#OWNR.LIFE with William Eastman

for the Mike King Network

I thought today's show should break from discussing economics in the abstract and focus on pulse taking. We are going to look at the numbers for the United States as of offical July 2022 reports and see if there is a theme. ​ For definitions, reference show FOUNDER SERIES: S10.2. The one thing to remember with all statistics - one data point is #$%@ happens. You need at least 3 data points to establish a trend. Here is the data from July 2022 for the United States. Next report will be global. ​ Green or Positive: 7 (35%) Black or Neutral: 2 (10%) Red or Negative: 11 (55%) EPISODE 17: Leading Economic Indicators Yield Curve: 2 Year 3.10, 10 year 2.73 Durable Goods Orders: +1.9 Stock Market: +9.22% Manufacuring Jobs: +30,000 Building Permits: 1690 (neutral)

EPISODE 18: Real-Time (Coincident) Indicators Manufacturing Activity: 52.2 Short-Term Interest Rates: 2.37% Inflation: 9.1%

EPISODE 19: Trailing (Lagging) Indicators Gross Domestic Product (GDP): - Q1: -1.6, Q2 -.9 Unemployment Rate : 3.6%, Labor Utilization Rate: 62.1% Balance of Trade: $79.6 billion (improving)

EPISODE 20: Taking the Economys Pulse PPI (Producer Price Index): 11.3% CPI (Consumer Price Index): 9.1% CCI (Cusumer Confidence Index): 97.5% Interest Rate: 2.37% (raise 5 times since March - .25, .5, .75, .75, .75 = 3%) Energy ​Natural Gas: 11% Gasoline: $4.66 (down .40/gallon) Diesel: $5.49 (down .06/gallon) Coal: .89%

Today I intend to take on all the sacred cows, the myths the perpetuate economic lies. If you follow IBGR.News, it is obvious we are capitalists - entrepreneurial capitalists to be exact. We believe that the 380 million small business owners who employ 57% of the planet are the most important community. EPISODE 21: They Keep Us Stupid on Purpose I know this an inflammatory statement to start a show, but it is true. The reason for the statement is simple. If you could intelligently decipher the BS espoused by politicians, thought leaders, and media talking heads. Imagine the second a legislator or prime minister makes a ststement about the latest policy, you could smell the #$%^ over the TV or radio? They need you stupid to sell what doesn't work - or least the vast majority of pundits.

EPISODE 22: The 10 Myths - 1 to 5 I scoured the internet and found several great lists of capitalism myths. It was compile by people who understand economics and have a historical perspective. One of things that makes the 'dismal science' understandable is looking at prior economic decisions and the subsequent impact. Topics: Capitalism Was Created Capitalism Creates Poverty Capitalism Is Unstable Capitalism Creates Obscene Profits Capitalism Creates Misinformation

EPISODE 23: Myths 6 to 10 Wasn't that fun? Hope fully I punctioned a few myths and if you don't believe me - do it for yourself. The easiest place to start is look at the following recessions / depressions and policy decisions - what happened? Topics: Capitalism Leads to Environmental Destruction Capitalism Led to a Concentration of Power Capitalism Leads to Globalization Capitalism Led to Lower wages and Benefits Capitalism Rewards Racism and Segregation

EPISODE 24: How to Up Your Game This is on you. Nobody really wants you intelligent on the topic because you will call them out. ​ Topics: Listen to IBGR.News Read the IBGR.News Newspaper Reading List: Wealth of Nations - Adam Smith Economics in One Lession - Henry Hazlitt Creative Destruction - Joseph Shumpeter Road to Serfdom - Friedrich Hayek Follow the Mises Institute

Given the 20 dimensions we measure to create an economic outlook, the change from July to August is NO CHANGE. We are awaiting two statistics, manufacturing jobs and interest rates. The Fedral reserve has already predicted a bandwidth of .5 to .65% increase by the end of August / beginning of September. If that occurs then we will have 11 nagative indicators and either 2 or 3 neutral and 6 or 7 positive. For definitions, reference show FOUNDER SERIES: S10.2. If forced to provide an explanation, the answer remains we are in the early stages of a recession. With the announcements by major employeers of layoffs by the end of the year and a forecasted reduction in the PMI (Purchasing Managers Index), these events will accelerate the contraction. By the end of the year the picture will be clear. (JULY)​ Green or Positive: 7 (35%) Black or Neutral: 2 (10%) Red or Negative: 11 (55%) (AUGUST) Green or Positive: 6 (30%) Black or Neutral: 4 (20%) Red or Negative: 10 (50%) EPISODE 29: Leading Economic Indicators Yield Curve: 2 Year 3.10, 10 year 2.73 (JULY); 2 Year 3.421, 10 Year 3.039) spread increased by .012% (AUGUST) Durable Goods Orders: +1.9 (JULY); +.9, decrease of 1% (AUGUST) Stock Market: +9.22% (JULY); -1.95, a decrease 11.12% (AUGUST) Manufacuring Jobs: +30,000 (JULY); not available Building Permits: 1690 (neutral) (JULY); decreased by -1.3% (AUGUST)

EPISODE 30: Real-Time (Coincident) Indicators Manufacturing Activity: 52.2 (JULY); 51.3, decreased by .9 (AUGUST) Short-Term Interest Rates: 2.37% (JULY); not available, expected .5 - .75% increase ( AUGUST) Inflation: 9.1% (JULY); 8.5%, decrease of .6% (AUGUST)

EPISODE 31: Trailing (Lagging) Indicators Gross Domestic Product (GDP): - Q1: -1.6, Q2 -.9 (JULY); not available until October Unemployment Rate : 3.6%, Labor Utilization Rate: 62.1% (JULY); not available (AUGUST) Balance of Trade: $79.6 billion (improving) (JULY); not available (AUGUST)

EPISODE 32: Taking the Economys Pulse PPI (Producer Price Index): 11.3% (JULY); 9.8%, decrease of 1.5 (AUGUST) CPI (Consumer Price Index): 9.1% (JULY); 8.5%, decrease of .6% (AUGUST) CCI (Cusumer Confidence Index): 51.5 (JULY); 55.1, increase of 3.5 (AUGUST) Interest Rate: 2.37% (raise 5 times since March - .25, .5, .75, .75, .75 = 3%) (JULY); not available, expected .5 - .75% (AUGUST) Energy ​Natural Gas: 11% (JULY); 7% increase fromJuy, 14 year high (AUGUST) Gasoline: $4.66 (down .40/gallon) (JULY); $3.99, decrease of $.67 (AUGUST) Diesel: $5.49 (down .06/gallon) (JULY); $4.91, decrease of $.58 (AUGUST) Coal: .89% (JULY); 3% increase (AUGUST)

EPISODE 40: WHERE WE ARE TODAY AND WHAT TO EXPECT NEXT MONTH Good: 4 (13%) Neutral: 4 (13%) Bad: 18 (60%) ​No Data: 4 (13%) Total: 30 Our analysis: given the 3 Quarters of negative GDP growth, it fits the technical definition of a recession. Looking at manufacturing activity and therefore jobs, we are at the beginning of the contraction. Left alone by the government, the market can cleanse itself in 6-8 months, certainly within a year. However government will not resist the political pressure to do something and that will lead to distorting the contraction. Remember the goal of a contraction in the business cycle is remove bad investing decisions (all uses of capital) to bring a balance between demand and supply, between the value of something and its price.

EPISODE 39: TRAILING INDICATORS Trailing Indicators July August September GDP Q1: 1.6- Q2: .9- Q3: .01- Unemployment Rate 3.5 3.7 ? Balance of Trade $79.6B ? ?

EPISODE 38: REAL-TIME INDICATORS​ Real-Time Indicators July August September Manufacturing Activity 52.2+ 51.3+ 51.6+ Short Term Interest rates 4.229% 4.962% 5.320% Inflation 9.1% 8.5% 8.3%

Like last month's show, we have used the latest numbers from the US govrnment for our analysis. If you have been following the new, especially IBGR.News, the picture isn't pretty and the contraction has just started. For definitions, reference show FOUNDER SERIES: S10.2. If forced to provide an explanation, the answer remains we are in the early stages of a recession. With more announcements by major employeers of layoffs by the end of the year, a forecasted reduction in the PMI (Purchasing Managers Index),and the #rd Quarter in a rom of negative GDP, these events will accelerate the contraction. By the end of the year the picture will be clear. One additional note, we have recalibrated our numbers as the govermen has adjusted the numbers. Today we are using 'official' numbers as it is available. EPISODE 37: LEADING INDICATORS​ Leading Indicators July August September Yield Curve 2yr - 3.10 ​10yr - 2.73 2yr - 3.42 10yr - 3.04 2yr - 4.168 10yr - 3.703 Durable Goods 1.9+ .9+ 0.0 Stock Market 8.39- 9.11+ 4.42-​ Manufacturing Jobs 12,794 12,852 ? Building Permits 1890m 1517m ?

After surviving 4 previous recessions, we have learned there are several things you can do to not only survive, but use it to strengthen your core. Topics: Cash Flow Management Lowest-Cost Producer Holding Your Best Accounts

Regardless of your motivation for starting a business, it needs to be treated as an asset. For most entrepreneurs, it is their primary or only asset having invested their future in its success. There is an old saying in the stock market that you cannot fall in love with a stock, otherwise you will trade it when its performance demands it. That is not true for your business. You must love it and bring passion to improving it every day or it will fail. It is not a stock to be sold! Topics: Your Business - A Job or an Asset Invest in the Business Like an Investor Growth Only Comes from Productivity

The business cycle is easy to understand. Every 8 - 12 years, an economy goes through an expansion and contraction. An expansion follows a contraction where the economy has been cleansed of bad capital or investment decisions. Consumer attitudes change from fear to exuberance. People perceive good times are back and they start buying - demand. Businesses read this shift in attitude and begin increasing production, creating new products and services - supply to meet the demand, and what is the trigger? When demand exceeds supply, it drives up the price and invites more investments in those areas. At some point, the prices reach an equilibrium point which starts the bubble phase. Bubbles are nothing more than an overproduction of goods and services because the feedback loop is slow. By the time businesses realize they have over produced prices are already falling apart and they are stuck with inventory (labor) nobody wants and the bubble bursts. Topics: The Business Cycle The Price Mechanism The Inevitability of Bubbles Why Bubbles Burst?

Today we are taking a break from interviews and focusing on the global economy. Once a month we stop and look at what is going on - to borrow the song title from Marvin Gaye. Although today's show is a lesson about monetary policy in the United States, the example works for almost every country in the world. As the world becomes more interconnected, the same philosophy drives decision making in London, Brussels, and Beijing. If you take every country in the world and look at monetary policy since the Great Recession of 2008-2010, they printed and added $35 trillion dollars to the global money supply and that represents 50% of the world's GDP ($85 trillion). Since the root of inflation is the over-printing of money, which devalues the purchasing power of a currency, that money must be extracted from circulation. Why is it a problem? Because when you distort the value of a currency, you distort prices. If a currency is inflated, the prices of all products and services, by definition, must be increased. Since any market that operates on some market basis uses price as a signal to produce more or produce less - you create artificial stimulation. The increase in price is a signal to produce more if you are in a market or to jump into a market. This usually turns into a disaster for those companies that act on price signals - and we all do. This sounds complicated, but it really isn't. EPISODE 21: Our Distorted Economy The essence of the problem is that there are VERY TRUE market economies, economies that would be considered capitalist. Today, most economic models are a blend of capitalism, state corporatism, and modern monetary theory. This is a witch brew that will lead to economic devastation globally. Topics: Will this lead to a global recession? (Destruction of the dollar as a reserve currency, high price for energy due to policy, the inability to reduce the money supply) How long will the recession last? (government action distorts the business cycle, 18 months at least instead 6-8 months, ) What should governments do to solve the problem? (bring down inflation by reducing the money supply, accurately measure inflation - it is not a social construct, dealing with sovereign debt, abandon a central planning mindset)

Fero Vernon COO of WrittenWord Media https://www.writtenwordmedia.com/ Segment 4 Ferol shares some of his favorite stories and his secret to growth - hiring the right people and building an atmosphere of trust and learning.

Fero Vernon COO of WrittenWord Media https://www.writtenwordmedia.com/ Segment 3 Since they were handling a wide variety and range of book types, their scaling for growth was to develop 5 different sales channels to build a coherent brand and grow sales.

Fero Vernon COO of WrittenWord Media https://www.writtenwordmedia.com/ Segment 2 His startup story was once they figured out how to sell books, an author asked if he could advertise on their platform - and that created the company today.

Fero Vernon COO of WrittenWord Media https://www.writtenwordmedia.com/ Segment 1 Ferol explains how he was doing a favor helping an author sell a book without success and that started him in the business; how does this work?

Greg Mohr Founder and President of Franchise Maven https://www.franchisemaven.com/ Segment 4 Greg shares his success stories as a business owner and the stories of other owners selecting the right franchising option.

Greg Mohr Founder and President of Franchise Maven https://www.franchisemaven.com/ Segment 3 Like segment 2, in this segment Greg discusses the two growth options available to franchising: horizontal - open more locations or vertical - creating a franchise.

Greg Mohr Founder and President of Franchise Maven https://www.franchisemaven.com/ Segment 2 Greg contrasts the challenges of the startup phase for the individual business owner with purchasing a franchise and having guard rails on a path to success.

Greg Mohr Founder and President of Franchise Maven https://www.franchisemaven.com/ Segment 1 Greg shares his progression from engineering to his first experience in business - buying into a franchise. This transition helped him give back to other budding entrepreneurs by starting a franchising company.

Dominic Daniels Regional Vice President, NMLS & PrimeAmerica https://www.primerica.com/dddaniels&origin=customInvest Segment 4 Dominic closes the interview with success stories of building wealth an helping others achieve their dreams.

Dominic Daniels Regional Vice President, NMLS & PrimeAmerica https://www.primerica.com/dddaniels&origin=customInvest Segment 3 Dominic shifts gears and covers the difficulty of scaling a bus9ness and the seret he learned - the selection of people.

Dominic Daniels Regional Vice President, NMLS & PrimeAmerica https://www.primerica.com/dddaniels&origin=customInvest Segment 2 Dominic discusses his lessons learned from the early stages of being in business and lessons he learned growing his operation.

Dominic Daniels Regional Vice President, NMLS & PrimeAmerica https://www.primerica.com/dddaniels&origin=customInvest Segment 1 Dominic covers his journey from an enlisted airman in the USAF to becoming a wealth manager of individuals and business owners as well a successful business owner running a major investment practice

7. Who Should Work There? I will make the case that an organization that has self-management as a goal taps into the natural yearnings of people; there is nothing unnatural here. Everybody, well almost everybody, wants to be successful and perceived as competent. This is driven by a hierarchy of needs that once met (not completely satisfied - just enough) the individual moves to a higher level - exactly what we are trying to do with the business. 8. What Is The Payoff The payoff is simple, to create the systems and processes to make self-management possible forces extreme levels of clarity and executives who can focus on their role - the long term health of the business.

4. Scheduling and Performance Autonomy By emphasizing skill mastery and providing real time data, we expect people to act before being told. Because we know the individual or work group is competence and has accurate data to react on, we have minimize risk of uncoordinated activities. 5. Pay4Performance The only true measure of business performance is profitability, not revenue. It doesn't matter how much money flows in; it is all about what is left in the cigar box. If it is true about you as the owner why should it be different with anybody else. Tie all of your compensation to how people impacted the amount of money left in the bank. 6. Share the load Get everybody into the game, the great game of business. Most people work in environments where they are forced to bowl with a sheet over the lanes. Imagine the only feedback you receive is noise without knowing how many pins were knocked down or where? And where do you throw the second ball? Why are you the only person losing sleep at night because the company is not performing?

1. Clarity on the End Game. The Vision, Mission, and Values of the company are clear and enjoy universal commitment from the workforce. The real end game is what culture are you trying to create? 2. Line of Sight to Business Objectives. The yearly business Plan This is where your use of MBO is critical. Managing By Objectives requires everyone has a piece of the action, an expressed part of this periods business objectives. 3. Ongoing Feedback on Performance and Results Although on occasion this is feedback delivered by an immediate supervisor, to make this work feedback on their performance (progress and/or results) needs to be delivered by the system. Consider the 80/20 rule as a great place to start.

Today I am wearing only the E hat - Executive. Since I started on this journey over 43 years ago, the first 2/3's of my career was consulting with the C Suite (CEO, COO, etc.) on building a sustainable organization that could also achieve rapid growth. S11 E5 The Self Managed Organization Once a business gets to a certain size these two objectives seem to be mutually exclusive. Based on that experience I built a collection of business rules that when combined created high performing, fast growth companies that had long futures. This is my story. I have a different view of things than traditional media and consulting. The lessons we learned turning around a small radio station taught me two things: I love the industry, and it has no future. Loving the industry satisfied a need that was decades old. Answering the question of how do we bring corporate consulting to where it will have the greatest impact - small business? It was obvious the medium of audio, broadcasted globally, could reach the 375 million small business owners employing 57% of everyone in the private sector. Finally, after years of working on finding a business model and delivery method, I had the answer. Radio, AM in particular, is a bandwidth without a profit model. The last 3 decades of syndicating political speech and automating radio stations were spent. What if we used the radio spectrum and the internet to niche the market and provide insights and tools critical to starting, growing, and exiting a business? What if the radio was the plumbing bringing water to your house, and the water was consulting? This different approach is instilled in everything we do at IBGR. Our principles are to provide entrepreneurs with everything they need to build generational wealth and create jobs regardless of their geographic location. Everything we do is demand-based; what is required to start fast and successfully, what is required to scale the business with growth that can be sustained, how does the owner achieve their end game. As serial entrepreneurs, we understand owners need to feel connected. All of us want feedback and control. We want instant response to decisions and the agility to implement. We want the ability to deploy resources efficiently and accelerate momentum to create quick wins. At IBGR, we understand the relationship between the owner and their business, their investment and risks in this act of creation.

The last Economic Show we did was on November 11th and we discussed how government intervention distorts economies. The focus there was for any market economy to operate it has to have accurate information on price. The government's intervention distorts price and therefore making all of the decisions businesses and consumers make wrong - the creation of disastrous bubbles. Today's show will focus on what we can expect in 2023. We don't have a crystal ball or claim the power of prophecy. Rather we look at past behaviors of the people and institutions that shape economies and assume these approaches will continue. Never forget the past predictor of future behaviors is the past. EPISODE 25 - THE GLOBAL ECONOMY The outlook is gloomy. Given the policies that have been put into place since the last recession, 2008-2010, world governments have kept interest rates almost at zero. That is the interbank leading rates which means if they place a traditional 3% margin on top of the loan, most business loans were artifically low. This meant credit was too cheap. Also, because of excessive spending and building unsustainable sovereign debt, this contraction was inevitable. All of the factors are present for a recession: rising prices, unemployment, and declining GDP. The only question is will be there a world-wide recession or isolated recessions bringing growth down.

There are many ways of computing inflation, but the universal metric is a mixture of PPI, CPI, CCI, and employment. The PPI is the Producer Price Index and it is a measure of the costs producers are paying to deliver the products and services the sell. Another valid metric is the PMI - the Purchasing Managers Index. It measures their confidence in purchasing more raw materials (production) based upon purchase orders they are receiving. Both is these are leading indicators - what will happen. The CPI is the Consumer Price Index and measures what consumers are paying. It is based on a basket of goods and services and measures how each item changes over time. This is a real time indicator - what is happening. A companion to this metric is the CCI. It measures how confident are consumers, based on the CPI, they are about the future. It has a direct impact on their willingness to purchase anything beyond the necessities. Unemployment is a trailing indicator and measures the impact of a downturn in manufacturing and series - if you don't have the work, you don't the employees. The reason most companies are reluctant to start here because of the costs of layoffs even though it is tempting to start here. Labor makes up about 30% of your costs and a controllable expense. The global forecast is inflation will continue until 1st or 2nd QTR of 2023 before beginning a decline. But that assumes the government and their central banks make the right moves.

Given our opening statement about the misuse of credit - making the cost of borrowing too low and hiding the moral hazard of taking on debt, inflation was built into their policies. This is also the major cause of economic bubbles. So what happens when inflation gets out of control? The standard response and one of several tools is to raise the cost of borrowing. By raising rates you make the borrower think smarter about the hazard of the loan especially if the market is contraction. This logical response harms a number of individuals and industries as unintended consequences. It destroys the housing industry: construction, real estate, etc. and the home owner. Suddenly your home is worth less and the number you can buy it shrinks because it is now outside their budget. In the United States we have raised the interbank rate to 3.75% and will increase it in 2023 to 5-6%. Now add the usual 3% margin banks place on top of what they pay you have interest rates at 8 to 10%. And that is for the best customers, imagine the impact credit card rates? The forecast for 2023 is the global interbank interest rates will stabilize around 4.25-4.5%. This is a world-wide number and what will happen in your country will be different.

Given our episodes today, we hit on different aspects of price, the supply chain is another place to look because of the supply / demand issue. Price, if we strip out all of the government distortion, is nothing more than a balance point between demand (people wanting to buy) and supply (how much of it is available). Here are 4 things to track to determine the supply chains impact on prices. Topics: Freight Costs Integrated Logistical Systems Congestion at the Pinch points Does JIT (Just In Time) really work or is it back to JIC (Just in Case)