Financial crises create panic. Long-term thinkers create stability.

In this episode of Make Your Wealth Work, Jason K. Powers and Joe Pantozzi sit down with Dr. Paul Mueller, Senior Research Fellow at the American Institute for Economic Research and author of 10 Years Later: Why the Conventional Wisdom About the 2008 Financial Crisis Is Still Wrong.

The conversation begins with the 2008 financial crisis, but quickly expands into a broader discussion about economic uncertainty, interest rates, regulation, and the unintended consequences of policy decisions.

More importantly, this episode explores how individuals should respond.

Dr. Mueller discusses how fear-driven headlines distort perspective, why interest rates and inflation matter more than most people realize, and how disciplined capital formation protects families during volatile times.

Jason and Joe connect these big-picture lessons back to personal strategy:

1. Why patience beats panic
2. The danger of lifestyle inflation
3. The importance of capital and liquidity
4. Why long-term thinking creates freedom
5. And how controlling the banking function in your life provides stability

In uncertain times, reacting emotionally is easy. Thinking long-range is powerful.

Follow Alpha Omega Wealth

YouTube: https://www.youtube.com/@alphaomegawealth3054

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Facebook: https://www.facebook.com/alphaomegawealthadvisors

Connect with Dr. Paul Mueller

The Mueller Report (Substack): https://pauldmueller.substack.com/

AIER Profile: https://www.aier.org/staff/paul-mueller/

To connect with Jason or Joe, visit:

https://alphaomegawealth.com/podcast

Welcome to Make Your Wealth Work a practical show for builders,

entrepreneurs, and anyone who wants to think like one.

I'm Jason K. Powers here with Joe Panzi.

Today is an exciting episode, so buckle up and joining us

we have Dr. Paul D. Mueller.

Paul is a senior research fellow at the American Institute for Economic

Research, and he serves as a research fellow and associate director for.

The religious liberty in the States project at the Center for

Religious Culture and Democracy.

He previously taught economics at the King's College in New York City.

Paul is also the author of the book 10 years Later, why The

Conventional Wisdom About The 2008 Financial Crisis is Still Wrong.

So we're gonna have some conversations about that.

This book argues it's time to reassess the popular narrative and

maybe reverse some faulty solutions before another crisis happens.

Paul, thank you so much for being on.

Welcome to the Show.

Thank you so much for having me.

Glad to be here.

Yeah, it's, it's fun.

So I, I love.

Talking to you and, and reading the writings you've put out

over the past few years.

You know, we've met a while back and we'll, we'll talk about that.

But I, I've really enjoyed, since my background is in the Infinite Banking

Concept and understanding Austrian economics a little bit and, and we

crossed paths, uh, specifically I don't remember how, but I believe we got an

introduction and, and then your background in this has been fun to kind of.

Talk a little bit about it and, and have you on previous webinars, you know, as

we've run into certain financial crises over the past many years in this country.

So it's fun.

That's right.

I think, did we talk about kind of the Silicon Valley bank

We did, we did.

time we talked it was right around when that happened.

That's right when the Sillicone Valley Bank crash crisis.

And that was a good one.

I mean, it was, it was kind of a mess there for a while.

Panic.

A panic.

so let's, Paul, let's talk about, let's go all the way back to 2008.

2010, you know, you put out this book back then kind of reassessing the conventional

wisdom from 2008, and tell us a little bit about that and what, what was kind

of the motive behind it, I guess, and

what is your opinion of that?

How, how do you, how do you summarize that book in, in under an hour, you know?

exactly.

Sure.

Well, happy to talk about it.

I, I was interested in the financial crisis because my dad works in

finance, he's an investment manage manager it was a brutal year.

I was just finishing up college at the time, and the narrative that a

lot of people even maybe say right of center political people had.

that markets had failed, you know, markets just collapsed.

There was, you know, ramp and greed.

There was all the speculation.

Banks took on all this risk and it was a failure of regulation.

And if the government didn't involve, didn't, didn't intervene the way

they did with huge amounts of lending and bailout money and lowering

interest rates dramatically, then the market was just gonna collapse.

It was gonna be the next great depression.

And I was skeptical of that explanation.

You know, but I, but I didn't know why I, I, I knew I liked markets.

I didn't believe that markets were just failing the way people said, but

I didn't really know how to answer it.

It was very complicated.

I, I didn't know a ton of the financial ins and outs and so.

I went to graduate school not long after that in economics and part of during my

time there I was reading and thinking about what happened, how the crisis

played out, and then the book I wrote was really to get my own thinking straight

in terms of the timeline, the events that happened, reading some number of

different explanations and trying to piece together what really happened and.

You know, in hindsight, the the 2008 financial crisis I tend to think.

Is more important every year as we go forward.

It was really a turning point, not just in financial markets though it

was, and we should talk about that, but I think it was a huge turning

point socially and politically.

I think it signaled the end of, you know, the nineties era, early two thousands

where there was a lot of stability.

A lot of growth, a lot of optimism, a lot of creativity.

the 2008 financial crisis really shook a lot of people in a lot of ways.

And I really think it's coming out of that, that we've seen much

deeper polarization in our politics.

We've seen much more aggressive,

Back and forth on social media and, you know, radical proposals, right?

You don't have a lot of proposals in the nineties about the warmth

of collectivism as Mayor Momani was talking about a couple weeks ago.

and this had effect kind of throughout the world.

It had effect on the, the regulatory structure.

And returning to the financial side of things, as you both know, when

it comes to wealth creation and investment interest rates are incredibly

important, interest rates and inflation.

coming outta the 2008 financial crisis, we entered an era of extremely low

interest rates intentionally so, because the Federal Reserve wanted to try to.

Reinflate the housing bubble stimulate economic activity, so they had interest

rates remarkably low for almost a decade.

After 2008, and that has a big effect on people's savings, right?

Just, you know, traditional bank savings or money market

accounts or other sorts of things.

Hard to get much of a yield when the overnight rate is less than 1%.

And that has effects on what the Austrians would call the capital structure, the

kinds of investments that are being made in capital projects, and even companies

that invest in more capital heavy.

Enterprises, which is related to concerns today about manufacturing or

decline in manufacturing in the us.

It's not just a trade issue, it's an an interest rate

investment, regulatory issue.

so anyway maybe there are things where, directions we want to go here, but I,

I think it's tremendously important.

And, and maybe to go back to answer your, your question briefly, the

conventional wisdom as I was alluding to.

Is that markets failed.

Banks got outta control.

They were greedy.

They were unregulated.

They took too much risk and that crashed the system and the government

had to ride into the rescue.

my take is to completely different from that.

I think the 2008 financial crisis was a story of That is

to say incorrect regulations.

If you

Hmm.

at the kinds of risks that banks were taking, particularly around.

Mortgage backed securities.

When people talk about the subprime crisis or toxic MBS or mortgage backed

securities, you look at all the, the banks investing in this stuff you do

a little digging and you realize that there were regulatory changes, and we

can go into the details if you'd like.

In the early two thousands that encouraged banks that privileged.

Holding mortgage-backed securities from a regulatory standpoint in terms

of how much capital they had to hold.

so what you see is systemic increases in bank investment in these mortgage-backed

securities because of regulations.

That rewarded them for doing so.

So you have this, what we call kind of herd behavior or kind of group

think everyone's doing the same thing.

And it turns out there were a number of structural problems in the housing

market, partially due to manipulated interest rates by the Federal Reserve in

the early two thousands, partially due to other regulatory elements in terms

of reducing underwriting standards.

Started back in the nineties with the Community Reinvestment Act and then

was just kind of added to through these big kind of quasi government agencies,

Fannie Mae, Freddie Mac, that buy lots of, buy most of the mortgages.

And so they were pushing mortgage originators, those who create mortgages

to, to lower their underwriting standards.

So.

Normally, you know, we think about a down payment is 20%.

Well, that's a thing of history, right?

By the early two thousands it was 10%, 5%, 3%.

You have variable rate interest.

I mean, this is stuff that, that you guys probably know quite well.

And so you have this significant change in the quality of mortgages,

broadly speaking, that was a little bit hard to detect.

It happened gradually.

It wasn't visible on the surface.

And of course.

of the problems is things look great when times are good, but you only understand

the risks after something bad happens, after there's some kind of stress on the

system or some kind of crash, and so no one was observing many differences in the

performance of these much lower quality.

Mortgages that were being written and created.

There was no real observable difference in terms of performance until you

have a recession and you have a panic, and then it turns out, hey, you know,

the traditional 30 year, 20% down payment is a radically different

story than the 3% or no percent down.

You know, they talked about ninja loans.

No income, no job, no assets, you approval.

So all kinds of crazy stuff going on in the housing market.

But again, back to the story, banks jumped in with both feet because of regulatory.

that encouraged them to do so.

And then, I mean, we could walk through 2008 itself.

And the different interventions that the government made that I think actually

created greater uncertainty actually contributed to a deepening of the crisis

that they then came in to try to fix.

Yeah.

Yeah.

less than an hour, but that,

Yeah.

than you wanted to hear.

Yeah.

Yeah.

There's, I mean, there's so much to it to kind of pull apart and that,

I think it's, I think, like you said, it's not so simple as, oh, it

was just this, this is the cause,

That's right.

uh, of what happened.

And, and I, I mean, 2008 was such a big deal, even for me, that's what changed

my trajectory and career and endeavors to do things because I was watching friends.

And family, you know, lose their homes overnight and lose

their entire life savings.

And I mean, my own mother, you know, and, and another friend and, and I

got into real estate investing after that because I was watching a couple

of friends lose their homes and I was like, there's gotta be a way to not.

Before closed on, not even to be elusive, right?

But just there's gotta be some other solution.

And that's how I got into it.

And then fast forward, you know, I discovered, you know, Infinite

Banking through the process.

And, and here we are, right, some 18 years later and, and trying to help

people understand there is more than one way to do things, you know, than

the traditional financial format.

You know, and you've gotta understand, like you've talked

about, you've gotta understand.

What are the banks doing?

It's helpful to understand what are the banks doing, how are they functioning?

Where's my money going?

How much am I putting money into things that I can't control, like we've talked

about in the past, you know, and all these variables and, and I think people

lack that education, that understanding.

And we just kind of like you, the herd mentality you called it.

You know, we just do like everybody else is doing and

we assume we're gonna be okay.

Yeah.

That's right.

I mean, and you know, coming out of it.

There's there were so many opportunities as well.

Like you had to rethink how people did things and, and the real estate,

I mean, the real estate market was just a mess for, for years.

And, you know, it, it, it contributes in some ways to the

broader issue I was talking about, the people feeling unsettled.

I mean, today.

There's a great deal of concern with affordability.

You know, housing prices have, have gone up dramatically especially

post COVID a lot of younger people really feel iced out, and, and

I can kind of understand that.

And I, I recognize, you know, again, talking with friends.

I was fortunate to, to buy some properties between 2010 and 2020, and

that worked out really well for me, in part just 'cause of the timing, right?

Like it would be hard to lose money when the, when the housing

market is bottomed out and you enter, then you like can't lose.

And now that it's high, it's, it's, you can't win or it's hard to win, right?

Where everything is sort of priced high and, and I think that kind of whiplash.

to people feeling like the financial system is a mystery.

Some people get lucky and some people don't.

there's a lack of fairness in terms of, well, some people bought their houses back

when it was, you know, $200,000 a house, and now their house is worth 400 or 500.

They didn't do anything.

They just got lucky.

And here I am, and the house has now cost 500.

And I can't afford it.

And so this is why, you know, there's all, you talked about the complication, there's

all these layers that are involved.

And the Austrian wrote about this at extensive length that they call it the

dynamics of interventionism, where you have an intervention and it creates

some different kinds of problems and you have interventions to kind of deal

with those, creates other problems.

And so when the Federal Reserve was lowering interest rates, trying to

reinflate the housing market in the early.

Or the late two thousands, they weren't thinking, oh yeah, this will probably

create senses of unfairness and randomness and luck as some people would get in.

And some people do.

They weren't thinking about that.

They didn't have that on their minds.

They were just like, okay, we gotta get housing prices back up some

to try to stabilize some number.

We're tracking.

And unfortunately that's, that's often what happens in the policy space.

And, you know, I work in the policy space, so I'll probably

bring in lots of examples, but that's the concern of, you know.

Going in here and trying to, to fix something it tend, the world is,

tends to be much more complicated.

So do you think from 2008 to now what, 18 years later, do

you think we've gotten better?

Well, I think it's hard to quantify.

I think one thing about 2008 and the crisis then was there was sort of

this perfect storm where you have a. Artificially low interest rates from

the Federal Reserve in the early two thousands boosting housing prices.

You have that deterioration in underwriting standards that I mentioned,

reducing the quality of mortgages.

And then you have this regulatory shift that encourage banks

to jump in with both feet.

And so you put all that together.

You get this, this mess.

I don't think we have like a perfect storm brewing right now.

There are areas of concern.

Commercial real estate debt is not in good shape and hasn't been for years.

And you know, again, I don't know if it's gonna result in a crisis,

but there's challenges there.

We, we chatted earlier, I think about Silicon Valley Bank.

Failing and, and their failure.

I mean, it was a kind of a rudimentary failure to manage risk where they had

all of these positions that they didn't hedge or insure, if you will, that lost

a lot of value and interest rates rose.

And

Mm-hmm.

lost tons of money when the Fed raised interest rates throughout 2022 into 2023.

Mm-hmm.

So I don't see, I don't see some kind of tidal wave of problems.

Our, our bigger issues are really, I think.

Government spending and government debt and the more fiscal in nature

and the danger is probably more about whether we can really get inflation

fully under control again or not.

So I think that's more likely to be the risk than some kind

of massive financial crisis.

Right.

So from, from a.

Man in the street perspective, every man perspective.

My client's perspective, ordinary people, who, who aren't reading periodicals,

scholarly journals who aren't enrolled in, in PhD or master's or even college

classes on, on finances, and what they're seeing from a distance is

creating fear in their households.

Hmm.

So, so my, my role is kind of holding people's hands as

they walk through uncertainty.

As we say when we're, when, when we're dealing with, with markets, you know,

holding somebody's hair while they're throwing up over the side of the boat

trying to have people calm, calm down and say, this is not the end of the world.

Right.

you have to go to work on Monday and make a living and take care of your family.

Rates are gonna go up, rates are gonna go down.

Know, I I, the first, one of the first houses I bought

in Las Vegas, rate was 13%.

Mm-hmm.

it didn't bother me that much because it was a hundred thousand

dollars mortgage on my house.

It's, we always talk about the relationship between rate and volume

and people, people agonize about rates, but you know, there there's

certain things that you could do.

You could wait.

Mm-hmm.

Right.

You could, you could try to accelerate your mortgage.

You can, you could put more, more down if that's possible.

But at the end of the day, the rate is what the rate is.

If the rates are sixes in mortgage mortgages today you're either

buying a house, you're not.

Maybe you want to move farther away from the city.

That's not easy.

A lot of people can't move farther away from their jobs.

We're, we're fortunate that we can.

Work virtually where 10 years ago I never conceived that clients would

wanna work exclusively, virtually until COVID proved that it was possible.

So, so for me it's, it's, it's, dealing with people's fear

and trying to reassure them.

You, you still have the basics you need to be successful in your life, or you

have your family, you have health, you have a job, you have you have continuity.

You, you have excellence at what you do.

You have a work ethic, so.

Let's make sure that we don't overspend, let's not, let's not

get into toxic debt as attractive as the initial rates might be.

I mean, half of half of the time I'm talking with people about looking at

their balance sheet and saying, we have to get some of this debt down.

Well, yeah, but I have to max out my 401k wait a minute, time out.

And there's lack of balance here.

Perhaps you could talk about, about the, the fear that comes from watching too

many headlines and, and how we, how we can kind of talk people off the ledge.

that's right.

I remember there's a New York Times bestseller, an interesting

guy named Naem Taleb, who wrote a couple books about risk.

And

I.

of the things he said that really stuck with me and, and unfortunately

I can't really follow the advice given my current job, but he said,

you know, the newspaper every day.

It actually doesn't help you understand the long-term trends.

Well, it actually gets you really caught up in the day-to-day churn

and lose sight of the big picture.

And I think social media is very much like that too, right?

It's what is the, what is the outrage today?

What's the emergency today?

What's the disaster?

It is good advice to focus on the things that you know and are around

you and are tangible as opposed to hypotheticals and, you know, what's

going on in markets day to day.

I. I, I will say, you know, and this is something, you know, I think that we all

share in common or this view that building wealth can be very freeing, right?

Certainly you can be kind of a slave to it if you're pursuing it for the

wrong reasons, but the idea of building wealth is that you become a little

more insulated from the day to day.

You can, you know, if you lose your job, you have some time to find another one,

or if something, you know, you have an expense that's unexpected or something

doesn't turn out the way you hope.

not like you've put all your eggs in one basket.

And so this is why diversification has been the mantra in investing for forever.

And I think it's still true today.

You know, someone, I've read that part of why I bought the place where I live now.

It's actually a bed and breakfast up in the mountains that I live at and run.

And, I read Robert Kiyosaki, the author of Rich Dad Poor Dad, and he had another

book about Retire Young, retire Rich.

And what he does in that second book that I think is so helpful is

he explains the importance of and creativity and changing the way that you

think wealth that people feel trapped.

Because of the way they think rather than because they're actually trapped.

Right.

Hmm.

don't consider certain things to be possible.

They don't consider, well, that's what rich people do.

I couldn't do that.

Like, you know, I couldn't go.

I'll give you an example of like how this played out to be.

I remember reading the book.

Kiyosaki said, yeah, you know, borrowing money from banks to buy

houses is kind of a pain and, and hard.

It can be hard.

You have to qualify, da, da, da.

You really should borrow money from the person selling the property.

Like lots of people who sell properties are willing to finance it, you

know, depending on their situation.

I'm like.

I've never heard of that.

That's, that's crazy.

And then later the summer, I bought this place that was financed by the seller.

And he was right.

I mean, we put together our own note.

Didn't have to go through a bank.

A bank would never have lent me money for this place because I had the

cash, I had a job, but I bought a house in New Jersey earlier that year.

They would not have let me buy an investment property in another state.

You know, they would've been like, there's no way you qualify.

But the guy I was talking with, you know.

Was just like, yeah, I wanna sell it.

And, you know, you've got the money for the down payment and, you know,

we talked some and set up the terms.

So anyway, so I didn't even think it was possible.

I read this, I'm like, that doesn't happen.

And then it happened.

And so, you know, ki like just talks about the importance of being

open to trying things, to learning.

How things, and, and something I've talked with folks about that again, I

think you'll both appreciate, is that people look at wealth as being mysterious.

Some people get lucky and some people don't.

And some people have the high paying job and others don't.

But really wealth is kind of like a language, you know?

And in the United States, understanding the rules of the game.

Right.

What's a 1031 exchange?

What are my tax liabilities?

How do I think about deferring taxes?

How do I think about tax advantaged vehicles?

It sounds very foreign to most people, but actually if you spend some time

studying and thinking about it.

There are many ways to build wealth but you need to understand how it works.

You know, the pitfalls, what you, you know, how you can waste it

or, or make poor choices and all.

Just understand how the tax system is set up in such a way that some activity.

Is far more profitable and beneficial than other activity.

So anyway, so I kind of tell people that too, that not just a trick or

a lock, like there's a logic to it.

There's rules to it.

And a big part of what we need to do is, is be open, creative, and willing to.

You know, take some risk and make some effort.

Maybe start small, but there's a lot that can be done even today,

even in a world that a lot of people feel is, you know, unfair, the deck

stacked against them Still tons of ways to succeed in this country.

Mm-hmm.

And I think it's a willingness to think outside the typical box.

Maybe.

I mean, I love how you put it where wealth building is like a, a language, you know?

It's like learning the.

Rules around it.

It, it's not, I don't think a millionaire was ever made just sticking it in a

savings account, you know, really.

I mean, like, they're doing something with the money besides just shoving it

under the mattress or, and, and, and I'm gonna accumulate my millionaire status.

You know, it's typically not how it works.

And I love, I love that.

See, you just gotta think outside the box and learn the different opportunities

that are within your reach, right?

Or if they're not and you want to get to that reach, why don't

you start working towards that so that you can get there someday?

Rather than say, you know, I reach that top shelf, I'll never

be able to reach that top shelf.

Well, let's find a stepladder.

No, that's exactly right.

And you know, I think the idea of sort of house hacking is really important

of, of how do you, how do you use your house as an investment vehicle, right?

Whether it's buying a duplex or if you're single, renting out rooms.

I mean, you can make housing incredibly profitable depending on the deal and

the way you set it up that it's not.

Just where you live, but it's something that you leverage, right?

Whether it's short term rentals or large term rentals, or it's a multi, multi

eight unit and, and even for example, you know, people might say, well, I.

You know, how on earth am I gonna afford a duplex or I gotta save up 30,000 or

40,000, and that's gonna take me years.

but again, you're not thinking outside the box.

It's sort of, I, you know, I talked to some friends of mine at church who

maybe don't earn as much, and I said, look, if you find a property that

you think has good fundamentals and you need to learn what that means.

Like, I'd loan you 50 grand to go buy a house.

Like you, you could raise the money.

Not, and people do this with family and friends, but, but like really you

can, like there are people around you who have resources, who are, you know,

would be invested in helping you out.

If they're confident.

You have put in some time to know what you're doing and you have a

strategy and obviously you wanna do that thoughtfully, but most people

don't think, oh, I could have access to 20,000 or 50,000 or 80,000 by asking.

folks around me if, if I've done my homework and I have a plan, you

don't necessarily have to wait years to accumulate that all by yourself.

But again, most people, I mean, it would sounds crazy to be like, oh yeah, I'm

gonna go ask somebody for 50 grand or I'm gonna go like, you know, that's just not

a, a super common thing unless you live in a world of entrepreneurs and people

who speak this language and like, oh yeah, I do deals with my buddies all the time.

We set up the LLC, we do whatever.

You know, for some people it's like, that's totally normal.

But for most people it's just like.

Foreign language, foreign country.

And that's where you wanna educate yourself and, and

have a kind of an open mind.

Well what, what really can I do?

And you can actually potentially do a lot relatively quickly,

Mm-hmm.

but you have to do your homework.

That's the other piece is you have to do your homework.

I,

That's right.

That's right.

of doing homework might be not looking at somebody else's situation

and applying it to yourself.

that's

So this person I know makes more money than I do and is maxing out

their 401k or maxing out a pension plan at their office and so forth.

So I, I have to make that a number one priority.

Wait a minute, you want a tax deduction, you're 25 years old,

you're just getting outta college.

You're just getting, starting a family.

You, you have a little bit of college debt or whatever.

Do we even know what your tax bracket is before you make a decision to

start putting money when a, you know, a tax deductible plan that

you won't see for 40 years, find out what your, what your current.

Data is, a tax deduction should be tops on your hit parade.

let's find out if building some capital towards more immediate

things that you'll need in the next few years as opposed to retirement.

I'm not saying.

Procrastinate forever, but at least know what that tax benefit might be worth to

you in dollars and cents before you pull the trigger and deprive yourself of the

opportunity to pay off that college debt, to pay off that, that credit card debt.

look at the priorities and the balance need to create in your own,

in your own home, your own family.

Yeah, that, that's a great point.

I mean, and it's hard to do in this day and age where it's really important not

to try to live somebody else's life.

And that's what I think a lot of people are drawn to, and social media kind of

fuels that, but it's always been there.

But you're absolutely right.

You know, just 'cause your friend made a bunch of money at

one point trading on Robinhood.

Doesn't mean you should jump on and start trading on Robinhood, right.

Or, or buying Bitcoin or whatever.

I mean, again, those could be good investments, but you gotta

do your homework and you gotta figure out your situation.

And you know, I mean, I'm sure that, you talk with your

clients about this all the time.

I mean, the other piece is you just gotta be patient and I find for

myself, you know, again, I run in circles with entrepreneurs and friends

who've done very well, and I find patience, even for my, for me, can be

a challenge of like, well, well, how do I, how do I do more this month?

Right.

How do,

Yes.

my net worth over that this next six month period, right?

How do I, how do I move to it?

And it's sort of like, you know, that's not really how it works.

Like you gotta, you gotta be patient, let your plans work, have discipline,

you know, and, and think, think in terms of years or maybe even decades, right?

As opposed to days or weeks or months.

And again, we live in this cycle with when there is a lot of frothiness,

a lot of money, and you hear the get rich quick and some people do, right?

They get lucky and, and so forth.

It's easy to be like, okay, if I'm not a millionaire by the

end of the year I'm failing.

It's like that.

That's not, that's not really how this works.

You've gotta think through where you're at and where you're trying

to get to and what's available to you, and have a plan that that

involves discipline and patience.

Yeah.

Well, and the term we would use is think long range, right?

Which comes out of Nelson Nash's becoming your own banker book.

Whereas one of the five rules of IBC is this think long range.

You know, we don't do a lot of big deal things.

On a quick get rich, quick kind of this perspective, you know, that, that

those are dreams and those are the lucky and the, you know, these kinds

of things, but you really need to think long range and any type of vehicle

you're using to build wealth, right?

I mean, rentals, we, I talk to real estate investors all the

time and we talk about you're not gonna get rich off of one rental.

You're, you just, you're just not now.

The longer you have it, the more you can generate from it usually.

And so you gotta think long range.

You're going to have it for a really long time, so you can pay that down and make

the spread, or you're gonna buy multiple

Mm-hmm.

think long range.

Start stacking what you're doing.

And then we talk about that in the Infinite Banking

space, right when you start.

Understanding the Infinite Banking Concept and how to utilize this properly

structured whole life insurance policies.

Some people look at it strictly like an investment vehicle and they're going, oh,

this, this has a, a low rate of return.

I'm not making any money in the first couple years.

And I'm like, well, hold on, hold on, hold on.

That's to clarify here, but, but that's the thing, right?

It's this, I want more now anyway, and, and we gotta think long range.

Yeah.

Well, and it's easy to, yeah, to think that way in, in terms of, you

know, it's easy to worry that you're doing something wrong and, and this

is why, I mean, so another point, again, I, I take this from Kiyosaki,

but I think he's absolutely right.

Here is another part of.

Building wealth and learning to, to achieve financial independence

really about finding team, finding people you can trust,

Hmm.

know things you don't know, whether that's, you know, accountants, investment

advisor, life insurance and you know, when you start out you don't need

a big team, but, but over time you need to, you want to develop a team

for people to kind of reassure you.

Yeah, no, this makes sense.

be patient.

It's, it's working, you know, and that, I don't know, handholding might be, might

be a little bit pejorative, but sometimes we all need a little handholding, right?

We have those moments of doubt where like, wait a second.

What, what did the market do today?

Or like, where, where are things at?

And it's always helpful to have people who've been there or who

are kind of, no, what's going on?

To kind of say no.

Like, this is all right.

It's just a, it's a, a little speed bump.

But you know, like you've diversified, you've got these structures.

Use your plan.

Keep working it.

Yeah, that's right.

know, you mentioned the word patience and I, I often find that people who are.

Way younger tend to be impatient.

But I also find that people who are older in my generation, when they,

when they decide that they haven't hit the numbers that they expected

to hit, that they feel like they're behind the times behind, behind their

goal, now they become impatient.

And now they say, I better make a big score so I can make up for lost time.

You know?

up the risk

almost, it's almost never a good idea because now you are gonna start doing

something that's not your comfort level.

I better start investing in real estate.

Well, I better start investing in X. But is that something

that's comfortable for you?

No, but look at the numbers.

Somebody else did it.

Now have to stay, stay in your lane, stay in your comfort zone.

Do what's comfortable for you.

I mean, if, if, if you're running, you don't know that you're

running out of time, first of all.

So you don't want to give up the good habits that you've developed over lifetime

just because you think that the number is not necessarily where it should be.

So

Yeah, and I was what was I gonna say?

Something?

You, you were talking about the know, I was gonna say.

In

I.

of pursuing wealth and, and financial independence, it's important to, you

know, keep in mind the good habits that you're mentioning, but also the end goal.

And the end goal, I think in part is peace of mind.

So you talk about comfort level, right?

And it's sort of, I think about this, you know, I. Worked on, like, had investment

properties and many late nights doing crazy stuff, getting ready for renters

or fixing things or, and I've kind of moved past that phase in my life where now

it's like, let me talk about investments that don't require me getting up at

three in the morning or taking random calls or dreading turning my phone on

and finding out there's some problem.

And that's a big part.

Like it's important.

And you know, there's a season where you do that and you're like,

okay, I gotta go fix this plumbing issue, or I've gotta go do whatever.

But part of what you wanna learn over time is, okay, maybe I can trade off

a little bit of, okay, I'm not quite maybe at this number that I want,

however man, I'm in a good place.

Or like I've, I've come a long way and I'm not.

Having to, you know, worry and go out and, and have all of this doubt and concern.

I was telling Jason earlier, I have been trading options some over the past couple

years, kinda as a hobby and, and for fun.

And it, it has been fun.

I've learned a lot.

I've, I've ended up making money as opposed to losing money.

But man, it has added some stress to my life, you know, in terms

of things going up and down.

I'm like, wait a second, nor what do I do?

Did I make a bad decision?

Do I stick with my strategy?

And so you just gotta be thoughtful about.

What you're going for and, and that peace of mind is I think, important

to, to have on that priority list,

Mm-hmm.

Know, know where you want to go

right.

then.

Yeah, that's right.

That's right.

So, Paul, when you and I first met, it was in the context of

the Infinite Banking Concept, and tell me a little bit about what.

You know, maybe for the more for the listener, what

was it that attracted you to IBC and why do you think that is a good way to

turbocharge what you're currently doing?

Yeah.

Well I think, you know, there's, there's a couple angles to it.

One is life insurance.

Is an important thing in general especially if you have a wife

or children to provide for.

It's something that should be part of anyone's financial plan you

can get very cheap life insurance.

If you're young and healthy if you do term that is to say you basically,

there's a, there's a, a, a clock on your life insurance policy.

It's five years, 10 years, whatever.

And you're, you pay your premiums each month and there's some kind of

benefit if, if you happen to die.

but then when the clock runs out at the end of that five or 10 year policy.

policy goes away and you need to get a new policy if you want to do that.

And, and as you get older, the policies get more expensive 'cause

you're less healthy and, and, you know, have less time to live.

And all the premiums you've paid have just been paid.

Right?

They're just gone.

Kinda like when you pay rent on your apartment, you know, you rent an

apartment for years and it's providing you a service, but then you move

and all those rental payments are gone versus when you own a house.

of the payments that you're making, you're, you're probably paying more

than if you're renting an apartment, part of what you're paying is you're

paying interest on a loan, but you're also paying principal and you're

accumulating something that has value and that you hold onto over time.

That, that accumulates.

And the whole life insurance policy is kind of like that, where.

What you're doing is you're, you're buying life insurance.

It's not as cheap as term, but that's because like, it stays with you.

Even when you stop paying, even when you know things change, you're actually

accumulating this life insurance benefit.

but then of course, you know, as you know, and, and probably as many of your

listeners know, if you set up the policy in a certain way, you also can generate.

Interest and, and dividends from your accumulation of this,

this life insurance benefit.

what, what attracted me about it, to go back to your question, is like.

Having somewhere to park my money that is working for me,

but I have easy access to it.

And the stock market is great for long term stuff and even for medium term stuff.

But there's risks and there's timing issues and there's tax implications when

you're gonna sell to pull things out.

So it's a great place to invest for sure, and everyone should invest there.

But it's not.

Necessarily a great place for what we might call working capital, right?

If I

Mm-hmm.

buy a property in a year or two or five years, I wanna have, you know,

have 40, 50, 60, $70,000, whatever.

stock market is, is not the best place necessarily to put that money.

Because it can fluctuate a lot year to year and over time it's great, but

it's not good for the working capital bank account savings account, right?

Not good Interest rate generally is very low.

Money.

Market accounts, again, are a little bit better, but again, not, not great.

And so the, what interested me about the kind of this whole life policy

is that you're buying something.

in terms of this benefit.

That should be a part of your plan anyway.

You have access to it in terms of being able to take out loans against what

you've accumulated and put in at the drop of a hat for kinda whatever you need.

And then it.

snowballs over time or it compounds over time.

And so it made a lot of sense for me to kind of put this in my portfolio

because I had I'm working, I have income, you know, I'm investing in

different places, but I have cash.

What do I do with it?

And I'm already thinking, you know, I have want to have life insurance.

And so those things kind of came together to say, this is a

great thing to add my portfolio.

It's a little more, it's a lot more stable than the stock market.

Rate of return might be slightly lower in the long run.

Kind of depends.

We'll see.

It depends on what the market does, but maybe slightly lower rate, but

still better than a bank account or a savings account or money market or

you know, it's the highest rate or highest return you can get stability.

I think that I've seen.

Hmm.

Then it's great from like a working capital, I want to kind of build my

capacity to, to borrow from myself.

And again, this goes to the Infinite Banking Concept, right?

You can borrow from the bank and pay 4, 5, 6, 7%, or if you can kind of

accumulate that capital yourself.

Then you borrow from yourself and instead of paying four, five, 6% to the bank,

you're basically saving that, right?

You're paying yourself that as you pay it back.

And so it is being your own banker in this regard.

And it can save you tens or hundreds of thousands of dollars over the

years depending on how much you borrow and, and when you pay it back.

So why I, that's why I got involved in it.

It was a great thing to add to the portfolio of, you know,

real estate and long term.

Market investment for retirement and you know, a couple other things that I do.

Mm. Yeah, there's a, I love the versatility of it, you know, kinda

like you're talking about, we, we could put money in different places.

We always say, where do we warehouse our wealth?

Mm-hmm.

put money in different places.

And, and I think my, I'm, I'm gonna use the word favorite for lack of

better words, but I think my favorite feature with utilizing cash value,

whole life insurance that's properly structured for this, this maximum cash

value access is the fact that that.

Grows uninterrupted.

I could put my money in a money market account

Mm-hmm.

and build it up, but if I put 30,000 in there and I need to access 20 of it, it's

growing on the 10 I left in there, right?

And my policy, I'm borrowing against the cash value.

And the cash value is effectively growing uninterrupted, untouched as if

I never touched it, and there's just not another vehicle out there like that.

Go

Hmm.

do that for you.

Yeah.

I mean, would you say that it grows uninterrupted minus the 4% or whatever you

pay on the policy loan or not even that?

Well actually you are using your cash values as collateral, so your

cash doesn't leave your policy.

You are using your cash values as collateral.

It continues to grow in its entirety, and you're borrowing against the

balance sheet of the insurance company.

Mm.

Which when they lend you money at four or 5%, you're replacing the

investment opportunity that they're giving up by lending you the money.

Right.

in in a sense, in a sense, it's like borrowing against your house or your

house appreciates, regardless of whether there's a loan against it.

Mm-hmm.

Not every policy works this way.

We're talking about the policies that.

That we use, maybe some of the older policies, maybe

some of the other companies.

I can't speak for them, but that's, that's the way it works generally.

makes sense.

Well in.

And that's right.

And you know, and, and you know, the other piece, so this is.

You know, more of an intellectual attraction for me, but love finance and

financiers, you know, the JP Morgans and the, you know, Rockefellers and people

who made fortunes in finance building companies and investing in things.

And,

and so I read about that and, and I love the idea of being your own banker of like

the, the idea of funding your bank and the reason why you have lower returns.

In the first several years, and it looks expensive and it doesn't

look that attractive is 'cause it's your startup costs, right?

You've gotta capitalize, you know, Nelson talks about this and

you guys have talked about it.

You have to capitalize the bank before the bank can operate and make you money.

And so you're kind of capitalizing your own account here.

And so I'm, I like.

Capitalizing my own bank and look forward to making money on my own bank.

Yeah.

Yeah, yeah.

I mean, I think we all would love to be in a position to control

that banking function in our life.

If we could be our own lender, borrow from ourselves, pay ourselves back,

like you said, help friends out

Mm-hmm.

and have a good place to warehouse that wealth in the interim.

And utilize it, plus all the other benefits.

The life insurance, on the life insurance side, it's a, it's

a really neat vehicle I think.

Well, and I'm excited too about know, even thinking 30, 40, 50

years ahead you have access to.

So the other difference between term and, and the whole life with this cash

value and policy loan function is that term you only get the money when you

die, which means you don't get it.

Your, your heirs get it, your children, whoever.

But with these policies that are set up this way, as you're, you're accumulating.

The cash value, the life benefit but you can borrow against that before you

die to do whatever you want, right?

Because it's your money.

And so obviously that will reduce what your heirs are paid out.

You know, if you have $2 million in your policy and you borrow a million

to do something, then your heirs will get 1 million instead of 2 million.

But that gives you so much more control to do things that are meaningful.

Or important.

I mean, it could be paying for end of life care.

It could be spending time with your children or grandchildren, and that

is also extremely attractive to have something that you have saved

up for the next generation, but to have so much access and control of

it, it doesn't require you to die to actually fully utilize or have

access to what you've spent a lifetime preparing and building up for.

I.

Yeah, well it can certainly be a good retirement income retirement

supplement when you structure it that way and plan it that way and people

will utilize it, you know, and set up properly on an income tax free

basis at that point, you know, so you.

You have all these advantages.

I'm gonna set this vehicle up and it's gonna be growing

throughout my entire life.

I'm gonna be able to access it, control that banking function in my

life throughout my life, and then I'm gonna use it for retirement.

And then after I graduate, it's going to still pay something

off to my beneficiaries.

And so how many vehicles can speak for that wide of a range of use, you know.

Well, and I think, you know, I don't know if you ever use this analogy, but thinking

about investment, the diversification, we talked about a lot of people, what,

what you should think about, and maybe this is more tangible for folks, is you

should think about, imagine you, you know, just moved into a, a new house that

you bought, but you've done like nothing when it comes to repairs, maintenance,

construction, You have no tools.

Well, you should, you should get a tool, right?

Like you should get a hammer.

Maybe start with a hammer.

You don't need like the table saw, you don't need, you know, the level, but like

there's a couple tools you wanna start.

And you know, Joe, going back to what you're talking

about, like paying down debt.

High, high interest debt.

Like that's kind of tool number one, you know, and, and, and

cutting back on your spending.

But again, I think of the, the whole life insurance policy.

It's a tool.

It's, it's a great tool.

It's, it's a powerful one.

It shouldn't be your only tool, right?

Like you should have other tools and, and part of developing is you should have a

variety of, of things that you're using.

So, you know, I definitely don't recommend to people, you know,

even when I encourage 'em to go look into it or go into 'em like.

This should not be your only thing that you're doing, right?

You should have a 401k or an IRA.

You should be thinking about what your debt position looks like.

You, there's a lot of things you should be thinking about.

This is a great tool when you're ready for it, and there's all this power to it.

But if you don't even have a hammer, you should maybe start with a

Yeah.

uh, before you go to like the, the cool or fancier, you know,

hacksaw or, or whatever it is.

So anyway, that might be another way to, to describe it of as people

where you're starting, right?

If you have no tools.

You know, don't worry about not having a big tool set, like figure out what

tool am I gonna get next and how do I get that tool, learn how to use it, and

then what's the next tool after that?

As opposed to throwing up your hands and say, okay, I don't have any tools.

You know, there's nothing I can do.

That's right.

I.

That's right.

Yeah.

I love that.

I love that perspective.

Joe, anything you wanna throw in?

You know, all, all I keep on hearing throughout our conversation

is the need to, to steward our capital, to grow our capital.

Nelson would always say, be afraid to fill in the blank.

Don't be afraid to think long term.

Mm-hmm.

Don't be afraid to capitalize.

I.

Don't steal the peas.

So when you build up that capital, don't just pull it out of your bank

account, for example, not pay it back.

Human nature is, gonna pull it out and spend it.

Yeah, I'll, I'll restore my savings account when I get around to it.

But if I borrow money from a stranger, if I borrow money from the credit

card or a bank, I pay it back.

That's what I promised to do because I have integrity, but when

I borrow from myself sometimes I, I let myself get away with it.

so you need to capitalize and pay yourself back while you're capitalizing and now

you, you're gonna watch your capital snowball in the right way, and having

access to capital gives you access to opportunities that you wouldn't have.

you had no capital.

So some of it, some of it is, is basic, like, like the hammer.

I'm so glad you brought that analogy up because, because the

hammer is, is an important tool.

You, you wouldn't start a workshop without a hammer, so you have to have

some basic tools and conceptually, one of the most basic tools you can

imagine is having access to capital.

And controlling that capital as opposed to having the greatest credit scoring, having

80,000 worth of credit card availability.

Gee, I could borrow more.

No, no, no.

How about accessing it?

So controlling the.

and, just to build on that, I mean, again, what I really value about it and.

You know, kind of knew this would happen, but really feeling it now is

the freedom that comes and interacting with a lot of different people.

You know, I'm not in a, a wealthy neighborhood or, you

know, going to the country club.

I interact with rub soldiers, with a lot of people in a lot of situations.

And you know, money will run your life or debt will run your life if you're

not thoughtful about it and all of a sudden you're constrained and then you

have to make poor decisions where know.

You're, you're, you should get an oil change on your car.

Well, I don't have any money, so I'm not gonna change the oil.

It's like, well, that's gonna work out really badly over time.

Like, you need to have enough money to change the oil like you need to.

There's these constraints that people feel, and some of them are just in their

heads and some of them are, are very real, that lead you to very suboptimal places.

And, and so it, it's important to.

Have that working capital to have savings, to think about budget, to have

this freedom so that you're not just a victim or a constrained where it's

like, oh my gosh, I have to borrow money because this medical thing happened and

I have no nowhere to go and I just have to put it on my credit card or whatever.

So it's, it's important from a freedom standpoint.

And then there's all kinds of benefits that come to being able to

plan long term as opposed to, okay, I just need to figure out tomorrow.

Just need to figure out tomorrow.

So that's a part of it.

And I think what you said too about, again, good habits

is a great way to put it.

You know, something I talk with people about a little bit is

the idea of lifestyle inflation,

Hmm.

Where, and I see this, so I was in New York for quite a while teaching

New York City, and you see this in New York City a lot, right?

Where you've got one or maybe both spouses are working and they're in the, you know.

Let's say $2,500 a month apartment.

And then one of the spouses gets a raise like, oh, we can move

to the $3,000 apartment now.

And then the other one gets a raise.

Oh, now we can move to the upper East side.

We'll get the 35.

And so it's like as soon as there's any improvement in their, their income, it's.

Let's get a bigger apartment, let's eat out more.

It's sort of like, oh, now we can live better because we're earning more income.

As opposed to, no, like actually think about contentment in what you have.

Make modest improvements, right?

Maybe increase your spending a little bit, but like, think about how to increase

your savings when you get a raise.

And that's part of what you're talking about, the the not seal, the peas.

It's like, yeah, you've got access to this money now, but that doesn't

mean you should use it all to.

a, a big boat.

I mean, again, if that's part of your plan and it works fine, but you shouldn't

just, you know, loot the, the grocery store from his analogy because it's there,

Mm-hmm.

you own it.

Right.

right.

Yeah.

That's another rule.

In the five rules of IBC, which is that upgrading, upgrading, upgrading,

upgrading when I'm not quite ready to upgrade, you know, but I'm not

gonna tell the listener what it is.

I'm gonna tell you to go read Becoming Your Own Banker by r Nelson Nash and learn

all five rules, and you will understand more of what we're talking about.

I think that's a wonderful wrap, Paul.

How can people track you down?

How can people read more about what you're putting out there?

And you have some new things coming up too.

Sure.

Yeah.

Well, you know, Joe was talking at one point about kind of the every man, and

it's funny you should bring that up.

'cause the organization I work for is about speaking to the

every man and the every woman.

So it's the American Institute for Economic Research, AIER.

We're based outta Great Barrington, but we write a lot on what's going

on in the economy, what's going on in, in the political world, nuclear

power, trade, interest rates.

So that's where I do a lot of my work.

You can find it there at a IR we are launching a podcast that I'm hosting that

is coming out here at the end of January, and it's called The Economist Next Door.

It's conversations much like this, it's a little more policy focused, but

it's meant to be very conversational and accessible for people to hear

about what is monetary policy and like why does, how does it affect my life

and what I do, you know, mortgages, how does it related to the financial

crisis or, what's going on in, in, in.

I'm actually gonna have a conversation even today about a podcast, a little

insider baseball kind of politics, but thinking through the philosophy of

freedom, and there's been this tension historically of like, is freedom more

important or is virtue more important?

How much do I rely on reason?

To direct my life and how much do I rely on tradition and custom

Mm-hmm.

to direct my life?

And there's some deep tensions here that philosophers have

wrestled with a long time.

So I'm gonna talk with some of my former professors about this.

But anyway, the, the point is that podcast is gonna be out.

It's meant for, for people just listening who wanna understand a little bit.

What is going on with tariffs?

Like I hear a lot of different things about tariffs.

Is it good for me?

Is it bad for me?

Is it helping manufacturing come back?

You know, what's going on in the Medicaid world?

You know, I know there's this big beautiful bill and I think they

were cutting Medicaid spending, but like, why were they doing that?

I. What, what implications does that have?

So it's meant to be very kind of tangible issues that people maybe have

heard of but just don't know that much about, and just having conversations

like this to kind of unpack it.

You know, I, I come from a little more academic background

so I can read the statistics.

I don't like doing them.

I much prefer just having a conversation.

Why does this matter?

You know, what does this look like?

What's going on here?

You know, I used to be a professor and so I love to explain things

and help people kind of understand.

This world that we live in, you know, it's complicated, but it's also beautiful

and interesting and it's good to, to try to understand what's going on so that we

don't walk around in a fog or feel like things just are happening to us or that

we don't have any kind of agency here.

I think we have a great deal of agency and.

Again, understanding how things work is a part of that.

So, sorry, I'm going on another monologue here, but you can find my work there

at AIER, the Economist next door.

I do have a substack Paul D. Mueller, if you look that up there, and it's

intermittent, usually book reviews and things I'm thinking about.

So, and then I have a bed and breakfast in the mountains of Colorado.

So if you're looking for a place to get away, you can look up the Abbey.

Get up, get up to the Abbey at high altitude.

I.

That's right, very high altitude.

This is, this is good.

I, I enjoyed this and I'm so glad that you're on with us today.

Yeah, it's been fun.

Thanks for having me.

Yep.

All right.

This is Make Your Wealth Work.

Again, a big thank you to Dr. Paul D Mueller for the conversation.

If you'd like to connect with us, if you'd like help, just figuring out what

tools you need, like we talked about.

I mean, if you're.

Going from screwdriver to hammer to power tools.

Let's help you navigate that way.

Or if you need the big workbench and the drawers and everything, let's

help you navigate that direction.

So head on over to alphaomegawealth.com/podcast to reach

myself or Joe and schedule a call.

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Until next time, you guys take care.

We'll talk soon.