Chapter 14: The Hypocrisy of the Gurus - The Millionaire Fastlane

CHAPTER 14: THE HYPOCRISY OF THE GURUS

There was a time when a fool and his money were soon parted, but now it happens to everybody.
~ Adlai Stevenson

You've Been Duped

Suppose after college you're getting a bit pudgy around the middle and decide it's time to get back in shape. You enroll in a community college class called “Healthy Nutrition: Eat Your Way to a Beautiful Body.”

On the first day of class, you arrive early, seat yourself, and anxiously await the class instructor. After a few minutes, an obese man walks into the room and waddles to the front of the class. You think, “Wow, he's fat . . . but he's here to change that … good for him!” As the man profusely sweats while fumbling with a stack of papers, you glance at the student chair near the man and wonder if he can fit on it … he's twice the size of the chair!

Then suddenly you're hit with the paradox.

This isn't a student but the instructor! Are you freaking kidding me? How can this man effectively teach a class called “Healthy Nutrition: Eat Your Way to a Beautiful Body” when he is not a model of his teaching? How can anyone take him seriously? Bewildered at the hypocrisy, you leave the class and head to the bursar's office, intent on getting a tuition refund.

When it comes to gurus and financial advisers this is what you must do: leave class and request a refund because they're guilty of a Paradox of Practice.

The Paradox of Practice

The Paradox of Practice asks, “Do you practice what you preach? Are you a model, an exemplification of what you teach?”

Would you take skin care advice from a butterface?
Would you take financial advice from a bankrupt bum?
Would you take medical advice from a sanitation worker?
Would you take bodybuilding advice from a 90-lb. weakling?

The Paradox of Practice is a heated debate in my forum. Some feel it's perfectly acceptable to preach a strategy for wealth yet never use it.

Do as I Say, Not as I Do

A Paradox of Practice exists when someone promotes a moneymaking strategy but that strategy is not what made him or her rich. In other words, they're not practitioners of their own advice. These people effectively teach one wealth equation (the Slowlane) while they get rich leveraging another (the Fastlane).

When I see financial powerhouse “Suze” instructing people to “dollar-cost average” their mutual fund portfolios, do I listen to her? Hell no. I laugh. When “Cramer” advocates stock in Lehman Brothers because he says it's a good buy, do I listen? No way.

I feel sorry for anyone who follows the investment advice of these people.

I consider these people to be better entertainers than investment advisors. I have no love lost for the poor sap who lost his retirement savings because he listened to some CNBC pundit peddling some hot stock tip or investment advice.

What is wrong with people?

How do you not take responsibility for your financial plan?

And then there's your uncle. You know the guy-the well-educated elder in your life who knows everything, including the molecular structure of dark matter in the Horsehead Nebula. His army of factoids is always ready for deployment: stock tips, the latest and greatest investments, money trends. Yet, lest you forget, he lives paycheck to paycheck.

I call these people “Broke Know-It-Alls”-people who dispense financial, moneymaking advice, and yet are dirt poor. These fat behemoths are walking hypocrisies on how to live a life of health and fitness. Listen to these folks with an entertainment expectation, not advice. Good advice comes from the guy who scores all the touchdowns-not the guy shut out in the fourth quarter! The best quarterbacking advice comes from Peyton Manning, not MJ DeMarco.

Is a Paradox of Practice in Play?

In the game of money, money is the scorecard. If someone tells you how they “scored,” make sure they disclose their real method to wealth, not the illusion concealing the real culprit.

Sadly, it's virtually impossible to get good, practical money advice, because most gurus live a Paradox of Practice. Yes, gurus are rarely rich because of their advice, but rich because they're successful Fastlaners who covertly hide their Paradox of Practice.

These paradoxical metaphors described earlier befit the hypocrisy of the people who you've entrusted with your financial roadmap. You're sold blindly down the river by a ride they've never completed. Meanwhile, they gaze at you comfortably above in their corporate jet, drinking champagne. No one tells you the real, unadulterated story behind their road to wealth, but I will.

The Slowlane roadmap is sanctimoniously trumpeted by best-selling book authors who dispense financial advice through TV, radio, and books. The strategies they sell are a travesty of grand illusions. Do you seriously think these people are rich from their preachings? Or, are they selling you the Slowlane while they get rich in the Fastlane?

Let me hypothesize about the possible wizardry behind their charade.

First is “Suze.”

Suze preaches mutual funds, dollar-cost averaging, 401(k)s. We can absorb Suze in many media: radio, TV, and in any of her half-dozen books. Her grille is everywhere. She's the wretched Slowlane poster child, a high-volume producer of Slowlane junkets spewed to millions. So what's the problem? Ask yourself this: Is Suze rich because she followed her own advice like municipal bonds, dollar cost-averaging and 401(k)s? The probable hypocrisy-the Paradox of Practice-is that Suze's method of creating wealth doesn't appear to be the road she travels, nor teaches. Is Suze Fastlane rich because she leverages the Fastlane roadmap while she pitches you the Slowlane? Is she worth millions because she followed her own advice? Or because she sold millions of books? Is her wealth equation different from the one she teaches? Things that make you go hmmm…

In a 2007 article Suze was quoted as admitting to having the bulk of her wealth (an estimated $25 million) in bonds, primarily municipals. Additionally, she admits that only 4% of her wealth is tied-up in the stock market because “if I lose a million dollars, personally I don't care.” Wow, and yet, this is the vehicle you should entrust to build your wealth? How exactly did Ms. Suze acquire that $25 million nest egg? Because of her advice which champions the stock market, mutual funds, IRAs, bonds, and treasuries? Or, did she use the Fastlane roadmap, amass wealth fast via explosive net income, and then pour her wealth into these instruments?

Yet, her advice for people at the precipice of poverty is that they should invest in the stock market to create wealth when it appears she hasn't. Folks, the rich use the markets for income and wealth preservation-not to create it!

Then there's David. As I thumbed through David's many books, I was inundated with an alarming quantity of Slowlane ilk: compound interest tables, save 10% of your paycheck, stop drinking expensive coffee, and other chronic Slowlane diatribes. Again, the Paradox of Practice rears its ugly mug. Did David get rich from his advice? Or from selling 11 books, over and over several million times, often regurgitating the same Slowlane sludge until you can't take it anymore?

And finally, we have Robert, who hails from Hawaii and has two dads-one rich, one poor. “Double-Dad Robert” bellicosely explains the real definition of assets and that sophisticated investors are deep into real estate. On national television, Robert once bragged about his Lamborghini and I found this extravagant exposition ironic, yet disingenuous. Why? Isn't Robert showcasing the fruit of his teachings? Perhaps.

Robert is a Fastlane success story. He created and built a brand worth millions. But the curious question is this: Which came first? The best-selling book or the Lamborghini? Is there a Paradox of Practice underneath? Did Robert have this status icon “pre-book” by leveraging his real estate teachings? Or did the Lamborghini arrive after selling millions of books? Robert has undoubtedly amassed a great deal of wealth selling books, games, and seminars. Is it possible you're being sold one wealth equation while the architect of the game uses another?

Gurus fill a market need and I don't deny it. However consider this: Are they being truthful about their paradox and their magic potion? Are they rich because of what they preach, OR what they sell? Once you're familiar with Fastlane mathematics, it should become clear to you which gurus are likely guilty of the paradox. Is the underlying mathematical equation which governs their teachings the same one that made them rich? If the "do as I say" doesn't match the "do as I do", you should be suspicious.

What makes me different is this: The Fastlane concepts in this book gave me financial independence. I already have financial freedom-the nice house, the sports cars, and the flashy rapper credit card. I don't need this book to get me these things. I also confess this Fastlane disclaimer: This book has the power to make me wealthier because it leverages the same wealth equation I teach you. In other words, the "do as I say" matches the "do as I do."

Slowlane Gurus Admit Failure

On a Slowlane financial radio show, a caller sought advice: In a few months the recession destroyed more than 50% of her savings, which had taken her nearly 11 years to accumulate. The Slowlane guru's advice? A palliative “Stick to the plan.” Recommit. Rebuild.

In other words, my crappy plan has failed you, has taken 11 years to fail you, yet stand by it. Hope the economy rebounds. Hope the economy never sees another recession. Hope, hope, and hope. And yes, please buy my newest book, Rebuild …

Economic recessions expose the Slowlane as a risky fraud with lifetime ramifications. Since these gurus make their rich livelihood selling the Slowlane roadmap, they need you to believe it works. Their wealth comes from your belief. Despite the current recession's masterful expose, the Slowlane illuminati will never admit that their strategy is woefully inept, and instead they have deviously recalibrated their message to conceal the truth: They continue to spew the same failed rhetoric by writing new books, with new titles and new platitudes. Titles like:

Rebuild Your Wealth . .
Start Over …
Recommit …

Notice the shift in language, exposing the truth: If the plan is so good, why do you need to “rebuild” or “start over?” If the strategy worked, such words wouldn't be necessary. For the charade to continue, the gurus need to reinforce the strategy with new books selling the same old shit! And the bigger question: Do you think the gurus need to “start over” or “rebuild”? Of course not! They don't use the plan they sell! They operate in an entirely different wealth universe not predicated on uncontrollable limited leverage.

Chapter Summary: Fastlane Distinctions

• Take advice from people with a proven, successful track record of their espoused discipline.
• Many money gurus often suffer from a Paradox of Practice; they teach one wealth equation while getting rich in another. They're not rich from their own teachings.