Is "This Time Different"? A FinCon Panel on AI, Inflation, and Interest Rates SB1902

Live from FinCon, Joe sits down with historian and bestselling author Joseph Moore, Paula Pant, and Jesse Cramer to talk about what's actually keeping people up at night: AI concentration in the stock market, inflation anxiety that won't fully fade, interest rates that feel "stuck," and a housing market that seems rigged against newcomers. The twist is that almost none of it is new. From a Scottish con man's fake country bonds to the 1830s stock that was over 30% of the entire market, to a refrigerator boom that happened during the Great Depression, this conversation uses 300 years of financial history to put today's anxieties in real perspective. What You'll Walk Away With Why "this time is different" has been true in every single era of financial history, and why that's actually reassuring, not alarmingThe real reason today's AI-heavy stock market concentration isn't as extreme as people fear, compared to genuine historical outliersWhy equal-weighted index funds tend to underperform market-weighted ones, and what that reveals about betting against your own winnersA fascinating historical parallel between AI infrastructure spending today and the railroad boom of the 1800s, and where that comparison breaks downWhy the fastest way to build real wealth during a technological boom is often working in the industry, not investing in itHow the "golden handcuffs" of low mortgage rates are quietly fueling a broader sense of economic pessimism, even during a strong economyWhy increasing your income is one of the few truly controllable levers in your financial life, and why it usually takes longer than people expectWhy This Matters Now Every generation convinces itself that its economic moment is uniquely unprecedented, uniquely uncertain, uniquely dangerous. History suggests otherwise: markets concentrate around a handful of winners, technology booms take decades to actually change daily life, and financial anxiety tends to track personal experience more than actual data. None of that means today's concerns aren't real. It means the emotional weight of "this has never happened before" is usually misplaced, and understanding that can be the difference between panicking through a normal cycle and staying invested through one. Resources Mentioned How to Get Rich in American History by Joseph Moore https://www.josephmoorebooks.com/p/how-to-get-rich-in-american-history — Joseph's USA Today bestselling book on 300 years of financial advice, what worked and what didn'tAfford Anything podcast https://affordanything.com — Paula Pant's showPersonal Finance for Long-Term Investors podcast https://bestinterest.blog/personal-finance-for-long-term-investors/ — Jesse Cramer's showMen Go To Mars https://mengotomars.com — sponsor mentioned in the episode See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

• 0:00Speaker 00

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• 0:30Speaker 01

  Greetings and salutations. Zoo bup a doo and how do you do? I am the great PT Flea. I'm in need of your assist. Oh, let's just cut to the chase.

• 0:48Speaker 02

  Live from the FinCon Expo, it's the Stacking Benjamin Show.

• 1:02Speaker 02

  I'm Joe's mom's neighbor Doug, and it's time for our annual trip to the largest financial creator conference in all the land. Today's topic, what are you worried about with your money? So without further ado, let's send you to Palm Springs, California. Oh yeah, it sounds like a pretty tough assignment, Joe. Thanks for jumping on that grenade. Here is Joe Saul Sehi.

• 1:28Speaker 03

  Thanks Doug. Hey everybody, welcome to the Crater CPA Podcast Stage at FinCon. We've got a fantastic panel with us today. Let's start with a woman right to my right, to your, I don't know, left, right, yeah, right? Paula Pant is here from Fort Anything. How are you?

• 1:45Speaker 04

  I am fantastic. How are you, Joe?

• 1:47Speaker 03

  I gotta say, you and I work together a lot, but it's always fun when we get to actually meet in person.

• 1:52Speaker 04

  I know. It's so much fun in person. The energy, the vibes, it's great.

• 1:57Speaker 03

  And a guy that I told Paula Pant, I'm like, you're gonna love this guy. She's like, whatever, Joe, whatever. So she finally interviewed him. Do you love this guy?

• 2:05Speaker 04

  He's my favorite Joseph.

• 2:08Speaker 03

  I'm sitting right here. Bestselling author Joseph Moore back with us. How are you, man?

• 2:12Speaker 05

  I am great. It's great to be here. It is great to meet you in person as opposed to virtually. I didn't know you had legs. I just saw you from here up. And so, yeah, it's wonderful.

• 2:20Speaker 03

  It's a miracle. Joseph comes up to you, he's like, it's a miracle. It's incredible. You have legs. How has the book tour gone?

• 2:26Speaker 05

  Still going, so that's a good sign. I've gotten to meet so many interesting people, a lot of people who are here too. Like you just, you meet so many smart, fun, dedicated people, and that's the joy of being on a book tour.

• 2:37Speaker 03

  That is though, also I think what makes this conference, this conference, Joseph, is that somebody told me this yesterday. One of the vendors told me, they said, we go to a lot of money conferences, but they're usually bankers or investors, investment people. This is so collaborative. And most of the people that create this stuff, it's not like they're getting wealthy on it. They're not getting rich on it. That's your next book, Getting Rich on Creating Financial Content, right?

• 3:00Speaker 05

  It'd be like a half of a chapter.

• 3:03Speaker 05

  No, but I think you're absolutely right. I think you go to many, and I've been to many of these, and I've interviewed a lot of these people, and nothing against them, but like there is a kind of baseline assumption of what's in it for me. And the people around here is like, what's in it for my audience?

• 3:12Speaker 03

  Yes.

• 3:13Speaker 05

  Right? What's in it for the people I'm trying to serve? And that's, that does stand out.

• 3:16Speaker 03

  It is a really cool, really cool group of people. Speaking of, the guy to your right, super cool, always happy to see him. Jesse Cramer from Personal Finance for Long-Term Investors is here.

• 3:27Speaker 06

  I was thinking about, as Joseph was talking, I was thinking, a lot of audience members probably think we're just these floating voices. These bodyless voices. Is like, God, is that you coming down? And here we are, two legs, two arms, 11 fingers.

• 3:41Speaker 03

  No way I hear 11 fingers.

• 3:45Speaker 03

  And 12, 12 toes. Yes. Jesse, who's watching the kids while you're here?

• 3:49Speaker 06

  Oh, my wife Kelly's at home with the two little babies, but she is hanging out with her parents in Buffalo. Go Bills. So she's got some support from my in-laws, her parents.

• 3:59Speaker 03

  We have Jesse Cramer, Joseph Moore, Paula Pant here. Every year we do this at FinCon, so if you're new to Stacking Benjamins, welcome. We do this topic of, we've got these three wonderful people with us. I love talking about what's going on in the zeitgeist. What is your audience worried about? And Joseph, for you, I wanted you on this panel because you have a unique perspective. You're being interviewed by a lot of different people, and they're always trying to tie history to things going on today. What are they obsessed about? Like what has kind of struck you there? So we're going to talk to Paula, Joseph, and Jesse about that today. But we have a couple sponsors who help us keep on keeping on. We're going to hear from them. And then live from FinCon, we are going to talk about, what are you worried about?

• 4:45Speaker 03

  Wait a minute, Joe, I thought you were in Palm Springs. I was, but now as I'm finishing up the episode, I forgot I wanted to talk to you about Mars Men. I started to notice it in my 30s. A little bit more brain fog, had some difficulties concentrating. In my 40s, it got a bunch worse. And in fact, I just recently had an issue with caffeine that I really don't want to get into, but it's just because I was taking more and more and more caffeine just trying to get it into the bloodstream and make sure that I was able to finish the long days that I do because I enjoy being here with you. Because people, and I was doing this too, you start to blame yourself for not wanting it enough. Do I want it like I used to? It's not that at all. Turns out that starting in your 30s,

• 5:29Speaker 03

  you lose about 1% of your testosterone per year, guys. So I'm talking specifically to the men. If you're feeling the way that I did, the answer might not be caffeine. It might be Mars Men, because when I started using it, this was amazing. Here's what you don't realize is that your testosterone is still being made by your body, but it's being blocked. And so this protein SHBG, they call it, I'm a finance guy. So a lot of this I had to dive into to find out what the science is behind Mars Men. Even if your T levels look fine on paper, a lot of it's bound up. It's not doing anything because of this protein.

• 6:09Speaker 03

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• 6:53Speaker 03

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• 7:34Speaker 03

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• 9:17Speaker 03

  Paula Pant, kick this thing off, girlfriend.

• 9:20Speaker 04

  Absolutely.

• 9:20Speaker 03

  What are the afforders really worried about?

• 9:23Speaker 04

  What's in the zeitgeist? So I'd say there's sort of two categories of questions that, Joe, you and I answer questions on my podcast.

• 9:30Speaker 03

  Yeah.

• 9:30Speaker 04

  There are really two categories of questions. One, that's evergreen, and those evergreen questions are, hey, how do I prioritize among all of these different goals?

• 9:40Speaker 03

  Right.

• 9:40Speaker 04

  You know, they, I want to retire in the next five years. I want to pay for my kid's college. My car is 10 years old, so in the next five years, I'm going to have to replace it. I'd like to buy my next car in cash. Should I pay off the mortgage or invest that money instead? Those are the evergreen questions, and those don't stop. So no matter what era we're in, they're always on.

• 10:01Speaker 03

  Same, same, yeah.

• 10:02Speaker 04

  Layered on top of that are questions around inflation. Money feels tighter. I'm golden handcuffed to my, if they're an existing homeowner, I'm golden handcuffed to my home because I've got this 3% mortgage interest rate. And if they're not a homeowner yet, it's like, all right, well, I don't know if I can buy a home or do I need a, does this mean I need a house hack? So there, I've gotten more house hacking questions, more like, what are the rental property ways to get into homeownership? Either house hacking or like buying something out of state. And those are all functions of inflation and high interest rates.

• 10:37Speaker 03

  Okay, I asked you for one, you gave me seven. Thank you very much. Well, let's take this off the top. Let's talk about inflation, because last year when we were here, we were worried about inflation. Year before that, we were worried about inflation. It was a long time before that, Paula. We didn't talk about inflation on my show, your show, Jesse's show. We didn't talk about inflation at all. And now we're all obsessed with inflation. I watched a CNBC piece yesterday in my hotel room where the person said, listen, all the numbers around inflation are looking a lot better now than they did before. So this is kind of in the past. Do you think it's in the past? Is this going to be the last FinCon we talk about inflation for a while?

• 11:14Speaker 04

  It will not be the last FinCon that we talk about inflation for a couple of reasons. Number one, you know, when you're healthy, you don't think about things that could go wrong. Like when you're in your twenties, no one talks about their blood pressure.

• 11:25Speaker 03

  Yeah.

• 11:26Speaker 04

  But then, once it becomes part of your awareness, then you, it's something that you're always monitoring for a long time. So inflation, just for that reason alone, like the fact that we've all gone through 2021, 2022, where we had, where it peaked at 9%.

• 11:40Speaker 03

  So now we're hypervigilant?

• 11:41Speaker 04

  Exactly, yeah. It created that hypervigilance. It created that awareness. For a lot of us, like, you know, if you're a millennial, you've never experienced inflation in your life until 2021, 2022. For people who didn't experience the late seventies, early eighties, like this is our first encounter with it. So that awareness that got developed, like that's always going to be there.

• 12:02Speaker 03

  Joseph, this woman on CNBC said that maybe inflation's behind us. We always tend, I feel like, at least during my career, that we worry about stuff after, when it's too late, right?

• 12:14Speaker 05

  Right.

• 12:15Speaker 03

  Is this the way it's been throughout history? That we're like, oh, I should have seen that coming, but I didn't.

• 12:19Speaker 05

  And what tends to happen is you look at what was normal when you were of age, when you were coming of age, when you were getting the advice you were getting and receiving it and try to adopt it. And then you overlay that onto the future. And then when something doesn't work, you tend to like overreact to that one thing that didn't work. Nobody's paying attention to all things that did work, right? Like if you were doing a lot of the smart things that continue to work, you don't pay attention to, you pay attention to the one thing that like, nobody really prepared you for 7%, 8% home mortgages. And so you're, you're kind of obsessed with the handful of things that are new, instead of seeing, you know, the stability behind it. So I think there's a lot of people who are jumping onto this, some because they weren't told what to do.

• 12:58Speaker 05

  Nobody gave you, the only people alive right now who ever saw inflation even hint at something close to, you know, to where it is today. Oh, that was back in the eighties? Like, nobody saw this.

• 13:09Speaker 03

  Yeah, early eighties.

• 13:10Speaker 05

  Yeah, nobody has advice built for this, especially not real estate investors. Like if you're a real estate investor, the last group of real estate investors who ever saw eight, nine, 10, you know, the idea of it, just conceptualizing, not that it's here now. Those people were investing in the early to mid eighties. So there's nobody around to give you that advice. So you just don't have it. You have nobody to lean on.

• 13:28Speaker 03

  It is interesting. I want to go back to the obsession that we have. I know we looked at a lot of statistics around millennials, like millennials coming of age during the 2008 housing crisis. A lot of people became afraid of saving before they even started saving. Because they're like, look at, people lost their house, people lost their savings, and you're saying that carries through your entire life?

• 13:48Speaker 05

  Yeah, you lock into what you think should be the right answer. And so you give that answer, whatever the equation is.

• 13:53Speaker 03

  Yeah.

• 13:53Speaker 05

  And that becomes a problem. You know, you have to stay adaptable, and that adaptability is hard. That's why you have to continuously learn and grow.

• 13:59Speaker 03

  Yeah. Jesse, on the financial planning side of that, like you see this, you see the bias people walk into your office with, right?

• 14:06Speaker 05

  Yeah.

• 14:06Speaker 03

  How do you kind of kick people out of the bias? Or how do you at least point it out and help them change course?

• 14:12Speaker 06

  It's so hard. It's so behavioral, it's so psychological. A dear contact of mine lost a lot of money in the dot com bubble, right? 1999, 2000, 2001, lost a lot of money in stocks, was, was picking the stocks, picking, you know, bread.com, whatever those tech companies were, quote unquote, tech companies, and lost a lot of money.

• 14:30Speaker 03

  Wait, did you say bread.com?

• 14:31Speaker 06

  Whatever they were, shoes.com.

• 14:32Speaker 03

  Have you ever heard of bread.com?

• 14:33Speaker 04

  Never, I've heard of pets.com.

• 14:35Speaker 06

  Well, you know, bread.com, it was a big company back in.

• 14:38Speaker 03

  You could tell Jesse was there.

• 14:39Speaker 06

  And then it just went out of business. Everything was rising, the bread was deflating. No yeast. Anyway, this guy hasn't owned the stock since. He hasn't owned the stock.

• 14:50Speaker 03

  No stocks, oh lord.

• 14:51Speaker 06

  All bonds, all bonds. And, and, and again, it's, it's not, there's not a technical reason why. It's, it's, it's a feeling. It's, it's the feeling of, at the time, he was probably in his mid to late thirties, he had kids, and he lost a lot of money that otherwise could have done something productive for his family. And probably that the guilt or the anger or the shame of that has, that feeling has never quite gone away. Like the scar tissue from that feeling is still somewhere in his brain. And it's, I think it's just, it's hard to overcome that without, I suppose, probably a lot of conversations. And that's where there's this weird border between financial planning and financial therapy. And it probably exists for, for these kind of situations.

• 15:29Speaker 05

  There's actually some good research studies on this. So for the generation that lived through the Great Depression and the crash.

• 15:34Speaker 03

  Yeah, yeah, yeah.

• 15:34Speaker 05

  They were perpetually terrified of stocks. And, and even as the stock market rebounded, did not take part in it for a long, long time. Similarly, with inflation, there's a fun study that was done of the biographies of Fed governors. This is the board of governors for the Federal Reserve. And what they found is like, the inflation rate in their childhood was a better predictor of their votes to change the base rate than was the data they were presented with.

• 16:01Speaker 03

  Wow.

• 16:01Speaker 04

  Wow.

• 16:02Speaker 05

  So like, I mean, even, so whether you're the average person on the street trying to figure out what to do with your paycheck, or whether you're a governor of the Board of the Federal Reserve, the way you encountered financial experience and life when you were younger, it shapes you for the rest of your life, what you think is normal, what you think should happen.

• 16:18Speaker 03

  And it's what, we tell ourselves it doesn't. We tell ourselves like, no, I'm not biased.

• 16:22Speaker 05

  I look at the data.

• 16:22Speaker 03

  Yeah, just, just the data. Jesse, that gentleman didn't invest in stocks, did he invest in real estate?

• 16:29Speaker 06

  Uh, he owns a primary home, but no, no, I mean, he was a.

• 16:32Speaker 03

  No stocks, no real estate.

• 16:33Speaker 06

  Put money in the bank account, put money in bonds that are earning anywhere from 3% to 5%. And then social security and a small pension. I mean, it's just fixed income all the way through. And, and granted, he's living a perfectly reasonable retirement, but there's this idea of like, well, man, could he have retired sooner? Could he be living up a little bit more? Like, of course, and, and you know.

• 16:53Speaker 03

  But he must have a pension then, because otherwise you got to save like dollar for dollar the money you're going to spend.

• 16:59Speaker 06

  He does, he does, he does. But again, it, the funny thing is, from a planning point of view, if you have a pension, you don't even need that much extra fixed income. If anything, if you have a pension, that is the fixed income.

• 17:09Speaker 03

  That is your fixed income.

• 17:09Speaker 06

  You could get away with less. So, but again, this is one of those ones where psychology and behavior just trumps what the numbers, what the numbers look like.

• 17:17Speaker 03

  I brought up real estate on purpose because historically, real estate and stocks are the two things that, that have driven growth in your portfolio. But I saw this video yesterday that I found really compelling. Somebody said, the game is rigged. Like, and what a great way to start a video, right? With this hook, the game is rigged.

• 17:35Speaker 05

  You're going to get no clicks with that.

• 17:36Speaker 03

  No, not at all. The game's rigged. But then here's what they said that I found very compelling, which is that over the years, as more people become dependent on stocks in their 401K plan and their 403B, whatever retirement plan they have, and more people become real estate investors, the lawmakers make laws that are more friendly to stocks and are more friendly to real estate. And this person's real point of view was, if you're not in stocks and real estate, you're not in this rigged game. These are positioned, lawmakers are positioned to help them go up as much as possible. Do you agree with that, Paula?

• 18:11Speaker 04

  I, I do agree with that. And I think, you know, one of the challenges when it comes to housing affordability is we have a system in which incumbent homeowners are incentivized to protect their home values.

• 18:21Speaker 03

  Oh, yeah.

• 18:22Speaker 04

  And because of that, incumbent homeowners often don't want higher density. They don't want multifamily construction. They want to preserve single-family home zoning.

• 18:33Speaker 03

  They're directly against solving the biggest problem. Problem we have in housing.

• 18:36Speaker 04

  Exactly, right? So if you're preserving single family home zoning and there's parking requirements and minimum lot sizes and you're trying to impose these anti-density regulations, which is what we see across municipalities.

• 18:49Speaker 03

  Yeah.

• 18:50Speaker 04

  What does that do? Anti-density regulations means that you can't build more housing and put more people in that same land, which means home values, like we have a shortage of housing supply. So it protects existing home values, but it also locks newcomers out of the system. And so one of the challenges really in the housing market and one of the reasons that we have such a lack of affordability in housing is because you have a system in which incumbent homeowners are protecting their home values at the expense of incomers.

• 19:23Speaker 05

  Yeah. Wow. We've seen this before, by the way. So this has been my argument all along about why social security is not going away. You know, the joke that social insecurity should be called social insecurity? That joke goes all the way back to the 60s.

• 19:34Speaker 06

  Really?

• 19:34Speaker 05

  Yes. And it was actually originally a critique from the left, not from the right. Because they said, this is not nearly enough to survive on in old age. And so this has been this debate about what's wrong with social security forever. And it'll certainly never make it. It will never. I can people saying in the early 70s, this system's going to go bankrupt by 1980. And like over and over and over. But here's the thing. All these incumbents, all these voters who elect all these lawmakers are not going to vote for someone to take this benefit away from them.

• 20:00Speaker 06

  Away. Yeah.

• 20:00Speaker 05

  And so we see this in a lot of areas of the economy that people start to look at as somehow not fair or not solvent or whatever. But then there's no incentive for anyone to remove the peg that would cause it to fall.

• 20:12Speaker 03

  I remember legendary finance writer, Jane Bryant Quinn, during the 1990s, saying, there is no way social security is going away, for exactly the reason you said, Joseph. It's the biggest social program in the United States. You think they're not going to do something to at least duct tape this? I mean, you're voted out immediately.

• 20:28Speaker 05

  Right.

• 20:28Speaker 03

  If you don't do it. You also looked at me funny when I said stocks and real estate over the long term have been the two ways. I bet you're going, yeah, not so much.

• 20:37Speaker 05

  Well, the real estate has an on again, off again relationship with the investing world. Now, again, this idea that you just buy it and hold it and it will just go up because, you know, that nobody has a thing after because. And historically, people would have thought you buy real estate, as Paula knows very well, you go in and you change that property, you make it better, you add value. That wasn't traditionally the way people would have invested in real estate. Now, the way people invest in real estate is they look at a shortage and they want part of that shortage we're talking about, right?

• 21:02Speaker 03

  Right.

• 21:02Speaker 05

  They see that all of these incumbents who are tripping up the YIMBY movement, the yes in my backyard movement, and saying, no, you will not in my backyard. You know, we will not allow this. There's just so many forces at play. And so people, not illogically, are going, huh, it's highly unlikely we solve this quickly. And so they're trying to buy into a limited pool of real estate that you can run out. I say oftentimes, I don't really own real estate. I don't own houses. I own zoned land. And it's the zoned land that is valuable. It just so happens there's a house on top of it in a good school district. And so when you kind of see that people are, they're honestly eyeballing the shortage that's in front of them in their lifetime, it wouldn't have worked in previous eras. It really wouldn't have worked in previous. You're just like, I'm just going to buy it. It's going to go up. People did that in West Virginia, died with no profits

• 21:46Speaker 05

  because no human being to this day has ever been on that land. So it doesn't go up because it's there. Today, however, it goes up because it's zoned the right way and they're not making more of the zoning.

• 21:56Speaker 03

  It's such a complex conundrum we have with the housing crisis. And it's going to be interesting to see where this goes the next few years.

• 22:03Speaker 06

  I think there's an opportunity to make more land.

• 22:09Speaker 06

  Follow me here. The moon. Bring it down, spread it over the ocean like frosting on a cake. Zone it, build a nice school there, lunar school, sell it.

• 22:20Speaker 03

  That's all you gotta do.

• 22:21Speaker 06

  Profit.

• 22:21Speaker 04

  Wait, why do we have to bring it down? Why don't we just go there?

• 22:24Speaker 06

  Good question. Let's get Elon on. Let's get Elon on.

• 22:27Speaker 03

  Well, if we go there, then we give Elon all the money, as if he doesn't already.

• 22:30Speaker 05

  Yeah. Which, by the way, was one of the arguments in the 1940s and 50s against, there was an argument for not letting the private market solve the housing crisis. They had a huge housing crisis in the 1940s, bigger than ours today. There was a bestselling book from members of the Truman administration who said, the private market can't solve this. For one, they won't build them fast enough. For two, then people would get more, all the builders would get wealthy. And so just let the government solve it. Well, how did that work out? Right? And so what actually solved it, if you go to Queens, New York, that used to be farmland until you get the, is it?

• 23:01Speaker 06

  Levittown.

• 23:02Speaker 05

  Levittown. Levittown's farmland and these guys come in and they just like make all these 800, 900 vacation homes in some places. But like for some people, it's their primary residence. And that was what caused the building boom of the 50s and 60s. So we've seen it before where people said, it can't be solved. It can't be solved, but you gotta build more houses. And you gotta either do it on the moon or with farmland or something. Or you gotta go up, you gotta go out, but you gotta find a way to solve it. I'm rooting for us to solve it. I have a ton of real estate. Please make me poor. I beg you. Like, let's find a way to solve this problem because it's not good for the next generation. Now, here's the one flying the ointment nobody's talking about. We're going to peak. You and I know as real estate investors, it's place, right? Supply, population, people.

• 23:40Speaker 04

  Yep.

• 23:40Speaker 05

  And so what nobody's talking about is in about 2035, we're going to peak in population and it's going to start to decline. And what happens to real estate is an investment class that always goes up when that third leg of the stool, the increased population driving up rents goes away or starts to.

• 23:56Speaker 03

  So you actually think that population changes might help solve the problem?

• 24:00Speaker 05

  I think it'll ease the pressure. I don't think it's going to be, and don't hear me saying it's going to crash because that's not what I'm saying. I think that one of the big pressure points is all the people looking for not enough houses. Well, you gotta, you can solve it one of two ways. More houses.

• 24:12Speaker 03

  Less people.

• 24:12Speaker 05

  Less people. And about 20, mid 2030s.

• 24:14Speaker 03

  That's all you gotta do, Jesse, less people. We don't gotta go to the moon. We just have less people.

• 24:17Speaker 06

  Send them to the moon.

• 24:19Speaker 05

  Yeah, solve it in both directions.

• 24:22Speaker 03

  There's people driving around listening to us right now going, Jesse's from the moon.

• 24:24Speaker 06

  Yeah. What a space cadet.

• 24:26Speaker 04

  When you said that you could build more land, I thought you were talking about, isn't there, is it Dubai or Abu Dhabi? There's somewhere in the Middle East where they're literally making land in the water?

• 24:35Speaker 06

  I think so. And I think China's doing it too. I think China is building, dumping dirt in the ocean and building islands.

• 24:41Speaker 05

  Miami Beach is dredged out of the ocean. When people tell me, you gotta invest in real estate. You hear this a lot in the South. They ain't making any more land. I was like, actually Miami Beach, they made that out of.

• 24:51Speaker 03

  Well, a lot of the Hudson Yards in Manhattan, right where you are, largely was not there.

• 24:57Speaker 05

  Yeah. That's my understanding. A significant part of Manhattan real estate did not exist in the year 1900.

• 25:01Speaker 03

  Yeah. Yeah. Jesse Cramer, we heard from Paula, seven of them, but we chose inflation.

• 25:10Speaker 03

  What are the flitty community worried about?

• 25:14Speaker 06

  I think a good zeitgeist topic right now that again is, it's this border between evergreen. It feels evergreen because it's been 15 years, but it is a little more zeitgeisty is, you know, am I over concentrated in AI stocks? I own index funds. I own index funds. And yet, it feels like all I really own underneath the hood are AI stocks and the pickaxes and the shovels for AI and the chipmakers and how is it all going to play out? So I think that's an interesting and kind of nuanced topic that people are bringing up a lot in maybe the last six months, six months plus.

• 25:46Speaker 03

  Yeah, this is interesting. We actually got a question on the show that we have not answered yet. But the question was, is it time that we go from like investing in the S and P 500 to the NASDAQ, which is largely fewer and fewer companies, to more of an equal weighted index? So that we get rid of some of that risk. What do you think, Paula? Time to make the change?

• 26:06Speaker 04

  No. Number one, equally weighted indexes do, historically speaking, underperform market weighted indexes. And number two.

• 26:14Speaker 03

  Why is that? Is that because of the fact that the greater weighting, the greater weighting is because those are the companies that are actually moving?

• 26:22Speaker 04

  Yeah, yeah. So the number two is the why, that is.

• 26:24Speaker 03

  Okay.

• 26:24Speaker 04

  So the.

• 26:25Speaker 03

  I should have waited.

• 26:26Speaker 04

  So yeah, equally weighted indexes tend to underperform market weighted. And the reason for that is because the idea that there are a few companies that are the runaway winners is a feature, not a bug.

• 26:38Speaker 03

  Yeah.

• 26:38Speaker 04

  Like, it has always been the case that there are a couple of companies that are runaway winners. It was railroad stocks for a while and now it's AI stocks.

• 26:46Speaker 03

  Jesse, let's start a fight. Tell me you disagree. You disagree.

• 26:48Speaker 06

  It's funny that I was having this conversation last week. I don't disagree.

• 26:51Speaker 03

  Damn it.

• 26:52Speaker 06

  And I'm sorry, Joe. I'm sorry. The fact of the matter is that the price that Nvidia, Facebook, Corning, whatever company you want to pick, that price was arrived at. Essentially, it's the average opinion of investors en masse all across the world. And if you believe that markets are efficient, that the theory is you cannot have more information more readily available to you than what everybody else in the world has available to them. And when you own a market cap index, you are basically saying, eh, on average, the market is correct and I accept those prices. And when you own an equal weighted index, what you are tacitly saying is the market is incorrect. I shouldn't own, 7% of my S and P 500 index fund shouldn't be Nvidia. It shouldn't be 7%.

• 27:36Speaker 06

  It should be 1500 or 0.2%. And so what you would do is you would say, I'm going to underweight Nvidia. And that is an active decision. So it just comes down to more of a passive decision versus active decision. And on average, active decision making in the stock market tends to underperform over time.

• 27:54Speaker 05

  That's a great point. I mean, basically saying is you're forcing index investors to become shorts on the biggest companies.

• 28:00Speaker 06

  Shorts on the big ones and overweight on the small ones.

• 28:02Speaker 05

  Yeah. And by definition, that's not what an index investor is trying to do, right? They're trying to do the opposite of, you know, putting in a position on, you know, I think the big ones will fall and the small ones will pop. You know, by the way, what Paula's talking about is so true and it's been true for the entirety of the history of the stock market. Almost all of returns beyond treasury bills, this is a famous study out of Arizona State.

• 28:21Speaker 06

  Arizona, yeah.

• 28:22Speaker 05

  Arizona, is that 90, correct me if I'm wrong, I want to say like 92% of all stocks in American history have tied or underperformed treasury bills.

• 28:32Speaker 05

  Maybe even 94%.

• 28:34Speaker 06

  I think it's that all of the outperformance going back 100 years comes from 4%.

• 28:39Speaker 05

  4%.

• 28:39Speaker 06

  The needles are 4%.

• 28:41Speaker 05

  Yep.

• 28:41Speaker 06

  The other 96% gets you to treasury bills.

• 28:45Speaker 05

  Yeah.

• 28:45Speaker 04

  Wow.

• 28:46Speaker 05

  And you don't know which ones those are going to be, and they often are the outperformers. It's a significant portion of that remaining 4% that are actually carrying the weight for the, for that bit. So it's actually a handful of companies. And so you, you don't want to be in a position where you don't bet on the horse that's winning.

• 29:01Speaker 03

  You've heard this a lot though, Joseph, and I've heard this my entire career. When I would try to allay people's fears of the next thing, people will tell me and probably tell you, this time is different. You don't understand this time is different. This is the thing that's going to, you know, maybe robots don't take over the world, or maybe they don't kill us all, but that's certainly going to fundamentally completely change the game. Do you think this time is different? Cause this, this is a big shift.

• 29:26Speaker 05

  This time is always different. It's never not different. Like that's the thing that people, they want it to, to be one or the other. Either it's going to be just like it always was, slow and steady. Don't worry. Or everything's crashing or everything's booming and nothing will ever be the same. It's actually always been changing. Uh, the people you're looking back on as they say, were living a stable life. They were living what they thought was rapid insane change. They didn't know how to handle it either. We are living in a new era because every era is a new era. So you can't, I, I don't, I don't put a lot of stock in the whole, you know, you know, this time is different or this time is not different. I think it's just constant change. That's capitalism. That's what makes it work.

• 30:04Speaker 04

  And I would say if this is something that a person is really concerned about, the solution rather than equally weighted index, why not just pay attention to your small cap allocation? You know, it does make sense if you, if you don't want to be entirely VTSAX and chill, you can have a little small cap allocation and that's reasonable. And that's a way that you can, you can diversify outside of the mag seven.

• 30:27Speaker 03

  Are you saying diversification wins the day, Paula?

• 30:29Speaker 04

  I mean, not necessarily like.

• 30:31Speaker 03

  Oh, I think it does.

• 30:33Speaker 05

  So here's the other thing is we, we talk about this idea that we've, we've got an overly concentrated stock index. Try the 1830s when there was a single stock that was well over 30% of the entire stock market value. The second bank of the United States stock, and it went from a hundred and $25 a share to a buck 50 in like a year. One.

• 30:50Speaker 03

  See, and this is what people are worried about.

• 30:51Speaker 05

  Yeah. But this, we don't have that. We don't have that. So we, that's concentration you have to worry. You know, if you look at the mag seven or you look at like whatever the biggest parts of the, of the index are, they're actually across, yes, they're all starting to get into AI and there's, but they're doing different things with AI. They're in different industries. Google is not Facebook. Facebook is not Nvidia. I understand that they work in an ecosystem, but this is not nearly as concentrated as earlier areas have been. So that argument to me doesn't carry a ton of weight. It doesn't worry me at all. I have not lost a single minute of sleep to the idea of over market concentration.

• 31:22Speaker 04

  I would also say, if you think about like, all right, are they AI companies? It's, it's almost, I think in the future, we're going to look back on that question in the way that right now we would consider it to be a silly question. If you ask, is something an internet company? Or, you know, like every company, Disney, Coca-Cola, Nike, Lululemon, like they all have an internet presence. They all use the internet.

• 31:46Speaker 03

  Well, and this fascinates me. Let's talk about the upside of AI because when we looked at internet 1.0, right? The go-go years of 1997, 1998, 1999.

• 31:55Speaker 06

  Red.com.

• 31:56Speaker 03

  Yeah. Stock's so popular, I'd never heard of it. But I remember, you know, and I've told this story before, I had a client that was getting, uh, with the allocation I helped him put together. He was getting well over 45% and he fired me because his friends were getting like 70, 65, 70%. And he wanted to keep up with them because, so he goes heavy duty into tech, 2000, we know what happens. Fired me literally in, uh, January of 2000. So, and not that I'm still bitter about it. And I don't remember the exact date, but it might've been January 23rd. No, I'm kidding. But what's interesting is I saw a video yesterday where this gentleman was saying, Paula, kind of what you're alluding to, which is internet

• 32:39Speaker 03

  1.0 was all about these companies like Cisco that are creating the internet, right? And it's going to be amazing. And of course then Cisco stock didn't do a lot for a long period of time, but companies that use the internet and leverage the internet like Amazon did phenomenally well, did great. Is this the same thing, Jesse, when it comes to AI? Like we've got Nvidia helping create it, but we really need to be focused on AI 2.0.

• 33:07Speaker 06

  Maybe. And, and that's where I guess the, the honest answer, Joe, is I don't know enough about AI infrastructure, AI build outs, how companies are really going to start using AI. I am not the AI expert per se.

• 33:21Speaker 03

  Oh.

• 33:21Speaker 06

  But do I want to try to own these companies in some reasonable proportion? And am I, am I accepting of the fact that going, going back to Joseph's statistic, that the overwhelming majority of them might underperform? They might be the haystack and, and that's okay. I'm going to own the haystack. I'm also going to own the needles too. I'm going to try to do that. I am okay with that. It's, yeah, I don't know. And, and I think it's okay to not know. And I think for the stackers out there listening who say, we have no idea. Am I owning, you know, bread.ai? Maybe. But hopefully you're also owning amazon.ai too. And, and that's a good thing.

• 33:52Speaker 03

  In the second half of today's show, I'm going to keep asking Jesse Cramer to predict the future. He's going to continue to say he can't, which is so annoying. But we haven't heard Joseph's thing that's in the zeitgeist. And Joseph has been interviewed by a lot of people that are trying to connect history to today. We're going to find out his after the break and a couple more when we come back to Palm Springs and the Creator CPA stage at FinCon.

• 34:20Speaker 03

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• 35:46Speaker 03

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• 36:26Speaker 03

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• 37:06Speaker 03

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• 39:31Speaker 03

  Hey, this is Andy Hill from the Marriage, Kids and Money Podcast and.

• 39:34Speaker 07

  When I'm not singing Disney karaoke songs with my kids at home, I'm stacking Benjamins.

• 39:41Speaker 03

  All right. We talked inflation. We talked AI. Joseph Moore, you're going on all these interviews and everybody has the sexy question.

• 39:51Speaker 05

  Oh, yeah.

• 39:51Speaker 03

  And I'm wondering where all the sexy questions tend to end up overlapping.

• 39:58Speaker 05

  So where do I hear the zeitgeist? Because everybody's on the history guide and they're like, well, tell us a story from the past, you know, like, hey, grandpa.

• 40:05Speaker 03

  Yeah, exactly, grandpa. Make this make sense to me. So the thing I get is a lot is railroads. What?

• 40:12Speaker 05

  Yeah, railroads are huge right now. And what I mean by that is everybody's grasping at history to find some analog to the AI build out. And there's not that many times that this much infrastructure build out happened at the same time with a universal agreement that this was the way of the future and everybody's locked onto railroads. Like this is their mind is like the one thing they're going to. And then, you know, some books have come out on this that have gotten a lot of traction. And so people are like, oh, great. So if I just study railroad history, I know what happens with AI. And that might not be a great strategy. A lot of analogues to a huge rollout, a huge, a massive build out, huge portions of GDP going into an industry. All that holds. What doesn't hold it, back to

• 40:54Speaker 05

  my point of it's always different. This time is always different. We're doing all this. We're not on the gold standard. We have very different fiscal policy. We have very different politics. Like, there's a lot of things that are underlying this build out that don't map easily to the railroad build out. But everybody wants to ask me, so, this, just like railroads, right? Like, we're gonna have 1873. It's just like, oh, we're gonna have this huge depression from AI, from the, it's all gonna collapse, just like 1873. And I have to tell them, tap the brakes. This isn't 1873. How many of you go to work in a wagon?

• 41:24Speaker 03

  But still, are there, are there some things we can glean, looking at Union Pacific or the Golden Spike or?

• 41:32Speaker 05

  There are. There are plenty of lessons that you can take away in terms of the way human beings interacted with the bold new future that was right in front of them. But they're generally not the lessons people grasp onto. So for instance, if you actually look at the timeline of how long it took, not just for all that infrastructure to build out, but for how long it took for an average person's life to be changed by it. It's like two decades. So you kind of kept living the same life you had always lived. We grossly underestimate the choke points in technological transformations for when, and think about the internet. There was an internet well before many of us were doing most of our lives online. And many of us who lived through the 80s, you know, through the 90s and early 2000s, remember it was more of a novelty item. And now it's the rails on which the

• 42:16Speaker 05

  entire economy runs often. And so I think there's this tendency to over extrapolate. There was change. Everything happened in an instant, the booms and the busts. And they tend to take their time to get here. The future takes its time to get here. And people aren't indexing for the time constraints and the choke points. Now, are there lessons? Sure, there are lessons. One of which is that the real way to make money in a technological revolution tends to be working in it, not investing in it. Like, you make more money investing on the technology, being somebody who's built part of the build out. I point out to many people, like, if you have an electrician's license right now, you are in high demand. You can make $200,000 working on an AI, you know, build out, and then get offered 30,000 more to drop your tools and go to another job site. So it, you're gonna

• 43:00Speaker 05

  make a lot more money building this out than you are trying to predict which of these railroads or AI companies are gonna be the winners.

• 43:07Speaker 03

  That's so interesting, because Paula, you have a course in negotiation. And one thing that you and I have experienced is a lot of people want their portfolio to do a lot of the heavy lifting. They want their portfolio to do better. And yet, often, the opportunity to make money, make more money, is right in front of them. And if they focus as much on their career as they did on their investment portfolio, it might end up being a better life for them.

• 43:32Speaker 04

  Absolutely. So I, increasing your income is one of the strongest levers, because that is directly inside of your, your zone of control, your locus of control. We can't control what the stock market is going to do. We can't control the broader macro economy, but we can control how much, to a large degree, we can control how much money we make. The more you stay inside of that locus of control, over time, the greater that locus of control grows, right? So the more you focus on what you can control, the more that what you can control expands over the years.

• 44:06Speaker 03

  Jesse, how often do you go into a meeting with people after you help them do a financial plan, and you tell them, this is an income problem. You just need to make more money?

• 44:17Speaker 06

  Uh, fair question. It depends, I guess. Because, right, is the idea that for some people, their goals are just simply outpacing their earnings, their income? Yes. In some cases, the answer is yes. And, and people will come in and say, you know, I'm a nurse, I'm married to a teacher, and we want a $4 million house, we want to retire by 42, and we want to go move to the moon where there's new land.

• 44:41Speaker 03

  Yes.

• 44:42Speaker 06

  Yeah, okay, it's an income problem. Or it's just a, a matter of-

• 44:45Speaker 03

  And you're like, here's your financial plan, and here's your ruby slippers, just click these together three times?

• 44:49Speaker 06

  If you live to 180 years old, you'll be fine. You'll be fine. And so, income, the nice thing is, income is something where, it's kind of funny, I feel like it's both, it can be hard to control in the short run, right? It's hard to say, just go double your salary in the next week. It's hard to control in the short run. But something that I think, you know, Paula can attest to, and like, I see, and like, I hear some of the stories where it's like, if you put together a mid to long-term plan, maybe it takes you a couple years, maybe it takes you five years, to actually affect your income in a positive way, it's very, very possible. And I think a lot of people maybe don't realize that. It took me a while to realize that, that like, oh, I could kind of pave my own path

• 45:30Speaker 06

  and actually start to really increase my income. It's not easy per se. It takes some time, but it is very doable. And it's, and it's within your control, your locus.

• 45:39Speaker 04

  Locus.

• 45:40Speaker 06

  Love that word. Love that word.

• 45:42Speaker 04

  Locus. It came from Seven Habits of Highly Effective People by Stephen Covey.

• 45:47Speaker 03

  A book I never quote. I feel like I quote that book nonstop, to an annoying degree.

• 45:52Speaker 04

  Yeah, it's one of the most important books I've ever read.

• 45:55Speaker 03

  But at the time, I didn't think so. At the time, I was like, yes, it's okay, whatever. Pick up one end of the stick, you pick up the other end, big deal. Sharpen the saw. Yeah, okay, I'll do that. Joseph, it's interesting, what a lot of people worry about with AI, is they worry about their income. So while we're talking about income, I think we worry about the 1930s, right? We worry about this Great Depression when so many people didn't have jobs. What really happened in the Great Depression? What really happened during this timeframe? I mean, we've read The Grapes of Wrath, and, you know, we kind of see the stories of Jack Kerouac, you know, people just trying to get part-time jobs. If we can't correlate to railroads, can we correlate to, maybe there's gonna be another Great Depression?

• 46:37Speaker 05

  Oh, I am not on that particular train.

• 46:43Speaker 05

  He's here all week. Come for the financial advice, stay for the dad jokes. So, first of all, the Great Depression is yet again, has a whole lot to do with fiscal policy than it has to do with anything about the infrastructure or technologies that were happening at the time. Yes, a lot of pain in that, you know, what had happened. A lot of people did lose their jobs. There was a lot of suffering. You know, read thy Steinbeck is one of the lessons. However, here's some things that we don't remember. Most of the technological transformations that we live with today and assume are just normal, we often associate with the 1910s and 20s, refrigerators in your house, everybody having a car, everybody having a telephone, all these things. Actually, all of those were, were single-digit technologies. Maybe the car, not, not the car, the car had already got in double digits. But most

• 47:28Speaker 05

  of those technologies were single-digit technologies in terms of percentage of households that adopted them. It's in the 1930s that most Americans started to acquire those things, refrigerators being the most famous example. You went from having either no way to keep food cool, or having a literal icebox with a block of ice in it delivered by horse, by the end of the 30s, by the end of the Great Depression. Most people have refrigerators. And how did that happen? Well, everything got cheaper. We forget that there's this, this other side to an economic contraction, that things get cheaper. And as things got cheaper, people adopted them more.

• 48:00Speaker 03

  It's a healthy part of the economy, you're saying?

• 48:02Speaker 05

  Right.

• 48:02Speaker 03

  I mean, not in the moment. The moment is sucks.

• 48:04Speaker 05

  Yeah, you don't want to live in 1935.

• 48:06Speaker 03

  Right.

• 48:07Speaker 05

  But nonetheless, like, we actually can look back historically, and well, this is when most Americans started to adopt these technologies we live in today. You know, you look at the AI, I'm sorry, the internet boom. I think most people actually started to use the internet in a productive, non-cute way. The first thing I did on the internet was look at a picture of Paris, France. Because I was in rural South Carolina. And I was like, oh, look. And it was like, remember those pictures that would like refresh, and it would like, and it was like, every five minutes, it would refresh. You're like, I'm looking at Paris, I think. They could be making up. I have no clue. But like, we weren't using it for-

• 48:38Speaker 03

  You go get coffee and come back and your picture's finally there?

• 48:40Speaker 05

  Yeah, exactly. So it was after the dot-com bust that most of us started to use the internet in a productive capacity, because everything got cheaper. And so a lot of times when you see these, these build outs, you'll see a point where it contracts back. There's a lot of losers if you're in the investment space of that. Well, let's be honest, most of those stocks are not publicly traded. Those are the real AI companies. Well, they may be soon. But like, that contraction is for the investor side. But for the user side, that's when actually most people are able to adopt it and use it productively. So as a historian, so long as you're in a good financial place, if you're a stacker, you're probably in a decent financial position. Let's be honest. Like, you're gonna be okay. That's probably the time in history that you'll see most of the actual AI adoption

• 49:25Speaker 05

  occur. Right now, there's a stat came out, I think just this week, companies that are adopting AI at the fastest rates are hiring more than other companies.

• 49:33Speaker 03

  Oh, that's interesting.

• 49:34Speaker 05

  So like, actually, they're still haven't figured out how to make AI replace the workers. They are trying to figure out how to use AI to make their workers more productive. We're not in the phase yet that it's 1929.

• 49:44Speaker 03

  Yeah, I haven't, I haven't found, you know, we talk about these productivity gains, and so much has been written about, really, haven't been huge productivity gains. I do feel like, though, Paula, AI hasn't made me more productive, but it has made my work crisper, a little better. Have you?

• 50:03Speaker 04

  I think it has allowed us to do more, which I guess is the definition of productivity.

• 50:07Speaker 05

  Yeah.

• 50:08Speaker 04

  But.

• 50:09Speaker 05

  But the stats don't, don't bear out there yet.

• 50:12Speaker 04

  I mean, I, speaking, the broad aggregate stats do not show that in, in mass.

• 50:18Speaker 05

  Yes, but for you.

• 50:19Speaker 04

  Yeah, but for us specifically, I think the AI has allowed us, it has accelerated many of our processes. Some of those like very time consuming and therefore expensive processes.

• 50:32Speaker 05

  Yeah.

• 50:32Speaker 04

  Because time is labor costs, but then rather than pay less for labor, it actually means that we're, I'm, I'm still paying just as much, actually a little bit more for labor costs, like continuing to hire and continuing to grow.

• 50:46Speaker 05

  You're translating this into more output.

• 50:48Speaker 04

  Exactly. Yeah. It's all translating into more output.

• 50:51Speaker 05

  That's interesting. It'll be, it'll be interesting to see what happens with GDP then over time, right? And that seems to be human history, isn't it? That we, we just take these gains and we use it to do more. Like, remember when, at least when I was young, people were like, oh, the future, we only got to work 10 hours a week or 20 hours a week. I feel like now we're on the average person's more on the wheel, working more and more and more.

• 51:13Speaker 04

  Right. Well, I think there's the, what is it Parkinson's law? Work expands to fill the time you give it.

• 51:18Speaker 05

  Yeah.

• 51:18Speaker 04

  And I think there, it is very, to build and to create is human, right? There's a very, I think, intrinsic human drive to, to do things, to make something.

• 51:28Speaker 05

  To create colonies on the moon.

• 51:30Speaker 04

  Exactly, exactly. And so as certain things become less time intensive, uh, we fill that time doing other more productive things or differently productive things.

• 51:42Speaker 06

  I was thinking though, Joe, about this whole AI build out and isn't there, Joseph, you probably know more about this than me, like airlines. You look around the country, we've got airports everywhere. We've got thousands of planes flying everywhere, every day. It took me, you know, half a day to go from dinky little Rochester to dinky little Palm Springs. And yet airlines as an investment are kind of bad and historically have been really bad because they're so competitive that there's no profit to be had because everything gets reinvested to be more competitive.

• 52:09Speaker 05

  Right.

• 52:09Speaker 06

  And, and it's worth asking, like, again, going back to this idea of, are you going to make money investing in AI? Or rather, is it like being part of the picks and show, like, for all we know, all these AI companies are going to out compete the profits away from the industry itself. And it, it won't end up being a particularly novel investment. Like, who, who knows?

• 52:27Speaker 05

  I'm very close to committing to that narrative, exactly what you just described. The idea of like a private, but what are, what are railroads today? What are airlines today? They're functionally privately held utilities, right? They're, they're, we all just ride their rails. But we choose to have them privately owned so that they're run in a more cost efficient way. So that, you know, all, all, for all these reasons. We forget that if AI becomes so productive, right, that it changes the GDP statistic so that we have so much more productivity. Most of the gains from those productivities in previous technological revolutions went to consumers. Right? They went to actually making the thing accessible in the first place. There was an era, I don't know, I, I was raised in the rural South.

• 53:09Speaker 05

  When my parents were growing up, you got oranges for Christmas in your stocking. Because for their parents, you didn't get oranges, but literally once a year at Christmas, because they were hard to get. Because there wasn't a road to Southern Florida. It didn't exist. And then the railroads put it there and you could get citrus out of Florida before it rotted.

• 53:29Speaker 03

  I was, I was so excited to get grapefruits.

• 53:32Speaker 05

  Yes, that was, yeah. So you would get these things because in an earlier generation, it was new. All right. Now, like my kids, like orange, big deal. There's thousands of them at the store. We forget that most, the access to things you didn't have before comes and the cost of that access goes down over time, often dramatically. And most of that gain goes to the consumer. So if there's less people being employed in the process of getting that access to you, because it is getting cheaper, that frees up money in GDP to go into these new things like, what's a YouTuber? Like, let's go back to 1990 and describe the idea that some people will be.

• 54:06Speaker 03

  A podcast.

• 54:06Speaker 05

  A podcaster. Um, and let me explain that this will be a viable thing people can do. And it actually can be of huge benefit in people's lives. These are things that will come out of that slack that gets freed up in the line and you'll have all these new industries. And all these new things people, these things we will do with that free time that you're talking about Parkinson's law. So I think that people will fill that time with all the slack that it creates. If it's the boom everyone predicts it will be, I think it's good for the average person.

• 54:32Speaker 03

  Paula, pick another one of the seven things that you gave us earlier.

• 54:35Speaker 04

  Ooh.

• 54:37Speaker 03

  We want to talk interest rates?

• 54:39Speaker 04

  Yeah, let's talk interest rates. Why not? So the, the Fed, uh, just hiked interest rates.

• 54:42Speaker 05

  Yeah, as we record this.

• 54:44Speaker 04

  Yeah, exactly. So, uh, interest rates are up another 25 basis points. So essentially it creates a goal for, if you are already a homeowner and you purchased your home during the Zerf era when interest rates were, were quite low, you likely have a mortgage rate on your home that is a two handle, a three handle, maybe a four, low fours.

• 55:03Speaker 03

  What does that mean? People don't know what you're referring to.

• 55:05Speaker 04

  Oh, uh, two point something percent.

• 55:07Speaker 03

  Gotcha.

• 55:08Speaker 04

  Three point something percent.

• 55:09Speaker 03

  Okay, yeah.

• 55:10Speaker 04

  So you likely have a fairly low interest rate on your mortgage if you got it in, you know, prior to, uh, 2021.

• 55:20Speaker 03

  Yeah.

• 55:20Speaker 04

  That means that, uh, you likely have a golden handcuff scenario right now where you.

• 55:26Speaker 03

  Can't move.

• 55:27Speaker 04

  Or don't want to move because if you were to move, the fact that home prices are higher than they were and the fact that mortgage interest rates are now higher.

• 55:36Speaker 03

  Cost of money so much more.

• 55:37Speaker 04

  Yeah, exactly. So, um, what that creates is, is a situation where people feel that they don't have mobility. And if people don't have mobility, then you feel like you can't move for a job. You can't move to take care of elderly parents. You feel this stuckness because you are literally, uh, you have the, the feeling that you are stuck in your home. That I think is responsible for a lot of the, the pessimism out there right now. You know, we've got like a booming stock market. We've got a great economy by every standard economic metric. And yet people feel very pessimistic. So how do you square the low consumer sentiment and the, the overwhelming sense of pessimism with the positive economic data?

• 56:19Speaker 04

  I think one of, there are a lot of reasons for it, but one of many reasons is a feeling of a lack of mobility tied to the golden handcuff scenario that incumbent homeowners are facing.

• 56:28Speaker 03

  Let's zoom out. We like to zoom in, right? On the issue today, Joseph, uh, interest rates historically high or low? Based on your research?

• 56:37Speaker 05

  Historically dead center normal, almost. I mean, if, if not a hair low, but nobody wants to hear that. So the other thing I'm hearing in the zeitgeist is this, when will my normal come back? Right? Because everyone for, for this generation and maybe two generations has lived with having four to 5% uh, in, you know, rates as the going rate is kind of the normal. And they want to know when it's coming back. And so you had a lot of people who thought they were really smart saying, I'm going to wait for rates to come back down. Uh, rates will come, oh, don't worry, rates will come back down and they don't. And this, by the way, happened in the sixties and it happened in the early seventies. You had all these people saying rates will come back down. The next thing you know, they were 9%, 10%, 11%. Then people panicked to the, they flipped the switch to panic mode.

• 57:20Speaker 03

  Oh, Lord.

• 57:20Speaker 05

  Oh no, it's outrunning me. I have to go grab it now. And so we see a lot of this, we've, that does have a lot of historical precedent. And I'm hearing a lot of people who are starting to change that, change their language from, when will it come down to? How far will it get ahead of me if I don't jump? And so I, I'm hearing a lot of that anxiety as well.

• 57:39Speaker 03

  We did a lot of talk today, Jesse, on trying to predict the future, which you annoyingly don't want to do. But how often do you got to talk clients off the ledge with this? You know, stop trying to predict the future and deal with things the way they are today?

• 57:53Speaker 06

  Well, the act of financial planning is so forward leaning. I mean, it is, it's looking decades out into the future. And the thing that I think about is good planning or just these kinds of conversations that we're having right now. All we're trying to do is put a bracket on your range of outcomes. And, and so through the act of smart planning, maybe using some historical context like Joseph would do, or, or, or looking at interest rate numbers and, and think like, if we can just try to bracket the problem and understand the range of, of potential outcomes, that tends to put people at ease. It's not that we're predicting a precise future, but rather just trying to put a box around it. And, and that's, I think, the best you can do. That's the best you can do unless your crystal ball is, is working like yours, Joe. But not all of us have that, that luxury.

• 58:36Speaker 05

  Or if you had bought bread.com.

• 58:37Speaker 06

  That's right. If you were a bread.

• 58:39Speaker 03

  Look at how wealthy you'd be.

• 58:40Speaker 06

  You'd be on the moon.

• 58:41Speaker 03

  So wealthy, nobody would even know what you own. Great discussion, guys. Thank you so much for joining me. Jesse Cramer, what's coming up at the Personal Finance for Long Term Investors podcast?

• 58:51Speaker 06

  Got some more AMA episodes coming out soon. I'm trying to think of any big topics that, oh, I've got one, one, uh, it's called Billionaire Misconceptions.

• 58:59Speaker 03

  Oh.

• 58:59Speaker 06

  I guess I've got a few different questions over time where someone's like, I've heard that billionaires don't pay their fair share of tax. Is that true? Some of them are true. Some of them might not be true. And I explain what's going on, but it's, it's kind of a fun theme episode, billionaire misconceptions.

• 59:10Speaker 03

  That's awesome. Joseph Moore, thanks for joining us. And the book, uh, How to Get Rich in American History, available everywhere.

• 59:17Speaker 05

  All the Amazons.

• 59:18Speaker 03

  It's awesome. What's your favorite review of the book?

• 59:21Speaker 05

  Oh my goodness. Uh, my deep gratitude to everybody who takes time to read the book. Honestly, even an Amazon review, like that means the world to me. Somebody took the time to, to think about my book, spend time with my ideas. I will say Jason Zweig, the Wall Street Journal, said it was the funniest finance book since Where Are the Customers' Yachts?, which was written in 1940. So I'll take being the funniest finance book since 1940 as a, as a compliment.

• 59:42Speaker 03

  Never heard of that guy. I don't know Jason Zweig. No, I'm kidding. That, that is awesome. When Jason talks about your book, I think that's, that's.

• 59:48Speaker 05

  It was, it was profoundly humbling.

• 59:50Speaker 03

  That, that might be good. Paula Pant, what's going on at Afford Anything?

• 59:54Speaker 04

  Uh, on the Afford Anything podcast, we've got an interview, uh, for our first Friday episode, for the first Friday of, well.

• 1:00:01Speaker 03

  October?

• 1:00:01Speaker 04

  October. We are actually going to be doing something a little bit different than our norm.

• 1:00:05Speaker 03

  Ooh.

• 1:00:06Speaker 04

  So rather than our standard macroeconomic, here's what happened in the jobs report episode. We'll briefly talk about the Fed governor's, uh, decision to, to raise interest rates. And after that, we're going to go into an interview with Rob Berger.

• 1:00:19Speaker 03

  The Rob Berger.

• 1:00:20Speaker 04

  The Rob Berger. So.

• 1:00:21Speaker 03

  What an awesome man.

• 1:00:22Speaker 04

  We recorded that interview right here at FinCon. He's been covering personal finance ever since his days of writing Dough Roller in 2007. So he's been covering this for 19 years. And so we have a discussion similar to what we did today, like over the last 19 years. What's changed and what stayed the same? What's timeless and what's timely?

• 1:00:39Speaker 03

  And Rob is such the voice of reason.

• 1:00:42Speaker 04

  Absolutely.

• 1:00:42Speaker 03

  Just such the calm, cool, collected, that guy.

• 1:00:44Speaker 04

  Exactly.

• 1:00:45Speaker 03

  If I could be Rob Berger, man, that'd be great. All right. Thank you so much to Steve Stewart for helping us out. Steve is always right there in the background, but today we get to be face to face with Steve. Thanks to Steve. Thanks to Kevin from our team for being here with us. Thanks to my old friend Gene for hanging out with us. Gene and I go way back now like an hour. Come to FinCon. If you're a creator, please do. Thank you so much to Philip Taylor for letting us do this. We'll see you next time. Doug, what should we have learned from today's episode?

• 1:01:12Speaker 02

  Well, Joe, here's what we should have learned. First, take some advice from the team. Investing, it's always a long game. And second, are things different this time? Well, as Joseph Moore points out, it's always different. That doesn't mean, however, that your reaction should be different. But the big lesson?

• 1:01:32Speaker 02

  Don't let Joe Galavan off to Palm Springs and leave you alone in the basement. I mean, sure, it sounds good. No noise from him and plenty of time to figure out where OG hid the Cheetos. But quickly, it turns out that, hey, take care of things in the basement really means organize the Nintendo cartridges while I'm gone. Not cool, Sehi. Thanks to Joseph Moore for joining us today. Find his new hit book, How to Get Rich in American History, wherever books are sold. We'll also include links in our show notes at stackingbenjamins.com. Thanks to Paula Pant for hanging out with us. You'll find her fabulous podcast, Afford Anything, wherever you listen to finer podcasts. And finally, thanks to Jesse Cramer for joining us.

• 1:02:16Speaker 02

  You'll find his personal finance for long-term investors, or as we call it, the Filthy Podcast, wherever you're listening to us now. Go on and subscribe. 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.

• 1:03:01Speaker 02

  I'm Joe's mom's neighbor Doug, and we'll see you next time back here at the Stacking Benjamin Show.

• 1:04:03Speaker 03

  All right. Joseph, what'd you have for breakfast?

• 1:04:06Speaker 05

  I had eggs. I had so many eggs. And the reason for the eggs is because of Paula, because I was on Paula's show.

• 1:04:13Speaker 03

  That's why I eat eggs, too. I have no idea where the hell this is going.

• 1:04:16Speaker 05

  Okay, it pops up on the YouTube, you know, under my channel. And the TV, the family TV, has my YouTube on it. So my six-year-old looks up and says, Daddy, you're on the YouTube. And I said, yes, because there's Paula looking very smart and there's me and my six. She says, you look like a dumpling. And I was like, what do you mean a dumpling? Because I had like this shirt that I obviously did not fit anymore that I was trying to squeeze into. And she was like, you look like a dumpling. And she meant it as a compliment. So now I am on a diet. So I had so many eggs.

• 1:04:43Speaker 03

  A friend of my kids came over for a playdate when they're like six. At our house, we lived in this rental house, 800 square feet. This girl comes over and she goes, oh, this is just like our cottage.

• 1:05:01Speaker 03

  Like, thank you.

• 1:05:02Speaker 05

  You have such a nice vacation home.

• 1:05:03Speaker 03

  Yes, yes. My domicile that houses four of us. Thank you very much.

• 1:05:08Speaker 05

  Love it.

• 1:05:09Speaker 03

  Jesse, do you eat eggs?

• 1:05:10Speaker 06

  I do. Eggs, oatmeal is part of my usual breakfast routine, I'd say, and Greek yogurt. I'm a big Greek yogurt fan. Yeah, a lot of Greek yogurt.

• 1:05:19Speaker 03

  I did not like Greek yogurt until I went to Greece. And Greek yogurt with blueberries and a crap load of honey.

• 1:05:26Speaker 06

  Yeah.

• 1:05:26Speaker 03

  Just a bunch of honey. I heard that makes it more nutritious, like adds nutritional value.

• 1:05:31Speaker 02

  Honey's not that bad for you, you know?

• 1:05:33Speaker 03

  No, it's good.

• 1:05:34Speaker 04

  It's got nutrients, micronutrients.

• 1:05:36Speaker 03

  Bees make it, come on.

• 1:05:37Speaker 06

  Exactly.

• 1:05:38Speaker 03

  Last thing I'd like to say on the after show, one of us is color coordinated.

• 1:05:42Speaker 04

  Yes. Yeah, my shirt matches my nails, which also matches my phone case. Yeah.

• 1:05:49Speaker 03

  That's incredible.

• 1:05:49Speaker 06

  And matches Joe's microphone wire.

• 1:05:51Speaker 03

  Yes.

• 1:05:52Speaker 06

  Which I think from the camera's point of view is another plus.

• 1:05:54Speaker 03

  That's what she was really trying to do, was match the microphone wire.

• 1:05:57Speaker 05

  This is why she is Paula Pant.

• 1:05:59Speaker 03

  That is why.

• 1:06:00Speaker 05

  This is, this is why afford anything is what it is. We don't think of these details.

• 1:06:04Speaker 03

  If someday Stacky Benjamins could be what afford anything is.

• 1:06:07Speaker 04

  You know, I forgot to wear them, but I also do have matching earrings. I packed them. Wait a second, are they in my wallet?

• 1:06:16Speaker 05

  And welcome to the fashion episode.

• 1:06:17Speaker 03

  I'm so glad.

• 1:06:19Speaker 05

  This is the health and wellness slash fashion episode of Stacking Benjamins.

• 1:06:23Speaker 04

  I did, I put them in my wallet.

• 1:06:25Speaker 03

  Oh, my God, you didn't wear them.

• 1:06:26Speaker 04

  Yes, so, okay, no, so I can put in the matching earrings.

• 1:06:29Speaker 05

  But then you won't hear us, which might be an upgrade.

• 1:06:32Speaker 02

  And scene.