. JS

      ... because they don't keep any cash reserves, and they're not a bank. You and I can't go there to deposit money or do any banking.

    4. LH

      Right.

    5. JS

      So the Federal Reserve Bank, while it's not federal or reserve or a bank, they control our monetary supply. They control our money. There's two ways that they can do that. One is through interest rates, and the other is through printing money. So through interest rates, they have the ability to raise and cut interest rates. When we are in a slowing economy, a recession, they cut interest rates to stimulate spending because our economy runs on spending. If I have $1,000 in my pocket and I go to Amazon and I spend this $1,000, well, Amazon has more money to hire more employees, invest in more infrastructure-

    6. LH

      Mm

    7. JS

      ... do more things in the business. But if I keep that money in my pocket, they're not making as much money, and they can't keep growing. So our economy runs on spending, and when you cut interest rates, spending goes up. When mortgage rates drop to 2.5%, people wanna go and buy a home.

    8. LH

      Mm-hmm.

    9. JS

      People wanna go out and buy more cars. People wanna go out and spend money because it's not as expensive.

    10. LH

      Right.

    11. JS

      And businesses do the same thing. Institutions are gonna go out and borrow an insane amount of money because it's cheap. If I can borrow money, $100 million at 3% a year, and I can grow my company at 5% a year-

    12. LH

      [laughs]

    13. JS

      ... I'm gonna do that all day long, right? And that's what institutions did. So more money gets injected into the economy when interest rates are down. So that's what happens typically when you're in a recession. It creates more inflation-

    14. LH

      Mm-hmm

    15. JS

      ... right, because you're adding more money to the economy.

    16. LH

      Yes.

    17. JS

      However, it helps to stimulate the economy. Now, when you're in a growing economy and you wanna cool down the economy, you wanna cool down inflation, you do the opposite. You start raising interest rates, making it more expensive to buy a home, making it more expensive to live, and then you also can, in this case, remove cash out of the economy. This is what the Fed is trying to do now.

    18. LH

      How do you remove it out of the economy?

    19. JS

      So the Fed is, well, interest rates and then their balance sheet, and I'll talk about interest rates first-

    20. LH

      Yeah

    21. JS

      ... then I'll go into the balance sheet. So the Fed right now is raising interest rates because they wanna slow down inflation. So when you raise interest rates, what happens? It's more expensive to buy a home now.

    22. LH

      So less people buy.

    23. JS

      Less people buy. Less cash enters our economy, less institutions borrow money, less corporations borrow money. So borrowing goes down, less dollars enter our economy. The second side is the balance sheet. So this one's kind of interesting because you have to understand a little bit of how money works on the government side, without going into politics. So the government is not a for-profit entity. They don't sell products for money, right? What they do is they get their money from tax dollars.

    24. LH

      Yeah.

    25. JS

      People like you and me, right? We pay taxes, and then the government spends money. So when the government spends less than what they bring in, no problem. Their tax dollars cover it, and then they have a surplus in case one year they overspend.

    26. LH

      Yeah.

    27. JS

      But that's not what happens here. We spend more money than what we bring in, so that's why we have this national debt of $30 trillion, this national deficit. Um, and so how do you cover that? Well, if you spend more money than what you bring in, you can do a few things. You can raise taxes, which is gonna make people angry if your taxes go up, and so you can't always do that. Second is you can go out and you can borrow money. You can go and, uh, raise debt. So that's what the government does. They go borrow money from countries like China and Japan.

    28. LH

      Mm-hmm.

    29. JS

      But there's gonna be a limit to how much money you can borrow. So if you can't borrow enough money from different countries, then what's left? Well, then you can issue something called a treasury bond, which is where now anybody, people like you and me, anybody listening to this, can go and lend money to the United States government.

    30. LH

      Mm-hmm.

  4. 14:25 – 22:24

    Where Is the Opportunity? It Depends on the Fed

    1. LH

      So what would be the thing if there was a not- the biggest opportunity to create wealth right now?

    2. JS

      Yeah.

    3. LH

      What industry or sector would that be? Is that in the s- you know-

    4. JS

      Sure

    5. LH

      ... stocks? I feel like, I feel like nothing is stable. Like if you're gonna-

    6. JS

      Yeah

    7. LH

      ... put money in something, you could make a lot or you could lose it all-

    8. JS

      Sure

    9. LH

      ... within a month. Is it the stocks? Is it the crypto, NFT space? Is it the housing? Is it-

    10. JS

      Yeah

    11. LH

      ... you know, investing in yourself in another way? What would you say-

    12. JS

      [laughs]

    13. LH

      ... we should be investing in?

    14. JS

      Absolutely. So the first... So the answer's gonna be looking for where the opportunity happens.

    15. LH

      Okay.

    16. JS

      So 2008-

    17. LH

      Yes, tell me

    18. JS

      ... was real estate.

    19. LH

      Mm-hmm.

    20. JS

      Uh, that was the biggest real estate opportunity in, in our lifetimes. In 2020, it was stocks and crypto. In 2020, the stock market, from its bottom to the end of 2020, grew by 60%.

    21. LH

      [sighs]

    22. JS

      The crypto market grew by almost 600%. And so it's fi-

    23. LH

      But if you didn't get out, you probably-

    24. JS

      If you didn't get-

    25. LH

      ... got back to the-

    26. JS

      Of course

    27. LH

      ... yeah.

    28. JS

      But this is where, you know, again, the psychology of investing-

    29. LH

      Mm

    30. JS

      ... is so important. But the thing that you wanna pay attention to now is it's, it's... You wanna see where things are going.

  5. 22:24 – 27:27

    Stagflation, 10% Rates, and Pandemic Fraud

    1. LH

      How high do you think the, uh, interest rates could get to? What's the potential range you think?

    2. JS

      So let's talk about history. Uh, in 1970 was the last time we saw inflation this high, or in the late 1970s, closer to 19, uh, 80. And in that time, we were facing double-digit inflation. And in order to fight that inflation, the Federal Reserve then said, "Either we can fight the slowing economy, or we can fight the inflation." Similar issue. It was called stagflation. Stagflation is a very weird economic concept where you have a slowing economy, and you also have rising costs.

    3. LH

      Mm.

    4. JS

      So it's like the worst-case scenario.

    5. LH

      Sure.

    6. JS

      And so during that time, they said, "Okay, we have a slowing economy, and we have high inflation. We're gonna," say, "ignore the economy. We're gonna break down inflation because that will save our dollar. It'll save the currency." And so what did they do? They jacked up interest rates, and mortgage rates were almost 20%.

    7. LH

      What?

    8. JS

      Almost 20.

    9. LH

      When was the last time it was over 10?

    10. JS

      [laughs]

    11. LH

      You remember?

    12. JS

      Uh, in the '90s to early 2000s, around that time it was.

    13. LH

      Really?

    14. JS

      Or '90s probably-

    15. LH

      Yeah

    16. JS

      ... was the last time it was, it, it, over 10.

    17. LH

      So if it went over 10 now, what do you think would happen?

    18. JS

      If the Fed continues to jack up interest rates to bring it over 10%, home prices will have to go down. I mean, it's-

    19. LH

      Because people won't be buying

    20. JS

      ... you can't afford the home-

    21. LH

      Wow

    22. JS

      ... at the same interest rate today, and that would also significantly hurt businesses because the businesses that are relying on debt, uh, they're gonna see a-

    23. LH

      Mm

    24. JS

      ... big pain, a big crunch. And so that's where the, the Fed is facing a big dilemma. They're hoping that inflation will go down, but the question is how. Uh, they're hoping that it's still just supply chain. They're hoping that it's still just Russia. They're hoping that it's still just other issues. But the one issue they never talk about is the money printing and the stimulus, and that's the concern. It's we, if we really wanna get serious about fighting inflation, we might have to get more aggressive, and if we get more aggressive on inflation, it's gonna hurt the economy. Uh, even the, uh, a previous Federal Reserve chairman said that we need to crash the markets because we need to get serious on inflation.

    25. LH

      Wow.

    26. JS

      Because we don't wanna deal... A currency crisis would be even worse than just dealing with a recession. And so that's where it's what is gonna happen, and are we really that bad? And the last thing I wanna mention on that is the money printing that we saw happen in 2020, uh, it has just come out that it also led to the biggest financial fraud of America ever.

    27. LH

      Really? Why?

    28. JS

      Because people abused the system.

    29. LH

      Oh, yeah.

    30. JS

      So-

  6. 27:27 – 32:11

    Investing in a Downturn: Stocks, Crypto, and Timing

    1. JS

      Sure. So I think the more liquid and more active investments would be your, your liquid investments, things like stocks, things like cryptocurrency. So again, if you look at 2008, when the stock market crashed, started going down, it bottomed out in 2009, and then it started going up. So the 2008 crash happened, started in 2007, and, and it bottomed in 2009, and then it goes up. And by 2012, the stock market had fully recovered. But in 2012, that was when the housing market bottomed.

    2. LH

      Mm.

    3. JS

      So the housing market bottomed three years after the stock market crashed.

    4. LH

      Wow.

    5. JS

      And why? Well, the stock market has a lot of panic. It has a lot of emotions, and you can oversell very quickly because it's all emotions, right? When, when you see the headlines on the news talking about what's happening in the markets, people get scared and they start panicking.

    6. LH

      This is happening right now, yeah.

    7. JS

      And then you see assets go down, then you go, "Oh, my God, my, my asset's down 30%. I wanna sell my stocks." And then it keeps going down. And it, it... So it's a very emotional driven, and it can happen essentially in the blink of an eye 'cause you can buy and sell stocks in a second. The housing market doesn't work like that. The housing market has a much longer l- lag time 'cause it can take easily 30 to 90 days to buy and sell a home. And so y- you just understand that the housing market moves significantly slower. And so if interest rates, say, went up to 10%, uh, I have a strong hunch that the stock market would get hurt bad, and I think there would be a lot of opportunity there. But the question is-

    8. LH

      In the stock market

    9. JS

      ... in the stock market. Now-

    10. LH

      To invest then in the stock market.

    11. JS

      Yes.

    12. LH

      Yeah.

    13. JS

      And that's if you believe in the American economy. I do. If you think the American economy's gonna be strong in 10 years, 20 years, then there's opportunity there for you. And so what that would mean for me is looking for strong companies that are not going into bankruptcy that I can find opportunity to purchase. And if you're not interested in investing in individual companies, if you're not willing to spend the time doing that, because I think the majority of people should not be investing in individual companies-

    14. LH

      Right

    15. JS

      ... because they're not willing to put in the time, effort, research, and have the psychology to do that.

    16. LH

      Yes.

    17. JS

      Then you can just look into an ETF that gives you exposure to the general stock market-

    18. LH

      Mm

    19. JS

      ... the S&P 500, which is the biggest 500 companies on the stock market.

    20. LH

      Wow.

    21. JS

      And now you're just investing in a piece of America, and y- you're able to buy it at a discounted price. So that's what I would say there. And then if you're talking about cryptocurrency, you have to first... I'm not here to tell you believe in crypto or don't believe in crypto. That's not what I'm here to do. If you believe in crypto, I do, I invest in crypto. If you believe in the technology, you have to be willing to weather the storm.

    22. LH

      Mm-hmm.

    23. JS

      And you have to be willing to understand that, you know, price makes a big, changes the sentiment of crypto. Because when prices of crypto go down, people think crypto is, is fake. It doesn't matter. When prices of crypto go up, people think, "Oh, it's the future." [laughs] And so-

    24. LH

      Right

    25. JS

      ... if you really wanna be an investor-

    26. LH

      Mm

    27. JS

      ... you have to be able to cut through that emotion and cut through the noise-

    28. LH

      Mm-hmm

    29. JS

      ... and understand, "Okay, uh, I like the blockchain. I like the technology. I'm not investing in the meme stuff. I'm investing in something that has actual value, that can actually create change," and then that can be an investment for you. But now in terms of timing, I wanna make sure I mention this because a big mistake that happens, and this happened in big part in 2020- Is you can't time the market

    30. LH

      Right

  7. 32:11 – 38:19

    Buying a Home: Affordability, Renter Nation, and ARMs

    1. LH

      is it, in your opinion, would you buy a home, uh, when interest rates is over... Or I mean, uh, yeah, when interest rates is over 10%? Or you feel like even though you're getting at a massive discount, you're paying more every month. Would you consider that or you just wait until interest rates go down?

    2. JS

      So I look at home buying very differently than the majority of people. I look at buying a home the way I buy a shirt.

    3. LH

      Mm.

    4. JS

      For me, a home is not an asset, it's a liability.

    5. LH

      Mm-hmm.

    6. JS

      So what does that mean? I want to buy a home because I want to create memories.

    7. LH

      Yes.

    8. JS

      I want to buy an investment property or an investment because I want to make money. So if you're buying a home because you think, "Oh, I want to get rich because of my home," I think you're looking at it the wrong way.

    9. LH

      Mm-hmm.

    10. JS

      Because you should be looking at your home as, "I want to make memories here. I want to live here and I want to grow my family here and I want to spend time here." If that's the reason why you want to buy a home, what you should be paying attention to is not what's going on in the markets, not what's going on with interest rates, but instead what you should do is say, "Can I afford it?"

    11. LH

      Right.

    12. JS

      And what does that mean? Can I afford the down payment? Can I afford the monthly payment?

    13. LH

      Property taxes.

    14. JS

      Can I afford the property tax?

    15. LH

      The fix up.

    16. JS

      The fix up.

    17. LH

      [laughs]

    18. JS

      The move-in costs and then, you know, you move in, like, like, I mean the furniture and upgrades-

    19. LH

      The furniture, everything, man

    20. JS

      ... all that. So if you can afford it, then you buy. If you can't afford it, if you're stretching yourself too thin, you don't buy because what happens to so many people is you get sucked into trying to time the market. But again, if interest rates drop and you own a home, you can refinance.

    21. LH

      Right.

    22. JS

      And so remember, i- it's understanding the-

    23. LH

      So it's almost, almost good to buy it when interest rates are high if you can get the house on discount. And then if in a year or two the, the interest rates drop in half you can refinance.

    24. JS

      Just as- make sure you can afford it.

    25. LH

      Right, right, right.

    26. JS

      That's the biggest thing.

    27. LH

      Sure.

    28. JS

      You have to be able to afford it because if you are stretching yourself too thin going paycheck to paycheck-

    29. LH

      Yeah, don't do it

    30. JS

      ... to live in a home, you're hurting yourself. Because now what you're doing, you don't have the ability to invest in other places. You cannot invest your money and-

  8. 38:19 – 46:33

    Turning $1,000 into $100,000: Invest in Yourself

    1. LH

      Right. I'm curious, here's a question, uh, we got from people on YouTube. If someone has between 1,000 and $10,000 today-

    2. JS

      Yeah

    3. LH

      ... to invest, they can spend it on whatever they want-

    4. JS

      Yeah

    5. LH

      ... and they had to turn it into 100,000 within three years-

    6. JS

      Ooh, okay

    7. LH

      ... what steps would they, should they take? A- and obviously this is a, you know, not a guarantee-

    8. JS

      Sure

    9. LH

      ... but if you're like, "You have to turn this 1,000 into 100,000, or 10,000 into 100,000," what would you invest in right now and how would you manage it over the next couple of years?

    10. JS

      Sure. So I'm gonna give you kind of a, a longer answer than maybe you were hoping for on this one.

    11. LH

      Give it to me.

    12. JS

      [laughs] I'm gonna start by telling you what you should not do.

    13. LH

      Okay.

    14. JS

      Uh, because the first time I remember, um, I've, I had $1,000 extra in my bank account, I was in high school. And what I did with that is I took the $1,000 and I went out and I bought a watch.

    15. LH

      Mm, no, don't do that.

    16. JS

      And... Yeah. A- and this watch was very studded up. It was all crystals, and I was like, "Ooh, it's a nice watch."

    17. LH

      Clean.

    18. JS

      So what happened with... Yeah. [laughs]

    19. LH

      [laughs]

    20. JS

      What happened with that watch? Well, I made that watch company richer, I made the jewelry store owner richer, and now that $1,000 watch today is may- worth maybe 50 bucks, right?

    21. LH

      Ooh.

    22. JS

      It was j- it was just a show. So my value of my investment dropped like a rock, but now these companies made money which now they could take that and invest in more products, more inventory, more marketing, more whatever. So the first thing is you got to understand that you want to put it in something that's gonna help make you more money. So I'll give you my personal experience, because I saw the biggest returns by investing in me, but that will be more of an active investment, and then you have the opportunity for a passive investment-

    23. LH

      Yes

    24. JS

      ... which is why it's longer answer than what you were probably hoping for, but I'll try to get to all the answers there. So I feel like everybody, um, who... Especially if you're, had the entrepreneurial mindset, you go through these phases where you first go through this, like, I'm a hustler, side hustler phase-

    25. LH

      Yeah

    26. JS

      ... and then maybe you become, like, a solopreneur, and then you become an entrepreneur, and then you become a small business owner, and then you kind of go to that business owner route.

    27. LH

      Yes.

    28. JS

      So you kind of go through these phases because initially, when I first started as a side hustler, I didn't know what entrepreneurship was.

    29. LH

      Mm-hmm.

    30. JS

      I was just trying to make some money.

  9. 46:33 – 49:39

    Family Roots, Bullying, and Being 'Stupid' Enough to Try

    1. JS

      And I, but I did take-

    2. LH

      Mm

    3. JS

      ... an acting class. Uh, I, I, I was in law school. So I was in law school part-time. I was working on my business full-time, and then I took an acting class in the evenings, night school, because I was like, "I've never, I've never talked in front of a camera before."

    4. LH

      Yeah.

    5. JS

      "I, I'm not even a good public speaker. Um, I don't know how to present myself. I don't even know how to hit the on button on a camera. How am I supposed to do this?" So I took an acting class because I was like, "Well, I'm willing to learn. I'm willing to try." So you have to be willing to get uncomfortable, and you have to be willing to take that risk. And this is gonna... I don't know if this is gonna offend people or I'm gonna say a bad word, but the reason why I think I've been able to become successful is because I'm stupid.

    6. LH

      Oh. [laughs]

    7. JS

      My whole life I've been told just-

    8. LH

      Me and you both, man. [laughs]

    9. JS

      I've been told, "Jaspreet, you're stupid. Jaspreet, you're stupid. Why would you wanna do that?" And you know what? That's the reason why I am where I am today, is because I'm stupid.

    10. LH

      Mm-hmm.

    11. JS

      Because I'm willing to... I never looked at the risk.

    12. LH

      Right.

    13. JS

      And you call it stupidity, but for me is I just saw the opportunity as I know I want to achieve something bigger. Because I saw how hard my parents had.

    14. LH

      Mm-hmm.

    15. JS

      I saw how hard my grandparents had.

    16. LH

      Yeah.

    17. JS

      My grandparents were refugees.

    18. LH

      Yeah.

    19. JS

      They lost their homes. They lost everything. They had to fight for their lives. And so I saw the things that my family had to go through. I, my, my grandparents raised me. They lived with me. So I lived with my grandparents, not my parents, so I heard their stories, talked about the struggles, and that was where I started to get my basis of financial education. 'Cause my grandfather would tell me, and he actually repeated this to me a, a couple weeks ago when I was on the phone with him, and he was like, "You know, the, the biggest and worst disease is poorness."

    20. LH

      Mm.

    21. JS

      Because he said, "I, I grew up and I saw extreme poverty." So my family's from a state in India-

    22. LH

      Wow

    23. JS

      ... called Punjab.

    24. LH

      Yep.

    25. JS

      And in 1947, our home, the state of Punjab, was severed by the government. And if you were a Sikh, a member of the religion that I am, and you're on the west side of Punjab, you had to migrate east, otherwise you were gonna be killed. Uh, so my grandparents were on the west side. And you literally had to, like, run. Like, my grandfather, all he had was the clothes on his back and a sword in his hand, and as they were coming across, they, they got attacked by a mob. And he saw his, uh, uncle get his head chopped open right in front of him.

    26. LH

      No way.

    27. JS

      They had to fight. And so he put his uncle on a horse- And that was the end. And so he-

    28. LH

      Holy cow

    29. JS

      ... he got to the new side of India now, and he's there. He lost his shoes on the way. He has no home, no money, no anything. And so he says, "I saw extreme poorness." And when you're in that level of poorness, forget f- helping other people. You can't even feed yourself. How can you feed your family? If you can't feed your family, you can't feed another hungry person. And so that's what he talks about, what he, you know, and that's what my initial, like-

    30. LH

      Wow

  10. 49:39 – 55:58

    Managing Emotions and Sticking to a Strategy

    1. LH

      Um, I, I'm curious. This is something I don't think many people talk about, or I don't hear people talk about, the emotional side around money, and the fear and emotions that are tied to money when you say, "Okay, here's a couple thousand dollars that I have in my, my bank account. I'm gonna invest some of this." And then you see it in the stock market crash-

    2. JS

      Crash, yeah

    3. LH

      ... or go down, or you lose half of it in a week. How does someone manage the emotions and the visceral response to when their money goes up and also goes down-

    4. JS

      Yeah

    5. LH

      ... in, in an investment?

    6. JS

      So you have to know your strategy, and you have to be willing to stick to the strategy as, and trust your strategy. So that means when times are good, you need to spend your time being, learning, get educated, and believe your strategy. Because if you just start switching your strategy in the middle of times, you are gonna be the one paying the price. The stock market is a place that transfers money from the patient to the impatient. And so if you are impatient because you're like, "Oh, things are going wrong temporarily," and you sell, who, what happens? Someone else can pick up your investment at a discounted price. So that's the first thing that you have to understand, is you have to understand the strategy and be willing to stick with it, and make sure that it's been time-tested. And [laughs] again, history doesn't repeat itself, but it rhymes, and you can see the success of certain strategies through previous downward cycles. Downward cycles happen. It, it, it's a fact. You know what I mean? Every eight to 12 years we see some sort of economic slowdown, we see some sort of market crash. This is nothing new. This is why, uh, for successful investors, they love recessions, they love market crashes-

    7. LH

      Mm

    8. JS

      ... because it gives them an opportunity to come and buy. It's like Black Friday, right, for investors.

    9. LH

      Yeah, yeah.

    10. JS

      So the first thing you have to understand is that. Um, and then that will help you kinda just close your eyes. Remember, these are just day-to-day swings. You only lose money if you sell or if your investment goes bankrupt.

    11. LH

      [laughs]

    12. JS

      So you wanna make sure it's not gonna bankrupt, and then understand that. But then on the flip side, you know, you talk about the actual emotions. I'll tell you, it was difficult. You know, because I had very high expectations on me to go out and become a professional. I, I became an attorney because essentially the conversation was, "If you do not become a doctor, then you're gonna lose all pride in the family. So at least become an attorney."

    13. LH

      [laughs]

    14. JS

      So it's something.

    15. LH

      Right, right.

    16. JS

      And, and it was difficult.

    17. LH

      Second best.

    18. JS

      Yeah.

    19. LH

      Yeah, yeah.

    20. JS

      Exactly. And-

    21. LH

      And if you're not that, you're a failure.

    22. JS

      Yeah, [laughs] exactly.

    23. LH

      [laughs]

    24. JS

      So, you know, it was tough. And I, you know, for me, I was like, "Okay, well, I can go to law school part-time, which means I can work on my business full-time."

    25. LH

      Mm.

    26. JS

      However, I wasn't the best student in law school, and the reason was is because I was devoting a lot of my time and energy into the business.

    27. LH

      On the business, yeah.

    28. JS

      Now, I did good in law school. I'm not g- like, I actually did really well on the bar exam. I enjoyed learning. I love learning, but I knew that in the back of my mind, "Oh, my God, if I graduate law school and things don't work, uh, I don't know how I'm gonna work as an attorney. Like, I'm, I'm gonna be like the bottom of the barrel. Like, I, I don't know what I'm gonna do." 'Cause I, I, I, I don't, like, know the traditional how to work as an attorney. I'm sure I could figure it out, but I don't know what I would do. And so I remember I was sitting there and I was like, "Oh, my God, like, when I'm done with law school, like, it's, it's over." Like, I was already making decent money, so I was fortunate there, but I was like-

    29. LH

      Mm

    30. JS

      ... "What if this is just, like, just temporary? What if things go down and I don't have any, like, security and that's it?" And I, I, I would have so much anxiety. I couldn't sleep at night. I would wake up in the middle of the night multiple times and I would be shaking, and I was like, "What if, uh, not only am I gonna, like, financially not be able to take care of myself, how am I gonna take care of my parents? How am I gonna take care of my family? How am I gonna... What am I gonna tell people?-

  11. 55:58 – 1:03:06

    Habits of Future Wealth: Mindset, Discipline, Learning

    1. LH

      Going along with that, what would you say if you saw someone now, say they're 20 or maybe they're 30 or whatever age, doesn't matter.

    2. JS

      Yeah.

    3. LH

      But they don't have a lot of money right now. Let's say they're just making a, a normal amount of money, right?

    4. JS

      Yeah.

    5. LH

      But they have certain habits and behaviors-

    6. JS

      Yeah

    7. LH

      ... and beliefs and thought proces- processes that you witness, and you could say, "Wow, if you follow these things, you have the ability to make a lot of money one day." What would be those behaviors or habits that would determine-

    8. JS

      Sure

    9. LH

      ... if someone has the ability to be rich?

    10. JS

      The first thing is mindset.

    11. LH

      Mm.

    12. JS

      That's what I call, you know, my channel, me, my, the Minority Mindset. You have to believe it's possible for you, uh, because if you don't believe it's possible for you, you can have all the resources, you can have all the drive, but you'll never be able to do it because your mind-

    13. LH

      Mm

    14. JS

      ... is gonna stop you. Your mind dictates your actions. And so you first have to believe that somebody like you can do it from your position and know that, "Hey, I will do whatever it takes." Now, if you have the mindset, then you have that I will do whatever it takes, the discipline, and then the willing to learn, nothing can stop you. So the discipline means that you're willing to put in work. You know, a lot of people say, "Don't work hard, work smart," and I think this is a whole bunch of crap.

    15. LH

      [laughs]

    16. JS

      You know, like, you can work as smart as you want, but if you're not willing to work hard, y- you're gonna very much limit your success, uh, a- and limit everything in your life. Uh, you have to be willing to work hard.

    17. LH

      I don't know anyone that didn't put in a lot of hard work for a period of time-

    18. JS

      Yeah. [laughs]

    19. LH

      ... until they learned how to manage and delegate and optimize-

    20. JS

      Exactly

    21. LH

      ... with resources and scale and time to work smarter.

    22. JS

      100%.

    23. LH

      But they had to work hard at some point.

    24. JS

      In order to get there. Once you get there-

    25. LH

      Yes

    26. JS

      ... now you can scale back-

    27. LH

      Yeah, yeah, yeah

    28. JS

      ... and now you can, you know, reap the fruits of your labor, but you have to be willing to-

    29. LH

      Yeah

    30. JS

      ... put in the work, the hard work.

  12. 1:03:06 – 1:12:21

    Money Myths, Liabilities, and the 75/15/10 Plan

    1. JS

      Well, the first thing that I, I would say, I don't know if it's a myth, but I would say that the first thing everyone has to understand is what money is. And I, I don't mean in terms of like, uh, in terms of wealth, but like money is just paper. It doesn't make you a good person. It doesn't make you a bad person. It just, it's paper. And we talk about all these, uh, insecurities people have with money. I grew up being told, "Don't talk about money. Don't worry about money. Don't stress about money." Yet, here I am seeing my parents work their butt off every single day. So-

    2. LH

      Trying to make money

    3. JS

      ... trying to make money, and it doesn't make sense. How am I supposed to not worry about money, and you want me to become a doctor because, you know, you read those, uh-

    4. LH

      [laughs]

    5. JS

      If you go to those, uh, career fairs, they show you the different careers, right? And doctor is always number one, the highest income. So why am I doing this if it's because of the income instead of because I love it, or do something that I love? Why not go for what I-

    6. LH

      Or because I wanna help people.

    7. JS

      Yeah.

    8. LH

      Or you wanna save lives.

    9. JS

      Exactly.

    10. LH

      Yeah.

    11. JS

      And, and what's crazy is if you understand money, you become financially educated, you're willing to talk about it. Well, now you can be financially stable doing whatever you want, and you can follow something you love and still be financially okay. Because we assume that you have to have this in order to make money. You have to have this job in order to make good money. You have to have this career if you wanna be financially stable, but that's a complete lie.

    12. LH

      Yeah.

    13. JS

      But that goes down to, you know, us being willing to talk about money. And, you know, I talked about this in our last interview, but, you know, money is one part of our lives. And w- the reason why people are scared to talk about it is because we're insecure about it, and that's because we don't understand how money plays a part in our lives. It's one aspect. I say that there's four. You have to be physically healthy, mentally healthy, spiritually healthy, and then financially healthy.

    14. LH

      Mm-hmm.

    15. JS

      If you're not financially healthy, well, that can make everything else much more miserable because you can't pay your bills. But if you're financially healthy, you're rich, but you have nothing else, more money just makes you more miserable.

    16. LH

      Mm-hmm.

    17. JS

      So you need to live a holistic life and understand how money plays a part in your life, that way the, the finances can have the biggest power. And then you understand that more money just amplifies who you are. It's like fire. It's like fuel. It fuels your fire. If you're a good person and you have more money, you have a tool to do more good. If you're a bad person and you have more money, you have a tool to do more bad.

    18. LH

      Yeah.

    19. JS

      Which is why we need more good people with money.

    20. LH

      [laughs] Exactly.

    21. JS

      How do we do that?

    22. LH

      Well, yeah.

    23. JS

      Get educated.

    24. LH

      A lot of people just say that money exposes who you really are.

    25. JS

      Exactly.

    26. LH

      It amplifies who you are.

    27. JS

      Right.

    28. LH

      So people can see, um, you know, whether you're that good person or a bad person or whatever it may be in between. But first off, understanding what money is-

    29. JS

      Yeah

    30. LH

      ... is what you had to learn.

  13. 1:12:21 – 1:18:56

    Net Worth vs. Self-Worth, Patience and Perseverance

    1. LH

      Here's one that I think a lot of people do, and I think it hurts them in a big way. How does someone not make their net worth attached to their self-worth?

    2. JS

      That's a good one. You know-

    3. LH

      Meaning how do they believe in themselves, have confidence, uh, have, you know, love for themselves-

    4. JS

      Yeah

    5. LH

      ... when they're not making that much? Maybe they're in a transition. Maybe they lost their job.

    6. JS

      Yeah.

    7. LH

      Maybe they're just starting out.

    8. JS

      Sure. So-

    9. LH

      And how do they also, when they start making some cash, not tie their bank account number to their self-worth?

    10. JS

      So when you fail at something, you don't become a failure as a person. You failed at a task And in order to become successful at something, you have to fail at a lot of tasks.

    11. LH

      Mm-hmm.

    12. JS

      And so the first thing is you have to understand that about yourself, is that just because something didn't work, just because you failed at something does not mean that you are a failure.

    13. LH

      Mm.

    14. JS

      Maybe you failed at a task. I've failed at a ton of things.

    15. LH

      Yes, yes.

    16. JS

      I'm sure you have, too. You know, you have to screw up a lot, and that's how you find the good. So now when it comes to net worth, if you want me to be completely honest, your net worth is pretty useless. It's a worthless number. It means nothing. It means less than nothing because what is net worth? It's a paper number. If I have a million dollars net worth in the stock market today, tomorrow it could be worth 400,000.

    17. LH

      Mm-hmm.

    18. JS

      It doesn't... If, if you are valuing your life, and even worse, if you are spending based off of your net worth, you're living a very dangerous life. And some people do do this because they say, "Oh, I'm worth a million dollars, so I'm gonna go out and live a million dollar lifestyle." You don't have a million dollars. You're just worth a million dollars. You don't have income coming in. You're just worth this amount of money, and so you go and borrow a, a ton of money, and you start living this million dollar lifestyle, and then things go down, and now you're the first one to lose your shirt.

    19. LH

      Mm-hmm.

    20. JS

      So the thing that I want you to remember is first, regarding the failure, you're not a failure. Uh, just because you failed at a task does not mean you're a failure. It's actually a good thing you failed because that means you're one step closer to finding that success. And then second, regarding the actual net worth number, look, this is just temporary. Everything is temporary, and you have the opportunity to build something a lot bigger. You have to have the right mindset. And if you are here in America, you're in a first world country, you have the opportunity-

    21. LH

      Mm

    22. JS

      ... to do that. But you have to be willing to learn and be willing to give it time. So you have to be patient but also impatient at the same time. Patient in the sense that you have to understand that get rich quick is m- majority of the time a big scam.

    23. LH

      Yes.

    24. JS

      It doesn't work. Um, it makes the people selling the get-rich-quick rich-

    25. LH

      [laughs] And you broke

    26. JS

      ... and you, keep you broke.

    27. LH

      [laughs]

    28. JS

      Uh, so the first thing you have to understand is that. But then second is you wanna be impatient where you gotta... It's gonna fuel that drive, fuel that work ethic, fuel that discipline, and you have to be willing to keep going, you know? I don't... If you would've told me 15 years ago or 10 years ago, "Hey, man, you're gonna be interviewing with Lewis on this show," I, I would never thought that's possible. Like, you know, I grew up being told somebody like me can't do this, somebody like... You know, I remember talking to my own family members, like, "You can never be a CEO of a company."

    29. LH

      Mm.

    30. JS

      Uh, y- somebody like you can't do that. You have no business background.

  14. 1:18:56 – 1:35:28

    Money, Happiness, and Mental Health

    1. LH

      What would you say on a scale of one to 10 how much you love yourself today? 10 being You have ultimate love for yourself, in not in an egotistical way.

    2. JS

      Yeah

    3. LH

      One being you, you know, hate yourself. Where would you be on the one to 10 scale?

    4. JS

      I, I think, I mean, I don't wanna be like mean, like, like, oh, I'm like overly l- narcissistic, but I, I love myself. And I never asked myself that question because I don't think... I, I was very fortunate that I never really had to struggle with happiness.

    5. LH

      Really?

    6. JS

      No. And, and I-

    7. LH

      Even when your parents were kind of talking the way they did and like-

    8. JS

      That was tough. It was tough. But it never really made me unhappy, because I think why is I had a group of guys that I was friends with, a few DJ friends, and we were all kind of like almost like rebels, but we knew we weren't doing bad things. We were like, we wanna become successful-

    9. LH

      Sure

    10. JS

      ... but just no one sees our vision. So we all just kinda like, we were, we were friends. I, I had a really good community.

    11. LH

      Okay.

    12. JS

      And I think that really helped me because, you know, they, sometimes I would go sleep in their basement. I was like, "Man, this is like my mom told me this, or my dad does not believe in me." And they were like... You know? And they were in the same boat as me. Like, they're like, "Dude, I don't know what I'm gonna do either." And look, all of us now are, are doing very well, and we joke around about that where it's like, "Man, I got, you know, a, a lot of trouble with my parents. I'm sleeping in your basement."

    13. LH

      [laughs]

    14. JS

      "Now you come into my basement." And, um, so it, it was tough, but I had a lot of fun along the way, man.

    15. LH

      Yeah.

    16. JS

      Like, 'cause when-

    17. LH

      So money, you never attached money to happiness?

    18. JS

      Never. I think actually, you know, [laughs] I'll, I'll... I think more money actually maybe have reduced potential happiness.

    19. LH

      Really?

    20. JS

      Yeah. And I think the reason why is because some things had happened in my life that I did not expect. And I, and I thought, 'cause we were all like, we wanna become successful, but we loved the journey. Like it was, we were having a great time. But I think what happened was I had some like really tough realizations, and I've never talked about this publicly-

    21. LH

      Hmm

    22. JS

      ... but I'll do it now. So when I was, uh, y- Minority Mindset was growing and I was like, "You know, I'm gonna really build this now," and we were getting close to 100,000 subscribers, and we were, we're going viral, and it's like, wow, you know, we made it.

    23. LH

      Yeah.

    24. JS

      We're about to hit it.

    25. LH

      100,000's hard to do. That first 100,000 is-

    26. JS

      It's very difficult

    27. LH

      ... really hard.

    28. JS

      And, um, it was, I was right about to hit it, and I come home and, um, we're having dinner and my dad, I knew something was wrong, and he, and he looks at me and he says, um, "Your mom has cancer."

    29. LH

      [gasps] Hmm.

    30. JS

      And all of a sudden it's like s- forget the YouTube channel. Forget the investment. Like, forget it all. Like, I was like, "Are you serious?" I was like, "Did you get a second opinion?" And, uh, um, you know, it w- it was very tough. And so that next week, my mom's in the hospital in the operating room.

  15. 1:35:28 – 1:40:27

    Financial Education, Future Topics, and Closing

    1. JS

      And it's under... This, this is where that lack of financial education-

    2. LH

      Wow

    3. JS

      ... is just so deep-rooted. And I said this last, I'm gonna say it again. It's because it is so profitable to keep you poor.

    4. LH

      Mm.

    5. JS

      It's profitable to keep you financially uneducated. And it, it sucks, but it's the reality. So what do we do? Now get financially educated. Because at the end of the day-

    6. LH

      Mm-hmm

    7. JS

      ... money speaks.

    8. LH

      Yeah.

    9. JS

      Money talks.

    10. LH

      Yeah.

    11. JS

      You can hate it, you can love it, but it's the reality. You know what? People listen to what I have to say now. Why? Be- um, because I got money. [laughs]

    12. LH

      Right, right, right.

    13. JS

      You know, it is, it is what it is.

    14. LH

      Yes.

    15. JS

      Uh, you know, it's like gravity.

    16. LH

      There's some credibility to it, too, you know?

    17. JS

      Sure.

    18. LH

      It builds credibility-

    19. JS

      Absolutely

    20. LH

      ... authority, trust-

    21. JS

      Yes

    22. LH

      ... all these different things.

    23. JS

      And, and I hope that, you know, through my genuineness I've been able to build that.

    24. LH

      Yeah, man.

    25. JS

      But, you know, I, I talk about the system like gravity.

    26. LH

      Yes.

    27. JS

      It is what it is. You can fight it, or you can understand it.

    28. LH

      Mm.

    29. JS

      Learn the rules to the game.

    30. LH

      And leverage it.

Episode duration: 1:40:27

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