The Art of Spending Money with Bestselling Author Morgan Housel

Barry sits down with New York Times Bestselling author of The Psychology of Money, The Art of Spending Money, and Same As Ever. They discussed different sections of market cycles and the psychology of money. Morgan also discussed the role of innovation and financial growth in history.

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Episode Transcript

Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news. This is Masters in
Business with Barry Ritholts on Bloomberg Radio.

Speaker 2 (00:17):
On the latest Masters in Business podcast. My conversation with
Morgan Housel. I've known Morgan for I don't know fifteen years,
and I've loved all of his writing and his books.
The Psychology of Money is one of the best best
sellers in all of personal finance, coming up on ten
million copies sold. Amazing same as ever Timeless Stories about

(00:41):
Human Nature. The new book The Art of Spending Money,
Simple Choices for a Richer Life, drops today. I thought
this conversation is one of our best. Morgan is a
deeply thoughtful person. Everything he says comes from both experience
and academics. I love the way he puts stories together

(01:01):
with lessons. I thought the conversation was fascinating, and I
think you will also with no further ado, My conversation
with author Morgan Housel. Let's for people who may not
be familiar with you in your career, Let's give them
a little bit of background. You go to University of
Southern California, where you get a BA in economics. What

(01:23):
was the career plan?

Speaker 3 (01:25):
The plan all along was to be an investment banker
or a hedge fund manager.

Speaker 4 (01:28):
The reason why is.

Speaker 3 (01:29):
Every or very many young, ambitious, young twenty something males,
particularly in the mid two thousands, that was the thing
to do. If you go back to the early mid
two thousands, tech really wasn't that much of a thing yet.
Of course it was around, but it didn't have the money,
the prestige the growth that.

Speaker 2 (01:44):
Did, especially after the crash after.

Speaker 4 (01:46):
The Gosh, finance was the thing.

Speaker 3 (01:48):
If you were young and ambitious and wanted to make
a lot of money, you went to Wall Street, you
worked at Goldman Sachs or investment banker. That's what I
wanted to do, Plan A, B and C didn't want
anything to do. I got an investment banking internship in
what would have been I guess junior year, and it
was like, this is it, this is the dream. Here
we go, this is awesome. Within ten minutes of the
first day, I knew it was not for me.

Speaker 4 (02:07):
Ten minutes.

Speaker 3 (02:08):
It took ten minutes for me to be like, Nope, nope,
that's not going to work. I'm I can do good work,
but not under the hazing style pressure that was so
prevalent in banks back then. And it's not that I
didn't have the work ethic for it. It was just
it seemed like such a broken culture that I wanted
nothing to do.

Speaker 2 (02:27):
It's so funny you said that I had the same
experience as a first year associate and a summer associate
in a law firm, and I'm like, oh, this is
a horrible lifestyle. You're in your twenties. Why do I
want to be spending every weekend in the law library.
It was miserable.

Speaker 4 (02:42):
Yeah.

Speaker 3 (02:42):
They had a quote on the first day of my
investment banking internship and they said, the rule here is
if you don't come to work on Saturday, don't bother
coming back on Sunday.

Speaker 4 (02:50):
And I went, nope, no, what about Monday. That's not
for me. That's great.

Speaker 2 (02:53):
So I don't have to work weekends. Fantastic, see it right?

Speaker 3 (02:56):
So then, so I didn't know what to do, and
I was really a drift and lost. And then I
graduated in two thousand and eight financial crisis. World is
in flames, nobody is hiring, and I stumbled haphazardly, not
by any plan or strategy. Out of desperation, I took
a job as a finance writer at the Molly Fool.

Speaker 2 (03:13):
So were you an analyst or a finance writer?

Speaker 4 (03:15):
A writer from day one? I was still in college
at the time, Uh huh.

Speaker 3 (03:18):
And I started covering banking stocks at the Motley Fool
in two thousand and seven time, and I've been a
writer ever since.

Speaker 2 (03:26):
So I'm curious talking about being a hedge fund manager
or an investment banker. I know your early life you
were both a ski bomb and a car valet. Yeah,
parking really expensive cars. Did that have any influence on
your initial erroneous career choice?

Speaker 4 (03:43):
It had so much influence.

Speaker 3 (03:45):
But really, I grew up in a middle class family,
great town and not a wealthy town, not poor, not
out in the sticks, but a decidedly middle class town
in California's just outside of Lake Tahoe, California. Also before
tech money infiltrated Lake Talk, So back then it was
truly just a small little mountaintown.

Speaker 4 (04:02):
It's not anymore because tech money came up.

Speaker 3 (04:05):
And so I didn't have much concept of wealth because
in the town that I grew up in, regular people
had old pickup trucks and rich people had new pickup trucks.
That was the stratification of wealth. That was as far
as it got. And so but anyway, I started working
at this these fancy hotels and all of a sudden,
people were starting to come in in these cars that
just blew my mind. Not just BMW's and Mercedes, but Ferraris,

(04:28):
Lamborghinis once in a while. And then I went to
college in Los Angeles, stayed working as a valet at
even nicer hotels in LA and then it was Rolls,
Royce's and Aston Martins, and it was just a level
of wealth.

Speaker 4 (04:39):
That I didn't know existed.

Speaker 3 (04:41):
And in my young, you know, nineteen twenty year old mind,
it was just so appealing to me. I was just
overwhelmed with, like, whatever that is, I want it. I
want some of that immediately. But it was also I
think I not on purpose, but I think I just
kind of started picking up the little subtle clues of
the psychology of rich people. The first thing that was

(05:02):
I was very apparent was that a lot of them
were not that happy. A lot of them were just
kind of old, bitter, broken men arguing with their wives,
always kind of stressed, third wives right right away, always stressed,
always barking on the phone, and it was, and it
was all the time. It was all the time, And
I remember picking up on that and being like, Hey,

(05:23):
on one hand, I really want that. On the other hand, like,
is that supposed to be my role model? Because it
doesn't look that great. And I know a lot of
middle class people from the town I grew up and
who seemed a hell of a lot happier than that guy.
And so I think that was I started picking up
on kind of the psychology of wealth, not intentionally, but
it was a very good window into that aspect of
wealth because in my little, p size nineteen year old brain,

(05:47):
it was in my what I assumed was you have
so much money, you must just be a walking ball
of happiness. That was that was the intuition that I had,
But it was so clearly not that.

Speaker 2 (05:57):
So think about that for a second. And I have
so much stuff from your new book to that's relevant
to this, but we'll get to that later. Think about
when you're young and relatively broke. And I grew up
lower middle class and put myself through college and grad
school and always felt like, Gee, if only I didn't
have to worry about money, how much greater my life

(06:20):
would be. But chasing away the lack of money blues.
That's just a modest decrease in stress, not the secret
to happiness.

Speaker 3 (06:30):
I think of what is tends to be true, and
there's no hearted fast rules here. This is not black
and white, but it tends to be true that wealthier
people might have fewer bad days than poor people. I
don't know if they necessarily have more good days. That's
a great now, that is a lifestyle improvement. To have
fewer bad days, to not have to worry and stress
about making rent and healthcare and whatnot to remove. That

(06:52):
is a lifestyle improvement, but it is not happiness. It
is different in the same way that you and I
are fortunate enough to wake up every morning not worrying
about catching polio, right, that's a lifestyle improve.

Speaker 2 (07:04):
Or what you can eat that dell or exactly will
you eat that? Right?

Speaker 3 (07:09):
And relative to the standards of one hundred years ago,
that is an unbelievable lifestyle improvement. But it's not happiness
because you and I didn't wake up this morning thinking
about it.

Speaker 2 (07:16):
That is simply Maslow's hierarchy of basic needs. That's different
than happiness than contentment, which we'll talk about so let's
stay with your writing at the Motley Fool. One of
the things two of the things that really distinguish your writing. First,
you're a great storyteller and you find some fascinating stories.

(07:39):
But second, you figured out early that finance is not
so much about math as it is about behavior. Now
tell us how you stumbled into an interest in behavioral finance.

Speaker 3 (07:52):
So much of this was moley Ful is a stock
picking organization, and I'm not I don't look down upon
stock picking, but it's not what I do. It's not
how I invest, it's not what interests me at all.
And so I kind of had to find a little
niche for myself. At the Mali Fool, they were completely
and they were completely supportive of my you know, kind
of black sheepedness being there being like, hey, you know

(08:14):
everyone else is picking stocks and I'm just trying to
do something else over here. You're counterprogramming, right, And so
I had to figure out what to do. For a while,
it was macro. This was post financial crisis, and I
was like, I'm going to study the forces of the economy,
and that not intentionally but kind of just pushed into
behavior in psychology, I think a lot of that was
as I was studying macro, this realization and you've been

(08:36):
a big part of this as well, of realizing that
there is nothing in a macro textbook that will explain
two thousand and eight, and so as a writer, as
I was trying to explain what just happened and the
aftermath of the GFC was there's nothing in there that
explained why people did what they did. Nothing in an
economics textbook or the academic framework that would explain the

(08:56):
housing bubble that preceded it, the behavior during the crash,
the pessimism after it, Like, not much there, but if
you looked at it through the lens of psychology or sociology,
or political science or evolution, all these other fields like
had a lot to say and could explain why people
were doing the things they do.

Speaker 2 (09:13):
So that was just the subtle.

Speaker 3 (09:15):
Coming to terms with the idea that money and finance
is not the study. It's not the study of finance,
it's a study of how people behave with money.

Speaker 2 (09:22):
So I'm pulling forward a quote from later in our
conversation that's dead on with that insight. Risk has two stages.
First one it actually hits. Then when the scars influence
our subsequent decisions. Now, so you graduate into the eight
to nine disaster, everybody post financial crisis, and I shouldn't

(09:47):
say everybody, but so many people post financial crisis was Hey,
that was just the first leg after March or nine, Wait,
wait for the second leg.

Speaker 3 (09:56):
Nerrophrase double dip recession. That's where everybody said it for
eighteens a day. It was decades before. If you go
back to twenty ten, particularly twenty eleven, everybody in the
financial media said the phrase double dip recession every hour.
It was inevitable. It was absolutely inevitable. The other version
of this is at the end of World War Two
nineteen forty five, it was a foregone conclusion that nobody

(10:19):
disagreed with that the US economy would fall right back
into the Great Depression, that in the absence of military spending,
it was not just going to contract and revert to
the mean, it was going to go back to the
nineteen thirty two lows of desperation. And in hindsight it
didn't happen, but it was a foregone conclusion back then.
It is always the case that the simple narrative, and
oftentimes the simple narrative is just extrapolating whatever just happened

(10:41):
is going to be the most appealing, the most logical,
It makes the most sense in the cyclical nature of economies. Though,
like we all know in hindsight, what happened during those
piers that actually the end of World War Two. There
were some mild recessions in the late forties and fifties,
but by and large that was actually the beginning of
an epic boom in the fifties and sixties, and after

(11:02):
the GFC, you know, twenty nine twenty ten, that was
in the stock market and economically the beginning of a boom.

Speaker 4 (11:08):
And it's almost.

Speaker 3 (11:09):
Impossible to realize that in real time, as it was
almost impossible to realize in ninety nine two thousand that
of course in tech stocks, but also in the broader
economy that was about as good as it gets. And
when it's just about as good as it gets, that
was it was so easy to extrapolate from there, but
that was actually the end of the good days.

Speaker 2 (11:26):
You know. The shocking thing about the post financial crisis period,
and I'll take a little credit for flowing this phrase
out there, it was the most hated bull market in
history by like October nine, people were talking about wait
for the next thirty forty percent dip, and you mentioned hindsight.
Our hindsight bias keeps us looking backwards and ignoring the

(11:49):
fact that, hey, when is a down fifty percent market
in the US not a great entry point, all right,
nineteen twenty nine, But that is the exception to rule
every other time it's been down cut in half.

Speaker 3 (12:02):
I'm a buyer, right, And actually, if you go back
to you know, nineteen thirty one thirty two, when the
market was down fifty percent, it eventually fell eighty nine percent,
So if it was down fifty percent, you still lost
a fortune after that, that's right. But if you made
those purchases down to hel percent ten years later, you
were doing an absolutely incredible Now that was that's cold
comfort for the other fifty percent that you continued to
lose by nineteen thirty two. But there's all these cases

(12:24):
where people say they're long term investors, and they want
to be long term investors, but then, particularly when they're
trying to buy the dip, if the market falls for
another ninety days after that, they feel like they've made
a colossal error.

Speaker 2 (12:36):
So I find there's a huge difference. Many people are
intellectually long term investors, but emotionally they're not, and that
tension is what drives a lot of that.

Speaker 4 (12:47):
See, I would put a different spin on that.

Speaker 3 (12:49):
I would say a lot of people, you know, claim
to be kind of short term investors in the sense
that on Twitter they're like, oh, this is this is
the peak, this is the top. The I mean in
Q four is not looking They say things like that,
But if you actually looked how they invest like and
therefore they dollar cost average into their four to one
ks and never sell anything.

Speaker 2 (13:07):
And that's the right approach market crash. In fact, you
never pick a point as the bottom, even if you
put a big chunk of your free capital. You should
always be hey, I don't know where the bottom is.
I'll try a little in nineteen thirty and a little
more throughout thirty one and thirty two. Eventually your average

(13:27):
is going to be far lower with than where the
market is. But you have to have a steady source
of capital and some income.

Speaker 3 (13:33):
Now, I remember in twenty eleven when there was the
double Depp recession and the market did fall I don't
know twenty or thirty percent. That was probably more pessimistic
in twenty eleven than people were in two thousand and nine.

Speaker 4 (13:43):
Twenty eleven, people were.

Speaker 2 (13:44):
Like, this is it, this is over going back down
to the.

Speaker 3 (13:46):
Market was plunging, and the narrative was everyone's panicking, everyone's selling.
Vanguard put out a study that showed during that era,
ninety nine percent of their clients did nothing, didn't sell,
what didn't do any didn't do anything. And so the
narrative of everyone's panic, everyone's selling is usually so completely
different from what people are actually doing.

Speaker 2 (14:06):
So let me share one of my favorite quotes of yours,
since you're talking about highs and lows. Every market valuation
is a number from today multiplied by a story about tomorrow.
I think that's genius. I love that quote.

Speaker 4 (14:21):
Thank you.

Speaker 3 (14:21):
You know it's always a number from today, like earnings
per share, multiplied by a story about tomorrow, like a
valuation multiple. And what's important is, particularly in a low
interest rate environment and particularly in a ZERP environment, those
stories are everything. The number from today almost doesn't matter.
The stories are everything. That's always been the case. But
in a social media world, the stories get bonkers. The

(14:43):
stories get absolutely nuts.

Speaker 2 (14:45):
Narratives become memes.

Speaker 4 (14:46):
Yeah, you know, Ben.

Speaker 3 (14:47):
Graham had the quote in the stock market is a
voting machine or nol miamis knees voting machine in the
short term and a weighing machine in the long run.
But he said that one hundred years ago, and it's
still true. But they're because of how the world works today,
stocks can remain voted on, not necessarily weighed. For probably decades,
Tesla has been a voted upon stock, not a weight

(15:09):
upon stock, for its entire existence, and maybe that will
change someday. But I think in previous eras in the
Ben Gram era, or even not even you know, twenty
or thirty years ago, you could have brief, momentary flashes
of insanity. And that was probably the late nineties you had,
you know, eighteen months of just pure insanity where everything

(15:29):
was narrative driven, it wasn't really earnings driven. And now
you can have that going on for very long periods
of time. I mean, how long has has Hurts and
game stock been been meme stocks?

Speaker 2 (15:42):
Like years, five, five years? Is still I think it's
still a thing, still a reddit, It's still a thing.

Speaker 3 (15:46):
It's still still a thing, maybe not to the extent
that it was, but these stocks did not revert all
the way back. They still have this cult meme following,
and so the point being, it's always a number from
today multiplied by a story about tomorrow. Because the world
we live in interest rates and social media, the stories
get insane.

Speaker 2 (16:03):
So let me mix your Canes quote with your own quote.
In the short run, markets or probability machines. In the
long run their narrative machines. That that's a good blend
of view, and Canes there are worse people to marry.
All right, One or two more questions in this segment

(16:24):
before we move on. I'm you address one of my
favorite pet peeves about uncertainty in a sentence that I love. Quote.
There's rarely more or less economic uncertainty, just changes in
how ignorant people are to potential risks. That sums it
up perfectly. I hate the uncertainty meme because by definition,

(16:48):
the future is always inherently uncertain.

Speaker 3 (16:50):
Yeah, I mean, there have been some academics who have
tried to make uncertainty indexes. Where they make it in
the end, you can put it on a chart to
measure the amount of uncertainty, and there's various ways that
they do. In terms of like newspaper narratives and changes
in economic policy, and to map out uncertainty. And what's
so fascinating to me is if you look at these indexes,
which I think are pretty rationally put together, it shows

(17:11):
that uncertainty is the lowest, as in certainty was the
highest at two periods in modern times.

Speaker 2 (17:17):
I guess three periods.

Speaker 3 (17:18):
One is right before nine to eleven, the other is
right before the GFC, and the other is right before COVID.
That was when purportedly we understood the future in the
greatest degree.

Speaker 2 (17:28):
And if you go to Sack time completely insane, I'm
going to tell you there was a lot of certainty
in late ninety nine. Yeah, stocks grow to the sky,
and you go back to March on nine, there was
certainty that stocks was going to zero.

Speaker 3 (17:39):
And so what we know in hindsight is that those
three periods just before nine to eleven, just before two
thousand and eight, and just before COVID were the most
uncertain That was when your view of the future was
completely and utterly wrong, no matter who you were or
how smart you were. And so I think it's true
that there is never more or less uncertainty. It's just
we go through periods where we are more ignorant and

(18:00):
more confident in our ability to forecast than others.

Speaker 2 (18:03):
Let's talk about luck. I just wrote something about this
and found a quote of yours afterwards that I would
have loved to use. Most people when they talk about luck,
increasing the surface area of your luck. Luck is where
preparation meets opportunity. Your definition of luck recognizes that it's
something fundamentally outside of your controls quote you can't believe

(18:27):
in risk without also believing in luck because they're fundamentally
the same thing, and acknowledgment that so much is outside
of your control.

Speaker 3 (18:35):
Yeah, when people say like, oh, the harder I work,
the luckier I get, you know, those kind of they
seem like like benign quotes. I'm like, no, that's not
what luck is. If you can go out of your
way to increase it, it is not luck. It's hard work.
It's hard work, it's skill, it's a value. I commend
you for it, but it's not luck. Luck is you
were born in this era. Luck is your parents told
you X, Y and z. Luck is you haphazardly met

(18:57):
this person. You did not do anything intentionally to it.
It was completely outside of your control, the biggest of
which is where and when you were born that have
an unbelievable impact on this. Bill Groat's a great bond Mananagru.
I'm sure he's been on the show before. He spoke
about this one time that he was a bond manager
from the early you know, the bulk of his career

(19:17):
was during the largest decline in interest rates that's ever occurred.

Speaker 4 (19:21):
And he wondered himself in this piece of a rope many.

Speaker 3 (19:24):
Years ago, like, would he have had the success he
did if he was born ten years earlier or ten
years later. Would Buffett have had the same success if
he was born ten years earlier or ten years later.
I would, I would venture to say the answer is no.
There are both of those people, very hard working, very intelligent,
able to capture opportunity.

Speaker 2 (19:39):
Yes.

Speaker 3 (19:40):
Were they also unbelievably lucky in something they had no
control over, which is when they were born.

Speaker 2 (19:45):
Yes, as well. I'm trying to remember the book that
mentioned it's not a coincidence that so many of the
best known entrepreneurs of our era were born post War
World War two, mid fifties, Steve Jobs, Bill Gates. It
goes through a whole list, and and just being born
into that vacuum when there was massive societal change, economic change,

(20:06):
technological change. That's what created the option of starting a
whole new company in a brand new space.

Speaker 3 (20:13):
Yeah, and if Steve Jobs was born twenty years later,
he still would have been extremely successful.

Speaker 4 (20:17):
He's just built different.

Speaker 3 (20:18):
Of course, but to the degree that he was almost
certainly not so I think rather than luck, because people
don't like that phrase. It makes you sound jealous and
bitter of other people. I think the phrase to use
is what is repeatable? What have you done in the
past that you can do again? And if if you
know what in your life, in your in your world,
if you started over tomorrow with no money, no name, recognition,

(20:42):
no context, could you repeat what you've done? And sometimes
the answer is yes, So that's not luck.

Speaker 2 (20:46):
I'm going to say no. For me personally, I guess
it's right time. Yes and got I literally just finished
a chapter for someone else's book on how random so
much of the world is. And I have to tell you,
the first couple of times a billionaire tells you how
important luck was, you kind of shrug it off, as Hey,

(21:08):
these guys are a little false humility. The person who
disabused me of that notion was Howard Marx, because he said,
you have to be smart, you have to be hardworking,
but you also have to get lucky. And I'm like,
come on, Howard, why do you say that. You know,
look at what you've done since you graduated Columbia Business School.
And his answer was, everybody I went to school with

(21:31):
was super smart. They were all incredibly hard working. Not
all of them became wildly successful. And you have to
just acknowledge how much of this is just serendipity. And
when a guy like that, who has no false humility,
when he says, no, I could give you ten instances
where my life changed because of dun luck, you kind

(21:51):
of have to acknowledge that, right, was ja Paul Getty said.

Speaker 3 (21:54):
He said the three successes, the three rules for getting
rich are go to work early, stay late.

Speaker 2 (22:00):
Oil fantastic. Coming up, we continue our conversation with Morgan Housel,
author of the best selling book Psychology of Money, discussing
how he writes books, essays and columns. I'm Barry Results.
You're listening to Masters in Business on Bloomberg Radio. I'm

(22:34):
Barry Redults. You're listening to Masters in Business on Bloomberg Radio.
My extra special guest is Morgan Housel. He is the
best selling author of Psychology of Money as well as
Same as Ever his latest book, The Art of Spending Money,
Simple Choices for a Richer Life. Before we get to
the book specifically, I want to talk a little bit

(22:55):
about your writing process, and you know you're Some of
my favorite essays of yours take historical stories, world wars,
business failures, unlikely successes, and I specifically recalled Kitty Hawk's
story and the solo sale competition around the world, and

(23:16):
you connect them to timeless lessons on behavior and money.
Tell us a little bit about your research process. How
do you find these amazing and crazy stories.

Speaker 3 (23:27):
I think it started with a survival technique as a writer,
because as a finance writer, if I got up every
day and wrote, here's what the Dow did today, you're
out the people who can do that faster than you.
You're not really adding much value if you do that.
And so as a writer it was like, hey, if
I need to get people's attention, I need to make
it interesting. So and one of the ways to do
that because myself, as a reader, what I enjoyed when

(23:49):
other people did is when they tied the rest of
the broader world into finance. Here's a story that has
nothing to do with money. It's a story about evolution
or World War two, whatever it might be, and let's
take the lesson from that entire I loved when people
did that.

Speaker 4 (24:01):
I loved it, loved it, loved it, and wanted to
do it myself.

Speaker 3 (24:04):
The second part is I think I got you closer
to the truth that when you study those fields, whatever
it might be politics or military history, you're studying behavior
and it's the same behaviors that impact investors in the
same way. And so a lot of even finance professionals
get into trouble when they view and study finance through
the very narrow lens of finance without realizing that it's

(24:24):
a very broad field of how people behave.

Speaker 2 (24:27):
So that was the first of it.

Speaker 3 (24:28):
The second is when you start looking for it, when
you have the little seed in your head that when
you're reading about a broad array of fields, if you
have a little bird in your head that says, how
does this tie back? Like what is the behavior and
how can tie it back to money? You see it
everywhere you can't stop seeing it, and you realize, like
how interconnected our behavior is, because the same way that
you and I think about risk and investing also impacts

(24:50):
a lot of things that we think in life. Our friendships,
our relationships, our health tie back to the same framework
of how we think about risk and money. It's very
tied together. The whole world is kind of woven together
in those and so you start seeing these same themes
over and over and over again about how compounding works,
how risk works, how envy works.

Speaker 4 (25:09):
It's the same.

Speaker 3 (25:09):
And I also think if you see a behavior repeat
in several different fields, you found something that is like
infinitely important and then you can be like, oh, that's
a good one.

Speaker 4 (25:18):
I need to talk more about that.

Speaker 2 (25:19):
In finance, how often when you're doing research you have
that WTF moment that's like, oh my god, how can
this possibly be true? And you research it and it's like, Wow,
not only is this true, but it applies to so
many other things. Is that a monthly occurrence a weekly occurrence?
How often does that happen?

Speaker 3 (25:36):
I think it's very often that you find behaviors that
also have a ven diagram overlap with with money. That's
pretty often in terms of them being like a slam
dunk of like, oh, that is just a phenomenal interesting story,
and it is so identical to what happens in investing.

Speaker 4 (25:51):
That's probably a once a.

Speaker 2 (25:52):
Year kind of thing.

Speaker 4 (25:53):
Oh really, I think. So that's a lot of slam
dunk in psychology.

Speaker 2 (25:57):
And money, you have a bunch of those. And same
as ever, you have a run of those. There's a
lot of that in this you're less than fifty years old.
You have more than fifty of these stories.

Speaker 4 (26:06):
Some better than others, though. There's a couple.

Speaker 3 (26:08):
There's a couple that I've come across over the years
where I remember just sitting back in my chair and
being like.

Speaker 2 (26:13):
That's that's just a jackpot.

Speaker 3 (26:14):
That story is just could not be better seeing it,
and you find it in these areas that have nothing
to do with money.

Speaker 4 (26:21):
I remember it.

Speaker 3 (26:21):
So you mentioned in the artist spending money the story
about the sailors, Yes, has absolutely nothing to do with
money whatsoever.

Speaker 2 (26:26):
And I remember reading everything to do with ego and behavior.

Speaker 3 (26:29):
And behavior, But I remember reading an old New York
Times article is from not that old, maybe two thousand
and seven, and it had one line it said there
was a sailing race back in the nineteen sixties, and
one of the sailors was about to win, but decided
he liked sailing, so he quit the race and just
kept sailing.

Speaker 2 (26:44):
And I didn't want the publicity and all the nonsense
around the opposite of ego.

Speaker 3 (26:48):
And I remember reading that like that's interesting, Like can
we pull on that thread a little bit more?

Speaker 4 (26:52):
And you start doing.

Speaker 3 (26:52):
Research and you're like, oh, this is this is ego
or the lack of it, And of course that applies
to money in what I thought was just a slam
dunk way, Like that's a rare story.

Speaker 2 (27:02):
Fine, you know, pull on that thread. People don't understand
the original quote from the professor who said it was
the plural of anecdote is data. And what was meant
by that is you start pulling on the thread of
these one offs and you find these broader things applical
to other things. You shouldn't just dismiss the one off
because it's anecdotally really kind of fascinating. So the other

(27:26):
one that has always stayed with me involved Kitty Hawk.
How long was it before the first Right Brothers faster
heavier than air flight made it into the New York times.

Speaker 3 (27:39):
It took them about four years to build the airplane,
and then after they flew it in Kitty Hawk, it
took them about another four years before virtually anybody was
paying attention. And there were years after the right brother's
first flight.

Speaker 4 (27:50):
We all seen the.

Speaker 3 (27:51):
Picture, one of the most famous pictures of all time. Now,
it was literally years after that took place that The
New York Times was writing things along the lines of
humans will never fly, it will never happen.

Speaker 2 (28:00):
It's already happened. Then they're staying the wrong thing.

Speaker 3 (28:02):
And there was even periods back in Dayton, Ohio, where
they were from. After Kitty Hawk, they went back to Dayton,
and Dayton is where they truly mastered flying. They figured
out the two hardest parts, which were turning and landing
and h and Danon was a big city in the
early nineteen hundreds, and they're flying like over people's backyards
and there's virtually nothing written about it. There was in
one of their biographies it basically says that people in

(28:23):
Dayton that saw them flying assumed it must have been
some sort of magic trick, asking like where's the rope.

Speaker 4 (28:29):
Kind of kind of thing, like.

Speaker 2 (28:30):
The rope attached to exactly exactly well, it's it's you know,
it's all turtles all the way down.

Speaker 3 (28:36):
But it was the analogy that was given in their
biography by David mccallough was if you and I saw
a demonstration of time travel today, we would be like, okay,
but it's just an illusion, like you didn't actually do that,
Like I saw what you did, but that's but there's
there's a trick here. And that's how they viewed flying
at the time. And it really took almost about half
a decade before people were like, oh, this is this

(28:58):
is the thing, this is this is big. And I
think that's true for a lot of new technology that
the gap between discovering it and it becoming a world
changing thing can be years of not decades. It's almost
never that it happens overnight that we come up with
a new technology and people are like, that's it.

Speaker 4 (29:14):
That's the thing.

Speaker 3 (29:15):
People talk about how quickly chat GBT was brought into
the fold. You know, within a year of it coming out,
there were hundreds of millions of users. But AI has
been a thing for.

Speaker 2 (29:23):
Thirty years, forty years.

Speaker 3 (29:25):
So the idea that like, oh, we recognized it immediately,
like no, it took a lifetime to get there.

Speaker 2 (29:29):
You know. I saw I saw a Reddit map and
I thought of you. It showed here's how far you
could travel one hundred years ago from London, and it
was a map of this is a day, this is
a week, this is a month, and then modern times
you could get anywhere on Earth today within thirty six hours. Now,
the polls whatever, but back then you couldn't even get

(29:53):
to America in a month from London. It was It's
just insane how that changed. And that's what made me
think of Kitty Hawk. There's another quote of yours I
love that's related to all of your books, which is
getting rich and staying rich are different things that require
different skills.

Speaker 3 (30:12):
To explain that well, we all know the stories of
the hedgeplom manager who was very good at getting rich
and had no ability to stay rich whatsoever.

Speaker 2 (30:21):
There's a lot of stories about that. Art you ghosts
very recently, very many billions.

Speaker 3 (30:25):
To zero and the more famous, more famous examples long
term capital management or Jesse Livermore. I mean, going down
the list of people who are unbelievably skilled at getting
rich and completely brainless at staying rich, they're two very
different skills. And when you see either a person or
a company that has both equal skills of getting rich
and staying which, it's a rare thing, and some companies

(30:46):
have this. Microsoft has had that Apple. You know, no,
I would take that. I'd take Apple back if there
Microsoft since ninety nine. They went through a very rough
period before that. Microsoft is probably the quintessential example of
a country that a company that is or unbelievable, unbelievable
getting rich and has an equal ability at staying rich
in terms of how it manages its balance sheet and
staying relevant whatnot. It's a very rare skill, and it's

(31:07):
often a contradictory skill, because to get rich you need
optimism and risk taking, and to stay rich you need
almost the exact opposite. You need a level of paranoia
and conservatism to keep you around. You need that jeckal
and Hyde personality to do well over long periods.

Speaker 2 (31:22):
And so the interesting thing about the examples we both
gave arch ghosts and long term capital management. They got
rich through an excessive use of leverage. But in your
book you talk about the Vanderbilts now, which is kind
of fascinating. They got wealthy through just wild business success,
oil and railroads, and go down the list. And yet

(31:45):
once they had that money, all they could do is
spend it at a profligate rate, derived seemingly no joy
out of the process. And it took three or four
generations and they were the money was all gone pretty much.

Speaker 4 (31:58):
You know.

Speaker 3 (31:58):
Of all the robber baron families here in New York
who managed the money, the Carnegie and the Rockefellers did
very well at using their huge wealth to better society
and to make their errors, to give them good lives,
and to keep it around for several generations. The Vanderbilts
did by far the worst, by far and away the worst.

(32:20):
So when Cornelius Vanderbilt died a justed for inflation, he
had about three or four hundred billion dollars, just an
unbelievable fortune. As you mentioned, within about three generations there
was virtually nothing left. And in between those three generations
were a series of errors who, by and large, with
few exceptions, were miserable. Were miserable, miserable people, and the
reason why was very clear when you study their biographies.

(32:43):
The money completely controlled their personality. It told them who
they could be, It told them where they could live,
It told them the lifestyle they had to live. It
told them who they could marry, It told them who
they could be friends with. It had complete and outer
control about it. They had all of the financial independence
that one in history could ever imagine, and they had
no intellectual independence, They had no lifestyle independence had They

(33:06):
were completely dictated.

Speaker 4 (33:07):
By the money.

Speaker 3 (33:08):
And it wasn't until the money was more or less
exhausted that the first Vanderbilt heirs who didn't get anything
could build a life of their own.

Speaker 4 (33:16):
And this is now very well known.

Speaker 3 (33:17):
The first Vanderbilt air who virtually didn't get anything is
Anderson Cooper. His mom was Gloria Vanderbilt.

Speaker 2 (33:24):
A designer who famously built her own fashion shot.

Speaker 4 (33:27):
And that was effectively where the big trust funds ended.

Speaker 3 (33:29):
And Cooper has talked about this that you know, he
was one of the first people in his family in
one hundred and fifty years who could was like blessed
with the ability to build his own life where the
money didn't control it and dictated. And it's an amazing
thing to watch.

Speaker 2 (33:42):
Are you the master of your wealth or are you
a slave to money? That's it really is the key question.
You know, you talked about the Rockefellers and versus the Vanderbilts.
I had the CIO of General atlantic On and General Atlannik.
Is the money that comes from the Duty Free shops,

(34:02):
which has blown up to be a spectacular fortune. The
founder you discuss in the book spent most of his
life giving away all his money and he couldn't be happier.
Tell us about him.

Speaker 3 (34:14):
So the founder's a guy named Chuck Feeney, passed away
couple of years ago. Unbelievable story that he has started
Duty Free store made for him personal fortune about ten
billion dollars thirty years ago.

Speaker 4 (34:25):
Yes, a lot of money.

Speaker 3 (34:26):
The well known part of Chuck Feeney's story that's been
well documented is that he gave ninety nine point nine
to nine percent of it away.

Speaker 2 (34:32):
I think during his life, during his life and his will,
I think he ended it out regularly.

Speaker 3 (34:36):
I think the statistic was he took out two million
dollars with an m to live off of lived in
a small apartment flu coach, lived like a complete and
utter ordinary person, and gave ten billion dollars away.

Speaker 4 (34:47):
That's the well known part of it.

Speaker 3 (34:49):
The less well known part of his story that I
think is actually more important is that if you go
back to the eighties when he first made his fortune,
he lived like a billionaire. He had mansions and yachts
in a private in private jet, lived like the quintessential
billionaire would, and hated it ostensibly was not for him.
He has a quote that I love. He said, I
realized that I was happy when I was giving money away,

(35:10):
and I was not happy when I was not giving
money away. And so he chose, he rejected that and
chose to live this very frugal life that he had.
And what I love about that is not that he
lived frugally like you know there, you know he was.

Speaker 2 (35:23):
He was.

Speaker 3 (35:23):
He was kind of obsessive about it in a way
that I would not do it. I don't think he.

Speaker 2 (35:26):
Will, like in front of the bus, you don't have
to sit in the back exactly giving away ten billion dollars. Sure,
But what I love about it is that he chose it.

Speaker 3 (35:32):
He did not. He did not give any any care
in the world how society told him to live. The
money did not dictate his personality. He did it for himself.
He was He was a truly independent thinker. Could not
be more polar opposite than the Vanderbilts, who were absolutely
beholdened to what money in society told them that they
should be unbelievable.

Speaker 2 (35:52):
Another one of my favorite quotes of yours. A big
takeaway from economic history is that the past wasn't as
good as you remember, the present isn't as bad as
you think, and the future will be better than you anticipate.
That's a fantastic quote because it's so true. We're stuck
here in the moment. History is roasty nostalgia, the future

(36:14):
is wishful thinking. Tell us how you put this quote together.
How'd you come together with this?

Speaker 3 (36:19):
I think a lot about nostalgia. I'm a very nostalgic person,
so I think about it a lot in my own life.
And it tends to be true that we massively overestimate
how good the past was because we know how the
story ends. Yes, and so when we look back at
the nineteen nineties, we say, what an amazing period of
time because we know how everything played out. It all
worked out, but in the nineteen nineties we didn't know that.

(36:39):
We can wax about how great the nineteen fifties were.
Middle class America, prosperity mom and pop, white picket fences
got kind of thing.

Speaker 4 (36:47):
They didn't know it back then.

Speaker 3 (36:48):
What a lot of them were thinking about back then
was nuclear holocaust and the recession that see was seemingly
right around the corner. And so when you know how
the story ends, it makes it almost impossible to put
yourself in the shoes the past, including your own shoes
of the past, very difficult to do. So I think
we just habitually overestimate how good the past was. We
overestimate how bad the present is because we are just

(37:10):
completely bombarded with negative headlines about what's going on today.
If it bleeds, it leads right, and then extension of
that is you extrapolate today into the indefinite future, and
so we underestimate how good the future can be.

Speaker 2 (37:22):
Really fascinating quote. Last writing process question, you discuss the
reverse obituary exercise and how can help people clarify their priorities.
Explain what a reverse obituary is.

Speaker 3 (37:39):
It's this idea that it's kind of a grim exercise,
but I think it's very useful. Write down what you
want your obituary to say, what would be your dream
obituary to say? And everyone would be different, but for
me in that exercise, I would immediately go towards Morgan
was a good father, he was a good husband, he
was a good citizen. He helped his town, he helped

(37:59):
his friends. That's what I would want it to say,
and I think most people would be like close to that.

Speaker 2 (38:04):
Not Morgan's bought a really cool red Ferrari.

Speaker 3 (38:07):
You automatically know what is not in there, which is
your salary, the square footage of your house, the horsepower
of your car. It would be be completely absurd to
put that, and you would automatically say, what an absolutely
hollow life it is.

Speaker 2 (38:19):
If that's what I.

Speaker 3 (38:19):
Could put in my obituary was how much money I made,
how much money I saved? What a completely useless life?
And so I think automatically it pushes people to realizing
what they actually want out of life, what they actually
aspire to. And I think the gap between what you
are aspiring to today versus what you know intuitively you
want your obituary to say, which you want to accomplish

(38:40):
over the long term, can be huge. Maybe not for everybody,
maybybe there's some people that truly are living the life
of their reverse obituary. But I think it's a good
exercise to really clarify what you want out of life.

Speaker 2 (38:52):
I lie, that wasn't the last question. I have so
many You're leading me down so many paths, starting with
nothing's worse than getting what you want but not what
you need.

Speaker 3 (39:02):
And there's a lot of that, because if you are
fortunate enough to have a lot of money, earn a
lot of money, save a lot of money, sometimes that's
what that's what you want, that's that's exactly what you wanted,
that's what you set out to achieve, and you got it, congratulations.
But very often it's not what you need. What you
needed were relationships, health, mental, clarity, clear conscious that's what
you needed, and that's what would.

Speaker 4 (39:24):
Actually feed your soul. And so I use the example
in the book.

Speaker 3 (39:27):
You cited this earlier when we were hanging out among
the top ten richest men in the world. There are
accumulative fifteen divorces, and so they have everything that they
wanted in terms of money and lifestyle and possessions, and
a lot of them, without passing too much judgment, at
least at various times, did not have what they what
they needed, but they absolutely needed. And you can imagine

(39:48):
too that the ninety five year old millionaire who's in
very poor health. Everything he wants, not what he needs
kind of thing. But I think that that afflicts a
lot of people.

Speaker 2 (39:55):
You know, I'm trying to remember who it was. Might
have been Noah Smith. We were involved in a group
discussion on wealth and happiness, and I think it was
Noah who said, you have to break the world into
two groups. And the group that's been divorced or is
in the middle of going through a divorce, the curve
of their happiness relative to their money looks totally different.

(40:18):
That it's such a miserable experience. Almost no amount of
money is going to change their headspace. And you wrote
something related to that, which is unhappy people, regardless of
how much wealth they have, are always going to be unhappy.
That has to be and happy people the more money
they get up into a certain point continues to bring

(40:42):
at least some degree of happiness and perhaps some contentment.
How true is that? Are some people just unhappy and
nothing is ever going to change that? Yeah?

Speaker 4 (40:51):
I think that's true.

Speaker 3 (40:51):
I mean, that's one of the most important little quirks
of the broader topic of the relationship between money and happiness.
Does earning more money make you happy. The asterisk there
is that if you start out as an unhappy, anxious,
depressed person, it's unlikely that earning money is going to
make you happier. It's not going to fill the hole
that you needed to fill. But if you start out
as a pretty happy, joyful, healthy, content person, earning more

(41:14):
money is leverage on who you already are. So like
in either direction, it's just leveraging who you already were.

Speaker 4 (41:20):
To begin with.

Speaker 3 (41:21):
And so yes, you can find lots of examples of
people who earned a lot of money and had an
amazing life. The money made them very happy. Most of
those people still would have been happy anyways if they
earned less. And we can find plenty of examples of
the cranky, old, crotchety billionaire, and they probably would have
been cranky and croachy. There's no amount of money or
success that would have changed that.

Speaker 4 (41:39):
At its core.

Speaker 2 (41:40):
That's really amazing, really the last question. So right now,
the Psychology of Money is on pace to hit ten
million copies, since this segment is on your writing process
as you were putting this together, and I remember speaking
with you as you were writing this and stitching together
a whole bunch of work. Did you have any idea, Hey,

(42:02):
I'm onto something, or did it just feel like I
got a deadline and I'm not going to make.

Speaker 3 (42:07):
One hundred percent the ladder one hundred percent the ladder.
I think it's true that in many aspects of life
that ninety percent of virality is luck, or it's to
you what we're talk talking about.

Speaker 2 (42:17):
Derek Tom repeated and hit makers and how random hit
records are, and the impressionists, and that book just goes
through a run of Hey but for this, this, and this,
none of these things would be well known and beloved.

(42:37):
Is it really ninety percent?

Speaker 3 (42:38):
That's a wild number, and sometimes I'm making that up,
but that's what it feels like. I mean, the first
print run of Psychology Money was five thousand copies because
all the data that we had at the time was
that would be a big success. And if you know
anything about publishing, selling five thousand books is no small
feet right to get five thousand people to pull out
their credit cards and pay for your words. That's that's
that's a that's that's a success. Can I tell you

(43:00):
it's so funny you say that.

Speaker 2 (43:03):
So I read the initial manuscript over the summer, and
then the hard copy shows up a couple of weeks ago,
and I went through it a second time. And as
I'm reading it, I'm sitting on a big, comfortable chair
in a well lit room with a lovely view out back,
and I'm thinking, you know, I don't really need a

(43:25):
lot of money to be happiness. I just need twenty
seven bucks to buy a book to read each week.
And what is more delightful than either lying in a
hammock or sitting in a comfy chair and taking two
thousand hours of somebody's intellectual output for twenty seven bucks.
Is there a bigger bargain in all of the world

(43:46):
than purchasing a well written book and a.

Speaker 3 (43:49):
Thirty dollars hammock and a nice view and a warm
cup of coffee doesn't take that much.

Speaker 2 (43:54):
A cup of tea when I'm reading absolutely coming up,
we continue our conversation with Morgan Housel, author of the
best selling book Psychology of Money, discussing how he writes books,
essays and columns. I'm Barry Results. You're listening to Master's
Business on Bloomberg Radio. I'm Barry Redults. You're listening to

(44:30):
Masters in Business on Bloomberg Radio. My extra special guest
is Morgan Housel. He is the best selling author of
Psychology of Money as well as Same as Ever his
latest book, The Art of Spending Money, Simple Choices for
a Richer Life. So the book shifts from your previous
writing how we think about money, how we make money,

(44:52):
to how we actually use it. What inspired that pivot, I.

Speaker 3 (44:58):
Think a lot of it was if you asked me
five years ago what my investing philosophy is. I could
sit here for hours and tell you my philosophy is
of investing and why I do what I do, and
what the logic is behind it and how it fits
my person. I could talk to you all day about that,
and you and I have over the years talk about
that topic. But if you ask me five years ago,
what is my spending philosophy? How do my wife and
I think about how we spend our money? And I

(45:20):
couldn't really tell you anything. I hadn't really thought about it.
And as I look to there are literally tens of
thousands of books written about how to grow wealth. Tens
of thousands of books written about how to grow wealth,
virtually none written about what to.

Speaker 2 (45:32):
Do with it.

Speaker 3 (45:33):
It's one of the few areas in finance that has
not been trampled over yet. And I think part of
the reason why is because we intuitively assume that nothing
needs to be said about it, that yes, we know
how complex markets are, and so we can talk all
day about the intricacies of it. But when you talk
about like spending money, I think most people's intuition at
least is like, you just spend it, you just buy things,

(45:54):
and then it's better, So it's all good. And I think,
but if you observe people, rich people, poor people, everybody
in between, you realize it's not that simple. That there
are some people who have gotten a lot out of
spending money, have done it very well, have used it
as a tool to live a better life, and there's
probably an equal number of people who've done a very
poor job about it, for whom it controlled their personality

(46:14):
equal a lot more, maybe more, they were chasing a
phantom life that they could never keep up with. They
were constantly torture mentally tortured by keeping up with the Jones.
Is that kind of thing that's actually that's like, there's
such a deep psychology of it in there, and so
what the book does is I don't tell you how
to spend because I don't know you.

Speaker 2 (46:33):
I don't say very subjective and very subjective. It's called
the art of spending money, not the science of spending money.

Speaker 3 (46:39):
Right, and which also mirrors how I think about investing.
I don't think there's one right way to invest. People
have very different personalities, different risk tolerances and whatnot, and
it's the same for spending. But I think the psychology
of how people think about envy and contentment and happiness
and social aspiration that tends to be universal.

Speaker 4 (46:55):
So that's what the book digs into.

Speaker 2 (46:57):
I love the quote, and I don't remember who I'm
stealing this from. Nothing is more infuriating than seeing your
idiot brother in law get rich.

Speaker 4 (47:06):
That was JP Morgan.

Speaker 2 (47:07):
Unbelievable, right, absolutely true. There's a quote of yours that
I'm not going to steal. I'll give you credit. And
this speaks right to how subjective our experiences are. Your
personal experiences make up maybe point zero zero zero zero
zero zero zero one percent of what's happened in the world,

(47:28):
but perhaps eighty percent of how you think the world works.
I love that quote.

Speaker 3 (47:33):
Explain it, you see it a lot in a lot
of fields, particularly politics. Of the life that you have lived,
the experiences you've had, the town that you live in,
the employment situation that you face during your life, makes
up your view of the world, your model of how
the world works, and therefore it influences what you think
should happen next. And virtually everybody does this, that what
you have nothing is more persuasive than what you've experienced firsthand.

(47:56):
And you can go out of your way to try
to understand other people and be empathy of what they've
been through, but nothing makes more sense to you than
what happened to you personally. And since we've all had
very vastly different lives, different generations, different countries, different parts
of the world, we all have different models of how
we think the world works. And it's you know, a

(48:17):
criticism of my first book, The Psychology Money, were people
who would write and say what you wrote might be
true for a college educated white American male, but it
is what you are, which is what I am guilty
of stories. But they would say in a way that
they were absolutely right to say, it's different for me
in this country, in this generation, whatever it may have been,
And I would say, yes, I totally get that. I

(48:38):
try to make the point in the book, but I'm
still beholden to the lens that I have lived, as
everybody is.

Speaker 2 (48:44):
You know, the greatest thing you could do to get
out of your own little bubble is just travel across
the country by car, and suddenly you realize, oh, now
I understand. This is why farmers say what they say.
This is why people out in the Midwest vote the
way they do the country or the world. And it's
really a shame that less than fifty percent. I don't

(49:07):
know if the statistic is still true, less than fifty
percent of Americans have a passport used to be a
data point. I don't know if that's still correct. But
you get out in the rest of the world and
suddenly you say, oh, we're not the only ones who
know how to do this. Other countries do this specific
thing better than us. We need to be more open
minded about our narrow little experience.

Speaker 4 (49:29):
And the better question.

Speaker 3 (49:30):
If you see someone who thinks or acts very differently
than you, the question you want to ask is not
why do you believe that?

Speaker 2 (49:37):
It's would I believe.

Speaker 3 (49:38):
The same thing if I were living in your life
and almost all the time. The answer is yes, that
if you were the farmer, you would also vote the
same way that if you lived in Russia or China
or Venezuela, you would also think the same way as
they do. And so it's very easy to criticize them,
like you know, to criticize other people. Look at how
dumb they are making these decisions when you would do
the exact same thing if you were in there sit So.

Speaker 2 (50:01):
Let's get focused on the book, because there are some
wonderful quotes and wonderful chapters in it. One of the
themes throughout is the trade off between wealth as a
source of freedom versus riches as a status symbol. Explain
the difference.

Speaker 3 (50:17):
I make up these definitions, so this is just my
view of it, but I would define rich as you
have the income to buy the things you want. You
can make your mortgage payment, you can make your car
lease payment, whatever, you can purchase the lifestyle you want. Wealth,
I would say, is having some level of independence over
both financial independence in order the ability to work where

(50:37):
you want as often as you want, is take time
off when you need to, retire when you want to.
But also like intellectual independence, you don't have to pander
to other people. You don't have to pander to a
boss or to clients or two regulators. You have the
independence to be who you are and wake up every
morning and say I can do whatever I want today.

Speaker 2 (50:55):
That's wealth.

Speaker 3 (50:56):
And the interesting thing is there are people who make
millions of dollars a year who are rich and have
no wealth whatsoever. And there are people who make fifty
thousand dollars a year who are not rich and are
extremely wealthy and their ability. For example, I use the
example of my late grandmother in law on the book.
For thirty years she lived off of nothing but seventeen
or eighteen hundred dollars a month in social security. She

(51:17):
had no pension, no assets, no n she was broke,
seventeen hundred bucks a month soci security. Happiest woman you
ever mean in your life, happiest woman you will ever meet.

Speaker 2 (51:26):
Ever.

Speaker 3 (51:26):
She was perfectly content. She had no money, but she
didn't want any of it. She was totally happy and
content working in her garden and going for walks and
like bird watching with her friends. It's all she wanted
to do. And so she had no financial wealth and
she was like off the charts. Psychological wealth. She had
total control over her expectations. Part of it was she
was a child of the Great Depression, and like that.

(51:48):
I'm sure that had an impact on it. Back to
you know, we're just mirrors of our past experiences. But
you and I know people who are extremely wealthy on
paper who are the opposite. They might be billionaires, they
have financial wealth, and they have no psychological wealth. And
unlike my late grandmother in law, she they wake up
every morning being like it's not enough.

Speaker 4 (52:06):
I need more, I need more, I need more.

Speaker 3 (52:08):
So the difference between financial wealth and psychological wealth is
a big part of it.

Speaker 2 (52:12):
The most valuable financial asset is not needing to impress anyone.
The ability to not need to prove yourself to strangers
is priceless. I heard this how much of our bad
spending behavior is just simple, simple primate status seeking within

(52:33):
the tribe.

Speaker 4 (52:34):
I think a tremendous amount of it. Man, you don't need.

Speaker 3 (52:36):
To be to look very far to see that. I
heard this great quote from the comedian Jimmy Carr recently.
He said, in your twenties, most people worry about what
other people think of them. In your thirties, you say,
I don't care what anybody thinks of me, And in
your forties you finally realize the truth, which is that
nobody was thinking about you all a lot.

Speaker 4 (52:54):
And it's such a.

Speaker 3 (52:55):
Wonderful It's such a wonderful quote the idea that nobody
is thinking about you as much as you are, and
nobody cares about your house, your clothes, your jewelry, nobody
cares about it as much as you do.

Speaker 2 (53:05):
They're busy worrying about themselves.

Speaker 3 (53:07):
I think that realization, at least for me, was so
liberating to be like, look, why am I trying to
peacock for strangers if they're not even paying attention. What
I want to do is use money as a tool
to help the things and lever the things that actually
make me happy, which is time with my kids, health, independence,
Like those things are great. But to the extent that

(53:27):
I'm just using it to try to gain the attention
of strangers who are too wrapped up in their own
heads to even pay attention to me, then that was
That was a very freeing and liberating moment.

Speaker 2 (53:38):
The spotlight bias is fascinating because we're all the lead
characters in our own story, but in everybody else's story. We're,
you know, walking on actors extras just in the background.

Speaker 3 (53:50):
Yeah, I mean I remember seeing this study of they
would take somebody and put them in like an ugly sweater,
and then they would send them into a party and
then they would you know, the person would mingle around
the party in this hideous sweater, and then they would
ask everybody else at the party, did you notice the
woman in the ugly sweater?

Speaker 4 (54:07):
And everyone's like, no, no, no, didn't pay anytime.

Speaker 2 (54:09):
I have a pimple over here that I've been thinking
about the whole time.

Speaker 3 (54:12):
But if you asked the woman who was wearing the
ugly sweater the test subject, how many people notice? She
basically says everybody. We always overestimate the extent that other
people are thinking of us.

Speaker 2 (54:21):
Huh, that's amazing. Let's talk about time. Money's greatest intrinsic value,
and this can't be overstated. You wrote is its ability
to give you control over your time. So we know
that's very true when it comes to earning money and
investing money. Is it true when it comes to spending.

Speaker 4 (54:41):
I've been a big saver for my whole career. I
know you have as well.

Speaker 3 (54:44):
You know I live blow, I mean save and invest
the majority of what I make, and I've never viewed
it as saving money or delayed gratification. I think I
always viewed it as purchasing independence and I get a
benefit out of that right now today. And I think that,
like very simple reframing of it is important. If you
view it as saving money, idle money, delayed gratification, it

(55:05):
feels like a burden.

Speaker 2 (55:06):
It feels like work, and.

Speaker 3 (55:07):
It feels like, yes, I have this wealth, but I
need to go deploy it like quickly. I think if
you view it as every dollar that I save is
a piece of my future that I own, and I
get benefit out of that right now. I get benefit
out of knowing that I'm independent today, it's not delayed.
That's been an important shift in thinking for me that
all I want out of money is to be independent.

(55:29):
I just want to be able to wake up every
day and say I can do whatever I want today,
even if most days I wake up and say I
want to work today.

Speaker 4 (55:36):
I want to be productive.

Speaker 3 (55:37):
It's my choice, and I can do it on my
terms with the people who I like, and quit when
I want to do what I want to. That is
more valuable than any material possession you can have.

Speaker 2 (55:47):
I really didn't start spending money until my fifties. Like,
I was a worker saver for most of my life,
and it was only you know once. I never had
a midlife crisis. But you start to realize, and certainly
the pandemic, I think very much made everybody realize, Hey,
life is short and you never know when your number

(56:09):
comes up? So what am I waiting for? I think
there was a lot of that going on. Have you
made that pivot? Have you? Like? Because I know I
recall when you were in DC and you were looking
for houses back on the West Coast. I remember you
wrestling with do I really want to buy a big house?
How many kids we can have? How has that spending

(56:31):
decision felt? How has yours personal spending change?

Speaker 3 (56:34):
My wife and I have loosened up over the years.
Very You and I have known each other for fifteen years,
and we've been We've spent a lot of time personally
together talking about our own lives and whatnot.

Speaker 4 (56:43):
And you've known and.

Speaker 3 (56:44):
I think you've probably given me playful grief about how
cheap I used to be. It's always been a thing
I've always been, or I was for a long time,
very cheap, but my wife and I were totally content,
and it always kind of not bothered me. But I've
always found it interesting that people would give me so
much reef about how little I spent when the truth was,
like we were, we were living a great life. We're

(57:04):
at we're thrilled with what we did, and we've loosened up.
We spend considerably more money now than we did five
or ten years ago, but it's always just been on
the framework of independence, because the truth was, ten years ago,
I bought anything I wanted.

Speaker 4 (57:17):
It just wasn't that much, just didn't want that much.

Speaker 3 (57:20):
And today we buy anything we want, and it's just
marginally a little bit more because we have kids and
we've we've found new things that bring us joy and whatnot.
And so it's always been I always feel like we've
been in control over it, even when we are very frugal,
or today when we've loosened up a little bit, it's
always been our choice, not pushed or forced about by
social forces and society and marketing.

Speaker 2 (57:41):
You know, it's funny, my wife is the conservative spender.
I'm I'm the value conscious spendthrift now, so I will
buy stuff, but I have to feel like I'm getting
value for money. All the junk I've bought over the years, watches, cars, houses, whatever,
every thing I own, I could sell for more than
I paid, because I feel like like I can't imagine

(58:06):
walking into a dealership and saying to the manager of
the Ferrari Ferrari of Long Island, I'll take that five
hundred dollars. It's unconscionable to me.

Speaker 3 (58:19):
It's never too late for a midlife crisis, though you
can still figure it out.

Speaker 2 (58:22):
You know, it's not so much a midlife crisis as
it's been a post pandemic. Life is short. What are
you waiting for? And in the office, we are constantly
telling clients true story. I get a call from a
client wants to buy a Ferrari, wants to buy a
sail boat, and someone says, oh, Barry's boater and he's

(58:42):
a car guy. I talked to him and the answer
I told him is, you've never been a sailer. Why
are you going to spend two million dollars on a
fifty foot sailboat that a needs a crew and b
you'll use twice and sell for a half a million
dollar depreciation. But by the way, this guy can buy
a month for the rest of his life and still
leave a nice estate to his kids. Go buy the Ferrari,

(59:05):
and not only by the Ferrari. Take the kids to
the Ferrari High Performance Driving class, which the dirty secret
about all these racing schools are effectively defensive driving courses.
In drag, it's all about staying within your skill set,
staying within the parameters what the car can do. You

(59:25):
become a better safer driver, even though it's about epets,
turns and high high speed driving. And he did He
did that. He bought the Ferrari, loves it, took the
fam to the course, everybody had a great time with
the boat, sold it a year later, took a big hit.
I'm not allowed to mention the boat anymore so, but.

Speaker 3 (59:46):
I think I think you could easily imagine a client
that was the opposite that they're like. Sailing has always
been my dream, change my life, absolutely, and and they
loved it. And they also bought a Ferrari, and a
week later said why did I do this?

Speaker 2 (59:58):
It really depends on who you are. The joke about
boaters is every boater's favorite boat is their second to last,
because they only always go one step too far. Now, no, no,
the forty foot was plenty. I don't need a giant whatever.
But that's very much a case. So let's bring this
back to the book and spending. Talk about the connection

(01:00:21):
between money and happiness and what is spending for contentment mean?
How does happiness and contentment differ.

Speaker 3 (01:00:29):
I think one of the issues with money and happiness
is that we chase the wrong emotion. We chase happiness,
and it seems very well intentioned. Of course, I want
to be happier. You want to be happier, that's great.
The problem is that happiness is always a fleeting emotion.
People are rarely happy for more than a couple minutes
at a time. I think it's very similar to humor,
where if I told you the funniest joke you've ever heard,

(01:00:49):
you laugh for a couple of minutes.

Speaker 2 (01:00:51):
A couple seconds, you don't last at the next you don't.

Speaker 3 (01:00:53):
Last for ten years, laugh for ten years, and just
doesn't work that way.

Speaker 2 (01:00:56):
It's always fleeting.

Speaker 3 (01:00:57):
So I think when you daydream about the new house,
the new car, the boat, when you daydream about how
great that will feel, buy and large, what you are
imagining is being content with those things. You imagine yourself
in the future house, sitting in the living room, and
what you actually imagine is yourself being saying I'm good,
I'm totally I don't need anything bigger. This is what

(01:01:17):
That's what feels good, the like picturing and imagining contentment
feels amazing. And I think that's what people should aspire to,
not necessarily happiness by contentment. And I think that's always
a goal, because you're not truly independent if you're not
fully content.

Speaker 2 (01:01:32):
You know. That's to me, that's the value of buying
a lottery ticket for two bucks. Isn't the one in
a billion chance that you're going to win one hundred
million dollars. It's the twenty minutes you get to sit
around joking about what you would do with one hundred
million dollars. That's fun.

Speaker 4 (01:01:47):
Yeah, of course.

Speaker 2 (01:01:48):
I remember having an argument with my sister we were kids.
What do you mean you wouldn't buy me a car?
All right, maybe I'd buy everybody a car? What about this?
What about buying a half? And it was we were
having this hilarious debate. No one want anything was the
dollar lottery ticket? So that's always fascinating. I love the

(01:02:08):
story that Cal Richards tells. For people who don't know
who call Richard is. He's the sketch guy does these
wonderful little diagrams. Had a New York Times calm for
a long time, and he tells a story of being
big biker, loves cross country biking. There was a bike
he was jonesing for six thousand dollars for this really

(01:02:28):
high end, ultra lightweight titanium bank bike, and he couldn't
bring himself to pull the trigger. And his wife says,
you bike four times a week, go buy it. And
he said a year later, it's the best purchase he
ever made. He goes out with friends, he has these
memories from it. It's just been wonderful. How do you
distinguish between the purchases that are going to bring you

(01:02:52):
joy and the purchases that are just empty, unsatisfying babbles.

Speaker 3 (01:02:57):
I think you kind of hit the nail on the
head there when you said Carl buying the bike, it
was great because of the experience, because he goes out
with his friends and he creates all these memories with
and like that's what made him happy, not necessarily the bike.
It was what the bike allowed him to do. I
think it's similar for homes, where, well, buying a big
mansion make you happier, The answer might be yes, if
it makes it easier to have your friends over and

(01:03:17):
have your If.

Speaker 2 (01:03:18):
You tell in the book about people who have houses
that feel like hotels are so large needs a staff
of four hundred to run, nobody's happy in those houses.

Speaker 3 (01:03:29):
Right, And you can compare that to someone who lives
in a fifteen hundred square for the house but has
their friends over every Friday for a barbecue and they
stay up till one in the morning, laughing with each other.

Speaker 2 (01:03:37):
That's a better life. That's a way better.

Speaker 3 (01:03:38):
So it's not what the possessions can do, it's how
can they or what the possessions are. It's how they
can serve as a conduit into things that make you
actually happier. And for everyone those things exist. It's like
maybe buying a bigger house will make you happier, and
buying a cool car. If you're spending time with your
friends and you're going you're taking your kids to track
races and one doilege you're talking about, maybe that doesn't
make you happierually not a direct thing, because you can

(01:04:01):
easily imagine buying the mansion but having no friends, having
no family, and you're sitting there alone, and then you're
wondering why you feel unfulfilled, why you dreamed for years
of having this house, and now you're sitting in it
and you're like, I don't feel anything. It's because the
only situation which it would actually make you happier and
more content is what it would serve as a lubricant
for for bringing other people over that actually make you happy.

Speaker 2 (01:04:23):
Quick car story that I think you'll appreciate. So one
of my projects was taking a three hundred thousand kilometer
eighty seven nineteen eighty seven nine to eleven coup that
had been an accident single owner for like twenty five years.
The body and the interior was in really good shape,

(01:04:44):
but it needed a lot of mechanical work. And I
took this long story short, converted it to an ev
It's long process, and I was kind of horrified at
all the Porsche purists who would just torched me for
doing such blasphemy. And a friend owns a detailing and

(01:05:06):
wrap shop and he hosts a big cars and coffee
every year, and he's like, hey, can you bring the EV?
I don't really know if I want to do that.
I'm going to get, you know, really beaten up over it.
He's like, trust me, it's a great crowd, that all right.
So and this car ended up costing me everything said
and done, about what it would have cost me to

(01:05:28):
walk into a Porsche dealership and say give me that
nine to eleven brand new and not in Probably the
same is true where you live where I live. Nine
elevens or cameras, they're everywhere, right, they're they're valuable, but
they're not rare, whereas Ferraris are rare and valuable. So
I bring the all right, I'll bring the EV and
I bring it to this event. It's about fifty sixty

(01:05:49):
seventy cars, and I'm right across the way from a
guy with the brand new half a million dollar Ferrari cylindery.
It's its new front engine, twelve cylinder. And so I
opened the front where there's a big battery pack, and
I opened the back where the engine's supposed to be,
and there's another battery pack with a Tesla motor on
the bottom. And I just braced myself for people coming

(01:06:13):
up and just like, oh, you destroyed this car, and
I was so wrong. People were fascinated, and by the
end of the day I felt bad for the guy
with the Ferrari. Yes he was there by himself, no
one was talking to him. I had a steady stream
of people saying, Wow, this is really cool, this is different,
this is a one off. It doesn't hurt that the
license played is EV nine to eleven. It's the first

(01:06:35):
one in New York. That was genuinely surprising to me
that it wasn't something that you could just buy. It
was something that created a little required a little thought,
a little creativity.

Speaker 4 (01:06:47):
And foster relationship.

Speaker 2 (01:06:48):
And I, oh god, people giving me cards, Hey I
want to I'm hosting this event. Can you bring this
car like it was? And every time I bring that
car anywhere, people lose their minds.

Speaker 4 (01:06:59):
That's great.

Speaker 2 (01:07:00):
So it's so fascinating. And it wasn't a function of
spending a boatload of money. It was a function of, Hey,
this is kind of a kind of different you have
every time I spend money. You're in the back of
my head. I want to go through a couple more
quotes before we get to our favorite questions. You cite

(01:07:25):
the University of Pennsylvania professor Killingsworth. If you're already an
unhappy person, it's unlikely that more money will ever fix
your problem.

Speaker 4 (01:07:35):
Yes, it could leverage who you are in either direction.

Speaker 2 (01:07:37):
Either direction. And then our friend Michael Batnik said something,
I hope I'm not talking out a class. Wealth seems
like a burden and an obligation. The people I know
have become wealthy, other people treat them differently. They always
have their hands out at a certain point, it doesn't
seem like it's worth it.

Speaker 3 (01:07:57):
I think everyone can make it worth it, but it's
easy for it to spiral out of control and to
let it change the what other people think of you,
your family, your friends, the rest of society. And so
it's very easy to think that when we are spending
a lot of money, we are gaining people's admiration. But
you have to be careful because often what you are,
the emotion you are fostering, is envy. The other people
envy you, and that's and that it's it's hard in

(01:08:19):
real time.

Speaker 4 (01:08:19):
To know which is which.

Speaker 3 (01:08:20):
You're like, oh, they're looking at me, they're looking at me,
they're talking about and they're talking about me like they
admire me, I don't know.

Speaker 4 (01:08:24):
They envy you, which means they hate you.

Speaker 2 (01:08:27):
So that's a good point to bring up. Fomo. Fomo
is recklessness massed as ambition.

Speaker 3 (01:08:32):
Explain, it's outsourcing your critical thinking to other people. And
those other people got rich quickly, which of course is
going to is going to inhibit their own ability to
think rationally and cleanly about it. It's a very dangerous thing.

Speaker 2 (01:08:44):
Let's let's talk about wealth as everything you don't see,
which is effectively double entry accounting. You see the asset,
you don't see the liability.

Speaker 3 (01:08:54):
Yeah, I can see your house. I can see your car,
you're not your your your ev nine to eleven car.
I can't see your bank account. I can't see your
brokerage statement. I can't see how much you save for retirement.
Like all wealth is actually hidden because wealth is the
money that you didn't spend.

Speaker 4 (01:09:06):
It's the cars you didn't buy.

Speaker 3 (01:09:08):
The vacations you didn't take, it's money that you've saved
for independence, and it's completely invisible. And it's pretty pernicious
because if you think, like for physical health, you can
see physical health. This person's overweight, this person's ripped there
you can see it, and so it's easy to find
a role model. I want to look more like that person,
less like this person. For money, it's very difficult to
do because you can't see wealth.

Speaker 2 (01:09:28):
You don't see the hit debt, you don't see the leverage.

Speaker 4 (01:09:30):
You don't see the leverage, you don't see what went
into it.

Speaker 3 (01:09:32):
And of course there are a lot of people who
appear to be wealthy who are absolutely broke, and the
reverse is true. So it's very difficult to know who
to follow, who to take your cues from.

Speaker 2 (01:09:41):
I love this quote, and this is your words. If
you're a good dad, a good husband, an honest person,
a hard worker, a helpful friend, and a funny joke teller,
you've probably earned ninety eight percent of the respect and
admiration that I'm capable of giving you. If you happen
to be rich and successful, I might bump that up

(01:10:02):
to ninety nine percent, but.

Speaker 4 (01:10:03):
Let's not pretend it makes much difference.

Speaker 3 (01:10:04):
I told that to a good friend of mine, who
is one of my favorite people in the entire world.
Earns a modest but not substantial income, and it bothers him,
and I told him that one day I was like, look,
if you have these, like if you're a good husband,
a good father, if you're fun to hang out with
and you're funny, that's about all the respect and admiration
I can give you. And if you happen to make
more money, like okay, kind of cool. Maybe that brings

(01:10:25):
some more stories and whatnot, but it doesn't make much difference.
I like you for this stuff, not the stuff that
you're actually chasing.

Speaker 2 (01:10:30):
Last question before we get to our favorites. What do
you think people don't know about the art of spending
money but should what's the most important aspect of this
that just seems to slip by unnotice, Probably that.

Speaker 3 (01:10:43):
There's no formula for it, that what works for you
might not work for me, and vice versa. And a
lot of people get into trouble with finance, whether it's investing, earning,
or saving or spending, when they follow the advice that
is good for one person but not for them. And
it's a very vicious trap to get into because because
it worked for somebody else, you're like, oh, I just
that's what I should do. It worked for them, it
surely should work for me. You have to spend more

(01:11:05):
time kind of looking in the mirror, so to speak,
and figuring out who you are, what you want.

Speaker 2 (01:11:09):
Really really great insight. All right, let's jump to our
favorite questions, starting with who were your early mentors who
helped shape your career.

Speaker 3 (01:11:19):
I would be lying, and I'm not blowing smoke if
I said you and josh I think an equal amounts.

Speaker 2 (01:11:25):
You're gonna have to explain that You and josh this.

Speaker 3 (01:11:27):
Would have been twenty thirteen, were some of the first
people who recognized me outside of the Motley Fool who
broke me out of that now I was, I felt
good and was comfortable within the zone of the Motley
Fool for their members or whatnot.

Speaker 4 (01:11:40):
I had a pretty big audience. There's pretty good.

Speaker 3 (01:11:42):
You and Joshu were the first ones outside of the
Moley Fool who recognized me.

Speaker 4 (01:11:46):
And I feel like that was unbelievable.

Speaker 3 (01:11:48):
And I think about this a lot of like, when
you see somebody like that, particularly if they're young, anything
you can say or do to help them is enormous.
It might be the smallest thing in the world to
DM them or reach out and say, hey, you're doing
some good work.

Speaker 4 (01:12:02):
I'm really proud of me. I like your stuff.

Speaker 3 (01:12:04):
It takes you nothing and it can completely change their life.

Speaker 2 (01:12:07):
Nothing brings me more joy than hearing people say things like.

Speaker 4 (01:12:10):
That, because well, that's the only nice thing I'll say
about you today.

Speaker 2 (01:12:13):
Because the thing that's so amazing is these are throwaway
lines that you say, Hey, really like that column, really
like that piece. I thought it was that to you.
It's three seconds and of little bit of honesty and
someone says this was really meaningful that I kind of
felt like I was lost or I kind of felt
like no one was appreciating me, and just hearing that

(01:12:36):
somebody recognized that I had some skill and talent was huge.
You forget what it was like when you were in
your twenties and thirties, grinding away unnoticed for decade or so. Right,
how long were you with the Motley Fool Book was?

Speaker 3 (01:12:49):
I was there for ten years before I left, But
I remember when you and Josh did that for me.
It was twenty thirteen. That's how you know. Vividly I
remember it, and I remember how much the confidence boost
that it gave me to keep going was enormous.

Speaker 2 (01:13:00):
Well, that's a lovely view to say, I really really
appreciate it. Both of us have an eye for talent.
I could, I could, I could say that, and you
have fulfilled all of our highest aspirations for you. Let's
talk about books. What are you reading right now? What
are some of your favorites? And I know when you

(01:13:21):
finished writing a book, like the whole process, you're not
reading anything other than research. Yeah, so talk about your favorites.

Speaker 3 (01:13:30):
I'm reading a book right now by by by Stefan Zwig,
who was a journalist in the in the twentieth century,
and he wrote his memoirs, which is basically about how
the world went from he was living in Austria and
in Vienna, and how the world went from before World
War One, Europe was so civilized and so great, and
everyone viewed that that would discontinue indefinitely, that it was

(01:13:53):
so organized and so polite and so which, of course
is somewhat of an exaggeration, but that was the view
that he had. And then he's about how the world changed,
both with World War One and then especially with World
War Two, and how everything happened that nobody thought would
have been possible before it happened, and how culturally and
socially that world changed.

Speaker 4 (01:14:11):
That's that's some reading right now.

Speaker 2 (01:14:12):
That, thank goodness, something like that would never happen here
exactly right. Let's talk about streaming. What are you listening
or watching these days? Be it? I don't want you.
This is in another solicitation for a compliment. But what
are you watching? What are you listening?

Speaker 3 (01:14:26):
I finished Succession not too long ago, one of the
one of the best I've ever seen. One no, no, no,
And I didn't take that at all, one of the
best I've ever seen.

Speaker 2 (01:14:34):
I love every second episode. I don't like any of
these people.

Speaker 4 (01:14:37):
Oh but that's the point.

Speaker 3 (01:14:39):
I loved every second of success Now and then I
just finished Your Friends and Neighbors.

Speaker 4 (01:14:43):
That really good.

Speaker 2 (01:14:44):
I believably good. I can't wait for you. Ham just
gets better and better, so good. And if when that
first came out, he hosted Center Live, and I want
to say, the best episode all season, so good.

Speaker 4 (01:14:55):
I can't, I can't. I can't wait for the second
season of that.

Speaker 2 (01:14:57):
There's a lot of stat spending earning. I mean, it
fits right into the sweet spot of what you write, and.

Speaker 4 (01:15:05):
Just such good writing character development.

Speaker 2 (01:15:07):
There our final two questions, what sort of advice would
you give an recent college grad who was interested in
the career and either investing or writing about finance, Read as.

Speaker 3 (01:15:17):
Much as you possibly can. It's very boring advice, but
that's everyone. No one has more confidence in their ability
or where they think the world is going than a
twenty one year old man who's never read a book
about history of investing. Nobody thinks they've figured it out
more than that. And spend as much time as you
possibly can, reading as much as you can from the
diverse field of topics that you can.

Speaker 2 (01:15:40):
And our final question, what do you know about the
world of investing, writing, earning, and spending today that would
have been useful back in the financial crisis when you
were first launching your career.

Speaker 3 (01:15:53):
We mentioned diverse things there, like writing and spending, and
I actually think I have very similar philosophies on both,
which is when I write, I want to write for
an audience of one, which is me. I just want
to write things that I think are interesting, telling stories
that I think are funny and unique, and if other
people like them too, that's wonderful. But I know that
I can't please everybody, and that's just an inevil part
of it. So if I'm gonna pander to one person,

(01:16:16):
it might as well be myself. And I think that's
how I spend money too. I spend to please myself
and my family, and I don't care if other people
do it differently. I don't care if other people think
it's the wrong way to do it. It's what works for me.
And again, if I'm going to pander to anyone in
how I spend it might as well be myself.

Speaker 2 (01:16:32):
Well, thank you Morgan for coming in. This is everything
I was expecting it to be. We have been speaking
to Morgan Housel, author of The Psychology of Money, same
Innette as Ever and the new book The Art of Spending,
Simple Choices for a Richer Life. If you enjoy this conversation,
check out any of the five hundred and eighty one

(01:16:53):
podcasts we've done over the past eleven years. You can
find those at iTunes, Spotify, YouTube, Bloomberg, wherever you find
your podcasts, And check out my new book How Not
to Invest The ideas, numbers and behavior that destroy wealth
and How to avoid them at your favorite bookstore. I
would be remiss if I did not thank the Cracked

(01:17:14):
team that helps put these conversations together each week. Alexis
Noriega is my video producer. Anna Luke is my podcast producer.
Sage Bauman is the head of podcasts here at Bloomberg.
Sean Russo is my researcher. I'm Barry Ritolts. You've been
listening to Masters in Business on Bloomberg Radio.