Training The Next Generation With Aaron Chapman

TWS 10 | Training The Next Generation



Humans are creatures of habit, which is why from an early age, people need to be educated about which habits are good and which are potentially destructive. Training the next generation is really the best way to ensure that these habits, values, and motivations are instilled from an early age and not so easily discarded once they go into working environments. Aaron Chapman is a veteran of the finance industry working at SecurityNational Mortgage Company. Aaron speaks to Patrick Donohoe about when to instill these habits and the best ways to keep them ingrained. Is it time for you to learn some new habits?

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Training The Next Generation With Aaron Chapman

We’re going to dive deeper into residential real estate investing. My guest has been in the industry for quite a long time and has a different angle. We took the conversation in a direction that you will be definitely inspired by. My guest is Aaron Chapman. It was an in-person interview. The last couple had been in-person video type of interviews. Make sure you head over to our YouTube channel because those interviews and the video are housed there. Aaron Chapman is a veteran in the finance industry. He started in 1997. Since entering the finance industry, his clientele has ranged from purchasing their first home, building their dream home or investing in multiple properties for long-term cashflow. He considers his expertise complicated. He’s presently ranked in the top 10% of the 300 licensed loan originators in the United States, which is a huge feat. Aaron and his wife also take huge pride in a family business structure that they have developed. They openly discuss their assets, their reason for being, and their mission. They have created a system of accountability with their kids, which is unprecedented.

You will learn about that in the interview. The kids are very much engaged and also are able to participate. Aaron and his wife also retired from nine years of service with the Pinal County Sheriff’s Office Volunteer Rescue Unit. They both retired as team leaders. During that stint, they experience an excess of 50 rescues per year. In many cases, the missions received international media and local attention because they were able to preserve lives in extreme circumstances. This guy is amazing. You are going to be inspired by how he thinks and what he is motivated by. I can’t wait for you to meet him. Without further delay, please welcome my guest and my friend, Aaron Chapman.

Thank you for tuning into this episode. It’s going to be an awesome interview. You don’t know it yet, but you will soon know. Aaron, it is awesome to have you.

I was impressed with what I saw because we walked up to this place and like, “Are we going to that building?” We get in and it’s like, “This place is awesome.” You let me in, which is a good thing. People let me come in, hang out, meet your staff and see everybody here. You’ve got a cool operation. It’s a cool looking place.

I also tell you about my first impression of this building when we first moved in. There used to be a Mexican restaurant and a nightclub. I didn’t know. We came in on a Saturday night over the holidays. They had this runway out on the patio. There were girls in Santa Claus attire. That was my first impression of the building where the whole building was shaking and that was going on downstairs. My wife was with me too. That was a good experience.

Aaron, it’s serendipity because we’re focusing on investment, but a lot of the interviews have gravitated toward legacy, meaning and purpose. In the end, a lot of people are in this rat race in a sense of what they’re doing financially and don’t necessarily know what the end result is. They think it’s retirement. Other than that, most people don’t dig deep. You were going to be in town because the main company that you do business with is located in Salt Lake. It worked out that you’re going to be here. You’re going to be able to meet the entire team, come to the office, but also do this interview.

You’ve been writing a mini-book that is very inspiring. It revolves around legacy, purpose and meaning. I’m excited to interview you because all these events had to happen in order for you to be here. There’s definitely a design behind it. You’ve supported our business as an advocate working with Gary Pinkerton and I’ve learned a lot about you. You’ve spoken on the Cashflow Wealth Summit a couple of times. You’re a stand-up guy. You’re a man of principle and purpose. It’s awesome to know you.

Thank you. I appreciate that. The reasons that I can do those things is because of the stand-up people here at Paradigm, the stand-up person that Gary and you are, the principles and purpose that you operate your business with and your lives. I can walk beside those kinds of people. It’s difficult to live a life and you’re seeking purpose and significance, but the people around you are not or what they’re seeking is the wrong things. You can’t couple those things together. You can’t walk together. The reason it’s easy to be able to do what I do as far as supporting this organization and be able to point people to the knowledge that you guys exist is because of who you are.

Let’s dive into something I’ve done with all of the guests, which is be able to gain quickly their perspective of life, business and investment. It’s with a couple of rapid-fire questions. Pre-work, who was a role model to you, someone that you looked up to or inspired you?

It might sound cliche but it’s my parents. I always sought their acceptance of what it is that I did. They were very hardworking people. They would be all night long going. I say this about my mom, if she sleeps, she’s hanging upside down. That woman goes and goes. Even now at 72 years old, she’s still going. I grew up watching them work their guts out. We did some time in my high school years on the cattle ranch. We had a partnership with a cattle ranch. My dad and I were out there together a lot. We worked together in the mines in New Mexico before I came into this. One of the big things for me when I was working with them in the mines was to be able to experience that, and then for him to call me his partner underground to the general manager. I knew I’d made it to the goal where I wanted to be. Through my childhood, when he was mining and not when we were cattle ranching, because we were mining a lot of other times, we were referred to as a partner. That was a big deal to me who that person was. For me to be claimed that was a big thing for me. Working with my mother, she was in real estate, I was doing regular type of lending for home buyers. We worked together a lot. Having her willing to continue to offer my name to her clients because she won’t do that if you suck. If you don’t do your job, she has zero patience for you.

TWS 10 | Training The Next Generation

Training The Next Generation: A legacy is educating people enough to know where their end is and what tools they can use to achieve that end.


The nepotism idea is even more so.

It’s a reverse nepotism. She works her guts out. I didn’t. I had to continue to earn that position. That would be the people that I needed to work to continue to get that type of acknowledgment.

Second question, what superhero or icon in history did you most resonate with?

I’ve got to say the Hulk in a way because you could be a very calculated and thoughtful individual. He was a scientist and very brilliant mind in there, but then life happens. My business has been in one of the situations where no matter how hard I try and how much I did to go about a calculator process, there’s always somebody there to block you. There’s always something to hit you. There’s always something to try and knock you down. I found that I had this power internal part go back at it like a silver back on Coke and go after what I wanted because I knew it was right. I knew it was necessary to overcome those obstacles and be able to see what was on the other side.

It wasn’t where I went out in a crazy way like you have no control, but I can see how you finally have that internal fire that comes out. You are able to push through that obstacle. They’re not even obstacles anymore. What used to be like a huge difficulty I overcome because we have such momentum with me and my team that I don’t even feel those things. It feels like a little bump. It’s like a train of full board. When you need to go out there, it’s readily available to me. When you look at an actual historical icon, we’re sitting in Utah and you’ve got Porter Rockwell.

I remember reading books about him. He’s an individual who was a kind man. When the time came and when he needed to, there was no line even for a personal cross. He took care of business in a big way and I identified with the way he went about life. He did the right things. When things are off a little bit, he went at his way. That might even be a reason why I look the way that I do. I’m going about things my way. Even though I’m amongst groups, either it be religious or business, this is the individual you’re dealing with. I don’t give a crap what room I’m walking.

Carl Jung, the difference he’s made in psychology is identifying those four dominant archetypes: the warrior, the magician, the lover and the sovereign or the king/queen. From what I’ve studied, the ability to associate those archetypes of your personality at the right time equals an incredibly meaningful life because you’re not showing up as one all the time. You identify who those archetypes inside of your personality so that when you do show up, you make the biggest difference. Imagine showing up to a hard situation that requires a warrior, but you’re the lover. It doesn’t work so well. You may dent a few legs but you’re not going to get anywhere. What charitable causes do you support?

You mentioned the book and I have released four. We may even talk about those, but those four are out. We have yet to get the marketing behind them. Every penny that comes in through those books is going to go towards charities here. I’m working on supporting veterans housing, The Land Foundation who handles cerebral palsy, trying to get research done for children. There’s Operation Underground Railroad and we know what they do and what is necessary. That whole subject to me is something that turns my gut, but inspires me to think on ways to try and help.

Every cent is going to go to help those causes. That’s why we even have some of the systems we have built in place to help those who can’t help themselves, but we’ve screwed it up. This is the one thing that I get to control. I’m going to control the sales of those four books to go to those causes. I’m telling anybody who’s reading, I spent in excess of $20,000 to get those out. I’m asking you to spend $30 to $35 to support those foundations. I’ll support them with $20,000 plus. Please support it with your $35 to $40 to pick those up and work with me to get some resources into the right hands.

Finally, legacy, if there was one attribute that you could impress upon your kids, grandkids, the world, this audience, what would it be?

It would be to be able to direct your mind. That’s the one thing that I want everybody to be able to gather control over. You’re probably like me, I’m a big fan of Napoleon Hill and his book that was released in 2011, Outwitting The Devil talks about a person’s ability to control their thoughts and focus them where you have the most success. 98% of the people drift. They focused on nothing and accomplished nothing. People ask me about my business and why I focus almost solely on real estate investors, doing financing for real estate investors, buying those single-family duplex, triplex, fourplex homes. Why do I not target realtors? Why don’t I go after first time home buyers? I found when you tried to be everything to everyone, you’re nothing to no one. I focused and went after one specific type of client. I went from doing 100 transactions a year to 723. I’ve been consistently 700 for three years. One thing I will preach to everyone, if you can control your mind, control where you’re focusing your energy and not yanked at 100 different directions, you will be able to find the success you’re looking for.

New technologies continually make it easier to educate the next generation. Click To Tweet

I’m curious about what’s driving you because you’re an incredibly driven individual. The first question I had is how do you characterize legacy? You give me a preview of what your next book is going to look like when it comes to the legacy you want to leave for the world, for your family specifically. How do you characterize what legacy is?

People being able to pick up the pieces that are left when you exit and be able to continue on the exact same path. Not necessarily does it have to be 100% of the end result that you planned for, but the result that they planned for. For me is to educate my children enough about what I have done, what I’m intending to do and to understand and figure out what their intentions are. When I do leave this sphere and they have to pick up the ball from there, from what I leave, they can use that to continue to grow towards their end goal. A legacy is in reality educating people enough to know where their end is and knowing the tools that they’re left and how to use them to get to that end.

You alluded to something in the beginning, which is what I’ve found with most of the guests were their biggest influence was their parents. A lot of that development happens within the first ten years of life. If you look past to their parents and their parents are going back to generations, it’s amazing to see how one little thing can make a difference for future generations. I look at something that I’ve questioned myself in and often thought about, which is what am I after? What am I trying to achieve? Ultimately, I believed that the meaning that we get comes from us being able to make a difference. It starts in those inner circles and then works its way out. The inner circles are your kids and your spouse, then you go to your extended family, then your community. When you grab hold of what creates meaning for you, life starts to take off. It sounds like that’s been the case for you.

It is in a big way. You talk about inner circles, your inner circle evolves to an outer circle, which becomes your inner circle again. You have your parents and your siblings. Eventually you’re looking to expand that inner circle to an outer circle, which is a spouse. When I met Rizzo, I brought her into an inner circle and then we have kids and that create inner circle. We then have friends and business associates. You and I may have lived and stayed away, but there’s an inner circle forming there. Part of it is I’m looking for the acceptance of my family and continued acceptance of my spouse and acceptance of my kids. I wanted to be able to lay my head on the pillow at night and know that those people that are in that circle that’s ever-expanding have the best thoughts possible with me because of what my intentions are. My intentions are not for me, but my intentions are for them. If we continue on that path, everything we’re talking about achieving on the legacy side is easily achieved.

Talk more about what drove you to write the book that you’re writing around legacy and a system for the family. Where did that idea spark? Maybe it had to germinate along the way, but where did that come from?

I remember back in 2012 when I started typing. I wanted to give something to my kids. I wanted to leave something. They were all very young. It’s amazing what has happened in this window of time. I started hammering away on a tablet I had and I had one of those Samsung Galaxy 10.1 whatever they were. I found myself there all the time starting from childhood. What it boiled down to is I was trying to understand my kids. I don’t remember the circumstances. Something was going on there. I couldn’t get what was going on with them. Why are they not getting it?

I had to take myself backwards to that age. I stopped myself back at those early ages to try and put myself in a position to understand what were they thinking, why were they thinking it, how can I identify with them, and how can I communicate in a way that they would understand? From that initial thought of putting myself in a dormant state to think through that, I started writing. I started creating my entire life story up until 2015. It’s amazing, I got to nearly 400 8.5×11 pages and 9 or 10 is what the size of the script was. It was amazing how much data was there.

I’m like, “I’ve written all this, I need to put them in book form.” Somebody introduced me to an editor who was working for Tony Robbins for a number of years as his personal assistant. I put this in her hands. She read it. She says, “This is all great, but nobody gives a crap. Give them something that they care about first and they’ll care about this.” I’m like, “What do we do?” I paid to have this ghostwriter package done. I flew out to her location in Olympia, Washington. We sat at the Lake House for two days. It started out for the first six hours and it wasn’t working.

The information wasn’t flying, nothing was flying. I was telling them there was something happening here. We had to get into a deep conversation and start uncovering some things, then it started to flow. We spent the rest of that day and into the next day recording conversation after conversation. After a few months, they gave me the finished product. I read it and I’m like, “I can’t publish that. That’s not me.” They’re like, “What do you mean it’s not you? This is all your words.” “That’s my words, but it’s all edited. You took the stories and some of the meanings even change the way that you typed it up. It’s not the same meaning.”

I went back and what they do is awesome. It got me started. I started all over again, but now I had processes that I’ve gone through. I started typing. It hit me one day. I was talking to my brother-in-law. I was in the Admiral’s Club in Dallas. That’s where I got off a plane. He’s calling me and we’re talking. He goes, “I was thinking. You hit on a lot of topics. I hear you talking to different people and doing these podcasts. You need to start touching on specific topics and write on that.” I’m like, “You can’t do that. How am I going to do that? I can’t do a full book on that.” He’s like, “You don’t have to do a full book.”

TWS 10 | Training The Next Generation

Training The Next Generation: Today, accountability is not always built into the ways people operate, and kids are influenced by this lax environment.


It started occurring to me. I take all the content of a full book and break it into releasing it chapter by chapter as a small book like the dime novels of the 1800s. I started off with a book called Point Your Head and Heart…Your Ass Will Follow. It’s all about if you think it and you believe it and you write it down, you will show up there and it’s happened repetitively in my life. The second is a book called Gratitude: A Practical Application. It illustrates two separate contrasting events that created my understanding of gratitude as actual economy. This is not some agreement between me and God.

There’s no mystical piñata floating around that’s going to drop gratitude blessings on you because you walk around with gratitude. It is an economy between me and you. It’s very well illustrated between two different people I met in the same week. The second one is called Quit Jerkin Off. You can take that phrase however you want to and figure out your topic, but what it boils down to is habit that people are losing so much productivity to have and it gets back down to controlling your thoughts.

The final of those four is called Stihl Runnin. That’s about one of the icons of my life, my dad. Watching him with that Stihl chainsaw he had. It’s an O41 made in early 1960s in West Germany and how everybody else on the mountain would have problems with their chainsaw, but that kept running and it still does. It’s in my personal collection. It explains where I wear the hat. It’s a lot about controlling your mind. Back to that mental focus situation. We’re then going to go into book five, which is what we’re talking about now. I’m titling that book five, The Business of Family.

What it boils down to is I have been able to create a system within my family, having my kids being held accountable to what they’re putting aside for their future even at a very young age. Nobody ever held me accountable. They said save. That’s all they did. Nobody showed you how. Nobody taught you how. They told you, go and invest into a mutual fund or something. My children and I now on a fairly regular basis, we sit down. We go over the investments we’re going to do. We go over the family holdings. We also go over a log that they are putting aside 10% of their income for their future. They’re getting their own life insurance policy and we’re training them how to use it.

We’ve created an engine to be able to use our income with our life insurance policy to buy real estate investments and rotate it back through this engine of growth. I can illustrate to people how to do that within the book and also with other materials. It’s a matter of seeing the change that happened in my kid’s life. I’ve got to think like there are a lot of people frustrated with the next generation and this generation, but they’re not doing anything about it. I can’t things bitch about what’s going on with the generation and the following if I’m not doing any of these. I need to participate in doing it. The easiest way would be to start is with my own kids. Get them on a track and then after that everybody else. I can’t walk into people’s houses to get your kids over here or I can create some documents that they can use as a framework. I can partner with somebody like Paradigm Life to get that framework out. We can work together on technologies to continue to make it easier and easier to educate the next generation.

If you go to our generation, the generation before us and all the way back, the necessities and the physiological needs of life continue to get easier and cheaper and almost built-in. If you go to a lot of the generations in the past, the accountability of life was built in. If they didn’t prepare or organize, they died. Now, you don’t have to hunt. You don’t have to store food for the winter and ration during the winter. There are many conveniences now that the environment of accountability continues to decline. I look at my kids and even though their life seems easier from that physiological standpoint, it’s much harder because the previous generations had it easy. We had accountability built in. Now accountability is not built in. If you look at where kids are influenced, they’re influenced by their environment. It’s a very laxed environment. They think things happen in certain ways because they haven’t been taught and the older generation assume that they know and they don’t know.

I never even thought about. That is a very good point. If you did not do certain things, the outcome was swift and it was certain. It was right there in front of your face. Now everything has softened. It’s interesting to think that our children can survive easily. One of the things I’ve noticed and people are interesting creatures. They don’t realize that being able to survive is a skill that can easily translate to thrive. You see a guy who’s trying to dodge the tow truck that’s coming to get their car because they aren’t making the payments. It’s amazing how quickly they can come up with money to make those payments when they’re losing their transportation. If they have that type of energy and put that fuel into it to get to that point to pay all that stuff, why do they take the foot off the gas? You know the momentum it took to get there, can stay right there behind. They can take their foot off the gas, but if they keep the foot on to throttle a little bit, you can stay at a cruising altitude.

They wanted to take their foot off the gas and say, “I’ve got three more months before that guy shows up again.” It happens all the time. Many people in my immediate sphere, I’ve seen that happen too over and over again. Why don’t you keep going? What is the allure of your couch or your video games or whatever that is that stops you from having a much more comfortable existence? Nobody says you have to become a millionaire or billionaire or whatever. How about paying your bills?

That’s where I look at the habits that guy had were built in a long time ago. The influence that he had when it came to money, whether it was his parents or his environment, his social circle, his work circle, who knows. Right now, everybody has those habitual behaviors that they operate by. Very seldom it’s consciously controlled. It’s all unconsciously happening. You look at where the most influence happens, especially with kids, is in those early years is the first 10 to 15 years of life where they are impressed based on their environment.

Their environment is controlled usually by the parents. That’s where I look at the influence that I’ve had from my parents and my grandparents to my parents and my great grandparents to my grandparents. All of that has influenced how I show up for my kids. If I want things to change, I wasn’t necessarily happy with certain elements of how I grew up. I believe my parents did an amazing job. If I wanted things different, if I had one of the things even better, that was on me to create the environment in which that was going to happen.

Everyone has habitual behaviors they operate by that are seldom consciously controllable. Click To Tweet

The environment is interesting. If it’s not done dynamically, it could have unintended consequences. My wife grew up in the slums of Mexico in a cinderblock home, concrete floors, very humble circumstances. Her dream was to give her kids what she never had. I understand that motivation. At the same time, there are huge unintended consequences from that. It provides this environment where kids aren’t necessarily accountable or learn the principle of self-reliance. If we recognize the elements of what influences people then we can customize it to what values we want to layer on to them so that they have those unconscious behaviors going forward, not the ones where they’re fending for their life when the tow truck comes to take their car.

The tough part is giving all that information, boxing it all up for him, you’re teaching the best you can, but then you have to walk away and let them do it. I’ve also noticed in many families, you could have 4 or 5, 6 kids in the family and 1 or 2 of them do some amazing things. The other ones are completely different and they all grew up in the exact same environment because they accepted things differently. It’s so easy to see the negative, “Mom and dad did this stuff to us, but what about this over here? I never saw that.” “How is it that I saw it?” We were in the same room together. We were there the whole time together. We weren’t even separable, but yet somehow you saw only the negative.” That’s a difficult thing for us to wrap our head around our parents, also educators, business mentors and business people whatsoever and we’re leading our clients to do an end goal, to give them all the data they need and then do nothing with it and be able to accept that and not get frustrated. That’s tough.

Information and resources are more abundant than in any point in time in history. At the same time, the use of that information, the understanding of how to be resourceful and use that for a certain achievable end. That’s definitely lacking.

It made great data cheap as it is. I can get amazing stuff. It doesn’t become valuable until you use it. The second I put it to use, the second I put Napoleon Hill’s works to use, that can be extremely valuable. I heard about his stuff. I had a seventh grade English teacher write his quote, “What the mind of man conceived and believed, he can achieve.” In my yearbook in seventh grade, that still stands out. Your book is long gone but Mrs. Shumway writing that stood out. I’d never ever seen that phrase again until I read Napoleon Hill’s works in 2016. That’s when I first picked up his books in 2016 and I started reading that. It was 2015 or 2016 when I started picking up the book. The change that had happened to me from 2015 until now had more impact in that little time of getting that education and put it to work far greater than that time before as far as my business impact. You look at my last few years, I’m ranking the top twenty people in United States in my business.

There are 300,000 people in my industry. I’m in the top twenty for transactions closed. It all started in 2015. It all starts from educating yourself with the data that’s out there. My job is now to take the data I already know and refine it down into a way that people will hopefully listen. I’m trying to dumb it down a ton. There’s some high-level stuff out. There’s nothing new. I’m giving it from my perspective. I practiced it and used it. I saw the success of it in a very short window. Now I’m handing it off in little bite-sized chunks.

The information existed, you had all these different experiences of time as well as that quote in the yearbook. What brought it together? You read Think and Grow Rich, The Law of Success, and Outwitting the Devil. What was the connection? You were reading it. What did you become aware of that you weren’t aware of previously?

I started a partnership in 2015. You’d call him my competitor. He and I run an event. He started pushing me to come and merge our businesses. We did in 2015. In a need to contribute to the growth, we were on a trajectory. We’re going to accomplish some major things. When I made that happen, I was like, “There’s some huge potential here.” It wasn’t just me. This was somebody over here who I’ve had held in pretty high regard. He was getting it done. He saw enough in me to bring a board with his team. I have to step my game up. I was having some chicken wings with a buddy of mine at one of those little Irish pubs.

He had told me about the book, The Goal by Eliyahu Goldratt. I took that book and I started figuring between that and the system that I was already creating in my head. I called my Chipotle System, which is how we get loans done. It’s like going to Chipotle to get a burrito built. I started taking from The Goal things to be able to implement those manufacturing systems to finance, to building an intricate financial instrument for real estate investment. That’s where it started. It’s trying to contribute more to the whole. That partnership severed. He had decided that he didn’t want to continue and he walked and left me. In November 1st, 2015, I start over with nothing. Starting over with nothing, I had greater knowledge. The knowledge of, “This is possible. We could do this because we were doing it.” I saw that it was working for some reason, he didn’t. What he wasn’t seeing, I can’t speak to, but what I saw was a huge growth in a short window of time.

TWS 10 | Training The Next Generation

Training The Next Generation: If we recognize the elements that influence people, we can customize what values we want to layer on to them so that they have those unconscious behaviors going forward.


I implemented those things. I got to thinking at that point, I was like, “If I got all that at one book and all these people kept talking about this Napoleon Hill guy, maybe I should listen.” I cracked open one of his books and it started. I cracked Think and Grow Rich because that’s where you start. A buddy of mine told me about Joe Dispenza’s book, which is Breaking the Habit of Being Yourself. I cracked it open. I tell everybody about Joe Dispenza’s Tacoma TEDx. You’ve got to watch that Tacoma TEDx Talk about how that mind works and connects neurons. I saw those things.

Let me get into the next thing. I got into Outwitting The Devil. Somebody told me about that. I was telling about some of the books I was reading. I share with them Dispenza’s book. They go, “You should check out this book.” They shared with me Outwitting The Devil. I’ve never heard of that. I read that and that was eye-opening. I read it once and listened to it three times on Audible. The Audible version with the contracting voices is amazing. I went from there to The Wisdom of Success. It continued to domino. I start to discover the most influential book on me. It’s Charles Haanel’s book, The Master Key System.

In fact, I shared that you’re going to do this thing. That helped me train my mind properly. I get into scripture. Every morning I started getting up at 4:30. I’m still deep into the Old Testament. I’m reading it along with Skousen’s The Third Thousand Years. I started off with The First 2000 Years and I’m about twenty pages left of The Third Thousand Years and go into the next one. I’m now through the Exodus and all that, which is amazingly deep stuff. When you couple that with Skousen’s work, you can see how to handle people.

There’s a lot in there. Not to take this down a religious path, but when you start looking at the works that we’ve all talked about and you look at the work of the Bible, the book of Mormon and other scripture and all these things together, you start finding that there is no religion. This is the history of us. This is like my dad telling me what I need to do to be successful. This is the Creator of all things saying this is the stuff you’ve got to do to be successful and follow it. When you get it from people’s perspective like Hill, Spencer and Haanel, then you couple that with works that have been in existence forever, it’s all been there. Every single thing has been there.

The values associated with a meaningful life have been there for a long time. The principles that govern behavior have also been there for a long time.

You have stories on how to practically apply it. That’s the difference. We didn’t have practical application.

That’s where as we were talking about kids, practical application for you required signing a partnership. It put you in this position where, “I have to do this.” It’s no longer a choice. It’s, “I must do this.” When your partner left, it created an even more refined environment where it’s like, “I have to do this.” That environment can be controlled and designed intentionally. However, for most people that you have these epiphanies of life, it’s been done because of a car accident or a loved one passing away or having a near death experience, something like that.

I’ve had all those but for some reason, this was the most poignant.

It’s different for everybody where they come to this realization of, “If I don’t do this, the consequences are severe. The consequences are way more painful than the actual pain of changing.” That environment, going back to legacy, I’ve shifted how I influenced my kids. I’m intentional about the environment and intentional about what my motivations are, what my values are and the reason behind, sometimes things being difficult because in that difficulty is where your mind engages all the different resources of your life that you’ve learned, that you’ve read about. It gives you guidance on what action to take, which then refines your habits. That’s what it’s about.

Og Mandino wrote The Greatest Salesman In The World. He puts humans as creatures of habit. We all need to understand it. You’re going to be guided by some form of habit. Form good habits and become their slave. Tactics and strategies will continue to evolve with your environment. It’s the principles that remained the same. If you form the habits around principle and you have the right principles, everything starts to work for itself. People ask me, “How do you have the energies to have all these things done?” It’s because it all goes back to my basic principles. If it fits within that, I move forward. If it does not, I ignore it and move on what does.

What does this have to do with investment? That’s our theme for this. It has a lot to do with it. Most people may think, “You’re talking all this stuff, but what does that have to do with investing?”

The bottom line is the person has to decide that they want to invest. They’ll start building the principles around the investment vehicles that they’re choosing to do. They have to get the principles around what is the bottom line that I’m going to invest into. Too often people are like, “I’m going to run the numbers.” What result do you want on the numbers? Run them all you want, but you can get different results depending on what numbers. There are a lot of people out there that loved to throw out the pro forma. People are like, “Pro forma has to come up with this.” When you look at all the numbers most of us made up anyway.

Professor John Abernathy at the Kennesaw State University tells his students that pro forma is made up. None of it is real. It’s hopeful. Let’s look at real numbers. I take these investors back to the principles of the real end result you’re trying to get and I can show them how the real estate gets there. It’s not all about the loan. The loan in my opinion, that’s a 30-year fixed mortgage that we can get is the greatest asset associated with the transaction. It’s not debt. This is a great asset.

When I back them into how to find that as the asset, because the inflationary environment we live in, the tax environment we live in, the appreciation environment. The appreciation is easing on the radar, the amortization of the loan by your tenant and that cashflow, even if the cashflow is $150 to $200, if you’re buying in a place that will stay reasonably rented, it has the ability to raise rents because of inflation. I can show you how it’s 100% return, not some 9%, 10% or 12% cash on cash return model. If people are preaching that and that’s all they preach, they’re saying, “Look at this spreadsheet and if it does this at the bottom, you should buy it.” You need to walk away from those freaking people because they don’t know what they’re talking about.

They’re trying to sell you something. That’s it. You need to look at the entire thing as a whole. My goal is to take everybody I work with and convert their mindset to the proper mindset like we’ve talked about, become the CEO of their real estate investment business. Run it like a business. Get the right people on board to know the right things. There have been successful CEOs that say the reason they’re successful is because they find themselves and embrace the fact that they are the dumbest in the boardroom.

If you know more than everybody about their job, then you hired the wrong people. I tell my clients, “Welcome to being the dumbest person in the boardroom. I’m applying for a seat at your board table. If I have better information to offer than somebody else, I hope they have a shot at being at that table. If I do and when you come to me with the questions you have to consider and the decisions you have to make, I can help you make those in a way with practical information that somebody else chose to do. I can show you where they failed and where they have succeeded because I do 700 transactions a year for investors. Hopefully, you’ll make the decision and I’ll make you successful.” I even asked the question, and you probably know it, “Who made the most revenue during the gold rush?”

You have to be intentional about what values and motivations you leave behind. Click To Tweet

The people who owns the mine.

It’s the guys who sold the picks and shovels. It’s the outfitters. I explained to everybody, that’s me. That’s Paradigm. We’re outfitters. We’re selling picks and shovels. That’s how we’re going to better our table. The difference is we know where the gold are. It’s the real estate investment gold, the long-term legacy gold within these life insurance policies and being able to couple them with real estate. That’s how you extract the gold. That’s where you find it. If you’re successful in extracting it, what are you going to need? You’re going to need trucks. You’re going to need mining equipment. You’re going to need a smelter. You’re going to need a mill. You’re going to need a train to haul that.

If I’ve done my job, who are you going to come to get it? It’s us. Your success breeds my success. If you fail, I fail. I don’t want to sell one pick, one shovel. I want to make you so wealthy. You’ve got to come back to me for all the other things. Our success breeds further success for other people. It’s basically a big wheel. The client is the hub. We’re all the spokes. If one of us breaks another spoke in the process, the whole wheel is at risk. We can’t have it. How does this couple into investing gets back to mindset. Getting the mindset right of the individual trying to start. The desire to start is where it all starts from. You’ve got to take that first step. Darren Hardy says the first twenty seconds of a decision is where all the outcome comes from. You can decide to move forward or decide to be too afraid to step forward and you step back. That twenty seconds will create your outcome so step forward. We’ll help you, walk with you to get you where you need to go. You need to get the right people on your train.

I’ve been talking about a docuseries on Bill Gates. Have you seen Inside Bill’s Brain on Netflix?

I’ve heard about it. I started watching a couple of them. I haven’t seen all of them.

As you’ve been talking, I’ve been reflecting on the brain that he has and how he understands a lot of different things with what he’s trying to achieve, which is a lot of humanitarian good as well as solving significant problems. He operates the same way that you described. He knows what the end result is. He knows what his motivation is. He understands the basic question and principle around it. He has an entire network of those axes, picks and equipment, the people that are able to go, implement and execute. It was profound to watch that docuseries with that perspective.

He wasn’t doing any of the work. He was basically the first domino to say, “Here’s the problem. Here’s why we must solve it.” He enrolled other people that had expertise in different levels. He knew how to put teams together and how to inspire people. He’d sponsored some prizes. He did micro-funding of different businesses in order to achieve his end. He didn’t do any of the backend work. He came up with the idea, establish the results. He had this motivation. He knew how to put people in place in order to accomplish his end.

He stacked the dominos in design and knocked them off.

It’s similar principles. That’s what’s amazing is at that scale, which is a massive scale, making a difference for tens of millions, maybe even hundreds of millions of people, but also at the individual level. You’re trying to make a difference right now for your family, for your well-being, for your future. There are obviously going to be things added to that after. It keeps expanding.

Humans are the apex predator. We don’t fall prey to other species. We fall prey to other humans. Unfortunately, because of the marketing engines that are out there and the capability, people are figuring out a way, how do they prey upon somebody else’s pocket? I’m making sure that the entire world knows that’s not my intention. One of the things that I hate about my industry is full predators. All those predators out there are the people that I get to say, “You determine who they are or just know who I am. If you know who I am and what my team is about and what we’re about and we’re about you. That helps build our business even greater. As long as we’re helping other people, they feel like they’re getting them somewhere and start taking from them. I win as a result. I don’t need to concern myself with me. I’m not concerned myself with me. I haven’t concerned myself with my income in so long, even now I’m surprised that it’s there. I don’t have to worry about it. It’s not a stress of mine. I’m more stressed about somebody else’s.

When it comes down to those that have made a big difference, it’s because of them putting others in front of them. In the end, it’s the best benefit for them. I listened to what you’re saying and I come to this conclusion that when you start to realize your position in life and go from it being about you to being about others, you have the most fulfillment and the most meaning that comes from that. That motivation can’t die. Evidence of that is everywhere. Jon Huntsman passed away a few years ago in Utah, but he was a multibillionaire. That was his first principle. I read a lot of stuff from Ray Dalio. That was one of his primary principles. He’s connecting who he was with making a difference in other people’s lives. Everything came to him as far as his personal fulfillment and success because of that drive.

As we talked before, you alluded to some of the religious aspects of things in the Christianity and the depth of the scripture and stuff. It’s all there. The person who is more concerned of other people, you get there as a result. It’s an amazing thing that we’ve been taught our lives to not be selfish and unfortunately people are afraid that, “Nobody’s going to help me if I don’t help myself.” You end up hurting yourself in the process.

That’s how strong that drive is.

If you could somehow break that drive being all about you, you become all about you without realizing it.

How can the audience follow you and learn more about you? What’s the best way to connect with you, Aaron?

TWS 10 | Training The Next Generation

Training The Next Generation: Humans are creatures of habit, which means that they will always be guided by some form of habit, whether good or bad.


Go straight to the website, If you’re expecting to see a banker’s website, you’ll be at the wrong spot. You see a redneck sitting on a porch, you’re at the right spot. That porch is my office in Missouri. That brick and mortar story is in the book one. That’s the best way to get me there. I’ve got the LinkedIn thing. I’ve got a lot of stuff posted up there. My wife and my sister are working on Facebook and Twitter. I don’t know what else, Instagram or something. They’re working on that. I’m not in there doing anything, but those are the places you can find me.

Aaron, it’s been a pleasure. It’s been an awesome blessing to have you here.

Thanks for taking your time.

We’ll definitely need to do a follow-up to this especially when the next book comes out.

I’m looking forward to it.

Everyone, thank you for reading. Reach out to Aaron and get connected with him, even if it’s to be inspired and motivated by him through his social media presence. We’ll talk to you next time.

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About Aaron Chapman

TWS 10 | Training The Next GenerationAaron Chapman is a veteran in the finance industry beginning 1997, exited Mining, Heavy Equipment Operation, Welding and long haul truck driving. Since entering the finance industry his clientele has ranged from those purchasing their first home, building their dream home or investing in multiple properties for long term cash flow. His expertise is in the complicated. Presently ranked #14 in an industry of over 300,000 licensed loan originators for transactions closed annually (723 closed units for real estate investors in 2019, 707 in 2018 and 676 in 2017); Aaron is that battle-worn partner every real estate entrepreneur needs to walk thru the tough parts of building a real estate business.
In addition to a career in real estate finance Aaron is a Published Author with 4 books released and dozens of magazine articles. Very happily married to his wife since 1996 with 4 children. Aaron and his wife both take great pride in watching their children mature and make calculated decisions about their lives with their parents coaching. The hindsight education is openly discussed and both parent and child benefit from such conversation which has led to the creation of a family business where each member (even the 12-year-old) has a say in the family investments and growth of the family assets.
Aaron and his wife recently retired from 9 years of service with the Pinal County Sheriff’s office volunteer Rescue Unit. Both retired as team leaders. Aaron’s specific role within the Unit with designations as EMT (his wife is a Paramedic) was to lead the Technical Rescue unit as well as the Off-road and as well as the Air Rescue Unit’s. During those years the team experienced in excess of 50 rescues each year. In many cases, the missions completed received international media attention with lives preserved in extreme circumstances.

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The Capitalist System’s Agenda with David Morgan

TWS 11 | Capitalism


Some say that many governments have tried various economic systems, but there’s nothing like capitalism. How true is that in today’s government and market? Capitalism is a financial system where goods and services produced are through supply and demand in a market economy. A precious metals aficionado armed with degrees in finance and engineering, David Morgan gives more precise and in-depth insights on the different types and principles of capitalism. In this world of chaos that we live in, The Morgan Report founder sheds light on the importance of being accountable and trustworthy in business as he critics the current monetary and market systems.

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The Capitalist System’s Agenda with David Morgan

We’re going to dive into some philosophy as it relates to capitalism. I have an incredible individual that’s on. His name is David Morgan. He’s an economist, a precious metals expert, a writer and is the publisher of The Morgan Report. David, thank you so much for joining me.

Thanks for asking me. It’s a pleasure to be with you.

I thought I’d start off because of your expertise as it relates to precious metals, how your perspective about the tenets of capitalism is maybe slightly different as an expert in precious metals than maybe someone with an economics degree?

I’m going to go through a stream of conscious, I’ve thought about what you asked. First of all, I adhere to pretty much the Mises Institute, so that’s the if you’re interested. There is a huge book called Capitalism that you can get actually download or get the PDF for free off of the Mises Institute’s website. There are a lot of critics about capitalism and I would say justifiably so. Every system has been tried and nothing succeeds like capitalism. First of all, you have to define it and I’m not sure this is a textbook definition but basically, it’s laissez-faire or the free market. There are a lot of people that say, “If it’s a free market, anything can happen. You have to have rules, you have to have regulations, you have to have regulators and without this you’re going to have complete chaos.”

You can’t legislate honestly. You can legislate it but you can’t do anything but enforce it. In other words, the market itself is the purveyor of right, wrong and good, bad and that type of thing. In a free market, the idea is the sound principle is that if I create something, I can benefit myself. Capitalists are selfish, yes and no. In true capitalism or idealize capitalism, I invent something because I’ve got this idea that’s going to save me time and energy, and it works. My neighbors come over and say, “That’s so awesome. I want one of those.” You build one for them and you barter. That’s true capitalism. Real capitalism or idealized capitalism, I am benefiting myself and society at large. This is the free market. I’m going to expand from this idea.

Let’s say in the real world, that’s the idealized world. We have a situation where there’s competition of capitalism. If I invent something, it works, I start to have a market, I get my neighbors involved and they all like it. One of the other neighbors says, “That’s a great idea but I know how to make that better,” and he does. Then basically, I’m more or less out of business or theoretically, I’m out of business because my idea has been made better and away we go. The market itself has determined, “This is the better product.” I want to take that theme and explore it a little bit. If it goes way back into the early days of self-entertainment, meaning the television but then this thing came out called the VCR, where you could actually get a movie and play it on your own TV.

There were actually two main thrusters there. There was the VHS and Betamax. Betamax was the far superior system than the VHS but if you had pure capitalism, the Betamax probably would’ve won out. In our society, we have something called advertising. If you can advertise something that might be inferior but convinced the majority or the consumer that your product is better for variety of reasons, you can have an inferior product take over the market, which is what happened with the VHS. This is another example because this one that hits close to home because I was all for the Betamax. When I went to buy one, the salesperson was nice enough to tell me, “Don’t, it’s not going to happen. It’s going to go the other way.”

TWS 11 | Capitalism


I want to point out some flaws to capitalist. Let’s go to non-classic Liberal. In some cases, they’re justified because there are people out there that only think of profit. They are greedy and basically run scams. It happens but again, you could legislate in a way and say, “You can’t do that.” In an idealized capitalism, if I make a product and it’s an inferior product, no one’s going to buy it. The market itself is going to give me true feedback and I’m out of business because word gets out. I might think that the product, but if I think it’s great and the market doesn’t, it’s useless. That’s where the real free market will work if it’s allowed to. People have this greed thing. This is probably something out there, I don’t know if I’m inventing this word or not. I’m sure it’s out there somewhere but I would consider conscious capitalism.

Conscious capitalism is where you actually take into the large picture something like the Native-Americans and the Chinese purportedly where you’re looking out four or five generations. You’re saying, “If I build this product like this, is this to the highest and best good of all involved?” Take off on that thing and hopefully you can follow my train of thought. In this day’s capitalism, there’s built-in obsolescence. You have an automobile, a washing machine, a refrigerator or whatever. A lot of these products could be made better. Meaning that they don’t have to have built-in obsolescence. It’s possible. An automobile, it’s not a good example but a refrigerator washing machine and stuff, they can be built to last 30, 40 years fairly easily.

Of course, they’re machines and they can break down and need repairs but overall built-in obsolescence is morally correct or morally incorrect. That’s a tough question. In our view of capitalism, if I build this VHS tape player and it only lasts five years, then I’ve got a market every five years because people are going to go back and you’re going to get a newer one. I have my business model so that I stay in business. If you’re a conscious capitalist, “I’m building this thing that’s going to be so good that this is going to last a lifetime.” I have to build it one time. That’s a much better use of resources. This is more conscious capitalism, more than driving out where you think it through and I could take it on a tangent if you don’t mind but this is more where the Millennials are going with the minimalist idea. That I only need one of these things, I don’t need twelve.

I only need one set of dishes. I only need one set of glass or only one set of coffee mugs. I like that idea because, we speaking to the society at large, have become brainwashed or the propaganda has got us to such a degree that rather than take what we need, we’re constantly taught what we want. Our want can never be satisfied because we always want the next iPhone. You’re taught this. In your heart of hearts, you may actually realize it doesn’t matter. It functions the same. There’s not much difference between my six and the ten. I’ve got a six and I don’t want upgrade it but that’s the idea. We’re built into this obsolescence, consume, consume, consume. Whatever I’ve got, there’s a better one coming out and I must have it. These ideas are not necessarily capitalistic ideas. They’re more bet on the propaganda machine from Mr. Bernays and teaching people what they think they should think rather than use what I call conscious capitalism. I said a mouthful. I’m sure you’ve probably got some ideas throw back at me. I’d love to hear your thoughts.

I would say the premise of humanity is that we have fallibility. We make mistakes. We make wrong calls. We have a unique perspective. Everybody has a different perspective of the world. We operate off of that, but it doesn’t mean that the other person’s perspective. I look at capitalism and the framework itself is the exploration of what you think and figuring out a way to do well, to appease that self-interest exchanging with others. Equally, as capitalism can create a lot of wealth, it equally could destroy wealth. A person may have the right idea but they bring that idea to the marketplace and to them it was a good idea but nobody else thinks the same. I think capitalism goes both ways. It appeals to both sides of humanity, our side which is brilliant and can bring value.

If you don't profit, then you're basically out of business. Click To Tweet

In the process of trying to figure that out, when we do fail, it has to equally support that. As I’ve thought through this concept and thought through some of the things that you’re saying, in the end we have to believe that. We have to believe that there’s going to be success and there’s going to be failure. Ultimately, as you brought up laissez-faire capitalism, it’s one of those things where the equality is essentially the equal protection of individual rights. I think capitalism is definitely confused. There are multiple definitions and it depends on who you’re asking. Warren Buffett has a definition for it. Everybody has all their definitions of it.

Fundamentally, I think it’s pretty simple if people would actually take time to research it and it’s understanding that, we as humans have shortcomings and we also have this notion of self-interest. It’s figuring out what is the right system in order for those tendencies and instincts to operate. That’s where I go to, whether it’s Mises and there are a lot of others like the Austrian school but there’s also the Chicago school too that understood some of the primary fundamentals of capitalism. It’s one of those things where it’s reasonable to expect that system would work now as it was assumed to work 100 years ago just because of how much perception says we’ve progressed.

It’s been corrupted so much. Most of what we called capitalism is crony capitalism. Rather than go out and let the best product win in a real free market where there’s competition, they have a defense contract, which is a good example where it’s basically favoritism and political infighting. Who’s got the best lobbyists in Washington, DC to get a given contract during a given weapons program? It might be an inferior product but in real capitalism rather than the government funding and even the startup or the initial, let’s say piece of equipment or a piece of hardware, the entrepreneur wouldn’t have to go out and get funds one way or the other. Maybe they had a big success and had a lot of capital like Howard Hughes and they want to make something.

They have it within their own means to create something new and then there’s someone else that’s a competitor that raises funds. The market would decide which is the best. Like a foot race as a metaphor, this piece of hardware versus that piece of hardware, which one function the best, which one has the longest life and which one is easier to repair? We don’t have this anymore. We have a very small amount of it. There is this true free market capitalism in existence, yes but it’s rare. Most of the stuff, especially when you get government bigger and bigger has to do with who you know and this is called crony capitalism. It’s who you know, it’s what political cloud. It’s your district. It’s like, “We’ve never gotten funds for this. We should give it to them because they need to bring up their standard of living in this part of this district, of this town, of this state.”

TWS 11 | Capitalism

Capitalism: Every system has been tried, but nothing succeeds like capitalism.


It goes and it all sounds well-meaning but it doesn’t serve everybody to the highest and greatest good. The highest, greatest good is one capitalism and its real free market form and the market determining who’s right and wrong. I remember one of my earliest interviews I ever did on the internet is capitalism. It guarantees the right to succeed and the right to fail and that’s part of the process. I’m going to pick on Elon Musk. I don’t know him. I’ve seen him on TV, the internet and I heard him speak. He’s obviously quite brilliant. If Tesla was a true free market where he wasn’t subsidized, it would have failed. I’m going to add onto that. You can have a great idea who is ahead of its time, which means that you can have this electric vehicle from his Tesla motors and you can’t raise the capital and you can’t make it profitable.

Unfortunately, capitalism is based on a profit motive. That’s the way it is. If you don’t profit, then you’re basically out of business. We have crony capitalism, subsidies or whatever. He gets pushed. We need electric vehicles. It’s great and it’s wonderful. We’re going to subsidize them. He may have been ahead of his time where it wasn’t profitable at that time. He goes back to the drawing board and says, “I created a luxury car and it’s too expensive. I’m going back and I’m going to reinvent this thing. I’ve already got the basics, I’m going to go and I’m going to make the beetle, the initial Volkswagen of the EV market. That’s going to be my initial Tesla product.” It comes back out and the market’s like, “This thing is only $13,000. Are you kidding me?”

I’m not trying to pick on Tesla but everyone’s familiar with it so they can understand what I’m saying and get a picture in their mind. This is the idea of real free market capitalism. He might have failed temporarily and gone back. What does the market need? They’re awesome but is that what the market needs? What if the market needed a $17,000 EV that’s got a 200-mile range and everybody loved it? That’s what the market needed. The market comes out like, “Holy moly.” He’s only making, let’s make up a number, $1,500 per vehicle but he’s selling $12 million the first year.

There are two thoughts I have. The first one is agree with you. You look at whether it’s Amazon who is putting retailer after retailer out of business or it’s a Tesla that’s completely disrupting the auto market. Those markets were already manipulated. If you go back and look at how much GM has suffered through the years and how much political clout that they’ve built and spent. That cycle goes on forever, the unionization and how that has affected certain things. The second point I’m trying to make is our whole system has these elements of capitalism but the whole system is not based on it. This system is based on this cycle, which I think academia is part of it. You have funding for academia which bids up prices of tuition. You have students that are trained to be workers because of how our school system is set up based in the Prussian system.

Energy is a very important asset to own. Click To Tweet

You have the government that’s involved at local levels, federal levels in pretty much everything as far as who they’ll fund, what they will subsidize and what they’ll back. This entire system has been based on that vicious cycle and because of the capital markets, whether it’s leveraged by the Federal Reserve because of loose lending standards. You have a whole system which is based on these fundamentals, which is in capitalism. Still, I look at some of the fundamentals of capitalism very well would have prevented a lot of what we’re experiencing right, which I think there’s a lot of good stuff. There are also some things to be concerned about. I’m trying to figure out, where we haven’t had necessarily sound money for 50 years, 71, I believe. We never had capitalism so knowing that, what do we do? How do we understand what’s right, what’s wrong and how to understand what we do to live a fulfilling life?

I look at the study of economics and the study of capitalism, the free market system. It’s being aware of what those principles are. A lot of the unintended consequences, a lot of damage hasn’t occurred yet based on some of how our economy works but it’s ultimately going to occur whether it’s one fell swoop or whether it’s in pieces, it’s still going to happen. The awareness of these principles will allow people, to understand what to do when a lot of the chaos starts. In the past, what has ultimately been done? It’s, “Government should take care of it. I’m not responsible for that. They should take care of it. They’re smarter than me or that’s their role.” Other than that, I look at what capitalism was as far as the intention and the principles around it and what we have. I think there are some stark differences. At the same time, the notion of capitalism is still very much alive in everybody. It’s part of our instincts.

One of the fundamental principles of capitalism is property rights. You have the right to your own body. You have the right to make a living. Let’s go to a real baseline example. Let’s say we are somewhere in the 1800s and you can own land by staking it for example and you go out and you build a cabin for shelter. That is all by your own labor. Do you own that or not? On capitalism, of course you do. It was your labor, your ingenuity, you designed on a piece of paper or both and you made it. You took something that was raw, which was land and trees, you converted it into something more meaningful and of higher value. That’s an example of property rights and without that, capitalism breaks down. The idea that, “You made it but I need it more than you do so I’m moving in, you go build another one.” This is absolutely fundamentally anathema to true capitalism but this is the idea of socialism, each according to their need. I need it more than you do because I can’t work and you can or I’m too old to build one. I get it, you don’t and that’s the way this is equal. This is fair. This is what’s right.

This is a concoction of the mind is what’s fair and what’s right. To harp on it, the real capitalism is determined by basically competition and by the ability of someone or someone’s company corporations or whatever. What happens when these systems break down? This is not unusual. I want to assure everyone that there are cycles through the monetary system. It’s happening again and again. We’re in a situation where certain times in history, you have the fundamental philosophy breaks down and the fundamental philosophy is trust. What can we trust? Can we trust these big corporations to do what they say? Can we trust the government to do what it says? Can I trust my company to provide me the pension that it has promised me? Can I trust the city to pay me the pension that it has promised me?

TWS 11 | Capitalism

Capitalism: In most of today’s capitalism, there’s built-in obsolescence.


What happens in a corrupt system which we’re in and have been for quite some time, is the trust starts to be questioned. First by the intelligentsia, the intellectuals or whatever, I’m not trying to differentiate. People are different. Some are deeper thinkers, some look ahead and some don’t, some don’t care. It’s something the government should care take care about. I don’t have to worry about it. The company should do it. I worked for you. All I have to do is collect my check but you cannot overcome Mother Nature. There’s Mother Nature in the marketplace and the more you distort the market place, the more you’re going to have a price to pay. This is cyclical. This isn’t something that’s just unique to our generation. The trust breaks down and the confidence breaks down. The whole system is based on confidence and the whole system is a lie because the idea is you can’t print wealth and you can’t.

If you could print wealth, Zimbabwe would be the richest country in the world and everyone would be down in Zimbabwe because they’ve printed their selves as one of the wealthiest nation on the planet. America pretends that you still can print wealth and we’ve been doing it for a long time and we’ve gotten away with it because of the reserve currency of the world that’s basically enforced our currency on everyone else that must accept it. The people that must accept it of course use it because it works still to some degree. At the top, what Mises calls the crackup boom more and more people in the market place start to question, what is the viability? What is the long-term confidence that I have in this piece of paper, in this idea, in this unit, in this thing in my account? That starts to break down and it’s already breaking down. In fact, it broke down to such a degree in 2008.

We’re a cat’s whiskers away from having to complete financial collapse. Most people don’t believe that. I’m not saying that to gain points or to scare people but it is a truth. Most people are unaware of actually how close we came to a complete collapse. The reason I say complete collapse is because when the banks give up the trust of each other, which had happened, then the whole system would freeze. As Jim Rickards says the Ice-Nine situation. He used the metaphor where everything freezes up. We’re very close to that. The only reason we didn’t freeze up because it was starting to happen, the ice was starting to freeze. It was starting to take off and the Fed intervened and said, “Bank A don’t trust Bank B’s paper. Bank B doesn’t trust Bank A’s paper. Here’s what we’re going to do. We’re going to buy all this worthless crap, we’re going to give you treasuries for it, the most trusted paper out there.” That kept the system from freezing out but we’ve got very close.

The next time, will the Fed be able to intervene, paper it over, make it better and all of that? The answer is no one knows. I don’t know. You don’t know. No one knows but the game is getting very near the end. The main thing to watch of course is the bond market, the debt markets and credit markets. Do you trust that dollar to be worth enough in the future for you to loan it for a given period of 6 months, 2 years, 5 years, 10 years or 30 years? It’s breaking down and yet the system isn’t allowed to function as a free market would. In a free market or a true capitalistic system, the right to succeed means the right to fail. The bond market would fail and these bonds would be marked to market.

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They might not go to zero but it would certainly be worth less than face value almost across the board. This, of course, is allowed to happen because of the powers that we are able to basically buy up their debt. They could come in and buy up their own bonds, issue currency for it and keep the game going. Eventually, it gets to the point where enough of the market says, “I don’t trust what that dollar is going to be worth in the future. I’m going to spend it for something that’s a hard asset that I can maintain value and I am going off these dollars. I want to get rid of them because I’m not sure what they’re going to buy a month or a year.” This takes place over and over throughout the world. It’s happening in Argentina. It’s happened in Valenzuela. It’s all over the place. There are so many times it’s happened. The idea that it can’t happen in United States or the world currency, the US dollar is preposterous. This actually is happening but most people don’t recognize it. That’s what we see. Philosophically, it’s a loss of confidence, loss of trust and once that’s lost, it’s very difficult to get it back.

One of the points was this notion of accountability. That’s what you were saying when it comes to trust. Part of that human element that we have is some people don’t tell the truth and some people do it consciously. Some omission and commission. It’s one of those ideas where, what is this the standard way to protect everyone? It’s to have something that doesn’t attach to a human being that can be used as a unit of accountability. That’s where precious metals because fundamentally it’s very difficult to manipulate. You can’t create gold out of nothing. That’s I think the fundamental premise but we’re way beyond that.

We’re in this environment where the United States is that beacon of trust when it comes to any financial exchange around the world. Whether the reserve currency or whether because we have the biggest military force or whether it’s our influence on goods and so forth. It allows making sanctions at other countries. It allows us to throw weight around but in the end it’s a fallible unit of trust that we have. I was curious to understand your perspective and understanding of precious metals at a very deep level. How do you balance that with what our current system is, which is operating around the same thing in a sense like trust? That’s where the accountability is. At the same time, it’s not a completely objective trust.

I want to hold that thought but you did a great job on why the dollar still remains where it is, is it the military forces? One thing I’d add to that as the Rule of Law. The other nation states don’t necessarily operate in the same standards of the United States and also used to. The reason it is that the rule of law is breaking down. The reason there is the legal system in a lot of ways is due to business and contract. If you didn’t meet the contract, then there’s a legal remedy but that also is breaking down. The loss of confidence goes to, “What can I have confidence in that will see me through financially?” The answer there is primarily gold. Gold has stood the test of time for thousands of years. Ups, downs and in between and the value does vary but nonetheless, it never goes to zero. It’s always coveted, especially in times like these where we’re unsure of what that dollar is going to buy a year out or ten years out or whatever.

TWS 11 | Capitalism

Capitalism: The society at large has become brainwashed or the propaganda has got us to such a degree that rather than take what we need, we’re constantly taught what we want.


You’ve seen the banking system actually had the largest purchase of gold that they’ve had in I think eleven years or something. It’s a massive amount that they purchased relative to what their purchase has been in the past. The public is burn out on the gold story. Gold went higher year over year for eleven years straight. That’s a pretty darn good bull market. That peaked out in 2011 and here we are years later, it’s been going sideways to down. We found the bottom, I believe. Even the gold bugs had given up. The thing about gold is I think a big misunderstanding about it. Here’s the idea that I have and it’s pretty simple. One is you buy gold, you sleep better and you forget about it. You own it because at times like these it’s a must if you can afford it.

The other part is you buy it because you want capital gains. You want to have a better life, you want to see the price appreciation so good relative to when you bought it you can basically improve your lifestyle. There’re two types of gold purchases. You have people that understand that by some enough for their protection, which is generally thought to be 5% to 10% of your overall net worth. It could be as small as 2%. It’s basically what makes you comfortable and forget about it. That is not the vast majority. Those are the true gold bugs. Most of those people don’t consider this to them gold bugs, they consider themselves smart enough to understand the nature of fiat money to hedge. The vast majority are looking to trade it or swap it or whatever make these big gains on it. When gold doesn’t perform within a certain timeframe, then they’re very disappointed.

Silver is even a different story. Silver as Professor Jastram called The Restless Metal. As he wrote that book, you looked at silver’s relationship to commodities over a vast period of time like he did with the gold constantly. He looked at gold the same manner. What he determined was that gold basically is the ultimate money and regardless of conditions, especially during depressions, gold was the best asset you can own. Silver was mixed. Some other time during the depression, silver actually did well, sometimes during depression it didn’t. Silver, the conclusion of the book was during inflationary times, nothing outperforms gold. We saw that take place when QE2 was announced, when QE1 took place, the market acknowledged where we probably need it. We saved the banking system. We’re going to get back on track.

When QE2 was announced, most of the people that are monetary savvy said, “Here comes the inflation.” The problem was that all those savvy people and yours truly included and I traded that market did very well but none of that money, none of that QE hit main street. It only went to Wall Street. Basically, it was static money. It was sterile. It was there but it was all printed. It went to a vault and stayed there. It didn’t circulate. It had no velocity. It didn’t have any meaning in the marketplace. Once that was made clear to the market, the price of silver basically crashed. Most of us, myself included thought when it was announced that we’d see the velocity of money increase. We’d see it hit main street but didn’t. That’s been the story ever since. A lot of forces going back and forth.

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The idea that I think was the best that I can give to the public at large is, take the attitude of someone that buys gold, silver or both with a comfortable amount and go about your life. You can pretend that we’re not going to have a financial collapse. I think we will. I think it will occur in my lifetime but you don’t want to harp on it. You don’t want to live your life thinking about it. All you need to do is be hedged but most people that learn this think, one is going to happen. It’s almost imminent and that the only asset class to own is this one. That’s poor thinking. Energy is a very important asset to own. If you’re a capitalist as far as, “Where can I put my money and make money with it?” What is the one thing that’s gone on from 3,500 BC where have been 14,000 wars since there has? If you want to invest, buy defense stocks, buy Lockheed and the war machine continues. Chris Duane calls it the Debt and Death paradigm and he’s correct. Unfortunately, that is the real world that we live in.

I look at the complexity of the world we live in and it’s interesting. I would say at the same time you look at how concerned you could be looking at debt clock. You’d look at that and it’s like, “This thing’s going to pop tomorrow.” You also look at humanity and how much they’ve taken ideas and done some brilliant things with it. It’s one of those things where it’s always been the case with humans. There’s always been good stuff that’s going on. There’s always been some bad stuff. It’s trying to figure out how to keep a balance of it. As much as there are a lot of ways to be concerned, there’re also a lot that can be celebrated to an extent. I’ve stood back and I’ve said, “I don’t know what the future’s going to hold. I love your point about trust. People especially in times of difficulty will seek trust but they’ll seek something that they trust. Somebody or some group of somebodies failed them and did things that weren’t trustworthy.

They’ll seek trust but in the end it’s an awareness of how people work. It’s also an awareness of what principles are. I know that there’re some principles to capitalism that still are extremely relevant when it comes to personal freedom, personal capitalism. Which is taking who you are and what you know and doing something with it that’s of value to somebody else. If that is claimed, you definitely want to be aware of questions to ask and a good foundation of knowledge so that you know what they’re talking. There’re so many different definitions of capitalism. In the end, I look at it being an incredible time to be alive. It’s understanding that when you go against principle, there’s probably some sayings around, when truth or principles followed what the result is going to be. It’s going to come home to roots.

These are decisions that are unprincipled and they are decisions that have to have a price paid for them because failure means loss. There’s lots of different failure being papered over, whether QE, what the Fed’s done, government policy in general but there’s a lot of failure being deferred. It’s being aware of how to position yourself both from a business standpoint, from a personal standpoint, from a money standpoint, so then when those corrections happen, you know what to do. You’re not operating out of scarcity and emotion. You’re operating out of awareness and knowledge. That’s the most that we can do in the end.

TWS 11 | Capitalism

Capitalism: What can I have confidence in that will see me through financially? The answer there is primarily gold.


Maybe we’ll do a little bit more a philosophy. The idea of founding the nation, you can work capitalism into it and the idea of property rights that we already discussed is the rights of the individual. In a constitutional republic, the rights of the individual are protected. Democracy actually comes from the word mobocracy which is mob rule, majority rules. In the constitutional republic, the rights of the individual are preserved. That’s key in a way that the system was set up initially because that protects someone to have the right to not only free speech but free thinking and motivations based on their own personal goals. If in an idealistic world, if you have an idea and make something of value to you and the market says we want it to, you can become rich. There’s nothing wrong with that, at least from my perspective.

The whole thing has been usurped and corrupted by such a degree that people don’t even seem to understand how the system could work. If you go back to the financial failure of 2008, in real capitalism all those banks that were over-leveraged would have failed, not only Bear Stearns and Lehman Brothers but many others. In fact, AIG would have failed. AIG that insured all of these CDOs, all these swaps and everything else is out there in this derivative Never Neverland couldn’t make good on it. The backing of full faith and credit means that everybody that’s a taxpaying person in the United States is responsible but why are they responsible for a bank’s failure? The banks should be held accountable. It comes back to your accountability. Who’s accountable? Let’s make the people accountable. This is what most people don’t even understand. They didn’t have a clue. They think the government actually produces something. The government produces misery most of the time.

The reason of the misery is because the failure of those institutions are put on the backs of the people. It was subsidized by you. If you’re a US-taxpaying person, you’re the one that’s paying for that failure. It’s not the government paying for it, you are but this is a concept that most people don’t even get in school. I don’t think it’s even taught anymore. It comes to accountability. Who’s accountable? If you go run up to your credit card and you can’t pay it, then it’s your right to put it on your uncle because after all, that’s the way the system works. He’s more capable of paying it than you are. Let’s swap it over to him. That’s basically what’s taking place. Most people are so under-educated. I don’t want to offend anybody but I’m not here to sugarcoat it either. You’re responsible, why are you responsible? You shouldn’t be, the bank should be held accountable, but they’re not.

This is one of the biggest problems with the system at large and this is why the distrust in the currency goes to the next level. The velocity of money starts to pick up where people would rather own a jar of peanut butter that they know that’s cumbersome. I see inflation in a much higher level and many do. John Williams, I have him on my mastermind series about once a year. I read his work. The hamburger index and everything else are going off down a rabbit trail. I’m not a big fast food guy. I try to eat healthy most of the time but occasionally I do it. Here’s my point. A basic meal is $12 in there. I couldn’t believe it has been such a long time since I’d been into one of those places. I thought I misheard the guy. I thought I ordered two meals but this is real inflation. This is what mom and pop in America are facing. I think the inflation rate is squeezing a lot of people and it’s evident across the board.

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You’re right but here’s the thing. Nobody knows what that means. They see higher prices, they hear the word inflation, but they have no idea how it’s created and why it occurs. It’s not a natural phenomenon. It’s like, “Why are prices going down? Isn’t that a good thing?” but yet prices are going up. It’s a fundamental question around, “Why is bed policy for things to become 3% more expensive every year? Why is it 3% less expensive?” I was in Walgreens. I had to renew my passport. I heard this older woman at the counter and she was buying makeup and she was stuttering. She didn’t know what to do. She was like, “I can’t afford it.” She didn’t pay for the makeup. She paid for some other things. People are experiencing it, but they’re not aware of what it is and why it’s occurring. That goes to everything that we’ve been talking about, which is the current monetary policy is fundamentally flawed. It’s not trustworthy but yet people are trusting it. It’s not going to be this slow process. Everyone’s buying stuff and exchanging and it goes really quick. The only thing that you can control and influence is your awareness, your knowledge and your understanding of how the system works. When things start to happen, you know how to respond to that, not react.

I think one of my main job for the public good on a global basis is to teach these principles to the people and have an understanding. Then they can go and take an action, or not take an action but at least they could explore. They don’t have to take my word for anything. Look it up, do your own research. Do some reading. Look at the grand inflations of the past. There’s so little awareness and that’s the reason there’s such a small market for the gold and silver markets because most people have no idea that they preserve wealth and there are financial asset for thousands of years. If that was well-known, you’d have a lot different percentage into those metals than you have now.

One of my most popular videos called Myths in the Silver Market. One of my pet peeves I said in the video was this idea of most of the coin dealers or precious metals dealers that you will talk to, especially those that are more established than I am. I’ll tell you why I think everyone should own a little. This goes back to the idea we talked about that everyone should know a little. What people don’t understand is how few people actually take action. In that example on this video, I said at the time the mining activity was roughly 700 million ounces a year on the silver market. If everyone in the United States owned two ounces of silver, which is very little. It’s $30 worth. It’s not going to change your life. Two ounces of silver, believe it or not, goes to $100, it won’t change your life. It goes to $1,000. It might change it a little bit but it’s not changing your life. It’s a little warm up.

If everyone in the United States bought two ounces of silver, it would take up the entire mine supply on an annual basis. The United States is only 5% of the world’s population. If we include everyone, the other 95% of the people on the planet should own a little. There isn’t enough silver for everyone is my point. Yet, so few people own it or understand it and it doesn’t have to be silver, but silver is a good example. It is my specialty and I enjoy a lot of aspects. If you go back to 1980 at the top, most of us think that the amount of gold in portfolios of roughly 2% maybe 3% and now it’s about a half a percent. If we went back to the 2%, we need a four-fold increase in the amount of gold demand that we have right now. Think about that. Think if there was a four-fold increase in demand for gold, the world would be a better place.

TWS 11 | Capitalism

Capitalism: In an idealistic world, if you have an idea and make something of value to you and the market says, “We want it, too,” you can become rich.


This has been fascinating. I know we could probably keep going and all on all of this. I look at as an expert in a certain field. Historically, it has been pertinent to understanding money in general. Looking at where we’re at now, I’m sure you’re as surprised as I am. The more you learn about how the monetary system works, the more you learn about business cycles, especially if you understand about the Austrian business cycle, which shows that the Central Bank is at the hub of financial collapses or financial corrections. We’re well beyond what is reasonable but at the same time we’re still kicking along every day. The future is going to be bright, but also the future is going to be very volatile I think because of the technology that’s coming online. I also think because of how connected the world is becoming, how many people are joining the internet and becoming connected in emerging markets especially.

It’s going to be interesting to see how things transpire. I still cling to my understanding of financial principles and monetary principles in essence. Even though they may not be the clearinghouse right now, it’s a deferment of what should be clearing right now. If you understand that, you’re going to understand what those signs are when things start to get volatile. I also step back and say, “That could be totally wrong.” Who knows? They can maybe come up with some new principals. The modern monetary theory is absurd. People are advocating, some of these don’t make any sense. In the end it’s what can you do? It’s becoming aware and becoming educated. With that being said, I’ll give you the final word. Then would you mind giving out your contact information, your website, your YouTube channel, social media, so people can start following you?

First of all, money’s important but you don’t have to make it the center of your life. Most people think about it almost constantly, especially if you don’t have enough. It is part of life. There’s probably a better system out there. As it stands now, there’s nothing better than a true free market capitalism. It’s been proven over and over again. Where we are going to go in the future is very interesting because with this Modern Market Theory, which is preposterous, but I have to say with the advent of the digital currencies, which is basically everything that’s on your VISA or credit card and the advent of the cryptocurrencies. It’s not inconceivable to think that you could create more something out of nothing, ad infinitum and keep this thing going a lot longer.

I’m certainly open-minded enough to see that that’s a possibility. It’s unlikely, but unlikely doesn’t mean impossible. As far as getting ahold of me, the best place to go is our main website, which is If you’re interested in my new project, there’s a webinar that you can get for free. The URL is We’ve broken it up. I think it was about an eight-hour lecture between me and some of my colleagues. They’ve got it toned down to about an hour and a half. As far as social media, I am on YouTube, I’m on Twitter. I do have a Facebook presence. The best thing to do is type in any search engine, David Morgan Silver. If you type in David Morgan then the word Silver, you’ll find the LinkedIn, you’ll find the YouTube. You’ll find all of the social media.

David, it was an honor to have you on. Thank you for sharing your wisdom and everything that you’ve studied for so many years. It’s been an awesome conversation.

Patrick, I appreciate having a conversation. Thank you.

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About David Morgan

TWS 11 | Capitalism

David Morgan is a precious metals aficionado armed with degrees in finance and engineering. David considers himself a big-picture macroeconomist whose main job is education—educating people about honest money and the benefits of a sound financial system. Besides being an author of three books dealing with precious metals, he is also a much sought-after public speaker. Additionally, he consults with hedge funds, money managers, and mining executives.

His ideas can be seen in the movie Four Horsemen, a Feature Documentary. Available for free at

As publisher of The Morgan Report, he has appeared on CNBC, Fox Business, and BNN in Canada. He has been interviewed by The Wall Street Journal, Futures Magazine, The Gold Report, and numerous other publications.

Additionally, he provides the public with a tremendous amount of information by radio and at times writes in the public domain. You are encouraged to sign up for his free publication which starts you off with the Ten Rules of Silver Investing where he was published almost a decade ago after being recognized as one of the top authorities in the arena of Silver Investing.


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