ASK JAMES: MEET GOOD PEOPLE, THE ECONOMY, OCCUPY THE UNIVERSE, WAKING UP SCARED, AND MORE

Every Thursday from 3:30-4:30 EST I do a Q&A about anything in the Universe. People ask me about stuff ranging from the economy, to dating, to stocks, to who is the best superhero, to why am I so amazingly handsome but never was a male supermodel? I take some of the questions and give more expanded answers on a post that I put up either the next day or on Saturday.

Next Thursday I have to give a talk in Scottsdale, AZ so will miss the Q&A but will be back in form the week after. As I mention at the end of this post, I’m really grateful to anyone who asks questions. It gives me stuff to think about, it makes my life better,  and I hope it’s a little bit helpful.

THE ECONOMY

@billtheimpaler asks “What makes you so optimistic about the economy?”

ANSWER:  There’s really two answers to this: personal and public. The personal side is “why should you and I be optimistic right now about finding opportunity”.

Right now, with everyone so pessimistic, is the best time to be optimistic. There’s $1.6 trillion extra dollars lying around in the banks. Corporate America has an extra $2 trillion and there’s untold trillions in pension funds, retirement accounts, etc that are completely in cash. ALL of that money will eventually hit the economy. Any business started now that is halfway good will get their hands on that money.

“Getting that money” is the equivalent of “the Olympics”.

You can’t just hold your hand out and get an Olympic gold medal. You have to get in shape. You have to start coming up with ideas. You have to get rid of the crappy people in your life. You have to plan your exit from your corporate job which sucks 10 hours of life (and 50% of your money via taxes) out of you each day. You have to have gratitude for your health and for the loving people around you.

Then you have to start coming up with ideas. What do 76mm retiring baby boomers need? What do 750 million people on Facebook need? What do hundreds of thousands of returning veterans need? And so on. Find the demographic trend, any of them, and feed it. You will get paid for that.

(these baby boomers need our HELP!)

But on a more public level: what makes me an optimist?

-          Rail traffic is up! What does this mean? It means people are shipping commodities all over the country. Steel, oil, food, etc. Which means companies are about to start building things, which means companies are seeing demand pick up so they are getting ready to restock inventories, which are at lows. This indicator is almost never talked about in the media outlets. All they talk about is a beach resort in Europe called Greece which has nothing to do with us.

-          Hotel occupancy is up. What does this mean? It means business people are traveling again. They are traveling because they are selling something. They don’t travel to sell without companies asking for those sales, putting out proposal requests, etc. Things are moving.

-          Look at the statistics for fedex.com (using a site like compete.com). It’s up. It slipped a little when manufacturing dropped 15% in the summer in Japan because of the Earthquake but now it’s back up. This means things are being shipped. Goods are being sold. This doesn’t mean the economic statistics will be good for last quarter. It means it will be good for NEXT quarter.

-          Housing starts up huge. HUGE. The biggest since 2006. That means people will get hired again to BUILD houses. That’s a huge part of our economy.

-          Earnings are killing it. Intel is the bellwether for all technology. Technology has driven the market (for better or for worse) for fifteen years. Intel is killing it. This means people are buying computers and phones. Which means businesses are expanding. AAPL, one of the fastest growing companies, trades for just 8 times forward earnings and has $116 billion cash in the banks. These companies aren’t going bankrupt and demand is not going down for their products.

And let’s forget all about the basic economic statistics. Google is making cars that drive around on highways without drivers. MIT scientists are working on quantum computers. Every day there’s more evidence on how to diagnose and cure various cancers.

(this Google-made car has no driver)

We are a smart country, filled with innovators, and nobody comes even close. Sure, maybe China will get close to us by 2050 but that just means they will become our customers instead of just some random country selling us cheap goods.

Don’t be a pessimist and hold a sign up and get angry. The time for opportunity is here. Start planning for it.

You can say, “Well, what about the Eurozone?”

Let me tell you something about Greece:

Greece has only survived by the grace of its good friends since 40 BC. Julius Caesar supported it, other countries supported it, all the way through Ronald Reagan who supported it because of his terror of the Soviet Union. Since then, the Eurozone has supported it. So everyone since 40 BC has known that Greece is what it is: a beach resort on the Mediterranean. Nothing more, nothing less. They won’t make the next Google. And maybe they’ll pay down their debt, maybe not. And then China will support it. Who knows? But their issues, which have been known for 2000 years, will not bother us one bit.

Wow,that was a big answer. It’s almost a post by itself. I’m going to get some seaweed crackers before continuing onto the next questions.

 

HOW TO SURROUND YOURSELF WITH LIKE-MINDED PEOPLE

@kjepeneter asks: After I fix myself, how do I find others who are also “fixed”?

ANSWER:  The question is really asking: I’m healthy – now I want to meet other people who are healthy. Healthy not just physically but emotionally and in other ways.

The  answer is that you don’t have worry: when you are the beacon of light in the gray storm, the other boats that have survived will naturally come to you. This is a law of the universe. Like attracts like is a cliché because it works.

I have “met” better friends through this blog than just about through any other means in my life. For me, I wasn’t ready to meet good friends until recently. Now I am. And when you are ready, things happen.

What about a girlfriend, does it hold for that also?

Yes it does. The way I was able to meet the love of my life was when I made a conscious decision to be emotionally healthy: not get obsessed over anyone, not try too quickly for sex, not drink alcohol, but find someone who I really liked/loved and thought would be a good partner for the rest of my life. Someone who I could not only kiss but eventually die with.

More seaweed crackers now. I’m obsessed with these things. I can even hear Claudia doing yoga upstairs. But I don’t think seaweed is heavy enough for disqualifying me from doing yoga. I’ll catch up to her later.

IS IT TOO LATE TO ESCAPE FROM CORPORATE AMERICA OR AM I STUCK?

@GoldenStLiberty asks: Is it ever too late to escape from Corporate America? Even for a serious career change?

ANSWER: Absolutely not. In fact, if you are asking that question then you already know the answer.

Here’s the thing about “Corporate America”

-          Your boss usually sucks and someone eventually stabs you in the back. It’’s inevitable.

-          Fluorescent lights

(why are fluorescent lights so annoying?)

-          50% of your income is taxed

-          Between commuting and working its usually a 10-11 hour a day process

-          Your mind and creative abilities start to atrophy. And maybe you get out of shape.

-          And its NOT SAFE. We used to think that Corporate America met safe, rising jobs, promotions, salaries, life savings, etc. 2008 showed us that was all a lie. Heck, 100,000 people lost their life savings when GM went bust. GM was the most solid company in the world 20 years ago. So don’t count on any corporation to tuck you in bed at night and sing you a lullaby. Corporate America is not Mary Poppins, it’s the Exorcist.

So if you even have a semblance of desire to get out of it, you must start planning your exit. You don’t have to do it in a day. But set the forces in motion:

-          Start coming up with ideas about what else you can do. It might mean multiple streams of income  instead of just one. It might mean freelance. But get your idea muscle in motion. You need to exercise it because it ALREADY atrophied. 10 ideas a day for six months and write down what all the next steps of each idea are. Eventually you will be an idea machine. The corporation will get scared because they will see it on you. This has happened to me. They will keep promoting you and raising your salary because they will be afraid to lose you. But they have already lost you.

-          Wow, that was a big bullet point. I need another bullet point here just to point that out.

-          If you have to, get ready to downsize. You don’t need to live in NYC, forinstance, if you’re not going to be working at the big bank anymore. And cash is king. Don’t buy a house. Save your cash.

-          My own experience: I left corporate America working as a programmer at HBO in order to build a company making websites. It was brutal at first (see link). Then a few years later I had a job offer at a huge investment bank. NO WAY SUCKERS! I turned that down so I could have a miserable few years daytrading for hedge funds until I built Stockpickr.com. Not every day of “life on your own” will be a happy one. But the challenges will be different and you will be your own boss. And you might go broke. Who cares! At least you know you can do it again and again. Not everytime you have sex there are fireworks right over your house. But you still go back the next day and beg and plead for more (oh wait, maybe that’s just me).

[See also, "10 Reasons You Need to Quit Your Job Right Now"]

 

OCCUPY THE UNIVERSE PROTESTORS: FOR OR AGAINST?

@StealthAviator asks: “What’s up with the Wall St. protestors and now that it’s gone global? What is their objective?”

I answer this, more or less, every week. BUT, I’m going to be more definitive this week.

The Wall St Protestors are ANGRY. They are so angry it hurts. Let me tell you an example.

A good friend of mine has a credit score of 817. Which means he’s not only returned every penny he ever owed he probably gave the lenders even more money and said, “hey, go have a big party or something. I’m paying for it.” I’ve never even met someone with that credit score. To be honest, before I spoke to him (yesterday) I thought the top score was 800. But he says he has 817 so I believe him. He also made 300k last year. He wants to buy a house for 500k and put 30 or 40% down.

GUESS WHAT? THE BANKS WON’T LEND TO HIM

-          The banks have $1.6 trillion in cash

(there is a ton of cash in this economy)

-          The banks CEOs took home about a trillion in bonuses since the bailout.

And yet they won’t give my hardworking friend a loan so he can live in a house with his wife and three kids.

And that’s the cream of the crop. There are a thousand stories of foreclosures, layoffs, etc that are much worse. So people are angry. I get it.

But nothing the protestors do are going to change the banks. It’s like all the people who protested the Vietnam War at the Democratic Convention in 1968. Guess what! You won. Nixon got elected. You were protesting the wrong thing at the wrong place and towards the wrong people to get what you wanted accomplished.

The banks want to make money. They want to lend to people.

I can go two ways from here: personal or public.

I’ll do public first:

-          The Fed needs to stop PAYING THE BANKS to hold onto money. The Fed was so paranoid that the banks were going to lose all of their money that they started paying the banks 0.25% to hold onto their reserves. Why would the banks lend that out? The Fed should just get out of the way. Btw, the Fed is located in Washington DC.

-          Why did we give any bailouts without some restrictions on executive compensation. Btw, Congress and the President are in Washington DC.

-          There are 6mm private small businesses in the US. Instead of randomly printing money and giving it to the defense industry ($3 TRILLION already spent in Iraq and Afghanistan – two countries I still can’t find on a map if you had a gun to my head) why not do one single little stimulus that incentivizes each of these 6mm small businesses to hire one more person. BAM! Unemployment solved.

And now, more importantly, the personal:

-          Why are you so angry? Corporate America has ALWAYS SUCKED. Think how much better it is now than a century or so ago before child labor laws. Women garmentos would go on fire and the bosses would keep them locked in until everyone died. Children would work 80 hours a week for pennies. HECK, WE HAD SLAVES.

-          If you want to walk comfortably, you can’t cover the entire  world with leather. YOU PUT ON SNEAKERS.

-          Get my post out: The Nine Ways to Succeed (which really should becalled “TheNine Obstacles to Success”) and start following them. Start being grateful for what you have. Start being the smartest person in the room.

-          Plug all your leaks. Anger, even if justified, is a leak. I get scared also. I’m scared every day. I don’t want the world to end. I want to have opportunity for myself also, and my daughters, and their daughters. But that means I have to work at it. The banks will never give it to me. Eventually a boom will come again, like it always does, and the banks will throw money at all of us. But first, let’s get ready to take it and this time, let’s not lose it.

So what about those big CEOs who took the bailout money? Should they be put in jail? Who knows. Why did Washington DC give them that money? I don’t know anything. I’m only worried about what’s in my pocket right now. I don’t care about Obama(other than that I think we should Abolish the Presidency) and I don’t care about Lloyd Blankfein (other than that he didn’t return my email several years ago but that’s another story). I worry about what’s in my pocket, not yours and I trust will consistently do the wrong thing, like they always have.

WHO IS MY FAVORITE SUPERHERO?

@lakergod who is your favorite super hero and why?

ANSWER: Dr. Strange, of course. Not only is he the Sorcerer Supreme but he cleans up on women. I mean, look at Clea. And he has magical powers that can basically do anything: teleport, create exotic food fishes, heal people. He can also astral project, something  I’ve wanted to do since I was 12.

(Dr. Strange and Clea)

And he’s got a guy named Wong who is a master or martial arts  who is his assistant.

WHAT DID I DO TO MAKE MONEY AFTER I WENT BROKE?

@ScottEPowers asks: what did you do to make $ after you went broke?

ANSWER: Several things:

-          I downsized. I had to sell my house. I SEVERELY downsized. I went from a 4500 square foot penthouse to a 1400 square foot house 70 miles north and I cut my expenses by 75%

-          I had to get in shape. I worked out every day, I emotionally stopped dealing with people who were dragging me down, I made lists of ideas EVERY DAY, and I either meditated or read from various spiritiual or inspirational texts each day. I knew it was going to be a tough battle to climb back up so I did everything I could to prepare.

-          I immediately started writing about finance to generate income. Within a few months I had a book deal and I was writing for thestreet.comand The Financial Times.

-          I was daytrading and that was doing well back then (2002-5). I don’t think daytrading is practical now but it was then.

-          I started trading for hedge funds, then I started helping people sell their companies, then I started a fund of hedge funds.

-          Then I started stockpickr.com which I sold to thestreet.com. There was a six year period where nobody was paying my salary and I had to hustle for every dollar. But that proved to me that no matter how bad the economy gets, if you’re the one eyed man (the optimist) in the land of the blind (the pessimists) then you will find the ways to make money even if we are in a Depression.

BEST FICTION EVER

@importgenius asks: “I read non-fiction voraciously but want to read some more fiction. What novels could you recommend most highly?”

I used to be like that. But then I realized that most non-fiction writers have zero writing skills so it’s hard to actually get through one of their books. I really like fiction writers that have strong autobiographical voices so I can learn from not only their stories but the strength and quality of their literary voices. I’ve written about some of these before but I’ll add some more:

“Ham on Rye” by Charles Bukowski is THE novel of the 20th Century in my opinion.

“Jesus’ Son” by Denis Johnson is the best collection of short stories.

[See. "6 Things I Learned from Charles Bukowsi"]

“No one belongs here more than you” by Miranda July

“ Anything by Raymond Carver.

“Whores for Gloria” by Willliam Vollmann (or Rainbow Stories by him)

“I never liked you anyway”  a graphic novel by Chester Brown.

Start with those and you’ve started with the best fiction on the planet in history (in my opinion)

WHAT DO YOU DO WHEN YOU WAKE UP ANXIOUS?

@ScottVanEpps asks: I wake up every morning and am positive for about 30 seconds and then the tick list of everything negative creeps in, suggestion?

ANSWER: I do this also. Here’s what I do:

-          Label each thought: “useful”, “not useful”. Try to do that for as long as you can. I recommend this in “The Power of Negative Thinking”. You’ll find that a lot of those negative thoughts are “not useful” and you move on quickly. In fact, I just realized this second I was thinking of a not useful angry thought about something someone had sent me an email (usually the ones closest to you are the ones that know how to push your buttons) and I had to do the “not useful” thing a few times before continuing this answer.

-          Understand that most things you’ve ever worried about, didn’t come true. I’ve worried about stuff for the past 15 years at 3 in the morning. Almost everything I ever worried about didn’t come true, or had a solution long before it became a problem. If you stay in shape, do the daily practice, you’ll be able to fight the problems long before they come to fruitition.

-          Assume the worst case scenario. What happens then? Really picture it. I know it’sbad. But you’ll survive and move on. Sometimes the worst cases scenario is unimaginable. But if it doesn’t involve our own death, we usually can figure it out and move on and we’ll still laugh at a funny movie and the best we can to the people around us if they will still have us. And if they don’t, then we go on to new adventures.

[See, “I Woke  up Scared and Angry Today”]

 

DO I EVER SIMPLIFY COMPLEX IDEAS WHEN I WRITE POSTS?

@iAspin asks: “good afternoon Sir. Do ya ever struggle to simplify & structure complex ideas when writing books? What steps do u go thru?”

Yes, every single thing I right. In my last book, most of my ideas in the second half come from texts I’ve read that were written over 2000 years ago. I totally plagiarize them. But they are texts that have withstood the test of time and I know, when written with modern examples and modern language, that they will still resonate and people will still find Truth in how they can apply these principles in their own lives.

But if I were to just cut and paste them, they wouldn’t be useful at all. So I run them through the filter of what’s happened to me in my own life and how I’ve used these principles and it becomes much more accessible.

 

WHAT IS MY FAVORITE CHAPTER IN MY LATEST BOOK?

 

@ClaudiaYoga asks: “What is the favorite chapter in your last book?” [Here is the book. Or click above image. Or read this post to see special promotion I'm giving away with this book.]

Ok, she’s being sneaky. She’s my wife. Bad CLAUDIA! Now you force me to self-promote. And I even heard your giggling while you were typing that tweet so you AREN’T FOOLING ANYONE.

But it’s a good question. She knows people will think my book might be just a collection of blog posts and she wants me to always describe how it’s different.

In my blog I constantly recommend “The Daily Practice” to pick yourself up when you find yourself on the floor and are having trouble getting up and started again. IN this book, in the chapter, “What is True Happiness and Success” I provide a lot of modifications to that practice that’s not anywhere on the blog. Also, in the introduction I provide an overriding arc which suggests that the first step in success is acknowledging how much we’ve been brainwashed, who has brainwashed us, how do we get over the brainwashing, and then from there what are the steps needed to be truly happy with our lives. I think these are useful chapters. At least, they have been for me. As I say in the conclusion, “Don’t believe me. Try these things for yourself.” And then see what happens.

 

Next week I have to give a talk on Thursday in Scottsdale, Arizona. So no twitter Q&A but I’m back the week after. I really enjoy doing this. I’m really really grateful to anyone who asks a question. It makes me think and I hope it’s a little helpful.

 

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