Below you will find a complete listing of footnotes from Between the Lies: How to Reclaim Your Future from the Banks and Wall Street.
If you encounter a broken link, no problem! Every single reference was backed up on the Internet Archive prior to the original launch of the book.
1.1 SERENITY
1 “Hard money loans” are short-term loans from individuals or companies, typically used for real estate transactions. They generally have a high interest rate and use the purchased property as collateral.
2 Reading list and other free resources available at: https://perfectspiralcapital.com/BTL
1.3 THE TRUTH BEHIND ADVERTISEMENT
3 Jon Schwarz, “Inflation Is Good for You,” The Intercept, November 10, 2021, https://theintercept.com/2021/11/10/inflation-economy-debt-milk-prices/
4 Encyclopedia.com, “World War II and the Ending of the Depression,” https://www.encyclopedia.com/economics/encyclopedias-almanacs-transcripts-and-maps/world-war-ii-and-endingdepression
5 Erin Lowry, “Thought you didn’t need a credit score? Here are 4 reasons why you’re wrong,” USA Today, February 2, 2020, https://www.usatoday.com/story/money/columnist/2020/02/04/credit-score-4-reasons-why-you-need-one/4500188002/
6 FRED, “Consumer Price Index for All Urban Consumers: Medical Care in U.S. City Average (CPIMEDSL),” https://fred.stlouisfed.org/series/CPIMEDSL#0
7 Consider the following information from 2020 Census Bureau data: The median income of individuals aged 65 and older is only $46,360. That means half of that population (around 35.7 million people) makes less than that—those people are not exactly retiring rich! Statistics available here: https://www.census.gov/library/publications/2021/demo/p60-273.html
1.5 WHO DETERMINES OUR THOUGHTS?
8 Nick Pecone, “The Reticular Activating System: The Secret Behind the ‘The Secret’,” Perfect Spiral Capital, https://perfectspiralcapital.com/blog/the-reticular-activating-system-the-secret-behind-the-secret/
9 The common family road trip game “slug bug,” (also known as punch buggy) is a common example of priming your RAS to seek out a particular model of car.
2.1 WHAT DO BANKS DO?
10 Matthew Butterman, “How to Start a Bank: The Complete 7 Step Guide,” Upflip, 2020, https://www.upflip.com/blog/how-to-start-a-bank
11 The actual interchange fee formula is a little more complicated than a flat percentage. Examples of current rates from major credit card networks may be found here: https://www.valuepenguin.com/credit-card-processing/interchange-fees
12 Louis DeNicola, “How do banks make money?” Credit Karma, Updated October 12, 2021, https://www.creditkarma.com/money/i/how-do-banks-make-money
2.2 “BUY NOW, PAY LATER” BY THE NUMBERS
13 A simple tool to calculate auto loans with amortization: https://www.amortization-calc.com/auto-car-loan-calculator/
14 National Association of Realtors, “2021 Highlights from the Profile of Home Buyers and Sellers,” November 11, 2021, https://cdn.nar.realtor/sites/default/files/documents/2021-highlights-from-the-profile-of-home-buyers-and-sellers-11-11-2021.pdf
15 A simple tool to calculate mortgage loans with amortization: https://www.amortization-calc.com/mortgage-calculator/
2.3 FRACTIONAL RESERVE BANKING
16 This will be simplified somewhat, but please see the recommended reading list on the book’s resource page if you wish to understand every aspect of this process: perfectspiralcapital.com/BTL/
17 So that the interest can be easily seen for each stage, this example uses a deferred payment loan rather than a typical amortization. Each loan assumes 10% interest due at maturity, one year after the loan is taken. In other words, the interest is exactly 10% of the original loan.
18 Federal Deposit Insurance Corporation, “BankFind Suite,” https://banks.data.fdic.gov/bankfind-suite/bankfind
19 An excellent analysis of this process is available on pages 162-168 of “How Privatized Banking Really Works,” by L. Carlos Lara and Robert P. Murphy, Ph.D.
20 Board of Governors of the Federal Reserve System, “Federal Reserve Actions to Support the Flow of Credit to Households and Businesses,” March 15, 2020, https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm
21 Bill Ganzel, “Bank Failures,” Wessels Living History Farm, 2003, https://livinghistoryfarm.org/farminginthe30s/money_08.html
22 Journal of Accountancy, “FDIC Insurance Fund Falls to Negative Balance,” December 20, 2009, https://www.journalofaccountancy.com/news/2009/dec/20092432.html
2.4 2020
23 Ben Popken, “2020 was the year the jobs went away. But when will they come back?,” NBC News, December 17, 2020, https://www.nbcnews.com/business/economy/2020-was-year-jobs-went-away-when-will-theycome-n1251505
24 Ty Haqqi, “10 Most Profitable Companies in America in 2020,” Yahoo! Finance, August 3, 2020, https://finance.yahoo.com/news/10-most-profitable-companies-america-215951022.html
25 Christian Kreznar, “Small Businesses Are Closing At A Rapid Pace, With Restaurants And Retailers On The West Coast Among The Hardest Hit,” Forbes, September 16, 2020, https://www.forbes.com/sites/christiankreznar/2020/09/16/small-businesses-are-closing-at-a-rapid-pace-withrestaurants-and-retailers-on-the-west-coast-among-the-hardest-hit/
26 Alia Wong, “Pandemic babies are behind after years of stress, isolation affected brain development,” USA TODAY, June 9, 2022, https://www.usatoday.com/in-depth/news/education/2022/06/09/pandemic-babies-nowtoddlers-delayed-development-heres-why/9660318002/
27 Brianna Ehley, “CDC: One quarter of young adults contemplated suicide during pandemic,” Politico, September 13, 2020, https://www.politico.com/news/2020/08/13/cdc-mental-health-pandemic-394832
2.5 INFLATION
28 David H. Friedman, “I Bet You Thought…” Federal Reserve Bank of New York, New York, December, 1977, https://files.eric.ed.gov/fulltext/ED175743.pdf
29 A simple way to visualize the decrease in buying power of your money over time is to use the Consumer Price Index tools and graphs, here: https://www.officialdata.org/1789-dollars-in-1913
2.6 THE FEDERAL RESERVE
30 Federal Reserve Bank of St. Louis, “In Plain English – Making Sense of the Federal Reserve,” https://www.stlouisfed.org/in-plain-english/the-fedand-the-dual-mandate
31 For more detail on this process, it is useful to consult “The Case Against the Fed,” by Murray N. Rothbard. (1994) https://mises.org/library/caseagainst-fed-0
32 Scott Pelley, “Coronavirus and the economy: Best and worst-case scenarios from Minneapolis Fed president,” CBS News, March 22, 2020, https://www.cbsnews.com/news/coronavirus-and-economy-best-and-worst-case-scenarios-60-minutes-2020-03-22/
2.7 THE GOLD STANDARD
33 For a thorough examination of the history of the gold standard and its relationship to the Federal Reserve and central banking in general, please consult “What Has Government Done to Our Money?” by Murray N. Rothbard. (1963) https://mises.org/library/what-has-government-done-our-money
2.8 THE DODD-FRANK ACT
34 Congress.gov, “H.R. 4173 – Dodd-Frank Wall Street Reform and Consumer Protection Act,” https://www.congress.gov/bill/111th-congress/housebill/4173/all-actions?overview=closed#tabs
35 Toby Baxendale, “What Is The Legal Relationship Between The Banker And His Customer?,” The Cobden Centre, September 14, 2010, http://www.cobdencentre.org/2010/09/the-legal-relationship-between-the-bankerand-his-customer/
36 Nathan Lewis, “The Cyprus Bank ‘Bail-In’ Is Another Crony Bankster Scam,” Forbes, May 3, 2013, https://www.forbes.com/sites/nathanlewis/2013/05/03/the-cyprus-bank-bail-in-is-another-crony-bankster-scam/
37 L. Carlos Lara, “From Bailouts to Bail-Ins: Understanding the Dodd-Frank Act,” Nelson Nash Institute, https://infinitebanking.org/banknotes/frombailouts-to-bail-ins-understanding-the-dodd-frank-act/
2.9 CASH IS KING
38 Investopedia, “A Review of Past Recessions,” Updated June 16, 2022, https://www.investopedia.com/articles/economics/08/past-recessions.asp#toc-the-mash-recession-july-1953may-1954
39 While this is debated, I am following the historically accepted definition of “recession,” as seen in this 2009 document from the International Monetary Fund: https://www.imf.org/external/pubs/ft/fandd/2009/03/pdf/basics.pdf
40 Cision PR Newswire, “Bank of America Introduces Community Affordable Loan Solution™ to Expand Homeownership Opportunities in Black/African American and Hispanic-Latino Communities,” August 30, 2022, https://www.prnewswire.com/news-releases/bank-of-america-introduces-community-affordable-loan-solution-toexpand-homeownership-opportunities-in-blackafrican-american-and-hispanic-latino-communities-301614686.html
2.12 COMPOUND ANNUAL GROWTH RATE
41 An online calculator for Compound Annual Growth Rate may be found here: https://www.omnicalculator.com/finance/cagr
3.3 HOW IS THIS SUPPOSED TO WORK, ANYWAY?
42 PBS Frontline, “Can You Afford to Retire?” February 7, 2006, https://www.pbs.org/wgbh/pages/frontline/retirement/interviews/bogle.html
43 Investment Company Institute, “2021 Investment Company Fact Book,” https://www.ici.org/system/files/2021- 05/2021_factbook.pdf (New link here.)
44 Andy Tanner, 401(k)aos: How Our Dream of Retirement Became a Nightmare of Chaos (Tanner Training LLC, 2012), 123
3.4 SAVING VS. INVESTING
45 Reading list and other free resources available at: https://perfectspiralcapital.com/BTL
46 Social Security Administration, “Starting Your Retirement Benefits Early,” https://www.ssa.gov/benefits/retirement/planner/agereduction.html
47 This tool allows for custom date ranges. Try Looking at various time periods, such as 1789-1913, 1635-today, 1913- 1929, 1990-today, etc. https://www.officialdata.org/1789-dollars-in-1913
48 Fifty Thirty Twenty, “Income + Financial Stability in America,” http://fiftythirtytwenty.com/
3.5 RELYING ON WALL STREET FOR RETIREMENT
49 As an example, consider this Nerdwallet article from August 4, 2022. It simultaneously claims that “the average stock market return is about 10% per year for nearly the last century,” and “…if you’re estimating how much your stock-market investment will return over time, we suggest using an average annual return of 6%.” https://www.nerdwallet.com/article/investing/average-stock-market-return
50 Caroline Valetkevitch, “Key dates and milestones in the S&P 500’s history,” Reuters, May 6, 2013, https://www.reuters.com/article/us-usa-stockssp-timeline-idUSBRE9450WL20130506
51 The average expense ratio for your retirement account is very likely to be lower or higher. This depends on the size of the company offering the plan, the individual expense ratios of the funds themselves, and potentially how much the advisor who set up the plan earns on an ongoing basis, as illustrated by a previous example.
52 In this analysis, the entire distribution is reduced by 24%. This assumes that these are the last dollars earned by an individual who is already in the 24% tax bracket. If this was the only income being earned, then the entire progressive tax structure at that time would need to be considered.
53 For example, the “Investment Calculator” on SmartAsset: https://smartasset.com/investing/investment-calculator
5.1 THE 10-YEAR OVERNIGHT SUCCESS
54 Chris Taylor, “70% of Rich Families Lose Their Wealth by the Second Generation,” Money, June 17, 2015, https://money.com/rich-familieslose-wealth/
6.1 SQUARING THE CIRCLE
55 Ramsey Solutions, “The 7 Baby Steps,” https://www.ramseysolutions.com/dave-ramsey-7-baby-steps
6.4 TERM LIFE AND WHOLE LIFE
56 $200 x 20 years x 990 people = $3,960,000.
57 Other types of life insurance certainly exist: Universal Life (UL) and its permutations such as Variable Universal Life and Indexed Universal Life (IUL), various simplified issue and guaranteed issue policies, group insurance, mortgage protection insurance, life insurance policies that are combined with long-term care insurance coverage, etc. There are even multiple types of term and whole life insurance, as well as different types of companies! This has been simplified to focus on key aspects.
6.5 LIFE INSURANCE YOU DON’T HAVE TO DIE TO USE
58 Hohn, Harry G., and Emil J. Molin. “LIFE INSURANCE POLICY LOANS: THE CONTRACTUAL RIGHT, ECONOMIC IMPLICATIONS AND LONG-TERM SOLUTIONS.” The Forum (Section of Insurance, Negligence and Compensation Law, American Bar Association) 16, no. 4 (1981): 692. http://www.jstor.org/stable/25762549
6.6 TRUE UNINTERRUPTED COMPOUNDING
59 Different insurance companies have different types of PUA riders for their policies. Some may require PUA payments on the policy anniversary date, while others allow for unscheduled payments throughout the year. Some require the payment to be the same amount each time, while others allow flexibility with each payment.
60 Note that this only applies to certain companies, known as “non-direct recognition” insurers. They do not recognize the fact that you have a policy loan out when they make dividend payments. “Direct recognition” companies, on the other hand, do recognize any outstanding policy loans. All direct recognition companies pay less in dividends if a loan is out. Some pay only marginally less, but some pay no dividends at all to policy owners with loans. Correctly understanding and navigating this landscape is a responsibility that Perfect Spiral Capital takes very seriously.
61 NFP and Michael White Associates, “BOLI Assets Grew 3.1% to $180.5 Billion as of June 30, 2020,” https://executivebenefits.nfp.com/images/PDFs/boli-holdings-reports/Q2-2020-BOLI-Holdings-Report.pdf
62 Federal Deposit Insurance Corporation, “BankFind Suite,” https://banks.data.fdic.gov/bankfind-suite/bankfind
63 Richard Koch, “How Walt Disney Funded His Dream,” Huffpost, December 19, 2017, https://www.huffpost.com/entry/how-walt-disney-funded-his-dream_b_5a38ebc1e4b0578d1beb72a1
7.1 PAYING INTEREST TO YOURSELF
64 Note that the policy loan does have an interest rate and the Andersons do owe interest to the insurance company. In this example, that rate is 5%. However, the loan is not amortized like a traditional mortgage. Amortizing $394,761 like a traditional mortgage means $762,898 in payments over 30 years. Instead, a policy loan starts at the amount loaned, and accrues interest daily.
8.3 THE GOOD GETS BETTER
65 Income and expense figures taken from a CBRE report on Self Storage facilities across the US from Q1 2018: https://www.cbre.us/-/media/cbre/countryunitedstates/media/files/services/self%20storage/cbre-self-storage-operatingexpense-report—-1q_2018.pdf