Most People Don't Understand What Money Actually Is

28:13We were just talking about retail punters. None of that is going into what it would have gone into 30 or 40 years ago in my parents' or grandparents' generation, which is like, you know, if you had a few quid and you were in your 40s or 50s and you had a financial advisor and stuff, some of that money would have gone into a UK smaller companies fund. And that would have funded in my day, where I was involved, EasyJet or Games Workshop or, you know, any lastminute.com or whatever. That money's gone. I mean, it's not, this isn't like a slight problem. It's just, it's gone. All the small cap funds are gone.

28:41And what I'm saying is, each of these, and by the way, the other reason why Jeff Bezos and Elon Musk are so wealthy, because this is the other point, is that when all the money flows indiscriminately into S &P 500 funds from all over the world, there are all these self-reinforcing things that happen, right? So basically, if you run a Fortune 500 pension fund in the States now, you can't do anything other than put your pension, you know, your staff into an S &P 500 ETF because it's cheaper and 90 % of active fund managers underperform and all these sort of nuanced arguments. So now, and a load of congressmen and congress have effectively had the wool pulled over their eyes because they're not particularly financially astute by Vanguard and State Street and BlackRock, right?

29:27So all that money is going into a market-cat weighted ETF of the S &P 500, which means all that money or a huge amount of the money is going into Amazon and Apple and Microsoft and Tesla. And so it's these sorts of structural things that are making the rich so stratospherically richer than they ever would have been in the sort of the older system before this happened. And I think that is problematic, right? It's turbocharging winner takes all. Because US equities are performing so well, everybody else in the world, if they're in Zurich or Tokyo or London or Singapore, is getting into US equities because they want to be left behind.

30:01So that turbocharges it more. Then you've got all the hedge funds who use algorithmic strategies, which are largely momentum driven, turbocharging it still more. and so all of that all of that bun fight of capital just going into the 500 companies in the sb 500 is problematic because it means that you've got this winner takes all thing you've got vast income inequality which gary stevenson's right about he's right about the problem he's wrong about what caused it and what to do about it in my considered opinion i'd love to talk to him about that one day and what that has meant is that you know if you're an entrepreneur an entrepreneur who wants to you know a new software company or or launch a new hotel group or you know I was excited to be on the deal where we floated Caluchos and La Tasca, which was a tapas restaurant.

30:45And, you know, all these sorts of businesses. Nobody can do that in London anymore because all the oxygen, all the capital is stuck in the S &P 500. How many UK businesses listed on the American market? So rather than just looking at the UK market, if you zoom out globally, because I know that Monzo threatening to go to America. And all our big ones, I mean, Armhole is what we talked about before. It was like privately bought by SoftBank. So actually, relatively few, and I covered this in Our Futures Biotech in detail, specifically pertaining to the biotech industry, but it's true of all companies.

31:18There are a whole load of structural reasons where it's very hard for a British company to float in America, right? Obvious ones like it's really expensive. So, you know, in the old days, a small British company might be able to float in London for like a million quid, let's say, ballpark. It's like$5 million to get under the NASDAQ, right? There are hundreds more companies on there. So getting the attention of the institutional fund, like when London had like 150 small cap funds and all the stockbrokers knew who they were. And if you were the CEO of an entrepreneurial company and you wanted to do something, you could go around those 150 investors in Edinburgh and Manchester and Leeds and London and go and do a load of meetings.

31:53And they'd go, yeah, I'll give you two million quid for that. Or no, I don't like your business and I won't. And you'd be able to gather that money. If you now need to go to America, well, America's already got, you know, in 2019 or 2020, there were 78 biotech IPOs in America, right? It's all the same people stewarding the pots of money. So getting the attention, like it's just a prosaic logistical challenge. Like a British company, plus the British company is on a different time zone with different tax regimes. So there are all these reasons for American investors to say no. What's the scariest word in the English language to me?

32:26Tax. How does it make you feel, mate? Ah, stressed, sweaty palms, squeaky bum time. Don't like it. Mum is spaghetti, yeah, exactly. You got one shot, one opportunity to not go to jail for avoiding tax. Like, yeah, I don't like tax. It's scary. Tax can be really stressful, which is why we're excited about our partnership with TaxApp. They started in Ireland and now they're in the UK, and they make self-assessments way less scary. What I like is how quick it is. You just enter your info, connect your bank, and it helps you do your expenses to reduce your tax bill. You suddenly know exactly what you owe, no waiting around for an accountant to reply, and you can file in as little as 15 minutes.

33:03Yeah, and it's built for all kinds of people. Company directors, freelancers, the self-employed, side hustlers, or even people who work full-time who need to do a self-assessment. For example, anyone who needs to claim back high-rate tax relief on their pension at work. They're HMRC recognised, so they're safe to use. Plus, tax app flags reliefs and benefits you might miss, so you're not leaving any money on the table. We've left a link in the description. Prices start from£49. if you've got to do one this year check out tax app you can get 10 off as well using the code in the link in the description the code is money 10 so that's m-o-n-e-y-1-0 i mean how would they even know what monzo is it's crazy that you would go list in a foreign market notwithstanding everything i'm saying right now it's incredible the extent to which because we've destroyed british institutional capital's just being killed and almost all of it's either in american shares or in bonds, which is part of why the British economy is so challenged.

33:54Something that's incredibly poorly understood and you know I've written about. But, you know, even to your point, an awful lot of the companies that are succeeding in raising money in the UK are raising American money, tragically. But anyway... So what should I do as an investor about this? Because there's still that contradiction of, you should buy a global index, but it's actually a big problem. So when I'm remonstrating about the problem, I'm not talking to I'm basically trying to agitate to the powers that be and leading bankers and because we're all you know What would they do then? Well we're the mansion house accord the changes that Rachel Reeves is making right now are a direct result Mandation of pensions into the UK Yeah yeah You think that's a good idea?

34:38No I think I think it is a good idea I think the way it's been done is terrible Okay How would you do it? So I would have actually nuts and bolts I would so you had a whole bunch of smaller company funds in the UK that banged out 12, 13, 14 % annualized returns for years for years because of businesses like Games Workshop right I mean Games Workshop I don't know if you know Games Workshop was a tiny little ridiculous company never ridiculous Chaos Marines yeah same exactly I was a serious hobby Warhammer 20 ,000 40 ,000 40k 40 ,000 that's slightly embarrassing it is 20 years you were part of the 20k I was loving it and can't remember the name of it but it was a long time ago to be fair but yeah I used to paint Orcs and Eldar and stuff like that.

35:19Yeah, yeah. And it was like, you know. You redeemed yourself there with the Eldar. See, I was just making up for calling it one more 20 ,000 in error. But, you know, that was a little company that come out of Nottingham. And it's, what is it now? Five billion pound company. It's just awesome, right? And we could have far more of those if we had a much better stock market. But anyway, sorry, I've forgotten. How would you go about mandating people to invest in finished companies? I think the problem is in the listed world, like stock market listed companies. And if you had, you know, a few dozen funds in the UK that had two, three, 400 million quid like they used to, then you could float companies on the London Stock Exchange and there'd be an aftermarket to support the share price of the companies on the London Stock Exchange.

36:01and our world-leading biological science could get funding, which it can't right now, and everything else, our tech, our whatever, instead of a very few, very lucky few British companies managing to float on NASDAQ. It's not a lot of money to 200 to 300 million. Yeah, but... I know that's, you know what I mean, in the grand scheme of things, when we're talking trillions in the modern world... Yeah, but the way you get to... The problem is we've just, you know, almost every great success story is a story of compounding, right? and the compound effect. So to my point, Apple, what was Apple 25 years ago?

36:35I want to say it was a$5 billion market cap. It might even have been smaller at the bottom, right, after Next and all that stuff. And now it's a three and a half or whatever it is, trillion business. If it hadn't been able to get from five to 10, it wouldn't ever get to three, right? And that's just how stock markets and capitalism work. Like winners win and get bigger and consolidate. But if you don't have an ecosystem of creating any of them, then you'll never get any big future comments. Couldn't the government chuck this money into a fund? Because 200 million in the government sense is a rounding error, right?

37:06So like that... I'm not sorry, to be clear, I'm not talking about only 200, I'm talking about a number. Like if you had billions of pounds. So what they're doing at the moment is they're basically mandating loads of pension money from 19 of the biggest pension funds in the UK to go into private equity and VC at the totally wrong point of the private VC cycle. Aren't they all like going to blow up through private equity and VC? And so it's like, you know, I don't want to be... They're all exposed heavily to the AI side of things. But they're also just... Well, and by the way, part of the challenge that P and VC have right now is the IPO market stopped working for all the reasons we're discussing.

37:44And the way that these companies get their money back and get the money back from making an investment in a private company is by flooding on a stock market. Yeah, by dumping it on the retail. Yeah, so what you need is billions of pounds going into stock market investors because the stock markets worked for 200 years until about three or four years ago when actually death by 1 ,000 cuts since the 70s. But just a policy I wrote about not that long ago, a very tangible policy. So there are 600 ,000 births in the UK every year, right? If you gave every one of those kids five grand, that would cost 3 billion, right?

38:18So every year, 3 billion, 3 billion, 3 billion. That doesn't sound much in the context of AstraZeneca that's worth 200 billion or Shell that's worth 170, or whatever it is at the moment. but actually that if that money was mandated it's in a tax sheltered account for the individual who's got it like it's a personal account that you have in your life and the worst thing that you might do is just never touch it but it's and it was mandated into a like 10 or 12 uk small cap funds like used to exist until a few years ago and it was only allowed to be invested in uk smaller companies you'd have 3 billion in year one three billion year three i mean in 10 years you'd have put 30 billion quid to work in UK smaller companies.

38:55That's like half of aim. That's a lot of money, right? At 18, it could then roll into the DC auto-enrolment. And it could become a more globally diversified, but you've got that. My argument would be you should never be able to take the money out until you're 55 or 57 or whatever the retirement age is. And UK smaller companies, the Numis 1000, the bottom 1 ,000 smallest companies in the London stock market, from 1955 to 2021 returned an annualized return of more than 16 % per annum. So imagine if everybody had five grand in a tax-sheltered account that supported British business. Three billion doesn't sound like much, but it's 30£100 million IPOs.

39:33That's 30 new companies that have all raised £100 million, right? And the£100 million of capital that goes in might only be for 10 % of the equity capital because that's what happens when you IPO. You float a minority largely, right? Which means you've created a billion pound company with a£100 million IPO. So you could create 31 billion pound companies if there were that number and then you start to pull an investment from the rest of the world because the americans go oh i'll take some of that exposure that's the other point momentum success begets success and momentum is super key we've seen in america sadly we've seen the 180 degrees opposite of that in the uk because of the way we've behaved in in the last 30 years but that's exactly right rather than london smelling and everyone going oh let's short london people go oh there's this really cool new initiative which puts three billion quid a year into and then there'll be a whole ecosystem of other fund managers growing up going, hey, we're going to have a UK smaller company, you know, sitting on the side of this new initiative.

40:22And then you get American and Asian investors and European investors saying, hey, there's a really resurgent London equity scene in small caps. I honestly think the only reason this policy would never be implemented is because the politicians are implemented today. It'll be people 20 years ago who get the massive political result from it. And it's a cost on top of a cost. Yeah, it's only three billion quid though. I said the exact same thing, did those numbers, and I basically said, anyone born from today shouldn't get a state pension, and they should just stop there. Like cigarettes, and we drag up the age.

40:55Basically, if your kid's born today, they won't get a state pension, but they get this five grand. We show them the numbers. And also, I said, you could mandate a portion of that was in the UK market, so Rachel Reeves gets what she wants there. And I dare say that parents would watch the rate of return on those savings and go, holy crap, they're beating us. So you get adult participation in the market. But the other ancillary benefit of that, all of which we're doing 180 degrees the opposite of through terrible policy. And just to be clear, terrible policy going back to the 90s, all the way through Blair and Brown and Tories and now even worse, right?

41:26But the other thing is not only do you sort out this pension situation to your point, which is super exciting. I mean, in 25, 30 years, you'd have a complete revolution. And the cost is fixed at$3 billion a year if the birth rate goes. Well, it might go up a bit as we get wealth through, like a lot of things. but it means you'd have a much you'd have a thriving economy yeah you'd have loads of little you know you'll have like game like computer game developers in dundee that can raise 100 million quid to develop the next grand theft auto or you know you'd have like right now britain's biggest one of britain's biggest problems economically is we just can't nobody can raise any money i'm telling you from first-hand experience you know in a very very tiny few like you know biotech I know about biotech because I spent 10 years working and three years writing a book about it right British intellectual property and Nobel Prizes that were won by Cambridge University and other places absolutely categorically underpin the the economic value creation the equity value creation that has happened in the biotech industry right the UK's what has accrued to the UK of that is trillions less than what has accrued to the US because of all this stuff.

42:38So if we had a thriving, like there are companies that are a few years away from effective cures for certain cancers. There are companies doing absolutely incredible things. We're employing AI and machine learning to do drug discovery and loads else besides, right? We can't fund any of it. We literally can't fund any of it. There's no, like biotech companies in London, you know, 14 of the last 14 biotech companies to IPO on a stock market since 2018, 13 of them didn't do that in the UK. And it's much harder to do it in another country when you're based in Oxford or Cambridge or Edinburgh or Dundee or Bath or wherever.

43:12It's much harder. And then eventually these companies get acquired for 300 million quid by an American business or by Takeda in Japan or by whoever, and all of the staff and all of the tax revenues and all of the intellectual property moves to america which is impoverishing britain that means we have tens of thousands fewer high-paid jobs for scientists and we are not making hundreds of billions of tax revenue that could have been making sorry you guys i've really got to apologize i'm ranting away don't worry is it only the government that can solve that because i i sit here and go you know i got 20 quid i'll give you some money what can i do there no no there is i'm not being flippant now i mean seriously like i I think the problem is we've now...

43:53I'm still waiting for the government to do stuff. We've now... There are a number of things the government could do, like what we just said, like give every child, you know, five grand on the day they're born in a tax-sheltered account and they can't touch and invest it in UK smaller companies. I think that is an amazing policy that would... But it would take years to turn the ship around. But, you know, I mean, we need a much more enlightened tax policy, you know, in terms of capital gains, national insurance. We have 78 % of people in this country agree with Gary Stevenson, think that a wealth tax is a good idea.

44:21it's a disastrous idea it would make britain way poorer it would drive even more of these businesses away even more of our intellectual property and i say all this because i just think it's a statement of fact i think anybody who doesn't you know the only reason that nearly 80 percent of british people can believe that that's a good idea is because they don't understand wealth they don't understand equity markets they don't understand how businesses are built how tax revenues are paid what you know how taxes paid how how economies create wealth and and the trouble and it's all very easy go bloody billionaires they've got loads of money but it's like but a billionaire is just somebody who's created a load of wealth so if you drive you know nick scronson he's just decided to go to dubai right and well wanker he's gone to dubai it's like well you know i think a lot of billionaires believe that they they can deploy capital for the benefit of our species and if you are based in a country and you care about that country for the benefit of the country better than the government can and i would say based on my own reading of things and 30 years studying such things and working with companies in the main i tend to agree wouldn't an individual say that they can deploy capital better in their own lives than the billion can on their but billionaire can on their behalf yeah but then the compounding you're talking about recently works for the billionaires right we're far too focused on wealth inequality and we should be far more focused on wealth because like the reason that you know if you really want to get cynical about it a huge part of the reason that there is inequality is is merit times compounding and i've i've done this example before but like if somebody gets one if two mates leave university at 25 23 years old and they're basically they're both 100 empirically in terms of work ethic fit health and fitness money you know education right and one of them gets one percent better every month the other one stays the same the 30 years later the one who gets one percent better every month will be 35 times better off than the one who stays the same.

46:09Not twice or three times, 35 times better off. So if somebody gets 2 % better, and what might that mean? That might mean that they know about accounting, they understand investment banking, they do computer programming, they keep really fit, they eat really well, and their mate spends six hours a day on screens and goes to the pub every Saturday. And I know it sounds really harsh, but the bit that people miss is just the sheer power of compounding. Because if you get two or three better than somebody else every month for 30 years that's why you have billionaires but along the way a lot of billionaires have created enormous good for our species like as we you know as we said with bezos and i think the problem is if you the other thing that's poorly understood is if you interrupt that compound trajectory and go we're just going to take all your money as tax to spend on stealth bombers or i mean how you want to read a book called squandered by a guy called david craig no relations of mine which is about how Blair and Brown pissed away a trillion quid.

47:02And it's just all the details of all the 400 quid light bulbs in the NHS. I mean, it's just private sector companies don't do that, right? You know, Elon Musk can launch a rocket for about, conservatively, a 20th per kilogram payload into space of what it costs NASA to do it. And once Starship's fully up in lights, it'll be a 200th. Why would you have the government launch things into space for 200 times the cost of getting private sector to do it? government private sector is not always better than the public sector at all i have to push back but it often is not because i disagree with you but i could also say that elon musk has done a lot of other stuff that people might go that probably wasn't that good that that man has that much power he is an ego he's an individual with an ego he gets butthurt like he faked being a good gamer because he's that much of a child and he made that pedo comment about that oh yeah that was years ago as well i mean like should someone like that we have 400 billion should But he doesn't have 400 billion.

47:59Again, this is the point. This is the bit about people just don't understand what wealth is. He'll be able to borrow against that, man. He has notional 400 billion of equity. He's got 400 billion pounds worth of influence. He has. Because the trouble, well, okay, there was a time in the last couple of years, what did Tesla do in the last couple of years? At one point it halved, right? Yeah. So it's like the valuations accorded to billionaires by people who don't understand the difference between equity and cash, right? They just think about, like, James Dyson's a wanker, you know, because he's worth 15 billion quid.

48:30It's like the equity valuation that underpins that wealth is incredibly capricious. And it's based on a multiple of earnings or other expectations or assumptions about what that is worth. And it can very quickly disappear. Anybody like Nokia was worth 200 billion euros, and then it was worth 1 billion euro, right? All the wanker billionaires that own loads of Nokia stock, well, not that long after they weren't. So it's like, I hear you, but I think... Is it anti-democratic? Is it like, it's not one man, one vote. It's one billion pounds, one vote. I think it is anti-democratic when, yeah. When you do so much power.

49:10Look, Trump at the moment, how much did Trump just diddle the crypto market for a personal gain, right? I'm trying to stay zen about it. Right, right, right. I mean, so there's... I'm not saying it's perfect. I'm just saying that big picture when we zoom out and really interrogate what wealth is and what it means. You know, the government large, to a great extent, government does things incredibly badly, incredibly expensively and incredibly inefficiently. And a lot of billionaires and like Musk and Bezos are the headline ones, but at a much quieter level, you know, a Finnish family that developed an amazing diesel engine, right?

49:42a company like Vátsala or Kona, when you get into a lift in any building around here, K-O-N-E or a travelator at the airport, right, is a Finnish company called Kona, which means machine in Finnish. And it basically makes all these travelators. What I'm trying to say is there are so many wealthy families out there, wealthy entities that have delivered so much value to the world and done it way more efficiently and refashioned the periodic table for all of our benefit, way better, in my opinion, than another$400 million fighter or smart bomber or any of the other things that governments piss money away on.

50:21So I just think all I want to say is I just think it's this whole, like, it's the richest fault. I think we need to think a bit more deeply about who deploys capital better. Is it a good thing to just have more tax and give the government more money? Because the other thing I want to say about that is today, government, everything's shit, right? The economy's shit. Society's shit. You know, mental health is rubbish. All the stuff we're worried about. Wealth inequality is terrible. And government's the biggest percentage of the economy it's ever been. Is the answer more government? Surely not. A lot of that was borrowing, right?

50:5610 % of that bill is dead because we all chilled at home. That's right. And monetary debasement, right? And the cancel on effect. But it's been a trend for years. I don't want to sound like I'm defending wealth taxes. In my opinion, I don't know. I just don't think it's as simple as it's the immigrants' fault and it's the richest. I agree. I never think the populist, these extremes of like, oh, all those boats and Jeff Bezos, it's their fault. I don't think it's probably, there's probably a load of new ones. But I think it's worse than that. I think it's a classic example of Turkey's voting for Christmas, right?

51:23If you want to, because the point I was about to make a minute ago is on the journey and whatever we do or do think about Musk, let's just say on the journey where a billionaire builds a business that becomes worth$100 billion, right? if there are tipping points where if the zeitgeist in the country they're in is such that they just go you know i can't be fucked and not because i'm a greedy bastard who wants to spray myself in champagne every day because i want to have control of my of the economic value i've created for the benefit of mankind a lot of very wealthy people think like that truly they think i mean okay musk wants us musk thinks that there's a risk we'll all get killed by an asteroid right and he has a passionate desire to get us off and have an interplanetary civilization and be in Mars we can debate whether or not that's a good thing but that is his north star of everything he's doing right and I just think that I've now lost my thread you shouldn't call which people I sit here I don't sell courses I try and give everything away for free I can make loads more money if I just turn the screws on monetization more effectively but I don't because I just I have a purpose or mission that drives me beyond that that I think I want people from places like me to be able to access the information for free.

52:34And I can concede, or I can believe that there are lots of people out there that have similar missions in their core. And that some of them might become billionaires. And just because they've got nine zeros in the bank account doesn't make them a prick. But also you can't become a billionaire unless you've created a shitload of value for society. Truly, it's the opposite of that Balzac quote. Or you've extracted from the environment, potentially. I look at Ineos and I think like they've probably done loads of good stuff, but then I look at the business and I'm like, this is a pretty dirty business, Jim Radcliffe.

52:59But every time we buy Viacal or whatever, right? Yeah, but it's a pretty dirty industry. So maybe it's like you've created lots of value or you've extracted lots of value from you. But I think there are really pretty serious guardrails on all of that, right? Like, you know, Environmental Protection Agency in the States and blah, and we all know there are problems with those things. But, you know, we have built a system over two centuries where that's got better and better and better. And kids don't get churned up in, you know, in machines in factories at the age of nine anymore, at least not in most of the world.

53:27He trips his kid up just to toughen him up. I push him over, I don't trip him up. He's too resilient. To be fair, he's a unit now. He's like conditioning. He turned three last week. But what size clothes does he wear? Like five-year-olds clothes. Five to six. Well, you're not exactly small, right? No, definitely not. I was going to say on your point about billionaires are better at deploying money at capital than governments. They can be. They often are. Not always. And Damien pushed back with Elon, but I mean you use Starling don't you? Yeah but shit. How good's your internet in your area? It's all shit.

54:04Exactly but like he's going to put a satellite in space to give people internet and that's better than the internet that's been given to Damien in this local area by the government so it's like It's also£100 a month which is pretty pricey but he was like we're going to give cheap internet to the world £120 a month and by the way but the other thing I wanted to in terms of the turkeys phoning for Christmas have a wealth tax blah blah whatever is the government's the biggest it's ever been which is also a key cause of inequality because it's something called the Cantillon effect, right? And this is where it gets, this is like, you know, John Maynard Cain said, not one man in a million understands inflation, which is a bit punchy because that's like 8 ,000 people in the world.

54:41But there are plenty of people who don't understand it and they don't understand these mechanisms. But like when the government artificially suppresses interest rates with quantitative easing, money printing, when the government prints loads of money, right? That makes equities more valuable. You know, why is the S &P going up, up, up, up, because it's in depreciating money because it's monetary debasement. If you look at M2, the gross... The dollars it's priced in are worth less. Correct. Now, what does that do? It makes normal people's lives much harder because they don't own S &P 500. They don't own property in central London.

55:13They don't own gold and silver. It's called the Cantillon effect, and it basically means that the more government is involved, the more money printing there is, the more monetary debasement there is, which we've been doing in size since the 70s. Government's got bigger. Government's printing more money. governs the private sector, that creates income. That is front and centre why we have such bad income inequality, because that is what is driving Jeff Bezos' stock up and Elon Musk's stock up, right? And all the rich hedge fund people in London who have, you know, multi-million pound properties and why nobody can get on the property ladder, right?

55:45Now, the answer to that is not more of it. Like, self-evidently, right? Anybody in economic is like, no. If you have a bigger government and more tax and less real wealth creation, the Cantillon effect is stronger and the rich get even richer. I guess the people on the tax the rich side would say, and again, I'm just trying to have a debate here to mirror what the comments might say. People might say, it's not tax the rich to raise more revenue, it's tax the rich to redistribute so you tax work less. So you might reduce taxation on income tax and increase it on capital gains, increase it on inheritances, increase council tax, so you tax the wealth at a higher rate.

56:26But the very simple insight is whatever you tax, you get less of. The problem we have in this country right now is we're not creating enough... You want work, right? Well, yeah, but also you want wealth. Yeah, but should they not be taxed at parity? Should they not be taxed at the same rate? What's more important, wealth or work? There's a great stat. There was a study done of 3 ,500 of America's wealthiest families admittedly quite a long time ago, but it found that 70 % of very wealthy families lose their wealth within one generation, two generations, and 90 % within three generations, right?

57:01You lose 100 % of your labour within one life. So should you not tax that at a lesser rate than stored wealth and be like, if you've lost your money in one generation, I'm sorry, but that's it. I think what we've all, again, this goes back to the compound effect of how wealth is created. Through labour? If you nip, yeah, but increasingly intangible assets as well, goodwill, right? It's not, Labour's shrinking, Labour's not particularly well with their AI, but we're getting very easy to tell you. But like the flourishing of any economy that delivers real, you know, properties and computers and walk into any, you know, Boots or Superdrug or Aldi or Lidl or Waitrose and just stop for a moment and look around you at the miracle that you're looking at, right?

57:46compared to what anybody had 100 years ago or what my grandparents had right all of that is real wealth and the thing is all of the stories of the thousands and thousands of entrepreneurs and people who've delivered all those products in in the supermarket whether branston i mean it sounds ridiculous branston pickle or you know cathedral city cheese or stuff that's rather more complicated and more expensive or in um pc world on that journey i'm telling you from first time experience I've been working with hundreds of entrepreneurs in my life. If you have egregiously overbearing wealth taxes, people just give up.

58:22They just go, you know, I'm not going to be, I can't be, one of the really well identified problems in Britain is called the vicarage problem, which is that why does Britain not have any trillion dollar companies or really, really big companies? Because basically most people in Britain, when they become wealthy, just want to buy a vicarage and like retire to the country and, you know, not, and stop, right? most people in Britain, which I think is probably quite a good feature of our national zeitgeist, you know, if you're worth 20 million quid, you like stop. Whereas in the States, people want to go and go and go and create.

58:52And I don't think that's necessarily true, because I think there are a lot of it comes, it comes down to a lot more than money to your point you made earlier about being mission driven. You know, if you have a mission, the money's like, for most people like that, it's not about the money. The money is just giving you economic agency to go after your mission, whatever that mission may be. And, you know, and I think that we basically live in societies where a lot of those missions are really good for mankind. I mean, we could sit here, I want to ask you about public services and how they make poor people's lives better.

59:23And, you know, should we leave that to private individuals? But I think we'd get on a whole nother tangent if we did. Look, I think a lot of the things government does is really good and really important. Don't get me wrong. But it's just, you know, we've gone way way way beyond what it should be right coming back to the book if you if you had 25 year old you sat next to you there what's the one thing that today you would say to them that might surprise them about personal finance and the way your views on the world have changed i mean um it's taken me you know 30 years the best part of 30 years to distill out this kind of 80 20 like this is most of the result you need for as little effort as possible right like two or three funds, defensive, aggressive, you know, whatever, gold.

1:00:08And I wish my 25-year-old self had known that and hadn't put quite a lot of money into, like, Croatian land or, you know, some of the stupid shit that I bought. Actually, sorry, Montenegro. I bought a big plot of land in Montenegro with a city bonus, a little bit older than 25, but it was... And I've still got it. I was going to say, you've still got it. Yeah, I've still got it. And it's either worth$2 million or, you know, Marko Brinkovic or whatever his name is, has got my cash and bought a new jet ski or whatever, you know. and a jet ski, several jet skis. And so, you know, I wish I'd been able to say to my 25-year-old self, look, here is a really plain vanilla way of building wealth, like the way I now have written about for the last 10 years.

1:00:45Because, my God, if I could have just done that a bit sooner than, I mean, I did it pretty soon anyway, or a sort of a version of it, but if I'd been able to do it exactly as I would now do it when I was 25, I'd have a shitload more money than, you know, I wouldn't have land in Montenegro. You interrupted the compounding, basically, through buying your Montenegro. I did a fair number of fairly random things with my money back in the day, which I wish I hadn't have done. Have you got the lunch still? I have, yeah. Well, allegedly. Have you been to it ever? Oh, yeah, yeah, yeah. It's pretty cool.

1:01:14It's one of those things where if I had the time and got a consortium together, we could build like an amazing boutique. It's one of the most beautiful places in Montenegro. And I could get a group of people together and raise a load of money and put a hotel there and it would be cool and we'd probably make loads of money, but I don't have the time. When you say allegedly, do you think every other day shows another person around? Yeah, correct. I wonder how many people own that plot of land. The eyes, the eye can see is yours. It's all yours. Whoever the light touches is yours, son. The whiskey, you know, the people who own the whiskey.

1:01:40Did you see that documentary about all the whiskey scams and like elderly people buying costs of whiskey from unregulated? The same as the Scottish Lord thing in America. Yeah, yeah. You know, the entitled you or whatever. I'm a thine of Scotland. Yeah, yeah, yeah, exactly. And everyone in England's like, obviously you're not, but they took it really seriously that you could buy like a metre square patch and become a lord. Genius. Yeah. I mean, they made a lot of money. They were sponsoring YouTubers aggressively and their accounts come out and they were making like seven, eight million a month.

1:02:10It basically selling air, nothing. And they just bought one field and they just cut it up into little tiny blocks and just, yeah. Should definitely tax those people more. Yeah, yeah, yeah, yeah. So you would tax that. That's a robber baron. Yeah, yeah, come on. Crooks. Well, thank you so much, mate.