Speaker 1: Welcome The Money in Wealth with John Hobriant, a production
Speaker 1: of the Black Effect Podcast Network and iHeartRadio. Hey. Hey,
Speaker 1: it's John Hopebriant, and this is the Money in Wealth
Speaker 1: podcast series on iHeartRadio on the Black Effect Network. I'm
Speaker 1: here to talk about something that I talk about or
Speaker 1: talk around what I remember talk to you on this
Speaker 1: podcast directly about. But it was inspired by the Time
Speaker 1: magazine article I just wrote a why and how seven
Speaker 1: hundred credit score just might change America. And I'm gonna
Speaker 1: be more practical in this conversation, but I want you
Speaker 1: to go to the Time magazine and read the piece.
Speaker 1: It's out this week. Credit scores have never been used
Speaker 1: to solve a social problem, as best I can tell,
Speaker 1: in the history of this whole country. And I'm coming
Speaker 1: at this thing with a movement of common sense. I
Speaker 1: believe this is the get it done party. I believe
Speaker 1: the new color is green. I believe the color has
Speaker 1: actually always been green as in US currency. Whether we
Speaker 1: argue about white and black racial issues and racism is real.
Speaker 1: Make sure that you clear that. I'm clear on that,
Speaker 1: whether we're talking about political issues red and blue underneath
Speaker 1: all this, If you're dazed out about God or love
Speaker 1: your days about money. So somebody's going to say, listening
Speaker 1: to this with John Bryant, you talk about credit scores
Speaker 1: and this sounds silly to me. You know, before I
Speaker 1: start talking about police brutality and racism and bias and
Speaker 1: discrimination and bad health and bad outcomes from social justice
Speaker 1: and all the stuff in communities. John Bryant, by the way,
Speaker 1: you're telling me that has to do with your credit score. Yes,
Speaker 1: I'll get to that, John Brian, what about slavery? Well,
Speaker 1: clearly there was no slave. There was no credit score
Speaker 1: in the eighteen hundreds, so I'm not stupid. There was
Speaker 1: no credit score in the seventeen hundreds or the sixteen hundreds.
Speaker 1: I'm not silly. But credit score is just simply a
Speaker 1: trimming indicator for hope, well being, faith, confidence, trust, belief,
Speaker 1: which I'll get to in a minute. Why that's important
Speaker 1: to an economy into your pocketbook. But underneath all this
Speaker 1: is the thing I'm really talking about, which is economics.
Speaker 1: And we live in a capitalist democracy, right, and there's
Speaker 1: good capitalism and there's bad capitalism. Like nothing's wrong with money.
Speaker 1: It's a love of money that's evil. So good capitalism
Speaker 1: is where I benefit and you benefit more. Bad capitalist
Speaker 1: capitalism is where I benefit and you pay a price
Speaker 1: for it. So slavery was bad capitalism. Inventing a hair
Speaker 1: comb that you could run through your hair or you know,
Speaker 1: or brush your hair with a brush, your hair comb,
Speaker 1: that solves a problem for you where you're getting real
Speaker 1: benefit of it and the price is negotiated in such
Speaker 1: a way that you're comfortable paying five, eight, ten dollars
Speaker 1: for that hair brush or hair comb because it gives
Speaker 1: you untold value. Well, that's good capitalism. An example of
Speaker 1: good capitalism stopping at a gas station. Maybe this is
Speaker 1: not a good example right now with gas prices, but
Speaker 1: typically that's good capitalism. Your automobile, you know, and autocar bill,
Speaker 1: your car notes like a house note these days. But
Speaker 1: if you've got a good deal in a car, if
Speaker 1: you like the car, it gives you, you know, a
Speaker 1: good feeling, a good emotion, protects you, it gives you tanpitation,
Speaker 1: delivers more value than you're paying for it. Again, good capitalism,
Speaker 1: because in that car are literally thousands of inventions, thousands
Speaker 1: of patents, hundreds, if not thousands of innovations that make
Speaker 1: up that audibolebil and autobile is today like a compute
Speaker 1: more than it is an old school automobile. And that's
Speaker 1: every piece of that every component of that car, all
Speaker 1: the thousands of pieces. Is somebody inventing something and creating something,
Speaker 1: innovating something, selling it to somebody else who then combined
Speaker 1: it with another innovation that then created something called mechanism.
Speaker 1: Call it a transmission, Call it an engine, Call it
Speaker 1: a wheelbase, call it sockets, call it casings, lubrication, etc.
Speaker 1: That then air conditioning, safety, security issues, air bags, all
Speaker 1: that stuff. Gearshift knobs, seats, cushions. These are all in
Speaker 1: separate innovations that come together to create what you call
Speaker 1: an automobile. And you purchase that automobile an accumulative price
Speaker 1: because you felt it was more valuable than what you're
Speaker 1: paying for it, or at least as valuables what you
Speaker 1: were paying for it. But what you pay for that
Speaker 1: car depends on your credit score. There are other variables,
Speaker 1: but it's primarily your credit score. And if you won't
Speaker 1: go in the hood where I grew up, and you'd
Speaker 1: buy a Mercedes from a car lot that is a
Speaker 1: second tier car lot, a B or a C car lot,
Speaker 1: not an a car lot at a manufacturer's car lot.
Speaker 1: But you go to a second tier buy here, pay
Speaker 1: here credit car lot, and I've done a podcast on that,
Speaker 1: and go back and watch or listen to that podcast,
Speaker 1: and you buy a Mercedes and the interest rate is
Speaker 1: eighteen to twenty to twenty five percent interest, which is
Speaker 1: common in the buy here, pay here a lot. It's
Speaker 1: not a Mercedes, it's Mercedes payments. So what I did
Speaker 1: in this Times piece is I laid out a thesis that,
Speaker 1: first of all, should get your attention and read the piece,
Speaker 1: share it with friends, let me know what you think,
Speaker 1: leave comments, but let's start a conversation. The primary thesis
Speaker 1: that gets your attention is that this makes you live longer,
Speaker 1: Like you live twenty years longer life. If you live
Speaker 1: in a seven hundred credit score neighborhood versus living in
Speaker 1: a five hundred credit score neighborhood five fifty credit score neighborhood, Yes,
Speaker 1: that's the drop the mic. I'm going to come back
Speaker 1: to this and say it again, but those in the
Speaker 1: back of the room, or say it one more time.
Speaker 1: If you live in a five hundred or five fifty
Speaker 1: credit score neighborhood, you live to sixty one years of age,
Speaker 1: you live in a seven hundred credit score neighborhood, you
Speaker 1: live to eighty one years of age on average. That's
Speaker 1: a twenty year difference right fifteen minutes apart. So this
Speaker 1: is really transformational for your mindset and then your life
Speaker 1: because once you understand how this game works, you can
Speaker 1: master it. But as long as you don't understand you
Speaker 1: playing a game, it's playing you. I'm want to come
Speaker 1: back to credit scores and go deeper into this conversation,
Speaker 1: but I want to talk now and pivot to something
Speaker 1: else that's playing you. If you're aspirational and young and
Speaker 1: trying to look successful, and that is flossing. Now be clear.
Speaker 1: I've got a nice watch on. People have commented on
Speaker 1: it before when I've done interviews. I find it fascinating
Speaker 1: people obsess on and focus on. But this is an
Speaker 1: insurance policy. If I ever need X dollars, I just
Speaker 1: take this watch off and can sell it. So it's
Speaker 1: an insurance policy. It looks nice all that stuff, but
Speaker 1: it actually either sustains its value or goes up in value.
Speaker 1: I have art it will sustain its value, and in
Speaker 1: many cases it will go up in value. I've got
Speaker 1: things that you know won't sustain their value. Some autobiles
Speaker 1: won't sustain their value. But I can afford to have it.
Speaker 1: And when I when I don't have to think about it,
Speaker 1: then I can buy it. Right. But if I got
Speaker 1: to think about and figure out how can I make
Speaker 1: that payment, and and my outflow seed my overhead. If
Speaker 1: my outflows hees my inflow, then my overhead is gonna
Speaker 1: be my downfall. I'm gonna be all stressed out and
Speaker 1: I shouldn't. I shouldn't have that car. If I have
Speaker 1: to ask what the payment is versus what the interest
Speaker 1: rate is, I shouldn't have that car and I won't. Right,
Speaker 1: So why am I giving this example? Because A there's
Speaker 1: a business model that we're not understanding for working class people,
Speaker 1: working for struggling people, middle class people, upper middle class people,
Speaker 1: even some who may come who don't come from wealth
Speaker 1: and uh and who maybe don't have the global exposure
Speaker 1: of how this capitalist model actually works. I want to
Speaker 1: break down why clubs like AO It's it's a club
Speaker 1: in uh In in Atlanta that just closed down. And
Speaker 1: maybe I shouldn't say it's name. I was trying to
Speaker 1: say his name properly, but maybe I shouldn't say his name.
Speaker 1: I don't want to. I'm not criticizing the club itself,
Speaker 1: but it's a private club. You can find it yourself.
Speaker 1: It's a private club that closed down recently in Atlanta
Speaker 1: because well, they didn't have any more customers, and they
Speaker 1: closed down in part because they not In part they
Speaker 1: shifted their business model from a y'all come business model
Speaker 1: to a membership business model private club rates, so they
Speaker 1: twenty five it's beautiful club by the way, rooftop club, pool,
Speaker 1: private bar, restaurant area, from what I can tell, gorgeous
Speaker 1: and was doing well. It's best I can tell, but
Speaker 1: made a critical mistake at a really bad time. They
Speaker 1: shifted from a general marketplace club where anybody can come in,
Speaker 1: pay a fee and then part take in the festivities
Speaker 1: to a private club of twenty five hundred dollars a
Speaker 1: year and twenty five hundred dollars initiation fee in the
Speaker 1: middle of a down economy. It's not a bad economy,
Speaker 1: it's not a recession, but people are delaying extravagant purchases.
Speaker 1: People are watching their dollars. Interest rates have been going
Speaker 1: up for hello almost two years now, what part of
Speaker 1: this do you not understand? When interest expense goes up,
Speaker 1: that people's cash flow tightens up and they start spending
Speaker 1: less on floss and fluff and start spending more on
Speaker 1: the basics. And so the mistake number one was mistiming
Speaker 1: the market. If he had he or she had done
Speaker 1: this two or three years ago, maybe they could have
Speaker 1: gotten away with it, but and locked in a customer
Speaker 1: base that are willing to pay twenty five hundred dollars
Speaker 1: a year of the membership feed. But I even think
Speaker 1: that in this example I'm about to give you probably
Speaker 1: wouldn't have worked either. They missed time the market, they
Speaker 1: miss judge their marketplace. Somebody said in the comments in
Speaker 1: this example that they didn't listen to their customer. No,
Speaker 1: they didn't pay attention to the marketplace. The customers might
Speaker 1: have said, from an ego perspective, I would love to
Speaker 1: have a private club. But the next question is are
Speaker 1: you willing to pay for it? And can you give
Speaker 1: me a credit card in advance to pay for two
Speaker 1: years of membership the initiation fee plus their first year,
Speaker 1: and then give me a forward approval to renew you
Speaker 1: for another year. Because my business model mustn't last for
Speaker 1: at least two years to sustain itself, and I think
Speaker 1: that they would have found that the majority of their
Speaker 1: customers would not have signed up for that. So based
Speaker 1: on I guess just a vibe of asking people like
Speaker 1: people say, do you want to solve poverty? Yes? But
Speaker 1: are you willing to write a check to solve it?
Speaker 1: You know? Do you want to help your cousin, you
Speaker 1: know Jojo, Yes? Sure, are you willing to finance his
Speaker 1: whole lifestyle? So in this example, they misjudged the marketplace
Speaker 1: because people are hurting, which is why credit card and
Speaker 1: then living off credit cards in order to extend their lifestyle.
Speaker 1: Because the pandemic hit, all that stimulus money flew into
Speaker 1: the economy. Literally, the US economy has never used trillions
Speaker 1: of dollars. So let me prophrase that no government has
Speaker 1: ever used trillions of dollars zero. No government history of America,
Speaker 1: history of the world, has ever had a stimulus package
Speaker 1: with tridiands next to it trede ins, T one tree.
Speaker 1: They have long two, three, four, five, six, seven, eight
Speaker 1: trillion dollars probably more than that. To say, the biggest
Speaker 1: economy in the planet, our economy from implosion which happened
Speaker 1: in two thousand and twenty twenty two. It's almost like
Speaker 1: people forgot that that we had the worst pandemic since
Speaker 1: the Spanish fluid, and it shut down the economy. It
Speaker 1: could have been as the Great Depression had been managed well.
Speaker 1: We got through that. But all that that money going
Speaker 1: into the marketplace went to individuals, which is I think,
Speaker 1: you know, it has to go someplace, should go to
Speaker 1: the folks that are driving the economy. And seventy percent
Speaker 1: of the economy is driven by you and me consumers
Speaker 1: buying car you know, buying cars, by buying lunch, buying dinner,
Speaker 1: buying vacations, you know, by getting on nails done, all
Speaker 1: that kind of stuff. It's just the majority of economist
Speaker 1: consumer spending. So I thought that was very smart that
Speaker 1: that happened in that way, and I helped to design
Speaker 1: parts of the PPP program that helped small businesses at
Speaker 1: that time. But that was a one time event. That
Speaker 1: money came in, you got it, you spent it right,
Speaker 1: and people start using spending money on things that they
Speaker 1: would not normally spend money on, and quitting their jobs
Speaker 1: and going on fancy vacations and thinking they're rich. No,
Speaker 1: you're not rich. You just had, you know, a gift
Speaker 1: from heaven. Right, that was a one time situation, and
Speaker 1: I hope you use that money to reset your life.
Speaker 1: But that money's washed out the system. It's gone, is done,
Speaker 1: and now you're trying maybe some of us, many of us,
Speaker 1: are trying to extend that lifestyle situation with increasing interest rates,
Speaker 1: increasing prices because of the economy is trying to adjust
Speaker 1: from free money of zero percent plus all the money
Speaker 1: flowing from the government to the into the commomy from
Speaker 1: the pandemic which caused enormous inflation. And we're trying, you know,
Speaker 1: sort of increasing interest rates, increasing costs of daily living.
Speaker 1: And if you're trying to continue your lifestyle, I guess what,
Speaker 1: you have to use credit cards, which is not hello,
Speaker 1: real money. You got to pay it back. So this
Speaker 1: is the lesson I'm getting to. People in the comment
Speaker 1: said they should had a SOHO. There was one comment
Speaker 1: that was brilliant in one comment that I was actually
Speaker 1: could have been brilliant but actually missed the mark. Comment
Speaker 1: that was brilliant was they should have had a blended
Speaker 1: model where they had a membership option, private membership option,
Speaker 1: and that private group could come once a week or
Speaker 1: once a month, or every Tuesday or every whatever it is.
Speaker 1: And here's their area, the private area you get to
Speaker 1: chill at as a private member, And that might have worked.
Speaker 1: You could have tested the model in that way to
Speaker 1: make sure that it did work, versus just betting the
Speaker 1: whole farm on going to this private model. And I think,
Speaker 1: I don't know it was for greed, but you know
Speaker 1: there's potentially a lot of money coming in at one
Speaker 1: time and doing more with less, making more by doing
Speaker 1: less work. I just think again, One, the market timing
Speaker 1: was wrong. Two, the marketplace was wrong. Three the customer
Speaker 1: base was wrong. What do I say that? Am I
Speaker 1: saying that black and brown people in Atlanta don't have
Speaker 1: the money? No, that's not, mister Mark completely the Soho model,
Speaker 1: the Soho House model. I'm a member of Soho House.
Speaker 1: My wife wanted to be a member and I joined
Speaker 1: with her. And I was recommended to the Soho House
Speaker 1: by Tony Wrestler, who is the two hundred and eightieth
Speaker 1: whichest man in the world or something like that, A
Speaker 1: dear friend of mine in a business partner. So did
Speaker 1: you hear what I just said? It's a membership model.
Speaker 1: I was recommended by a billionaire who's a member whose
Speaker 1: company pays his membership. Get that all right? All right?
Speaker 1: I have a business case for it. I pay shakespasts
Speaker 1: membership personally, but my membership is business based. I only
Speaker 1: go there when I'm having a meeting or having a
Speaker 1: business dinner, or need a quiet place to work when
Speaker 1: I'm traveling to cities and someplace I need to go
Speaker 1: and quiet myself. Right And by the way, the closing
Speaker 1: of this place in Atlanta might benefit And again I'm
Speaker 1: not saying the name because I don't want to cause
Speaker 1: any negative shade on them in case they decide to
Speaker 1: reopen or renew themselves. And I understand it there and
Speaker 1: talks with friends of mine. But Ryan Wilson of the
Speaker 1: Gathering Spot actually might benefit from this because he does
Speaker 1: have a private business membership club in Atlanta all the
Speaker 1: Gathering Spot that has done reasonably, if not very well.
Speaker 1: He's got several locations now. It is reasonably priced. I'm
Speaker 1: a member there, and I know my team uses it
Speaker 1: to hold events, and politicians go there, and hip hop
Speaker 1: stars go there, and business people go there and hold
Speaker 1: events for a business purpose. So that actually might work
Speaker 1: in the consolidation in Atlanta of private business clubs for
Speaker 1: people of color. Actually is probably a good thing. But
Speaker 1: back to the story. The reason this doesn't work is
Speaker 1: that black people are using private personal money now mostly
Speaker 1: on credit cards, to finance a social lifestyle, to meet somebody,
Speaker 1: to look good for somebody, trying to impress people you
Speaker 1: don't know, money you don't have about to talk about
Speaker 1: things that don't matter. And the place is optional in
Speaker 1: your life. It's not necessary for you to live. It's
Speaker 1: an ad it's a bonus. When things get tight in
Speaker 1: your life, Guess what goes first? Hello? This does? And
Speaker 1: if your credit cards get tight, guess what goes first?
Speaker 1: Which expense goes first? Hello? This does. So people who
Speaker 1: are or who are not financially literate, who doesn't understand
Speaker 1: how wealth works, uses cash, uses money their own money
Speaker 1: to finance and floss to finance their floss. Right, business
Speaker 1: leaders who have hopes again example, SOHO house memberships are
Speaker 1: using This is a business expense, a proper legitimate business expense. Again,
Speaker 1: you might pay for your spouse as I pay for
Speaker 1: mine personally, but the core spence is a business expense,
Speaker 1: and we use it for business purposes, and we write
Speaker 1: it off so it's not on our personal balance sheet.
Speaker 1: I hope this is really becoming clear to you. So
Speaker 1: I'm about to give another example tied to this. But
Speaker 1: these private social clubs, once you meet a mate, meet
Speaker 1: the girl you're looking for, the guy you're looking for,
Speaker 1: are you still going to the club? Not as often?
Speaker 1: If you're going with area, it's probably more date night.
Speaker 1: But you're not going there every night like you used to.
Speaker 1: And you're not going to use your limited credit card
Speaker 1: money or your free cash flow to keep doing that
Speaker 1: when you don't have to. It's again an option. It's
Speaker 1: not businesses social and social is not sustainable. And also
Speaker 1: people are flaky. They've got short tension spans. They're like, oh,
Speaker 1: it was cool today, not cool tomorrow. Oh I don't
Speaker 1: like those people anymore. I'm not going there anymore. You've
Speaker 1: detied your whole business plan on somebody who's flaky. Number
Speaker 1: two jets people who don't have money, who just who
Speaker 1: just fall in the money rolling the money. Think about
Speaker 1: the latest rap star or whatever image comes to your head,
Speaker 1: who's not been taught financial literacy goes and rents a
Speaker 1: private jet. They just pay for it or worse by
Speaker 1: private jet. But they rent or least charter a private
Speaker 1: jet out of their own cash realty, just pay for
Speaker 1: it like here, here's the money. It's just just burning
Speaker 1: the money up. Or they rent two or three like
Speaker 1: I heard this. One professional athlete did. A boxer did
Speaker 1: for one for him and his family, one for his
Speaker 1: crew number one, one for crew number two. Crazy stuff.
Speaker 1: He's gonna be broken just a matter of time, because
Speaker 1: my billionaire friends don't do that. Who rents their jets
Speaker 1: their companies. It's a business expense and they can't write
Speaker 1: it off. They're not doing it. If you see somebody
Speaker 1: renting a mansion or a beach house someplace for two
Speaker 1: or three months, then I pay for that personally, that's
Speaker 1: a business expense. You've got that situated? Is there is?
Speaker 1: There is their remote offices, there, retreat offices, their you know,
Speaker 1: satellite office location. So and these are all legitimate as
Speaker 1: long as the legitimate activities are happening there, all right. So, uh,
Speaker 1: one is sustainable. One is not all right? So the
Speaker 1: flaws has to have a purpose to it. I mean
Speaker 1: it doesn't my I mean again, the purpose is you
Speaker 1: can either you can afford it and you to think
Speaker 1: about it, or that floss is somehow making you money.
Speaker 1: If you're an entertainer and your flossing that may support
Speaker 1: your brand. You may you may be you may need
Speaker 1: to hang out in clubs because that's where people are
Speaker 1: playing your music. Right, But if you hang out in
Speaker 1: the club, I suggest you own it. And if you're
Speaker 1: gonna own it, uh, you know, make sure your your
Speaker 1: inflow exees your outflowed flow. Otherwise you're overhead. It will
Speaker 1: be your downfall, which means you need to make sure
Speaker 1: you've got a proper business model. Back to credit scores,
Speaker 1: all right, So, in addition to the fact that folks
Speaker 1: who live in a seven hundred credit score neighborhood live longer,
Speaker 1: twenty years longer, one thing I've said is if your
Speaker 1: day's not about God or love, your days about money.
Speaker 1: Let's now get specific on that you live in a
Speaker 1: five hundred credit score neighborhood. I grew up in one.
Speaker 1: Whether you're black and brown urban or your white, poor rural.
Speaker 1: Here's what you see. You see a check casher next
Speaker 1: to a payday alone lender, next to a rent to
Speaker 1: owned store, next to a title linender, as in a
Speaker 1: car title lender. Next to a liquor store. I've already
Speaker 1: said that. Next to a pawn shop, and I'm getting
Speaker 1: an a man yet, are you nodding your head up
Speaker 1: and down yet in an agreement? Next to what I
Speaker 1: said a liquor store, pawn shop? I'm sure I miss
Speaker 1: something added in to the comments wherever you are responding
Speaker 1: on social added into your comments so the other others
Speaker 1: can be educated. Next to a church, whether you're black
Speaker 1: and a brown, urban or white rule, it's a church
Speaker 1: out down the street trying to make you feel a
Speaker 1: little less stressed out once a week so you don't
Speaker 1: go postal on somebody on Monday. It's this is your
Speaker 1: neighborhood psychologist. And I often would joke, if you don't
Speaker 1: think you need a psychologist, you probably need a psychologist
Speaker 1: if you if you black and brown in America, certainly,
Speaker 1: I say, if you're black in America and you don't
Speaker 1: think you're crazy, you're probably crazy. So if you're not
Speaker 1: seeing a psychologist or or somebody, or or your church
Speaker 1: minister is talking to somebody, it's all the psychologists is
Speaker 1: a paid friend. If you don't have to be talking
Speaker 1: to somebody, about your stress. You're not going to church,
Speaker 1: then you're going to find some other way to relieve
Speaker 1: your pressure, maybe going to the club. I just talked
Speaker 1: about that. That you're you're using your credit cards, then
Speaker 1: your credit card is going to stress you out. Then
Speaker 1: you're going to have a problem at some point. So
Speaker 1: these neighborhoods are managing problems, their problem management, and that
Speaker 1: it's not even management, it's problem abatement. It's problem deferral. Right,
Speaker 1: it's it's it's it's a surviving mindset in these neighborhoods.
Speaker 1: That's what I did. I covered this in my book
Speaker 1: The Memo I think I did that. That was my
Speaker 1: fourth book, How the Poor and Save Capitalism, the memo
Speaker 1: up from Nothing, not the mindset and up from Nothing
Speaker 1: and that My last book is Financial Literacy for All,
Speaker 1: which I want you all to get and to donate
Speaker 1: to a local library or title I school in your
Speaker 1: neighborhood and you're near where you live, so you can
Speaker 1: teach financial literacy and show up as a role model,
Speaker 1: which I also cover in the time piece, to mentor
Speaker 1: other people so they can be like you, watch you
Speaker 1: living your life. Maybe the only Bible anybody else reads.
Speaker 1: So this is what happens in a five under credit
Speaker 1: corre neighborhood. They're target marketing you, not because you're black,
Speaker 1: not because you're brown, not because you're a woman, not
Speaker 1: because you're poor, white, but because you're financially illiterate. Because
Speaker 1: they can't, because this is behavioral economics, and this is
Speaker 1: bad capitalism. Because I covered earlier and in that same
Speaker 1: neighborhood you lived in sixty years of age, you typically
Speaker 1: go to high school sixty five sixty sixty sixty five
Speaker 1: percent of people graduate from high school in that same neighborhood.
Speaker 1: In a seven hundred credit score neighborhood, ninety ninety five,
Speaker 1: ninety six percent of people go to finish high school,
Speaker 1: which means at that rate of high school equivalent of completion,
Speaker 1: that means they're going to college. So essentially, the vast
Speaker 1: overwhelming majority of people in a seven hundred credit cord
Speaker 1: neighborhood are going to college. And that means that their
Speaker 1: aspiration is informed by the latest technology, the latest offerings,
Speaker 1: which means artificial intelligence may not put them out of
Speaker 1: a job. They might get they might understand how to
Speaker 1: do the new job of AI. They will understand finance
Speaker 1: will understand technology, you know understand market economy. So you know,
Speaker 1: more education is just more good. I mean, you cannot
Speaker 1: you need as much education. You can shut down your throat.
Speaker 1: If you live in a five hundred credit cord neighborhood,
Speaker 1: violent crime per thousand is off the chain. The majority
Speaker 1: of households are single family households, single parent households, so
Speaker 1: typically the mother. Did you know that seventy percent of
Speaker 1: black households, by the way, as an example, or run
Speaker 1: by women, women need a Nobel Peace Prize. I wrote
Speaker 1: a piece in Time magazine about the power of women,
Speaker 1: by the way, should read that piece, very thought provoking piece.
Speaker 1: But my mother, my mother, Wendya Smith, ran our household,
Speaker 1: single mother, divorced. So these these households have single parents.
Speaker 1: They have high levels of violent crime, high levels of
Speaker 1: substance abuse, drug abuse, high levels of police engagement versus
Speaker 1: police protection, low tax basis, which means low levels of homeownership.
Speaker 1: But I'm going to get into covering a couple of cities,
Speaker 1: specifically side by side. Comparisons couldn't get this in their
Speaker 1: Time article because it's you know, eight hundred one thousand words.
Speaker 1: But I going to cover now the literally the difference
Speaker 1: between a five hundred and a seven credit score neighborhood.
Speaker 1: And I want you to think about your neighborhood and
Speaker 1: where you grew up at. I want you to go
Speaker 1: to the Operation Hope Whole Financial Wellness Index. Type in year,
Speaker 1: zip code. You tell me your zip code. I'm gonna
Speaker 1: tell you how you live in again, show you how
Speaker 1: the color actually is green. I can't change how somebody
Speaker 1: feels about you. I can't change when somebody likes you
Speaker 1: or not, and whether they like black people or brown people,
Speaker 1: or whether they have racism in their heart. But what
Speaker 1: I can change help you change is your credit score.
Speaker 1: And I'm going to tell you before we finish how
Speaker 1: you best change your credit score, whether the steps you
Speaker 1: can take to empower yourself. And by the way, Number
Speaker 1: one calls divorce America money. Number one calls for the
Speaker 1: messic abuse in households. Money Number one reasons why police
Speaker 1: get hurt the mesic abuse calls. Number one calls for
Speaker 1: that money. Number one calls for heart attacks in America. Stress.
Speaker 1: Number one calls for stress money. So am I saying
Speaker 1: the seven hundred cditcored neighborhoods are perfect. No, I'm not.
Speaker 1: But you've never seen a riot in a seven hundred
Speaker 1: credit score neighborhood in all of American's history because seven
Speaker 1: hundred credit score neighbors don't riot, they go shopping. So so,
Speaker 1: nothing changes your life more than God or love than
Speaker 1: moving your credit score one hundred and twenty points. That's
Speaker 1: a mic drop right there. Nothing changes your life more
Speaker 1: than God or love than moving your credit score one
Speaker 1: hundred twenty points. You go to the club tonight, and
Speaker 1: maybe it's the club that gets reopened in Atlanta, or
Speaker 1: maybe it's right you know, Ryan Wilson's club, the gathering spot,
Speaker 1: the business club that opened for an evening soiree. You
Speaker 1: go to a club right and you say, man, she's fine, Bruther,
Speaker 1: It's like she's fine, sis, It's like, oh, he's so handsome.
Speaker 1: Asks a name. Get acquainted as soon as you think
Speaker 1: this is a quasi serious conversation before anybody's had too
Speaker 1: many drinks. But that overpriced liquor by the way, that
Speaker 1: costs a fraction of what you're paying for it, and
Speaker 1: that VIP club area that you would not stand in
Speaker 1: during the day because it's probably all kind of stuff
Speaker 1: running around that were scared but was out of you.
Speaker 1: But it's night and it's dark and there's a velvet
Speaker 1: rope on it and they've up charged you, and you
Speaker 1: think it's cool anyway. Okay, So when you go to
Speaker 1: that club tonight and after you, before you get drunk,
Speaker 1: I'm sorry, intoxicated, I want you to ask the other
Speaker 1: person what's your credit score? And I'm only partly partly kidding.
Speaker 1: Because part of marriage, Yes, romance is important, and spirituality
Speaker 1: and religion is the core of it. And make sure
Speaker 1: that it's endowed by God. The institutional marriage, but that
Speaker 1: I covered the breakfast club. Marriage came from business thousands
Speaker 1: of years before ever. God endowed it with special features
Speaker 1: and meetings. So that you know you are rooted in
Speaker 1: a spiritual purpose for your marriage. But at the end
Speaker 1: of the day, you will make sure you're not married
Speaker 1: marrying a dunce, marrying an idiot, marrying a bonehead, marrying
Speaker 1: somebody who can't raise your children, marry can't somebody who
Speaker 1: can't add two plus two. This is where I love
Speaker 1: and I say math. I like math. It doesn't have
Speaker 1: an opinion. That's a melody hops in quote. I've co
Speaker 1: opted it and The math of a marriage and a
Speaker 1: relationship is that it needs to be multiplication, not just addition.
Speaker 1: So two plus two is compounding. Two plus two has
Speaker 1: to equal more than four. One plus one has to
Speaker 1: equal more than two. In a relationship, it is at
Speaker 1: it means four, six, eight, or ten. Otherwise, why are
Speaker 1: you doing it? You're not better together? Why are you
Speaker 1: doing it? And it just so happens that financial stress
Speaker 1: causes the in a surviving mindset relationship, domestic abuse arguments
Speaker 1: people to do start to do all kind of crazy
Speaker 1: stuff to try to meet their needs, like stealing, theft,
Speaker 1: hurting your own neighborhood. That's where black on black I
Speaker 1: think crime comes from. You know, nobody wakes up the mornings,
Speaker 1: who let me be a bum, Let me be an idiot,
Speaker 1: let me be a you know a ways to my
Speaker 1: own community and society. And people know they trying to
Speaker 1: do they're trying to get by, and they look around
Speaker 1: their neighborhoods to figure out how they can get buy
Speaker 1: and unfortunately they end up praying on somebody who looks
Speaker 1: like them. That business model, that eating yourself business model,
Speaker 1: crabbing the barrel business model is not sustainable. It's not
Speaker 1: going to work, it's going to fail. I'm trying to
Speaker 1: give you a path forward to stability and centerer credit
Speaker 1: score neighborhoods represent that and it's something you can control.
Speaker 1: I can help you get your credit score right right,
Speaker 1: and that may help you get your life right. And
Speaker 1: we live in a society, a free enterprise, capitalist democracy
Speaker 1: society where from the time you go to bed at
Speaker 1: night to the time you wake up in the morning,
Speaker 1: you're actually having a financial transaction because you're putting your
Speaker 1: head on a pillow government didn't issue to you, using
Speaker 1: an alarm clock to wake you up that the government
Speaker 1: didn't issue to you. You bought it. You're paying for
Speaker 1: utilities and rent and air conditioning and heating that you
Speaker 1: pay for, and we geup in the morning at nine o'clock.
Speaker 1: From nine until you go to bed at you're once
Speaker 1: again dealing with capitalism and free enterprise. It's just a
Speaker 1: series of facial transactions all day that you're not paying
Speaker 1: attention to. And if you're paying the high rates for that,
Speaker 1: then you are living in an unsustainable situation. You're paying
Speaker 1: then those who make the least pay the most. Let
Speaker 1: me get now into details. You live in Chicago. All right,
Speaker 1: and I did a video on this. You used to
Speaker 1: look it up. Check it out on my social media
Speaker 1: page at John O'Brien or at Operation Hope. You'll find
Speaker 1: it in both places. So if if anybody listening to
Speaker 1: this from Chicago, you know where West Garfield Park is,
Speaker 1: that's six oh six two four zip code. You're living
Speaker 1: in Lincoln Park, or you know Lincoln Park, that's fifteen
Speaker 1: minutes away by car from Garfield Park. I know, we
Speaker 1: got drove it. That's six six one four zip code. Okay,
Speaker 1: now you can go again. You go to the Whole
Speaker 1: Financial Wellness Index and put your ZIP code in. It'll
Speaker 1: tell you which your credit score is in that neighborhood.
Speaker 1: By the way, lowest credit score state in America Mississippi. Again,
Speaker 1: I cover this in the Time piece. Highest credit score
Speaker 1: state in America Minnesota, and so Minnesota has a seven
Speaker 1: hundred and fifty or seven sixty average credit score. In
Speaker 1: Mississippi has a six hundred and sixty six average credit score.
Speaker 1: Now you may say six six sixty six average credit
Speaker 1: score is not so bad. No, I said average and
Speaker 1: or median, which means that you had people above that
Speaker 1: credit score. So you have people who are wealthy at
Speaker 1: seven hundred, seven fifty eight hundred. You have people who
Speaker 1: are poor at six hundred, five fifty five hundred, four hundred.
Speaker 1: And what that says in Mississippi is you had many, many, many,
Speaker 1: many many more people who are poor pulling that number
Speaker 1: down than you had other people pulling that number up.
Speaker 1: And men a place like Minnesota at more people who
Speaker 1: are wealthy or doing well or at least aspirational and
Speaker 1: succeeding pulling that number up, so the average is higher. Right,
Speaker 1: I have a credit score with eight hundred in change,
Speaker 1: My mother is eight fifty four. If you can believe that,
Speaker 1: if on my block or in my neighborhood, if I'm
Speaker 1: the only eight hundred credit score and then everybody else is,
Speaker 1: you know, six hundred and five hundred credit score, even
Speaker 1: though I'm an eight hundred credit score, the average in
Speaker 1: my neighborhood's going to be more like six ninety or
Speaker 1: something like that, because my high average is going to
Speaker 1: be pulled down by everybody else's low averages. That makes
Speaker 1: me sense. And so why is this important? Okay? Because
Speaker 1: culture is everything. Your neighborhood has a culture, your household
Speaker 1: has a culture, your block that you live on has
Speaker 1: a culture. America has a culture, and your cities have
Speaker 1: a culture. That's why New York City is different from Buffalo,
Speaker 1: New York. That's why Los Angels is very different from
Speaker 1: San Francisco. It's why Atlanta is different from Columbus, Georgia.
Speaker 1: That's why you move from one place to another and
Speaker 1: travel one place the other. That's why New Orleans in
Speaker 1: Louisiana is different from Shreveport in Louisiana. These these places
Speaker 1: have cultures, they have personalities, right, and what is a
Speaker 1: personality in your household? What is a personality in your
Speaker 1: in your in your social circle? Do you hang around
Speaker 1: nine broke people, You'll be the tenth. You've heard me
Speaker 1: say this over and over again and trying to put
Speaker 1: these pieces together for you, so it starts to make sense.
Speaker 1: Watch who you hang around. Because we model what we see.
Speaker 1: Why do kids in underserved neighborhoods want to be rap stars,
Speaker 1: athletes and drug dealers. They're not dumb and they're that stupid.
Speaker 1: They're brilliant, but they're modeling what they see. We got
Speaker 1: to give them something different to see, you know. And
Speaker 1: I talk about urban communities and poverty. By the way,
Speaker 1: you know, what do you think NASCAR came from? Came
Speaker 1: from moonshine running from poor whites in the Appalachian Mountains
Speaker 1: who are running from the police. Did you know that?
Speaker 1: And they realize at some point that business model is
Speaker 1: not going to work, so they say, well, look what
Speaker 1: part of this is sustainable? Because I'm gonna get shot
Speaker 1: and killed or you know, murdered or in prisoned just
Speaker 1: doing the rate, the running them the police in the
Speaker 1: moonshine thing. So I'm a good driver. So the driving
Speaker 1: went from driving on the on the streets and running
Speaker 1: from the police and then running behind the competitors on
Speaker 1: a circle on the dirt, and that turned into the
Speaker 1: stadium driving. You see the day in Nascar, and these families,
Speaker 1: many of these families in NASCAR are the descendants of
Speaker 1: moonshine runners. Did you know that? All? Right? Rainbows after storms?
Speaker 1: Back to the story, Chicago, Take out your pen and
Speaker 1: paper or your you know, your iPad or your iPhone
Speaker 1: or whatever you use you write on it is digital world.
Speaker 1: Garfield six h six twenty four, average credit score five
Speaker 1: ninety seven. Actually not that bad. You'll see what I
Speaker 1: mean by that. In a minute. Lincoln Park credit score
Speaker 1: is seven thirty nine. Meeting household income Garfield Park twenty
Speaker 1: five thousand and six forty eight dollars Lincoln Park fifteen
Speaker 1: minutes apart one hundred and seventeen thousand dollars average income
Speaker 1: unemployment rate eleven point eight percent versus two point three
Speaker 1: percent home ownership rate. Check this out now. The easiest plat,
Speaker 1: the easiest way to build wealth in America is home ownership.
Speaker 1: You've heard me said a million times. The biggest business
Speaker 1: in the world is real estate. And every millionaire, including
Speaker 1: the one talking to you now, is steeped in home
Speaker 1: in in real estate and typically owns their own home,
Speaker 1: but they're certainly their portfolio includes real estate. Twenty seven percent.
Speaker 1: Home ownership rate in Garfield Park eight six h sixty
Speaker 1: two four. What's the meeting house with income for Black
Speaker 1: people in America? Forty one forty two forty three forty
Speaker 1: four percent. What's meeting house or income for white America
Speaker 1: about seventy five percent. That thirty percent thirty five percent
Speaker 1: delta difference between black home ownership rate and white home
Speaker 1: ownership rate is the huge, the gaping gap of wealth
Speaker 1: creation of wealth. The wealth and wealth in quality in
Speaker 1: this country, and they are historic reasons for to go
Speaker 1: all the way back to slavery and Jim Crow era
Speaker 1: and the UH the forty eggs and mule and and
Speaker 1: all that stuff, which I covered in my book Financial
Speaker 1: Newsy for All in great detail. And also the huge
Speaker 1: squash of land ten percent of all American land that
Speaker 1: was given to settlers who went west after the Civil War,
Speaker 1: ninety nine point nine percent didn't look like me, which
Speaker 1: which is one hundred million Americans today who benefited from that.
Speaker 1: So wealth creation and poverty UH alleviation or the lack thereof,
Speaker 1: are pretty obvious of why we end up where we
Speaker 1: end up and and correcting it. All I'm doing with
Speaker 1: what I'm doing now is using math and formulas's and
Speaker 1: using the same system that enslaved us and that it
Speaker 1: burdened us to set us free and to give us opportunity. Hello,
Speaker 1: that's a rap MI paying attention to my brother t II,
Speaker 1: paying attention to give you some some rap content from
Speaker 1: next your next album's Brothers, They'll be in our hopeful
Speaker 1: perform By the way, for home ownership rate for Garfield
Speaker 1: Park compared to forty five percent in Lincoln Park, which
Speaker 1: is actually a very low number, but there's a lot
Speaker 1: of apartment living in condos. Lincoln Park is basically downtown
Speaker 1: in Chicago, so it's kind of living in downtown. And
Speaker 1: that was a suburban area, it would be seventy five
Speaker 1: eighty percent home ownership rate, but the Garfield Park is
Speaker 1: definitely residential neighborhood, so it's twenty seven percent is extremely low.
Speaker 1: Meeting home value one hundred and eighty thousand, eighty thousand
Speaker 1: versus almost seven hundred thousand in that same neighborhood. Violent
Speaker 1: crimes per thousand, get this, seventy five point zero compared
Speaker 1: to five point one four. One's safe and one is
Speaker 1: incredibly not safe. High school graduation rates sixty three point
Speaker 1: eighty percent in six oh sixty two four Garfield Park
Speaker 1: compared to ninety two percent in Lincoln Park. Basically going
Speaker 1: to college, and like expectancy rate, again, this is not
Speaker 1: as bad as I've seen. If you get below the
Speaker 1: five hundred credit score, it's worse than this, but sixty
Speaker 1: nine years of age on average, so you get sob
Speaker 1: security with sixty five, so you're just getting so security
Speaker 1: and you drop dead. You get two three years of chilling.
Speaker 1: Then you're dead. The average for a five hundredreditcore neighborhood
Speaker 1: is sixty one years. You don't even make it to
Speaker 1: solid security. What did Malcolm Xay, we've been bamboozoo, we've
Speaker 1: been tricked, we've been fooled. Hello. And then Lincoln Park,
Speaker 1: of course, eighty one years of age, which is the
Speaker 1: average forty seven hundred credit corred neighborhood. You can't make
Speaker 1: this stuff up right. This is not like John Bryant's
Speaker 1: theory on relativity, relativity and success and failure. This again,
Speaker 1: I like math because it doesn't happen. Opinion. Let's look
Speaker 1: at Atlanta city that I've called home. I grew up
Speaker 1: in La but I now call Atlanta home. Forest Park
Speaker 1: as an example, three oh two nine seven zip code
Speaker 1: sixty nineteen credit score not bad at all actually, But
Speaker 1: Virginia Highlands three three six seven forty credit score once
Speaker 1: again in how a meeting household income thirty thousand versus
Speaker 1: one hundred and three thousand, unemployment rate nine percent versus
Speaker 1: three percent. Home ownership rate not so bad, forty three
Speaker 1: percent versus fifty eight percent. But as you see, as
Speaker 1: the credit score goes up in the underserved neighborhoods, the
Speaker 1: worst things get less bad and get as you or
Speaker 1: as I'd say, my grow up neighbor, I grew up
Speaker 1: mo Beta forty three percent is not good, but it's
Speaker 1: actually the national average for black folks by the way,
Speaker 1: as I've already mentioned. But it's not horrible, it's not.
Speaker 1: This is actually what I see normally in these five
Speaker 1: hundre creditscred neighborhoods is a home owners rate in the twos,
Speaker 1: twenty five, twenty seven. That's why I'm saying forty three
Speaker 1: percent is not bad, but it's not aspirational either. You
Speaker 1: want to seventy five percent of ownership seventy five percent
Speaker 1: home ownership rate meeting home value fifty five thousand versus
Speaker 1: four hundred and eighty six thousand dollars. This is fifteen
Speaker 1: minutes apart. Violent crimes per thousand, seven point four versus
Speaker 1: two point eight. Not as bad as but I just
Speaker 1: missed Chicago. But again, the credit score is in the
Speaker 1: sixes in the Forest Park versus the five hundreds in
Speaker 1: Garfield Park. High school graduation rate sixty percent versus ninety
Speaker 1: seven percent life expectancy rate. Get this seventy four years
Speaker 1: versus eighty two years. So again the seven credit score
Speaker 1: neighborhood is about the same, eighty one to eighty two years.
Speaker 1: And again the low wealth neighborhood. As that credit score
Speaker 1: goes up, that life expectancy creeps up. It's still seventy
Speaker 1: four years, is not eighty two years. You're still living
Speaker 1: just under a decade less on average of lifespan. So
Speaker 1: now let's go to Let's go to Memphis, Tennessee. I
Speaker 1: was just there on the American Aspiration Tour for my
Speaker 1: new book, Financial Literacy for All, my Business Plan for America,
Speaker 1: and Operation Schulps Work. Average credit score in Memphis New
Speaker 1: Pathways area zip code three eight one two six. By
Speaker 1: the way, send me your zip code if you want
Speaker 1: me to do the work for you. Map this out.
Speaker 1: Map out the tail of two cities in your area.
Speaker 1: You want to be on the American Aspiration Tour, Go
Speaker 1: to the American Aspiration Tour page and submit a request.
Speaker 1: We'll see if we can get a hold of your
Speaker 1: mayor and get them new advite me to come through.
Speaker 1: Mayor Andre Dickens kicked it off with me in Atlanta.
Speaker 1: Then I went to Mayor Paul Young in Memphis and
Speaker 1: coming to Mayor Steven Reid next, amongst others. So I
Speaker 1: would love to come to your city. Here's Memphis again,
Speaker 1: five eighty four credit score in Memphis three eight one
Speaker 1: two six zip code Tyree Nichols killing a zip code
Speaker 1: where Tyre's Nichols was killed. It's three eight one four
Speaker 1: three eight one four one zip code. That's six one
Speaker 1: hundred and thirty two six point thirty two credit score
Speaker 1: in Germantown in Memphis zip code three eight one three nine,
Speaker 1: seven hundred and forty five credit score. And by the way,
Speaker 1: I don't even need to see these credit scores tell
Speaker 1: you how about these neighborhoods. Seven forty five is completely stabilized.
Speaker 1: That's a middle class, upper middle class neighborhood. I don't
Speaker 1: even just see it. Somebody watching a list in this
Speaker 1: can just confirm yep, he's right. And I can tell
Speaker 1: you where five eighty four credit score is. That's toe
Speaker 1: up from the flow up. And the median household income
Speaker 1: is thirteen thousand dollars in five eighty four credit score.
Speaker 1: Neighborhood unemployment rate is ten percent, which is low actually
Speaker 1: for that kind of neighborhood home ownership rate is thirteen percent. Oh,
Speaker 1: it just broke my heart. Thirteen percent, jeez, Louise meeting
Speaker 1: home value fifty thousand dollars on average, violent crimes per thousand,
Speaker 1: wait for this, thirty eight point zero compared to one
Speaker 1: point one. And then high school graduation rates seventy three
Speaker 1: percent actually not that bad compared to ninety six percent
Speaker 1: in that wealthy neighborhood. I mentioned to you life expectancye
Speaker 1: sixty eight years in the three eight one two six
Speaker 1: credit zip code, where there's a five eighty four credit
Speaker 1: score in a eighty one years of age in the
Speaker 1: seven forty five credit score. So I think you're starting
Speaker 1: to get it. Like I can do this all day,
Speaker 1: but I think it's important. I want you to understand
Speaker 1: that math works, that there's a formula to success. Success
Speaker 1: is intentional and so is failure. And I want you
Speaker 1: to create a formula for your success. Do the math,
Speaker 1: Understand the formula. Understand financial literacy. Understand how capitalism free
Speaker 1: enterprise works. Get my book Financial Literacy for All. Listen
Speaker 1: to this podcast every week. It's a literary library for
Speaker 1: success for your life. You listen to the whole year.
Speaker 1: Subscribe to your friends to subscribe, follow us on social media.
Speaker 1: Get your life coach through Operation help you financial Coach.
Speaker 1: We are America's financial coach at Operation Hope. Because of scholarships,
Speaker 1: it's free to you. This is the silver rights movement,
Speaker 1: from civil rights to civil rights, from the streets to
Speaker 1: the c suites, rebuilding the ladder of aspiration opportunity in
Speaker 1: America and soon around the world too. John O'Brien and
Speaker 1: I believe financial literacy is a civil rights issue of
Speaker 1: this generation. Let me know what you think. Read this
Speaker 1: Time magazine articles, share it, Let's discuss to quote my
Speaker 1: friend Charlemagne, Piece and Light. Money and Wealth with John
Speaker 1: O'Brien is a production of the Black Effect Podcast Network.
Speaker 1: For more podcasts from the Black Effect Podcast Network, visit
Speaker 1: the iHeartRadio app, Apple Podcasts, or wherever you listen to
Speaker 1: your favorite shows.