Ponzi Factor radio interview with Loiue B Free

And I, as I had promised, a very, very special guest on to talk about something that will, it's going to, I guess, to taught it, which I say, rock their worlds, right? It's gonna rock your world. He's gonna, it's a preconceived notions that you have, things that you think you know about the stock market. Wow, this is gonna be—let me just say, it'll blow your mind.

So, The Ponzi Factor is the name of the book, The Simple Truth About Investment Profits, and I'm telling you, I'm honored to have you on the Louie Be Free Radio Show. Good morning to you!

Good morning!

I think that monitor. Tell us about yourself before we get into the book.

Sure. I basically graduated from a university with an economics and finance degree. I worked in two hedge funds and managed distressed assets for a bank for about ten years in finance and left the industry in 2015 to basically publish this book. But at the same time, during that ten years, what I realized was the finance system itself is pretty much one big scam. So that's kind of my background.

Again, that's pretty horrifying for people to hear. But, me, and I want to—I want to get into that—but before we do, about that path for you, if you don't mind.

Sure. So, this book I published earlier this year in 2018, but really it was a project that started back in 2012. What really made me aspire to put this out there was after I saw one of my hedge funds. It was the second hedge fund I worked for, and I saw how in 2008 they were basically doing something a lot of financial strategies do, where any financial strategy can just put it this way: any financial strategies that involve some kind of synthetic assets, as in it can be a credit default swap, it could be a life insurance policy (in their case), or it could be a stock that really has no intrinsic value—almost always the profits that people experience come from other investors that are pouring money into the same scheme, which means the money doesn't actually appear from anywhere. It always, almost always, comes from other investors pouring money into the scheme.

And this is exactly how the stock market works. When people buy a stock for ten dollars and they sell for eleven, that money doesn't come from the company that supposedly made money or didn't make money in Tesla's case. It always comes from another investor who is pouring money into the system. And that, by definition, of course, is a Ponzi scheme.

What I saw this fund do in 2009 was pretty much that. They were marking up assets to unrealistic values that they were never really selling for. And when they didn't sell it for the values that they thought it would sell for, they just ended up buying back their own policies with other investors' money. This is something like a story I described in detail in Chapter One of the book, and it really just opened my eyes to how shady the entire finance industry is.

And it's very important to point out that what that fund did and what I saw, you know, everything I talked about in the book is legal. They're not illegal, like Madoff, they're illegal. And that's the really scary part. What Madoff did is nothing compared to what these companies are doing right now every single day, we like to say.

That's one of the four alarming aspects of it—that it is legal. People didn't—you know, the way you talk about this—I mean, the way you write about it in The Ponzi Factor is very, very frightening, I guess I should say, for people, right? I mean, frightening that people don't know this yet.

People will say, and I'm already getting some early messages, "But I've made money in the market, Louie!" Well, they're telling me—they're saying it to me. How do you know? Of course, I'm sure I'll hear from some people who may have lost plenty of money in the market also.

But yeah, how do you—by far, Mal Gambetta investigated—when his whole thing blew up and stuff, investigators found that more than half of his accounts actually showed a profit. The total money lost, of course, was greater, but as far as his accounts go, they actually showed more than actually show a profit.

Let me give you a simple example, right? If you get—if somebody—a company issues a stock and the person who buys that, let's say for a dollar, that person could sell that stock to another person for $2, another person for $3, and just keep going for up to $100. And you'll have 99 people that make a dollar along the way, okay?

Yeah, problem—however, the problem is you're left with a guy at the end of the road who is down a hundred dollars, right? That person wants his money back still. So, the whole system is actually negative sum. You can include the fact that there are transaction fees in between. Even though you saw 99 people make a dollar off of every transaction, a nice upward sloping curve, okay? Except for there's that one holding a piece of paper that he wants money for. And the only foreseeable way he's going to get that money is by selling it to another investor. Now, I will address my critics real quick, because I already know what they're thinking—hypothetically speaking, alright, a company could buy back stock. Hypothetically speaking, a company could pay dividends.

But on a very foreseeable basis, on a very observable basis, that actually doesn't happen. So, you got this situation where people can make money along the way, but at the end of the day, the problem is—the people who are holding stocks right now actually have zero dollars. What they're holding is a note with an abstraction, a number attached to it.

And the only foreseeable way that they can really get money for their stock is by selling it to another investor. At the moment, I will let—there's a number of places I want to go, and I just, because I think this is so important, I think the book is so important for people to understand the simple truths about investment profits.

The Ponzi Factor, of course, is available everywhere online. Again, I'm speaking with the author. My guest is Tong Lu, and again, the book is available everywhere. It's theponzifactor.com. We've got links up to theponzifactor.com.

When you write initially in the book, I mean, the most dangerous ideas are those that are true. And that other quote that you have, I love this: "All truth passes through three stages. First, it is fuel; second, it is violently opposed; third, it is accepted as self-evident." I mean, it's really, really fascinating when you think about some of what is going on.

But tell me again, when you first got to the point where—I don’t know what—how do I want to say it—an aha moment where you realized exactly what was going on.

Okay, so the aha moment, right? Funny thing is there, when I first realized that the stock market was a Ponzi scheme, is of course when I realized, "Wait a second, when that stock gets sold to somebody else, basically, if I buy some stock, or profit in capital gains, that comes from somebody else." It was not really—of course, it was an aha moment when I realized that I was in denial.

I was in denial. I used to say the same things to defend the stock market, just like my critics were probably criticizing me when they hear me talk about it being a Ponzi scheme. None of my critics have ever really read the book; they just criticize me. I'm sure because they saw two minutes worth of a trailing outline that they think I uncover anything under the sun, but basically denial, really—and it was more of a stages where I realized that, and then over a period of months, I started to just accept it more and more, only because you keep seeing these actions in the market.

You keep seeing people on CNBC like Jim Cramer explain why Tesla stocks, like Tesla, which can skyrocket from $22 to $380, while they'll come to losers, $4.7 billion, right? Make up these ludicrous excuses on how that can happen, okay? When you specifically know why. It's because the stock has nothing to do with the underlying company. It is totally monetarily disconnected from the underlying company, and the valuation of the stock is coming from inflow of cash from new investors—the Ponzi factor.

And so, over time, it just becomes more and more clear. It's not something that was like I even wanted to accept at first, but over time it just becomes impossible to deny. And it's just when you know the truth, when you see the truth, and you watch all these ludicrous finance analysts say their spiel on CNBC, or even academics go on CNBC and Bloomberg, and say their spiel, and it makes sense—and what they're saying is totally improvable, totally hypothetical—and they're simply avoiding the very, very simple truth that I described in this book, which is provable, which is also falsifiable.

Okay? Which basically makes it a legitimate idea—original ideas are those that you cannot prove right or wrong. And that is what binds people. If you listen to CNBC, you listen to these analysts, you will—everything they say, you can’t exactly prove it wrong, but you can’t prove it right either. And you know what Karl Popper, the philosopher, calls that? He calls that a pseudoscience idea—a pseudoscience idea that is completely worthless. And that is exactly what these so-called people are talking about every single day on CNBC versus the simple truth of what I realized that—it’s an aha moment—it seemed quiet at the moment, but over time it just became so evident, so clear that you can't forget about it.

I got to ask, and I hope you don’t mind me asking you this. I’m sure you've thought about it, being the guy that, you know, the nail that sticks up gets hammered down. The guy that brings these out—you got to be getting hammered or dismissed, yes, as we were talking about.

What are your thoughts on that?

I expect it. I expected it. But at the same time, my critics have absolutely no valid argument against what I'm saying. I mean, ultimately, yeah, it's kind of like, yeah, I get hammered here and there, but it's fine, though, because it'll include as well finance people, especially my critics, are very predictable, alright? I mean, I don't care if I'm having a conversation with some random person online or maybe somebody from the SEC or somebody from some big corporation. I know what they're thinking and what they're gonna say, replying to counter with five steps deeper than they can ever imagine.

So in a way, their arguments are actually very predictable, and I know how to address all of them. A very fundamental first argument they always come out with is: "Well, stocks are equity ownership instruments." And the reality is they're not. And I explain that in Chapter One—because for most stocks, you never get dividends, meaning there's no monetary connection. So there’s no real ownership instrument there. Stocks are just labels.

So when they hammer me and when they attack me, I know how to express all their arguments. And right now, like I said, it's the number one argument they have—or the number one style of argument they have—or they’re bringing up hypothetical ideas like, "Oh, Google could pay dividends," "That's a good buy back stock," "Tesla could make money down the road." And you know, I just say something very simple: "Well, those are hypothetical situations. What I'm describing, the Ponzi factor, people exchanging money, this is an observable one. You want to play in my world, you want to bait me? Explain it with observable facts! Explain what's something we can actually see, not these hypothetical ideas of how Berkshire Hathaway could start buying back their own stocks."

And at that point, they become silent, because they might someday, who knows when? Maybe, if—you know, like I hate to say it. I mean, not like playing the lottery, but thinking, "Well, I could win the lottery." They might—and you know, "I might win the lottery," but let's get real.

I’d like to talk a little bit, if you don't mind, about Tesla that you talk about.

Sure! I got nothing against Tesla or Elon, except for now the more I'm researching the guy, he’s more of a scumbag, and I saw it—but nonetheless, Tesla was basically a prime example of this cosmic cancer because this is a company that made no money.

In fact, since they've been public, they've lost $4.7 billion. And during this time, their stocks ascended from $20 to $380. And of course, the animal question I want to propose to people is: How can that logically happen, right? As in, if stocks are a real ownership instrument, how on earth can investors who own this company that loses $4.7 billion—how can they make out like bandits?

And Jim Cramer’s logic and reasoning is, “It’s a cult,” because apparently, you know, the SEC started registering cults; I missed that memo. But yeah, okay, Jim, sure! My explanation is quite simple: it's that Tesla stocks, like all stocks, are not connected to the company, and it's not a real ownership instrument.

And the reason why their stocks can be fit up to $380 while the company loses $4.7 billion is because that money doesn't come from the company; it comes from other investors. So, Tesla just happened to be a picture-perfect example of this.

Now, on the other hand, Google is also a decent example of this. Google made money because I point out that Google, between 2007 and 2011, made $28 billion. But if you owned Google stocks, you wouldn't make anything because the stocks stayed relatively flat during that period, and Google doesn’t pay dividends.

And it's not that I'm trying to cherry-pick dates or anything else. If I wanted to cherry-pick dates, I’d just show people when they would have owned the stock and lost money while Google made billions and billions of dollars. It’s simply a simple example to show that guess what? Stocks are not real ownership instruments because if you own a company, you should get some of the profits. And clearly all these examples are literal market where that stock price is completely disconnected from the company.

And again, when you talk about the Ponzi factor, ThePonziFactor.com— again, one of the biggest myths about stocks is the belief that profits from stocks come from the earnings of the underlying companies. When companies make money, they share the profits with their investors.

Again, what you're writing about is that couldn’t be further from—I shouldn't say further from the truth. Correct, Todd?

Correct, yeah.

Yeah, it is very, very true. And Ponzi—again, when you—the issue with the Ponzi—again, you talk about it. But the way you present it and then say that everything is legal, and of course, you're talking about Bernie Madoff, and I think most of us know the Bernie Madoff thing.

And again, you know, I argued with—well, not argue—discuss with people, and I don't know—again, it's horrific when we see the shows. You see people who lost everything, and had their life, and you know, just destroyed, economically destroyed. But maybe initially thought, “Well, I'll be able to, at some point, I'll be able to pay them back.”

And you know, a lot of people, you know, it gets to be bad thinking. But what you're saying is this is the market. This isn’t bad thinking; this is the stock market. Am I making any sense?

Yeah, I mean, it's the stock market. The issue I have with the whole system, right, is not that—look, if people want to gamble on this imaginary paper that’s really worth nothing, because the holder of the paper, the stock, right? I mean, the stock’s not backed by anything. Okay? Tesla stocks, Google stocks, they're not backed by anything. I mean, if the person receives no money and then these companies back up the value of their stock—if people just want to go out there and play and gamble on the stock and say, "Okay, well, you know, I'll just, I'm gonna gamble on the fact that I could sell to another person that wants to give me more money," right? I'm totally cool with that.

I mean, I'm fine that—that’s what people want to do. The problem is it’s sold to people as investment instruments, not as gambling instruments. You could be eighteen and buy this garbage, but you’ve got to be 21 to play blackjack.

Those are the other people as investment instruments, and it’s sold to people as some— a piece of a company, when it’s really not a piece of a company—and that’s the real issue I have with this whole thing.

What's the difference between Madoff and Google stock?

Madoff technically traded nothing, okay?

Now, Google stocks—okay, it's equivalent to—look at their C shares which make up half their market cap. They have two types: Class A and Class C. The Class C shares—none of their stocks pay dividends and all, but their Class C shares don't even have voting rights.

So, if you have this thing, you receive no money from Google; you're not allowed to vote on anything. Google doesn't back up the value of that thing at all. So, what the heck are you playing with out there? I mean, what the heck is supposedly worth $1,200 that people are trading right now? It’s an imaginary Google sticker, that’s it.

And I mean, what's the difference? Admittedly, Madoff—well, I guess you could say there is a Google sticker involved.

It’s not funny, the way you say it, but it's how do I want to say it? It’s fun, but it’s really not. It's pretty horrifying, right? It’s pretty horrifying. But I mean, it is—I think of your own Google stocks, I think, “Yes.”

So, yeah. I mean, it’s unfortunate, but that’s it—that is kind of how the system works. And I laugh when these companies report. I mean, where are these news shows talk about how Google is almost worth a trillion dollars or something like that?

The math formulas completely maximize failures in finance and these ideas they have are nothing short of ridiculous. Whatever your research papers in textbooks— I write “LOL” next to some of the lines, okay, as notes, because I just want to highlight how ridiculous it is. I mean, this whole idea of market cap, for example, it’s based on a price times the number of shares, okay?

So, if Google stocks are trading at $1,200, let’s say on Friday, then that price is going to be applied to 348 million shares of their C shares, okay? Now, I point that out because here’s the problem: that $1,200 price was achieved with a volume of 1.5 million shares on Friday, alright? And you're applying that same price to 348 million shares even though half a percent of those shares were actually traded, alright?

If I go to the market and buy one stock for $1,203, alright, that’s $1,203. That price will be multiplied by 348 million—basically, their valuation would go up, their market cap will go up by $1 billion because I introduced $3 into the system.

Okay? So that gives you an example of just how messed up these formulas are. And I guess it’s also a little scary, because in the sense out of you, if somebody actually has, let's say, $30,000 of stocks in their portfolio, what they don’t realize the most part is that they actually have zero dollars! The moment you buy stock, your money is gone.

That’s it! And, and the reality is—they are not entitled to that $30,000. They can’t just simply—the idea that they can just simply redeem it in the market whenever they want is actually not true because everyone holding that has the same idea.

And like I said, on Friday, every single day, only about like 1% of the actually outstanding shares are traded or something like that. So when you bring—again, bringing this forward, at what point do you mind? Are you good time-wise?

Time? Yeah, I'm good.

Yeah?

Yeah!

And I know it's bright and early for you, and I appreciate you doing this very much. Well, it's—you know, people have to have responsibility, and you can't be—you can't make responsible decisions unless you have information.

And again, I'm not a far be it for me giving anybody any financial advice. I’m not—nobody gives financial advice for me, but you've got to be at least aware. It doesn’t mean that people shouldn’t do what they decide to do. You know, people decide to invest in the stock market.

Again, I’m loaded with people that are telling me that they made money in the market, they made money in the market. Yeah, I should say this but, you know, as my wife always says, "My greatest asset is my greatest liability." There’s no filter between my brain and my mouth, so I am gonna say I knew a guy that knew a lot about horse racing, and I’m opposed to horse racing; I’m an animal rights guy.

But anyhow, what do you say? He said, "Don't ever believe that, Louie! Don’t ever believe these guys that say how much they win on the track because what they're not telling you is they're not bottom-lining that. They're not telling you the races they lost and what the net profit or loss is." Something, something he used to say. Something like that.

Even much better way of saying it. And that's kind of—I guess I’m not saying it’s kind of like this. Yes, there are people that have made great money in the market. Yeah, there are people that have 401Ks that are selling. But you need to know the reality of it, correct?

I mean, there are people on Ponzi schemes. There are a lot of people who have made money in Ponzi schemes, that's correct.

Yes! So here's the problem with a lot of people who may be saying that they've made money, okay? If they're holding stocks, they haven't made money, okay? They're holding nothing, actually. If they're holding stocks, this idea that a lot of people cause, "Yeah, well, my portfolio is doing great," well, really, your portfolio?

Yeah, in play! Well, okay, that's not real money! That is not real money at all! That is an abstraction! That number comes from the exchange of money! It is fundamental—from money itself that you can possess. You can't race and you hide under your mattress and you can spend!

Well, this is a pretty clear way to see it, I think, for some people right now. The stock market value, the NYSE, and the NASDAQ, it has a total value of like thirty-one trillion dollars or something like that.

But there’s only one point six trillion dollars of real money in circulation in the entire U.S. economy, alright? And also, if we look at the most lenient form of measurement of money, which is the M2—that also includes bank notes aside from hard currency—because we have a fractional reserve system, that total is only around thirteen trillion dollars.

And most of that is not even available for the stock market. So, right there we see that people who are holding stocks think they're entitled to thirty-one trillion dollars because that is the market cap—that comprises the sum of 401Ks—that is some of people who must see the dollar values in their stock accounts.

However, they’re entitled to that. Why? Because that kind of money doesn’t exist! So, I mean, right there, if they think they’re making money and it’s actually in stocks, they have not received money yet, and the fact that they think they can cash out tomorrow and just make money, that is not a fact. That is actually a massive assumption that is built on two assumptions.

One, somebody is there to buy for the price that they see it at, because the price that they see it at now is based on the last transaction, not the next transaction.

Second assumption—assuming that assumption is met—second assumption is that no one else has the same idea of selling it. So they are also the only ones in the market who wants to sell at that price.

And of course, I'm not saying that they can't sell it, okay? What I am pointing out is that this idea, "I can just sell it tomorrow and get my money back," is actually based on two assumptions. And of course, even if they can get their money back, right? And where's that money coming from? Another investor, just like how it works in a Ponzi scheme.

Again, not—nada. I hate to say, you know, because when you were talking about Bernie Madoff earlier, the—again, we all seem to know about him, you know, because it was so high profile. Because so many people's lives were, I hate to say, destroyed—but their financial lives certainly were in that process that built up.

And I’m sure there are many stocks that that has happened with people, but the difference is they may not have put their life savings in. Am I making any sense on you?

Yeah, yeah, you are.

I mean, here's the thing I want to also mention is really we have no idea how much money people have lost on the stock market. No idea! As in we don't have a database that keeps track of investor losses.

This was actually one very important fact I realized in my research is that nobody actually knows how much money people have made in losses.

And people just simply go on this assumption that people have made money because they see that the market cap, the thirty-one million dollar thing, grow and grow.

I hate the light, but again, they’re mistaking that for real money! We’re not talking—I’m not talking about just amateurs mistaking it. I’m talking university professors who write textbooks. They mistaken it!

I've heard a guy from the University of Chicago on his lectures online—University of Chicago, one of the best schools out there. Okay? The science guy basically keeps talking about the stock market value as if you have real money. It is fundamentally wrong because, look, I teach finance at one of the top universities, and it is fundamentally wrong!

I think he just simply doesn't even understand this very basic thing. So, it's a kind of like—we don't even know how many people made or lost money. And you talk about Madoff. That’s one scheme that’s wrapped up, and we’re getting an idea of how many people lost money.

More lost, of course, lost more than one as far as total dollar goes, but then I go back to what the investigators found at the very beginning, is actually still what is showing now, which then most of his accounts actually showed a profit.

The Ponzi Factor is the name of the book, The Simple Truth About Investment Profits. ThePonziFactor.com is the website, ThePonziFactor.com. Obviously, links up at Lui Free Show, etc.

When you, your hope—I should ask you, you know, when you finished writing the book and actually handed it over to be published, your hope is—what?

My hope is—I'm still trying to understand what my end goal is right now. Really what I wanted to just tell people the truth and expose the, you know, the scam for what it is. But I guess one way to put it, what I really wanted—I hope to bring about meaningful change. Meaningful change. Not just some garbage change or temporary change, but just really meaningful change.

Because the things I explained in my book, they’re fundamental. And they affect stock market crashes from whatever sense of the 1920s to—and also future crashes that we’ll see down the road because I’m expressing a fundamental idea that applies to just simply how the valuation of the stock and, now mechanics of how people are actually making money when they buy and sell stock.

And I hope to bring meaningful change through this. I don't know exactly how that’s gonna happen yet, but I think the first step is to just inform people of the truth. And then when we—when we're all aware of the problems and how this whole thing works, then we'll figure—we'll move towards a solution together!

Again, that’s the least we can do is make sure that people know the truth about it. Again, you know, you’re talking—we hear every once in a while about cleaning up Wall Street and we hear that, but it doesn’t seem to be that that ever really happens, correct?

Yeah, you know more about it than—obviously, I'm a lot more about it than I do. But we hear the words; the words always sound good over a forum. They say, you know, we hear those words, but—is it ever?

Yeah! It happens!

Yeah, it's tough because Wall Street, they have a way of getting away with stuff. I'm hoping to, with this book, because I explain something in such simple and obvious ways that we can bring about change—not with complex regulations or anything like that, but just with simple ones.

Like let’s get a database that tracks investor losses, right? Let’s classify stocks as gambling instruments because it doesn’t make any sense why 18-year-old kids can open online trading accounts and have to wait until they're 21 to go to a casino.

And let’s just bring about those simple ideas and those simple things to bring about simple change to really change Wall Street. It’s fine because the idea of “Let’s start a database that tracks investor losses”, right?

And wins, and wins. It basically tracks the wins and losses. Now, I personally can’t think of a reason why anyone would be against it, alright? But I’m pretty sure Wall Street would do everything they can to stop it because they know at the moment that we have a database that actually tracks the real cash winnings and losses of investors, it’s basically at the beginning of the end for them.

Because when people see that people are not making money in this negative sum system, then that’s just bankruptcy for them, right?

So again, for something—doing something like this and hoping we—I guess, how do I want to say it?

You talk about something to track losses. Getting, you know, Wall Street getting government oversight—government regulation to do that, it's gonna have to be an enough outrage, correct? Enough outcry?

Some guts!

I don't know! I can't imagine either party leading this; I mean, I don't got either political party leading this. This is gonna have to be led by you.

I mean, [laughter] because there’s too much—again, I don’t want to get on another other issues—but there’s too much that financially incestuous relationship between government and—I don’t want—and business. You know, they’re certainly not gonna want to see that you could lose.

And again, the lottery—and I hate to keep bringing the lottery in, because it's a very different, very, very different view. But you know, you don’t hear about—they don’t show about how many tickets lose. You always, if you go in somewhere, you go to the gas station, they’ve got all the winners. This guy won $1,000 on this $10 ticket or whatever they don’t—it’s like, you could probably paper a street, street a main strip with the losing tickets, right?

Yeah! So here’s the thing, though. The lottery, it’s a well-known thing that the odds are against you. And it’s just something for people to play nonetheless, which is—I’m not sure what the age is to buy a lottery ticket. I’m not even sure! What the age is to buy a lottery ticket?

You have to be 21 because it’s not a deposit.

Something!

I mean, the issue with stocks is—it’s presented as something that you’re more likely to win on. And even though they don't know the probabilities of winning or losing a nice dog, they don't know how much money people have lost historically, so—so yeah!

It's like if you hear a lottery commercial, at least the ones I remember, it’s kind of like they have a jingle or something. It’s comical! Here’s something about investment! Merrill Lynch or something!

A mere prize!

It's not a comical! They actually—I mean—they trust show you something like a jingle going on about the difference in their commercials, right?

Well, the jingles—I mean, I dare say—and let me ask you, are you good for a couple more minutes or do you gotta split?

Yeah! I’m having a great time with you, Tong!

I would say, you know, it’s kind of like that for the drugs that—you know the drug ads, you know? They were—they—you see people walking in fields and birds around when they’re talking about all the negative possible side effects of these drugs. You could be immediate death, this could be—you know, skin cancer!

And but they’ve got two people holding hands and the butterflies and the birds are singing and—right? So it’s kind of like the stock market, the lottery, again.

Again, people need to know that the whole thing—like what I love about what you wrote, regardless of the people that, you know, or the pushback that some people are getting and getting a lot of positive, too—is I’m looking—a lot of people, you know, it’s a wake-up call! What is a real wake-up call?

I agree. At least have the knowledge going in. Know what you’re going into. Understand that—and then you know, is that—knowledge is power!

But it is at least—you know—and if you decide to gamble, if you decide to do that, then you make that decision, but know going in what’s going on! Does that make sense?

Yeah, yeah. Totally, Louie! That’s why I, literally, at the end of the day, I don’t really care if people gamble in stocks. I just want them to know the team they are getting into.

And I’ll just add right now that whoever’s listening to this, I don’t—you know, whatever their opinion of me and whatever they think of this conversation right now, I seriously encourage them to at least go to the YouTube channel and listen to the introduction for the audiobook trailer and just understand the game that they’re getting into!

Because the game is not what they think it is! I mean, there’s a lot of false information that finds people present out there. One of the biggest falsehoods I’ll just throw out there because Lincoln Springs with uppers is, um, is basically, “Oh, what about happens when a company buys back stock? Don't companies buy back billions and billions of dollars for the stocks of a year?”

And the truth is, they might actually buy back some stocks, but here’s the problem: no one pays attention to how many stocks they issued before and after those buybacks.

Okay, Google, again, is a perfect example—in 2015, they said they bought back five million shares, but if you look at their SEC filing—all my facts come from their SEC filings, by the way. I don’t go to it. I don’t look for stories on the internet, or reporters reporting random stuff. I look at their SEC filing.

If you look at Google’s SEC filings for 2016, you’ll see that the shares outstanding did not go down by five million shares. It’s like—like a [ __ ] I threw by that. It actually increased by three million shares!

So if they did buy back five million shares, somehow eight million more shares entered the market somehow.

Okay? No, the whole thing is kind of a scam! And I asked one of my friends who’s an investment banker: “Why would they do this? Why would they say they’re buying back five million and then not really buy it back?”

He said, “Oh, they did it to pump up the price of their stock.” That’s what he said, right? I mean, at the end of the day, me and him, we don’t know the definitive reason for why that happened there.

But the bottom line is very obvious: the bottom line is, their shares outstanding did not decrease by five million; it actually increased by three million. That’s the bottom line!

And the thing is, this is kind of false information, of course, about the buyback. Which, it's not totally false, right? They just simply—didn't talk about all the shares they issued before or after. But it’s always out there, finds you here on TV, you see this stuff. And S&P reports these buybacks—they don’t take into account all the other stocks that are issued right before, which is a scam, which is really, really important.

Which again, really important. And again, I’m saying knowledge is power. And I've also got a link up to the YouTube channel, also in your Facebook page because, again, people need to do it. Read it! Read it! Get the book! Read the book! Understand that!

And talk about it with people. Again, these are things that this is really—at least something important that people need to have a better understanding of.

And I am grateful that you did this, Tong. I’m grateful. And get it, but—because again, I’m gonna say, I think it takes a tremendous amount of courage—a tremendous amount of courage.

Thank you!

To do what you’ve done.

Well, thank you. And I really—I mean this from my heart. I’m sure you hear this and I—I admire your courage because, again, the old sticks up can get hammered down, you know? You end up being, you know, the guy that brought this forward.

And I know it takes—it takes great courage. But when you combine, you know, there's courage and when there's intelligence with it—when there's somebody that has been so analytical as you have, I just—I love that about you.

And again, I think it’s a vitally—I know it’s a vitally important book and people need to share the information! Get the book! Again, ThePonziFactor.com, ThePonziFactor.com would cut links separately to the free show, etc.

I hope we can catch up! I know it’s relatively new. I want to catch up with you down the road a little bit, if you don’t mind, and so let’s stay in touch!

Absolutely! Wonderful!

Yeah! You do a wonderful job! Thank you so much for being on the Louie Be Free Radio Show, brain food from the heartland. Extra time grateful for you, and I admire your courage!

Thank you!

Thanks, Tong! Let’s do it again!

Thanks!