Introduction: Welcome to creating wealth with Jason Hartman, during this program, Jason is going to tell you some really exciting things that you probably haven’t thought of before and a new slant on investing. Fresh new approaches to America’s best investment that will enable you to create more wealth and happiness than you ever thought possible.

Jason is a genuine self-made multimillionaire who not only talks the talk, but walks the walk. He has been a successful investor for 20 years and currently owns properties in 11 States and 17 cities. This program will help you follow in Jason’s footsteps on the road to financial freedom. You really can do it and now here is your host Jason Hartman with the complete solutions for real-estate investors.

Jason: Welcome to the Creating Wealth Show, this is Episode #240 and this is your host Jason Hartman. Thanks so much for joining me here today. As always, every 10th show, we do a non-financial topic but it always relates back to finance and success in life in some way. And today, will be no exception as we talk to Dr. Gay Hendricks, who is the corporate mystic. He has 35 years of experience in this field and has written many bestsellers actually – Conscious Living and Five Wishes, The Corporate Mystic, The Big Leap, et cetera. So I think you’ll find this interview to be really interesting today and, again, we will get back on the pure financial topics in the next show, #241 and we’ll do that for 10 more shows until we get to #250, where we will do another topic of personal interest and general success interest.

But before we get to the interview today with Dr. Gay Hendricks, I wanted to talk to you about a few things. Number one, I tell you, I just cannot believe how clueless some people are, can you? Can you believe it? I hope I’m not beating a dead horse here when I keep talking about gold and silver; and institutional investors and just the craziness that goes on and on in financial world that makes no sense whatsoever. Wall Street, I’ll get back to bashing Wall Street later. But this time, just a couple more things to tie up what we’ve been talking about in the past few shows.

Really, I guess the past 239 shows, when we talk about gold and silver and here’s an interesting one. I got an email from actually a guy who I frequently look at his Facebook posts and so forth are kind of interesting and he sends me emails about, “Oh, this conspiracy and that government debacle and that one and that one.” And you know, I don’t necessarily disagree with those. A lot of times, frankly, he’s right. They are true, in my opinion and, we should be watchful of that.

But to this particular email, a couple of few weeks ago, I replied and I said, “Hey, Todd, what about gold and silver prices? So far, what we’re seeing is a silver bear market.” And the reason I sent this email is because a year ago, when silver went from about $34 or $35 to about $50 in just, I don’t know, very short time, a couple of weeks. I don’t know if you remember that. Everybody, all the gold bugs were out pushing it and talking about how it’s the greatest thing in the world, blah-blah-blah. And, you know, listen, you know what I think about this. I don’t disagree. I think metals are OK. I don’t think they’re great. I think they’re a defensive strategy. They’re better than fiat money. But I’m going to talk about that in a moment as it relates to metals here.

But I just wanted to share this very short email thread with you. I said that because Todd was the one that was such a gold-and-silver bug and so here’s his response. And I just want you to see if you can read between the lines here. So I said, “What do you think about silver and gold prices? So far, all we’re getting is a silver bear market.” I guess it’s not really a bear market but if you look at it from being down from almost $50, yes, it’s a bear market, sure it is. He replies, “Both gold and silver are undervalued big time. Here is why. Fiat currency.” I know it’s fiat currency, I know that’s what we have. Fiat by authority, by decree, that’s virtually every currency on earth now is a fiat currency in my commentary. He says, “Here’s why fiat currency. Silver market futures manipulated by JPMorgan and such, JP had big futures out on silver and they did not have the physical silver for the payout. Thus, silver is kept low to give JP time to get out of the future put options. That’s just silver. Both should be double of their current value.”

My response, “The question is when will JPMorgan (and others) stop manipulating the market? Maybe they’ll just manipulate it forever and limit our opportunity, right?” He never responds. I go on my sent file, I resend the same email several days later and I say, “Resending” at the top, still no response. I wait several more days and I find that email again and I go, “Resent” at the top, still no response. I do that a third time, resending again, still no response. Doesn’t this just blow your mind, folks, how these people have such a limited view of things that, yes, their premise is absolutely correct. I agree with everything they say, fiat money uncertainty, blah-blah-blah, which, by the way, brings me to another little point here.

I was talking with some of our wonderful clients who are here in Phoenix a few weeks back for our Creating Wealth Phoenix Edition and we all went out to dinner that night. We were talking about survivalism and some of this more apocalyptic, really dark kind of stuff like the end of the world and the Mayan Calendar, all those craziness. Everybody knows mostly that I host my number 2 show that I host out of 15 shows is entitled the ‘Holistic Survival Show.’ The tagline saying, ‘Protecting the people, places and profits you care about in uncertain times.’ I’ve got almost 80 episodes of the Holistic Survival Show up now. And I have to tell you that I consider myself to be prepared. I consider myself a person who is prepared for things that might happen in our world. I think you should be prepared too. That’s why I did the show. I’m not really selling investment, real-estate on that show. It’s kind of just for personal interest, really. I entertain a few of these more [unintelligible 06:48] people who we consider outlandish or non-mainstream conspiracy theories from time to time, I find them interesting. I think there are some truth in some of them for sure.

But, hardly enough, what I said as we were having dinner, to a couple of our clients there, I said, “Even though I produce that show, I have to tell you that after 70-some odd episodes, I don’t really believe those apocalyptic scenarios. I don’t believe they’re very likely. Are they possible? Sure, they’re possible. Are they likely? I don’t think so.” In many ways, things are improving right now, I got to be honest. It was interesting. I am off on another tangent. It was interesting because I was walking on the street today and there was retail location that’s been vacant for ever since last summer here in the Phoenix area. One of the real barometers of how the economy is doing, I think is how many vacant retail spaces and office spaces because those are so obvious, they’re so visible to us all in our daily lives.

It was interesting because there’s been a sign in the windows of this retail space since last summer, it’s been vacant. Today though was interesting. There were two separate people. They look like they were not together and they were both in front of that space looking at the sign on the window with the broker’s contact information or company logo, their phone number and they were calling the broker and as I eavesdropped as I walked by walking my dog, they seemed to both be leading this broker messages about this particular space, saying that they were interested in the space. Wow, what a change that was. Just very anecdotal but interesting, nonetheless.

You are starting to see some of this retail space get absorbed. Again, I don’t like commercial properties when it comes to retail-office. Don’t know much about investor, obviously. Well, not obviously, but I never pretended to know much about industrial properties. I’m not an expert there but I think retail and office are pretty lame, to say the least. I think that we want to be in housing of some sort, whether it be a large apartment buildings that are considered commercial properties or single family homes or duplexes and fourplexes, whatever. But housing is where it’s at. Just an anecdotal thing.

But do I believe these disaster scenarios are possible? The gold bug sure do. The silver bugs, the gold bugs, they definitely believe in these apocalyptic things. And, folks, do I think we will have major civil unrest for any length of time? No. I do not think so. Even though I interview a lot of these people on my ‘Holistic Survival Show’ and I’ve heard what they have to say and I’ve listened with an open mind. I’ve asked them I think good questions about it. Do I think we’ll have little pockets of the civil unrest? Absolutely and that’s what you better be prepared for. You need to be prepared to live with one gallon of water per person in your household per day, I suggest you do what I do for that. Just subscribe to Sparkletts or Arrowhead Water and have them deliver those 5-gallon bottles and save a whole bunch of extra ones and rotate them as you consume them and use them on your water cooler and some other things.

But all those gold and silver stuff, I mean, that is not the disaster plan, if you ask me. If the end of the world comes, who the heck is going to care about your silver and gold coins? They’re not going to care about that for a long time until an economy really regroups. You know what’s going to matter? Food, clothing, shelter, temperature regulation, guns and ammunition, if things really get ugly. That’s what you need to survive. Maybe even some Vodka and cigarettes, those will be highly tradable barter items probably, they all say that. Kind of funny.

But this whole gold and silver thing, I just honestly don’t get it because the question you’ll keep asking yourself is, “Did the gold and silver go up and did the dollar go down?” Every time I ask that question, like I shared on a couple shows ago with Bob, the guy I was talking to on Facebook about it, is dollar went down. Did you make any money? No, you did not. All you did is say even you treaded water, and, hey, that’s better than losing money. Don’t get me wrong, it’s definitely better than losing money.

But this whole thing about it being an investment is like saying that universal life or whole life insurance is an investment. It’s not an investment. It’s insurance, view it for what it is. Gold and silver, they can preserve wealth. They are a store of wealth. They are money. Okay, fine. Is money an investment? No. Money is not an investment. Money is just money. Don’t expect it to be more than money. Don’t expect life insurance to be an investment. It stinks as an investment. If you need life insurance, then buy yourself a cheap, term life policy to protect your loved ones and your family. Get insurance. [Unintelligible 11:52]. But these people that go around touting the stuff as an investment I think it’s disingenuous. I just don’t get it. I heard the arguments over and over and over. I just don’t understand them.

On this gold thing, the highly respected company in this gold field is a company called GoldMoney. Their tagline, “The best way to buy gold & silver.” I believe the founder of this company is a well-known, highly respected guy. I believe his name is James Turk, if I’m remembering that correctly. I want to get him on the show. I believe my guest booker actually sent him a guest request to be on the show. If not the ‘Creating Wealth Show’, at least, the ‘Holistic Survival Show,’ because that’s the one the gold bugs love the most.

I called up GoldMoney because really, I keep hearing about this company and I never, shame on me, I never really took the time to check it out. I finally checked it out. About a week or two weeks ago, I guess I did. I looked at their website, I read a bunch of things on there, again, the premise being correct, great, true, et cetera, et cetera. I called them up and they are in Jersey. Now, don’t confuse that with New Jersey. Jersey is an island off of England and it is somehow part of the British Crown but not really, I don’t understand it. It’s like a sort of a separate country that has its own laws but it’s part of England at the same time. Maybe it’s like a territory like Puerto Rico is to the U.S. I don’t really understand it, but, whatever.

Anyway, they claim to be this great asset protection location and financial privacy location. All that may be true. I don’t really know. I don’t have much to say about that. But the company, I talked to them. I asked them what it’s all about, explain to me how it works. You set up an account, you wire us money, dollars or whatever currency you live in – whether it be euros, dollars, whatever it is and you put money in your account and then you start buying up gold and silver. I said, “Okay, so where’s the gold and silver?” “Well, we have three different locations around the world where we store it in these vaults.” This is like Peter Schiff who comes on my show and I like Peter Schiff. I lost a bunch of money with him, investing with him, I wouldn’t recommend him in that way. But whenever I hear Peter Schiff on the news, he makes complete sense to me. I agree with him. I don’t know. I think I sent him some money to support his campaign when he was trying to be a senator. I would love to see Peter Schiff in government. He’d lessen the size of government and he and Ron Paul would probably do us some favors. But that doesn’t mean that his argument holds water because Peter Schiff comes on my show and he says, “With all our fiat money, blah-blah-blah,” all the usual premises and all the usual arguments and he says, “Well, right now, I highly recommend that people buy these gold certificates for gold kept in the Perth Mint in Australia, in Perth. Why would anyone who believes that all of these arguments about fiat money trade their dollars that they could spend a day and buy something that with intrinsic value that they could hold and possess? Why would they send that to some company offshore? Because they will give you a certificate or not even a certificate, they will put on the website where you have your little private login and look at your statement on a computer screen that says you have this much gold or silver.

Do you realize how many scams have been created in that stuff over the years? I mean it blows my mind that all of these people think that they have all these apocalyptic scenarios and they think, and listen. I don’t trust the government. You know that. You’ve heard me talk on the show about it. But they would rather give their money to some private offshore company for them to save the – isn’t that the ultimate fiat money that they say they have this gold in some vault somewhere around the world that you don’t see, you don’t possess? They say you control it. But let me tell you if the S-H-I-T hits the fan, excuse my language there, if it hits the fan, do you really think this gold and silver is going to be there? And do you really think you’re going to have the opportunity to somehow get it, take possession of it, use it, collect it? I don’t know. If you think that, you really better wake up because this whole fiat money thing I mean, at least, you can trade your fiat money for income property now. Or you could buy physical gold with it or physical silver and take possession, that’d be a lot better but these people trading money for certificates, it’s like fiat money for fiat money.

Our dollar is fiat money because the Federal Reserve says that it has value and our government has legal tender laws that say it has value. But now, you’re saying you’re going to trade that money for a certificate from some other just some private offshore company that says you have something? You got to be kidding me. I just think of the gold bugs kind of have to get a clue and wake up. They are the ones who believe in the apocalypse, in the doomsday scenario so that’s why I talked about it. It just doesn’t make sense to me. At the very least, you got to have the physical stuff and remember that money is just money and money is great but it’s not an investment. Gold and silver are just money. Get over it for thinking it’s anything more than that like some kind of offensive strategy it’s going to create wealth.

You know what I say to do? Trade your fiat money now for hard assets like income properties, things that everybody needs that are the basis of human existence, residential-type housing, income properties, apartments, single family homes, et cetera, et cetera.

And speaking of which, the institutional players, a little more on them coming into the business, here’s a Bloomberg article and this is just a recent Bloomberg article, January 31, I believe, foreclosures draw private equity as U.S. rents homes and just skipping around the article just highlight a couple of parts for you real quickly. “Private equity firms are jumping into distress housing as the U.S. Government plans to market 200,000 foreclosed homes as rentals to speed up the economic recovery.” Wow, that’s like water run over a hill, we always used to say. You should really be concerned when someone says, “I’m from the government. I’m here to help,” [laughter] because you know that’s probably not going to work out the way they planned.

It says, “It’s a massive market,” they’re quoting some guy with a private equity firm, Shapiro here. “It’s a massive market,” Shapiro said in a telephone interview from New York, “we’re starting to see this as a billion dollar opportunity to buy rental housing.” It goes on to say, “An S&P/Case-Shiller index of property values in 20 cities…” Only 20 cities out of what? 400 markets around the U.S., only 5% of the market, yet, it is the index that everybody quotes. Again, how can people be so footing clueless to keep quoting S&P/Case-Shiller – only 20 markets, only 5% of the housing, the real housing picture of the United States? What about the other 95%? What about the other 300 in 95 markets in this country? Again, amazing. Amazing how things like the gold bug mentality, the S&P/Case-Shiller, the Wall Street mentality, this life-insurance-as-an-investment mentality. Amazing how these things are so obviously flawed, yet, they become sort of revered as though they are truth. How does that happen? I don’t know how they do that. But I got to figure that out for myself.

So all of this thinking that we understand here on the show will become the mainstream revered thinking. It’s probably better that it’s not because there’d be too much competition if it was that way and all the opportunity would be gone for us.

Anyway, it says that this 20-cities survey which is nothing 5% of the market, it shows that this has dropped 33% from its peak in July 2006 and 12% of homeowners with a mortgage are either delinquent or in foreclosure. Guess what those people are going to need soon – rental housing. Why? Because they’re not going to have good- enough credit to be buying. And then there’s a subpart of the article that says, “Increasing rents. Increasing rentals may reduce lenders’ losses on foreclosed and surrendered properties and curb declines in home prices, according to a Federal Reserve study Chairman Ben Bernanke sent to Congress on Jan. 4.” It just goes on to talk about how these private equity groups are getting into the housing market. And, again, folks, let’s all like wish them luck because I bet you they’re not going to be very successful at it. But, hey, let them try because they don’t really understand how fragmented, and you’ve heard me say it before, embrace the fragmentation. This business, the reason the opportunity is here for us and it’s so wonderful and so incredible on this multi-dimensional asset class of income properties is because it’s just too fragmented. Institutions have tried this before and failed many times. We’re talking private institutions.

The government actually thinks they’re going to succeed at it, give me a break. Just point out a “successful” government housing project anywhere in the country, I’d love to see that one. The government housing projects I know about are pretty much drug-infested, crime-infested, nobody cares about these type areas because, again, when it’s everybody’s money, when it’s everybody’s property, then, it’s nobody’s money and it’s nobody’s property. Collectivism simply does not work. It is the antithesis of human nature. Collectivism does not work. It will never work. It has never worked anywhere on the planet. It has never worked at any time in human history and I say it will never work in the future.

But on with the article. It says, ‘”It marks the first time that institutional investors are really getting involved,” in the process, “and in the process providing a higher quality product to a tightening rental market,” says Oliver Chang, a Morgan Stanley analyst in San Francisco.’ Hey, this is fine with me. I think it will hasten the recovery but I don’t think these institutions are going to be very successful at it. But let them try. It’ll just put a little dent in the cycle and then we can pick up those properties. From the institutions, when they decide they can’t be in the business in a couple of years because they don’t understand how it works and it’s just too fragmented for them.

The article goes on to say, “The U.S. homeownership rate was 66.3% for the quarter ending September 30, as low as 1998 levels and down from a peak of 69.2% in December of 2004, according to the U.S. Census Bureau. The fourth quarter report comes out today.”

“New households have a much higher propensity to be renters,” Thomas Lawler, a former economist with Fannie Mae,” Fannie Mae has a reputable organization. I hope you could tell when it’s me talking and when it’s the article. I’m sure you get it, who’s now an independent housing consultant in Leesburg, Virginia. “And a lot of folks who are losing their homes to foreclosure are now renters.”‘ And the article goes on to talk about how rental demand is increasing, increasing, increasing.

So let’s just look back at what it said about the homeownership rate. So we see that it’s gone down about 3%, according to this time period they’re talking about, about 3% and every 1% decline in homeownership rate equals about 1 million new renters. Congratulations, investors, listening to the show, because that is your opportunity the world your oyster.

On the cover of the East Valley Tribune, it’s one of the smaller community papers here in the Phoenix, Arizona area, and it says the front page and this is about a week ago, where’s the date on this thing? Anyway, it’s just about a week ago, I got it out of the newsstand. It says, “Is the housing glut over?” And it says that ASU hires analysts to help the public understand the industry. It’s pretty upbeat and I got to tell you there are a lot of signs of recovery going on.

Certainly in election year, the Obama administration wants to spin it that way, I think oddly enough that a lot – as there are these signs of recovery, there’s a lot of sign that really it’s just a fleeting, temporary glimpse. Of course, they’re manipulating the stats. By the way, I have John Williams of Shadowstats.com on the show. I just recorded that interview last week. We’ll have it up for you soon. We talk about the real unemployment rate and the real GDP and how the government maligns the statistics and so forth. Very reputable website, very reputable guy and I think you’ll enjoy that interview.

But, again, it’s just a glimpse of a recovery, folks. This is not a real recovery in many ways. But that’s complicated and we’ll continue to talk about that on the shows as we have in the past.

Last thing here before we get to our guest, well, two last things. Number 1, be sure to join us for Meet the Masters. A lot of you have been signing up. We appreciate that. We look forward to seeing you, March 24 and 25, at beautiful Hyatt Regency Hotel. Make sure you register at JasonHartman.com and get your room reserved by calling the hotel. There is a link on the website because that room block is going fast and that is the $99 per night room rate, which is a steal for the Hyatt Regency in Irvine. Also, you get in on the early bird pricing with us. The price does escalate as we get closer to the event, of course. Currently at the time of this recording, the early bird price is $497 that includes two tickets for you and a friend, a spouse, whatever. But it is two tickets and, again, join us for Meet the Masters. Register at JasonHartman.com/events and we have a dynamite Meet the Masters event planned. This will just be a phenomenal event. Be sure to be there and we will address a lot of great topics and have a lot of great speakers for you.

Last thing here on institutional and commercial-type investing, I know I’ve done on a rant about that too. I’ve done on a few rants lately, haven’t I? But recently, I got an email from this same group this Case group and just goes to show you how really bad a lot of these larger commercial real-estate investments are. This one, I just wanted to mention because my ex-girlfriend, who is now married, she and her husband, she was telling me this story several months ago, how they had invested in a Dollar General store in Texas. And a lot of people as private investors who have a little bit of money, they like these Dollar General stores and/or these types of triple net-lease-type deals like that. I talked about them on the last show. Institutional investors like them too. This one’s too small to be institutional but the larger institutional ones I’ve had car maybe a [unintelligible 28:16] I told you about they like.

This one, it was interesting because I got the email and I thought Dollar General and I remember the story she told me about what happened to her and her husband, how that deal did not work out well at all for them. They, by the way, did not buy it through us because we have not recommended investments like this before. But this deal’s a $1,577,000 and didn’t even have a cap rate on it. I emailed them back, I say, “What’s the cap rate?” Well, it’s 7.25%. You’d have to look really hard and I bet you couldn’t even find it at JasonHartman.com, in the Property Section, to find the cap rate that low and that awful. It just goes to show you but let me just tell you what’s interesting. These triple net deals are supposed to be these like sure things, right? Well, my ex was telling me that she and her husband invested in one of these deals, it was a Dollar General store, just like this one and guess what happened?

Everything started out well. They put their money in there. It was a triple net lease, really simple because in the triple net, the landlord really doesn’t have any real big responsibilities at all because all the expenses pass through to the tenant and these are long-term leases – 10 years, 15 years, 20 years, whatever long time. Everybody that does these things, they think they’ll be just really simple.

Well, guess what? It wasn’t so simple in the story she was telling me because they decided this was an older location or it was an inferior location. I think it was older store, an older building. But I might have just been they wanted to change locations. Anyway, they had an opportunity very nearby to have a better location. Guess what they did? They just simply broke the lease and moved to the new location. And leaving these people, these landlords, they got to just sue them and a lot of these are franchises and they use entity structuring and they can just bankrupt one of the entities and it’s just complicated. These deals are not as simple as they seem.

And then, just because I replied to that email, this case group decided to send me like a dozen other emails on other properties they have that I have no interest in. But here’s one for you, another lame deal. $2.4 million can buy you an Advance Auto Parts store in Dearborn, Michigan. Gee, Michigan. The poster child for collectivism and big government that simply does not work. Here, the cap rate is a lousy 7%, lousy 7%. That’s a pretty lame deal. I think I’ll pass on that one. I think I’ll pass on the Dollar General. Let’s see what else you’ve got here.

Here’s Lincoln Park, Michigan which is Detroit, basically, gee, Detroit, even worse than Greater Michigan economically and with crime and so forth. And this one’s even worse. These are more Advance Auto Parts locations. Here’s one, $2.3 million, a lousy 7% cap rate in crime-ridden Detroit. Here’s another one in Detroit. This is in Eastpointe area of Detroit and this is $2.2 million and another lousy 7% cap rate. Here’s a PNC Bank location. This is a triple net lease too. It’s $2,063,000 million and the cap rate, are you sitting down. This is the kind of stuff so many people are investing in. I cannot believe people buy this crap cap rate, 5.5%. That stinks. That deal is lousy. Again, single-tenant, free-standing buildings, if you want to put another tenant in there, if they ever default, you got a whole rebuild on your hands basically most of the time because they’re such specialized structures usually. This is just incredible, the kind of junk that people are buying out there, I just can’t believe it.

And so, two-fold on this, just like I said on the last show. One reason you don’t like this deal is because as an investor, if you were to buy these things as a single investor, they have crappy performance. But number two, say, you were to invest with a REIT, a real estate investment trust, some kind of fund, some kind of traded asset like a Wall Street asset. A company that is a mutual fund portfolio of a bunch of these companies, or whatever it is, this is the kind of junk they buy. These deals are just not good.

Look at this one. Here’s one for you. This is a Kohl’s. You know K-O-H-L, the department store? This is a Kohl’s Ground Lease in Livermore, California. It’s $10,953,000 million and the cap rate is a lousy, measly, crummy, crappy 5.25%. Again, it amazes me that people buy this stuff but they do and this is what institutions are buying and what private investors; a lot of doctors buy this kind of junk. A lot of people that are otherwise smart the rest of their life, they could be doing so much better.

Enough of the rant. Remember this is a 10 show. We’re not supposed to be talking financial stuff. But, pardon me, I can’t resist. Anyway, we’ve got a lot of great shows coming up, a lot of great client interviews I’ve been doing lately and thank you so much for those of you who have come on the show to record with me, really can’t wait to have the rest of our clients learn from your wisdom as I have, my team has. We’ve got a lot of great interviews from guests who, like I said, John Williams coming up. We’re going to get John Perkins coming up and just a whole bunch of others I can’t remember but we’ve been recording a lot lately.

It’s going to be a great year of opportunities and education here on the Creating Wealth Show and with our group and so forth. Visit JasonHartman.com, take look at properties, register for Meet the Masters. And we have that promo code and a lot of you, one more thing here, a lot of you have been purchasing the products, thank you for that. These were some pretty steep discounts. I think we’ll have to turn this off here in a week but we’ll let it run just a little longer. This is the one that really you just can’t live without. Get the Creating Wealth Home Study Course for $200 off at JasonHartman.com. It’s $297 normally. You can get $200 off, I so want every person listening to have this product. I’ll give it to you for $97 for another week. The promo code is CW200, you go to JasonHartman.com, you click on Products, you select the Creating Wealth in Today’s Economy Home Study Course, you type in the promo code, CW200, and you’ll get it for $97. We’ve never done a deal like that ever, ever before. I want everybody listening to have that course. It is so valuable.

Let’s get to our guest, Dr. Gay Hendricks, who’s going to talk about the Corporate Mystic, who’s going to talk about his other great stuff, his great teachings on relationships and so forth and he comes to us from beautiful Ojai, California. So we’ll be back with that in just a moment.

Be sure to join us and Meet the Masters on March 24 and 25 at the beautiful Hyatt Regency in Irvine, Southern California. Register now to take advantage of these very special $99-block room rate at the Hyatt Regency and our early bird pricing. Register at JasonHartman.com. [Advertisement]

My pleasure to welcome Dr. Gay Hendricks to the show. He is president of the Hendricks Institute and author of several books and they include The Big Leap and The Corporate Mystic and many other books on relationship and successful personal living. Gay, how are you? Welcome.

Gay: I’m very well, thank you very much. Great to be with you.

Jason: You’re coming to us from beautiful Ojai, California. Gorgeous place. I love it there.

Gay: I do too. We’ve been here about 10 or 11 years now and every year, I love it even more. It’s a beautiful little mountain valley for those who aren’t familiar with the area.

Jason: Yes, it really is. Hey, tell us a little bit about your work and your background and what you do at the Hendricks Institute.

Gay: Yes, at the Hendricks Institute, which has been in existence now since 1989, so let’s see, let’s have about 27 years. We offer two types of seminars. We offer seminars in relationship enhancement and we offer also seminars in body-mind vibrance and Conscious Living. You might think of part of our work is about how to feel great inside yourself and part of our work is how to feel great in your relationships and how to have great relationships. We also extend that into the business world. We’ve had over the years about 1,000 executives and CEOs and board members of different companies come to us for intensive learning things where, for example, a common thing for us would be the CEO of a company comes here and we work with them all day long on creating a new direction or a CEO might come here with his or her spouse to work through some relationship issues that are kind of blending over into the business.

As you know, in the 21st century, it’s often difficult to tell where business leaves off and relationship begins. It just oftentimes you can have relationship issues that actually go over into the business side and then many business issues come over into the relationship side. If you’re going to be a successful business person in the 21st century, you have to be a student of relationship. And also if you’re in the world of transformation, if you’re a therapist or a coach or a consultant of some kind, you also really need to be open to business, too, because like, for example, in our Entrepreneur’s Program, I would say at least half of the people that take it are people who are consultants or coaches or somebody who works with other people in the transformational field.

And so, we kind of like to do both here. We like to do some seminars kind of for the general public but a lot of our work is advanced courses for business people who are changing directions or business people who are finding out how to work smarter and in a more balanced way.

Jason: Fantastic. Can you give us some specifics about that? I mean how does that apply to the business world especially – sounds like what you do is almost bordering to the area of industrial psychology.

Gay: It blends into all sorts of different areas. I’ll give you a crystal clear example. I used to consult with Dell Computer back during the 90s. And at that time, I don’t do it so much anymore but I used to do quite a bit of on-site consulting where I would go into Dell and work with their executives for three or four days. Or I would go into Motorola, wherever I was hired and Katie and I, we did a lot of traveling. In fact, we’ve both been on almost a million frequent-flyer miles back during the 90s, doing that all over the world. I would also go to Europe to do it frequently with – often with KLM Airlines, one of my clients in Holland.

But let me give you an example from the Dell days because it’s a perfect example of why you can never separate personal growth from business growth from pure, hardcore financial results. I was working one time with one of the top executives at Dell and he had a problem with anger explosion. He would get mad and beat on the desk and stuff like that. Then it would take a while for people to get over that. In talking to him, he would say to me, “I can’t understand why people get upset. I don’t mean anything. You know, like 10 seconds after I get angry, I forgot about it.” But it was hard for him to learn that everybody else didn’t get over it in 10 seconds. Sometimes, it would harm the trust factor for weeks at a time because people would be too afraid to say something to him for fear he might flip out. I noticed something in my work with him, I noticed that he had a kind of a labored way of breathing and I pointed out to him that he breathes like an asthmatic does. He said, “Yes, I’ve had borderline asthma a good bit of my life.” And I showed him a couple of different breathing things I had learned over the years in working with people with people with asthma and immediately it made a difference in his feeling about himself.

But here’s where it got really even more important. As we worked together, I pointed out that it sounded like when he got angry that what he really was was underneath it he was sad or disappointed about something with the person he was there with or something that was happening in the meeting. He says, “You know, that’s right.” He said, “I do. I feel disappointed in them or I feel almost hurt that they didn’t do it the way I wanted it to. I think I’ve been like my kids.” In that moment, suddenly, a light went on in him and he realized that when he got angry, it was really a cover up for deep sadness that he had inside.

And so, I said, “Why don’t you just tell people, ‘I feel disappointed or I feel sad.'” He said, “You can’t do that in a business situation.” And I said, “Well, think about that because you feel okay about beating on your desk in a business situation but that freaks people out. Why don’t you try saying, ‘I feel disappointed or I feel sad right now,’ next time you get angry?” And you know what? He did it and it completely revolutionized the culture around him. Because people suddenly realized that here was this kind of tender guy underneath this marine drill instructor rage-a-holic kind of guy. And as soon as he did that, he realized that he didn’t really need to have those anger explosions anymore. So it made a tremendous difference in the atmosphere around him and, of course, then spread down through the rest of the company.

So, any more in the 21st century, you can’t say, “This is relationship over here and that’s business over there.” They all sort of blend together and sometimes, it’s the most efficient thing to do. It’s just to work with everything all at once.

Jason: Yes, it certainly all blends over I mean, just to play devil’s advocate for a moment, I mean, the guy banging on the desk and getting all upset. Isn’t that sort of obvious that you shouldn’t do that in a business environment or in any environment, for that matter? He should control himself, right?

Gay: Yes, but you try to tell that to a guy worth half a billion dollars.

Jason: You’re right. Okay. I see.

Gay: [laughter].

Jason: I hear that about in particular, one bigwig name that we all know and all the listeners know, and it’s Bill Gross with PIMCO, the [unintelligible 43:21] manager. I hear he can be temperamental and there’s bon craters on the floor, cuss, and get really angry and are high-strung. I heard that about him too. It definitely goes on with successful people, maybe more so they’re not.

When it moves over, Gay, into the personal relationship side, is that really where you got your start? I know you’re a professor for many years and you counsel people on their romantic relationships, right?

Gay: I actually started out working with juvenile delinquents. Just to give you my background, I never thought of ever being a counselor, a psychologist or anything like that. Until one magic day in 1968, I was a teacher and a counselor at a boarding school for delinquent boys. But ‘counselor’ meant ‘dormitory counselor guy that rode herd on 24 juvenile delinquents.’ It wasn’t like a therapist-type counselor. It was more like a combination of a jailer and a babysitter and they hired me because I was big [laughter].

That was my job in 1968 until one magic day, I was decided to get my master’s degree in creative writing and so I was going down to the University of New Hampshire in the evenings to take classes and one day, a friend of mine I’d gotten a ride down with him and my class ended earlier and I went by his class to see if he was finished yet and he was taking a counseling class. And in the counseling class, they were sitting around in groups of eight, having little kind of like a personal encounter groups where one person would talk about an issue in their lives and the other person would – other people in the group would give in feedback on it and they invited me to come in and I sat down and kind of was a guest in one of those groups and it changed my life because I had never thought in my life of people ever talking about their problems. First of all, that was not on my radar screen. I’ve never seen a therapist, really probably never given 10 seconds of thought to anything like counseling or personal growth or anything like that.

You got to remember this was back in the 1960s when there wasn’t a lot of that stuff. It was in the era before self-help books or before cable TV had people on like Wayne Dyer or folks like that. It was really a different world back then.

I got so fascinated with the possibilities of human transformation, my life just changed so much over the next year. I joined that class and then ended up getting my master’s degree in counseling. I’ll tell you, Jason, I never had a dull moment since then.

Jason: Great [laughter].

Gay: I have been absolutely fascinated by human beings and the power of change for most of my life now. And it still wakes me up every day feeling just as excited as I was 40 years ago. It just led from one thing to the other. I ended up because of my experience at University of New Hampshire, I ended up getting my doctorate at Stanford, where one of my professors at New Hampshire [unintelligible 46:14]. And I came out to California and fell in love with California. And then, as I said, I became a university professor. But my real love is not in sitting down one-on-one. I do some of that but I don’t do it a lot anymore because my real joy are things that can influence lots of people where you can take a piece of knowledge and put it in an e-course. For example, like we have a course for people who are interested in relationships, singles and couples call Lasting Love Made Easy and people take that course to enhance their relationships. And I love it because thousands of people can take the course and I can open up my email each day and I get emails from people in Pakistan and Burma and Canada and Beverly Hills saying, “This changed my life and it did it while I was asleep.” They were able to work on something without my physical presence there.

We’ve kind of gone in a direction of doing a lot of virtual trainings and electronic things and digital courses and things of that nature. We still do quite a bit of live training but, like for example, my Entrepreneur’s Course only takes about 50 people in it. I can only take about 50 people a year to do a really good job on it. It gives me a lot of opportunity to work closely with the people, too.

Jason: Tell us about some of the secrets to successful relationships? What is the secret of attracting lasting love? You have a program on this topic, right?

Gay: Yes, one of the secrets first of all, is to make a commitment to it, to actually make a formal commitment to the process of bringing your ideal mate into your life. A commitment is different from something like, “Maybe I’ll do it someday.” A commitment is saying, “I commit to bringing my ideal partner into my life within the next year.”

Jason: Just like a commitment to anything.

Gay: Yes.

Jason: The exercise and fitness or eating healthily or business goals or whatever it is, right?

Gay: Exactly. Because until you make a conscious formal commitment to do something, you’re unconscious commitments are often come up and ruin the day. Like some of us have an unconscious commitment to alienate people or we might have an unconscious commitment to be lonely. You got to kind of just make that conscious commitment to bringing the right kind of mate into your life. So that’s step #1.

Step #2, this can take 10 seconds or it can take 10 months, depending on how much attention you give to it. The second really important step is to open up and get willing to love the part of yourself, the unlovable part of yourself that’s in the way of you bringing the ideal relationship into your life.

Like for example, in my own relationship life, early on in my life, I created several situations where I would really get involved with someone and then they would leave, for one reason or the other. And I didn’t realize for a long time I kind of thought that was their problem but then, one day, I realized that, “Oh, this is me that keeps inviting that kind of person into my life. Why would I do that? Oh, I must have an unconscious commitment to be abandoned.” And so, once I started looking at it that way, suddenly, I realized, “Wow, I can see where that comes from because like right after my birth, I – my mother had some problems and so I couldn’t really bond with her. I was kind of turned over to other people and my grandmother came in finally and stepped in and took over. But in that early days in my life, I guess my mind must have taken a picture of people not being there for me or maybe people are supposed to abandon you. That’s what my mind came up with, I think.

And so that happened over and over again until I kind of caught the pattern in my 20s and then, in my 30s, I was finally got around to doing what I’m telling you to do now [laughter], which is to make a commitment to it and find out that little unlovable part of yourself and love that. And that clears the way then for that person to come into your life. Because here’s the problem. If you try to attract someone into your life to love you even if you don’t love and honor yourself, if they try to love you, then you kind of push it away because you don’t think you’re fundamentally lovable.

So that’s I’d say the big problem that in our e-courses like Attracting Genuine Love and Lasting Love Made Easy, we handle that problem. You solve that problem right there on the course through a set of ingenuous exercises and processes. It’s not a hard problem to solve. You just have to pay attention to it for a little while and get yourself focused on it.

Jason: Let me take a brief pause. We’ll be back in just a minute.

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Jason: What else should people know about, advice that you have for entrepreneurial success, I mean you’ve started and turned around several companies and you’ve really had an amazing career I mean what can you tell people about that?

Gay: Well, I would say, the first thing I would tell people that in working with around a thousand executives so far, as well as my own career, I would say that if at all possible, get yourself focused on finding something you love to do because without that, you really don’t have a good foundation for, certainly for entrepreneurial life.

The life of the entrepreneur is different from the life of a different kind of business person. Entrepreneurs kind of live out there on the edge in a way. The very term ‘entrepreneur’ means you’re between two parties, you’re between the people that make the stuff and the people that buy the stuff. You’re between the people who finance the stuff and the people who use the stuff. So you’re ‘entre’, you’re between. And so, it’s kind of a free-floating zone that the entrepreneur lives in.

But it’s extremely important to understand that it’s a different type of lifestyle than it is with other types of business situations because entrepreneurs shouldn’t try to make themselves feel serene, for example. You shouldn’t work overtime on your serenity. Put away your serenity, put that in second place. Put creative exhilaration in first place, in your intentions. Because in an entrepreneurial life, if you can find something you love to do and something you can really get your heart behind, you’ll do it 24 hours a day, whether you make money out of it or not and then, it just becomes a matter of finding out the right way to make money at it.

I tell you, Jason, I was blown away when I first discovered that I could make a very good living just being myself and doing what I most love to do. That to me is one of the most astonishing things I’ve ever learned in my life. It’s a miracle, really.

Jason: I have to say the exact same thing. I couldn’t agree with you more. Maybe I shouldn’t even say this on the show. But I tell you, I do what I do for free because I just love doing it so much [laughter].

Gay: [laughter] Yes, but that’s a great way to be though because if you got something that you would cheerfully do for free from dawn ’til dusk and later, you’ve got to treasure that, it’s just priceless. Because it’s so easy then to start finding ways to bring that into something that produces revenues.

It’s always amazing to me like I mentioned that 50 people that are in our Entrepreneur’s Program, I would say that those 50 people, at least 10 of them a year, absolutely astonish me by the kind of businesses they create, that are so different from anything that I might have conceived of or anything like that. And I give them the basic structure for how to do it and kind of take a weekly approach – do this this week, do this next week and we move through it in a very systematic way. But at the end of the day, they’re on their own. And you are as an entrepreneur, you’re a self-starter. It always tickles me pink to see the amazing diversity of businesses that people start creating revenues with.

Jason: Yes, it really does. Give out your website, if you would and tell people where they can learn more.

Gay: Sure. Our basic website from which you can use as a jumping-off place to all the other stuff we do, is very simple, that’s Hendricks.com, H-E-N-D-R-I-C-K-S.com. My wife Katie and I built our first website with a friend of ours sitting on the floor of our house out in Colorado. I think we’ve had one of the very first websites out there. I’m one of those kids in junior high school that ran the AV equipment, the kids that nobody would speak to but I’m sort of a geek at heart. And so, I take pleasure in kind of learning things from the inside out.

Nowadays, websites are so complicated that I don’t know how to do them anymore. But in the early days, they were fun to – I just put together on our own. And so, we had one the very first ones out there. So Hendricks.com is the way to go and you can find out about all the stuff we do there and get a jumping-off place to the other courses.

Jason: Two more questions before you go real quickly. In your book, The Big Leap and The Corporate Mystic, you talk a lot about integrity. People throw that word around and abuse the heck out of it, in my opinion. What does it mean in practical, everyday terms?

Gay: The subject of integrity, some had been fascinated about for years. Let me give you a couple of examples. One thing it means is being in harmony with your life purpose so that what you’re doing comes out of your consciously chosen purpose for your life. So that’s one way of being an integrity. But there are several others.

A second one is how you speak, whether what you say matches your internal experience. In other words, do you speak honestly or not? And as you know from lots and lots of examples on television and in politics, all somebody has to say is one little thing like, “I didn’t have sex with that woman.” And suddenly, a whole world of unpleasantness begins to unfold. But it seems like human beings are kind of slur to learn that key lesson. But the second part of integrity is learning how to speak honestly.

A third part of integrity is taking responsibility instead of coming from blame or criticism of others. In other words, taking full responsibility yourself and requiring that others, in relationship with you, take a 100 percent responsibility too. Because jobs are only done by people who take full responsibility, not 120 percent responsibility, you need to take responsibility yourself but give people room to take a 100 percent responsibility themselves.

Jason: Okay, good. And then last thing real quick. What have been some of the most important moments for you and Katie in creating your own wealth?

Gay: Great question. Gosh, nobody has asked me that before. One gigantic moment was way back before we wrote Conscious Loving and before we appeared on Oprah for the first time. I got this idea of a certain kind of book I wanted to write and it became our book, Conscious Loving. Katie and I wrote it and our agent at the time, sent it back to us and said, “Here are some things I really love to see you do to this. Now, there are big things and you’ll probably have to turn yourself inside out to do them to the book. But if you do them, I think I can sell it for a lot more money than I’ve been selling your books for.” They’ve been selling my books for $10,000 or $20,000 advance or $25,000 advance, something like that, which wasn’t bad back in the 70s and 80s but she saw something different in it.

And so, when I saw all the changes she wanted me to make, it broke my heart but I decided just to bite the bullet. Then I remember blocking out one entire weekend and just putting in a bunch of 18-hour days for two or three days until I got it done and I sent it back to her and she took it to New York and held an auction. And suddenly, we were being offered a quantum degree more money for that book than we’d ever been offered before. And so, we ended up selling it to Bantam Doubleday Dell. But then, when the book came out, the first call the publicist made was to Oprah and she invited us on the show as a result of a 10-minute conversation.

So in one day, we’re going from working with six couples in our living room, literally, to flying to Chicago and doing a show where it hits 10 million people where we’re doing exactly the same kind of thing.

Jason: Scalability and duplication.

Gay: Exactly. And so, there’s a wonderful quote from a Tibetan guru named Chögyam Trungpa, he’s now dead but he escaped from Tibet way back and came to the United States and started a small monastery. And after many years of work, one of his students donated a million dollars to the ashram. And so, they suddenly went from being this small struggling organization to suddenly having this instant wealth. And they asked him what it felt like. Now you got to experience – here’s a guy who had ridden out from Tibet on a donkey or a mule or something in the middle of the night in freezing weather and suffered endless hard times. And so, he said, “If you work diligently and with passion, such auspicious coincidences are bound to occur. If you work diligently and with passion, such auspicious coincidences are bound to occur.”

And it’s the same thing Louis Pasteur was saying when he said, “Chance favors the prepared mind.” So what you do is you put yourself passionately into what you love to do and then just watch the miracles that begin. The Universe falls all over itself trying to help you.

Jason: Yes, well, like Earl [unintelligible 1:00:23] said, “Luck is what happens when preparedness meets opportunity,” right?

Gay: Yes.

Jason: Very true, very true. Gay Hendricks, thank you so much for joining us today. That’s Dr. Gay Hendricks, the website’s Hendricks.com and we appreciate these insights.

Gay: All right. Blessings to you.

Jason: Likewise.

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