SPEAKER_00 0:00

And we're not talking about we're not talking about exceptions to the tax code. We're not talking about anything illegal. What we're talking about is written right in the tax code. So we're taking advantage of the tax code as it is written.

SPEAKER_01 0:16

Exactly.

SPEAKER_00 0:17

So life insurance has exceptions and is treated exceptionally well inside the tax code. So we are taking advantage of that. And we're not deferring our tax, we're actually reducing it ultimately.

SPEAKER_02 0:36

And for we have that ability. And for a good reason, George, because I, you know, those in power, those in the know, they use this instrument to pass wealth to the next generation. Absolutely. Absolutely. The wealthy have been doing this for hundreds of years, right? Welcome everybody. Welcome back to the Sovereign Capitalist Podcast. Uh, we are here again with our friend George Roth, and I'm Jose Atencio, and today we are going to be talking about the perfect investment. And I would say quote unquote investment in this case. So when you guys think about the perfect investment, what is the first thing that comes to mind? You know, when I first when I first heard this term, I was like, hmm, perfect investment. What does that even mean? Is that even possible? And I was shocked to see that um there is actually it is actually possible to have something as close as possible to perfection when we call when we talk about an investment. Uh, and we have identified several uh characteristics that this that this investment, quote unquote investment has. And those are powerful characteristics that can significantly change the financial, economical outlook of any individual, any family that chooses to leverage this investment. But let me start by explaining the problem that this perfect investment addresses. And the core of that problem, the root of that problem, is basically two things. The first thing is that boom and bust cycle and how the Canadian financial system, and I would say even the whole Western financial system, is exposed to the boom and bust cycle, and that boom and bust cycle is sponsored by none other than the central bankers and the central banks in conjunction with what we call the banking cartels. And here in Canada, we are basically held hostage by five to six banks who hold the 95% of the deposits, and we have we have touched upon that in another episode. Uh, that's one thing. Now, the second thing is that the traditional financial advice here in North America uh pushes everybody to flee into high speculative investments and basically to expose your savings to large amounts of risk. And a lot of the times we are told that this is just a natural response to a financial system that continuously devalues our currency through monetary inflation, and monetary inflation is just the creation of new money through that central bank enabled by the commercial bankers. So, George, would you like to expand on those two for the audience?

SPEAKER_00 4:19

Yeah, I mean, we know what we know, we don't know what we don't know, right? So, who teaches us about money and about finances and and what we should and shouldn't do? So if it's not our parents and it's not the government, we don't learn it at school, and the banks are not going to teach you, they're only gonna sell you their products. So, how do you learn what you should and shouldn't do financially? So traditionally, typically, um I like to say typically because traditionally, believe it or not, participating whole life was a traditional savings tool. 50s and 60s, it was the number one tool. That's correct. Um and then it fell out of favor. So the typical advice is speculation, chasing returns. Right? Put your money, you know, risk versus reward. You're not gonna get any reward if you don't take some risk. But it doesn't have to be that way. So that is the typical way, that is the typical advice, and and most people follow that because that's all they know. Yeah, and and and you know what, and if you you don't know what you don't know, right? So our job, our role, our mission is to educate people so that they know that there is another way, a better way. And you don't have to put your finances at risk.

SPEAKER_02 5:48

And when you when you buy into that speculative system, basically you are at the same time, without even knowing, you are limiting your ability to build capital. Because you're losing control. Yes, and we explain in another episode the seven traits of capital, and a huge one is that control. So you can't do both at the same time unless you become owner of one of those perfect quote unquote investment vehicles, basically. So, George, there's something that I call the mainstream lie, and that is how the financial narrative, and we said that like how everything is built around the lie that you must sacrifice or get guaranteed returns and control for the potential of a high growth. That's number one, and number two in that system it's the hidden tax off inflation, and it's funny because I was talking to a couple of people in the streets asking them, Hey, do you know how the government makes money? And they always say taxes, taxes, um, but they never like I I spoke to like 50 people, and I was asking them, hey, do you know how the government gets their funding? And everybody said taxes. And I say, I'm there saying, Man, that's not enough. Like, have you have you even checked? Like, do you know what a deficit is? Do you know what a the budget is? Do you know what the fiscal policy means? All that stuff. Um Canadians don't know, but apart from taxes, there just another way the government gets money is by just inflating the the uh money supply. And that's the creation of currency through the Bank of Canada and the commercial bankers. And a perfect investment has to be able to keep up with that, be quote unquote inflation proof, um, and also provide you with other benefits as well. So those two things are two key aspects that the perfect investment um addresses.

SPEAKER_00 8:51

And um yeah, you definitely want a good return on your money, so you want competitive, consistent, safe, secure returns on your money. You don't have to give up the guarantees to get that. So the perfect investment in my mind, and we we use that term investment very loosely, um, because we're not actually investing. But nevertheless, the perfect investment would involve competitive returns consistently with guarantees. And then people say, well, how can you get both? Well, you can get both. It is possible. This is this is exactly what we're we're trying to tell people that it is possible. Um you don't have to give up guarantees and and control to get a return on your money. So that's that's important. And in and when we talk about inflation, so the perfect investment would maintain a consistent, stable, non-increasing cost. So the cost never goes up. So once the price point is locked in, it can never go up for the rest of your life. So inflation is costs going up over time. Well, what we're saying is the cost will not go up over time, but the value will guaranteed go up. So where do you find this perfect investment that has no increase in cost, but a guaranteed increase in value? Yeah, that sounds like And that is anti, that is that is that is inflation proofing your money, right? Inherently. Um and you're also putting in future dollars, which are weaker. You're getting weaker dollars in the future as well, but you're gonna get more of them. So that growth has to has to beat inflation, right? So every investment has to beat inflation, or you're not gonna actually truly increase the value.

SPEAKER_02 11:22

Yeah, so you're also talking about volume. So that's important. You're talking not only like you're not talking about rate, you're talking about the volume of the interest that this investment will generate for you. Yes.

SPEAKER_00 11:38

So the value must always go up, and the cost never goes up. So you're right there, you're beating inflation. Absolutely. There's nowhere else where that happens, right? A lot of people will say, well, real estate um protects you against inflation, gold and silver can protect you against inflation, but the costs and the value of those things go up and down. Right. They're not constant, they go up and down. So you still have to time the market no matter what you do. Right. And the cost of your mortgage can go up because when you renew every five years or however many years, is the cost going to go up or is the cost going to go down?

SPEAKER_02 12:22

Yeah.

SPEAKER_00 12:22

You are at the expense of the value gonna go up? Yeah. That's right. And is the value gonna go up? Is the value gonna go down? So um in order to beat inflation and to inflation proof your money, you have to have an asset that doesn't go up in cost, but it always goes up in value.

SPEAKER_02 12:41

Yes, and you know, you mentioned gold, silver, and real estate, and you know, and those are great uh hedges for inflation and volatility and great store of value for sure. Now the issue is how do you properly leverage that capital? The capital that's stored inside of those, how do you properly leverage that? I mean, you can do that in case of real estate, you can do home equity lines of credit and and leverage that. But yeah, but again, you're doing business with the banks, and uh, you know, that's their home equity line of credit. You have to go through an application, you have to go um and even you will have to subscribe to the terms of that e-lock and play by the rules that the banker will will tell you. Um in the case of gold and silver, for example, like I was there's a credit union here in Alberta that offers uh credit lines secured by gold and silver, and uh they only lend you 40% of your gold and silver value, not more. So again, are you able to leverage a huge portion of your capital? No, right?

SPEAKER_00 14:15

Uh again, because it's it's based on an asset that goes up and down in value.

SPEAKER_02 14:21

Exactly.

SPEAKER_00 14:22

It's not based on an asset that can only go up. Yes, with guarantees. That's the difference, right?

SPEAKER_02 14:28

Exactly. So you can see for you guys listening to become a sovereign capitalist. A sovereign capitalist needs to value that control on top of everything, and in that case, opportunities will start chasing you down. The only thing you will have to let go of is that market volatility, and in my book, that's a great thing to let go of. Unless you're like a trading junkie or something, like because there's people that love that thrill. But if you want to build sustainable, predictable wealth, this is just the the best way of achieving that for sure.

SPEAKER_00 15:29

I think the next the next trap is is the control trap, right? So we are people are convinced that they should give their money to someone else to manage it, uh, you know, with whether it's through an RSP or a TFSA or or any kind of a mutual fund, doesn't even matter. You're giving your money to someone else for the for them to manage, and then they charge you fees, and your money can go up, it can go down, and you're losing control, right? You've lost control of your money. And then there's the liquidity aspect. So how do you use that money when it's locked away in prison? Well, you can't. Because if you take it out, now it's you're losing its ability to grow. So that's an opportunity cost, and you're interrupting the compounding. So you're hurting yourself if you want to use your own money. Correct. Or to be successful, it has to be long-term and you can't interrupt the compounding, right? So when people predict, you know, you put this much money away and it's gonna earn this much per year, and in 50 years you're gonna have this much money. Well, that's a fallacy. That's there's no way that that's gonna be what happens, right? You have you know, you have to be consistent in putting your money away. Your returns have to be positive and consistent, and you have to leave it there for 50 years.

SPEAKER_02 17:01

Which is, hey, don't don't say that lightly, because that that's the biggest part. Leave that there for 50 years, for 30 years. You are introducing the human factor into the equation, and that is you know, the the biggest danger to you building capital or growing investments, it's a human factor. It has to be 100%. Like we can create very nice illustrations, do projections and all that, but if you don't overcome um the arrival syndrome, for example, then it you know the odds are stacked against you, absolutely.

SPEAKER_00 17:53

We've talked about some of these attributes. Um, you know, we want consistent, solid, consistent returns, we want guarantees, we want to beat inflation, we want to inflation proof it, we want liquidity, we want control. We also want tax benefits. So, what is the number one reason why people use registered plans and tax-free savings accounts? Because the idea, the concept is that you're gonna save taxes or defer your taxes. Um Well, people don't even know what defer means.

SPEAKER_02 18:35

It's yeah, yeah. It's like every everybody thinks they're saving taxes.

SPEAKER_00 18:41

So what we're saying is we don't want to defer taxes. What we want to do is stay away from taxes, reduce, remove, um, have tax-free growth, have the ability to use your money tax-free, and to leave a legacy for the next generation tax-free. So if we can take advantage of all of those things, why wouldn't we?

SPEAKER_02 19:10

And you mentioned that in one of the previous episodes. Tax, would you rather take a tax on your seeds or a tax on your harvest? Yes. So this is where it comes. Yes, right? Like uh, and and it's about saving on taxes, it's about being smart about it. And um if I can pay my taxes today, uh we'll pay my taxes today on that money to just free that money up and go do amazing things with it, and uh, and then I don't have to care about you know having the CRA as my business partner for the rest of my life, essentially.

SPEAKER_00 19:51

And we're not talking about we're not talking about exceptions to the tax code, we're not talking about um anything illegal, right? What we're talking about is written right in the tax code. So we're taking advantage of the tax code as it is written.

SPEAKER_01 20:10

Exactly.

SPEAKER_00 20:11

So life insurance has exceptions and is treated exceptionally well inside the tax code. So we are taking advantage of that.

SPEAKER_02 20:23

And we're not deferring our tax, we're actually reducing it ultimately for a good reason, George, because uh, you know, those in power, those in the know, they use this instrument to pass wealth to the next generation. Absolutely, absolutely the wealthy have been doing this for hundreds of years, right? Uh, like even you know, the bankers, there's banked-owned life insurance, B-O-L-I. You guys can research that. Okay. Uh, a lot of the retirement plans for those executives, those retirement plans are built into insurance policies of this sort because they know there's just no very better vehicle to that that can that can perform all of this at the same time. Now, you mentioned, George, you know, uh the safety um characteristics of this investment, quote unquote investment. I want to talk about the uh control characteristics of this investment, that liquidity, that creditor protection, that privacy. You know, when we talk about liquidity, it's always accessible to you. And there's no questions asked. You just want to access that money, you don't need to explain why. Uh, you don't need to provide proof of employment, you don't need to provide the last two pay stuff. You don't need to provide a good credit score. Nobody's going to check your credit record. None of that. None of that nonsense. I was just talking to a client and he was saying, Hey, I will have to, I'm going to have to give the down payment for a house pretty soon, but they have very strict uh numbers on uh you know the the debt to income ratio and how much they will be able to to give me. And I'm thinking, well, if I if I take that policy loan to give the down payment, then that's gonna lower my my whatever the the bank will be able to lend for the mortgage. And I'm there saying, man, I was just waiting for you to to ask that question again because I I did I did tell him before how that works, and he was ecstatic to know that this has nothing to do uh with the the traditional uh lending setting at all. Um it's it's just it's seen as cash basically.

SPEAKER_00 23:06

That's right. It doesn't show up on your credit report, it doesn't show up as a negative, it you know, it doesn't impact your ratios. Uh it's a private, it's private between you and the insurance company. So, and that's huge. That's huge. So this is how you have control because you can dictate the terms and conditions of the use of your money. And in actual fact, what we're doing is we're leveraging our money and we're using the life insurance company's money. Um, and I think it's important also to talk about what that means using the life insurance company's money versus a bank's money. Because what do banks do? Banks fractionalize the money, they print money, and they create inflation.

SPEAKER_01 23:58

Okay.

SPEAKER_00 23:59

The whole system is creating inflation. And the insurance industry cannot inflate the money, they do not fractionalize the money, they must have the capital, they must back up all their money with actual capital, more than a hundred percent, right? So there's rules and regulations that they must follow. Highly, highly regulated. They have to be overcapitalized. So every every bit of our of our money, our currency, is backed by an asset that has value inside of the insurance company ultimately is growing in value, right? Um, and the insurance company is guaranteeing that asset that we're using as leverage. Think about that. They are guaranteeing the collateral that we are using to finance our lines.

SPEAKER_02 25:01

The lender guarantees the loan.

SPEAKER_00 25:03

The lender is guaranteeing the loan. Yeah, I don't I don't know you have to give that some thoughts. Yeah, yeah, yeah.

SPEAKER_02 25:10

Because it's like now the other thing about that. Yeah, now the other thing uh with with what you said is that for the audience, are you essentially saying that whenever you go into a bank and ask for any sort of loan, are you saying that that bank is creating that money out of thin air?

unknown 25:38

Yeah.

SPEAKER_02 25:39

Okay. Essentially. Okay. Now, if they are creating the money out of thin air, that is new money into the market, and isn't that money also raising the prices when I go to Costco?

SPEAKER_00 25:57

Yeah, technically, what's happening is the the the value of a good and sir, a good or service is not going up. So the value of what we're buying is not going up. What's happening is the value of the dollars that we're using are going down. So we now need more of those dollars to buy the same goods and services, not because they're more valuable, but because our dollars are less valuable.

SPEAKER_02 26:24

Because they're more in circulation.

SPEAKER_00 26:27

Correct. And because and and yeah, we're talking trillions of dollars, right? Um so I mean you look at you look at our government, any government with a central bank is creating money whenever they need it.

SPEAKER_02 26:45

So, George, you're saying that not only the government is creating the money whenever they need it, but even when I go and ask for a loan, I'm also part of the problem.

SPEAKER_00 26:58

Yeah. Because that money didn't exist, right? Until you sign on the dotted line, that money doesn't exist. But as soon as you sign, that money exists. Now, they have to balance the books. They create, they, you know, there's a a debit and a credit. So, you know, what we consider as a debt, they consider an asset. What we consider assets, they consider debts. So our deposits are debts to the bank. Our loans are assets to the bank. So they have to balance their books and they do that. But that money didn't exist before you went you went there. Right? You've now created that money, um, and it's fractionalized, so the money doesn't have to actually be in their vault. Right? It's just a number on a computer screen that wasn't there before. So there's more and more and more dollars that are being put into the system and they have less and less value.

SPEAKER_02 27:57

Is that the same money I had to trade my time for? And they just create that out of thin air. Are you also saying that they're stealing my life? Because if I had to trade my life for those same dollars, and they are able to create them out of thin air, hold on a minute, like how does that work? They're essentially stealing my time because not only that, but uh whatever I'm saving or whatever I'm earning, every time they print new money, whatever I have earned, which I traded my time for, it's now worth less. So they're stealing my time, so therefore I can also say that they're stealing my life. Okay.

SPEAKER_00 28:53

You could you could say that. And I mean, I mean, if we think think about governments and deficits. How does a government run a deficit? How can you spend more money than you have? Well, they're because they're they're they're just creating it. Right? Yeah.

SPEAKER_02 29:15

Um what happens if you try to do that? If you try you can't. Wow. Okay.

SPEAKER_00 29:28

So So this is the system. Well, and what we're saying is we we as individuals, as families, as business owners, can do things differently, remove ourselves from that system, create our own privatized financing system that gives us all of the attributes of the perfect investment, all the attributes of capital, true capital, you know, that we've talked about and will continue to talk about. We can now become part of the solution instead of being contributing to the problem. And we can do that by becoming our own privatized bankers. We take over that function in our lives. And we use the insurance industry to do that because it's a non-inflationary, overcapitalized industry. The opposite of the banking system.

SPEAKER_02 30:38

Yeah, and they they hate risk, they hate speculation, they they doesn't work for them. Right? As a matter of fact, uh where when the banks want to uh keep their money safe, uh it's going to an insurance company.

SPEAKER_00 30:55

Absolutely. And I mean, what what is the number one job? What is the number one mission of an insurance company? Uh buy risk, uh manage risk. It's managing, it's managing risk. Absolutely correct. That's that's all they do. They manage risk. That is their that is their mission, that is their life, that is what they do every single day of every year. They manage risk, and they've been doing it for hundreds of years, and they're pretty darn good at it. And they think long term, they don't think short term, right? So they're not concerned about the quarterly earnings, they're not concerned about um, you know, return to our investors, our shareholders. They're not concerned about that. So they can think long term, they can plan long term, they can smooth out the results over time so that they give consistent guaranteed value for our for our dollar. And and so that's how it works. And it's and it's it's it's inherent to the system, right? When you talk about two opposite systems, which one do you want to be in?

SPEAKER_02 32:11

Yeah. Now now, George, think about this. What if ten percent of Canadians adopt this system? How would the Canadian economy look like? How would the banking system look like if we have 4.5 million Canadians doing this? You know, knowing knowing all this, everything that we just discussed, understanding how the Bank of Canada is stealing your future and your family's future, how they are basically stealing your time by creating money out of thin air. If 10% of Canadians understood that and implemented this concept, effectively succeeding from that system, that evil system, how would things look like? Like this could be this could spark a financial revolution where we could get we would we could we will take the conversation to Ottawa directly and where people will not accept a deficit anymore, for example. Like people will say, well, no, you're not creating a deficit this year, you better balance that budget or you're out. Simple as that. And that to me, in my opinion, that's way more powerful uh than just voting a federal election. Like if you go and vote with your wallet and start doing this, this is hitting them where it hurts and taking back control to the family, to the individual, to the business owner. Now imagine well, so what sort of uh alternative banking systems we'll have where we could have, for example, a co-op of, and I'm throwing ideas out there. We could have a co-op of a hundred people, a thousand people, all practicing IBC, storing wealth inside of these policies, and just providing lending services to third parties. And and those are non-inflationary loans that these people are gonna get because they're all coming from this system. Like that sort of thing is possible, it's within the realm of uh of possibilities, but it starts by changing your mind, rethinking your thinking, and and and really evaluating your life choices.

SPEAKER_00 34:45

Um because I'll say each of us individually, one by one, seceding from the current system, absolutely, and we're looking for that 10% tipping point, right?

SPEAKER_02 34:56

And and that's and that's what we're doing. That's our goal here, and that's our mission, and uh that's that's what every one of you it's part of. When you are part of a service, you become part of that 10% with active resistance.

SPEAKER_00 35:14

So think think about this. So one of the insurance companies that we deal with is mutually owned. There's more than one in Canada, but one in particular I'm thinking of. Mutually owned. So, what does that mean? That means that you and I, as policy owners, are the shareholders of that company. So consider that. Consider that you, at when you are in you're putting your money into this system, which is yours, that you own and control, and you're you're you're using the insurance company's money and you're using their ability to create and grow and store capital and protect capital, their only goal, their only mission is to give back to us, the owners. So everything they do, everything they do in every business line is about creating profit and giving it all back to the policy owners who are the shareholders of the company. Yeah, no one else. Yeah, we are the owners. We we are the shareholders, we are the owners of a mute, so we mutually own an insurance company. Think about that. And all they do is to contribute to us, that's their only mission. Yeah, I was so I mean that that's amazing.

SPEAKER_02 36:48

Well, let me add, I was talking to an employee from that company the other day, and she told me uh, she told me, well, we don't have the budget that other insurance companies have for to to throw parties, for example, or to send uh their advisors to the Caribbean, for example, or to have fancy dinners with 10 advisors at the same time. We don't do any of that because everything we do is gonna impact the dividends and the performance of those policies. And I was like, whoa, okay. I mean, I I love that. I I love that idea, and I wish all insurance companies were like that, but you know, that's what that's why we also need to understand, and that's what we do here. Like we go and make sure that we, whenever we are creating this personal privatized banking systems, that we do this with the right company that also shares this vision right here. Yeah.

SPEAKER_00 38:01

So and I mean it doesn't, it we're not, we're not limited to one company for sure. Like we don't want to give the wrong impression, but um because many companies this works with many companies.

SPEAKER_02 38:15

No, yeah. What I'm trying to say is that we we think about those things, it's not a matter of just yeah, okay, let's just go here because here's cheaper or whatever. Yeah, yeah. Yeah, yeah. There's a lot of thought into when we make the decision to open a policy in X company, there's a lot of thought that's put into that decision.

SPEAKER_00 38:35

Absolutely, absolutely. And it's always about the client, right? So everything is about the client. Yeah. Um everything.

SPEAKER_02 38:44

All right. I think there was a great discussion. Uh, anything you would like to say, George, before we uh close this episode.

SPEAKER_00 38:54

I'm I would say we need to change how we think. We need to realize that there are different ways of doing things. And if you were to sit down and make a list of the attributes of the perfect investment, just think about what you would want that investment to have, and then talk to somebody who knows and see what that investment actually is and whether or not it's really an investment. Because anytime we invest, there's a risk of loss. We're not even talking about any risk of loss. We're not, we're not tied to any market. We're, you know, we we don't have to worry about market volatility. We don't have to worry about trying to beat inflation. We don't have to worry about losing control. We don't have to worry about hidden fees and taxes, et cetera, et cetera. We're talking about as close as you can get to the perfect investment. Um, and it's available. You just have to learn it, understand it, um, get your head around it, which doesn't always happen right away. Um, but once it does, you'll wonder why you haven't heard this before, and you'll wonder why not everyone is doing this. Yeah, it's uh and the only reason they're not is because they haven't heard of it.

SPEAKER_02 40:19

Yeah, and it's well said. Rethink your thinking. I we I will add to that. Rethink your thinking. Uh research the arrival syndrome, research Parkinson's law, and I will leave you guys with those two. Thank you for listening, and I'll see you in the next one. Bye. Bye for now. This episode of the Sovereign Capitalist Podcast was provided with the understanding that the staff and contributors of Asteris Capital Advisors are not herein engaged in rendering tax, legal, or financial advice. For such matters, please consult your own tax legal or financial advisor.