A Holiday Mailbag! December 29, 2023

31:26Why would we not go back to those levels? Because they were capital-intensive businesses in saturated markets with limited ability to get outsized gains in terms of growth. We've talked a lot about AI in the last few months. We've talked a lot about tech. Now, I'm not making a strong argument to say you should invest the capes in irrelevant, buy with your ears pin back. I got to say though, the history of the market is anytime you said, yeah, maybe I shouldn't invest, not the world's best idea. We're recording this a couple of weeks in advance or 10 days in advance. I'm writing an article that's going to be published this afternoon.

31:56So you might have read it by the time this goes out. The S &P 500, don't know if you know this, this is unfair. How much do you reckon the S &P 500 is up over the last seven weeks? I know it's a lot. Yep. I want to say 15%. Spot on, nailed it. and the russell 2000 which measures the u.s small caps is up 23 now six weeks ago if you'd sent me this question we would have exactly the same conversation now the market read down for 10 % in the last seven seven weeks my point isn't haha see i'm obviously right my point is trying to work out what the future might look like on the basis of this and not investing because you're waiting for a better chance you're betting against history you're betting against capitalism you're betting against progress i i'm not saying you should invest if you're listening to this and thinking I don't care I'm going to wait knock yourself out if that's if that's what you want to do Simon I'm not going to I'm not going to tell you doing the wrong thing what I would say is I am very very happily fully invested I almost always will be um because surprises didn't happen on the upside over time right yes there's some and what else are you going to do well that's also true yeah exactly what else are you going to do so I get it I get the thought I get the concern for all I know between the recording of this podcast and the publication maybe the market's fallen 20 who knows um if it is i'll buy if it's up to 100 i'll buy i'll buy because let me say one more time one last time for 2023 i can say that with confidence by the way because we've already recorded sunday's episode uh for the last time in 2023 vanguard index chart look at that and say when was a bad time to buy yes in hindsight you pick the highs you pick the lows you can trade out in hindsight if you have a time machine you make a squillion dollars by the way proof time machines don't exist if they did people go back and make a squillion dollars front running this stuff uh and if it It hasn't happened by now.

33:33It's not going to happen. Why? Because time machines don't exist. But, you know, that's the reality of this situation. So I get the concern. I don't know what's going to happen next with share prices. I expect in 10 years' time we'll be glad we kept investing. So it's genuinely as simple as that for me. Yeah. Look, I would say that even if you, as I do, have lower return expectations, they're still going to be better. And I think that's what that Vanguard chart does a good job at. You can get hung up on what is the long-term average and what will the average compound annual growth rate be over the next five or 10 years.

34:08And we can have all kinds of interesting conversations about it. But I would suggest that whatever happens, good or bad, difficult times, good times, you will find that on a relative basis, relative to other asset classes that are out there, yeah, it'll be far more volatile. Absolutely. But over any meaningful stretch, it'll probably still be the best one. I mean, is it a tragedy that over the next 10 years, you take all of your excess savings and you put it in the market? And when you do the sums in 10 years time, it's like even when you adjust for inflation or all you've done is like maintain your purchasing power.

34:46I mean, that's not any of the results. We want to improve our wealth, like obviously. But if that is the outcome and the comparison was staying in cash, in a world where interest, well, inflation was, well, let's just be generous and let's just say it's 3 % a year, right? That's still 30, well, more because of compounding. But over 10 years, you're going to lose 30%. Yeah. Not nominally. I mean, the dollars are the dollars are the dollars. But, you know. You buy 30 % less stuff with the same money. Okay. if you're smart about it you probably find a good a good account which pays you a little bit of interest and and the rest of it but so you've you still got something i would say you're generally going backwards over time versus something that in purchasing power terms is at least maintaining itself and so even when you look at it through there it's like is that the outcome that i want not really is it better than the alternative yes and hence tina there is no alternative over any meaningful stretch and then if it's less than that where people go yes but the market could crash 30 % tomorrow.

35:47Yes, you're right. That's always and forever true. But then you're back to the problem of, okay, Einstein, time that for me. Are you going to be the first person in history who's ever been able to consistently and accurately do that? Maybe, but no one else has managed to ever do that. So it's kind of like, I guess I stay fully invested. And your point, mate, even with those crashes over the long term, unless you, if you need the money tomorrow, don't invest it. That's stupid. No, I've got to. If you don't need the money for three or five years, then generally speaking, it's still the best bet even with those crashes in there a bit uncomfortable a bit volatile you're still better off doing it doing it living through those than trying to avoid them just it just makes it mathematically has worked out that way no promises the future could be different to the past but you kind of wonder why it would be and i can't come up with a good excuse so that's why i invest in shares can i say one more thing too because you talked about an article i wrote one on last weekend for members which was the idea it is a tale of two markets so it's it's not as pronounced here on on the asx compared to the us where the magnificent seven had done all of the heavy lifting but the the i should pull it up here because i'm going to go blank on the exact specifics but if you look at the asx 300 the largest top 300 companies yep the i think i think this year that it is on track for something like a uh uh four or five percent return right it's okay price or including dividends uh including dividends okay i'm just i'm furiously clicking here sorry how's the weather scotch is it's really yeah how about those how about those how about those nets oh here we go okay so so no perfect perfect so factoring in dividends the asx 300 has so far advanced 8.8 it actually sits at a record high year to date okay and and but that's why i knew that that question because at the start of november it wasn't looking that great And then we've had this really sort of late rally here.

37:39So that's pretty good, 8.8%. It's not far off the long-term average. You're almost bang on it, in fact. But let's have a look at the small ordinaries index. That is the same index, the ASX 300, except you take away the top 100 companies. So it's the 201st, sorry, 101st to 300th largest company. And then dividends included, the year-to-date gain is under 1.5%, or at least it was last week when I wrote this. so that that is that is huge right and not only that the index is still where it was basically four years ago and it's actually the small odds is 16 below the high water mark that it said in early 2022 that's really interesting and then there's a s &p have this index called the emerging companies index which is smaller micro cap so it's the 300th to 650th largest companies a few liquidity factors in there as well.

38:31That's down 8 % over the last 12 months. So this is a long run up to say that all of the gains have been held by the top 100 companies or the big companies. In fact, you go on S &P's website, which I did, and I'm going to use price to sales here. It's a really rough measure and it's not a good one, but I have to because the average PE of the small ordinaries is negative because there's a lot of loss making companies in there. So just to make at a more even comparison, the ASX 50, the 50 largest companies, the price to sales, by the way, these are almost by definition, lower growth companies, right?

39:06Because they're far more mature. But the average share price is 2.2 times the revenue base of these companies. So price to sales of 2.16, in fact, for the ASX 50. For the emerging companies index, the small cap, micro cap, it's 1.1. In other words, relative to the sales being generated, the price to sales of the bigger companies are twice as expensive. So again, I point this out to sort of say, well, there's the market and we've seen what that's done. But I would, and this is really a rally to our members to say, I know it's been a pretty crappy year. Don't feel too bad because everyone in that space has done bad.

39:46But here's the good news. The good news is as we head into 2024, all of the big stuff is expensive and all of the small stuff is actually pretty cheap, you know? And so isn't that a good setup? Like, I mean, isn't that what you want for someone who is in the stage where they are allocating capital, not drawing down capital, but allocating capital that, yeah, okay, that's what the market is doing, but dig beneath the surface and you will find a lot of interesting companies that are actually, I would say, really, really good value at this point in time we i suspect we will look back in the years to come and i'll be like huh smaller micro caps was where it was at because while everyone was paying attention to the big end of town all of these other things flew under the radar and there's actually get some really incredible value there a lot of crap as well let's be real you know a lot of crap in this needs more time more analysis but it can be super rewarding but super rewarding and and to you know do the work and there are spoils to be had nice motley fool money for more subscribe to the free newsletter at fool.com.au forward slash listener.

40:56Mates, Andrew sent us an email. It says, hi, Scott and Andrew. Firstly, I want to say I love hearing you each week on... You know what he's going to say, don't you? Go on. The podcast machine. Hey. One last time for the year. I've been listening for the last year and your clear, frank advice is just what is needed, says Andrew. As a reformed economist, I also love the observations and ranty social commentary. The world needs more of it. Don't encourage us, Andrew. Oh, no, here we go. Speaking of which. And not to set Andrew off, but the property Ponzi scheme drives me nuts. For me, I don't count the value I have in my own home unless I decide to sell and move somewhere else.

41:33I don't want to leave. It's not liquid at all. Fair enough. I will say, as a quick comment. Well, I'm going to throw a quick comment in because the value of the home is effectively the saved rent thereafter. So you're right to say you can't liquidate it and claim the value in itself. But if you didn't have it, you'd have to be paying rent. So in an opportunity cost world, there is more value than just whether or not the dollar value is useful to you or not useful to you. Don't necessarily count the dollar value and say, I have that much money or I can liquidate that much cash. But an opportunity cost sense.

42:09The fact you have, in theory, at some point, whether you're mortgage free or not, But at some point, you're saving yourself some money ongoing. There is real economic value in that. There's always the opportunity cost. What else you can do with the money? I was going to say. But it's not worth zero, right? Because there's a foregone return. There's also a captured rent, if you like. Well, I mean, just, again, I know I'm the only, maybe me and Andrew are the only two people in the country who think this. But that's the return. That's the return, right? The return is having somewhere to live. That's the return, right?

42:43The return you get of buying a car is not what you can resell it for. It's the – you get transport. Yeah, so utility of being able to get from point A to point B. Yeah, exactly. Utility, right? Like, it's super important. Just on your – while what you said is true, you do have to net that off against interest payments. People say, oh, red money is dead money. It's like, it's true, it is. But so is interest. Right, correct. And you rightly mentioned opportunity cost as well. So, but yes, continue. On to my questions, Andrew. I'm time poor with two kids under two. And so I won't lie to myself that I'll make time to go deep picking the right stocks.

43:16So I've been focusing on ETFs and robo-investment platforms. My question to you is, do you think the extra fees are worth it for long-term lazy investors to use platforms like StockSpot versus a managed Vanguard fund versus just buying simple ETFs like the Vanguard ASX 300 ETF? What say you, Ram? uh look i think that the stock spot guys good guys um i know chris i like him i like what he's doing but i wouldn't use it i say that in the nicest way because because i can just open up a very cheap brokerage account there's you know brokers are everywhere throw a rock in sydney and you'll hit a stock broker or a real estate agent they're around and and um you can just you know pay a very low brokerage fee and get direct exposure to a vanguard or something like with very low fees the value of the stakes and the stock spots in this world uh and this is this is entirely appropriate they're providing you a service and so it's it's a if if they if the service they offer gets you over the line and gets you to do things that you otherwise wouldn't do then that is worth every cent that they charge like every cent that they charge like it's like the choice is between stock spot and doing nothing hell yeah go stock spot um and if you're very time poor and you really like the platform and it makes it easy and the costs i don't want to make it out like the costs are onerous they're not but they there's extra um it's like everything in the world right i could get takeaway every night and i never have to cook right never have to wash up right um but paying for the privilege but i'm paying for the privilege or i can go to the supermarket and cook it up myself be much cheaper and i've got to you know there's work involved that's the Which is better, takeaway or cooking yourself?

45:01Well, it depends on what you value more. So there's no right or wrong answer. But my answer for me would be that given – even I think if you're time poor, it doesn't take that long to – you've probably already got a brokerage account. And then you can just like type in the code of the one you want, hit buy and you're done. Like you can just set an alarm and do that every month. It's not – I don't think it's that hard to do. Having said that, if you like the service that these other platforms offer and they get you to do what you otherwise wouldn't, go for that, absolutely. Yep, I actually million percent agree, mate.

45:34Motley Fool has a service called ETF investor I've talked about before. I'm not going to spruik it again this time. We charge money to help you pick ETFs or you can do it yourself. And if you want to do it yourself, do it yourself, save the money you'd otherwise pay us. If you want someone to say, actually for a pretty reasonable fee, what do you guys think? You guys are the experts or you guys do this for a quid or whatever else. Can I have your help? And that's exactly what this is. so the question is simply as ram says are you getting value for the fee if you're if you're if you're better off by at least the fee pay the fee you know if you're if you i mean our service is 29 bucks if you get$30 worth of value pay the fee because you're a dollar ahead if you get$28 worth of value save the money and the same with any of these services platforms really look here's the thing right i think there are some really really really really really dodgy people in our industry there are also some really good people who are trying to make money for themselves by helping you do better and your job is to work out which is which and then of those who are genuinely trying to help you and trying to make some money themselves that's completely fine we're all we're not living a capitalist world none of us all of us work for money right it's not an evil thing to to expect value in return for the value you provide it's pretty funny when people accuse companies of profiteering but then would happily take a pay rise they're given by the boss like well hang on you're just profiteering from the fact that wages are going up no no i'm not but that company is yeah that's a that's a massive tangent um so yeah if you're getting value out if you're getting more value than you're paying do it if you're getting less value you're paying don't do it if you want to save the washing up and you that's that's worth something to you get the takeaway um if you know i'm cooking get the takeaway because the food's gonna be better but uh yeah i look i but so again like andrew said i wouldn't do it i think there is an easy enough way to get here's my here's my biggest concern with this and this is my my biggest bugbear with our financial well no it's not the biggest one there's a million one of the biggest ones is the percentage um percentage fees that you are being charged on an ongoing basis you know advice is hey here's a fee for this service okay great i've got your advice thank you i've paid your fee don't charge me again next week and the week after the week after that now yeah if that fee is low enough that it's still worthwhile because instead of 100 bucks up front i pay two dollars a week well that's fair but if i get one lot of advice i pay two dollars a week for the next 25 years i'm probably not getting looked after and you and i've said before am that over the last you know when you compare super funds the difference in fees can be up to 40 of the final value even though it looks like a small fee even though the percentage looks really small as a difference they add up so i would say just be really really careful i don't know stock spot i know it's business but i don't know it's fee so i'm not going to comment on stock spot but there's other platforms out there that yeah are just raking in the fees and really if it gets you going like it's interesting if it's better it's all of these things are better than nothing by definition if you wouldn't invest otherwise pay the fee you know you're better off having 50 bucks at the end rather than 100 except if the alternative was zero so it's just it's just worth it if it if it does the job for you if it gets you across the line i think that's the that's the key one for me i think that's probably where i'd i'd go from there yeah another good example is with i've got a friend who pays for a personal trainer right right right what are you doing man like you know it's expensive i'm not not having a go at personal trainers here right right right but but his his opinion was yeah but i won't do that i will i do not i lack the motivation for me to to go and uh uh do it by myself like i will just find an excuse but if i've made the booking with this guy i guess i have to rock up to the park and so for me it's what and then i actually go yeah that is money well spent and plus you probably you've got someone who knows what they're talking about too so you know rather than you making making it up but yeah that's a great example that's true for my wife and i i don't she does yeah that's it it works for her and it works for me and you know it's it's just it's just the value of the value of the money so i think that's i think that's super worthwhile hey um he's got a second question too mate he's a second question if you will allow it i'll allow it and so who's is that i'll allow it i can't think where's the reference yeah who is that you know people yelling at the podcast machine right now um it's like it It sounds like a judgey thing to say.

49:34Yes, exactly. I get one third of my salary. He says, think average Sydney salary in work shares in US dollars every three months as part of my employment. I've been burned in the past holding employee shares. So now I just sell them when I get them. Now I've paid down my debts. I'm planning to reinvest in an ETF or stock spot, et cetera, which is the question we just asked. Would you say it's worth trying to dollar cost average in this three month timeframe or just go for it in one transaction? I could sell all the shares when I get them and invest one twelfth every week for a quarter. But I wonder if the benefit of this is worth the extra trading costs.

50:10Thanks, Andrew. So I think at the bottom line, mate, this is effectively a question of how frequently is frequently enough? How frequently is too frequently for dollar cost averaging to work? What do you reckon?

50:25I mean, definitely the transaction costs are the thing to think about. I know for depending on how you're doing it, a lot of them will be percentage based. So it doesn't matter. Over a certain dollar value. Exactly. Yeah. Over a certain dollar value. I think mathematically it's probably better every day, but that's a lot of work and a lot of hassle. Yeah. And it probably doesn't swing it that much as well. I don't think there's any right answer. I think if there is a transaction cost dimension to it, then you're doing it once every three months is still like in the grand arc of time. Like it's not going to make any difference.

51:09Of all the regrets you have in life, it's not going to be, gosh, I wish my DCA was done in a more frequent basis. You'll still get all the benefits too. Markets don't move that much, that significantly in that kind of timeframes as to that, you know, you'll regret doing that. Mate, April 2020 is calling it, I'd like to speak to you. Right. Yes, that's true too. That's true too. I would just on employee shares, I would say it's hard to know without knowing what the company is, but I think they can be great. I think they can be really great. And they're very illiquid if it's not listed. And even if it is listed, there's usually trading rules around it.

51:53So it can be a little bit tricky. You do tend to get some concentration issues over time if it's just that's the only money that's sort of going into it. But if you are – and I think you're in a very privileged position being on the inside of the company. You've got a pretty good read on the culture, the vibe, how things are going. It's not inside information per se, and you can't quote-unquote trade it. But if you've got any sense that this is a company with a vision, a mission, and potential, you know, I wouldn't be so quick to – I only say this because I got – no names mentioned, but I did get employee shares of past employers and I did the same thing.

52:30I sold as soon as I could because of liquidity. That was the only, I had nothing bad about the company but I just, and I regret, I regret that. Like it was, it turned out it was a really great company and what was I thinking, right? So don't, if it's like, maybe you hate the company, you're just like waiting time to get out and it's like, you're waiting for it to crash in which case, absolutely do what you're doing. But if there is any sort of reason for optimism, I wouldn't necessarily rush to sell everything super quick. I agree, actually. I think I would be mindful of the waiting. Yes, the waiting.

53:03If you're getting a third of your salary every year, in three years you've got an amount that's the equivalent of your salary. In 10 years you've got three times your salary. You're probably not going to have anything like that in shares outside that. So it's going to get really, really messily overweighted pretty quickly. Ask people at Lehman Brothers how it felt when they had their job and their stock portfolio in the same place. Yes. So I completely agree with you, mate. I would probably find a point in between the other problem is you've got to pay tax on those shares as income. So you've got to have the cash flow to do that.

53:31When they're issued. Yeah, correct. So if you're not selling them straight away, then you've got to pay the tax without being able to sell the shares to get the proceeds. Which is a real, like I remember having the conversations, like it's so funny because the whole idea, the whole raison d 'etre here is to get, is to reward employees and to give them some buy-in. And you think, oh, that's great. What a great idea. And then we'd all get our shares and we'd go, what the hell i gotta pay tax on this this is this is outrageous and like yeah well it is an income it's just someone's bought the shares for it's so it's not but but it's a scenario where any value is off into the future it is uncertain and here and now i'm all i know is money is going out the door seems like a really bad deal right exactly exactly so i get it yep so look i hope that i hope that helps andrew hey um ben's got a question he says hi gents i'm a medium term listener recent subscriber first time question submitter there you go that's covering the time frames love for the pod he says especially the left-leaning rants in spite of the potential fallout from your audience i'm gonna say ben um i don't know that you would be wrong in terms of how our comments might be characterized but i think it says more about the state of politics than the state of our particular opinions um i don't i don't i don't know whether much of politics if you if you took today's politics back to 1980 certainly 1960 the political parties wouldn't recognize themselves um you know is it the overton window when things move yes so you find yourself all of a sudden the left of what otherwise would be the case i don't consider myself particularly left wing um i have have very specific views about certain things i disagree with jim chalmers and disagree with uh with angst taylor you know enormously in a whole lot of different things if it's more often left than right in the current environment so be it um i guess i would just say I mean, look, listeners will make their own conclusions or their own conclusions.

55:22But this doesn't start from a political perspective. It starts from what I like to think is kind of reasonably common sense. And if that puts me on the left or the right of issues, then kind of so be it. So, you know, if it's left-leaning, fine. If it's right-leaning, fine. I don't care. I just, I guess the risk will... Go on. I was going to say, the good thing is, is that by sort of having a foot in each camp, and I'm probably the same. I'm probably like socially left and sort of economically right type thing. Yeah, yeah, yeah. Yeah. And, but you kind of, I was going to say like, you know, you're always keeping someone happy, but it's more correct to say that you're always annoying someone.

55:54No one likes us. We never make it on social media, mate. The only way you make it on social media is you pick a cause and you go so hard down that line, you attract your fellow travelers who love you and retweet everything you do. I think I've said to you before, mate, I, every now and again, I look at the tweets that kind of get some good attention, the number of retweets or the likes or whatever. And the retweets, they're very different groups depending on what opinion I'm expressing. some of those people who could find themselves on one side of the spectrum will retweet one thing I say and another group entirely retweet something else I say and they must be confused.

56:23I think you're one of our guys. I think you're one of our guys. If we're left learning, so be it. I bristle a little bit at the description only because it presupposes a political preference first and then a policy view second. I hope we've demonstrated we're pretty flexible with the views we've expressed at different times. So I will say that. Anyway, Ben says, apologies for the lack of witty anecdotes. That's completely fine, mate. We'll supply the wit because we're good at that sort of stuff. Well, there'll be anecdotes. Let's not get carried away. At least that. We promise we'll say some things.

56:57I've only been investing in stocks for three to four years, says Ben. I've had the misfortune of making the most big ticket mistakes in that time. We'll no doubt continue to do so. You and us both, mate, we've been there as well. My question relates to your opinions or advice on owning stocks listed on overseas markets. I believe that one is only able to hold$20 ,000 in US stocks at any point or risk being exposed to the US tax laws. Equally, I looked into investing in Novo Nordisk of Ozepic fame, which is that new wonder weight loss drug apparently. But it was all too complex and too hard. Currently trying to get my head around the implications of owning stocks listed on the US stock exchange, while currently owning ASX listed offerings, particularly ETFs, with at least part US-based holdings.

57:42this may be a completely rookie question and it's likely been addressed in the past but i'm trying to avoid an awkward call from joe biden in the future thanks in advance ben ben i rest assured i don't reckon joe biden's making the tax calls so you're probably okay there uh but it's not an unreasonable question i'm not convinced he knows how to use a phone to be honest he's getting to that age where it's you know anyway biden trump as a as a pair for the next election is a weird coming on a whole lot of stuff. Dude, there's 330 million people in our country. And they're the two old white men that you can cut.

58:14Like, that's it. That's the best of the best that's going to lead the free world. Like, oh, try harder. There you go. Equal opportunity, like pessimism against the spectrum there. We're just annoyed with the boomers now. Ben, I own US shares. A couple of thoughts. The US can change the tax laws anytime they want. They're also quite kleptomaniac in grabbing assets from right around the world. We've had colleagues and friends who've come to Australia, and because they remain citizens, they're actually still exposed to US tax law, even though they're Australian and living in Australia doing Australian stuff.

58:50So it's all very, very screwed up. I'm not aware of any particularly onerous US tax implications, with two specific exceptions. The first is the US withholds 15 % of any dividends as withholding tax. We've talked about this before. You can offset that against your Australian tax because Australia and the US have a tax treaty. So it's not additional tax at all. Capital gains tax is all levied here. There is no US capital gains tax payable in the US. There is, however, at some level, I can't remember what level it is, an inheritance tax that is payable on death on your US shares. If you have over a certain dollar value of US shares at the time of death, it's a relatively small amount of money and it shouldn't be in my opinion it's like saying i'm not going to invest in shares because i might pay capital grand tax when i sell whether you like death taxes or not it's kind of one of those emotive things i think it's all overblown personally but um if i am lucky enough to keep compounding at a reasonable rate and live for a decent amount of time i hope i have enough money i've said this before i want to pay more tax if i can i hope my kids have an inheritance tax to pay and i will not give them any sympathy from beyond the grave you know paying a little bit of tax whether i shouldn't pay u.s inheritance tax given i don't live there is an open question.

1:00:01But I guess I get to invest in their companies on their exchanges. So I kind of, there's like so much complaining I can do about it. I'm not aware of any other owner's tax requirements. You have to fill out a form, W-8-B-E-N or BEND form. The Yanks love coding. So do the POMs. We don't code our tax forms anywhere near as well as the POMs or the Yanks do. So, mate, there is nothing in the tax law that has precluded me or stopped me from investing in US shares. There's no issues I'm aware of to be worried about. Be aware of them, of course. and do your taxes properly. But I'm not aware of any issues that it raises that would be in any way detrimental to my investing or would discourage me for doing so.

1:00:38About half of my investments are in the US. Very happy with that. Very comfortable with that, despite the different tax regimes. Any thoughts from you, Mike? No, I don't think so, other than just see an accountant because that's what they do. I did want to make one remark though. Having invested for three, four years and sort of saying, making every mistake. I just want to lean into that because that is, I think that's normal. I think that's, I think actually, I've made mention of this before. I think the most, the worst, this is going to sound counterintuitive. The worst thing that can happen to a new investor is to have immediate and significant success.

1:01:19And I've got friends who have done this. Because it teaches you the wrong lesson. i remember when i when my kids were younger we passed those skill testers you know they and you'd put in two dollars and a claw would go down you're gonna always say like it's rigged you'll never get it and then one day they just got to me it's like fine like this would be a teachable moment right and they won like both of them like what how is it and so for the forever after that every time i want a toy i do that i was like yeah but you got lucky on that they learned the wrong lesson and and and the people who have been in that situation they go well that's interesting i put two grand in and i doubled my money next time i'm gonna put everything in and it was a speculative miner that happened that did really well so i'm gonna buy more of those speculative you know lot of ticket type things because i'm sure to win yeah just got lucky just got like and so that you you get blind to the downside you might you make the mistake of thinking this is all super easy and you start going you start going way up that risk curve people who have had a bad start the problem for them is that they go this is all rigged it sucks i'm out i'm just going to invest in property like every other australian um maybe there'll be a teachable moment there and then not too distant future but but until until uh that kind of happens i think it's as painful as it is it is the lesson that you want if you can if you can not that it's all rigged and that it sucks and you shouldn't do it but if you if you can push through that you start investing with a much more risk aware attitude.

1:02:53You start getting a sense of like, okay, this isn't super easy. And you end up being a far, far, far better investor as a consequence. So I just want to sort of like, you know, I get it. It sucks. I'm sure it's not the experience you wanted, but if you can stick with it, that is, I think you will look back in time and go, actually, that was a good lesson. That was a good start that I had a rocky path in the early days. i think that's a really really good point mate and particularly yeah i think um the benefit yeah particularly if you're starting young you're starting with smaller amounts of money because you're earning less and all that kind of stuff they're also less expensive mistakes so yes if you're gonna make them make them you want to make them then i as you said because you learn the right lessons but also because when you make them you want to make them a smaller amounts of money rather than larger amounts you don't make your first mistake with a million dollars in the bank right that's no no no you've my two thousand dollar investment drops by 50 it sucks right but my a hundred thousand dollar investment I'm going to feel that right yes and again it might put you off if you can develop a bit of a bit of battle scars a bit of scarring that kind of helps protect you from the next one can be pretty useful 100 % mate we have absolutely outstayed our welcome with the two or three listeners that remain on the podcast and mate I don't feel comfortable saying this but I'm kind of over it I'm only going to do one more podcast this year okay yeah that's it I've had enough too one more is all I've got I'm not doing anything until next year That's right We're having a break Only one more podcast And nothing until 2024 God that's bad The worst part about it is We've actually recorded the next one We're going to make similar dad jokes next time Oh you know it The good news is Most of you aren't listening now So you'll hear them for the first time on Sunday But until then With bated breath For the best dad jokes You will find Relating to the change of the solar calendar Full on Cheers The Motley Fool and people appearing in this program may have positions in the companies mentioned.

1:04:46General advice only. Please speak to your financial professional to understand how it may pertain to your situation. Subscribe to the free newsletter at fool.com.au forward slash listener. The Motley Fool operates under financial services license 400691.