Robin Wigglesworth: The Boring Market That Actually Runs the World SB1901

In April 2025, the bond market did something the stock market couldn't: it made a sitting president reverse course within days. Financial Times journalist Robin Wigglesworth, author of the new book A Fabulous Debt, joins Joe and OG to explain why bonds, dismissed for centuries as the dull corner of finance, are actually the bedrock everything else sits on. From a murdered medieval ruler in Venice to a Scottish con man who sold bonds for a country that didn't exist to the hedge fund collapse that nearly took down the global financial system, this is 900 years of history explaining exactly why the "boring" market is the one that actually moves empires. What You'll Walk Away With Why the bond market, not the stock market, is what actually forced a change of course during 2025's "Liberation Day" tariff chaosThe surprisingly wild origin story of the very first government bond, issued in 1171 Venice, and how it got its ruler killedHow the Dutch turned Venice's basic invention into a true market, and used it to fund their independence from a much larger empireThe incredible true story of a con man who sold real bonds for a fictional country and lured hundreds of settlers to their deathsWhy Long-Term Capital Management, staffed with Nobel laureates and legendary traders, collapsed almost overnight in 1998The biggest misconception most Americans have about U. S. government debt, and why the reality is more nuanced than the doom headlines suggestWhy the oldest investing mistake in 900 years of financial history is still the simplest one: borrowing too much Why This Matters Now Most people never think about bonds until something breaks, a rate spike, a market scare, a headline about the national debt, and by then it can feel too complicated to catch up on. But bonds quietly determine mortgage rates, corporate borrowing costs, and government policy in ways that touch daily life far more than most people realize. Understanding even the basics of how this market works, and how consistently it has shaped history, turns a vague sense of unease about "the economy" into something you can actually follow and make sense of. From the Basement A Bond-adjacent trivia detour (the James Bond kind, not the financial kind) reveals that Ian Fleming borrowed his spy's name from a real-life ornithologist, proof that even a show about medieval Venetian debt can't resist a pun. Plus, a Wall Street Journal headline on why the job market has quietly flipped in favor of workers without a college degree. Resources Mentioned A Fabulous Debt by Robin Wigglesworth https://www.penguinrandomhouse.com/books/750210/a-fabulous-debt-by-robin-wigglesworth/ — Robin's new book on the 900-year history of bondsTrillions by Robin Wigglesworth https://robinwigglesworth.com — Robin's earlier book on the history of index fundsStacking Benjamins Field Kit https://stackingbenjamins.com/fieldkit — the all-in-one budgeting and net worth tracking tool See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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  Hello?

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  Honey? I'm at the mall now and I found this beautiful leather coat. It's only a thousand. Can I get it?

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  $120.

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  Um, does anybody know whose phone this is?

• 1:51Speaker 04

  Live from your home of adventure, it's The Stacking Benjamin Show. I'm Joe's mom's neighbor, Don, and today, bond. Corporate bond. Treasury bond. Short-term bond. Long-term bond. Bonds have long been the canary in the coal mine when it comes to our future. And today, we explore the long, sordid history of the bond. In our headline segment, there's a new trend for job seekers. College grads, for once, don't have a leg up. What's going on? We'll share the data. Nearly as well as I'll share today's trivia question. You seriously don't want to miss this one.

• 2:33Speaker 04

  And now, two guys who love their financial planning shaken, not stirred. It's Joe and OJ.

• 2:45Speaker 05

  Hey there, stackers. Welcome to a special Wednesday episode. That's right, you heard it. We normally don't talk bonds. We shy away from bonds. Today, we're going to talk about bonds and over the life of the financial world. How bonds have been kind of the canary in the coal mine when it comes to looking at your finances. But the guy that's the canary in this coal mine that's across the card table from me, Mr. OG's here. How are you, man?

• 3:15Speaker 06

  I'm great, thank you. Cool stuff.

• 3:19Speaker 05

  It is interesting that while neither you nor I think investing in bonds generally is a phenomenal idea for most people, you can still look over time, though, at the economic conditions of world economy, OG, and get a read if you kind of can read the bond market. And I think that's a good skill to have.

• 3:40Speaker 06

  I mean, if the month-to-month, year-to-year economies mattered in the long run, then sure. I don't believe that they do, but I'm happy to learn more today.

• 3:51Speaker 05

  I was going to say, you're about to hear some stories about when they did matter in history. We're going to go back to a long, long, long time ago history in Venice and the creation of the bond. We're going to talk about Napoleon and the bond. We'll talk about the Dutch tulip market and the bond.

• 4:10Speaker 06

  James and the Bond.

• 4:13Speaker 05

  James and the Bond. We're going to go also.

• 4:15Speaker 06

  Skyfall, skyfall.

• 4:18Speaker 05

  Maybe the best Bond movie. Might be the best Bond.

• 4:21Speaker 06

  Pretty good. Doug just took a trip. I'm surprised I didn't see a picture of Doug with that scene where he's parked the car. And no, the car's parked and the horizon is that Scottish.

• 4:33Speaker 05

  Beautiful.

• 4:34Speaker 06

  There's a place that you can do that at.

• 4:36Speaker 04

  I've been there. I just not on this most recent trip.

• 4:39Speaker 05

  Did you do the picture, though, when you were there?

• 4:41Speaker 04

  No, because I've actually never seen.

• 4:42Speaker 06

  He didn't know it was a picture to be taken. It was like in the 1940s or whenever he was there.

• 4:47Speaker 05

  No idea.

• 4:48Speaker 04

  Okay, all right. Yeah, they didn't have any cameras yet.

• 4:51Speaker 05

  We are going to learn about bonds and bonds in the economy. By the way, we're going to go forward into recent days and what bond markets look like as well. With Robin Wigglesworth. Robin's the editor of the Financial Times Finance Blog, Alpha Ville. He's the author of Trillions. When he was talking about trillions, guys, he was here telling you and I about ETFs and how ETFs were created. And a lot of people think Jack Bogle, the iconic founder of Vanguard, about how a lot of people think he was one of the people responsible for the exchange traded fund or the index fund. Not true. 100% not true. Robin kind of laid a mine for a lot of people. Like, wow, I didn't know the real history.

• 5:36Speaker 05

  When it comes to bonds, a lot of us don't know the history. Maybe the best person who knows this type of history, Robin Wigglesworth, going to be today's Wednesday mentor. Before we get to Robin, though, as he's on his way down to the basement right now, we have a couple sponsors who help us keep on making this podcast free for all of you every Monday, Wednesday, Friday. We're going to hear from those sponsors. And then, Robin Wigglesworth joins us in Mom's Basement to talk about debt and financial planning over the life of the financial world. Love this note from stacker Lisa, who said,

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• 8:54Speaker 05

  And I'm super happy he's on his way back to mom's basement. Robin Wigglesworth joins us again. How are you, man?

• 9:00Speaker 07

  I'm great. It's well, it's raining here, unfortunately, but it's finally summer, temperature wise.

• 9:06Speaker 05

  It is wild how your half of the basement is totally different than my half of the basement. It is so strange how that happens with our guest.

• 9:14Speaker 07

  Yeah, it's almost as if we're on different sides of the Atlantic.

• 9:16Speaker 05

  It's so, so weird how that happens. Robin, most people hear the word bond and they think either James Bond, or they think about that boring thing in their retirement account. But your new book opens with something completely different. It opens with this moment where the bond market effectively stares down the President of the United States. So why don't we start where you started? It's April 9th, 2025, a day that President Trump is called Liberation Day. What happened that really I think sets the stage for how important bonds are in our lives?

• 9:52Speaker 07

  No, it was such a powerful moment and then President Trump is not the first person to have been cajoled, bullied into submission by the bond market, but and he won't be the last either. So he had announced these large swinging tariffs of every country around the world. The methodology was a little bit shaky, shall we say? And the stock market had reacted extremely violently. The stock market actually started selling off even before Liberation Day because we knew something bad was coming down the pike, essentially. It was interesting that the stock market kept falling and falling and falling, even at one point hitting what we think of a beer market, a 20% drop from its high. And Donald Trump was still always saying, no, keep on, stay the course, you know?

• 10:37Speaker 07

  I'm not scared. I don't care.

• 10:38Speaker 05

  Yeah, it didn't dissuade him at all.

• 10:40Speaker 07

  No, until the bond market literally only had a few days of violent sell off. And they very quickly hit pause and say, look, oh, we're going to give countries time to negotiate. And they said it was a negotiation ploy and maybe, but in reality, it just shows that, you know, the stock market dropped 20%. And look, it's not great if you look at your retirement account. But when the bond market starts quaking, terrible, terrible things can happen because this is kind of the bedrock upon which the entire global financial system rests and especially the US Treasury market. So that's why it was such a powerful moment. It just kind of reminded us once again that the real action finance is not the stock market.

• 11:24Speaker 07

  It's fun and exciting and racing glamorous and bonds are kind of designed to be boring. It's the boring part of your retirement account, but the boring bit blows up. It's very, very scary.

• 11:35Speaker 05

  Let's kind of pull that apart, Robin, because our stackers don't really understand how the bond market works. I would guess, but I'd say over half of them don't understand how it works. Certainly it took me a lot longer to understand the basics of the bond market than it did the stock market. It's much less transparent. Why were bond traders so alarmed by Liberation Day?

• 11:58Speaker 07

  Well, I think it's important to remember that the bond market is very complicated. A colleague of mine recently wrote a piece that argued that if you think you know how the bond market works, then you don't. I've spent most of my life as a financial journalist, which is, you know, 20 years now plus in the fixed income side of things, as bonds are often called as well. And even I am constantly amazed and humbled by how much new things there are to learn.

• 12:22Speaker 05

  I hear this, by the way, Robin, with all the experts I know in silver say the same thing.

• 12:26Speaker 07

  Yeah.

• 12:27Speaker 05

  You think you understand where silver's going until you don't, until it surprises you again.

• 12:31Speaker 07

  Exactly. It smacks you in the face. I mean, I think with a lot of things, the more you learn about something, the more you realize how little you actually know. So the most confident people are the ones who have maybe skimmed a Wikipedia page. And after that, you know, it's all downhill sadly. So the bond market reacted so badly for all sorts of reasons. Part of it was inflation. That was probably the start of it. But in reality, it's just the fact that the bond market has these vastly huge, quite sophisticated, quite smart participants, hedge funds, central banks, insurance companies. And there were lots of these quite leveraged trades and then they'd used financial derivatives and borrowed money to do lots of, dare I say, fairly aggressive trades in the Treasury market

• 13:17Speaker 07

  in particular, because they do this on the expectation that treasuries are safe, they're solid. Even a bad day for treasuries and it moves a percent of a percent. And then suddenly it wasn't moving a percent of percent. So you could say the sell off that started with Liberation Day escalated like a snowball, eventually causing an avalanche in the Treasury market. And because the Treasury market is, I call it the mightiest market the world has ever known, because it is the bedrock for everything, everything that we price, everything from money, whether it's a mortgage in Germany, a corporate loan in Chile. Essentially, everybody's kind of competing with the US Treasury for money. So essentially what happens in the Treasury market, like Las Vegas, does not stay there.

• 14:01Speaker 07

  And that's why it's one of those things that can just very quickly escalate. Liberation Day caused a sell off in the bond market because of fears about inflation. That then snowballed into an avalanche because of lots of leveraged trading by big hedge funds in particular. And then eventually it got to the point where it kind of is a self fulfilling prophecy and it's selling off because it's selling off and people are worried. And that's why it was so important that Trump very quickly then, on the advisement of Scott Bessent, his Treasury Secretary, came out and said, actually, look, we're going to put a pause on this. And it was very explicitly because of the bond market. Trump came out afterward and said it was because he felt the bond market was getting a bit yippy, as he put it.

• 14:41Speaker 05

  Yippy.

• 14:42Speaker 07

  Yippy. Yeah. You don't want the bond market yippy.

• 14:45Speaker 05

  No, you don't. I mean, and I'm glad they kept a technical for us too.

• 14:48Speaker 07

  Yeah.

• 14:48Speaker 05

  Speaking of technical, just how the bond market works, can we just talk about the lever? So these bonds, you talk about a market, bonds are sold in a market. They have what's called a par value. I guess what you're saying is I'm holding on to a bond, which is essentially a loan. If I hold on to that bond till maturity, I'll be repaid. But in the bond market, I will sell those loans. If I think maybe I'm not going to be repaid or if my use of a dollar is better spent someplace else. So taking that framework and applying it to the Treasury market.

• 15:28Speaker 05

  If it's a Treasury market and yields are going up, that means nobody wants to buy treasuries.

• 15:35Speaker 07

  Essentially, yes. There's always a price for treasuries and I hope in our lifetimes there always will be. But even small changes can have massive ripple effects in the market like that. So it's exactly right. A bond is just a tradable loan and it has a fixed interest rate that it pays. It's almost the definition of bonds is that it's a fixed interest rate loan that trades. Some trade a lot, like in treasuries, hundreds of billions of dollars worth of treasuries trade all the time. And then certainly if it's a junk bond issued by a small utility company in the Midwest, it might only trade once a week, a month, maybe even not even that. But essentially if then you can imagine the price, if you buy a bond that pays 5% a year at par value, you can get 5%.

• 16:20Speaker 07

  But if you buy that bond at like 110 cents on the dollar, because interest rates have gone down and that bond looks really good, then actually the interest rate you collect in practice is lower versus the price. This is why prices and yields move inversely. It's like a seesaw essentially. So when you hear about bond yields shooting up, well, that's bad. That means the prices are going down and vice versa. If, for example, interest rates are heading down in the United States, maybe sadly because of a recession or whatever, then that means that the price of bonds are going up. People are seeking out that extra safety. And bonds can sell off for good reasons. Like, I mean, in theory, if like the US had incredible economic boom, that should, all things being equal, mean that you don't want to keep your money in boring treasuries.

• 17:04Speaker 07

  You want to put it in the stock market. So treasuries can sell off for good reasons. But when they sell off for bad reasons, it's very scary. As many countries over the years have noticed, albeit not a country like the United States. This was one of the first times we saw something like that happen there.

• 17:20Speaker 05

  It's interesting. When I started looking at it from the point of view of the borrower, that helped me with the seesaw, Robin, just thinking about if I'm a company and I need money and I go to the bond market, I say, hey, what's the lowest interest rate I can get? And if nobody will give me that interest rate, then I got to offer more, then I got to offer more, then I got to offer more. So companies don't want to pay eight, nine, 10%. They pay that amount because they have to. So when bond yields spike, the bond market's really saying, we don't believe in you.

• 17:48Speaker 07

  Yeah. Essentially it was exacerbated by, you know, what analysts will call technical factors. And it really was. So although I think that the US government's handling of that situation was incoherent and chaotic, it wasn't just the Trump administration's fault. These were other things going on, but it shows that how this market, look, the stock market globally is around $130 trillion, which is a lot. As $130 trillion engorge on AI excitement and all that jazz. The bond market is probably closer to $200 trillion. I sometimes call it, it's like the dark matter of finance and economics. You don't see it, but it binds everything together. And there are racier parts of the bond market.

• 18:33Speaker 07

  There are junk bonds, there's structured products and, you know, some of the mortgage backed bonds we saw in 2008 can go kaboom. But broadly speaking, it's built for safety and solidity. And when that doesn't happen, especially in a place like the treasury market, which is kind of the bunker that we all seek shelter for when the financial storms are raging, when the shelter itself is starting to creep, you get scared.

• 18:56Speaker 05

  You mentioned earlier that President Trump wasn't the first leader who had to yield to the bond market. So the natural question is, how far back does the story goes? Turns out, Robin, this story goes back a long, long, long, lots of people yielding to the bond market. Let's go to 1100 in Venice. Why is the year 1171 in Venice such an important year?

• 19:19Speaker 07

  Well, it's the birth of the very first bond, though I don't think they called it that. Well, I know they didn't call it that, not for a while. And Venice is just a fascinating city. I mean, obviously it's incredibly beautiful, you know what it is now, but it's so unique in the history of the world because it was a rear republic and almost like a seal of middle age autocracy in Europe at the time. It was nominally ruled by Constantinople, but kind of thumbed its nose at Constantinople all the time. It technically also owed religious fealty to the Pope in Rome, but also Venetians were so relentlessly mercantile, they'd trade with everybody. Like they would trade with the Invidal Muslims, they'd trade with, you know, everybody around the world, they just didn't care. So nobody really liked them.

• 20:02Speaker 07

  They were such good merchants, such good financiers really, that it became the wealthiest city in the world. It was the commercial center of the world. But in 1171, essentially Constantinople got a little bit upset with this uppity vassal in theory, and essentially just confiscated all the property of Venetian merchants in the city under a slight pretext.

• 20:25Speaker 05

  Just put their foot down.

• 20:27Speaker 07

  Yeah, exactly. You know, teach these guys a lesson, essentially, you know, who the hell do they think they are? And they arrested all the Venetians. It was incredibly daring raid. I mean, the planning, the orchestration of it in like 12th century must have been incredible. They arrested so many Venetians, they had no space in the prisons. They had to put them in like cloisters and maus-lyms, just for overspill reasons. And the Venetians decided, okay, well, look, we're not going to take this anymore. We're going to put Constantinople in their place. The thing is, cities then didn't like have regular taxes or big standing armies and governments. So they needed to raise the money. And Venice was very wealthy, but its citizens were wealthy. So the Doge, Doge Michel, he decided that they were going to basically impose a tax

• 21:13Speaker 07

  on its citizens, prorata, according to their wealth. They had a census and everybody would have to pay. But this tax would actually pay a 5% interest between when the money was raised and when Venice would pay back the money.

• 21:27Speaker 05

  So they're not just taking your money, they're telling you, we're going to give you some money for the money that we took.

• 21:32Speaker 07

  It's essentially borrowing, yeah.

• 21:33Speaker 05

  Yeah, gotcha. And the Doge is their leader.

• 21:36Speaker 07

  Yes, he's the elected head of the government. You know, they took that role quite seriously. There were lots of rules around how you could act and what you were allowed to do. And Doge Michel was very cautious. He was a cautious merchant essentially. So he wasn't actually that keen on going to war with Constantinople because it was bad for business, but people were so angry, he felt kind of, he had to go through with it.

• 22:00Speaker 05

  This is kind of the first government bond, Robin.

• 22:02Speaker 07

  Yep, it is. I mean, it's a city at the time. So some people will argue other things that came from the UK, yeah. But I think this is the OG bond. This is the genesis moment that I was always looking for. And, you know, as we talked about, like, Trump isn't the first government leader to discover the power of the bond market. Well, Doge Michel was murdered by his own citizens for his efforts.

• 22:23Speaker 05

  Why?

• 22:25Speaker 07

  Well, they raised this money, paying 5% a year, twice a year the payments were made. They built a magnificent fleet. The Venetians were very good at building ships and they waged war on Constantinople. But Doge Michel led the expedition himself. He was very careful, very cautious. And the Constantinople Emperor, Emmanuel, he played a waiting game. He knew that at some point they might get bored. So he kept pretending they was going to negotiate and negotiate and negotiate. And in the end, Doge Michel's fleet was hit by the plague, or a plague, we don't know exactly which one, but like it was devastated by the disease. They had to limp back to Venice and they brought the plague with them.

• 23:06Speaker 07

  Not only has he borrowed lots of money from all the wealthiest people and the poorer people of his city and wasted that money on this expedition that then was a failure, he brought disease and pestilence back with them. So they had a public meeting to discuss this debacle, a bit like a senate hearing, I guess. And people got so erate that first his advisors started tipping out towards the exits. And then eventually the Doge himself tried to flee, but was caught on the streets of Venice and clubbed and stabbed to death.

• 23:36Speaker 05

  The big question in my mind, I mean, it's a horrible loss of life and it's far worse than like firing your football coach when he doesn't win the game. But did investors ever get their money back?

• 23:45Speaker 07

  Well, no, but that actually proved to be the brilliant part of this, that because Venice had lost this war, they weren't immediately able to repay the loans, but they kept paying the 5% interest. That was secured from royalties, from, they had various of toll roads and customs duties and things like that. So they could still pay the 5% very easily. And they made the receipts of the loans tradable. So if you're a merchant who had lent a lot of money to the Venetian government for this expedition and you needed cash, cold hard cash, you could just take this receipt down to the Rialto, which is the big market at the center of Venice and get cold hard silver for it, for example.

• 24:27Speaker 07

  And as people kind of basically still trusted Venice to be good for the credit, these pieces of paper basically became like money. You could use it to endow a monastery, you could use it to extend trade credit. It just became incredibly powerful. You had pieces of paper that were bearer bonds, or there wasn't bearer bonds then, but like you'd carry them around and you'd register the name if you sold it to somebody else or register the new owner. It just became an incredibly powerful financial technology. And so actually other city-states saw this and they weren't allowed to buy Venetian bonds, only Venetians were allowed to do so. It became a privilege. You'd be granted citizenship purely so you could buy some Venetian bonds because it's

• 25:11Speaker 07

  a great way of having your wealth. So Florence copied it, Genoa, Pisa, all the Italian city-states that were kind of the center of the commerce in the world at the time, they all copied it and eventually it spread everywhere.

• 25:23Speaker 05

  And these are bond markets, literally people standing in a square, trading these notes back and forth.

• 25:29Speaker 07

  Yep, on little bankey, which is where the word banks come from as well, the little wooden tables. They do both money changing and lending and buying and selling bonds. So the first bond market was a bunch of dudes essentially sitting by wooden tables at the Compaia Rialto in Venice. It's the, the original Bloomberg terminal, if you will.

• 25:48Speaker 05

  It also struck me, Robin, that the Venetians used this to fund their military. This is replicated throughout history. Like as I'm reading the rest of your work, like government after government after government uses the power of bonds to essentially to go to war.

• 26:06Speaker 07

  Well, I called my book A Fabulous Debt after a famous book by a British thinker in 19th century commented on exactly that. He made the observation, as other people before and afterwards did as well, including Alexander Hamilton in the United States, that the countries that managed to harness the power of the bond market to pool vast sums of individually small pieces of money into one big unified market were generally countries that thrived and countries that didn't do that generally struggled. So for example, the Netherlands fought for independence over a century against the hyperpower of the era, the Spanish Empire. And the reason why they were able to do it is because nobody copied and adapted and

• 26:49Speaker 07

  improved on the bond market that the Venetians had invented with more skill than the Dutch. The Dutch were kind of the first that created a true, proper decentralized bond market. So cities, towns, waterworks, provinces would issue lots. And it kind of became, the gilde became the world's first reserve currency because of that. The UK then literally basically copied and pasted it. They basically imported their Dutch prints, lots of Dutch financial innovations into the United Kingdom with the Glorious Revolution of 1688. And it was one of the reasons why the UK was able to build an empire and fight so many wars was because of this awesome power that the British console market gave them. Alexander Hamilton saw this when he was a young artillery captain.

• 27:34Speaker 07

  We have letters, he'd write to people saying, look, the real might of Great Britain is not in its redcoats or in its guns, it's actually in its bond market. It is the fuel that keeps armies going. We've always known that money is important to fight wars, but the bond market is basically money, it's almost most powerful. So that's why the countries that learnt to harness the bond market ended up doing well.

• 27:57Speaker 05

  Their ability to outlast you, to continue to build when you ran out of funds was the key. I want to pause on a couple of these points that you made because let's go back to the Dutch, because I love this analogy that you wrote. While Venice created the wheel, the Dutch were able to put four wheels together and build a wagon with it. What were some of the innovations that the Dutch brought to the bond market that we still see today?

• 28:21Speaker 07

  Well, primarily setting interest rates vaguely by market prices. So with Venice, because it generally took in the early years, the form of a mandatory tax that paid a fixed interest rate. Venice eventually kind of switched to a slightly more market-based approach as well. But you know, they had a price, they had an interest rate and they sold it, or they forced you to buy it, or eventually they started selling it. But the Dutch realised, well, you could fiddle around with the interest rates. Different countries like Holland, like one of the big provinces was more credit worthy than maybe some of the smaller ones. Or Antwerp was more credit worthy than others. And they were all frankly more credit worthy than the Spanish crown, who defaulted, I think, six times over the course of this hundred year war.

• 29:05Speaker 07

  And the Dutch, you know, essentially were able to do so and then set interest rates to where they always attracted investors. So it wasn't just Dutch burglars saving their money to help the Netherlands fight this war. It was actually savers from the UK, savers from France, savers from the German states as well, would buy Dutch bonds because they were just a great way of saving money. And lo and behold, the Dutch basically used the bond market to pool cross-border amounts of money to fight a vastly larger foe into independence eventually.

• 29:39Speaker 05

  It's interesting because it strikes me that all of these markets are based on trust. And we even opened today with saying that, you know, bond yields go up when somebody says that they don't trust you. How much corruption over the years did you see in bond markets? They must be policed fairly well if we're using bonds as a thermometer of how trustworthy someone is.

• 30:02Speaker 07

  Well, the main thing is that they're debt. So the way that we've organised our legal systems back then and then today is that they credit is rank ahead of shareholders essentially. So if you're a company and you borrow money, well, the equity people, the shareholders, they get wiped out, the bonds is ranked more highly. In the case of countries, like there is no bankruptcy court for countries, but this has become the way that like generally governments can, you know, renege on their liabilities, their legal liabilities. But broadly speaking, it tends to be quite bad because it will hurt their people, their populations even more than anything else. So it happens occasionally, but luckily quite rarely. So it's just become that they are a little bit safer. But as you and I know well, like, you know, it's that famous quote, I never remember

• 30:47Speaker 07

  who said it, but from the crooked timber of mankind, never a straight thing was made. And it's not just the stock market that can get warped by our sense of euphoria and hubris, or for that matter, our fear when things go bad. So the bond market has just as many episodes of madness as the stock market may really. And in many ways, when the bond market does go bad, does get deformed by greed and fear, the consequences are quite often far more severe just because, like I said, its usage, it has become collateral in the financial system for loans and all sorts of other things. So, you know, the stock market can drop 20, 30%, even back in the day. And in the 19th century, that was fairly routine.

• 31:32Speaker 07

  And it doesn't need, it's usually a symptom of a financial crisis. It doesn't cause one. Stock markets very rarely cause financial crisis in isolation, hardly ever really. You have to think of like the South Sea Bubble and things like that. Even that was economically not as a disastrous crisis as one might think. But the bond market, I mean, my God, when the bond market goes bad, that causes financial crisis. And in fact, the first big global financial crisis we had in the 17, 1800s were mostly caused by the bond market, not stocks.

• 32:04Speaker 05

  What happened?

• 32:05Speaker 07

  Well, I think my favourite one is 1825, the panic of 1825, because it is the first global financial crisis, because it hit both parts of Asia, to a little extent, but especially Europe and the United States. People got really excited about bonds. So after the Napoleonic wars, Britain had sold an a godly amount of consols to finance its war. And then it won. And all those consols rocketed up in price because suddenly the UK was, you know, the winner, it was all going to be fine. And that kind of capitalised and encouraged a lot of people thinking, oh my God, you can make so much money in bonds. They'd been buying British consols at 50 pence on the pound, basically at half price. And suddenly it went up to 100. So you doubled your money, it was great. So they started looking for more and more exotic bonds.

• 32:48Speaker 07

  And then people like Nathan Myer Rothschild, the grand patriarch of the Rothschild empire, he started marrying British capital with overseas borrowers. So Prussia was the first one. But then also Italy and Spain, other countries would come to London to borrow money from these newly rich British investors. But like all good things, you know, we take things too far. So this was the early 1810s and then 20s. People got euphoric and people started issuing bonds on behalf of newly independent Latin American countries, so Mexico, Honduras, Brazil, Colombia, Venezuela. Most hilariously, at one point, a British or a Scottish adventurer called Gregor McGregor

• 33:31Speaker 07

  rocked up in London with a title as the prince of, the kazik, he called it, but the prince of Poyet, an incredibly wealthy country in Central America. And he told everybody about it. He had songs sung, he was a toast of town, he went to the royal parties, he issued several bonds in the city of London, raising hundreds of thousands of pounds, which was a fortune at the time. He even enticed 900 settlers to move to this incredible country where gold was abundant and fruit trees were everywhere. Of course, as I can tell from your smile, you know that this was just a big fat scam. He'd invented the whole thing out of cloth. And so he did even like a chivalric code, an inherited nobility, the name of the city,

• 34:16Speaker 07

  that everything he'd invented, he took the money from the bonds and buggered off to France. And these poor settlers landed not on this mythical golden country, but something called the mosquito coast, which is as unpleasant as you can imagine. Most of them passed away.

• 34:31Speaker 05

  They got its name for a reason, probably.

• 34:33Speaker 07

  Yeah, I think only 30 of them made it back to the UK.

• 34:35Speaker 05

  Oh no.

• 34:36Speaker 07

  Yeah, it was, I think it's, you know, they say the only difference between tragedy and, and, you know, humour is, is time. And I think we can probably laugh at this now because it was so bad, but you know, people died from this scam. But still this bubble kept kind of inflating. It shows like sometimes bubbles, even when people are obviously doing silly things, they can continue. Until the Bank of England, there were lots of things that happened in the UK, they tightened interest rates essentially, they tightened monetary policy. That this is before the Bank of England was a proper central bank, it was just the biggest commercial bank. And that basically caused ripple effects across banks. Everybody had used these bonds from Latin America as collateral for other loans and the whole thing started collapsing. I mean, in reality, these countries, they weren't really countries yet.

• 35:21Speaker 07

  Like they were, they're ideas on paper that then turned up to London to raise money and people are willing to give it to them, but they didn't have like treasuries, they didn't have tax collectors, they didn't have, like, maybe they might have like some soldiers, but you know, this was very early. So almost every country in Latin America also defaulted. I think the only one of those that issued was Brazil. Also coincidentally, the only bond that basically the Rothschild family kind of avoided the Latin American bond market, they thought it was a bit unsavoury, they thought people might regret it, so they were quite prescient in that respect.

• 35:52Speaker 05

  Wow. It is so fascinating to see how the bond market creates these winners and losers. And what also strikes me, the relationship here between this discussion and the last time you and I spoke, which was the evolution of the exchange traded fund, because it seems to me, just going back to the Dutch and even then looking at, you know, this area might have been a better risk than this other area might be. Is this where we start to see, Robin, the earliest versions of diversification and broad markets, like an individual investor goes, I'm going to loan some money to Holland, but not all my money, I'm going to spread it out?

• 36:28Speaker 07

  Well, as it happens, the very first fund, investment fund, and it wasn't exchange traded, because there were exchanges, but nothing like today, was literally a big fat metal chest that a Dutch merchant bought with three locks. And he bought a collection of different bonds from around the world. There were plantation bonds from the Caribbean. There were bonds backed by toll roads in Denmark and Sweden. There were British consols. There were Dutch gildebonds there. Put them into a chest, locked it, and the idea was investors weren't supposed to open it for another 30 years, essentially. But the whole point was that individually, each of those bonds could go bust. He invented, came up with this idea soon after a small financial crisis

• 37:09Speaker 07

  in the Netherlands. But the idea was that diversification, like in a fund, if you have enough stuff there together, and of course, the chest with three locks was to make sure that nobody could run off with a physical pieces of paper, because by then, we did have bearer bonds. So anybody who held it owned it, essentially.

• 37:26Speaker 05

  Easy to be a long-term hold, right?

• 37:29Speaker 07

  Yes.

• 37:30Speaker 05

  Instead of a trader with three locks on there.

• 37:32Speaker 07

  I've sometimes wanted to put a physical lock on my trading account, you know, it's a lot easier.

• 37:37Speaker 05

  We talked about the dumbest thing, maybe, that humanity ever financed with borrowed money, putting money into a nation that doesn't exist and buying those bonds. We talked about wars, which, you know, sometimes, in the case of Venice, you know, not something that the Doge wanted to do. In the case of the Dutch, something honorable, trying to get their independence from the Spanish. So a very noble pursuit. What are some of the coolest things, though, humanity's ever financed with borrowed money?

• 38:07Speaker 07

  I mean, I hate to be flippant, but if you literally just look around you, you'll see, certainly, sitting in America, most things. In reality, the US is the center of the global bond market, because banks were under all sorts of controls from long parts of American history, but the bond market was allowed to grow free. You know, here in Europe, we're still mostly dependent on banks. That's changing. In the US, it's literally like Tesla's cars, Netflix's content, the medicines that we use, the hospitals, your mortgage almost certainly is in a bond. Bonds basically have taken over almost all of the heavy lifting from banks over the past century, especially. And America being sort of ground zero of this, this huge

• 38:52Speaker 07

  secular shift, bond markets have kind of gobbled up everything. So whether it's good or bad, so tobacco plantations, wars, but also medicines, hospitals, the show that you watch on Netflix. Netflix doesn't finance these things with like necessarily just the subscriptions we pay. They pay for the bond, but they issue debt to do these things. It's how almost all big companies do now. If you look at an IBM, a Google, you know, these are companies that are now issuing hundreds of billions of dollars' worth of bonds to build data centers. So like the AI boom that we're living in today, that is fueled largely by bonds.

• 39:32Speaker 05

  I'm so fascinated by history and about the beginning of bonds. I definitely wanted to go from President Trump back there. But let's go to some of the near-term bumps in the road. Well, I think we got time for one. I'd like to talk about a company that a lot of people will remember, Long Term Capital Management, that was the hottest thing, Robin, until it wasn't.

• 39:53Speaker 07

  So hot.

• 39:53Speaker 05

  Blew up so, so, so quickly. Do you mind telling the story of Long Term Capital Management, or at least at a bridge version? I don't think we can go into it as much as we can in your book. But Long Term Capital Management, why did it succeed? And ultimately, how did that balloon pop? And how were bonds involved?

• 40:10Speaker 07

  Well, so LTCM was not just a hot hedge fund. It was the hottest of the hottest hedge funds, because it was started by the fabled bond trading department of the Solomon Brothers, led by a guy called John Meriwether, who is a legendary trader. So if you've ever read Liar's Poker, the guy that bluffs the CEO of Solomon to $1 million bet on Liar's Poker, that's John Meriwether, possibly one of the greatest bond traders who has ever lived. And with LTCM, he was gathering the whole crew. It was like the Avengers assemble of bonds. And he also married it with some of the smartest, hottest finance professors in the world, people that had or were going to win Nobel prizes in economics. So there,

• 40:55Speaker 07

  it was just a complete magical confluence of the smartest people in finance, and they were going to do stuff in the bond market.

• 41:03Speaker 05

  Yeah. Why would you bet against them? Well, I would think, being a hedge fund, if I was investing my money, like, why would I not give my money to them?

• 41:11Speaker 07

  Some people were a little bit scared to begin with, but after a while, yes, I mean, people were throwing money at them. Banks were desperate to do business with them, just to catch a bit of the reflected glory, maybe learn a little bit from what they were doing. Like, if we put trades on for you, maybe we'll learn a little bit from you guys. Like, everybody wanted to work with them. And in fact, they were so successful right out of the gate in 94, quite quickly, they actually started returning some money to investors. They were like, yeah, we have enough. We don't need all, we have our own money as well, because we're very wealthy now. So we're going to trade mostly with our own money.

• 41:40Speaker 05

  It's quite a flex.

• 41:41Speaker 07

  No, a huge flex. They hugely regretted it afterwards, though. And they got into other things in the stock market, but they were at their heart, a fixed income or bond investment shop. They arbitrage differences between different bonds. So they weren't looking at like, oh, I think treasuries are cheap, so I'm going to go super long treasuries. They didn't do those kind of things. Occasionally, they might a little bit, but they looked at two different bonds that were basically exactly the same bond, but one was cheaper and more expensive than the other. And they went short the expensive one and long the cheap one, essentially. They bought one and sold the other. And ideally, they'd converge. And they did this with like gargantuan amounts of leverage, debt borrowed from banks or

• 42:23Speaker 07

  through financial derivatives. So although they only managed, I think, like eight billion at one point, that supported $200 billion worth of assets at the time, when like $200 billion is real money today. But back then, it was just monstrously big.

• 42:39Speaker 05

  It's the leverage that gives him so much control.

• 42:42Speaker 07

  Yes. This is why, like, let's say, if I buy a stock on margin, if I go to my broker, he's not going to give me more than like half the value of stock. Maybe if I'm buying Google, he'll lend me half the money. I don't know. But if you're buying treasuries, the most unimpeachable money good asset on the planet, you're going to be able to borrow a lot against that. So actually, what you can do, and this faithfully was where John Meriwether worked, when he first joined Solomon, he worked at something called the repo department, which is essentially where the bond market itself borrows. But he learnt how to use leverage, use repo, which is a form of leverage, to maximize these bets. So he might have one of these bond trades that maybe only makes you like a percent a year, but if he leveraged

• 43:24Speaker 07

  that 20 times, I borrow billions of dollars on top of that. Well, actually, that becomes, let's say, 20% a year or 30% a year. And suddenly, you can have very safe bets with lots of leverage, and together, that makes an incredibly profitable machine. And those things work incredibly well until they suddenly don't.

• 43:45Speaker 05

  But how did it not? I mean, how does the Treasury Department all of a sudden turn around and you're upside down?

• 43:52Speaker 07

  Yeah. Well, it was a series of things, but a classic example of what can go wrong in markets is that everybody started copying them. That in an economic model, if you're a scientist, you can run lots of different experiments with something and find your way to something. And if you run 100 experiments, they all show the same thing. Well, then, pretty much solid, right? That's, you know, you've proved your hypothesis. But in finance, of course, you're actually affecting what you're testing it on. It's a dynamic market. People are responding to you. And because Long Term Capital Management was doing so well, everybody started copying them. Everybody put on the same trade. And we don't know exactly what caused the first bleed. Not the killer blow, but the first bleed probably

• 44:37Speaker 07

  was ironically, Solomon Brothers itself, the mothership where they'd worked before. So Solomon Brothers had basically tried to replicate everything its old traders had done. But then it got bought by travelers and became Citi today. And the new guy, Sandy Whale, did not like all these bond market shenanigans, who basically forced that department start cutting its position. But that means selling stuff. So it meant that everybody who had those same positions got hurt. And then they had to sell. And then they had to sell. And it just starts escalating like a classic snowball.

• 45:08Speaker 05

  And then because you have so much leverage, now you have capital calls and...

• 45:11Speaker 07

  Exactly. So the crazy thing about LTCM, they were aware of this danger to a certain extent. So they actually had very strong agreements with banks, so very limited margin calls, but some. And that's how it starts, it starts bleeding. It's definitely getting worse and worse over the weeks leading up to the default of Russia. So Russia in 1998 defaults on its bonds, on all its debts. And this was considered unthinkable, because the cliche at the time were that nuclear powers don't default, as if it was some sort of magic incantation. Of course, it wasn't true. Russia did default.

• 45:45Speaker 05

  It's like real estate in 2007.

• 45:47Speaker 07

  Yes, exactly. Yeah. Real estate doesn't go down nationwide until obviously it does. Well, so Russia essentially then delivered the killer blow. It kind of worsened all these trends. So LTCM was just desperately hanging on to the ledge, as it were. And then the Russian default comes and stomps on its fingers, and it just collapses. And it is so big, and it's so interwoven, there's so many different banks around the world that are linked to it, that the government feels it has to orchestrate, basically bail out. So all the big Wall Street banks get together and basically dismember LTCM.

• 46:20Speaker 05

  It's amazing, just thinking back to the beginning of our discussion, Robin, and how bonds allow these governments, these cities, these companies to get leverage. And taking out leverage to buy these things, they're giving other people leverage, creates this crumbling ship. And not hundreds of years ago, or 1,000 years ago, but just a few years ago, and still could be happening today right underneath our feet. Well, we saw with President Trump last year.

• 46:52Speaker 07

  Yeah.

• 46:52Speaker 05

  I have a very quick lightning round I'd like to do before we say goodbye, because I'm wondering about a few things. All right, Robin, speed round. After studying 900 years of debt, what surprised you the most?

• 47:05Speaker 07

  How sophisticated they were hundreds of years ago.

• 47:07Speaker 05

  Yeah, even the Venetians.

• 47:09Speaker 07

  Yeah, yeah, yeah. The Dutch had beer raised, they had options, they had derivatives. They weren't nearly as complicated or as big as we have it today. Everything moved slower. It was word of mouth and hands. But like finance, when you turn back the clock, it's surprisingly sophisticated quite early on. And in fact, what we think of as capitalism or financial capitalism today was for a long time just called Dutch finance. So the way that, you know, young people will talk about capitalism, you know, peak capitalism, if you read like Disraeli and William Gladstone in the UK in the 19th century, they talk in majority terms about Dutch finance as a sort of shorthand for funky stuff in finance. But there were like quite a lot of funky things. I quite like that. It's, you know, when we study history, some of it's just for the delight and the fun of it.

• 47:53Speaker 07

  But it is also relevant because it's important to remember that I once wanted to do a podcast on financial history that I wanted to call, This Has All Happened Before.

• 48:02Speaker 05

  Yeah, right, right.

• 48:03Speaker 07

  And I think that's true, and we can learn from that. We quite often forget those lessons, but we can try.

• 48:08Speaker 05

  But that's actually my next question. We keep repeating these mistakes. What's the oldest investing mistake that you see us keep repeating?

• 48:16Speaker 07

  I mean, borrowing too much. I mean, I wish I could be so pithy and smart and something more cunning than that, but it's just we borrow too much. I mean, the bond is a good example. But I call it sort of one of the original financial technologies, probably most powerful financial technology we have. But like all technologies, if we do it too much, we do it badly. And the bond has allowed us to borrow money more efficiently than ever before. But as we've seen for thousands of years now, with debt in general, we overdo it. We don't know when enough is enough.

• 48:47Speaker 05

  What's the biggest misconception people have about US government debt?

• 48:51Speaker 07

  I'd say that the US government is bankrupt and going down the drain and, you know, is on the precipice of disaster. I was worried in April 2025. I was very worried in March 2020. But there's a difference between the kind of, the bond market is a vastly complex organism where terrible things can accidentally happen, and the, oh, the US is running out of money, essentially. And the US has a huge government debt burden, and I would like it to be lower. And I think it should ideally be lower. But I think a lot of the fear mongering around the sustainability of American debt is overblown. I think, almost unfortunately, the US can probably

• 49:34Speaker 07

  borrow twice as much money as it already has. And I'm not saying it will be pleasant or that it's good, but I don't think it's necessarily a disaster. I think people forget that one person's liability is another person's asset. And it's almost a mirror reflection of America getting richer. Like, it is the largest, most powerful, richest country in the world. The bond market is a large component of that. So that, I think, is the biggest misconception, at least here from Americans.

• 50:01Speaker 05

  We talk about getting over leveraged, and your point just then is, we can loan more money to the US government, and you think we'll, we'll probably be fine. What historical figure in this study would you never loan 20 bucks to because you're fairly certain you won't get it back?

• 50:19Speaker 07

  Oh, wow. That's a great question. Apart from Gregor McGregor, I mean, I love the guy. I mean, I just, I love a colorful rascal, right? And he's just incredible. I mean, tragic consequences aside, like the panache you need to basically rock up, pretending you're a prince of an imaginary Central American country, be the toast of the town, and then bugger off to France with all the money you've borrowed. I mean, that's incredible.

• 50:42Speaker 05

  I was surprised how little the bond market believed in Napoleon.

• 50:45Speaker 07

  Yes. Well, the French did not have a very good bond market, and that predates Napoleon. When I was reading the history, I didn't spend that much time discussing France, except occasionally. But it is interesting how many times they had a market, and the king essentially blew it up by, again, borrowing too much, or cutting the heads of creditors, or whatever, right? It's just, it's just one of those things that you need a bond market, you need to respect it, but you need to nurture it and not kill it. And I think the Brits were very good about letting it grow monstrously big. I mean, the UK debts after Napoleonic wars and after World War II were far larger than they are today. But you need to kind of keep things going. But who I wouldn't lend 20 bucks to, I mean, I love all my characters like I love my own

• 51:26Speaker 07

  children, really. So it's hard to say. I would have to say, I mean, Gregor McGregor. Yeah, I love the guy, but I'd have a drink with him, not lend him money.

• 51:35Speaker 05

  That's fabulous. Oh, this new project is so fun. It's a fabulous debt. The epic story of how bonds built the modern world. And for most of us stackers that don't understand the financial bedrock that everything is built on, this is fantastic. And it will be out next week, everywhere?

• 51:54Speaker 07

  Yes. I mean, at all good bookshops, because, I mean, the bad ones, I don't care about them. They can go hang. All good bookshops and book sales online will have a fabulous debt.

• 52:03Speaker 05

  Support your good bookshops.

• 52:05Speaker 07

  Yes, definitely support bookshops. I love bookshops. I spend, as you can probably see from my backdrop, way too much money in them myself, but it's a good cause.

• 52:14Speaker 05

  So fun, though. Yeah.

• 52:15Speaker 07

  There's nothing like the smell of a new book.

• 52:17Speaker 05

  Amen. Robin, thank you so much for mentoring our stackers again today. It's great seeing you.

• 52:21Speaker 07

  Thanks so much for having me on again, and I'm looking forward to the hat trick book. I'll come back right again to talk to the stackers about it.

• 52:29Speaker 03

  I'm Andy Dwyer, and when I'm not pulling suckers off my tomato plants in my garden, I'm stacking Benjamins.

• 52:40Speaker 04

  Hey there, stackers. I'm Joe's mom's neighbor Doug. And after all that bond talk from Robin, this bond-themed trivia question should be super easy for you. How about this one that dovetails right into what Robin was talking about? Ian Fleming wrote the original Bond series. The movies were based on the, wait, what? Robin didn't mention James Bond, not even once? How can you do an entire Bond show and not talk about James Bond?

• 53:10Speaker 04

  Actual Bonds. Huh. Well, that's a loop. Or maybe I should listen a little bit closer next time. Anyway, thank goodness, this is a variety show, am I right? I'll just round it out then with some James Bond trivia. Okay, I'll do it. Check this out. Ian Fleming wanted a boring name for his secret agent with a license to kill, so he based the now legendary character on a real person with a real, what Fleming called boring, job. The real Bond was actually an ornithologist. What does an ornithologist do? I'll be back right after I go ask Robin for a copy of his new book. Maybe I've got some catching up to do on this Bond thing.

• 53:53Speaker 05

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  jobs. And guess what? Our stackers are going to get a $75 sponsored job credit. That's you to help get your job the premium status it deserves at indeed.com/podcast. Just go to indeed.com/podcast right now and support stacking Benjamins by saying you heard about Indeed in mom's basement. Indeed.com/podcast. Terms and conditions apply. Need a hiring hero? This is a job for Indeed sponsored jobs.

• 59:08Speaker 05

  Hey there, stackers. I'm Bond lover and man always ready with the most dangerous trivia questions. Joe's mom's neighbor Doug. Today, Robin and I are covering the entire world of bonds. He took the easy way out and covered the financial instruments while I took the high road and am diving into the world of secret agents and James Bond. At least that's how I'm selling it right now. Here is today's question. Ian Fleming wanted a boring name for his top secret agent, so he stole the name of a real man named James Bond, who actually had a straightforward occupation. He was an ornithologist. What does an ornithologist

• 59:47Speaker 05

  do? An ornithologist studies and is an expert in all things birds. Like a bird, I'm going to fly upstairs to see if Robin's been able to secure a post interview snack. Maybe I can get in on that like a modern day James Bond, right? See ya.

• 1:00:06Speaker 05

  Big thanks to Robin Wrigglesworth for joining us. The history of the bond is the history of empires. Oh gee, it turns out. And to your point, on a daily basis, you and I, bonds in my daily life, probably not. Bonds in the life of a regime or bonds in the life of an economy, probably much, much, much bigger. So while following it, I think could be fascinating and knowing how they work can be fascinating. Not going to have a ton to do with you on a daily basis, but certainly back in 2007, 2008, it's wild how the crisis all came down to being a bond crisis, really. You know, it's a real estate crisis, but really a bond crisis. Let's do a headline.

• 1:00:49Speaker 03

  Hello, darlings. And now it's time for your favorite part of the show, our stacking Benjamins headlines.

• 1:00:56Speaker 05

  Our headline today comes to us from the Wall Street Journal. Interesting piece here, OG, for our stackers who are seeking their next job. This is written by Theo Francis and Ray Smith. Americans without college degrees are having one of the best job markets in years. Unemployment among younger workers who didn't go to college has rarely been lower in recent decades. It's the opposite story for college grads. Let's dive into this. Normally, when college grads find the job market sinking and they struggle to find jobs, people without college degrees do as well. The two markets generally move in tandem.

• 1:01:38Speaker 05

  One goes down, the other goes down. That's not the case right now. People with a college degree finding it more difficult to find work and people without a college degree finding it easier than than ever. Does that surprise you?

• 1:01:53Speaker 06

  No, I guess I don't have much of an opinion about this because I can't really keep track of the professional market versus non-professional. Right. I mean, just anecdotally, it seems like, I guess I would like to know, like, what is the definition of it's hard to? Because unemployment's at a pretty decent rate. Is it as good as it was two years ago? Probably not, but it's still okay. To my knowledge, there does seem to be a lot of infrastructure spending. I mean, just anecdotally, you know, what's the name of that company that Elon Musk has?

• 1:02:28Speaker 05

  Tesla?

• 1:02:29Speaker 06

  No, the other one.

• 1:02:30Speaker 05

  SpaceX.

• 1:02:31Speaker 06

  SpaceX. There we go. I knew I'd get it eventually. Sure. They just announced a really, really, really giant project in Texas, another one in Louisiana. So you think about like a couple of infrastructure projects like that are going to provide countless jobs for construction and welders. Who knew? So that seems to be pretty good. And it's somewhat AI proof, right? I mean, like, at least at this point, we don't have HVAC, AI HVAC people coming and showing up and fixing your AC. It's going to be a guy in a truck with a part.

• 1:03:03Speaker 05

  That appears to be 100% what's going on here. OG is that the entry level jobs that new college graduates were filling before they moved up the ladder to the next area, those entry level jobs largely being handled by AI.

• 1:03:18Speaker 06

  Poorly, by the way, I would say.

• 1:03:19Speaker 05

  Oh, 100%. However, in non-AI positions, you've got these jobs that can't be filled by AI. In fact, there's a quote in here from Gad Levinon, who's an analyst with labor market think tank Burning Glass Institute. Gad says, there aren't enough skilled trades people to go around as older generations retire and immigration drops. And at the same time, you have more Americans with college degrees than ever before, just as AI is doing more of the entry level work. Levinon says, there's a rapidly growing supply of people with bachelor's degrees and you have a rapid decline of people who don't. I don't think

• 1:04:04Speaker 05

  that's a temporary thing, that we've got this really long-term trend.

• 1:04:10Speaker 06

  It's become more valuable. Got it.

• 1:04:12Speaker 05

  And where has it been toughest to find a job? Entry level jobs in the sciences are number one, with a higher rate of unemployment than back in 2003. So we're looking at really long-term trends here. Second is computers and math. Third, education. Fourth, management. Then it starts to really go down a lot. Office and administrative support, legal still really hanging in there. Then maintenance, repair, construction and mining, food services, of course, hard to replace those things with AI. The more physical and in-person the work is, the lower the unemployment tends to be by that occupation's own historical standards. The booming job report that came out just a couple of weeks ago reinforced the trend.

• 1:04:57Speaker 05

  Food services and drinking places added 59,000 jobs in August, more than a third of all 162,000 jobs added to the US economy in the last month. By contrast, college educated workers 22 to 34 years old have only seen worse unemployment in the past two decades during the pandemic and economy slow rebound from 2007 to 2009.

• 1:05:22Speaker 06

  Okay.

• 1:05:24Speaker 06

  Reevaluate your, your plans.

• 1:05:27Speaker 05

  Yeah. If you're looking for a job right now, it, I don't think I'd go into something just because of the fact that, you know, this is where the jobs are. But if you're somebody who is, you know, one of those people that aren't really sure that college is for you, but you think, you know, everybody's talking about college, like this analyst said, Levinon says, there's a certain percent of the population that feels like, hey, everybody's doing it. I need to go to college. More evidence, again, OG, that it doesn't have to be for you.

• 1:06:00Speaker 06

  Yeah, doesn't have to be. Yeah. And guess what? College will be there in five years from now and 10 years from now, if you change your mind.

• 1:06:07Speaker 05

  I'm glad you brought that up because, you know, Linda Gratton, a couple of weeks ago, talking about thinking in terms of 100-year living. If you explore welding, let's say, like you talked about on Monday.

• 1:06:19Speaker 06

  Hypothetically.

• 1:06:20Speaker 05

  Yeah. You explore welding and then you become a great welder, but then you want to own the business? Maybe going back to school 10 years in to get your business degree to supplement the fact that you've got the welding knowledge, you've got the chops to actually do the role? Like, how great would that be?

• 1:06:38Speaker 06

  You can meld them together, right? If you already know, it's like the E-Myth thing, right? The difference between being the tactical professional that knows the thing and being a business owner is markedly different. And if you have the skill set of I know what to do, and then you learn how to be a business owner in this example, and it's like, okay, now I can learn to be a business owner, and I also have the skills to know what it's like on the other side of the table.

• 1:07:01Speaker 05

  And all of these pros we've talked to over the years, talking about how older all the studies show, older people in college, when they go back to get their college degree, higher grades, much more focused, know exactly what they're there for. They have the ROI attached to it. I'm going back to school because I own a welding company, or I want to own a welding company, or go into management, a welding company, and I need this specific skill set. So they're much, much more likely to have a successful college experience than somebody just out of high school. I'll link to this piece.

• 1:07:31Speaker 04

  Plus, now you really know how to party. Like, when you get to that age, you know exactly how to do it right. Like, you don't waste your time on all this distraction stuff.

• 1:07:39Speaker 05

  I'm not drinking Jäger. Put the Jäger down.

• 1:07:41Speaker 04

  Exactly.

• 1:07:42Speaker 05

  Like, what are you doing with this stuff? Yes. Now you're partying with a good pinot.

• 1:07:49Speaker 04

  And you're just focused. You're just more focused.

• 1:07:52Speaker 05

  On the right part of the party. Yeah. Great stuff. I'll link to this on our show notes page at stackingbenjamins.com. Pretty fascinating for anybody looking to get into the job market. Don't think college is for you? Well, guess what? You're the job market for you. It's pretty darn good right now. All right. That's going to do it for today, except for the back porch. We wander out on the back porch, we find out what's going on the community. And guess what, Doug? We got a letter.

• 1:08:20Speaker 02

  We just got a letter. We just got a letter. We just got a letter. Wonder who it's from.

• 1:08:28Speaker 05

  Who's writing us, Doug?

• 1:08:30Speaker 04

  Today, we have a letter from Jeff, and he says, "All this talk about your Quince pants."

• 1:08:39Speaker 05

  I love it would be, I want to hear more about Joe's pants. That's so awesome.

• 1:08:44Speaker 04

  Said, "Nobody ever." "All this talk about your Quince pants reminds me of seeing Steve Martin when he first started touring his bluegrass show, and he talked about how he is back on the road and living out of a suitcase like his earlier stand-up years." Martin said, "People are telling me that my pants are always neat and pressed. That's when I realized I've got a steaming hot ass."

• 1:09:09Speaker 05

  That's so good. That's how you know. If people are always talking about your pants, and people have been talking about how they want to hear more about my pants, I know what they're really thinking, Doug.

• 1:09:17Speaker 04

  Yeah.

• 1:09:17Speaker 05

  So Jeff, you're right. I mean, I've seen in the mirror.

• 1:09:20Speaker 04

  Come to that realization. Jeff goes on to say, "Thanks for all the great work for so many years. I will always remember the fun evening in Nashville at the Beer Garden near Opryland."

• 1:09:30Speaker 05

  Ah, Jeff!

• 1:09:31Speaker 04

  It's getting awkward. And kidding to meet you and so many other personal finance podcasters that I now listen to. Paula is now my second favorite behind SB.

• 1:09:43Speaker 05

  Paula Pant came out that night, and we had a great time. We just sat outside of this great microbrewery, and everybody kind of shared their money story, and we told some behind-the-scenes stories. What a great time, Jeff. I agree. That's a great memory. Lots of fun. By the way, for people that want to know when we do travel around the country, get the 201, our newsletter. It also has a very high open rate. Kevin Bailey does a heck of a job of diving into these topics that we talk about, but in a way that's actionable for you. So you can take the stuff we talk about on the show, and he gives you some prompts to really work through to make sure that this is as effective for you as it can be. So stackingbenjamins.com/201. But then also, we can email you when OG Doug or I go around

• 1:10:26Speaker 05

  the country, like that time in Nashville. I happened to be there for a conference, and we had a great meetup. Thanks so much for the note, Jeff. If you've got a note, [email protected]. But if you've got a question, we are going to be building another episode using your questions. You will be the focal point of a future stacking Benjamins episode, or two or three episodes, as we get more questions. stackingbenjamins.com/ yeldownsstairs, or just stackingbenjamins.com/voicemail. Super easy. And you know what? For being brave and helping us make the show, we send you some of our sweet stacking Benjamin swag. That when I was recently at a Camp Fy, it was really cool seeing stacker Janelle, who came around the corner, and she was wearing one of our sweet stacking Benjamins t-shirts,

• 1:11:11Speaker 05

  which was awesome to see out in the wild at Camp Fy. All right. That's going to do it for today. Thank you so much. If you know someone who is a student of history, wants to know how this economy was built on the backs of bonds, send them the episode. Robin is just a fantastic teacher, as you just heard. All right. Coming up on Friday, a great roundtable, but for now, we're going to leave it to Doug. Doug, what should we have learned on today's episode?

• 1:11:37Speaker 04

  First, take some advice from Robin Wigglesworth. Want to know what's really happening in the world? Follow the bond market. That'll give you all the clues you need to make better financial decisions. Second, thinking about college? Have you considered trades? They're more lucrative than ever, and maybe a great career choice. But the big lesson? Don't spend time trying to impress Joe's mom by talking about bond. James Bond. She's a ninja at flipping that into dishes. Lots of dishes. It's not the same, ma.

• 1:12:12Speaker 04

  Thanks to Robin Wigglesworth for joining us today. Be sure to check out his new book, A Fabulous Debt, wherever books are sold. We'll also include links in our show notes at stackingbenjamins.com.

• 1:12:25Speaker 04

  This show is the property of SP Podcast LLC, copyright 2026, and is created by Joe Saul Sehi. You'll find out about our awesome team at stackingbenjamins.com, along with the show notes, and how you can find us on YouTube, and all the usual social media spots. Come say hello. And oh, yeah, before I go, not only should you not take advice from these nerds, don't take advice from people you don't know. This show is for entertainment purposes only. Before making any financial decisions, speak with a real financial advisor. I'm Joe's mom's neighbor Doug, and we'll see you next time, back here at the Stacking Benjamin Show.