How finance shapes the world

30:31So how's that been going, mate? They're sacked. So drama sorted. They're a big corporate firm. They didn't really reply to my emails very quickly, like took a week or two at times. And they charged me way too much. I mean, I've got pretty simple taxes and they were charging me thousands. They saved me some money, but yeah, I had to move on. Slow and expensive. Pretty much, yeah. This is one of the reasons that we're really happy to be partnering with TaxApp. It's a tech platform that makes self-assessment simple. Whether you're self-employed like me, a freelancer, or a director like Damo, big dog.

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31:33That code is MONEY, M-O-N-E-Y 1-0. So Mr. O 'Carolet, I hear you are a salesman. Elite salesman, yes. One of the best, they say? I've got a little bit of experience in the game, yeah, I could say. Done a few deals. A bill, a bill. What would your compliance team say about you? They will say that I am always nagging them and that essentially I just have beef with compliance. I love the team. Compliance slows down all my deals because every time I get to the finish line, they've got to check documents, KYC, GDPR, and it's just a nightmare. It slows the deal down by like two, three weeks. It's always on both sides as well, isn't it?

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32:45If you're a business that needs to prove security and compliance, visit Vanta.com forward slash making money to sign up for a completely free demo today. That's Vanta.com forward slash making money. There's a link in the description, though, so you can just click that. One of the things that's clear is that markets have kind of grown with modern nation states. So the two of them are linked. and that goes right back to the beginning of the London Stock Exchange. So, I mean, this is back in 1697 is the sort of official first date of the London Stock Exchange. But it's just a cluster of traders at this point in a coffeehouse on Exchange Alley.

33:34But what's happened elsewhere in the country? We've had a civil war. We've had a succession of kings, and then all of a sudden we get this new monarch, William, coming over from Holland, and he agrees to something that resembles a democracy. So all of a sudden, the parliament's got to play by rules, and it can't just go taxing folk and all of these sorts of things. So the government is short of money because it's constantly at war with France and various other people. There's lots of merchants in London who have got plenty of money because mercantile classes have emerged. And yet most of their business is trading with France, which they can't do because there's a war on.

34:21It's kind of a lot of money sitting in London. How do we get some of that? So what the government did is they, in exchange for kind of monopoly licenses to do certain trading things like the East India Company, the East Africa Company or what have you, these firms, these early corporations, joint stock corporations, which are pretty like modern multinationals actually, they lent the government massive sums of money. And then they issued stock, their stock, to the traders who traded it into these merchants. So it becomes like a pipeline of capital going from the merchant classes through the stock of these joint stock corporations and into the coffers of the government.

35:14Are they like government bonds? Well, yeah, kind of. I mean, the problem was that the government's credit rating was really bad, and they couldn't issue bonds. No one would lend them any money. They tried annuities and lotteries and this kind of thing they didn't really work so so they they they sort of they lent the money eventually one of these organizations is the bank of england and you know i think i think these things become formalized over time but the point is you know what did the east india company do what was its very slave trades well well moving moving there were logistics yeah and they were they were kind of param you know military industrial colonizers colonizers yeah What did the East Africa Company do?

35:55Is that the slave? Is that the slave trade? They ran the kind of slave factories down the coast of Africa that gathered people up and processed them. So these are really egregious firms pursuing really kind of, you know, some of the dirtiest episodes in British history. and they're intimately connected with the growth and the establishment of the stable state and the empire. Yeah, exactly. So they were basically ripping money out of the rest of the world, bringing it back to the UK and through this mechanism, feeding it into war and empire. Yeah, exactly. And you see this kind of over and over again.

36:41So the Indian Railways is a good example because it's one of, you know, if you ever talk to like an ancient enthusiast for empire, they say, well, at least we put the trains in India. And, you know, trains are a really stupid thing to put in India. They're not an appropriate mode of transport for the subcontinent. Why? Well, just geographically, canals would be better and, you know, kind of engineering reasons and what have you. But they were the popular thing in Britain. Everyone needs a railway. Everyone needs a railway. So, you know, British engineers went out and they built railways and they built railways using British capital that was effectively underwritten by the Indian government and therefore the Indian taxpayer on terms that were so egregious that it was really only properly paid off in the 1960s.

37:33So this is like political military dominance being translated into kind of stable long-term investment returns for UK investors. And this is one of the things that is in the bones of finance. It's good at cleaning things up. You know, it's good. It can take, you look at the credit crisis, you know, it can take the mortgages of kind of poor folk and black folk and immigrants and all these high credit risk people. And it can somehow transform them into AAA rated, clean things. Safe investments. Safe things that can be traded and punted around. And there's this, again, again, this process of sort of, you know, alienating and capital doesn't make much return when it's tied up in mucky industrial stuff and it's risky and what have you.

38:28Much better to clean it up and just let it fly around under its own steam. Yeah, you have a wonderful quote about markets and this idea that actually they're not fixed, they're not set rules, we can change them. And then you say that the exchange is the factory of the finance, and it can either be a dirty industrialist nightmare, or it can be like a utopian building. And it's kind of, is it easy just to be dirty though, like you say, and clean things up? And HSBC is an example, right? they seem to always be moving money for shady people. I think they had some cartel deals at one point. Cartel deals, slave deals.

39:07Policy schemes. I mean, there was stories of people just turning up with wheelbarrows of gold and dumping it in Dubai and then being like, oh yeah, that's fine. Now you own a house in Mayfair. Congratulations. I think, you know, this is somewhere in the bones of finance is a tendency to do this. The book begins, I think, I think it's towards the end of the podcast actually the way it worked out but the book begins with this discussion of slaving credit and you know this is really going back to the 17th early 18th century so we all know the passage of the Atlantic Triangle you know the goods left, manufactured goods left Liverpool they went down to Africa they were traded for people these people were shipped across the Middle Passage it's a sort of hellish six weeks and many of them died and drowned and all the rest of it wraps running around the boats oh just claustrophobia, madness if you see the pictures it's impossible to imagine under the deck and stuff crazy and then they were sold at the other end And then that cash is turned into cotton mostly, which has been picked by slave labour and then it's shipped back to Liverpool.

40:31Right. So that's the trade. But the problem with that, apart from all the many problems, you know, kind of to do with the whole thing. But if you're a trader, it's slow, it's risky. These slaves, you know, they get sick, they rebel if they have the opportunity. You may not be able to get a good price for all this kind of thing. it would be much better if capital could just kind of circulate a bit quicker. So what they started doing is writing bills of trade, which are effectively kind of IOUs with a discount on them, and bank transfers, really early bank transfers. And these can move around much quicker.

41:15And then when you get to the other end, then you cash it in at a bank. And so in Liverpool, the banks in Liverpool, Liverpool became one of the finance capitals of the early modern world because it had all of these banks that were trading credit notes that were based on the people that were being transported. And I mean, I can't imagine a more kind of egregious instance of cleaning up than this, even in the rich array that the history of finance provides us. And of course, the returns, therefore, the capital can circulate faster. The returns are more widely available. The slaving factories in Africa started taking these IUs, which are effectively banknotes of a sort.

42:10And then they instituted a kind of cowrie shell-based currency for the inland trade. So the whole trading structure, the economics of the trading structure, the financing of the trading structure is kind of transformed by this innovation. And the result of it is that lots of fortunes were made in Liverpool and around in finance, not in slaving. Nice way of rebranding it. Well, exactly. So, you know, there's this kind of family history. One of my distant ancestors was MP for Liverpool and voted against slaving. It was a kind of family history of having this abolitionist in the background. But he was a banker, right?

42:54And, you know, what did he bank? What was the money? There's only one game in town. And the fact that he was a financier is neither there or there. It's just dirty money. Fortunately for me, he went bust and lost it all. So I don't have kind of liberal guilt. There's still that money sloshing around today. there was there was reparations for the financiers and the people who lost their businesses because of the there was no money for the slaves it was for the people that made all the money it was like oh you need money because you lost your business yeah yeah and and eventually that that the that huge payout i mean it was a payout um equivalent to the kind of payouts after the credit crisis um they bailed out the slaves they bailed out the slavers and and that payout was sitting in the national debt until 2015 or something like that really recently did has anyone tracked that money does do they know where it is today um there is a quite extensive project of who got it um whether that's then been when and it's it's probably publicly accessible you've i think it's um london university project but um but you can find it on on google look at that would be fascinating Yeah, yeah.

44:00Well, I had a look and I was like, oh, phew, you know, I'm clean. I've got no money. No, but it's crazy to think that they, and the finances cleaned it again and again. And you might have a landowner, say the Grovesners, they might, everyone might be like, oh, they're in property. But you could trace that back to actually it was slave money. And they bought central London with it. And, you know. Yeah, yeah, yeah. Do you think finance at its heart is dehumanizing, that it strips out the human element? We talk about people swimming in ship-filled rivers. We talk about slavery, all in the search of profit.

44:31Yeah, yeah, for sure it is. I mean, there are so many examples. I mean, the credit crisis, of course, is a fine example of these kind of things being transformed into kind of wonderful zany products with fancy acronyms and so forth. But actually, to start with, their wages on the ability of people to pay for mortgages that they fundamentally couldn't afford. And, you know, the book is full of these examples. It's laced into our kind of colonial heritage and so forth. So I think that it's in its DNA, you know. And it doesn't mean that finance is always already necessarily awful, but it's there, you know.

45:21and we need to be careful about it. Can it be better? I would hope so, yeah. How would you, I mean, fix it. Fix it right now. Fix it right now. It's a difficult thing.

45:36I think it would be nice if finance financed things. I think that's the short answer. I mean, you know, we're in an age of crisis and it would be good if we saw some traffic going the other way. Large-scale infrastructure projects in the UK need funding. Even just, I mean, I say every episode, I have bad internet. Like I have copper wire internet. And then like OpenReach are like, oh, it'll be three years before we install it or whatever, or two years. So you think these kind of projects that could improve the productivity of the UK, say, which we desperately need, don't we? How would you do that?

46:14would that be through taxation or would that be through loans or well this is this is this is the other thing and i think this is where it spills into a more political discussion because the other thing that's been normalized along with you know finance being this kind of neutral thing zone what what have you is this this idea that um all all of these kind of activities are better off done by private enterprise and and and commercial you know kind of commercial concerns that are therefore somehow tied to the stock exchange. Maybe it's not. Maybe actually infrastructure provision is too important to be left to private interests.

46:54But if these big trading floors and investment houses and banks that were making loads of money, shouldn't they, like you said, flow the other way? Shouldn't they say, okay, let's invest a bit in renewable energy. Let's just build one wind turbine for our company. Each company or each entity does something good for the country. Because you're saying there's a social human aspect to finance? Shouldn't someone just be like, okay, look, we've made like 20 billion last year. Let's build a wind turbine. Well, I mean, I suspect, you know, bankers are still people and they still have kids and, you know, they're still concerned about things.

47:29A lot of people and they are, you know, people are interested in new and different ways of doing things. And I think that involves shaking off some of the sort of intellectual and regulatory constraints that we talked about earlier, because these people are not necessarily free in terms of their, you know, their occupational requirements to do the things that they might like to as kind of concerned citizens.

47:58But, sorry, you said something else to you there. There was a second question. The structure of corporations itself is for the benefit of the shareholder. And if you follow that path, you always lead to them keeping the money and making more money. Yeah, but we're always talking about things like, oh, all these ESG funds and, oh, we care about the money. Yeah, but shouldn't they just say, okay, forget all these funds. We've made loads of money. Let's do something nice for the country. It's a noble, noble thing. I mean, you made some money. Give it away, mate. I haven't made enough yet. I don't have a house in Mayfair yet, mate.

48:28They'll probably say the same thing. But, you know, this is a political thing, isn't it? And actually, that's exactly what the super rich say. They say, look at our foundation. You know, look at all the good things that we're doing. Don't regulate us. You know, don't take our money away because we're using it to build some windmills. Trickle down economics. Something like that. These are at their heart political questions. And this whole thing that goes from, you know, kind of what's the, you know, the idea that markets are efficient and the best way of allocating capital and how we calculate risk and, you know, price options and this whole kind of intellectual project ends up, takes us to a place where we say, okay, you know, these people are super wealthy because they're shareholders in tech firms or what have you.

49:21then let them do good things. And maybe we have to rethink that. Maybe we have to rethink something fundamental about the way we organise our polity, I guess. And that then isn't a finance problem. That's like a democratic problem or an intellectual problem. Well, we'll save you from the politics, especially at this kind of time. It's a hard thing. So one thing, the markets seem perfect, but one thing that shows them for what they are, we look behind the curtain is when we get these big crashes. And I think the whole world wakes up then and goes, oh God, these guys don't know what they're doing or something's gone wrong.

50:00You started your career through the dot-com bubble. And you're very honest about yourself. You called yourself like plump and naive or something. I think they were the two words that applied to me age 25. I was plump and naive. Yeah. Can you talk to us about that time and what you mean and how you were part of the problem? Yeah. I mean, it was a crazy time and in retrospect, slightly embarrassing time. But, you know, 25 and I got a job as a writer on this new founded shares magazine, which was kind of like an investor's chronicle for, you know, slightly less well-informed people. it's boom time, bubble time, everybody's getting interested in the dot-com and the new technology and so forth.

50:54And I just, you know, I didn't know what I was doing. And it didn't surprise me. You know, I could find myself sitting in a private dining room in Rawls, which for listeners who don't know, is one of the kind of oldest and poshest restaurants in London, you know, eating eating fillet steak at somebody else's expense. And it never struck me that this was somehow kind of not okay or not right. And that this was part of the kind of fluff and the froth of the boom. And our job as journalists was to help information flow to potential investors who were going to part with their money and back some of these schemes.

51:40and some of them were more harebrained than others, but all of them had this particular kind of, you know, boom time flavour to them. They were just, they were raising pots of money for just ideas and we were part of that. And as well, it never occurred to me how orchestrated it was, partly because, you know, I mean, we just finished being a student, somebody's giving you a free dinner and lots of free booze. You're going to take it. You're going to take it? Nine out of 10 CUs are going to take it. You know, I only found out years later that the PR guys, the PR guys used to take us out to meet the managers of corporations, whatever.

52:25And they used to keep us there. It was a deliberate strategy. They would keep us at lunch until the late afternoon, you know four o 'clock half past four um because then we wouldn't have time to do any proper research you know we'd have to meet the deadline to hit the deadline and and we'd have a press release and a conversation they're all great they're all great amazing people give them all your money yeah yeah yeah this this raises another interesting question then of another industry that's like a bit of a mess media and this interaction with markets do you think markets exists without media no no i don't i don't think finance exists without it without the kind of performance of finance so you know finance is the theater of it the theater of it but you know what we're what we're doing now you know this is part of finance you know we're we're we're continuously kind of re-articulating it as this space as this zone as this thing that it's not you know we're not talking about making stuff it's not industry um and and and all the films we see and the stuff we hear or where the central banker stands up and says, you know, I will do anything it takes to save the euro.

53:40Or there was a German central banker used to say, I'm the Westphalian oak. You know, it's all theatre. And I think, no, finance wouldn't exist, not in the shape or form that we know it without that. We're kind of ridiculous, aren't we? Apart from monkeys, we'll pontificate in our numbers and our own greatness and all these things. and that so one thing that i've seen is media influence retail investors and this emergence of this retail class of investors that can influence markets and they tend to be quite um speculative or they like they like to play with them like game stop and things like this yeah what do you think about that because you've probably seen probably the dot-com bubble was the start of the retail boom right and they all got burnt yeah they were they go i don't know i I mean, it was one, I think we see like a history of these things.

54:33What's surprising is, so we can think about the bucket shops in Chicago and bucket shops were gambling shops where retail investors could go and just gamble on these new markets. This is kind of late 19th, early 20th century. And, you know, small scale investors, farmers, whatever, they might go and use them as well. And the thing with the bucket shop is that you're not in the market. You're betting against the shop. Like a derivative of the market almost. Well, it's just a gambling shop. Then you're betting against other people in the shop and the shop. It's a market of the market. It's a market of the market.

55:18But the thing is, the shop is in the market. So, you know, so the game is rigged because if the price is moving against the shop, the shop can buy and move the price back again or something like that so the shop was and that structure is not dissimilar from the structures around robin hood and gamestop and all of that because those guys are not necessarily in the market they're in the broker yeah and the market makers can potentially front run the orders as they come through citadel is it they get a lot of flack Yeah, they got a lot of flack. And Robinhood a few times went with the GameStop thing.

55:57They just stopped trading. It's like, that's definitely benefiting you. You're not, yeah. But they were taking on too much risk probably and they have to like collateralize the trades and it's probably quite aggressive on their side. They probably ran out of money. Yeah, that's what's liquidity in their life. You know, the point is that the investors are effectively betting against each other in say Citadel's books and then Citadel's only offlaying any residual risk into the market. That's how it works. So it's the same. Very similar. It's the same. It's different technologies, you know, the bucket shops kind of, you know, chalkboards and telegraphs and slips and what have you.

56:31And Robinhood's on the commission-free app, which, of course, isn't really commission-free. Yeah. But it's the same game. So I think that what has happened is that new technologies have made new kinds of access possible. and you know the idea that we're all we're all you know we all have to say for our future we have to have self-invested pension funds you know we will have to be in the market as kind of citizens and so forth that's very much a post-80s idea that's a thatch that's a thatcher idea so that too has has changed do you think then we we fundamentally don't understand how markets work if you're saying because i don't think most people perceive it as that way that the bucket shop analogy or yeah i i think that we either don't or we kind of don't do or we don't care i mean i i i think that sophisticated people investors who are sophisticated retail investors who are playing around on on um robin hood or whatever they know they kind of know what the rules are they know how it works but they they don't they don't care do you think it matters I don't, well, yeah, I think that it probably does matter.

57:47If the game is rigged somehow, then it does matter. Yeah. But we're, you know, I suppose it depends how seriously we take it. You know, these people, are these people who are all on Wall Street bets or Reddit or whatever, are they, you know, are they saving for their future or are they just mucking around? um but but you hear stories about people taking on student loans and then kind of blowing it all and ending up and it it does matter have you ever been into the wall street bet subreddit i have been into that's a cool place i've seen some of the bets those guys put off out of the money like you know crazy swaps and all of this stuff is it true is it i mean this is this is the theater of the thing isn't it you know who's for real who's a shell yeah i don't know this is this you know all these all these all these memes it's kind of sexist it's it's it's porny you know there's this again it's this whole like culture of what what finance what finance is and it's and it upsets the people who got really upset the finance professionals because this isn't what finance is finance is kind of smart and neat and clean i never actually thought about that yeah some of the mean coins are really sexist there's like oh yeah mega coin trump coin and there's like all all these like phallic coins and like, yeah.

59:00All of the meme culture and even like their anti-heroes or heroes, Martin, what's his face? Shkreli. Shkreli. You know, the guy, he bought up drug companies and boosted the prices and was the most hated man in America, but within that - Is it cancer medicine or HIV medicine or something? Yeah, AIDS or something. But within that community, he's a God because he was teaching them all how to trade. So they love him and they have these anti-heroes and the whole movement is very anti-establishment, isn't it? Which is kind of, it's almost become a way for them to rebel against, let's say, 08, 09 and the way that people see.

59:32Yeah, but is it? I don't know. I don't know what I believe and what I don't believe in there. It's all very kind of... Saw smoke and mirrors. Smoking mirrors, isn't it? Yeah. And you don't know. I mean, I'm sure GameStop, you know, I'm sure the hedge funds were all tearing each other up as well. I'm sure when Melvin Capital looked like it was going to go bust that all its little friends were ripping chunks out of it. I don't believe that it was just a bunch of private investors suddenly kind of got control and got power and finances difference. I think it was for an instant. There was like an initial squeeze.

1:00:05But then I think the hedge funds reposition themselves. They take the other side. Within a few days, they proved that there was hedge funders in there spreading rumors about other companies trying to pump positions. I think the hedge funds now scan those boards, you know, kind of algorithmically scrape them and it feeds into their trading platforms and all these kind of things. So I think this is a good point on the retail investment. If you're like me and you buy an index fund and you just try and track long term performance in the market, it probably doesn't matter. But if you're trying to play those kind of games where you're thinking, I can beat the market, I can beat other investors, you need to understand that this game is highly sophisticated and rigged against you in a way.

1:00:43Well, Michael Lewis says that it does matter in this book, Flash Boys. He says it does matter because we're being chiseled. Every time a pension fund or a big institutional investor goes to buy something, it's been front run. So it does matter, even for us. Even payment for order flow in America is an example of that. I know they ban it here, but Robin Hood basically, like you said, it's not free. What they do is they sell the book to Citadel. They say this is the orders everyone's going to place. Citadel are the market maker but they also get to see what everyone are about to buy and they can buy the other side of that or yeah just buy an index just buy an index and try and mess with this crap but Damien I agree and I buy indexes too but there are problems with buying indexes oh tell us more we're in the conversation here cut the camera we're done get out of here yeah go on the first problem is that if everybody buys the index then the market doesn't work.

1:01:44Oh yeah, because there's no price discovery. There's no price discovery. Yeah, yeah. And I might pick you up on price discovery in a minute. Please don't test us anymore. In a minute. Don't test us anymore. It's too early. It's been like 10 odd years since I did a degree in finance. Okay, okay. But it's the word, price discovery, right? Anyway, the second thing is that we lose any kind of sense of power ownership. or, you know, we become passive. They're passive funds and we become passive investors. And we're all sat here complaining that, you know, the water company can't keep the rivers clean or whatever, but we can't do anything about it as stockholders because actually what we bought is a bunch of, you know, iShares or BlackRock or something like that.

1:02:30So there are these three massive, massive firms that own, you know, I can't tell you, a substantial proportion of the big indices. you know, with celebrity CEOs like Larry Fink and all the rest of it. And they have incredible power. Yeah, Vanguard's at 8 trillion under management. Yeah, incredible. And BlackRock's even bigger. Incredible power. And if BlackRock decided actually that they were going to take global warming seriously, then the world would change. But of course, they don't because that's not their business. Their business is providing passive traded, you know, funds. So we surrender.

1:03:09in the pursuit of the kind of optimum outcome. And I agree, you can't beat the average in the long run. That's kind of what this comes down to. But in the pursuit of that, we surrender certain tools that we might have for holding these organizations accountable. I agree with that. But to push back, let's say you've got a section of the market that they actively participate, they value businesses and they engage and they will always do that to some degree. You then had the previous portion of the market, which 10 to 15 years ago would go for a broker and just get bent over for fees. And the broker would say, you should probably buy this and they buy that.

1:03:48I feel that the index has replaced that and allowed retail investors to participate in the market passively. In a way, they were doing that anyway. They were just being through a broker. They were passive through their broker. They didn't really understand. That's fair. And I think that's a good thing. I get what you're saying about if everyone is indexed, we're in a lot of trouble. But I think the same thing that we were saying before about the Chicago pits, why do people do it? Some people just love that shit, don't they? Yeah, they're always going to try. There's always going to be noise. Even like Warren Buffett always says, if you paid me in seashells, I'd still be doing this.

1:04:23I don't know if that's true. There are a lot of seashells. Yeah, yeah, yeah, yeah, he would. Yeah, he would give them all away, wouldn't he? But like, I think people are always going to be on that edge. But yeah, I do see, I see the criticism of indexes. And I do think if it extrapolated out to everyone doing it, we have a big problem. But I actually think it's just allowed a load of people that used to get ripped off to access the market cheaper. Yeah. Okay. That's true. But the point about, you know, kind of power over, and you're right that people maybe don't understand what it is that they're buying all the rest of it.

1:04:56But that's a problem too, isn't it? If we're all shareholders in, we keep talking about infrastructure and infrastructure fund, we're like, oh, it's great. I'm getting 15 % a year. Isn't this marvelous? You know, you never stop to think 15%. Yeah, that's off. You know, you can't make that money. You have to take it from somewhere. This is about kind of redistribution and taking money out. And so there are questions about what financial literacy means in a deeper sense than just, you know, you shouldn't buy Shiba Bitcoin or whatever. It's the cleaning. It's the cleaning act again. It's not slaves.

1:05:37It's companies that are just like ruining the world and we're passively participating and we're basically saying I'm an index investor. What I am is just helping to ruin the world. We're complacent in the destruction of the world. And we're rewarding those executives for generating shareholder value. Yeah. Because that's what index investing is all about. It's all about shareholder value. We have Marion Somerset Webb sit here and she talked about voting rights. And she made us aware of the fact that what they do is they bring in consultants that tell you how to vote. So like we give up our right to vote as an individual or we pass it off.

1:06:12And Vanguard say, we'll do that, say, in some capacity. and then they go hire a company that go that come in and go oh we'll do we'll tell you how to vote and it's like what are their influences or biases or yeah yeah for sure who's lobbying them for sure i i i don't know i think that you know it's kind of analogous to um shopping for food or something like that we think well you know i i don't want to buy bananas anymore because bananas are really bad for the environment or whatever but but what difference does that make you know individually individually, this is, this is not a problem. This is not a problem that can be solved by individual consumption choices.

1:06:48Yeah, so yeah. Like avocados, I'm like, oh, loads of bees die when you get avocados. I'm like, my stymie, my avocado on toast. So like, like if I stop, they're still going to be harvesting avocados. So we have to wear, we have to wear two hats, effectively. We have to wear a hat that says, okay, I'm going to, you know, I'm going to buy the index. I'm going to look after my pension because that's the world I live in. And, you know, and I'll starve when I'm old. If I don't know everyone, I'll say it's your fault. you should you know use your own index but at the same time we have to find ways of of of thinking about this and participating in this and and you know being being as being a citizen yeah because you know not participating isn't really an option no one's coming to save you you know in terms of pension you've got to generate some value yeah and sorry you might be able to hear the dog in the background drinking water i was going to say it was you that's how he drinks laughing up the laughing up the glass of water no toothless the dog is in the back having a good old drink aren't you toothless but yeah no it it is it is it is it is a problem and it is a question because again the power of finance to influence change in the world but people have to lean on it to get it to do that and if we want a green oh to main had a shake if we want if we want a cleaner a greener world, finance is probably the route to do that.

1:08:09Capital flows, they say, don't they? If the money starts flowing towards certain areas, the business leaders are going to be like, well, we should do that thing. Yeah, absolutely. Vegan burgers were an example, right? The movement, there was a rise of demand for vegan products and all of a sudden, Greg's transformed their business off a vegan sausage roll. It's not because they suddenly thought, oh, we should stop killing pigs. They thought, oh, we can make a load of money here. McDonald's, I tried their little vegan burgers as well. It wasn't very good. The McPlant. Yeah, it wasn't the best. Smells a bit weird.

1:08:38Yeah. Because a lot of McPlants get eaten in my house. But they like them. They're all right. Double McPlant. I think it's a Beyond Burger or something, isn't it? Yeah, Beyond Meat. I tried it for a bit. I thought it was a bit weird. No, I don't mind it. It's all right. It's all right. Not as good as the real thing, but it's all right. The Greg's vegan sausage. Yeah, that was a winner. That was a winner. I think this, you know, this isn't. They're like, they're really good. They were good. They're a good company. But, I mean, there's all questions about the ethics of that as well. Lee has been exposed to just being evil.

1:09:07So, I mean, you know, again, I don't think these are problems that can be solved by consumption choices. But that doesn't mean that we shouldn't consume in a responsible manner, but they're bigger, they're bigger problems. Do you think that the solution is voting? Well, and... Like shareholders voting. Voting and, you know, voting in ballot boxes and kind of, you know, they're trying to change the discourse trying to change the way that that we think about things so the the the world we live in now is a world that emerged through the work of kind of you know intellectuals and academics and economists and whatever in the 60s 70s and 80s it found its way into policy and you know and regulation all of these kind of things so so the the kind of conversations that we're having now can help because it's all part of the performance of it and part of thinking about how we do finance.

1:10:03All part of the theatre. All part of the theatre. Yeah, I love the theatre. I love it. Is there anything, and I mean, I think that is probably the point, but I do want to say, is there anything that you think people can take away from this conversation or your research that they should apply to their own life when engaging with the markets with finance? Well, no, I think that's it. I think it's just not taking it for granted, you know, not thinking of it as physics, as something that's set in stone, as something that has always been like this and will never change. You know, this is a social technology, we call it.

1:10:38This is something that is part of and entwined with the society that we live in and is a product of it, technology and, you know, the information, the performance and all of these all of these kind of things and i think when you start thinking about finance like like that it's it's it's liberating you know it's liberating because you can you can reassess how how you how you how you live with it um and and what you might condone what you might not condone and you know when you're when you're editor of the world of podcast channels in 20 years time or whatever you know you can shape the discourse and yeah um podcast corp or whatever it will inevitably be you know you don't you can stop thinking about so evil think of my stop option yeah yeah yeah flood the thames i think i think that's it right yeah that's a strong note to end on hey guys did you know that we summarize all of our episodes in the newsletter you can find a link in the description.

1:11:44And please remember, this is not financial advice. Like we say a lot on the podcast, investments can fall and rise. In fact, it's pretty much a guarantee. Past performance is no guarantee of future results. So your money is at risk with investing and other fees may apply. As with everything financial, please do your own research. We really encourage that because no one cares more about your money than you. I'm Damo. Antti. This was an episode of Making Money from Our Company Most. It was filmed and edited by the team at Flowspire, Jack and Ben. it was produced by Ruth Edwards and brought together by Will Stollerman.

1:12:14What about Ruth and Toothless a Dog? Yeah, shout out them too.