Momentum Podcast: 607
This is Officially an Economic Crisis
by Alex Charfen
Last week when jobless claims numbers came out, the secretary of US treasury Steve Mnuchin said that the numbers were not relevant because it was a stimulus package that was about to be released. If you follow me, you know I said not only were the numbers relevant, but this was a ridiculous statement. Last week's numbers were seven times the previous record.
Since last week I've been waiting for the jobless claims number to come out this morning. When it did I was dizzy.
The new jobless claims number is 6,648,000 people in a single week. This beats the previous record from 1980 to 695,000 by almost 10 times. As entrepreneurs, we need to understand that this is a long-term issue and a challenge we will be digging out of for years.
Full Audio Transcript
This is the Momentum podcast.
This is officially an economic crisis. Last week when the jobless claims numbers came out, the Secretary of the US Treasury said that the numbers were not relevant because of a stimulus package that was about to be released. But, if you followed Alex for any length of time in the past few weeks, you know that not only were the numbers relevant, but that statement's kind of ridiculous.
Over 10 million people have filed for unemployment in the last two weeks. In this episode of the Momentum podcast, Alex is going to break down exactly why this issue is so important for entrepreneurs to understand, and exactly what you can start doing today to help humanity push forward. I hope you enjoy.
Alex Charfen: I'm Alex Charfen, and this is the Momentum podcast, made for empire builders, game changers, trail blazers, shot takers, record breakers, world makers, and creators of all kinds. Those among us who can't turn it off, and don't know why anyone would want to, we challenge complacency, destroy apathy, and we are obsessed with creating momentum so we can roll over bureaucracy, and make our greatest contribution. Sure, we pay attention to their rules, but only so that we can bend them, break them, then rewrite them around our own will. We don't accept our destiny, we define it. We don't understand defeat, because you only lose if you stop, and we don't know how.
While the rest of the world strives for average, and clings desperately to the status quo, we are the minority, the few, who are willing to hallucinate there could be a better future. Instead of just daydreaming of what could be, we endure the vulnerability and exposure it takes to make it real. We are the evolutionary hunters, clearly the most important people in the world because entrepreneurs are the only source of consistent, positive human evolution, and we always will be.
Good morning, everyone. Ever since last week, when the jobless claims number of how many people lost their jobs last week came out, I've been waiting for this morning. Last week, we had 3.28 million people lose their jobs in the United States. To give you perspective on what that means is that the previous record was 695,000 in 1982. During the foreclosure crisis, I think we got to around 645,000 jobless claims numbers in a single week. So, let's get very real about what's going on.
Last week, we had 3.28 million jobless claims numbers, that was about seven times the previous record. I'm frustrated now, so you might hear some frustration in my voice. Last week, Steve Mnuchin, I think that's how you say his last name, the director of the US Treasury, which I have some experience with ... I actually worked with Director Lockhart, the previous director of the US Treasury, or one of the previous directors of the US Treasury during the Obama administration, during the foreclosure crisis. So I know the position, I understand what his position's responsibilities are, I sat two chairs away from the person who was in his position previously, at a round table. He came out last week and said that these numbers were not relevant, that 3.28 million losses was not relevant, because there was a stimulus bill that was coming out.
Well, if you saw my lives and if you read my stuff, you know that I said not only are they relevant, but this is a massive, endemic, international emergency that we had 3.28 million people lose their jobs. That puts us into an instant recession, an instant, some would say, a depression. This morning, I was waiting for the job loss numbers to come out, I've been up since literally four AM, doing beautiful [inaudible 00:03:31] notes over here, and trying to figure out the math behind this, and here are the numbers today. 6,648,000 people lost their jobs last week. When we combine those two numbers, 10 million Americans have lost their jobs in the last two weeks.
If we look at what that means, if we look at how much money has been pulled out of the economy, here's what I want you to know. This is a time to understand what's happening, this a time to be a realist. This is a time to understand that this will be the most challenged economic market any of us have ever been in. This is the most challenged market any of us have ever been in. What that means for us, as entrepreneurs, is that we need to do the following, immediately.
to the fact that we are in a crisis market. This is a crisis, we are going to have challenged spending for a long time. You're going to see people's incomes go down, you're going to see people be much more careful with what they're spending. In a crisis market as an entrepreneur, if you've been selling somebody something that improves, something that feels good, something that is a vitamin, in a crisis market, vitamins don't sell. I don't mean that literally, I'm not talking to supplement companies. But I'm saying, if your offer is an improvement offer, you need to get to a painkiller. Something that stops pain, something that helps people right now, something that helps them in this crisis, start pivoting now. That's number one.
Number two is we are going to see massive restructuring in a number of industries. I will share my predictions with you here, but I want you to know I'm preparing a thorough webinar to be presented next week, on Thursday. We will be emailing it out, so if you're not on my list go to Charfen.com and get on my list, you're going to want our information because throughout the foreclosure crisis, we analyzed this information, we shared it, and we can tell you what it means. So, here's what I want you to know the second part of this is.
The industries that we are going to see massively reset, effective right now, we are going to see a massive crash in real estate right out of the gate because when 10 million people lose their jobs, we are going to have a massive, massive number of foreclosures. I'm a landlord, we have properties here in Austin, we are already being told we're not going to get paid this month by multiple tenants. So, you're going to see massive foreclosures, and massive evictions. Here's what the government has done, because of those two things during the Coronavirus, they've put a hold on foreclosures and evictions, for two weeks.
Here's what that means. To the average person, who doesn't understand real estate, and don't understand the situation, they say, "Great, nobody's going to get foreclosed on in the next two weeks so if they don't make their payments, they're okay. Nobody's getting evicted, if they don't pay rent they're okay." Well, here's the reality is foreclosure proceedings take months, so the people who are being foreclosed on in these two months stopped paying their bills a long time ago, that's yesterday's problem that we're solving. Same thing with rents, if you stop paying your rent today, the fastest you can get evicted, I think, is here in Texas, it's about 60 days, maybe 80 days to get somebody evicted. In most jurisdictions, it can take three months to nine months to get somebody evicted. There's some really weird jurisdictions here in the US, where it can even take longer than that.
So, here's what people hear when they hear foreclosure and rent moratoriums, is they stop paying their bills. Here's the math we need to do. 10 million people lost their jobs, they're not going to pay their rent, they're not going to pay their mortgages. And now, the government is sending out stimulus money that is barely going to cover their bills.
So, here's what we need to understand. Number one, this is a massive economic crisis. Number two, we are going to see pain in a number of industries. Commercial real estate, residential real estate, automotive, banking, retail, the entire finance sector. We are going to see massive growth in industries as well. Those are going to get crushed, but what is going to grow like crazy? Clearly, teleconferencing, remote working, telemedicine. eCommerce is exploding right now, I have eCommerce clients that are having record weeks because everybody's buying online. There is going to be a massive shift from in-person retail to online retail, we're going to see a massive shift from in-person medicine to online medicine, we're going to see a massive shift from in-person consulting, and therapy, and service businesses, to either online or mobile, where you're going to people's houses.
Here's what I want you to know what this crisis. The way that the government has been talking about it, the way the news media's been talking about it is a short term, few week issue. I heard this all the time during the foreclosure crisis, and it frustrated me because that is the worst type of misinformation. Here's what I want every entrepreneur who follows me to know. We are in a decade long, or more, issue. Effective today, there is no way we're going to fix this with stimulus, there is no way we're going to fix this with another check from the government.
This is going to take time. We are going to have to work through, first, a wave of commercial property that comes onto the market, then a wave of residential property that comes onto the market. Then, automobile manufacturers are going to have a hard time selling anything new, or getting financing for it. We are going to see massive, catastrophic financial distress. I say this because I want you to know reality.
Now at the same time, everything I just said, massive, catastrophic financial distress, there's going to be industries that will reorganize, and clearly, massively taken apart. The travel industry, the hospitality industry, events industries are all shut down right now. But here's what I want you to know, as an entrepreneur, and here's what I truly believe. This is the biggest opportunity we've ever had.
Napoleon Hill said, "Every adversity carries with it the seed of an equal or a greater opportunity." I believe that with all of my heart, because in my life if there's one thing I've faced, it's adversity. I went through the Dot Com crisis, through 911, through the stock market crash, through personal crisis, I almost died when I was a kid. I've had tons of stuff go on in my life that tells me that adversity absolutely creates opportunity. In this case, here's what I want everyone who follows me to know is that this is the biggest opportunity in the history of man, period. Organizations or entire industries will be reshuffled. You know what I told somebody the other day? In a normal market, you can't displace Hilton, you can't displace Marriott. In a market like this, anybody who is the entrenched player can be displaced, completely. If you look at the Great Depression, it's uncanny how many multi-national, international corporations were started, billion dollar companies were started during the Great Depression.
So, here's what I want everyone to know is if you're an entrepreneur, here's our mission, here's what we must do, here's what we have to do right now, for the good of humanity. We must rise above the noise, turn off the news. Read what you need to, do not watch video. Rise above the noise, identify the opportunities that are out there, grab hold of them, make them happen. Make them happen, get into momentum, and take the world with you. Because here's what's happening right now, there's going to be a reorganization, a reshuffling, a complete change in the entire planet, and we need to be there to understand what to do next.
We, as entrepreneurs, will drive this forward, like we always have. Here's what I want us to know about this crisis, there's no way under it, around it, or over it, we must go through it. The faster we decide that is what we're going to do, the faster we will get there. I want you all to know that entrepreneurs are the most consistent source of positive human evolution, and we always will be. This is an opportunity not just to grow your business, to make a contribution, to grab market share, to be able to help more people, but this is an opportunity, I truly believe, to advance the evolution of mankind in a massive way.
Right now, things are changing. Things that should have happened a long time are now happening, people can work remote, there's not as much travel, there's not as much greenhouse gases going in the environment. There is a massive evolution happening right now, and if you understand the numbers, and you keep your wits about you, you will win. I want to you remember, the calmest person in a crisis wins, the person who's the calmest is the one who knows the answers.
Join me next week on Thursday, for the webinar that we're going to be doing where we share all of this information. And then right now, go to the Billion Code community on Facebook, join our Facebook group so that you can get updates like this, so that you have a community that will help you through this crisis. Let us support you throughout this, because we are going to be doing this for a long time. Go to the Billion Code community, I will put a link in the comments. Thanks for being here this morning, I look forward to seeing you again tomorrow.