#271 Chris Hill’s 3 Stocks to Buy Now and Hold Forever

0:00Clearly, there are some people who think the run is over or about to be over because I don't know if you've noticed, but shares of Berkshire Hathaway are down 12 % since the beginning of May when Warren Buffett announced that he was going to step down at the end of the year. and I knew this was coming and now seriously considering possibly adding a bit more. I think the thesis that Greg Abel and the investing team that's in place at Berkshire Hathaway is going to significantly underperform what Warren Buffett has done in his tenure, I just think that's wrong.

0:45Emmet:I'd like to open this week's show with three numbers from useprofit.com. The first number is 145 % and that's the performance of profit over the last five years which means that had you followed our system your portfolio would have way more than doubled. It would be up almost 2.5 fold in five short years. The second number is 402%. That is the performance of profit over the last 10 years, which means that your folio would have grown five fold since 2015, which is like yesterday. And the final number I want to give you is 1 ,468%, which means your folio would have been a 16 bagger had you followed profit.

1:38Emmet:Coincidentally the folio is 16 years old so had you followed profit for 16 years your folio would be up 16 fold. Well I'm delighted to say there's nothing like it out there. We have three free months at useprofit.com backslash mws offer my Wall Street offer. So use profit.com backslash MWS offer to get a quarter of a year completely free of charge. On with the show. Hello everyone and welcome back to Stock Club. For over a decade Chris Hill hosted Motley Fool, the Motley Fool Money podcast which helped millions of investors make sense of the markets with his clarity and his wit and his insight.

2:26Emmet:Some of you may have met Chris in 2024 and indeed 2023 when he hosted Horizon Live here in Dublin. Well, today, Chris is the creator and host of Money Unplugged, which is a new show that cuts through noise to deliver honest, independent, and fun takes on a subject that shapes all of our lives. So I asked Chris to join us here. Chris, I'm delighted to welcome you back to Stock Club. How have you been? I'm well. Thank you for such a lovely introduction. Chris, I had the honor of being a guest on your show. And afterwards, I listened through all the former. I listened to half the episodes before I appeared and the rest of them after I appeared on your show.

3:10Emmet:And it really is a wonderful, unique idea on the very subject that concerns every one of Stock Club's listeners. So can you tell me, how did you come up with the idea for Money Unplugged, specifically money? So money is obviously something that we all need. and it's one of those rare topics that we all have to care about, whether we're interested in it or not. And something I've gotten more interested in as I've gotten older is our individual relationship with money. Because obviously, as investors, we have access to more information than we've ever had before, which is wonderful. It can also be a little overwhelming if you're not careful with how you manage the flow of information with your investments.

3:56But at the core of it, Emmett, every one of us is learning about money when we're young. We're learning how to deal with it as we get a little bit older. And then our lives become more complicated. Maybe we get married. Maybe we start a family, all that sort of thing. And we start thinking about retirement. And so I thought it would be both interesting and fun, and for the audience, possibly instructive. to talk with people about their individual relationship with money, what it was like growing up, how it changed as they got older, really how they feel about it. And I've been very fortunate in that you and the other people I've had on the show are quite candid about how they feel about money.

4:46And it's not always positive, as you know. I think any investor who's ever bought a stock and watched it go down knows the feeling. That's at least one type of negative feeling around money. But it's really something I've just gotten more interested in over time. And to be clear, some of the people I've asked to come on the show have very politely told me, no, I don't want to do that because they don't want to talk about their relationship with money. And I completely respect that. It's very personal for all of us. But for those like you and others who have come on the show, it's been a series of revealing and fun conversations.

5:25Emmet:Well, as you said, like you ask your guests about money in the earliest stages of their lives, money growing up. On that then, how much do early experiences actually influence the way we think about money, we engage with money, whether it makes it something we hold so private, we're unwilling to discuss it or something so public, we're willing to flaunt it. Tell us about those early experiences from what you've deduced in the show. So I've done about 25 interviews so far. And across those interviews, a couple of trends have emerged when it comes to this topic in particular. A lot of people grew up in homes where money wasn't really discussed.

6:08It's rare that I talk to someone and they say, oh yeah, we did talk about money a lot. We did talk about that. My parents, for many of us, it's a topic that is just not, it's like religion and politics. No, we don't, in polite society, we don't discuss that, Emmett, that sort of thing. So I think that's part of it. I think a lot of us are slightly hindered by the fact that it's not openly discussed when we're younger. I think everyone I've spoken with is affected in some way by what they pick up about money. Whether money is discussed or not openly, they certainly pick up because children are observant and they can see how their parents are talking about money amongst themselves.

6:57themselves, what the mood in the house is like. I'm thinking right now about one of the first episodes is with Dan Pink, a bestselling author, brilliant guy, very curious about the world. And Dan compared the mood in his house when it came to money. He compared it to weather. He said it was like having this ever-present drizzle hanging over the house because money was tight when he was a kid. And that just sort of pervaded the mood in the house. And Dan went on to talk about how that affected him as an adult. He's not surprisingly, he's pretty conservative with money with his investments and his approach to it.

7:40So everyone is affected in some way, some more than others, but nobody is immune from what money is like in their house when they're a child.

7:54Emmet:And then there's a dotted line, I think, from childhood that runs through your schooling, maybe in your high school years, your folks probably take most of the heavy lifting. And indeed, when you go to college, if you're fortunate, and then I think most people will figure, I need a job to do the stuff I need to do. But then that dotted line makes its way into a significant partnership, whether that's a lifetime partner or marriage. So what have you learned about your guests when it comes to money and marriage? Just like money is important for every one of us, it is one of the biggest issues in a marriage.

8:33Emmett, you and I have both been married to amazing women.

8:39Emmet:And still are, I believe, unless something happened at Jerusalem. Still are. I don't know. I'll check back. Unless something happened here this morning that I wasn't told. Yeah, it's one of the biggest issues in marriage. And yet, based on the conversations I've had with people, it's not really discussed all that openly. There are some exceptions. A couple of people have told me, you know, when I asked, you know, to what extent did you talk with your spouse about money before getting married? Malcolm Etheridge, who's a wonderful and brilliant financial planner here in the Washington DC area, told me, he said, it came up on the first date.

9:15She brought it up on the first date. And so I was happy to talk about it because this is what I do for a living. That is the exception to the rule for most people I've spoken with. Money is not really talked about, but again, similar to when we're children, the mood is picked up. The values are discerned. And I think this is something you and I talked a little bit about, Emmett, when you came on the show, that you can get a sense, you know, if you're dating someone, you go out to dinner, you get a sense of how they treat the staff. You also get a sense of how they value money, what they spend their money on, the way that they talk about money.

9:57And so I've sort of come to the conclusion where we probably don't talk about money as openly and directly with our significant others before we get married or enter into some type of partnership as much as we should. But I think that's okay. It seems like for the most part, as long as you are getting a sense of how the other person values money, then once you, you know, move in together, you start paying bills together. Yes, there are some tactical decisions that need to be made about setting up bank accounts and all that sort of thing. Linda Rotenberg is the co-founder of Endeavor, this global entrepreneurship organization, told me this great thing that she was very clear with her daughters who are both in college.

10:51She was very clear that when they get to the point where they get serious with someone, she's a big advocate of what she calls yours, mine, and ours bank accounts. Because when she got married, she didn't want to have to look over her shoulder for every single purchase she was making. And I love that idea. I'm a big fan of that idea.

11:15Emmet:What's yours is mine and what's mine is me own. Yeah, exactly. It's very true that it's kind of that old expression, how you do anything is how you do everything. And when you're dating somebody, there's a couple of signals that really just display your entire attitude to money. You find someone might be hyper generous, generous to a fault. And then someone who, you know, there's a padlock under a wallet and the wallet's hidden. You can kind of see this. So during your show, you usually have a speed round where you ask people about the last thing they splurged on. And I thought that was a great question because I had to struggle with that because I wouldn't say I'm a splurger.

11:57Emmet:but definitely it was a provoking thought provoking question. Have you any favorite answers from the 25 odd shows you've done so far? I have a couple. But before I share those, I do want to just spend a minute talking about splurging because this is something that hasn't really come up on the show, but it's something I've been thinking about on my own for a while, which is I think the agreed upon definition of splurging inherently involves a large amount of money. And I'm not saying that's an incorrect definition. But when I think about splurging, I find that I really lean into the urge part of it.

12:41And it's less about the amount of money. And it's more about the unplanned expenditure of money. I've had experiences where I have splurged on a breakfast sandwich because I'm just, you know, walking in my town. I go into a shop to get a cup of coffee and that's my intention, but everything looks and smells so good that I think, oh, all right, I'm just going to splurge on a breakfast sandwich, that sort of thing. So I do think splurging is also important. It is a little bit of a release valve for us. And every once in a while, we need to treat ourselves just like every once in a while, we need to go on a holiday.

13:22We need to take a little break from work. Every once in a while, treat yourself, spend a little bit of money. Some of the people who share their splurges tell me about things that cost thousands of dollars, if not tens of thousands of dollars. I will say, Emmett, your splurge, when you talked about splurging on something from the estate of Freddie Mercury. I got a bunch of text messages from family members and friends of mine who listened to the show and their delight at your splurge. They were like, oh, that was just brilliant that he did that. And a little bit of jealousy as well. But one of my favorites, I'll go back to Dan Pink, the episode with Dan Pink where Dan pulled out his phone.

14:19I did remind him that it was an audio only podcast and no one could see it. But he pulled out his phone to show me that he was expecting a delivery that day from a$28 purchase that he made on eBay that he was just utterly thrilled by. He was buying a commemorative popcorn bucket from one of the professional hockey teams in America, the Las Vegas Golden Knights. And the popcorn bucket was shaped like a Zamboni, which is the machine that sort of smooths out the ice between periods. And he was over the moon about it.

15:00Emmet:So is he a collector of popcorn buckets or a super fan of the team? It was the popcorn bucket because, excuse me, I did ask him once we were done, I should have captured this on audio. I did ask him once we were done, I said, why didn't you buy the commemorative popcorn bucket of the local hockey team, the Washington Capitals? Because I know he's a fan. And he said, they don't make one. It's ridiculous. I would have, but they don't make one. He was outraged that the local team didn't hit upon it. So again, splurging can just involve a few bucks and bring utter delight. And so that's probably my favorite so far.

15:44Emmet:But it's probably a function of how tightly you manage your budget. So where you, I know it's a throwaway example, but if you go into a breakfast place for coffee and walk out with 20 bucks lighter, you're right. It's not quite a splurge. But if one is inclined to manage their finances to the dollar a day, that's a splurge. prayer to the next person it's like i didn't even notice that i do that three four five times a day so it's a it's so interesting to hear that dan regarded a 28 or whatever was popcorn bucket as a splurge and it's quite telling about his uh his view of the subject of money and expenditure you're absolutely right that uh the greater your wealth the easier it is to splurge on things particularly things that don't cost a lot of money.

16:31I think part of it in Dan's case was the effort involved. He didn't just want to stop and stumble upon this. He went looking for this and he found it and he was thrilled.

16:42Emmet:So I suppose splurging brings regret for some people. They may be around the year 2000, a whole bunch of people bought flat screen TVs a little too early and dropped 4 ,000 euro or dollars on a TV that just wasn't there yet. And I'm sure there were a lot of people who looked at cars in their driveway in Ireland during the Celtic Tiger and went, I should not have bought that. So you've asked people about purchases that they regret. Did any stand out in your mind as something you could actually almost hear in your guest's voice that this was a mistake that they really utterly regretted from the minute they said sold or bought?

17:19There actually have been a couple of people who talked specifically about cars and buying luxury cars and thinking, oh, I'm going to treat myself and I really want this. And it becomes more trouble than it's worth. And pretty soon they get rid of that car.

17:38But I think that making regrettable purchases is unavoidable. If you have money, you're going to spend it and things just aren't going to work out. As we've talked about before, Emmett, it's the same thing with stock investments. We all buy stocks with the bull case in mind, and it doesn't always work out when it goes down. So it's the old saying, when you don't get what you want, you get experience. So I do think it's, I've seen it in my guests' eyes when I talk with them that they make regrettable purchases and they learn from them. One that stands out is Joe Mager, who was an investor at The Motley Fool for a long time and is now the founder and managing partner of a venture capital firm, Seaplane Ventures in Austin, Texas.

18:29And he talked about going on vacation with his wife and he had just gotten a bonus at work. so he was feeling a bit flush and they went into some shop and he bought a rock and it's this fancy rock and it was an inbound buy and he got it home and pretty quickly realized i paid way too much money for this rock and and it's now something that he sees in his house and you know because it just like I'm sure with the Freddie Mercury estate purchase, when you see it, you smile. You feel that warmth inside you. When Joe sees this rock, he just shakes his head and thinks, I paid too much money for that damn rock.

19:19Sounds loathing. Yeah, I have a couple of those things in my house as well. One is in my closet where I open my closet and I see this thing just in my closet. I thought, oh God, why did I spend that money? God, that was - I love that. I mean, he - Get rid of that.

19:33Emmet:Was it one of those fancy rocks that are cut in half and it shows all the crystal inside so it's something nice you can put on the table and tell people about? No, not really. Because I said, well, is it at least a conversation piece that it's out? And when people come over to the house, he said, no, it's just kind of off in a corner. Now, that's wild. Now, that to me, that's a perfect example. Because when you touched on purchases that people regret and talk about stock investing, for me, that's a different category. it sits in a part of your mind where you acknowledge it's not a material object designed to bring you joy and i think anyone who buys a fancy car as a status symbol is ultimately going to regret it whereas those who love cars like my best friend philip he bought a fast one he bought a classic one he bought a green one he bought one when i lit he bought like all these different cars and every time he's excited um and but if i made those purchases as much as i appreciate how lovely each of those cars are, I would regret it immediately because I'm not a car guy.

20:33Emmet:I mean, I want a car that works, but you got to love what it is that you've bought from the outset. So Joe should have arrived at that shop looking for the perfect rock. I'm here for a rock. Do you have any? Well, sir, you've come to the right place. What a coincidence, sir. Step right in. No, you're absolutely right. And I think you touched on something which is so important when it comes to both investing and spending money. And with investing, it's just knowing your circle of competence. It took me a little while to figure out that for me as an investor, I need to stick to investing in companies that I understand how the business works, because I'm just going to sleep better at night, whether the investment does well or not.

21:21And that took me a while to figure out. And I I think with spending money, it's not so much, well, should I buy a fancy car because society tells me, well, that's what people who are flush do with their money? Or do I actually like fancy cars? So learning to spend money on the things that actually matter to us, actually bring us pleasure, that we'll appreciate, whether our friends can appreciate them or not.

21:48Emmet:For sure. So that's a perfect segue into a question I almost always ask our guests, which is what are your three favorite investments to buy now today end of July 2025 and hold forever that notional time which doesn't exist because we're finite creatures but what are your three favorite things now that could be a casket of wine it could be whatever what are your three favorite investments right now so I am fortunate in many ways one of which is I've been investing for long enough that I have enough stocks in my portfolio that I would feel comfortable buying shares, more shares of today and just holding them forever.

22:34But in thinking about your question, Emmett, I decided to take the route of finding investments of different sizes, just the overall worth of the business. And I inadvertently stumbled upon three companies that create a mnemonic device for your audience. So these are companies that are literally A, B, and C. So the A is Axon Enterprise. The ticker is A-X-O-N. It's a company that's about$58 billion in value. For those unfamiliar, this is the company that used to be called Taser. They specialize in non-lethal weapons and law enforcement systems. And it's one of those businesses that I want to see succeed, not just because I'm a shareholder, but because I think it's a business that can provide a public safety, again, with non-lethal technology.

23:42and it's 58 billion dollars in market cap so it's it's not the biggest company in the world it still has room to grow and it's one I've owned shares of for a number of years and will continue

23:56Emmet:to same and I also am a shareholder and interestingly fast fact I interviewed the founder of taser and then exxon I mean say exxon here on the show many moons ago and fast fact interesting fun fact taser is named after him the tom a smith electric rifle t-a-s-e-r so i interviewed tom smith on the show and that's how taser got its name i did not know that's how taser got its name so thank you for that nugget so that's a i could not agree more and it it very possibly would be one of my desert island stocks as well and as a share i bought in horizon and is doing very well it's up two or threefold so tell me what's your b b is berkshire hathaway which is sitting pretty at a market cap of one trillion dollars however shares are not bad not bad it's been a good run um but clearly there are some people who think the run is is over uh or about to be over because i don't know if you've noticed but shares of berkshire hathaway are down 12 percent since the beginning of may when warren buffett announced that he was going to step down at the end of the year and i knew this was coming and emmet i think i can count on one hand the number of significant predictions about stocks that that i've been right about but i've been saying for a couple of years now buffett's going to announce he's leaving at some point and when that happens, the stock is going to drop and when it drops, I'm going to buy more and so the Monday after the Berkshire Hathaway annual meeting, shares fell 5 % and I added a bit to my portfolio and I am now seriously considering possibly adding a bit more.

25:52I think the thesis that Greg Abel and the investing team that's in place at Berkshire Hathaway is going to significantly underperform what Warren Buffett has done in his tenure, I just think that's wrong. I understand the people who say, well, look, Warren Buffett gets the quote unquote, the Warren Buffett discount when he's making deals. I suppose that's true to some extent. But I think that the amount of cash that Berkshire Hathaway has on the balance sheet at the moment will enable Greg Abel and his team to get some deals of their own if they want. I also think that Buffett is pretty dogmatic when it comes to valuation and acquisitions.

26:36And I believe in Warren Buffett's mind, there is no difference between, you know, if they're looking at an acquisition and he has a price in mind and the seller wants 2 % more, I think in Buffett's mind, he sees no difference between they want 2 % more than I'm willing to pay versus they want 50 % more. Oh, entirely.

27:02Emmet:He said that repeatedly. There's the deal. Take it or leave it. Yeah. And I think that, again, because of the cash they have in the balance sheet, my hunch is that Greg Abel is going to be less dogmatic when it comes to acquisition. So anyway, I think Berkshire Hathaway is just set up to continue to run in a stock appreciating way for many years to come. Even though it's now a name known to everybody who listens to this show and anyone who's invested in the stock market, it's funny to think that even in the 90s, they're virtually unheard of. Like it was kind of Berkshire who now? It was just another fund.