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- Herausgeber: John Wiley & Sons
- Kategorie: Ratgeber
- Sprache: Englisch
Your financial future is too important to leave to chance. Find purpose for your money and freedom for yourself and family.
Experiencing The American Dream: How to Invest Your Time, Energy, and Money to Create an Extraordinary Life is a compelling book with clear, potentially life-altering truths about economics and investing. As you read it, you'll engage in a profound exploration of your family's financial future.
Discover what investing is, how it works, and how it can help fulfill your purpose for life. You will have the opportunity to alter your relationship to money and investing in a way that leaves you, and those you care about, powerfully pursuing your dreams.
If you're committed to creating a life of freedom for you and those you love, you can benefit from what Experiencing the American Dream has to teach you. It's a breakthrough in financial education, backed by Nobel Prize winning research, designed to provide you with the tools to cultivate your financial future.
Taking this journey will teach you as much about yourself as it will about the world of investing—don't wait. Start Experiencing the American Dream now.
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Seitenzahl: 634
Veröffentlichungsjahr: 2024
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Table of Contents
Cover
Table of Contents
Title Page
Copyright
Dedication
Author Note
Acknowledgments
Foreword
Preface: Whispers of the American Dream
Introduction: The Way Aheadintroduction
Notes
CHAPTER 1: A Whole New Way to See the World
Fighting Through Cognitive Dissonance
The Terministic Screens Through Which You See the World
Responsibility Versus Victimhood
Challenge Your Beliefs
The Quest for Knowledge
Notes
PART I: Establish What's Most Important to You
CHAPTER 2: Defining the American Dream
The Power of Capitalism and Free Markets
The Greatest Time to Be Alive
Experiencing the American Dream
Notes
CHAPTER 3: Transforming Your Relationship with Money
The No-Talk Rule
Identify Your Money Demons
How to Destroy Your Money Demons
The Fear of Not Having Enough
Money Is a Phenomenon of Language
CHAPTER 4: Create Your True Purpose
The Destructive Cycle of Wealth
What Is Purpose?
The Power of Purpose
How to Discover Your Purpose
When You Struggle to Find Purpose
Taking Action
Notes
PART II: Discover What Stands Between You and Your American Dream
CHAPTER 5: The Investing Industry Is Broken
How Wall Street Really Works
How the Experts Get It Wrong
How the Illusion Is Crafted
Is Your Manager a Bully?
The Friend Filter
The Fiduciary Standard Versus the Suitability Standard
Notes
CHAPTER 6: Understanding Yourself
You Have Less Control Than You Think
Your Brain Was Not Built for Investing Success
Fear of Missing Out
Story Is Not Science
Notes
CHAPTER 7: What You Think You Know Might Not Be So
Pick Any Three Stocks
How Much Have You Saved for Retirement?
What's Your Average Return?
Is Your Portfolio Toxic?
Notes
CHAPTER 8: The Five Discoveries
Discovery One
Discovery Two
Discovery Three
Discovery Four
Discovery Five
Notes
PART III: Making Your American Dream a Reality
CHAPTER 9: Establish Your Future View
Investor Prediction Syndrome
Intentional Investing
Past-Based Versus Future-Based Language
Creating Your Future View
Notes
CHAPTER 10: Empirically Tested Academic Investing Principles
Understanding the Market
Efficient Market Hypothesis
The Three-Factor Model
Yeah, But …
Note
CHAPTER 11: Diversifying with Modern Portfolio Theory
Understanding Risk and Return
The Importance of International Diversification
The Role of Fixed Income
Rebalancing and Discipline
The Seven Declarations
Notes
CHAPTER 12: Where You Are, Where You Want to Be, and How to Get There
The 20 Must-Answer Questions
Go It Alone and Do It Yourself
Work with a Financial Advisor
Work with an Advisor Who Is Also a Coach
The Strategies for Living an Extraordinary Life
The American Dream Is Eternal
Notes
Conclusion: It Won't Get Any Easier
Epilogue
Appendix I: My Vision Statement
Conceptual Framework for New Space in the Big AZ
Appendix II: Disclosures
Factor Model
Efficient Market Hypothesis
Modern Portfolio Theory
Historical Performance of Indices
Appendix III: Index Descriptions
Note
Index
End User License Agreement
List of Tables
Chapter 2
Table 2.1 2023 Index of Economic Freedom Rank (1–176)
Chapter 7
Table 7.1 10-Year Average Return of Five Large and Popular Stocks Versus th...
Table 7.2 Three-Year Average Return for Five Large and Popular Stocks Versu...
List of Illustrations
Chapter 1
Figure 1.1 All Theoretical Knowledge
Figure 1.2 Theoretical Knowledge You Know
Figure 1.3 Theoretical Knowledge You Know You Don't Know
Figure 1.4 Theoretical Knowledge You Don't Know You Don't Know
Figure 1.5 Theoretical Knowledge You Think You Know but Is Not So
Figure 1.6 Spaced Repetition
Chapter 2
Figure 2.1 GDP per Capita Current US$ (1960–2022)
Figure 2.2 Share of the US Population in Each Income Class (1967–2022)
Chapter 5
Figure 5.1 How Often Does Harry Get It Right?
Figure 5.2 Fortune (August 14, 2000)
Figure 5.3 Fortune (July 24, 2000)
Figure 5.4
Fortune
Picks for 2021
Figure 5.5
Fortune
Picks for 2022
Chapter 7
Figure 7.1 Strong Performance Unlikely to Continue
Figure 7.2 Boeing Company Stock Performance
Chapter 8
Figure 8.1 Potential Wealth Lost
Figure 8.2 Playing the Game
Chapter 9
Figure 9.1 Two Worlds of Investing
Chapter 10
Figure 10.1 S&P 500 Index Versus One-Month T-Bills
Figure 10.2 Small Company Risk Premium
Figure 10.3 Small Risk Premium
Figure 10.4 US Small Cap (CRSP 6–10 Index) Versus US Large Stocks (S&P 500 I...
Figure 10.5 Value Versus Growth
Figure 10.6 Value Risk Premium
Figure 10.7 Fama/French US Large Value Index Versus US Large Stocks (S&P 500...
Figure 10.8 The Dimensions of Stock Returns
Chapter 11
Figure 11.1 Asset Class Correlation
Figure 11.2 Markowitz Efficient Frontier
Figure 11.3 Correlation Matrix R
Figure 11.4 Emerging Market Country Diversification
Figure 11.5 Correlation Matrix for Equities and Fixed Income
Figure 11.6 Investing Instinct Diagram
Chapter 12
Figure 12.1 US Small Cap Comparison
Figure 12.2 US Large Value Comparison
Figure 12.3 US Small Value Comparison
Figure 12.4 International Large Value Comparison
Figure 12.5 International Small Cap Comparison
Figure 12.6 Emerging Markets Comparison
Figure 12.7 The Eagle Hanging over the Entry of My Childhood Home
Guide
Cover
Title Page
Copyright
Dedication
Author Note
Acknowledgments
Foreword
Preface: Whispers of the American Dream
Introduction: The Way Ahead
Table of Contents
Begin Reading
Conclusion: It Won't Get Any Easier
Epilogue
Appendix I: My Vision Statement
Appendix II: Disclosures
Appendix III: Index Descriptions
Index
End User License Agreement
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Additional Praise for Experiencing the American Dream
Experiencing the American Dream highlights that successful investing is about personal accountability and making a plan you can stick to over the long run. Investors can find peace of mind by rooting financial goals in their life aspirations. As a result, wealth planning becomes more tangible and investment outcomes are more closely focused and defined.
—Bob MertonAmerican Economist, Nobel Memorial Prize in Economic Sciences laureate, and professor at the MIT Sloan School of Management
Mark Matson understands investor psychology. He knows that, left to their own devices, many investors become their own worst enemies. They trade too often, cling to losers, and buy attention-grabbing stocks. They buy mutual funds they wish they had bought last year or, worse yet, stocks they wish they had bought yesterday. They get excited about the same stock at the same time which leads to losses more often than gains. Investors focus too little on fees and too much on recent market moves. And, without a clear plan, many investors panic when the market drops, as sooner or later it always does.
—Terrance OdeanRudd Family Foundation Professor of FinanceHaas School of BusinessUniversity of California, Berkeley
Mark is certainly an outstanding exporter of my ideas I published.
—Harry MarkowitzThe Father of Modern Portfolio Theory and Nobel laureate
Experiencing the American Dream is about what it really takes to be successful and what it means to live a life with purpose. Discover how to shed the old mindsets holding you back that lead to poor decision-making. Rediscover your values with money and what's most important in your life. What if money was used to make a difference for you and others?
—Chip WilsonFounder of Lululemon
Making money isn't easy and investing isn't for the faint of heart. In a world where financial markets can seem complex, irrational and thoroughly unpredictable, Experiencing the American Dream offers sound practical advice to the nonprofessional investor. Grounded in Nobel Prize winning academic research and sound economic principles, this book empowers readers with a strategy to boldly take control of their financial future. Matson knows how to make money grow. He's achieved his American Dream and this book could help you achieve yours.
—Stephen MooreEconomist and former Wall Street Journal Senior Economics writer
When I was studying at the University of Chicago it became clear to me that the stock market is extremely efficient. When I first met Mark in 1991 he had the same epiphany. Matson has brilliantly communicated many of the critical modern financial theories in this book. Investors, who are drowning in a sea of misinformation, need this type of education now more than ever to make sound investing decisions.
—Rex SinquefieldAmerican businessman, investor, and philanthropist, renowned as an “index-fund pioneer” for creating the first passively managed index fund for the general public.Co-founder of Dimensional Fund Advisors.
EXPERIENCING THE AMERICAN DREAM
HOW TO INVEST YOUR TIME, ENERGY, AND MONEY TO CREATE AN EXTRAORDINARY LIFE
MARK MATSON
Copyright © 2025 by Mark Matson. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.Published simultaneously in Canada.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 750-4470, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permission.
Trademarks: Wiley and the Wiley logo are trademarks or registered trademarks of John Wiley & Sons, Inc. and/or its affiliates in the United States and other countries and may not be used without written permission. All other trademarks are the property of their respective owners. John Wiley & Sons, Inc. is not associated with any product or vendor mentioned in this book.
Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Further, readers should be aware that websites listed in this work may have changed or disappeared between when this work was written and when it is read. Neither the publisher nor authors shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.
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Library of Congress Cataloging-in-Publication Data Is Available:
ISBN 9781394262045 (Cloth)ISBN 9781394262052 (ePDF)ISBN 9781394262069 (ePub)
Cover Design: WileyCover Image: © Jane Kelly / Adobe StockAuthor Photo: Courtesy of the Author
Even before I knew you, I prayed for God to bring you into my life. Nothing that I have accomplished would have happened without you, including this book. Thank you for all of your love, support, courage, and wise counsel. This book is dedicated to you, my wife Melissa.
Author Note
In this book, I share with you my opinions and recollections. That means the ideas I present throughout this book are just one view. Others have different views, and I leave it to you to judge and decide which approach will best help you meet your goals. Don't take me at my word. I invite you to question, research, test, and challenge these ideas.
Also, you should remember that investing comes with risk, and every investor should think carefully about the risk they are prepared to take. Every investor should also know that past performance cannot tell you what future results will be. Even ideas and strategies that performed well previously have risk and can perform very differently in the future.
In this book, I have portrayed conversations involving others. I have put some of these in quotes to indicate that another person is speaking, but these reflect my recollection, not transcripts or recordings made at the time, and may differ from the recollection of others.
The individuals who have been kind enough to support this book by writing a foreword, epilogue, or other statement for the cover are not clients of my firm, Matson Money, Inc. None were paid or otherwise compensated for their supporting words. However, some of these individuals have a relationship with my firm. For example, Mr. Laffer sits on our Academic Advisory Board, and Mr. Lowe has previously appeared at Matson Money events. Others are associated with firms that provide investment products and services used by Matson Money. In some cases, there may have been compensation in connection with the relationship or prior events, or the commercial relationship between Matson Money and other firms. As a result, and because the individuals might receive some intangible benefits from being associated with this book (e.g., heightened brand awareness or reputational enhancement), there may have been incentives for their support.
This book contains data, graphs, charts, text, or other material reflecting the performance of a security, an index, an investment vehicle, or other instrument over time (“Performance Material”). Past performance, including any performance reflected in Performance Material, is not an indication of future results. This information is for educational purposes only and should not be used as investment advice. Investors cannot invest in a market index directly, and the performance of an index does not represent any actual transactions. The performance of an index does not include the deduction of various fees and expenses, or the impact of taxes, each of which would lower returns. Index performance results assume the reinvestment of dividends and capital gains. All investments involve the risk of loss, including the loss of principal. These risks may not always be mitigated through long-term investing or diversification. No investment strategy (including asset allocation and diversification strategies) can ensure peace of mind, guarantee profit, or protect against loss. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. Additional disclosures and information are provided at the end of the book.
Acknowledgments
I have a love-hate relationship with writing. I love it when the words start to flow, and the copy seems to write itself. When there are stories that seem to come to life without restraint from deep within my subconscious. There are glorious times when this book seemed to effortlessly materialize, and it surprised me when it revealed itself. But there were also hard and lonely times of isolation and deep contemplation, and some days when it seemed I had nothing more to give. Hemingway, one of my favorite writers, reportedly said, “There is nothing to writing. All you do is sit down at a typewriter and bleed.” There were many days when that is exactly how I felt.
I purchased an Air Steam trailer and parked it out in the desert and isolated myself to force the work into being. I knew, left to my own devices, there would be too many distractions anywhere else to get the job done. There were days I dreaded the 45-minute drive out into the Sonoran Reserve with the trailer ominously awaiting my arrival. And, yes, there were some particularly tough days recalling my childhood, or destructive screens I had in the past, that I would cry for 15 minutes before I could drag myself over to the computer. At times there were tears of joy at seeing how the American Dream had empowered me and my family. I experienced great happiness at sharing the mindsets and strategies that made it all possible. It was a cleansing process, cathartic and healing.
But although I felt alone in the trailer—I never really was. Every step along the way I had the support of family and friends who loved me and cared deeply about sharing this vision of the American Dream with others. I had colleagues and coworkers that had my back as I hammered away at the keys. No one writes a book alone, and I certainly did not write this one that way. It took a dedicated team to make it all come together.
First, I would like to thank my wife, Melissa, whose strength, courage, and endless support pulled me through. She kept things together at the office, the house, and for our kids and family. When I was at my worst, she was at her best. She pulled us all through it and she did so with grace and kindness. Melissa and I have eight children, and they all supported and encouraged me through the writing process: Mallory, Alex, Amanda, Jordyn, Jonathan, and Madison, and two of whom are still at home, Gage and Liam. They never complained when I had to work late, or on the weekends, or when we had to cut a family vacation short to meet a writing deadline. I thought about you all often when writing about freedom, fulfillment, and love in families. Being your father is a great gift and privilege.
To my mother and father for making the American Dream real for me. I am thankful for all your help in sharing family history with me. The love and care you gave me and my brothers, growing up and today, will always be remembered and cherished. I have deep appreciation for the hard work and stern determination of my grandparents and ancestors who sacrificed in the coal mines and chemical factories to make this future possible.
To my good friend Rob Lowe, whose honest review of the original introduction sent this book in a new direction. It was on a cold and dreary night in Cincinnati, while visiting my mother who was in the hospital, that you implored me to trash the original beginning and share the story of my family saga based on the conflict between my father and grandfather, what it began to reveal to me, and to keep that story line going throughout the work. It was a bold suggestion, and it took courage to share it with me. The book took on a new dimension in that moment—it became a form of memoir, self-development, and investing book. When you read the new version, I asked you to write the foreword, and you graciously accepted. I am deeply grateful for your direction and support—two Ohio boys working together to share the American Dream.
The American Dream is based to a large part on the ideals of capitalism and free markets. Many years ago, my father and I were invited to hear one of its greatest defenders speak at an investment conference. When we first met Dr. Art Laffer, inventor of the Laffer curve and recipient of the Presidential Medal of Freedom, we formed a close and dear friendship. Dr. Laffer has been on the Matson Money Academic Board for many years. I could think of no one better to write the epilogue and share how this great country was united in the past under President Reagan and how with determination and strong leadership it could be again in the future. I am profoundly thankful for your contribution to this work and your lifelong friendship.
A special thanks to Ryan Dempsey, my writing coach and collaborative author; Kevin Anderson for all your dedication and support; and Roger Scholl for your wise editing and structure additions. To my book agents at Book Highlight, Mat Miller, Peter Knox, and Brian Morrison, thank you for catching the vision and running with it before anyone else did. I am deeply grateful to Wiley Publishing: Kevin Harreld for driving and managing the process and Vithusha Rameshan, Susan Cerra, Premkumar Narayanan, and Susan Geraghty for your careful and diligent review and editing.
To Dr. David Eagleman for your groundbreaking research in neuroscience and Dr. Terreance Odean for all your input on behavioral biases and blind spots investors face. I am grateful for the groundbreaking and Nobel Prize–winning research from Dr. Eugene Fama and Dr. Harry Markowitz, who served on the Matson Money Academic Board. To my longtime friend Dr. Lyman Ott for your statistical research into portfolio design and investment premiums. Mark Fortier and his whole team at Fortier Public Relations for getting the message out to the world; you guys rock.
I will be forever grateful to my colleague and early mentor in the money management field, Dan Wheeler. Dan died two years ago but will always be remembered as an early innovator and truth teller in this industry. He largely revolutionized how advisors see investing. In those early days Dan fought in the trenches with me to spread the academic investing principles in this book.
A special thank-you to the visionaries at Dimensional Fund Advisors: without your research and support this book would not have been possible—and to Rex Sinquefield, who first taught me the message of free and efficient markets. With deep gratitude for David Booth and his leadership, innovation, and drive. David Butler, Bryce Skaff, and Hunt Cairns, thank you for your participation in the American Dream Summit and your incredible support in reading, sharing insights, and constant support to make this project come to life. Savina Rizova, thank you for your participation on the Matson Money Academic Board and your excellent research into equity markets and portfolio design.
To Michael Lane, thank you for years of friendship and for your time and contribution at the American Dream Summit. Your dedication to Matson Money is greatly valued.
Any CEO who hopes to write a best-selling book is faced with a monumental question. How do I get the time, energy, and resources to write a book, and at the same time get my company to continue growing while I am in seclusion? Not an easy problem to solve. I am fortunate because I am blessed with an incredible team at Matson Money. Not only did they “keep the doors open,” they also grew the business while I penned this book. Josh Crawford, thank you for your bold and decisive leadership. Your commitment and dedication to the mission was nothing short of extraordinary. I appreciate your insights into the American Dream Experience and your help making this a better book. While I wrote, you coached, trained, and developed the advisors and internal staff, and then when it was time to release this book into the world you drove the promotion and sales like a true pro—bravo. Thank you for your undying dedication and support. In addition, I'm grateful for the hard work and commitment of all of our internal trainers: Luke Rowand, Cody Zindler, Matt Der, and Chris French.
To Dan List, Matson Money president, thank you for your specialized abilities to guide and manage this company as well as your keen eye for editing and all the technical aspects of this book. Without your 30+ years of dedication this book could never have happened. Matt Matson, Alex Crawford, and Michelle Matson, your creativity, loyalty, and hard work leading the teams that are crucial to drive technology, inspire the brand, and develop world-class training and development materials is unsurpassed.
Joel Autenrieb, Heather Nelson, Jeb Snyder, and Rick Wiehe, I am grateful for the trust you all inspire in directing operations and the management of over $10 billion for investors all over North America. It is a monumental responsibility, one I did not have to worry about as I created. And to the whole Matson Money staff, you are an amazing group of people dedicated to saving investors from speculating and gambling with their money and restoring the American Dream. Your efforts are nothing short of heroic.
And finally, to all the advisors and coaches who have fearlessly dedicated themselves to reviving the American Dream and standing up to the Wall Street bullies. Matson Money would not exist without you and the powerful relationships you form with investors. Investors should be grateful to have your bold stand to eliminate speculating and gambling with their investments and helping them focus on their true purpose for money and life.
Although the list is too long to mention each and every advisor by name, I want all of them to know how thankful and grateful I am for all your hard work and dedication. Some of the names are Greg Heaton, Paul Winkler, Gretchen Stangier, Jan Hundrieser, Steve Rice, Mark Connely, Dale Pieper, Ira Work, Leonard Raskin, Steven Vanderway, Ron Geer, Randall Davey, Joe DeLisi, Eric Fischesser, Jonathan Walker, Evan Barnard, Dan Hill, Justin Makris, Trevor Lyke, Jerry Lyke, Robert Colomb, Roy McBryar, Becky Walker, Eric Rothman, Jeff Furest, Nick Sklenar, Bryan Weiss, Anthony Bonanno, James DesRocher, Robert Ramsey, Doug Guernsey, Ben Harper, Curtis Erickson, Eddy Shum, Michael Sarcheck, John Crane, Jim Wood, Maria Kuitula, Phyllis Wordhouse, Charles Stegall, Michael Evans, Leo McGrath, Chris Strehle, Charles Pettit, Sophal Pettit, Vincent D'Addona, Justine Perdomo, Margaret Wittkopp, Fred Taylor, Darren Violette, Rhen Stevens, John Bellino, David Rosen, Doug Brauer, Michael Babin, Kevin Gotwalt, David Shapiro, Jeff Mathies, Kristin Niedermeyer, Omar Pereira, Daniel Salazar, Darrell Doi, Eric Harris, Garry Liday, Jason La Vigne, Jeffry Weldon, Carolyn Weldon, Larry Stone, Phil Webb, Richard Cochran, Kevin Kinghorn, Thomas Blottenberger, Vincent Del Franco, Jamie Smith, Bridget Mackay, Joshua Thomson, Misha Schryer, Raymond Martin, Stephen Stark, Steven Smartt, Alexander Cohen, Angela Ashley, Alex Ash, Anne Sawasky, Brandt Jordan, Christopher Smith, David Yaw, Harry Shepler, Jacqueline French, Jay Bartley, Jeffrey Field, John Weyhgandt, Larry Mott, Michael Ringel, Michael Sailor, Saul Cohen, and Walter Lynn.
Foreword
Rob Lowe
Today, many are filled with questions that would've seemed out of place only a few years ago. Is there a better future? Is the system rigged? Is the American Dream dead? With this book, my friend Mark Matson has written an eloquent answer to these and other pivotal questions of our time. A natural storyteller, Mark will take you on his journey from a child one generation away from the most brutal poverty imaginable to becoming a leading thinker in finance and practitioner of investments at the highest level.
Like me, he was a Midwestern boy who somehow knew there was more to life than what he saw around him. And, like me, he didn't really have extended family, friends, or mentors to guide him on his quest for answers, so he went to work to find the answers himself.
Regardless of what you may initially think, we all have a complicated relationship with money. We love it. We hate it. We want it. We're scared of it. We're scared of not having it. We're confused by it. Some are “ambivalent” about all things financial, which as you will see, can be the most dangerous mindset of all! Mark has spent a lifetime exploring all these matters. And in the end, it boils down to this: How do you make money, and for what purpose? These are simple questions with complicated answers that are found on a journey that is surprising, entertaining, educational, and sometimes emotional.
Mark once asked me to tell him my first memory about money. He explained that those early experiences often set the stage for a lifetime of patterns and prejudices.
I thought of being seven years old and seeing bills and receipts spread across our dining room table for weeks on end. I remembered my stepfather up late at night poring over them doing God knows what. I had a vague notion that this unending and stressful chore was what was required to “balance a checkbook.” And I remember thinking, “I want no part of that.” How could anyone possibly crack this clearly complicated, mysterious, and emotionally exhausting code? I already hated math, so without knowing it, I setup a bias against and an avoidance of personal finance.
Mark then asked me about the first time I made any money. I thought of my paper route. I must've been 11 or 12. I loved getting up early and tossing the paper onto the neighborhood porches. I had a number of techniques for maximum accuracy and a soft landing so the paper would stay folded and not blow away. I had pride in my work. But getting paid was another story. My route happened to be in a part of town that was, shall we say, “in transition.” Timely payment of the paperboy was not really a thing. It was next to impossible to collect, and so I never came close to making the money I should've. In fact, my father, who was a lawyer, decided to teach me about the legal system by filing a small claims case on my behalf. We showed up to court together, both of us in suits. My customers (the defendants) did not. The judge ruled in my favor. And I still didn't get paid. My takeaway was this: hard work gives a sense of fulfillment and purpose, and it can be fun. But on some level, unlike the other paperboys who did get paid, maybe I wasn't worthy of being compensated. Years later, when every other actor on The West Wing received a raise but me, I realized I was right back on my paper route.
As you read on, you will learn how to identify your own monetary worldviews and how they affect your life. You will learn incredible tools to navigate the road to financial well-being. You will see through a new lens the value of capitalism, the true nature of the public markets, the agenda of the financial media and the business of financial planning and investment. But along the way, you will also discover even larger truths and tools, and you will find the answer to the question, What exactly is your American Dream, and how do you manifest it and use it to power your true life purpose?
Preface: Whispers of the American Dream
“You have nothing. Great, start from nothing.”
—Hiral Nagda
The American Dream saved my father, but it couldn't and wouldn't save my grandfather.
The term hillbilly was first formally used in The Railroad Trainmen's Journal IX (July 1892). It was meant to signify people who dwell in rural mountains in areas of the United States. In 1920, the New York Journal described them as people who live in the hills, have no means to speak of, dress as they can, and talk as they please. It was also inferred that they often shot their guns in the air for no apparent reason. Outsiders 60 years ago might have considered them to be backward, unsophisticated, or even ignorant.
This was the clan I was born into on August 23, 1963, in the city of Charleston, West Virginia. My parents were young with few prospects to create anything like real wealth to escape the destitute poverty they were born into. They worked tirelessly there until I was five years old, and then took what was then known as the hillbilly highway leading into the heart of the Midwest. Many others migrating out of the hills of West Virginia and Kentucky would make it as far as Chicago, Indianapolis, or even Kansas City. My parents stopped and laid down roots in Greenhills, a suburb of Cincinnati, Ohio.
It was here they would take a stand to build the American Dream for me and my two brothers, Brian and Matt. My father took a job selling insurance, and he was a natural at it. He was outgoing and friendly as well as intelligent and dedicated to learning his chosen field. Joe was a firm believer in the benefits of education and knowledge, something he would pass on to his children. As my parents committed to raising their family out of poverty with the hopes of reaching the lower middle class, we visited West Virginia every summer to see our relatives.
My father would get us up early on a Saturday morning, rousing us from our sleep well before the sun came up. Any kind of vacation was a big deal. We eagerly piled into the family station wagon. My father drove, and my mother rode shotgun to navigate. Watching them hold hands through most of the drive made me feel safe and protected, as if the love of our family was unshakable and forever enduring. It felt like there was a protective force field around our family.
Because it was long before cars beeped to remind passengers to put on seatbelts, my brothers and I grabbed our sleeping bags and jumped through the open hatch at the back of the car. We settled in for the three-and-a-half-hour ride with no concern for our safety—oblivious to the very real danger of traveling without seatbelts in the back. As kids, we thought we were indestructible.
My brothers and I constantly fought verbally and physically; most of the time it was playful, but sometimes it turned angry and aggressive. We were testing our mettle on each other. Steel sharpens steel, and we were making each other stronger.
Once we set out, my brothers and I tried to go back to sleep but failed miserably; we were far too amped about the trip. Mom was in control of the radio and, for now, had it tuned to Q102, the light rock station. Jimmy Buffett had written a killer song that summer that spanned both country and rock—”Margaritaville.” It seemed to be on a constant loop on our station, and we belted it out every time it came on. We couldn't get enough of it. We had an unspoken contest to see who could sing it the loudest, and it cracked us up every time. My dad could only take so much of this. My mom was more tolerant, but only a little. She was still laughing with us when dad yelled, “Stop that ‘grab assin’ around. We didn't raise you all in a barn. If I have to stop this car, you are going to get it.”
Out of all the times he threatened to stop, he never did. But we still took him seriously. My dad usually meant business if he had to raise his voice. None of us wanted to test his resolve. We talked quietly in the back, watching the darkness go by outside the windows. Then, throwing caution to the wind, we raised the volume back up when good old Jimmy came back on. We loved that Caribbean groove. Instead of Charleston, West Virginia, we imagined we were on our way to Key West.
I always admired the way Jimmy ended the song, claiming his fortunes were his own damn fault. He didn't buy into the narrative of blaming someone else for his trouble or woes. He refused to take the easy way out or thrust his failures onto anyone else. The “wasting away” was on him. And if it was going to get fixed, well, that was going to be on him, too. He went from it's nobody's fault, to it could be his fault, to it is his fault. He moved from being a helpless victim of mysterious forces to someone who discovered they have a say in life.
Driving east, we watched the sun rise through the front windshield. An hour and a half into our trip, we found ourselves in the middle of Ohio farm country, surrounded by chest-high cornfields. It would be years before cell phones were invented. We were so cut off from society that it felt like we were on the dark side of the moon. As time dragged on, we became restless.
Tired of lying down in the back of the station wagon, Brian, Matt, and I climbed over the back seat to sit in the middle of the car. Now, we were directly behind my parents. Brian was 11 and Matt was 8. Matt and I made sure Brian was in between both of us. Bored, Brian pulled out a book from his Greenhills Pioneers gym bag and began to read. If you tried this on the roller coaster roads of West Virginia, you were asking to be car sick and puke, but the highway was relatively straight as the twisted roads of the mountains were still an hour off. The minute he started reading The Lord of the Rings, that was our cue to begin our chant. “Mr. Reader, Mr. Reader, Brian is a Mr. Reader.” Matt and I thought this was gold. Of course, it was juvenile and immature, but we got a big kick out of it. On occasion, Mom had let us stay up late to watch Saturday Night Live. And in our minds, we were up there with Chevy Chase and Richard Pryor, my favorite comedian. The Cone Heads and Blues Brothers had nothing on us, or so we thought.
If the chant alone didn't work its magic and cause Brian to yell at us and then (despite his resolve to stay upset) give into the odd and ridiculous nature of the moment before finally laughing with us, we took it to the next level. Both of us scooted as close to him as we could, sandwiching him between us, and began to flex our butt cheeks in rhythm with the chanting. Brian could have quite the temper, and this usually got him going. This move was sure to make him lose his concentration on Frodo of the Shire.
“Stop it! You guys are annoying,” Brian threatened.
“What's that matter, Mr. Reader,” Matt goaded him.
“Mom, Dad they are bothering me. Make ’em leave me alone!” Now he was bringing in the big guns.
My dad said, “Leave him alone, or you are going to get it.”
“You are going to get it” was his mantra along with “Don't worry about what anyone else thinks.” We must have heard each of those 10 times a day. If he stopped yelling, we knew we had a real problem, but my father's voice had slightly cracked, so I could tell he was trying to hold back a laugh. We were a very loud family, except for my mother. She was our calm sense of reason when we got carried away.
True to script Brian finally relented and began to laugh hysterically. The three of us, together with my father, guffawed good heartedly. Mom sat in the front seat smiling.
My parents had not only gotten us out of the hollers of West Virginia, they had created a home where it was okay to have fun and even be silly. We were encouraged to express ourselves and talk openly about almost anything. We didn't have a lot of money, but the sense in our family was that life could be an adventure and should be lived fully. Our home had an optimistic energy surrounding it. The type of energy that said anything is possible if you are willing to work hard enough. It was the idea that things could and would always be better. My parents communicated to us that life was full of wonder and something to be celebrated and cherished. It was meant to be lived fully and boldly, on your own terms. Let others be damned if they didn't approve of or understand us.
We saw other people as basically good. There was a sense that the future would be better than the past. But the past was also full of stories, and if you kept those stories close to you and alive, you could glean messages and powerful meanings from them. If you cared to pay attention, there were morals and meanings to stories that could make your life and the lives of others better and fuller.
When the empowering moral of a story was not self-evident, my father taught us that we needed to dissect and tease it apart to find the brass ring of knowledge concealed inside. He also cautioned against letting the pursuit of “the ring of wisdom” you were seeking (like Gollum and his obsession with his precious) overtake and dominate your life. In other words, never forget your roots or “get too big for your britches” and let money, power, or fame destroy you. He often chided, “Never take yourself too seriously. You must be able to laugh at yourself.”
My parents lived by example, and although my mom was often quiet and reserved, my father never met a person he didn't immediately make his friend. He was a masterful storyteller. When he got going, he would tell one story after another, the flow of tales creating a kind of magic all their own.
There was a sense of playfulness in our family, and although my father could be a firm disciplinarian, there was constant humor and lightheartedness that pervaded everything, including long car rides. Still, a somber feeling penetrated our station wagon as it barreled to the West Virginia border. I made it my job to listen to everything my parents said about life. I was already working on my grand opus on how life works and its many hidden mysteries. I sat calmly as my parents discussed the health and welfare of our family back in the hills. Who had gotten ill, lost a job, or retired? What were my grandparents doing? How did they live their lives? Had anything changed since our last summer trip there? It seemed that someone was always moving back up in the hollers after trying a brief stint in the city. There was much talk of “the family” avoiding any real change or new ways of thinking. My parents called it being “stuck in their ways.” In retrospect, that was a kind way of putting it.
The West Virginia countryside was beautiful—the mountains a stunning shade of green with outcroppings of stone atop them. The valleys were adorned with crystal blue rivers and streams. The sight of them always prompted me to say, “I bet there is a ton of fish in there!” My dad would retort, “Bet your ass there is. I used to fish that river when I was your age.” But against this idyllic canvas of beauty, the poverty was soul - crushing. As we drew closer to my grandfather's house on my dad's side, the more desperation and decay appeared.
Many of the creeks (pronounced cricks) that ran up the hollers were full of discarded trash. Among the scenic boulders were rusted out truck beds, discarded washing machines, moss-covered couches, and broken-down furniture of every kind. Signs saying no dumping were routinely ignored. Some were pockmarked with bullet holes. Deeper into the hills, many of the houses were little more than rundown shacks, mixed in among the trailers.
Many of the yards were strewn with garbage. Front porches were constructed with plywood and crumbling cement steps leading up to them. It was an army of broken TVs, discolored wash tubs, rusting bikes, and plastic toys strewn here and there. The sides of these houses were virtual junkyards, covered with grime and neglect—lawnmowers, plows, cars, bed springs, shovels, broken satellite dishes. These were not relics some industrious mechanic was ever going to repair or make useful again, nor were they antiques to be sold off at a local flea market. This was dirt and filth. It was clear the owners had no intention of cleaning up their yards. Neglect had turned into a tapestry of despair.
It was a direct affront to the ideals and principles my father and mother were working so hard to build into me and my brothers. It shocked me to see children playing among the refuse. One of my mother's favorite sayings was, “It is not a sin to be poor, but it is a sin to be dirty.” My mind raced with questions. Why did these parents make their children live this way? Why couldn't they carry their debris past the front porch? And the overarching question: How can people live like this? The poverty I could understand. But the lethargy and the sloth were unfathomable. If I could unravel this mystery, maybe it could shed light on how to avoid a similar fate, or perhaps, and this seemed like a long shot, how to live an empowered life of greatness and abundance. Clearly there was a sort of learned helplessness hiding in plain sight here, some kind of failure to be and act. There was a debilitating lack of freedom in evidence. My fellow hill people were not being held physical prisoners, but there was something destroying their lives and keeping them firmly in place.
My grandmother was a large woman; she only wore overflowing V-shaped mumu dresses. My grandfather was, by contrast, “thin as a rail” in West Virginia speak. Later in life, Retha would contract throat cancer from smoking and subsequently had her larynx removed. In its place, the doctors created a hole where she could breathe. She talked with the aid of a vibrating handheld device she placed on her neck, below her jawline. Her artificial voice sounded robotic and harsh, and it was hard to understand what she was trying to say. The hole and the machine voice made me afraid of her. I felt terribly guilty for those feelings. But when she hugged me in that mumu dress with her big arms, that feeling of fear disappeared and was replaced with a feeling of safety and warmth.
I was not close to my grandfather—I'm not sure that anyone was. My father told me his father never hugged him or told him he loved him when he was a boy. He showed a similar disinterest in his grandsons. Sitting on his lap, getting “horsy rides” and being told he was proud of us and loved us was not in his range of affection or emotion.
As we approached Grandpa George's house, a strange silence crept over our family. There was no Jimmy Buffett on the radio, and no teasing and taunting of each other in the back seats. My mom and dad were equally still in the front seat. There was no sense of joy or happiness to finally be here. Our presence there felt more like an obligation than a celebration of family. I felt the silence pressing in on me.
The small yard was surrounded by a chain link fence that resembled a prison fence. It was unnaturally high, well over my head. It gave the impression that it was meant to keep something or someone in, not just out. Inside the fence, the yard was full of overgrown weeds. No one had planted flowers or decorative shrubs of any kind. One struggling maple in the front yard looked diseased and spindly, barely hanging on. Between the weeds were patches of dirt and gravel. Not even the dandelions and witch grass could find purchase there.
In the back yard, there was an upside-down metal flat-bottom boat resting on two dilapidated sawhorses that were devoid of paint and had rusted nails sticking out in all directions. Whoever built them never heard my mom's speech about the dangers of tetanus, or just didn't care. That boat and sawhorses were what my dad called “an emergency room trip waiting to happen.” He wasn't wrong. However, that didn't stop us from playing on it.
The boat was the one thing in the yard that signified any real life or sense of fun and adventure. It must have been made of galvanized steel because it had managed to escape the rusty destruction all around it. But it had been abandoned for years. We wondered when the boat had last been in the water and seriously doubted it would ever be there again.
We arrived just in time for breakfast: fried eggs, sunny-side up, bacon, and strawberry jam. Grandma also served up homemade biscuits and sausage gravy. The smell of the food cooking mixed with the stale odor of Marlboro Reds. My wife's family is from the hills of Kentucky; she also remembers growing up with the taste of biscuits and gravy for breakfast. When we go out to brunch, we often order biscuits and gravy with the hope of reliving the nostalgia of our childhoods. Sometimes there is just no going back, even when you want to.
Walking in the front door, the home smelled as musty and decayed as a crypt. The walls were a flat yellow from years of cigarette smoke. The carpet was a faded tan. There was a couch and two chairs in the living room—a short hall with a bathroom and two small bedrooms on either side.
My brothers and I found an old wooden wardrobe in our assigned bedroom. We imagined we were entering the land of Narnia when we climbed inside and closed the door behind us. We found an old flashlight and used it to go through boxes of black and white pictures of people we didn't recognize. Everything had the pungent odor of mothballs. Most of the pictures were of people standing outside of their shacks up in the hollers, or coal miners covered in dust, wearing hard hats with headlights. They were always standing by a mineshaft. And no one ever smiled. They clearly lived a hard life, and they were all deadly serious.
There was no central air in the house, but we did benefit from a large window fan as we slept that night. Its steady hum soothed my ragged emotions. The fragrance of trees and grass filled the room. But there was also a faint scent underneath that I couldn't quite place, but it reeked of death.
Everything about their home felt gray and subdued. Even the television in the living room sat ominously still. I never saw it on. Its giant ashen eye looked unblinkingly into the room, like a monolith. To this day, I do not know if it was broken. It sat unmoving like a giant lifeless cyclops. The home was totally unremarkable with one exception. On top of the television was perched a beautiful gold skeleton clock, with an engraving on the name plate:
George S. Matson
In recognition of 25 years of
Loyal Service
Union Carbide Corporation 1970
It was an Atmos clock, designed and made by Jaeger LeCoultre, a marvel of human engineering and art. It never needed winding, batteries, or electricity. Instead, it functioned by harnessing different air temperatures and pressures in the room. Ethyl chloride in the clockworks expanded and contracted, causing the bellows to fill up with compressed air, which in turn drove the mainspring. Adding to the wonderment of the clock, its internal mechanisms were visible from every angle, encased in glass. Somehow, the inventors had created the illusion that the working parts were floating inside the glass.
It was a stark reminder of the possible miracles of the world outside of these walls. It was the only object in the house that showed any signs of beauty or hope. Sadly, it seemed my grandparents were content to waste away in their self-imposed prison until the bitter end. Retha died some years later, and George soon followed. When their children inventoried the contents of the meager home, the clock still sat on the television, stubbornly ticking, untouched by the ravages of time. In a world of poverty and what Thoreau called “quiet desperation,” the clock shined on, its gold magnificence seemingly mocking the spent lives of the house's former inhabitants.
After four days visiting our grandparents, aunts, uncles, and cousins in and around Charleston, we were ready to head home. The longer we stayed, the more our country twangs reasserted themselves.
Our mood was somber as we made our way home to the new world we were creating together. But we were grateful to escape. The poverty I had experienced in the Appalachian region was persistent and generational, like a curse, embedded in the very fabric of the land. Even as a kid, I felt it was not just a function of a poor economy, but something more sinister and permanent hidden under the surface.
Despite the poverty, my family who remained there were friendly, generous, and kind. As my mom would say, “They don't have much, but they would give you the shirt off of their back if you asked them for it.” But what I remember most about them was that they were incredibly funny. They were always joking and laughing. Most of the humor was improvised while some of the jokes were repeated year after year, like a vinyl record player stuck in the same groove, repeating the same phrase of music, over and over. But the humor was part of who they were. I suspect they used it to cover the harsh reality they faced, like a salve to heal their wounds. Perhaps it was their way of pretending things were not really “that bad after all.”
Was there something about the way my hillbilly brethren thought about themselves, the world and money that locked them into the reality they experienced? If that was true, then how had my parents escaped the same fate? Matt was more interested in playing a Mattel electronic football game, and Brian wanted to read about Frodo as he approached Mordor, but I was fascinated to learn more, so I peppered my parents with questions about their childhood.
“Dad, what was it like when you were a kid?”
“Well, I was born in 1940 just after World War II started. One of the things I first remember was hiding under the desk at school when they practiced air raid drills. Like that was going to work.”
“What was your first house like?”
“When I was four until middle school, we lived down by the railroad tracks. You think grandpa's house is small, you wouldn't believe how little this thing was. It only had one real bedroom, a short hall, tiny kitchen and one room in the front of the house. It was me and my two brothers, Virgil and Don, my two sisters, Evelyn and Mary Ann. The boys shared one bed and my sisters another. Then there was my mom and dad as well as her parents. It was super tight.”
“What did you do for heat in the winter?”
“We got our heat from a little gas fireplace that was lined with asbestos.”
I found out that this was quite common in the early 1940s. The fireplace was made from a material called Transite; it was a form of cement mixed with asbestos filaments. This was used to insulate the fireplace walls from catching fire and push the heat out into the room. Like so many things in Charleston it was extremely dangerous. Over years of use, the cement becomes friable, so the asbestos strands heat and becomes airborne, causing lung and other cancers.
“The back of the fireplace burned red hot in the winter, and as the temperature dropped, all of us huddled around it. Damn, it got cold.”
