'The Hub' with Michael Allen sponsored by Manpower Richmond
Welcome to "The Hub with Michael Allen," the podcast that dives deep into the stories of community leaders and business owners who are making a difference. Join your host, Michael Allen, as he uncovers the untold narratives, challenges, and triumphs of those shaping their communities.
In each episode, Michael sits down with remarkable individuals who have dedicated their lives to improving their neighborhoods, towns, and cities. These community leaders are passionate, driven, and committed to creating positive change. Whether they are activists, educators, philanthropists, or civic officials, they all share a common goal: to build stronger, more vibrant communities.
"The Hub" also showcases the journeys of business owners who have turned their dreams into reality. From small-scale startups to well-established enterprises, these entrepreneurs share their insights, experiences, and lessons learned along the way. Michael delves into the unique challenges they face, the strategies they employ, and the impact their businesses have on the local economy and society at large.
With engaging conversations and thought-provoking discussions, "The Hub with Michael Allen" provides listeners with valuable takeaways, inspiration, and actionable ideas. Each episode offers a glimpse into the minds and hearts of those who are actively shaping the fabric of their communities, providing a roadmap for listeners who want to make a difference in their own lives and surroundings.
Tune in to "The Hub with Michael Allen" and join the conversation as we explore the stories of community leaders and business owners who are leaving an indelible mark on the world around them. Get ready to be inspired, motivated, and empowered to take action. Together, we can create a better tomorrow for everyone.
Sponsored by Manpower Richmond.
'The Hub' with Michael Allen sponsored by Manpower Richmond
Ep. 24 | The Bitcoin Revolution: Understanding Digital Currency with Vista Investment Partners
The Hub Podcast with host Michael Allen, sponsored by Manpower Richmond – visit mprichmond.com
In this episode, Michael sits down with Brett Guiley and Matt Golliher of Vista Investment Partners for a powerful conversation on the future of finance and how digital assets like Bitcoin are reshaping the investment landscape.
The episode kicks off with timeless investing wisdom – including Brett’s breakdown of the “Rule of 72,” a simple way to understand how long it takes your money to double at a given interest rate. It’s a reminder that the earlier you start, the more time you give your investments to grow through compound interest.
Brett and Matt also stress the importance of building a solid financial foundation: start with an emergency fund that covers 3–6 months of expenses. Once that’s in place, you can confidently begin investing for the long term.
Things get especially interesting as the conversation turns to Bitcoin. Unlike traditional assets, Bitcoin has a hard cap of 21 million coins, creating a unique form of digital scarcity. Because of this, they see it not just as another crypto, but as an entirely separate asset class – one with the potential to act as digital gold that’s transferable in real time.
They also share why their firm launched Orange Horizon Wealth, a service tailored specifically for clients interested in Bitcoin-focused financial planning. It’s a growing area of interest as more people explore how Bitcoin can fit into a long-term investment strategy.
Whether you’re new to investing or curious about where digital assets fit in, this episode offers real, actionable insight from two experienced financial advisors.
👉 Ready to start building your future? Press play and take the first step.
Disclaimer: Vista Investment Partners is an investment adviser registered under the Investment Advisers Act of 1940. Registration as an investment adviser does not imply any level of skill or training. The oral and written communications of an adviser provide you with information about which you determine to hire or retain an adviser. For more information please visit: https://adviserinfo.sec.gov and search for our firm name.
This presentation has been provided for informational purposes only and is not intended as legal or investment advice or a recommendation of any particular security or strategy. The investment strategy and themes discussed herein may be unsuitable for investors depending on their specific investment objectives and financial situation. Information obtained from third-party sources is believed to be reliable though its accuracy is not guaranteed. Opinions expressed in this commentary reflect subjective judgments of the author based on conditions at the time of publication and are subject to change without notice. Past performance is not indicative of future results.
Welcome to the Hub Podcast recorded right here in Richmond, indiana. I'm your host, michael Allen, and on the Hub, our mission is to share stories of people making a difference in our region. In addition to hosting the podcast, I work with a wonderful team of staffing professionals at Manpower. Manpower is helping companies all over East Central Indiana find staffing so they can continue to grow and thrive. Find out how we can help your company at mprichmondcom. With us on this episode of the Hub is Brett Guiley and Matt Goyer. Both are with Vista Investment Partners here in Richmond Indiana. Brett and Matt, welcome to the Hub.
Speaker 1:Thank you, great to have you here today I go to church with one of your newer investment partners, jonathan Camps, and he was super passionate about asking me to get you guys on the hub. He thought that what you had to say was extremely important, not for just promotional reasons, but just things about investments and what we'll get into cryptocurrency. So and I was I'm glad we could work it out today and it's always fun to have like two really bright guys on the hub super smart guys, I don't know about that, but thanks.
Speaker 1:But and I think the timing is kind of cool with some of the stuff For our followers, you know, you know um, you know we're here in uh mid-april and some things have been going on with the market. It's been kind of interesting and kind of got people worked up a little bit. So but before we get into that, I would like to start with uh tradition we have here on the hub and I'm going to ask both you guys, uh, what was your very first job? So I'm interested in employment. You know, given that I'm in to ask both you guys, uh, what was your very first job? So I'm interested in employment, you know, given that I'm in the staffing industry and manpower. So, brett, we'll start with you on this one.
Speaker 3:So tell us about your first, very first job, where you got a paycheck and how to pay taxes so I grew up in rural southern missouri, okay, and the town that I went to high school and was called farmington. So that should give you a good indication as to the type of area I grew up in.
Speaker 3:But the little suburb of Farmington that I grew up in was called Doe Run and one of my friend's parents started a restaurant called the Plantation House, and so I became a bus boy and I remember the job interview. I went in and the restaurant manager and the cook asked me well, how old are you? And I said, well, I'm 15 and a half. And they both thought that was hilarious because I had to throw the half in there. So that was my first job.
Speaker 1:Yeah, so how much did you get paid? Do you remember?
Speaker 3:Not very much, but what I didn't get paid I made up for in eating food.
Speaker 1:Yeah, yeah, yeah, yeah. I had one of the restaurant jobs and to this day I'm still carrying around weight from that job. So how about you, matt?
Speaker 2:First official job with W-2 and taxes withheld and everything. I grew up in Cambridge City so I became a bag boy at Cutshall's Grocery and I was there for about two years, I think the last couple of years of high school, and I know it was minimum wage, but I don't know what that was at the time $5.25 maybe? Yeah, I don't know.
Speaker 1:I mean when I went to work fast food in my senior year in high school, I minimum wage was like like two something an hour. It's like that doesn't seem like a lot of money. At least right now it doesn't. But uh, yeah, so that's great. I mean any. Uh.
Speaker 3:When you look back at just doing those first jobs, any any lessons learned, you think just, even with the first experiences, I saved my first paycheck and at the time this was in the early 90s bought a pair of guest jeans with the entire paycheck and I look back on that and I'm thinking that was ridiculous, but that was my first freedom purchase from my folks and I think about that as starting my entrepreneurial journey that we're on now.
Speaker 2:Yeah, yeah, I would say you know I had quote unquote jobs before making money, bailing hay, doing things like that, but that was really the first job where I had consistent income. You know managing a bank account, so I somewhat consider that job my foray into adult financial life. And then you know everything related to being on time. You know everything you have to do to have a job for two, two and a half years, right, right.
Speaker 1:Well, it seems like my memory that I have the most is I would just blow through the money. Memory that I have the most is I would just blow through the money. So it was been a lesson I've tried to pass on to my kids, not not to do that so that. That was, I guess, one of my first lessons learned on a personal level. So what, uh what, contributed to each of you seeking a career in investment? I remember planning.
Speaker 3:Yeah, I remember always being interested in markets. Um, like many young boys and girls my age, I started out collecting baseball cards and got the pricing guides and learn things can go up and down in value and, uh, quickly developed an interest in the stock market. Um, I was fortunate to save some money, probably from one of those jobs that I had early on, and invested $250 in a mutual fund right before the stock market dropped in 1987. And that was my first investment. So I would call up a 1-800 number and listen to type in my account number and listen to the value every week and I would keep track of it on a yellow pad. And my, my sisters remember me doing this and they even brought it up this weekend when I saw them and and so I left that in there and to for about 12 years and then sold that to buy my my now wife's wedding ring. So that was my first foray that I thought, well, maybe I'm pretty good at this.
Speaker 1:Yeah, that's cool, I mean, and you were how old.
Speaker 3:At that point I would have been probably about 10 or 11. Wow.
Speaker 1:Wow, that's amazing.
Speaker 2:How about you, matt? Somewhat similar. I went to Indiana University in Bloomington and I spent the first couple of years there really having no idea what I wanted to do for a living. But during my junior year I started taking more finance oriented classes and I'd always been interested, even before that, in economics and I'd done a lot of reading on my own time, and so the last half of my undergrad was more finance focused in terms of my class load, and I found an opportunity at West Point in Indianapolis. That was my first job out of college and I was fortunate enough that I liked it enough that I decided that's what I wanted to do with my turn my living. So it's been an interesting journey. You know, as a financial advisor in multiple capacities for different types of firms, I've seen some different angles of the industry, but that's how I got. That's how I got started.
Speaker 1:I was lucky that it worked out so, if I'm hearing correctly, both of you went right into it right away as your career. So how was it? I want to go back in a minute and ask you a little bit about your personal history. But how was that being a young person trying to advise people on on financial planning and investments when, just by, you're just like your young guy? So I mean, I would think if you could run across some potential clients to say, well, what do you know? You haven't been around long enough to even know, know this business, and so how did you run across that? Or or how did you manage that? Is that a fair question? Or?
Speaker 2:yeah, I think so I'll start. Um, that was a recurring thing that happened the first, I'd say, five years of my career where I graduated college, so I was 22. I looked like I was 15. And I remember, after West Point, my next transition, I decided to go to a bank program, first Merchants, and I remember meeting a new potential client for the first time in the lobby and walking to my office and a handful of times one of the first things they said to me is how old are you? Yeah, and so I had to work to earn the credibility.
Speaker 2:And you know, I think for any young professional there's a degree of imposter syndrome, and I definitely had that. You know who? Who am I? Some 20 something year old who presumes to advise this successful business owner on what to do with his million dollar portfolio. But just with time and experience comes the conviction that you know I am a knowledgeable professional and this person could benefit from my help. It's their decision whether they want to take advantage of that or not, and so over time that just continually got better. But that was certainly a dynamic early in my career, I'd say.
Speaker 1:How about you, Brad? Did you run into that any?
Speaker 3:Definitely so. I started my career in 2000 with Merrill Lynch as a trainee. I started my career in 2000 with Merrill Lynch as a trainee. And when you do that you don't realize that when you're coming out of you know, I came out of an undergraduate education where I had a lot of business courses and graduated the business degree. That doesn't necessarily qualify you to be a financial advisor. So you have to take all sorts of industry tests and that still doesn't qualify you to handle some of these money. So you have to take all sorts of industry tests and that still doesn't qualify you to handle some of these money.
Speaker 3:And I remember early in my career there being a bullpen in Dayton of advisors that were some of them mid-career, that were making a career transition and this is in the tech bubble days who had come out of Wright-Patt Air Force Base and was in his 50s, telling somebody I think this stock is a good value and he said the price and my mouth fell open because I couldn't believe that. You know that was good advice and in fact it wasn't. And then the market took the first tumble of my career. So I definitely had that syndrome where I shouldn't be here. And you know people didn't necessarily trust me right away, so it took I would say eight to 10 years before I gained enough confidence and enough um business acumen to where it was like I've seen this before.
Speaker 1:You can trust me, mm-hmm. So that makes it, uh, you know that's that's a long period of time to try to get you know, get your your groove in the end and I'm sure with that you know the the income isn't what. Maybe you wanted it to be early on than what it is. You know you get later in your careers or whatever. I'm sure there's maybe a correlation there a little bit, I think. So, yeah, so one thing that I wanted is to go back on and you've shared a little bit of it. But, um, maybe, matt, we can start with you. Just share a little bit for our followers. You know a little about yourself growing up and just kind of your some of your personal story yeah, so I think I mentioned previously I grew up on a farm in Cambridge city.
Speaker 2:Uh, I'm a triplet, so uh, matt, dan and Joe are our names, and then I have five older half siblings, so big farm family. There's a lot of Goliards running around Wayne County. Uh went to Hagerstown for elementary high school everything like that played football, ran track. Uh went to IU for collegeu for college, and uh, I'd say my biggest hobby is probably reading. I've always been an obsessive reader, which, um, plays into the story of my career a little bit, which we may get into, but I read that you gave me this article to read and in that article I remember you.
Speaker 1:you mentioned reading a lot of books on the topic of cryptocurrency and Bitcoin, so we can touch on that a little bit later. How about you?
Speaker 3:The short version is as I mentioned, I'm originally from Missouri, went to the University of Evansville and that's where I was fortunate enough to meet Shannon Van Vliet, who I've been married to for 25 years, in June, and we have three children Jack, lauren and Addison. All three are not young anymore 22, 20, and 18. And Jack is getting ready to graduate with an economics degree from DePaul. Lauren is studying occupational therapy at St Louis University in Missouri, close to where my family is from, and Addison is a senior at Eaton High School in Missouri, close to where my family is from. And Addison is a senior at Eaton High School in Ohio and going to be studying speech therapy at Western Kentucky University. And I've been fortunate enough to become a business owner, own Vista Investment Partners and have a great team of people that work with me. And then we also, in conjunction with Matt, launched Orange Horizon Wealth which we can get into a little bit later, which is a subsidiary of Vista Investment Partners, and we started that last May.
Speaker 1:Okay, All right. So how long has Vista been your company? How long have you? What year did you start?
Speaker 3:So, as I mentioned, I started my career in 2000. In 2006, we moved to Raymond James from Merrill Lynch, and Raymond James gives you the flexibility with your career that if, at any point, you don't want to become, you don't want to be an employee advisor, but you want to be an independent advisor with them, you can do that.
Speaker 1:So in 2018, we pivoted our business and became an independent division of raymond james and named our llc vista investment partners okay, investing money is pretty scary for people because they're afraid they might lose it and uh, but I don't think stuffing it in a mattress is probably a productive method of savings. And so how do we kind of get started in that? You know, as far as investment strategies and why it's important to be thinking about that, I've known people that are just totally terrified to put anything in investment, so they just hold on to their cash and they've just had it in pretty low-yielding savings accounts which probably aren't even barely keeping up with the rate of inflation, maybe even under that, I don't know. So I don't know where we launching is for this discussion. But, um, you know it, where do we get started?
Speaker 1:Is it ever too late? Is it ever too early? I think the answer is probably no, it's not. But, uh, how can we start that conversation about? Just about getting started in that and what you should, what people should, be thinking about, I guess yeah yeah, I.
Speaker 2:The first point I would make is that in the current monetary system that we've all grown up in for the last 50 some odd years, the challenge for investors is that investing is not optional because the currency loses purchasing power every year. Where, in a scenario where you could just save money, that allows you the luxury of sitting back and only making an investment if and when you decide that that's a prudent thing to do. And in cases like that, you tend to only invest your money or deploy your money at risk in investment ventures that you have a deep level of knowledge in and where you trust and know the people involved. That's not the case currently, where you know. The other point is that there is no, because you mentioned that people are scared to invest in the stock market because it's risky, but there is no risk-free thing you can do with your money.
Speaker 2:You know, if you had $100,000 and you did put that in the proverbial mattress, 10 years later, let's say, we have an inflationary decade and the price of everything is doubled, and so you lift up your mattress. You look, all of your $100 bills are still there. So two things are true at the same time you didn't lose any money and you lost half your money. Or, more precisely, you didn't lose any currency, but you lost half your money. Or, more precisely, you didn't lose any currency, but you lost half your purchasing power. So a big part of what we do for clients is try to help them strike the smartest balance between market volatility risk and currency debasement risk, and that's where I like to start the framework for investing.
Speaker 1:As far as I had talked to guys a little bit before today and we had I kind of unscientific range, but I was thinking about, you know, maybe age 20 to 30. I mean, you were 10 years old. I don't think that's the norm, but maybe, like I'm thinking, 20 to 35, 35 to 50, 50 to 65, and then 65 and older. I mean I don't know. Surely there's different things that you look at based upon where a person is in their time of life. I mean, what about those different ranges? And as far as advising people questions, you may ask those folks, as far as you know, ready to make some investments at those different stages. I mean they may be starting at one stage and as they go on, you make changes to their portfolio. So, what's some of the starting points for younger investors maybe who started there?
Speaker 3:When we talk to somebody for the first time, we talk about critical financial events, and that's a key term for anything where money is involved. So that could be retirement, that could be loss of a loved one, an inheritance, a job change, a special purchase or the first purchase of a home, or planning for college, those types of things. So once we establish what we are saving and investing for, then we can start a plan as to why we're going to use those capital dollars and put them at risk. As Matt said, and typically the younger a person is, the more time they have for that money to grow there's a rule in finance we call the rule of 72, which we'll talk about a lot of times, and that means that if you're able to get 10% return on your investments generally speaking, 10% a year, generally speaking your money should double every 7.2 years. And so if you think of your life and in your investing lifestyle in terms of seven to 10 year increments, you can start to plan out.
Speaker 3:Okay, if you put money to work in your twenties, how many 7.2 year periods do you have until you're going to need the money, potentially at retirement? And so then, doing a good job of assessing somebody's risk tolerance, you know. If they're going to panic when the market's down 10%, we might go ahead and reduce the risk in the portfolio by adding more other asset classes, such as bonds, cash, money markets, cds, treasuries, things like that, where, if they can stomach those 10% volatility up and down or 20%, you know we're going to have more at-risk assets such as the stock market. The stock market, you know, roughly averages 10% a year. So when a person's in their 20s they might be able to stomach 100% of their money in the stock market going up and down. If they're 65, 75, 85, they may not want that risk because they may have designs on what they need the money for, either to help supplement retirement income, to leave a legacy to pass on to the next generation.
Speaker 1:I'm sure you've met with potential clients and you know they want to do something. But they come in they say, or someone talks to you and say I really don't have any money that I can invest. So I mean, how do you show them that maybe they do? I mean, I'm sure, because, well, I got this house payment, I'm trying to get this car payment and I got you know, and uh. So I think a lot of people could sit there and look and like I don't have I can't I mean, I know I need to invest, but I really can't based on what I see.
Speaker 1:Do you, do you have conversations like that with people?
Speaker 2:Yeah, and it's fairly common, I would say, for clients to ask us to meet with their children, their young adult children, when they're just getting started, and so that's a fairly common conversation that both of us have had. For a younger investor who's thinking about starting to invest and I think about that, for the phrase I use is investing from a strong foundation where the first thing I like to see is that they have an adequate emergency fund and rule of thumb. You'll often hear three to six months of expenses, but the actual amount of money varies just based on the person. But the critical point is that when investors you know a young investor they get their first job where they're earning, you know their first real paycheck and they're considering starting to invest some of that money.
Speaker 2:If they do that without first building up some sort of savings, then the very likely result is that they're not going to be able to invest that money for the long term. They're going to have to sell it if and when they need it, and they may not have a good price when they sell that. So as long as they have some savings, then they're in a position where they could start $50 a month. They could open an IRA or a brokerage account and you can start investing. You don't need, you know, a hundred thousand dollars to start making investments. You can do it slowly, over time, and that's that's the most important thing is just being consistent and having your money invested in the market and being in a position where you're not going to have to be a forced seller of your long-term investment.
Speaker 1:So what are some of the key factors that you consider with clients before making investments? What are some of the things I mean? You kind of hit on it, I think, but is there any more that we can? Elaborate in that area.
Speaker 3:We try to do a good job of getting to know the person first, getting to know their investing history, if they do have one, and what they did emotionally when the last downturn came. Did they have to pull money out? Did they have an unfortunate event that caused them to have to spend it all? Do they have a scarcity mentality with their money or an abundant mentality? Are they a giver? Are they a saver? It's really important on the front end that we interview them before we ever make an investment recommendation. So that, to me, is the key to a starting foundation. And back to kind of the young person.
Speaker 3:It can be very daunting to say, oh, I have to save all this money, hopefully for the rainy day for retirement, wanting to say, oh, I have to save all this money, hopefully for the rainy day for retirement. In some ways it's like a mortgage in reverse, though. You pay off a mortgage you know many times, traditionally 30 years every month for 30 years, 360 payments, and that seems very daunting at the beginning. But after a while you kind of get it on autopilot and you don't even think about it and all of a sudden, sudden, hopefully, the home's paid off. Same way with investing you can start and just auto automatically commit to an amount. All of a sudden you wake up one day in the market which is still the greatest wealth creator in the universe, in my opinion, the stock market. All of a sudden you have a nice little nest egg, hopefully, sure mortgages are tough because you end up paying a lot for your house.
Speaker 1:Do you have conversations with clients about alternatives to mortgages? I mean, is that even the thing that comes up in your conversations, or not?
Speaker 2:Yeah, I would say one common thing that comes up is a client has a mortgage and then they have, you know, windfall of money, whether that's an inheritance or something else.
Speaker 2:And it's a very common problem we help clients with is helping them weigh the consideration on do I pay off my mortgage or do I invest the money. And I'll commonly give two answers where, on paper, mathematically, if you can invest money, where you're confident that your long-term rate of return is higher than the interest rate on the mortgage, then on paper it makes sense to invest the extra money. But I also try to acknowledge that there's a value to owning a home, free and clear, that does not show up on a spreadsheet, so it's not, you know, for that client. It's a balance of those considerations and we help them weigh that and try to make the best decision on that. Unfortunately, especially for young people who wish to acquire a home, if they want to do it before they're 40 or 50, for a lot of people there is no alternative to getting a mortgage. That's kind of how the system works.
Speaker 1:It was maybe different when the rates were lower than they are now. I mean, the last time that I got a mortgage the rate was under 3%. That seems like free money today. Maybe in some ways it is so now to pay. You know what was even higher? I think right now the rates are 6% to 7%. So that makes it tough to think about paying that much interest when we were had a really long period of time where the rates were really very low. Do you think we'll ever get to those kinds of numbers again?
Speaker 3:I personally think there's a possibility. We will.
Speaker 1:Okay.
Speaker 3:I think we, you know, that kind of goes into our economic thesis, which which I, I can tell Matt wants to weigh in on, as to where we are in the interest rate cycle and where we could potentially go yeah, so our talk today.
Speaker 1:We're not really in a situation where we can be telling people a lot of specifics about what they should do with their money today. That's not part of what we can do today, correct? So I'm trying to ask questions where we don't get into super specifics. Um, how do economic indicators influence decisions with your clients? Uh, you know, recently, um, there's a little president trump had put all these tariffs on and then the stock market didn't like that at all and I'm sure that, um, people were getting like maybe super nervous um about that. I mean, what were those kind of? How do you, what are those conversations like, if you can share, or or how do you, how do you discuss those with your clients to try to bring them at ease and not have them just freak out and want to?
Speaker 2:just sell everything.
Speaker 2:Yeah, I would say in general for economic indicators, the main part of our job is encouraging clients to take a long-term view, because in any given year there's going to be scary things that happen and at the time you know if it's the story of that news cycle. It may seem like the end of the world, but ultimately you zoom out and you're not even going to remember what that thing was you were so worried about five or 10 years ago. And you zoom out and look at the stock market and, although there is volatility, you'll find that, especially over the last 50 years in modern equities markets, the stock market has climbed a wall of worry and that's how it generates the return, where volatility is the price we pay for that 10% or so average return. So economic factors and indicators are definitely something we look at, but it's not something that we want clients to be making their investment decisions on most of the time and we we encourage them to think through it that way as well.
Speaker 1:What are some of the common mistakes that that investors make? I mean there's some do's and don'ts that you try to encourage your clients not to do when they come to you. I mean one of them, I think, is look toward the long-term. You just said that, but is there any other things along that realm?
Speaker 3:There are definitely exceptions to the rule, but people will always tell you about their winners in the stock market and never their losers. I've never met a day trader so far that's still day trading six months or a year later because it's tough. And it's tough to have the intestinal fortitude to be able to sell when everything says you shouldn't sell, and vice versa. So holding on to your positions that you have conviction in in the face of volatility is a difficult thing. People want to sell because that's the emotional response that they have and that's behavioral finance. When things like the market volatility spikes up because of tariff news. The market volatility spikes up because of tariff news.
Speaker 1:So pulling things out early, I think is probably the biggest one that we counsel people on and hold their hand on the most. There are some stocks that are really good about paying dividends and some that aren't. Why is there a difference there? What's? What's the difference that one that would be considered a one that pays well with dividends and one doesn't is that? Is that a dumb question, or I don't think so.
Speaker 2:I don't know if the in general, you know the dividend paying stocks are going to be the more established companies. Non-dividend paying stocks typically are more growth oriented or in earlier stages of their business life cycle. So if you think about you know if you're in charge of a company, you have a fiduciary duty to maximize value for your shareholders. So when shareholders give you money, your job is to earn them a rate of return and for that business, the question that they have is for the cash that they have, is there a productive way to deploy that in order to generate a return for shareholders? Growing the business, upgrading equipment, whatever that may be, and to the extent that there is, those companies typically, rather than paying out cash via dividend to shareholders, will reinvest that money in the company to grow faster. In a case where there aren't those opportunities to grow, the prudent thing to do as a fiduciary or one of them, is to give the cash back to the shareholders and that's what we call a dividend.
Speaker 3:I would just add to that one of the strategies and items that I look at for companies that pay dividends is how frequently do they increase that dividend? And the sign of a healthy company is if they raise their dividend regularly. So at minimum, what I'm looking for is three times out of the last five years have they increased their earnings and have they increased their dividend that they're paying back to their shareholders?
Speaker 1:Is it? I don't know if I can ask this question, if you're allowed to answer it. Is it typically wise to go ahead and, if you get those dividends, just have it reinvested in that stock? So you really don't see it and now you're just you're keeping increasing your amount of stock that you own in that company. Is that, is that a fairly good practice to have, or is that something that we can talk about?
Speaker 3:Depending on where you are in your investor life cycle. If you're in your twenties, thirties, forties, fifties and you're not needing distributions, absolutely reinvesting, it makes sense. But it might be a meaningful piece of your retirement equation to take those dividends as cash flow when you retire.
Speaker 1:Okay, all right, in your line of business. I mean, sometimes I see these commercials and they're like uh as far as uh in the investment world and and sometimes they make villains out of investors for making money. But I mean you can't do it for free. So I mean, so how, how are you guys typically, where's your? Where do your? How do you make money at what you do? At the same time, you know, be looking out for your, your, um, your client's best interest. I mean cause that. I mean that just doesn't apply to you guys.
Speaker 1:Um, I mean um, any business owner. You're not going to be in business if you don't have a way to earn money for yourself. I mean at all. But how, how does that work? Does that work? I mean, I just see, it seems like I see that theme in in in the investment world, maybe more than others, as far as the way that um advertising after they use advertising to try to say, well, you work with us because we don't really take any of your money in and this other guy's just trying to graft you. So I mean, if you don't mind sharing that a little bit, how that works.
Speaker 3:This is a good question and one that we get quite a bit In our business. We are considered a hybrid registered investment advisory firm. Well, what's the hybrid part mean? Well, we're actually registered with two different entities FINRA, which we work with, a broker dealer, and so that's our traditional business, where people call us up and they say, hey, I want to own X one. Also in the broker dealer, we can offer a suite of various insurance based products, such as life insurance and annuities. So that that is one section of our business and we will definitely tell people that we are working with them as a broker at that point. Another side of our business is our registered investment advisory business governed by the Securities Exchange Commission, and that is typically a negotiated management fee based on the assets under management and the strategies that we employ for clients.
Speaker 1:Okay, the good answer, the. I had something I was going to ask you, maybe to come back to me, but I guess I want to move on to kind of what's more of an interesting or hot topic today as far as Bitcoin, cryptocurrency. So for those that maybe don't understand, I mean, what is cryptocurrency and even, furthermore, what's the difference between Bitcoin and other cryptocurrencies? It's kind of a wide question, but I'll try to do a speed run on it and start there.
Speaker 2:So in 2009, a digital monetary protocol called Bitcoin was released by someone or a group of people named Satoshi Nakamoto. No one knows what he, she or they real identity is, but it was recognized by very few people as significant and important. It had no monetary value whatsoever. There were websites where you could go on and solve a CAPTCHA and it would give you five Bitcoin, which today would be worth $400,000. So it started its life as a fringe experiment in monetary technology. But the reason it was significant is and I alluded to this before where, for thousands of years, gold was the preeminent monetary standard, and the biggest reason for that is that it was the commodity that, in all of human history, we could find that was hardest to inflate. The supply of everyone in the world decided gold was the best money, but because it resisted inflation the most, it just was the case that those who stored their wealth in gold kept their wealth. Those who stored it in inferior assets over time lost their wealth.
Speaker 2:The problem is, with the advance of telecommunication technologies like the telegraph and the telephone at the turn of the 19th century, we were able to send payment information at the speed of light around the world, but gold can't move that fast. So the global monetary system evolved, where you deposited your gold with a trusted intermediary and you exchanged IOUs for gold, which can be sent at the speed of light across telecommunication lines. The problem with that is, if you want to inflate the gold supply, it costs energy to do that and there is no way around that cost. It costs nothing to inflate the supply of IOUs on gold. So, predictably, the supply of IOUs grew beyond the amount of actual gold that was there and every central bank in the world defaulted on its promise to redeem its currency for gold. What Bitcoin does is it introduces the same scarcity that's enforced by the unfakable expenditure of real world energy in a digital asset. So it is gold that can be sent across telecommunication channels and that's why it's an innovation.
Speaker 1:I mean, if you bought gold today, though, you wouldn't they wouldn't send you bars of gold to your house, right, I mean, or maybe I get it. Who's the Senator or Congressman that had all the gold in his house?
Speaker 2:Oh, I forget the one who got in trouble. Yeah, yeah.
Speaker 1:But uh, I mean, but, uh, I mean, but some people do buy that, but it's just isn't, it's just held somewhere and I don't know. I mean, I see advertisements all the time. People want you to buy gold. Still to this day with um.
Speaker 2:With gold or bitcoin. Um owners can choose to custody it themselves, in which they're responsible for it, or they can outsource that to a trusted custodian so back to um, in which they're responsible for it, or they can outsource that to a trusted custodian.
Speaker 1:So back to Bitcoin and other cryptocurrencies. So we have Bitcoin, but then we have all these other currencies out there that people are buying, and it's all kinds of prices and whatever. I mean you guys are primarily or only into Bitcoin. Is that right? As far as financial advising, is that correct? Only Bitcoin, okay, and that's. I think that involves Orange Horizon Wealth. Is that part of?
Speaker 1:you know the subsidiary of your company. So how, how do you I mean, if people, how does that work? I guess I'm trying to. I'm at a loss of words because I don't know if I totally understand, but I mean. So what does um, that subsidiary do? As it relates to Bitcoin and people making investments, I guess?
Speaker 2:Yeah, the orange horizon wealth is a division of Vista investment partners that focuses on Bitcoin centric financial planning and wealth management.
Speaker 2:So, for all of Vista's clients that we've had before Orange Horizon, we educate them about Bitcoin and we can offer it and do offer it to them in a variety of ways, but the opportunity that we identified is that a massively underserved niche of clientele all throughout the US who have discovered Bitcoin, adopted it and, in their mind, view it as the most important asset that they hold.
Speaker 2:The challenge is, when an investor like that needs a financial advisor, the most common experience that they come up against is that that advisor has no idea what Bitcoin is and is not able to offer them any advice around it or, even worse, potentially bad advice around it. And so Orange Horizon really you can think of it as a separate brand of Vista one thing, but orange horizon focuses on helping bitcoiners, as we call them, uh, in all areas of traditional wealth management, portfolio management and financial planning, but delivered from a team of advisors that has a deep understanding of bitcoin because, uh, on a personal level, you've invested a lot of energy in trying to learn it and and uh uh, be an expert on it, and so, uh, I don't know, um, where that fits.
Speaker 1:You know, when you talk about that and financial planning, I'm still a little, a little unsure of of how that becomes part of your part of your portfolio and what you do with it. I mean, is it just making it a percent of what you're invested in and trying to diversify by having some in Bitcoin, or is it you're helping people transition everything into that? I think, in part of the article that you wrote that you gave me, that you said, apart from your articles is I talk to investors almost every week now that fit the following description they're within 10 years of retirement, they have seven figures of investable net worth and have more than 50 percent allocated to Bitcoin more than 50% allocated to Bitcoin. So is that the part where you're helping them? You?
Speaker 2:know, do that 50% into Bitcoin or the most? From an investment perspective, probably the most important aspect of Bitcoin is that it is the first asset with an immutably fixed supply. So with any other asset, as the price goes up, the incentive to create more of it goes up. There are currently deposits of gold all throughout the world that would not be profitable to extract from the ground and, from a strictly physics sense, gold is infinitely abundant. The challenge is how much does it cost you to acquire the gold, and is the market value of that gold higher than the cost to acquire it? Sure, so if the price of gold doubled tomorrow, you would suddenly find that there's a lot of gold out there that is now suddenly profitable to extract from the ground. So that's true of every asset, that's true of stocks, that's true of houses.
Speaker 2:Bitcoin's the first asset that that's not true, for no matter how high the price goes, the protocol limits the terminal supply to 21 million Bitcoin. So for investors who are looking at it, we help clients in broadly in two ways. Bitcoin can be used as a savings vehicle, or it can be used as a portfolio enhancer. So in the case where it's used as a savings vehicle, we're able to offer clients actual Bitcoin, the actual digital asset that they can either leave with us to custody for them, or they can withdraw into their own custody and keep on a dedicated hardware device, or we now offer a multitude of portfolios that have a segment allocation of Bitcoin ranging from pretty small to pretty substantial, and typically at this point we get that exposure through what's called a spot ETF or exchange traded fund.
Speaker 1:Is Bitcoin part of? If people have an IRA, can Bitcoin be a part of that money that's being invested into your IRAs?
Speaker 2:Yes, it can be part or all of it in some cases.
Speaker 1:Okay, and it seems like people are downloading apps and purchasing these products through their app and I'd be concerned about security, especially if I have a lot invested. I mean, like someone can just download the River app and then they just start buying Bitcoin. I kind of played around with it and I and I that's how that's where I have my Bitcoin right now, you know, um, and then there's other, these other apps like a poll crack in best wallet where people buy these other currencies, and I mean, what's your thoughts about that? Is that really a secure way to have your investments? Or is there some better advice that we can give folks if they want to get into this and another, more secure way of doing that, or a more effective way than just having everything on your phone? That part's a little scary to me.
Speaker 2:For anyone who wants to invest in Bitcoin, the decision that they will have to make is whether they want to take responsibility for the secure custody of their Bitcoin or whether they want to outsource that to a trusted custodian, and there's trade-offs to both.
Speaker 2:But in the case where they are relying on a trusted custodian because they don't want to take responsibility for keeping their Bitcoin safe, it's important to evaluate what the legal nature of the relationship is between you and the counterparty or the custodian. So in the case of Kraken, coinbase, different things like that those are what are commonly referred to as crypto exchanges. Different things like that those are what are commonly referred to as crypto exchanges, and we have seen over the last decade multiple times. Crypto exchanges fail, go bankrupt and result in the permanent loss of at least some of the assets of their account holders. As Bitcoin has matured and embedded itself deeper into the financial system, there are now ways to outsource custody to a qualified custodian, and that is held to a different legal and fiduciary standard, as opposed to a domestic US-based crypto exchange or, especially, a non-US-based crypto exchange, which is where the majority of the issues over the last five years have come from.
Speaker 1:So is Orange Horizon. Is that a custodian of Bitcoin? I mean, is that what you is? That can be part of what you're.
Speaker 2:We use Swan Bitcoin. They have a platform for financial advisors through a company called BitGo that functions as the qualified custodian. So we don't custody client Bitcoin. There's something called the private key that is essential to security. That's what allows you to sign transactions on the Bitcoin network. We don't have access to that. We couldn't, even if we tried. So in that security model, each piece of the security is segmented out to those who are optimized to do it best.
Speaker 1:So would it be better, if you're really getting heavily invested in Bitcoin and you want to do that, would it be better to do that than someone just to have it on the River app on their phone?
Speaker 2:Would it be better for them to do what as opposed to the River app?
Speaker 1:You just explained the custodian part of it. So I mean, is it better to to have it in that that type of a custodial situation, versus me just happening on my on my cell phone through the river app? And broadly speaking. You answer that.
Speaker 2:I mean, it's just it's kind of like you know, hey, matt, what's the best investment? Well, it depends. And so the answer is going to be similar there. Where there is no universal best solution, everything requires trade off. So it it just depends on the situation of that particular person and and we try to help them make that decision.
Speaker 1:but for any one person it might make sense to leave it on river, it might make sense to withdraw it, it might make sense to do something else I'm just coming at this totally out of my lane, trying to understand it and trying to maybe uh, help through you guys, people to just understand a little bit more who might be in the same position. I am hopefully more who might be in the same position. I am Hopefully maybe they're not in the same position. I am from a knowledge standpoint, but just trying to bring some light to it. I guess you could share a little bit how Bitcoin's value has gone up and and why so far it, it appears, has been a really good investment so far. Can we is that? Can we have that discussion, is you?
Speaker 1:know, because I think that was part of your article. I read, where you know, we have these, these, these gross little fall, but then it goes back up again. I mean, I think you that was in the article that you had written that you shared with me.
Speaker 2:Yeah, I'll start that and then let Brett add anything he wants to. If you look at Bitcoin over the last five, ten years, depending on the specific range, the average annualized rate of return is somewhere around 50 to 60 percent, and Brett alluded to the rule of 72. And over the long term, that means your money is doubling, on average every year and a half or so. So over the last decade, bitcoin has dramatically outperformed the stock market. It's outperformed bonds, it's outperformed gold, it's outperformed real estate, it's outperformed every other major asset class in the world. But along with that, which is typical that the more an asset grows over the long term, the more volatility it experiences along the way.
Speaker 2:And in that regard, bitcoin's no exception where, if you look at the last five years or so, a couple of years ago Bitcoin peaked at around $69,000. And then, over the course of about the next year, it drew down all the way to 16,000. And then it moved up and it hit an all-time high of around 109,000. And now we're currently sitting at 85,000 last I checked. Yeah, so those are the two major components. For someone who might want to own some of it is that, at at least so far in its existence, it has massively outperformed other assets that you might want to look at, but it also has a much higher corresponding level of volatility in 2009.
Speaker 3:And one of our good friends, dante Cook, who does some work for Vista Investment Partners and is well known on social media for his comments about Bitcoin, makes a good point that Bitcoin is as old or as a year younger than the iPhone. And if you start thinking about the different technologies that we use now that have come into existence, many of them are digital in nature, and Bitcoin is no different it's digital money. So if you start thinking about using Amazon, if you start thinking about using any of the magnificent seven stocks that I'm not going to name, most of the products are digital. Last time I needed a ride somewhere in a major metropolitan area, I used Uber.
Speaker 3:Uber is an app on my phone that didn't exist 15 years ago, and so you start looking at the digital transformation of things in our world and you start to realize, hey, this is just another evolution We've been using, you know, dollar bills. You know, very rarely do you go anywhere now and not pull out a Visa or MasterCard. You hardly ever see cash anymore, and so the speed and the adoption of digital money, in my opinion, is going to continue to be adopted over the next five years, and we're going to see a financial revolution in terms of speed of how money transacts over the next five years, because of these, we're moving from analog payment rails to digital payment rails. Right, I mean what's?
Speaker 1:I mean credit cards are. Isn't that? That's digital money?
Speaker 2:That's a. That's a good question. Technically it is digital credit and that cause that's a common question of you know Bitcoin's digital money. That doesn't sound all that revolutionary because, after all, don't we already have digital money? Ninety percent of US dollars don't exist in physical form, they exist only in the ledgers of a trusted bank computer. But what we've really had is not digital money, because, from an economic sense, money is a bearer asset.
Speaker 2:Delivery of money constitutes final settlement of an economic transaction, and that is not the case. That is not what happens when you send someone a Venmo or a Zelle payment or a credit card transaction where the payment seemingly occurs instantaneously, but settlement of that payment occurs weeks or even months after the fact. And because of that, there are inefficient layers of counterparty risk, credit risk on top of that. And that costs money where we look at you know why do credit cards charge merchants 3 percent? It's not because they're greedy, it's because that's about how much it costs for them to render that service. So, as Brett was alluding to, one of the unique aspects of Bitcoin is that it's digital, but it's also a bearer asset. It can be sent at the speed of light anywhere in the world and it settles with cash finality and that opens up an array of different potential payment technologies on the back of a digital bearer asset. So we're just starting to see that play out. It'll take some time but, like Brad, I'm excited to see that.
Speaker 1:So we'll probably have a debit card it probably exists, but tell how naive I am but a debit card that is tied into your Bitcoin account, you just pay everything through that.
Speaker 2:Those exist.
Speaker 1:For anything and everything.
Speaker 2:Mm-hmm, it works like a debit card.
Speaker 1:Do you think that are people commonly using that today?
Speaker 2:As a percentage of the US population absolutely not.
Speaker 1:How about a percentage of Bitcoin US population? Absolutely not. How about a percentage of Bitcoin owners?
Speaker 2:Somewhat, I'd say most Bitcoin owners.
Speaker 2:One way I think about Bitcoin, where, if you look at you know I alluded to the fact that the US dollar bleeds purchasing power every year, but we are in a privileged position where, relative to other fiat currencies, the dollar is the best.
Speaker 2:And if you look at countries or jurisdictions with very high inflation problems, it's very common they will use two forms of money One is a medium of exchange and one is a savings vehicle or a store of value. So, in a case where you live in Venezuela, you may get paid in their currency, all your bills may be denominated in that, but you don't want to store your wealth in that currency. Typically, they want to store their wealth in the US dollar, and so, for most Bitcoiners in the US, that's how they primarily use Bitcoin as a savings vehicle, because, despite some of the inefficiencies and things you know, room for disruption that we think there is for Bitcoin for most people most of the time, current legacy payment technologies work pretty well, and so the demand to spend Bitcoin, as you would expect, lags behind the demand to hold it for the long term.
Speaker 1:So, as we begin to kind of wrap this up, two different things I'll ask you guys. Number one is there anything that we need to clarify, that I've muddied up in this conversation, or anything do you think would be pertinent to share with our followers?
Speaker 3:we have done a deep dive company-wide on Bitcoin as an asset class. We've also done a deep dive in our opinion on the other cryptocurrencies that you've mentioned, but we do not believe in recommending or owning those other cryptocurrencies. We believe they have inherent problems, which we'd be happy to discuss in a private conversation, but I wanted to make that clear that that is the only cryptocurrency that we currently and will ever offer.
Speaker 2:Yeah, and I'd like to just double down on Brett's point, because it's an important one and, in my opinion, it is the biggest source of confusion for investors when it comes to Bitcoin is well, what are all these other crypto assets? And, to try to briefly explain the difference, we view them. You know they're all typically lumped in as cryptocurrencies and, in a sense, you can put them all in that category, but we believe Bitcoin is a category of one and non-Bitcoin crypto is a different thing. Okay, um so, yeah, just try to make that clear because, unfortunately, oftentimes someone gets introduced to bitcoin and then you know, a few months later they're buying uh, you know, yo-yo token.
Speaker 1:they've lost 90 of their money, um so, well, I'll see if this is a proper analogy. Is it kind of getting in these other ones, likened to people that buy penny stocks or whatever? Is that fair?
Speaker 2:In some ways yeah, the way I describe it is Bitcoin was a technological innovation, primarily because it was a digital form of money beyond the control of any one party. So there is no government, there is no corporation organization that has unilateral control over the Bitcoin ledger. The Bitcoin ledger is updated through the unfakable expenditure of real world energy in a process called Bitcoin mining that anyone in the world can participate in and that history shows is hard to capture the majority supply of. We've never seen a civilization capture, command, control over 50% of the Earth's surface, because that's tied to energy, and a similar thing is true in the Bitcoin network. So that's the innovation of Bitcoin is a digital asset without an issuer that functions without the unilateral control of any one group.
Speaker 2:For the most part, all non-Bitcoin crypto projects uninvented Bitcoin's innovation by reintroducing a trusted ledger keeper that has the unilateral control authority to make backwards incompatible changes to the ledger. Sometimes that's a corporation, sometimes it's what they call a DAO or decentralized autonomous organization, sometimes it's a nonprofit, but at the end of the day, somebody, somewhere or some group, if they want, can do whatever they want to that monetary ledger. So that's not to say that you can't make money on them or trade them, but that's primarily what we mean when we say they use similar technologies as Bitcoin in terms of encryption and the ledger structure. It's called blockchain, which became a buzzword, but that does not make them of the same kind of thing as Bitcoin. Okay.
Speaker 1:That's good to know. Okay, that's good to know. If any of our followers are interested in financial planning services and want to talk to you guys, what's the best way to contact you or how should they start that process?
Speaker 3:Our local phone number is 765-962-5153,. Or you can get a hold of Matt or myself. Or you can get a hold of Matt or myself, or I'll give my email address brettguiley G-U-I-L-E-Y at vistainvestmentnet.
Speaker 2:Okay, and my email's mattgawlier at vistainvestmentnet. So M-A-T-T dot G-O-L-L-I-H-E-R at vistainvestmentnet.
Speaker 1:So so you guys are gonna get swamped after this podcast goes out and uh, what's that? Just real quickly. I, you know I want to get involved. I'm, I'm interested in getting started, whatever. What's that kind of that first meeting going to look like for me, if I call you guys?
Speaker 2:and what's?
Speaker 1:what should I be? What should that look? What's that going to look like?
Speaker 3:So typically, the first meeting that we have, we set up and it's there's no decisions that are going to be made. We just want to get to know a person, get to know their goals and objectives, tell you a little bit about what our firm offers, our history, and find out if there's a match there and if there is great. If not, then we'll arm you with some information to go on your way.
Speaker 1:Right, but you just kind of want to find out where they're at and then that's going to help you to be able to advise them, give them where they are and what their goals are in the long term. And I alluded to earlier, it doesn't really matter where you're at in life. It's not too late to try to connect with you guys and get something started. Is that true?
Speaker 3:It's always better to start than not to start, and most people take more time planning their annual vacation than they do their finances. Yeah, yeah.
Speaker 1:Well, I really appreciate you guys taking the time to meet with us and endure my questions today, but, brett and Matt, thank you so much for coming on. We really appreciate it. That's all for this episode of the Hub. Thanks again for listening and we'll see you next time for another conversation with a difference maker from our region. Manpower is proud to support the hub. Find out how they can support your business at MPRichmondcom.