Fifth Edition - Harsh Reality Newsletter

Today is the fifth edition of the "Harsh Reality" newsletter! We're a month into our new journey! If you're new here, welcome to the fight. If you want to see previous editions of the newsletter they'll be available at the link below.  And if you want to join us on our new Discord server or view our YouTube shorts click on the links below. Our intent is to always provide more value than we extract so thank you for being here and enjoy the show.

Weekly Dose of "Harsh Reality"

Last week we discussed viable paths to success that did NOT include college. This week, (assuming that you decide to attend a university) we're going to discuss why it's so important to pick a field of study, and to follow through with it if you do decide to go the college route. So we start off back in the admissions office from the previous editions. The student advisor asks you, "What do you want to study?" Your response, "I'm not really sure." *Enter the general studies course schedule pitch*

Harsh Reality - What you're really saying is that you have no clue what you want to do at college; but you're willing to pay thousands of dollars a year to try to figure it out. In other words, a whole lot of this. 👇👇👇

*Not knockin' it..  But there are much cheaper ways to attend good parties.*

This is the first pitch that colleges and universities use to separate you from your future financial stability. You must understand that college is one of the most well-oiled business models in existence. The amount of money students waste ticking off "core classes" is immense. Add on top of that changing schools and majors over and over and you can see how someone can really put themselves in an overwhelming situation. On its face, general studies coursework sounds like a reasonable starting point for those unsure of their ultimate path forward. Unfortunately there are some serious issues and nefarious business practices at play. 

The first is the idea that someone pursuing a specific field of study needs to spend two years developing an "educational base" to start from. That's literally what high school is for, or so they told us. Four years of electives, fairly advanced math, science, english and history. Any of you feel educated after that experience? Well too bad because apparently you need two more years of that to qualify for your business degree that will use almost none of it.

The second issue, reference the nefarious business practices, is that it accounts for 50% of the cost of an undergraduate degree and the VAST majority of the school's revenue. In other words, they are financially incentivized to make college as cumbersome and long a process as possible. Unfortunately most of the drop-outs get snagged up on the general studies/core curriculum course work. Obviously, the course work was still paid for by those students; hence why it still exists. Sadly, most of us are too indoctrinated to see how foolish of a set-up it all is.. Alas, I think we can all agree that if someone lacks a basic understanding of english or history, to the point that it causes them to fail an actual degree related course, they didn't need to be there to begin with. The rest of it is a way to line their pockets.

Finally, what happens to those students who fall into one of the following categories:

• Decides on a major after a couple of years - Unfortunately, although this is the most prudent step to take, more nefariousness awaits you. Some of the coursework you already completed, and paid for, will not be applicable to the major you want to pursue. More classes and more financial burdens await you.

• Never decides on a major - The school has you covered! You can obtain your general studies degree! The student spends four years, and tens of thousands of dollars, to have a degree in nothing particular. Unfortunately, the school continues to remind you of that by not allowing those with general studies degrees to attend graduate level programs.

• Decides to change schools or drop out - This is likely what the student loan system is hoping for. (Yes, I have a bad opinion of our higher education system and its funding mechanisms) If a student changes schools the likelihood of their credits transferring to the new school is very low. This means more money for the school system because you'll end up attending those courses again. Statistically, you're also less likely to graduate because it prolongs the process dramatically..

In closing, if you don't receive some form of a scholarship, college needs to be reserved for those who are pursuing a long-held passion in a career field that also requires a degree. It's not the place where you go and figure it out to the tune of tens of thousands in student loans.

The argument could also be made that someone could attend college to pursue a high-paying starter job (See the fourth edition). I do not necessarily agree with that but one needs to be aware of the risks outlined in the previous editions of this newsletter. You can find all of them here. 

For the parents out there, the "Secure Act 2.0" signed in 2022, allows you to roll over $35k of your 529 investments to a ROTH IRA for your kids starting in 2024. This is a significant opportunity and you should discuss it with your children if it applies. You can read up on the details here.

Shit That Matters

Origins of COVID - The U.S. Department of Energy announced this week that they believe "with a low level of confidence" that COVID originated from a lab leak, and not an animal from China.

Harsh Reality - Well no shit.. I'm glad you came to that conclusion a year after this became a dead issue and after various government entities attacked personal liberties of individuals throughout the U.S. for stating this exact same thing. Very 1984 of you.. Bring on the investigations and indictments!

Russo-Ukrainian War - Russia continues to press towards Bakhmut while the Ukrainians executed strikes on positions in Belarus, Belgorod, and possibly Kolomna (Moscow Oblast), Russia.

Harsh Reality - This is a very bad situation for Ukraine. Their attacks are mainly symbolic and will not slow the advancing Russians.

Russia is pressing to encircle Bakhmut and to cut off the supply lines connecting the "rear" of the city. As of close of business on 3 March 2023, the Russians were contesting both exfil routes out of the west side of the city and the Ukrainians were blowing up bridges to slow the Russian advance from the east. With the fall of Bakhmut likely imminent, the next significant battle will be for Vuhledar; which is already in progress. Check out our Facebook page/group for videos and pictures of ongoing hostilities.

Student Loan Forgiveness - The Supreme Court of the United States will likely declare the Biden administration's student loan forgiveness plan unconstitutional.

Harsh Reality - As they should.. Not only is this an attempt by democrats to buy votes from low-information voters; it's a gross misuse of taxpayer money. You want to have a discussion about ending the Government involvement in the program all together, I'm all ears. Want to create a law that caps interest rates for existing loans, I'm all ears. Want to create a plan that allows a dollar for dollar tax credit for employers that match employee payments on student loans, I'm all ears. Keep the rest of the foolishness to yourself.

The conservatives are not doing themselves any favors in this situation by not offering more valid solutions to the student loan issue and the horrendous cost of education. Rolling back the cost of federally subsidized universities to 2000 levels while pegging (limiting) education inflation to the consumer price index would be a good place to start. 

Iranian Schoolgirls Poisoned - Over 700 girls appear to have been poisoned while attending school since November.

Harsh Reality - Post should read, "Ayatollah Khomeini and the clerical rulers of Iran have poisoned over 700 girls in 30 different schools in Iran." Protests have been ongoing for the better part of seven months in response to the death of Mahsa Amini. She had been arrested and was ultimately killed while in custody for refusing to abide by the Ayatollah's hijab policy (hair and body coverings). The Iranian rulers have dispersed the protests using public executions, arrests and internet blackouts. Add to their tool kit poisoning schoolgirls. It is worth noting that the Iranian Rial (currency) has hit its lowest point ever late last month. The Biden administration has been largely silent on this issue while pushing for their disasterous nuclear deal.

**Yes we know that whomever wrote the meme above has impeccable grammar. The message is still applicable and has proven itself to be quite astute.**

Honorable Mentions - The train derailment in Ohio and the earthquakes in Turkey and Syria all but fell of the end of the world as far as news coverage goes. Rest assured that both of those situations are still major issues and we'll keep you updated on additional information as it comes available.

Weekly Market Recap

Shit That Doesn't Matter

Biden Threatens Veto Over Challenge To ESG - The U.S. Senate has voted to block a labor department rule that pushed investment in ESG endorsed companies.

Harsh Reality - Regardless of your politics, ESG rankings for companies make no sense. Case in point, Exxon Mobile has a higher ESG score than Tesla. Also, let's look at how well ESG investment played out in Sri Lanka. Here's a second source from the WSJ.

For those who don't know, ESG stands for Environmental, Social and Governance. A lot of people call it a "woke score." Basically its a rating that shows how a company impacts the world's ESG issues. The higher the score the lower their negative impact. Unfortunately, an ESG ranking has zero to do with how profitable or how well a company is run. ESG also has no influence on the fiduciary responsibility of a fund manager. However, the labor department rule codified that fund managers can use ESG scores as a consideration when making fiduciary decisions. In simple terms, they can remove higher performing companies from indexes and funds based on their ESG score; regardless of their financial performance. The day an investment firm tells me that my money was invested based on an ESG score, I'm done with that company. 

TikTok Limits - Tiktok has created a new policy that will "limit" users that are under 18 to sixty minutes of use each day.

Harsh Reality - This is mostly bullshit. As calls from U.S. lawmakers to ban TikTok increase, they are attempting to play headline games. What they are actually doing is adding an alert to notify the user that they are surpassing one hour of use. There is no actual limit to the use of the app and the alert can be dismissed with a swipe of the finger.

Messi Breaking Records.. Again - Lionel Messi has broken yet another record by sharing the most liked post in Instagram history.

Harsh Reality - Good for him. By all accounts he's a likable and humble guy in addition to being a baller on the pitch. His online presence will serve him well in his future retirement.

That's A Wrap!

Thank you for taking the time to read this edition of "Harsh Reality." Each edition will only get better going forward so if you got value from this content please consider inviting your friends and family to subscribe using the link below. Once we make it to 10,000 subscribers this will transition from a weekly to a daily newsletter and we need your help to get there! Also, hit us on our Facebook page, YouTube channel or Discord server to keep the conversation going! We welcome your feedback and discussion!