America’s long-term challenge #2: the looming retirement crisis

Last week, the financial services giant Northwestern Mutual released new data showing that 1 in 3 Americans has less than $5,000 in retirement savings.

It’s an unfortunately familiar story. And Northwestern Mutual’s data is entirely aligned with other research we’ve seen in the past, including our own.

The Federal Reserve’s most recent Survey of Consumer Finances, for example, shows that the median bank balance among US consumers is just $2,900.

And Bank[...] Click here to continue reading

It gets worse: Tesla now has to compete with $50,000 electric BMWs going for $54/month

As if things weren’t bad enough for beleaguered Tesla…

The company lost $1.1 billion in cash in the last quarter, executives are leaving the company in droves, it’s facing production issues with its Model 3 and, as I recently discussed, Elon Musk insulted analysts on the latest earnings call by dismissing their questions – regarding the company’s survival – as “boring” and “boneheaded,” (just after shareholders approved his obscenely large pay package).

Now,[...] Click here to continue reading

Breaking down America’s worst long-term challenges: #1- Debt.

On October 22, 1981, the national debt in the United States crossed the $1 trillion threshold for the first time in history.

It took nearly two centuries to reach that unfortunate milestone.

And over that time the country had been through a revolution, civil war, two world wars, the Great Depression, the nuclear arms race… plus dozens of other wars, financial panics, and economic crises.

Today, the national debt stands at more[...] Click here to continue reading

One family’s TWO YEAR nightmare of having their child taken by the state

This one is really infuriating.

It started back in 2016… on April 6th to be specific. A Philadelphia-area mother walked into a clinic because her 7-month old baby was being excessively fussy.

The doctor performed a cursory examination, concluded the baby had an ear infection, and prescribed an antibiotic.

Later that day, the mother noticed what seemed like a bone popping in the baby’s side and thought this might be the source[...] Click here to continue reading

Meet America’s next pension casualty: the inventor of chocolate sprinkles

In 1923, a young Jewish immigrant from a small town in modern-day Ukraine founded a candy company in Brooklyn, New York that he called “Just Born”.

His name was Samuel Bernstein. And if you enjoy chocolate sprinkles or the hard, chocolate coating around ice cream bars, you can thank Bernstein-- he invented them.

Nearly 100 years later, the company is still a family-owned business, producing some well-known brands like Peeps and Hot Tamales.
[...] Click here to continue reading

And . . . yet another Wells Fargo banking scandal

Is it Friday again? Must be time for another banking scandal!

Seriously-- these banking scandals are happening with such regularity and predictability it would be almost comical. . . were it not for the millions of people who have had their lives turned upside down.

The latest transgression involves, once again, our old friends at Wells Fargo.

Bear in mind that the ink isn’t even dry yet on the $1 billion check[...] Click here to continue reading

More hilarious facts about Tesla from a hedge fund manager who’s short the stock

A few weeks ago, we shared a note about Tesla from the hedge fund Vilas Capital Management. The firm, which is short the shares, said “Tesla is going to crash in the next 3-6 months.”

I received an update from Vilas this morning explaining why they’re even more bearish on Tesla today. The firm pared its short positions after the recent selloff. And Telsa now comprises about 98% of their short book.

Clearly[...] Click here to continue reading

US government says its budget deficit will PERMANENTLY exceed $1 trillion

Yesterday the US government’s own Congressional Budget Office (CBO) published a pretty sobering report about the state of Uncle Sam’s finances-- and what the future holds.

According to the CBO, the federal government’s spending habits are in such dire straits that its total budget deficit will exceed $1 trillion by 2020. That’s just two years away.

The budget deficit, of course, is the amount of money that the government overspends each year.

[...] Click here to continue reading

090: Can’t miss podcast – Recorded live from the 2018 Investor Summit at Sea

I’m writing you today from a cruise ship, on my way to Puerto Rico.

Every year, I get together with some of the smartest guys in finance and investing for my friends, the Real Estate Guys, Investor Summit at Sea.

I almost never speak at conferences outside of Sovereign Man events. But I always make an exception for this one.

It’s rare that you get to spend a week chatting with and[...] Click here to continue reading

And the fastest growing bank asset in 2017 was… SUBPRIME!

They say that goldfish have the shortest memory in the Animal Kingdom… something like 3-seconds.

But it turns out this isn’t actually true.

Researchers at the Israeli Technion Institute of Technology conducted an experiment in 2009 proving that even the tiniest fish could be trained to recall certain sounds after as long as FIVE MONTHS.

According to another study from the University of Chicago, Dolphins ostensibly have the best memories in the[...] Click here to continue reading

Why Elon Musk’s bankruptcy joke on Twitter isn’t funny

Nearly 4,000 years ago in the mid 18th century BC, the King of Babylon passed away, leaving the throne to his 18-year old son Hammurabi.

Hammurabi was smart enough to know that his kingship would be incredibly short if he didn’t do something quickly to assert his power.

So as his first order of business, Hammurabi made a bold proclamation that won him incredible support from his people: he forgave ALL citizens’ debt[...] Click here to continue reading

US government issuing $300 billion in new debt– just this WEEK

I’m doing my best to take a few days off this week, and have the pleasure of spending time with some friends here in a fairly remote corner of Vietnam’s magnificent coastline.

This is one of the most pristine places I’ve ever been-- a high-end resort nestled at the top of a mountain in the middle of nowhere overlooking Vietnam’s postcard-perfect Vinh Hy Bay.

I’ve traveled extensively through Vietnam over the years, from[...] Click here to continue reading

“Tesla, without any doubt, is on the verge of bankruptcy.”

Just a few days ago, shareholders of Tesla approved an almost comical pay package for their cult leader CEO Elon Musk that could potentially put $50 BILLION in his pocket over the next decade.

Let’s put this figure in perspective: at $5 billion per year, Musk would make more than every single CEO in the S&P 500. COMBINED.

In other words, if you add up the salaries of all the CEOs of the[...] Click here to continue reading

Congress quietly formed a committee to bail out 200 pension funds

The US pension system has gotten so bad, Congress is actually planning for its failure.

As the government was working on the recent, new budget deal and subsequent boost in government spending, Congress quietly snuck in a provision that forms a committee which would use federal funds to bail out as many as 200 “multiemployer” pension plans – where employers and labor unions jointly provide retirement benefits to employees.

As is often the[...] Click here to continue reading

Japan is so broke that its prisons are full of 80+ year old ‘felons’

‘Mrs. F.’ was 84 years old the first time she ever went to prison.

Her crime? Petty shoplifting. She stole rice, strawberries, and cold medicine.

She served her time. Got released. Then shoplifted again so that she’d go back to prison.

She’s now 89 years old serving out another 2 ½ year sentence, not too far away from where I am right now, at a women’s prison about 60 miles outside of[...] Click here to continue reading

At $21 TRILLION, the national debt is growing 36% faster than the US economy

Well, it happened again.

On Friday afternoon, the national debt of the United States hit another major milestone, soaring past $21 trillion for the first time ever.

Clearly that is an enormous number… it’s actually larger than the size of the entire US economy, which is pretty incredible.

But what’s always been the more important story about America’s pile of debt is how rapidly it’s growing.

For example, in the span[...] Click here to continue reading

Venezuelan millionaire refugee now working as a personal trainer

It's been a few months since I've traveled to Medellin-- I have a number of investments and business interests in this region, and I like to check in on them from time to time.

Plus, Medellin is a wonderful city. You don't have to twist my arm too hard to visit here.

If I weren't living in Chile (which is also really, really great), Medellin would definitely be on my short list of[...] Click here to continue reading

2,000 years of history says this country should be on your radar

By the late summer of 30 BC, ancient Rome had been embroiled in an almost endless, decades-long period of instability and civil war.

Twenty years prior, back in 50 BC, Julius Caesar and Pompey the Great had waged a long, bloody conflict against each other for control of Rome, one that ultimately ended with Caesar’s victory… and his subsequent assassination.

With Caesar dead, Rome once again plunged into chaos, resulting in more years[...] Click here to continue reading

This is one of history’s most accurate indicators of a looming financial crisis

On April 15, 1185, over eight centuries ago, a powerful earthquake struck the East Midlands region of England near the town of Lincoln.

Modern scientists estimate the magnitude of the earthquake at 5.0 on today’s Richter scale… which was a pretty big deal back then.

Medieval England didn’t have any earthquake-proof construction methods, and much of the region was leveled to the ground.

One of the structures that was destroyed was the[...] Click here to continue reading

Rhode Island Wants to Tax Pornography

The government hasn’t yet figured out how to tax having sex. But Rhode Island at least wants to tax pornography.

Yes I’m serious.

It starts with censorship: two Rhode Island state senators just introduced legislation that would require Internet Service Providers (ISPs) to block all “sexual content and patently offensive material.”

We have no idea, of course, what is considered “offensive”. But in an age of cry-bullies where even the word “man”[...] Click here to continue reading

This may be the dumbest thing that any politician could ever do…

Week before last, I told you about how the brand-new President of South Africa, Cyril Ramaphosa, made an impassioned speech calling for the confiscation of real estate from white land owners.

It was a pretty remarkable thing to say during what was literally his first week in office.

You’d think the new president would take the opportunity to address more immediate, more critical issues-- for example, the fact that Cape Town is about[...] Click here to continue reading

Total student debt in America now exceeds cost of Iraq War

We’ve all seen the headlines: the cost of university education in the United States has become completely debilitating. And student debt keeps rising to record high levels.

It’s almost commonplace now for a 22-year old to graduate from university with $50,000+ in student debt.

According to data from the Federal Reserve, the total amount of student debt in the United States is now $1.5 trillion.

That’s more than the estimated $1.3 trillion[...] Click here to continue reading

Treasury Department reports $1.2 TRILLION loss in 2017

Earlier this month, the United States government released its annual financial report for the year 2017.

This is something the government does every year, similar to how large companies like Apple, or Warren Buffett’s Berkshire Hathaway, publish their own annual reports.

Unlike Berkshire and Apple, though, whose financial reports typically show strong, positive results, the US government’s financial statements are a complete horror show.

Right at the beginning of the report, the[...] Click here to continue reading

South Africa’s brand new president vows to confiscate land from white farmers

If you’ve been following much international news, you’ve probably heard that, after literally years of scandal, abuse, and incompetence, South Africa’s president Jacob Zuma was finally forced to resign last week.

This is a big deal for South Africa.

The country has been suffering for nearly a decade under Zuma’s corruption.

And people are certainly hoping that the new President, Cyril Ramaphosa, will represent a positive, new chapter for South Africa.

[...] Click here to continue reading

Terrified of Bitcoin, banks forced to innovate for the first time in 40+ years

Yesterday morning, several banks in Australia started rolling out a new payment system they’re calling NPP, or “New Payments Platform.”

Until now, sending a domestic funds transfer in Australia from one bank to another could take several days. It was slow and cumbersome.

With NPP, payments are nearly instantaneous.

And rather than funds transfers being restricted to the banks’ normal business hours, payments via NPP can be scheduled and sent 24/7.

[...] Click here to continue reading

This may be the beginning of the Great Financial Reckoning

Less than two weeks ago, the United States Department of Treasury very quietly released its own internal projections for the federal government’s budget deficits over the next several years.

And the numbers are pretty gruesome.

In order to plug the gaps from its soaring deficits, the Treasury Department expects to borrow nearly $1 trillion this fiscal year.

Then nearly $1.1 trillion next fiscal year.

And up to $1.3 trillion the year[...] Click here to continue reading

Meet the world’s next central banker: Mark Zuckerberg

Within the last week, Facebook announced a ban on all advertisements about bitcoin, initial coin offerings and other cryptocurrencies.

Facebook (along with Google) virtually controls Internet advertising. So their policies have enormous influence over consumer behavior.

Banning ICO advertisements on its platform, for example, will certainly have a negative impact on the amount of money flowing into new ICO’s.

Facebook said it instituted this ban to “protect its users” from financial scams[...] Click here to continue reading

This tiny corner of Rhode Island shows us the future of Social Security

The United States Court of Appeals for the First Circuit gave us an interesting glimpse of the future last week when it ruled on an obscure case involving government pension obligations.

Ever since the mid-1990s, police officers and fire fighters in the town of Cranston, Rhode Island had been promised state pension benefits upon retirement.

But, facing critical budget shortfalls over the last several years that the Rhode Island government called “fiscal peril,”[...] Click here to continue reading

Why Albert Einstein thought we were all insane

In the early summer of 1914, Albert Einstein was about to start a prestigious new job as Director of the Kaiser Wilhelm Institute for Physics.

The position was a big deal for the 35-year old Einstein-- confirmation that he was one of the leading scientific minds in the world. And he was excited about what he would be able to achieve there.

But within weeks of Einstein’s arrival, the German government canceled plans[...] Click here to continue reading

This is the most important meeting I attend every year

[Editor’s Note: Today's Notes, originally published one year ago, is about one of the most impactful things I do each year. If you know a young entrepreneur who may be interested in what we're doing, please forward this piece along. It could change their lives…]

I’ve always been a big believer in entrepreneurship.

But not in the sense that most people think of that word.

My dictionary defines “entrepreneur” as “a person[...] Click here to continue reading

“We choose debt. . .”

I’ve long held a working theory that US voters are completely predictable in Presidential elections.

The idea is that Americans almost invariably tend to swing wildly every few election cycles, voting for the candidate who is as close to the opposite of the current guy as possible.

Let’s go back a few decades to, say, Jimmy Carter.

In 1976, the country was sick and tired of the corruption, scandal, and disgrace of[...] Click here to continue reading

GE just signaled the next crisis and nobody’s paying attention

Earlier this month, General Electric took a $6.2 billion charge to its insurance unit for the fourth quarter. And the company said it will set aside another $15 billion over seven years to bolster reserves at GE Capital.

The charge had to do with long-term care policies (to pay for nursing homes and other late-life care) GE holds on its books.

So, one of the oldest and most highly-regarded companies in America just[...] Click here to continue reading

Message from Planet Japan: The good times never last forever

After having traveled to more than 120 countries in my life, the only person I know who’s been to more places than I have is Jim Rogers.

Jim is a legend-- a phenomenal investor, author, and all-around great guy.

(His book Adventure Capitalist is a must-read, chronicling his multi-year driving voyage across the world.)

Some time ago while we were having drinks, Jim remarked that he occasionally tells people, “If you can[...] Click here to continue reading

The time when Kiefer Sutherland beat me to the punch

Back in 2013 I had an idea for a movie.

The basic premise was that some unknown domestic terrorist group executes an attack on the United States government by blowing up the Capitol during the President’s State of the Union Address.

It’s a little silly, but I even wrote a small treatment for it, including this scene--
ATTACKER speeds off to a parking garage where he ditches the bike, takes off his black[...] Click here to continue reading

Social Security proposes “immediate and permanent reduction” in benefits

On a deep, dark evening last June in the spectacularly celestial deserts of northern Chile, scientists made a phenomenal discovery.

It was a supernova… one that they named ASASSN-15lh.

This wasn’t just any supernova. It was the BIGGEST and BRIGHTEST supernova ever recorded.

Supernovas are exploding stars whose ejected mass and energy can create a light show so brilliant that they can sometimes be seen with the naked eye in our own[...] Click here to continue reading