Ujamaa | Cooperative Economics - Master P + Baron Davis to Buy Reebok

 I got my toughest challenge a few months ago when someone tried to label me. I'm not one for labels, so I stumbled when asked "What are you?": a Mentor, Wellness Trainer, Personal Finance Advisor, Life Coach. I simply tell people I am a businessperson. I challenge everyone in the world to begin to act and think like one. Why??? Because once you leave the safety net of your parents home (usually @ 18 years of age), everything else in your life with be a contract --- economically and spiritually. I think back to leaving college and everything from the cell phone, apartment lease, rental truck, job offer, car loan, and monthly credit card bill were all contractual obligations. If I'm not a businessperson, then why am I signing a contract??

So it's only fitting that the black candle of Kwanzaa on Day 4 symbolizes my most blogged about subject, Cooperative Economics. Economics was one of my favorite subjects in school because it had basic assumptions that focus on what humans do when they are facing certain options --- the guns vs butter theory. A quick trip down memory lane:

A nation, and I apply this to your concept specifically to your household, must determine how to spend its monies (budget). If you spend it all on butter (food, schools, etc.) then everyone's bellies are full but this nation may not be safe. If you spend it all on guns (fences, alarms, rifles), then you may feel very safe but go hungry. Ironically, these are the simple items most people and politicians still fight about today. 

• Increase the security defense budget?
• Decrease the budget for food, school, and health assistance?
• What about arts, culture, drug mitigation, violence mitigation?

In your home, one must decide:

• Do you buy a home, how much?
• Do you buy that new car or take the bus?
• How much do we spend on food, toys, education?

All tough decisions but necessary ones that must be made. So my challenge is for people to be humble, focus on strengthening your knowledge and collectively working together to build and expand the economic profile of yourself and your family. Work hard, then harder as we have one life to live. If you're pop culture, you now call this concept the gig economy or accumulating side hustles. 

I call it UJAMMA - I look at how history has treated the middle class in America and across the world and more importantly I looked at how history has treated people of color, anyone who looks different. I took Economics and loved it and realized very quickly the data doesn't lie. The middle class is getting gutted and poorer, year after year. Communities of color make advancements, but due to government policies or the lack thereof suffer massive setback during recessions, depressions, and periods of health pandemics. If you've read my previous posts on this subject, this equates to a person of color losing a massive amount of their equity or wealth roughly every 8-12 years. 

So I challenge you to focus on where I spend most of my energy, achieving balance and UJAMAA. I have a cooperative of investments that ensure I will withstand things I cannot control and the things I know people will try to do to hold me down. 

• I have a saving account that will withstand 1-2 economic recessions
• I have an investment account to supplement my retirement and fund investments
• I work a Corporate job, earning pay and benefits such as a 401K which I've maxed out every year for 18 years (someone is giving you free money)
• I have a side hustle, where I work with persons of color, veterans, woman, single moms as I try to diversify Corporate America while bring them value in the Cybersecurity space
• I own real estate which pays for itself and provides income for my next real estate venture

I just learned that Master P and Baron Davis are looking to buy Reebok for roughly $2.4 Billion dollars. Ironically, what I was more interested in is who is the investment team that came together to pitch the deal terms. Fact is most deals done are done as a cooperative, in Silicon Valley they rely on Venture Capitalists and in our community we must embrace this concept. I also challenge you to shop with black owners but I challenge my black owners to think bold. My cyber services are not limited to a group of people, many of your products will need to be able to supply the world. This helps you achieve SCALE. A level where you can supply many people across the country and eventually the world. Sky's the limit

Individual Retirement Accounts - Being The Boss of Your Retirement

Investing In Yourself – Using Pillars to Build Your Core	https://urbanomics.blogspot.com/2015/04/urbanomics-pillars-path-set-for.html
Setting Budgets + Saving for Black Swans	https://urbanomics.blogspot.com/2013/02/personal-finance-budget-101-free-credit.html
	https://urbanomics.blogspot.com/2019/11/hey-henry-high-earner-not-yet-rich.html
How to Open My First Brokerage Account	https://urbanomics.blogspot.com/2015/04/personal-finance-101-starting.html
Diversify your Life (Mind, Body, Soul, + Investments)	Search My Blog

Coronavirus Update – Do You Think They Are Listening To Your Plan?

I’ll make 2 quick assessments.  I’m of the belief that we are moving too slow and in a fragmented manner. Tone at the top, is when the highest leader of an organization sets the direction and PLAN which gives everyone instructions on what to do.  Assessment  1 -The tone from our leaders has been slow --- despite the rumors people are spreading--- there is no “National Holiday” that has been declared. Something like this would have to come from our President and federal government.  So what does that mean, you need to be listening and looking to your local city and state leadership for direction because each and every city will deliver their own instructions. This is fragmented and leads me to believe that the handling of this outbreak will take longer than may be needed.  We’ve gone from different messages: a) go about your daily lives, b) social distances, to c) hunker down??  Very early on you saw that I’ve called for a national holiday. This approach goes further than social distancing because it tells everyone to stay home but reassures the masses that they can pay bills if they cannot work from home. You identify the sick, give them help outside of our fragile hospital system, don’t expose others, and try to assist the stores and restaurants with supply chain and safety measures for shoppers. For example, set limits against hoarding and push people to order ahead and people of means can continue ordering from restaurants thru delivery if done safely.  Assessment  2 -  I called for testing --- this reduces the panic in the air. The truth is if you show any symptoms of any type of sickness you need to isolate yourself, remember there is no cure. But testing helps to comfort us and know what we are dealing with. Thanks to companies like Roche Diagnostics stepping up, they are producing over 400K testing kits each week to now assist the country.  The elderly and vulnerable need to seek help first and if you think your symptoms are progressing then you should seek assistance. So currently, I know some people are still physically going to work and I can attest not everyone is an essential employee. I know some schools are still open. This uncoordinated approach IMO delays stopping the spread.

What Comes Next?

Well let’s think about what I’ve laid out above.  A fragmented approach is leading to companies and schools closing on their own terms. By not doing it in coordination you will now have a fragmented and unclear approach to layoffs, furloughs, and how employees get paid. Even if you can work from home, what decisions will your company take if their sales/productions/revenues dip?  Remember this is NOT just in America but across the world. So my math leads me to believe that things will get worse before they get better and yes that means Recession signals.  I’m mentally planning for a Recession and making minor adjustments.  1st Budget and Save à  If the government does NOT help out you and me (main street) you need to build and rely on your saving to ride through the rough patch.   2nd Renegotiate Bills à Call everyone but the Water/Sewer, Gas, Electric Cos.  If you pay for cable, internet, cell phone, and mortgages now is the time to determine if you need that service and IF they value your business. For example, sorry Sports Fans – if all sports is canceled do you really need the Sports Cable Package?? 3rd Refinance à Because of poor leadership, the markets are panicked. For example, you’re not crazy if you got a response from a bank last week quoting you pretty bad rates. I learned that the market which buys mortgage products seized up. Good news is call back, the Federal Reserve last night indicated they will directly begin buying mortgage products so RATES SHOULD START going back down. Don’t settle Me personally, I can’t watch the NBA, English Premier League, or March Madness right now so it’s time for cable to go. My refinance is in progress and I’ll keep you posted on my savings.

What About My Retirement?

Once you have your budget in-line, the savings will slowly start to roll in. Then it’s time to think about your individual retirement account (IRA). I don’t like to advise people on what to buy and do because we all think differently. If you read what I posted above, my thesis is the actions NOT being taken by our leadership will prolong this crisis. If my thesis is correct, the market will fall further and we may technically reach recessionary levels.  The reason I like to invest is you can tell the real from the fake. Many people like to give you their opinion, but would they place their own $$ on what they are telling you. To mess with people, I often ask them would they be willing to bet on it…and that’s when they get quiet. If you have done the work, the rest is to follow your instinct.  I have a savings account that allows me ride this store out no matter what happens. That allows my IRA to truly be just that…a retirement accounts.  So for my real ballers, think about this concept. If you believe the markets are NOT going to do well for awhile --- why stick around. I call it my Sandlot Move à I take my ball and leave, like Jay Z said “I don’t need the NFL, the NFL needs me”.  If you don’t know what he’s talking about here --- keep working on the pillars we lay out here and you soon will. I make moves when I say so and in this environment, I don’t need to put my retirement account at risk because some guy in an ivory tower tells me wait it out. So what if I miss some of the rebound, I’m still good. I’ll catch the markets when I can go to an NBA game again --- or maybe an NFL game Jay J

Urb Lesson of the Day – Individual Retirement Accounts (IRA) are not something to be taken lightly. First diversify your IRA. My buddy told me something that I thought was no longer widely practiced after the days of Worldcom and Enron going out of business. He mentioned he had most or all of his 401K retirement account in his company stock.  It’s great to be a believer in your company but you must be diversified.  Before Enron: Many companies matched 401K funds in Company stock. Employees were often required to hold the stock until retirement or closure of the account. That IS NO LONGER THE CASE. You're more than welcome in leaving in all company stock but know you are gambling and not investing. You could win BIG or go BUST.   My advice is even if you work at Apple, ensure that your entire 401K is not in company stock AND if your match is in company stock --- elect to have it go cash (Stable Value Fund) or something like the S&P 500. Then later when you evaluate your account (each month or quarter) you can CHOOSE to have some of it going to company stock. Never let someone choose for you. Boss move

Coronavirus / Bear Markets --- What to Do With My Investments?

Investing In Yourself – Using Pillars to Build Your Core	https://urbanomics.blogspot.com/2015/04/urbanomics-pillars-path-set-for.html
Setting Budgets + Saving for Black Swans	https://urbanomics.blogspot.com/2013/02/personal-finance-budget-101-free-credit.html
	https://urbanomics.blogspot.com/2019/11/hey-henry-high-earner-not-yet-rich.html
How to Open My First Brokerage Account	https://urbanomics.blogspot.com/2015/04/personal-finance-101-starting.html
Diversify your Life (Mind, Body, Soul, + Investments)	Search My Blog

Thanks for tuning in. I've heard from so many people so these discussions will frame my upcoming blog posts. For example, I raised the discussion of what to do with your retirement accounts so I'll be addressing that soon. This week, I fielded multiple questions on should I start buying. I will try and address all of these items but not in a frantic manner --- remember we were built for these moments. We've been investing in ourselves, setting our budgets, saving for black swan events, diversifying our portfolios and strengthening our core for these very moments.

People and Safety First

First things first ☝ always remember that people...yes I said people and safety always come first. That is why I was so passionate about what the next steps should be for this country during an outbreak like this. As a risk manager, this is the number 1 rule and it must not be forgotten.  If this were my favorite show "Heroes" you would hear the phrase 'Save the Girl' --- well my response to the administration is 'People First Profits Will Come'.  Sometimes we all need that subtle reminder. 👂

Stick 2 Da Script

If this is your first time get familiar with my pillars above. If you've been here before don't forget them because this is a life-long journey of having the tools you need when things are GOOD and when they are BAD. Again I've received a lot of questions this week and I assume people will take their time to read through my blog before firing off their questions but that isn't always the case. The most common questions I get are:

• Is it a Good Time to Buy?
• What Stock(s) Should I Buy?

These are solid questions if you are a seasoned investor, who invests in the markets often. However, I want to start a new trend --- where people are comfortable talking about how much they got in savings first!  You tell me what car you drive, where you work, your favorite drink, damn some people even rattle off their credit score BUT people get real quiet about their savings.  So I'm here to remind you of my Rules above...because the first investment you should be asking me or anyone about is How Can I Invest In Myself.  And here is my answer:

Set a Budget  Every winter its 2 things -- cuffing season 💑(if you're single) and budget cutting season ✂. I revisit my budget and guess what I found out -- It goes UP, DOWN, or stays the same. It rarely ever stays the same so I challenge everything that goes up.

Mortgage - Have you refinanced?

Insurance - Have you asked for lower rates or called a new competitor for quotes?

Bills - Can't fight these much but do you need that super cable -- when you work 5/7 days a week a least? Can you phone a friend for that Netflix account?

Urb Lesson of the Day - Being a boss means doing the dirty work, and having tough conversations. This week alone, I had CEO discussions with my banks and what they need to do to keep my business --- remember they work for you.

Start Saving 💰 - Real savings IMO is the money saved up AFTER you have no outstanding debts in your household. So set your budget to get on a plan to begin saving for your future and future BLACK SWAN events. Before the coronavirus crisis, I've talked about black swan events being the one thing we are always on the look out for.  Well that event is here and a deep savings account helps ease those of us panicking if schools are closed, your company shuts down temporarily, you unfortunately get laid off, medical bills surface, etc. Remember the government shutdown, H1N1, 2008 financial crash make sure you're not a part of this statistical group:  Roughly 70-80% of American workers live paycheck to paycheck. (Source: 2017 Careerbuilder Report)

This is why I was passionate about putting money in hands of the American people. I predicted state and national shutdowns would be required to slow down a contagious disease (note: China, Italy, S. Korea all showed why this is necessary). That finally happened here in the US.  Why was the response so slow? Well, they are scared to shut the system down --- because the capital machine has most people living paycheck to paycheck. So work can never stop (for those who cannot telework/work from home), I guess even when your health may be at stake.  I applaud this gent for keeping it real on national TV, he acknowledged its a big problem when most Americans live paycheck to paycheck:

Urb Lesson of the Day - I live to save because there will always be black swans, moments that shock you and your family --- weddings, deaths, travel, layoffs, medical bills --- you want to have the savings to get you through these moments. I know the rent, bills, and food has to be paid but the long-term plan is we need a healthy you to be a provider for yourself and family for years to come. Use these markers to benchmark how much you need to save for a rainy day:

2 Weeks Pay --- Rookie

1 Month Pay --- Rising Star

3 Months Pay --- Honorable Mention

6 Months Pay --- Veteran

12 - 24 Months Pay --- All Star (Cue Biggie: "I'm not only a client, I'm the player president")

 

I personally have moved to cash in my individual retirement portfolio because you have to sit down and map out what happens next: businesses slow down, layoffs will rise, and earnings from corporations will be bad for the next few quarters. My retirement money is just that a second savings account I can afford to be very careful with.  Your primary savings account is a cushion for whatever is to come. Stay tuned for more, I will address what to do with your individual retirement accounts and for those aggressive people trying to gain an edge in the market --- YES we'll discuss stocks to buy.

Fitness Tracking to Slimmer Pants & Bigger Profits

What's the point of  these Urbanomics Pillars: “Spiritual”, “Financial”, “Physical”, and “Mental” if I am not applying the tools that have made me successful in business and in the stock market to my health. Are you going corporate on me??....Quite simply, yes :)  When I sit back and reflect on what things made me college recruited football player, I circle back to one word: DISCIPLINE..not a fad or a diet or a quick fix.  I'm getting OLD but the one thing every gym rat had in his or her hands before phones and fitness trackers took over...was a WORKOUT SHEET. This sheet tracked my progress and told the story if I got stronger, faster, and more agile.  I still used a spreadsheet up until a few years ago because it was built into my DNA. But with a very busy schedule at work I noticed I was declining into a part-time gym rat, I'd go for a few months...then stop because of work or life imbalances.

I decided to stop making excuses and use the same tools that I use to track my investments:

Health Goal: While I would like to retire financially fit and early...let's add physically fit

Budget: While I have a financial budget, I needed to have a health budget (Higher Calories Burned minus Calories Being Eaten = Healthy Rewards. Keep it simple

Risk Management - In the stock market, Warren Buffet has 1 rule...never lose money. So why not transform this rule simply to: Don't Gain Weight. If I stick to my budget (above) some days I might not lose weight but ultimately I won't gain unhealthy amounts of weight.  If I am thoughtful, I can CHOOSE to just eat a little less OR more of something healthier. I choose to not invest in RISKY Penny Stocks so why not cut back on risky foods :)

Benchmark: You're not managing your money wisely IF you don't know what the average market returns.  So to understand the averages, I purchased a Fitbit health tracker and used their baseline. 8-10K steps (3-5 miles), climbing 10-20 stairs a day, walking at least 3-10 minutes an hour (during the 8 hr workday). I added in basic government calorie consumption guidelines and ATTEMPT sleeping 8 hours a night. 

Tracking: I have an fitness tracker that tracks my portfolio because I need to BEAT the benchmark to be financially fit. My goals are set to the benchmarks above and it creates a "no excuses" culture. I couldn't believe early on what the reader was telling me. Sometimes with work, I might not move within an hour...what!!!  I've lost over 10% of my body weight, wear clothes that didn't fit, decreased the waistline, and more importantly watched things like my resting heart rate drop.

The path to bigger pockets is being active and clear: mind, body, and soul, so get moving and don't let unhealthy habits drain your riches in your later years. I share my health goals with others so its no longer weird when I excuse myself for a 10 minute walk/break, jog at random times in my house to reach my goals, look forward to cutting the grass each week to pad the ole stats. I'll tell you more about my eating adjustments later but a low carb/Keto/S.Beach like lifestyle has grown on me and even allows me to FAST now for multiple hours in the morning, still feel great, and many times I feel sharper when making business and investment decisions. If you've cheated yourself...get back in balance and slimmer pants and a calmer mind could mean bigger pockets.

I'm Tracker Agnostic so tell me if you're a fan of Fitbit, Apple Watch, Samsung Gear, Garmin, AND more importantly what you track.  For now, I'm gonna "Walk It Out" to my goals:

Walk It Out

Personal Finance - Budget 101 / Free Credit History

I often get a number of questions related to everyday finances and how a reader can improve their financial health.  First thing first, is to take care of the basic key elements.  The second thing is to is to do it as cheaply as possibly.  And yes, don't let anyone fool you...you can Do It Yourself (DIY)!  There are a number of personal finance lessons that I have written about in the past and I will attempt to go back and re-tag all those posts to include the labels "PERSONAL FINANCE".  I will create a link for easy access to these tips but remember you can search the site to find notes and tips to assist you get financially healthier.

1) Going On a Healthy Diet - Budget, Budget, Budget

I am personally a spreadsheet man myself.  I create a very basic Excel spreadsheet that I use to track all my budget needs. So search the Internet and you can find many tools to assist you with Budgeting 101.  The key elements don't change often, so follow these tips:

• Categorize every expense by type and don't use MISCELLANEOUS (Examples: Utilities, Food, Entertainment, Auto)
• Don't you cash unless remember to 'categorize' every penny...exactly "Don't Use Cash"
• At the end of a Month, your goal should be to have more "Income" than "Expenses"
• Don't be afraid to make hard cuts (sacrifice now for a better future, every penny counts)
• Pay down debts quickly, and FOCUS on high interest rates first (Credit Cards, School Loans, Personal Loans)
• Once you pay off debts, try to pay off any new debts 'Each Month'. I know every month
• Yes its okay to have FUN, but budget and categorize it
• Use the extra money from your budget to "Invest In Yourself". The goal is to create a rainy day account

I use spreadsheets and some people use envelopes, but the important thing to remember is to find a system that works for you and to stick to it. Just like working out.

2) Get on The Scale - Check Your Credit For Free

Unless you can pay for everything with cash, then you need to be honest with yourself and "Weigh In" from time to time.  Financially, weighing your self on the scale is "Checking Your Credit History".  This is the one time when you want your numbers to go UP! A higher credit number is much better than a low score.  Now don't get crazy, check your credit annually...no more, no less.  Look for errors and make sure you pay your bills on time.  There are 3 scales that you will need to weigh in with, and they are the 3 major credit bureaus: Experian, TransUnion, and Equifax.

DIY Tip: Don't listen to commercials or some salesperson over the phone, check your report FOR FREE.  Yes, the government passed a rule years ago allowing you and I to have a FREE view of our credit history, once a year...and it can all be done through one website!  If anyone else claims to offer this service, ask them if you will ever be charged...and don't forget to tell them that you are recording the conversation. That should do the trick :)    Here is the link:

AnnualCreditReport