Mailbag: incl. Is it time for Motley Fool Money, 'uncut'? January 7, 2024

0:10Welcome to Motley Fool Money, our very special Sunday Mailbag edition. it might be a new year, it doesn't mean it's not special. And it wouldn't be anywhere near as special unless I, Scott Phillips, was joined by him. Andrew, I think Sir Andrew, Lord Andrew of Page. That may again be an upcoming episode. If so, we've given you an Easter egg for later. How are you, mate? Good. I'm glad you remembered the Lord. It was very important. Contractual, even, you could say. Let's not pull the curtain back too far. other than to say uh i've had to i've had to sell my soul to this podcast all i'm saying uh you uh you do what you you do what you need to do mate um should we just get into it i'm i'm ready i'm i'm hot the truck let's dive on in because uh well speaking of speaking of titles speaking of names andrew wrote in not you andrew as far as i know uh he says hello professor phillips and dr rant page how come you get a how come you get a higher qualification depends who you are depends who you are you know how surgeons are called mister have you heard that I didn't know so apparently surgeons it's offensive to call them doctor they want to be called mister and apparently goes back to some historical thing so if there are any surgeons listening people feel free to let me know but apparently that's the story there's some weird doctor mister thing about that which you know I didn't know that and I didn't know that surgeons had such fragile egos at the same time so there's two things I've just learned thank you and part of our audience goes with it so that's good to know Henry says love the pod I look forward to listening to it each Friday and Sunday, especially for Scott's dad jokes and Andrew's fist shaking at the sky.

1:47Andrew, this is what we call Stockholm syndrome. Speaking of medical professionals, you possibly may need to look that up. The problem is once you've got Stockholm syndrome, you don't want to not have it anymore. So that's why it's so insidious, right? Anyway, he says, as a mid-40s father of two young kids, I could certainly relate to and enjoy both. I do have a question for the mailbag, but first, a suggestion. The suggestion is for a special adults-only uncut episode of Motley for Money, sponsored by both Treasury Wine Estates and Endeavor Group. It would basically involve the two of you recording a fireside chat one boozy Saturday night after a barbecue and the consumption of a choice selection of the aforementioned sponsors' beverages.

2:31Topics could range from Bitcoin and AI to climate change and residential tenancy laws to Australian residential property. I'm sorry, to is Australian residential property a Ponzi scheme? No investing topic would be taboo. It would make an interesting, thought-provoking and perhaps controversial episode. Imagine the five-star reviews you'd generate. Now, Ram, firstly, if you're listening, Treasury or Endeavor, we're open to sponsors. So please get in touch. You've got my details. You know how to get in touch with me. So never let it be said, we're going to knock back a sponsor, particularly one that can provide us with aforementioned adult beverages.

3:07Second thing I'd say, not to you, Andrew, but to the questioner, Andrew, the listener, Andrew, is the topics you highlighted are the ones we rant about already. I was going to say. Are you not entertained? Have we not delivered? Maybe a little more blue. I wonder a little bit how much more unhinged Andrew thinks we would be if we were a couple of sheets that we'd make, because I don't think we hold back particularly at the moment. And so the language may change or the rants may go for longer. I'm not sure. And a lot more F-bombs probably. You'd get a fair whack of that as well. Gordon Ramsay meets Motley Fool Money.

3:43A hundred percent. I love the idea, but it's so extraordinarily dangerous. I can't tell you the number of times that we say our farewells over Zoom to each other and then I go and make a coffee and think, did I say that? Should I? And if there's anything that alcohol is going to sort of accelerate, it's that next morning regret. I feel as though, yeah, it's just very dangerous. Suffice it to say, it probably wouldn't be broadcast live. That being said, let me put something out there. I think it's the first bar back of the new year. Let me put this out there. We, Anne and I, have toyed with possibly doing a live recording, maybe not a boozy one, although we have toyed about doing it at a pub, A live recording of Motley Fool Money.

4:27A Motley Fool Money live, if you like. Now, I'm in Barrel. He's in Sydney. So it's probably going to be somewhere, you know, around the greater Sydney area. If you're interested in that, let us know. If you have venue suggestions, let us know. Frankly, we're not going to be paying a lot of money, nor are we going to pay, as much as we love our listeners, to pay for a venue hire. But I can imagine a scenario where maybe we're both sitting on stage with a brewski in hand. uh i i'm i here's the other thing that around i'd have to find a pub that didn't only serve ipa it's speaking my old man fish shaking at the sky why every new bloody beer has to be an ipa an xba or a summer ale for god's sake we have enough of them um so if there was a two is old or guinness that's the sort of pub i might be at i don't know that you would partake of the same liquid refreshments would you uh look i i've got plenty of time for an old and uh and uh guinness but i I am very partial to the modern craft brew as well.

5:21Bloody pale ale. God. Yeah. They're good. They're good. They're tasty. Shout out to a local brewery down my way, Eden Brewery, does a really great lager, a really great Mexican lager. So there you go. I tried that the other day. Okay. Again, I had a barrel of food and wine festival turned up and said, oh, what would you like? He's like, pale ale, pale ale, pale ale, pale ale lager. I was like, I'll have your lager, please, mate. And a really, really good. It was very, very drinkable. So, yes. I was supposed to say sessionable these days that's the cool way to say drinkable isn't sessionable ale sessionable who's having a session so it's sessionable it's like you can drink it apparently oh there you go yeah I'm never going to say that word again mate let's move on because Andrew says on a more serious note I do have a question for the mailbag oh dear we talk about a potential potentially large losses in the share market but there's nothing like a nasty divorce to halve your asset base in one fell swoop no that's true in recent times he says, I've noted a few higher profile separations linked to listed companies.

6:20For instance, Jeff and Mackenzie Bezos, Bill and Melinda Gates, Kerr and Judith Nielsen, Hamish Douglas and Alexandra, Twiggy Forrest and Nicola, and most recently, Mike Cannonbrooks and Annie. My question is, do these separations have an impact on the share prices of the associated companies? And is there an investment opportunity from a share price falling, for example, because a former spouse is selling a large portion of their shareholding alternatively would it be a potential red flag for the company in that the physical and mental stress of the relationship breakdown affects management and business decisions many thanks in advance for your reply and keep up the great work on the pod kind regards andrew andrew i love that you're trying to profit from other people's misery mate that's very no i'm kidding okay um mate let's start with the first part of the question uh is there an opportunity uh if when when the former spouse is selling things are a bit messy i don't think so and if the answer is yes then it would be a very small hard to spot hard to exploit one would be my instinct um people who are selling large blocks of shares tend to do it over the counter or the you know otc in the parlance of the industry in In other words, they don't go to an exchange and just dump a market order onto the market or even put a limit order.

7:43They'll go into these dark pools and it sounds all very conspiratorial. But it's just there are cross trades, block trades. There's all these things where basically you say to a broker who caters to this kind of thing, I don't want to sell a very substantial parcel of shares. and they ring up fund managers and big institutions and say, hey, if you want to acquire some of this in one go at one price without having to worry about liquidity issues on the market or in fact even signaling what's happening on the market, here's an opportunity. And again, I can sell you my shares at any price I want.

8:21We can do an off-market trade right now. Well, not right now, but I could download a form, fill out my part, send it to you, And I could say, I'm going to sell you, you know, or you're going to sell me all your Solpat shares for one cent each. If you want to do that, you can. So maybe there's a lower price on offer to get it across the line, but you're generally not going to see it play out on market, I don't think. I think you're right. For exactly the reason you highlighted, mate, it's the off-market block trade. generally speaking at a slightly discounted price, right? Because that's the price of getting these shares sold.

9:00So$8 share price, you might do a deal for$7.70 or something. So take my 4%, 5%, 2 % and get rid of it. The other thing, by the way, for... The part of me does, you know, the part of me that wants to be fascinated by this stuff, does want to kind of know what goes on behind closed doors. But almost always when these things happen, the split is, if not amicable, you say nasty divorces, there's some nasty circumstances. It does fascinate me the way that these things get managed reasonably. And it seems to me, speaking of Stockholm Syndrome, there is a bit of that. Even when there's infidelity or alleged infidelity, you're kind of like for whatever toys get thrown out of the cot in private, the public shareholding is almost, I think I don't remember the last time there was a nasty selling off of anything.

9:38Even the Jeff Bezos and the Bill Gates stuff, you know, nasty, nasty, nasty personal stuff. But kind of they say, okay, well, now I'm holding my shares and I'll do this, I'll do that, I'll do the other. The only time you would see it, mate, is if the market felt like the breakup up and subsequent sale would meaningfully impact the way a company was run if it was going to for example somehow jeff bezos lost control of amazon and some corporate writer could pick it up and change the strategy or something then you kind of get something there other than that if bezos is still there we still got a big shareholding you're still gonna keep running the company his why you kind of go okay well nothing to see here so it's as as always the market only reacts with lower prices when it sees so price only change when the market sees something that's changing sees something that's different, sees a different opportunity or risk or threat.

10:21Generally speaking, I can't remember the last time that was true from a corporate divorce, really, honestly. Some cases there's escrow. Some cases the splitting partner commits to holding the shares. Often those shares are voted together. There's normally an agreement from the non-business spouse, generally the woman and the examples you've given us in most cases, that the, you know, the kind of the spouse's shares will be voted by the business owner or business founder or business manager in the business. Not always, but often. So yeah, it's just rarely, rarely an issue. Andrew also asks, mate, would it be a red flag given the physical and mental stress of the breakdown?

11:02Is that something you worry about? You think, well, hang on, maybe this person's preoccupied or not quite bringing their A game or something else is going on? Yeah, well, it's interesting because you never know what's happening behind closed doors. You could almost make the argument that the divorce is now we've got some clear air because there's probably been a whole bunch of tension and angst within the relationship for God knows how long. And you are now seeing the point where both parties hopefully amicably go, oh, thank goodness, that's behind us now. Now I can focus on the business. What you don't know out there in the public is that actually the last two years have been me preoccupied with fighting with my other half, with seeing marriage counsellors, with talking to lawyers, and now that's gone.

11:46So if there is an impact, and I look honestly, I think anyone going through such a stressful and hurtful, frankly, ordeal is going to be distracted at some level. but if you think about it um i suspect that the divorce is actually the point at which is just sort of like it just sort of puts a pin in it you know it puts up a period behind everything go boom okay i'm with my life um so i think you could look at it that way i think that's probably right actually mate yeah i think i agree um yes it's you know what's funny it's it's kind of that something once something becomes public we worry about it despite the fact that in private that's been happening the whole time anyway as you rightly point out i will say um jeff bezos relatively subsequently decided to uh take up with the the lady he was seeing uh has moved out of the ceo's role and is off doing kind of you know jeff bezos-y stuff um so there is there is probably a bit of a potentially a i won't say midlife crisis but no i don't mean about jeff either but there may be some sort of reassessment of life of a second wind uh in terms of you know trying to impress the new spouse or whatever else goes on with with breakups and new marriages and affairs and that kind of stuff so i don't i don't it's possible i suppose um it doesn't really it doesn't really worry me i have to say um i mean it's yeah it's a big deal it's a big deal i had noticed mike canbrook's a whole lot less public uh on some comments and social media stuff recently and whether that's to do with the divorce or not who knows and it's probably not really my place to speculate um also atlassian share price have been falling so maybe he's doubling down on that i think that's you know there is one of the things i talk about a lot is the other like it's a bit like something like but also very like the old share purchase plans right someone says something in the mail you think oh there's a thing now i have to act on that i have to respond to that it's i wasn't thinking about buying more worldly shares but having a share purchase plan so maybe i should buy some more shares oh look it's three percent cheaper than what i could have got on market right and so it changes your thinking you but you're drawn to think about that thing and so the same with the divorce like oh such and such divorce now frankly again without naming names and and whatever um you know someone who might have been having an affair for the last five years and trying to split their their time between the wife the family the business and the affair you know the stress of that being over at least as a clandestine thing or having to hide that or having being preoccupied we're trying to manage you know keep three or four plates in the air rather than two or three um you know those things those things do matter so just because we know about it because it's a thing um i wouldn't you know we could have and again god forbid but We could have execs with children in hospital or, you know, dealing with a family member who's crook or a mother who just died.

14:21Or, you know, we don't worry about those things because we don't see them. And yet we kind of see the divorce reported and we're like, I wonder what that must mean. And we kind of, we feel obliged to take a view. I think sometimes it's worth just saying, yeah, it's probably not relevant. And, you know, compared to things we don't know that are still going on anyway, the other dozen things or so, probably shouldn't overweight it just because it gets reported in the paper. Yeah, I also think the really great companies don't – I mean, key person risk is a thing, right? There are some real rainmakers out there that would not be the same without that person at home, and I get it.

14:55But the really good businesses have lots of redundancies and stuff in place for the proverbial bus that comes along and wipes you out. But, you know, it has long been theorized what happens to Berkshire when Charlie and Warren are no longer there. Well, one of them's already gone and that didn't really seem to have an impact. And I don't, you know, is Berkshire the same without Warren there? No, it's clearly not. Is it something that's going to be a disaster? I don't think so because there has been decades of preparation and investment in culture. And so this isn't a guarantee. In fact, it is guaranteed that most companies are not as well planned and far-sighted as that.

15:40But I do think that it is probably a negative if the only way this is a good investment is if person A is at the helm. Yeah, that's right. Again, speaking of Buffett, you want the business a ham sandwich can run because one day a ham sandwich will run. What's the other saying? When an industry with a reputation for being terrible meets a management team with a reputation of being brilliant, it's the industry's reputation that remains intact. So you want absolutely very capable, aligned, talented people running the show, obviously. obviously but to me it is it is more important to have a very attractive uh business structure model um uh competitive position etc etc moats um than it is that they have that i mean i'll have both thanks if i can if i can choose and i can unfortunately because there's lots and lots of options that are out there that's right but that's just something else to think about as well yeah nicely put mate george sent us an email and said hi scott and ram i've only been listening to your podcast for a bit over a year and felt i have learned so many things i didn't know i didn't know thank you mate first some context i'm 22 bastard and my fiancee 20 and i are expecting our second child in april we're both from farming families and have worked hard from a young age and we're expected to be able to buy a modest home sorry we did buy a modest home last year well done that's impressive two kids and a home under under 22 and 20 well done this year we have taken on a new job, managing a motel, and have moved into the residence.

17:13We've decided to rent our house out, but wanted to hear your thoughts on renting it out versus selling and investing the money instead. I know Ram has repeatedly said he would not invest in real estate and wouldn't intentionally do it, but I feel by owning one house, we stay in the game, and therefore, regardless of what happens with the housing market, we will hopefully be able to sell our old house and buy a bigger one in future. He also says, P.S. Ram, if you'd like to move to a beautiful town on the border of New South Wales and Victoria. We will gladly rent you a perfectly working house for a more than reasonable price.

17:46Looking forward to hearing your response. Yeah, it's a beautiful, beautiful part of the country. Yeah. Look, it was up to me. I'd be there in a heartbeat. Yeah, that's right. In a heartbeat. We don't always make our own decisions. Looking forward to hearing your response. Full on regards, George. There's a lot in this question, mate, funnily enough. Yeah. Can I clarify something, though? I feel like I get misunderstood, which is my cross to bear. I fear you may actually be perfectly understood, which actually may disappoint you more than otherwise. But go on. Let's presume you're misunderstood and let's explain why, shall we?

18:19Too many people write in or just in general in my life, because, oh, you hate property. I don't know how many times I have to say. I don't. I really love property. I think property is one of the best asset classes around. I just happen to think that Australian property, at least in the capital cities, at this point in time, happens to be obscenely overpriced. It doesn't mean that the asset itself is poor. And I'll make the distinction again, like having somewhere to live is a very different proposition than having an investment property because, you know, I get to enjoy the utility of the asset.

18:49So it's just a little bit of subtlety and a little bit of nuance there. And if I could find a house that was yielding me 5%, say, gross rental income, and I could do that without stretching myself and make sure that the net yield after costs and that was still reasonable, I'm all in. Sign me up, right? Exactly, yeah. So I just want to make that point. Why can't you sell the house? And it's not a – it was a very telling statement in there, in the game, stay in the game. Now, I know I don't want to overanalyze this too much, but it is – Sure you do. Well, the language is always interesting here.

19:36No one in the media can open their mouth without saying getting on the ladder or getting into the market. I'm in the market. You are not in the market. If you are currently buying or selling, you're in the market. Otherwise, you own a house. You're not in the market. I'm not in the share market because I've owned Berkshire shares for 10 years. You're not in the market. You're a shareholder, right? I know it seems like a really pedantic kind of point, but I think it belies the - Language matters, mate. I'm 100 % with you. language matters a lot it implies that this is just a speculation i'm in the market and i can do this and i can flip this and i can make this and i can do this and it's just sort of like whatever happens to having buffett talks a lot about you want to own something that if the share market closed for 10 years it wouldn't matter and that that blows a lot of people's brains like what why would i buy shares if i can't sell it and the very excellent point that he is making is that there is an intrinsic value to being an owner of that business.

20:33You know, there are lots of private businesses you can't buy and sell shares in. But you know what? You would love to own them because they gush cash and they pay the owner's dividends and salaries. You know, the value isn't in the I can find a greater fool to flip it to. The value is intrinsic to the thing. And that's the great thing about owning a home. It's just sort of like whether I can sell it or not. Who cares? Who cares what the market price is? Can I afford this without being overly stretched? And do I get to live in it and not have to have an argument every time I want to put a poster on the wall or a light bulb needs changing?

21:11That is so immensely fundamental to the whole thing, right? And that's also my problem with the term ladder. It's like you must ladder your way up. And it's just like buy, flip, buy, flip, buy, flip. It's just sort of we're all a little bit mad. And dear listener, I'm using your very reasonable comments as a launching pad. I was going to say, you started my saying, I think I misunderstood. And then that quickly ran into a rant about it. Sorry, sorry. It's just, it's really, it really gets under my skin though, as you can tell. But why not? I don't know the situation. If that house is free and clear, like there's no mortgage against it.

21:55and there's no mortgage against the business that you now own or loan against the business, I guess my consideration would be, well, what am I getting in terms of my rental yield? If I'm getting a really – and in the country, it's a very different story into where Sydney are. But if I'm getting a decent yield, probably keep it. Probably keep it, frankly. If I'm not or it's just causing me grief because of the tenant situation or whatever it happens to be, and I can just like put my money in a term deposit for the next 12 to 24 months and get five or 6 % that way, risk-free, I'd have to ask myself, why wouldn't I do that?

22:34I think people are naturally reluctant to do it because their lived experience is, if I do that, it will run away. I sell my house for a million dollars, two years time, I decide to get back in and the same thing is now$2 million. So whatever you do, don't get out of the market, Don't get off the ladder because if you do, then things just whoosh by. And that's not unreasonable given the experience that we have had. So you need to have a view on that. You probably guess what my view is. I don't think you are going to see things double in the next few years. Of course, the way the universe works is it's almost guaranteed to do that now, especially that I've said that.

23:11But if you're not expecting fairly significant and near-term growth, then you can park that money in an alternative asset. No, I'm going to be careful of my language. In a different asset, whether that be shares or whatever, that giving you a better use of your money. And then if you decide that this hotel game is not for us, I'm sick of it, I want to get a house again, well, then you can buy a house, right? Like it's not one door. That door doesn't close forever. And I know that feels reckless because that's actually been our case. We owned a house, we sold it, and now it's impossible to get back to where we were just because things have moved so much.

23:50So believe you me when I say I get it, I get it. The other thing I would say is if I did have a bit of a loan on the house and on the business, there is a great deal of peace of mind that would come from just selling it and being in a much lower leveraged position, especially when you're running a small business like that right as well that is a lot of stress to to to carry on your shoulders of trying to make this business work trying to grow the business trying to make it a better business and and not being worried about how you're going to make the next mortgage payment all the way like that is that is right up you you know the top three we talked about divorce before i think divorce moving and financial troubles are the three biggest causes of stress in the modern world.

24:42It used to be being chased by a lion and stuff. But in the modern world, it's those things. And I just feel as though that you don't, you want to give yourself an ulcer and have all the, in fact, it's going to impact your relationship as well, right? So it has all kinds of big ramifications. And I personally would urge more towards a structure and a scenario that makes me a little bit more anti-fragile and lets me sleep better at night i might regret that down the track when when property 10x is over the next five years um but unless you're confident in that in happening i i tend to lean that way so i actually take a different view to you actually um and and largely ironically back to the regret minimization framework uh or risk minimization but from different perspective and that's i guess why these are useful conversations because i was with you up until about the five six of the way through your response um which is so and there's a couple a couple things to break apart out of the question which i will get to in sec george um i for all of your comments at the ladder all that kind of stuff i think that's true and i think if you have a million dollar place just for the pick a number and you used your example before and it goes to 900 000 you probably better know you've lost some money but if it goes to two million dollars you can't get back into the market i think my in terms of risk mitigation risk regret minimization whatever whatever whatever having an asset particularly ironically if it is leveraged because if you sell a million dollar hashtag a hundred thousand dollars out and then prices double you know even if you invest that money even if you get better than than that return your hundred grand becomes 250 but the property gone from a million to two million the quantum of of of change is so huge and i think the speaking of asymmetry if i buy a million dollar property goes down a bit yeah it's kind of sucks if i buy if i buy one it goes up a lot if i don't buy one goes up a lot, then I'm kind of locked out.

26:30I think the asymmetry on that for me is if you're in a position where you've got, you have a property, I won't say you're on the property ladder because I don't want to earn your ire. Don't you dare. Exactly. But the idea of, I think if I play that forward, having got that property and being in that position of having, you are, I don't know, you're in the same stream or there's an analogy there somewhere, which is not ladder and it's not in the market, but you've got your position in the race maybe is i don't know there's better ways um but you get the broad idea i think if it was to rise the dollar value of the increase is it's hard to be particularly if you are still leveraged ironically if you own the house outright i would almost go back to your point mate because at that point you say well a million bucks is a million bucks i have it in housing i can have it in in shares i personally shares probably better than housing in all probability if they don't they're not going to do that much worse that you're going to be you know locked out permanently maybe you have to borrow a little bit to get back in if you come to it but it's going to be small if i had a leveraged exposure to uh property then i think honestly i would actually keep it um a couple things just george for what it's worth um just to have a think about the first is uh you're in the country uh from the sound of it you're you're not saying you're in the country sorry you're in coral you are um so i i would just be mindful of that particular i will say market in this case because it is you know the the price and the uh the activity of rent appropriate use of the term you are you are allowed to use that i'll allow it um just have a think about about property prices and rentals just understand that particularly uh rand makes the point regularly that an economy isn't a single thing it's an aggregation the property market or property generally isn't either it's an aggregation of things and different suburbs towns cities regions have different um different components just have a think about that there is for you some consideration about the tax treatment of your house.

28:19So I will just say that in terms of, you know, how the tax department, you need to get financial advice. Is the motel going to be considered your principal place of residence if you're living there? If not, is it the house you are currently renting out? In which case, you're getting that rent, which is taxable. But in terms of capital gains tax, it may not apply. You can have a six-year exemption. You can live out of your principal place of residence for six years without incurring capital gains tax. So that's also material. You're treating it as an investment property because you're getting income from it.

28:49Maybe you're paying repayments or maybe not. But if you are, again, from a tax perspective, just understand that because it does matter in terms of the implications of what happens if you sell, any gains you may or may not be up for, or the fact you may be able to hold it for five or six years without capital gains tax implications, giving you all the upside if there is any. Prices could fall, as Ram often says. But if there is upside, you may get it tax-free, which is worth just having a really, really good think about. So just the way you're planning to utilize that. Also, how long you expect to be managing the motel and whether the motel may be your principal place of residence for tax purposes.

29:22So tax advice, definitely, definitely worthwhile. So yeah, different answer to Ram. If it was me, if I was in that position or it was my relative or something, I'd say, you know what, I'd probably keep the property you own. That way, your asset will rise at least proportionally or fall, but in proportionally to the rest of the the rest of the properties, the rest of the market. Again, I think I can use it in that context, Ram. If and when you're looking to buy another place or sell, you know, you will be the rising tide in this case or the falling tide, you're on the same tide as everybody else rather than getting out at a certain level and hoping the water is the same level when you get back in.

29:56I think that the quantum of change, the C-dollar value of the change, particularly if you're leveraged, I would, if it was me, I would keep it because I would want to know that if my prices went up, my asset's going to increase by a proportional amount. Again, the asset rather than the equity, which actually is more important in this case. You do have leverage risk, you do have repayment costs, so those things are real. But the dollar value of the difference, almost rammed to your example. I'm sorry to bring it back to that or to return to that. But that's almost precisely why I think the downside risk and the upside risk are asymmetric.

30:28I would hold onto the property and make sure I was proportionally exposed. Any other thoughts or should we move on? I just I had to laugh it was like when you say well as Ram says prices can go down I really feel it is it is only me I was just giving you credit for having said it before that's all I'm not I'm not suggesting you're the only person who says it I just didn't want to pretend I was taking that line for myself I was trying to refer some glory back to you it's just it's well what's what's interesting uh and I can attest to it because I live it's my life that I'm living and is that that is that statement not that prices will fall but that they could is controversial yeah like it is in my like every time we say because it's australia you can't like have a conversation without someone mentioning property and you go oh yeah but what about you know could go down and just like it's like you've just said oh but what if aliens land and you know that's right you know it's like i'm not i feel as though it's just a very like it's a statement of obvious fact that You know, sometimes, not all the time, and maybe not on average over the long term, but sometimes prices do go down.

31:32And you just, like, you get looked at as if you've got two heads. It's like, I didn't think it was that controversial a statement, but it is. But it is. And that, I don't know, that's a data point I would consider. I like it. That's fair. The moment that, like, when such a blindingly obvious statement becomes controversial, it probably tells you something about where you are in the cycle. I think that's probably right too Motley Fool Money For more, subscribe to the free newsletter at fool.com.au forward slash listener

32:07Let's move on to a question from Brent who starts by saying Good morning Scott and Andrew Well it's not morning It's morning now, it's Sunday morning of course Good morning Scott and Andrew I can't bloody wait, says Brent to warm up the podcast machine on a Friday and a Sunday to listen to your new episodes Thank you again for this amazing resource. There you go. Is that it? I know, he says, Sorry, I was laughing. Via a takeover, I've recently become the owner of shares in a company called Parenti, which provide mining services. Not knowing much about the company, I pulled up and attempted to read the annual report.

32:45All 172 pages of the thing. Good on you. Is there some competition, he says, where the longest annual report each year wins a prize or something. He says, that's not a podcast question, but seriously. I thought I'd throw it as a podcast question anyway, although I'm not expecting you to answer it. We'll call it a rhetorical podcast question, Brent. After scrolling past the nice pretty numbers, he says, showing how well the business did last year, I went to the profit and loss and the cash flow statements. Not surprisingly, they were gibberish to me. Is there a resource like reading annual statements for dummies you would recommend to someone like me who is keen to learn more.

33:21Also, I hear this term a lot. What constitutes a strong balance sheet? And what are some common orange or red flags we can look for? Lastly, I heard the term cash or cash equivalents. What is a cash equivalent? Ask Brent. Warmest regards from Brent. Really, really good questions there, mate. Is there a resource round? Let's start with there. How would you suggest someone learns to read the financial statements? I'll go back one step and just congratulate you for doing what virtually no one does, which is read the annual report. Going to the source. Yeah. Like, good on you. Yeah, they're ridiculously long.