and detailed system become profitable traders. Melissa Armo graduated Bank of Cum Laude from Gettysburg College with a BA in philosophy and a minor in Latin and political science in 1994. She was employed by several banks and brokers in Pennsylvania, Florida, Arizona and New York as a mortgage broker for 17 years. She changed careers from banking to pursue a security trading career in 2008. Self-taught day trader with over 10 years experience. Melissa especially is a trading strategy that focuses on shorting stocks that gap. Melissa also appears frequently on TV as a stock market expert. Watch Melissa on RT America, Cheddar TV, CBS, Fox News and the Fox Business Network. Melissa I bet after this year's mortgage market you're glad you got out of the business. Well you know what people are telling people hurry get in lock in your rate rates are going up I'm sure that's what the mortgage people said to people all year.  Oh god I hope they I hope you're not that's not true. No it's not true I just made that up but why why let the truth get in us in the way of a good story. Well thanks so much for having me it's a chilly day here in New York City we're supposed to get snow flurries if you can even believe it. You know it's pretty miserable here too in Silicon Valley we're getting a rare rain day and they're getting hammered up in the Sierra's with snow. So you have until five minutes before the hour I'm going to go ahead and mute myself and you have the floor. Thank you well welcome everyone so I'm going to look here at the chat so if anybody has any questions I will see them here on the side and right now you can see the slide here we're going to talk about shorting we're going to talk about trading for a living we're going to talk about shredding the side of institutional money and as John was saying it's been a very interesting day for the market really ever since 1114 so it was pretty much the week before Thanksgiving the market's been in a very tight range since it gapped up on 1114 we really haven't gone anywhere and actually we may not go anywhere for the next week because the Fed meets on the 13th one week from today and then they're going to announce what they're going to do or the anticipation of an interest rate hike or lowering rates or keeping rates the same or what they're going to do for 2024 even though the Fed has not said they're going to lower rates in 2024 the market in the last month and the month in November has thought that indeed they would so we had a rally in November and now we've been holding that rally even though we fell off today we actually started today with a gap up so it's been a choppy market in the last month unless you're looking for selective picks so we're going to talk today about how to find the right pick and we're also going to talk about shorting because I like to short see a couple familiar faces there you can just chat in the room and again for those of you that don't know me I appear on TV we've of course been talking about the economy all year and mostly the Fed and interest rate hikes and again 2024 is an election year so it'd be a really interesting year to see what happens with the overall market again my name is Melissa Armone if you want to contact me after today's webinar you can email me at melissathestockswish.com you can call me I do answer the phone or I return phone calls at 9 to 9 30 200 gap you can also follow me on Twitter Facebook YouTube or Skype so we're into the end of 2023 and I'm a very goal oriented person it's good to take stock of this year and be honest with yourself you can tell me in the room you can you know you don't have to tell anyone if you're embarrassed but it's really important to look at your year how was your year 2023 trading if in fact you traded this year did you have a good year did you have a bad year did you have a so-so year are you up for the year or are you down for the year this is the time of the year to start looking at that again there's no reason to wait for January to start to have new year's resolutions and to set the tone for the next year you should be starting to think right now about your goals for 2024 and if you didn't have a good year this year trading you have to think how can you turn it around and you really shouldn't be waiting to turn it around now is the time to really evaluate and be honest with yourself where are you for the year and did you accomplish your financial goals for this year or could that could you have had a better year than you did I have the stats in here for our year I run a live trading room every single day it opens at 9 a.m in the morning we trade between 9 30 10 a.m 10 15 in the morning these are all the stats for this year every single thing we traded all year so far to date 536,460 with an average risk on every trade of about three grand so these are trades on margin most of these trades are shorts we are going to talk about some of these trades today we had a really nice trade actually on Monday it was the biggest trade of the week which was meta meta had a gap down and fell that was a great trade I also trade options we will discuss a few options we're having a big year for options as well again I will do calls and I will do putts so this year again we did do shorts in the market as hard as it may believe we're going to talk about some puts we did in the market despite the fact the market was an uptrend yes I shorted the market this year I did options in the market I did puts and I made money in those puts okay so right now I'm not into anything in the cues or the spy because I want to see what happens in the next week but I have no problem you know doing something in either direction but I do prefer to short so we're up over two million dollars a year for the options newsletter that is a separate subscription I don't run a live options room those trades get emailed to you in live time but it's a very good time to think about where you want to be for 2024 focus on 2024 and prepare to have a better year next year no matter what okay so again this was a transition year for me because I was still unpacking I moved a little more than a year ago and I spent the first part of my 2023 year unpacking getting situated in my new neighborhood and ordered new furniture got all that set up so I'm finally ready to go into 2024 in my new home with everything everything perfect and to really just focus on my goals for 2024 so if you're someone again that doesn't like to think about things if you're the year didn't turn out the way you want you're not going to do yourself any favors by just by doing that okay thanks the truth of where you're at with your trading and say I know I can do better I'm gonna have a better year and then you have to do the things that that will make it happen for yourself because it's the American dream to become rich successful and financially independent and again when I say rich what that what that word means is different to everyone if I said how much money would it take for you to feel rich whatever you would put in the box would be different than what I would say as well and everybody has a different mindset about that but it's the idea that you are living the dream where you're not worried about money or even worried about going into recession or worried about high interest rates like we were talking about where you're actually financially independent and you are working for yourself which is pretty much what day trading is but you need a foundation to day trade you need a foundation you need a strategy and you need a foundation to train all right you need an infrastructure for every entry and that's the strategy the strategy is the core reason behind why you're even watching this talk in the first place whatever stock you're doing again I was talking about meta which we shorted on Monday but there's got to be a reason you're doing it or that you want to do it okay there has to be a foundation supporting it and for me the foundation is gaps but trading is a real job if you take it seriously if you don't take it seriously then you're gonna have a hard time being successful and you'll have some wins some losses and overall at the end of the year you're gonna be down because if you look at trading as something where you're gambling where there's a 50-50 crapshoot of every trade you take could win or lose those are not good odds so every trade I take I'm trying to put the odds in my favor that I'm going to have a winning trade so that's how I developed my whole thought process and system and again I've been training since 2008 so going on 16 years it's really hard to believe time just seems to fly but in the past when I was doing mortgages I wanted to find a new career and it took me several years to figure out the strategy I do now but I perfected it and I've been doing it for such a long time and nothing else now that I'm successful at it so I use one strategy daily to stay consistent my strategy is based on gaps I get up in the morning and I rate every gap that I trade or look at trading to determine if I want to trade it and then I try to narrow it down to the best pick this checklist is my reigning system I go through every single solitary debt and again that's how I chose the trade that we did on Monday which was meta what are we going to do tomorrow I don't know again we have data out in the market Thursday we have data out in the market on Friday we have the unemployment rate that comes out Friday but I'm not sure if the market's really going to react to any of these things in a gap up or a gap down that's going to have any traction until next week the market is teetering teetering on a tight route waiting for what's going to happen with interest rates and it's been very difficult for people who are long-term traders or swing traders right now to make decisions on what to do because again if you went along the market at the beginning of the 2023 you actually are up for the year I'm talking about when I said the market I mean the spy or the QQQ's individual stocks things have varied okay some stocks have had good year some stocks have had down a down year this year despite the market so I might do a different trade every day I don't know what I'm going to do to like get up in the morning and I see what is in fact gapping so let's talk about what is a gap we did this this week we did a put in Netflix so a gap is a difference between the close and the open it's 309 eastern time the market closes at four o'clock tomorrow morning on Thursday the market opens at 9 30 again I live in New York eastern time zone is where the market opens at 9 30 and then closes at four every single day money Tuesday Wednesday Thursday Friday in between times there's trading that goes off there's post market trading and pre market trading and again what happens is stocks can move the market can move during that time frame so what happened here with the Netflix and again I'm just going to go back and I'm going back to this is the end of November Netflix closed here at four o'clock gap down closed here gap down fell closed your gap down fell this was Monday so the whole market actually on Monday which was December 4th the day we did the meta uh fell okay and then we've been pretty much sideways ever since but this is a gap just to show you okay in this case here this is a bearish gap again I prefer it to short now you can do bullish gaps you can do bearish gaps uh we have done some bullish gaps recently too we did crowd you can look at that it was a really nice long move it was a bullish move we bought calls and crowd and we also went long as a day trade CRWD but anyways what is a gap a stock gaps with the opening price today is different than the closing price of yesterday's trading a gap is a break and price action from one day to the next simple so how do you find gaps anywhere there's millions of things that gap it's the whole idea of finding a gap that's a good one or what I call a golden gap or what is basically predictable okay so you can't short every gap down you can't go long every gap down you can't short every gap up you can't go long every gap up so I'm looking for something that I can qualify to determine the direction and that also will have a big move so here's the meta actually this was this was the one that we did on Monday so this was news actually this was not an earnings gap was a news gap so this was Friday the 1st December meta closed here gap down fell boom so we shorted it we got in got out so again this is a gap so this was Friday we closed here snug was above around 325 and change and four o'clock gap down in the morning here under 320 so around 319 318 and change or something fell dropped boom so this was profit again if you shorted it that was on Monday so here's the trade that we did this is a one-minute chart in meta again I run a live trading room I call the trades live in the room you can do them with me stack close here gap down dropped we shorted it got the drop rallied and got the drop and got out and that's it we were done one of the things that I've also perfected in doing this for as long as I've been doing it is I like to do fast trades again it it's it's just so much easier particularly in a market like this if you can make money early in the morning and be done in five 10 15 minutes a half an hour if you're waiting all day for something to move or you need the market for the move and the market flat lines or doesn't go anywhere or fakes out the direction you're losing in trades even in the last month okay so the best case scenario is always to get in and out of trades fast and one of the reasons that I prefer to short is because short moves happen fast so I like to trade fast and be done and the whole point again of shorting is that panic comes in very very quickly okay so one of the reasons that I prefer to short is that moves to the downside happen a heck of a lot faster than they do to the upside there's no emergency if someone says well do want to go long apple again you could have gone long apple this week I did not do it but apple did have a move I think it was yesterday there's no emergency if you want to go long you can think about it think about it think about it there's an emergency or a panic that happens very often in stocks when they're falling or the market because again there are there are gaps that happen in ETFs like gold has been rallying so that's another one you could look at the gold ETFs so again you can look at ETFs that are gapping you can look at stock symbols that are gapping lots of things gap and again I'm looking to get it out very very quickly so here was the train that we did in meta again this was a day trade this is a trade where you would have needed a margin account to do the trade now you could have bought a put and you could have got out of the put quick but this was the day trade we entered at 315 75 2000 shares was a risk of 3700 we added to the train okay this is an advanced concept but I called the out of the room at 315 99 total shares was 4000 average price here was street 1587 and again got the drop again I'm looking for momentum a dollar two dollars more so again this is a two dollar plus move again this is happening in minutes seconds and you could have made 8680 dollars so again that's getting in getting the rally and get the drop out done boom done by 10 o'clock and again I called this in the room so if you are day trading right now and you don't know how to capture these moves and you're waiting till after 10 o'clock to try to find moves again you're then you're pretty much waiting on the market and what if the market doesn't situate itself by 10 o'clock what if the market reverses you know and that's what a lot of people are seeing people get up in the morning like today they say well the market's up it's really strong that the market falls all day and then yesterday market was down they say oh the market's weak and then it rallies and then it fell into the close I mean this is the where we've been sideways the sideways action for weeks where you could get chopped up to bits and pieces okay you don't want to do that it's extremely important to be very specific about what you do very specific about the pick and it's not just the pick it's the entry so how did I know meta would fall again we're talking about Monday I rated the gap and met again gap down I use a 26-point checklist it tells me what to trade and what to look for each day I'm looking for qualifying factors in the daily chart in order to determine if I want to take that trade and again I go to the short side first but when I trade I'm looking for momentum this is what gives me an edge obviously then it doesn't matter if you have 2,000 shares or 200 shares or 5,000 shares or 100 shares of something if you get momentum you get a big movie at a dollar or two dollars or more that's what you want and again the quicker the better and I have an edge because I trade on the one-minute chart but momentum trading is one of the most profitable and fastest ways to make money trading learning how to take a position in a stock and anticipation at the stock will have an explosive move is extremely important because again many people are scalping particularly in a choppy market like this and then it's hard to cover your losses if you're scalping you never have any big winners and then obviously it's very difficult to even trade options because you've got to get the momentum if you're doing options because you have a time factor in reference to doing options but these enormous moves again the momentum moves that I'm looking for in the gap they can happen very fast and momentum trading is a very profitable way to trade and it is how you can make a lot of money in the market whether you have a small account or whether you have a medium account or whether you have a big account or whether you're doing options or whether you're doing day trades and the type of account you have and the way you use it again to take the position really depends on how much money you have because in order to take an margin trade you can you have to go to a retail broker you need 25,000 to get four to one margin or you have to go prop and you can open up prop accounts for this little is 2,500 and get 10 to one margin and there's prop accounts out there but you have to determine how you want to do the trade whereas if you want to do an option you can open up an options account and buy a put with a cash account and you can open up an options account with $2,000 any questions here so far I don't want to talk too fast everybody with me so far it's happening in the market on a regular basis however some gaps are better than others some gaps are nothing gaps and some gaps are very powerful displays of institutional money the most important gaps in the market are gaps that signify a change in direction or a bigger move in the same direction and understanding which gaps are meaningful and which gaps are not meaningful in the market will help you to know what to do and when a change is occurring and that's how you will know when the power of money will flow to pay you okay so again I'm looking for institutional money I'm looking for the footprints of institutional money in the stock in order to take a position in it how am I figuring that out I'm using my golden gap 26 point rating system and I figure all this out before the open now you can do it at night why because things gap at night there are some things that are going to gap tonight that we have earnings out from tonight I usually wait till the morning and again that's when the market usually gaps so I look at the market every day too but you only need one good trade today in order to make money but again I want to be with that institutional money big money in the market I want to be with the hedge funds I want to be with the large position player so everything we're doing is has volume every option that we do every day trade that we take everything because again we're looking for institutional money and the market has not made new highs yet this year okay so will it next week after after the Fed meeting maybe I don't know we're not that far away from highs but it's very very very very very very obvious in the last month and again next Wednesday will be one month since that gap up on 1114 if we really don't go anywhere on the date of Thursday or Friday which again we have the unemployment number Friday if we really don't go anywhere in that data which we might we might or we might wait till Wednesday if we don't that'll be a month of sideways basing where no more institutional money is behind the market because I want to wait and see what the Fed's going to say so again this is a really important week for the market so important and there's going to be a lot of opportunity to trade and make money in the next week how am I going to trade it I don't know I don't know until I see the gap okay and I just got done telling you I'm not in in any QQQ or spy trades I was in some over the weekend I was down in them Friday and they flipped on me on Monday my bias was we were a drop I was right and I got out of those with profit on Monday and now we've just been waiting this out this week but the market doesn't seem to want to budge and so that tells you that the big players aren't going long anymore right now they're waiting it's a standstill that's what we're that's why we're seeing this basing out basing out and and again how do you play that you can't it's just it's just it's like a nothing burger um how do you tell if it's a good gap or a fake gap I rate it I rate it I rate it using my 26 point rating system that's the system you've come and learned in my two-day class now I don't know what you mean by fake gap meaning I just mean I I didn't say fake gap I just meant a gap that isn't going to go anywhere if that's what you mean but that was a good question now again how can you do can you do this if you're a beginner yes you can learn from me from the nuts and bolts from everything in my class sometimes if people are new then they learn and they don't have any bad habits actually they do very well sometimes people kind of be there and training for longer than I'm alive and then they have a lot of bad habits and they have to get away from those bad habits so you know again it's something where the opportunity exists for you no matter where you're at in your educational level to learn something new whether they've been training for a long time you don't know what I know about gaps and that's what you're going to come and learn from me or you know nothing about training at all and you may have a learning curve and then you go through it then you go through it then you start small again if $2,000 is what you have and you can open up an options account and trade with it you're not going to risk $2,000 in one trade you're not going to risk you know 500 you're going to risk 100 200 start slow you're going to take that $2,000 account and build it to four you're going to take four and build it to eight and so on and so forth everyone that's a billionaire and everyone that's a millionaire unless they were born into money started took whatever money they made built their own businesses built their own wealth and took it from there this is common sense for some reason and I just I don't know why it's the gambling nature of trading or whatever you want to call where people just get sucked into doing things that they really shouldn't be doing and going hog wild and piggy with their risk and trades and then of course they dig themselves a hole okay trading is not a get rich quick type of thing it is something that is the American dream to be rich and financially successful yes you can do it but this means hard work it means time it means money it means an investment in your account not only in a class like mine but the time investment it takes to learn it and I'm not meaning I don't mean forever I mean whatever it is if it's winx if it's winx if it's months if it's months if it's a couple years at least you're better off in one year from now than you are right now if you lost money this year trading and you could know that 12 months from now you could be up for the year in 2024 and have a fabulous month whatever that amount of money would be even if it's 50 grand if you make next year say you make 50 grand you're trading part-time you have a job on the side that's an extra 50 grand that you don't have right now that you could have in 12 months so again if you are realistic and thoughtful about your goals still having wonderful fabulous goals but be realistic how to get there you're gonna be you're gonna be you're gonna be so much better because I think it's the unrealisticness of people where they think that they're gonna you know get free ideas and they're gonna make them rich you know coming to free lectures like today you're not gonna learn how to get rich in anything today you're gonna learn in a class where you study and you focus on what you do it and it takes hours but it doesn't have to take forever and it's a good investment of your time when I when I started trading I thought it was gonna take me six months I said I'm really smart I can do this in six months and then it took me three years so I mean you don't you don't need to take three years you can learn my system in a weekend now you're gonna go start making money right away as well if you're copycatting my trades in the room you could but you're still going to have a learning curve and I don't know what that is because I don't know you and then I get to know people and you come back and you answer questions you ask me questions and I answer them for you and so on and so forth so again that's the point of the support of the trading room is that I'm there every day where you can ask me questions but you are still placing the trades you are still have to be thoughtful about your risk and again you can't have piggy targets and things because it's gonna come back to bite you in the butt especially in a market like this which has been basing out for the last several weeks now we all we did do Tesla this is this was in November this was before the Tesla truck thing and everything else we had a nice put in this but I haven't touched this since then we bought Tesla puts so this is the newsletter comes in your email inbox we did this in 1116 this was in the afternoon uh it's rare I sent a trade in the afternoon but I did we bought the 230 Tesla puts it expired on the 24th this is the following week out this was the week of Thanksgiving the cost four dollars now if you had a smaller account and you bought three and risk 1200 you could have made $100 I took a trade in and out so let's look at the 16th here let's look at the Tesla chart the 16th was here take it up see the gap stock close to your gap down take it over again we did the 230 so it dropped into it it dropped into it down boom cut out again I'm this isn't long-term trading where we're buying it and or shorting it and holding it forever this isn't swing trading we're chunking it out we're making money we're taking it get in get out we're taking the getting momentum get out again why we get long or whether we go short so again this is not swing trading we have to wait okay this is active income making it proactive get in the trade get the move get out and that's again why the idea of risking $300 $400 $500 we're having a small account there's nothing wrong with that I mean if you made an average of $500 a day there's $2,500 a week what's wrong with that nothing nothing again it's a lot of people I think especially with the with all the things that are going on with some of these stocks that have had the booms in the last couple years like with the reddit chat rooms and GME route where people have become millionaires just by trading one stock that that is not the norm that was an anomaly okay you can build wealth and get good at doing this you take the amount of money that you have and you make it work for you by turning it over and over and over and over and over again and we're looking for one to one so have a risk $500 I'm looking to make $500 if I risk $3,000 I'm looking to make $3,000 50% is even good in a market like this in December where we're still waiting for the market to do something but you must have an edge to be successful online is spotting momentum before the move occurs because again after the fact it's too late it's too late and you can't chase it now we also have been doing BABA BABA has been a slow bleed down so we shorter this is the day trade we we did a couple puts in this too so this was a day trade 1129 we shorted it on margin again I called it in the room 7480 dropped we only made 30 cents in this it was a quick in and out one but it was money there wasn't much to do that day it was 1129 right in here stack close here gap down open rally we got in got out done boom but it was money and again sometimes you just take what you can get especially around the holidays now we did do the 77 puts we did the 75 puts we've done a bunch of puts in this they've all worked they've all worked you could still be in them uh so this has been a slow bleeder in the BABA here was a day trade stock close here gap down this was 1129 rally and again got in got the drop and again this is the momentum this is the move you could have gotten out here so that was back at the end that was last week actually I guess I think that was a week ago it was Wednesday so again shorting is fast institutional money equals big money in stocks big money in the market that's how it moves things this was a recent trade that we did this was one of the biggest trades we had this week I'm out of this trade we're going to go over it I called it last Thursday 1102 in the afternoon I sent this trade out if you're on the options newsletter we did a put in Google it was the 134th strike that expired this Friday but you should not be still in this I don't know why you would be and again it was a put so let's look at it so that was 1129 so here we go boom and boom do so remember I was talking about Monday so again you see what this did from Friday to Monday this is the Google take it over you see how this broke 130 on the 4th so that was a nice trade a nice trade and that was a short okay so again a put is a short a put is a more economical way to actually take a trade so the cost was $1.50 which was cheap considering this is over $130 stock number of contracts I'm going to give you the advanced trader risk and beginner risk if you risk $9,000 you could have doubled your money I made $18,000 and this was an exit on Monday I don't know where Google is actually trading today a beginner risk if you'd risk $1,200 you could have made $2,400 and again this is a great example where you could take an account like five grand say you have an options account or $10,000 if you have an options account you certainly could risk $1,200 in one trade if you have $10,000 in an options account and then you could have made $2,400 so you could have made basically almost 25% of your account in one trade you would have had to hold it for like two days through the weekend but this was a nice call this was one of the biggest trades this week it was a 200% return investment and again it's just you just let it go you ride it out okay could have gone the day I called it could have gone the next day you you just let it play out that's how momentum is the momentum just goes you can't force it just like you can't force something if something's down you can't force it to go and just like if something's up you can't force it to go any more than it's going to go but you have to make money on a regular basis if you want to trade for a career you need more winners than losers and so I'm following the moves that institutional money makes in the market then I'm cashing those moves in a small time frame in a small period of time daily and again I've been teaching people for long enough now as well I've been trading for a while but I started the business in 2012 so I've had the business now for 11 years you know you you a lot of people trade and they think they know whatever they think they know ABC they think they know how to go long they think they know how to short they think they can buy every dip they think they know whatever they know they think it's right and they think they know whatever they know the fact is you don't know what you don't know because you don't know it so it's like what I found in teaching people in all the years I've been is you don't know what you don't know and you won't until you do. So it's you know this is one of these things to try to describe to people. You're not gonna know the information that I know unless you sign up for my class. You may think that you take a good trade and yet then the trade loses nine times out of ten. One time it wins, nine time it loses or 50-50 whatever. You're like well I've done this before and it's weren't. Yeah sometimes anything works. Sometimes crappy trades works. Okay that's not the consistency that you need. In order to have these kind of stats that I showed you at the beginning of the year where we're out for the year you've got to be consistent. You've got to make more money than you lose. You have to have more winners and losers and you may think you're doing things at work but they don't because you're not consistently winning. At the beginning I asked assess your year. Look at where you're out for the year and be honest with yourself and then you can move forward and make changes and do better in 2024 because you should want to do better. Otherwise what's the point of doing this? While trading is fun losing is not. Making money is more fun than anything. It's not fun to lose. It's fun to win. It's fun to be successful and then you have money to do things and do other things with your life and again the nice thing about trading is that the time that it takes you to do it is just not that long. I mean even if you settle a day which I don't six and a half hours is only hours the market is open and we usually only focus on the morning. But does everyone get the point I'm trying to make? You don't know what you don't know until you know it. And that's just like you know when your eyes wide are wide open then you realize oh yes now I see it. Now I understand kind of thing. But anyways getting into the speaking about institutional money and let's talk about shorting. Whatever the benefits. What are the benefits of shorting. It's fear. It's panic. What do you think is gonna happen and I'm not saying this is going to happen. I'm saying it could happen. What do you think is gonna happen if Powell next week a week from today right around this time on Wednesday says that in fact they are gonna raise rates in December. No one. No one on TV that I'm on with no one TV that even on even with people I'm not on with no one TV is saying that that's even a possibility. In fact the market hasn't priced that in at all. If he raises rates in December and says we need still need to bring inflation down we're gonna raise rates the market's gonna sell off like a hot cake. I mean the market's gonna panic we panic city USA because no one thinks that he's going to do that. I don't know why no one thinks that he didn't say he wasn't going to do that and no point in time as he'd even discussed lowering rates in 2024 which is exactly why the market rallied on November. Everyone said that he's gonna lower rates in the spring. He never said that. If you listen to the exact things that Powell said he hasn't said that and in fact I read an article the other day I forget what it was Bloomberg or CNBC where someone said that Powell's lost lost control of everything because people are just making stuff up and saying it and taking positions based on nothing that he's saying which could come back to bite them because he could raise rates in one week. I don't know if he's going to I don't know what he's gonna say. I'm flat waiting but I'm telling you it will create panic that will sell off the market and then he would want to short and again this is the other benefit of knowing how to short and knowing how to short well because you don't want to short everything you don't want to short all the time you need to find the right things too short just like you got to find the right things to go long you don't want to go long everything either even when the market's in an uptrend even when the market's rallying. So anyways institutional money is in charge of the market and stocks at all times. A big flow of money going a certain direction is when moves the market stocks and creates momentum and then sets the trend in charts. When you're looking for institutional money you're really reading the side of power in a stock. So if a stock is moving up the side of power is with you you want to be long vice versa you want to be in the side of the power in order for you to make money trading because that's how you're going to make money. If you're against it you're going to lose. Institutional money is in charge of the market and stocks at all time and even if there's a temporary what seems like a temporary change it you're going to end up losing anyways because it's temporary. So you have to become a specialist in defining institutional money this is a chart of Walmart. We did a bunch of trades in this. This has been a nice short so you could have done puts in this you could have done day trades in this we did both this was back in the middle of November back in here was the 16th so Walmart closed here gap down open fell so again this was a day trade short you could have bought a putt and it was a nice move to the downside again volumes down here the red bar depicts the selling so what happened here institutional money sold off the Walmart in fact they've been selling off the Walmart I clip this for today this is today I don't know where this is closing it doesn't matter today the Walmart will close red okay so again institutional money has been selling off Walmart and if you learn how to read the footprints of big position players before the momentum occurs you can take the position in the right direction then you get out after the move happens and then you profit and again we're doing quick moves and even the options I'm doing are weekly options so that's fast to me but you have to understand how to trade with the side of power and you need to know how to find it it's very important to find it because this power has the ability to pay you it's not hard to make money like if you short a Walmart you just ride it out like on Monday you short meta ride it drops two three dollars boom out the market has the ability to pay you you just gotta know what to do and again going back to what I was saying you may think you know what to do but you don't if you're losing and you don't know what you don't know until you know it so knowing how to read what institutional money looks like it's essential to become a successful trader and you can win big trading the side of power and again how do I do this in gaps now this was a put we did it was a month ago we shorted the spy we shorted it in October was October 25th we'll look at the chart in a minute it was this five was a little pricey 470 shoulded at 950 102 percent was a good trade if you took three contracts again you could take one pay 470 dollars you could have sold at 950 again the nice thing about doing options is you don't need a margin account and if you had done three would have made $1440 so let's look at this October 25th to 420s oh this was the end of October market close to your gap down dropped boom boom boom so again see where we are I called it above the strike got the drop boom boom again this is the sell-off this is the momentum you see what it's happening it feels like a long time ago now doesn't it though since november's uh gap here was the gap I keep talking about again this is the spy I could have the spy up I could have the queues up I can have either one up market close to your gap dot and what was all the hype at this point that basically everyone was saying it was almost like like they had just lowered rates that this was a ridiculous gap in the market and actually it made no sense to be honest with you but everyone believes that in fact they are going to lower rates now in the early part of 2024 I don't think that but a lot of commentators and analysts do so we'll say but we did a nice short here in the market in october october was a great month september was a good month we captured those moves to the downside in the market when it was selling so again golden gaps have huge opportunity because they spot the power money that's how you're going to have a big move because there's only one thing and one thing only that can move the direction of a stock it's money not a little bit of money but a lot of money or what I call power money it's like the difference between a bulldozer and a little bitty car okay power money is in charge power money is in charge of the stock's direction and you can see the lack of commitment right now actually in the market there's who's in charge you're trying to figure it out you're like one day you're like oh the bulls are in charge then you're like no today the bears are in charge and you're like no I don't know the market's flat right now range bound and again tough to trade if you're looking to get it but the reality is something should be very obvious when there is someone in charge and trends are set to move by the power money people which is a lot of in the market again there's there's many many many different funds in the market I'm saying you know hedge funds there's small ones there's big ones just like they're smaller big traders just like they're small and big retail traders oh we did we did the 80 babas too we've done so many puts in this look I forgot we even did this one this was in November 16th we've been doing this for a while we did the 80 baba puts across two dollars it's just so cheap and again Baba is something that trades in another market you just do it and you just ride it and you capture the move overnight so sometimes I'll hold an option overnight sometimes I'll get out the same day it's really how big of a move it happens on that particular day and whether or not I think we have the market with us so let's take a look at it November 16th 80 Baba oh that was here stock close here gap down right there it is boom so again you can hold options overnight with a limited risk in this case here if you took five your risk was what a thousand dollars even the trade to go on bust it didn't it worked it gap down the next day you were profitable as soon as you woke up in the morning but if it hadn't worked you would have lost a thousand dollars that's it so it's a fixed risk it's a lot different than a swing trade but as soon as you get up in the morning on the second day it was at 77 it was three dollars in the money and again that's the nice thing about options if you hold them overnight but it's all about chunking them out you take it chunk it get the move get out take it get the move get out whether I'm doing a day trade whether I'm doing option any trade that I take I'm looking to trade the momentum again I prefer to short because short moves happen fast but I will go long like I said we went long crowd we did calls in crowd we did a day trading crowd could have day traded crowd today actually crowd gapped up today made another move the system I used to find the right gap each day though is the golden gap 26 point checklist this is the system that I created over three years of my life this is what you'd come and learn from me if you want to take my class there's only one more class this year 2023 again the year is almost over I the last class of the year is December 16th and 17th this year I just feel like for me personally has just flown by and you know 2024 who knows you know this year was bullish in the market though you cannot deny it and no matter what happens next week even if we sell off the market will close with a gain on the year but you if you want to trade can trade in any market bullish bearish you can short and go long I prefer to short but either way we will do bullish gaps but you just got to find the right pick every day and this is where some people like I said they missed the mark they don't know what to focus on or they need the market and then they don't get it so if you want to make money in the market you need to think and act like a true professional this is true even if you're only trading part time but if you want to do this full time where you this is your only source of income you must be consistently profitable and if what you're doing for 2023 is not working then what you're doing has to change or you will go into 2024 having the similar year or worse you want to have a better year that means you got to change professional traders have specialized strategies systems and reasons for taking trades and it's about the daily focus for me but once you learn how to find momentum making money really isn't hard it's determining where you want to get out you want to hold it you want to do the ad like we did in the meta you want to get out quick do you want to get out of half do you want to do an option do you want to do a day trade those are decisions you can make how how much size you want to take in something but actually getting up and actually becoming profitable is not hard once you qualify and know what to do and then when you take a loss it's not the end of the world again in the stats i show at the beginning you'll see the losses in there but we don't have as many losers as winners we have way more winners you won't get upset if you lose money in a trade-on one day knowing that tomorrow you're going to make money and probably the next five days so that's where the confidence of the conviction in what you do really takes hold and that's where you get out of that whole gambling mentality which so many people are in because they've been losing losing for so long not just 2023 but prior years that they start getting into that gambling mentality and ironically and again i know this from teaching people ironically the people that are the most tend to go with the gambling mentality are people that are trading for a long time for some reason and don't know the right stuff and don't have a lot of money you know so they really can't afford to be doing the gambling although no one should be doing it even if you had a million dollars cash in a unit trade and counted a broker he shouldn't be gambling you want to use that money very wisely to turn one million into five okay so you've got to focus on one strategy to be effective and not only effective efficient so every day i'm looking for stocks to trade that have number one a high probability of directional bias for the entire day preferably like the walmart big moves on the day okay that's what i want early confirmation of my bias and the move between 9 30 and 10 because i want to do the day trade and the option and precise entries with follow-through and a good risk to reward which to me is one to one i'll take 50 percent though in an option i'm okay with that too especially over the holidays hanukkah starting soon then we got christmas it's december it's new year's you got to be careful trading you got to be careful trading right now you got to be patient and like strike you know um i live along central park actually as i'm talking to you here i just saw the hawk i haven't i hadn't seen him in weeks and i just saw him as i'm sitting here this afternoon so that's a great sign because i was wondering if he if he migrated in the winter because the weather has changed but anyways when the hawk goes after his pray he die bombs down and gets it to go for the kill and that's really how you have to be when you trade and it doesn't matter if you're trading options and it doesn't matter if you're day trading it doesn't matter if you're taking a thousand dollar risk per trade or 10 it's the whole idea that you have to go after it like that and you have to grab the money and get out again this is active income where you're chunking it out we're not buying and holding forever okay and swing trading right now is killing people with this market in the range and it really is all year because even if you bought early in january and say fine you bought in january got out the end of january beginning of february fine but i mean i showed you how the market fell in september and how the markets fell in october and the last six months has been killing people in reference to swing trading so options are better to do the overnight moves because you do have that fixed fixed risk but you still have to pick and choose what you're doing so to analyze a large time frame is what i'm looking for when i rate the gap i get up in the morning or rate the gap based on the daily and then i make a decision what do i think the directional bias is for this gap will it move up will it follow through lower okay then i take the trade on the one minute chart but you know i'm always looking at the daily and then i enter it on the one and that's how i'm getting the high degree of focus and accuracy once the market opens and i'm using the daily chart to make the decision for the stock pick which allows me the accuracy in the direction but then the one minute where i can hone it down to get the risk to reward in my trains so if you decide you want to come and learn from me and take my class again the last class for the year december 16th and 17th you will learn my 26 point checklist the rating system how i make the picks and again this is something that you can use on your own i don't hold anything back i teach the entries and the exits in the class as well so the 26 point golden gap rating system helps you pick which stock to trade each day it pin points ahead of time which stock will have the move in the day with volatility you treat you prep in the morning before the open have it ready go through and rate it before 9 30 and then i know what i'm doing or what i'm not doing and then i have a couple picks hopefully more than one or maybe one having a checklist keeps you organized and focused and that is a professional way to do it that moves you away from the gambling mentality and having a checklist forces you to look at what you should be looking at in a chart in a stop to make the correct direction having a checklist helps assist you with directional bias which you need and you got to get the momentum too and then having a checklist keeps you on track to reach your goals again 2023 is over in less than a month have you made your goals for the year have you fallen short have you exceed your goals you want to make more money next year either way okay and how are you going to do it you need a plan of action and a checklist is a plan of action everyone that puts money into the market should have a plan of action and a checklist on a professional level all high income career field specialists have checklist you go in to get surgery you there's a checklist you got to go through things you have to do stop eating at this time stop drinking water do this okay any questions here a few more minutes I'm almost done but gaps are created with large institutional money that's what makes the gap in the first place and professional gaps that happen plant stocks by form by one thing one thing only large institutional money therefore you need a way that will help you pick the correct direction to play the gap you confirm the large money will flow with it and then by having a formula to rate and qualify the gap you get confirmation and then conviction that the large institutional money is on your side and you play it gaps are an event they create a sense of urgency and again I prefer to short because that emergency panic that the sell-off is what you're shorting okay and then in action it's forced by participants of the stock again whether it was up or down and that's why graph training is incredibly incredibly powerful trading gaps is a powerful and profitable way to trade because you're trading on the side of power money and that's what you want okay so don't waste time trading without getting anywhere so many people are doing this for years and they're back and forth either making a little losing a little or a break even it just makes no sense again another calendar year is almost done we're getting into a new year soon you want to move forward with your life you want to get to the point where you say I did it I know what I'm doing I'm finally getting somewhere with this all this years that I've done this is it counts it matters okay it's having the right knowledge having the right focus how are you going to get it you've got to learn from an expert from someone like me who's been doing this a long time and for me I'm an expert in gaps I'm an expert in shorting I'm an expert in momentum because that is my focus it's what I've been doing for a very long time and time is just too precious to waste and the older you get you realize that yeah again I don't want to trade for six and a half hours all day my eyes get tired and I have other things to do other things I want to do with my life so again it's it's really perfecting it putting the time and energy into it to get to the point you're good and then you can have the lifestyle that you want financially and also the time-wise lifestyle but you will come and learn the checklist if you decide to take my class and in the class you will learn the strategy of the 26 points teaches you how to play the stock teaches you chart analysis and technical analysis on an advanced level I think it's very important in today's world to really empower yourself because you never know I think everyone should learn after COVID you never know what the future may hold and you have to be in charge of your own life and your own finances and your own money so the golden gap course is a whole system it's not just one thing you will learn the strategy the method you can use it for day trades you can use it for options and remember this time of the year when everyone's buying presents for everyone else you can buy a present for yourself education is a gift to yourself I'm pretty much done Christmas shopping I took advantage of all the sales which were running early this year even before Black Friday but I also bought some things for myself because things were on sale you know I mean this is the time of the year sometimes we need to be good to ourselves as well as our family and the people that we love and education is an investment in you and your future and what you're doing so if you decide to come and take my class it's called the golden gap course it's a full two-day course on how to strategically find pick-and-play stocks in our professional bearish gaps classes online can be anywhere in the world and take it so the last class for the year like I said is not this weekend next weekend December 16th and 17th 9 a.m to 5 p.m eastern time class tuition is 69.99 classes online you can be anywhere in the world and take it I am doing a package for everyone speaking of holiday specials this is going on through Friday I've been running it this is a nice package for new people if you sign up by December 8th for the golden gap course combo the tuition is 74.99 you will get the golden gap course and the trends course and you will get the trading room free to the end of 2024 the newsletter the options newsletter free to the 2024 and the market report through the end of 2024 and the gap options course you will get free that is in February the trends course is in January and then the golden gap is in December so this is one price for all of this this gets you all my trades for the next year to the end of 2024 and again it's a really really really huge package for the price but I've taught people that I've never traded like I said I've taught people that I've been training forever here's some testimonials any questions from anyone someone saying good luck good luck to you as well any questions from anyone if you do have questions you can email me at melissatheswitch.com if you would like a trial for thursday or friday you can email me as well if I don't see any of you have a wonderful wonderful healthy happy holiday season and happy new year okay melissa thank you very much


everyone, and welcome to Hawaii Together on the ThinkTech Hawaii Broadcast Network. I'm your host, Kelea Akeena, president of the Grassroot Institute of Hawaii. You know, we live in paradise, but there's the other side of paradise, the fact that so few of our residents are able to afford housing. Well, there's no lack of solutions that are offered, but not all of them will really work. One of the solutions that our county and state officials are looking at happens to be a program based upon Singapore's model of housing in which the government itself owns the land in the building and leases out apartments to residents. That may be a short-term fix, but in the long run we think there are some serious problems with it. But we don't want to be naysayers. At the Grassroot Institute we want to come up with solutions that will work, and so we scour the country and the world for those solutions. One such solution may very well come from Tokyo. The highly populated city has shown that deregulation rather than more government management can help communities keep up with the housing demand. So if Hawaii wants more housing, it may wish to follow Tokyo's example and roll back regulations or on land use and housing development. My guest today is an expert in this subject matter. He's senior fellow and director at the American Enterprise Institute Housing Center in Washington DC. His name is Edward Pinto, and I'm so glad that he's joining us today to give us a bit of his expertise. Ed, welcome to the program. Aloha, and thank you for having me. Well, Ed, I can't wait until you fly out here to Hawaii, and we don't have to do this on Zoom. How's that sound? We're planning on doing that. That sounds great. Tell me a little bit about your background in the subject matter and why you have an interest in what we call the Tokyo model. So I've been involved in housing finance, literally my entire career. And before I graduated law school, I was involved in housing a bit. I was involved in it at law school. And then my first job was in working for the state housing finance agency as an attorney and affordable housing. So that's been my entire career. I was the chief credit officer and executive vice president, Fannie Mae, back in the 1980s. And for the last 14 years, I've been a senior fellow at the American Enterprise Institute, and I founded the American, the Housing Center back in 2013. And the purpose of the Housing Center is to study housing markets in the United States on a database and research based way. We've assembled what we believe is the best data set in the entire country about the United States, including all 50 states. And we use those data to come up with solutions. We call it data yields information, information yields knowledge, and knowledge yields potential action. And we do a lot of research and we've looked at Tokyo and many other situations that might be applicable and useful to Hawaii. Well, I like your emphasis on data because we can't simply have an ideology or philosophy. We really have to look at the world as it is in order to find causes to the problems and solutions. One of the things at the Grassroots Institute that we have recognized for quite a while is that many people are leaving Hawaii because of the high cost of living. And the most significant component of that is the high cost of housing. And for those who remain in the state, there is a high population of residents who don't own their home and don't have security in terms of long term residency. Now, you've looked at the states across the nation. As you look at Hawaii, what do you think are some of the causes or perhaps even the chief cause of the high cost of housing? First of all, as you say that Hawaii does have a high cost. We looked at out of all the states, Hawaii has the highest median home income, the second highest median rents, the second highest rate of homelessness per capita. On a national basis, it is extraordinarily high from a price to median income basis. And out of 92 international markets, Honolulu is number 86. And it ranks just behind San Francisco and San Jose and is ahead of London and San Diego in terms of being one of the most expensive international destinations. What we think basically creates this problem. And it's a very similar problem that California has. And many of the cities that are similarly ranked to Honolulu are in California. And there's a reason for that. California and Honolulu followed similar patterns, which was to put in land use restrictions, zoning, land containment zones, other restrictions on types of structures, restrictions on density, beyond zoning, restrictions on building codes, et cetera, that have been present in California from the 50s and 60s and in Honolulu and Hawaii since the early 1970s. And so we see a very similar pattern between California and Honolulu and Hawaii. And what's interesting about California and colleague of mine, the assistant director at the housing center, Tobias Peter and I wrote an op-ed a couple weeks ago in the Wall Street Journal, where we pointed out that after trying all the other options, the state of California is now finally embracing the free market and property rights. And they did that two ways. One is they over a period of years greatly expanded the ability to build accessory dwelling units, which are now burgeoning throughout much of California, particularly Los Angeles and San Francisco. And secondly, just last year, late last year, took effect January 1st this year. They legalized the building of a second unit, which could be either a second single unit or a duplex to family and lot splitting of individual lots throughout about 80% of California. And that took effect just in January of this year. And so if California has recognized that they need to allow the private sector and property rights to operate, it's time for Hawaii and Honolulu to do the same. Well, Ed, that's very interesting. And in my own opinion, I I'm not so certain as to how much California as a state or state government is acknowledging the philosophy of property rights and principles of individual property ownership. But they've been pushed there at the very least. What California had been doing just wasn't working. And so pragmatic solutions are necessary. Just to go back a bit, you said such interesting things about the role government plays in interfering with housing availability. Talking about the Hawaii situation, would you say that government regulation is a big part of reducing the supply of housing, which leads to its high cost? Absolutely. And we found some data that show that Honolulu and individually and other islands, counties and islands in Hawaii had robust housing construction up until about 1972 or 1973. And then it collapsed after that. And it's never recovered. It's been declining ever since. And we attribute that to a number of things, the State Environmental Policy Act of 1974, the impact of land use commission was established in the 60s. Interestingly, this is very similar to what happened in California in the 60s and early 70s, which had in California in coastal California had a decline is even predates what happened in in Hawaii. But starting in the early 70s, interior California started having substantial compliance also. So again, we see a lot of parallels. And it all comes down to land use and making things illegal. Basically, building new housing has been made illegal. Reasonable density, we call it light touch density has been made illegal. Having two units on a lot is illegal. And all of these things just drive up the cost they drive up the land cost. And now Honolulu has land cost that are commensurate with the price per acre that California has. And again, if you have if you force the land cost up artificially, then that's going to force the price of the housing up. You talk about forcing the land cost up artificially. I like to think of it also as producing an artificial scarcity of land. We like to say that the reason that housing is so expensive is that land is scarce in Hawaii. But our own research shows that we actually develop on about 90 about 5% only 5% of the land mass leaving 95% undeveloped regulations tend to have that that effect. What do you say to people who say we have a scarcity of land? I don't believe there's a scarcity of land at all the United States of any country in the world should have housing that is economical. We have more land. And we've only used for residential purposes, you cite Hawaii at 5%. I think for the country, it's probably even less. And we have lots and lots of land compared to virtually any other developed country in the world, we have tons and tons of land. That's number one. And I agree with the suggestion that the grass root institute has made that by freeing up just one or two percentage points of the land that's not available for residential for it's not even residential construction. It's not developed. The rest of the land the other 95% is agricultural and concern in conservation. And so if you were to increase from five to 7% or 40% increase in the amount of land that's available, that would drive down the cost of housing tremendously in Hawaii. But secondly, the land that is at 5% we've looked at that. And we have found that the zoning and the residential zoning is what we're talking about. And it's usually called 3, the 3,500 or 3.5, 5 and 7.5, which has to do roughly with the lot size and the required square footage for a structure. And what we found was that while technically, two family housing houses are available to be built on that you can build it within the zoning. However, the density that's required is usually 50 to 100% more land. Well, that defeats the whole purpose. If you're on a lot of 5000 square feet, you want to put two two family rather than one on it, you now need 7500 or 10,000 square feet in order to build that. Well, that drives the cost rate back up. So we've calculated that if you were to have a triplexes allowed broadly in these 3.5, 5 and 7.5 residential zones, which is most of what, for example, Honolulu County is owned as or those three zones, if you were to allow the triplexes duplexes and triplexes and lot splitting, which allows you to take a 7500 square foot lot and divided in two, you could add 26,000 units over an estimated 10 years. Well, that's how that would go a long way to meeting the shortage that the Hawaii Realtor say, I think is something like 80,000 units. And so we think there's lots of land options. It's just you have to make it legal and you have to free up the land. Well, Ed, we both recognize the role that government regulation is playing in creating this artificial scarcity. And there are a lot of practical solutions that are available. Yet it seems a little bit dismaying at times that legislators are looking at solutions that have practical problems to that one is a solution called the Singapore model. You're familiar with that. And a couple of the features include the fact that it's the government acting as the landlord leasing out apartments to people who don't really have a wealth generating capacity in terms of being able to buy these as fee simple. I could go on with some of the features of this model, but what are your thoughts about it? And it's suitability for the Hawaii market? Well, just to be very succinct about it, I don't believe it is feasible for the Hawaiian market. It is appealing. Why is it appealing? Well, Singapore is a home ownership rate of 80%. That's very high. 80% of the residents live in high quality housing that is really high rise flats that were developed by the government. However, Singapore is a very cohesive society. It has racial cohesion and income quotas that are associated with Singapore housing. The housing is relatively affordable through a program that's funded like Social Security. There's a large tax that everyone pays that's used to cross subsidize. And most importantly, perhaps, there are strong macro prudential regulations, regulations by the government. Partners in those buying second homes can be charged increasing large duties. And you also have the fact that the government is a city state, unlike Hawaii, which is a state within a federal system and Hawaii County is a county within a state, the city state with an authoritarian former government and a highly effective public leadership cadre that goes back. It's a one roughly one party system that goes back decades and decades. The government owns the land and therefore they're able to put this in place on a very small what is in effect a small city state that they control virtually every lever in the state. We think if that were tried in Hawaii, a it might not be able to be scaled. That's a big, big question. It would take a very, very long time, which I don't have a big problem with that, because anything to solve this problem is going to take a while. But the failure could come at a very heavy cost. Yes, we could be like the public housing debacle that we had the United States. That was a disaster. That was a combination of federal, state and local efforts. United States has a history of failing in these buildings supplied by the government. It's expensive to build and particularly I think in Hawaii or any state because there's going to be unionization requirements, Davis bacon requirements, other things that that require that housing be very expensive. And there's also a history in the United States, unlike probably Singapore, where things are not done within budget. We all know about the the bridge to nowhere we know about the the train that's in California that's three or four or five times over budget. We know about the big dig in in Boston. It also lastly, I think isn't really what's needed by the tenants. It really traps the tenants once they're in, they really have a little limited ability to move. They're not really building equity in the traditional sense, thereby reducing mobility, and really reducing wealth creation. And I'm not a big fan of unbridled house price appreciation driven by government policies, but I am a fan of building wealth the old fashioned way, which is you take it alone, you pay it off and you get equity. And that's the way it should be. Well, Ed, we tend to view the Singapore model in the same light. But we don't want to be naysayers. When government leaders propose something, we commend them for trying to find a solution. But what we'd like to suggest is there may be solutions elsewhere. Tokyo, on the other hand, could very well have an approach that could be used here that involves the private sector rather than the government. Why don't you tell us a little bit about the Tokyo model? Yes, and we can bring up that's graphic now. So this is a change in house price and population over a 20 year period for four cities, London, Tokyo, I'm not actually sure where this Minato is, and then San Francisco. But what you see is the blue bar, our house prices, and nominal prices, and the orange bar are the his population. And you see that population, let's focus on London, Tokyo and San Francisco has barely grown in any of the three, but the house prices have gone up tremendously four and a half times in London and well over double in San Francisco. And that was just through 2015 is about the worst since whereas Tokyo, the house prices are actually basically flat. And a population is roughly flat. Also, we have other data. And what happened in Tokyo was under their constitution, which was set up by the United States government after World War two, it provided property rights. And those property rights were finally recognized pretty fully in the 1980s. And part of the property rights was that you could develop your property, as long as it basically wasn't disturbing someone else. It wasn't a nuisance. And so you could build, there was very tremendous limitations on zoning, you could build a more intense development next to a lower intensity development. You could build duplexes, quadruplexes, triplexes, high rise buildings. And so as a result, Honolulu has built, excuse me, I mean, Tokyo has built more housing than in a period than the entire state of California by multiple. And so Tokyo has been able to meet the needs of their population, meet the needs in terms of a cost, keep it affordable, both for rents and home ownership. The units have actually gotten larger over time. That's one thing they were well known for was relatively small units, they've gotten somewhat larger. Whereas everything's going in the opposite direction in a place like San Francisco and Honolulu. And what are some of the quick takeaways that Hawaii can learn from the Tokyo model and apply? I think the quick takeaways are you have to make development legal. And now there may be a desire not to allow high rise construction everywhere. But you should be looking at what is the price of land. And we already have talked about the fact that these prices are made artificially high through scarcity. But that's the situation we're in, is high price land. And so if you look at the land around the H1 highway on the ocean side, the water side, that's very high density development. A lot of that, excuse me, very high price land. A lot of that is still just zoned for residential development on 3,500, 5,000 and 7500 square foot lots. That area with those land prices needs to be opened up for more intensive development and redevelopment. On the other side of H1, that's also zoned the same way. That needs to be opened up for effective duplex. And I would add triplex development. Again, what we found was that while you can legally build a duplex, the amount of land that you need is 50% more. In some instances, 100% more than the others, which defeats the whole purpose. If you need more land to build the extra units, you're going to go with the monster houses and with the McMansions as they're called. That's what you're going to build because that's the highest and best use of that property. So what what Hawaii needs to do is allow other uses that take advantage of this high land costs, spread it over more density. In some cases, that could be high rise density as in Tokyo. In other cases, it could be what we call light touch density, which includes two units on a lot, lot splitting, things like accessory dwelling units, duplexes, triplexes, cottage homes, all kinds townhouses. These are all things that could be done. And as I said, we think that in the case of Oahu would add 26,000 units over a 10 year period, just re utilizing some of the existing land. Now, Ed, you've just written a paper on light touch density and you've listed some of the ideas in that paper. Anything that's particularly relevant to the Hawaii situation? Yes. What we've looked at a number of natural experiments, as we call them, one is Palisades Park, New Jersey, which happens to be where I grew up. And I was driving through there one day, and I happened to then go to Google, and I was Googling Palisades Park. And I noticed that the population had almost doubled from when I lived there in the late 60s. And wait a minute, it kind of looks the same. It doesn't have high rise development. What went on here? And it took me a while to figure out, it turns out that Palisades Park, from their initial zoning law, allowed duplexes on equal footing with single family detached homes. And so duplex homes and single family detached at equal footing. And while that's not the way Palisades Park developed initially, it was fully developed. But it eventually as the land prices went up, the owners and builders found that they could tear down the homes and build duplexes or two family houses. And that was a more effective use. That had all kinds of positive ripple effects. Not only did it rebuild much of the housing that was getting very old and was energy inefficient, etc. It also greatly added to the tax base of Palisades Park because you now had two units on the same lot that used to have one and also increase the value of the commercial properties that in their commercial district. Because now you had about 80% more customers within walking distance of those same areas. It was a walkable area. And so there were just lots and lots of benefits from this. In addition to being a walkable area, which is is healthy. And so we viewed those as lots of benefits and we can show how the town next door had a completely different result. We can also to show another town is much like Honolulu. On paper, the town says you can build a duplex pretty much anywhere in that town. In reality, very few get built why they require twice as much land as a single family home. Therefore, economically, not viable. There you go.  You referred to some of the developments in California recently that hopefully could translate into changes in Hawaii. California passed SB9 that allows a lot that traditionally was for one house to have multiple houses. In closing, how can we see these changes brought about in the political climate in Hawaii? What are some of the best approaches to convince our government? I think the best approach is to a build a coalition of those that would benefit from this. And I just went through in the Palisades Park case. There's a lot of different people that would benefit from this. You've got homeowners who now have something worth something. Their their land has a potential option to be used in another use and has value. You've got the impact on taxes, property taxes can be lower. You've got the impact on commercial development. You have the impact on builders and developers and subcontractors and all the other people that would be involved. And you have an impact on the workers that are service workers, of which Hawaii has one of the highest percentage of service workers in the country. They need places to live in ADUs. There's a lot of research out of California that shows how ADUs have relatively low rents compared to other similar sized departments. And you're adding in areas that are close to jobs. Those are other opportunities. So there's lots of opportunities to build a coalition among the willing and actually overcome the the nimbyism that you'd otherwise run into. And that's happening around the country. You mentioned California. It's happening in Oregon. It's happening in Minneapolis and many other places where they're embracing like touch density. Well, Ed, that's a great idea. And thanks for all the research you do, your insights. And we look forward to working more with you. Thank you for being on the program, Ed. My pleasure. Thank you. My guest today has been Edward Pinto of the American Enterprise Institute. I'm Keeley Akeena with the Grassroot Institute for Hawaii Together on Think Tech Hawaii's broadcast network. Until next time. Aloha.


Ladies and gentlemen welcome back to full metal alchemist brotherhood guys I'm excited to get started so today is the end of part two on Netflix It is reunion again You guys said that part the parts aren't that important It's just like how Netflix organized it but I imagine it's come to some sort of conclusion here Also, I was told that the beginning of part three I believe the next episode is like quote filler or like some kind of recap Let me know down in the comments if I should react to it or if I should just watch it like on my own Just like skip past it just let me know down below either way guys we're gonna hop right into it I'm excited to see what we follow because we have this face-off between Envy's true form against Ling and Ed And then of course Bradley up to no good using hot guys like his personal assistant now keeping her close that she can't do anything Now he has a grip on Mustang not really sure what's gonna happen. I'm excited to get started. So we're gonna hop into it All right It's just like 3d rendered in such a creepy way, too There's someone that's made out of his tongue too I Think dies that'd be so depressing. I wonder if they have to kill like all the heads They seem like Envy got mad whatever he's stabbed one of the heads at first. I only assumed that the main one mattered That's so gross It's just such an unnerving form Wait Why did he hear that voice? Are there like other There's like a monkey like stored in Envy if that was actually that girl's voice It's absorbing him and Ling's voice like desperation.  It looks like remorseful. It's weird. He wants to figure out what's going on He's just showing out the way To a father So this is the entrance just some random alley, I guess it's like kind of like hidden in plain sight Yeah, that must be confusing too because they were fighting basically to the death. I mean they know the HQ We know this is like the headquarters of everything right now is the fun I guess the father will be happy that he brought out because I was supposed to be a sacrifice Oh terrified, dude It's so scared I mean Al's desperate Honestly and the belly of the beast man I wouldn't be too surprised Other props I figured there'd be some That's who protects I was about to say they gotta have some kind of security so anybody Anybody wanders down there. They're done. So Yeah, probably if he created gluttony Especially if the father wants to get in the back to And Ed for the sacrifice. Is this the stomach? Oh It's the philosopher That's what's keeping in your life Is he realizing he did realize something and he would trade a way out probably How like use the philosopher stone in some way they're fighting the gatekeepers.  Oh Cameras much like the uh that poor girl Actually seeing her in combat haven't really I guess she disappeared for a little bit I tend to misuse like a homunculi and Camara like in ordinance with each other The energy yeah Dude, I hope we get to see like we've seen the father before like part of his face. I Still think it's it's their dad. Oh, and I Yeah, we've seen this room with all the gears. Yeah It's not ho and I but the beard looks so similar maybe it's like a twin brother. I don't know Lead this country dude Bradley's back story They called us perspective viewers. They trained us to be leaders Together and they taught us at all times of the day and night. We studied political science and humanities What happened to the other people and of course Georgetown ship or those his like confidence now And Bradley Oh my god, that's some intense training Don't worry. His only true purpose in life was to help you further achieve your goal I firmly believed it and I endured any training to make it. So good Lord Bring the next oh To be He was probably the only one that made it for the first one to make it just try not to think about it This won't take long. God I think I was a golden tooth will be like recurring you are the twelfth candidate All the father have what it takes to become my fury my wrath Loss of her stone is created from the life force of countless human beings Once in jeopardy changing into the sign begins to take over its new host My body was repeatedly destroyed from the inside out the only options I had would have died to overcome its power So from the beginning of his life, it was no jump or anything That's how long That's how long they've been in power like Barely I don't think he chose You could go back to being a child or not. You suggest I become a human again Why would I possibly want to pursue such revolting there reject all that power something far superior? Just as you mind said Humanity misguided though that may I too am proud because we also take pride at what we are I don't see Bradley ever killed changing his died with a pride intact. Did it she his ways there? That should help. All right. How are they gonna make it out? I collected all the Put them together. It's all from Xerxes pieces of a large mural from what remains of their temple I saw the ruins of the mural up close I thought it was identical to the transmutation circle from the fifth laboratory It's actually different sun represents the soul of the moon symbolizes the mind and then there's the stone canvas of the mural This represents the body slow down like the physical form is it used to bring back dead people can't Transmute a life form from a soul that no one of them have to be sacrificed if they want to be sent back Or could they use like some of in these transmute the dead But what would happen if I transmute myself you mean a living person? I guess cuz he's not even technically use this transmutations. He technically alive trucked myself And I'll just put myself back together. Oh my god I'll bet that if we pass through the real portal then we'll wind up in our own there has to be some loophole I'll open up the real portal and then you two jump through it. What happens if it goes wrong? It'll rebound a failed transmutation ricochet the one who performed it. He's willing to sacrifice himself I'm not gonna act like I know anything about alchem. This is all yours, right? That's not like Hey, I guess envy could be something else that I wanted to ask you the link couldn't the partial mural I saw in Xerxes. This is the first thing that caught my eye the symbol for God has written upside down Neath it is the two-headed dragon the alchemic symbol for a complete life form This basically translates to I will strike God to earth and become a perfect being well That's certainly an arrogant concept It's not a big deal to talk about it This piece takes it to the next level the lion swallowing the Sun symbolizing the philosopher stone.   It's not my country. Oh dude laying He's about to literally sacrifice himself if things go wrong. You've got people you love waiting for you Don't you? So just make it back alive and tell them yourself.  That's Ling spirit Alright Huh I never even thought about that that is a good like contrast Project yet At this point I would take any option. They're stuck in there good Trying to do reversal to the people of yeah Basically the sacrifice of them for this dude is bloody feel this It's beautiful There it is again His arm and leg Too fast He's gonna find out more where's the There's two now always two portals Wait, he was right. She's just eternally He's early locked away wait, that's Al That's Al's body. Oh My gosh It is growing It's actually growing like they said So but now he knows now he can tell Al your body still exists in this world And if they can get him to it he can retain it It's just sitting there waiting He wants to bring it back. Oh My god soundtrack with it I thought was their mom at first like that she was still actually locked away in this eternal purgatory It's the train makes more sense that was actually out because it was the same like Transmutation circle that they tried with their mom now if he can get back to Al if he's actually taken back Dude that would give them so much hope because now they know they're like now It's confirmed because previously they were fighting for something that that might exist now They know it exists now that they know it's obtainable and now I mean next episode is gonna consist of Al Meeting the father Ed getting back hopefully with Ling and Envy I don't know where Lenvy even Envy even fits in this anymore I just like a lot to take in and scars gonna hopefully get down there too eventually with this girl and too much to take in Hope you guys enjoyed today's episode. I love you all have a beautiful next couple days and I'll catch you next time