Podcast

TWS 59 | The Wealth Gap

The Wealth Gap: Identifying Inequalities With Connor Boyack

September 10, 2020 Patrick Donohoe Podcast 00:25:24 Comments Off on The Wealth Gap: Identifying Inequalities With Connor Boyack

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TWS 59 | The Wealth Gap

 

One of the most controversial topics today is the existing and widening wealth gap between the rich and the poor. Tackling this important conversation to offer a unique and even quite controversial view, Patrick Donohoe is joined by Connor Boyack, founder and president of Libertas Institute—a free-market think tank in Utah. Here, Connor gets into the significant wealth that has spun great talks about inequality from both sides of the political aisle to create divisiveness. He goes deep into capitalism, the billionaires that keep getting rich, and moving up the economic ladder. Follow along to this insightful episode to learn more about this issue we’re facing now in our society.

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The Wealth Gap: Identifying Inequalities With Connor Boyack

Thank you for tuning in to the show. Connor Boyack is an incredible man. He’s been on the show before. We’re talking about a controversial topic. We’re breaking it into two parts. The first part is going to get into the wealth gap that is significant. Wealth inequality is a theme that’s being used by both sides of the political aisle to create divisiveness. Right now, there are a lot of upset people. This episode, without the proper context, may upset you, so go back and read the last 4 to 5 episodes.

Hopefully, that will prepare you to think rationally about this sensitive topic. The drive we have to make a difference grow and be free is evident across most human behavior. Achieving that result is what I characterize and what I’ve tried to talk to you about as true wealth. The show’s mission is to help you identify sound principles that will guide you to achieve wealth and prosperity regardless of the environment or economic circumstances. Right now, it may not seem possible but understanding the principles will allow you to understand that it’s not the environment that creates that end, it’s principles, and acting on those principles.

Through this lens, these emotionally sensitive topics will inspire you instead of infuriate you which is, unfortunately, the way in which people are looking at this topic. My compadre, Connor Boyack, has dedicated his professional life and arguably because of some threatening experiences that he’s had his whole life to defending the principles of prosperity by being involved in the political arena here in Utah. Also, by expanding that into the world of literature and education with over 21 books, most of them through the children’s book platform.

For those of you who have listened to Connor before The Tuttle Twins books, I get comments about that more than anything else that’s coming from the show. Connor is going to give you a code to get these books. I’m offering something for the rest of 2020. For those of you who purchase the package and Connor is going to give an insane discount for all of the books or the online curriculum that he has, I’m going to match that. What I mean by that is if you purchase, I’m going to pay for another either package of books or the online course that you can give to somebody else. I’m going to do that through the end of 2020.

I hope you gain a lot from this. I hope you’re able to step back and think through some of the points that we make and that it enlightens you to understand the narrative but also understand how to have a productive, and meaningful conversation with somebody else about this topic. I hope it inspires you to understand how the world has improved because of the environment that we have in which people can start businesses. They can be free to fail, free to succeed, and how that improves everybody’s life. Let’s cut to the interview. Without further ado, this is Connor Boyack.

Wealth is not the natural condition in life. Poverty is the natural condition in life. Share on X

He is the President of Libertas Institute, which is a nonprofit think tank here in Utah, but it’s also an educational organization. They promote through a lot of influence up on Capitol Hill during legislative sessions. They promote the principles of liberty but they also educate the public in many different ways. Connor is also the author of 21 books. It also includes a children’s series, which is incredible. It’s called The Tuttle Twins. Connor, welcome to the show. You’re no stranger here except for those that are new and new readers. Thanks for coming back. I appreciate your time.

I’m happy to be here. I’m excited to get into the issues with you.

This is a hot one because it’s something that’s been politicized. It’s being weaponized by different political parties. It’s the wealth gap. I’m going to read some statistics which I haven’t given you in advance I’m sure you won’t be surprised. This is given the federal reserve’s stats, whether they’re objective or not. I would say it’s close to as objective as possible. In the United States is $104 trillion of private wealth in terms of money. The top 1%, $32 trillion, the next 9%, $39.1 trillion, the next 40%, $31 trillion and the bottom 50%, $1.5 trillion. There’s a gap and the gap is shown to widen. Connor, I think we are able to have a conversation that understands both perspectives. When you hear these numbers, when you hear the narrative that’s used and how it’s weaponized and politicized, what goes through your mind? How do you process that?

I’m excited by those numbers, where other people find them repugnant and see an inequality that needs to be addressed. I’m conversely excited and that’s for an important reason. What would those numbers have been like a century ago? What would those numbers have been like three centuries ago? The fact that much wealth has been created has made it so that we all live like kings. Even that bottom 50%, the bottom 10%, even the bottom 2% live like kings compared to people a century ago.

The creature comforts that we enjoy that this wealth inequality has allowed wealthy people to amass capital, to invest in research and development, and come up with new innovative conveniences. The fact that Jeff Bezos is now going to be delivering our products by drone on the same day we order them. Packing the mule over the mountain with a couple of workers that take up a three-week journey to get to you and by then, half of what you ordered has been stolen or moldy. The fact that some people have gotten rich should not distract us from the fact that everyone has gotten rich.

Wealth is not a natural condition in life. Poverty is the natural condition in life. The fact that some people have become wealthier than others doesn’t discount the fact that basically everyone has become wealthier. Everyone has a higher standard of living and it’s this system for all of its warts and bumps and everything else. It’s not perfect. It’s this system compared to any other that has allowed for that massive creation of wealth and prosperity across all the demographics that you can imagine.

TWS 59 | The Wealth Gap

The Wealth Gap: The comforts we enjoy from this wealth inequality have allowed wealthy people to amass capital to invest in research and development and develop new, innovative conveniences.

 

I could have guessed that you were going to say something along those lines, even though we haven’t even talked about this in detail previous to the interview. I have some statistics here that I usually will find from an opinion and perspective research, depending on the perspective. It doesn’t make the news headlines that often but one of them is Matt Ridley. He’s written a bunch of books. The one that hit me the hardest years ago was The Rational Optimist, which is when everything was falling down and he wrote this book that said that the world is amazing.

Here are some of the things that he cited in a blog post. He said, “Extreme poverty has fallen below 10% of the world’s population for the first time.” It was 60% when he was born, which was in the late 1940s. Child mortality has fallen to record low levels. Famine virtually went extinct. Malaria, Polio and heart disease are on the decline. One of the least fashionable predictions that he made was the ecological footprint. We have been able to use more sustainable resources and be more efficient with the way in which we are attentive to those initiatives.

As far as the use of land and the use of water when it comes to producing food has dropped 100%. I can keep going on and on as far as how people are coming out of extreme poverty. Peter Diamandis is more on the technological front. He’s talked about the fact that we’re approaching four billion people with smartphones. Where people are getting connected, they’re getting access to information, education, and so forth. I agree with you. There’s a disease of abundance than there is of scarcity when it comes to living the way that we live now versus what life would have been 100 years ago.

I was going to add to your list before with the proliferation of mobile phones and so forth, access to banking or cryptocurrency, sending money around, transmitting to family members and other countries. The fact that Africa didn’t get into landlines and telephone poles and all the rest. They leapfrogged over that and now have like 95% plus penetration of cell phones, even out in these remote villages where they can access Wikipedia and suddenly any villager can learn from all of the knowledge in the world.

I was a missionary in Honduras many years ago and I lived in these tiny little pueblos for two years. I remember once a week, we would get an opportunity to email the family and say, “I’m still alive out here.” We do that at these internet cafes that were crazy expensive. They were rare. The internet was horrible. Now, the same thing as you pointed out. Everyone’s got cell phones, constant connectivity, connecting all the world, creating amazing remote work opportunities where people out in these villages can go on Upwork.com and say, “I can do graphic design. I can do editing. I can do translation and I can do whatever.” It creates all these economic opportunities that they didn’t have before.

I care a lot about issues surrounding charity and poverty. I don’t want to sound like I’m some kind of greedy capitalist. My wife and I focus and try to lift those who are in need and find ways to serve. I know of no other economic system that does it better than what’s often called capitalism because you have the incentive for these people to go and produce. That means the Jeff Bezos and the Elon Musk and others are going to amass substantial wealth but they’re not extracting it from anyone. It’s not a zero-sum game. They’re not forcibly taking it from people. All that means is they figured out a way to serve a crap ton of people because capitalism and entrepreneurship and business is service. It’s, “I hate pulling weeds and the fact that someone will come to serve me by pulling my weeds and we have an economic exchange, I can make it worth their while.”

There's more of a disease of abundance than there is of scarcity when it comes to living the way that we do today. Share on X

That is still service to me because I would rather part with $10, $20, $50 or whatever than do the weeds. Having an electric car, having drone deliveries, or whatever the issue is. These people have figured out a way to serve a ton of people rather than a few people. In my mind, that is a system that should be praised, notwithstanding that. I do think it’s important that we still look at the inequality issues and figure out even better ways to help people move up that economic ladder. It doesn’t come from the traditional. Do you remember the lobsters and the bucket story? Where you put lobsters in a bucket and as one tries to get out, the other crabs pull down, “Let’s try and pull it down so we can get up.”

That’s not how the system works. We can figure out a way to build up more people. We don’t have to tear down the 1% and take more of their money and remove their incentives to serve even more people. We can do it in a way that empowers even more people and removes those roadblocks of regulations. Even people who want to start a food truck, they’ve got to deal with a nightmare of regulations to get their foot in the door and entrepreneurship to maybe do a food truck to then do three, to then do a brick and mortar restaurant and grow an empire of franchise.

If we have these regulations and other problems in the way that prevent the people on the bottom, if you’ve got money, you can make problems go away. You can be strategic and figure out a way around them. It’s the people on the bottom who don’t have those resources. They can’t navigate the system. They’re often trapped by the system that purports to help them and puts them on the dole and says, “Here’s some money. Go sit on a couch, watch Netflix and chill while we subsidize your inactivity.” What if instead, we remove those roadblocks that don’t have the capital and the network to circumvent on their own so that they can bootstrap themselves up and be able to go to work? There’re many stories of rags to riches that you can’t say that everyone who’s wealthy gets wealthier and everyone who’s poor stays poor. That’s not reality at all but I do think there are improvements we can make to help more of those rags become riches and give even more people that opportunity.

Now, let’s cross lines because just as much as we ourselves have rationalized this, not together but in probably similar ways, the overwhelming majority does not believe this way. Let’s look at their perspective. How do you sympathize with them? How do you understand why they’ve come to a conclusion they have which could be the diametric opposite of ours? How is that being politicized?

You may have seen the video of a Black Lives Matter leader protesting outside of the courthouse saying to the camera, and to the public that it is okay that we go loot these businesses, that we do these riots, that we bash in the store windows, that we take all these apparel, toys, electronics and everything we’re taking because they have insurance. There have been other Black Lives Matter protesters who I watched a video of one woman defending the pillaging of white store owners as a form of reparations because, in her words, it was the black community that has built that business and never been able to take advantage of the profits.

The downside there is, first of all, that’s not how insurance works or why it exists. I think the first comment reflects an economic misunderstanding. She’s trying to justify theft. The second comment was more interesting to me. This notion of reparations and this long-standing injustice that certain people have been kept down. They’ve been denied these opportunities and to that, I say I don’t disagree. There have been a lot of these problems. Zoning laws were instituted because of racism. It was a way to segregate neighborhoods and keep black people out of white neighborhoods. You still have those problems to this day. Zoning boards and city councils and others will perhaps not overtly or explicitly but they can hide their bias and use zoning laws to keep certain people down and prevent them from having commercial activity in their neighborhoods or from integrating into other parts of the city or whatever.

TWS 59 | The Wealth Gap

The Wealth Gap: The fact that some people have become wealthier than others doesn’t discount the fact that basically everyone has to become wealthier.

 

It’s because it was illegal. They could have been fined. They could have been put in jail if they crossed those lines.

There are certainly these policies that have been in place over time that have been put in place but the tough thing I have with reparations is that you don’t have an opportunity to connect one-to-one. By that, I mean that maybe someone did something horrible 80 years ago or 20 years ago, or 150 years ago but how does that justify perpetuating the injustice by forcing someone else whose fault it is not to pay for the misdeeds of what someone else does? I sympathize. I want to help. I want to remove those roadblocks. I want to help everyone be able to flourish and have that opportunity. I just struggle with what some of the demands are where people look at that inequality, and they have this kind of aggregate perception that there’s this systemic problem. Therefore, we’re going to have a systemic solution, an aggregate solution that uses the sledgehammer and says, “We’re going to do this so that we benefit.”

In a way, that’s continuing the injustice that they’re talking about by perpetrating it on more people who are innocent of the misdeeds that they’re rightly pointing out in the past. It becomes a sloppy way. I sympathize with the problems, the solution is where it breaks down. That’s where I think if we can sit down and talk together and resolve this, maybe we’d come up with some interesting ideas. I feel like a lot of the people who speak out against inequality and who are especially vocal about it, especially in the past few months with Black Lives Matter and some of these groups, there’s a bit of an economic ignorance there and perhaps political collectivism where they’re trying to force these solutions on other people. Thereby, they become the perpetrators of the injustice they’re speaking out against.

You have this balance between very strong deep-seated emotions that go back generations. It goes back culturally. That’s when we start out talking logically about the wealth gap, it’s provable. At the same time, people aren’t going to sit back and say, “You’re right. I should think about things differently.” People have these deep-seated emotions that reinforce a perspective. For me, I try to sympathize and empathize with that. I look at some of the extreme things that human beings to this day still do to one another, do to children, do to women and do to the minorities. It’s sickening.

At the same time, you look at history and it’s always happened that way. I look at what do we do now with the “civilized society” that we supposedly live in so that the political sphere is not injecting these cheap, slighted, and shallow emotions into the narrative to gain political capital? What do you do? How do you reconcile all of this? What’s the solution because you have these deep-seated things that are not going to go away and then you have these rational things that we can show, the rich and wealthy people have created much as it relates to our lifestyle?

We use the same internet browser as Jeff Bezos. We have the same iPhone as Bill Gates. They’re not living much of a different lifestyle other than maybe the car they drive and where they go on vacation. It’s not much different. How do you reconcile this, Connor? You’re amazing at taking divisive topics when it comes to liberty and teaching people through books, through education but also promoting principles on Capitol Hill and being influential to lawmakers who clearly have one perspective. They lean toward a party. How do you reconcile all of it?

The market doesn't like uncertainty. We need to have some kind of predictability. Share on X

This one is tough because over the past several months during the shutdown and everything, I’ve been talking to folks about these issues. I feel like among people who are more free-market minded, conservative, libertarian, Republican, whatever you want to call it, there’s a lot of unease in the sense that people have long felt on the foundation of society and their principles and whatever. The degree to which these riots have happened, killings, lootings and all these kinds of things, the way society and culture has been changing as a result of all these events. A lot of these people I’ve talked to have felt uneasy like those footings, the foundation of society is shifting underneath them and they feel that there’s this instability where they don’t know how to act. They don’t know how to step forward. If the ground is loose, how do I know that’s a sure footing so that I can move forward with my life?

There’s absolutely risk and the market doesn’t like uncertainty. We need to have some kind of predictability and this is a tough question for me because how do you forecast things? How do you offer a solution and try and figure out what that approach is? What I’ve seen a lot of families do is think about turning inward. It’s like the story of a tree. When there’s a drought or something to conserve resources, the tree is not going to grow that year. You look at the rings of the tree and when they’re tight like that, that’s during a year where it didn’t have growth. It was in survival mode.

It feels like a lot of families are in that mode right now where they’re trying to say, “How do I talk to my kids about these issues? What do I think about these issues? What voices do I trust?” I’ve seen a lot of these people shift from engaging online or community activism or going up to the Capitol or trying to change the world to say, “I’ve got to protect my family. I’ve got to figure out what we’re going to do and how we make sense of this.” Not only economically, like how’s our job doing but also, if society can shift this much where we’ve got shutdowns, mandates and “Karens.” We have this culture now of shaming one another like, “You’re insufficiently compliance. I’m going to call the cops on you.”

We haven’t had that before in our society. We have riots, lootings, all these blue states and Democrat mayors, letting these people run amok destroying businesses and government buildings. We’ve seen that in Eastern Europe. We’ve seen that in some parts of Asia and Africa and elsewhere. We’ve never seen that in America. That shift is disconcerting to a lot of people. I even feel this way, partially myself, where I struggled to figure out, “Is there anything I should be doing or can be doing right now that I’m not or should I be trying to maintain my balance so that when the ground solidifies a bit more, then I’m ready to move forward?”

Things seem to be changing quickly for a lot of people. I think it’s rational to be like, “I need to wait this out and see where things land.” We’ve shifted a lot. I’ve shifted personally, a lot of my energy into our children’s books, and helping families get material to have these deep conversations and talk about these ideas. It seems like that’s where an investment right now is going to yield a lot of dividends in the future, as opposed to on the policy side of things trying to figure out where to step when the ground is shifting.

I hope you enjoyed part one of this two-part interview. Come back for part two. This is where we get into education. We get into inspiring, influencing and helping kids understand the environment and how to essentially change their life with some simple tweaks. Connor has made some amazing resources available. I’m going to match through the end of 2020 any purchase you make with his steep discount, allowing you guys to give that as a gift to somebody else. Check out all those details on TheWealthStandard.com. Thanks again. Don’t forget to tune into the next episode.

Important Links:

 

About Connor Boyack

Connor Boyack is founder and president of Libertas Institute, a free market think tank in Utah.

Named one of Utah’s most politically influential people by The Salt Lake Tribune, Connor’s leadership has led to dozens of legislative victories spanning a wide range of areas such as privacy, government transparency, property rights, drug policy, education, personal freedom, and more.

A public speaker and author of 21 books, Connor is best known for The Tuttle Twins books, a children’s series introducing young readers to economic, political, and civic principles.

Connor lives near Salt Lake City, Utah, with his wife and two homeschooled children.

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TWS 58 | Wealth Mindset

The Wealth Mindset: The Difference Between Being Wealthy And Being Rich

September 3, 2020 Patrick Donohoe Podcast 00:28:48 Comments Off on The Wealth Mindset: The Difference Between Being Wealthy And Being Rich

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TWS 58 | Wealth Mindset

 

Mindset is what differentiates being wealthy from being rich and mindset is not a buzzword; it is something concrete, something you can take action upon. We are so used to thinking that success is dependent on strategy and tactics. We want the shortcuts. We want a step-by-step formula that we can follow to the letter. But all the brilliant strategies and tactics in the world will not give you what you want if you are not in the right state to experience a wealthy life. Ultimately, success is a function of you – of how you perceive, optimize and utilize what you have at this very moment. Listen to Patrick Donohoe as he explains why so many of our beliefs around wealth and success are turned on their heads and how we can put ourselves in the right state to build efficiency around what we have at this moment.

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The Wealth Mindset: The Difference Between Being Wealthy And Being Rich

It’s been fun for me to talk about what’s on my mind, what I’m experiencing, what I am perceiving in the lives of clients and the business, and my general observations about the environment that we’re in. I hope you have found value in it. I’m going to wrap up a lot of those thoughts in this episode. I had the opportunity to attend Tony Robbins’ Virtual 360 Business Mastery. It’s an event I’ve attended about half a dozen times. It’s the first time in a virtual format. It was good and I want to frame the last couple of episodes with what Tony incessantly talks about, which is state, story, and strategy.

First, I hope you are doing well. I hope you are seeing the environment that we’re in and you’re finding opportunities. You’re finding things to be grateful for. You’re essentially putting yourself in the right mindset and state to capitalize on opportunities because it’s easy to get distracted. It’s easy to be frustrated. It’s easy to look at the environment and use it as a scapegoat for falling short of what you are trying to achieve, your goals, what you wanted for 2020, your business, your profession, and etc. As much as I look at those frustrations out there and potentially, they are more extreme now than before, in the end, it’s those things that we achieve and accomplish that are most meaningful to us. Right now is an opportunity to dig deep, understand what you want, what you want to achieve, and then find within you the strength to pursue and overcome what those challenges are, which stand in the way of getting what you want and achieving the life that you want.

I know that’s why you’re here. I have titled this episode Being Wealthy Versus Being Rich because there is a difference. Being wealthy is finding the opportunity to live life at a high level whether things changed or not, and regardless of the environment. It’s understanding that deep down in our day and age, there’s so much to be grateful for. There’s so much that we are able to experience. Oftentimes, we succumb to this disease of abundance where we forget and have this short-term mentality of how we live versus those that live 50, 60, 100 years ago. I believe that being able to find that opportunities are an interesting paradox. The more you’re in that mindset, the more likely you are.

The mindset of being content, satisfied and happy with where you’re at, with what your life is about, whether things changed or not, that mindset is most likely to get you what you believe is the environment that will make you happy. I’ll talk more about that paradox here. You’re probably saying throughout all of these episodes, what does this have to do with wealth? Why don’t you just tell me what to invest in? Why don’t you tell me where to put my money and give me a shortcut? In the end, wealth is a mindset. The tools, tactics and products and these are what I find interesting. There’s so much debate out there regarding the difference between this product and that product. This has higher fees and this has lower fees. You should invest in this thing and that thing.

In the end, I would say successful investing and becoming wealthy is a function of strategy, but I believe strategy comes after you understand the mindset of what I talked about. It’s interesting, there are many people, whether it’s a real estate project that has been successful, whether it’s single-family homes, multifamily, industrial or storage. There are many different aspects of real estate and people advocate for one or the other, pros and cons, but there have been people that are successful in that area. You also had people go bankrupt in certain areas.

I had the opportunity to go to Southern Utah with my family and some neighbors. It was a huge lake. It’s the Grand Canyon that was dammed up. It’s called Lake Powell. It’s such a unique place. There are hundreds of feet of water and you have these big rock walls. The water is 85 degrees and it’s hot. It’s in the hundreds every single day. When we were there, there were these beautiful boats and it was a new brand. I know some of the executive team. I did not necessarily experience them with high favor in regards to their business practices years before. Typically, during 2008, 2009 when I knew some of them. Yet they had these beautiful boats and they are all over. They’re the most expensive boats on the water, only to come to find out that there were some practices that they had where there are lawsuits, embezzlement charges and several other things associated with it.

Mindset comes first before strategy. Share on X

What I’m trying to say is on the surface, some things look like they are successful. Some strategies and products and investments look like they’re going to bring you success, but there’s so much below the surface that if you’re uneducated, you ultimately learn the hard way. Whether it’s business, stock market, real estate, commodities, gold, Bitcoin, and other cryptocurrencies, those products are important, but they’re not the most important. In fact, they’re the least important. We had several episodes in years past about the Rich Dad B-I Triangle. They talked about successful business as well as investment in the business. The least important thing in that triangle is the actual product itself. Yet that’s where all the focus is.

The State Paradox

For me, I look at what creates success and ultimately success is a function of you. That’s where I want to frame the context now with the equation that I’ve talked about in the past or the formula I’ve talked about in the past, which is state, story and strategy. State is a function of your language, your focus and your physiology. State is ultimately what everybody wants, but they think that some environment is what’s going to give it to them. “If this happens or if it weren’t for COVID-19, I would be this. If it weren’t for the stock market, I’d be this. If it weren’t for the job market, I would be this.” There are all these contingencies that stand in the way of getting what people want in their minds because they believe that strategy and environment have to align in a certain way in order to experience what people want, which is all internal for me.

That’s the irony and that’s why there’s a paradox. I believe that understanding yourself and your mindset, and being mindful of yourself, self-concept and there are other terms for it. The idea is the experience of achievement is a feeling. There’s a focus there and there are also words used to describe it. This is the paradox, being in that state is most likely going to get you closer to what you want or think you want, as opposed to thinking that what you want is ultimately going to give you this specific state. It’s a paradox in a sense because I believe that if you’re content, happy and fulfilled based on what you have without anything being added to you, it is most likely going to attract the things that you want. They will get you and grow you to the next level.

Emotionality Vs. Rationality

Hopefully, that makes sense. I’ve spoken to these principles in a couple of previous episodes. That’s where I look at whether it’s the parody of The Opposite George and Seinfeld or all the different paradoxes that are out there in relation to some of the most important aspects of life. It applies to money as well. That’s the difference between wealth or being rich. What I would say is when it comes to what you want, being in that state is going to help you to have the right focus, the right language in order to perceive the right strategy for you to get what you want. What I would say is, as I’ve mentioned in one of the episodes, a big part of wealth is winning those battles between your emotions, reality, logic and rationality.

There are such heightened levels of emotion regarding what’s going on. Elections are part of it. There are also states that are doing specific things. You have the debacle with the post office. What I’m going to do is I’ll use the example with the post office. What people place as meaning under the post office is that it should exist, be funded and get money so that there’s fairness in the elections. If you remove the post office, you don’t allow that to happen, then there’s somehow not going to be fairness and justice. There’s a couple of different ways to approach that argument. There’s an emotional side of things that typically aligns with a political party and how you think things should be run in our country, but then you also have a rational side of things. I would say that wealth is understanding both sides, then being happy whether it goes one direction or another direction.

If it goes one way or the other way, then your happiness is now contingent on something that’s outside of your control. With the post office and don’t confuse the former Postmaster General with me because his name is Patrick Donahoe. It’s spelled with an A instead of an O. How I look at what the post office as far as service is concerned is the amount of money that the taxpayer has given to them over the last ten years, which is upwards of $100 billion. That’s $100 billion that needs to be given to them because they’re not creating the revenue as far as expenses are concerned. There’s a $100 billion shortfall if you measure out all the different bailouts they’ve been getting over the last ten years and specifically the $25 billion.

TWS 58 | Wealth Mindset

Wealth Mindset: Being in a state of fulfillment gets you closer to what you want, not the other way around.

 

If you look at the service of the mail and what it specifically does. This is where there’s a proper role of government when you break down the fundamentals of it, but the government has taken this role in solving everybody’s problems. If you look at it going to the rational side of why the specific government was created and what its role is versus what it is now, that’s the rational side of things. There is so much emotion and I might even get you blowing up on me, unsubscribing, and giving me hate mail. That again proves my point where there’s so much emotion involved with these discussions that people do not peel back the layers of reality and rationality. Ultimately, the post office provides us with service in an incredibly unprofitable way. $100 billion of opportunity costs where that money could have either not been taxed printed by the Federal Reserve.

The private sector has solved a lot of those problems anyway. We can deliver things to people’s houses. There are some technical things involved in that, but look at what we’ve been able to do as a human race, especially in the last few years with technology. There’s so much complexity in the different innovations that have occurred. The iPhone 12 is about to come out. There’s so much computing power and so much below the surface of that screen that is brilliant. Sometimes you step back and think about what went into that and how was that created, all the different supply chains, materials, the innovation and the design. It’s incredible. The complexity of that shows that human beings can get together and provide a product and service that is way more efficient than typically a government can provide because that’s not necessarily their role

The rational side of things is what’s being displayed now, but emotions are attached to this argument because it’s associated with elections. Elections go into the different parties and then it goes into who’s right and who’s wrong. It goes into all of these deeper levels of emotion. I’m not saying from an emotional standpoint that this party is right or this party is wrong. Going into a rational conversation, you have to understand where your emotions are and specifically as they relate to potentially being wrong. Maybe there’s another opinion that might be important to understand. Having those stifled or muted for a moment to understand the logical side of things or even another perspective. If you can win that war, that’s true wealth. The last thing is having a lot of money and having a miserable life.

I’m going to use another example. There are more people that are planning on leaving California because of the proposed income tax hike, which taxes the wealthy, the higher echelon of society there because quarantine has impacted the lives of many people. At the same time, if you think about the rational side of things, the buzzword is justice, social justice, economic justice and wealth inequality. I’m not going to get into the details here because these are highly emotional topics and I’m bringing them up because I want you to discern between the emotional side of things and the actual logical side of things in order to come to a conclusion. Hopefully, in most cases, you realize that most of the stuff you get emotionally stirred by, affected by and influenced by has little meaning to the quality of your life which was fascinating to think about. I won’t go down that tangent. As far as taxes are concerned, the understanding that people are affected by COVID-19.

As individuals or human beings, we seek comfort. It’s natural for us. It’s part of Maslow’s Hierarchy of Needs. We see seek safety. What’s interesting is when safety and comfort are given to somebody without any effort on their part, what it does is cancels out the experience of comfort. It also robs the individual of one of the primary things that separate us from the animal world or the animal kingdom, which is our ability to rationalize, problem solve, think through things and come up with solutions. When somebody achieves, especially an achievement that puts their economic wellbeing in jeopardy when somebody overcomes that. They find another job, they move to a different state, they get training and learn something new and are now more valuable and get a different job. The impact that has on the human soul and what a person is able to feel about themselves and the confidence that they have, that is what human beings are capable.

It’s essentially being robbed by providing stimulus, unemployment benefits and a Band-Aid to what’s going on. I know some people are down and out more so than others. At the same time, you stifle the experience of life that’s most meaningful when you rob people of being able to figure out their own problems and overcome their own challenges. This now goes into the proper role of the government. Is it the government’s job to tax more and then give to those that are impacted by this? I understand the arguments on both sides, but my point is to bring up this high emotional conversation. It helps you realize how much that impact the quality of your life, especially when it comes to the things that you can’t control and don’t have much relevance to your specific environment and your specific life.

There are ways to be more efficient with what you already have. That’s where all strategy should start. Share on X

That being the case, this goes to the state. You look at what you want from your life, where you’re at right now, and the gap between where you are and where you want to be. Inside of that gap is a state. There’s a story that comes from the different states that you’re in. Usually, the state is it’s the stock market’s fault or it’s my employer’s fault, or my colleague got a raise and I didn’t, and it’s not fair, or this happened or that happened. We always have excuses. We always have a story about why we’re not in the place that we want to be. That’s unfortunate but looking at a state shift, being able to change your state and there are three variables to state: different physiology, different focus and different language. When you start to use a different language, you start focusing on what you have, not what you don’t have. You’re able to think back on the times where you have achieved, overcome and succeeded. That then is going to be a different story and the way in which you perceive strategy, tactics and things to do.

I know all of you want shortcuts and want the things to do, want the strategies, want the tactics, but without state and story, those will rob you of the experience and most likely, it will not help you even if you did get them. I believe that most people with the wrong state and the wrong story will not be able to use strategy in an effective way to get them from point A to point B and overcome that gap. It’s natural for us to respond to the circumstances of life with excuses, “This happened, this person left me, this person cheated me, my employer this, my employer that, the government this, the government that, the president this, the president that.” When we started to take accountability for our life, that’s when our state can change and doors of opportunity open up to apply a strategy.

The Efficiency Formula

Now, I’m going to give you some strategy. I do tactics but I’m going to give you some simple ones as an example. Many of you had read the season I did on capitalism. If you remember Hernando de Soto, which I tried to get him on the show two dozen times. He’s old and was sick, but he wrote the book, The Mystery of Capital. It’s a fascinating read. I’d encourage all of you to read it. It’s written in a simple way where most people without an economic background can understand and benefit from. Capital comes from the word cattle. The reason why it comes from the word cattle, in and of itself a cow, he didn’t say it was where the value was. Capital is created as a byproduct of the cow. What that means is here’s the cow, now how do we optimize the different elements of a cow, the meat, the leather, the milk, it keeps going on and on, the different types of meat. My wife is from Mexico and they eat cow tongue there and intestines. There’s an optimal way to look at all of the different elements of a cow and essentially derive additional value more so than what’s experienced on the surface, which is just a cow.

It’s the same thing with petroleum. Petroleum was just oil. It was this nasty stuff in the ground that bubbled up and ruined crops for farmers. We’ve learned to make many different things as a derivative of that. That’s capital. What I’m trying to get to here is in your specific life, there are ways to be more efficient with what you have. That’s where I would start. That’s where all strategies should start. It’s not adding, but being more efficient with what you already have and deriving opportunities from what’s going on. Let me give you some examples. Interest rates have been extremely low and I was able to refinance all my rental properties. I have a small mortgage on my home but other than that, no personal debt. I carry mortgages on all my investment properties. I was able to increase cashflow by thousands of dollars by refinancing with very little money out of pocket. I was able to skip some payments as well.

It’s finding ways to be more efficient with what you already have. That’s a great example of doing that. If you have personal debt, refinancing personal debt and ultimately paying it off, student loan debt and car loan debt. It’s being more efficient with your cashflow. The second thing for me is being forced based on what has happened with shutdown and quarantine. You’re not spending as much because you’re forced to not spend in a sense. Many of you may have an Amazon addiction, but it’s looking at what comes in and what goes out. From a spending standpoint, I know that there are record levels of people paying off their personal debt because of this increase in discretionary income. That’s another thing, it is to pay attention to what’s coming in and what’s going out. I’ve referenced you need Budget, which is a software I use for my personal finances. Go over to the website, TheWealthStandard.com. There’s a link there. You’ll get a little discount for signing up, but you need Budget.com.

Now that you have maybe some handle on where your cashflow is and an efficient spending plan, you’re going to find equity. You’re going to find the difference between what you make and what you spend. That’s cashflow. One of the things, and this is a very simple way of doing it, it’s a psychological shift, which is setting up a separate account. I call mine the Donohoe Family Fund and it has rules associated with it. Out of that fund, no money is spent on consumption. It’s all investment or putting money into a financial product. This fund is completely separate from your checking account and operational account. Sometimes people have found it useful to have those accounts at different institutions. I have mine at the same institution but what it is, is to separates. It creates rules around it and stick to those rules.

TWS 58 | Wealth Mindset

Wealth Mindset: Focus on what you have, not on what you don’t have.

 

Looking at that, when money comes into this specific account, I usually advocate six months of liquidity, whether it’s in a specific liquid guaranteed safe environment product, not a bank account but more of a product. We use insurance with my company, Paradigm Life, but even inside of this fund, it’s having at least six months of liquidity. That’s even before paying off personal debts. I would say having that liquidity, those reserves, there’s something psychological that happens when you know that you have money in the bank that can last you six months. There’s something that happens that triggers something and creates a level of safety and certainty that allows you to operate a little bit differently. You then essentially go through what to invest in and what type of assets.

There are two things I’m going to bring up. I’ve been working on ways in which we can do some online technology applications that are more self-assessment in nature. I’d love your help. One of them is specific to what I’m talking about. It’s called the Financial Independence Calculator. It’s in an Excel spreadsheet. I would love for you to access that. I’m going to ask for your email address because I want to request some feedback. I’m developing some software and getting some feedback from you will help with the whole user experience that people have. If you would download that, check it out. What it does is it gives you a Financial Independence Day. It is a function of your saving, your investment cashflow, as well as your ideal scenario in which you produce and work. I hope you like that one.

That’s a great first investment but there’s a second part, a second calculator called The Hierarchy of Wealth. This is something I talked extensively about in my book, Heads I Win. Tails You Lose. If you don’t have a copy of that, that’s also available for free, both the PDF and the audiobook in TheWealthStandard.com. You can go to Amazon and buy the book or download an Audible book. There’s Kindle as well, hardcover, softcover, but this is a way in which you can get access to it for free. You can learn about The Hierarchy of Wealth there. There’s a calculator that they developed. It’s in an Excel spreadsheet. What it does is it helps you to identify all the different assets that you have and it ranks them in a specific hierarchy.

The hierarchy that I came up with is a function of risk and control and you will see that in there. That will help prioritize what I call your opportunity fund. Once you have money that goes above and beyond your liquidity, your six months or some of you may want 12 months or 18 months, depending on your comfort level and what gives you that feeling, that psychology of certainty. When there’s money above and beyond that, it becomes your opportunity fund. An opportunity fund is to make an investment. Making an investment, you want to know, “Where are the opportunities to invest?” What I would say is to understand where your other investments are first. That’s where The Hierarchy of Wealth comes from.

The Hierarchy of Wealth will help categorize all the assets that you have and then give you some insight into potentially where are some types of investments to think about first. For me, one thing I am adamant about regardless of where my investments are and how my assets are allocated. As I mentioned, Business Mastery by Tony Robbins. I’m huge about personal development and investing in myself to become a better leader and to understand business strategy, leadership strategy, operational strategy and financial strategy within the business. I believe that’s where the most control that you have and where you can ultimately find the best returns. I believe your business and your profession is what creates liquidity. That liquidity is then invested, which creates cashflow and subsequently degree of wealth, and more options when it comes to money.

This is a shorter episode but I’m glad that you are on. Please go to TheWealthStandard.com to access those two free self-assessment spreadsheets. I’d love to hear your feedback. That’s it for now. There are going to be some cool guests. One specifically is going to talk about education and what’s going on with our kids and options you may not have thought about before. We’re also going to probably get into some other libertarian type of topics. It’s going to get juicy. Thank you for your support. If you like what you read, head over to iTunes, Spotify and give the show a good rating. That always helps to get the word out. Share it with friends and feel free to share all these apps and other resources with your friends as well. I will talk to you next time.

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TWS 57 | Laws Of Human Nature

Understanding The Laws Of Human Nature With Robert Greene – A Replay

August 27, 2020 Patrick Donohoe Podcast 00:48:46 Comments Off on Understanding The Laws Of Human Nature With Robert Greene – A Replay

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TWS 57 | Laws Of Human Nature

 

If we get to know the laws of human nature, there is nothing stopping us from becoming the best in whatever we do. Patrick Donohoe has been mulling over this thought following a profound conversation with his 14-year old daughter about how we perceive ourselves and other people. In this episode, he revisits last year’s episode with bestselling author Robert Greene, where they talk about his book, The Laws of Human Nature. The interview was a deep and insightful take on how we manage other people’s behavior and, more importantly, our own behavior patterns, making it one of Patrick’s favorite episodes in the podcast. The value from this interview never gets old, so sit back, listen and learn.

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Watch the episode here:

Listen to the podcast here:

Understanding The Laws Of Human Nature With Robert Greene – A Replay

Thank you for tuning in. It’s going to be a solo episode and I’m going to be brief and then replay one of my most favorite interviews of all time with a man named Robert Greene. It is talking about the book he had released at the time called The Laws of Human Nature, which will stir you deeply so get that book. First, if you have not visited the Resources section of the website, we have some free courses on there. One specifically talks about the entrepreneur in a way in which an entrepreneur can set up their financial life. One talks about the wealth maximization account and another, which is specifically for real estate investors. Go check that out. They’re free to you.

Also, the book that I wrote called Heads I Win, Tails You Lose: A Financial Strategy to Reignite the American Dream. Go pick it up for free. It’s a PDF version. It also has an audiobook attachment to it. You can go on Audible and pay for it. You can go to Amazon and pay for the hard copy. You can go to Kindle and pay for the eBook there. This is the way in which you can get introduced to it for free. There are also other resources on there that I believe will be helpful to you. There’s been something I’ve been thinking about a lot, and this is why I want to replay the interview I had with Robert Greene.

I’ve mentioned on the show before a profound conversation I had with my daughter and she made the comment. It was an observation that she had. She said, “Dad, do you realize we’ll never see ourselves? We’ll never physically experience ourselves.” I thought that was insightful, especially for a young person. That’s my middle daughter and I continued to think about that. I’ve made some connections that I’d like to share with you. First off, she’s right. I don’t think we’ll ever physically experience ourselves with all of our senses. We can see ourselves in the mirror, like a reflection. We can touch ourselves, hear ourselves speak, but it’s a little bit different because when you hear a recording of yourself, especially if you’ve never heard one before, it sounds different.

It’s something that I find interesting as far as how we experience life, all the senses that we have, and how we take in those senses. The light, the sounds are all energy. That’s all processed in our mind and we make sense of it. The connection I made is that you go to old movies and when a person sees themselves in a reflection or a mirror. Maybe it’s an old movie, they don’t have mirrors around and somebody sees themselves for the first time. There’s a connection we make with the character about that experience of, in a sense, experiencing themselves.

I also look at why people are afraid of public speaking or having a picture taken. My sister-in-law hates her picture being taken for whatever reason. I’ve looked at what anxieties people have, and it’s not speaking in front of people. It’s more of the fear of what response you’re going to get because we live vicariously through the opinions of others. What do they say about us? What do they think about us? What do they validate? What do they confirm on the contrary? What do they criticize? What do they don’t like? You can have 100 complements and get all of those wiped out with one criticism.

I look at it as our innate desire to want to understand ourselves, and we do that through others. I look at our society and there are lots of signals going on. We identify ourselves without a person giving us their perspective and signaling is the cars we drive, where we live, the clothes we wear, where we vacation. There’s a lot of physical manifestation that it represents. Look at cars. If somebody drives a Hyundai, an old car, a truck, or a fancy sports car, those are all signals and we’ve used those to make a judgment about somebody else. I’m not saying that this is all good or bad. I’m saying if this is the case, then being aware of it is going to help us get closer to what we want.

I don’t think we want that. We don’t want compliments. We don’t want people to necessarily say certain things about us. We want to know that we have value in the world. That’s where I look at one of the things that I talk about in my book, which is one pillar of financial independence is the discovery of meaningful work and doing that as a full-time profession or career. Meaningful work, I believe is you discovering something that’s a value inside of you and providing that to somebody else.

TWS 57 | Laws Of Human Nature

Laws Of Human Nature: We don’t want compliments. We want to know that we have value in the world.

 

That demonstration gives a sense of value validation, meaning that it’s difficult to match based on having some physical thing that represents your value. I look at that as one of those things we discover over the course of time. If somebody can discover that about themselves, it clears the path to a level of financial independence. I would say in any investment, dollar amount, bank account balance could give you. Those things are important having liquidity, reserves as well as investments that are passive in nature and provide you income so you can exchange that amount of money for the life that you want to live. In the end, if you miss that third pillar, which is meaningful work, contributing who you are to society in some form or another and continue to grow that, then the level of independence and level of fulfillment is simply, in my opinion, not going to be there.

I look at Robert Greene and what he’s written. He has a number of books and they’re all thick. The Laws of Human Nature dives into how people are, how they act, what they think, what they believe. In the end, our life is short. Our experience of life is interesting, whereas I mentioned in the episodes, it’s paradoxical. The closer we get to understanding ourselves and understanding how to reach those levels, those states of fulfillment and feelings of fulfillment, the more wealthy we are. Wealth is to get a person to that state, or at least that’s what we’ve been conditioned to believe.

I believe you can get there in other ways. Money is a part of it. It’s a fast way to get there, but once you have the money, the financial wealth and material things, it does not create the wealth that we want. Read the interview with Robert Greene with that context. I hope you find value in that. Thanks for reading and paying attention and trying to learn about the episodes. I know it’s been unique and me going off. It’s to help me understand what I’m thinking and create some breakthrough moments for me. I hope you find it valuable. One of the things that I will say in relation to meaningful work is the idea of creativity.

This for me is fulfilling because I’m able to speak and express myself and, in the process of doing that, learn more about what I believe, what I think and what I want. Our society is also demonstrating that. They also want to know yet it may not be as channeled and focused as it can be. You see that in the diatribes, on social media where people go off and criticize people and make comments about political things and write these huge novels in relation to something that may not be that significant to anybody else. The act of doing that is this desire for us to express the uniqueness to discover who we are at a deeper level. That creativity, once you can connect it and channel it in a way where it benefits and helps others, there’s an exchange for that. That’s some of the most rewarding activities and experiences ever. I’m off my pedestal. Thank you for reading. Enjoy this interview with Mr. Robert Greene. That’s it for now. Take care and see you on our next episode.

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Thanks for tuning in to this episode and our season around the topic of entrepreneurship. My guest is none other than Robert Greene. I’m fortunate to get to interview and learn from some fascinating individuals and Robert Greene is right there at the top. He boasts six New York Times number one bestsellers. Those titles are The 48 Laws of Power, The Art of Seduction, Mastery, The 33 Strategies of War, and The 50th Law who he wrote with the rapper 50 Cent. He’s also the author of the book, The Laws of Human Nature, which we’re going to be discussing. A successful entrepreneur doesn’t exist without other people. I don’t believe a fulfilling life is possible without other people.

The nature of a human being, our drives, instincts, emotions, and behavior have been studied by millions, yet humanity continues to be ripe with the dark side, war, murder, abuse, bullying, infidelity, divorce, bankruptcy, corruption, depression, anxiety, and the list goes on. Even though we have made incredible strides in an array of areas that snare still remains elusive. What does that have to do with you and what do that have to do with entrepreneurship? It’s no secret that a lot of businesses fail. I’m sure that’s not the initial intention and the amount is much more than those that succeed. Those ideas without execution are worthless and that execution without other people, other humans assuming a successful investment is a lottery ticket. Get this book, The laws of Human Nature, by Robert Greene. Let’s go ahead and welcome my special guest, Robert Greene.

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It is truly an honor to have Robert on the show. Thank you so much for joining us. This is one of those amazing interviews that I’ll benefit from and be excited about it.

You need to master people as a skill. If you offend people left, right and center, you’ll never get funded. Share on X

Thanks, Patrick. I hope I can live up to the hype.

You’ve made such a difference in the lives of my as well those that have influenced me. I found your book, The Laws of Human Nature, fascinating. You’ve written so much. This is your sixth book. The first thing that came to my mind, as far as what to ask you, is the circumstances that inspired you to write the book and some of the elements that perhaps weren’t in the previous books that you wrote. What was the backstory to that?

There are several channels that go into what influenced the book. In Mastery, I had a chapter, Chapter 4, on social intelligence. The basic idea was to, as a book, teach you to have to become a master in whatever field you’re in. You’re not going to be graded, whatever you do unless you also know how to get along with people because we’re a social animal. You could be technically brilliant, a consummate computer hacker, but if you offend people left, right and center, you’ll never get funded, etc. I wanted this to be an element of what you need to master. You need to master people as a skill. I got a lot of feedback from readers from that. They enjoyed that chapter, but the main thing was, “Robert, it wasn’t enough. It was juicy, it was tantalizing, but we need more.” I thought, “Maybe I’ll respond to my readers and I will expand this into an entire book.”

There were other things going on as well. My first book came out many years ago, The 48 Laws of Power. Since then, I’ve done a lot of consulting with powerful people in different fields. I’ve had a lot of experiences in helping people with their problems. I’ve seen these themes in which people don’t understand the basic elements of human psychology and it leads to all problems. They hire the exact worst employee based on their resume, charm, and looks. All problems ensue. They partner with the worst business partner who ends up being aggressive that they push them out or they get involved in intimate relationship with someone who ruins their life. Why are people bad at these choices? They’re not good at understanding people. They’re not paying deep enough attention. They’re only looking at the surfaces.

Based on Mastery and based on my experience with consulting, I felt a deep need out there to help people understand certain basics about human psychology and what governs human behavior. There are patterns that I’ve seen in my own life and in the people I deal with and these patterns are what I ended up calling human nature. Unconscious forces that govern a lot of what we do that we’re not even aware of. I want to make you the reader of these forces inside you so you can break your own bad habits. I want you to be able to see them in other people so you can understand others on a much higher level and be able to influence them instead of always being frustrated by the people you’re dealing with.

It’s one thing that I associate with what most people can because we tend to look at the world and assume other people look at the world the same way. Getting back to the premise of the book, when a person sits down to read it, what have you seen as the outcome, the result of somebody who has read it, and where it’s made an impact?

I haven’t gotten a lot of feedback, but I have been getting some. One of the main themes, which is not too surprising, but it wasn’t exactly what I expected is that it’s making people think a lot about themselves. They’re reading the book and they’re reading about narcissism, or they’re reading about envy or aggression. They’re going, “I have some of these traits in myself. I’m not as great as I thought I was. I thought that I was this nice person who’s always considered and thinking about other people. Maybe that’s not true. Maybe I need to reconsider some of my flaws, dark side and shadow sides,” as I call it.

TWS 57 | Laws Of Human Nature

The Laws Of Human Nature

One of the main effects is it’s making people reassess who they are and rethink some of their own behavior patterns. I went through that in writing the book. I’m writing a chapter on narcissism and I’m going, “You’re more narcissistic than you think.” It’s an eye-opener as I was seeing traits that I was writing about in myself. The number one thing that stood out in people reading the book so far is that it’s held up a mirror to them and made them focus on themselves instead of always pointing blame at other people. Always blaming others for the problems in their life. Looking at themselves and saying, “Maybe in some ways, I’m the source of some of these patterns that are going on.” That’s been the main impact.

If you become aware of yourself at a deeper level, you form conclusions based on an understanding of what’s right and what’s wrong, what’s good or what’s bad. Does that change? If your frame of reference, as far as what life is about, hasn’t changed and you’ve become more aware of yourself and maybe more of your flaws and anything else, that’s going to be somewhat disappointing. This is one of the things I got from it. It is more understanding of the context of life and what life is about, which oftentimes is one of those things that we’re not always aware of, at least on a short-term basis. Does that resonate with some of the feedback you’ve gotten?

It’s not intended to make you depressed, hate yourself, or dislike yourself. It’s meant to have the opposite effect, which is a lot of the feedback that I’m getting. Now that you’re aware of some of these tendencies that are innate to all of us, you can start to begin to change yourself and you can start getting out of denial. For instance, I have a chapter on envy and where I say that this is rooted in human nature is that the human brain operates by comparing. That’s how our knowledge is formed. That’s what neuroscientists have discovered. As a social animal, what this means is, not only are we comparing information from the environment, but we’re continually comparing ourselves to other people around us.

If you look at yourself in the course of a day, you’d have to admit that you’re continually comparing yourself to your peers, to how much money they make, how much respect they’re getting, how much attention they’re getting on social media, etc. You can’t help it because that’s how the human brain works. That’s where envy stems from. If you are continually aware of what other people have, and it looks like they have more than what you have, you’re going to have feelings of envy, but you’re going to disguise it to yourself. You’re going to disguise it in the form of, “That person doesn’t deserve his success. He’s not worth it. He’s not good.” You’re going to criticize them, or maybe you’ll even take action against them without ever realizing that envy is the source of your emotions.

I want to tell the reader, there’s nothing wrong with feeling envy. There is nothing wrong for being a human being, feeling aggressive, or being self-absorbed. I want to take the guilt out of all of this. I simply want to shine the spotlight on who you are, so that you can maybe take that mechanism of comparing yourself to others and turn it into a positive, which is what each chapter in the book ends with. It’s how you can take this quality and turn it into something productive and positive. If that’s the moral or the goodness component, then that maybe it. Instead of constantly comparing yourself to others who are better than you, why not compare yourself to others who have it worse than you, so that you can feel some gratitude for the success that you’ve had, for the family that supports you?

Look at people who have less. Sometimes the people you are envying, if you got to know them, you would realize that their life is quite miserable. They’re not as happy as they seem. On social media, people always give the impression that they’re taking the most wonderful vacations. They’re meeting the most fabulous people but if you got to know them, their lives are as boring as you could possibly imagine. Maybe there’s no need to envy them on and on. How you can take this comparing mechanism and make yourself a better human being out of it?

In your experience in writing the book and researching, was there anything that you became aware of that made an impact on you or maybe changed the direction of the book?

You’re more narcissistic than you think. Share on X

I always go into books with an open mind. I have a bias. My bias tends to be somewhat negative. I have a somewhat negative view of human nature. If you know my books, you recognize that, but I didn’t want that to govern this book that I wrote. I want it to be open-minded. I wanted to read books like Steven Pinker’s book who’s much more optimistic than I am. It’s to shed a light onto some ideas that I don’t necessarily share, but that I don’t end up writing a book that’s pure confirmation bias. There were things in the process of opening it up that did surprise me. I did a chapter on aggression and I read a lot about anthropology and the sources of aggression in human beings. It was quite surprising for me to realize that our hunter-gatherer ancestors going back many years ago were violent and aggressive.

This notion of the happy tribe member living off the land and being happy and all that. There were extremely high murder rates. There were wars going on, constant skirmishes, high degrees of envy, murder and violence within the tribe. I had that predisposition to maybe think that, but this was quite shocking for me to realize. A problem that we have is we tend to want to think of us humans as being this ultra-sophisticated creature who created the internet, who are sophisticated and so far removed from our primitive past. I don’t believe that. We’re still much a slave to this primitive past. I kept an open mind, but a lot of the research that I had confirmed these ideas.

I looked at how DNA and what we’ve come to understand as far as it’s concerned. There is a degree of sophistication that’s different than our predecessors. At the same time, our instinctive nature seems to be similar. In this day and age, it seems like the accountability factor to who we should be, how we should be happy, or what we should wear is much higher than it was before. We’re driven more in a sense, but at the same time, there are these natural things about us that are there. Oftentimes, we consider that a flaw. Do you consider that a flaw or do you consider these natural attributes, tendencies or drives to be what they are and not necessarily good or bad?

Nothing is good or bad. It’s human nature. The problem that we face is that things evolved back hundreds of thousands of years ago for a purpose or a reason. We evolved as social animals that had to have an extremely tight cohesive group in order to survive because humans are physically weak and we could only survive by working within numbers and groups. We developed extremely high empathic powers. Before the invention of language, we could sense the emotions of other people around us without ever having to say anything. This viral vulnerability that we humans have, it was part of our survival. It is not adapted to the 21st century in life.

What it means is we’re open to the ideas and opinions of other people. We see that on social media. It becomes hard for us to detach ourselves and think for ourselves and think rationally instead of always being moved by the tribes that we belong to, by the heated political discussions of the people we always agree with. It’s hard for us to divorce ourselves because this has bred into us and wired into our brains. It served a function thousands of years ago, but we no longer are living in groups of 30 people. A lot of the things that evolved early on aren’t adapted to 21st century life and that’s what causes us many problems.

You mentioned about your interactions with high-level influential people and you see a lot of these elements of human nature at the highest or lowest levels and in between. In the end, an understanding of this, what does that give someone? They become aware that they’re an individual. They become aware of themselves and it’s not necessarily part of an abstract group but it’s the individual, their character, makeup, desires and so forth. When a person becomes aware of that, how does life change?

It revolutionizes them. That’s the whole point of the book. It should change everything that you do and everything that you think. It should have a radical effect on the reader. I don’t write books that are a soft little, “Maybe, I’ll think about this.” I want to go inside your head and change how you look at the world. Take, for example, law number seven, about how to influence people. I have argued that people are naturally defensive. If you go up, normally you’re locked inside of your mind. You’re always thinking about your desires, wishes, and you want them to fund your startup for instance. You think, “My startup is wonderful. I’m going to give them a great pitch and they’re going to love it and that’ll work.” You’re working against human nature because people are naturally defensive. They don’t have any reason to support you. They’re not naturally your ally. There has to be something in their own self-interest.

TWS 57 | Laws Of Human Nature

Laws Of Human Nature: Compare yourself to others who have it worse than you so that you can feel some gratitude for the success that you’ve had.

 

We are all overworked. We’re all over tasks in the world and have one more person coming at us, trying to influence and telling us about our idea and go, “I can’t take it.” You’re never going to realize this. You’re going to go give them your pitch and say, “That’s wonderful.” Two, three days or you don’t hear anything a week, two weeks. Finally, you realize they’re not interested at all. It’s because you didn’t understand something basic. The people you deal with have an opinion about themselves. I go into this in the book and I explained how that opinion is formed. We all have certain basics about how we think of ourselves. We think of ourselves as morally good, as autonomous that we control our own lives, and as intelligent. At least relatively intelligent for the field that we’re in.

There’ll be other aspects of that opinion that might depend on the individual like, “I am super self-reliant or I’m a rebel. Nobody tells me what to do.” If you go in there with your pitch or idea, and you somehow challenge that idea, you make people feel that maybe they’re not intelligent or maybe they don’t know what they’re doing. It’s not your intention, but you’re implying it. You’re going to make them defensive. Instead of lowering their resistance, it’s going to make it harder for you to try and get to them. You have to understand that you need to set things up before you hit people with your idea. You need to lower their resistance. You need to validate who they think they are.

It’s not necessarily crap. People are generally good. They do have good qualities. If you validate them, if you make them feel that they are intelligent, that they are moral, they’re not going to be as resistant to you. Simply getting outside of your mindset and your own self-absorption and thinking about the other person’s needs and what they’re missing in life, give them validation. Already the whole game has changed 180% right there. You’d be shocked at how many high-level CEOs, powerful people in the entertainment industry that never used this basic idea. They were violating that law continually. It’s understandable because we’re wrapped up in ourselves that it takes an effort to think inside the mindset of the person we’re dealing with and try and get inside their way of looking at the world. If you’re able to do that to some degree on all of these laws that I talked about, it will change everything that you do.

Our life, in large part, is our relationships. Most satisfaction and happiness come from that. I want to make sure we hit on this. I would say one of our instrumental relationships to happiness is our partner. Would you maybe talk about the section in the book where you go into masculine and feminine, men and women?

I’m glad you asked that because that’s the chapter that people ask the least about. Essentially, I’m trying to cover all aspects of human nature and one of the key aspects is our gender, our sex, and how we relate to it. I was deeply influenced by my research by a famous psychologist named Carl Jung, who talks about an anima and an animus. I’m thinking of this in reference, and so is he, into the intimate partners that we choose in our love relationships. It also affects our work relationships. In the work world, we all have to deal with men and women, where men are working for female bosses, but women have always been working for male bosses. It also influences the work world. What Jung discovered was, start with a man. In his earliest years began in relationship to his mother most often. Those first two years, 98% of his contact is powerfully, physically only with the mother. That female feminine presence, her female feminine energy, which is different than a man’s.

I don’t care how politically correct we want to get, men and women are biologically different. That energy from the woman, the mother he takes inside of himself, she becomes a part of him, has a deep impact. When you’re 1 or 2 years old, you are vulnerable. You were open to influence. It’s amazing. A young boy interjects that presence of the mother, and it becomes a part of who he is. It becomes a part of perhaps some of her qualities, if she’s a gentle, loving person or she’s maternal. Not all mothers are alike and they don’t have to be. That becomes a part of him. He carries that within himself. As he goes through life, Jung called that part for a man an anima. It’s a little woman that lives inside of the man that came from the mother. It can also be influenced by siblings and sisters as well but primarily from the mother. He carries that little mother figure within him.

It influences forever throughout his entire life, his choices in the women that he wants to partner with. He may be looking for someone like that mother figure, who has that nurturing quality that he has in himself that he never developed, or if his mother didn’t pay him attention. This is a common pattern. Let’s say she was narcissistic and was more self-absorbed and not such a good mother. He’s going to spend his life looking for a woman who is similar to his mother. Oddly enough, who is self-absorbed in the perverse idea that he will be able to turn it around and make that relationship work as if you could go back in the past and rewire his mother.

The human brain operates by comparing that’s how our knowledge is formed. Share on X

It doesn’t make logical sense, but Jung who studied thousands of married couples found this pattern over and over again. The woman has the same thing with the man. It’s called the animus. It’s the father figure. That energy isn’t as direct early on, as powerful as the boy and the mother, but it’s still powerful. She takes the side of herself. She internalizes the presence of that man and that male can become a voice in her. A lot of animus figures that women carry are critical because a lot of father figures or men will tend to be critical of the woman. She’ll internalize these critical voices that you’re compared to a bunch of judges in her head, always judging her for her looks and for not being good enough at this or that. She’ll make odd choices based on her relationship with her father.

I talk in the book about Jacqueline Kennedy Onassis. She is one of the classic figures in this. She had a father who was a total seducer, a total rake. He could never be faithful to any woman. Her parents, in fact, divorced but she loved him and he loved her and they were devoted. They were extremely close. Throughout her life, she constantly was partnering with men who were the mirror image of her father, John F. Kennedy, who cheated on her left, right and center. Aristotle Onassis, who cheated on her left, right and center, powerful men like her father. She couldn’t break that pattern.

The other element of the chapter that’s important is to make you realize that men have a deep feminine part of their personality that comes from the mother figure. Women have a masculine side of their personality that usually comes from the father figure. You’re either in deep denial of that aspect of who you are, in which case you repress it and it comes out in weird ways, or you’re able to integrate that part into your character and make it something strong and powerful. A man who can still be manly and masculine but use his empathetic side who can use some of that kindly maternal energy from the mother will be a better person, a better man for that, for integrating all of these parts of his personality. I can go on and on, but that’s to give you an idea.

Going back to when we first started talking on this topic, the male and female relationships that exist, whether it’s the workplace or in social circles or you’re into your intimate relationships and they’re biologically different. It’s not instinctive that a man can empathize to that level with a woman. You’re essentially saying that because it’s not instinctive, becoming aware of it, observing, understanding and learning about it is going to improve the way in which you embrace your feminine and masculine side, and then vice versa and the person that you’re engaging with.

I know your time is super valuable and I appreciate the time you spent. What’s the significance of not necessarily observing yourself and your nature and what compels you, but also in all the different environments that you’re in being aware and observing others? If you were to sum up it in one sentence, it’d probably be along those lines from what I’m assuming. What does that give you? Why is that important to somebody?

There are many ways to answer that question. First of all, as a social human, it’s essential that you develop the skill to cut off your internal monologue and observe the people around you. A lot of people in the world, instead of supporting this are not only finding problems, dealing with people, but there’s a lot of loneliness in our culture. You may be doing okay in your career, but your relationships are brittle. They’re not deep and they’re not sad, fulfilling. A lot of it is because you’re not paying deep attention to the people around you. You’re not understanding them. You’re more about yourself and what your own needs are, and other people can sense that. It creates these lukewarm relationships.

Also, because you’re not paying deep attention, you’re making all mistakes in your career. Being able to get outside of yourself and observe people is essential to surviving in the world, to building better relationships and to have more success in your career, because everything depends on your social and political skills if you’re working in an office. The moment you put three human beings together in a room, politics intervenes. You have egos and you have to think in these terms. You need to be able to observe people and understand that. Some scientists estimate that 95% of human communication is nonverbal.

TWS 57 | Laws Of Human Nature

Laws Of Human Nature: We’re so wrapped up in ourselves that it takes an effort to think inside the mindset of the person that we’re dealing with and how they look at the world.

 

The way people smile, they’re fake smiles. How to differentiate a fake smile from a real smile? How to sense when people are smiling, but they resent you? There’s some underlying resentment there. It’s powerful, or how people, when you first walk up to them, their body language reveals whether they’re excited to see you or not. You’re missing all of that information. You’re walking around as if you had blinders on your eyes. What’s the point of being a social animal if you’re not observing? If you’re not seeing this language of nonverbal communication, you’re continually misreading people. You think that smile that they give me is they like your project or your idea, they like you but in fact, they don’t, and you’re missing that. It’s not that difficult to learn how to develop the skill.

The other element of it is that being self-absorbed is depressing. You’re always wrapped up in your own problems and it becomes a sinkhole that you go deeper and deeper into. Being able to observe people is like therapy. You get outside yourself, your little problems, world, obsessions, and you involve yourself more deeply with other people. You won’t feel as depressed as you were. Also, you’ll find that people are quite interesting. A lot of the reason that you’re not paying attention is you think that you are more interesting than other people. Your thoughts and desires are more important than others, but if you reverse this and you start becoming a better observer in life, a little light bulb will go on in your head and you’ll go, “That person who works at Starbucks and serves me coffee every day, they’re much more interesting than I think they are.”

They have an inner life, weirdness, dreams that are strange. They’re doing things on the side that are interesting. People are interesting. They’re like characters in a book or a movie and that’s how I want you to think about it. We go to movies because we were voyeurs and we get to go inside the lives of other people and go, “What is that person thinking that’s an interesting character? Is he a psycho killer or not?” We’re fascinated. Think of the people you deal with like characters in a movie. They might be a psycho killer for all you know, or they might not be but they’re interesting.

Getting outside yourself will make you a better person, feel happier, and will make your life easier. It will also contribute greatly to your creative skills because the ability to get outside of yourself and inside of other people loosens the mind up. You no longer have all of your preconceptions about, “This person is good. This person is bad.” You learn to relax and be in the moment and go, “I’m not going to judge this guy that I’m talking to. Instead, I’m going to listen.” It has an overall effect I talked about in Mastery. people who are socially aware are often more creative. They don’t have these rigid mental categories. I could go on and on, but the benefits of becoming a better observer in life are in new infinite.

I’d like to end with this last point, which you weren’t aware of. We’ve focused the show and guests and interviews and topics around the idea of entrepreneurship, as well as the environment of capitalism. The reason why I was adamant to have you on is that for me, at least, you have success and failure in business, as well as in society due to your understanding of relationships as far as what I have experienced. With what you’ve observed with the entrepreneur, startup, business world, and the success and failure there, how do you see your bookmaking an impact and those who either are in the process of running a business, starting a business, or bringing on partners? What do you see as the impact of your book on the success of ventures in general? 

It should have a huge impact. I could go through the laws. Law number one should make you more aware of how emotions govern your decision so you can become more rational and make better decisions. The laws about how to judge people, how to judge their character, I have this chapter that will mean you won’t hire exactly the wrong person to partner with. You can’t believe how many times people hire the wrong person to be their partner and the misery that causes. This goes back to the Bible. It’s much ingrained in human nature. You will start making bad choices. I have an important chapter on grandiosity, and this is a problem that affects entrepreneurs. I know because I worked for one. I was on the board of directors of a publicly-traded company and the CEO was a classic entrepreneur who started from scratch. He’s charismatic and brilliant, but he wouldn’t listen to other people.

He thought he knew he had all the answers himself. He was a bit of a narcissist and it ended up that inability, that idea that your God, that you can do anything is what destroyed him. It’s a little bit of the complex than Elon Musk has. This chapter will make you realize that success is the worst thing that can happen to you in many ways. It makes you think you have the golden touch and makes you think that luck wasn’t involved, that other people didn’t help you, that you’re some God-figure that can snap your fingers and get whatever you want. It’s an illusion. It’ll help that way. I have a chapter on the authority. I maintained that humans respond to a certain primal type of authority figure. It almost goes back to chimpanzees. It’s rooted in who we are.

Nothing is good or bad. It’s human nature. Share on X

I layout for you the paradigm for the 21st century of how we relate with authority figures and what we will consider a powerful person who has traits. This is a person who is empathetic, believe it or not, that cares deeply about the employees, that involve them creatively, that leads from the front, that leads by examples, not expecting people to do the work that he or she is not willing to do. That is the person that has a vision. Having a vision is essential to being a leader. You can have a vision like Elon Musk and not be able to execute it and that’s another problem. A lot of leaders in the world with quarterly reports and all the pressures we feel in the stock market are a pure, publicly-traded company that is only reacting to things that happen month by month.

A true leader, and what people want and desperately needed in a leader, is the ability to see 1, 2 years down the road, to have an overall vision for where the company is headed. I preach this over and over again to that entrepreneur that I talked to you about, “Where’s the company headed? What is a brand? This brand has to adapt because tastes have changed from a few years ago.” They never listened to me and then the ship went down. I’m not saying, “I would have saved this, the sinking ship, but it was a key element.” All the chapters are important, but another chapter deals with knowing the zeitgeist, knowing the spirit of the times so that your idea, your startup, think of the times that we live in.

It’s a way that’s cresting and then falling. A lot of people are riding that wave or they’re behind it a little bit, and then they fall back. You want to be ahead of that wave and where the times are. You want to be 5, 6 months to a year ahead of where people are going. That’s a genius level. That’s true vision. You create something like Steve Jobs created the iPod that revolutionizes the tech world, because you’re thinking 1, 2 years ahead down the line. I have a chapter on how to read the zeitgeist to understand the spirit of the times. I could go through all the chapters, but to an entrepreneur, that should be a big juicy steak for them.

TWS 57 | Laws Of Human Nature

Laws Of Human Nature: Building better relationships is essential to surviving in the world today and to be more successful in your career.

 

Robert, this has been incredible and thank you for your valuable time. I loved it. I can see how much you enjoy having these conversations. I want you to enjoy writing and talking about things that make a difference. I’m excited for our readers to read the book, but can you maybe give out ways in which they can also follow you to be aware of other things that you’re working on? If you’re active on social media, what’s the best way?

I have a website. It’s PowerSeductionAndWar.com. The titles of my first three books, 48 Laws, The Art of Seduction, Strategies of War are there. I have links to the book that I did with 50 Cent. I co-wrote a book with 50 Cent and to Mastery, my new book, and then to my Twitter and Instagram accounts. That’s probably the best resource. There’s also a link for if you need and want to try and email me as well.

Robert, thank you again for your time. I hope to talk to you some other time.

I would love to, Patrick, whenever you want to. I enjoyed it.

Thank you, Robert. Have a good one.

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About Robert Greene

TWS 04 | Laws Of Human NatureRobert Greene is the author of the New York Times bestsellers The 48 Laws of Power, The Art of Seduction, The 33 Strategies of War, The 50th Law, and Mastery.

In his sixth book, The Laws of Human Nature, he turns to the most important subject of all – understanding people’s drives and motivations, even when they are unconscious of them themselves.

 

 

 

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Wealth And Human Behavior

The Pursuit Of Wealth And Human Behavior

August 20, 2020 Patrick Donohoe Podcast 00:28:30 Comments Off on The Pursuit Of Wealth And Human Behavior

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How you see wealth affects how wealth arrives at you. At its core, it is the human behavior that drives the kind of wealth we will have. In this episode, Patrick Donohoe talks about why wealth is in direct proportion to your human behavior. He discusses the importance of identifying your reasons for pursuing wealth, taking us into the results, the purpose, and the action plan. At the end of the day, everything is about how we understand ourselves. Follow Patrick as he explores the ways we manifest ourselves into the wealth we’re seeking after.

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The Pursuit Of Wealth And Human Behavior

Thank you for reading this episode. I’m grateful that you’re here. I hope you have enjoyed the last couple of shows. I’m excited to share it. There’s a lot on my mind and I feel it would be beneficial and helpful to you, readers. I’m going to get into my topic. My topic is, I would say a summary of a lot of the episodes that have been done and it speaks to the individual regardless of what stage of life you’re in. The topic is how your wealth is in direct proportion to your understanding of human behavior, starting with your own? I look at the pursuit of wealth and the reasons and purpose behind it, the actual results that are desired. Oftentimes it’s narrow, especially for me and the pursuits I’ve had in life.

The reason why I say that is an understanding of what it is you’re after first is paramount. What you’re after is a status or signaling, meaning you want to achieve wealth because of how it makes you look or how it positions you in the pecking order of the hierarchical order. I feel sometimes that’s a good igniter potentially at the same time, it’s not a lasting igniter and I’ll give you an example. I’ve had the opportunity and fortunate to have met, consulted, and advised hundreds from thousands of people. In conversations with a client of mine, he is successful in business. Investing incredibly well for himself and that was not necessarily the result that he wanted, but he didn’t realize that until it was too late. He achieved so much more than his parents and siblings. He got to a point where he had wealth that would last beyond his lifetime and his kids’ lifetime, but he lost his marriage and relationship with his kids. There was a huge concentration on achieving a financial and wealth outcome, concentrate on financial wealth. It was not until the end where he realized that the results he wanted were to have his money, provide a certain lifestyle, and experience with his family. It’s important to understand the results upfront. I feel that there’s always a drive behind what we’re after and identifying what that is will help us to better prepare.

The results are important first. The purpose of the results is second. Third, it’s the action plan behind it. Human behavior, as you can see, it’s the understanding starts with understanding yourself, being self-aware. I look at the lifestyle that we all get to live in the United States in this day and age and comparatively speaking to those that lived 200, 300, 400 years ago, we’re celebrating the 400th anniversary of the Mayflower landing on Plymouth Rock and the lifestyle that those individuals led are incomprehensible to us. If you’ll understand the history there they had an incredibly rough time coming across the ocean, as well as surviving in those first few months, the majority of the party died. I look at the lifestyle we live now and how things are progressing. We are fortunate. We have the technology, sustenance that continues to be cheaper and cheaper, communication, experiences, movies, entertainment that’s endless, and yet a lot of people are not satisfied. They want more and I include myself in that. The reason why I wanted to do this show is it helps me articulate and create some accountability for myself by understanding what I want.

Pursuing comfort will end up making us uncomfortable because it's in the uncomfortable situations that we grow and find meaning. Share on X

Understanding the result that’s what I want. Is it signaling and status, or is it truly to live a lifestyle that is fulfilling and meaning? I get to number one, understanding of human behavior, your own, but then understanding human behavior, the others’ behavior. What makes them tick? Why did they act? I feel there are a couple of examples that are timely. Number one, it’s, what’s going on with the quarantine, with COVID, the divisiveness of our culture, politics, I would say also it’s demographic divisiveness, the young versus the old that’s going to grow as well potentially. I look at what’s being done to combat this and I’ll first talk about the government and their intervention into human behavior. Based on the quarantine, the shutdown, people not able to go to work, there was a Band-Aid of unemployment benefits and stimulus. I believe that Band-Aid stifled what I feel is one of the most incredible aspects of human behavior, which is figuring out solutions during difficult times, but when a safety net exists, that safety net prevents that innovation and growth. Although I understand why the government did what they did, I also understand that human behavior where we shine as a human was prevented and we’re not going to understand the opportunity costs of that.

At the same time, I look at the unintended consequences of keeping people at home and specifically the unemployment benefits that were spread almost equally throughout the entire country that gave some people more than they needed, some people less than they needed. Also, what it did is it provided a choice and the choice was to either accept those benefits and not go to work, or to not accept those benefits and to continue working. Those that had opportunities to continue to work did not in many cases. There was a financial incentive to not work and that is also something that is paradoxical where our natural tendency does not experience difficulty, challenge, hardship, and pursuing comfort. At the same time, pursuing comfort will end up making us uncomfortable because it’s in the uncomfortable situations that we grow and find meaning. It’s interesting to see what’s going on in markets and with employment. I look at the unintended consequence associated with a stimulus with unemployment benefits is companies are figuring out how to operate more efficiently. You have companies that are operating remotely now. I know Facebook announced that they will have 100% remote employment until the summer of 2021. Google, Twitter, and a lot of other companies are doing the same thing.

There are also companies that I would say do not have deep pockets like those tech companies that are understanding that they can operate, be more profitable without office space or less office space, as well as not hiring back. Employment is coming back. There was a jobs report that almost two million jobs were added back, so unemployment is at 10%. At the same time that is a healthy number. There are businesses that are gone for good. Looking at what’s to come, we don’t know, but I would say what gives you signals? What gives you signs? The identification of opportunity is by understanding human behavior, understanding what people are going to do. I look at the understanding of this, markets, freedom, and independence but my understanding is not the same as others. Looking at what’s going on with regards to divisiveness, I see capitalism being demonized. I understand why, at the same time I look at when it comes to those that have, and those that don’t have. There is an overwhelming influence to punish those that have, and to reward those that don’t have to create equality. Equality is not based on equal opportunities. Equality is based on outputs, and that is extremely unfair. Equality of input, I understand. Equality of output, that is where it goes sideways because in the end, financial wealth is a function of results and value if done honestly and ethically.

TWS 56 | Wealth And Human Behavior

Wealth And Human Behavior: One of the most incredible aspects of human behavior is figuring out solutions during difficult times, but when a safety net exists, that safety net prevents that innovation and growth.

 

All people are wired differently and some are motivated to do a lot of work. Some are brilliant and can work in teams. Others don’t do and therefore people want equality of output based on inequality of input. That’s destructive and harmful to a growing and innovative economy. If you want more information on that, you can go and read the episode I did, it was 2018, maybe 2019 about capitalism. I understand there’s a definition difference with people not understanding necessarily what capitalism truly means. They confuse it with other ideas but I look at now there’s a war going on. Those that understand the principle and the true nature of what a capitalist society brings are their voices is being drowned out and that’s unfortunate. At the same time, I’m hoping that it provides an opportunity through disruption for those too to understand at a different level. The youth now have that opportunity. It’s going to be interesting to see how things play out. The last thing I want to talk about is when you understand human behavior, when you understand how people respond to certain events and activities, what it does, it puts you in the position of opportunity.

Number one, it’s the opportunity to provide value to serve, to help. It’s the opportunity to purchase assets at discounts and make a profit. It’s an opportunity to start a business and merge with another business because in the end, all human beings have their short-sightedness and they make mistakes. During times of massive disruption, that’s more prevalent. I look at something that is important to me, which is trying to figure out what’s going to happen in the future. What are the likely outcomes so that I can understand what to do? On the video, you can see that Wayne Gretzky is above my right shoulder. I have that up there not for the reason I’m going to explain but I had that up there because Wayne Gretzky was an average build, speed, strength, yet he understood his environment better than anyone, and that’s what made him good. That’s a whole other episode, but he has a statement that is glib and over and used all the time, which is, “It’s not about where the puck is. It’s where the puck is going.” If you understand human behavior, you’re going to be able to identify where things are going and with regard to jobs, employment, and in college.

This is on my mind a lot because my kids are at home. I’m sympathetic to all of you out there. They’re trying to navigate kids being home, even more, their education, the experience they have keeping them occupied and productive. There are many distractions and I know it’s a full-time job to keep kids on point. I did a webinar with a good friend of mine, Tom Wheelwright. Tom and I talked about the drive parents have to provide for their kid’s futures. I look at the love and care I have for my children and also kids that are not my children, whether it’s good friends of mine, my niece and nephews. I have one niece and everyone else’s nephew, although those are boys. The care and love I have for them and their wellbeing instinctively makes me want to provide for them. Give them what they need, whether it’s shelter, gifts, or an awesome birthday or Christmas experience. On one part, I understand where that motivation comes from I feel I am putting my kids in a worse situation because they don’t experience much scarcity. They experience a lot of abundances. That’s the case with most children these days.

Life is not linear. It is volatile, and the volatility and the challenge allow people to rise to the occasion and figure their life out. Share on X

The reason why I’m saying that is with regards to wanting what’s best for our kids, education-wise, we are following a cognitive bias of status quo. It’s what society says is the right thing to do. It’s what everybody else is doing. I look at our pursuit of education for our kids and this education continues to be less valuable, relevant and is essentially going to set our kids up for more unlearning in the future than learning. This is what I’ll end with and this comes to human behavior. If you know where the puck is going, what people trend too, and what they try to do collectively, then hopefully this will resonate. I’ll make that statement first, which is if you think about 400 years ago, the Mayflower landing on Plymouth Rock until now, all innovation and human behavior have been to the hierarchy of needs that I’ve spoken about in numerous episodes. It’s to figure out a way to provide for the most efficient way possible, food, shelter, clothing, your physiological needs, and that I would say, the expense as far as physiological needs are nil. You go to safety, providing a safe environment then you go to relationships. Look at the social media movement and how much people thrive on understanding the lives of someone else and how driven they are to spend enormous amounts of money and time being involved with other people’s lives, even strangers through social media and where that has gone.

The next level of the hierarchy of needs is the self-interest or ego, self-important, self-awareness, there are a lot of different subcategories to that. This is also prevalent in social media where it is a platform, so people can feel important. That is a natural drive that we all have. All of these areas are continuing to get less expensive. The future as far as our sustenance and our safety, there’s innovation, there’s money, resource, mind, and ideas going into energy, transportation, computing power, and robotics. The list is endless, which is going to drive down the cost of sustenance. What this does is it puts human beings in the position of the careers, jobs that no longer exist in the future. As Tom and I were talking on this webinar, as I prepared for it and thought about it, I identified some areas of employment and industry that are timeless. The pursuit of these, especially by children, kids, is going to be infinitely more valuable than any formal education will provide. The first thing I talked about which is leadership, understanding how to work in teams, especially how to work with people that are strangers that may have a different cultural background. That’s huge. Being able to do that effectively allows the leverage and maximization of individual gifts, abilities, and talents so that they all come together like a puzzle, individual pieces.

It’s profound when a team works together when they have a leader that is able to motivate, empathize, and give vision to an objective. The second thing is sales and communication. Being able to communicate a point, being able to find what a person wants and give them what they want. I would think within sales and communication, copywriting, creative writing storytelling is some of those subsections. Marketing is a fascinating science and it applies to everything and we’ll apply it to everything. I’m almost done with the book by Brian Kurtz, who is a marketer that started out in the ’70s and is still marketing now. He has gone through all the different platforms and mediums of marketing, yet teaches in his book Overdeliver timeless principles of marketing that have not changed even though technology and platforms have. Computer programming, everything is driven by computers yet there is rarely meaningful education and understanding by those that teach in the formal education system. It’s improving. At the same time, computer programming does not require elementary school, middle school, high school, or college. There are six-figure positions, both from a consulting, freelancer, self-employed standpoint and the demand and need is growing yet, the amount of education that goes into it in the formal sense is it’s nowhere.

TWS 56 | Wealth And Human Behavior

Wealth And Human Behavior: It’s profound when a team works together, and they have a leader that is able to motivate, empathize, and give vision to an objective.

 

A computer program, it could be application development. It could be UX and UI design, User Experience, User Interface design, which is essentially how we experience technology. Computers are essentially running everything whether it’s a website, it’s hardware or its software, computer programming in the future. I’m even going to take some fundamental courses because computer programming has to do with thinking models and understanding how a sequence of steps and events relate to certain outcomes. It’s a fascinating science that I’m going to dive into a little bit. I also believe that within marketing, within computer programming is the understanding of how relationships are formed, both professional relationships and friendships. There is something worth researching, which is the 12 Levels of Intimacy. Ryan Deiss who’s the Founder of DigitalMarketer.com sold me on something and it hit me smack dab in the middle of my forehead and it’s the 12 Levels of Intimacy. He didn’t come up with this. This is by someone that has long passed, but it talks about the steps and stages a relationship must go to, or else it’s considered harassment or assault if you skip steps.

Many people skip steps in relationship building. The 12 Levels of Intimacy is profound and it’s helped me to understand the relationship with my wife, better relationship with my children, and strangers, where relationships have to go through steps. If they don’t, then it’s considered a turnoff. It could even be harassment or assault. It’s fascinating to understand how people experience relationships in that degree of psychology. The final thing that I’ll say is social media. Social media is here to stay. It’s a part of business and relationship building. Although there is a lot of evil and bad things that happen on social media, there’s a lot of good that’s created. That is going to continue to be flushed out. Typically, the principle is what ends up being the equilibrium. At the same time, it’s going to oscillate back and forth into the evil, bad, to the good and profound but social media is part of the business. Branding, relationship building is here to stay yet it’s not taught in schools. It’s not taught in the formal sense. My charge to you through all of this is understanding human behavior at a different level is in direct proportion to the amount of wealth you’re going to have. It’s not financial wealth. It’s also your experience of life. We live in a blessed time. At the same time, we are experiencing challenges that have never been experienced in the past.

This is how life is where it is not linear. It is volatile and the volatility and the challenge allow people to rise to the occasion and figure their life out, figure problems out. I look at, what I’ve studied, what I’m intrigued by, what I’m fascinated by is our experience of life and what we wake up and do every day. How are our habits formed? How are our passions created? How did we start to identify what fulfills us and makes us happy? This is the last thing I’ll say and even though I say this, I’d be lying to say that I practice this all the time. It’s difficult to practice, but there are three degrees of relationship. The first degree is a selfish relationship. The second is horse-trading or exchange base. That means that you’re in a relationship as long as somebody gives you what you want, you’re willing to give them what they want.

The key to the ultimate fulfillment is being able to be motivated all the time by blessing the life of somebody else. Share on X

The final, I would say the more enlightened level is unselfish. The others’ needs are your needs, but they come first. This is the key to the ultimate fulfillment, being able to be motivated all the time by blessing the life of somebody else, whether it’s a spouse, partner, friend, child or colleague where you put others’ interests before your own and try to serve them at the highest level possible. That ultimately seems counterintuitive, at the same time service always brings more fulfillment than self-service. It is the ultimate self-service if you think about it. Thanks for letting me riff. I appreciate it. I hope you learned something. It helped me to express myself and understand what I’ve been reading and thinking about. I appreciate those that have read and I would love to hear your feedback. Hit me up on social media, email at Hello@TheWealthStandard.com. I’d love to hear from you. Continue to have a positive mindset. Look for opportunities to find ways in which you can help others. I know it’s going to improve your overall wealth, success, fulfillment, and happiness. That’s it. We’ll see you. Take care.

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TWS 55 | Leverage And Wealth

Leverage: Bringing Wealth To Your Personal Life, Investments And Business

August 6, 2020 Patrick Donohoe Podcast 00:30:58 Comments Off on Leverage: Bringing Wealth To Your Personal Life, Investments And Business

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TWS 55 | Leverage And Wealth

 

What is leverage and why is it the secret to becoming wealthy? We hear that word very often in business, especially when talking about credit, but what we may not realize is that leverage refers to far more than just that. Patrick Donohoe takes a closer look at what leverage means to your personal life, investments and business. Learn why leverage is important for you to succeed in all three areas, how it is differently applied in each and how it is essentially the same core principle as a whole. Whether you’re looking to increase your investment portfolio, scale your business or simply live a fulfilling life, there is so much you can take away from this episode.

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Leverage: Bringing Wealth To Your Personal Life, Investments And Business

Thank you for tuning in. I am going to be covering a topic that’s been on my mind quite a bit. It is the topic of leverage and how leverage is the secret to becoming wealthy. I’m going to cover three areas of leverage. Personal leverage, investment leverage, and business leverage. I hope you enjoy it. Thank you for your support. I hope you are doing well, finding opportunities, finding areas of your life that you’re happy about, and given the circumstances, are doing awesome. I wish that upon you. I have this new shirt Be Infinite. It is by my friend, Ken McElroy. If you like the shirt and design, it’s a great conversation starter. You can go to his website at KenMcElroy.com. You can also get a link that is in the resources section of the website, TheWealthStandard.com, and pick up your shirt. First, I’m going to riff quite a bit here. I have a couple of bullet points, but that’s it.

As I’ve had a lot of time, I take a walk every day. Typically, around midday around the city because there’s nobody here. I walk with my wife at night. It’s allowed me to think differently and think about some things. I don’t know if I would have otherwise had them cross my mind. A lot of it is because of podcasts and books. There’s lots of stuff that I’m trying to consume that inspire me and help me make progress in my life. The thing is, I look at the life that most people live and then I compare it to the billionaires of the world, whether it’s Jeff Bezos or Warren Buffett. Ninety-percent of the life they live in is the same life we live in. Let me explain that. They don’t get special movies, music, or average entertainment. They watch the same movies. They listen to the same music. They have the same web browser and relatively inexpensive software at their disposal.

Oftentimes, we put ourselves outside of the realm of that caliber of person and especially as it’s measured in dollars, wealth, financial and economic wealth. We think our lives are different and they’re not. I look at an example. I heard where a wealthy person could drive a Ferrari or a Bugatti, at the same time, it’s impractical transportation. All that it is, it’s a signal of a person’s or it’s a representation of a person’s wealth that they want to wear on their sleeve. I look at the average car, a Ford F-150, Toyota, or a Honda Pilot, and the actual technology, comfort, and the economy of it are superior if you think about it from a practical standpoint to someone who’s wealthy.

In the end, I often think about, “What do I want? What lifestyle do I want to live in? What would make me happy?” I connected from a financial standpoint, those that do not have wealth, those that do not have money, it’s difficult to find happiness, even though it’s not impossible. I believe financial wealth is a big piece of it. From there on, it’s how much and why? That’s where it comes down to a definition of what type of lifestyle you want to live. For me, I’ve recognized in my life and I’m no different than anybody else that what I want is I want to have a feeling of financial wealth to the point where I don’t worry about money. I also pursue having energy, being fit, and being able to not have to worry about my body or feel something that detracts from physical experience.

Also, relationships and family, my children, wife, brothers, parents, and friends. Those relationships bring me tremendous happiness and fulfillment. When I focus on it and have the distractions of money and the distractions of pain or the lack of energy, they’re gone. I got to that point. As I look at the audience and I’ve thought through, what would be most valuable to you? That’s where I broke down, how to obtain leverage in your life to achieve financial wealth and in hopes that you too start to have the distractions associated, what gives life meaning removed? Let me get into it.

Personal Leverage

Personal leverage, I brought up on the show before and he’s been a guest, Craig Ballantyne. He has one of the simplest things to follow when it comes to organization. One thing I see with working with clients and talking with people is there is a significant amount of disorganization, whether it’s financial things, budget, income, and expenses, but also how a person structures their day, week, month, year, and overall, their life. There’s a day by day mentality. I believe that there are some things in your life that you can systematize. What that does is it allows you to retain the energy and time to be spent in the areas that make the biggest difference.

A big piece of personal leverage is to have your life organized. What I mean by that is to streamline systematize what you repetitively do. Craig Ballantyne, as I mentioned, The Perfect Day Formula. You can check out his program, read his book. It’s insanely inexpensive, especially relative to what it gives you. Having a structure for your day where you understand the priority and what’s to be accomplished when that is done, you don’t have to spend energy anticipating or energy, trying to figure things out it’s done for you.

There are some things in your life that you can systematize so that you can spend more energy and time in the areas that make the biggest difference. Share on X

You set up days in a certain way where you’re organized and that organization becomes a structure in order for you to become more creative. That’s a big piece of what I see as personal leverage is being able to be in a creative space. Craig calls it magic time but being able to be in the most creative space because that is where all the money, all the wealth is usually created. It’s not created in the monotony. Monotony is something that human nature tries to systematize through technology innovation. That’s what we see all around us as far as the life we get to partake in and what I explained in the beginning as our lives, not being much different than the life of a billionaire because of the technologies, we are all able to enjoy regardless of status.

There are financial things, but the difference between someone that makes $100,000 a year and someone that makes $100 million a year, that’s what I’m referring to is what we partake of maybe at a lower level, is oddly similar to what the billionaire is able to enjoy. They may be able to have maybe a nicer home. Some don’t. They have an average home. Warren Buffett an average home and average car. They may travel a little bit differently, but for the most part, 90% of what we have access to is the exact same thing they have access to. It’s interesting to think about it from that standpoint, but what I’m referring to is, as you start to remove the monotony and the systems from your life, it puts you in this creative zone.

I believe all people are unique. All people have unique gifts. They have something to bring to the world but most people never discover it. I look at the level to get to when it comes to having your life and some of your financial matters organized. To get to the next level is leveraging those systems, the monotony, and the repetitiveness of your life. Systematizing that so that you can have more time, energy, and focus on the creative areas of life. Those creative areas I’ll get to those when I get into the business side of how to have leveraged both as someone who runs a business, but also someone that is a part of a business.

Hopefully, that makes sense for you. I’ll put a few more things here in regards to the personal side of things. Being strategic and being intentional about what you’re using social media for. I specifically do not use social media for social things. I use social media as a massive brainstorming mastermind group. I use it to be inspired, get ideas, see what people are reading, what they’re listening to, and for business purposes as well. You can strategically design it for that purpose. However, the lack of strategy is monotony. It’s the chaos and it takes a lot of time and energy away from you. Structuring social media is huge.

I would also say, taking advantage of the different software and different apps that are out there. People are using apps more for entertainment, not for productivity. When I look at productivity, there are many different ways in which you can use technology to ensure that your day is structured and you are anticipating or prepared the day before so that you optimize every single day, which will stack and allow you way more to be creative. From that creativity, you’re going to discover opportunities. Let me get into maybe a couple more things. Personal leverage relates to the direction our society is going when it comes to work.

My team, other than me, I come into this massive 20,000-square foot office and nobody is here but one person. My lease ends next year and we’re changing. There has been so much efficiency created in being able to operate remotely. We had a lot of the systems already. It was slightly different at the same time we’ve been able to cut expenses. We have a lot more productivity and we have a lot more happiness from the team. Where I’m going is going to be different than what I had anticipated. I believe a lot of the world is going in that direction.

The Wall Street Journal, there was a headline that said Google is essentially having their team and employees work remotely until the summer of 2021. I know it’s working for a lot of people. It may not be working for the company or business that you’re a part of. What this does is it presents an opportunity. From a leverage standpoint, when you look at a profession and how you’re earning income, what you’re doing, what you’re training is, your specialties, skillset, degrees, your experience, there are remote jobs. There are remote positions that allow you to live in an area. I love Utah. I grew up on the East Coasts. I liked the East Coast. I’m missing it because it’s the summer on Cape Cod where my parents live. I know it’s amazingly beautiful there, but it’s amazingly beautiful in the mountains the hiking. I sat there on my porch and like, “This is such a beautiful place.”

TWS 55 | Leverage And Wealth

Leverage And Wealth: As you start to remove the monotony from your life, it puts you in a creative zone.

 

If you don’t live in a place that you think is beautiful, that’s one thing. Your environment has an oddly interesting influence on your level of happiness and fulfillment, which is what I’m pointing toward is how to get there quicker. It’s leveraging that skillset to be able to work in an area and environment that is conducive to what you want. If you’re working or you have that position, it doesn’t mean that you have to pick a place and risk it and move there. You can try places out. That’s leverage. Leveraging what’s going on in the environment as far as professions and the workplace is concerned and where businesses are going. Be able to operate your life, income, and profession from a place that you enjoy the most. That’s another huge opportunity.

In general, which I dedicated a whole season but it is the idea of doing something that you like doing. If you’re working to earn money and a paycheck, I believe that drains energy and the output that you’re getting, which is your paycheck, is there’s a significant amount of input that goes into that. I look at the output from something that you love doing and enjoy doing and know that you’re making a difference. The input is much less than if it’s something that you do not like doing. Pay attention to that input and output, and what is going in. Not time, but also energy, happiness, and fulfillment. What goes to your profession, and then what you get out of it?

Think about it, what are some of the crazy professions that exist? You can be a YouTuber or a social media influencer. Nobody thought that would be a business. You also have video game people. You have professional video game leagues where people are on salary. It’s looking at all the different professions, all the jobs that exist out there. I believe that there’s something that aligns with who you are and what you like doing, as well as allows you to operate remotely so that you can be and live in a location that is conducive to an ideal lifestyle.

Investment Leverage

Let’s get to investment leverage because this is big. I look at our world and for those of you who went in and deep dove into the Richard Duncan interviews and try to understand Ray Dalio’s How The Economic Machine Works is starting to see how important debt is to our society? The expansion of debt is how we grow. The contraction of debt is how we go into recession and how asset prices go down? We can argue the morality and the principles of what is and what should be? At the same time, what is the debt-based system, and how we purchase assets? How we use leverage to do that is vital. I’ll discuss both leverages from a financing standpoint and I’ll talk about leverage when it comes to employing other professionals with your money so that they all operate and you don’t have to do much for money to grow.

The first thing is real estate. There is this belief out there that is perpetuated by some of the financial celebrities of getting out of debt. I believe that your lifestyle from a debt standpoint should not be leveraged. Lifestyle is something that doesn’t produce additional cashflow but there are assets that do. If there are assets that produce cashflow, this is when financial leverage helps to increase cashflow, but decreases your input specifically. What I mean by that is, you could buy an investment property, rental property. There are always times to do it. You have to be particular, choosy, but going in and buying a property in cash.

There isn’t a tremendous amount of leverage. There is no financial leverage there. When you provide financial leverage, let’s say it’s $100,000 property, and you have $100,000 in cash. Putting $100,000 and buying one property, and let’s say your net rental income is $500. Doing that, you essentially have a $6,000 net return every single year, a 6% return cashflow, or you can incorporate bank leverage. That’s what interesting is that banks don’t lend on many assets, but they do lend on real estate assets. If you bought a rental property for $100,000 and you have $100,000 in cash and you chose to get a $50,000 mortgage, maybe a couple $100 in payments, but you’re able to obtain two properties with $100,000 in cash that you have.

That’s the thing when you use that leverage, what you do is double the asset value. You also increase cashflow beyond what that $500 is. It may be more after you factor in the mortgage payments. What you also do is align your investment choice with where the economy is going and how monetary policy impacts the prices of assets. When you look at debt as the Federal Reserve Central Banks increase debt, increase the amount of leverage in society, it’s going to push all prices up, and that’s known as inflation. When you have a $50,000 mortgage, the value, the purchasing power of $50,000 is not going to be the same in the future, if that is the trend, as far as where the government is going. The $50,000 you’d pay that down in payments, but also the value of that $50,000 will be 2%, 3%, 4% less because of inflation.

Good business rhythm frees up energy and time for you and your team to operate in a zone of creativity. Share on X

Additionally, the asset of a piece of real estate will go up in value. I did a little mini-course about real estate investment. What it does is it explains, and it shows the financial numbers and details of buying a house in cash and then buying a house with leverage. You can see the difference and see how it plays out over the course of time. That’s financial leverage. When it comes to investments, I’ve owned lots of rental properties for many years. I’ve been a landlord. I’ve had my wife be a landlord. We’ve had property management, which means you have to be the manager of the manager. There comes, I would say the ability to employ those that have syndication, those that are professionals have history and essentially, aggregate capital and go into much bigger deals.

Ken McElroy is someone that I’ve made quite a bit of investment in. He’s the one I mentioned on the show, as far as the shirt that I’m wearing. Kenny has a company called MC Companies and they have tens of thousands of units around the country. In order to get into those big apartment complexes, which are several tens of millions of dollars, they aggregate investor capital. By investing in those types of projects, I’m not a landlord. I don’t have to worry about property management. I don’t have to worry about the tenants. I am able to leverage the experience of someone that is way more knowledgeable of markets. Someone that’s more knowledgeable about values and that has played out well for me.

There are a lot of people that syndicate that raises money. They do not have a good reputation or experience. Sometimes it does go sideways. That’s where the importance of due diligence and understanding the person who is putting deals like that together is paramount. That’s a big responsibility on your part. At the same time, the effort that you put into that and as you start to understand the variables to make or break a business that will allow you to make one decision, and then you don’t have to essentially make decisions again, other than maybe do this deal or not do that deal. All of the backend work is taken care of. That’s another example of financial leverage. I’m going to summarize personal and financial leverage. The definition of leverage is doing more with the same or doing more with less. You’re able to have more progress and have a multidimensional aspect to the decisions that you make.

Business Leverage

The importance of doing that is you’re able to employ the minds, efforts, and experience of other people. As I talked about in the show about leadership, it gets into the business side of things, which is where we’re going. From a business standpoint, I’ve made a ton of errors in business more than I’ve ever admitted to the show. I’ve admitted a lot in the book that I wrote. Some of them are micro, tiny errors. I made some big errors, judgment in people, hiring the wrong people, holding onto people too long, as I said, tolerating behavior, and not wanting to confront difficult situations. It’s taught me some valuable lessons and there was a lot of pain. It was difficult at the moment at the same time it taught me that here’s what happened. Here’s why it was painful, and this is how to avoid that in the future and do something better.

I look at leadership principles, the creation of culture, being a part of a company or being a part of something that makes a difference, as well as its mission-driven, honesty, and integrity and the ethical factor is also vitally important. When you see that compromised, then that is something that you steer away from, whether that’s the head of a company or a boss. You want to pay attention to their principles. When you start to see unprincipled behavior in one aspect of their life, chances are it’s happening in the business, even though there may be some masking there. I look at the company and the business you choose to be a part of an understanding of their values and principles. If those align with your principles and values. That’s vital in order to have a healthy relationship.

What that does is it saves energy. It conserves energy allows energy to be focused in the best areas. If something’s going to happen to the company in the future, and you’ve spent all this time, all this effort there and eco sideways based off of something, that’s out of your control. You’ve got to go start over. It’s understanding that now so that you have a better perspective of how things are going to be in the future. Going back to the leadership idea, leadership is being able to operate as a team, a unit in order to achieve a certain end. Individual effort is one dimensional. There’s only one mind involved, but when you have two minds, you essentially have a third person or third entity if you will. You have 1, 2 people, and then the combination of two people into the collaboration exchange of ideas.

Being able to lead to operating in a team is something that we’re not taught? This is not something that schools teach. It’s something that I believe is necessary in the business world, whether you’re in management, you own, or you’re an entry-level employee. It is being able to hone in on the skills of what good leadership is and start to lead people, support, inspire, do good to them, and praise their work. There’s a number of ways to do it, but that’s a huge aspect of a business. I’ll go back to what I explained from a personal standpoint. In business, there are many things that are not systematized. They’re monotonous and repetitive, especially if you’re a business owner. If your employee time is spent there when either technology, a system or SOP, Standard Operating Procedures, what those do is it creates uniformity on the things that are mundane. It allows employees and people to operate in a more creative zone.

TWS 55 | Leverage And Wealth

Leverage And Wealth: We are a debt based system and how we purchase assets and how we use leverage to do that is vital.

 

It’s the establishment of systems and businesses that allow leverage. I would say technology and business are also paramount. I see far too often people operating their finances, operating their customers and leads on spreadsheets, and there are much waste and inefficiency with the energy that’s spent there. The reason why I’m explaining this as if you’re a business owner, establishing good business systems, business rhythm, and meeting rhythm. What that allows you to do is systematize the predictable. What that does is it frees up energy and time so that you can operate in a zone of creativity, which creates even more ideas. It aligns those ideas with what is even more valuable to customers and clients and provides them more value, which ultimately grows revenue, grows the business, etc.

Leveraging business too, I see as understanding individual strengths within a team, within a unit, and not having the same person in each of the roles on the team. It’s having different personalities, complementary roles based on whether it’s a personality, based on skillset, based on experience and natural abilities. That’s also vital. I look at a business owner and their responsibility to always obtain leverage, which is doing more with the same or less, but also, I would put the success of an employee and that might be you. You might be either role in the ability to identify points of leverage. When you’re able to identify ways in which something can be streamlined when you’re able to identify, how to do more with the same or do more with less, what that does is it starts to present opportunities.

You may be saying, “If I do that, they’re going to think I’m trying to take their job.” If those types of relationships or feelings exist in the business place, that’s a business that I would say does not align with the principles and values of a successful business. That puts that in question. Getting into bringing a good amount of energy, ideas, creativity to a business that’s where I’ll go back to the personal leverage. As you’re able to systematize your day, I look at people not being able to operate at full capacity for eight hours a day. I would estimate and I know there are studies that have been done here, where energy, focus, and commitment is maybe 4 or 5 hours a day at the most.

That’s where I look at being able to have personal leverage so that you have a structured and organized routine in your life so that you can have more energy and creativity zone. Being able to bring that to a business, allow you to make a difference. As you make a difference, you get more money both as a business owner and as a person that’s part of a business. The two are connected, the same principles of success apply. That comes to life in general. The opportunities for leverage are everywhere. If you can have that word at the top of your mind and have it as a lens that you slip over your eyes so that you can view your life, where you are, your business or the business that you operate in and find, leverage, find the ability to do more with the same or do more with less. I guarantee that those are the principles that are going to make you more money and put you in the position of achieving wealth and living an even more fulfilling life.

Thank you for tuning in. I hope you learned something, go out and create some value, go out and find some leverage. Head over to TheWealthStandard.com. There’s also our resources section that is stockfull of businesses, services, and programs that I’ve followed to create leverage in my life. I know that it would make a difference in yours. I hope you find those resources valuable. Thanks so much again. Thanks for the support. Head over to iTunes, if you feel compelled to provide a review that always helps. Thanks again. We’ll talk to you. See you.

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About the host

Patrick Donohoe

Patrick Donohoe

CEO Paradigm Life

Patrick is the President and CEO and started Paradigm Life in 2007 after learning from his mentor Kim Butler about financial strategies outside of Wall Street.

With a background in economics and marketing, Patrick immediately realized the opportunity to teach investors, business owners, professionals and families on a large scale using modern digital media and communication technology. Since 2007 Paradigm Life has worked with thousands of individuals in all 50 states.