Why The UK Lags Other Countries As An Investment Opportunity with Andrew Craig

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Is the UK still a global investment powerhouse, or has it fallen behind? In this insightful episode, financial author and fund manager Andrew Craig uncovers the key reasons why the UK economy and stock market have underperformed in recent decades — and why that could be about to change.

UK GDP per capita has remained flat for 30 years, while countries such as Ireland, Singapore and Australia have more than doubled their wealth. Since 2007, the London Stock Exchange has lost half its listed companies, and major firms continue to seek listings abroad. Across the UK, even affluent high streets are struggling, with empty shops and declining footfall.

Yet Andrew reveals a surprising turnaround. Despite the gloom, UK value stocks have begun to outperform the S&P 500. Institutional investors are once again showing strong interest in British equities, driven by valuations that are up to 60 percent lower than their US counterparts. With sentiment shifting, the UK is now viewed as one of the best value markets globally.

We explore why less than five percent of UK adults invest through a stocks and shares ISA, despite historical data showing UK microcaps returned 16.4 percent annually between 1955 and 2021. Andrew outlines a straightforward strategy for building wealth, including the widely endorsed "100 minus your age" asset allocation rule, and explains how financial literacy can uplift not just individuals, but the economy as a whole.

This episode also examines what needs to change in government policy to restore the UK's investment appeal and whether the next bull market could emerge before broader economic recovery takes hold.

If you are a UK investor looking to understand current market dynamics, uncover long-term value opportunities, or improve your personal investment strategy, this episode is essential listening.

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Disclaimer: All content on this channel is for education purposes only and does not constitute an investment recommendation or individual financial advice. For that, you should speak to a regulated, independent professional. The value of investments and the income from them can go down as well as up, so you may get back less than you invest. The views expressed on this channel may no longer be current. The information provided is not a personal recommendation for any particular investment. Tax treatment depends on individual circumstances and all tax rules may change in the future. If you are unsure about the suitability of an investment, you should speak to a regulated, independent professional. Investment figures quoted refer to simulated past performance and that past performance is not a reliable indicator of future results/performance.

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Episode Transcript

Dr James (00:00):
The state of the UK and what it means for your
investments is the topic oftoday's podcast, which is
actually something we've neverdone on the Dentists Who Invest
podcast before, and I don'tquite know how, because it's
been like four years.
I have today joining me MrAndrew Craig, author of how to
Own the World and also financialis it fair to say financial

(00:20):
commentary expert.
Is that fair to say, andrew,because you do talk about that
stuff a lot, right?

Andrew (00:24):
That's very kind.
Yeah, I guess, yeah, but Ithink a finance author is the
number one thing, but also afund manager and, as we were
just talking about, before weclick, record a YouTuber.
We're now growing the YouTubechannel quite nicely, which is
good.

Dr James (00:39):
Excellent.
Well, listen, let's talk aboutthe state of the UK, the state
of the UK's current economy andhow that pertains to our
investments as well, because Iknow that that is something that
you cover in how to own theworld and actually this is
something that I meant to askyou, so I'm glad that we've got
this platform to be able to havethis conversation on.
I remember in your bookscorrect me if I'm wrong there

(00:59):
was a lot of points that youtalked about the uk in your
books and you were like the ukjust shoots itself in the foot
when it comes to the investmentside of things.
Right, and I can feel I couldliterally feel some of your.
It was, it was a motive, rightit was a motive, right you
writing that?
and I could tell when I wasreading the book.
Yeah.
So I'm just curious, maybe justto set the stage.

(01:20):
Why do we feel like that's thecase?
We can start out not sopositive and then we can finish
on a high right, yeah well, lookit's.

Andrew (01:28):
The uk is very interesting at the moment
because, you know, without quiteand let's be clear I don't want
to get party political becauseI and I mean just to get that
out of the way, straight out thegate I don't believe that
there's any political party thatI could in good faith give my
vote to.
That.
I've seen in years, like infact in most of my adult life,
but you know, certainly sincethe late 90s until today,

(01:51):
however long.
That is because the basiceconomic illiteracy of
demonstrably of you know,successive chancellors, all the
way from Gordon Brown up to thepresent day, has been terrible
and you know that's why a bigpart of the reason that you so.
Uk GDP per capita today isbasically roughly where it was
30 years ago.

(02:11):
Right, it hasn't moved in 30years.
Right, and a lot of people laythat at the door of Brexit,
which is very naive andbasically doesn't acknowledge
the fact that that's been a 30year car crash and Brexit only
happened, you know, nine yearsago, whatever it is now, and in
the same time, that we'vebasically made no progress at
all in terms of the averagewealth of people in this country

(02:33):
.
Tons of other countries in theworld have done as good as
double theirs, right?
So Singapore, australia,ireland you know the Republic of
Ireland, the other side of theborder, from from where you grew
up.
You know ireland's now nearlytwice as wealthy as as as
britain on gbp capita.
Australia.
And obviously, you know america.
Everybody knows about denmark.
You know all these countries.
So it it's um, it has been asource of frustration to me

(02:57):
because I think the reason thatbritain has made such little
progress has an enormous amountto do with terrible policy and
really bad politicians, andparticularly policy as it
relates to financial markets andUK capital markets, and I think
this is, you know, I wrote apiece a few months ago about how
this stuff what really drove menuts last year.

(03:20):
Whoever, whichever politicalparty you none of what I'm
talking about right now was anelectoral issue.
So, basically, britain's reallypoor and going backwards, or
it's flat at best, butrealistically, in real time,
it's probably going backwards.
We had 3,250 companies listedon the London Stock Exchange a
generation ago, like 2007-ish,not even a generation ago.

(03:44):
Today, that number is less than1700.
And we've lost 90 in the lastyear or so, in about four or
five in the last couple of weeks.
Right, they are dropping likeflies and I, you know, I think
anybody who's reallyeconomically literate and
understands these things whichsadly, without wanting to sound
like an ass, there aren't thatmany people in Britain at the

(04:04):
moment moment who do, sadly it'sa big part of our problem
particularly our political classcan can draw a straight line
from that reality, from the factthat we've lost half of our
stock market listed companies inlike 30 years, to the reason
why the british economy is inall sorts of trouble.
You know, in our high streetsare just sort of tumbleweed, you
know, boarded up.
I I live in what used to be apretty affluent town in

(04:26):
Hampshire, right Close to London, commutable distance out of
London, in all the sort ofleague tables, you know,
allegedly one of the nicestplaces to live in the UK, leafy
green suburban.
You know Hampshire, and it'slike a ghost town, it's
tumbleweed, and you know there'slike charity shops and barbers
and you know we all know vapeshops and whatever else and that

(04:48):
is replicated up and down theland and it's obviously
something that's been in thepress and you know.
So I think the fact that we'vesort of eviscerated the British
stock market and there's a huge,the huge part of why that's
happened has to do with reallybad policy, which I don't want
to bore people with, but it'skind of true and that is a huge

(05:09):
part of that.
British shares are a massivebuy, like structurally right.
Because stock markets startdiscounting, they start trying

(05:38):
to basically start buying intoan equity market quite a few
years before the bottom.
So even if, like the Britisheconomy in real terms, like Main
Street Britain is going to berubbish and just get worse more
unemployment, more insolvenciesyou know I posted a piece
yesterday about just how manypubs in the UK are going
bankrupt right now because theChancellor's changes she made in

(05:59):
the budget last year.
They've made 80% of pubsunprofitable structurally right.
It's carnage, it's absolutecarnage.
Up and down the the budget lastyear, they've made 80 of pubs
unprofitable structurally right.
It's gonna, it's carnage, it'sabsolute carnage.
Up and down the country, in inhospitality, you know, in in
pubs in gp surgery seasondentists, as I'm sure many of
your, you know, I'm sure many ofyour audiences are feeling the
pinch in terms of nationalinsurance and all these taxes

(06:19):
and everything else.
Um, but actually, amazinglyenough, uk value equities have
now been outperforming the s&pfor quite a few months.
Um, and, interestingly, um souh, there's a big investment
bank lots of people have heardof.
They used to be called merrilllynch until the global financial

(06:41):
crisis when it merged with bankof america, so it's now Bank of
America Securities, but one ofthe really big investment banks,
like JP Morgan or Goldman Sachsor Morgan Stanley, and they do
one of their big flagship thingsthey do every month is the
global fund manager survey.
So they basically send aquestionnaire out to like I
don't know a thousand probablyleading fund managers all over
the world, in New York andBoston and LA and Singapore and

(07:03):
Zurich and Geneva and London andwhatever in Frankfurt, asking
them for their views on capitalmarkets.
And then they pull that alltogether and it's a really good
piece of research that's used alot by the investment banking
and fund management industriesand it gives you a kind of steer
on how people who controltrillions of dollars are

(07:23):
thinking about various differentmarkets.
Right, and here's a crazy funfact for you.
So, basically, for I think I'mright in saying for like 49 of
the last 50 months, the londonstock market has been the least
loved of all developed worldstock markets out of all of them
for, like you know, five years,every month, right and um in in

(07:46):
.
It was either february or march.
It was still the most unlovedstock market in the world by,
you know, people who control allthe money, and so it was either
last it was either april or may.
Um, basically the point was itwas the.
It was the least loved in theworld, and the following month
it was number one.
So in the biggest institutionalsurvey of people who control

(08:13):
all the trillions of dollars inbig investment funds around the
world, britain, the Britishstock market, has just swung
from the most hated to the mostloved.
Now that might unwind in thenext survey.
It might be an ephemeral thing.
There was a result of Trump'sLiberation Day stuff and tariffs
and, oh, hang on, look at theUK.
That might actually be, youknow, the dollars having a
challenge, american equities arehaving a challenge, american

(08:34):
bonds certainly are beingchallenged, and notwithstanding
how bad our economy is in realterms, the other point is
British shares are 60% cheaperthan American shares across the
piece.
So big people who control, um,you know, big pots of capital
will look at that and go enoughis enough.
Is Britain cheap enough?
So?
So that's a weird dynamic.
So there's no, no question, theeconomy is terrible and it's

(08:57):
likely to get worse, withoutquestion.
I mean like it's going to getso much worse before it gets
better in terms of unemploymentand everything else.
Um, and in numbers, number ofcompanies going bust, number of
our companies being acquired byoverseas investors but that's
like the old expression, youknow, the time to buy a market
is when there's blood in thestreets, right, that probably
makes britain quite anattractive investment, um, which

(09:19):
is kind of crazy, right.
And, and particularly smallercompanies, because if, if, large
britain, if the footsie 100 doreally well in the next few
years, based on the record ofhistory and the way these things
work, smaller companies willprobably do very well.
So, anyway, yeah, there you go.
Sorry, my standard.
What is that?
Like a six or seven minuteanswer, sorry, mate that's what

(09:39):
we want.

Dr James (09:39):
We want full-bodied answers and that was that ticked
the box, which great.
And one thing that caught myear when you were talking and
this was quite one of the thingsyou initially said you
referenced policy and howpolicies.
You know, certain policies arewhat we can point the finger at
for the issues that youhighlighted just there.
Let's take to anybody who'slistening we're not talking

(10:02):
political here.
We're not saying it was thisparty's fault or this party's
fault.
We're just speaking from theheart.
Well, just to be clear it'sboth parties' fault.

Andrew (10:11):
I mean, again, this makes me sound like I'm a
Taurian.
I'm not really.
I'm actually a small governmentlibertarian for what it's worth
, and that electoral option isnot available to me in this
country or indeed most othercountries, sadly, but I, indeed
most other countries, um, sadly,but I I will say that I saw
john major speak at a conferencein london last year and he was

(10:31):
unbelievably impressive, like he.
It was funny because hepresented and mark carney was
the other presenter, who's nowthe you know, who was the bank
of england governor and is nowthe prime minister of of um
canada, as I'm sure you know.

Dr James (10:43):
you'll be aware yeah, I did see that that was an odd
little.
I don't quite know how thathappened, but very impressed,
very good for in the pocket ofthe globalist, the davos massive
.

Andrew (10:51):
But.
But all I'll say is I thoughtcarney I hope he never sees this
uh podcast I thought keep, butcarney was deeply unimpressive
and I I really did.
And I thought john major wasjust wiped the floor with him
and like like he's like 82 orsomething, and he was just
fantastic and all I was going tosay is so I then sort of John
Major was talking about some ofthe achievements that they did
in the early nineties and really, you know, coming out with all

(11:13):
the problems around the exchange, you know the year, the genesis
of the Euro and the exchangerate mechanism and Black Monday
and all this stuff.
A lot really tricky stuffhappened on his watch and and
actually he was sort of he wasquite amusing, um, but his basic
point was that he kind of leftTony Blair and Gordon Brown, a
UK economy in 97 that was inabout the best position it had

(11:34):
been in for many, many years,after doing the hard work and
taking the hard yards and takinga bunch of hard decisions.
And I sort of thought aboutthat and went and looked uh back
at kind of that time and Ithink, to be fair to him.
That was a fairly accurate youknow he was probably the last
British Prime Minister whoactually did a pretty good job

(11:55):
with the UK economy and withpolicy.
Then Blair and Brown came in.
And let's leave aside I thinkyou know, because I posted about
recently the.
You know, gordon Brown sold ourgold at, like, you know, not
quite an all time low, but likejust just, and I've written
about it and it's just one ofthe most egregious cock ups.

(12:18):
It's cost us by now about 40billion, certainly dollars,
possibly even pounds.
You know, imagine if RachelReeves had 40 billion more quid
right now.
That would probably be a goodthing.
So that's, and it just thehubris of that man, of Gordon
Brown, just blows my mind.
Like you know, the IronChancellor I'm such a great
Chancellor, you know so manydecisions he made were awful and

(12:40):
the other big one was.
So they changed the taxtreatment of dividends and I
know this sounds so boring,right, but they made a number of
changes to pension funds andhow that all worked and it's a
complicated line to draw and youhave to have a really good
understanding of institutionalinvestment and stock markets and

(13:01):
capital markets, investment andstock markets and capital
markets.
But if you do have thatunderstanding, you can draw a
fairly straight line betweenthose decisions made in the late
90s to that point I made aboutBritain being fundamentally
structurally poorer than all theother countries have become in
that time, which is a fact,right, and to the fact that
we've lost half of our stockmarket companies.
To the fact that, you know,wise has just gone to New York

(13:22):
or got left London, arm Holdingshas left London.
You know we've lost like 140billion quid of British
companies off the London stockmarket since Rachel Reeves came
to power, right, and that that'sjust continuing the tragedy of
the last few years.
But and one of them they made aload of policy changes and the
Tories compounded it over manyyears.
But listen to this.
So they changed the taxtreatment of dividends, which

(13:44):
doesn't sound like much right,sounds like, you know, pension
funds can afford it for pensionfunds.
Pension funds should be able toafford that.
The estimate is that itbasically raised about five
billion quid a year of tax intothe exchequer.
But by now, a conservativeestimate of what it has cost the
British economy is well northof 500 billion pounds, so half a

(14:07):
trillion quid.
So these are the trade-offsthese politicians make and they
don't think about the law ofunintended consequences, they
don't think about the momentum.
So if you do something thatbasically fundamentally
challenges the effectivefunctioning of the London Stock
Exchange, the rot sets in andthen hedge funds start shorting
it, then the companies startleaving it and it's just this
cascade of negative consequenceswhich, 30 years later, is why

(14:31):
we're in the pickle.
We're in economically.
And the thing that annoys memost about all of this is that I
reckon if you did an exam ofthe 650 sitting MPs in
parliament right now of all thisstuff and indeed of how the
bond market works and therelationship between the bond
market, british government,borrowing, interest rates,
inflation, I'd be amazed if 10of them could pass that exam.

(14:55):
Like I'm not.
You know I'm sort of notpulling my punches because I'm
just so consistently astonishedat how bad our policy is.
But you know, because we have apolitical class that just
doesn't understand these thingsand that's why they make these
terrible decisions.
And if and the key thing Ithink, without wanting to do be
too political is, what does thatmean?
It negatively impacts millionsof people's lives and the

(15:17):
quality of the society we livein, and I don't know what the
answer to that is, but I'm just,I'm setting out the bad, as you
said at the top of the call,like, let's, we'll do the bad
news and then we'll.
There is good news, there'scountervailing good news, but
yeah, we, britain, has just donean astonishing job at shooting
ourselves in the foot on anynumber of levels, and
particularly with respect tocapital markets, in the last 30
years, and that is why we're soeconomically challenged, you

(15:41):
know it's interesting, right,because this is something I
wanted to ask.

Dr James (15:46):
Maybe someone who has your sort of background and
knowledge on this topic Correctme if I'm wrong.
I mean, this is all I can't say, that I've looked into this,
you know, and researched this,yeah, but am I right in saying
you've got, obviously you've gotBritain, and Britain is what

(16:08):
like?
If you look at GDP, you knowwhat is it like?
Seven to eight in the world,overall, something, yeah.
And then you've got France isalways below it, right, and the
gap between France and Britain,yeah, they kind of swap a lot,
they move, move around.

Andrew (16:23):
Yeah, correct, but if I'm not wrong.

Dr James (16:26):
Right, the gap between France and Britain has
increased quite a bit inBritain's favor over the last
few years, and maybe that's Icould be wrong.
We need to actually researchthis.
Is that maybe because France isjust not doing that well versus
Britain doing exceptionallygood?
Something along those lines?

Andrew (16:45):
I'll tell you what, given that we now have these
amazing tools, why don't we saylive, and in full effect who has
higher GDP?

Dr James (16:58):
We should research this the.

Andrew (17:01):
UK.
I think I'm actually not surethat's right.
I think they're they'regenerally pretty close to each
other.
So, yeah, okay, april 2024 RMFestimate, uk 3.59 trillion,
france 3.13 trillion.
And then GDP per capita, though, which is ultimately the more

(17:23):
important thing, yeah, I don'tthink it's quite as good as GDP
per capita.
Yeah, GDP per capita.
I'll be interested in so yeah,okay, uk says um purchasing
power parity, so adjusted forcost of living.
They're identical.
Amazing, where uk is 26th inthe world, france is 27th, with

(17:48):
like literally 100 bucks a yearmore than them, but but but that
okay, so that's france, butokay, in the the last 30 years,
denmark, holland, singapore,australia, america, ireland,
south South Korea.
I think I'm right in saying aswell, um, the middle, all the,

(18:09):
all the wealthy middle Easterncountries, so Abu Dhabi, qatar,
uh, dubai.
You know the list is long, butit's probably like 20 countries
have sweden, there's another onehave have seen their gdp per
capita grow a great deal andbritain's basically been
stagnant.
And actually the reallyshocking thing is that if you,

(18:31):
off the top of my head, I think,if you take the top one percent
of wealthiest people out ofBritain which, by the way, is
happening anyway, like you cantake them out of Britain because
they're all leaving Britainright now then the rest of the
population, on average, has beengoing backwards.
And if you take London out ofthe UK, outside of London, the

(18:55):
economy is basically becoming athird world country.
Outside of London, the economyis basically becoming a third
world country.
And so I think somebody wassaying to me and I haven't fact
checked this and I need to factcheck this, but so Poland
definitely has a higher GDP percapita than ex-London UK right
now, and I think the CzechRepublic does too, but somebody
was telling me that Albania does, or that, or that albania's

(19:18):
forecast to have a better.
Now I'll take that with a pinchof salt, because I can't
imagine it's that bad by now,but then again, so poland's
basically had an economicmiracle in the last decade,
right, it's been on a massivetear, growth wise, and so to me
it's like well, look around theworld at the policies of the
countries that are succeedingright and then emulate those

(19:41):
policies.
Don't look around the world atthe policies of the countries
that are falling apart and whereeveryone's getting poorer and
emulate those.
To me, that's just a no-brainer, and it just blows my mind that
we don't seem to do that.
So, anyway, this has becomecrazy stats but those, those are
some crazy stats.

Dr James (19:58):
But no, I do agree.
It's like you know, you've gotgrowth, but it's relative growth
, right, which is just asimportant as in percentage,
right, like, and if you've gotall these countries that are
doing extremely well, um, andbritain is maybe not doing as
well to that level, what can welearn, right?

Andrew (20:15):
well, yeah, that that's right and actually the worst is
yet to come, sadly, and again II want to make that.
I want to make a real point ofthe difference between main
street and wall street isobviously in the american
vernacular right.
You know the real economy of ofcompanies and jobs on the
ground and and people just goingabout their daily lives, doing
whatever they do, and financialmarkets and what the stock

(20:38):
market in particular may or maynot be doing.
Because and the example I'vecome back to a lot on this
because I think it's quiteeye-opening for people is so one
of the biggest rookie mistakesof people who really don't
understand financial markets andamazing enough you see this
from like supposed financeexperts a lot on tv and stuff
right talking heads is there'svery, very little short or

(21:01):
medium term relationship betweenthe performance of the economy
and the performance of thefinancial markets.
And like a massive rookiemistake is to go oh, there's
going to be a recession,therefore I should.
You know the stock market'sgoing to crash.
Or you know there's been a biggeopolitical issue like iran and
israel and you know, therefore,the stock market's going to
crash like 99 times out of 100.

(21:22):
There's just no relationshipthere.
There's a relationship over avery, very, very long run that
takes years to play out right.
So if there's a recession andequities are expensive,
eventually you'll get a crash,but it'll take.
It'll be years after theinitial data point of the
recession, and there's a reallygood example of that dynamic
which tends to blow people'sminds.

(21:42):
So, ok, march 2020, you turn theTV on, what were you seeing?
You're seeing people onventilators.
You're seeing people dying inChina and in Italy and in
America and in Britain, and youknow everybody's out banging
pots and clapping the NHS everyThursday evening.
And and then right it was.
It was almost like livingthrough an actual horror movie,
right, as we all remember it.

(22:03):
Um, and lockdown something else.
So so if in March 2020, whenbasically we were living through
a horror movie, if you'd gotout to the street and asked 100
people passers-by would youinvest in the stock market today
, what do you think their answerwould have been?

Dr James (22:20):
well, they all would have said no, but they should
have said yes.

Andrew (22:23):
Right, because that's I reckon, I reckon, empirically,
I'd be amazed if it wasn't atleast 95 percent that would have
said are you kidding?
Like of course you don't.
You know we're in a COVIDcrisis, okay, so in, I got to
get them the wrong way around.
But it's something like in 2000, the US, the S&P 500 was plus
19%, 18.7% or something.

(22:44):
And in 2021, sorry, in 2020, tobe clear, not 2000,.
In 2020, it was up like 18.7%or something like that.
And in 2001, it was up like 26something percent.
Right, so in so so from in thein the 24 months after, during
and after the arguably thebiggest crisis since, like I

(23:06):
don't know, the second world waror vietnam, or whatever you or
whatever you decide it, it wasthe most recent one that was
that bad, like x million peoplearound the world being killed.
Um, the US stock market had twoof its best up years in like a
century, right, and so that, andagain, I'm telling you that 95%

(23:27):
of people would not havebenefited from that.
And if you said to them in theheight of the COVID crash do you
think you should invest instocks?
They'd go no way.
There's no way.
I'm doing that and I, and Ireckon that, as at this moment,
right now, sitting here in june2025.
If you asked people the same,you know what did the stock
market do incredibly well in thetwo years during and after

(23:48):
covid.
Still today, a huge percentageof population will say no, it
must have crashed becauseactually relatively few people
properly follow financialmarkets.
I mean your audience.
Do your audience probably havea decent idea of what the level
of the s&p 500 is and what it'sdone in the last 10, 12, well,
20, 50, 100 years, right, 95plus of british adults have no

(24:11):
idea, like you know, literallyactually, I as a as a funny
aside, I, um, I was interviewingcandidate when I used to work
for swiss bank early in mycareer, in my sort of late 20s.
Whatever I was interviewing, youknow keen graduates coming in
looking for a job, um at um atswiss bank, and one of the first
questions my colleague asked um, this young graduate who is at

(24:34):
cam Uni doing economics, andthey said so, you've said in
your application you're reallyinterested in stock market,
investment and stock markets.
What's the level of the FTSEtoday?
And this individual said 57,000.
And we were like it's likeanyway.

(24:54):
Sorry, that was probably anamusing story for an
ex-investment banker, but notfor everyone else.
It was just, like I just said,a level that the footsie had
never been even vaguely near, ornot even at that point 10 of
that level.
So we were like you can't bethat interested in investment,
but anyway that that.
That anecdote is just kind oflike and that's a cambridge
economics graduate, you know,and the rest of the population I

(25:16):
always go back to it like fewerthan 5% of British adults have
a stocks and shares ISA, and ofthat tiny minority, that is
crazy, seriously it is.
What?
And you know, I know you're afan of crypto, but you know more
British adults have invested incrypto than have invested in
the stocks and shares, isa andagain.

Dr James (25:36):
this is why, Even as a fan of crypto, I think that's
actually bad.
I think that's a bad thing.

Andrew (25:41):
But why that's bad?
I think it's really importantto explain why that's bad,
because when people invest instock market businesses and
again, this is really poorlyunderstood and I get this
trolling nonsense online all thetime so when people invest in
stock market listed companies,doing real things in the real
economy, they do real things inthe real economy.

(26:02):
So, like you know, I floated,uh, carluccio's, the restaurant
company in a in one of my jobsyears ago, right, and we raised
how many I can't remember whatwas it 26 million quid or
whatever it was for carluccio'sto roll out restaurants in the
uk.
So now there's a nice car, niceCarluccios in high streets here
and there and shopping centersright, that's a real thing.
That employs thousands ofpeople, that gives somebody a

(26:25):
nice option to go for casualdining if they fancy a plate of
pasta and a glass of red orwhatever.
Right, real stuff in the realeconomy.
And money that goes into analtcoin in particular, like we
can argue about Bitcoin.
Bitcoin has a sort of digitalgold role to it, for sure, and I
concede that, but most almostall of the.
So what's so?
Crypto is 3 trillion andBitcoin is like 1.8 of that or

(26:47):
something.
Is that about right?

Dr James (26:48):
Yeah, it fluctuates Bitcoin dominance.
It can be 20% of the market,70%, but anyway around that.

Andrew (26:56):
Right, so let's just say like the crypto is worth three
trillion of bitcoins, worth oneand a half whatever the accurate
numbers are like that, yeahthat tells me the other one and
a half trillion dollars.
Almost all of that has beendeployed in a non-productive way
.
It won't open a factory, itwon't open a restaurant train,
it won't buy any 737s for anairliner, you know it won't do

(27:16):
any real world stuff and, if I'mhonest, that really pisses me
off.
But as somebody used to work atthe coalface of companies that
do real stuff and employ peopleand pay taxes, right and so, and
just quick, to sort of comeback on that to my point about
trolls, very few peopleunderstand, so lots of people
come out and go.
That's nonsense, because if youinvest in shares like, you're

(27:39):
just buying shares of somebodyelse who already owns the shares
, the company doesn't get themoney.
And that is correct as far asit goes, because that's what's
called the secondary market.
Like most transactions instocks and shares are secondary
transactions.
If you buy Apple stock today,you're buying that Apple stock
out of the market from somebodyelse who owns apple stock.
You're not giving apple like,if you buy a million quids worth

(28:01):
of apple, your apple doesn'tget a million quid, right,
that's right.
Except that the the existence ofthat secondary market is what
enables companies to to have aprimary market, which is when
they either float on a stockexchange in an IPO and raise
hundreds of millions of dollarsto do whatever, or if there are

(28:22):
lots of buyers of your stock inthe secondary market, your share
price will be higher, whichmeans if you then need to sell a
load of new shares and raisemoney, you do it with much less
dilution.
Or if you want to acquireanother company and use your
shares to acquire that company,you have a competitive advantage
if your share price is higher.
So a strong secondary marketfor shares which, by the way,

(28:47):
london just simply does not haveanymore, sadly, because of
governments means that.
So imagine now you're a Britishcompany and, on average,
british shares traded at about a60% discount to American shares
at the moment.
Right, and that means if you'rea British management team and
you want to buy like, say,you're an oil company and you

(29:08):
want to acquire a small oilcompany in Africa or Asia or
whatever, and so does anAmerican oil company, and so
does an American oil company theAmerican oil company has to
take 60% less of a punch in theface in terms of the dilution of
their equity to use theirshares to buy the company.
So who do you think is going tosucceed in buying that company

(29:31):
the British company or theAmerican company?
British companies, likesomething like 350 billion quids
worth of British companies,have now left the London Stock
Exchange and gone to anotherstock exchange, like mainly
America, but some have gone toAustralia, and every time that
happens, that takes huge amountsof wealth and intellectual
property and employment awayfrom the UK, which is something

(29:52):
that's really really poorlyunderstood.
So, yeah, sorry, I'm slightlyon my soapbox today, but it's I
just think it's really importantthat more than 0.01 percent of
the population understands thisstuff, because, whilst nobody
understands it, the governmentcan get away with pretending
there's no problem and talkingabout us being a tech superpower
, which is just gibberish youknow that stat about how few

(30:15):
adults actually have stocks andshares.

Dr James (30:17):
Isa blows my mind because on Denison Invest and I
have to say right, and you knowI'm definitely, I hope I don't,
you know, come across like I'msaying I'm solely responsible
for this.
But I remember at the startwhen we made Denison Invest, you
know I would talk to Dennis andthey'd be like I don't, I've
never heard of an ISA.
You know what I mean, whereasit seems to me nowadays the

(30:42):
dentists that I talked to onthere.
Most of them actually have, likeisis, make maybe 50, 60 percent
.
Do you know what I mean?
Yeah, um, so I guess the reasonI'm telling that story is not
to say, hey, look at me, orthat's great, or whatever.
It's more to say that I got theimpression that a lot more
people in the general populationwould have them as well.
But obviously that's completelyskewed, like it's just nuts.

Andrew (30:58):
Well, I mean there's so much to say about the first
thing to say is 19 millionbritish adults are like as, as
defined, definitionallyfinancially challenged.
So 19 million british adults,basically, are close to poverty,
have no savings, you know.
So none of them are going toget a nicer right or well.
Unless they can get it, youknow, chart a course back, but

(31:22):
that's chicken and egg.
You know.
Why are so many peoplefinancially challenged?
Because we're not creating anyjobs.
We're not, we can't.
Nobody can raise money.
Nobody can raise the hundredsof millions or tens of millions
required to do something likeopen a restaurant group or a
chain of cinemas or whatever.
Our high streets are dying, sothere are no jobs.
There's much higherunemployment.
Um, we've also got an agingpopulation which factors into it
.
But the other thing I would say, so that that's great, and I

(31:43):
think you should give yourselfcredit, because you know one of
the things that will sort thiscountry out is if 20 million
more people sort out an isa, youknow, and at least their their
financial affairs.
Right, but as is, because theother thing to say that's even
more eye-watering is so fewerthan 5% of British adults have
an ISA, stocks and shares ISA.

(32:04):
And let me come back to thedifference in.
Well, actually, let's do it now.
So part of the reason.
So I remember early on, when Ipublished my book and started
posting about stuff like this,somebody said to me oh, isas are
rubbish, why would I everinvest in an ISA?
I can only get 2% in an ISA,right, or whatever.
And it's like they didn't knowthe difference between a cash
ISA and a stocks and shares ISA,and so that's such a massive

(32:25):
failure of our society.
And, by the way, there's Xhundred billion quid in cash
ISAs, which, of course,guarantee that you're going to
lose wealth because the returnin the cash ISA is lower than
real inflation, and so like howwe can have a situation where
you know, a disproportionateamount of people who do have
ISAs have a cash ISA, which is aterrible product like.

(32:47):
You should only ever usesomething like that for very
short-term purposes, um, and andfor longer term stuff, you must
have stocks and shares oryou'll just never become wealthy
, right, right, but?
But check this out the tinyminority of British adults that
have a stocks and shares ISA.
There's some extraordinary stat, no-transcript, right, so they

(33:12):
have an ISA, but all they'vedone is own Tesla and Apple or
Meta and like Microsoft orwhatever Like.
So most of that capital is nowin big tech stocks, which is, or
they're, in an S&P 500, whichis much better, but it's still,

(33:41):
you know, cash and crypto and ina holistic kind of top down.
I understand all of them and Iunderstand how to use them in
the right mix.
Based on my age and stage, Ireckon it might not even be a
hundred thousand people likeseriously, and that is just
that's why people are gettingsuch bad outcomes financially.
Right, let's just, and we're.
You know our tax base is beingeroded and the economy's screwed

(34:04):
.
So, yeah, that's why I get Iknow you do too but that's why I
get quite passionate about thisstuff and I love doing these
podcasts no hell.

Dr James (34:10):
Yeah, man, like it's when people can see the part
like the emotive side isimportant too.
Right, because people are like,right, there's something here
like this guy cares, it can makea difference, he cares on our
behalf.
Therefore, we should up ourgame too.
Can I just say one thing onwhat you were saying a second
ago about the stocks and shares,isa.
Uh, as in there's, it's onething to have the isa right and

(34:33):
then there's another thingentirely to know what actually
goes in it right.
Like, sometimes, very rarelythis happens because naturally,
when you're on dentistry invest,we talk about this stuff.
You know what I mean and youget to speak to lots of dentists
and I think that they they'requite happy to share this stuff
with me because it kind of comeswith the territory.
They're kind of expecting totalk about that whenever they
speak to me, whereas maybe itdoesn't come up so much in

(34:54):
normal conversation.
But you know, it's interesting,right?
Um, when we talk to the dentistor when I talk to dentists
about the stocks and shares, Isaid, uh, some of them not that
many, thankfully, but some ofthem are like, yeah, I got a
stocks and shares.
I said I just put the money inand it sits there right like
they don't get that.
You're actually supposed toinvest in it, to do something
with it.
And then the ones, some that doand, by the way, I say this with

(35:16):
compassion and I say this withlove, right, because I'm saying
this to let people know what'sout there and how everybody else
is doing, relatively speaking,the people that do, that's a
very small portion to thankfully, maybe like 5% of people that
have come across.
The other 95% yeah, they havesome form of portfolio.
But if of people that have comeacross, the other 95, yeah,

(35:39):
they have, they have some formof portfolio.
But if I'm putting my financialplanner hat on, even though I
am a dentist and I'm not afinancial planner, not an ifa,
just making that super clear,but obviously from running our
finance firm vader, let's justsay you pick up a few things,
yeah, and when I see theirportfolios I would say virtually
90 of the time there'ssomething to optimize there as
in they've got like individualstocks that are just randomly
there, that they've just stockpicked, or maybe they've got way

(36:01):
too much bonds relative totheir goals and objectives.
At their age, exactly At theirage and there's always things to
optimize.
Do you know what I mean?
And I would say it's probably10% of the time that I speak to
someone and they tell me abouttheir ISA and I'm like yeah,
you've actually got it figuredout, Like you've got a good
portfolio there.

Andrew (36:18):
Basically, and appropriate for your age and
your earnings and your riskinclinations and your dependence
and all that Cause that's right.
I mean, like in financialadvice per se, you have to be
incredibly careful about likeone size fits all you know
panacea, answers right.
Incredibly careful about likeone size fits all person.
You know panacea, answers right.
But if there is one you knowidea on those lines that sort of

(36:38):
works for everyone.
Is that what I've talked abouta lot?
If I may oh, actually yeah, ifI may just brandish so my first
book you know how to own theworld.
I know most of your.
They go.
It's over my shoulder there, um, and then this one live on less
invest.

Dr James (36:50):
The rest is the is like, if you like, but how to
own the world's, the.
And then this one we justpublished Completely fine, shout
out how To Own the World.
I'm a big fan of how To Own the.

Andrew (36:54):
World.
Live On, less Invest.
The Rest is like, if you like,but how To Own the World's the
theory and that's the practice.
For a British person, becauseit's aimed at the Brits, and
that's the new version we justpublished in February, by the
way.
Oh, nice, Annoyingly the audiobook is being held up in
Amazon's process for weeks.
So we published the printversion in February and the

(37:15):
ebook in February and the audiobook's still not available, but
hopefully it's dropping any day.
But anyway, the reason Imentioned that is because one of
the big themes in that bookthat wasn't in how to Own the
World is this idea of a hundredminus your age, which is about
as close as a sort of you know,shooting from the hip rule of
thumb.
That kind of works for everyone, because all that is is like
and, by the way, it's not myidea and john bogle from

(37:36):
vanguard, I think, was one ofthe first people to popularize
that idea but it's basicallyjust that if you think about
investments that are aggressive,higher return, higher risk
investments, like the stockmarket or certainly crypto, and
then investments that are lowerrisk, defensive, but lower
return, like cash or bonds and Iwas to say, like gold, you see
gold's a weird one because Ithink it's defensive but it's

(37:58):
outperforming the S and P for 25years and my lane my next
YouTube video is going to beabout that.
Yeah, it's up a thousand.
So gold priced in pounds hasgone from 220 pounds an ounce to
2,400 pounds an ounce in since,since, uh, you know, the
beginning of the millennium,right?
An ounce since the beginning ofthe millennium, right?
That sounds bad?
Yeah, correct.
And so, actually, my next videoseries on YouTube I'm doing on

(38:21):
gold.
We just did five videos aboutproperty and these ones about
gold.
But the point I was going tomake is, if you use the 100
minus your age, all it tells youis a basic rule of thumb 100
minus your age is subtract.
Subtract your age from 100,gives you roughly how much you
should be investing inaggressive, high-risk,
high-return stuff.

(38:41):
So if you're 30, you should be70% in the stock market and 30%
in cash, bonds, gold, and ifyou're 70, it should be the
opposite of right round.
And the reason for that I thinkI've said this to your audience
before, but just to go into itagain is because if you're 30
and you have a 50 stock marketcrash and you're completely in
the stock market, you might haveturned 10 grand into five grand

(39:03):
and you've got the whole of therest of your, because you've
probably only got about 10 grand, you know.
But if you're 60 and you'vebeen a dentist for your whole
career and you've got a millionquid and you're 100% in the
stock market.
In the same scenario, 50% crashhas turned your million quid
into 500 grand, just when you'reon the brink of retirement and
it's like it's crazy how fewpeople understand these nuances,

(39:24):
but they're actually not verydifficult.
You know that 100 minus your ageis simple.
Then, well, you know.
All you then need to understandis the difference between a
defensive asset and aggressiveasset, so that you can get that
mix right and then just justinvest every month, you know,
for as long as you can, and youwill get a fantastic outcome,
like a life-changing outcome,and you know, the tragedy is
that, as we're saying like I,probably 99 of british adults

(39:45):
don't understand this stuff.
That's just not so bad you knowwhat?

Dr James (39:51):
thank you for that?
Uh, full-body dissection ofwhat the Brits us Brits could be
doing better.
Right, how about some positivenews now?
What have we got to lookforward to?
There must be something goodout there.

Andrew (40:02):
So there you go.
So I have this sort of you knowfor the beginner 100 minus your
age, you're 25.
So you're gonna be 75 in a bigglobal equity index, right, um?
And the answer to that iseither s&p 500 or msci world or
footsie, all world right.
And basically, if you're amassive believer in american
exceptionalism, americadominating, by all means have

(40:23):
the s&p 500, but you get massiveconcentration risk in the mag 7
stocks and um I I just thinkthat for the next 30 years a lot
of value could come out ofbrazil or india or china or
whatever.
So I'd rather have the fo toyour world.
That's just my view, right yeah,and actually I think, I think
on a 30-year view, thepercentage, the difference in
the percentage returns, thosetwo things will be negligible
because over time everythingtrends to just kind of global

(40:45):
equity growth this, this wholesorry to jump in, you know this
whole logic, the whole, thewhole reddit logic.

Dr James (40:52):
Uh, reddit the forum that we should all just stick
all our money in the s&p.
I don't think that's.

Andrew (40:56):
That's just not true, man, like it's not on the time
frames that we're talking aboutfor retirement I mean, look, I
think if you invest every month,uh, for 30 years, you can stick
all your money into pretty muchanything and you'll probably be
okay as long as you have thatweather on 100 minus your age.
You have to be careful aboutabout saying that.
But because I had this theother day.
I was presenting an event inLondon and somebody in the

(41:18):
audience went because I wastalking about the merits of
global stock market investmentand the fact that US equities
have delivered more than 10%annualized for more than a
century.
And I was saying and the reasonfor that is there's no whiz
bang, there's nothing morecomplicated than the human
development, right, it's likethere was no airline industry
100 years ago, or hardly anylike now.
There's a massive, you knowmulti-trillion dollar airline

(41:39):
industry.
You know drugs, uh,construction, retail, tourism,
you know entertainment, gaming,like think of all the things
that have happened in the last100 years smartphones, well, you
know internet, like that didn'texist 100 years ago.
That, front and center, is whyus equities have gone up 10 a
year for 100 years.
I mean, not in a straight line,but on average, right, and they

(42:02):
were like, well, yeah, but um,it depends on where you start
and draw the line from.
Because what about the um, thegreat, you know, the great
depression, and the famously Ithink I'm right saying the, the
dow jones index of us stocks,which had a massive crash in
1929, right in the in the stockmarket crash, 29 didn't get back

(42:22):
to the 1929 level until 1957 Ithink it was.
It was either late, the late50s or the early 60s, so it's
like a whole generation.
If you bought, if you justinvested in 1929, the month
before the crash, you were outof pocket and underwater for
like 30 years, right.
And so people who don'tunderstand investment say, well,

(42:45):
you know, stock marketinvestment can be really risky.
It's like no, because that'snot what we're advocating people
do.
What we're advocating people dois they invest every month for
30 years, like from the minutethat you know, from 30 to 60 or
35 to 65, or preferably from 20to 65, because if you do it for
45 years you will be loaded.
Right, if you do this big andof course somebody who bought

(43:07):
does that after the 1929 crash,when the market plummeted, you
bought it at a much, you boughtit at a level that was much
lower than the 1957 level, right, and you did that every month
for the 30 years and you gotdividends.
And so that's the key thing tounderstand is the merits of just
buying every month, getting themix roughly right.
Because, to your point, thatReddit point, if you just buy

(43:31):
the S&P, well, first you'reexposed to American
exceptionalism and I thinkAmerica's teeth are on the brink
of having a massive financialbond crisis right Because of its
debt situation.
That's all part of this tariffstuff, so that could be really
problematic for US equitiesstructurally.
And then you'd be bloody gladyou've got Chinese or Brazilian
or Indian or European equities,if that happens, right To hedge
it out.
Um but, um but the but.

(43:55):
The other thing is that youneed to have that mix of assets,
because the point I was goingto make is that reddit thing is
sometimes called the marketpurist approach, the market
purist which warren buffettadvocates.
It right so there's a guy calleded van thorpe, who's another
brilliant billionaire,billionaire who invented options
trading, basically in the 60s.

(44:15):
He's another one who's likejust buy the market, buy the
market, buy the US market.
Those guys are worth billionsof dollars.
And so the market puristapproach is a really good
approach for anybody who's verywealthy, because imagine if you
are only worth 10 million quidthey're billionaires.
Imagine if you're worth 10million quid.
You know they're billionaires.
Imagine if you're worth 10million quid and you're 100% in

(44:37):
the market and in a terrible,terrible two year you know,
global financial crash, 07, 08,09 or 99, 2000.com crash the
market falls 50%.
You've gone from 10 million to5 million.
Can you still eat food?
Can you still buy clothes?
Can you still pay for petrol?
Can you still clothes?
Can you still pay for petrol?
Can you still travel?
Can you still go on holiday?
Yes, right.
So any very wealthy person canafford to be a pure market

(45:02):
purist and just buy the market.
But anybody who, even somebodywho's quite wealthy, like I just
talked about somebody.
You know a 60 year old dentist.
He's got a million quid or 2million quid in their pension if
it's 100% in the S&P and theS&P has a 50% correction now
they've got a million quid orhalf a million quid.
That's a very different problemto somebody with 100 million
quid who's now got 50 millionquid.

(45:23):
Right Like, in terms of thelife outcome.
So it's all really important.
That's why you know you shouldnever take financial advice from
anyone who doesn't know a lotabout your very personal
circumstances, inclinations,attitudes to risk, because it's
different.
You know I always hate these,like you said, although I
contributed to one for moneyweek the other week, what would
you do with 50 000 pounds?

(45:44):
And I was like well, the firstthing to say is that you know,
if, if, if I had 50 000 poundsand I was a 30 year old multi
multimillionaire who just soldhis tech business, my answer
would be completely different toif I was a 60 year old living
in extreme poverty on a councilestate in Glasgow.
Right Like, what those twopeople should do with 50 grand

(46:07):
is like night and day different.
So you should never listen toanybody who just says on social
media this is what you should dowith 50 grand, because it's so
important to consider personalcircumstances.
Anyway, I'm conscious, I'm justlike rambling away about loads
of different stuff.

Dr James (46:20):
That was my fault.
I pulled us away that time,Cause I I jumped in on the.
S&p thing.
We were, we were all about wewere, we were in the process of
talking about the positives.

Andrew (46:30):
The positives, right, okay, so the positives.
So there's this amazing statwhich is that, back in the real
economy, right, what I wastalking about earlier, like
people opening restaurants ordoing whatever they're doing and
in the old days in London, inBritain, we used to do that by
raising money on the stockmarket.
And in the very old days weused to do that by raising money

(46:52):
in the Leeds stock market andthe Bradford stock market and
the Manchester stock market andthe Glasgow stock market.
And in the very old days weused to do that by raising money
in the Leeds stock market andthe Bradford stock market and
the Manchester stock market andthe Glasgow stock market before
it centralised in London.
And if you actually look at howmagnificent that was as a
technology, the technology ofthe stock market for, you know,
the Bradford Chamber of Commerceor you know, for people
building steel mills inYorkshire or whatever, that's
how it all worked right, andthat's why Britain became very

(47:15):
wealthy and great.
Right, the fundamentaltechnology of stock markets was
absolutely instrumental for allof that, which is why it's such
a shame we've dismantled it.
But, as I said earlier,notwithstanding all of that bad
news.
So AIM, the alternativeinvestment market, the London
microcaps London small caps havehad a terrible, terrible time

(47:36):
for five years but they've juststarted bouncing really heavily
in the last few weeks.
This is my point earlier.
It doesn't take much capital Ifpeople suddenly wake up and go,
my God, like traders like tosay, the cure for low prices is
low prices Right.
Or in the in the long run thestock market's a weighing

(47:56):
machine.
In the short run it's a votingmachine, so ie, the fundamentals
will out.
So British shares are reallycheap and some of them are
really good and pay dividendsand are actually growing.
They are even if the Britisheconomy is so difficult and
tricky.
Some businesses are still doingreally well right, because
they're just that good, like Imean, look at something like

(48:17):
Games Workshop.
You know it makes littleDungeons and Dragons-led figures
and Warhammer and all that.
They're about to do a massivedeal with somebody like Disney
and make Warhammer into a moviewith like Henry Cavill and you
know, get on them Like abrilliant little niche company
and get on them like a brilliantlittle niche company.

(48:41):
But I just think that if Britainrediscovers its kind of
investing zeitgeist and if older, wealthier people realize how
well smaller companies canperform.
So that's what I was going tosay.
So from 1955 to 2021, ukmicrocaps the smallest companies
in the stock market delivered16.4% growth annualized.
16.4%.
That is enough to turn ISAinvestors into millionaires over

(49:03):
like 10, 12 years, right, ifyou max your ISA.
And we've lost sight of that.
The government was about to saythey've lost sight of it, but
they probably never understoodit in the first place because
they know so little aboutcapital markets and stock market
investment.
But you know, we've basicallyforced pension funds in the UK
for 30 years to invest inoverseas shares.

(49:25):
We've exported one and a halftrillion quid of our capital
your capital, my capital, yourdad's capital, everybody who's
watching us capital.
That's all gone to Americancompanies to make tesla
egregiously overvalued, right,um and uh, into bonds, like
because that's supposed to belower risk.
But what that's done isdestroyed our economy and, um,

(49:46):
really challenged our abilityfor smaller companies to raise
money, um, but, but.
But you know, pendulums alwaysswing back and I think there's
half a chance that the marketstarts discounting UK domestic
stocks.
You know, I mean Rolls Roycehas done unbelievably well,
british banks have doneunbelievably well in recent
months and that might be thefirst swallow of summer.

(50:08):
And then if the smallercompanies catch a bid and people
you know, if big US investorsor Middle East investors jump on
this bandwagon and see Britain,you might see British stocks
doing really well for the next.
So put it this way Everybodysays to me why would you ever
invest in British stocks?
They're crap.

(50:29):
I'm only going to ever investin the S&P 500 because they're
so much better quality.
I'm only going to ever investin the S&P 500 because they're
so much better quality.
Okay, you're looking at therearview mirror and for the last
15 years that's been right, butthat's precisely why it's
probably not going to be rightfrom the vantage point in 15
years from now.
So yeah, and like globalinvestors and hopefully smart

(50:50):
domestic investors, will startbuying into this theme some
years before the economy itselfactually recovers, which
certainly won't happen underthis Labour government.
I don't think so that's goingto be four years away from now.
So by the time the economyitself recovers, the stock

(51:10):
market will probably already beup 100%, because that's what
happens every time.
That's what happened in the1970s will probably already be
up 100%, because that's whathappens every time.
That's what happened in the1970s.

Dr James (51:19):
Well, it's a fundamental thesis of everything
that we talk about.
When it comes to investing,it's discount and premium, isn't
it?
You know it always returns tothe mean, doesn't it?
Or at least that's the idea.
Andrew, I've got a fun question.
I've got to ask you this.
It just popped into my head ifandrew craig was pm and andrew
craig could come in and changesome policies and make some shit

(51:40):
happen, yeah, and it didn'teven have to go through the
commons, it was.
It was executive, what would itbe?
What, what?

Andrew (51:45):
does the?
order um, so I think the theeasiest way to answer that
question is to look out at therest of the world and at the
countries that are wealthiestand highest growth and have the
lowest crime rates and the beststandard of livings.
And then, right, and you know,the obvious ones are Switzerland
, singapore, australia,particularly Right, and

(52:07):
increasingly Argentina.
So that gives you a clue,because Argentina has just had
an economic miracle in the lasttwo years or so, since mille got
voted in.
Who's this crazy right-winglibertarian slash and burn
economist right, but, um, youknow, I think I think we should.
So there are loads of policies.
The first thing I'd do is I'dsack 550 mps and have 100 mps

(52:27):
instead.
So, like there are 645 uscongressmen for a population of
350 million, there are 650 MPsin Britain for a population of
65 million.
Like, we have this ridiculouslytop heavy parliament full of
really mediocre and competentpeople and with apologies to any
MPs watching this because Iknow they're not all are, but a
hell of a lot of them aredemonstrably based on the

(52:49):
evidence of what we I mean.
Did you see that interview withthat government minister
yesterday about?
Of what we I mean?
Did you see that interview withthat government minister
yesterday about, who literallydidn't know, didn't understand
any of the points from her ownstatement.
It's just like what In theprivate sector that person would
be sacked like immediately.
Anyway.
But I would slash corporationtax to the lowest in the world

(53:10):
Because, you know, look atIreland.
The Irish are three times aswealthy as we are, gdp per
capita largely because of thatpolicy and, as I wrote, I wrote
in a piece that I submitted tothe telegraph was published in
the telegraph a few weeks ago.
Um, so we, the uk, tookcorporation tax from 29 to 9 or
28 to 19 over five or six years,like 10, 12, 15 years ago,

(53:35):
whatever it was.
So the rate of tax went from28% to 19%.
What did the tax take?
What happened to tax?
How much tax Did the governmenttake?
Less tax at 19% or more tax at19%?

Dr James (53:51):
I'm sensing that what you're getting at is
counterintuitive, so I'm gonnasay it's good.
It took more tax because it putthe rates down right, it took
30 billion more quid right andsimilarly, when labor had the
highest um was it was.

Andrew (54:09):
I should know this, but it was like the.
The highest rate of tax on likeevil rich people was 50 percent
and when it was cut to 45percent, the tax take exploded.
Right, and it's the same.
Norway put a wealth tax on.
They lost all theirmillionaires and billionaires
and they lost out on hundreds ofmillions of dollars of tax
revenue.
And it's just like everybodyknows.

(54:30):
Anybody at vaguely economicliterature, as a student of
economic history, knows thisstuff right, um, so so I would
have much lower corporate taxrates that would engender.
I would completely um sort outthe uh, the uk financial um,
capital markets, the stockmarket, because we, you know
that is where entrepreneursraise money to do stuff, and if

(54:50):
you can't, if they can't do that, they leave, because it's like
you probably know, 11 000, it'ssomewhere between 11,000 and
14,000 millionaires left Britainlast year.
Right, and they're the verywealthy people.
They're not millionaires,because I mean, there's this
nonsense.
You hear where people go.
Oh, there are 3 millionmillionaires in the UK.
No, there aren't.
There are 3 million propertiesvalued at more than a million

(55:12):
quid, a hell of a lot of whichis covered by mortgage debt
that's owed to the banks.
It's not real wealth, right?
And also, if everybody tried tosell those houses tomorrow,
that money would evaporateimmediately.
I'm talking about realmillionaires who've actually
built businesses and made tensor hundreds of millions.
Well, we've lost between 11,000and 14,000 of them last year,
right.

(55:34):
And what I was going to say is,like a lot of people think
that's because they're greedyasses.
Actually, an awful lot of them.
They're not that worried abouttheir personal tax situation.
Some of them are, but more ofthem, in my considered opinion,
based on personal experience,the people I know are just so
fed up with not being able toraise any money in London to do
stuff Like you've got a biotechcompany that wants to try and
cure cancer.
You cannot raise money inLondon.

(55:56):
You have to go to Boston, right?
You know you're building asoftware company.
Why is just left last week,armholding's left, you know?
However, long ago, it's as muchto do with that that people are
leaving us to do with, you know, selfish personal tax concerns,
right, and that's really poorlyunderstood.
So I'd ensure that we mitigateall of that.
And and as I said in thattelegraph article, like, my last

(56:19):
line was something like um,yeah, the irony about labor's
policies right now is that theyhave the biggest negative impact
on the poorest in our society,right, and which is precisely
who the labor party is supposedto represent.
Um, and that's just true, likeyou know.
Like rich people leave rich, orrich people are rich enough,
that kind of it's annoying.

(56:39):
They have to pay more tax, oryou know, when pasta is 100
percent more expensive and eggsare 100 percent more expensive,
that's slightly annoying for arich person, it's seriously bad
for a poor person, right, andthat's inflation is what these,
these policies create.
You know, this is all createdby and, to be clear, that was

(56:59):
created by the tories that youknow.
Rishi sunak's eat, help out toeat out.
300 billion quid of nonsense onlockdowns, I mean, like that
that was.
But, but rachel reeves andkirsten were rapidly making it
even worse, like at a very, veryrapid pace.
So, yeah, sorry, there you go.
There's loads more I could say,you know, but I just think that

(57:19):
Britain has so much.
We've got some of the bestscience in the world, we've got
some of the best media in theworld, the best movie stars, the
best writers, the best fashiondesigners, the best software
programmers.
You know I mean.
So in in, in healthcare, inpharmaceuticals, britain has the
best science in the world, butwe lag america in terms of

(57:39):
company formula formation ofvalue creation by trillions of
dollars, not billions of dollars, trillions of dollars, um,
which really annoys me.
And similarly like is it sirjohnny ives, the guy who
designed the iPod and wasinstrumental in designing the
iPad and the iPhone?
He was, like the chief productdesigner at Apple for like 30

(58:00):
years.
British guy, like you know,created two very, very important
for Apple, being a $3 trillioncompany.
A British guy, and it's thesame across, you know, almost
every industry sector and allthe best people leave because
they can't do business in Londonanymore.
Sorry, that was a very long one.

Dr James (58:19):
Andrew for PM.
It started here today on thepodcast and the Dentistry Invest
podcast.
No, but I mean in allseriousness, I mean I don't
really see how it can be a badthing for any, you know, for the
country in any way, if it's ifthey're enabled to, if companies
are unable to raise capital alot easier, I mean how can that

(58:40):
be a bad thing for theindividual or the state or
anybody?

Andrew (58:44):
well, and also, and also , the evidence is there that
generally reducing tax rateincreases the amount of tax the
government has, like in a bigway.
Like I'm telling you, 30billion quid.
I can't remember, I think itwas basically corporation tax.
When corporation tax rate was28 was like 30 billion pounds a
year, and when it was 19 it was60 billion pounds a year.

(59:05):
Right, anybody who doesn'tunderstand that doesn't take
advantage of that is reallystupid, right, because that's 30
billion more quid for the NHSand for pensions and it's like
absolutely insane that wewouldn't do that, right, and you
know, that's why now theBritish government, we're going

(59:25):
to have a bond crisis, becauseif you don't get the money from,
if you have the policies wehave right now, you don't raise
enough money from tax, then youhave to raise money by selling
gilts, by selling bonds, right,and if the global market doesn't
want to buy your bonds, youhave interest rates go up, which
kills everyone, kills mortgages, makes, you know, everybody's
rent and mortgage more expensive, um, makes more companies leave

(59:47):
.
I mean, it's a death spiral, um, and we're.
Our interest rate bill now onUK gilts is something like 100
billion quid a year.
We could get rid of that infour or five years if
corporation tax was at 12% or15%.
Seriously, look at Ireland,look at Singapore.

(01:00:07):
And, by the way, just whilstwe're on this subject, the
pushback you often get aboutthis, which I've dealt with in
other podcasts and I want todeal with again, is ah, but what
about scandinavia?
You know what about norway,sweden and um, and denmark and
finland, right and.
But I used to work for aswedish investment bank, right,
um?
And I've spent an awful lot oftime thinking about and working

(01:00:28):
with thinking about scandinaviaand working with scandinavian
companies and Scandinavianpeople.
And what people fail tounderstand is that's a really,
really bad example of socialismin inverted commas working and
the reason that.
There are a number of reasons,that the main one is because
Scandinavia has unbelievablyhigh per capita resource
endowments.
So basically, they have loadsof raw materials, loads of

(01:00:51):
timber, loads of uranium, ofuranium, zinc, you know all
sorts of stuff, and obviouslyfish was slightly more women we
have that too, but so so you'retaking a huge amount of very
valuable resource.
Norway has all that oil.
I mean, norway's basically gotmore oil than we do because of
our stupid policies.
By the way, we're buying our,our energy back from norway and

(01:01:12):
we've got it.
If we were allowed to get outof the sea like Norway is, we
could just have it ourselves.
But you know, I think thepopulation in Norway is like 7
or 8 million people, so you'vebasically got the same oil
wealth that Britain had over 65million people carried over 7
million people.
All of Norway's electricity isproduced by hydroelectric power,

(01:01:34):
so they basically have freeelectricity for the whole
country, which is obviously verydifferent to us.
And then so Scandinavia canafford a really really big,
expensive welfare state becausethey've got such a huge resource
endowment and plus the factthat Sweden, for example, in the
Second World War was neutral.
So all of the wealthy Swedeshad years where.

(01:01:56):
So at the end of the SecondWorld War, broadly, the
infrastructure in Norway andSweden was not like you know,
that did not look like Berlin orLondon, like right.
They still had their trains,they still had their ports, they
still had their water, so soactually, and at the turn after
the second war, sweden wasbasically one of the very
richest countries in the worldin terms of gdp per capita,

(01:02:18):
because of alfred nobel, thenobel prize, the wallenberg
family, you know, sweden beingone of the earliest countries to
industrialize and have amazing,you know, products and
engineering and car, volvo andall this stuff.
Um, and singapore was about thesame level of wealth as a
sub-Saharan African country, andso was South Korea, and so was
Taiwan.
And then if you look at therespective growth rates of

(01:02:42):
low-tax Singapore and high-taxSweden, in the time since the
low-tax countries haveabsolutely destroyed their
growth rates, right, sweden hasgone from like $10,000 per
capita to $90,000 per capita.
Those countries come from fouror $500 to the same.
So that tells you all you needto know about what the right
policies are.
So, anyway, I get on my highhorse about that, because I'm so

(01:03:04):
fed up of the total failure tounderstand the special case that
is Scandinavia in this debate.

Dr James (01:03:10):
Boom, well, well, listen.
Thank you for sharing all ofthat today on the podcast.
Andrew, you've got a.
You've got your youtube.
That's where you're putting outa lot of content these days.
What's that called?

Andrew (01:03:23):
yeah, so it's plain english finance and andrew craig
.
Basically, if you go, if yousearch that on youtube, you
should find it.
Um, we've just gone.
We went.
We're about 10 100 subscribers.
We went through 10 000 like afew days ago.
Um, and, yeah, I'm doing 12 ishminute long topical videos, um,
which, by the way, are much theyare much less ranty about

(01:03:44):
political stuff, um, and muchmore like educational, about
like, this is how you can do thebest with your finances and for
what it's worth.
Um, there'll definitely be someranty political stuff up there
at some point, but in themeantime, it's it's basically a
free course in effectivefinancial literacy for people,
and there are now, I think, 41or 42 videos on there.
Going through, you knoweverything we've talked about

(01:04:05):
and lots more.
So, yeah, check that out please, because, um, it's free and
people seem to like it and weneed to grow it and I mean, look
, we need to get several millionmore british people to
understand this stuff, and thenbritain would be a much better
place across the piece.
So that's my crusade.