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No B.S. Friday: This humbled me. Totally humbled me.

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Your responses to the Power Challenge really showed me just how far I have come and how much I have to be grateful for.

Ok, I’m still blown away that over 100 people made it all the way through the Knowledge Source Power Challenge.

This really is phenomenal. I am totally humbled that people gave it their time and energy, just as the year was lifting off the tarmac.

I know you all had a 1000 other things to do this month. But I’m blown away that there are that many people in this community who are willing to back themselves, invest in themselves, and who have enough faith to answer a call to action when it comes.

And having read through the responses, I’m so amazed at the positivity, the passion and the radical self-responsibility that came through again and again.

I wonder if people get just how much this juices me up.

And for me it’s been a powerful reminder of just where I’m at in life right now.

It wasn’t always this way. I used to be stuck. I used to be surrounded by people who thought it was all too hard, or too unfair, or just too cruel to give it their all – to invest themselves in their dreams.

… to put their hearts on the line.

But reading through the responses I can see how far I have come.

I can see that I’m now thick in a tribe of passion. Everywhere I turn now I meet people who are backing themselves, who are taking action, who are getting it done with a smile on their face.

This is not normal. This is not the way most people live. This is the not the disempowered mud that most people find themselves stuck in.

We are the lucky ones.

I am a lucky one.

And I am truly grateful that people are willing to come with me on this journey – that they’re willing to even consider whatever insane advice I sprinkler all over the internets.

When I started these blogs, it was because I felt like I had something to give, even if I didn’t know exactly what. I was transitioning from young buck to wise old man (in step with my greying beard).

And I was at a stage of some sort of completion. I had become untouchable financially. I was well and truly sorted. And part of that journey was developing the inner resources that made financial success possible.

So I felt qualified to share something.

So I share from an intimate personal space – from my own personal experiences. … and then just hope that people resonate with it.

I still find myself writing stuff and then wondering, what the hell are people going to make of this? This kinda worked for me. But am I just tripping? Maybe for some people this is going to be totally inappropriate advice.

I don’t know their situation. I don’t know what particular challenges they are working with, what particular wounds they are trying to heal. Maybe they actually need to be a little less Jon Giaan, and a little more Elmo or something. I don’t know.

So yeah, take it all with a grain of salt. This is just one man’s journey from broke no-hoper to millionaire on a boat.

You have to feel it out for yourself. Only you can know what is right for you. Part of the journey is learning to litmus test everything against your own truth.

But yeah, today I find myself a little less worried about not meeting people where they are at.

Because having just done the Power Challenge – over 450 people took part, over 100 made it all the way through to the end – and having read through the responses, I feel like I have a better sense of what our “tribe” is.

I am lucky enough to be part of a tribe that is passionate, inspired, open and action-orientated. A tribe where self-responsibility is a focus, drive is a virtue and pretence can be left at the door, thanks. And it is a tribe that encourags and celebrates success.

That’s pretty awesome, right?

Today I see that. I see how far I’ve come. And I see how much I have to be grateful for.

So a big BIG thank you to you all.

I did say I was closing the Power Challenge today. Maybe I’ll let it run through to the end of the weekend before drawing out the prizes.

If you want to get on board, you can catch up with them here, or hit them all at once. I reckon you could get through them all in less than half an hour. And people are telling me that’s it’s given them real clarity, direction and motivation.

This is the full list of challenges:

Challenge One: Energy

Challenge Two: Know your pain

Challenge Three: Take the reins

Challenge Four: Radical Honesty

Challenge Five: Connection

Challenge Six: Receiving

Challenge Seven: Pure Desire

Challenge Eight: Full Permission

Go on. Change the tribe you run with. Change your reality.

Heartfelt thanks again

Even the bears are relaxed – no recession this year

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How likely is a recession this year? Not much.

With prices in Sydney and Melbourne now down 10% year on year, some people are asking me if I think this means we are headed towards recession.

It is true that there is a ‘wealth effect’ – as property prices go up, people feel wealthier and start to spend more. That goes into reverse when prices start to fall.

But I still think Australia will be ok. There will be a period of adjustment, but my guess is that we should avoid recession, and bounce back fairly quickly.

I thought it was interesting that Gerard Minack – one of Australia’s most bearish hedge fund advisors was taking a similar view. I tend to find myself on the sunny side of Gerard most of the time. So it makes me think that if even he is pretty relaxed about our current state of affairs, then we should be right.

Anyway, he reckons that while the wealth effect is in effect, there are some important ‘countervailing forces’ that should keep the boat afloat, and help us avoid a US-style GFC.

First, the mining capex boom inevitably bust, but the bust has now almost run its course (Exhibit 2).

Second, while Australia is building a lot of houses, the pace is normal relative to population (Exhibit 3). (JG – he means we’re not creating an over-supply of housing.)

As a result, Australia’s rental vacancy rate is below average and falling, versus the US vacancy rate that last cycle was above average and rising (Exhibit 4).

A turn lower in residential construction still seems likely in Australia, but there seems less scope for the residential downturn to king-hit growth, as it did in the US in the last cycle (Exhibit 5).

Third, high population growth costs, and one of the costs is rising infrastructure spending (Exhibit 6).  This is a particularly job-intensive sector.

The net effect of the mining capex bust ending and the cranking up of infrastructure spending is that investment spending has rebounded (Exhibit 7).

A fourth, less important offset, is the ramp up of LNG exports (‘mineral fuels’ in Exhibit 8).  This will statistically add to GDP, although it will be calorie-lite growth: the employment tied to these exports is low; very little of the revenues are going to be collected by the government; and shipping so much gas offshore has created a domestic gas shortage, a key reason behind rising domestic energy prices.

At the end of the day, Minack recognises that Australia is in a period of adjustment. We are working through some challenges.

But he also reckons that these challenges have mostly already been priced into markets (Aussie dollar, bonds, equities). He doesn’t see value in shorting any of these things right now.

For these short trades to work, an Australian recession has to be your base-case scenario. For Minack, he just doesn’t see that happening.

And that’s what I reckon too. Yes, house price declines will give everyone a bit of pause for thought.

But the Australian economy is much more than our housing market. It is much more complex and dynamic than just that.

And Australia still has an awful lot going for it. There is still a lot of growth to be had and money to be made.

I mean, even the bears think so.

Is The Global Economy Making Our Property Prices Fall?

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What does the “globalisation of property” mean for investors?

Do you want to invest in the global economy?

You don’t have a choice.

Even if you’re investing in boring old properties down at the end of the street, these days you are still investing in the global economy.

We are all globalists now.

We’re in the middle of the Knowledge Source Power Challenge and today I wanted to have a look at why I take such an interest in the global economy, and why relentless self-education has to be one of your habits.

Bloomberg was running the story last week about how a number of property markets across the world are following each other lower. You thought it was just Sydney and Melbourne, but no, we’re not alone there.

In Manhattan, the median condo price dipped below $1 million for the first time in three years. Hong Kong home values endured their longest losing streak since 2008, while prices in outer London neighborhoods fell for the first time since 2011. Sydney home owners are grappling with the worst real estate slump since the 1980s.

Luxury residential prices are growing at the slowest rate since 2012, according to a Knight Frank index of prime properties in 43 cities…

Governments became concerned the gains were unsustainable, and reacted with measures aimed at curbing the flows of international money…

Similar dynamics are playing out around the world. The number of home sales in Vancouver dropped 32 percent in 2018 from the previous year, following a series of new taxes, stricter mortgage rules and rising interest rates.

Median prices in Auckland registered their first annual drop since 2008 after the New Zealand government passed legislation to restrict foreign buying that it said was partly to blame for escalating housing costs.

Home prices have dropped 11 percent in Sydney from their 2017 peak after government restrictions on foreign purchases and tighter credit.

I knew this was happening but it was interesting to see the data all in one place.

It’s on the IMF’s radar too. Last year they released a report showing that house price growth has become increasingly synchronised at both the city and country level, particularly since the global financial crisis.

The global economy is a new beast. Financial markets are integrated, inflation trends are global in their reach, interest rates are synchronised thanks to free-flowing capital, and institutional money managers tend to hunt in packs. Taken together, all property markets, even your humble little suburb, are global property markets now.

I mean, it used to be the case that houses were just consumables. They were just things people lived in.

Then, with the rise of the property investing class, they became assets. They became things we invested in as well as lived in.

And now, with the integration of the world’s financial markets, they are behaving like financial assets – like stocks and bonds. What happens here depends on what investors all over the world are doing.

This is the new reality. Property is a global financial asset.

And it means we need to keep one eye on what the global economy is doing. We need to keep our vision broad.

Now that is easier said than done. I’m lucky enough to have a research assistant who keeps me up to speed. (Of course I’ll share the gold with you here – watch this space).  

But for now, it is just enough to take an interest in this space. And even simply being aware that property now behaves like a global financial asset will put you a good stride ahead of the pack.

But the broader point here is that no strategy survives for long. The world is changing. Strategy’s that made sense five years ago are obsolete now.

So we have to treat our education and development as an ongoing concern. It’s not a do-it-once, set-and-forget type thing.

You need to be constantly curious – how can I be better, stronger, more savvy?

Curiosity is the key. Ask the question, and the rest will take care of itself.

Power Challenge 5/8: Connection

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Your opportunity to win an I-pad – and make a full-power start to the year. Challenge Five – Connection

Ok, so this is the Knowledge Source Power Challenge – your opportunity to set a cracking start to the year and win some great prizes.

It’s not too late to get on board. This is where we are at so far:

Challenge One: Energy

Challenge Two: Know your pain

Challenge Three: Take the reins

Challenge Four: Radical Honesty

Challenge Five: Connection

Challenge Six: LOCKED

Challenge Seven: LOCKED

Challenge Eight: LOCKED

Staying with relationships, and after having committed to a little more honesty on Friday, let’s have a look at how we can use our connections as a source of strength.

The truth is that humans are a pack animal. There’s a theory that (some of us) shed our fur so we could have more intimate connections and more ways to build social cohesion.

(Rub my belly and I’ll practically do anything for you.)

The uniquely human neo-cortex is devoted to language and managing our social relationships. We didn’t get to the top of the food chain through opposable thumbs alone – we did it because we could work in teams and build cultures of knowledge that could be passed down through time.

We are social by design.

And so I think that if we’re cut off from our ‘pack’, it is a stress that starts to niggle at our biological organism. By the same token, the more intimate connections we have, the more we are touched, and the more we feel supported by our pack, then the stronger and the more confident we feel.

And I’ve learnt that if there’s anything I can do that will make me feel more confident and more powerful, then I will do it. Don’t underestimate the challenges that we’re facing.

So this is for you challenge for today. Tell us what it is that makes you feel supported by your pack, and how you’re planning to tap more of that energy this year.

It really could be anything. Humans are multi-spectrum beings. It could be a regular phone hook up with your brother. It could be Ladies’ Night at the day-spa. It could be sport (which is primarily an excuse for grown men to have a cuddle, let’s be honest).

But look for the connections that give you strength, that give you confidence, that increase the depth of your resources.

Note that I’m not talking about connection as a way to increase your sense of meaning. Looking after an infant gives you purpose, but it doesn’t increase your power. What connections give you strength?

*** BONUS CHALLENGE ***

Pay particular attention to the individuals that give you strength. So say if, like me, your footy team is a source of strength for you, pay attention to which individuals in particular really lift you up.

Or what friend always inspires you? What friend always has your back?

Now send them a short note. Just say, “Hey, been doing a bit of thinking over the break. Just wanted to let you know you’ve always been an inspiring influence in my life. I appreciate having you around.”

This year, give a little more attention to the power connections in your life, and be open to the energy that is returned.

That’s it. Hit up the comments section and let us know

Where and how do you connect with your power pack? How can you do it more this year?

BONUS

Send someone a short note of gratitude. Tell them you’re glad they’re in your corner.

And let’s power-up, together.

Jon

Ps – It’s not too late for anyone to get involved. If you’re sending someone a note, why not invite them into this challenge? There’s still three more juicy challenges to go.


Power Challenge 3/8: Take the Reins

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Your opportunity to win an I-pad – and make a full-power start to the year. Challenge Three – Take the reins.

Alright, the Power Challenge is in full-swing. There are 360 (so far!) heroic individuals who have committed to making this an awesome year. I’m giving you eight quick but deep challenges to see if you are fully in alignment.

(Think of it as a tune up for your success engine.)

There’s still time to get on board. Find the challenges here. As long as you do all eight challenges some time this month you’ll be eligible for the prize draw. I’m relaxed like that.

Ok, so challenge number three. This is about self-discipline.

The road to self-mastery begins with mastering the body.

The Buddha said that the conscious mind’s controls the body the way a rider controls an elephant. The elephant is strong, and has agendas of it’s own. It won’t just do what you say unless you have established control.

So today, I want you to hit up the blog and write down one thing that you’re going to do this week that goes against the instincts of your body.

Maybe it will be taking a cold shower. Maybe it will be going a day without food. Maybe it’s walking up the stairs to your office, which was Stephen B’s answer to our first challenge. (Stephen, you’ve got to come up with something else.)

Think of just one thing you can do this week. Declare it to everyone on this blog.

Then do it.

And when you do it, whatever it is, I want you to pause just before you do it and watch for two things.

1. The Whingeing

First, listen to your body’s excuses. Standing on the edge of a cold lake, you might here yourself complain, “It’s too cold, I’m might catch a flu, I’ve just eaten, I look ridiculous in these budgie smugglers.” Sometimes your body is crafty. Sometimes just whingey. But it always pushes back.

But notice how your body sort of has a capacity to over-ride your inner monologue. Notice how your body’s thoughts can be mistaken for your own thoughts, if you’re not watching carefully. Notice how your boldest agendas can be derailed by the worst and whiniest instincts of our body.

This happens to us ALL. THE. TIME.

There is an art to knowing when your mind is raising reasonable objections, and when your body is just being a little wuss bag. It takes time to know the difference.

2. The Loving Command

Second, I want you to force yourself to do whatever it was you were planning to do. Jump into the lake. Get up at 5 a.m. Fast.

(Actually, fasting is great because you are constantly being presented with temptations.)

Whatever it is, assert your authority, assert your control, and just do it.

But as you’re doing it, I want you to hold an attitude of “loving command.”

Don’t go hating on your body. Don’t go screaming at your body, “Shut up you flabby ball of failure. We’re doing this. I’m throwing us in this lake. F-youuuuu!”

No. Hold an attitude of loving command. Say, “I can see you don’t want to jump in this lake. I know that it’s cold. But I want this for us. And I have the reins. I am in control.”

And then do it.

I think an attitude to loving command is the key to having sustainable, heart-centred self-discipline, which in turn is one of the key pillars of success.

So that’s it. That’s the third challenge. Share the act of discipline you’re going to commit to this week right here in the comments section. And then watch for those two things – The Whingeing and The Loving Command.

I really believe it will help you grow a more powerful self-discipline and self-mastery this year.

Power on!

Jon

Ps – Why not rope somebody else into this challenge. Who do you know who could travel the road of mastery with you? Forward them this email and get them on board.