The Billionaire Eliminating Diseases
Episode 19
Hello everyone - Greetings from Austin! Last weekend my wife and I spent the weekend at a resort in a remote town in Texas. It was our first “vacation” in 2020 and it was so relaxing. Here’s a pic:
On to the newsletter! Here’s what I got for you this week:
No evictions for 2020
Naveen Jain: the billionaire working to eliminate diseases
The cheapest and most efficient way to avoid failure: Learn from others
🏡 Real Estate News of the Week: No one can be evicted!
This week the White House issued an order through the CDC that declared evictions during a pandemic a national health hazard. In effect, meaning that no one can be evicted for the rest of the year. Now there’s a lot of caveats behind this such as income level, proof of being affected by COVID, etc.
As a multifamily real estate investor, it would be very easy for me to say that this is a terrible move. But life is more nuanced than that. In fact, I think this is one good idea, although we need to do more. Can you imagine evicting someone and leaving them homeless because they lost their job due to factors that are out of their control? It’s heartless. Overall, I think this is a net positive for society.
However, there’s a couple important points to think through:
These landlords still have bills to pay. They need to pay the mortgage. They need to pay for all the property expenses. They need to pay their employees. If these landlords, many of whom are small mom-and pop landlords, can’t make these payments we will have a scary snowball effect that will effect our citizens, the capital markets, and the broader economy.
The moratorium doesn’t eliminate rent payments, but kicks the can down the road. If someone is currently laid off and was already living paycheck to paycheck how do we expect them to make “catch-up” payments when they get their job back again? They will have a mountain of debt when they get back to work. The amount of stress this puts on a person would be unbearable.
While this move will potentially save lives and prevent homelessness over the course of the next few months, what happens when landlords can’t cover their expenses — Do they default on their loans? What happens when these moratoriums expire and evictions begin — do we see an unprecedented wave of homelessness in 2021? These are all important questions that need to be thought through and answered.
These are all extremely important issues and decisions that will be made this month and the rest of this year. Decisions that will impact our citizens, markets, and the health of our country. I fear that there’s not enough intelligent decision making and we’re setting ourselves up for a potential disaster.
📺 Video of the Week: Naveen Jain
Naveen Jain has a goal to eliminate human disease.
Who is Naveen Jain? Naveen is an Indian immigrant who came to the U.S. in in the late 70’s. His first big hit was InfoSpace, founded during the dot-com era. InfoSpace provided phone directors, maps, game, and stock market info to websites and mobile device manufacturers. At one point, his net worth was almost $8B. But then came the dot-com crash.
There was lots of controversy from employees feeling they were misled, Naveen selling shares of the company after hyping up the stock price, and even questionable accounting practices. Because of these questionable and potentially unethical decisions he ended up paying over $100M in settlements from lawsuits and was ultimately fired from the company he founded.
After InfoSpace he went went on to continue founding companies and creating new ventures. These included a background information website, a company that is mining materials in space, a genomics testing company, and others.
There’s a lot behind this guy. Is he legit? Is he a fraud? Honestly, he might have been a fraud — but, I have no idea. And I’m not here to judge. What I am here to do is learn from people, hear about their experiences, and soak up as much knowledge as possible from them. This interview was a fascinating one to do just that.
Again, I’m not going to make judgements on his background. But there’s a few things I learned from him in this interview that was helpful for me — he's super motivational, a student of history, and makes you want to get off your ass and start working hard!
📱 Tweet of the Week
It’s impossible to live life without making mistakes. But as Buffet said, “it’s better to learn from other people’s mistakes as much as possible”.
This is why I love reading so much — we can learn so much. And if we are perceptive enough we will learn from other people’s mistakes and increase our chances of success.
Have a great Sunday,
Rohun
Texas looks nice!