Episode 265: 5% HISA... for the Long-run? (Plus Stoicism with Michael Tremblay)

22:38So we can't just look at the 5 % cash yield and say that looks pretty good compared to stocks. It's like, well, that's a judgment that the risk premium on stocks has changed. Because we don't care as much about the absolute return. You're still giving up expected return. And then the reason that's an issue is that the consistently lower expected return on cash makes it much harder to meet your long-term financial goals. You've got to save more or spend less in the future to compensate for that. But then I think even beyond that, if we just look at, so okay, your expected returns are lower, you're not hedged against falling expected returns, those are both not great.

23:14Then if we go and look empirically, and this is from the Scott Cederberg stuff, investors have historically been much more likely to lose purchasing power. So now we're not just talking about what your expected returns were lower, you're actually losing purchasing power, holding cash empirically, well, at least in their bootstrap samples using historical data. Cederberg finds and his co-authors in a sample of 38 developed markets from 1890 to 2019, their 30-year bootstrap estimates of real loss probabilities for government bills is 37 % compared to 27 % for intermediate bonds, 13 % for domestic stocks, and 4 % for international stocks.

23:53How compelling. The main point there is holding cash as a long-term investor is not so great. It's actually interesting when you look in their data, it's not just the probability of loss that's been greater in cash or in bills, but also the magnitude. The worst case outcomes for bills has been worse than the worst case outcome for stocks at long horizons. At short horizons, that's not true. Cash does its job, if we can say that at short horizons, it has been safer than stocks. But when you extend that time horizon longer and longer, in real terms, cash has been risky, real risky. Real risky. Real risky in real terms.

24:33Now, one of the things that I've also heard from talking to people is that with cash rates where they are right now, well, I'll just sit in cash until the market drops and then I'll get back in. Now, of course, we have looked at the idea of buying the dip, sitting on cash until a market decline. And in our work on this, we looked at market drops of 10 % and 20%. So waiting, sitting in cash. So it's like on day zero, I guess you're making the decision of should I invest the lump sum in cash or should I wait? And in the buy the dip strategies. We have the lump sum where they just say, let's invest today.

25:11Then we have the buy the dip strategies where in one case, you wait for a 10 % drop. Then the other case, you wait for a 20 % drop, and then you invest a lump sum. We found that buying the dip trails a lump sum most of the time and on average by a pretty significant margin. The 20 % buy the dip strategy was worse than the 10%. That's, I think, just consistent with stocks and bonds having higher expected returns in cash, which just makes sense. To finish on that, cash yields are high today, which I think is enticing. We know empirically that tends to be the case, enticing long-term investors to basically reduce their risky share of assets, hold less risky assets.

25:56Again, anecdotally, I've had these conversations multiple times since rates went up. I want to do a whole episode on this, but the other funny thing about expected returns and return expectations. I'm going to do an episode on that. Expected returns and return expectations. People's return expectations, which is distinct from the financial concept of a discount rate and expected return as a discount rate. The returns that people subjectively expect, I think, and there's research on this too, but also just anecdotally, people's return expectations are informed by recent history. The market kind of sucked.

26:34I mean, it hasn't been too bad this year, but say that the markets kind of sucked last year. And so people think markets are going to suck next year. They extrapolate from recent experiences. We know people do that. And again, we know that empirically. We also know it anecdotally. So people extrapolate our recent experience. When the market kind of sucked last year, return expectations go down. So right now people are looking at a 5 % cash yield. Rates just went up. Asset prices went down. So people see that and think, geez, my return expectations are kind of bad right now. But the funny thing is, return expectations will tend to be, based on the scenario you just described, will tend to be inversely related to expected returns.

27:15Correct. It's kind of funny. There's a really good paper on exactly that. They have a whole bunch of survey-based return expectations, and they compare that to expected returns, and they do find an inverse relationship anyway. There's a whole future. But anecdotally, that's where we live. 100%. Markets sucked last year, so people expect it to suck next year, but expected returns, that's when they're higher, which is hard. You can see why investors trail whatever their asset class are investing in. Getting market returns is not easy, simple but not easy. People might be enticed to invest in these 5 % yields because their return expectations are low for stocks and bonds, even if expected returns are higher.

27:57One of the big problems though is that expected return on cash is unpredictable. The current yield on cash is not a good predictor of the long-term return on cash. If expected returns decline while you're holding cash, you are not hedged against that decline at all. The opposite is also true. If you could hold cash waiting for interest rates to increase and asset prices to fall, then that would be a winning move, but we already talked about buying the dip, not so easy to get right. Cash also has lower expected returns than stocks and bonds in all environments, even as rates go up, the risk premium seems to be pretty persistent.

28:31The real risk premium in the Dimson-Marshton data and cash is much more likely to lose purchasing power in the long run, which makes it much harder to meet your long-term financial goals. Holding cash, it can feel good. I get that. We've seen that in Adriana Robertson and James Choi's research that people just want to hold cash and even more so at 5%. That's the whole reaching for yield idea or the inverse of that. But I think long-term investors are much likely to be better off in stocks and bonds in the long run than holding cash. Love it. That's it? That is it. Beautiful. That's great. Very timely too.

29:09Okay. Shall we do a quick review of a past episode? This is where we give new listeners a chance to hear about some of our favorite past episodes and gives you a bit of guidance on which ones to go back and listen to. If you're going to go back through with the 264 episodes plus your crypto series. That's a lot if you want to dig in. So our goal is to make it a little bit easier. And David Booth is here on episode 131, which was certainly a highlight for me. I know for us, David's a super important figure in the index fund revolution, had an unbelievable career, and it was a pretty cool conversation.

29:44So with that, I'll see if I can do a quick summary in one minute. So this podcast is about sensible investing and financial decision-making. At the root of each of these is science. So our goal is to bring rational findings so you can implement better solutions and ultimately have a better life. And a business leader that absolutely epitomizes this is David Booth, who was our guest on episode 131 back at the beginning of 2021. David was on track for a career in academia and he studied under Professor Fama, but decided implementing these ideas he was learning into real world solutions was far more important to him.

30:21So he then joined Wells Fargo where he was part of launching, yes, the world's first index portfolio in 1971, five years before Vanguard did it. Then in 1981, he co-founded Dimensional to offer institutional investors access to the benefits, diversifying into small cap stocks. And then in the nineties, they opened up their portfolios to financial advisors to deal with individual investors and that's what led us to discovering Dimensional. David shared the story of how they grew up to become what they are now, an$800 billion success story. He also tells how we got other giants like FOM, a French and McQuown to become involved in this mission.

30:59David has been a big part of the index fund revolution and this conversation in my opinion is a must listen to learn about how it all happened. That was David Booth back on episode 131. A little over a minute, but worth it. Well worth it. Yeah. I think the world of David had interactions with him for over 20 years and just solid, great person. I agree with that assessment. So for the book review this week, we do something different. This is really fun, actually, where you get interaction with a listener who has an idea and shares this idea and links it to the book reading. So a longtime listener, Michael Trombley reached out.

31:35He's an expert in stoicism and offered to join us to talk about stoicism and how it relates to the rational reminder. He knew we did book segments, so he proposed the book. The book is the handbook of Epictetus, which is available widely, PDFs online. I got it on my Kindle, although the way it comes down on the Kindle, I guess it's a PDF on Kindle, so you can't actually take notes from it, but it is available widely. It's not expensive in the PDF. There's many PDFs for free online. Michael writes about the benefits of Stoicism, which is an ancient philosophy focused on using rational decision-making to manage your emotions and live well.

32:14Michael has a PhD in philosophy from Queens University, where his dissertation focused on strategies for self-improvement in Stoicism. He's a co-founder of the Stoic Meditation app and co-host of the Stoic Conversations podcast, which both focus on helping people live happier, better lives through Stoicism. I've checked out his podcast. They're great. him and his co-hosts are really good. It's excellent. He's also a management consultant working with leaders in the private, public, and community sectors on issues that have a substantial positive influence on people's lives. He recommended, like I said, the Epictetus Handbook.

32:50It's short. It's excellent. It's interesting. It's a great read. Instead of just me giving a review of the book, we thought it'd be fun to welcome Michael on to talk about it. Let's go to our conversation with Michael Tromboli, who joins us from Toronto. So Michael Trombley, welcome to the Rational Reminder podcast. Yeah, thanks for having me. It's great to have you. Thanks for suggesting this segment. I think this is a really interesting material and yet a good format idea. So thanks for that. I thought it was very applicable to listeners. I think it would be helpful for those that are interested in investing, interested in the content you're putting out.

33:23So glad to talk about it. That's awesome. So off the top, what is Stoicism and who is Epictetus? So Stoicism is an ancient Greek philosophy. I'm going to assume people maybe don't nerd out on philosophy the same way I do. But ancient Greek philosophy, this is like 300 BC in Athens. There's a lot of different schools of philosophy back there. And they really looked at philosophy as a way of life. So you think of this as something before Christianity, it was a way of establishing your values, a way of thinking about the right way to live. Stoicism is one of those schools, again, around 300 BC it originated.

33:58And it was really popular all the way into the Roman Empire. So for around 500 years until Christianity took over, as I would say, the major cultural and religious approach to life. And Epictetus is a Stoic. He was really interesting because he was actually born as a slave. So he was born as a Roman slave, lived in slavery for the first 30 or so however many years of his life, studied Stoicism while he was a slave, had that opportunity. And then he gained his freedom. And when he gained his freedom, he left Rome and opened up a school of Stoic philosophy and taught there. And so one of the major Stoic texts we have is actually notes from his lectures.

34:37So a student writing down what he was saying to students and the debates he had in classrooms. And that gave us a perspective into Stoic philosophy. What would you say is the key idea behind Stoicism? There's a couple different ways to think about Stoicism, but I would say the main idea is that what makes a good life, what makes when you're judging a person, you know, you funeral. So what makes a good life is that that person made good decisions with the situations they had. So it's a focus on the internal instead of the external. If you think about this in terms of we're judging a poker player, we say, well, the poker player is the person who plays the cards they're dealt the best of their capacity.

35:14If you think of an investor, and I'm going to try some investing metaphors, so feel free to change those around if you have a better one. But we're thinking about relative return instead of absolute return. So if somebody doubles their investment, That's a better investor than if Bill Gates makes a million dollars, but that happens to be a minuscule return. So stoicism is this real concept of what matters is your choices, your decisions, your character, these kind of responses to situations rather than external results. Because external results are all, they're muddied up by chance. So first of all, there's kind of a practical consideration about why you should focus on yourself.

35:53but then there's also just a kind of value claim that really what you should actually be focusing on is yourself because that actually is what matters at the end of the day. You mentioned investing. How can stoicism help everyday investors make more rational decisions? First of all, stoicism offers a set of tools. If people are hearing about stoicism for the first time, you might think of just the adjective to be a stoic. And it's like, well, where does that come from? Well, it comes from this idea that people who are good at focusing on themselves, people who are good at focusing on the decisions they make rather than outcomes find themselves a lot less emotionally stressed, a lot less perturbed by the situations because they're always thinking, okay, well, what can I do now?

36:35How can I respond or react in this situation? There's this emotional aspect of stoicism, this kind of cool-headedness. And that cool-headedness comes from adopting this growth mindset and adopting this focus on what's in your control. And so the first thing that I think investors can learn is just that kind of mindset shift. I mean, I think a lot of people are already doing it. I think that's something that you emphasize in your podcast and in your work more generally. But there's this focus on decision making as the core of good investing rather than results, rather than experimentation, rather than big risk.

37:11But thinking about given my values, given what I want out of the situation, what's the best decision I can make? And then there's actually a kind of a psychological strategy to staying in that mindset. And the Stoics offer a bunch of tools for doing that. I would say the second thing is that the Stoics argue that this is not just the way you should approach investing. This is the way you should approach the entirety of your life. So if somebody is very not Stoic or very not rational in their decision making outside of investing, then there can become this big jump. I have to treat my portfolio this way, but I don't treat the rest of my life this way.

37:44And I think the Stoic argument would be, look, this is the right way to approach all things with this emphasis on clear evidence-based decision-making. And I would say the third way is that the Stoics offer a really clear conceptual model with what we should care about going wrong. And this is something that I use in my own life. And Ben, I think you either said it in a YouTube video or you said it on a podcast episode, and it's this idea of what determines whether a decision was good or not is the decision itself, not the outcome of that. And so it's the same kind of thing where if when something has gone wrong, you're looking to the external circumstance, you're making yourself vulnerable to chance and vulnerable to these things outside of your control.

38:25Whereas Stozen says, look, something's only gone wrong when you made a bad decision. That's the only time something's gone wrong because that's the part that we're evaluating here. That's the part that we should care about is those decisions that you make. So in those ways, it's kind of a defensive philosophy. philosophy is to say, look, if I can get through this situation without making a mistake, without jumping to a conclusion, telling myself a story that's not true, getting caught up in the hype or something, or getting too greedy, too fearful, if I can make it through this, whatever historical event, this timeline horizon, whatever it is, without making those mistakes, then I've done pretty good, because that's what I should be looking at and evaluating.

39:04So I think that focus on mistakes as coming down to the decisions you make. I think that defensive approach to living is also a really helpful approach, I would say, to investing and also, I should say, wealth management more generally. You mentioned that the Stoics have tools that people can use. Can you talk about some of those tools? The first main tool, I would say, is the dichotomy of control. The dichotomy of control is just a mental model, which is to say, look, there's some things that are up to you, some things that are not up to you. This is a core division of all things, right? Anything you look at, it's either up to you or it's not.

39:40That's a descriptive claim. And then there's this idea that we should then focus on the things that are up to us. So there's this kind of value claim that given that there's these two types of things, you should focus on the things up to you. The dichotomy of control then as a tool, it's almost like a mantra. It's something you repeat to yourself or something you keep in mind. So in any situation you think, well, okay, let me just consider the dichotomy of control right now. Let me just think, is this a thing that's up to me or it's not up to me? If it's not up to me, maybe I shouldn't be getting so stressed about it.

40:09If it is up to me, I better make sure I do the right thing. I better make sure I put the work in, I make the correct decision. So there's that one tool, the dichotomy of control, really, really famous one. The second one, the Stoics have all these tools again for staying even keel through the kind of turmoil that comes in any investment decision or in life. The second is the premeditation of evil. And what is meant by that is this idea that bad things can happen. So if you think about those bad things beforehand, when they do happen, it's less of a surprise. And so if you think of this in terms of investing, I might think there's going to be a natural market downturn.

40:43These are going to happen eventually. There's going to be black swan events that might take out a large chunk of your portfolio. And if you've never considered that possibility, you haven't actually emotionally internalized that. The first time it happens, it's going to really freak you out and it might lead you to doing something silly. So the second tool is just premeditate. So actually just think about that, anticipate the kind of things that can happen. And it's not to be pessimistic or negative. It's to be emotionally prepared for these things when they do come about. So that's the second tool.

41:13The third tool that the Stoics use, I think it's really cool because this is 2000 years ago, they're writing this still super useful and applicable, is what we call the view from above. And that's the idea that when you get caught in a situation, actually pull yourself out of yourself. and imagine yourself looking down literally from the sky on the situation to give yourself context and perspective. And that's a great tool to use when you're feeling very stressed about a specific situation. But you can also do that. You can take a view from above spatially. You can zoom out and look down from the sky.

41:46But you can also do it over time. And you can take the view from above across a long time horizon. And so when you do that, again, thinking of the kind of variations and investments in your portfolio. Well, something that is stressful on a day-to-day, if you zoom out and you think about it in terms of a year, five years, 10 years until you retire, that's not actually something that deserves the kind of emotional stress you're giving it in the moment. If you zoom out, it's not really a big deal that there's day-to-day, week-to-week, month-to-month fluctuations. So again, those three, dichotomy of control, something's up to you, some not.

42:20Premeditation of evil, which is just this consider that bad things happen, accept those, internalize them, think about them so you're ready when they do. And then view from above, which is if you're stressed in the moment, you feel like you might be making a bad decision because of it, zoom out and see if that changes the kind of criteria for your decision. It's really interesting. And I'm not an expert in this at all, but a lot of it sounds like cognitive behavioral therapy. So cognitive behavioral therapy is explicitly stoic. The founder of cognitive behavioral therapy took stoicism and said, look, I want to make this into a contemporary psychological method.

42:52There you go. Cool. You touched on this already, but I want to make sure that we ask about it explicitly because I think this is one of the reasons that you got in touch and wanted to come on. Can you talk about what stoicism has in common with the rational reminder approach to investing? Yeah. And I mean, you correct me if I'm getting the rational reminder approach wrong. I'm a fan. This is my perspective. I would say first, one part about stoicism that I haven't introduced yet, because obviously there's a lot here, is the main stoic idea about how you should love. Okay, focus on yourself, live well.

43:23But what does it mean to live well? Well, they would say it means living in accordance with nature. And what they mean by nature is not the trees and the animals, but the facts of the universe. They say live in accordance with the facts. That's what it means to live well. So don't make up a story. Don't have an ego that's based on something that isn't true. Don't get caught up in lies that make you feel better. Just live in accordance with the facts the way they are. So I think first of all, the rational reminder approach to investing, I would say, is one that's evidence-based. There's a humility with that and there's an effort with that.

43:53The right approach to investing is one that is borne out by the facts. It's not driven by a bone to pick. It's not driven by some sort of position that you're worried about advocating. And that position, if you do have a position you're advocating, it's because it's borne out in the research and the literature and it will change if the literature changes or the research changes. So that's one thing is living in accordance with the facts. Marcus Aurelius, emperor of Rome, was a Stoic, has a great quote where he says, look, I would not be a Stoic if you can prove to me that it's wrong. I'm looking for the truth.

44:22I'm not looking to defend Stoicism. And I would say that's the thing is this idea in your investing and in your living accordance with the facts, then update how you live based on changes to the facts. Second thing that I would say is, I've already hit on this, but I would say that your approach to investing and Stoicism are both about maximizing what's up to you, that dichotomy of control, focusing on the parts that are up to you. So we're not going to evaluate success or failure by these absolute returns, as I talked about earlier, but on did you make good decisions with the money you had? Did you allocate it properly?

44:57Were you responsible in kind of emotionally difficult situations? And the third thing, which is one thing that I really like about your show, is stoicism, ancient Greek philosophy in general, and the rational reminder, you encourage introspection about your values, about your goals out of life. So when you're evaluating something, you have to evaluate it in relation to your goals, in relation to what you want at the end of it. And so this idea of, well, what do I want retirement to look like, both in my timeline and in the kind of the way I live? And do I want to have some money left over that I distribute to my children?

45:33Do I want to use it all up so that I can have kind of the life that I want? Do I want to donate some of it? you have to have these questions answered, what that good life looks like to you, and then you can invest appropriately. And so stoicism is also about evaluating what you think a good life looks like to you, evaluating what your values are, and understanding that you're not really able to have success or failure. You're not really able to evaluate those terms without being clear on your own values. But I think it would take that and extend that beyond just investing and extend it to the rest of your life.

46:05I want to touch on that part you mentioned about stuff being up to us. Can you explain more about the Stoic distinction between what is up to us and what is not up to us? This is something that people often get confused about. So for Stoicism, what is up to us is exclusively our minds. So exclusively the choices and decisions that we make. So they have this model of psychology, which I think there's some variation now, but it's borne out to a certain extent in modern psychology, where we receive an impression, or the world seems to us in some sort of way, we feel a certain way about something.

46:44And then there's before we commit or act on it, there's this pause, there's this gap. And so that space between, you know, impression, and then belief, action, choice, that's really where our freedom is. That's where our ability to improvise, determine ourselves, that's where that is. And that's the most important moment. Not only is that the most important moment, but that's ultimately the only thing that's up to us because the impression that we receive is not up to us. The consequences of my decisions aren't up to me. And then certainly things like my reputation, my body, my wealth or portfolio, these are not up to you at all in an absolute sense because there could be some sort of catastrophic event or something like this that could take this all away.

47:26So what's up to you is really that psychological process. And that's where they put our identity too. That's where they say that's who you are is that thing that can make decisions. That's really what matters. What does stoicism have to say about the role of emotions in investing? Yeah, it's a good question because when you think about a stoic, you think of somebody who's not emotional. But the stoic idea of emotions, the stoic theory of emotions is the idea that emotions are value judgments. So sometimes if you haven't thought about emotions a lot or haven't thought about this aspect, you can think of emotions as sometimes being these irrational things, these parts that kind of bubble up, the subconscious.

48:02And Stoicism was these proto-psychologists, the first to really point out, in a way that's been borne out in modern neuroscience, the results of judgments. If I think something good has happened, I feel happy. If I think something bad has happened, I feel sad. If I think something bad might happen, then I feel fearful. I feel afraid. So the Stoic goal for emotions is not to not have emotions, but it is to only have the emotions that come from true value judgments. So actually correct judgments about the world. You two might have better examples, but I think something like, my portfolio's dropped 2 % in one day and I think, wow, my life is ruined.

48:38This is terrible. This is the start of a huge market crash. I better withdraw everything. That's a fearful reaction that's not based in reality. That's not borne out by the facts of the situation. And so that's an unhelpful emotion. That's an incorrect emotion. And those are the kinds of emotions we're looking to eliminate. Likewise, if your portfolio goes up 2 % And you think, wow, this is amazing. I'm going to be able to retire way ahead of schedule if this keeps up for the next couple weeks. My problems are all over. That's also a positive emotion, but it's an unhelpful emotion and one that leads, again, to foolish decisions later on.

49:13So the stoic advice for emotions in investing is that, look, I don't want to be cold. Epictetus says this thing, we shouldn't be cold like a statue. But what we should be careful is that when we indulge in emotions, we want to make sure as much as possible that those are based on things that are true and that we really believe. And if we're making up stories, if we're making up stories about our investments, about our portfolio, what that means for our lives, those stories are going to lead to emotional reactions that are unhelpful, even if they're kind of maybe pleasant in the moment or even if they feel appropriate because everybody else is doing it.

49:48That's when you think about someone being stoic, I think in an investing context, I think of that person being kind of even keel through these variations because they're not attaching, they're just staying at that level of description, not at that level of storytelling. So, okay, the markets went up this much today. That's a description, but there's no story there. Okay, the markets went down this much today. That's a description, but there's no story. It's only when you have that story do you start feeling that kind of emotional variation, which ultimately, a lot of people have trouble even investing long-term because of that kind of turmoil.

50:20They'd rather stay in cash. They'd rather stay in something that's maybe less optimal. but higher security just because of the emotional fluctuations that come with the value fluctuations. So I think having that stoic approach, not only does it make you sleep better at night, but it will, I think, have better returns to help you achieve your goals. You already explained this, but there's so much cognitive behavioral therapy in there where it's like catastrophizing based on the 2 % down day. And then it's stepping back and asking, what are the facts? It's fascinating stuff. What does stoicism have to say about death and investing?

50:53This is one thing that I wanted to talk about because I think it's an important one. I talked about the premeditation of evils and things like that, but stoicism is about, as I said, living in accordance with the facts. So it's about accepting the facts of life. One of the facts of life is that we'll all die. The three of us, we're all going to die. But it's not a very fun fact. So it's not one that we always like to talk about. But because it's not fun, it can cause a kind of, I would say, mental blind spot. So then when you're doing your investing decisions, when you're doing your long-term planning, if you're long-term planning in terms of kind of your death as a blind spot, then either you're not comfortable talking about it or you don't have those conversations to the best of your ability because it makes you uncomfortable, then you're not planning optimally.

51:38And so the Stoics looked at death as not a thing to be avoided or not a thing to be ignored, but something that you want to do well. like everything else. You want to die well. So your question doesn't become, how can I avoid death? It becomes, well, when it's time to die, how can I die well? And when I think about that in terms of portfolio management, I'm hopefully still a long ways off. Maybe not. But when I think about that in terms of portfolio management, I think about that not as retirement. That's not the end goal. But the end goal is, well, when I pass away, in what state do I want my portfolio to be in?

52:13What do I want to have left over for other people? What do I want to have spent? And having that, incorporating that actually as part of my decision-making process, rather than having retirement as this end goal. Because I think sometimes you can have retirement as the end goal because it's a very nice goal. It's very like, wow, that's when it's beaches and sailing. And that sounds great. But instead of actually looking at the whole journey and each part of the journey, death included, I think is really important. And the Stoics have this phrase called memento mori, which is just Latin for remember that you will die.

52:42And it's something that underpins your decision-making process. Another part I should say to this also is actually the opposite end of this is you get people who maybe over-save because they think, well, you talk a lot about the 4 % rule or 3 % rule now and this idea of, well, after I retire, I'm going to live for another 40 years. I think of something like fire, for example. There's this almost assurance of like, I'm going to not enjoy my life now because then I'll get to enjoy it for that 50 years in retirement. and something about memento mori is just the idea of, well, that's not a hundred percent.

53:16That's not a certainty. And that's not to say don't commit to fire or don't not save for retirement, but just saying live accordance with the facts, which is the fact that you don't know, you can only have a certain degree of confidence. And it's not the funnest thing to talk about, but I think it's important and I think it's helpful. And the Stoics think that that memory of death permeates all of your decisions and helps them actually be better if you can figure out how to do that well. That's really interesting. So Michael, I have to ask you our typical final question. How do you define success in your life?

53:45I have defined success always as to love and to be loved. I define it as like good personal relationships with the people close to me. And I view work, study, anything else as the capacity to be better in those roles. So like as I gain skills, it puts me in a better position to support the other people that are close to me. So really that's what I would view success is being able to enjoy those relationships with other people effectively, I would say. Great answer. Michael, thanks for joining us. This has been great and thanks for reaching out and recommending the handbook of Epictetus. Yeah, thanks for having me.

54:21It's great. Thanks, Michael. That's pretty cool to have Michael on. Really cool and he's right. He got in touch because the principles of stoicism line up pretty nicely with a lot of stuff that we talk about on the podcast and hearing him go through that information, they do line up. As we said to him, even though this segment's after your part about investing in high-interest rates, he teed it up perfectly by saying, are you going to stick with the, how are you going to make the decision based on rational decision-making or the emotion of the time? You might find 5 % emotionally appealing, but you just demonstrated that it's perhaps not rational if you're a long-term investor.

54:58It was a perfect setup. I love when that happens, when topics line up like that. Yeah. And it actually happens more often than you think, purely accidentally. It makes it seem like we have a grand vision for each episode. Grand chaos. Last week, I had the ultimate week at the cottage. Unbelievable weather, seven solid days of perfect weather. Somehow the lake where we were west of Ottawa dodged all these storms that came through Ottawa. So we had a terrific week. And you know my old saying, if you can lean, you can clean, which is a line we used to use at the butcher shop I worked in as a kid.

55:30So I now change it to, if you can lean, you can learn. So I cranked out last week, eight books, if you can believe it. That's a lot. It's a little insane. It's a little crazy. Brings me up to 43 for the year. Just so many great books. It was so much fun just to hang out on the dock. Of course, the 23 and 23 challenge is still going on, which you can join at the website, our website, rationalreminder.ca. I do want to mention actually, because while you were on the dock reading books, I was also reading a book. I read Cass Sunstein's book to prepare the questions that we would ask him, which we've now done.

56:05I think this is a fine area to share it. You tweeted thanking him for coming on. And he quote tweeted you and said, this was probably the best and most probing interview I have ever had. All about decisions about decisions. Many thanks to Cameron Passmore on Rational Reminder. That was a cool interview. That's upcoming. Yeah, it's next week, actually. He was incredible. Many people recognize the name from Nudge. He co-authored with Richard Thaler. What a nice, brilliant communicator. How he communicates in such plain language, which was one of our hurdles we thought about because the book is fantastic.

56:44However, it is not an easy read. No, it's dense material. But the conversation was a very easy conversation. Well, I think I said this in the intro to that episode that as we're going through the book, it's like, this is dense stuff, but it's important stuff. If Cass can pull off making this interesting, it's going to be an incredible episode. And he sure did that anyway. So people I think will enjoy that coming up. Speaking of other guests coming up, we're going to keep doing having authors joins for the book reviews. I've lined up Matthew Dix, who wrote the book called Storyworthy, just a great book.

57:15So he's coming on. Brittany Hodak wrote a book called Superfans, which is a really cool marketing book. She's going to join us. And then we also have two friends of the podcast coming back, Preet Banerjee and Rob Carrick are going to be coming up in the next month or so, two separate episodes. And then you found academic Itzhak Ben David, who's joining us. That'll be a great episode. I mean, I think we're now booked up through the end of the year almost. We might have one spot left, but yeah, mostly booked. Mostly booked. Do you want to take a look at this first review we got. Giga Peck. I don't know what that means.

57:48It makes me feel like I should get back to bench pressing. Giga Peck from the United States says, finance explained to the track list of guests and topics is unbelievable. It is the pinnacle of financial education. A profound thank you to the hosts for the public service. Very nice. So I had a bunch of emails and beach outs on LinkedIn. We got an email from Simon, who's a financial advisor in Montreal saying, I've listened to your podcast for years now, almost since the beginning. And I chose to begin my practice and financial services in some ways, thanks to your work. Keep the work going. I love to listen to you, your everyday insights and guests while doing everyday stuff.

58:27Max from Germany on LinkedIn reached out to say, hi Cameron, just a quick thank you for the great content you and Ben keep producing. Since I started watching in 2019, you guys had a huge positive impact on my investment strategy, the way I give advice to my clients and on me as a person, the way you explain complex topics in easy to understand terms. It's just phenomenal. And the high quality conversations you have with guests on the podcast made me learn so much about many different aspects of life. You made me realize that I chose the right career path, the right employer, and what motivates me.

58:54Thank you. Best wishes from Germany. Keep up the outstanding work. Here's another interesting one. Harry from New Zealand reached out and wanted to thank us and connect with us. I'm a listener to the Rational Monitor podcast and a member of the online community. I'm wondering if you'd be willing to answer some questions I have around setting up my own independent wealth management business acting as a fiduciary. So he actually grabbed my Caldi link in my Twitter handle and set up a time. So we had a conversation earlier this week, just a great guy in New Zealand, really thoughtful questions. Young guy, but with people like that coming through the industry, if that represents what the industry will become, it's in a good spot, which is pretty cool.

59:31That is very cool. In the community, Ben, any updates? Yeah, it's worth mentioning that we do have CE credits, continuing education credits available for both FP Canada and Ciro, the Canadian Securities Regulator. We created a bunch of those courses. They've all been accredited. Fewer people than we had hoped have signed up to take these courses. So maybe this was just a bad idea and people don't want to take these C credit courses. I think it's a kind of a good idea and maybe just not enough Canadian financial advisors have found the product yet. They're really good courses. They're really nicely designed questions.

1:00:04And I think listening to those episodes and then doing the questions is probably a valuable learning exercise. Maybe people don't want that when they do their continuing education credits. Maybe they just want the quick, easy ones. But if you're listening anyways. Yeah. If you're listening anyways. Yeah. I don't know. Anyway, if you're a Canadian financial planner or registered with Ciro as an advisor and you need your CE credits because we're coming up to the end of the year, then we do have learn.rationalreminder.ca. We have a bunch of courses available. If more people sign up, we'll keep making courses.

1:00:35But as it sits now, with the amount of people that have signed up, we probably wouldn't keep making new courses. Coming up, we're going to Future Proof in Southern California, just over a month away, Ben, if you can believe it. I think we're going to meet a lot of advisors. I had Oliver reach out from the UK this morning, saw that we were on the agenda. So meet up with him at some point. And I think we'll meet up with a lot of other people. We're having a Canadian breakfast on September 11th down there. So if you want to join us, you can email info at rational reminder.ca. We're doing a live recording of an episode at Future Proof on Tuesday morning at 9 a.m.

1:01:12on the social audio experiment stage. Hal Hirschfield, our good friend, will be our special guest, which will be very cool. We're also recording a live interview with the CFA Toronto Wealth event on September 21st during the day. And that evening, we're hosting a meetup in Toronto for any listener that wants to come out. Again, reach out to info at rashreminder.ca if you want to come join us. Anything else? I don't think so. I think that's good. So people can reach us as always. We're on, do you still call it Twitter or is it Zitter? Does it change his name? Is it Zitter? I don't know. He's just called X.

1:01:47X. It's on X. So we're both on X. We both have Cali links on there. If you want to set up a time, help yourself. Both on LinkedIn. It's really cool. That email we got this morning is pretty cool. I feel like we need permission to share that. Don't share. I'm just saying we get this email. It's really cool. We got an email from someone who it was very cool to get an email from. That's as vague as I feel I need to be, but they listened to our podcast and they're interested in coming on as a guest, but it's someone who I was familiar with and was excited to receive an email from. Yeah. It's just a kind reach out.

1:02:23People are so kind. Even how Professor Cass Sunstein comes on, I started reading the book on a Sunday morning email, and he responded and said, sure. Yeah. Well, I think Mark talked about that too. Michael sent you an email it's the same thing people are perceptive and nice most of the time we have this experience all the time where we send emails to like you just said with Cass people that we feel like we have no business talking to you show an interest in their work and people are receptive I guess that's how the world revolves excellent all right great episode thanks everybody for listening