August 2026 Mailbag: The Scores We Keep

0:00For the past three weeks, Authors in August has handed the microphone to three remarkable thinkers and their books. This week, we hand it back to you. Because what good is a provocative idea if nobody provokes it back? So what happens when a middle school teacher takes Ti Nguyen's warning about scorekeeping straight into his classroom? And can you add up to an index fund? What songs belong on the Rule Breaker soundtrack? And then near episode end, the Fool Who Originated Our Pet perk series returns by audio with a favorite pet perk of his, one I suspect will raise a smile, have more than a few of you nodding along.

0:44Authors in August may be ending, but the conversation certainly isn't. Your reactions, your questions, your stories, your mailbag. Only on this week's Rule Breaker Investing. It's the Rule Breaker Investing Podcast with Motley Fool co-founder David Gardner.

1:06Welcome back to Rule Breaker Investing, the month that was. Well, it was our ninth annual Authors in August. We had three authors, three special podcasts. Let's briefly review where we've been this month. On August 5th, it was Ti Nguyen and his book, The Score. So our games philosopher, one of my favorite returning guests, Ti Nguyen, joined me to explore what happens when the scores and metrics meant to help us navigate life, start quietly determining what we value. The score, August 5th. Then on August 12th, I welcomed in a 40-year AI pioneer who helped us think about how to live and work alongside increasingly intelligent machines, when to trust them, when to question them, and how to make sure AI exercises our brains rather than making them lazy.

1:59It was Vasant Dar and his wonderful book, Thinking with Machines. And then finally last week, August 19th, Dave Ulrich, The Why of Work, one of the world's leading thinkers on organizations and human capability, joined me for a wide-ranging conversation about what makes work worth doing and what decades spent studying people and workplaces have taught Dave about meaning, about leadership, and bringing out the best in others. You know, looking back now, what strikes me about this ninth Authors in August is how much these books ultimately ask of you and me, of us, the reader, because none of them is simply dispensing knowledge to be absorbed.

2:43Each, in its own way, challenges us to exercise judgment, to recognize what we truly value, week number one, to decide when technology deserves our trust, week number two. and then last week to think about why we spend our days doing what we do. These are books that hand responsibility back to you and me, to the reader. And maybe that's what made this such a rule-breakery, authors in August. The future keeps arriving. There are more metrics, more machines, more systems designed to make decisions easier for us. And yet becoming smarter, happier, and richer has never meant outsourcing your judgment.

3:25It means developing it, knowing what you value, thinking for yourself, putting your time and talents toward things worth doing. So that's not a bad three-part takeaway from three very different books. And my thanks again to those talented authors for spending their time with you and me this August. All right, we have five mailbag items this month before we get started. it. Just a quick minute about the Fool Community Foundation. You know, this is such a passion project for me and for many other fools. I'm chair of the Fool Community Foundation, and I want to mention something new that I want to put in front of you while classrooms are still getting settled in these few days and weeks.

4:12We're building something called the Fredometer. It's a free investing simulator for high schoolers, and it does one thing really well. It shows a 16 year old what their life looks like if they start investing at 18 instead of 28. Most people don't skip investing on purpose. They just never picture themselves as the kind of person who invests. So we're not building the predominant alone at the Fool Community Foundation. Teachers around the country are testing it in their classrooms, telling us what doesn't work and helping us fix it. We're taking applications now for the next group of founding teachers.

4:49So if you teach, or if you know a teacher who'd be great at this, send them to foolfoundation.org slash teachers. That's foolfoundation.org slash teachers. Thanks. All right, on to Rule Breaker mailbag item number one. Hi, David. My name is Matt, and I'm a middle school English teacher and board game lover living outside of Raleigh, North Carolina. And Matt has to insert, this hurts me just a little bit as a graduate of the University of North Carolina Chapel Hill, he has to insert go pack. But anyway, it's Matt's note. I have to honor it. My dad, he goes on, introduced me to the fool as a preteen.

5:31The brokerage account he started for me would eventually fund my graduate school education. So I am grateful to you and the fool for the wise investing values and recommendations. And that's very kind of you to say, Matt. And I know we're both grateful to your dad, since he's the one who really made it happen. And that's awesome. Matt goes on, I'm writing because I thoroughly enjoyed your conversation with Teen Nguyen, which solidified my own musings on value capture in education. As I started teaching last summer, I quickly discovered the extent to which organizations gravitate toward what is quantifiable and what is observable from afar.

6:09I entered the discipline excited to boost kids sorely needed grammar, their spelling, their vocabulary skills, which seems to be atrophying. Matt writes, at an accelerated rate in the age of spellcheck and AI searches. Yet he goes on, these areas are entirely neglected in our curriculum because our end of year test is multiple choice. Since the school and its teachers are evaluated exclusively on these scores, our administrators have understandably optimized for them. This results in a completely different educational experience than I or previous generations received, for better or for worse.

6:51Your discussion with Nguyen about grade point average and law school rankings validated my experience and led me to the following conclusion. When we game the system for the sake of test scores, we drain more joy out of learning than we realize. Matt concludes, were lawmakers and administrators really trying to restrict creativity and increase student stress levels when they instituted these tests? Probably not, but the convenience of the pass-fail metric is too sweet to give up. So, we deal with the consequences. Fool on, Matt. Well, first of all, Matt, thank you for writing in. And there's a lot to chew on there.

7:37You know, there is there is a distance problem. You mentioned things that are quantifiable and what is observable from afar. And that's a pretty terrific formulation. the farther away a decision maker gets from the classroom. Let's say it's the principal or the district or the state legislature. It does seem to me the more necessary that a metric becomes because the metric is what travels. And that's obviously one of Tin Nguyen's key points and what you're reflecting back. And what gets measured may become what gets taught. There's that old song business. If you can't measure it, you can't manage it.

8:14Or what gets measured gets managed. I'm sure a lot of us have heard that line before. You're offering sort of a darker corollary. What isn't measured may eventually stop getting done. Grammar, spelling, vocabulary. I hope not, but perhaps even curiosity, creativity, intellectual courage. So a beautiful question for all of us, occasioned by that thought is this. What valuable thing in your own work or life, dear listener, are you neglecting simply because nobody is keeping score of it? And let me go on, Matt, to say the good news here is you are in the room. So yes, you as their teacher can see the things the standardized test cannot.

9:02So I don't think your job is to rebel against the man, rebel against the scoreboard. Your students do need to do well on that test. As you know, your school reasonably cares whether they do. But I do think you're close enough to see what the test can't see. So maybe part of the calling of a great teacher is to honor both, to prepare kids to succeed on the score that somebody else has created, but quietly keep your own richer scoreboard of what an educated young person is becoming. You know, I'm thinking about business. The CEO sees the big picture, like employee turnover statistics. But then at a lower level, a good manager knows why Sarah is thinking about leaving.

9:49The statistic can tell somebody something's happening across 10 ,000 employees, but the person close to the work can tell what it means. And I don't think either should replace the other. And in fact, Dave Ulrich last week gave us a related idea. He said organizations ultimately depend upon leaders understanding what actually motivates individual people, not merely the aggregate workforce. And so here's one more beautiful question I'm going to give you, Matt, and you can ask it of yourself. What are the three things that you hope your students leave your classroom with that will never appear on their standardized test?

10:29You know, if you're able to answer that question and then arrange a process, a framework, some time, or even some metrics toward your own goals for those students, that is a powerful way to supplement with what really matters to you, what your students are learning in the classroom. I realize a lot of teachers feel pressure to teach directly to the test, describe the world as time strapped, and they have a hard time just covering the material that will be the subject of the test. But I hope all teachers hearing me, and in a sense, we're all teachers, aren't we, might ask ourselves that question again.

11:06What are the things that I hope my students leave my classroom with, my kids leave my family with, that will never appear on the standardized metrics and tests in the world at large? Something to think about. Before we move on to Rule Breaker mailbag item number two, I have to read Matt's postscript because this is the gamer portion of the note. And as a gamer, I have to reflect this. So Matt, thank you. He closed out by saying, while I'm here, I can't help but pass along a game recommendation. As a fellow Stratomatic baseball childhood devotee, and that means, Matt, both you and I have played a lot of Stratomatic dice baseball in our youth, you go on to say, there's a game called Dead Ball, baseball with dice that, in Matt's opinion, is the ultimate customizable tabletop baseball simulation experience.

11:57He goes on to say he's created an entire fictional league with the game, which has provided hundreds of hours of joy. And that makes me smile, Matt. And you also mentioned, Matt, you've designed a card game of your own. It's called Insurgent Algeria. It's published by Catastrophe Games. You mentioned it tackles an understudied or underappreciated Cold War conflict with a simple rule set you put into the game. You close by saying it would be an unbelievable full circle moment if it appeared on Games, Games, Games. And let me just say, Matt, I love that full circle ambition and congratulations on designing and publishing your own game.

12:37That is awesome. Insurgent Algeria probably won't make the Games, Games, Games podcast this year. just because for that annual podcast, as you might know, I generally need games that have reached really broad distribution. So it needs to be easily clickable and findable with dozens of copies on Amazon, because it turns out people listen to these podcasts, and they actually go out and buy the games. So we have to have fairly widely distributed games. I will say, though, that yours, at an earlier, smaller stage, having looked at it on BoardGameGeek, I see the people who have played it have rated it very highly.

13:11So I'm happy to give it a plug. right here. One gamer to another, Matt. Thank you for your note. Keep up the great work as a gamer, certainly, but even more as a teacher. All right. This one comes from Logan, Logan Callanan Atterbury. Logan, thank you for this. Hi, David. Thanks for writing the Rule Breaker Investing book. I'm about halfway through it. Logan writes, and already it's a top five investment book for me. Thank you so much, Logan. You're going to say I read about 20 or so a year, so I'm especially flattered and you are way out reading me out there. So keep up the great work. Logan goes on, I am wrestling with something.

13:49Chapter two created a lot of friction for me internally, but ultimately I believe you are right in this add up concept. Now I'm going to pause it right there and briefly explain add up for new listeners or people that haven't come across Rule Breaker Investing. Habit number two for the Rule Breaker Investor, which is chapter two as well, is entitled Add Up, Don't Double Down. And my intent with that is to get stock market investors when it's time to add new money, money that you've saved. And you're thinking, you know, which stock, maybe I won't buy a new stock. Maybe I'll add to one of my existing positions, one or more of my existing holdings.

14:29Which ones should I add to? And in my experience, most people tend to add to the ones that have not done very well. They think about rebalancing or they think if I liked it at 20, I should really like it at 12. And so a lot of people in my experience put money toward the ones that aren't doing well. And so they double down, as the phrase goes. And I, of course, believe is a rule breaker, especially for rule breaker stocks. Doubling down can make sense in other contexts. But this is rule breaker investing. And I think I've always been much better rewarded by adding up, by looking at the ones that are doing well, reminding myself of the answer to the timeless question.

15:08What do winners do? The answer is winners win. And so, Logan, as you encountered chapter two, you found yourself somewhat challenged by this because perhaps like many worldwide, you had been adding to the ones that had been going down. So Logan goes on then, I have been doing the opposite. I have been doubling down for a decade. So it has been a course correction to be sure. Would you or your team share your perspective on the below question scenario I present you with. I know it's different than what you emphasize, but curious if this concept transfers to the index fund space. Logan goes on, we've been investing in custodial accounts for our two daughters, and my strategy has been to use various indices through our bank, Schwab.

15:55And Logan lays out SCHG. Well, all of the tickers start with SCH because they're all Schwab funds. There's a G, a B, a D, and a Y. And some of those, for example, are a large cap growth or the B is broad market. The other two are about dividend payers, both domestic. That's the D and international, which is the Y. Anyway, Logan says monthly I have been investing new money into whichever of those four is the lowest amount. Based on the add up, the mental model applied to indexing. I guess I should add to the biggest historic gainer, which Logan mentions happens to be SCHG, the Large Gap Growth Index Fund, would you apply that principle to this sort of account and strategy as well?

16:42The money, of course, is mostly long term and purpose, maybe for a car purchase or home down the road. And ideally, it sits and grows for decades as they head into the workforce. No pressure on this. And of course, we won't take any of this as personal financial advice. Just made me think as we were doing some long term thinking and knew you would have an interesting perspective. And on a side note, we do invest in individual equities for our portfolios. We have some fun successes over the past few years. Logan cites Cisco Systems as one example, getting more and more comfortable with individual stocks as a larger percentage of our assets.

17:18Thanks for what you do. Signed, Logan Callanen-Atteberry. Well, let me start by saying, Logan, great job saving. Great job establishing those custodial accounts for your daughters, playing the long game for them, letting that money compound over time. I and my siblings were so greatly benefited by parents who did exactly the same thing. So congratulations. It's not always easy to do at different points. It may be harder to save. A lot of us have a hard enough time saving for ourselves, let alone for our kids. So congratulations. Now you're asking whether habit number two, which I invented to speak to investors about individual stocks, whether that is appropriate for index fund investing.

18:02And let me just first talk about individual stocks. So I particularly find habit number two, add up, don't double down, very helpful for individual stocks. And that's because to me, price appreciation isn't just a stock going up. It's actually information. It's telling you, it's showing the market's reaction to the company you're now a part owner of. And as prices appreciate, what the market is saying is, we see you, we're watching you, company, we like what you're doing, we like your profits, we like your prospects, we appreciate your stock and therefore your stock appreciates. That is basically how the stock market works.

18:45So price appreciation is information. And when I'm given that information and I have new money, you can see why I prefer to add up because price drops are similarly information as well. And while there are cyclical stocks that rise and fall and rise and fall and other types of stocks, you know that I'm focused on rule breakers, the ones that I hope go lower left to upper right over time that go up over time. And so price appreciation is information. And the reason I invented the habit or have abided by it ever since my father said to me when I was 18, David, don't throw good money. That would be your new savings after bad.

19:26In other words, don't add to your losers, add to your winners. What we're doing with that habit is we're counteracting the human tendency. I would say the majority of us probably have to think when we see something that's gone up, I guess it's already gone up too much. I shouldn't add money to that one. And again, while that can be true of some stocks for rule breakers, I think it's generally the opposite of true and why it's such an important habit for me. Now, let's go to the main point you're asking about, and that's mutual funds. And does this work for mutual funds when you have four Schwab index funds to choose from?

20:03You mentioned you've been adding to the one with the lowest amount when you have new money each month. By the way, I'm kind of wondering why you would add to the one with the lowest amount of money. I guess that's a form of rebalancing. But I would think with your mutual funds, you might have a goal or a strategy. Maybe it's to equally balance 25 % in each of those four different funds for the overall account. Or maybe you're trying to put more toward growth and not as much toward dividends. So the first thing I would check is, do I have an overall strategy of allocation? Why have I picked those four funds?

20:35There's a lot of overlap, by the way, from some of those funds. I think between the large cap growth and the broader market index fund, there's probably you're double holding big companies like Apple or NVIDIA, which is not, by the way, a bad thing. But it does remind me as well that for a lot of mutual funds, the ones that are market cap weighted, you should also realize that when a big company, let's say Amazon or Microsoft, when these companies rise in value, they actually start to weight the fund toward those companies. So if you're still with me on this, in a way, you are adding, your fund manager is adding more to the winners as they become larger and larger allocations within that fund.

21:19So in practice, in part, what's happening with those index funds is they are adding to the winners or the winners are becoming larger portions, individual stocks within that fund. So I guess I would just close by saying, I don't think there's any right or wrong answer here. I'm glad you asked the question. I do want to say back that I really think of this habit as applying for individual stocks and I wanted to make sure you knew the why behind the habit not just what the habit is but why I think that way we form habits most of the time so that we start to mechanically do better things if they're good habits than we would have if we weren't in the habit but I also want to say that habits are just habits it doesn't mean they're rules it doesn't mean you blindly follow them all the time.

22:06It means you use your own judgment, you look at nuance, and you realize there are exceptions sometimes to the rules. So I want to close by saying that was a wonderful non-answer to your question, and it's because I don't think the question has a definitive answer. It's more that I wanted to provide you thinking around the answer to help you, I hope, arrive at your own best answer. I want to close out by saying thanks a lot for writing in and for your kind words about my book. In fact, I hope you'll share that book someday with those daughters of yours. And thank you for writing in full on, Logan.

22:40There are moments that define who you are and who you're becoming. And when those moments arrive, what you drive should rise to meet them. The Range Rover Sport commands attention from the very first glance. Every line, every detail engineered for impact. Inside, refinement takes over with sculpted 22-way heated seating with available massage and a 13.1-inch touchscreen that puts everything within easy reach. But the Range Rover Sport isn't just about luxury. It's about uncompromised performance, too, delivering a powerful, agile drive that feels as confident as it looks. And with nearly endless ways to personalize, from interior finishes to wheels to unique colors and accessories, your Range Rover Sport becomes unmistakably yours.

23:26For those who expect more from every moment, there's a vehicle designed to meet it. The Range Rover Sport. Exclusive offers available now. Explore further at RangeRover.com. All right, on to Rule Breaker mailbag item number three. Now, on last month's mailbag, one of our longtime correspondents started helping us build out a Rule Breaker-inspired Spotify song list. And Ken in Springville, Utah, brings some serious moxie as he makes more contributions to our Rule Breaker Spotify song list. Hi, David. During your July 29th Rule Breaker Investing episode, you included some suggestions for a Rule Breaker playlist, which caused the wheels in my head to start turning.

24:14Here are some further suggestions broken down into RBI-related subcategories. Please feel free to use as little or as much of this list as desired. I've been a fool for many years, listening and enjoying your podcast every week. Keep up the great work. Fool on from Ken. Thank you, Ken, in Springville, Utah. Now, I counted it. Ken has 39 tracks, and they're broken down very thoughtfully. They're curated into little rule-breakery categories. I am not going to share all 39 here, but I am going to share nine, along with the categories Ken puts them in, And my talented producer, Bart, will be including the full list in the show notes for this week's podcast.

24:54So if you find yourself wanting to build up even more Rule Breaker tunes and surround yourself with your AirPods or your headphones or just out there in nature, if you just want to make it ring, you want to make it sing, Ken in Springfield, Utah has our back. So here are nine examples of songs he would add to your Rule Breaker Spotify playlist for brand new investors. Don't Be Afraid by Boston Go Your Own Way by Fleetwood Mac For Watching Investments Compound and Grow He includes among three others, sure Celebration by Cool and the Gang For Spiffy Pops, Ken has six songs in mind I'll just call out Can't Help Fallen in Love by Elvis Presley For Paying Our Capital Gains Taxes, Ken has just one That would be Don't Fear the Reaper by Blue Oyster Cult Let me see a few others here.

25:47Selling stocks? Well, Neil Sedaka, Breaking Up is Hard to Do. And for the inevitable market downturns, Ken suggests, yeah, he's got seven different songs in this list. I'll just call out I'm Still Standing by Elton John. When deciding to buy a new stock, How Will I Know? by Whitney Houston. Two more. How about Before You Figure Out Your Sleep Number? She and Him. Now, I needed Bart, my much more knowledgeable producer about music, to explain to me that Zooey Deschanel is the she in She and Him. And while She and Him have done a few, I think it's holiday albums, If You Can't Sleep might not be on one of those, maybe one of their more obscure hits.

26:29But for Rule Breakers, for people trying to figure out our sleep number, If You Can't Sleep by She and Him. And the last one I'll call out just for overall optimism for our optimistic Rule Breaker attitude, Ringo Starr, life is good. Again, all 39 songs broken down into 16 different categories are yours if you just click into this week's show notes. Let me also mention, Ken was not humble bragging. He was not hot-dogging it when he said this, but he did include in his note that he had pulled these songs just from the A through M, the letter A through M portion of his iTunes song collections. So there's probably a lot more out there than just these.

27:14We've ignored the N to Zs. Ken, thank you so much for the fun and full on. All right, on to mailbag item number four, Andrew Gibson writing in, David, I received a phone call from a dear friend of mine who's been retired now for about a year. We used to talk about your podcast when we were on the railroad together. So on this most recent phone call, we started talking about the stock market. for a while. And he noticed that Palantir had increased 29 % that very day, which was more than our original purchase price two years ago. We both bought in using the principles, Andrew writes, that I learned from you over the years.