Joe Shew of Crypto Consulting Institute on Crypto Clothesline Podcast
Our guest this week is Joe Shew, also known as Crypto Joe.
At the age of 8 he started his first business. At 12 he was investing in the stock market. Learning from his father who had invested in real estate yet was working 3 jobs to support his family in London, Joe sensed there had to be another way to reach financial freedom, without compromising health and family time.
All of this led to a successful career in finance and yet even then he noted the long hours on the job and started looking at alternative markets and cryptocurrency.
“…given my finance background and my passion in that area paired with the high growth opportunities, it was perfect for me to move into that space and later on start teaching people as well.”
Education and Balance
Joe is all about educating his students about balancing out or having a diversified portfolio.
“A portfolio is something is where you’re holding and controlling your assets and to diversify pretty much means to invest in different areas to offset risk.”
If we were to hold all our cryptocurrency in Bitcoin for example, not researching and investing in other altcoins, then all your money, and the calculated risk of the investment of choice, sits in just one place.
“If you invested in a few different coins, then you are averaging out that risk.”
“In terms of investing into foreign currencies or gold or property, to grow assets, there are different ways that you can offset your risk.”
Gold Is A Hedge Against The US Dollar
“Hedging is a way, again, to minimise your risk against something else. It is splitting away rather than being all-in, in one specific area.”
The idea being that if one market’s up, potentially the other market’s down. The US dollar crashes, gold prices spike. Silver is usually close behind.
“If we think about US dollars and Australian dollars, there’s quantitative easing, which basically means printing money.”
The more cash notes there are being printed and generated in the community, the less value, less buying power our original dollar has. The more cash we need to spend for the same item as our cash is now devalued.
Our incomes do not grow in accordance with the reduction of value of our dollars, so we end up paying more from our existing income for goods and services we need to survive, while getting the same, or marginally more money from our jobs.
The tighter and tighter things get in the family budget, the less and less things we can afford to purchase, and so the economy slows down, and many small businesses go bust.
Meanwhile we trust the banks to keep us and our precious loot safe. Just look at the recent
Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry in Australia to see how well that worked out…
“So that’s why people start holding things like gold and silver and Bitcoin. Effectively it’s a digital version of gold…”
Real Estate – the Ball and Chain or the Key to the Future?
We discussed the question of real estate and whether it’s at the ‘right’ point in the cycle to be buying property as an asset class.
Joe agreed it was a viable option but distinguished between old and new wealth.
If you come from old wealth, and your family have held assets like real estate for some time, you’re hardly going to sniff at it. You hang in there, collect the rent and wait for things to swing around again – or perhaps borrow against the equity and use that cash for some other investments.
But if you’re wondering whether to save $200 000 as a deposit on an average-sized home which you’ll be paying off for the rest of your working life, then think again… that same money will potentially render much more to you in this lifetime, even in the next 10 years, if you make some clever, long-sighted decisions into other asset classes. (This is NOT financial advice and IS the product of an interesting conversation we all had.)
Even if the market is low, you might buy a property at a really cheap price, but you’re going to have to hold onto it for maybe 20, 30 or 40 years before you realise any real developments or any real sort of increase in value, on that $200 K.
You need to think: who is going to buy or rent your property?
Currently the Gen Xs, that demographic of the working population (birth years ranging from the early-to-mid 1960s to the early 1980s) is sandwiched between the Baby Boomers who are/were much more cashed up than their children at the same age, and the Gen Ys who are, generally speaking, the Gen Xs children.
Gen Ys couldn’t give a flying about working their lives away. They don’t base their life yearnings on the traditions of their parents and grandparents. Born into a digital age, it’s easy, happy now for most of this generation. It’s going to be a relatively long time before the Gen Ys have got kids and they’re going to be looking to buy property to settle down.
So… you’re going to have to hold that property without mortgaged access to that $200 K until there’s a demand for buying properties again from the maturing Gen Ys.
The idea is to use your money in other ways, as opposed to tying yourself down with a mortgage and negative gearing and all those other nasty pasty aspects, for the next 20 to 30 years.
“What I would say is there are opportunities to create greater amounts of wealth than we’ve ever seen before in different markets.”
Anyone for a Spot of Risk?
Getting involved in the crypto market depends on your appetite for risk. People have made an extraordinary return on their crypto investments, but many have lost a lot too.
“It’s all about being proactive and understanding what different investment vehicles I can look into right now…
“It’s the quality of the questions that you are asking that define your reality right now and your future…”
What About Debt?
Is debt good or bad? Does debt help us get ahead (getting a ‘knee-up’ form the bank) or is it their (banking and government institutions’) tool to keep us tied and slaves to deadening mortgages?
(la morte in Italian = death)
An important thing to question if we’re looking at money and financial health is that most people are carrying such incarcerating levels of debt that they can’t actually really step out and make a difference in their lives. Either as a result of credit card debt or mortgages, people are stuck. Many feel they can’t get out, even if they wanted to.
Joe agrees that banks over-leveraging and attracting people into deeper and deeper credit card and mortgage debt, is not good.
“We’ve been conditioned to give banks credibility and to believe they have our best interests…”
But he counters that learning how to use debt, and the bank’s funds, can mean a very different, positive outcome.
“When you do understand how to use debt effectively and when you can leverage upon it to maybe offset and write off some of your other assets, [it can be a useful tool] and it can be very important for growth of a business or investments in certain areas…”
The fact that banks have moved the focus to credit cards, shows they are looking at new ways to increase revenue from us, their clients:
“Anyone can go into a bank now, get a credit card, and they’ll probably give you a 7 to 10K limit on that, knowing that you’re not going to be in a position to repay it.
“And then people will spend their lives doing balance transfers… or they don’t even know about that, because we’re not taught financial education in school.”
The education system that we’re enmeshed in was rolled out for the industrial era. And it hasn’t really revolutionised since.
“If you were taught from a governing body, [they’re] going to teach you what they want you to be teaching others, right? So that you don’t look outside of the box.”
There’s actually an amazing video called Requiem for the American Dream featuring long-form interviews with Noam Chomsky(American linguist, philosopher, cognitive scientist, historian, political activist, and social critic) that speaks at length about this conditioning and lack of meaningful education.
“I think for most people, especially in the world of cryptocurrencies… there are people who are futurists and they think differently. They don’t accept the status quo. They don’t accept this is how it should be. They find how they believe it should be.”
What Would You Say Money Is, Joe?
“Money is the unquestioned belief that something has value. Money is a concept in itself and then you have currency which represents it. It’s a way of storing value.”
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Disclaimer: We are not financial advisors and we chat in general terms which should NEVER be taken as financial advice. You must always do your own research (DYOR) before investing in ANYTHING not just cryptocurrency.