➡ Mark Moss, an experienced investor, warns that the financial system is rigged to benefit financial advisors more than the investors themselves. He explains that due to the shift from an equity-based system to a debt-based system, the value of money is constantly decreasing, forcing people to invest. However, the financial advisors or fund managers often prioritize their own profits over the investors’ interests. Moss encourages individuals to take control of their own financial future and not rely solely on advisors.
➡ The article discusses how traditional 401k plans and mutual funds often have high fees and underperform compared to benchmarks like the S&P 500. These fees can significantly reduce your returns over time, with fund managers benefiting more than the investors. The article also highlights the importance of managing your own money and investing in areas you understand and are interested in. It suggests that the real rate of inflation is higher than what is typically reported, which can further impact your investment returns.
➡ The speaker advises investing in businesses, including your own, and in the ‘quantum wave cycle’ – a pattern of technological advancements that occur every 50 years. Currently, this includes areas like Bitcoin, AI, and other decentralized technologies. He also recommends investing in real estate for tax benefits and steady income. He emphasizes managing your own investments, rather than relying on fund managers, to keep more of your profits.

Your financial advisor is driving your yacht, and it’s time you take it back. Now, in today’s world, you’re forced to invest just to preserve your wealth. But the problem is, the game is rigged. The very people you trust to guide your financial future are making moves that benefit them more than you. And the worst part? Most people don’t even realize it’s happening. So, in this video, I’m going to expose how the system is stacked against you, and how your advisor might be profiting at your expense. But more importantly, I’m going to show you what you can do to flip the script, to protect your wealth, and grow it faster than they ever will.

Faster than they can. And by the end, you’re going to be ready to take back control and steer your financial future towards real freedom. Now, real quick, if you’re new to the channel, my name is Mark Moss. I’ve been investing now through four economic cycles, booms and busts. And after building multiple businesses and having two high value exits, I got wiped out in the OA great financial crash because I was listening to traditional financial advice. Now, after building it all back in a fraction of the time, I’ve now been writing my own financial newsletter for almost nine years.

I’ve coached thousands of investors to build wealth faster without the old outdated advice, and I’m a partner at a leading tech BC hedge fund. So grab a pad, grab a pen, and let’s go. All right, so today we’re going to talk about unveiling the scam of what’s happening to most people. And hopefully, it’s not happening to you. But if it is, I’m going to show you how to get out of it. Now, the first thing is I’m calling this the investing industrial complex, you know, sort of like the military industrial complex or the pharmaceutical industrial complex, or now we have the censorship industrial complex.

And yes, this is another complex that is geared to take advantage of you. But it doesn’t have to be that way. But first, let’s understand the system. So because in 1971, we went from what’s called an equity based system, a goldback system to now a debt based monetary system, that means that the debt always has to continue to grow. Because of that, they have to add more debt to roll over the existing debt. And because of that, that means the money supply continues to expand when the money supply continues to expand the existing dollars you have in your bank account by less and less and goods and services.

So that’s why you can see this is a chart of the government, the debt, and you can see these trend lines and it’s going steeper. And you can understand that it’s exploding. So we had this trend line here, then the trend line started going up, then the trend lines are going up, and how much more can that trend line go up, we’re going to be going almost straight vertical. And so this is what’s happening with the debt because the money supply has to expand. Now because of that, your money buys you less and less and goods services.

This is showing the percentage of GDP that wage earners make up. So if you’re a wage earner, you know, W2 employee, the percentage of GDP for you is going down and down and down. That’s not a good thing. Your purchasing power is going less and less and less because of the money supply continue to expand, and they’re printing more and more money. And it looks like this, as the cost, the CPI consumer price inflation goes up, the cost of everything’s going up. The reality is that your purchasing power is actually going down.

So you have to understand like this, things aren’t getting more expensive, it takes more dollars to buy those things. Now, you probably already know this, especially if you’re watching my channel, the reason why I’m saying this is because this is how the system has to work. And this is why you’re forced to be an investor. Now, doesn’t have to be this way, we can talk about a sound money system, we can get back to that. But let’s just think about this for a second, right? In the age of capitalism, we’re able to specialize, I no longer have to grow my food and build my house and make my clothes, I could specialize and be the very best I could be at that role.

I could be the very best brain surgeon or cancer researcher, but I can’t, because now I’m forced to be a cancer researcher or brain surgeon, and I have to be an investor. And if I’m half investor, and I’m half brain surgeon, I’m not very good at either. And so because I’m forced to invest, one, think about the loss of production and value of the world is that because of that, but number two, I only have two options. Well, one, I could not invest, but I have to. So I have two options, either one, I can spend half my time trying to figure out investing, or number two, I can give my money to Wall Street, to the investing industrial complex.

So this whole system was set up to benefit Wall Street, you know, your funds, your fund managers and all of that. But here’s the problem. The problem is that while you should be having a better life, and your quality of life should be going up, and you should have a yacht. The problem is your fund managers driving your yacht. And who’s your fund manager? Well, if you put money into a mutual fund, or a 401k or an IRA, an index fund, you have a fund manager. And the problem is, as I said, they’re driving your yacht.

Why is that? Well, there’s a few reasons why the first thing we need to understand, though, is that your incentives and their incentives are misaligned. You see, when I hire people for my business, like sales, people that drive revenue, you know, sales marketing, I typically want to pay them on performance. And if I pay them on performance, if you sell products for me, I will give you a percentage back of the revenue. And that way, our incentives are aligned. If you make me more money, you make more money, right? And we win together.

The problem is that’s not how it is for your fund manager. You see, fund managers get paid in different ways. And they mainly get paid in one of two ways. Number one, they get paid by managing your money. So the longer they can keep your money, the more money they make, which is why they tell you things like, there’s no such thing as timing the market, it’s always just time in the market. So just leave your money in right when the markets are going down. No, no, no, don’t pull your money out.

You’ve seen the movies of like the big short and things like that when the markets are plunging, the stockbrokers are on the phone trying to calm their customers down. Don’t take the money out because they need to manage your money. Number one, number two, they’re not really financial advisors as much as they are sales reps that sell their company’s products. Let’s take a look. So we can see that the mutual funds in your plan are often chosen for the wrong reasons. What does that mean? Well, you don’t have the same reasons.

So a 401k providers make huge sums of money from kickbacks. See their sales reps. So when they sell their company’s products, they make a lot of money. And some products make them more money than others, regardless if it’s good for you. Your 401k plan is packed full of expensive actively managed mutual funds, hoping to beat the market hoping we’re going to get back to this specifically, hoping to meet the market. But the studies overwhelmingly show that in due time, they will often lag the market. So they’re putting into products that are overvalued so they can get huge kickbacks and they’re going to underperform the market anyway.

Most plans do not offer access to low cost index funds because why? Because they can’t receive kickbacks. They don’t want to sell you those the good ones because they don’t make as much money sort of like that movie Wolf of Wall Street, right? He went to go set up his own shop selling these pink sheets, which are basically garbage. Why? Because they have huge kickbacks on them. Okay. Here it says that one plan we reviewed offered index funds with a 3000% markup, 3000% markup from its normal retail price. So this is what they’re doing.

Their sales reps, they’re not aligned with your incentives. Okay. Now, what most people don’t really understand is something that’s called the expense ratio. So this is something you need to figure out if you have money in any type of these funds, managed funds. So the expense ratio basically breaks down to administrative fees, asset management fees, and marketing fees. You got to pay all those. So all of those added together are the expense ratio. And what most people get completely wrong about how this expense ratio is that, for example, you think that, well, I have to pay one to 4%.

I have to pay a percentage and they think it’s on, for example, your profits, but it’s not it’s on the whole amount. So regardless of how much you make or how much you lose, you’re paying a lot more than you think you are. And what happens is over time, this adds up to a lot. So for example, if you’re paying 3% fees over 30 or 40 years, you could pay 68% of your returns to your fund manager, which is why they’re driving your yacht. Now let’s take a look and put this into some numbers so you can understand how this is affecting you.

So what we can see here is what when you utilize a traditional 401k plan, which represents 95% of the plans in existence. So yes, you probably have that right now. We can see that just 1% in excessive annual fees can really add up. How much does it add up? Well, we can see in this hypothetical example here is that by starting with a balance of 1 million and changing the fees by just 1% on a 7% annual growth rate, the difference is a million dollars, 1.1 million dollars. That could buy you a yacht, but it didn’t because you understand how much you’re paying fees and your fund manager got that.

Okay, let’s give you a couple of other examples. Now, like I said, the fees typically range from 0.6 to 4%. So, hypothetically, if you were to put about $10,000 invested into your plan over your normal working career, let’s say 35 years, that could at a normal, you know, 7% rate compound to about $148,000. That’s really good from 10,000 to 148,000. That’s the number they show you on paper. But the problem is that out of that, you would keep only about $45,000 while your fund manager gets to keep about, well, that’s messed up about $103,000.

So you got 43, they got 103. You took all the risk. They made all the commissions. Hmm, doesn’t seem really fair, does it? They end up with more, which is why they end up driving your yacht. Now, one other thing I want to say about this real quick is that you end up with 45 and you still get to pay taxes on that. So think about that for a minute. I don’t know what your tax rate is. I don’t know what state you live in or what country, but you got to think about that.

Okay, now, hang on. It doesn’t get better. It gets worse. So something I’m calling the Great Fakening. You guys heard about that book, The Great Taking. A lot of people ask me about that. People want me to make a video about that. Drop me a comment if you want me to make a video on the Great Taking. But I’m calling this the Great Fakening. And with the Great Fakening is basically where everyone’s measuring against a benchmark of the S&P 500. So when you look at the performance of these funds, the mutual funds, the 401k funds, they’re all underperforming.

As a matter of fact, about 90% of mid cap and large cap mutual funds are underperforming their benchmarks. But the problem is the benchmark is set on an S&P 500 index, which is about seven or eight percent, depending on what timeframe you measure it in. But the Great Fakening is the fact that while the S&P 500 is the benchmark, and they’re all underperforming. As a matter of fact, you can see this right here. Here’s a scorecard of mutual funds from 2023 to 2024. And you can see that 88% are underperforming. Underperforming what? Underperforming the S&P 500 index.

We can see right here, I pull this up on Cora, it says in three years, my 401k retirement plan is consistently consistently having a return of 1.5%. So it’s underperforming the benchmark by 88% or 90%. So you’re getting about 1.5%. That’s bad. But again, underperforming the benchmark, but the benchmark is the problem. So let’s break this down. The problem is that the S&P 500 looks like on paper, it’s gone up. So well, it’s averaging 70%. I turned 10,000 into 145,000. That’s good, right? But then why do I feel broke? Why don’t I feel like I’m more wealthy? Well, partly because your fund manager is taking a big piece of it.

But more importantly, it’s because you’re not adjusting the S&P 500 gains for real inflation. And I say real, because what your fund manager will show you is adjusted for CPI inflation, which is 2%, 3%. The real rate of inflation, if you watch my channel regularly, you know this, the real hurdle rate is really around 15%. It’s the rate of debasement since 2019. The monetary base, the money supply has expanded by 10% a year since 2019. Since 2020, 10% a year, how much are homes up in the United States? About 40%. How much is the S&P 500 up? About 40% or 50%.

How much gas is the lean up? How much is stake up? And you’re starting to see the rate of debasement is the real inflation number. So what we do to see this the real way, not the way the government shows it to you or your fund manager, is we take the S&P 500 and we divide it by the money supply. And warning, disturbing chart. What we can see when we do that is that the S&P 500 has not made a new all time high since the year 2000. As a matter of fact, it’s down 22% since the year 2000.

That means that if you put all your wealth in the S&P 500 in the year 2000, it buys you 22% less goods and services a even though on paper, it looks like you’ve made a lot. Now that you understand this, and then you understand that your mutual funds that your fund manager has you in are underperforming this by 90%. And it’s no wonder why the quality of your life is not getting ahead. Now, that sounds bad. Oh, and I didn’t say I forgot to say this part. This is exactly why Ray Dalio is having the great fall from grace, if you will.

Ray Dalio was the greatest investor in the world. Bridgewater Capital, the biggest fan of the world. Tony Robbins is writing books about Ray Dalio, right? Except for the problem is that his famous trade is sputtering and investors are bailing. As a matter of fact, he’s had over $70 billion in redemptions. That means people pulled their money out in the last 36 months. His fund, his famous trade doesn’t work. And as a matter of fact, it hasn’t really worked since 2008. And the problem is, even if it did work, it was still using the wrong benchmark, which is why none of this is going to work for you if you really want to increase the value of your life.

Okay, so enough with the bad news. Let’s get to the good news. So then what, what are you going to do about it? Well, what we should be doing instead is number one, managing our own money. Yes, manage your own money. Now I know this sounds counterintuitive because the Wall Street, the investment, the investment, what do they call it? Oh, the investment industrial complex has made it seem so complex that you have to work with them. But the problem is we should be managing your own. Think about this. Think about how much time you spend going to school, 12 years, university, four or five years, I don’t know, PhD, masters, whatever, add that up.

Then you’re in your career. How much time have you put into your career, extra seminars, things like that, working late to get your advanced script, you put hundreds, thousands, tens of thousands of hours into figuring out how to make money. But how much time have you put into what happens with your money after you make it? You see, most people spend tens of thousands of hours to make money or make more money. And then what, just give it to a fund manager and whatever happens happens. Why wouldn’t you spend 10 hours or 100 hours figuring out how to manage your own money? It’s not really that hard.

Not as hard as they make it seem, especially when you can just follow other expert advice, people like me, or I give you information. Okay, now the key to this is stick to your core competency. If you follow Warren Buffett at all, he’s a pretty good guy to follow. He’s made a lot of wealth. He talks about sticking in your deal box. This means that I’m only investing into my core circle of competency. That means things I know, things I understand, things I like, things I’m interested in, because now I’ll do better.

Legendary hedge fund manager, Peter Lynch said that the average person could beat Wall Street if they just walked down Main Street, saw the products they liked and bought those instead. So they’re buying things that you know, like and understand. Now, I typically think about three different positions. Number one, start with investing in a business. Now, technically, all investments are businesses. So you think about Warren Buffett. Warren Buffett said that I don’t buy stocks. I only buy businesses, they just happen to be publicly traded. You see, he doesn’t think about buying stocks, he thinks about buying a business.

And so whether it’s a small mom and pop business down the street, it’s your own business that you start up or big businesses think about investing in a business, and specifically your own business that you can grow. Number two, I like to invest in what I call this quantum wave cycle. If you’ve been following me, you know what that is, the quantum wave cycle is every 50 years, there’s a new batch of technology that shifts the direction of the world. And it’s the only place really to invest. If you want to make, you know, 20, 30 times, 50 times returns on your money, then you need to be invested into these assets.

And that right now is decentralization, Bitcoin, cryptocurrencies, AI, things like that. If you want to know more about that and like how this cycle works in four phases and the assets that we’re buying, I’m going to be doing a live presentation breaking all this down next week. I’ll show you the four phases, how we’re going into phase two right now, and what assets I’m buying right now to position myself for that. It’s all free. I’ll put a link down below if you want to come hang out, open up Q&A, you can ask me whatever questions you want.

So check that out. I’ll put a link down below. So business in this quantum wave, in this technology, and then I invest in the real estate. I invest in the real estate for tax efficiency, and for cashflow. So each part of this has a little bit to do with different parts of my portfolio. But the key piece is I manage this. I don’t have a fund manager holding my hand on real estate. I don’t have a fund manager holding my hand on these technology assets I’m buying, or on the businesses that I start.

Now I have mentors, I have coaches, I have a business coach, right? I coach people on investing through these cycles, I have a fund as well. And then I manage my own real estate. And I also have mentors in real estate as well. But the key is that I manage my own. And while I may pay thousands of dollars here and there, they’re not driving my yacht because they’re not taking 50, 60 or 80% of my profits. So the key is take control. That’s what you got to do instead. Don’t let your fund manager drive your yacht.

I’d much rather see you driving it and have your quality of your life go up. So let me know what you think about that. Give me a thumbs up if you liked the video. If you don’t, you can be thumbs down. That’s okay. At least tell me in the comments why I’m always trying to give the best value that I can for you subscribe. If you’re not already subscribed, and that’s what I got right to your success. I’m out. [tr:trw].

See more of Mark Moss on their Public Channel and the MPN Mark Moss channel.