Are We Headed For a Recession? + How Tariffs Hurt Housing (Live at SXSW)

26:19Keep in mind, just a short 80 years ago, we were rounding up Japanese Americans, some of whom had kids serving in our military in the European theater, and we put them in camps. To believe it can't happen here is, in my view, totally ignoring history. And I think we have all the steps in place. If you look at what's happened in the past and other nations that have gone really dark, what we're missing, quite frankly, and the reason I'm so freaked out about this data is a severe economic shock. because the people in power aren't going to take responsibility for it. They're going to find a scapegoat.

26:52So I think that America is very vulnerable to a series of dark steps right now. It is on a path to something very dark. And I think the missing piece to go even darker would be a severe economic shock. And this looks like we are not only setting ourselves up for a recession, but potentially something worse. That was awful, wasn't it? Sorry. Take everything I say with a grain of salt. Yeah, the crowd's going wild. When we look at how the stock market is reacting to these policies so far, it hasn't been good. And what's so interesting is that if you look at the global stock market right now, minus the US, so take all of the stocks, exclude all of the American companies, the global stock market is up 7.5 % year-to-date so far.

27:47So basically, we're having a uniquely American problem in the stock market right now. Now, what's interesting has been Trump's and his administration's response to this. And I just want to read you a quote that he said to Congress in his address to Congress. He said, quote, there will be a little disturbance, but we are OK with that. and Scott Besant, the Treasury Secretary, he went on CNBC. He gave one of his first big public speeches on TV and he said, quote, the market and the economy have just become hooked and we've become addicted to this government spending. There is going to be a detox period.

28:31So in other words, the markets are not liking what's happening, but I'm a little surprised that Trump isn't actually pointing fingers and blaming Biden, as I would have expected. Instead, he's actually owning up to what's going to happen. And they're saying, yes, this might hurt. We might feel some pain in the economy, but ultimately it's worth it. This is necessary. This is our medicine and we're going to do it. I'd like to get your reaction to that, Scott. Is there validity in that argument? Is it fair to say that America maybe needs this shakeup, they need this pain, and will suffer in the short term, but that's worth it.

29:11So there's a lot to unpack there, because the notion, the Dow Jones Industrial Average and the NASDAQ are two of the most damaging metrics ever invented, because they create the illusion that America is doing well if the NASDAQ is up. 90 % of stocks run by the top 1%. A more important number would be deaths of despair or rates of self-harm among teens or life expectancy. Our life expectancy has gone down. It's just started to go back up again. But we're obsessed. If the NASDAQ and the Dow are up, we fall into this false or this cold comfort that America is doing well. The bottom line is the Dow Jones Industrial Average and the NASDAQ are largely indicators on the well-being of the top 1%.

29:52And spoiler alert, they're doing really, really well. So if the stock market goes down, you're right, it's not the end of the world. The key is what is the issue that's bringing the stock market down? Natural corrections are really important. The reason I get to lead the life I lead from an economic security standpoint is just as I was coming into my prime income earning years in 2007 and 2008, the economy crashed. It got overvalued. And the government decided to bail out banks for$700 billion, but they didn't bail out the economy. And just as I was finally starting to get some money, I was able to buy Apple, Amazon, and Netflix at$7,$8, and$12 a share.

30:32And I was able to buy Florida real estate at a really good price because we let the markets drop by not artificially pumping them up with deficits. COVID comes along. Greatest intergenerational theft in history was COVID. A million people dying would be bad, but people my age losing wealth would be a tragedy. So they flushed$7 trillion into the economy, 85 % of which wasn't spent, not needed, wasn't spent on medication, wasn't spent on housing. it was saved, which means it went into the market, which took stocks to new unnatural highs, took housing from an average of$290 ,000 to$415 ,000, which basically is nothing but robbing opportunity from young people that need disruption and an entry point at a good value, such that my stocks and my houses stay elevated.

31:21So everything we have done over the last 20 years is essentially ensuring cementing my prosperity on your credit card. So the market's coming down because we're not going to artificially inflate them with deficit spending, which is nothing but a tax on you that's delayed. Fine, or they're overvalued. But the reason stocks are coming down now is because people realize that we are destroying very prosperous alliances. We are being very inconsistent about our economic policy. You know, last night at Vox had a party and a lot of our advertisers are there. And there was two automobile companies. And they both said, and I've talked to a bunch of media companies, they've said, ads are down because auto companies and housing in different parts of the economy are literally in a state of paralysis.

32:08They don't know if the average car is about to increase in cost by$12 ,000. There was an exemption yesterday. Now there's not an exemption. Who gave money to Trump? Can you call him? What can we do here? right? So that is having a huge impact on the real economy. So the stock market coming down because it's overvalued or because we're not willing to prop it up to keep me rich on your credit card, fine. But the stock market is going down now, not because it's having air let out of it. It's coming down now because America is making really bad decisions that similar to Brexit, we're trying to figure out an elegant way to raise costs while reducing our productivity.

32:48So it's like, how could we elegantly reduce the quality of life, the purchasing power, and the prosperity of Americans really elegantly? And we are figuring it out. It's so funny because often the question is, okay, you have the losers and you have the winners. Who are the winners? Who are the losers? It's very, very difficult to identify a single winner in this. But I have identified one, and that is options traders. So zero-day options trading is exploding right now. And this is what a zero-day option is, basically an options contract that expires within 24 hours, and they've reached a record high.

33:24I really had to scrape the barrel to find a winner here. But it is striking that on this technical level in the stock market, the people who are being rewarded here are not the value investors. It's not the people who are investing long-term into the real economy in America. In fact, they're getting burned. The people who are winning in the stock market are the traders, the gamblers, the speculators. It's basically the people who want to make a quick buck off of volatility because volatility is one of its highest ever right now. So I kind of look at what's happening in our economy right now where we have an explosion in crypto.

34:05We are seeing record sports betting. And now I'm looking at what's happening to the stock market, it feels as though we're devolving from an investment economy into a gambling economy. Would you see it the same way? And does that concern you? Yeah, our economy used to be run, I would argue, people say that we have an attention economy, right? That we try and figure out algorithms to keep you engaged, such that we can sell you more ads. That's how the economy runs. I would go one step further and say that our economy is actually an addiction economy. And that is the most valuable companies in the world essentially are trying to figure out your anthropological weaknesses, tap into those, and keep you glued to your phone by a series of indignance, negative feedback, positive feedback, enraging you, get you addicted to your phone.

34:56Because there's so much money in addiction. Now, we talk a lot about young men. Men are much more inclined to be risk-aggressive. And by the way, risk-aggressiveness comes in really handy, right? If Russian soldiers come pouring across the border, you want some of that big dick risk-taking energy. You want aggressiveness. The power of our economy, I think, is risk capital and people willing to leave their job and start a business or approach a stranger. This is a key component of our society. But unfortunately, that risk aggressiveness among young men is being exploited by gaming companies. The net income of every company with a major presence in Vegas is off 40 % this year.

35:48Why? Because that risk aggressiveness is being served up on people's phones with gaming apps. 50 % of college males bet on the Super Bowl. Zero-day options are nothing but gambling. And if you look at the overall stock market, we don't like to admit this, the stock market was initially meant to be a source of financing for companies. And about$300 billion of it, traditionally a year, is for IPOs and secondary offerings. It's a place to access capital for growth. But the number of trades each year is$3 trillion. So 90 % of the stock market is me thinking, I'm smarter than you, and I'm going to bet against you because you're selling me a stock at a price that I think is under or overvalued.

36:30valued. So we are becoming, effectively, if you look at the economy, the most valuable companies in the world, the way we design public policy, our economy is really based on addiction. And the most valuable companies in the world are trying to give young people, mostly young men, a sense that they can have a reasonable facsimile of life on their phone and get them addicted to gaming, get them addicted to the affirmation of others, get them addicted to porn. And also, I learned this from my mother who was a docent at the Bellagio when she lived in Las Vegas in her senior citizen years. The addiction that has the greatest suicide rate is gambling.

37:10Because if you have a meth addiction, people are going to notice. And friends and loved ones are going to weigh in and try and stop it. If you have a gambling addiction, you can get in so deep and no one has any idea. And you get to a point where you feel the only way out is suicide. And I worry that essentially all we're doing again is tapping into our worst instincts, trading off our worst instincts for shareholder value. And this is another example of that. I don't know what to do about it. You can't infantilize people. I think if they want to eat themselves to death, that's their right. I think if they want to gamble, that's their right.

37:45But be clear. Here, we are essentially trying to figure out a way to convince young men that they should just stay home, not go through the pain of getting a job, not establish real relationships, not establish real friendships because they have discord, they have Reddit, they have Robin Hood, and they have you porn. That doesn't end up in a good place. This is nice. Sorry.

38:13Sorry. Well, let's talk about housing now. Stay with us.

38:43Sierra is the platform for building better, more human customer experiences with AI. No hold music, no generic answers, no frustration. Visit sierra.ai to learn more.

39:03We're back with Prof G Markets. Home builders are warning that tariffs could increase the cost of building a home by up to$10 ,000. Here we go. rising lumber prices will inflict most of that pain about one-third of the lumber used in the u.s is sourced abroad and 70 percent of that lumber comes from canada given our dependence on the our neighbor to the north the threat of tariffs has sent the u.s home construction etf down 19 percent uh since december scott i just want to put you in in my shoes um i'm 25 years old, I would love to... Talk to you. Can you believe that? Literally, can you believe that?

39:50Seriously. Let me make my point. When I was his age, I was like, what was I doing? I was driving a Renola car, thinking about going to see Squeeze at the Greek Theater. And like, anyways, well done. Well, ignore that part. Well done. My point is, I would like to own a home someday. Got it. But the average price of a home in America today is$420 ,000. It's near a record high. In New York City, by the way, where I live, it's$1.3 million. That's the median. Yeah. The average age of a home buyer today is 56 years old. In 1980, it was 30 years old. So I see this headline, and I see housing costs are going up even higher.

40:38what would you say to someone like me a young person who's trying to have a good career is trying to make it who wants to own a home someday and then i see this news that home prices are only going to go up well look i i think people who are successful and have been blessed with some economic security have a right to try and make things cheaper so i want to commit to you that if you continue to work this hard and demonstrate this kind of talent uh that i'm going to buy a second home. I love that. I love that. You can always tell because his face gets very morose and serious. I know when it's coming.

41:16I'll tell you what, it's going from an unpaid internship to a paid. Look, the first thing is, this is a complicated issue. The first thing is, and I think as Democrats, I think we need to transition from being the party of indignation into the party of ideas. And if you look at right now approval of Trump, it's somewhere between 50 and 60 % among every age group, except it's 23 among 29 to 44-year-olds. In some, America isn't working for people trying to establish traction economically and think about starting a family. And to a certain extent, that's the most important age group because 40 years ago, 60 % of 30-year-olds had a kid.

41:56Now it's 27%. And people say, well, you don't have to have kids to be happy. I'm like, I agree, but you should have the option to have kids. And as someone who had no desire to have kids, I have found that raising a family with a competent partner is sort of the whole shooting match and does give you purpose. And it's also really important for an economy. The GDP of economies is directly related to how young their populace is, and our population is getting way too old. So back to advice for you. I think, first off, we need to stop this zeitgeist promoted by the National Realtors Association that you need to own a home.

42:30I don't think it's the best. It is not the best way to build wealth. If you count phantom costs, housing has gone up 4 % to 6 % or increased in value 4 % to 6 % a year because of all the costs of maintaining and owning a home. The market has gone up 8 % to 11%. The reason why it is a great wealth builder is because it's forced savings. because generally speaking, people will make their mortgage because they don't want the shame of being evicted. So what I would argue is a couple of things. One, just in terms of bringing the cost of housing down. Austin is actually a model. They passed a YIMBY, yes, in my backyard, that took the height limits off of construction and said, all right, you can go higher than whatever it is, 450 feet.

43:10In Minneapolis, they said, all right, we're not going to demand. They got rid of regulation. We're not going to demand that you have to build a parking spot, which costs about$50 ,000 per apartment. In Minneapolis, where they've increased housing supply and lowered the cost, rent is flat. In the rest of Minnesota, housing is up 14%. So one, it's just increasing housing stock. And there needs to be more of innovation. Manufactured houses that you drop on a lot cost between 30 % and 50 % less than houses built on site. So one, do away with the notion that you have to own a home to be an adult or commit to a relationship.

43:47So I think we need to get rid of that, but we need to replace it with other opportunities for young people to develop economic security. I would go the other way, and that is try and encourage people to have a smaller home. Homes keep getting bigger. And my advice to younger people is that your success is going to be inversely correlated to the amount of time you spend at home. and that is I'm not saying don't have a nice home but what I'm suggesting is is that we would be better off in terms of building economic prosperity for young people and giving them the opportunity to have families if we said to them okay we're going to figure out a way for you to have less expensive housing and then give them opportunities that incent them to invest in the market through some sort of forced savings program where we say like they do in the UK if you put up to 10 ,000 pounds in this retirement account we'll give you we'll top it up by another 20 or 25 percent So the notion that you failed if you don't own a home, we need to get rid of that.

44:40Two, we need a massive increase in building. And secondly, the housing crisis is not only a housing crisis, it's an affordability crisis because we aren't paying young people enough. Yes.

45:01But so I think it's getting rid of, it's Yimby, yes, in my backyard. The biggest mistake we've made in housing is similar to the mistake we've made in higher education. And that is our culture has become a rejectionist LVMH culture. And that is once I own a home, the biggest mistake we made in housing was taking housing permits out of the hands of bureaucrats who looked at the whole picture and made decisions based on what was good for the community. And we put it into the hands of homeowners. And homeowners love the idea of coming up with reasons for why there's too much traffic and too much density and asking for more information and basically slowballing and slow rolling and killing new housing developments.

45:4375 % of the zoned real estate in America is for single-family housing. It shouldn't be that way. 24 % of the costs of a new home are in permits. So when you put housing permits in my hands, my incentives are to sequester new housing, such that the value of my home, which I already own, goes up. The same things happen in education. Once you have a degree from an elite university, you just love that it's now impossible to get in because it takes the value of your degree up. So we need to flip it and realize that a massive overabundance mindset of freshman seats at good universities, and it shouldn't be drill, baby, drill.

46:22It should be build, baby, build, and also massively increase, in my view, through tax credits, universal pre-K,$25 an hour minimum wage, such that we go from one-third of you can own a home to two-thirds. It's not anyone's birthright to own a home, but you would like to think that the majority of people would at least be able to afford housing. And then again, I think the key is to make it less expensive, give people additional income, and then create a better way to save and build economic value than the message from the National Association of Realtors that you never go wrong investing in housing.

46:54Because people believe that. They become house poor. They overextend themselves. And then it creates an illiquidity in human capital where they can't move because they don't want to give up their mortgage or they're underwater and they don't move to where their human capital would be best spent. So I think we need a total change in mindset around housing, massive more building of homes, yes in my backyard legislation, and also simply put, people between the ages of 25 and 40 figure out economic policies that just put more money in their pockets. Yeah, I think Austin is a great example. Just some data here.

47:26The housing supply in Austin has increased 14 % in the past two years. As a result, rents have declined 22 % since 2023. That's the largest rent decline in America. So I think that's a good place. Off a big number though. Come off a big number. Yeah. But yeah, let's clap.

47:49At least try to end on a little bit of optimism. That's pretty much our show, but I want to end here with one of our favorite segments, which is the algebra of wealth. And this is where Scott tells us how we're all going to get rich. Yeah. Yeah, no problem. Be born a straight white male in 1964. Scott, let's keep it quick so we can do the Q &A. But based on everything we've talked about, is there any advice you would give to our audience on how we can build wealth ourselves? Well, just along the lines of housing, if you're fortunate enough to be with a partner and you're thinking about how do I, the key is, the key is, I think, how do you develop economic security for you and your family?

48:29And try and ignore the instinct that you're going to die at 35. Because 99 % of our time on this planet, we've died before the age of 35. We have a tough time actually believing that you're ever going to be my age. And that is, if you're 30 sitting in this audience, it means you're probably healthy. It means you're probably wealthy. It means you're probably going to live another 70 or 80 years. And so the key is, I mean, here's the good news. I know how to get you rich. The bad news is the answer is slowly. And what I would suggest is that you adopt the forced savings of a mortgage, but you create a mortgage around another investment class, and that is stocks across the U.S., low-cost ETF funds and non-U.S.

49:06markets, because I think the U.S. is going to underperform international markets over the next 10 years. But try and figure out a forced savings plan that is tax-advantaged. Commit with your partner. And rather than making a mortgage payment, so rent in Austin is about$1 ,500. The average cost of a home is about$3 ,000. I think a reasonable way to economic security is to say to your partner, all right, we're going to have a fairly modest home. We're going to try and spend as much time with friends, with family outside of the house. And we're going to take that incremental$1 ,500 a month in housing savings, and we're going to force a mortgage on ourselves, hopefully through some sort of tax advantage vehicle through our employer or through the state or through the federal government.

49:43And we're going to create a mortgage. And every month, we're going to pay our mortgage, but our mortgage is going to be low-cost ETFs. Because over the medium and the long-term, those return 9 % to 11 % versus 4 % to 6 % in housing. So buy into the notion of economic security and a forced savings plan, but create a mortgage that forces you to invest in the markets and realize you're not failing if you just have a modest place to live and try and spend more time outside of the house. Create a mortgage, but instead of putting it into housing, put it into the markets. Thank you very much, Scott.

50:18This episode was produced by Claire Miller and engineered by Benjamin Spencer. We got to do the credits. Our associate producer is Alison Weiss. Mia Silverio is our research lead. Isabella Kinsel is our research associate. Drew Burrows is our technical director and Catherine Dillon is our executive producer. Big list of people and they're all over there.

50:38Thank you for joining us. If you liked what you heard, give us a follow on Prof G Markets. And now we've got a little bit of time for some audience questions. I think we have some mics up here if anyone would like to ask a question. We've got about five, 10 minutes. Awesome. Thanks guys. I'm Justin, Orange County, California. for folks who might be lucky enough to have kind of their house in order with the low-cost ETFs, et cetera, et cetera. What are some of the things that you can get like a little riskier on that you would suggest in like a 40-ish year old person? 40-ish. Look, so let me be clear.

51:16I have most of my money. I'm very diversified, but I buy and sell options. I buy individual stocks because I can't help myself because I'm under the illusion that most people are under that I can beat the market. But what I do is I sequester that to 30 % of my total portfolio. And then I'm not going to tell you how to risk up. Just buying individual stocks that you think you have insight into, or whether it's crypto, small amount of money in Bitcoin or whatever, I'm going into Latin American and European ETFs because I think those markets are going to vastly outperform the US market. And because I'm still a bit of a dope addict, I'm doing these 2X funds.

51:54that put leverage on them. So you are going to have no trouble finding additional alpha and risk, or I don't know if you can find alpha, you can definitely find risk. Even buying an individual stock is risky. But what I would say is sequester it to 30 % of your portfolio. Your base, your go bag is 70 % in low-cost index funds. And also my big piece of advice around that is if you're just in the S &P in American stocks, be careful because there's a crazy step So we've all heard that 50 % of the market capitalization globally is now represented by U.S. stocks. You think, oh, my God, half the world's value is in the U.S.?

52:33It's worse than that because if you include debt, the enterprise value of a company is its market capitalization plus its debt. So if you're a company worth a billion dollars in terms of your market cap, but you also have$500 million in debt, the market is saying that company is worth$1.5 billion because they're taking into account that it owes$500 million. If you count debt, if you incorporate debt into the enterprise value of U.S. companies, the total value of all publicly traded companies globally, if it was$100, 70 of it is the U.S. So think about this just as a shopper trying to buy value.

53:11Right now, you can buy the U.S. for$70 or you can buy the rest of the world for$30. That, to me, says that the U.S. is probably overvalued and the rest of the world is undervalued. So I'm not only suggesting you be in ETFs that diversify you, but that you're geographically diverse. Because if you look at under or overperformance of the U.S. versus international stocks, it's cyclical. There's usually 10 to 15-year under or overperformance relative to international stocks. and U.S. stocks have been overperforming international for 16 years. And if you're like me and believe everything is cyclical, it means that we're probably going into a decade of underperformance in the U.S.

53:57and overperformance abroad. In terms of risk, you'll have no trouble finding risk. And then in 10 years, you'll come back and say, I was stupid. I should have just done ETFs. Thank you. Thank you for the question. Hi, my name is Corinne Hurt. I'm a doctoral candidate and researcher at the University of Southern Indiana. I completely agree with your comments on the young generation being red-pilled, basically. What are you getting your doctrine in? Education. And my dissertation is on historical revisionism and fascism. So my question to you is this. Did I get my definition of fascism incorrect?

54:27You're going to forget my best. No, I think you did great, actually. That's why I'm asking the question. What practical insights do you have for educators? I mean, maybe not just related to young men, but for how do we stop this? How do we stop when you say this, where this slow roll into fashion? Yes, the democratic backsliding. Well, first off, thanks for what you're doing. I think education, by the way, is a really wonderful career. I'll just go on a rant about education. The problem with education is too many old people won't leave. And that is you're going to go, hopefully get tenure, and there's going to be a bunch of 85-year-olds who were the bomb in Gap 1 accounting in 1983, and they won't fucking leave.

55:06And the problem is it creates It's a lack of upward mobility for young academics. Now, having said that, I think academia is a fantastic way to make a living. It's a fantastic way to add value, be around young people. It's the only thing I've done for this long. Anyway, so I think you've picked a good career. I think that I'm going to go more to a strategy around how, quote unquote, those of us moderates, moderate Republicans, moderate Democrats and Democrats, how we sort of push back on what are some emerging themes that you understand history if you're alarmed by it. What I would say is what not to do is to be emotional incendiary and wave your cane and interrupt State of the Union addresses.

55:46I just think we look like idiots. I think we look emotional. I think we look reckless. And it tickles the censors of the right and it turns off moderates. I think what we need to do, if in fact you're not comfortable with what's going on right now, is realize you don't need to respond to every issue on Twitter or TikTok. And to also recognize the DEI causing helicopter crashes, the Gulf of cheaper eggs, even the male versus female bullshit in terms of semantics, that is all a weapon of mass distraction to get you to look away from obvious, incoherent, ridiculously bad government decisions. specifically what I would suggest is focus on one or two issues.

56:27You're obviously an expert or have your real domain expertise around fascism. So focusing about writing about that, the similarities, try and resist the temptation to talk about all the outrageous shit, because what is going on right now is they want you to look over here and get upset and angry and not talk about the fact that, let's be honest, this is all a distraction from the following. We are surrendering to a murderous autocrat. And two, we are about to explode the deficits$800 billion a year such that I can have a tax cut. So the most powerful people in the world have this unholy alliance with the Trump administration right now.

57:03And that is even though they quote unquote care about democracy and everything, your rights are strictly, unfortunately now, entirely correlated to your wealth. Roe v. Wade doesn't impact me. I can get mesifestrone for any woman in my life. If they start rounding up people, I can shove Bitcoin up my ass and peace out to Dubai and have a really nice life. I will always be able to vote. I will always have access to politicians. Why? Because I'm rich. And this is exactly what's happened. And this is what happened in the 30s is Hitler had these unholy agreements with the rich and corporations that if you back me, I will give you favorable treatment.

57:42I'll destroy the unions. I'll go company by company and not pass systemic laws that say, whoever kisses my ass and gives me money makes more money. And that was part of the key descent into fascism, long-winded way of saying, don't have an emotional reckless response, focus on the one or two things you're really passionate about, bring experts, bring data, bring the adults in the room. And then, you know, I would say for wealthy people, the spinelessness of wealthy people who have this cold comfort that they'll always be able to buy rights, which is unfortunately true, they'll always be able to protect their daughters.

58:16They'll always have access to family planning. They will always have rights. It's really frightening right now because the powerful among the U.S. are not speaking up. Look at how many Fortune 500 CEOs have said anything, anything about what's going on. They were really happy to shitpost Biden because they knew Biden wouldn't come after them, that Biden respected free speech and rule of law. Now they're succumbing to this chill that's been put across and that there'll be a reward if you just pay these people. So anyways, I think what you're doing is important work, being disciplined, fact-based, putting out content, being fearless about it.

58:56But I think as Democrats, we need to have a less emotional, reckless response. It is not working. Thank you. Thank you. Thank you. I think we could do one more. Yeah. Thanks, guys. Chad from New Jersey. I believe we need to normalize talking about personal finances amongst our peer groups and with our parents. Do you agree? And how do we start doing that? I think so. I talk about my money all the time. I'm very transparent about my net worth and taxes. And I think some of it, as I really examine myself, is it makes me feel important and masculine because I'm economically secure. So let me be clear.

59:36I'm boasting a little bit. But most of it is I think we need to have, do you think I was, I met Randy Roddick last night. You don't think Andy talked about tennis all the time? If you're not talking a lot about something and sharing ideas with your friends, you're not going to be very good at it. And there's a real issue among, it's the genders don't talk about money for different reasons. For women, it's considered not sexy, right? You're not supposed to talk about money. Like it's uncouth or not good manners. And for men, you're supposed to be accidentally rich. Like I don't even try. I'm just such a fucking baller.

1:00:13I don't need to think about money. I just make so much money because I'm such a man. And I think it's really important that people open up and talk about their taxes, their net worth, their economic stress, such that they get much better at it. And it's hard to read the label from inside of the bottle. I mean, the wisdom of the crowds is incredible. I guarantee you, if you get together, I love investment clubs with a group of people, one, don't feel shamed, right? Oh, shit, I just lost 80 % in investment. I'm wondering if my apartment's too expensive. Because what you'll find is, one, other people are struggling, too, right?

1:00:48The people who are economically secure are traditionally the people you don't know. And two, you'll get ideas. You'll start learning about stuff. And you'll think about, and you'll hear from a friend that, okay, you know there's a program at work, or this is why you should negotiate for options instead of more salary with that job offer because options and equity grow tax-deferred. That's how you build wealth. I constantly talk to, I think we know a lot about the markets, I constantly talk about money to my friends, and I constantly get really good ideas around how I preserve wealth, how I make wealth, how I'm more tax-efficient, which is Latin for tax avoidance.

1:01:26But for God's sakes, just as we started talking about cancer 40, 50 years ago, that was really good. That made people feel better and less alien and less like a failure of someone in their life had cancer. Just as we started talking about mental illness just 10, 20 years ago, which is a wonderful unlock for people to reduce shaming and learn that other people are struggling too. One of the last taboos, we started talking about sex. I think that's a wonderful thing. One of the last taboos is talking about money. So being very open. Also, just in terms of blathering on here, a really key discussion you need to have with a potential romantic partner is money.

1:02:05The biggest source of divorce is economic strain. It's not infidelity. It's not a lack of shared values. It's economic strain. So making sure you have alignment. I don't make a big investment without telling my partner. That way, if it fucks up, So losing money doesn't strain relationships. It surprises. Wait, what did you do? And we lost it all? Well, okay, that's bad. But what upsets me is you didn't tell me. So I think sharing with your partner very early conversations, where do we expect to live? How much money do we expect to make? Who's responsible for making that much money? What's your approach to spending?

1:02:44Every big investment decision, even if the other person, even if the husband doesn't quite understand, that stuff and says to his wife, you're in charge of that stuff. I'm in charge of money and my relationship, but I always talk about our approach to spending, what we're investing in. I also find it's a great way to develop intimacy with people. Money is so important to capitalist society. It's way too important, let me be clear, but it creates a bond. I remember talking to my partner early on just saying, this is what I have. This is what I'm worried about. This is what I'm thinking about in terms of kids, and I'm worried we can't stay in New York.

1:03:17And then she told me how much money she made. This was kind of early in the relationship. And it really made us feel like closer together. Because here's one of the most rewarding things about partnering with someone and why I really believe we need to figure out a way to get younger people to hook up more and mate more and drink more. Let me be clear, having money is wonderful, but you know what was even more awesome was the making it and specifically making it with a partner, like having economic shocks, being worried about money, both of us working hard, both of us saving, and then both of us investing, and then both of us together getting to economic security.

1:03:58That's so bonding and it's so rewarding to build that with somebody. So I absolutely think on a lot of dimensions, sharing and opening up and being vulnerable and talking about and sharing best practices around money, I think it's an enormous unlock. I wish we could do more, but we are unfortunately way over time. Thank you so much. Thank you so much.

1:04:39In kind reunion As the world turns And the dark flies In love

1:05:09Do hours of research in an instant. With key insights from an AI assistant. Take a template with a click. Now your preso looks super slick. Close that deal. Yeah, you won. Do that, doing that, did that, done. Now you can do that, do that with Acrobat. Now you can do that, do that with the all-new Acrobat. It's time to do your best work with the all-new Adobe Acrobat Studio. Mercury knows that to an entrepreneur, every financial move means more. An international wire means working with the best contractors on any continent. A credit card on day one means creating an ad campaign on day two. And a business loan means loading up on inventory for Black Friday.

1:05:50That's why Mercury offers banking that does more, all in one place, so that doing just about anything with your money feels effortless. Visit mercury.com to learn more. Mercury is a financial technology company, not a bank. Banking services provided through Choice Financial Group Column N.A. and Evolve Bank and Trust members FDIC.