The Correct Opinion on 50-Year Mortgages

0:05Emily Peck: Hello! Welcome to Slate Money, your guide to the business and finance news of the week. I'm Felix Salmon of Bloomberg. I'm here with Elizabeth Spiers of the New York Times.

0:18Felix Salmon: Hello.

0:18Emily Peck: I'm here with Emily Peck of Axios.

0:22Felix Salmon: Hello, hello.

0:23Emily Peck: And we are going to talk about 50-year mortgages this week, whether they are a good idea or whether Congress is onto something when they say they are a bad idea. We are going to talk about ISS and Glass-Lewis and shareholder proxy advisory firms and whether they are a good thing or a bad thing. We are going to talk about bags of cash.

0:49Felix Salmon: Good thing or bad thing?

0:50Emily Peck: Good thing or bad thing. if you're pro bags of cash or anti bags of cash stay tuned to find out whether we agree with you we have a slate plus segment on an angle apropos the jeffrey epstein emails that you might not have really gone into a lot of given a lot of thought to but i will say that share appears

1:14Felix Salmon: somewhere in the segment but not in the emails as far as we know but not any emails as far as

1:19Emily Peck: we know. So maybe that gives you a clue. It's all coming up on Sleep Money.

1:31Emily Peck: So I want to start this week by talking about 50 year mortgages, because this is the perfect overlapping of like personal finance and policy and all of the nerdy stuff that we love here on Slate Money. And if you go on the internet, which I would highly recommend you don't, it turns out that absolutely everyone has an opinion on 50-year mortgages. My opinion is the correct opinion.

2:00Elizabeth Spiers: Felix.

2:01Emily Peck: But so far, I have been very good. I have not shared my opinion on the internet. The listeners of Slate Money are hearing it here first.

2:12Felix Salmon: Wow, breaking.

2:13Emily Peck: Yeah, breaking opinion right here. Elizabeth, before I tell you what the correct opinion is on 50-year mortgages, I want to know what your opinion is.

2:20Elizabeth Spiers: Well, first of all, thank you in advance for explaining to me what the correct opinion is. You're welcome, Elizabeth.

2:31Elizabeth Spiers: So I don't think that there's anything inherently wrong with 50-year mortgages, but I understand why people are enraged by the idea. because if you're able to afford a house, let's say when you're 20 or 25, which is increasingly not the case, the idea that you might die before you actually own it outright is horrifying to people. They don't want to be in debt forever. So I think a lot of the backlash is just the idea that it's just very difficult to own anything anymore. And this is not just houses. You have to pay for software on a subscription basis. just the idea of being in debt forever, I think, really horrifies people, even if it's a reasonable proposition overall.

3:15Elizabeth Spiers: So tell me why I'm wrong.

3:16Emily Peck: No, no. I mean, I think you're absolutely right. I think that is why people are horrified. I think they, like, we lost that battle decades ago.

3:25Felix Salmon: The battle of forever debt? The idea that a 30-year mortgage was something that you could

3:33Emily Peck: or would go ahead and buy a house with a 30-year mortgage, live in that house for 30 years, and then at the end of 30 years, you will have paid off your mortgage and you'll own the house outright. I'm sure there's still a handful of boomers out there for whom that is true, but very, very few. The median length of home ownership is about seven years in the United States, which means that the overwhelming majority of houses that are bought with a mortgage also sold with a mortgage. The idea of just staying in your house and never moving and slowly paying it off over 30 years without ever even refinancing is something that has always been just a tiny, maybe 1 % or 2 % of homeowners have ever done that.

4:22Felix Salmon: Also, the idea that old people don't have mortgage debt is not correct. Old people have mortgage debt, And that's a number that's been increasing a lot. Over the past few years, I was looking at an Urban Institute report last night. The share of homeowners, 75 or older, with mortgage debt, 30%. In 1995, it was 5%. And the debt is, it's like in the six figures for a lot of these people. So it's more common.

4:50Emily Peck: Yeah, I mean, I want to say this is not a bad thing. You know, having mortgage debt means two things. Number one, it means that they're more likely to have done the thing that we want older people to do, which is downsize when their kids leave the house and find themselves, you know, get themselves like a more sort of suitably small apartment and leave the large house with multiple bedrooms for the families who need it. And then when you do that, when you sell your old place and buy a new place, it's perfectly reasonable to use a mortgage to buy the new place, in which case you're going to have mortgage debt.

5:28Emily Peck: There is absolutely nothing wrong with that.

5:30Elizabeth Spiers: But in the U.S., debt is really stigmatized. And the only kind of debt that isn't stigmatized is mortgage debt because we've turned home ownership into kind of a value system. Anything else, including student loans, which are supposed to be a positive thing, are considered, you know, now markers of irresponsibility.

5:50Emily Peck: I don't know that many people who consider, especially like undergrad student loans to be markers of irresponsibility, but maybe I'm just hanging out with the financially sophisticated lot.

6:00Felix Salmon: I think if you don't pay the debt, then you're irresponsible.

6:03Emily Peck: Yeah, if you default on the debt, then maybe you're irresponsible. But Emily, can you like just tell me why we're talking about this?

6:11Felix Salmon: Yeah. So it's actually wonderful. Bill Pulte, the regulator of Fannie and Freddie, showed up at Mar-a-Lago with a poster, a three foot by five foot poster that had a picture of Franklin Delano Roosevelt on it and a picture of Donald Trump on it. And under FDR was like 30 year mortgage. And under Donald Trump was 50 year mortgage. And it was like greatest presidents was the headline or something like that. Politico reported.

6:36Emily Peck: And 50 is bigger than 30. Therefore, it's better, right?

6:39Felix Salmon: Yeah. So Donald Trump saw it and was like, great. and on Truth Social was like, we're going to do 50-year mortgages and then everyone hated it. MAGA hated it for the reasons that Elizabeth already said. Economists hated it because they were like, this is just going to mean people pay more money in interest than they do in principle and it's too long of a length of a term. Policy types hated it because they were like, we would need a law to make this happen because the only reason we can have 30-year mortgages now is because Fannie and Freddie exist and they buy up all the mortgages and backstop them because banks don't want to make loans with ridiculously long terms, as far as I know.

7:15Felix Salmon: So they need a little bit of incentive, which is that they can sell the loans and get rid of them and make more loans. For those of you who are watching on YouTube, that was indeed Emily gesticulating so much that she wound up bashing her microphone. So anyways, no one liked this idea, really. So then I guess Politico also reporting that behind the scenes, the Trump administration, Everyone's mad at Bill Pulte, who's done a lot of other shenanigans that we don't need to go into on this episode. But that, my friends, is why we're talking about 50-year mortgages. And since the poster board Mar-a-Lago situation, Donald Trump has then been on an interview with Laura Ingraham.

7:57Felix Salmon: Have I said her name right? Laura. Laura from Fox. Laura from Fox.

8:01Emily Peck: Laura from Fox.

8:02Felix Salmon: She asked him about this and he downplayed it. So it's probably not going to happen, but it's really fun to talk about.

8:09Emily Peck: Just to explain the role of Congress here, it's true that Bill Pulte at the FHFA does regulate Fannie and Freddie. But if Fannie and Freddie are going to buy a mortgage from a bank, it needs to be something called a conforming mortgage. And 50-year mortgages aren't conforming. And Bill Pulte, as the regulator, can't just wake up in the morning and decree that ipso facto 50-year mortgages are conforming. He needs an act of Congress to include 50-year mortgages among the group of conforming mortgages. And I think what people realized very quickly after Donald Trump raised this trial balloon was that there was really zero appetite within Congress for doing this.

8:57Emily Peck: and that's interesting to me and i think it speaks to exactly the kind of logic that elizabeth was talking about like there's just something intuitively about 50-year mortgage to use a technical term people are just like like they don't want to create this kind of race to permanent indebtedness what would happen if we had 50-year mortgages would be that people would use them, right? People always choose the mortgage that results in the lowest monthly payment they can find. And that's always the longest mortgage. That is, you know, unless there's some kind of steep yield curve and adjustable rate, something, something.

9:44Emily Peck: You know, we saw in the 2000s a few people doing the option arms and that kind of stuff because you got a better rate that way. but generally speaking if you have you know a 30-year mortgage that's going to be a lower monthly payment than a 15-year mortgage because you're paying it off over 30 years rather than 15 years and people are like great lower monthly payment and if there was a 50-year mortgage you would get a lower monthly payment there too but what that would do and i think people intuitively understand this, is that people bid an amount for the house that they will be able to service in mortgage payments.

10:25Emily Peck: And so if the mortgage payments go down because you have this new fangled mortgage, then what that does is it basically just means that house prices go up and the mortgage payments stay the same. You know what I mean?

10:38Elizabeth Spiers: I think Trump doesn't understand on this because he has always been comfortable with debt. You know, he's built businesses on it. He's destroyed businesses on it. And I think he's called himself the king of debt. Yeah. I don't even think it registers with him why this would be disturbing to his own constituents.

10:53Felix Salmon: I mean, I think it's fine. It doesn't solve any problems. Right.

10:57Emily Peck: Yeah. That's exactly the thing. It literally solves zero problems.

11:01Felix Salmon: Yeah. It literally solves zero problems because just the scenario you just laid out, Felix. Plus, if it raises demand for homes, it would raise prices for homes. And as everyone has pointed out ad nauseum. The problem is there aren't enough affordable homes available to buy at the moment. So increasing demand without increasing supply is going to raise prices.

11:19Emily Peck: If you want to make houses more affordable, build more houses. Don't faff around with mortgages.

11:26Felix Salmon: But that's exactly what FDR, the other president on the poster board, did, right? He created conforming 30-year mortgages, which didn't exist before, opening up a completely new market. But heretofore, Americans bought houses using loans that were shorter term that you had to pay off right away. Most people couldn't afford to buy houses at all. So he opened up the market with the 30-year loans. But then he also created all these programs to build and build and build tons and tons of houses. So that kind of working in tandem made a lot of sense. So if President Trump and his policy experts, of which Bill Pulte is just one policy expert, of course, I'm sure there are more.

12:07Felix Salmon: that they haven't fired, they could come up with, theoretically, a plan to unveil a 50-year mortgage in conjunction with a huge construction push somehow, like a building big thing. Like, that would be amazing and could actually be really interesting. But just, like, doing this on its own, probably not.

12:28Elizabeth Spiers: My favorite part of this story, though, is that there are people around Trump who are economists, who are policy experts, who probably present him with solutions to this problem every day. And Bill Pulte, in his twisted wisdom, was like, you know, Trump is never going to read or think about these things. But I will crayon him a picture. And that will be the thing that gets through. And he's right. It does. Now I feel like everyone who wants to influence Trump is going to come in with a three by five board.

12:57Emily Peck: Elizabeth, do you have a theory of the case for why Bill Pulte is enamored at 50 year mortgages?

13:04Elizabeth Spiers: That's a good question. I think it's just he He views it as probably a way of appearing to fix the problem without actually having to do anything that Republicans generally don't want to do, like build affordable housing.

13:16Emily Peck: I have a theory of the case of the one sort of actual good reason why this is a bad idea, if that makes any sense. Like, there are bad reasons why this is a bad idea. Like, you know, there was this quote from Mike Conksell, who I love, who's very smart. But he's like, but it was all part of you couldn't underwrite a 50 year mortgage for a 45 year old because they'd be like 95 when they're when it matures and they'll be dead by then. It's like, no, that's not how mortgages work. The good reason why this is a bad idea is that for historical reasons, which are related to exactly what Emily was talking about with FDR, the 30-year mortgage has become the number one most popular forced savings vehicle in America.

14:12Emily Peck: It is the way that people build up wealth. And you have to make your mortgage payment every month. And as part of that mortgage payment, you are paying down your principal and thereby buying equity in your home. And you are building a certain amount of savings in terms of home equity, little bit by little bit, month by month. and if you do that month in and month out for 30 years eventually you wind up owning a home outright and that is a relatively liquid asset that you can sell and have you know hundreds of thousands of dollars which you have just kind of magically accumulated over many many years of just making housing payments and that you wouldn't have accumulated had you been renting that house for the same amount.

15:07Emily Peck: So that's like, it's like this wonderful little way of quietly being forced to save money. And the problem with 50 year mortgages is that they don't do that. If you have a 50 year mortgage and you make your monthly payments month in the month out for 30 years, at the end of the 30 years, the amount of equity that you've built up is tiny, assuming your house hasn't gone up much in value. Because in the first 25 years of that mortgage, it's basically all just interest payments. There's very, very little in the way of principal payments. And so what you're doing in terms of building home equity is you're relying entirely on home price appreciation.

15:49Emily Peck: You're not relying at all on paying off your mortgage in order to build that wealth. I am not a massive fan of the 30-year mortgage as a wealth-building vehicle, but it is what we've got. It is the number one most popular wealth-building vehicle in America. A lot of people pay off mortgages who don't save anything for retirement. And if you switch that to 50 years, then that part of American wealth-building for the middle classes just goes away.

16:21Felix Salmon: I think about that a lot, the wealth-building of the home. It's like when I was doing my little Urban Institute reading about old people who have a lot of mortgage debt when they used to not have a lot of mortgage debt in that situation. There was some commentary about old people have a lot of wealth locked up in their homes, but they're kind of locked into those homes. Like they can't unlock the wealth without, I mean, you could refinance or you could take like a cash out loan or something like that. Or you can move. But the moving has become hard because home prices, I think they're up like 50, 60 percent since COVID and also rents are up.

16:59Felix Salmon: So like moving isn't as simple and like mobility isn't as free flowing as it should be right now in the U.S.

17:05Emily Peck: I mean, it's definitely true that the velocity of the housing market is down. But that's not because home prices are high. That's just because people feel locked into their mortgages. If you have a 3 % mortgage, which you got 10 years ago, and you're thinking about moving, then if you were to buy a house that was even cheaper than the one you're selling, your mortgage payments might go up because your mortgage is now going to be 6 % rather than 3%. This is entirely a function of mortgage rates having gone up. It's not really a function of people being old or house prices going up or anything like that.

17:44Felix Salmon: That's true. But yeah, a lot of these old people have all this wealth, but they're kind of like cuffed into it because of the rate lock scenario you just laid out, which is why I guess Pulte also was like, wait, it's not just 50 year mortgages. We're also going to do portable and assumable mortgages, which is a cool idea. Assumable is someone buys your house and takes over your mortgage. So it gives more incentive and theoretically gets the market moving again. And portable is you leave the house with your mortgage in a little suitcase with you so you can use it to buy another house, which I've not heard of that being a thing anywhere.

18:19Felix Salmon: Assumable is a thing right now.

18:21Emily Peck: I think there's one country where they exist. They're obviously difficult to structure because when banks underwrite mortgages, they assume that you are going to move in seven years on average. And so, like, if mortgages become portable, then they know that's not going to be paid off if, you know, mortgage rates go up. And so they're going to have to charge a higher rate for that portable mortgage than they would for a non-portable mortgage.

18:49Felix Salmon: Even though they sell the mortgages?

18:50Emily Peck: Yeah, because they sell them at market rate. But yeah, I think the fact is that no one really trusts financial misery as a solution to the housing problem. And it's probably not going to happen. But yeah, the kind of horror with which this proposal was greeted, especially on the right, has been really fascinating to me. And it's super interesting, especially in these, you know, Epstein-soaked days that we're living through right now. that we are beginning to see the limits of Donald Trump wants this, so let's all get behind it.

19:27Elizabeth Spiers: I don't know. I do think that that's largely a function of things being so much more expensive now. And while I don't think that the Trump voters who said, you know, we only care about inflation and that's why we're voting for Donald Trump, most of them were not being honest about that entirely. But I do think that when people are struggling financially, that will cause backlash even among some of the more diehard supporters.

19:49Felix Salmon: I was surprised that the Trump administration's floating all kinds of policies, all kinds of ways, all kinds of times. I guess for me, it was just a reminder of like mortgage and housing policy is actually interesting to normal, regular people.

20:01Emily Peck: People care about mortgages. They really do.

20:15Emily Peck: We should move on. What's next, Emily?

20:19Felix Salmon: Breaking. The Wall Street Journal is reporting, citing unnamed sources, that the FTC is looking into whether ISS and Glass-Lewis, the shareholder proxy firms, are breaking antitrust law over how they advise clients on stuff. Like, woke stuff.

20:38Emily Peck: I love this story, and I do apologize to listeners for having an entire episode, at least two-thirds of an episode, of Vaporware, and we're talking about things that haven't actually happened yet. We try to avoid that on this show. But this is also an interesting can of worms, which is that in principle, the way that public companies are governed is that the board of directors of a company is answerable to shareholders. And then shareholders do votes on various things at various times. And that's the way that the owners of the company, the shareholders, can have some kind of control or accountability from the companies that they own.

21:16Emily Peck: But because shareholders own such a – any given shareholder like you or me owns such a minuscule amount of the companies that we own, it just doesn't make any rational sense for us to spend the amount of time that would be necessary to spend working out how to vote on every single thing we're meant to vote on. And this is why individual shareholders famously, rationally basically never vote on anything that isn't Elon Musk's pay package. and it creates a gap in the market for like well so how do you vote these shares and the way it the way you wind up voting the shares in practice is that you hold your stock in some kind of an index fund or a mutual fund or a pension plan or something like that and then the index fund or the mutual fund or the pension plan says well how do we vote i don't know let's just ask these lovely friends of us at glass lewis and iss how to vote and they'll tell us and then they just do what they're told because they don't have the bandwidth to work out how to vote on all of these things either and so what that does is it creates basically this duopoly of these two companies telling everyone how to vote and the public companies don't like that because if iss and glass lewis suddenly wake up woke in the morning and decide they want you know esg something something governance, then these two companies can basically make that happen.

22:44Emily Peck: And they don't like that. And now it seems that they've managed to persuade the Trump administration that this is a bad thing.

22:51Elizabeth Spiers: I do not understand the antitrust case here, though. It's not like they have some kind of structural stranglehold on the market and the new entrants can't come in.

23:00Emily Peck: Yeah, no, well, I can answer that one. Like they, The antitrust case is just, do you have a monopoly? And the answer is yes. You know, if you have a duopoly and they clearly do have a duopoly, then that's the end of the argument right there. You do not need to prove that there are massive barriers to entry. You just need to show that there is a monopoly going on. And there is.

23:24Felix Salmon: I wonder why, like, we mentioned the woke thing, and I guess the White House doesn't like, and some Republicans doesn't like, you know, ISS and Glass Lewis having opinions about climate change or gender equality or whatever. But that's not why Elon Musk necessarily doesn't like these firms. He doesn't like them because they recommend against giving him a raise, I would assume. And I don't know exactly why JP Morgan, why Jamie Dimon doesn't like these firms, but I find it hard to believe it has to do with ESG. I feel like it's got to be just more like, don't encroach upon me. Like, don't mess with my vibe.

23:58Felix Salmon: I'm running this company, not you.

24:00Elizabeth Spiers: They're just an accountability mechanism, and they would rather not have them.

24:04Emily Peck: And especially when it comes to executive pay, right? They are the one realistic break on ever-spiraling executive pay. Because every board of directors is like, we want to be above average in terms of how much we're paying our CEO. And if everyone wants to be above average, then every time there's a new CEO pay round, like, you know, the median pay for CEOs just goes up and up and up. And the only way to prevent that from happening is for shareholders to step in and say, you know. And, you know, if you are the chairman and CEO of a$4 trillion bank, then you don't love it when a bunch of, you know, random shareholder proxy firms.

24:47Emily Peck: Yeah, I mean, they're just like, you know, it's like these anonymous people making nothing who don't know anything about what it is to run a bank think they know better than your board of directors how much you should be paid. Like, who are these people?

25:00Felix Salmon: But as Matt Levine points out, like, they do serve a purpose, actually. Like, BlackRock and, I guess, Vanguard, they can do their own proxy advising. Like, they can make their own recommendations and choices.

25:11Emily Peck: Yeah, BlackRock and Vanguard are so enormous that, yeah, they actually have the bandwidth to be able to make decisions individually on most of these things. And then Glass-Lewis, interestingly, has said that as of 2027, it's not going to make recommendations on how to vote, that you're going to have to pay it for a personalized set of recommendations, which I'm sure are going to be nearly always the same as the other guy's personalized set of recommendations. But they are already moving away from this idea of all shareholders should just vote this way on this proxy. Right.

25:50Elizabeth Spiers: Well, there is another firm, I think it was called, was it Broadreach or something like that? Yeah, something like that. They were smaller. And their sort of workaround here was to say, we're not going to make overt recommendations. We're just going to give you all the research and infrastructure that will lead you to make your own conclusion. Do your own research.

26:08Emily Peck: Which like, thanks, but no. Like that completely defeats the purpose. But this also, Elizabeth, speaks to exactly, you know, your case, there are low barriers to entry, so they're not really a monopoly. Like, it's really hard to enter this market. There are thousands and thousands of public companies. And to enter this market, you actually need to do serious time and effort into doing real work on what all of the different votes are for every single company. and yeah, that's hard. And if your, you know, attempted competitor is like, is saying, well, we'll do some of the work and we'll share some of the work, but we're not going to tell you how to vote.

26:52Maybe you can just take our PDF file

26:54Emily Peck: and plug it into ChatGPT and ChatGPT will tell you how to vote. Like that, none of this helps, you know?

27:01Felix Salmon: You just have to write, I mean, Trump isn't alone. Like everything should be written on a three by five poster board. It would make everyone a lot smarter, probably. Let's just say. Or dumber. But they'll know things. It would be more efficient.

27:14Emily Peck: The fact is that this is a war that the managers have already won. 99 % of votes go the way that management want them to go. 99 % of, you know, board of directors' nominations are unopposed. Companies can basically do whatever they want. and the amount of time that shareholders step up and say, well, no, here's a binding vote forcing you to do something that you don't want to do. That is rare as Hindsteith. It almost never happens. So what are we worried about? I mean, even Elon got his trillion dollar pay package.

27:56Felix Salmon: Felix, help me with this example. There was an oil and gas company a few years ago. Exxon. Exxon, that had a shareholder revolt of sorts, right?

28:05Emily Peck: And Engine 11, something like that?

28:07Felix Salmon: Yeah, there was a vote and they put like these climate activist board members got nominated or actually were put on the board.

28:15Emily Peck: Yeah. Right.

28:16Felix Salmon: But then I was reading in the prep that Exxon Now has rejiggered the rules where they say to shareholders now, we will cast your votes for you. Did you see this in the prep? Am I making this up?

28:26Emily Peck: Yeah, no, this is also like the dumbest thing ever. They're saying, yeah, if you want, we can just cast your vote for you and you automatically vote with management on everything. Which the fact is for most individual investors, what they do is just not vote, which is effectively the same thing. The only time you ever need individual investors to vote is for really out there corner cases like the Elon pay package where you need like a certain percentage of votes, a certain number of votes in favor. It's not enough that the yes votes outnumber the no votes. You need more than half of the shareholders to vote.

29:08Emily Peck: And it's very hard to get small shareholders to vote. But yeah, this is a solution in search of a problem, to be honest. The other thing that has been happening is that the other companies that are in the crosshairs here are precisely Vanguard and BlackRock, who are holding shares on behalf of individuals, right? And so again, the Elon Musk and Jamie Dimons of the world are saying, like, it's not fair that you know when your beneficial owners of these shares have a range of views on how the shares should be voted it's not fair that you just wind up voting all of the shares in one way it reminds me a little bit of like the electoral college you know they're basically saying if texas votes 40 percent democrat and 60 percent republican then it should send electors to the electoral college where 40 % of the electors are Democrat and 60 % are Republican, rather than just saying, well, whoever won Texas, all of those electors wind up voting for the winner of Texas.

30:14Felix Salmon: It kind of reminds me of arguments that people make against unions where they're like, workers need more freedom. They can't be represented by a union because it's not good for them.

30:24Emily Peck: Because some workers want something else. Exactly.

30:26Felix Salmon: But it's a canard. Is that a word? It's a canard. It's a canard. It's the way management argues against unions by ostensibly like touting the individuality of workers. But what they're really doing is trying to like fragment their power so that they can't have any sway with management. And that's similar here, I think.

30:45Emily Peck: I'm just going to come out and say, though, that I would much rather live in a world where the United States was a democracy and the candidate who got the most votes became president rather than this bizarre, dumb electoral college thing, which makes no sense.

31:01Felix Salmon: I think that's separate from shareholders and workers and things like that, having sway with companies.

31:06Emily Peck: It's kind of similar, though. It is similar. And one of the things that BlackRock and Vanguard have done to try and head off this argument is they've been like, well, if you want to vote your shares in a particular way, you can. It sounds good, but no one does it. So everyone realizes that this is like a very cheap thing for them to say because no one's going to take them up on the offer.

31:28Felix Salmon: But someone needs to hold these companies accountable. Exactly. Yes.

31:32Elizabeth Spiers: There's also a sort of underlying assumption, I think, on the part of people like Diamond and Musk, that if, you know, these companies didn't exist or, you know, BlackRock wasn't voting the shares of people whose money they have, that the shareholder decisions would be more favorable to them. And I think that's not necessarily the case. Right?

31:53Felix Salmon: Well, as Felix said, they're already so favorable. Like, geez, Louise, like, give it a rest.

31:58Emily Peck: You can't get more favorable.

31:59Felix Salmon: Like, my God, can you be any more demanding and entitled? I'm just saying.

32:13Emily Peck: We should move on to, Elizabeth, what's the last thing we're talking about?

32:17Elizabeth Spiers: Oh, so good. Robin Hood and GoPuff. You can get cash delivered to your door now. Just like you always wanted. Sadly, not in a burlap bag with a big dollar symbol on it, but still.

32:27Emily Peck: I mean, I'm sure for a modest extra fee, they'll do that. I love this because it's a couple of different things. Number one, Robinhood is just trying to distinguish itself in various ways. And so they're like, if you have some kind of a direct debit situation where you're paying$1 ,000 a month or more into Robinhood, and if you're paying us$5 a month for something called Robinhood Gold, then in return we will give you the privilege of paying another seven dollars to get cash delivered to your house which you will never do because no one in that world like ever uses cash for anything like the median age of a robin hood user is in their 20s or something what if you need drugs

33:14Felix Salmon: illegal drugs to be delivered to your apartment this is a good point you need cash you don't want to leave your apartment because you haven't ingested the drugs yet, boom, Robinhood is filling a need.

33:24Emily Peck: I do like this because, you know, your illegal weed delivery guy is coming in like an hour. So you now need your legal cash delivery guy to come in half an hour so you're having the cash on hand to be able to pay for the illegal weed.

33:39Felix Salmon: That's obviously the use case.

33:41Emily Peck: And also the name of the service is GoPuff. So it's right there in the name.

33:47Elizabeth Spiers: Robinhood says that, for one thing, the drivers will be unaware that they're carrying cash. But how does that work? You know, normally when they go puff driver or somebody who does these delivery stuff, they go and pick up the goods at like, let's say the fast food store or the drugstore, whatever. Where are they picking up cash and how do they not know it's cash? I have many questions.

34:08Emily Peck: They're picking up the cash in like a sealed bag from the same place that they pick up the ramen or whatever else they're

34:15Felix Salmon: delivering they deliver some expensive stuff apparently it says 200 bottles of tequila this

34:21Elizabeth Spiers: reminds me of cosmo.com you guys remember that yeah because they never delivered cash that's true

34:27Emily Peck: but the other thing that robin hood is doing here which we should just kind of explain is that there is this rich people thing if you are a private client of a very swanky private bank type situation and you have personal service from your private banker, you can be sitting around at home and go like, oh, I need to have some walking around money and I am far too fabulous to try and remember my pin at an ATM. So you just call up your personal bank and be like, can you drop off an envelope with a couple thousand dollars with my doorman And that way I will have money for tipping people or whatever it is I need cash for.

35:14Emily Peck: And that service you end up paying for in a million different ways because probably you're paying, you know, 1 % of your assets in wealth management fees. Your assets are$100 million. So you're paying like a million dollars a year to this bank. And so they're like, for a million dollars a year, yeah, we can drop off some cash with your doorman. That's fine. We will do that for you. And so what Robinhood is doing is it's creating this like facsimile of the kind of service that the very ultra rich people get. And it's like, hey, you get to live like a very ultra rich person, except for rather than having a private banker come to your door and drop it off.

35:47Emily Peck: They're just getting like a go puff guy.

35:50Felix Salmon: I have in my notes, ask Felix, is this a thing for rich people? And you just I didn't have to. You answered it. So thank you so much.

35:59Emily Peck: I also have no idea whether rich people actually avail themselves of this. Write us and let us know. Yeah, if you have$100 million, write in and say, dear Slate Money, yes, I totally just call up my private banker and ask them for cash. It's much more easy than having to deal with ATMs.

36:17Felix Salmon: I'm going to go out on a limb here and say, I think this is a cool idea because it's annoying to get cash now. It used to be I was, you know, getting cash all the time before I paid for things with my phone, before cards were everywhere and everyone's paying not in cash all the time. But now it's so rare that I use cash that I don't like recently I was at the hair salon and I had to tip in cash or so I thought. And I was like, oh, fine, they have an ATM. It's not going to be a problem. I took out my debit card. I hadn't used it in so long. It expired. So I had no way of getting cash. And I was like, oh, no.

36:52Felix Salmon: No, like, what am I going to do? Like, I had like a panic attack, but it turned out Venmo was usable. So it wasn't actually a problem. But I like the idea. And sometimes, you know, I live sort of in a remote-ish area. So going to the ATM, you often have to like go out of your way to go to the ATM, which is annoying. So it would be good to have cash delivered.

37:12Elizabeth Spiers: I could see that, you know, that sort of use case where if you have to get in your car and drive somewhere to get cash, that would be useful. But they're rolling it out in like New York. Well, yeah.

37:22Felix Salmon: That's true.

37:23Elizabeth Spiers: Walk to the bodega in a pinch.

37:25Felix Salmon: Yeah, but the bodega, that's where you get your number skimmed and everything. I feel like using ATMs now is a... Okay, grandma. It's like, you know...

37:34Emily Peck: Can I have the counterpoint? Can I put forward the counterpoint here?

37:39Felix Salmon: No counterpoint.

37:40Emily Peck: Your inability to tip your hairdresser in cash was a feature, not a bug, because otherwise, how would you have found out that your debit card had expired?

37:51Felix Salmon: I would have found out some other inopportune time when I was like really needing cash for some dumb thing.

37:56Emily Peck: I think it's broadly speaking a good thing to have a debit card that hasn't expired. And if you can use this as a way to remind you that your debit card has expired, then that's great.

38:07Felix Salmon: But I barely need it anymore, you know? You have the Venmo. Anyway, now I'm like undercutting my own point. But my point is that it's nice to be able to get cash delivered to your house. Why not?

38:17Emily Peck: We should mention that there is another piece of vaporware proposal on the books that people who use their debit card to pay for things are going to be able to pay much lower rates at retailers than people who use credit cards. And in fact, depending on what kind of credit card you have, you will pay more or less. If you have like a platinum card, you'll pay more. If you have a regular cashback card, you might pay less. If you have a debit card, you'll pay even less. And that there will be a whole range of different prices that people pay at retailers, depending on what kind of card they have.

38:52Emily Peck: And all of this is legal now, although, you know, I think we've talked about enough vaporware, for one.

38:56Felix Salmon: We decided not to talk about this, so I don't know what you're doing right now.

38:59Emily Peck: All right, we're not talking about this. We're going to have a numbers round instead.

39:03Felix Salmon: Cut it off.

39:13Emily Peck: Emily, what's your number?

39:14Felix Salmon: Oh, this is fun. My number is 19.8. That's a percent. It's the average tip at bars at 2 a.m. And that is when tips peak at bars. At 8 p.m., tips are closer to the 16 percent range. And this data is for the second quarter of 2025. And it comes from Square. And the bottom line is the drunker you are, the more you tip.

39:39Emily Peck: I like it.

39:40Felix Salmon: I don't know. There's not much more else to discuss here.

39:42Emily Peck: I guess that means that most people are happy drugs.

39:45Elizabeth Spiers: Yeah.

39:46Felix Salmon: Yes, you become more generous. It's actually nice.

39:49Emily Peck: I become more generous when I drink.

39:51Felix Salmon: Yeah, so I guess if you want to save money, it's not cut out avocados, probably like stop drinking so much or like go home early from the bar.

39:58Emily Peck: Exactly. My number is 20, which is also a percentage, which is very close to Emily's 19.8%. And 20 % is the proportion of billionaires who own controlling stakes in sports teams, according to a new J.P. Morgan survey of 511 billionaires. And I love the fact that people are doing surveys of 511 billionaires. 20 % of them now own a controlling stake in the sports team, which is up from 6 % in 2022. That's amazing. There's a massive spike in billionaires buying sports teams. This is the new billionaire toy. It's much more popular than Frida Kahlo paintings or gold toilets or whatever, the other yachts and planes and all of that kind of thing.

40:50Emily Peck: Controlling stakes in sports. Wow.

40:52Felix Salmon: One in five billionaires has a controlling stake in a sports team.

40:56Emily Peck: Yeah.

40:57Felix Salmon: That's amazing. I love that. Wow, good for them.

40:59Emily Peck: If I gave you like a couple billion dollars right now, like how long do you think it would take you to buy a controlling stake in a sports team?

41:06Felix Salmon: Infinite time. I would never, ever want a controlling stake in a sports team, I don't think.

41:12Emily Peck: If, all right, let me ask you another thing.

41:14Felix Salmon: Just get box seats.

41:15Emily Peck: If you were to buy a controlling stake in a sports team, what would the sport be?

41:19Felix Salmon: Football.

41:19Emily Peck: American football, like NFL?

41:21Felix Salmon: Yeah, because it's the most fun. It has the least games. And it's most popular, most revenue generating, etc. Like you could make money probably. If you own a controlling stake in like a baseball team, do you feel pressure to go to all the games? It's like over 100 games. So football is more, you know, tight.

41:39Emily Peck: Elizabeth, what's your number?

41:40Elizabeth Spiers: My number is 229, and that's dollars and 95 cents. And that's how much you can now or soon pay for an Izzy Miyake iPhone pocket. And this is a collaboration between Izzy Miyake and Apple that was started. It sort of came up when Steve Jobs and Izzy Miyake met and decided that they wanted to do something together. And it has never happened until now.

42:02Emily Peck: And both of those men are now dead, I think.

42:05Elizabeth Spiers: Yes, yes. What an iPhone pocket is, is that it's like a sling just for your iPhone, which I feel like those things already exist kind of, but it's sort of like the pointless in between your back pocket for your phone and an actual purse. It's just a pocket for your phone.

42:22Felix Salmon: It's like those Lululemon bags? Sort of, yeah.

42:25Emily Peck: I see quite a lot of women in particular with their iPhones on over-the-shoulder straps. that's, yeah, because your purse might be too small to hold your phone. You don't want to just throw it in the bottom of your tote bags. I'm down with this.

42:42Felix Salmon: I'm okay with it. Because if you put it in your pocket, it could fall out.

42:44Emily Peck: Yeah, and also like a lot of, you know, tight jeans. They don't really have the kind of pockets that an iPhone fits comfortably into.

42:53Felix Salmon: It seems like a lot of money, though. I feel like you get one for less money.

42:56Emily Peck: You know, what happens if you're wearing a dress without pockets? They do exist still.

43:00Felix Salmon: I don't know, Felix. What happens if you're wearing a dress without pockets?

43:03Emily Peck: You need an Asimiyaki iPhone holder. Oh. Well, let us know when you get one. Report back. All of my dresses have pockets, Liz, but I insist on that.

43:13Felix Salmon: I think all items of clothing for women should have pockets. All dresses, all pants, all skirts. Like, this is gender bias at its rawest, purest form is the lack of pockets in women's clothes. We could have a whole episode on that. Or fake pockets, which are doubly insulting. Fake pockets. What are you doing? What are you doing with fake pockets?

43:33Emily Peck: I will say that I have purchased men's suits that have fake pockets. What? What? That's a thing, too.

43:42Felix Salmon: I'm surprised that you would do that, Felix. I didn't realize. You were faked out.

43:46Emily Peck: I was unfairly duped. I think that's it. If you have thoughts on pockets, send them to us, slatemoneyatslate.com. Otherwise, thanks for listening. Thanks to Jessamyn Molly and Shana Roth for producing. And thanks for being a Sleep Plus member. If you're a Sleep Plus member, we have a Sleep Plus this week, as every week. Stay tuned for that.

44:09Felix Salmon: Tell them what's about.

44:10Emily Peck: What's it about, Emily? You don't remember.

44:13Felix Salmon: It's about the Jeffrey Epstein email cache, but it's not what you think. It's about, like, a different angle on it that you maybe haven't heard before.

44:21Emily Peck: We have a whole new angle on Jeffrey Epstein's emails, which you will only find out about if you're a Slate Plus member. Otherwise, we'll be back next week with more Slate money.