Mailbag, incl: Is it time to get defensive? February 1, 2026

25:29So just prepare broadly. And I guess prepare for me is actually pull your horns in a little bit. So don't take silly risks, not that you are, Peter, but if I'm preparing for something, I'm preparing for a range of outcomes. I'm preparing for the fact the market might be great. So I want to be in growth companies. I'm preparing for the fact that investors might love shares because they want to get out of cash okay well so i want to own some shares um i'm preparing for the fact that inflation might continue so i'm not owning i'm not having physical cash or you know cash in the bank um there's much more than i need for my you know rainy day fund and all that kind of stuff i'm preparing for the fact that yeah maybe things do go out and we talked on friday about that if you got to the end of our hundred plus minute podcast on friday and if you did thanks for listening because you're the only one um that you know that idea of i don't want too much debt so i'm i'm i'm removing certain risks here's the other thing mate and rem we didn't say this on friday i don't want to go necessarily all the way back and re-prosecute the whole case what are we going to do we're going to do things that have always made sense to do and that's the other thing so you know in the good times having too much that's not a problem but it's not a good idea to have a company with too much debt so you kind of go well well actually isn't all that just good investing yeah turns out it kind of is and so is the circumstance relevant relevant relevant?

26:42Turns out not really. So, Peter, I don't blame you or mind you doing whatever you're going to do. And by the way, if you just want volatility protection, I get that too. Here's the other thing, though. Woolies fell during COVID. So what is conservative? What is genuinely defensive? And if you mean the businesses, that's different. If you're about share prices, I mean, man, Woolies has been as high as, what,$38 as low as$20 in the last seven or eight years around. I mean, it does get more defensive as a business than supermarket retailing. and yet the share price has still been all over the joint.

27:12Healthcare was supposed to be, in theory, defensive. Healthscope went broke. So just, again, I get it. Probably the best way to be, not even conservative or defensive, the best way to have a relatively, not even anti-fragile, just robust portfolio is do all the usual things. Buy quality businesses, buy businesses that are growing, pay good prices, be diversified. But it's just good investing approaches will look after you no matter what the circumstance. So for me, prepare is invest properly. Invest the way I know I should. Don't get pulled off by promises of riches over here or fears of collapse over there.

27:53Just invest sensibly, invest properly, keep doing it. Willis is such a great example. So I think I've said enough times that I don't need to repeat it, but I will because nuance is important. I regard it as one of the best businesses in Australia. Oh, absolutely. I'm not going near. It's too expensive. Here's the other thing. I think history's vindicated us, mate, to some extent. I mean, five years ago, you could have made some pretty bearish cases, right? With a lot of good rationale and facts and figures behind you. And you could have piled in at the start of 2021 at$35. At one point, you were down 27%.

28:28This isn't a meme stock. It's not a speculative gold explorer. It's one of the most defensive businesses, bluest of the blue chip, and you did a quarter of your dough, not over, it looks like a short-term fluctuation, but over a multi-year, over a five-year period, you know, it was only like late, when was it, August, October last year, they were at, I should look it up, 26 bucks, right? Now it's come back a little bit from them, but again, you could have bought it in 2021 at over$40, right? And for, because, oh, it's scary and it just, it's not to go, ha, ha, ha, look at this, everyone's an idiot.

29:03No, it's just to say, this is what markets do. They rub your nose in things where you even generally write about the outlook. Because the world has not improved. I think it's a pretty, you know, it's not a grand statement to make that the world has probably not improved greatly in five years. It's been a pretty interesting ride, right? And yet, right? I like Howard Marks' approach with all of this. It's not about trying to forecast the future, but trying to get a sense of where we are now. I've heard it's called now casting, which is a stupid word, but instead of forecasting. But what he does is he sort of says, listen, I don't know where the world is going, but I know relative to historical standards, multiples are up there.

29:46I know relative to historical, you know, the historical track record that debt levels are up there and et cetera, et cetera, et cetera. Now, that doesn't guarantee what comes next, but I do know that all else being equal, this is probably not the time to lever up on unprofitable growth stocks. Like, it's just probably not. I mean, that doesn't mean anything's going to happen badly, you know. And likewise, when, you know, when things are looking really dark and we've had a three-year ongoing recession and unemployment's at 20%, that's probably not the point to go all into something uber defensive.

30:20Like, you know, the horse has bolted at this stage. So it's more about just sort of saying, listen, I don't know what is next, but I know that generally speaking, we are closer to this end of the spectrum than that end. And given that, I am probably not go all wholesale, liquidate, portfolio, pivot into this. I'm just going to have a, when everything is going great, I err more defensive. When things are going really scary, I err the other way. It's the whole Buffett, be greedy when others are fearful, fearful when others are greedy, you know, which is a lovely little statement that people misread into.

30:53but it's more about that than these wholesale shifts based on particular views at particular points in time. Lovely. Well, very well put. I have a T-shirt saying, be fearful that's greedy on it. And no, be greedy that was the fearful on it, the Buffett quote. And when I was younger, he was like, that's not very nice, Dad. I was like, that's probably not. I'll explain the context to you later. You've got to show him the Gordon Gekko greed is good speech. Yeah, that's why. I wonder if he, would he enjoy Wall Street yet? Might need to be a bit older for that one, but yes. Greed, gentleman, for whatever word is good.

31:23I need to re-watch it. You know what? Listeners, I'm sure I know this, but that book was written as a warning of Wall Street successes and spawned generations of would-be stock traders. Yep. Same thing happened with Stratton, now Oakmont, which is the - Yes, that's right. Wolf of Wall Street. Wolf of Wall Street. He got this really bad, what's it called? Hit piece in the media about how bad he was. And the next day, everyone was wanting a job there. That's so good. Oh, humans are weird. We're really strange. We are. All right. Hello, foolish friends, says our correspondent, who says, please refer to me as DJ.

31:59And all I can go to is... Spin that wheel, DJ. I'm going to DJ Jazzy Jeff and the Fresh Prince. That's just my age. Thanks for continuing to feed thoughts, facts, and opinions into the pod machine. Not always in that order, by the way. I appreciate all the thought-provoking and entertaining discussions, says DJ. While my worldview seems to generally align with yours, you've both given me new perspectives to consider on a variety of topics over time. Job done. Job's done. That's all we can hope for, right? Exactly. To that end, I have a question, albeit a bit grim, on the topic du jour. Now, you know this is going to be the B word, Andrew, so I'm going to ask you to stay with the mechanics rather than the broader topic, if you can.

32:38Over time, you've brought me around on the idea of Bitcoin. Andrew is not exactly, but in his head, he's punching the air right now. The high-level understanding of sound money and its value over time has what's tipped me over the line. But if I'm being honest with myself, there's probably a dash of FIMO in there as well. Man, that's true for all of us. To get started, I originally dived in by buying an ETF. I bought the Betashares flavoured one. Then he uses a stock code. Don't do that. Don't do that, DJ. QBTC it is, which is obviously the Betashares Bitcoin ETF. As a straightforward option to get me started.

33:11Beyond any complexities and concerns about managing keys and wallets, it, I think, provides a simpler answer to what would happen to my investment in the event I am hit by the proverbial bus tomorrow. I've thus far assumed, perhaps naively, that should the worst happen, my share ownership would eventually wind its way to my wife. This would not be the case with buying Bitcoin directly and storing it in a wallet. So should I go down the direct path in future, I'll need to have a plan to educate and share the right information, whatever that might be, with my better half. Easy peasy. But what if we both happen to fall under that same bus?

33:47the plot gets more complicated to say the least I'd appreciate if you can share some general thoughts and approaches on how one might consider this I'm sure I can find ideas and answers online but I thought it was an interesting topic for you to explore and ensure your growing army of motley bitcoin warriors are considering this as part of taking their this is red pills I'm pretty sure it's an orange pill Ram isn't it? it's an orange pill hell yeah part of they're taking their orange pills thanks again for your entertaining and informative work DJ thanks DJ appreciate it mate and hopefully if like me you're down on your Bitcoin you can also blame Andrew Page for getting you on the Bitcoin train.

34:20That's how it works don't you know you get the blame when it goes down but none of the credit when it goes up. You and I have been recommending stock for way long enough to know that's exactly how it's always worked and will always work. Yeah I made my peace with it. So bought an ETF thinking about doing it directly you've kind of shared some general thoughts in the past about kind of some options here. Not your keys not your coin obviously we all know that by now But equally, an ETF that is with a reputable provider with reasonable trust structures put in place, available to buy and sell on an exchange, as good, not for the purists, almost as good and functionally effectively as good, maybe.

34:59So just a top line thought, mate, on the choice there. And then maybe I have a suspicion you'll recommend a particular service to think about when it comes to how to make sure if something does happen, your Bitcoin is able to be accessed or inherited or something else. Yeah. I mean, so first of all, there is no perfect solution. There's only a solution that's best for you. And what works for me might not work for you. So I don't want to be too ideological with this kind of stuff. I think anything that gets you off zero is a good move. It furthers the cause. What about the mission? I mean, ETFs are super convenient.

35:40They're super easy. The risk, and this is like, this is very much an edge case, but I just put it out there, right? Because it would be negligent not to do it. But if in a world where we get further and further into a massive debt spiral and there are various capital controls and asset seizures, you know, it's a big honeypot. It's a pretty big honeypot to dip into. And again, we talked a lot on Friday about the lessons of history. And the unimaginable tends to happen a lot, right? We forget that the US Order 6102, was it? They seized gold. Yeah, they did. They're illegal to own gold. Yeah. Like, say what?

36:19Like the first time you hear that, it's kind of like, come again? Yeah. Oh, you mean North Korea? No, I mean the United States. Oh, you mean like 300 years ago? No, no, I mean just less than 100 years ago. So it's sort of, I don't think that that's anything that you would worry about. I've got some in an ETF for my super at the moment. I don't lose much sleep over it, but I put it out there, right? And of course, the trouble as has been articulated with withholding the keys yourself, if you lose those keys or your heirs don't know about those keys, it's effectively lost forever. So there's a trade-off there as well.

36:51There are various custody solutions that you can get into. I'm not going to do it any justice. I don't want to waste too much time. And I've gotten the message loud and clear that most people just get annoyed when I start talking about this. But Google it, right? Like look at multi-sig custody solutions. What's the one you recommended to me when we talked about, I don't know if we don't hear it or not, but it was that one that has the kind of custody, is the device you buy with the Square type thing? Oh, you're thinking about blocks. Yes. Yes. The BitKey. BitKey. That's what I thought we were going to mention.

37:24I haven't done anything with that. I'm not going to give you advice. DJ, I've known you far enough through it. But BitKey looks really cool. There's some cool videos on the website. It's marketing, right? So don't look at it and go, wow, that must be amazing. I'm sure there are drawbacks including the price. But it does deal with some of those potential issues should you choose to. It's a little less secure. or they have all the stuff yourself, but equally it's less catastrophic if for some reason you can't or don't find those keys or someone else can't find them. I bought one for an older friend.

37:57A friend who I've known for a while but is of an older age as well. It's just like that. It's just inheritance as well, doesn't it? I remember. Yeah. So someone, a friend or family member can download the app and you can be there. You can be where it goes in the event that it's lost. Look, you can read up. I'll do that for you if you want to send me a bit kind if something happens. I've got it sorted, don't you mind. And, you know, yeah, so, yeah, I'll just leave it at that. There's a lot of good options out there. I mean, the thing to remember is there are always trade-offs, right? There are some people who will tell you that they'll bury things in steel plates in different geographies.

38:37You know, it's like hyper, hyper safe, but it's just like there's also there's a big risk that you have a brain injury or you get topped very quickly and you know no one knows where it is and it's just all gone forever um so i i think i think the bit keys are really nice i don't get any referral codes i wish i had a referral code this is jack dorsey and block right these are the people who bought afterpay he's a huge company they've they've engineered this thing very well and then you get other things like cold cards and you know fountain passports there's a bazillion brands that are out there but i think that's a nice easy jumping off point or you know just do a little bit of little bit of both i always encourage people who are all in the ETFs.

39:15It's like, dip your toe in. Buy a wallet. Put a thousand bucks there. Okay. It's going to suck if you lose it, but it's not the end of the world. Dip your toe into it a little bit. See how you go. It's like a lot of things. Once you do it a few times, it's like, oh, this is really not that hard. It's like buying shares. It's like internet banking. The first time you're just like, oh my god, what is this? And then you can't do it. It's terrifying. Oh, no, I get it now. You're right. Don't be put on it. I say with shares, people are put off investing for the same reason. I don't know how to use a brokerage account.

39:41What I was like, do you use internet banking? Yeah. Do you remember the first time you used that? Oh, yeah. Like that. Same thing. Deepy Tone. I will say owning Bitcoin directly is complex-ish to get your head around the whole lot. So I don't want to oversell the simplicity. But it's kind of fun. You said to me, I don't know if we've shared this publicly and we won't talk for too much longer about Bitcoin, but you mentioned sending me, you think I'm the first person you knew who was mining Bitcoin before owning any. Yeah, that was like, what? That's usually reverse order. Right. And I didn't have it in mind any, unfortunately.

40:13I must check actually I'll do it while you're talking in a minute just in case but for me it was about understanding the ecosystem and so it was kind of part mental challenge part kind of fun but also part actually what is this thing how does it work how does it all go together and so for me part of my journey was actually just I mean I bought some ages ago just with an online wallet just to get into it and then I sold it after that and we all know that but yeah it was kind of like hey I'll just I'll grab a I'm not going to go into details grab a little cheap little Bitcoin miner I'll set up a node I'll do the things just so I kind of get how it works and what happens and all that kind of stuff.

40:45And then I bought some using an online wallet. But it's just there's many ways of getting to it. Is there, in your mind, mate, obviously you've got an ETF in your super, a Bitcoin ETF in your super. In any reasonable, and again, anything can happen, right? So I'm loathe to ask the question. You may even not want to answer it. That's completely reasonable. Would you try and discourage anyone from owning Bitcoin and ETF? I mean, in the range of probable possible outcomes. No. I mean, DJ's doing it. Is there a reason to not go with that in your mind? Look, if I was in a jurisdiction where things are getting real.

41:24Yeah. And again, I know, I know, I know, I know, I know. I'm hyper. Please believe me. I am hyper aware of how this sounds. Again, it's just objective observational reality of most jurisdictions around the world. You know, ask the Egyptians, ask the Lebanese, ask the Argentinians, right? Even ask the Yanks, you know, not that long ago. And generally, I mean, ask the Chinese today, massive capital control. You can't take your money out of the country. And when things, when governments go bankrupt, they start taking other stuff, right? And it's just, that doesn't mean it's guaranteed to happen. But if things started to, these things tend to be reasonably visible.

42:02Like it doesn't just happen, you wake up one day and everything's a perfectly stable democracy. and then, whoa, it tends to be slow. But if things were sliding in autocratic directions, and this is not my base case, by the way. I always put that out there. This is not my base. I'm just saying, to answer your question, no, ETF's perfectly fine. But if, and maybe it's the smallest if ever, but if you started to feel as though certain noises were being made, you might want to think about changing your custody arrangement. I think it was a Portugal or something recently started floating the idea of specifically taxing unrealized gains in Bitcoin.

42:36Right, okay. Which just feels like, what? Why? You know, which is usually the classic. Same as always. I want to say it wasn't Portugal, but some Western democracy in Europe. Like again, it happens, right? So look, unless you see that kind of stuff on the horizon, the ETF is fine. Other than just to sort of say, the tooling gets better and better and better, which is always the way with protocols, right? Like you just, the, the, the, you should have seen how hard it was when I got into it. Man, it's tough. And when I got into it, I had people telling me, oh, you should have seen how hard it was in 2012, right?

43:09Yeah. And the analogy I always give is like setting up your email server at home in the early days of the internet. It was a, it was a bloody nightmare, right? You can't imagine how hard it was to set up an email server at home. Download a Microsoft Outlook, you download the instructions for an IMAP or a POP3 setup and you have to type the details in the right fields and all of a sudden it works. Oh, that's amazing. And even then you're relying on their kind. It just became super easy. The same with the internet. I mean, the internet of the late 90s was very clunky, setting up your home modem.

43:41Nothing has changed in terms of the base protocols, but people build. That's what protocols are good at because you can build on top of them, right? And people are building on top of them to the point where it's just getting easier. And the ETF is, in fact, an example of being built on top of. It's what it has done is it is, it has provided a bridge to traditional finance that integrates within the existing framework. So it just, it just made something that was very hard. Now, you know, they always open up your CompSec app and press a button. Boom. That's how you do it. You can whinge and whine about how it's not the purest kind of thing.

44:15And the fact is like I can do it and it's actually brought a lot of capital into the space. So, you know, but also play around with it. It's fun. It's kind of fun. It's very interesting. It's very novel. There can be a digital bear. I ask, like, how the hell does that even work? Play around and just do it with 50 bucks, 10 bucks, one buck, two sats. I don't know. Something where you can cover some of the transaction fees, of course. But you'll learn a lot and you'll understand. You told me not to talk about it. But I think one thing I will say, in terms of orange pilling, I think one of the most effective things I've done is just people talking about it.

44:47It's like, I'll go to the app store, download this app. I'm going to send you some Bitcoin. Two seconds later, they have it. You and I just did that without anyone knowing or authorizing it. and I it's that you can talk about theory until the cows come home but doing it is just sort of like oh I get it now it totally is and that's what that's literally why I set up a node and I bought the miner and I just did the thing just cheap miner I'm never going to mine any bitcoiners they call it they call it lottery miners it's not going to happen right but it was just the idea of like setting it up working out there's a public pool and I'm not going to go out of the detail either but it's just yeah have a go Motley Fool Money for more subscribe to the free newsletter at fool.com.au forward slash listener

45:27Hey, one from Nessie, who says, Hi, Scott and Andrew. I love you guys. Especially Andrew. Because I'm a straw man premium member. I've got to know Nessie. Nessie is a straw man username too. I know, Nessie. How you going, Nessie? Thanks, mate. There you go. Not a Motley Fool member. Okay, Paul. Well, I'll move on. No, I'm kidding. Thanks for all your summertime recordings to listen to over the break. No further compliments required. Just love. Incorrect, Nessie. Nice. What? No, excuse me? Yeah, you're right, you're right. More confidence is not required. No, thank you, mate. Really appreciate it.

45:59My question is about this called mean reversion. I think I understand the concept, but I'd like Andrew's opinion with respect to our straw man small cap land. Can growing companies mean revert to anything? Also, with respect to the broader market, with this new AI world, high market PEs and high growth, forgetting what that might happen to real hard money, Does mean reversion even apply today? How much is it worth considering these modern days? Would appreciate your thoughts, Nessie. Now, mate, before we do, I'm going to get you to explain mean reversion and then go into whether it applies to small caps and whether it applies in an AI world.

46:37Yeah, I mean, you've got to be careful on the dynamic you're trying to explain because there are some things that are very much mean reverting and other things that don't. We talked a little bit actually during the summer break about things that obey more of a power law and don't adhere to more of a normal bell curve kind of distribution. So you've got, I mean, this is one of the fundamental mistakes people make with charts and with data and with investing. So we just, the human brain loves to see patterns that aren't there and extrapolate, not realizing what's there. So a great example would be something like height.

47:08Like I can, someone randomly walks into a room, I have no idea how high or how tall they're going to be, but I get a million people to walk into a room, I can pretty much tell you exactly where the average is going to be, right? Because any perturbation from that mean will revert over time as the data set increases. So where is this applicable in investing? It tends to be, as a historical observation, it tends to be very observable in things like price earnings multiples. They don't go to them. Earnings go up forever in theory. I can pick at that and really get to some philosophical naughty kind of points, but generally the nominal fiat value of these earnings go up in aggregate go up forever.

47:54So that's not a mean reverting quality. The average earnings per share of the top 200 companies on a reasonably functioning market is probably going to go up forever. But the PEs aren't going to go up forever. In other words, the multiple. So what it means as an investor is on a statistical basis, if you're buying a lower PE stock, you might find that part of the return comes not because the business did anything that much better, but that the PE normalized, it mean reverted. It reverted to the mean, and mean is just a fancy way of saying average. And vice versa, very high PE stocks tend to revert to the mean.

48:33And often it's a sentiment driven too, right? So it's the case that when the market's really, really hot the average pay of a market might be 16 ish really hot market it goes to 18 or 20 or 22 in a really depressed market it might drop to 13 or 14 generally speaking because the value of money is generally considered to be discounted to the present value 16 roughly is about what you want to pay for the average growth company average growing company so not growth company growing company over time so because it because it makes mathematical sense doesn't mean that from time to time things don't get out of whack in either direction but it tends to go back towards the average because the average kind of makes sense and whatever the average makes sense it should go back it will go back there almost certainly over time oh well above the average at the moment we are like uh that's the ai question that this is also getting to so let's let's talk about small caps let's talk to a little bit i think where it's really relevant for small caps is that who was the there's a really famous investor who said pe's are dangerous you you've got to earn the right to use a pe it's so dangerous right because it's very easy take the price divide it by the earnings Historically, this tends to be high, this tends to be low.

49:35And it's like, yeah. And they're really good rules of thumb, but you've got to have a lot of understanding as to what's going on to sort of make sense of it. And where you get wrong-footed with all kinds of stocks, but particularly with small cap stocks, is you have these companies where I, it's my sweet spot really, is companies that are transitioning. They've got a product, revenue's growing, and they're passing an inflection point of profitability. So they've been bleeding cash. They've built up a cost base. They've done a lot of R &D. they've built the factory, whatever it happens to be. They're selling a lot of stuff.

50:04They're selling more stuff, but they're not covering all of their costs. Catapult's a good example of this. They're still making a statutory loss to this day. I don't think they've ever made a statutory – well, they definitely haven't ever made a statutory kind of profit. When they do make a statutory profit, it'll probably be on some ungodly PE because the denominator will be so small. and that's going to potentially put you at a disadvantage if you take too myopic a view at it because what you also notice is particularly companies that can very effectively scale, that have a lot of operating leverage.

50:41Let me back that up, which is just a fancy way of saying I can continue to – the operations and the fixed costs that I have can sustain a much higher level of sales and I've kind of got to build up that capacity But once I've built it up, you know, if I double my sales, my costs might only increase by 5%, which means that your revenue grows by 100%, but your earnings, your profit might grow by 800%. Yeah, yeah. And that, as companies pass through that early stage inflection point, assuming they do continue, these are big assumptions, right? This is what you've got to look for. Assuming they do continue to scale effectively and they do continue to unlock that operating leverage.

51:17If you just look at the P and go, oh, the P is 280. That's ridiculous. Like, yeah, but it's of a tiny slither of earnings. Next year, those sales are probably likely to continue to grow at 30%. And as the costs stay steady, those earnings might go from a million to eight million, like a 900 % increase. It feels silly to put that rate of growth in until you understand the accounting mechanics that are sort of behind all of that stuff. Nevertheless, one way or the other, that PE will normalize. In this instance, it'll normalize, even if the price doesn't move, just because the denominator it gets larger and larger because the earnings grow, you'll find that the PE comes down.

51:53So you never want to be in a situation where your return is entirely beholden on the market, continuing to be more and more optimistic that it pays more and more of a multiple. Because at some point, at least it seems to be the, I don't think there's any exception over any long period of time where it will normalize at some stage because either the earnings will grow significantly to normalize it or the market will realize that the growth potential won't be realized and the price will correct. So I think when you're looking, what I do is I try and look out five years or so and sort of say, well, what are the earnings like then?

52:28What's a more average, more mean oriented, more quote unquote normal PE for that kind of company and use that as the PE rather than the current PE. It's like, do I think that they can get their relative to where the price is today and what I think earnings will do? but nowhere in that have I assumed that I'm going to buy this because I think the market will be in an even better mood and the PE will be even higher because that's a very, very difficult game to play. Why? Because PEs mean revert over time. I've probably butchered that, mate. Would you? No, you've done a wonderful job. You've done a wonderful job.

53:05What do I have to add? Yeah, I love your point about the right to use a PE because, and you've done a beautiful job with the example of unprofitable companies. and it's where every... No, trees don't go to the sky. So growth companies have growth PEs, totally fine for a period of time. Well, as long as it's not too high, but they will come down as growth comes down. And then it should. And that's exactly what the market does. The markets... Andrew and I try and find inefficiencies in the market when we buy stocks. So what you're trying to do is try and find something the market's wrong about. It's hard.

53:34Because the market's not wrong as often as we'd like to believe or like to hope or think. If it was fish in a barrel, Rem and I would be on the Bahamas somewhere, right? that being said the straw man yacht is in dry dock at the moment when it's back out he'll be he'll be he'll be sailing to the bahamas it's a it's i don't say i don't say too much but andrew bought james packers old a super yacht over the weekend of the holidays um so the straw man it's called um so yeah no and that's it happens right it's worth bearing in mind i will i'll take a stab at kind of the next bit of nissy's question yeah please So in small caps, a growing small cap will probably have a higher PE than the overage market.

54:16Why? Because it's growing. Because future profits are higher and growing faster than the rest of the market. So it should have a higher PE. Because the PE is based on today's earnings or next year's earnings, not at least in 10 years' time. Amazon's a great example. I own shares. The PE was 1 ,000 at some point. It's still not market average, but it's come down to buggery. The price has also gone up. The profits have gone up faster than the price has gone up. and so the PE has just come absolutely crashing down. It's what should happen. So you should be prepared to, you should expect to pay more for a growing small cap than you would pay for the average market.

54:47And that's not a bad thing. That's just, as long as you're right about your assessment of the growth, you should recognise the fact it's a faster growing company. The small caps PE will almost certainly mean revert as it gets bigger because the growth is harder to come by. You know, it's easier for a retailer to go from one store to two. Well, sorry, not easier. When they go from one store to two, they double their store cap and double their sales. When you go from 100 stores to 101, you're adding 1%. It's just harder to grow. Woolies on a PE of 50 is the height of madness. It's almost impossible to do well over any sustained period of time.

55:21But that's why straw man is worth a billion dollars because a PE of 10 ,000. No, I'm kidding. So small caps should mean revert, Nessie, in my view, for exactly that reason. AI is fascinating. I don't even know about AI particularly. I've not done the work and I should. You mentioned that we're above average PE in the Australian market round. That's hard to justify. In the US, I think it's easier to justify, easier, or at least easier to plausibly explain why it might be okay. And not just that PE's won't mean revert, if the average growth of the S &P 500 is faster than historical growth, then the PE should be higher.

55:58Again, because that's the way, and apologies if you don't superfitting with PE's and discounted cash flows. Trust us in the direction, unless I'm getting it wrong, in which case Ram will tell me. You should pay a higher PE for a faster-growing business and a lower PE for a slower-growing business. Can I just flesh that out for you? I've got a business and I don't make any money, but next year you and I are convinced because we've just invented a hoverboard or something that I'm going to make$10 million. Now, if you buy it today, you're buying it effectively on an infinite PE. But you're not buying it for what it is today.

56:30You're buying it for what it can do tomorrow. and there might be a company that's on a PE of two, which ostensibly is like ridiculously cheap. But if that company's bankrupt next year, which one is more expensive? So it's not, you don't even have to understand the math, just understand the intuition. You're buying something that for hopefully very, very long time is going to throw off cashflow or has the potential to throw off cashflow in the future and then for a long period of time. That's what you're buying, right? And to compare that against what might have happened over the most recent 12 month period misses the point entirely.

57:04Misses the point. I mean, actually for something that's super steady, super reliable, each year they make about this, this is where you deserve the right to use it. It's like, wow, actually as a good heuristic, as a good rule of thumb, understanding what I understand about it is I can really get a good handle on value from all of that. But only if I understand the prospects, right? And I just think intuitively it makes sense to pay for something based on what you will get, not on what it is now. Yeah, I love that. I think, and I'm actually, can I adjust your example? Because I just want, I think you mentioned infinite PE and that's a little bit harder, I think, for some people to get.

57:36Can I just adjust yours a little bit and say, we're making a million dollars this year and we're paying a hundred million dollars for the business. Man, that's a PE of a hundred. That's a lot. Next year, you make$10 million. And all of a sudden, the hundred million dollars you paid for the business now only 10 times earnings. And so that's when PE's will mean revert, right? Because you're looking forward and going, we will have, when earnings grow, the PE will come down. Even though the price is unchanged, that's kind of what happens. So that's relevant. Yeah, what was the P of Amazon when it tipped into profitability?

58:05Squillions, I'm sure. Squillions. You make a dollar of profit and you're still worth a couple of billion dollars in market cap. What a great purchase, though. Right, exactly. So let's go back to the Magnificent Seven, speaking of Amazon. If it's true, and I don't know if it is, but if it's true that the Magnificent Seven, the so-called, the seven largest businesses in the US that happen to be all tech businesses, If they are going to grow faster over the next 10 years, then the market tends to grow normally, then the market will have a higher PE, and it should. Because back to Ram's example, if your business goes from$1.1 to$1.2 to$1.3 million, you're going to pay 10 times that.

58:43You're not getting any growth out of that. You'll pay a bit more than that, but whatever it is. If you think it's going to go from$1 to$10 to$100, you're going to pay up a lot, right? And so the PE of the market of that one company is higher than average. Man, the one company market, the P is 100. It's normally 10. That's crazy. What's going on there? He said, yeah, okay, but it's going to grow. Now, if it doesn't and it goes backwards, you've paid an absolute squillion dollars more than you should have. So I don't make the case directly for the magnificent several for the US market, but I do think it's very probable in my mind, my opinion, that those big companies grow faster than their forebears, in part because when the market was dominated by General Electric and ExxonMobil and IBM, whether it was just literally making equipment, not actually doing services and stuff.

59:30How do they grow? They've got to build factories. They've got to employ more people. They've got to get a whole lot more capital. They've got to convince more people to buy their products. That's a really long, expensive supply chain, super capital intensive. You're borrowing money, you're raising capital, and it's successful. They did a really good job of it for a long time, not forever, but for a long time. And so that rolled out beautifully. These days, can an AI-powered, I'll say Google, I don't know Alphabet shares, can that grow faster than GM used to, General Motors? Yeah, because cars were saturated and AI is brand new.

1:00:02Can Netflix grow faster than ExxonMobil? Yeah, because Exxon's got to build a whole new oil derrick and float out in the middle of the ocean, try and find some oil and then spend five years drilling the well and then getting some out of the ground and then finally paying for itself. Can Netflix bring in a couple of new specials and get some new customers? Yeah. Will it? I don't know. But could it? Yeah. NVIDIA, going through the roof. They're out of stock of chips most of the time. Can they keep going? Yeah. So again, I'm not making a case for buying. Please don't buy them based on this at all.

1:00:34I don't own NVIDIA. I do own Amazon. I do own Alphabet. My point is, it's very, very, very possible, incredibly possible for them to grow faster, that the ceiling on their growth rate is much higher than for an industrial company. It just is on an annual basis. So will it mean revert? Yeah, eventually by definition. how long will it take the question is how long can they grow faster than the average company in the past and that is your answer Nessie and I wish I knew the answer I don't I own Alphabet and Amazon shares that probably tells you something I don't own video I don't own Netflix I don't own Tesla I don't own Facebook so you know who knows but it's just a sense of what is possible and why mean reversion almost certainly will happen but it may take years and not happen because of the value to happen because earnings growth eventually finally slows down or slowly slows down over a decade and a half.

1:01:22So it could take a long time. I wouldn't bet on mean reversion as an investor because you've got to try and work out timing. And eventually things happen. What's the old quote, mate? The market can remain irrational longer than you can remain solvent. So I wouldn't bet on mean reversion. I wouldn't bet that it won't happen. That's the other thing, though, I would say. And you made the point, Ram, of if your investment thesis is the market will always pay a stupid price for these shares, that's a pretty flimsy one. I mean, we spoke about it recently. I mean, some of the best technology companies on the ASX, and these are great companies, like, you know, Technology One and WiseTech and ProMaticus and, you know, they're all down between 30 and 50%.

1:02:00Yeah, yeah. You know, why? Because they say they traded at levels that it's not enough to say, oh, but they're going to grow a lot. Yeah, I know. Thanks, bro. But it's more than accounted for, right? Like it's just, it's, that's the reality of it. And you are fighting against that mean reversion and it's just super, super dangerous. I'll add one more wrinkle to it that really makes it, makes a hard thing even more challenging is that the growth, even high growth is never linear. It tends to be more, I think S curves are really underrated in investing, particularly technology investing. You've got to think a lot about S curves, right?

1:02:35Which is nothing, nothing, nothing. Oh my God, your hair's blown back. This is the most incredible growth ever. Oh, and we're flat. Netflix actually might be a good example of that. Uber might be a good example of that as well in the sense that - Tesla. Tesla, yeah, yeah. Because, well, they've got the robots, so maybe, I don't know. But the thing with Netflix, right, it literally went from 0 % market share to whatever it is now. You're right. They've probably still got plenty of growth ahead. But they're never going to - They're never. I don't care how well they execute or how favorable the conditions are.

1:03:04They are never going to maintain those early rates of growth. because going from a million to 10 million was a walk in the park. You know, going from whatever it is now, you know, 100 billion to, you know, 800 billion, it's a different story. Trees don't grow to the sky. So you get this inevitable slowdown just as markets become more saturated and it's like, well, now you've got Paramount Plus, you've got Apple TV, you've got Stan, you've got all the others as well. Like it's just sort of like, and I'm not trying to make the bear case for Netflix other than just to sort of say, even when you're trying to factor in above average growth, you still have to reconcile with the fact that that above average growth will not remain above average forever, right?

1:03:44Unless you can pull another rabbit out of the hat. So maybe that's the Tesla example. It's like, okay, we've got that early uptake of electric vehicles and that's really good. And yes, definitely before the Tesla fanboys start adding me, yes, there's still a long way to grow there. I'm not saying there isn't, I'm just saying the growth potential on that particular vertical isn't as good as it was in the very early days, maybe they can extend that growth, the rate of growth by introducing a new product. So all of a sudden, Optimus hits the shelves and we've all got a robot butler and boom, off you go again, right?

1:04:15Or some other kind of batteries or whatever it happens to kind of be. But these are the things you've got to think about. It's like, what's the growth going to look like? How long is it going to last? When is that PE going to normalize? Is it going to normalize by the earnings increasing? And you can do this and you can be as thorough and as diligent as you possibly can. And you'll still be left with making a million guesses, right? So you just, you recognize that you're probably going to be flawed. You're out in the margin of safety and you scatter your bets. And then, you know, it tends to be a really good process, but there's no formula here that's just going to go, I'll do this and it'll work every time, right?

1:04:51It's just not. But just as I look, the bottom line here is don't shy, don't consider a stock can be on a PE of 100. It'd be much cheaper than a stock on a PE of two. Easily. Yes. So don't be too. Right, exactly. It doesn't sound right. But so don't be too silly with your thinking. But at the same time, even if they're super successful, they're not going to stay at a PE of 100 forever. They almost can't. I mean you follow it through to its logical conclusion and you literally are the global economy and then people are you can only grow as fast as the economy because you are the economy and even then people will still pay 100 what does that mean?

1:05:34take it off the share market and take it away from share prices you just own the business and you own it outright okay 100 times earnings and let's assume those earnings are all free cash flow, there's no money needed for reinvestment to maintain your capital equipment or to invest for growth. You're just going to, every single last cent of profit you're going to take out of that business that you own outright every year, it's going to take you 100 years to get your money back. And that's assuming no inflation over that century. Exactly. That's the proposition. And the market goes up too, by the way, while you're waiting for your money back.

1:06:07So you're also losing to a bogey that's getting further and further away from you while you just want to justify the current price you paid. You've got to, I think it's, it's why that, I forget how he says it. But Buffett talks about, you know, you should be happy to buy a business if the share market closed for 10 years. And what he's really getting at there. Or he often says, you know, my favorite holding period is forever. And it just does people's brains in because, you know, the midwit sort of, you know, sloping forehead take on that is that you only buy shares so I can flick it to someone else.

1:06:36And that's how I make money. Shout out to Australian residential property investors while we're here. What really matters, what really matters is what's the cash flows are going to generate. housing is a great example, in fact, right? So I was like, if I own a house and after maintenance costs and my rates and everything else, this is going to throw off, say, let's call it a 10 % yield to make the math seizure. It's like, I hold this thing, you know, okay, let's ignore inflation to make the math seizure. It's like, it pays itself off after 10 years and now I've got a perpetual security that's going to pay me this forever.

1:07:08That's worth something. And absolutely in the context of a world where, you know, rates are at 3 point something percent, it's like, that is a really good bet. if you're holding an asset whether it's a residential property or it's a business that they if the market were to shut and if your only hope is to be the greater fall theory that i can flip it to someone else and the only way i'm gonna if i can't do that and the only way i get a return is by extracting the actual cash from this productive asset if that's going to take me a hundred years and that's a bad investment it's just a bad investment period You might get away with it during periods of exuberance.

1:07:46But think about this, dude. You remember this when was it COVID times? And we had some of these big companies trading at 20 times sales. Revenue, like not profit. That's like, let's assume that we have no costs. This is 100 % margin. Even then, it's going to take you 20 years to get your money back. Like if I frame it to you like that and say, do you want to buy my business? No, that's why private businesses sell for lower multiples, by the way, as well, because you don't have the option to flip it to someone else. So when someone is looking at acquiring a business, they very rationally and objectively look at it through the sense of like, well, I think it'll grow like this.

1:08:27How long does it take me to get my money back? And how does that compare? What's the opportunity cost? How does that compare to a term deposit or, you know, 15 other million types of assets? If you can think that way, you've got a massive edge, a massive, massive edge. Never invest where your success rests entirely on the good mood of irrational, emotional, scared human beings. I don't want to play that game. I mean, it doesn't mean you can't actually do really, really well getting lucky on that, but trying to regulate any - But that's the same with a casino. Correct. Exactly right. Yeah. Yeah.

1:09:02Yep. Absolutely. Great question. A very good question.

1:09:09Doesn't it make it so beautiful as well, right? It's kind of like, oh, the shares are down. It's like, yeah, but each year on my purchase price here, I'm getting a 15 % fully frank dividend. I'm pretty cool. And by the way, I look at the business like, yeah, nothing wrong with it. It'll still be there in 10 years time. Like, am I upset that when I open up my ComSec app that there's a red number on there? Yeah, of course I am. I'm not going to pretend otherwise. But like, I feel very good about that as opposed to something that was actually not as to spit out any cash flows whatsoever. And now I can't find some other idiot to flip it to.

1:09:41Like that is a very different story, right? I do want to touch on Nessie's question about the AI bit because I think that's relevant. Kind of falls into the tech stuff I mentioned, but it is relevant. I think we've probably covered it by inference with the other answer, but you asked it directly, Nessie. So I don't want to talk to it. So, AI is a really hard... AI is like tech or the internet, right? So, what is AI? Is it Google that has AI as part of everything else, including search and web storage and everything else? Is it companies using AI to do things better and more efficiently? Is it the chip makers?

1:10:20Is it the data centers? Is it all of that? Is it none of that? So, it's all... And I'm not going to go for asking the question, mate, but the It Depends answer comes out pretty quickly here. I've said for a long time even if you look at healthcare healthcare includes nursing homes that actually frankly I don't mean to sound disrespectful to nursing home residents they're basically property rates with a small operating business that's how they're priced how they're valued and you've got health insurers and you've got hospitals and that's all healthcare it's like well kind of but same with tech what's tech?

1:10:51is Amazon tech or is it a retailer? Amazon's a tech is Walmart a tech has it got an online store? no Well, Amazon's got some physical stores as well. So is that no longer tech? No, it's still tech. Okay. And Apple, is Apple tech? Kind of, yeah, but it's also consumer products. So I don't know what AI is next here. And again, I'm not being obtuse here. It's just a hard one to answer. I suspect that there will be companies who either pure AI or use AI meaningfully as part of their core operation that do manage to find ways to grow and grow quite quickly. If that's the case, then their PEs deserve to be higher because they've got more growth in the future than maybe the market either expects or appreciates or just it did in the past.

1:11:33So when you see, I'll pick Google for fun, I own the shares. If Google's for you guys from 20 to 24, right? And you kind of go, well, it's getting more expensive. The question you gotta answer is, as we said before, is it gonna grow faster than it used to? If 20 was fair, it might've been, it might not. Let's say it was. Now it's 24. Are you comfortable it's gonna grow that much quicker based on having some AI opportunities? If the answer is yes, brilliant. If the answer is I don't know or no, then it tells you what you need to know. I have a working hypothesis. A bit like the, who won from the internet?

1:12:04Who made money from the internet? Almost nobody in any meaningful sense. Most of the value actually accrued to the consumers, which is brilliant, right? Why? Well, is Amazon an internet company? Yes. Can it exist without the internet? No. Did it make money because it was the internet? No, it's a retail that managed to find a way, a channel to sell its products. So now it doesn't exist without the internet. So it's arguably an internet company. but kind of, you know, Woolies, massive growth in click and collect and online delivery. Now, does it make more money on that? Kind of no, actually, because what'll happen is I'll use it and you'll use it and Coles will compete with them and they'll probably compete away that much and hopefully I'll get a benefit because I get my groceries home delivered.

1:12:43So using AI... It's how more technology should accrue to the people, frankly. And it tends to. It tends to over time. So the question, I mean, you get some monopolies like Google Search, for example, which are kind of, you know, they don't get competed away. So the question really nasty, and that's a great segue, Ram, is if AI is going to create sustained additional profits for a company, then it should have a higher PE. And that PE will eventually mean revert when growth goes back to normal, but it could be another leg of growth for, frankly, an extended period of time. If it's just being used by a company to stay competitive, like the internet, that gets competitive away real fast.

1:13:18And it's just staying business costs, right? It's like, well, can we just exist without the internet? I mean, kind of, but G. Coles gets all the online and click and collect delivery. So it will lose its share, it loses its sales. So does it use the internet to become more profitable? No, not in the end. It uses the internet to stay competitive. So what does AI do? I don't know, mate. I would be careful on assuming AI allows, changes mean reversion at all. Actually, in the long term, it won't, by definition, because we've just talked about it. In the medium term, you can expect it to be less mean reverting or less quickly mean reverting if it accrues, additional profit, profit, not just sales, and not just usage to a company that does it.

1:13:58NVIDIA might be one if the GPU, graphics processing unit chips, continue to be all the rage and no one else produces them and whatever, then yeah. But again, think about supply and demand. If RAM comes out of the eye with a straw man chip, which is only half as good, but costs 10 % of the price, well, I'm going to buy five of them and I'm going to spend less and actually have more compute power and NVIDIA is stuffed. Now, will it happen? I don't know. RAM's probably working on it right now, as we speak, I would suspect. But, you know, so I would be really careful about saying AI, therefore higher PE, therefore more growth, therefore whatever, whatever, because we've been there before.

1:14:30It was called the dot-com crash. And just be careful. Now, I'm not saying AI is a bubble. I'm just saying be careful not to assume that there's extra value accruing to those companies permanently that would justify a higher PE unless they're doing something their competitors can't do or unless it's adding more profit because they've added more services. So, I mean, Google, again, back to that, Google Gemini, if it can remain successful, is something else people will pay for because they want access to the AI. And if Google can provide that profitably and not have that competed away, then that will make more money because I'm already paying for Gmail.

1:14:59I'm paying for Google Storage. Now I'm paying for Google Gemini as well. I'm spending more ARPU, average revenue per user goes up. They're more profitable. That makes perfect sense. But just be careful. If it gets competed away, don't pay twice for the AI bump. That helps sales but doesn't help profit. Yep. I agree with all of that. Yeah, it does. I mean, it's hard, right? Because there's these technologies, what they tend to do is they tend to be a lot of money made in them. You're right that the value accrues to the consumer, but there is a loser. Like, so for example, the internet, print media, traditional journalism, classifieds, all of that just absolutely disrupted.

1:15:43and I've said many times in the pod and I'll say it again, I think the best investing opportunities always come with structural shifts when we just invent a new way of doing something. Like, you know, the best time to invest in, I mean, there's not many car manufacturers I'd touch right now, but, you know, cheese forward was probably a great investment back in the day, right? You know, because you've literally got a market that just didn't exist before. And like that, it might come at the expense of horse and buggy operators. Yes. And yes, we as consumers are better off, But that as an industry can do very well.

1:16:16And we've talked before, you can actually go lose market share and still do well because that particular pie, that sub-pie of the bigger pie, is still growing really, really, really fast within all of that. I think we'll see a dynamic. I don't even think it's a controversial thing to say. I think we'll see that dynamic with AI. It'll encroach on other areas. Yes. It'll extract some value there. Speaking of internet, I mean, search. Yes. Does Google search, does it, and shares. If you do Google Search, you get an AI response. You go, good, I'm done. Thank you. I'm not clicking on an ad. I've got the answer.

1:16:48What does that do to search volumes? What does it do to search revenues? I don't know. Maybe AI replaces, ChatGP becomes a search engine. Yep. You know OpenAI is introducing ads, right? Are they really? On ChatGP too, yeah. They assure us it won't influence the quality of the answers, but you will see ads, which is a whole other topic, but it's like, you know, it's scary. You know there's going to be all kinds of silly buggers with this kind of tech. You ask your AI, what thing should I buy? And it's like, well, I get paid to tell you that this is the one to buy rather than me objectively scrutinizing all the available data.

1:17:19And if you don't believe it, check TripAdvisor and all those other things. The amount we're paid may impact our search rankings. Like, yeah, you better do it. Of course it does. Yeah, absolutely. So I don't, what do you do with AI? Pay attention to it. It's a thing. A lot of value will be created. It's hard to know who the exact winners are. I certainly wouldn't dismiss it out of hand, but at the same time, just because something has an AI label on it, I'm not buying it just for that sake. It comes back to what you said, mate. Will this lead to materially higher earnings than would otherwise be the case for me, regardless of who the winner and losers are outside of that?

1:17:56Then, yeah, then it's a thing. We'll find out. It's happening right now. It really is. And it's so cool. I mean, as a kind of a nerdy, I'm not a huge tech, tech, tech nerd, like not really the deep, but like just the guy, I'm a gadget nerd from way back and the AI revolution is just getting started. It's going to be incredible. It really is. It's a new world. I mean, it's, it's, it's the other thing I always think too is technology's dovetail, right? Like the great example, my favorite example is with flight, modern flight. It couldn't have happened without a really good materials engineering, like, and, and the, and the qualities of aluminium.

1:18:35it couldn't have happened without uh circuitry it couldn't have happened like there are all these enabling technologies is ai exciting because it can write this and do this and search that yeah it's kind of cool i think what's really cool is the second and third order coins like oh it'll rapidly accelerate drug discovery you know uh it will rapidly understand increase our understanding and advancement in nuclear fusion technology i don't know i'm pulling out some big things here as well but i think that that that so it's kind of you might actually be someone invents this great ai they don't really make any money but someone uses it to crack fusion exactly and all of a sudden the world's completely upside down right or actually robotics is a great example at the moment of some of the cool stuff that's coming out of figure and and even boston dynamics at the moment it's sort of like you know as i've said to you before like the the actuators and a lot of the a lot of mechanical stuff hasn't really advanced that much it's the brains that are making the the arms and legs and that move that is rapidly advanced.

1:19:30And that's a great example of AI encroaching into another domain and, and being an enabler for a different technology, you know? And it's just like, we'll see more and more and more of that. And we will look back in 30 years time, just as we do today. Cause I remember what everyone was saying about the internet is like, yeah, it's kind of true. Some of those things, but it's like what we, what the internet actually became or what we actually use it for, you know, No one predicted that the, what is the big game changer of the internet? Oh, sharing cat videos. That's what we use it for. What, but no, but this and the, yeah, yeah, yeah, yeah, we do that too.

1:20:08We've got YouTube. We have a lot of people sitting in cars, giving monologues, you know, about hot takes on various political and economic things. Like, it's like, okay, didn't pick that. Just stay off my lawn. That's what we do, God damn it. Get the hell off YouTube. That's right. We've got a podcast, stop it. We really should be on YouTube. Inforts just go away. We should be on YouTube. Yeah, we should. Although, I'm not sure. I've got a good head for radio and a good voice for print. I just mean for different channels and all that. You've got to, you know, blah, blah, blah. See how we go. I might have to spruce up a little bit.

1:20:41Or not. Did you spot the holes in my shirt, by the way, when I said... They had good holes. They had good holes. Let me see, people. Nothing revealing. You'd be happy to know. I don't know. So in theatre of the mind, people can imagine and maybe their imagination is better than the reality. That's all I'm saying. I watch a lot of podcasts these days. Do you? Yes. Why? I think it's the same reason that I will do a video call instead of a phone call. You know, a lot of communications, nonverbal. You, you know, I mean, I love listening to podcasts. I listen to a lot of podcasts when I'm walking about and I walk a lot, right?

1:21:17But when I'm at home, it's just like I like to see, even if I'm not paying attention, I like to see the face, the expression. I think you get a bit more out of it personally. Okay, because I watch the videos where there's something to – I'm demonstrating a thing. Yeah. But I actually find it harder to watch that stuff because it's easy to get distracted, I think, on a screen. That's true, too. I can kind of – and I tend to listen, as you say, when I'm walking or mowing or doing whatever, so it's kind of like it's – I mean, we're way off topic. When the body's occupied, it's easier for the brain to pay attention.

1:21:48Yes. I don't know. I'm sure there's a medical – There's oven charts and stuff. I'm going to geek out on a lot of economic sort of podcasts and they'll be talking about stuff and they'll just be, you know, the chart or the thing is on screen and it's sort of like, yeah. I mean, that's the beauty of it, right? Each to their own. And the argument would be, I don't know why we're having this on air, but the argument would be it's just like it's a different audience, right? It's a different, not for you, it's for a lot of people and we're not catering to them, so we probably should. There you go. Share our beauty with the world.

1:22:21Poor bastards. I don't know at least I can monetize that one they may have a they may have a view on that one but we'll have to see how that all turns out anyway there you go all fun in the meantime thanks for spending some time with us we've probably done enough info at fool.com.au send us your questions send us your issues here's the thing I've said before if you like the podcast that's great if you don't want a mailbag episode don't send anything in if you do want a mailbag episode we actually got through a heap of questions so I'm kind of half pleading half letting you know there is plenty of options when it comes to yeah if you want to have your question answered now is a very very good time we've got some we've got some don't worry but yeah send us a question send us an issue send us a comment and we will happily address it and as I said Ram will tell you exactly why you're wrong until then have a great week and full 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.