Mailbag, incl: Housing security or financial security? July 12, 2026

24:11But again, there's someone else out there who has got to have an enterprise that is profitable enough to do that. And once you start doing that. So I was actually having a chat with a relative the other day. And we were talking about childcare. And back in the day, there was like a lady who lived at the end of the street. And the kids just, you know, we dropped them off there. And that was kind of what it was. and we sort of had a cash in hand kind of array. It was all very beautiful. Again, there's no victim. Where's the victim, right? Kids had this lovely old lady look after them. They had the time of their lives.

24:42She had some extra income. Everyone was fine, right, until we bring in regulations 1 ,000 miles long that the only people that can run a childcare centre now are some big corporate megacorp who's going to screw you over 10 times harder than the little old lady ever did as well. It's sort of like, I don't know if all of these things that were put in place to quote unquote protect people actually had the desired outcome that that they that they did that again a slippery slope here because you'll find examples against the rule and i'm not saying we should have zero regulation but but for every time we try and do something in the name of good and fairness and what's right and what's moral and what's ethical we can only make a proper judgment on the outcome of that by the outcomes and and by contrast to what would otherwise have been the case and it's just not black and white that's all i'm saying Yeah, no, fair enough.

25:32I completely and entirely disagree. That's okay. I think minimum wages is really important. And I think as a society - You don't like people having jobs. That's cool. I get that. I think as a society, we can and should afford to make sure that the least well-off are appropriately supported. I would rather have a minimum wage and a fair and - Fair's not the right word. I'll take that back because it's just too loaded. A reasonable safety net that allows people to live. I don't think as a country - What's reasonable? I'm happy with that distortion. Who decides what's reasonable? In government. Same as they do in every other regulation.

26:03Government decides what's reasonable. Same as every, yeah, speed limit, same thing. Medical procedures, same thing. Because you're not capable to determine what's reasonable for you to do a job? No, because it's not the question. I don't have market power necessarily, so what I'm offered may not be enough to live on. So I have no problem with saying enough to live on. The half of the decision in 1907 is very clear. So we have had a minimum wage system since 1907 based on the idea that a minimum wage should support an unskilled labourer and a family. That was the decision in 1907. I think that's a perfectly reasonable thing for Australia to do.

26:31I see no reason why we should have people working on less than a effectively living wage in a country like ours. If it's a distortion, sign me up. I'm happy with that. I don't just think we need to – we don't need to be efficient in every part of life. I think we can say we know this is going to be a story. We know this is not going to create as much economic value overall, but it's going to create less economic value and look after those people who otherwise wouldn't be earning enough to live on. I don't think that's a difficult decision for me. Provided they're the ones that get the jobs. though, right?

27:00Because there are less jobs. So, you know, the person who gets the job. Yeah. Okay. Yeah. And the example, I mean, there's minimum wage in the States as well, but we know there's, you know, some stupid number of people in America are on food stamps because the minimum wage isn't enough to keep this. So it's effectively charity by another name. So you say, well, it's a lower minimum wage. Yeah, but we top it up with all this stuff anyway. Centralized price controls, man. That's what it is. I'm cool with that. I'm cool with that. But they get it wrong there, right? Would you agree? I think the concept, I'm not talking about the level, I'm talking about the concept of a minimum wage.

27:31So, yeah, I think I do get it wrong there. I think they absolutely are pretending that they can pay less and then topping it up elsewhere. You might as well say, guys, let's not pretend that, let's run around and let's just do a reasonable wage. We don't have food stamps because we have a higher minimum wage. My point is just in broad terms, we know, literally by definition, the fact that it works on minimum wage, other than the most extreme examples, to your point before, means that without it, people would be on less. It's obviously true, right? Otherwise it would be a remarkable coincidence that 20 % of people earn exactly minimal wage and wouldn't get a cent less if we took the regulation away.

28:06So that would be on less if we didn't have it. And if that means businesses make less money, I pay more taxes, I can't find any good, conscionable reason to disagree with it. So I'm okay with minimal wage. But you are still within that framing, hoping that the powers that be set it appropriately. I think, of course. Which you perfectly reasonably could be, but I'm just saying there's plenty of other jurisdictions, First World nations that don't. So it's just, you know, I'm actually just being difficult for the sake of it, honestly, which is what I do. That's what we do. Which is what I do. Me too.

28:41But I find it interesting because it's like whenever you get that scenario, it's kind of like, yeah, it's good, but as long as the decisions that are good And it's something that you can be happy with as a trade-off. And in many situations, I personally am myself. It's just that it's got to – it is such a notoriously difficult balancing act to get right. And there are those unintended consequences. I would argue unintended consequences. We know exactly what it does. We know there is higher unemployment as a result. We're making a very conscious choice to – I mean, we don't intend the exact outcomes or we're happy about them, but we know exactly what's going to happen.

29:21So I think you're right. I agree with you by that. I'm saying it's not even, it's not an unintended, like we don't know. It's like we know and we're doing it deliberately and that's a choice we're making. Yeah, totally. I found it actually, just, this is maybe eight months ago or something now. I don't want to dox it. I certainly don't want to get anyone in trouble. But. But. Everyone's like moving closer to the speaker right now. I was going to say. There was a small business enterprise in my neck of the woods. Right. And they were in the food trade and I ordered some takeaway Our house is Friday night is takeaway night because it's just at that stage of the week.

29:55It's like, I can't cook anymore. I'm done. So it's our little treat. And we go up there and we get there and it's just like the people serving were the kids of the family. And I happen to know one of the kids because they go to school with one of my kids. Oh, such and such. How are you going? And I'm waiting for the food and I was having a little chat to him. And I said, I hope this is all on the books. You put the fear of God on him, haven't you? You know, I can't not stir up a honest mess. And he's gone, nah, it's cash in hand and mum and dad pay me this little bit here. It sounds like you're being exploited.

30:35And he's gone, nah, it's great because the job I get is cash in hand, mum and dad are happy because they don't get, you know, it's like, again, it was hard to find a victim that was there. Yeah. And I said to him, it's like, well, you could get more at Macca's where my boy was working for a little while. He goes, yeah, but I've applied there and they didn't get me the job. So I'm doing this. So again, it's a little bit more complicated, right? Like it's sort of like that story that I tell, I think almost everyone listening will have an experience. And it usually tends to be immigrant kind of families because they're so systemically disadvantaged.

31:13You know, it's like, well, everyone chips in, you know, until some do-good bureaucrat comes, well, actually, you need to have an employment 46B form here, and then you're exploiting your children. It's like, we're just working as a family to try and get ahead here, right? Like, you know, there's different ways of sort of framing it up. And I think when I sort of paint a picture, well, maybe not, but I think when I sort of paint a picture that way, I don't think anyone's going to get too upset with that affair. But if you take away the genetic relationship, oh oh that's different it's almost like what so i so i can exploit my own exploit air quotes my own children i can't exploit do you know what i mean it's sort of like it's just i i i'm really i'm really not super strong on it but it's my my the interesting thing about it is that we we we moralize i i think sometimes to our own detriment and there's a lot of examples i i I can tell you for, so I've had cash in hand jobs throughout my life as well.

32:15I'm sure a lot of people have. And I'm sure plenty of you out there listening have offered people cash in hand to do a job. You evil, evil black marketeers that you are, exploiters. And I'm sure not in all cases that was according to any minimum wage standard as well. It's like, well, that's different. Is it though? Is it? I don't know. And I'm just, I guess I just sort of put it out there that it's sort of sometimes, particularly when we've had, as you say, for a hundred years or something, Now we see things as obvious and inevitable and why wouldn't we? And that's how it's always been. I just don't, I genuinely don't.

32:51I'm not saying, I don't know about that. I don't know. I don't know, but I'm happy to sort of, A, because I like to be difficult, but B, you know, just to push back on what are seen as self-evident truths that once you start picking into, maybe they are still true at the end of the day, but they're not as obviously true as they immediately seem. I think that's totally fair, man. And I think on rent control, what do you think of rent control? You're against or – because I feel as though if you're against – if you're for minimum wage, you have to be for rent control. No, I don't. I'm not. What's the difference?

33:27Largely – well, it gets back to how you define the minimum wage then, right? Because if the minimum wage is sufficient, you don't need rent control. So it's – and this is what I meant about the – Well, just in isolation though. Well, I started that off as well. there's a far bigger broader problems of society. But in that narrow, you said, I'm very strongly in favour of minimum wage laws in the current system. So, yeah. I'm not in favour of rent control. Because I don't... I'm not going to let you wiggle out of this one, Phillips. No, because I don't think that's the right place to solve the problem.

33:56If rent control is an answer to housing is not affordable, rentals aren't affordable, then I would fix it in a different way. I think distorting a private transaction for property is different to making sure people get a minimum. I think I would solve – again, we've got a universal income episode coming up. I think you can solve the vast bulk of the societal problems. Speaking of efficiency and other things we talk about in that episode. Or it actually might be past that because this is a prerecord. I'm not sure. At any point, you might or might have heard it by now. Time's a quiet circle, as I like to say.

34:31Exactly. Exactly. I would, especially in a podcast world, you're probably listening out of order anyway, in which case you don't care anyway. I would solve any of those issues of affordability through wages. So it kind of comes back to that element of, by the way, rent control works nicely in Germany, apparently, and terribly in the US. So it's also probably very cultural, I suspect, depending on whose answer you listen to. Yeah, socialism works better in some countries than others. Right, exactly. It's just cultural and stuff. Yeah, so I wouldn't solve housing affordability with rent control.

35:04So that is kind of my answer. Combination of minimum wage and public housing is how I would solve it. So if they weren't available, if you're not going to fix the minimum wage, you can have no minimum wage, you should have rent control. I mean, you could probably drag me to agreeing with it. If we were saying to people, we're not going to give you enough to live on under whatever combination, so we're going to have to make housing more affordable so you can actually afford to live somewhere. Again, as a society, we either say you're on the street, you're in a tent, or I will find a way to make your housing at least accessible and affordable.

35:33And so you do it either with wages or price caps effectively. So I would deal with – I think, speaking of elegant solutions, the minimum wage is a very, very elegant solution. Just so you know, here's the minimum wage. I mean, the reason I took a harvester, mate, was – and it goes back – I was going to go back to Nathan's question. I won't answer the rest of Nathan's question, but the reason I brought it up was it was assessed – you asked who did it. I said the government, and that was both right and wrong, actually. So Harvester said a minimum wage should be set at a level at which people can afford to support a family is kind of the idea.

36:02And the Fair Work Commission, which is kind of back to the name, is what increased by inflation to maintain effectively the purchasing power of the minimum wage. So we've as a society agreed, and I say we've agreed, you disagree, but you know what I mean? We have instituted a structure or a system where we have a wage that should support the average family and can do so with regard to inflation. And if that's true, you don't need or you shouldn't need rent control, for example, if we've got those settings right. So that's kind of where I start from. If we're saying the market pays what it pays and rent is what it is and the circumstances are what they are, it's not a view I would agree with, but I can understand if you're going to say no to minimum wage, You would say no to rent control on the same basis, which is simply the market will decide and people will either succeed or fail on their own ability to earn a sufficient wage to pay the rent.

36:56So if there was no minimum wage, I would probably not go for rent controls. I would probably go for much larger public housing over rent control. So it would take a lot to drag me to rent control because there are many better, I think, ways of solving for what you're trying to solve for, which is can I afford to put a roof over my head? That's probably not a very satisfying answer to that. I think fundamentally the ideological divide between us is probably best described as you have a bias towards top down and I have a bias towards bottom up. It's probably the best way to frame it. And that doesn't mean that you're absolute and only top down and I'm absolute and bottom up.

37:37But I think as a bias, I err towards bottom up solutions where you prefer top down solutions. You know what? And it's probably the same thing. I'm probably just splitting hairs. I think bottom-up is best and where it doesn't provide the outcomes that we subjectively think. I know 2.2 decides. That's a very good question. But I'll make it about me. Let's say I'm the dictator of the world. I would absolutely go bottom-up. I'm a capitalist, right? Let prices decide where I feel like the market. No, no, no. So let me finish. If I feel like we – so we do that, right? And we say, right, where did we finish up?

38:09Right here. Okay. Can John afford to feed his family? No, he can't. All right. We either A, let it go. b provide some sort of government handout or c provide a minimum wage that allows him that allows him to do that they're our choices at that point and so i would like like with most things i'm probably more interventionist than you are absolutely but i would i would say that a market failure is the wrong phrase because it's not a failure of the market but where the outcome where the market outcomes aren't optimum based on a range of uh desired outcomes then i would intervene so i am more interventionist than you are for sure i wouldn't say i'm top down um i mean it's It's all definitions and we can argue about it.

38:45It's not really that big a deal. I would start with bottom up and I would fill in the holes rather than mandating the size of the hole, if that makes sense. I know it kind of feels like the same thing, but I think it's important because I absolutely believe in letting competition do its thing. And then, for example, intervening where competition isn't working. Okay, again, referee on the field, rules of the game. That's kind of where I'm at, right? It's like, okay, you did that. That worked. You get paid$800 a month. Turns out you need$2 ,000 a month to live. either we say sucks of you or we say we will, with a range of outcomes, intervene to bring you up to a level that we think is a decent standard of living.

39:19And I just think minimum wage is the easiest way to do that. Frankly, back for what it's worth, if we said, back to UBI a little bit, I would be okay with a system which said no minimum wage, but we will top up any salary to a minimum amount through taxpayer funds and tax rather than make businesses pay it, if that's what we've decided to do. But then no business is paying more than three cents an hour, right? Well, that's the thing, right? But that's kind of the world we're in. So it's kind of – or you – because the other alternative is sucks to be you, good luck making do. And even the Yankster do that.

39:49They say, well, he's a minimum wage, but we'll throw in food stamps and we'll throw in this and we'll throw in that. I think the evidence is if we believe that a living wage is what it is, i.e. the ability to support a family, and you're not being paid that much, you can't support the family, so you're in the poor house or relying on charity, or we say we will step in to make it okay. So why not under that? I agree, actually. The way you've laid it out is nice. So in doing it that way, I would say no minimum wage. Whatever you feel will attract the necessary labor and talent that you need for the job.

40:23If someone out there is happy to accept it, it's great. And then we top it up with a more broad-based welfare system. Like, why not? Your point is I won't pay any money, though. So I think your criticism or your challenge was fair. But, yeah, I'm very happy. If we thought we're just working on a go, beauty, I'll pay you nothing, government's going to pick up the tab, which is probably what happens. But otherwise I agree with you. I'm not about minimum wage. I'm about the household receiving sufficient income to support a family and whatever. That's as a starting point. People assume if you're against minimum wage that it's just like you're pro-poor.

40:55You don't care about the results. No, I'm not. Or like was it a discussion on hard money? Oh, you're anti-well. I was like, why? they're completely compatible if you want to go that way it's yeah it's it's a false dichotomy and so yes and so i really just before everyone listening to this podcast thinks i'm an absolute soul as evil wants to like make kids work in salt mines i don't i don't at all but it's just like again that price that price mechanism super super powerful right and i i just feel if if there are two people that are happy to have made an agreement and happy to do it and no one is being forced against their will, and you know what I mean, then why am I going to get in the way of that?

41:34Now, if it turns out that you do all of that and it's still like you can't put a roof over your head, am I anti-welfare? My God, no, I'm not. I'm anti-buggering around with market prices in the name of fairness, equality, equity, whatever word you want to use, when we know without any doubt at this point in time that there's a whole range of very difficult to foresee second, third order unintended consequences where sometimes the medicine's worse than the disease, right? And it's sort of like just by saying, too often I come across the argument and it seems to be it's like the only way that people win it is by saying, I'm a more feeling, caring person than you, therefore I win.

42:24I better than you. you know it's like well you're not because what you're actually arguing for on an aggregate you can everyone can point to an example to prove anything but on an aggregate basis if we like again the the argument would be on an aggregate basis there's just far far fewer jobs and there's far fewer jobs it's been there's far few businesses that are profitable at certain levels so there's far less economic activity and value creation and people following their dreams and working hard to get ahead than there otherwise would be because of minimum wage laws but it means that there's less poor people so are there less poor people i don't know like you're asserting that and it's like oh but it's evil otherwise well is it what we what there's no other option that we could we couldn't plug to your exact point we couldn't plug that hole in in a far more straightforward clean way that doesn't distort all of these signaling mechanisms and again not because i just everything should be hyper efficient i just i just think i'm free to choose there's a more efficient solution.

43:22The more efficient solution is always that for a given outcome, you always choose the more efficient way of getting there. That is logically and absolutely always true. Here's the other thing. Words are funny, right? No one's against internships. No one's against work experience. What's that? That's slave labor. You don't get paid. You do not get paid for an internship. I did work experience in year 10. Kids do it. Now you don't get paid for it. Is that exploitation? Oh no, it's great because you're learning skills and you're do-do-do-do. It's We use a different word. It's a little bit different, right?

43:52Just because someone's going to ask it, I just looked it up. It's actually illegal to have unpaid internships in Australia. Work experience is okay and unpaid internships. Oh, that's changed then. Yeah. This is from the Fair Work Ombudsman. Again, not to correct you just because someone's going to yell at the pod machine. The point stands. Totally. Work experience stuff is totally. By the way, the other option, I don't want to open this necessarily, but I will because it's interesting. Given we've talked a lot about housing, including in an episode that we recorded, that we published, was our longest episode on the 12th of June.

44:18Which is a record that we had broken every week. Because excessive weeks in Trapperconshire. I'm not entirely sure. We'll find out. Motley Fool Money. For more, subscribe to the free newsletter at fool.com.au forward slash listener.

44:34We talked about housing and kind of the role of housing in incomes, right, or expenses. And the other possible I've heard is suggested. I haven't looked or thought super deeply about this, but it rings. It bears some thinking. You're talking about, you know, engagement. We are going to distort the market somehow by supporting someone who can't support themselves. A welfare payment is a distortion. It's just a different type of one. And one option would be actually just to flood the market with public housing. Yep. Because if you're either at really cheap prices at no profit or at a subsidised level, which is kind of a quasi-rent control, but to your point about how do you fix the – businesses pay what they pay whatever they want to pay.

45:08If housing is – if rent is$200 a week rather than$800 a week, then that fixes the livability question rather than need to do it with wages potentially. And I don't really have a strong view of which one of those is better, whether it's a welfare top-up, a minimum wage, or public housing, I'm sure there's others. But, yeah, they are very different ways of addressing the same sort of problem. Yeah. Potentially. Not that we should understand. No, not that we should, but it's just like you'd always be careful when we say when we do, we flood the market, who's we? I assume the government. And then if you mean the government, it's like, well, who?

45:39Someone's got to build it, right? Like the government doesn't employ people. Not necessarily building, you can just buy it. Right. With what's money? Tax money. Right. So it's us then. But it's all us, right? It's either the business or it's a taxpayer pay-off fee. Yeah, exactly. Yeah. I'm never going to let that opportunity slide and not make that point because too many people think when they say the government should, it's just like this free unlimited money. Well, I guess in a way it is. But it is like we can choose to do that, but it's like we are still subject to the scarcity of resources and the coordination, all of that kind of stuff.

46:13And it just assumes that the government can go and do it and they can somehow do it at a far, far cheaper price than they really should. They've just never been able to demonstrate that ever. So maybe it's not something to hang your hat on. I'm being silly on your example, but it is sort of like that example. There's a lot of examples that get thrown out like that, but there's a little implicit sort of assumption in that that actually all of that could be delivered in a way that was actually better than what we're already doing. And I don't know if it's always true. No, I'm not sure though. But my point is that if we start with people should be able to afford to live, you either reduce their costs or you increase the incomes they receive and those incomes are either reduce it or not either.

46:50Three options, I think. Reducing housing costs, increasing the minimum wage or providing some sort of supplementary welfare payment to top up the incomes. Just quickly on Nathan's points too, mate. We'll try and move on. But Nathan, I looked it up actually, mate. Stop asking interesting stuff. Well, he did say there'd be lots of rants. Interestingly enough, the minimum wage has actually fallen as a proportion or a percentage of the median wage. So, in the context you were sort of saying, Nathan, your view of things were getting squeezed between the low incomes and higher incomes. The evidence per Google Gemini, so again, I haven't looked at the sources, so take it as read.

47:27In the 80s, apparently, the minimum wage was about 65 % to 70 % of the median wage. In 2026, roughly 55 % to 60 % of the national median wage, which I don't say is either good or bad necessarily. But you made the point, Nathan, I think that it was kind of compressing. I don't think that's the – the evidence seems to be not – that that's not the case. for what it's worth. So maybe your experience is different, Nathan, and like everything we say all the time, averages and totals are indicative and interesting. They're not every job, every industry, and every geography, but that seems to be the number.

47:55So maybe the assumption you're making might not be spot on. In terms of the immigration thing, we are absolutely, I should say absolutely, I think it's reasonable to assume that wages are lower because of high immigration than we'd be without that immigration. You talk about market price all the time, Ram. If we didn't have people say, who's going to wipe the bums of the people in the nursing homes? Who's going to drive the taxis? All the usual kind of tropes that we drag out. The answer will be the person who has offered enough money to go and do that job. So at some level, you know, if we are bringing people into the country, and I want to be really careful not using any of this pejorative stuff.

48:30I'm using them accidentally, mate, call me out and I'm bringing people in. I think it's okay. If people are coming to the country, and as you mentioned, Nathan, they're prepared to work for less because it's, you know, less than me is more than what they were getting somewhere else, so they're prepared to do my job for less. I don't blame them, but I suspect it's probably reasonably true. If we didn't have immigrant nurses and pick your other industry, it doesn't really matter, who would do those jobs? The people who were paid enough to do the nursing degrees and do the jobs is the answer. And so, honestly, wages would be higher, and yes, that would cause inflation, that would cause wage inflation, and there would be absolutely consequences to all that stuff.

49:02But I think you're right. I think you're absolutely right. I would say almost unchallengeably right. I'm not going to say absolutely because who knows, but it seems obvious and likely. Well, it seems likely, right? You've got to disagree.

49:16Well, some parts of it, yeah. I mean, you say it's obviously inflationary and all of that kind of stuff. Again, they're - Having to - If you had to pay more for the same job, you'd put pressure on prices, surely? Put pressure on that price. Yeah, yeah. But then - Price of pencils and Teslas? I don't know. I don't see how the price of a nursing - The average wage for Australia would be higher under that scenario. And if that was true, I don't see how paying people more, unless it came out of profits and companies made less, which is the other alternative. I don't see how it would not cause prices to be higher.

49:51Now, maybe not in the long term. But you're going to be circular though, right? You're paying more and receiving more too. Which side of the ledger are you talking about? If you give every nurse 20 grand more because you have to employ Australian nurses rather than English nurses who come across to do the same job and nothing else changes because you need the nurses. You're not producing more. you're just having to pay a smaller workforce or a less large than would otherwise be the case workforce. We're redirecting capital. Yeah, absolutely. We're redirecting capital. It's only a higher price because it's the government who pays the bill and the government pays it with debt and printing.

50:18That's the inflationary part. Okay. So put aside the monetarist version of inflation. The real version? Okay. Is it not likely slash almost certain that if the same pool of workers were paid more next year than this year, that prices would be higher because supply wouldn't respond as quickly? I think that doesn't seem controversial. Yeah, yeah, that's true so so let's let's follow it through so it's just like why are we paying nurses more because all of a sudden hospitals feel generous no they can't get the staff so supply and demand i'll pay you more okay and they'll keep doing it until the point that they can get enough staff and then and then the that we will we will reach some form of temporary equilibrium right um and and and at some point the nurses they're doing their job and they go wait a second it turns out that if i work for the fire department, I can get three times as much.

51:05Why this is much more of a demand, I'll switch over there. That's why all of this stuff is so super important, right? Because it's actually rather, it's the invisible hand argument. All it's just saying is that there's nothing wrong with paying people more if that's what needs to be done to satisfy that particular demand. I need nurses, all right? I guess I'm paying more. And fine, all that means is that we need more nurses, until the point at which we don't, until the point that it actually turns out that podcasters are in more demand and we need to pay them more. Absolutely. I completely agree.

51:40Do you know? Let's pay nurses more. Yeah. It's complicated, but you're right in a narrow sense that, yes, it puts up prices and that, but it's not like, that's why I think it's important to have a thorough, proper understanding of what inflation is. Inflation isn't prices going up for one particular area. It's just not. Oh, we keep arguing the pedantics. We'll move on. Because I think when we have different definitions, neither is necessarily right. It's just my definition is one and yours is just another one. And neither is right or wrong. It's just a question of how you choose to measure it, what you choose to call it.

52:12Okay. So next Boxing Day sale, we're going to talk about deflation. Only if the price are lower than they were the previous year. And then we absolutely can do, yeah. Okay. Yeah, totally. If I get the TV for$100 and it was$150 last year, then price is deflated. Absolutely. I completely agree. okay alright let's move on TBC TBC TBC what was the we'll come back to it what else do I think that was it for Nathan's question population minimum wage yeah I think we've done so hopefully hopefully I don't know hopefully it answers your question it doesn't hopefully we've addressed your question in a way that was at least useful Nick says hi it's Scott and Ram first time listener first time sorry long time listener first time emailer that's good for years I have walked among ordinary investors, the lost, the leveraged, the perpetually wrong.

53:00But it was your wisdom that finally parted the clouds and revealed the path to financial enlightenment. Where lesser minds see noise, you see signals. Where the masses panic, you sip your coffee and calmly identify the next 10 bagger. He doesn't know this. We actually are mostly drinking coffee with this podcast. That's pretty right. The market does not move you. You move the market and it thanks you for the privilege. That's Chuck Norris, actually. Poor Vale. I like Chuck Norris. Maybe the old Chuck Norris jokes. They were always good. They're the best jokes. The best. You moved the market. Thanks you for the privilege.

53:33Very Chuck Norris. I am convinced that somewhere on the floor of the ASX, there is a small shrine in your honour, attended nightly by grateful index funds. It is in the spirit of boundless gratitude and only slightly diminished composure that I write to you today. I am one of those bastards. Yes, you are, Nick. Coming up on the big 3-0. How much would you give for 20 more years, mate? Anything. Everything. It just feels like yesterday and then I do the best. Oh, no. I don't get so depressed about it though, right? Because I was just like, I know that in 10 years' time, I would also give everything to be 50.

54:14I've used this line, Mal Leyland of the Leyland Brothers. I've mentioned this on the podcast. One of his lines is, you'll never be as young as you are today. Yeah, it's a great line. Which is a nice one. Brilliant. All right. Having nearly listened from the start, you two have set me on a great path to staying the course. I decided a few years ago to stop stock picking and go fishing. So I sold out all the positions and bought a broad-based ETF or two to see me through. And yes, that did include selling a large portion of NVIDIA stock in 2019. Oh, at least the fish tasted nice, says Nick. Thank you, mate.

54:44It's very kind of you to not throw things at us. Thank you. Thankfully for me, the market has been very strong and a nice nest egg has built up. I am now at a point where my portfolio would be a great starting point on a house deposit. I just have that nagging word in the back of my head, compounding. I know if I continue to dollar cost average into our portfolio, it'll be massive, in brackets hopefully, later in our lives. So my question for the both of you is, how do you handle the opportunity cost of housing versus shares? I remember Ram's many rants on the rental market. Does it purely come down to a lifestyle decision between my wife and I?

55:21Or are there other issues that I may be missing between financial security and housing security? I know from discussions with my mates, there's a real worry with our generation. Hopefully the question helps shed some light for the younger audience as the Friday and Sunday are appointment listening in our household. Well, for me anyway, I'm still baffled my wife isn't as keen to listen to you two middle-aged white guys talk about finance. Thanks, Nick. Thanks for all the guidance over the years. You're like white guys have the answers to everything. Don't you know that? Sit down and let me tell you about it.

55:48Let me tell you why you're wrong. Let me mansplain exactly why. Give me a chair at the end of the Christmas table. Give me a couple of bottles of beer and a couple of glasses of wine and I will explain the world to you, Nick. I shall hold court, as I like to say. Exactly, exactly. How's it shooting us to finish security? Two minutes before our hard finish. Were you aware of that? You weren't, were you? Well, we were seven minutes out of originally. I was like, if we cut it off really, really short, it feels too short. If it goes too long, we're in trouble. I'm going to do a radio interview after this is the pulling back the curtain answer to this one.

56:19So you've got three minutes, Ram, go. Yeah, I mean, it makes an immense amount of sense on paper because you will all just relying on averages, you know, you'll probably get a better return. The two things that will throw you would be the degree of leverage that you can have on housing that you can't comfortably have on shares, which is a disadvantage for the share side of things. And the other one is what I've ranted about long and hard is that where theory crashes into reality is when you get kicked out of your house every 12 to 18 months because they can. And that throws out a lot. Once you've got all the moving costs and the emotional burden and the fact that you've got to have, you know, black mold in your lungs and ovens that don't work and all of this kind of stuff, it changes the calculus very quickly.

57:07So in spreadsheet land is one thing. I know other friends of mine who have rented from the same landlord for eight years in a row. They've got a wonderful relationship. They're absolute brilliant. Two-sided relationship. Everyone's sort of winning. So it depends on your – if you can find something like that, stick with it. If you can't, then don't. And I don't know which path is going to be the one that you're on. So that's a completely unhelpful answer. There you go. I'm going to do a ram and say, well, not both, Nick.

57:39maybe you can't do both. Maybe the housing is all you can do and including repayments for the next 30 years. And in that circumstance, I'm back with Ram. Very likely for a 30-year-old. Right. So it's brutal, Nick. Compounding on shares will almost certainly do better than housing over the next 30 years, I suspect. I don't know how it can't for the maths that Ram's talked about before. So stick with that as an idea. And I think you're in a pretty good place generally. really. The question on how we think about the difference for me is I've just talked before about mortgages for saving, which is really useful.

58:16So it means you can't skimp on the shares if in one month you want to spend on something else. Like, well, I've got to pay the mortgage, honey. Let's go and do that, which is really, really useful, I think, because in 30s, you will own a place outright and they can't take it away from you. It's going to be worth something. And there's financial security as well as housing security in that alone nick um so that that's a that's a benefit uh and rev's point about moving regularly is i haven't had to i've owned my place for quite a few years now and um i don't miss having to move every time a landlord changed or the rent went up or something else happened so i don't blame you mate also depends on what you do with the family and you know so your wife and i if you're gonna have kids if there's other stuff going on then you'll want a place i suspect um the one thing i will say and why i probably would lean towards the house actually, weirdly enough for me, is if you decide, I don't know what's going to happen with house prices, but if house prices grow faster than your ability to save, then you're kind of getting further and further behind the eight balls, it gets further away from you.

59:08Now, if it doesn't, you're no worse off because you bought. If it does, you're chasing something that's getting further away with every step. You move one step, you move 1.1 steps and you get further and further away. Unless you can compile that deposit faster than house prices rise, proportionally with the leverage we have talked about, then you're going backwards and that's always going to be a challenge. So I think that's probably the biggest issue you're going to have to deal with. Yeah, we can't help you, mate, but hopefully that's some stuff to think about. That was 4BC. I'm going to take that call.

59:34And that's all. We speak on Friday. Fool on. Cheers. The Motley Fool and people appearing in this program may have positions in the companies mentioned. General 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 Licence 400691.