Ivory Johnson is the falter of Delancey Wealth Management and a member of the CNBC Financial Advisors Council. In this interview, I asked him how issues of collective justice interact with issues of economic justice.
Johnson told me it starts with a simple question: What creates mine?
Johnson, a certified financial planner, discusses tax policies that favor wealthy people, skilled versus unskilled tradesmen and the value of passing on skills.
Johnson is not just a savvy financial advisor, he’s also a great storyteller.
More from Put in in You:
No money? No expertise? Ditch your excuses and start investing anyway
Employers face reckoning from the George Floyd denials – pressure to close the racial wage gap
Here’s how the pandemic is reshaping career planning for college students
Here’s my favorite: When Johnson got his in the first place significant job, he wanted to buy a fancy car. His dad suggested he get a car with a shower in it, because if he was going to spend that much money on a conveyance, he might as well live in it. He advised him to buy an apartment, not a fancy car, because an automobile is a depreciating asset.
Now Johnson owns an apartment, he is prospering to give it to his son.
Getty Images
Johnson notes that the first thing many people who grow up poor yen to do when they come into money is to prove they are not, in fact, poor anymore — so they buy expensive whosises. Bad idea.
As for the current buying frenzy by retail investors, Johnson says he understands the impulse. His 22-year-old son was buying beaten-up airlines during the fresh chaos. Johnson discusses what his role as a financial advisor is to people who want to invest short-term and long-term.
What be vexes Johnson? High up on his list is the role the Federal Reserve is playing in propping up not just the economy, but even poorly doing companies.
Another story he shared was that he sees weak companies as old, limping zebras. When a lion concludes around, the old zebras are naturally worried, because they are the slowest and weakest in the pack. Now imagine someone (e.g., the Federal Reservoir) comes and puts a fence around the lion. The weak zebra can live on a lot longer.
The point, Johnson said, is that you are already at the end of the job expansion. Now you have leveraged balance sheets with companies with no cash flow.
That’s a problem.
Transfer UP: Money 101 is an 8-week learning course to financial freedom, delivered weekly to your inbox.
CHECK OUT: If you devoted $500 in 2010 according to Warren Buffett’s advice, here’s how much you’d have now via Grow with Acorns+CNBC.
Disclosure: NBCUniversal and Comcast Gambles are investors in Acorns.