in 2014 Tony Robbins wrote money
mastered the game which became an
instant bestseller on the New York Times
list the book contains information
stemming from interviews with over 50
financial experts if you want to learn
about mastering your money Tony Robbins
has done the work mentor me Tony I want
everybody’s watching to remember one
thing
the biggest myth you have not the one
that’s been sold to you that hurts you
is the average person thinks finance is
so complex because frankly the industry
tries to make it sound complex they use
words that you don’t know so you don’t
know what to do you know what does this
mean and so what happens is we just give
them our money and say deal with it and
we don’t realize that system has been
set up it’s not an evil system it’s set
up by corporations they’re looking at
maximize profit for those corporations
they’re not looking out for the investor
because this investor second and we
think we’re first and we’re not so the
first piece is you got to know that
you’ve got to you can’t wait till you
have a ton of money to start investing
and think I’m not an investor what you
got to do is say rather than my Apple
phone let me own Apple stock let me own
a piece of all the best companies not
just Apple I’ve got to become an owner
or I’ll always be in scarcity if you can
invest in business even a small amount
you can grow I don’t care how small it
is but you got to automate it there’s a
gentleman named Theodore Johnson who
it’s worked for ups start as a driver
never made more than 14,000 total in a
year that was his highest salary in a
year in his old ages were seventy
million dollars and how did he do it all
he did was when I teaches the first step
is you got to take a percentage of what
you earn and pretend it’s a tax you’re
never gonna see that money again you
automate it it goes straight to the
investment account and you never see it
as money you can spend
he did that with 20% he said I can’t say
five somebody in his family said if
there was a tax you’d pay it and they
made it 20 percent when you save 20
percent and you compound it it’s numbers
are incredible before you get in the
game know the rules be the insider
because when a person with money meets a
person with experience we all know what
happens phrase man said person with
experience ends up with your money so
what I want to do is save you that I
give you nine myths 9 lies that you’re
going to make sure never happen to you
again they’re all marketed and one of
those myths that even ideas fees don’t
matter or it’s only 1% that’s what he
says and I go through and show you
systematically what it means if you pay
1% a real 1% which almost nobody does
versus 2 versus 3 you’re buying you can
have three people they start at the same
age to put on the same amount of money
they invest in the same stocks same bond
same mutual funds and 30 years later
they show up and one’s got 77% more
money you know they start out with a
million bucks
you know they got 7 billion the other
guy’s got four if it’s $100,000 seven or
thousand versus for the amount of money
difference of those fees and if I said
to you bring thyn here’s the deal I want
all you make an investment thing here’s
how it’s going to work I want you to
give me your money you’re going to put
up all the money you’re gonna take all
the risks if it loses money to lose
everything you lose everything there’s
no consequence here ya know you put a
balm I take a risk you take all the
losses but if you make money and even if
you don’t make money I get paid and I
get over the course of your lifetime of
investing 30 40 years I’m gonna take 60%
would you make that deal nobody would
but they don’t know that they are all
day long you truck if that is what you
do with the average mutual fund today
because the average in which you found
with Forbes is 3.1 percent if you’re in
a 401 K instead of saving money many
times you get all the other fees
according to Forbes it’s four point one
percent those bad does to your ability
to ever get financially free as it
basically decimates it and how how’s
that possible
Jack Bogle had a vanguard taught me this
he said Tony watch because people don’t
know they they don’t do the math for
every one percent you give away over the
course of your lifetime that’s
approximately 20% of your total take so
if there’s 3 percent of fees you give up
60 percent you took the risks you’re on
the line they took no risks and they’re
going to take 60% over the lifetime of
what you’re doing he said it’s highway
robbery that’s why you killin s in the
same stocks with Vanguard on an index
and you pay 14 basis points which that’s
another term by the way every time I use
the term in the book I explain like
basis points what the hell is the base
points it’s point one four percent
someone says 25 basis points that means
a quarter of a percent right so if I say
an index funds you know it is
what it is in the books oh that smells
good you two don’t get along the way and
I give an example so to see what it is
so what you do is you become an insider
because because what happens is every
type of powerful institution or
organization or field has its own
language because that’s how they keep
power so if you go to your loiter
there’s a lot of things you know I could
easily do ourselves but we don’t know
the right legalese so they’re words that
you could say in English they say and
legalese and we can’t do is we got Pam
for it you know a good lawyer is a good
lawyer but sometimes are things you
could do you know some of the company
online companies are charging $20 what
some dollars used to charge 2004 the
capacity to strengthen and increase your
hunger is the one common denominator
amongst the most successful people you
know Richard Branson’s good friend of
mine and Peter Guber Steve lent all
these guys they’ve never lost their
hunger most people are hungry to achieve
a certain amount make a certain amount
of money and then they get comfortable
and relaxed or to get a certain level of
fitness and then they relax but you know
Richard is as driven today as when he
was 16 years old starting I mean it’s
like on fire and he’s 65 years old
Warren Buffett is 85 years old he’s is
driven today as when you know he began
the journey right and so people that
have that hunger I believe intelligence
I love people that are wickedly smart
and I work to be wickedly smart by
educating and training myself and self
what they’re training my brain but
intelligent life there’s a lot of
intelligent people can’t fight their way
out of a paper bag right hunger is the
ultimate driver because if you’re hungry
you can get the strategy you can get the
answer if you can’t model it you can
find it another guy interviews a man
named Kyle bass Kyle bass took 30
million dollars gathered money together
a lot of money but other people’s money
turn in a 2 billion in the middle of the
subprime crisis that’s a very or a big
return you can say that in two years
right oh my god like how did you do this
as CS market loose several books you
even they open up the chapter in some of
the most destroyed books written
recently the gentleman who wrote Flyboys
also wrote one of the books any sports
I’ll talk about Kyle bass doing this
this incredible piece it’s like it’s
like being there with him
but the way he did it was he risk six
cents to make a dollar and you just
leverage that up so he could be wrong
how many times it still breakeven
fifteen he’ll be wrong fifteen times and
make money so what he’s also smart as
hell he looked at things he evaluated
things it’s more detail that I explained
in the book but the core they all have
in common is they risk for valuable
returns the freedom fund is this idea
nobody wants to save right and
Millennials right now order the worst
chop of it a long time and it’s not
because they don’t care they’re
irresponsible frankly they don’t trust
the market you know they saw what
happened in 2008 they don’t know where
to really to go and so they’re being
stimulated like crazy and they’re
spending like crazy but if you really
want to have freedom that what you have
to do is you’ve got to take that
percentage aside like Theodore Johnson
did and you got to just say this is for
me this is my free there’s a part of
what I earn his basic as it is we all
know this from investing that’s a part
of what I earned that is mine and my
family’s to keep and no one’s going to
touch it I’m going to grow it and but I
also believe that where you put that
really matters and so indexing is the
most basic way to do it for sure but
what all these investors showed me is
asset allocation is where the difference
is in business right in life if you look
at it the fourth key we talked about in
the four steps is you got to really
understand asset allocation because when
I was with David Swensen David said Tony
I said what are the dials you can move
there’s a limited number of dollars you
can move to increase your returns to get
to your financial freedom faster he said
oh there’s really only three he said you
can make a better choice selection of
the actual investments of the securities
you can have better timing or you got a
better asset allocation so let me give
you a clue the first two will never
happen he said because they cost money
if you get them from somebody else and
everybody’s wrong on timing everybody’s
wrong in the stocks this is where all
your money is made as asked look at that
this leads to what sound goes against
all the conventional wisdom which call
all-weather allocation let’s talk about
that that’s what which stocks only
thirty percent yes like explain yeah so
I sat down with a famous ray value right
right and I prepared for 18 hours for
that interview because he’s a genius
there’s not that much on him I wanted to
absorb it all so I got every little bit
of it sat down with and it turned out
ray was a fan of my work which I was
touched by 20 years ago I guess he
listened my programs he was very
generous with his
and we spent these three hours and in
the three hours when I got to the end I
said to Reyes said listen I really want
help the average person so I got a
question for you I did this with
everyone I said if you couldn’t give
your money to your children any of it
and all you could do would be give them
a portfolio or a set of investment
strategies or instructions and they were
going to start over and build it what
would it be nice Tony I spent a decade
figuring that out all my money is
already there my kids money is there my
money from philanthropy when I’m gone is
there cuz I’m not gonna be here and I
want something it’ll do well in the
future and I don’t know what the future
is going to be markets are gonna always
change I need something that could work
in any mark and I call it my all-weather
fund most of us in the business are
familiar with it a little bit and so he
explained it to me and I have a good
understanding and I said I get it so
what you’re saying is the reason why
this was obsessed him why is he defined
the balanced portfolio in 2008 I got
nailed on both sides why did that happen
in 2000 everybody says portfolio theory
this is supposed to protect me and it
didn’t work but he said as soon as
things get better no one talks about it
we just forget about it happens again
happened in 2000 happened in 2008 he
said I figured it out when you have a
50/50 portfolio right that’s 50/50 of
where you put your money in assets 6040
5050 I love you look at balanced
portfolio right but he said the problem
is that’s not balanced risk this is
where people are crazy I’ve seen people
write things up they see this in the
book and say Tony Robbins is promoting
first I’m not promoting anything every
word in this book is from the best
investors on earth anything it’s from me
is about the emotions that I know for 36
years that’s been my expertise these are
their views but I’ll tell you what’s
amazing he’s a Tony when you have stocks
and bonds half and half you’re not equal
because equities are three times more
volatile so your risk is ninety five
five he said so that’s why people get
killed in a 2008 he said I try to get
this through to people he said but all
of our people handle it you know you
manage money for countries the largest
you know pension funds on earth he said
what people don’t this and they look at
and go oh this is bond heavy the bond
days are over because inflation is going
forward he said it’s not true Tony this
fund in the 1970s it was the worst time
for bonds it was an extraordinary time
for all weather because it is it looks
over balanced because we only get the
same level of risk you have to go for
more long-term bonds or you have to use
more leverage on the bond side
and so when he was all done you know for
the average person complex I’m seeing
financial people look at this and write
things up that are just silly saying you
know this is this is never going to work
as we’re in the you know interest rates
the only place to go if in treats go up
it’s a balanced fund the other areas
kick in but here’s what’s interesting I
think told the whole thing to me I said
to him I said look I said this is
wonderful he’ll give me something that
very few people understand on the planet
I think I really got it and I played it
back to he said you got it I said here’s
the problem he how much person is never
going to know what to do with this and I
said I’m trying to help somebody that
needs to know what to do I said tell me
you’re telling me to make this beautiful
chocolate cake and you’re saying Tony
you’re sad to do it use some sugar right
use some chocolate use some dairy
products I need know the amounts you
know give me the amounts he goes 20
that’s my secret sauce and that’s when
he told me he said what 10 years ago for
you to even get it to talk to me it was
five billion net worth 100 million
dollars of getting in Michael and he
said and now for 10 years I haven’t
taken anybody’s money and she answered
your own question I said you’re not
taking money anyway it’s not going to
compete with you the average guy he said
is never going to make it talking to a
wealth manager tell me what to do and he
is so generous you know he’s giving up
half his net worth like many other
people and and in the end he said okay
said but it’ll be complex I said I can
make it simple he said well I don’t want
leverage in it as I when we got leverage
because it won’t be perfect I said I
don’t care if it’s not perfect you’re
idea of unperfect will be somebody else
idea is the best thing they could do and
they lane up the numbers we ran the
numbers and use the same back testing so
you saw a year-by-year how it really did
over the last 75 years of modern
investing and here’s what’s amazing like
all weather similar in 75 years it’s
been right 85 percent of the time
what’s even more extraordinary is the 15
percent what it wasn’t doing well what
it knew well it’s average losses 1.6
percent not 50 40 30 20 the last 10
years a 250 percent hit his biggest loss
in 75 years was less than 4% minus three
point nine five and that was 2008 when
the market exploded you know down to 51
percent here here in the allocations yes
in the book which would make a normal
person gag initially it sucks only 30
percent that’s right even though it’s
their stocks on average supposed to gain
what nine percent of yes nine point to
long-term Treasuries 40 percent yeah
intermediates 15 gold seven-and-a-half
commodity seven
have ya absolutely counter wisdom I know
it’s amazing
you know when I read interviewed David
Swensen he said he wrote a book and then
when he said the whole secret to success
is to be contrary to what else believes
but the math on this is what works
here’s what’s interesting that looks
like your heavy bronze 40 and 15 55 %
bonds and it looks that way visually in
terms of volume you are panned in terms
of risk you’re not you’re still you’re
making is you’re equally way to think of
it this way what triggers things to grow
is inflation or deflation in terms of
price certain things do really well in
inflation start doing deflation growing
economy shrinking economy and he’s
figured out which quadrant you need to
put each to actually have equal risk and
that’s why it’s not well this year this
formula has done it’s one percent better
than the markets in 13 and the third
right now and but more importantly three
weeks ago when the market dropped and
gave up all of its entire benefits for
the entire year and everybody’s guts
were checking there was no gut check
because they went up a quarter of a
point so the beauty of this is I’m sure
you know there was studied under the
last 20 years and the studies from 1993
to 2013 and spied Albar and they found
that the market the S&P 500 during that
time did nine point two percent on
average just as you said but you know
what the average mutual fund men now
owner got investor 2.5 percent that’s
before tax why because we as investors
always do the wrong thing emotionally
that’s right we sell we should hang on
we buy when we shouldn’t so the greatest
thing that I think that Ray offers
somebody the opportunity to do is
actually stay in the locker because if
you oh yeah if you got 1.6 percent as
your big-haired if 4 percent was the
biggest hit you’ve ever seen at 75 years
I think you could stay in and you can do
what Jack talks about which is stay in
that market through time just names
resetting each year it’s a reset once a
year that’s the one recalibration so 15
minutes a year and you’re in the game
thank you guys so much for watching I
hope you enjoyed the video I’d love to
know what you think have you read the
book what Clips do you find here most
relevant most helpful most interesting
what changes are you going to make in
your life as a result leave it in the
comments below I’m going to join the
discussion thank you guys so much for
watching
continue to believe and I’ll see you
mastered the game which became an
instant bestseller on the New York Times
list the book contains information
stemming from interviews with over 50
financial experts if you want to learn
about mastering your money Tony Robbins
has done the work mentor me Tony I want
everybody’s watching to remember one
thing
the biggest myth you have not the one
that’s been sold to you that hurts you
is the average person thinks finance is
so complex because frankly the industry
tries to make it sound complex they use
words that you don’t know so you don’t
know what to do you know what does this
mean and so what happens is we just give
them our money and say deal with it and
we don’t realize that system has been
set up it’s not an evil system it’s set
up by corporations they’re looking at
maximize profit for those corporations
they’re not looking out for the investor
because this investor second and we
think we’re first and we’re not so the
first piece is you got to know that
you’ve got to you can’t wait till you
have a ton of money to start investing
and think I’m not an investor what you
got to do is say rather than my Apple
phone let me own Apple stock let me own
a piece of all the best companies not
just Apple I’ve got to become an owner
or I’ll always be in scarcity if you can
invest in business even a small amount
you can grow I don’t care how small it
is but you got to automate it there’s a
gentleman named Theodore Johnson who
it’s worked for ups start as a driver
never made more than 14,000 total in a
year that was his highest salary in a
year in his old ages were seventy
million dollars and how did he do it all
he did was when I teaches the first step
is you got to take a percentage of what
you earn and pretend it’s a tax you’re
never gonna see that money again you
automate it it goes straight to the
investment account and you never see it
as money you can spend
he did that with 20% he said I can’t say
five somebody in his family said if
there was a tax you’d pay it and they
made it 20 percent when you save 20
percent and you compound it it’s numbers
are incredible before you get in the
game know the rules be the insider
because when a person with money meets a
person with experience we all know what
happens phrase man said person with
experience ends up with your money so
what I want to do is save you that I
give you nine myths 9 lies that you’re
going to make sure never happen to you
again they’re all marketed and one of
those myths that even ideas fees don’t
matter or it’s only 1% that’s what he
says and I go through and show you
systematically what it means if you pay
1% a real 1% which almost nobody does
versus 2 versus 3 you’re buying you can
have three people they start at the same
age to put on the same amount of money
they invest in the same stocks same bond
same mutual funds and 30 years later
they show up and one’s got 77% more
money you know they start out with a
million bucks
you know they got 7 billion the other
guy’s got four if it’s $100,000 seven or
thousand versus for the amount of money
difference of those fees and if I said
to you bring thyn here’s the deal I want
all you make an investment thing here’s
how it’s going to work I want you to
give me your money you’re going to put
up all the money you’re gonna take all
the risks if it loses money to lose
everything you lose everything there’s
no consequence here ya know you put a
balm I take a risk you take all the
losses but if you make money and even if
you don’t make money I get paid and I
get over the course of your lifetime of
investing 30 40 years I’m gonna take 60%
would you make that deal nobody would
but they don’t know that they are all
day long you truck if that is what you
do with the average mutual fund today
because the average in which you found
with Forbes is 3.1 percent if you’re in
a 401 K instead of saving money many
times you get all the other fees
according to Forbes it’s four point one
percent those bad does to your ability
to ever get financially free as it
basically decimates it and how how’s
that possible
Jack Bogle had a vanguard taught me this
he said Tony watch because people don’t
know they they don’t do the math for
every one percent you give away over the
course of your lifetime that’s
approximately 20% of your total take so
if there’s 3 percent of fees you give up
60 percent you took the risks you’re on
the line they took no risks and they’re
going to take 60% over the lifetime of
what you’re doing he said it’s highway
robbery that’s why you killin s in the
same stocks with Vanguard on an index
and you pay 14 basis points which that’s
another term by the way every time I use
the term in the book I explain like
basis points what the hell is the base
points it’s point one four percent
someone says 25 basis points that means
a quarter of a percent right so if I say
an index funds you know it is
what it is in the books oh that smells
good you two don’t get along the way and
I give an example so to see what it is
so what you do is you become an insider
because because what happens is every
type of powerful institution or
organization or field has its own
language because that’s how they keep
power so if you go to your loiter
there’s a lot of things you know I could
easily do ourselves but we don’t know
the right legalese so they’re words that
you could say in English they say and
legalese and we can’t do is we got Pam
for it you know a good lawyer is a good
lawyer but sometimes are things you
could do you know some of the company
online companies are charging $20 what
some dollars used to charge 2004 the
capacity to strengthen and increase your
hunger is the one common denominator
amongst the most successful people you
know Richard Branson’s good friend of
mine and Peter Guber Steve lent all
these guys they’ve never lost their
hunger most people are hungry to achieve
a certain amount make a certain amount
of money and then they get comfortable
and relaxed or to get a certain level of
fitness and then they relax but you know
Richard is as driven today as when he
was 16 years old starting I mean it’s
like on fire and he’s 65 years old
Warren Buffett is 85 years old he’s is
driven today as when you know he began
the journey right and so people that
have that hunger I believe intelligence
I love people that are wickedly smart
and I work to be wickedly smart by
educating and training myself and self
what they’re training my brain but
intelligent life there’s a lot of
intelligent people can’t fight their way
out of a paper bag right hunger is the
ultimate driver because if you’re hungry
you can get the strategy you can get the
answer if you can’t model it you can
find it another guy interviews a man
named Kyle bass Kyle bass took 30
million dollars gathered money together
a lot of money but other people’s money
turn in a 2 billion in the middle of the
subprime crisis that’s a very or a big
return you can say that in two years
right oh my god like how did you do this
as CS market loose several books you
even they open up the chapter in some of
the most destroyed books written
recently the gentleman who wrote Flyboys
also wrote one of the books any sports
I’ll talk about Kyle bass doing this
this incredible piece it’s like it’s
like being there with him
but the way he did it was he risk six
cents to make a dollar and you just
leverage that up so he could be wrong
how many times it still breakeven
fifteen he’ll be wrong fifteen times and
make money so what he’s also smart as
hell he looked at things he evaluated
things it’s more detail that I explained
in the book but the core they all have
in common is they risk for valuable
returns the freedom fund is this idea
nobody wants to save right and
Millennials right now order the worst
chop of it a long time and it’s not
because they don’t care they’re
irresponsible frankly they don’t trust
the market you know they saw what
happened in 2008 they don’t know where
to really to go and so they’re being
stimulated like crazy and they’re
spending like crazy but if you really
want to have freedom that what you have
to do is you’ve got to take that
percentage aside like Theodore Johnson
did and you got to just say this is for
me this is my free there’s a part of
what I earn his basic as it is we all
know this from investing that’s a part
of what I earned that is mine and my
family’s to keep and no one’s going to
touch it I’m going to grow it and but I
also believe that where you put that
really matters and so indexing is the
most basic way to do it for sure but
what all these investors showed me is
asset allocation is where the difference
is in business right in life if you look
at it the fourth key we talked about in
the four steps is you got to really
understand asset allocation because when
I was with David Swensen David said Tony
I said what are the dials you can move
there’s a limited number of dollars you
can move to increase your returns to get
to your financial freedom faster he said
oh there’s really only three he said you
can make a better choice selection of
the actual investments of the securities
you can have better timing or you got a
better asset allocation so let me give
you a clue the first two will never
happen he said because they cost money
if you get them from somebody else and
everybody’s wrong on timing everybody’s
wrong in the stocks this is where all
your money is made as asked look at that
this leads to what sound goes against
all the conventional wisdom which call
all-weather allocation let’s talk about
that that’s what which stocks only
thirty percent yes like explain yeah so
I sat down with a famous ray value right
right and I prepared for 18 hours for
that interview because he’s a genius
there’s not that much on him I wanted to
absorb it all so I got every little bit
of it sat down with and it turned out
ray was a fan of my work which I was
touched by 20 years ago I guess he
listened my programs he was very
generous with his
and we spent these three hours and in
the three hours when I got to the end I
said to Reyes said listen I really want
help the average person so I got a
question for you I did this with
everyone I said if you couldn’t give
your money to your children any of it
and all you could do would be give them
a portfolio or a set of investment
strategies or instructions and they were
going to start over and build it what
would it be nice Tony I spent a decade
figuring that out all my money is
already there my kids money is there my
money from philanthropy when I’m gone is
there cuz I’m not gonna be here and I
want something it’ll do well in the
future and I don’t know what the future
is going to be markets are gonna always
change I need something that could work
in any mark and I call it my all-weather
fund most of us in the business are
familiar with it a little bit and so he
explained it to me and I have a good
understanding and I said I get it so
what you’re saying is the reason why
this was obsessed him why is he defined
the balanced portfolio in 2008 I got
nailed on both sides why did that happen
in 2000 everybody says portfolio theory
this is supposed to protect me and it
didn’t work but he said as soon as
things get better no one talks about it
we just forget about it happens again
happened in 2000 happened in 2008 he
said I figured it out when you have a
50/50 portfolio right that’s 50/50 of
where you put your money in assets 6040
5050 I love you look at balanced
portfolio right but he said the problem
is that’s not balanced risk this is
where people are crazy I’ve seen people
write things up they see this in the
book and say Tony Robbins is promoting
first I’m not promoting anything every
word in this book is from the best
investors on earth anything it’s from me
is about the emotions that I know for 36
years that’s been my expertise these are
their views but I’ll tell you what’s
amazing he’s a Tony when you have stocks
and bonds half and half you’re not equal
because equities are three times more
volatile so your risk is ninety five
five he said so that’s why people get
killed in a 2008 he said I try to get
this through to people he said but all
of our people handle it you know you
manage money for countries the largest
you know pension funds on earth he said
what people don’t this and they look at
and go oh this is bond heavy the bond
days are over because inflation is going
forward he said it’s not true Tony this
fund in the 1970s it was the worst time
for bonds it was an extraordinary time
for all weather because it is it looks
over balanced because we only get the
same level of risk you have to go for
more long-term bonds or you have to use
more leverage on the bond side
and so when he was all done you know for
the average person complex I’m seeing
financial people look at this and write
things up that are just silly saying you
know this is this is never going to work
as we’re in the you know interest rates
the only place to go if in treats go up
it’s a balanced fund the other areas
kick in but here’s what’s interesting I
think told the whole thing to me I said
to him I said look I said this is
wonderful he’ll give me something that
very few people understand on the planet
I think I really got it and I played it
back to he said you got it I said here’s
the problem he how much person is never
going to know what to do with this and I
said I’m trying to help somebody that
needs to know what to do I said tell me
you’re telling me to make this beautiful
chocolate cake and you’re saying Tony
you’re sad to do it use some sugar right
use some chocolate use some dairy
products I need know the amounts you
know give me the amounts he goes 20
that’s my secret sauce and that’s when
he told me he said what 10 years ago for
you to even get it to talk to me it was
five billion net worth 100 million
dollars of getting in Michael and he
said and now for 10 years I haven’t
taken anybody’s money and she answered
your own question I said you’re not
taking money anyway it’s not going to
compete with you the average guy he said
is never going to make it talking to a
wealth manager tell me what to do and he
is so generous you know he’s giving up
half his net worth like many other
people and and in the end he said okay
said but it’ll be complex I said I can
make it simple he said well I don’t want
leverage in it as I when we got leverage
because it won’t be perfect I said I
don’t care if it’s not perfect you’re
idea of unperfect will be somebody else
idea is the best thing they could do and
they lane up the numbers we ran the
numbers and use the same back testing so
you saw a year-by-year how it really did
over the last 75 years of modern
investing and here’s what’s amazing like
all weather similar in 75 years it’s
been right 85 percent of the time
what’s even more extraordinary is the 15
percent what it wasn’t doing well what
it knew well it’s average losses 1.6
percent not 50 40 30 20 the last 10
years a 250 percent hit his biggest loss
in 75 years was less than 4% minus three
point nine five and that was 2008 when
the market exploded you know down to 51
percent here here in the allocations yes
in the book which would make a normal
person gag initially it sucks only 30
percent that’s right even though it’s
their stocks on average supposed to gain
what nine percent of yes nine point to
long-term Treasuries 40 percent yeah
intermediates 15 gold seven-and-a-half
commodity seven
have ya absolutely counter wisdom I know
it’s amazing
you know when I read interviewed David
Swensen he said he wrote a book and then
when he said the whole secret to success
is to be contrary to what else believes
but the math on this is what works
here’s what’s interesting that looks
like your heavy bronze 40 and 15 55 %
bonds and it looks that way visually in
terms of volume you are panned in terms
of risk you’re not you’re still you’re
making is you’re equally way to think of
it this way what triggers things to grow
is inflation or deflation in terms of
price certain things do really well in
inflation start doing deflation growing
economy shrinking economy and he’s
figured out which quadrant you need to
put each to actually have equal risk and
that’s why it’s not well this year this
formula has done it’s one percent better
than the markets in 13 and the third
right now and but more importantly three
weeks ago when the market dropped and
gave up all of its entire benefits for
the entire year and everybody’s guts
were checking there was no gut check
because they went up a quarter of a
point so the beauty of this is I’m sure
you know there was studied under the
last 20 years and the studies from 1993
to 2013 and spied Albar and they found
that the market the S&P 500 during that
time did nine point two percent on
average just as you said but you know
what the average mutual fund men now
owner got investor 2.5 percent that’s
before tax why because we as investors
always do the wrong thing emotionally
that’s right we sell we should hang on
we buy when we shouldn’t so the greatest
thing that I think that Ray offers
somebody the opportunity to do is
actually stay in the locker because if
you oh yeah if you got 1.6 percent as
your big-haired if 4 percent was the
biggest hit you’ve ever seen at 75 years
I think you could stay in and you can do
what Jack talks about which is stay in
that market through time just names
resetting each year it’s a reset once a
year that’s the one recalibration so 15
minutes a year and you’re in the game
thank you guys so much for watching I
hope you enjoyed the video I’d love to
know what you think have you read the
book what Clips do you find here most
relevant most helpful most interesting
what changes are you going to make in
your life as a result leave it in the
comments below I’m going to join the
discussion thank you guys so much for
watching
continue to believe and I’ll see you
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