More on Economics & Investing

Ben Carlson
3 years ago
Bear market duration and how to invest during one
Bear markets don't last forever, but that's hard to remember. Jamie Cullen's illustration
A bear market is a 20% decline from peak to trough in stock prices.
The S&P 500 was down 24% from its January highs at its low point this year. Bear market.
The U.S. stock market has had 13 bear markets since WWII (including the current one). Previous 12 bear markets averaged –32.7% losses. From peak to trough, the stock market averaged 12 months. The average time from bottom to peak was 21 months.
In the past seven decades, a bear market roundtrip to breakeven has averaged less than three years.
Long-term averages can vary widely, as with all historical market data. Investors can learn from past market crashes.
Historical bear markets offer lessons.
Bear market duration
A bear market can cost investors money and time. Most of the pain comes from stock market declines, but bear markets can be long.
Here are the longest U.S. stock bear markets since World war 2:
Stock market crashes can make it difficult to break even. After the 2008 financial crisis, the stock market took 4.5 years to recover. After the dotcom bubble burst, it took seven years to break even.
The longer you're underwater in the market, the more suffering you'll experience, according to research. Suffering can lead to selling at the wrong time.
Bear markets require patience because stocks can take a long time to recover.
Stock crash recovery
Bear markets can end quickly. The Corona Crash in early 2020 is an example.
The S&P 500 fell 34% in 23 trading sessions, the fastest bear market from a high in 90 years. The entire crash lasted one month. Stocks broke even six months after bottoming. Stocks rose 100% from those lows in 15 months.
Seven bear markets have lasted two years or less since 1945.
The 2020 recovery was an outlier, but four other bear markets have made investors whole within 18 months.
During a bear market, you don't know if it will end quickly or feel like death by a thousand cuts.
Recessions vs. bear markets
Many people believe the U.S. economy is in or heading for a recession.
I agree. Four-decade high inflation. Since 1945, inflation has exceeded 5% nine times. Each inflationary spike caused a recession. Only slowing economic demand seems to stop price spikes.
This could happen again. Stocks seem to be pricing in a recession.
Recessions almost always cause a bear market, but a bear market doesn't always equal a recession. In 1946, the stock market fell 27% without a recession in sight. Without an economic slowdown, the stock market fell 22% in 1966. Black Monday in 1987 was the most famous stock market crash without a recession. Stocks fell 30% in less than a week. Many believed the stock market signaled a depression. The crash caused no slowdown.
Economic cycles are hard to predict. Even Wall Street makes mistakes.
Bears vs. bulls
Bear markets for U.S. stocks always end. Every stock market crash in U.S. history has been followed by new all-time highs.
How should investors view the recession? Investing risk is subjective.
You don't have as long to wait out a bear market if you're retired or nearing retirement. Diversification and liquidity help investors with limited time or income. Cash and short-term bonds drag down long-term returns but can ensure short-term spending.
Young people with years or decades ahead of them should view this bear market as an opportunity. Stock market crashes are good for net savers in the future. They let you buy cheap stocks with high dividend yields.
You need discipline, patience, and planning to buy stocks when it doesn't feel right.
Bear markets aren't fun because no one likes seeing their portfolio fall. But stock market downturns are a feature, not a bug. If stocks never crashed, they wouldn't offer such great long-term returns.

Sofien Kaabar, CFA
3 years ago
How to Make a Trading Heatmap
Python Heatmap Technical Indicator
Heatmaps provide an instant overview. They can be used with correlations or to predict reactions or confirm the trend in trading. This article covers RSI heatmap creation.
The Market System
Market regime:
Bullish trend: The market tends to make higher highs, which indicates that the overall trend is upward.
Sideways: The market tends to fluctuate while staying within predetermined zones.
Bearish trend: The market has the propensity to make lower lows, indicating that the overall trend is downward.
Most tools detect the trend, but we cannot predict the next state. The best way to solve this problem is to assume the current state will continue and trade any reactions, preferably in the trend.
If the EURUSD is above its moving average and making higher highs, a trend-following strategy would be to wait for dips before buying and assuming the bullish trend will continue.
Indicator of Relative Strength
J. Welles Wilder Jr. introduced the RSI, a popular and versatile technical indicator. Used as a contrarian indicator to exploit extreme reactions. Calculating the default RSI usually involves these steps:
Determine the difference between the closing prices from the prior ones.
Distinguish between the positive and negative net changes.
Create a smoothed moving average for both the absolute values of the positive net changes and the negative net changes.
Take the difference between the smoothed positive and negative changes. The Relative Strength RS will be the name we use to describe this calculation.
To obtain the RSI, use the normalization formula shown below for each time step.
The 13-period RSI and black GBPUSD hourly values are shown above. RSI bounces near 25 and pauses around 75. Python requires a four-column OHLC array for RSI coding.
import numpy as np
def add_column(data, times):
for i in range(1, times + 1):
new = np.zeros((len(data), 1), dtype = float)
data = np.append(data, new, axis = 1)
return data
def delete_column(data, index, times):
for i in range(1, times + 1):
data = np.delete(data, index, axis = 1)
return data
def delete_row(data, number):
data = data[number:, ]
return data
def ma(data, lookback, close, position):
data = add_column(data, 1)
for i in range(len(data)):
try:
data[i, position] = (data[i - lookback + 1:i + 1, close].mean())
except IndexError:
pass
data = delete_row(data, lookback)
return data
def smoothed_ma(data, alpha, lookback, close, position):
lookback = (2 * lookback) - 1
alpha = alpha / (lookback + 1.0)
beta = 1 - alpha
data = ma(data, lookback, close, position)
data[lookback + 1, position] = (data[lookback + 1, close] * alpha) + (data[lookback, position] * beta)
for i in range(lookback + 2, len(data)):
try:
data[i, position] = (data[i, close] * alpha) + (data[i - 1, position] * beta)
except IndexError:
pass
return data
def rsi(data, lookback, close, position):
data = add_column(data, 5)
for i in range(len(data)):
data[i, position] = data[i, close] - data[i - 1, close]
for i in range(len(data)):
if data[i, position] > 0:
data[i, position + 1] = data[i, position]
elif data[i, position] < 0:
data[i, position + 2] = abs(data[i, position])
data = smoothed_ma(data, 2, lookback, position + 1, position + 3)
data = smoothed_ma(data, 2, lookback, position + 2, position + 4)
data[:, position + 5] = data[:, position + 3] / data[:, position + 4]
data[:, position + 6] = (100 - (100 / (1 + data[:, position + 5])))
data = delete_column(data, position, 6)
data = delete_row(data, lookback)
return dataMake sure to focus on the concepts and not the code. You can find the codes of most of my strategies in my books. The most important thing is to comprehend the techniques and strategies.
My weekly market sentiment report uses complex and simple models to understand the current positioning and predict the future direction of several major markets. Check out the report here:
Using the Heatmap to Find the Trend
RSI trend detection is easy but useless. Bullish and bearish regimes are in effect when the RSI is above or below 50, respectively. Tracing a vertical colored line creates the conditions below. How:
When the RSI is higher than 50, a green vertical line is drawn.
When the RSI is lower than 50, a red vertical line is drawn.
Zooming out yields a basic heatmap, as shown below.
Plot code:
def indicator_plot(data, second_panel, window = 250):
fig, ax = plt.subplots(2, figsize = (10, 5))
sample = data[-window:, ]
for i in range(len(sample)):
ax[0].vlines(x = i, ymin = sample[i, 2], ymax = sample[i, 1], color = 'black', linewidth = 1)
if sample[i, 3] > sample[i, 0]:
ax[0].vlines(x = i, ymin = sample[i, 0], ymax = sample[i, 3], color = 'black', linewidth = 1.5)
if sample[i, 3] < sample[i, 0]:
ax[0].vlines(x = i, ymin = sample[i, 3], ymax = sample[i, 0], color = 'black', linewidth = 1.5)
if sample[i, 3] == sample[i, 0]:
ax[0].vlines(x = i, ymin = sample[i, 3], ymax = sample[i, 0], color = 'black', linewidth = 1.5)
ax[0].grid()
for i in range(len(sample)):
if sample[i, second_panel] > 50:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'green', linewidth = 1.5)
if sample[i, second_panel] < 50:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'red', linewidth = 1.5)
ax[1].grid()
indicator_plot(my_data, 4, window = 500)Call RSI on your OHLC array's fifth column. 4. Adjusting lookback parameters reduces lag and false signals. Other indicators and conditions are possible.
Another suggestion is to develop an RSI Heatmap for Extreme Conditions.
Contrarian indicator RSI. The following rules apply:
Whenever the RSI is approaching the upper values, the color approaches red.
The color tends toward green whenever the RSI is getting close to the lower values.
Zooming out yields a basic heatmap, as shown below.
Plot code:
import matplotlib.pyplot as plt
def indicator_plot(data, second_panel, window = 250):
fig, ax = plt.subplots(2, figsize = (10, 5))
sample = data[-window:, ]
for i in range(len(sample)):
ax[0].vlines(x = i, ymin = sample[i, 2], ymax = sample[i, 1], color = 'black', linewidth = 1)
if sample[i, 3] > sample[i, 0]:
ax[0].vlines(x = i, ymin = sample[i, 0], ymax = sample[i, 3], color = 'black', linewidth = 1.5)
if sample[i, 3] < sample[i, 0]:
ax[0].vlines(x = i, ymin = sample[i, 3], ymax = sample[i, 0], color = 'black', linewidth = 1.5)
if sample[i, 3] == sample[i, 0]:
ax[0].vlines(x = i, ymin = sample[i, 3], ymax = sample[i, 0], color = 'black', linewidth = 1.5)
ax[0].grid()
for i in range(len(sample)):
if sample[i, second_panel] > 90:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'red', linewidth = 1.5)
if sample[i, second_panel] > 80 and sample[i, second_panel] < 90:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'darkred', linewidth = 1.5)
if sample[i, second_panel] > 70 and sample[i, second_panel] < 80:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'maroon', linewidth = 1.5)
if sample[i, second_panel] > 60 and sample[i, second_panel] < 70:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'firebrick', linewidth = 1.5)
if sample[i, second_panel] > 50 and sample[i, second_panel] < 60:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'grey', linewidth = 1.5)
if sample[i, second_panel] > 40 and sample[i, second_panel] < 50:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'grey', linewidth = 1.5)
if sample[i, second_panel] > 30 and sample[i, second_panel] < 40:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'lightgreen', linewidth = 1.5)
if sample[i, second_panel] > 20 and sample[i, second_panel] < 30:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'limegreen', linewidth = 1.5)
if sample[i, second_panel] > 10 and sample[i, second_panel] < 20:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'seagreen', linewidth = 1.5)
if sample[i, second_panel] > 0 and sample[i, second_panel] < 10:
ax[1].vlines(x = i, ymin = 0, ymax = 100, color = 'green', linewidth = 1.5)
ax[1].grid()
indicator_plot(my_data, 4, window = 500)Dark green and red areas indicate imminent bullish and bearish reactions, respectively. RSI around 50 is grey.
Summary
To conclude, my goal is to contribute to objective technical analysis, which promotes more transparent methods and strategies that must be back-tested before implementation.
Technical analysis will lose its reputation as subjective and unscientific.
When you find a trading strategy or technique, follow these steps:
Put emotions aside and adopt a critical mindset.
Test it in the past under conditions and simulations taken from real life.
Try optimizing it and performing a forward test if you find any potential.
Transaction costs and any slippage simulation should always be included in your tests.
Risk management and position sizing should always be considered in your tests.
After checking the above, monitor the strategy because market dynamics may change and make it unprofitable.
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Adam Hayes
3 years ago
Bernard Lawrence "Bernie" Madoff, the largest Ponzi scheme in history
Madoff who?
Bernie Madoff ran the largest Ponzi scheme in history, defrauding thousands of investors over at least 17 years, and possibly longer. He pioneered electronic trading and chaired Nasdaq in the 1990s. On April 14, 2021, he died while serving a 150-year sentence for money laundering, securities fraud, and other crimes.
Understanding Madoff
Madoff claimed to generate large, steady returns through a trading strategy called split-strike conversion, but he simply deposited client funds into a single bank account and paid out existing clients. He funded redemptions by attracting new investors and their capital, but the market crashed in late 2008. He confessed to his sons, who worked at his firm, on Dec. 10, 2008. Next day, they turned him in. The fund reported $64.8 billion in client assets.
Madoff pleaded guilty to 11 federal felony counts, including securities fraud, wire fraud, mail fraud, perjury, and money laundering. Ponzi scheme became a symbol of Wall Street's greed and dishonesty before the financial crisis. Madoff was sentenced to 150 years in prison and ordered to forfeit $170 billion, but no other Wall Street figures faced legal ramifications.
Bernie Madoff's Brief Biography
Bernie Madoff was born in Queens, New York, on April 29, 1938. He began dating Ruth (née Alpern) when they were teenagers. Madoff told a journalist by phone from prison that his father's sporting goods store went bankrupt during the Korean War: "You watch your father, who you idolize, build a big business and then lose everything." Madoff was determined to achieve "lasting success" like his father "whatever it took," but his career had ups and downs.
Early Madoff investments
At 22, he started Bernard L. Madoff Investment Securities LLC. First, he traded penny stocks with $5,000 he earned installing sprinklers and as a lifeguard. Family and friends soon invested with him. Madoff's bets soured after the "Kennedy Slide" in 1962, and his father-in-law had to bail him out.
Madoff felt he wasn't part of the Wall Street in-crowd. "We weren't NYSE members," he told Fishman. "It's obvious." According to Madoff, he was a scrappy market maker. "I was happy to take the crumbs," he told Fishman, citing a client who wanted to sell eight bonds; a bigger firm would turn it down.
Recognition
Success came when he and his brother Peter built electronic trading capabilities, or "artificial intelligence," that attracted massive order flow and provided market insights. "I had all these major banks coming down, entertaining me," Madoff told Fishman. "It was mind-bending."
By the late 1980s, he and four other Wall Street mainstays processed half of the NYSE's order flow. Controversially, he paid for much of it, and by the late 1980s, Madoff was making in the vicinity of $100 million a year. He was Nasdaq chairman from 1990 to 1993.
Madoff's Ponzi scheme
It is not certain exactly when Madoff's Ponzi scheme began. He testified in court that it began in 1991, but his account manager, Frank DiPascali, had been at the firm since 1975.
Why Madoff did the scheme is unclear. "I had enough money to support my family's lifestyle. "I don't know why," he told Fishman." Madoff could have won Wall Street's respect as a market maker and electronic trading pioneer.
Madoff told Fishman he wasn't solely responsible for the fraud. "I let myself be talked into something, and that's my fault," he said, without saying who convinced him. "I thought I could escape eventually. I thought it'd be quick, but I couldn't."
Carl Shapiro, Jeffry Picower, Stanley Chais, and Norm Levy have been linked to Bernard L. Madoff Investment Securities LLC for years. Madoff's scheme made these men hundreds of millions of dollars in the 1960s and 1970s.
Madoff told Fishman, "Everyone was greedy, everyone wanted to go on." He says the Big Four and others who pumped client funds to him, outsourcing their asset management, must have suspected his returns or should have. "How can you make 15%-18% when everyone else is making less?" said Madoff.
How Madoff Got Away with It for So Long
Madoff's high returns made clients look the other way. He deposited their money in a Chase Manhattan Bank account, which merged to become JPMorgan Chase & Co. in 2000. The bank may have made $483 million from those deposits, so it didn't investigate.
When clients redeemed their investments, Madoff funded the payouts with new capital he attracted by promising unbelievable returns and earning his victims' trust. Madoff created an image of exclusivity by turning away clients. This model let half of Madoff's investors profit. These investors must pay into a victims' fund for defrauded investors.
Madoff wooed investors with his philanthropy. He defrauded nonprofits, including the Elie Wiesel Foundation for Peace and Hadassah. He approached congregants through his friendship with J. Ezra Merkin, a synagogue officer. Madoff allegedly stole $1 billion to $2 billion from his investors.
Investors believed Madoff for several reasons:
- His public portfolio seemed to be blue-chip stocks.
- His returns were high (10-20%) but consistent and not outlandish. In a 1992 interview with Madoff, the Wall Street Journal reported: "[Madoff] insists the returns were nothing special, given that the S&P 500-stock index returned 16.3% annually from 1982 to 1992. 'I'd be surprised if anyone thought matching the S&P over 10 years was remarkable,' he says.
- "He said he was using a split-strike collar strategy. A collar protects underlying shares by purchasing an out-of-the-money put option.
SEC inquiry
The Securities and Exchange Commission had been investigating Madoff and his securities firm since 1999, which frustrated many after he was prosecuted because they felt the biggest damage could have been prevented if the initial investigations had been rigorous enough.
Harry Markopolos was a whistleblower. In 1999, he figured Madoff must be lying in an afternoon. The SEC ignored his first Madoff complaint in 2000.
Markopolos wrote to the SEC in 2005: "The largest Ponzi scheme is Madoff Securities. This case has no SEC reward, so I'm turning it in because it's the right thing to do."
Many believed the SEC's initial investigations could have prevented Madoff's worst damage.
Markopolos found irregularities using a "Mosaic Method." Madoff's firm claimed to be profitable even when the S&P fell, which made no mathematical sense given what he was investing in. Markopolos said Madoff Securities' "undisclosed commissions" were the biggest red flag (1 percent of the total plus 20 percent of the profits).
Markopolos concluded that "investors don't know Bernie Madoff manages their money." Markopolos learned Madoff was applying for large loans from European banks (seemingly unnecessary if Madoff's returns were high).
The regulator asked Madoff for trading account documentation in 2005, after he nearly went bankrupt due to redemptions. The SEC drafted letters to two of the firms on his six-page list but didn't send them. Diana Henriques, author of "The Wizard of Lies: Bernie Madoff and the Death of Trust," documents the episode.
In 2008, the SEC was criticized for its slow response to Madoff's fraud.
Confession, sentencing of Bernie Madoff
Bernard L. Madoff Investment Securities LLC reported 5.6% year-to-date returns in November 2008; the S&P 500 fell 39%. As the selling continued, Madoff couldn't keep up with redemption requests, and on Dec. 10, he confessed to his sons Mark and Andy, who worked at his firm. "After I told them, they left, went to a lawyer, who told them to turn in their father, and I never saw them again. 2008-12-11: Bernie Madoff arrested.
Madoff insists he acted alone, but several of his colleagues were jailed. Mark Madoff died two years after his father's fraud was exposed. Madoff's investors committed suicide. Andy Madoff died of cancer in 2014.
2009 saw Madoff's 150-year prison sentence and $170 billion forfeiture. Marshals sold his three homes and yacht. Prisoner 61727-054 at Butner Federal Correctional Institution in North Carolina.
Madoff's lawyers requested early release on February 5, 2020, claiming he has a terminal kidney disease that may kill him in 18 months. Ten years have passed since Madoff's sentencing.
Bernie Madoff's Ponzi scheme aftermath
The paper trail of victims' claims shows Madoff's complexity and size. Documents show Madoff's scam began in the 1960s. His final account statements show $47 billion in "profit" from fake trades and shady accounting.
Thousands of investors lost their life savings, and multiple stories detail their harrowing loss.
Irving Picard, a New York lawyer overseeing Madoff's bankruptcy, has helped investors. By December 2018, Picard had recovered $13.3 billion from Ponzi scheme profiteers.
A Madoff Victim Fund (MVF) was created in 2013 to help compensate Madoff's victims, but the DOJ didn't start paying out the $4 billion until late 2017. Richard Breeden, a former SEC chair who oversees the fund, said thousands of claims were from "indirect investors"
Breeden and his team had to reject many claims because they weren't direct victims. Breeden said he based most of his decisions on one simple rule: Did the person invest more than they withdrew? Breeden estimated 11,000 "feeder" investors.
Breeden wrote in a November 2018 update for the Madoff Victim Fund, "We've paid over 27,300 victims 56.65% of their losses, with thousands more to come." In December 2018, 37,011 Madoff victims in the U.S. and around the world received over $2.7 billion. Breeden said the fund expected to make "at least one more significant distribution in 2019"
This post is a summary. Read full article here
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Hudson Rennie
3 years ago
Meet the $5 million monthly controversy-selling King of Toxic Masculinity.
Trigger warning — Andrew Tate is running a genius marketing campaign
Andrew Tate is a 2022 internet celebrity.
Kickboxing world champion became rich playboy with controversial views on gender roles.
Andrew's get-rich-quick scheme isn't new. His social media popularity is impressive.
He’s currently running one of the most genius marketing campaigns in history.
He pulls society's pendulum away from diversity and inclusion and toward diversion and exclusion. He's unstoppable.
Here’s everything you need to know about Andrew Tate. And how he’s playing chess while the world plays checkers.
Cobra Tate is the name he goes by.
American-born, English-raised entrepreneur Andrew Tate lives in Romania.
Romania? Says Andrew,
“I prefer a country in which corruption is available to everyone.”
Andrew was a professional kickboxer with the ring moniker Cobra before starting Hustlers University.
Before that, he liked chess and worshipped his father.
Emory Andrew Tate III is named after his grandmaster chess player father.
Emory was the first black-American chess champion. He was military, martial arts-trained, and multilingual. A superhuman.
He lived in his car to make ends meet.
Andrew and Tristan relocated to England with their mother when their parents split.
It was there that Andrew began his climb toward becoming one of the internet’s greatest villains.
Andrew fell in love with kickboxing.
Andrew spent his 20s as a professional kickboxer and reality TV star, featuring on Big Brother UK and The Ultimate Traveller.
These 3 incidents, along with a chip on his shoulder, foreshadowed Andrews' social media breakthrough.
Chess
Combat sports
Reality television
A dangerous trio.
Andrew started making money online after quitting kickboxing in 2017 due to an eye issue.
Andrew didn't suddenly become popular.
Andrew's web work started going viral in 2022.
Due to his contentious views on patriarchy and gender norms, he's labeled the King of Toxic Masculinity. His most contentious views (trigger warning):
“Women are intrinsically lazy.”
“Female promiscuity is disgusting.”
“Women shouldn’t drive cars or fly planes.”
“A lot of the world’s problems would be solved if women had their body count tattooed on their foreheads.”
Andrew's two main beliefs are:
“These are my personal opinions based on my experiences.”
2. “I believe men are better at some things and women are better at some things. We are not equal.”
Andrew intentionally offends.
Andrew's thoughts began circulating online in 2022.
In July 2022, he was one of the most Googled humans, surpassing:
Joe Biden
Donald Trump
Kim Kardashian
Andrews' rise is a mystery since no one can censure or suppress him. This is largely because Andrew nor his team post his clips.
But more on that later.
Andrew's path to wealth.
Andrew Tate is a self-made millionaire. His morality is uncertain.
Andrew and Tristan needed money soon after retiring from kickboxing.
“I owed some money to some dangerous people. I had $70K and needed $100K to stay alive.”
Andrews lost $20K on roulette at a local casino.
Andrew had one week to make $50,000, so he started planning. Andrew locked himself in a chamber like Thomas Edison to solve an energy dilemma.
He listed his assets.
Physical strength (but couldn’t fight)
a BMW (worth around $20K)
Intelligence (but no outlet)
A lightbulb.
He had an epiphany after viewing a webcam ad. He sought aid from women, ironically. His 5 international girlfriends are assets.
Then, a lightbulb.
Andrew and Tristan messaged and flew 7 women to a posh restaurant. Selling desperation masked as opportunity, Andrew pitched his master plan:
A webcam business — with a 50/50 revenue split.
5 women left.
2 stayed.
Andrew Tate, a broke kickboxer, became Top G, Cobra Tate.
The business model was simple — yet sad.
Andrew's girlfriends moved in with him and spoke online for 15+ hours a day. Andrew handled ads and equipment as the women posed.
Andrew eventually took over their keyboards, believing he knew what men wanted more than women.
Andrew detailed on the Full Send Podcast how he emotionally manipulated men for millions. They sold houses, automobiles, and life savings to fuel their companionship addiction.
When asked if he felt bad, Andrew said,
“F*ck no.“
Andrew and Tristan wiped off debts, hired workers, and diversified.
Tristan supervised OnlyFans models.
Andrew bought Romanian casinos and MMA league RXF (Real Xtreme Fighting).
Pandemic struck suddenly.
Andrew couldn't run his 2 businesses without a plan. Another easy moneymaker.
He banked on Hustlers University.
The actual cause of Andrew's ubiquity.
On a Your Mom’s House episode Andrew's 4 main revenue sources:
Hustler’s University
2. Owning casinos in Romania
3. Owning 10% of the Romanian MMA league “RXF”
4. “The War Room” — a society of rich and powerful men
When the pandemic hit, 3/4 became inoperable.
So he expanded Hustlers University.
But what is Hustler’s University?
Andrew says Hustlers University teaches 18 wealth-building tactics online. Examples:
Real estate
Copywriting
Amazon FBA
Dropshipping
Flipping Cryptos
How to swiftly become wealthy.
Lessons are imprecise, rudimentary, and macro-focused, say reviews. Invest wisely, etc. Everything is free online.
You pay for community. One unique income stream.
The only money-making mechanism that keeps the course from being a scam.
The truth is, many of Andrew’s students are actually making money. Maybe not from the free YouTube knowledge Andrew and his professors teach in the course, but through Hustler’s University’s affiliate program.
Affiliates earn 10% commission for each new student = $5.
Students can earn $10 for each new referral in the first two months.
Andrew earns $50 per membership per month.
This affiliate program isn’t anything special — in fact, it’s on the lower end of affiliate payouts. Normally, it wouldn’t be very lucrative.
But it has one secret weapon— Andrew and his viral opinions.
Andrew is viral. Andrew went on a media tour in January 2022 after appearing on Your Mom's House.
And many, many more…
He chatted with Twitch streamers. Hustlers University wanted more controversy (and clips).
Here’s the strategy behind Hustler’s University that has (allegedly) earned students upwards of $10K per month:
Make a social media profile with Andrew Tates' name and photo.
Post any of the online videos of Andrews that have gone viral.
Include a referral link in your bio.
Effectively simple.
Andrew's controversy attracts additional students. More student clips circulate as more join. Andrew's students earn more and promote the product as he goes viral.
A brilliant plan that's functioning.
At the beginning of his media tour, Hustler’s University had 5,000 students. 6 months in, and he now has over 100,000.
One income stream generates $5 million every month.
Andrew's approach is not new.
But it is different.
In the early 2010s, Tai Lopez dominated the internet.
His viral video showed his house.
“Here in my garage. Just bought this new Lamborghini.”
Tais' marketing focused on intellect, not strength, power, and wealth to attract women.
How reading quicker leads to financial freedom in 67 steps.
Years later, it was revealed that Tai Lopez rented the mansion and Lamborghini as a marketing ploy to build social proof. Meanwhile, he was living in his friend’s trailer.
Faked success is an old tactic.
Andrew is doing something similar. But with one major distinction.
Andrew outsources his virality — making him nearly impossible to cancel.
In 2022, authorities searched Andrews' estate over human trafficking suspicions. Investigation continues despite withdrawn charges.
Andrew's divisive nature would normally get him fired. Andrew's enterprises and celebrity don't rely on social media.
He doesn't promote or pay for ads. Instead, he encourages his students and anyone wishing to get rich quick to advertise his work.
Because everything goes through his affiliate program. Old saying:
“All publicity is good publicity.”
Final thoughts: it’s ok to feel triggered.
Tate is divisive.
His emotionally charged words are human nature. Andrews created the controversy.
It's non-personal.
His opinions are those of one person. Not world nor generational opinion.
Briefly:
It's easy to understand why Andrews' face is ubiquitous. Money.
The world wide web is a chessboard. Misdirection is part of it.
It’s not personal, it’s business.
Controversy sells
Sometimes understanding the ‘why’, can help you deal with the ‘what.’

Josef Cruz
3 years ago
My friend worked in a startup scam that preys on slothful individuals.
He explained everything.
A drinking buddy confessed. Alexander. He says he works at a startup based on a scam, which appears too clever to be a lie.
Alexander (assuming he developed the story) or the startup's creator must have been a genius.
This is the story of an Internet scam that targets older individuals and generates tens of millions of dollars annually.
The business sells authentic things at 10% of their market value. This firm cannot be lucrative, but the entrepreneur has a plan: monthly subscriptions to a worthless service.
The firm can then charge the customer's credit card to settle the gap. The buyer must subscribe without knowing it. What's their strategy?
How does the con operate?
Imagine a website with a split homepage. On one page, the site offers an attractive goods at a ridiculous price (from 1 euro to 10% of the product's market worth).
Same product, but with a stupid monthly subscription. Business is unsustainable. They buy overpriced products and resell them too cheaply, hoping customers will subscribe to a useless service.
No customer will want this service. So they create another illegal homepage that hides the monthly subscription offer. After an endless scroll, a box says Yes, I want to subscribe to a service that costs x dollars per month.
Unchecking the checkbox bugs. When a customer buys a product on this page, he's enrolled in a monthly subscription. Not everyone should see it because it's illegal. So what does the startup do?
A page that varies based on the sort of website visitor, a possible consumer or someone who might be watching the startup's business
Startup technicians make sure the legal page is displayed when the site is accessed normally. Typing the web address in the browser, using Google, etc. The page crashes when buying a goods, preventing the purchase.
This avoids the startup from selling a product at a loss because the buyer won't subscribe to the worthless service and charge their credit card each month.
The illegal page only appears if a customer clicks on a Google ad, indicating interest in the offer.
Alexander says that a banker, police officer, or anyone else who visits the site (maybe for control) will only see a valid and buggy site as purchases won't be possible.
The latter will go to the site in the regular method (by typing the address in the browser, using Google, etc.) and not via an online ad.
Those who visit from ads are likely already lured by the site's price. They'll be sent to an illegal page that requires a subscription.
Laziness is humanity's secret weapon. The ordinary person ignores tiny monthly credit card charges. The subscription lasts around a year before the customer sees an unexpected deduction.
After-sales service (ASS) is useful in this situation.
After-sales assistance begins when a customer notices slight changes on his credit card, usually a year later.
The customer will search Google for the direct debit reference. How he'll complain to after-sales service.
It's crucial that ASS appears in the top 4/5 Google search results. This site must be clear, and offer chat, phone, etc., he argues.
The pigeon must be comforted after waking up. The customer learns via after-sales service that he subscribed to a service while buying the product, which justifies the debits on his card.
The customer will then clarify that he didn't intend to make the direct debits. The after-sales care professional will pretend to listen to the customer's arguments and complaints, then offer to unsubscribe him for free because his predicament has affected him.
In 99% of cases, the consumer is satisfied since the after-sales support unsubscribed him for free, and he forgets the debited amounts.
The remaining 1% is split between 0.99% who are delighted to be reimbursed and 0.01%. We'll pay until they're done. The customer should be delighted, not object or complain, and keep us beneath the radar (their situation is resolved, the rest, they don’t care).
It works, so we expand our thinking.
Startup has considered industrialization. Since this fraud is working, try another. Automate! So they used a site generator (only for product modifications), underpaid phone operators for after-sales service, and interns for fresh product ideas.
The company employed a data scientist. This has allowed the startup to recognize that specific customer profiles can be re-registered in the database and that it will take X months before they realize they're subscribing to a worthless service. Customers are re-subscribed to another service, then unsubscribed before realizing it.
Alexander took months to realize the deception and leave. Lawyers and others apparently threatened him and former colleagues who tried to talk about it.
The startup would have earned prizes and competed in contests. He adds they can provide evidence to any consumer group, media, police/gendarmerie, or relevant body. When I submitted my information to the FBI, I was told, "We know, we can't do much.", he says.

Jano le Roux
3 years ago
Never Heard Of: The Apple Of Email Marketing Tools
Unlimited everything for $19 monthly!?
Even with pretty words, no one wants to read an ugly email.
Not Gen Z
Not Millennials
Not Gen X
Not Boomers
I am a minimalist.
I like Mozart. I like avos. I love Apple.
When I hear seamlessly, effortlessly, or Apple's new adverb fluidly, my toes curl.
No email marketing tool gave me that feeling.
As a marketing consultant helping high-growth brands create marketing that doesn't feel like marketing, I've worked with every email marketing platform imaginable, including that naughty monkey and the expensive platform whose sales teams don't stop calling.
Most email marketing platforms are flawed.
They are overpriced.
They use dreadful templates.
They employ a poor visual designer.
The user experience there is awful.
Too many useless buttons are present. (Similar to the TV remote!)
I may have finally found the perfect email marketing tool. It creates strong flows. It helps me focus on storytelling.
It’s called Flodesk.
It’s effortless. It’s seamless. It’s fluid.
Here’s why it excites me.
Unlimited everything for $19 per month
Sends unlimited. Emails unlimited. Signups unlimited.
Most email platforms penalize success.
Pay for performance?
$87 for 10k contacts
$605 for 100K contacts
$1,300+ for 200K contacts
In the 1990s, this made sense, but not now. It reminds me of when ISPs capped internet usage at 5 GB per month.
Flodesk made unlimited email for a low price a reality. Affordable, attractive email marketing isn't just for big companies.
Flodesk doesn't penalize you for growing your list. Price stays the same as lists grow.
Flodesk plans cost $38 per month, but I'll give you a 30-day trial for $19.
Amazingly strong flows
Foster different people's flows.
Email marketing isn't one-size-fits-all.
Different times require different emails.
People don't open emails because they're irrelevant, in my experience. A colder audience needs a nurturing sequence.
Flodesk automates your email funnels so top-funnel prospects fall in love with your brand and values before mid- and bottom-funnel email flows nudge them to take action.
I wish I could save more custom audience fields to further customize the experience.
Dynamic editor
Easy. Effortless.
Flodesk's editor is Apple-like.
You understand how it works almost instantly.
Like many Apple products, it's intentionally limited. No distractions. You can focus on emotional email writing.
Flodesk's inability to add inline HTML to emails is my biggest issue with larger projects. I wish I could upload HTML emails.
Simple sign-up procedures
Dream up joining.
I like how easy it is to create conversion-focused landing pages. Linkly lets you easily create 5 landing pages and A/B test messaging.
I like that you can use signup forms to ask people what they're interested in so they get relevant emails instead of mindless mass emails nobody opens.
I love how easy it is to embed in-line on a website.
Wonderful designer templates
Beautiful, connecting emails.
Flodesk has calm email templates. My designer's eye felt at rest when I received plain text emails with big impacts.
As a typography nerd, I love Flodesk's handpicked designer fonts. It gives emails a designer feel that is hard to replicate on other platforms without coding and custom font licenses.
Small adjustments can have a big impact
Details matter.
Flodesk remembers your brand colors. Flodesk automatically adds your logo and social handles to emails after signup.
Flodesk uses Zapier. This lets you send emails based on a user's action.
A bad live chat can trigger a series of emails to win back a customer.
Flodesk isn't for everyone.
Flodesk is great for Apple users like me.
