Wealth Formula by Buck Joffrey

We haven’t talked about cryptocurrency much lately. Admittedly, I am like everyone else who gets excited when the markets are going sky-high but quickly loses interest when markets are struggling. However, In times like these, regardless of asset class, it is critically important to stay rational. Let’s take bitcoin as an example. As I write this Bitcoin is sitting just under $20K. It could absolutely go lower. But…for those of us who believe bitcoin is here to stay, does it matter? If you believe bitcoin is here to stay and that there is a finite amount of bitcoin that will ever be in existence, the price simply must go up over time as more people buy it and the market capitalization increases. This is an extraordinarily volatile market. But if you look at bitcoin price history, the trend is clearly UP. If that’s the case, and you are a long-term holder/believer of bitcoin, you should be rejoicing about bitcoin prices today and strongly consider buying. This is a very difficult thing to do because ultimately we are wired to run away from danger (falling prices) and to run to pleasure (euphoric markets). But you have to rise above those instinctual impulses and be rational. That’s how the best investors in the world, like Warren Buffet, differentiate themselves from the masses. Ok…so enough pep talk. Let’s be practical. We are in a bear market. Many of us have lost significant value to our portfolios. The good news is that the tax rules for cryptocurrency are favorable—especially when it comes to locking in losses. As we wait for the bear market to end, it is a good time to make sure that we are aware of accounting principles and tax law as it relates to cryptocurrency. This will make it much easier when your portfolio explodes again! For that purpose, this week’s Wealth Formula Podcast Features a CPA who specializes in cryptocurrency. Listen NOW! Micah Fraim is a CPA living in Roanoke, VA. His expertise has been featured by Forbes, TIME, MSN, Nasdaq, Fox Business, Yahoo! Finance, and other major publications. Micah is a business expert in addition to a tax guru. This allows him to bring a unique perspective to his clients – advising them on what is best for their business overall, not just from a tax perspective.

It’s time for another round of “Ask Buck”. This week’s episode includes questions on taxes, multifamily real estate investments and the Wealth Accelerator. Listen HERE!

It’s been a while but this week’s episode of Wealth Formula Podcast is the latest “Ask Buck” episode. As you know, most of the time I interview other people so I don’t get a chance to talk to you directly. These episodes are great for learning. In fact, go back and listen to the last 10 “Ask Buck” shows and you will know as much as I do about personal finance! This week we will be talking a lot about taxes and the real estate market. Make sure to tune in!

Investing is hard enough without worrying about all the crooked stuff going on out there. When you add that to the picture, it’s a miracle that most of us have actually made money investing. And if you think the nefarious activity is limited to the private space, you would be mistaken. Big money can manipulate public markets just as easily. Take Enron for example. The global financial collapse of 2008 exposed a lot of white-collar criminals. When the lending markets dried up it was like the tide went out and exposed all that were swimming naked. Of course, we had a front seat to the financial collapse in the United States beginning with the downfall of Lehman Brothers. But credit dried up globally and created chaos throughout the world. One of the most interesting stories is that of Iceland. My guest on today’s Wealth Formula Podcast was one of the leading investigators into the Icelandic financial meltdown which was pound for pound the biggest financial meltdown in global history. Jared Bibler wrote a book on the topic with critics describing it as “Insatiable greed, flamboyant crimes, scheming politicians, dish-pan clanging housewives!” What else could you ask for? Tune in for a very entertaining conversation with Jared Bibler. Jared Bibler is a graduate of MIT, where he studied engineering. He is also a CFA charterholder with nearly 20 years of broad experience in the global financial markets. Jared started his career in Boston and New York, where he worked as a consultant to a Wall Street giant. Following that, he moved to Iceland where he supported the Icelandic pension funds’ foreign investments. Unhappy with this environment, he resigned from his job at a leading Icelandic bank days before the 2008 Icelandic financial crisis. He was subsequently hired to head a special investigation team at the Icelandic markets regulator. Jared and his team referred more than 30 criminal cases to the Special Prosecutor of Iceland, including the largest stock market manipulation cases to be prosecuted globally. Shownotes: The financial meltdown in Iceland and the US What happened during the biggest financial collapse in history? What triggered the financial meltdown in Iceland? Jared’s book Iceland’s Secret: The Untold Story of the World’s Biggest Con

This week’s episode of Wealth Formula Podcast is about emotional intelligence. Why would we talk about such things on a personal finance show? Well, let’s define emotional intelligence for a moment. We all have emotions. If you want to see emotions in their rawest form, look at a toddler. One minute you might have an angel and the next you might have a complete meltdown and a demon from hell. Adults are no different. Emotional intelligence is the ability to step away from those emotions and examine why you are having them. Toddlers don’t do that and only some adults really do. Why is emotional intelligence useful to have? Well, emotions can get us into trouble unchecked. We’ve all sent the text or email that we wish we hadn’t in the moment. We all have those moments that we wish we had kept our mouths shut. As Warren Buffet says, “ You can always tell someone to go to hell tomorrow.” Buffet also says, “Be fearful when others are greedy, and greedy when others are fearful.” Everyone knows that you should buy low and sell high, right? But when shit hits the fan, few are able to overcome emotions and do what they rationally know they should do. This week on Wealth Formula Podcast I talk to an expert in emotional intelligence who says that emotional intelligence can not only be measured, but also developed to optimize multiple facets in our lives. Maybe it can make you a better investor? Listen HERE Carolyn Stern is the President and CEO of EI Experience — an executive leadership development and emotional intelligence training firm. She is a certified Emotional Intelligence and Leadership Development Expert, professional speaker, and university professor. Carolyn’s emotional intelligence courses and modules have been adopted by top universities in North America. She has also provided comprehensive training programs to business leaders across the continent in highly regarded corporations encompassing industries such as technology, finance, manufacturing, advertising, education, healthcare, government, and foodservice. Her engaging, results-based approach has been synthesized here for the first time in a user-focused, self-coaching model that will motivate and inspire readers to apply the power of emotional intelligence to their own leadership and organizations. Carolyn lives and works in Vancouver, British Columbia. Shownotes: What is Emotional Intelligence? Is there a way to measure emotional intelligence? Building Emotional Intelligence? Emotional Intelligence and Financial Success Carolyn’s book The Emotionally Strong Leader

You’ve probably noticed that my emails have been pretty short the last few weeks. I’ve been in Europe so I’m letting the podcast speak for themselves for the most part. This week we go back to fundamentals. There’s a reason why real estate is the foundation of the Wealth Formula personal finance ethos. There is simply nothing comparable in terms of risk adjusted returns and tax benefits. To reinforce these concepts, this week‘s podcast features a conversation with a CPA specializing in real estate. This is a must listen podcast. Enjoy! Brandon was named 40 under 40 by CPA Practice Advisor in 2018. Brandon leverages his personal real estate investing and his Big 4 Accounting experience to offer unique insights to his clients. Brandon enjoys CrossFit and Kiteboarding when he’s not crunching numbers. Shownotes: What are the major primary tax benefits of investing in real estate? What are the rules to qualify for Real Estate Professional status? Tax Smart Real Estate Investors Podcast

When I think about all of what has happened to our economy over the past two decades, it’s quite astounding. National debt has gone up by about 5x. Interest rates hovered at nearly zero for multiple years and we went through multiple shocks to the system like the 2008 meltdown and Covid. Again—all in the last two decades! This week’s guest on Wealth Formula Podcast has seen a lot more than I have as he served in the Reagan administration at a time when Paul Volker used significant interest rate increases to bring down hyperinflation and he was deeply involved in the response to the Savings and Loans Crisis of the 1980s as well. Thomas Vartanian saw it all happen from the front row. His recent book, 200 Years of American Financial Panics: Crashes, Recessions, Depressions, and the Technology that Will Change it All captures the major themes of American Economic History. Tune into this week’s show as we find out what he thinks about the economy today and what lessons from the past we can apply to try to get ourselves out of the mess! Thomas P. Vartanian is a former regulator, legal adviser, academic and author who has worked in the financial services industry over six decades. He is currently the Executive Director of the Financial Technology & Cybersecurity Center. He previously was the Executive Director of the Program on Financial Regulation & Technology at George Mason University’s Scalia Law School, and before that, he chaired the Financial Institution’s practices at two international law firms, Dechert LLP and Fried Frank LLP, through four financial crises. Both as a regulator and private practitioner, he has advised parties in 30 of the 50 largest financial institution failures in American history, developing a deep understanding of the causes of financial collapses. He has been described by clients in Chambers as “one of the best financial services lawyers in America.” Mr. Vartanian served in the Reagan Administration as General Counsel of the Federal Home Loan Bank Board and the FSLIC, where he authorized the receivership, sale, or liquidation of hundreds of failed institutions in the S&L crisis, including the first national and cross-industry financial institution combinations in the country. Prior to that, he served in the Carter Administration in the Office of the Comptroller of the Currency as Special Assistant to the Chief Counsel. Mr. Vartanian is a futurist and expert in financial technology. He was Chairman of the American Bar Association’s Cyberspace Law Committee between 1998 and 2002, where he chaired an international task force of lawyers from twenty countries which issued a seminal report on the novel issues created at that time by doing business over the Internet. Since leaving government service in 1983, Mr. Vartanian has been approached by the Reagan, Bush, Obama, and Trump Administrations to head federal financial regulatory agencies, including being interviewed to become the first Vice Chair for Supervision of the Board of Governors of the Federal Reserve System. Rather than return to government service, since the 1980s, he has represented a variety of government entities, financial companies, and their investors, as well as informally advised several Presidential Administrations. Mr. Vartanian has authored more than four hundred articles and eight books. He is a frequent lecturer and media commentator on the financial services industry, having appeared on Bloomberg TV, CNN, Fox News, PBS and a variety of radio shows. He has taught banking and electronic commerce law at Georgetown Law School, George Washington Law School, and Boston University School of Law, and has been a guest lecturer at Harvard Law School. In 2008, Mr. Vartanian was named “Washingtonian of the Year” based on his use of music and sports to raise money for charities in the D.C. metropolitan area. As a musician, he appeared in the first production in the United States in 1970 of Joseph and the Amazing Technicolor Dreamcoat. His classic rock band, The Johnny Esquire Band, has helped raise approximately $5,000,000 for charities in the Washington D.C. area over the last twenty years. Mr. Vartanian founded and plays on the Washington All Stars, a senior baseball team that has raised $500,000 for Special Olympics since 1998. Shownotes: What kinds of similarities are there in our current economic environment that contribute to the higher inflation? How has Covid changed the economic functioning of the United States? Can we just print as much money as we want? 200 Years of American Financial Panics: Crashes, Recessions, Depressions, and the Technology that Will Change it All

There is a fine line between being a “quitter“ and a pragmatic individual navigating life. Quitting has a very negative connotation in our culture. It’s un-American and is associated with weakness and lack of grit. In reality however, quitting is often the best thing you can do and the sooner that you do it the better off you are. I’m a good example of a guy who has quit quite a few times and is much better off for it. For example, when I was in medical school, I was a hardcore student. They used to call people like me gunners. I was intense about my studies and got myself involved with lots of research projects and became the favorite student of the neurosurgery department. You see, at some point along the line I decided that I wanted to be a brain surgeon. I thought that the brain and the central nervous system were fascinating. In hindsight, however, I must admit that there were stronger drivers involved. I saw brain surgery as the top of the medical pecking order. Of course the idea of being a brain surgeon also appealed to me because of the social bragging rights that came along with it. After all, most people outside of medicine are pretty impressed when you tell them that you’re a brain surgeon. So, I did what I had to do to get into a neurosurgical residency. I graduated with honors for medical school and scored very high on the required board exam used to evaluate residents. I also published multiple book chapters and peer reviewed articles in neurosurgery before I finished medical school. Because of that drive, I got into one of the top neurosurgery programs in the country that produced some of the most famous people in the profession. My grand scheme was working out beautifully.  Then it happened. I started the program and, to my surprise, I wasn’t really enjoying myself. Sure, I liked walking around with a white coat that said neurosurgery on it and tried to use it to impress cute nurses. I did feel pretty macho I must say. But it was not enough to get over the fact that I hated the hours. Very early mornings and very late nights were the norm on non-call days. When on call, any emergency meant I was up all night operating. Bleeding brains can’t wait until the next morning. Then, I would have a full day of surgery the next day that I had to be alert and attentive for and try to learn something along the way. Boy…I really hated that. Curiously, I noticed that most of my fellow residents seem to get excited when the pager went off in the middle of the night. They got excited and filled with adrenaline when called to action—like Batman. Not me. When the pager went off in the middle of the night I would feel nothing but dread. It took me midway through my second year of neurosurgical residency to figure out that this was not going to work out. So I quit. At that point, I felt like I was in free fall. For years I had created this identity that I was living. It took thousands of hours to get there with lots of blood and sweat. Was it just a waste of time? Well, It probably was a waste of time but it could have been worse. I could have stuck it out for another five years and been miserable the rest of the way. My attending professors didn’t seem to have such a great life either so it wasn’t like there was light at the end of the tunnel. I ended up switching specialties and ended up in cosmetics (brains vs butts…what’s the difference?) And of course after a few years of that, quit medicine altogether. I guess it just wasn’t for me. Think of that for a moment. Four years of college, four years of medical school and seven years of postgraduate surgical training. And I just quit because I didn’t want to do it anymore. Liberating. The moral of the story is that when you figure out that something is not working for you, move on quickly. It seems simple enough right? But how many people do you know who complain about their jobs every single day and talk about doing different things but never do? Relationships are no different. You usually know within the first few weeks if there is long-term potential. However, rather than break it off quickly, people often drag out relationships for months or years trying to make it work and sometimes even get married! Well, as a divorced guy, I’m not much of an authority on relationships. However, The larger theme here is quit while you are behind. Don’t prolong the pain. There is plenty of gain to be had without enduring pain. My guest on this week‘s Wealth Formula Podcast is Steve Magness. He’s written a book that tries to explain why being tough and resilient is not always the right thing to do for an individual. So, If you feel like a lab rat on a treadmill you’ll definitely want to tune in to the show! Steve Magness is a world-renowned expert on performance. He is the author of the new book Do Hard Things: Why We Get Resilience Wrong and The Surprising Science of Real Toughness. He is the coauthor of Peak Performance. The Passion Paradox, and the author of The Science of Running. Collectively his books have sold more than a quarter-million copies in print, ebook, and audio formats. Magness has served as an executive coach to individuals in a variety of sectors. His work serves on applying the principles of which he writes. In addition he’s served as consultant on mental skills development for professional sports teams, including some of the top teams in the NBA. His writing has appeared in Outside, Runner’s World, Forbes, Sports Illustrated, Men’s Health, and a variety of other outlets. In addition, Steve’s expertise on elite sport and performance has been featured in The New Yorker, Wall Street Journal, The New York Times, The Guardian, Business Insider, and ESPN The Magazine. Steve received his undergraduate degree from the University of Houston and a graduate degree from George Mason University. He currently lives in Houston, Tx with his wife Hillary. Once upon a time, he ran a mile in 4:01 in high school, at the time the 6th fastest high school mile in US history. Shownotes: What is toughness? Toughness vs. resilience Steve’s book: Do Hard Things Why would anyone want to do something that seems daunting and hard?

One of the consequences of inflation is increasing wealth disparity. Think about it for a moment. CPI indices only measure a basket of goods and services. But you and I know as investors that inflation helps us out with our investment portfolios as well. Asset inflation is a real thing. If you don’t have the money to invest, you only get the downside of inflation. Prices for everyday stuff go up and it becomes harder and harder to get by. How bad can it get? Well we already have food insecurity in our own country…the richest most powerful country in the world. And there are pressures on food supplies globally now with draughts and the war in Ukraine, also known as the breadbasket of Europe. So are we heading to a worldwide food shortage? And if we are, what are the consequences to those at the top of the food chain? Maybe we don’t go hungry but hunger is a big driver of social unrest globally. The world is already a highly volatile place. My guest on Wealth Formula Podcast this week studies the food supply and sheds light on the true extent of the problem. Make sure to tune in! Marc Bellemare is a Distinguished McKnight University Professor, Distinguished University Teaching Professor, and Northrop Professor in the Department of Applied Economics at the University of Minnesota, where he also directs the Center for International Food and Agricultural Policy. He currently serves as one of four co-editors of the American Journal of Agricultural Economics. Prior to that, he served as one of two co-editors of Food Policy from 2015 to 2019. His research focuses on agricultural economics and applied econometrics. A few specific areas in which he has been conducting research include agricultural value chains, risk and uncertainty, and the consequences of high and volatile food prices. For his research, he has won the Agricultural and Applied Economics Association’s (AAEA) Outstanding Doctoral Dissertation Award in 2007, the AAEA’s Outstanding American Journal of Agricultural Economics Article award in 2011, and the AAEA’s Quality of Research Discovery awards in 2014. That same year, he also won the European Association of Agricultural Economists‘ Quality of Research Discovery Award. His work so far been featured in media outlets such as The Economist, the New York Times, National Public Radio, and the Wall Street Journal. For his teaching, Marc won the College of Food, Agricultural and Natural Resource Sciences Distinguished Teaching Award for Graduate Faculty in 2018. In 2022, he won the University of Minnesota’s Award for Outstanding Contribution to Graduate and Professional Education, and was inducted in the University of Minnesota’s Academy of Distinguished Teachers. From 2018 to 2021, Marc served on the Board of Directors of the AAEA. Shownotes: What drives a food crisis? Is there a food crisis right now? The Food Crisis and its effects on Americans from different socio-economic backgrounds Potential social unrest as a result of the food crisis

When was the happiest time of your life? I mean like inner-happy type happy? For me, it was definitely as a kid. My childhood was by no means all roses, but the little things in life brought me a ton of joy. I remember riding my bike to friends’ houses and knocking on their doors (that’s what we did in the 80s), getting together a group of friends for an impromptu baseball game or just riding around on our bikes and going places we shouldn’t have gone. School was fun during elementary school. It felt like a camp. You got to go see your friends everyday, play at recess and learn some cool stuff. No pressure…just a pure routine. I had my intellectual curiosities as well. When I wasn’t at school I would be closely studying the sports pages of the newspaper. I was a virtual encyclopedia on both the NHL and the NFL. It was pure joy for me to scour the library for books on famous athletes. By the time high school rolled around, a lot of the joy of academics was gone for me. I was good at school but definitely preferred to party and to play sports. And of course I discovered girls which brought a new level of interest for me to be at school. While I kept a steady state of party going in college, my academic work now became a job. When I decided to go to medical school, I realized I couldn’t afford to take art and acting classes for fear of them bringing my grade point average down. I had to stick to advanced biochemistry and molecular biology! I wasn’t doing any sports anymore and I had no real intellectual pursuits outside of my job as a premed student (and organic chemistry tutor). Medical school was really interesting but the specialization left little time for anything else in my life. As I track these different times in my life I can see the inner joy levels dropping precipitously at each step. Why? Well, my drops in inner happiness seem to be correlated to the times in my life when I transitioned from enjoying the present time as a kid to focussing primarily on the future as I progressed to college and medical school. I spent so much of my life sacrificing the present for things in the future. I gave up most of my 20s to medical school and surgical residency. Then I set my mind to create successful businesses and investments so that I could make all the money that I wanted to make. But now I’m kind of here. Sure I’m always happy to become richer but I have already surpassed anything I thought I would make. So now what? Of course I continue doing what got me here but I recently realized that something was really missing in my life.  Thinking back to what made me happy as a kid, I decided to see if I could reverse engineer myself back into having a child’s mindset. Here’s some major things that made me happy as a kid: Playing sports. I was a good athlete. I even have one of those elite power athlete genes! Being part of a community. I didn’t realize how hard it is to make close friends once you leave a school situation. Learning new stuff. For me, this is critical. I need intellectual stimulation. If I am not learning I feel like I am dying. Focusing on gratification today. Yes I mean gratification. We spend so much of our time planning for the future that we forget to have fun today. So yes…spend some of that money because you can’t take it with you. So here’s my plan. I’m going to get active in local sports leagues. I’m going to start volunteering in the community. I am going to read a book about something random every week. And I’m going to buy some fancy shit and not feel guilty. I’m not kidding. I’ll tell you how it goes! All of this stuff I’m talking about has been on my mind for a while. Then I heard about the work of Frank Keil, a researcher at Yale who has been studying the concept of Wonder in childhood and was intrigued by how these ideas could be applied to my own journey. Dr. Keil’s research on children and wonder is fascinating and might provide you some ideas on how to bring some youthful vigor back into your own life. Listen HERE for this week’s episode of Wealth Formula Podcast. Professor Frank C. Keil (Ph.D., University of Pennsylvania, 1977) is the director of the Cognition and Development lab. At the most general level he is interested in how we come to make sense of the world around us. Much of this research involves asking how intuitive explanations and understandings emerge in development and how they are related to notions of cause, mechanism and agency. These relations are linked to broader questions of what concepts are, how they change with development and increasing expertise and how they are structured in adults. One set of current studies is examining a level of explanatory insight that functions without knowledge of specific mechanisms and instead involves knowing what sorts of properties are causally potent in a domain and how they are likely to interact. These patterns vary considerably across large scale domains of phenomena such as living kinds vs. artifacts) and a partial understanding of these patterns emerges very early in development and guides learning of more detailed domain specific beliefs. Other studies are examining constraints on preferences for some explanations over others even when there is little or no specific knowledge of the phenomena under explanation. He is also asking how emerging knowledge of concrete mechanisms can link up frequency based information with abstract explanatory principles as well as cause distortions in judgment. A key part of developing such understandings also involves learning how knowledge is clustered and distributed in the minds of others and how best to access that knowledge. He is exploring dramatic developmental and individual differences in how the social distribution of knowledge is understood. Finally, there is a longstanding interest in links between conceptual and semantic development and how the emergence of language interacts with conceptual structure.