Weekly Webinar #54: “The Basics of Passive Income”

could you elaborate?

I love it when I can comprehend a financial lecture. Thanks CRP.

We are not shorting. We are long a stock trying to squeeze shorts.

I love all of your financial lectures

OJ

Question: Assuming for a moment a significant reversal in the market. Won’t specific enterprises in strategic industries do well regardless of the rest of the economy? So picking good companies in emerging markets/industries will still work? Yes - No, what am I missing?

Shorting the market? There is a way to short the market and not be on the hook for unlimited losses. Short the market and NOT a specific stock. Which is what the gamestop (?) short play was all about. * The market could go UP for months to come. Makes betting on a short very difficult. Right?

A short squeeze opportunity with $GTII TLDR: A OTC stock (I know I know OTC companies are complete crap) has an opportunity for a short squeeze. Why? The company has been attacked by Naked shorts (not normal shorting). What is shorting? Instead of buying a stock and selling it at a higher price, you sell high and buy back later at a lower price. Instead of buy low/sell high, it is sell high/buy low. Basically the sale of the stock comes first instead of buying it. What is the mechanism that allows for this? Don't you have to own a stock before you sell it? Yes, you need to own a stock before you sell it. To get around this obvious issue you borrow the stock from someone else. This borrowing of stock is not free, however. You are charged interest stock while you hold it. (Nobody is that nice :) ) What is naked shorting? It is performing a short without locating the stock to borrow before hand. Please watch this video to understand how naked shorting is carried out: https://www.youtube.com/watch?v=qtkaMx12otQ What does this have to do with an opportunity to make lots of money on a crappy stock? There is a way to kill off shorts on a stock when it is heavily shorted. DIVIDENDS Why do dividends hurt shorts? Lets do a thought experiment. Suppose that we have a company XYZ. Suppose that we have Short Seller named "A". Suppose that we have a Broker "B". Suppose we have a buyer of XYZ named "C" Suppose that Short Seller A decides to short XYZ stock. So this means that Short Seller A borrows a share from Broker B. Suppose that Short Seller A sells the stock to buyer C. Let's think about what happens when XYZ company issues a dividend. Problem: Who receives the dividend? Buyer C bought the stock so he deserves the dividend right? But what about Broker B? Broker B technically owns a share, but it is just being rented out by short seller A. Broker B wants the dividend still. How is this balanced? Short Seller A is REQUIRED to pay the dividend of the broker. So issuing a dividends will force a short to pay out a dividend on each share of the company. Okay this makes sense, but if this works why haven't other companies tried this? Actually, other companies have tried this. Namely Overstock https://www.marketwatch.com/story/overstock-founder-tried-to-squeeze-short-sellers-then-sold-out-when-the-sec-cracked-down-2019-09-19 Why hasn't $GTTI done this yet? They have in the form of 10-1 distribution of warrants with a strike price of $2.75 (kind of like a call option you excercise when it is in the money (above $2.75)). This has caused the price to go from $0.10 to $4.00. Wasn't the 40x price increase the squeeze? This was from normal shorts covering NOT naked shorts covering. How do we get naked shorts to cover? This is where it gets interesting. Right now warrants are being distributed to each of the owners of $GTII who had stocks that were settled by April 1 (which means if you bought buy March 30th). The DTCC did a count of all shares that the public owns (not naked shorts or IOUs). Because there is a large number of naked shorts in circulation the number of shares people versus the DTCC has counted is estimated to be a difference of 50,000,000 Note: Brokers will not openly confess that this gap between the number registered at the DTCC and the number in the broker's books are vastly different as that would mean they are participating in fraud (and they would rather not have to deal with this). But we can force that number out of the brokers via warrants. How? The company will not distribute more warrants than they have to. So when distributing the warrant to brokers the broker will ask for more warrants they should have. This means that the number of shares for the Broker will exceed the count that the DTCC has on their books. This means the Broker has IOUs and will NOT be able to deliver the warrants and will be utterly screwed. The second consequence is that it will be publicly known that Broker does not have settled shares and will ask the Naked short to settle their trade since they do not want to be on the hook for paying the dividend themselves. At that point the naked short seller would go bankrupt. At that point the broker would go to the primer broker and give them the bill. The prime broker will go buy shares to covered the unsettled transactions at MARKET value causing the price to sky rocket. To give you perspective, when the price of the stock exploded to $4.00 is only with 1 million volume. (40x multiplier) With a 30,000,000 buy order and primer brokers racing to front run each other to cover the unsettled trades this could very well be the craziest short squeeze to date. There is so much more I could talk about, but I will point you guys here: https://www.reddit.com/r/GTII/ The price is under $3.00 and it might just explode way harder than $GME so I would highly recommend that if you have money to throw away to check out this 1 in a lifetime opportunity. Thanks!

This can be a potential 100 bagger play by the end of the month. Even if you don't want to invest just keep this on your watchlist and see if I am right.

Great webinar! Someone has alluded to the decentralized finance and lending in the crypto space. That can actually be a decent way of making passive income through the process known as staking. This is basically earning APR on the crypto that you own and temporarily “lock” for lending. The APR rates can vary from 3-12% depending on the crypto you are staking. Some crypto projects also allow you to buy mining nodes that will pay you for supporting the network, some with minimal computing power. I am making roughly $5000 a month running nodes for the Gala network with is a blockchain gaming company. My initial investment was $20,000, and I’m more than half way at recouping this investment after just two months. This is of course risky and highly depends on the strength of the crypto market. One small point on the China / Russia invasions, while I do see China invading Taiwan and getting away with it, Russia is not going to make a move in Ukraine. You gotta remember that the point of the 2014 Russian invasion was to prevent Ukraine from joining NATO by creating a territorial dispute and a smoldering military conflict. They are not interested nor are they able to take over large parts of Ukraine. And the US doesn’t need to go to war, all they need to do is cut off Russia from the SWIFT network and overnight the Russian economy would be in the Middle Ages, and Russia knows this. So you can sleep easy Coach! :)

Normally you will not get a loan without some credit history. Easy to start. You Go to a bank, ask for a secured CC. You will need to deposit some money in a savings account. The new CC is secured by your savings account. Use CC for a year. Always pay on time. After a year go back to bank, get a new 'regular' CC, close the secured CC. Over time your lending worthyness will grow ~ if you pay on time and don't have any hick-ups. This is very common in USA. Good Luck

Excellent. You cover a lot to territory.

When talking about stocks, have a lot at commodities. Almost all of them broke/are breaking year-long chart pattern. The sector is highly undervalued. Have a look at the ratios between e. g. gold and the Dow Jones, Nasdaq, etc. Many big mining companies started to pay dividends. Even if the market crashes, this would be merely a short event (=buying opportunity) and wouldn't change the fundamentals at all. We are running into severe supply issues with copper, uranium, tin, lithium, nickel, etc. As a geologist, I think that we will see a commodities bullmarket for the next ~10 years, like in the early 2000s. If you are young and into stocks, have a look at this sector now and back then to know what could happen again. Great video coach!

Hey Coach, I need to start getting into these webinars. I had a question on the topic of finances. This might be a very basic question and have never heard anyone really talk about it. I am 23 and I have never had a credit card. Am I being foolish not building credit ? Is having a credit card nessasary for loans ? Thanks for all your content Gonzalo ! Really great topics.

CRP, don't forget to take of your health. We all care about you.

Great fucking webinar. Already have the fu money and Was getting depressed as hell with nothing to do and was just going through this. And was thinking maybe needed to quit my job but will just keep it and get more rentals. Thank you crp. Its exactly what i needed to hear

The first investment you should make is in yourself. Learn from guys like coach, read every day: Business, investments, entrepreneurship, etc... take some online courses and if possible "model" someone that has already achieved what you want. Just follow their "recipe" and you will avoid a lot of mistakes, wasted time and money.

Why bother paying down property that you rent out? as long as you have a manageable loan such as 50% equity in the property just do interest only mortgage. In business you never pay down loans and always go with interest only. Its only your main residence that you pay a mortgage off, it makes no sense with rental houses as over the loan, it diminishes with inflation as prices rise and rents rise

Fidget spinner lesson; I let go of a cheap domain name that’s now worth $50,000

Please warn me if I am shilling, but check out some of the DD from some of the autists on reddit.com/r/GTII we have a short squeeze play.

Love the new intro music.

Awesome. Was just spending a week trying to figure this topic out. As i have enough saved and thinking to quit my job.

One of your best webinars