Talk Radio 560 k. As if oh this. 60 is a San Francisco San Jose Oakland Cumulus station on Amazon Alexa open the key is still there will be a rewrite American heroes I'm Richard Johnson a Democrat on the House Intelligence Committee says he and fellow party members will rewrite that memo on f.b.i. Intelligence gathering that President Trump has refused to make public any it's current form the president saying quote The Democrats sent a very political and a long response memo which they knew because of sources and methods and more would have to be heavily redacted whereupon they would blame the White House for a lack of transparency we told them to redo and send back in proper form correspond to run Knoebels at the White House high praise for 2 suburban Columbus Ohio police officers who were shot and killed while responding to a domestic disturbance call this morning show more bits or is the chief of the department in Westerville Ohio to your life today responding to calls it was systems or the potential domestic situation both officers gave their life and protection rather those are true American heroes the fallen officers Eric during an Anthony Morello. Had a combined 46 years on the job a suspect is in custody but police aren't sharing in the details lots of speed skating figure skating ice dancing at the Winter Olympics and beyond Chang South Korea tonight but no men's downhill high winds are forced postponement of the Sunday competition no word yet on what date organizers will use to fit in fit it into the schedule the betting could be intense tomorrow morning in Las Vegas is one of the last collections of Hollywood memorabilia owned by Debbie Reynolds goes up for auction Vegas magician Marie such will be placing up a bit or 2 they have everything like lamp shades and lamp she would have had their home to cotton jewelry she has some caution that she accused her live production shows here in Vegas when she had her show at her own feet. Also up for auction some items from Carrie Fisher Reynolds daughter remember they died a day apart I'm Richard Johnson. A strange accident out there this traffic report is sponsored by Danville home Expo Highway 82 was found after El Camino Real in San Mateo an accident between a car and some barrels on the road have a 3rd lane blocked on 80 eastbound or central you'll find the entry ramp closed due to ongoing work want to one northbound in San Francisco between Vermont St and the 80 split you'll be slowing down to about 9 miles per hour due to very heavy traffic and 80 eastbound between Harrison Street and the Bay Bridge as you hitting the brakes due to congestion putting off your home improvement projects the good news the home mag is hosting the Danville home Expo this Sunday February 11th at the Danville community center for 20 Front Street admission is free open from 10 to 4 info at home Expo Events dot com I'm Allen Ruben Talk Radio 560 k. Geo. It was we unite families help you learn and gain wisdom on how to enjoy an abundant life and live the life you want to leave. My passion is to help you get clarity confidence and have new capability on what you should be doing today I'm going to talk about the stock market whipsaw that has happened recently and it will continue to happen folks this is very predictable I talked about this many times but I want to talk about that and help you understand what you should be doing and understand why these whipsaws happen why some people actually cheer now they're not really happy or relishing in that the stock market is crashing or nose diving Ok but they actually sort of go go go go because they're not losing a dime and I want to show you why that happens because back from 1984 to 1980 I actually had over 3000 clients in the stock market in mutual funds and so forth and when I finally got them out of the market into my favorite vehicle with my favorite strategy they no longer needed to fear when the stock market crashes now let's talk about sort of what happens because this is not new I mean many advisors will say just hang in there Ok. But how many of you recently when the stock market goes through these whips sort of felt fearful or you felt a little bit confused or powerless What should I do what's going to happen is is it going to keep getting worse should I sell what should I Ok Well let me tell you why some folks almost cheer when the stock market nosedives and crashes this is my 10th year I've been on the air with Live been at radio now some stations throughout the country. Doug we have so many financial advisors who sort of come and go and they seem to run out of content where do you get your content you never seem to run out of things to talk about what you're sacred and I usually answer and say wow I feel like a grizzly bear on a permanent salmon run Now if you've ever been to Alaska when the salmon run it's the most incredible phenomenon where the salmon go out into you know salt water for 4 years and then they come back and they have a 1000 choices to make turn right or turn left but they find themselves back into the place where they were born and they have one thing on their mind and that's to spawn and then die Ok they want to reproduce and so you catch those salmon be because you're irritating them with a lure they're not hungry Ok but a grizzly bear goes out on those falls and they just basically have to open their mouth and pretty soon a salmon will jump in their mouth or they may have to stretch just a little bit to have that salmon jump in their mouth Well that's what I feel like is a grizzly bear on a permanent salmon run because whenever bad news happens whether it's in the stock market or tsunamis or tremors or earthquakes or shootings or terrorist attacks or whatever this bad news has been going on for millennia and I discover the world's bad news and I go dear why are people out there feeling confused and isolated in powerless today because this happened in a physical sense or in a terrorist attack or a shooting and all of us on the stock market nosedives and people are running around and they're fearful and what should I do what should I do and I just give people clarity confidence and capability by mustering up leadership relationship and creativity and frankly I have never ending content so that's what I mean when I say that to the radio stations and. Let me explain what I'm talking about with this recent whipsaw in the market now let's just pick a date you know the Dow Jones or the s. And p. 500 These are measurements folks and recently let's take Monday February 5th for an example now that day I actually had some business meetings in the morning and then I wanted to go ski with my grandson who turned 10 years old that day and I went up and skied for 3 hours and one of our favorite ski resorts and that is that day if you remember that Dow topped out around $25500.00 or so and then it dropped the worst point drop in history not percentage wise as far as the total Dow but the point drop was at one point was $1597.00 points but then it ended up the day about $1175.00 points down worst day ever in a point drop now why 1st of all I don't want to really delve into you know people they panic they sell the news the Federal Reserve manipulation of rates and Wall Street is saying Well computers are are faster than humans can react and so they're the computers where we're catching up and humans were trying to react to it and and there was all these excuses why there was an 800 point drop I think 600 points in less than 8 minutes and it's because of all these reasons they want to give you what now can I just ask you something could this stock market drop over the next year or 2 from you know this high of a Around 25000 down 215000. Sure Ok that's a 40 percent drop it's done it before it did it from 2001 to 2003 and you might say Well that was because of the terrorist attack of 200-1911 well yeah well what about 2008 it dropped 40 percent in one single year so yes the Dow Jones could drop from 825000 point mark down 215008 could do it in one year now I doubt it will do it in one day but it could do that because of reactions and so forth this is just a fact of being in the market so when we talk about losses I prevent losses and I learned this back in 1980 but then it was solidified in 1997 because one of my favorite strategies is indexing and what a lot of people don't understand is that if the market loses 25 percent Ok And let's say you have 100000 and the market loses 25 percent your 100000 goes down 275000 now most people think well if the market rebounds 25 percent of the last $25.00 it only has to gain 25 percent No a 25 percent loss has to be followed by a 33 percent gain 75000 after a 25 percent loss has to have a 33 percent increase 33 percent of 75000 is 25 so when you lose 25 percent you have to gain 33 percent just get back to breakeven if you lose 33 percent if 100 grand goes down to 66000 or 67000 that has to have a 50 percent gain to make up for a 33 percent loss if you lose 50 percent many people in 2008 lost 50 percent if 100000 bucks loses 50 percent down to 50050000 has to have a 100 percent gain it has to double to get back what you lost Ok You wouldn't believe that is the question on a proficiency exam that I have the. That comprised of 100 questions that question what does a 33 percent loss have to be followed by to get back to break even and most financial advisors I'm talking about over 80 percent circled 33 percent I want what you don't understand that a 33 percent loss has to be followed by a 50 percent gain they they didn't even get it and I heard 3 major advisors on n.b.c. One day that missed that question Ok Can I just. I'm running out of time on this segment but what if a surgeon told you that if you underwent this you know life threatening surgery there's a 30 percent chance that if it was if you got through it Ok you would be worse off 30 percent chance. And it may take 123 or 4 years for you to recover to the health that you had before this surgery. Would you go through that surgery do you know that in the market at least 30 percent of the time at 3 out of 10 years you will lose money Ok now in 2002010 there were 5 years that people lost money but what if the surgeon said there's a 30 percent chance that you'll be the same when you go through this surgery but you won't be worse off there's a 70 percent chance that you will be better off substantially now would you undergo that surgery how do you do that in the next segment I'm going to talk about how to do the 2nd option where you don't lose when the market goes down in might people actually cheer because they're not losing and they'll start making money again the 2nd it recovers in the next segment I will teach you how people who locked in up to 24 and 25 percent last year didn't lose a dime on Monday February 5th and they will continue they may not make anything this year but they won't lose what they made or locked in last year Ok this is critical but if I've said enough and you have to go and you happen to live in the greater San Francisco Bay Area I want you to come and learn and these are free fall day events titled retire by design but seating is limited I'm not kidding and so for your convenience we're teaching at 3 different locations these are new locations 3 different dates Thursday March 22nd we will be in Palo Alto at the University Club of Palo Alto these all start at 8 am sharp we go until 5 pm their title retire by design you'll get a workbook that you fill out throughout the day you'll be able to have lunch and meet with one of the top wealth architects in America this is a game changing day for those people approaching retirement or already in retirement then the next day we will be. In Dublin this is March 23rd a Friday Dublin ranch golf course from a.t.m. And tel 5 pm retired by design and then on Saturday March 24th will be in Morgan Hill at the Coyote Creek Golf Club we've been there once before we had such an incredible reception we want to come back to Morgan Hill don't miss out these are free events but you must call now and register one aged 876 radio is the number that's 188-767-2346 learn in Palo Alto or Morgan Hill call 180876 radio read just one it retreats. I said down through it could occur from a show for. The years are already lost and so I actually put into practice finally the schools learned how to avoid the Ira and for a one k. amazing future in the previous segment if you're just joining us we were talking about how to react positively actually be able to act instead of react as so many people react when the market goes volatile and so forth we were talking about how this whipsaw in the stock market oft times make people confused and they feel isolated and they feel powerless and they don't know what to do and yet ever since 198-3000 clients I had at the time in 13 western states. Never happier than when I got them out of the market . And I linked their returns especially starting in 1997 and that's when indexing was introduced I linked them to the market so when the market did well they got to take advantage of those gains for example many clients of the wealth architects that I point my students to this last year in 2017 locked in gains of 14 and 15 and and even 24.9 percent and so forth because you know a January of 2017 if you remember. The Dow broke the $20000.00 mark and then. It talked out at about $252055.00 or whatever so that's a 25 percent increase Yeah there were some people that made 25 percent last year in the market but here's the key those who made 25 percent by the end of the year December 31st let's say of 2017 they locked that am so that they would not lose when the market crashes it's not a matter of if it's when whether it's this year we end up in any given point in time where we're down because the fact of the matter is 30 percent of the years of you take any 10 year period in American history since the Great Depression and there's usually 3 of those 10 years that are down years Ok and 7 years are up years the worst decade 2000 to 2010 there were 5 down years and 5 up years and yet you see an indexing as a strategy without doing anything if you fell asleep like Rip Van Winkle and you had a 1000000 bucks in the year 2000 and you would have woken up at the end of 2010 with over $2000000.00 you would have doubled your money and it would have been tax free now most Americans and. The 1000000 they had in the year 2000 was only worth 620010 years later it took until 2012 to make back what they had lost in fact they lost up to 40 percent twice in that decade so there were only really not 5 last years where I didn't make anything but I didn't lose and that's critical but there were only 2 because I don't just sit there and earned 0 I just moved back over and earned what is called the The fixed general account portfolio rate which at the time was 5 percent so there were 3 years I didn't make much I may only made 5 percent which in today's day and age is pretty good when banks are only paying one percent or less but there were other years I made whatever the market did whatever index that I was linked to whether it was the Dow Jones or the s. And p. Or the Russell 2000 or the Barclays whatever sometimes it's several indices because I can diversify and this is where by moving the money and rebalancing I moved my return from 7.23 up to 10.09 in 10 years. I was able to more than double my money in fact in a couple of instances triple my money and so instead of having a $1000000.00 double to $2000000.00 it tripled to $3000000.00 and you can do this too and actually not worry or fret when the market goes down because it's just going to happen and I had this majesty of calmness on the ski lift on Monday February 5th and I was thinking as I was looking at my smartphone on the right up the left oh dear people are probably scrambling around they're panicking and they're trying to should I sell what should I do if I cash in and I'm so glad that I haven't had to worry about that and that I wasn't losing the money that I made. In 2017 and the people that we helped but they don't have to worry about that they don't have to be told Come down come down the market will come back it always comes back. Well sometimes it takes 3 and 4 years to come back from a loss where maybe you've suffered 40 percent I don't want to do that and that's why I used the metaphor in the previous segment if if you went to a surgeon of the surgeon you know or to say now you've got a 30 percent chance that you'll be worse off when we get through with this surgery and it may take 123 or 4 years for you to come back feeling as healthy as you were . But if this heritage and said you know even got a 30 percent chance that this may not benefit you but you will not be any worse off but you've got a 70 percent chance that you'll come out ahead now I would go through with the surgery does that make sense that's what indexing does it allows you to have the chance for any upside in the market the 70 percent of the years where the market goes up but the 30 percent when it goes down you don't lose Ok you may not make anything but you don't lose what does that mean well if you were to have a 10 year period and let's say the market went up 50 percent and down 50 percent at 50 and down 50 now people say watch that's very unlikely will this illustrates my point if you had 100000 bucks in the market and the market went up 50 percent you'd have 150000 but if the market dropped 50 percent you're not down to just 100 again you lose 50 percent of 150000 you lose 75000 you're down to 75000 you've lost 25 percent of your original principle you started with if the market rebounds 50 percent you're up 1125 if the market loses another 50 percent you're down to 56000 you've lost 44 percent of your original principle but see Wall Street gets away with saying Oh the market's up 50 down 5050 down 50 you're dizzy row you're does broke breaking even it's just flat no you're not breaking even you're losing if the market were to go up 10 percent down 10 percent up 10 down 10 for 10 years most people say oh you. Broke even you know the market goes up 10 and down 10 for 10 years you're you've lost 5 percent of your original principle your 100 grand is only worth $95000.00 but what if the market went up 10 percent and then when it went down 10 you didn't make anything that next year but you didn't lose the 10 percent you made the year before you luck to that and so in a 10 year period you had 5 years where you made 10 percent the other 5 years when the market dropped 10 percent you didn't loose you didn't make anything but you didn't lose what you made the year before you know what the difference is your 100000 would be worth 161000 not minus $5000.00 off the original principle would you rather have 161000 when the market goes up and down up and down up and down or have only 95000 to show for the 100 grand you know you started with 10 years earlier you think this is you know just fluff or are are not realistic now I'm talking about real life examples like 2000 to 2010 when many people in the market their $1000000.00 nest egg they took their entire lifetime to accumulate was only worth $620000.00 the market went up and then it went down 40 percent over 3 years in 2003 it took 4 years till 2007 to make back what they lost then they lost 40 percent again in 2008 and by the end of 2010 they'd only come back 262-0000 it took until the end of 2012 for most Americans in the market to come back to breakeven and then start making money again don't do that I can show you how to avoid that and how to be able to sort of have a majesty of calmness like I did on the ski lift on Monday February 5th when I'm sitting there looking at my smartphone and I'm going Oh dear 800 points Wow I dropped it wow it dropped. 1500 points at the worst nearly 1600 and I'm gone well I'm not wor