Planet Money: Inflation and the History of Money with Jacob Goldstein

00:00:00.000 | me and another reporter, David Kessenbaum and I went, we bought falafel and like a smoothie.

00:00:04.660 | And this was when Bitcoin was like, I don't know, 20, $20 for one Bitcoin, you know?

00:00:10.700 | And so, yeah, I mean, well, it's cheaper now than it was six months ago, right?

00:00:16.060 | Six months ago, it was a $50,000 lunch and now it's a $20,000 lunch.

00:00:19.880 | So if it keeps going, maybe it'll get back to normal.

00:00:21.940 | I mean, that does, to your earlier question about money and crypto, like money doesn't

00:00:30.460 | work that way.

00:00:32.060 | You don't regret buying a sandwich because the value of money, it actually appreciated

00:00:39.540 | so much.

00:00:40.540 | You don't hodl money.

00:00:41.540 | It doesn't make sense.

00:00:42.540 | That's not what money is for.

00:00:44.180 | And so, you know, on a simple level, it demonstrates the extent to which certainly Bitcoin is not

00:00:53.700 | money.

00:00:54.700 | And I think the closest thing to money in crypto, sort of ironically, given the history,

00:00:58.600 | is stable coins, right?

00:01:00.760 | Which is funny given that like so much of the sort of crypto noise is about the unreliability

00:01:04.980 | of the dollar, that the thing that actually functions like money is the thing that is

00:01:08.520 | pegged to the dollar.

00:01:09.520 | Hello, and welcome to another episode of All The Hacks, a show about upgrading your life

00:01:14.060 | money, and travel.

00:01:15.900 | If you're new here, I'm your host, Chris Hutchins, and I'm a diehard optimizer who loves doing

00:01:20.540 | all the research to get the best experience in life without the expensive price tag.

00:01:25.880 | That means optimizing travel, think flights, hotels, points, miles, money, think savings,

00:01:31.940 | investing, and getting deals, as well as life and work.

00:01:35.620 | Think happiness, leadership, negotiation, and so much more.

00:01:39.380 | To make this happen, I sit down with the world's best experts each week to learn the strategies,

00:01:44.700 | tactics, and frameworks that shaped their success.

00:01:48.300 | And this week, I'm talking to podcasting legend, Jacob Goldstein.

00:01:52.940 | Many of you know him as an NPR correspondent and the co-host of Planet Money for over a

00:01:57.460 | decade.

00:01:58.460 | Before NPR, he was a staff writer at the Wall Street Journal, and he recently published

00:02:02.940 | his first book, Money, The True Story of a Made-Up Thing, which is a fascinating look

00:02:08.420 | at the history of how money came to be.

00:02:10.980 | Finally, he just launched a new podcast this year called What's Your Problem, where he

00:02:15.780 | interviews founders and CEOs about how they solve the world's hardest problems.

00:02:22.140 | Our conversation today will be all about money, including what's going on with inflation,

00:02:27.240 | what you can do about it, the genesis of money, and what might be in store for its future,

00:02:32.500 | including how crypto might fit in.

00:02:34.460 | I'll also make sure to get some of Jacob's favorite money hacks along the way.

00:02:38.780 | So let's jump in.

00:02:39.780 | Jacob, welcome to the podcast.

00:02:47.140 | Thanks for having me.

00:02:48.140 | Hi.

00:02:49.140 | You've written a lot about inflation, and that it's often based on what people think

00:02:53.300 | and whether they think there should be inflation.

00:02:55.880 | So I'm curious if you think what we're in right now is a self-fulfilling prophecy of

00:02:59.380 | what people think that just will get compoundingly worse, or is this different because we kind

00:03:03.940 | of have these supply chain issues and the Russian gas stuff?

00:03:07.480 | So I hope it's not a self-fulfilling, compounding prophecy where it's just going to get worse,

00:03:12.740 | right?

00:03:13.740 | And it may not be.

00:03:14.740 | That is maybe like the most important macroeconomic question for the sort of medium term, you

00:03:20.620 | know, for the next year, couple years term, is do people expect inflation to stay high?

00:03:29.080 | And there is this weird thing about inflation, which is inflation expectations, what people

00:03:34.480 | think inflation is going to do, has a huge effect on what inflation actually does, right?

00:03:40.380 | And for a long time, a sort of bizarrely long time, we lived in this world where we had

00:03:45.200 | persistently really low inflation, right?

00:03:48.160 | After the financial crisis, through the aughts, into the teens, whereby like 2019, we were

00:03:54.040 | in this world where unemployment was super low, the economy was doing well, the government

00:03:58.280 | was borrowing tons of money, and all of those things you would think would give you higher

00:04:03.200 | inflation, right?

00:04:04.200 | That classically is a really inflationary environment and we didn't see it.

00:04:07.600 | And part of the reason it seems, it's kind of a mystery why we didn't see it, but part

00:04:11.340 | of the reason it seems is because people expected it would stay low.

00:04:16.000 | So now what do people think?

00:04:17.440 | I mean, you can look at the markets, you know, you can look at various financial markets

00:04:21.240 | and people don't think inflation is going to stay at 8% for like five years.

00:04:24.840 | So that's kind of encouraging.

00:04:26.100 | So I'm hoping people's expectations are still kind of moderate.

00:04:29.560 | I was doing some quick math, looking at what is inflation been like in some countries.

00:04:34.080 | And if you go back and look, Argentina, Venezuela, Zimbabwe, 8% seems like nothing.

00:04:38.680 | But even right now, Turkey is like in the 50%.

00:04:42.360 | So is 8% really that unreasonable?

00:04:46.440 | Inflation is weird because it can be nonlinear, right?

00:04:49.600 | And it's useful to distinguish 8%, high inflation that we have now from your, certainly Venezuela,

00:04:58.420 | Zimbabwe is where it was like thousands of percent.

00:05:00.540 | So it was just runaway.

00:05:02.340 | And also Turkey, whereas you say it's 50%.

00:05:04.420 | I mean, in those runaway cases, in those Venezuela, Zimbabwe cases, it's not just inflation.

00:05:11.500 | It's basically an economic collapse, right?

00:05:14.100 | And the inflation is as much or more an effect, a symptom of the underlying collapse as the

00:05:21.760 | cause, right?

00:05:22.800 | We don't have that.

00:05:24.600 | We're not going to be Venezuela or Zimbabwe.

00:05:26.360 | And if somebody says that, it means they don't know what they're talking about.

00:05:29.120 | But 8% inflation is bad.

00:05:32.200 | I mean, one thing that's really striking is people just hate it, right?

00:05:38.040 | Like people really hate inflation.

00:05:40.680 | And the other simple thing is real wages are going down, right?

00:05:46.100 | If you look at how much wages are going up versus inflation, inflation is going up faster

00:05:50.580 | than wages.

00:05:51.700 | And that doesn't usually happen, especially when the economy is growing.

00:05:55.060 | And that means people are getting poorer.

00:05:57.020 | And it's bad when people are getting poor.

00:05:58.700 | That's the simple reason of why inflation is bad.

00:06:01.180 | It is a basket of goods, and some of them can have an outweighed impact.

00:06:06.580 | Are there any areas that you're aware of right now that aren't really doing as poorly, where

00:06:11.160 | it might actually be-- I know fuel prices are driving inflation significantly.

00:06:15.700 | Yeah, so it's interesting to think about the different components of inflation.

00:06:20.740 | Fuel is obviously the most salient one, right?

00:06:24.620 | Gas, gas prices.

00:06:26.260 | And gas prices are really interesting.

00:06:27.740 | So if you look at the sort of budget, the typical household budget, which is like the

00:06:32.020 | inflation basket, all the stuff a typical family buys.

00:06:35.500 | Gas is somewhere around like 5%.

00:06:38.660 | So it's not that much, right?

00:06:41.480 | But one, the price of gas went up way more than the price of basically anything else,

00:06:46.340 | right?

00:06:47.340 | It essentially doubled.

00:06:48.340 | And the price of nothing else really doubled.

00:06:50.820 | Two, and this is-- two is psychological, right?

00:06:54.260 | You see gas prices in like giant numbers as you're driving around.

00:06:58.620 | You stand there pumping the gas in your car, and you see the numbers going up in front

00:07:03.180 | of you.

00:07:04.180 | And so it has a disproportionate impact on people's awareness, right?

00:07:09.020 | People freak out about gas prices in a way that they don't freak out about, say, health

00:07:13.240 | care, right?

00:07:14.240 | Health care prices, in fact, right now are not going up that fast, not going up as fast

00:07:19.340 | as I think the rest of inflation.

00:07:21.020 | I haven't checked on that number in a while.

00:07:23.140 | And health care is a bigger chunk of the household spending basket than gas.

00:07:28.480 | But it's like the opposite in terms of salience, right?

00:07:30.900 | Like if you have a job, and you get health insurance through your job, your employer

00:07:34.500 | is just straight up paying a bunch of your health insurance premium.

00:07:37.420 | So you don't even see that.

00:07:38.820 | And then the part that you're paying comes out of your paycheck.

00:07:42.100 | So you don't really notice it unless you're like looking through all the stuff, you know,

00:07:46.780 | on the gross part of your paycheck that's not flowing through to the net.

00:07:49.820 | So it's like health care is like the least salient part.

00:07:53.120 | And interestingly, it's a place where at this moment, inflation is relatively low.

00:07:56.960 | So those are kind of two poles.

00:07:59.300 | And to the point I made earlier about people's expectations.

00:08:01.820 | One thing that I kind of personally am fearing is there's kind of a everyone assumes inflation

00:08:07.540 | is high right now.

00:08:08.540 | Maybe even people are assuming it's higher than it actually is, right?

00:08:11.460 | If you see gas prices double, that's not 8%.

00:08:14.980 | And when they report 8%, they're annualizing a number, right?

00:08:18.740 | So it's like if it went up 1% in a month, it would be 12% reported.

00:08:24.260 | Yes.

00:08:25.260 | Well, sometimes they're doing year over year, they do do the month over month.

00:08:28.460 | But the typical annual number they're doing the year over year.

00:08:31.460 | But they're not saying in May, prices went up 9% or 8%?

00:08:35.220 | They're not.

00:08:36.220 | They're saying between May of 2021 and 2022, prices went up 9%.

00:08:40.940 | People traditionally, like there are surveys, people traditionally think inflation is higher

00:08:45.060 | than it is, you know, at baseline.

00:08:48.720 | So does that give restaurants kind of permission, even if their underlying food costs haven't

00:08:54.800 | gone up 10 or 15%, you know, are they like, "Oh, you know, we might as well raise prices

00:08:58.740 | right now.

00:08:59.740 | Everyone's going to accept it because everyone assumes prices are going up."

00:09:02.420 | And it kind of creates this, "Okay, well, now food prices are up."

00:09:05.820 | And everyone's like, "Oh, now I need, you know, to work an extra job, or I need to demand

00:09:08.940 | for my employer."

00:09:09.940 | And employers are like, "Well, if we're going to pay people, we got to raise our prices."

00:09:12.420 | And even though the underlying food might not be getting it as expensive.

00:09:16.380 | Well, so there's a lot in that question, and it's worth unpacking it, right?

00:09:21.220 | So one part of that question is, can businesses sort of sneak in price hikes under the sort

00:09:28.400 | of veil of broader inflation, right?

00:09:31.420 | And it's an interesting question to think about.

00:09:33.260 | I mean, I personally am a price conscious consumer, right?

00:09:39.100 | Like I like a deal.

00:09:40.100 | I know what I'm paying.

00:09:41.100 | I look at the price before I buy things.

00:09:43.180 | And you know, we want businesses to be competing against each other all the time, right?

00:09:50.000 | Inflation is good for consumers.

00:09:51.880 | And so if, you know, when we order in, we usually order in Thai, right?

00:09:58.600 | And there's two or three Thai restaurants that we order from, and they're like pretty

00:10:01.120 | similar.

00:10:02.120 | And if one of them suddenly got more expensive, I would just start ordering in from the other

00:10:05.600 | one, right?

00:10:06.600 | So they're competing on price.

00:10:07.600 | And so if they colluded, they could raise prices, but that's always true, right?

00:10:11.240 | I assume they're not colluding.

00:10:12.600 | So I don't think there is that much room for that.

00:10:16.440 | I mean, what there is, and this is the, you know, important, I think most important piece

00:10:22.160 | of inflation right now is not expectations.

00:10:24.940 | That's important for the long run.

00:10:26.020 | But as you alluded to earlier, you know, basic supply and demand are the two drivers right

00:10:31.200 | now.

00:10:32.200 | There's, you know, less supply certainly of oil, to some extent of food, both because

00:10:35.340 | of the war in Ukraine, and then to some extent manufactured goods, because China has been

00:10:40.960 | doing this, you know, COVID zero extreme lockdowns.

00:10:43.440 | And so their manufacturing output has declined.

00:10:45.320 | So that's less supply.

00:10:46.880 | And then demand is high.

00:10:48.200 | And that's important for price increases, right?

00:10:50.160 | Demand is high because, weirdly, it doesn't feel like it, but the economy has been really

00:10:55.400 | strong.

00:10:56.400 | I mean, it feels like all of a sudden, it's like, whoa, are we in a recession?

00:10:58.320 | But unemployment is below 4%.

00:11:01.200 | Savings is really high for US households.

00:11:03.360 | And so people are willing to pay more, right?

00:11:06.480 | And that piece goes to your question.

00:11:09.820 | People are willing to pay more because they have more money, and also because their wages

00:11:12.600 | are going up.

00:11:13.600 | Their wages are going up faster than they've gone up for a long time, just not as fast

00:11:17.240 | as inflation.

00:11:18.240 | So demand is high.

00:11:19.400 | So that allows, that does allow companies to raise prices.

00:11:23.280 | But we hope that's constrained by competition.

00:11:26.560 | Let's talk about one thing that you mentioned to me right before we rolled.

00:11:31.040 | Inflation can be a good thing for a certain type of product.

00:11:35.480 | I'll let you, I won't steal your lead.

00:11:37.680 | For sure, for a certain type of person.

00:11:39.760 | If you have debt, and your debt is at a fixed interest rate, not a variable interest rate,

00:11:47.040 | inflation on average makes it easier to pay off that debt, right?

00:11:51.280 | Like as I mentioned, wages are going up really fast, faster than they've gone up in a long

00:11:56.760 | time.

00:11:57.760 | And that is partly a result of inflation, right?

00:12:00.720 | Prices of everything are going up.

00:12:03.360 | And labor is a price.

00:12:04.520 | We don't think of it as a price, but it is, right?

00:12:07.000 | When you go to work, you are selling your labor.

00:12:09.360 | And the price of labor is going up.

00:12:11.120 | And so that's good.

00:12:12.120 | If you are a person who sells labor for a living, it means you're getting more money.

00:12:15.320 | And notably, if you have a student loan or a mortgage, that is at a fixed interest rate.

00:12:22.440 | I have a mortgage that's at 2.9%, not to brag, but I was fortunate to buy a house last year.

00:12:30.220 | So my wages are going up.

00:12:33.800 | My mortgage payment is staying the same.

00:12:35.960 | So what that means is as my wage goes up, I have to work less to make the same mortgage

00:12:41.920 | payment, right?

00:12:44.000 | So that's good for me.

00:12:45.040 | And it's bad for the bank, frankly, right?

00:12:46.780 | They're getting paid back in dollars that are less valuable.

00:12:50.060 | The higher inflation, the less each dollar I pay the bank buys.

00:12:54.300 | So like it's definitely a win for debtors, although, you know, obviously in a limited

00:12:58.880 | way.

00:12:59.880 | And people get mad when you say that because nobody wants to hear that anything is good

00:13:02.640 | about inflation.

00:13:04.320 | Well, I mean, I'll give an example.

00:13:05.920 | So I bought a car and it was a Tesla that I've been waiting a year for, and it was kind

00:13:11.560 | of two crazy things.

00:13:13.080 | One, you could see the inflation because Tesla, thankfully, locks in the price when you buy

00:13:18.680 | it.

00:13:19.680 | So when I put in the order for it last year, it was locked in at one price and that price

00:13:22.680 | went up about 20% since I ordered it.

00:13:25.640 | So when I went to...

00:13:26.640 | Could you have just sold it back to the dealer for more than you paid for it?

00:13:30.480 | Well, here's the crazy thing.

00:13:31.560 | I was thinking the price today is 20% higher and you have to wait a year.

00:13:36.440 | So I was like, "Man, if I could sell my place in line, someone would presumably pay more

00:13:41.120 | than 20% because they would get it now instead of a year from now."

00:13:45.520 | And then I thought, "Gosh, if only Tesla reservations were on the blockchain and it was easy to

00:13:48.920 | transfer."

00:13:49.920 | But we can get there.

00:13:50.920 | It wouldn't have to be on the blockchain.

00:13:51.920 | It wouldn't have to be on the blockchain.

00:13:52.920 | I know.

00:13:53.920 | I know.

00:13:54.920 | It's just what came to my mind living in Silicon Valley.

00:13:55.920 | I mean, if anybody was going to put reservations on the blockchain, it would be Tesla, right?

00:13:59.240 | If only you'd paid a doge.

00:14:01.120 | Oh man.

00:14:02.120 | If you paid a doge, you'd be screwed.

00:14:04.600 | So I was looking for a loan.

00:14:06.160 | I was looking for a loan and I will share one tip for anyone listening.

00:14:10.000 | You do not need to finance your vehicle with the company you buy the car from.

00:14:16.220 | Many people had told me, "Oh, what's Tesla's rate?"

00:14:18.640 | I was like, "Well, I shopped my rate online and I went and looked at tons of credit unions

00:14:23.960 | around the country and some of whom only adjust their rates monthly, some of whom don't really

00:14:28.860 | adjust them at all.

00:14:30.640 | And the range of rates I saw were anywhere from three, 4% for Tesla, I think was at 3.74

00:14:37.780 | to the lowest rate I could find for a five to six year loan was 1.99%.

00:14:41.880 | 1.99 is really low for a five year loan right now.

00:14:46.600 | That's amazing.

00:14:47.600 | And that's now.

00:14:48.600 | That's in this, when a mortgage is, what is a mortgage now?

00:14:50.920 | Five or six, right?

00:14:51.920 | Yeah.

00:14:52.920 | It made no sense to me, right?

00:14:54.840 | High yield savings accounts right now are paying, I know the Wealthfront Cash Account

00:14:59.460 | is at 1.4%.

00:15:00.460 | I was like, "Gosh, you're almost at the point where if rates go up as expected, over the

00:15:05.820 | next few months."

00:15:06.820 | We're just two or three year treasuries, right?

00:15:08.300 | Two or three year treasuries are at what 3% or something last I checked.

00:15:12.420 | So I mean, there is a tax thing there, but yeah, it's obviously a sweet deal to finance

00:15:16.460 | at 1.99%.

00:15:17.460 | But it's pretty close.

00:15:18.460 | We're not that far away from the ability to earn more than your loan cost if you locked

00:15:23.580 | it in.

00:15:24.580 | And so for anyone listening, definitely go look around.

00:15:28.660 | I might even link to this Tesla Google sheet where people that are from some Tesla forum

00:15:33.540 | put every credit union, all the deals there.

00:15:35.940 | I went to credit union one, had a great experience, highly recommend it, but I locked it in.

00:15:41.740 | They told me they could lock the rate in for 60 days.

00:15:44.180 | And so I locked it in the morning of the Fed rate cut because I wanted the most time to

00:15:48.580 | buy the car.

00:15:49.580 | You knew it was going to go up.

00:15:50.580 | You knew it was going to go up.

00:15:51.580 | You would think they would have known it too, right?

00:15:53.380 | It's interesting that it was so low, but you know, it means you're going to be paying that

00:15:57.780 | money back in dollars that are worth a lot less than dollars are worth now, right?

00:16:02.140 | A dollar four years from now when you're still paying off your loan is going to be worth,

00:16:07.260 | you know, more than 10% less than a dollar today.

00:16:10.260 | We don't know the path of inflation, but 15, 20% less, right?

00:16:13.700 | It could be a lot less.

00:16:15.860 | Based on treasuries and everything, like it's definitely going to be worth less.

00:16:19.860 | And the thing that blows my mind, there's a tool, the CME group has this tool on their

00:16:24.260 | website called the FedWatch tool.

00:16:26.220 | I don't know if you've seen it.

00:16:27.220 | And it shows the probabilities of rate hikes at different Fed meetings.

00:16:31.900 | And the thing that I thought was so crazy was I'm literally going to pull it up here

00:16:35.860 | and it says, you know, by the end of the year, December 22nd, there is a 42.6% chance it

00:16:42.780 | will be in the 3.25 to 3.5% range.

00:16:46.900 | And then a 34% chance it'll be 3.5 to 3.75 and then an 8%, it's 3.75 or more.

00:16:52.460 | And to be clear, that rate is just the overnight rate, right?

00:16:57.380 | It's not a five-year rate.

00:16:58.500 | It's the overnight rate for the safest credit there is, basically.

00:17:01.500 | So it's wild that it's going to be that much higher and that you were able to lock in a

00:17:05.540 | five-year loan at one point.

00:17:06.940 | And it wasn't just one credit union.

00:17:08.780 | Most of them were 1.99 to 2.5, even though people way smarter than me and spending more

00:17:14.860 | time on this than me are like 80-plus percent confident that rates will be in the 3% by

00:17:20.940 | the end of the year.

00:17:21.940 | Yeah, it's interesting to think about what's going on on the credit union side, like why,

00:17:27.580 | like where are they getting the funding?

00:17:29.300 | I mean, I guess it's deposits, right?

00:17:30.740 | They're still paying zero on deposits.

00:17:32.500 | Now, if deposit rates have to go up, then they might get underwater, right?

00:17:36.540 | That's a thing that has happened.

00:17:37.540 | They might get screwed being on the other side of your loan.

00:17:40.460 | But for now, they're paying 0% to get deposits and lending to you at 2%, I guess.

00:17:45.300 | And that's why I think it's important for everyone to realize that most banks that are

00:17:49.340 | lending the money out to you, like most of the average Chase Bank of America, Wells Fargo,

00:17:54.700 | they're paying no interest on their savings accounts.

00:17:57.220 | I'm sure they're still playing, it's close to zero, isn't it?

00:18:01.260 | And checking accounts, I mean, we've forgotten now, but checking accounts used to pay interest.

00:18:06.380 | Oh, yeah, you cannot, it is hard to get interest at a brick and mortar bank these days.

00:18:11.820 | So as inflation rises, I was going to ask you what you're doing to prepare for inflation,

00:18:16.820 | but I'll share one thing, which is as inflation rises, and different institutions are paying

00:18:22.060 | over 1%, or hopefully in the future, over 2% or 3% on savings, leaving your money at

00:18:28.140 | a place paying 0% is not a great idea.

00:18:31.140 | I'm curious what you might be doing.

00:18:32.980 | Yeah.

00:18:33.980 | I mean, so a couple of things, right?

00:18:35.460 | And as I mentioned, I bought a house a year ago, before that, I was saving a down payment,

00:18:40.340 | right?

00:18:41.340 | So enough money to make it worth, enough cash to make it worth sort of shopping around.

00:18:45.500 | And I used American Express has an online high yield savings account.

00:18:51.020 | And it went to zero during the pandemic when everything else went to zero.

00:18:54.900 | But that one, I think it's back up, a lot of them like it.

00:18:57.380 | I think I saw an ad for Marcus, which is Goldman Sachs sort of consumer facing online bank.

00:19:01.580 | So there are a lot of just FDIC insured, you know, totally liquid, put it in today, take

00:19:06.020 | it out whenever you want that are up around 1% now.

00:19:08.580 | I mean, my favorite one, I don't know if you've talked about it on the show.

00:19:12.580 | Have you talked about IBONS on the show?

00:19:15.100 | I've written about IBONS in my newsletter.

00:19:18.260 | And I'm doing an AMA episode where people are asking where to put cash right now.

00:19:23.520 | And IBONS was the answer.

00:19:24.520 | We haven't talked about them.

00:19:25.520 | So we could just go now.

00:19:26.520 | And I could just skip that on the AMA.

00:19:28.300 | Well, I don't want to, I don't want to step on.

00:19:30.500 | I don't know.

00:19:31.500 | But it's my favorite answer.

00:19:32.500 | It's the thing that I'm most, like, I don't generally believe in tips.

00:19:37.020 | You know, my basic investing tip is always just like, buy, buy index funds, right?

00:19:43.180 | Just buy index funds and look away.

00:19:45.060 | Don't do anything because whatever you do, you could do the wrong thing.

00:19:48.260 | We could talk about tax loss harvesting, right?

00:19:51.020 | But anyways, so my big hack with money that I'm excited about now is IBONS.

00:19:58.220 | You obviously know about them too, so we can both talk about them.

00:20:01.260 | What are they?

00:20:02.260 | Let me ask you.

00:20:03.260 | What's an IBONS?

00:20:04.260 | So the government has these bonds that they issue.

00:20:06.820 | It's a series I savings bond.

00:20:10.340 | You know, you can only buy them on a terrible website, TreasuryDirect, or.

00:20:14.180 | So bad though, so bad.

00:20:16.640 | It's literally, for anyone who hasn't used it, the only way you can enter your password

00:20:20.740 | is through a virtual keyboard that you have to click with each letter with your mouse.

00:20:24.500 | It's really hard.

00:20:26.100 | Or I think you can still buy them paper ones with your tax refund.

00:20:30.060 | Yeah.

00:20:31.060 | So, so yes, up to.

00:20:33.220 | So you can buy them and there's limits on how much you can buy.

00:20:35.500 | You can buy up to $5,000 with a tax refund and up to $10,000 just straight up on the

00:20:42.340 | terrible website.

00:20:43.540 | I should also make a distinction.

00:20:45.740 | Sometimes people confuse them with with TIPS, which are Treasury Inflation Protected Securities,

00:20:51.240 | I think it stands for.

00:20:52.240 | But it's a different thing.

00:20:53.240 | And those are like a regular market.

00:20:54.980 | The amazing thing about IBONs is basically they are guaranteed to pay an interest rate

00:21:01.980 | that keeps up with inflation.

00:21:04.020 | Essentially, there's some formula, but that's basically what it is.

00:21:07.660 | Yeah, they have a they have a rate that right now I think is actually zero.

00:21:12.200 | That is like the base rate.

00:21:13.520 | And then they add on every six months, they change whatever the current inflation rate

00:21:18.260 | is.

00:21:19.260 | So from May, May 2022 to October, if you get one, you'll get the first six months, you'll

00:21:24.560 | get nine point six, two percent interest.

00:21:27.520 | And we should just pause and wave our hands at nine point six, two percent interest, right?

00:21:33.980 | Like this is the most safe, you know, borrow.

00:21:39.260 | You're lending your money to the government, the safest thing you can do with it.

00:21:43.420 | You have to leave it in for a year, essentially.

00:21:46.240 | There's like a small penalty if you take it out less than five years, you have to leave

00:21:49.060 | it in for a year.

00:21:50.100 | But getting nine point six percent interest from the government guaranteed is extraordinary.

00:21:55.620 | And I should add, depending on how fortunate you are, how much cash you have.

00:21:59.360 | So it's limited to ten thousand per person per year.

00:22:01.500 | But you can also open an account for your kid or your kids.

00:22:05.300 | So I actually I opened one for each of my daughters and I and I bought the Max last

00:22:11.660 | year and I bought the Max this year.

00:22:13.620 | And you know, I mean, I also have a lot of money in the stock market that I've watched

00:22:16.980 | go down.

00:22:17.980 | And it's like to me, I now have a non-trivial amount of money that is very safely and comfortably

00:22:22.780 | going up.

00:22:23.780 | And it just makes me happy to think about it.

00:22:25.820 | We did the same.

00:22:26.820 | If you have a revocable trust, which in an episode recently we talked about, you know,

00:22:32.260 | is not the same thing as these crazy high net worth trust.

00:22:34.940 | It's a pretty basic legal document that can be another entity.

00:22:39.020 | And so you could do another one there.

00:22:41.100 | So you know, if you had a family of four, you could conceivably put five that fifty

00:22:45.460 | thousand five, ten thousand dollar savings, series I savings bonds or bonds in a year,

00:22:51.300 | which is a real amount of money.

00:22:53.020 | It's a lot, even if inflation goes to zero before the end of the year, which I think

00:23:01.140 | is very unlikely personally.

00:23:03.080 | But even if inflation went to zero, you would earn nine point six two percent for the first

00:23:08.580 | six months or four point eight one because, you know, it's an annualized rate and then

00:23:12.900 | zero on the rest of the year.

00:23:13.900 | So even earning four point eight one percent is a much larger number than any other government

00:23:21.300 | backed place I've seen.

00:23:22.560 | You could invest money for, you know, less for a one year horizon.

00:23:26.220 | Other side.

00:23:27.220 | Right.

00:23:28.220 | If inflation keeps going up, the interest rate you receive, you know, it resets, as

00:23:32.620 | you said, every what is it, six months?

00:23:34.540 | It keeps going up.

00:23:35.900 | So like.

00:23:37.660 | It's a wildly like it shouldn't exist, right?

00:23:40.460 | Like it's a weird it's like a loophole because like.

00:23:43.660 | I have to assume the reason there is a cap is because this is not a profitable endeavor

00:23:48.860 | for the U.S. government.

00:23:49.860 | No, it doesn't make any sense, right?

00:23:51.500 | People are like the rate on on, you know, these kinds of.

00:23:56.500 | They borrow most of their money, you know, from the market and the market will will accept

00:24:00.380 | a profoundly lower rate of interest.

00:24:02.500 | So I mean, I think the idea is to encourage saving, right?

00:24:05.460 | Their savings bonds, right?

00:24:06.460 | Like if you're old enough, like when I was a kid, you know, like your uncle would give

00:24:09.660 | you like a hundred dollar savings bond and they would pay fifty dollars for it.

00:24:12.820 | And the idea is like you hold it for ten years and then you can cash it in for a hundred

00:24:15.860 | or something.

00:24:16.860 | And I think this is the sort of legacy of that.

00:24:20.980 | Yeah, well, it's a real hack, though.

00:24:23.440 | Like I feel good.

00:24:24.440 | I feel like I'm bringing a hack to the show with that one.

00:24:27.060 | I totally agree.

00:24:28.340 | And you talked about things not making sense that the government does with money, which

00:24:32.020 | is a great thing I wanted to talk about.

00:24:34.860 | In a past episode, I talked with someone about charisma, Vanessa Van Edwards, and we talked

00:24:39.280 | about how it was this thing that everyone kind of knows.

00:24:41.820 | But when you actually try to say like, what is it really?

00:24:45.560 | People can very rarely answer the question.

00:24:49.020 | The answer she found was that it's a balance of warmth and competence.

00:24:53.100 | But you know, I was thinking about money and your book made me think, gosh, money is kind

00:24:57.700 | of similar.

00:24:58.700 | It's this thing that, you know, you did an interview on This American Life for an episode.

00:25:03.220 | Ira Glass called what is money the most stoner question he'd ever posed on the on the show.

00:25:09.460 | And it made me think, gosh, it's this thing that we all know what it is, but like, what

00:25:12.540 | is it really?

00:25:13.620 | And that led you to write an entire book.

00:25:15.960 | So I'm going to just ask you now that you're the expert, like what what is money?

00:25:21.140 | The reason it seemed interesting enough to me to write a book about is at a more complex

00:25:27.580 | level, the answer to that question has changed an incredible amount over time, right?

00:25:33.020 | The book is a history book, basically.

00:25:36.140 | It's like a series of origin stories, really, of of money.

00:25:40.580 | And the really striking thing to me, I think, at the root is at any given moment.

00:25:49.540 | What money is just seems like the natural state of the world, right?

00:25:53.700 | Like most people most of the time don't really think about it.

00:25:57.060 | They just think, oh, yes, this piece of paper, my wallet, this number in my account, that's

00:26:00.780 | what money is fine, whatever.

00:26:02.920 | That's just the way the world works.

00:26:04.380 | But the lesson, the insight to me that was really interesting, exciting is it's not necessarily

00:26:10.260 | the way the world works.

00:26:11.260 | It didn't used to work that way.

00:26:12.380 | It'll probably be different in the future.

00:26:14.380 | And so that's that's what's fun.

00:26:15.980 | Money turns out to be this, you know, set of rules, the set of arrangements that a society

00:26:22.060 | agrees on without really realizing that they're agreeing on something.

00:26:26.680 | Quite often it is kind of emergent and they're like it's kind of bottom up more than you

00:26:31.100 | might think, rather than, you know, let's have a constitutional convention and decide

00:26:35.020 | what money is.

00:26:37.220 | So we're not going to go through the entire history because there's a wonderful book that

00:26:40.800 | I read in advance of this.

00:26:42.500 | Yeah, you can read it first.

00:26:44.180 | But where did it all start?

00:26:45.540 | I think I didn't think it started where it did.

00:26:48.460 | And I'd love at least that story to jump in here and let people get a little glimpse.

00:26:53.340 | Yeah.

00:26:54.340 | So.

00:26:55.340 | There's where, like the best guess now of where it started, and then there's what people

00:26:59.780 | always thought.

00:27:00.780 | Right.

00:27:01.780 | And it's interesting to to distinguish between them.

00:27:03.340 | For a long time, there was this sort of a parable, almost a kind of just so story that

00:27:09.700 | people told about the origin of money.

00:27:12.000 | And that was, you know, before there was money, there was barter, right, trade.

00:27:17.360 | And barter was inconvenient because for you and me to make an exchange, not only did I

00:27:24.340 | have to have something that you want, but you also had to have something that I want.

00:27:28.180 | Right.

00:27:29.180 | So maybe I've got a thing and you want my thing, but you don't have anything that I

00:27:32.540 | want.

00:27:33.540 | So we can't make a deal.

00:27:34.540 | Right.

00:27:35.540 | And that sucks because it would be good if we could make a deal.

00:27:37.340 | It'd be good for me and it would be good for you.

00:27:39.460 | And money solves that problem.

00:27:40.820 | Right.

00:27:41.820 | Then if you want something I have, I don't care what stuff you have.

00:27:45.100 | Just give me some of your money and I'll give you this thing that I have that you want.

00:27:48.320 | Right.

00:27:49.320 | That's the traditional story of money emerged from barter.

00:27:53.620 | The thing is in the 20th century, basically, anthropologists from largely Europe and the

00:28:00.020 | U.S. started going around the world and studying different societies in, you know, stages of

00:28:06.660 | development that people had imagined this kind of barter universe would exist in.

00:28:11.860 | And what the anthropologists found was they weren't like that into barter.

00:28:17.100 | What they were much more into was social agreements about like borrowing and lending and gift

00:28:25.740 | giving and reciprocity.

00:28:27.340 | There were all these rules.

00:28:28.340 | Right.

00:28:29.340 | And so these are basically tribal societies.

00:28:30.860 | Right.

00:28:31.860 | They're small, you know, kinship based groups of people where everybody knows everybody

00:28:35.740 | else.

00:28:36.740 | And there are lots of rules about exchange, essentially, you know, exchange of material

00:28:41.620 | goods.

00:28:42.620 | Some of the sort of canonical cases have to do with marriage is a big one.

00:28:47.180 | There are very often rules like if you're going to marry somebody, you know, you have

00:28:51.780 | to give their family, your family has to give their family cattle or your family has to

00:28:56.380 | give their family a certain kind of boar tusk or whatever.

00:29:00.860 | Another one was around murder.

00:29:02.620 | Kind of awesomely.

00:29:03.620 | Lots of societies have rules where, like, if you kill somebody, then your family has

00:29:07.620 | to give their family, you know, typically same kind of stuff.

00:29:10.340 | Cattle in a lot of places, cowry shells, whatever, some some prescribed thing.

00:29:15.620 | And those things, those are really proto money.

00:29:20.620 | Right.

00:29:21.620 | Because once there's a thing where it's like, well, probably not going to murder somebody,

00:29:25.100 | but like my kid's probably going to get married and when my kid gets married, I'm going to

00:29:29.220 | need some cows to give to, you know, the bride's family or whatever.

00:29:33.380 | That's really, I think, the best guess for the roots of money.

00:29:39.380 | It reminds me of something I think you probably wrote in the book that said, you know, it's

00:29:43.300 | also money is what you have to pay your taxes with.

00:29:46.020 | It's like the reason I care about having dollars in my bank account is because that every every

00:29:49.940 | April I have to send dollars to the U.S. government and they only accept that.

00:29:54.360 | It's a good starting point.

00:29:55.360 | And certainly in places and times where different things are sort of competing to be money,

00:30:01.060 | you know, that's a world we're not used to now.

00:30:02.700 | But there have been times where that was the case.

00:30:05.520 | If the government comes in and says, you will pay your taxes in this thing, and sometimes

00:30:09.960 | it was cloth and sometimes it was some currency, then that thing becomes like the cows you

00:30:15.460 | have to give for marriage, a thing everybody's going to need at some point.

00:30:18.820 | And and yes, it becomes money.

00:30:19.940 | I mean, one of the interesting things distinguishing between the sort of barter story and the,

00:30:25.060 | you know, marriage and murder story is the barter story is really this very cold, impersonal

00:30:30.820 | market story, which I think is like the typical sort of vibe we associate with money.

00:30:36.300 | But it's really interesting to me to think about the other story, right, the murder and

00:30:39.860 | marriage story, because that's a much more like hot, social, interactive story of what

00:30:46.200 | money is.

00:30:47.200 | And that side of money, right, this social creation, this thing that works because we

00:30:52.420 | all agree to use something as money is a really interesting piece of it.

00:30:58.040 | And I think underappreciated.

00:31:00.420 | And you mentioned cattle as an example.

00:31:02.500 | Cattle is not something easy to bring up and divide and all that divide.

00:31:07.260 | No, no.

00:31:08.600 | Is that ultimately what drove to the kind of creation of paper money was like, we just

00:31:13.500 | we can't I need something from you.

00:31:15.860 | And a cattle is just too valuable.

00:31:17.700 | How did we get because I don't think it was like overnight that we just switched there.

00:31:21.700 | How did how did what happened then when you needed half a cattle?

00:31:25.740 | And how did we end up?

00:31:26.740 | Yeah, so, so, so paper was much later for sort of technical reasons.

00:31:30.860 | Paper wasn't invented until like, I don't know, 1000 AD, hundreds of years AD.

00:31:34.300 | But coins, coins came along first.

00:31:37.420 | Coins came along around, I don't know, 600, 700 BC.

00:31:41.700 | And the short answer to your question is yes.

00:31:44.160 | But the longer answer to your question is, so, you know, before coins, whatever, if you

00:31:49.460 | go back to the ancient, ancient world, there were these small, you know, sort of tribal

00:31:54.600 | societies like we talked about.

00:31:56.060 | And then there were bigger civilizations, right?

00:31:58.540 | If you think of the classic cradle of civilization, you know, the Eastern Mediterranean and those

00:32:04.660 | societies were very top down, right?

00:32:08.580 | They were like today we'd call them command and control economies, right?

00:32:12.060 | There was somebody there was a ruler, like a king or a queen or a priest or whatever.

00:32:16.700 | And they would essentially direct the exchange of good.

00:32:20.180 | They would, you know, take grains from the farmers and give them to the bureaucrats who

00:32:24.740 | worked at the temple or whatever.

00:32:26.020 | So there was not a market exchange, or at least not to the extent at all that we're

00:32:31.600 | used to.

00:32:32.600 | Right?

00:32:33.600 | So, so there was a solution to like, how do you do exchange in a bigger civilization?

00:32:38.180 | Well, you just have a king take and give and decide what everybody's going to get.

00:32:42.020 | But then the first place coins really took off was ancient Greece, interestingly.

00:32:47.360 | And I think arguably, not coincidentally, certainly interestingly, around the time democracy

00:32:53.280 | was emerging, right?

00:32:55.140 | And what you had in ancient Greece, this is like, you know, classical Greece, the Olympics,

00:32:59.420 | the whole thing was something that was bigger and more complex than a tribal civilization/economy,

00:33:06.900 | but also a more bottom up power distribution than you had in these, you know, very top

00:33:12.900 | down kingdoms.

00:33:13.900 | And so you needed some new way to do material exchange that was neither top down nor everybody

00:33:20.500 | knows everybody and we all share the same rules and coins, money was the perfect solution

00:33:25.460 | for that.

00:33:26.680 | And back then and fast forward a lot longer than I thought.

00:33:30.220 | So I was blown away reading that in the 1800s, we still had lots of different kinds of money.

00:33:36.620 | It wasn't like we'd centralized on this is the kind.

00:33:39.420 | So I'm intentionally fast forwarding because there's a book, go read the book.

00:33:42.940 | I thought it was great.

00:33:43.940 | We don't need to recap the entire book.

00:33:46.380 | But I'm going to make a hard turn from the conversation of the history of money and talk

00:33:52.100 | about maybe a little bit of the future, which was, I think you said there was 8,370 kinds

00:33:58.460 | of money somewhere in the mid 1800s in the US, and I thought, okay, right now it feels

00:34:03.620 | like if you talk to a lot of people, the future of money is something online and there's all

00:34:07.500 | these cryptocurrencies.

00:34:08.500 | I was like, it feels like there's probably 8,370 different cryptocurrencies.

00:34:13.220 | I'm curious what happened in that last, let's call it 200 years, watching money evolve from

00:34:21.340 | lots of different things to get more centralized.

00:34:24.480 | Do you think anything like that plays out in the world of crypto and how do you think

00:34:27.540 | it falls into the world of money?

00:34:30.060 | I know it's a loaded question.

00:34:31.500 | Yeah, no, it's an interesting question.

00:34:36.060 | So let me just say a little thing about the moment you're alluding to in the 1800s and

00:34:40.380 | then we can jump to now because it'll help it make more sense.

00:34:42.680 | So the way it worked in the US in the like 1830s, '40s, '50s was there was the dollar.

00:34:49.180 | The dollar was the unit of account, right?

00:34:52.100 | But private banks issued their own paper money and this was still the era when paper money

00:34:57.380 | was like a claim check for gold, right?

00:34:59.260 | The real value or silver, the real value was the precious metal.

00:35:02.540 | And so there were in fact 8,000 different kinds of paper money because each bank issued

00:35:07.600 | different looking pieces of paper and it was wild and interesting.

00:35:10.340 | And like you said, you can read all about it.

00:35:12.380 | But still the underlying thing was the dollar.

00:35:17.100 | So there are some elements that are similar to cryptocurrencies and some that are different

00:35:20.060 | and people have been writing about that.

00:35:21.980 | I mean, the thing that has happened over the last couple hundred years is the government

00:35:27.680 | has gotten more and more power over money, right?

00:35:29.820 | Going off the gold standard in the 1930s gave the government much more power over money.

00:35:35.660 | Doing deposit insurance for banks actually sort of gave the government a much bigger

00:35:40.780 | role in money.

00:35:41.820 | And I think the central role that government has in money is like the most important thing

00:35:48.620 | both about money today and frankly in thinking about cryptocurrency in the context of, is

00:35:53.700 | it really going to be money?

00:35:54.860 | Are people really in a widespread way going to use crypto to buy and sell stuff?

00:36:01.920 | And I think it's unlikely that governments will relinquish their control over money,

00:36:07.020 | right?

00:36:08.020 | We basically have a monopoly on money now.

00:36:09.940 | And yeah, you can find scattered use cases like ransom or people who want to move money

00:36:17.260 | out of countries like China where there are capital controls, where cryptocurrency has

00:36:23.100 | a clear use case.

00:36:24.580 | It's striking to me how long in a sort of technology standpoint, Bitcoin has now existed,

00:36:31.380 | right?

00:36:32.380 | 2008 was the white paper and I think 2009 was when the first block was minted.

00:36:38.860 | So that's a long time in a certain way for it to not really take off.

00:36:42.380 | I remember I started covering Bitcoin in 2011 and at the time I was like, "Wow, this is

00:36:47.980 | really interesting.

00:36:49.620 | Either it'll work and be this wild new thing or it won't work and it'll kind of go away."

00:36:54.260 | And the surprising thing to me is I was wrong on both of them.

00:36:57.900 | It didn't really work and it totally didn't go away.

00:37:00.660 | It blew up, right?

00:37:01.700 | So I feel like there are a lot of non-monetary potential use cases for stuff on the blockchain,

00:37:10.180 | cryptocurrency/the blockchain.

00:37:11.180 | And I'm kind of surprised that those haven't worked yet, like remittances or even just

00:37:15.540 | payments, right?

00:37:16.540 | Like we pay a lot to credit card companies to pay with a credit card.

00:37:20.460 | We don't see it.

00:37:21.460 | The merchant pays it.

00:37:22.600 | But I would love it if somebody could make something on the blockchain that lowered fees.

00:37:26.940 | People pay a lot to send money home when they go abroad to work.

00:37:29.540 | It would be great if there were just some simple, boring blockchain product that people

00:37:33.180 | used who didn't care about blockchain.

00:37:35.720 | Like that's what I'm waiting for and hoping for and I'm surprised that it hasn't happened

00:37:38.620 | yet.

00:37:39.620 | And do you think it will?

00:37:41.720 | I mean, do you think it will?

00:37:45.300 | When I think about the projects that everyone I know working in this industry are excited

00:37:49.300 | about, it's like generative art, you know, as NFTs and, you know, there's some value

00:37:55.580 | to those projects, but they're not going to necessarily change the cost for someone living

00:38:01.500 | in America to send money to South America or to Europe.

00:38:05.260 | I feel like, you know, if you go people compared to the internet or to the web and like, you

00:38:11.180 | know, there was this moment in the 90s when like the internet was kind of interesting

00:38:15.900 | and weird and people didn't know what to do with it.

00:38:18.380 | And then somebody, it was Hotmail, Hotmail came along, which was the first web-based

00:38:24.340 | email.

00:38:25.340 | And like before web-based email, it was a huge hassle to get your email.

00:38:29.380 | You had to have like a special app on your computer and if you were on a different computer,

00:38:33.060 | you couldn't get your email, if I recall correctly.

00:38:36.220 | And so it was just this obvious killer app that was useful even if you didn't care about

00:38:41.060 | the web per se, it just let you do a thing.

00:38:44.180 | And it wasn't about the technology, it was about the thing it let you do.

00:38:48.060 | And that's all I want out of blockchain.

00:38:51.860 | You know what I mean?

00:38:52.860 | I want something if it's finance, sure, but just have it be financing something in the

00:38:55.860 | real world, right?

00:38:56.860 | Like DeFi just seems to be financing other DeFi, right?

00:39:00.980 | It's just like a Russian doll of people borrowing in crypto to buy more crypto.

00:39:05.260 | Like, I believe that finance can do useful things in the world.

00:39:08.140 | I don't know.

00:39:09.140 | Like, do you think, I mean, when you talk about whatever NFT art projects, like, truly,

00:39:14.980 | what do you think?

00:39:16.060 | I view it as one of the, like a project where I'm like, okay, the entire crypto experience,

00:39:19.980 | I'm like, I don't know what it will become.

00:39:22.060 | I have, there's enough use cases that people talk about.

00:39:24.940 | You mentioned remittance, title insurance.

00:39:26.760 | There's all these things where I'm just waiting for a real project.

00:39:30.180 | I think it's crazy that when you buy a house, you pay a company to-

00:39:34.020 | Title insurance.

00:39:35.020 | It's like an anti-hack, right?

00:39:37.380 | Title insurance.

00:39:38.380 | You just get hosed.

00:39:40.220 | And then someone else pays that insurance the next time they buy the house, and you're

00:39:43.140 | all insuring against the thing that, you know, it's crazy.

00:39:46.340 | So that could be-

00:39:48.020 | Yeah, put my title in the blockchain, please.

00:39:50.980 | You know, please.

00:39:52.940 | But I haven't seen it, but there's so many people, some of the smartest people I've ever

00:39:56.660 | met are all working on different projects, and some of them in, you know, earning yield,

00:40:03.100 | some of them in NFTs, and some of them in crazy other stuff that's still taking shape.

00:40:08.460 | And so I do think there is a future of use cases that we haven't seen.

00:40:15.340 | And I can't remember which podcast it was that I heard Chris Dixon from Andreessen Horowitz

00:40:19.700 | on, and he made a kind of crazy case of, you know, when the App Store came out for the

00:40:23.940 | iPhone, no one really knew what the apps were.

00:40:26.020 | It was like, there were people that were like, "Oh, I want a calculator that can do some

00:40:29.220 | advanced functions," because that's what we were thinking of.

00:40:32.580 | But so many things happened that were out of our wildest dreams, like we couldn't even

00:40:36.740 | come up with them.

00:40:37.980 | And so I believe those things are coming.

00:40:40.700 | I'm just, I've been waiting.

00:40:42.460 | Like you.

00:40:43.800 | It's been a while.

00:40:44.800 | I mean, I will say, I think, when did the iPhone come out?

00:40:47.260 | I think Bitcoin is about as old as the iPhone, right?

00:40:51.540 | So you know, it's certainly taking longer than the App Store did to kind of deliver.

00:40:56.760 | I mean, and whatever, easy for me to say, because I'm not doing the work.

00:41:00.020 | But like you, I mean, you know, in a way the collapse in crypto prices might be useful

00:41:05.680 | because there is so much like scammy noise around crypto that like, it's just obviously

00:41:11.700 | scammy noise that you just kind of want to wave it all away.

00:41:15.660 | And maybe the crash will sort of wash out the scammy noise to some extent and leave

00:41:20.460 | the people who are actually working in good faith on potentially useful projects.

00:41:25.780 | And I think there are a lot of those people.

00:41:27.420 | And I don't know how to pick the winners right in right now when I think of it as a to bet

00:41:32.340 | on it.

00:41:33.340 | You know, there was, there's not a way easily to bet on mobile, I guess you could buy some

00:41:37.460 | Apple stock or some Google stock.

00:41:38.940 | It's like here, I like that the ability to bet on a fundamental piece of technology is

00:41:44.340 | a little bit more accessible.

00:41:45.900 | You could probably assume that maybe, is it?

00:41:48.620 | I don't know.

00:41:49.620 | I mean, you think not accessible, at least with, well, at least with the stock market,

00:41:53.040 | you have like a stream of revenues.

00:41:54.540 | You have a way to value it, right?

00:41:56.220 | You can do sort of fundamental valuation, right?

00:41:58.540 | Like you could have bet on mobile 10 years ago, whereas if you're buying, I mean, you

00:42:02.460 | can buy tokens.

00:42:03.460 | I get the logic of buying tokens, but the, but how to value them, Oh, seems very hard.

00:42:09.220 | I'm not trying to convince you that it's not a speculative asset, right?

00:42:12.380 | It definitely, and most certainly is, but like, what is the right price, right?

00:42:17.340 | And like, what is the right, like, there's no, I don't know of any, I mean, people with

00:42:22.540 | Bitcoin are like, well, it's like gold and the, you know, the sort of total value of

00:42:25.720 | gold is much larger than the total value of Bitcoin.

00:42:28.300 | But that's kind of a different thing than what we're talking about.

00:42:31.020 | Yeah.

00:42:32.020 | I think, I think it's cool that there's something happening and it's exciting and there's a

00:42:36.180 | way to put a small amount of money into it and see what happens.

00:42:40.020 | Yeah.

00:42:41.020 | It's like a trip to the casino with that's like maybe more intellectually interesting

00:42:44.900 | than going to the casino.

00:42:46.380 | Yeah.

00:42:47.380 | Now that we both share a common story that in sometime almost a decade ago, for me, it

00:42:54.940 | was, I had some Bitcoin and I've, I made a purchase where I was looking online and I

00:42:59.900 | was like really into fantasy football.

00:43:01.420 | I was really into fantasy football for a few years.

00:43:04.140 | And there was this site that I'm not going to say I understood whether it was legitimate

00:43:08.820 | or not, but you could get access to stream all the football games of the season for the

00:43:14.340 | low price of like a Bitcoin or something.

00:43:16.820 | You know, it was like maybe it was, I think you understood that this was not legitimate,

00:43:20.740 | but let's keep going.

00:43:23.500 | And I remember thinking, gosh, you know, it would be way more expensive paying for NFL

00:43:27.260 | Sunday ticket because that's like $300 and you got to get direct TV looking back.

00:43:33.540 | You know, it was probably like a $10,000 subscription to watch, you know, 16 or 20 games during

00:43:40.100 | a season.

00:43:41.420 | I know you also bought a sandwich that probably, you know, maybe as a $10,000 sandwich, maybe

00:43:47.060 | more.

00:43:48.060 | Yeah, more.

00:43:49.060 | Me and another reporter, David Kessenbaum and I went, we bought falafel and like a smoothie.

00:43:53.460 | And this was when Bitcoin was like, I don't know, 20, $20 for one Bitcoin, you know?

00:43:59.500 | And so, yeah, I mean, well, it's cheaper now than it was six months ago, right?

00:44:04.860 | Six months ago, it was a $50,000 lunch and now it's a $20,000 lunch.

00:44:08.680 | So if it keeps going, maybe it'll get back to normal.

00:44:10.900 | I mean, that does to your earlier question about, you know, money and crypto, like money

00:44:18.780 | doesn't work that way.

00:44:20.820 | You don't regret buying a sandwich because the value of money, you know, it actually

00:44:27.140 | appreciated so much.

00:44:28.860 | Like you don't hodl money.

00:44:30.060 | It doesn't make sense.

00:44:31.260 | That's not what money is for.

00:44:32.940 | And so, you know, on a simple level, it demonstrates the extent to which certainly Bitcoin is not

00:44:42.460 | money.

00:44:43.460 | And I think the closest thing to money in crypto, sort of ironically, given the history,

00:44:47.380 | is stable coins, right?

00:44:49.540 | Which is funny given that like so much of the sort of crypto noise is about the unreliability

00:44:53.740 | of the dollar, that the thing that actually functions like money is the thing that is

00:44:57.300 | pegged to the dollar.

00:44:58.780 | OK, so we don't have to go too crazy on crypto.

00:45:02.260 | But what do you think about institutions like Fidelity saying, oh, we're going to let people

00:45:06.960 | put crypto in their 401k and kind of starting to try to treat it as a mainstream investment?

00:45:12.900 | Yeah.

00:45:13.900 | I mean, I guess the underlying question there is a question about sort of paternalism, really,

00:45:20.300 | right?

00:45:21.300 | Like, I mean, if some friend of mine or family member said, should I buy Bitcoin?

00:45:25.980 | I would say don't invest what you can't lose, right?

00:45:29.280 | Like if you want to make a little side bet, that's fine.

00:45:31.660 | But like the S&P 500 is a much safer bet for the long run, is what I would say.

00:45:36.740 | Whether Fidelity should let people is a weird question, right?

00:45:39.420 | Because it's like, I guess ultimately it's OK with me.

00:45:42.860 | I'm not comfortable being that paternalistic.

00:45:44.780 | I'm not comfortable saying to people, I know better than you and I don't think you should

00:45:48.580 | be allowed to do this.

00:45:50.740 | But I mean, if somebody asked me for advice, I would say don't put much money in it.

00:45:54.780 | So to get back to the book, at the end, you had this conclusion section of the future

00:46:00.340 | of money and you had these three possibilities.

00:46:03.460 | And sure, there are more, but I loved the three, which was a world without cash, a world

00:46:08.420 | without banks, and a world that sounds like the world you described in the past, which

00:46:13.500 | was the government's going to kind of manage it all and print money and give it to anyone

00:46:17.660 | who wants a job.

00:46:20.100 | Is one of those a world where you actually think this is where we're going?

00:46:23.180 | So the world without cash is probably the most reasonable of those, right?

00:46:29.240 | It certainly feels like cash is going away.

00:46:32.660 | I mean, there are a couple of things to say about that, though.

00:46:36.420 | One is, in fact, cash is not going away.

00:46:39.580 | In fact, there is more cash than there has ever been, despite what it feels like.

00:46:43.820 | There's an extraordinary amount of cash in the world now.

00:46:46.660 | You know, when I wrote the book, it was something like 40, four, zero, hundred dollar bills

00:46:52.680 | for every man, woman, and child in America, which is just astonishing when you think about

00:46:58.100 | it, right?

00:47:00.160 | More hundred dollar bills than one dollar bills.

00:47:02.780 | And so then there's the question of like, where is it, right?

00:47:06.980 | Where are all those hundreds?

00:47:08.860 | And the awesome answer is we don't exactly know because it's cash and kind of the whole

00:47:13.060 | point of cash, certainly the whole point of hundreds, let's be honest, is it's like nobody

00:47:17.880 | knows where it is.

00:47:18.880 | It's not tracked.

00:47:21.100 | You know, it's pretty clear that a lot of it is outside the United States, right?

00:47:25.220 | In a lot of countries where the banks are unreliable, where the currency is unreliable,

00:47:28.860 | people like U.S. paper money as a store of value, as a real store of value.

00:47:35.020 | So that seems useful and it's like a good export for the U.S., right?

00:47:38.440 | People want to give us stuff and we give them paper, like that's a good deal.

00:47:41.980 | So crime, right?

00:47:43.180 | Like people just use paper money to commit crimes a lot.

00:47:46.400 | There was this story that came out after I wrote the book.

00:47:48.300 | It was at the beginning of the pandemic when all the stores shut down.

00:47:53.100 | And in L.A., in Southern California, the DEA just started seizing these vast sums of cash.

00:47:59.780 | And what had happened was the drug dealers in L.A. were using these stores to launder

00:48:05.040 | their money.

00:48:06.040 | And when the stores shut down, they couldn't launder their money anymore.

00:48:08.500 | So the money was just like piling up and they just had all this cash that they couldn't

00:48:12.940 | hide anymore.

00:48:15.820 | So that is still going to happen.

00:48:20.440 | The other piece of it is money is largely already digital.

00:48:25.020 | If cash goes away, I mean, there are certain people, like people don't have access to bank

00:48:29.300 | accounts.

00:48:30.300 | And so you would definitely want to create a system to basically give those people bank

00:48:34.300 | accounts, give everybody a bank account, give everybody a debit card.

00:48:38.860 | That's solvable.

00:48:40.360 | The key thing is our money is already mostly digital, right?

00:48:43.980 | Even though I think if people sort of close their eyes and think about money, they'd think

00:48:46.920 | about a $20 bill or a $100 bill, the vast majority of money in the world is just a number

00:48:51.020 | on a bank's computer, right?

00:48:53.580 | So if cash goes away, the world wouldn't look that different.

00:48:56.780 | I think there's a, I don't know how much, but there's a decent amount of our economy

00:49:01.960 | that happens with cash, people that get paid in cash don't pay taxes again, which maybe

00:49:06.040 | isn't good that that happens, but yeah, no, you're right, you're right.

00:49:11.540 | There was this famous moment in Italy when they decided to start including in GDP and

00:49:19.220 | the measure of their overall economy, the black market, the illegal economy.

00:49:24.140 | And because of the nature of the Italian economy, their GDP grew a ton when they decided to

00:49:30.020 | start counting it.

00:49:31.020 | They passed, I think they passed to the UK, they became a bigger economy than the UK and

00:49:34.840 | they had like a celebration.

00:49:36.180 | They called it il sorpasso because like, "Hey, we're bigger than the UK," which is fun.

00:49:42.020 | How did they account for it?

00:49:43.780 | Yeah, I don't know.

00:49:44.780 | Oh, okay.

00:49:45.780 | What's funny, my fun moment was I had a tenant and we had an Airbnb and we were talking about

00:49:52.460 | the U.S. economy, he was from Germany and we talked about cash and he was like, "Oh,

00:49:56.780 | do you want me to pay you with cash?

00:49:58.420 | Is it okay if I send it electronically?

00:50:00.140 | Do you take credit card?"

00:50:01.140 | We were talking about it and he's like, "Because in Germany, you know, we say that cash is

00:50:05.620 | tax neutral."

00:50:06.620 | And I thought that was the best description of cash I'd heard to date.

00:50:13.180 | Cash neutral is funny.

00:50:14.360 | I mean, arguably it's cash, it's tax, tax neutral is funny.

00:50:19.780 | Arguably it's tax negative, right?

00:50:22.780 | Like if in the proper world, you're paying the tax and then you pay in cash, you don't

00:50:26.540 | have to pay the...

00:50:27.540 | Oh, yeah.

00:50:28.540 | It depends on what your baseline is.

00:50:30.460 | Yeah.

00:50:31.460 | So it's good that you've learned a lot about money.

00:50:33.580 | You've researched it, talked about it, run a podcast for over a decade.

00:50:38.020 | But I saw you say that before you started thinking about money, you didn't really think

00:50:42.380 | about it that seriously.

00:50:43.380 | It became this thing that you're now known for.

00:50:47.260 | And now that you have a family and kids, I'm curious what kinds of money-related lessons

00:50:51.940 | or thoughts you're trying to pass on so that they have a better understanding earlier on

00:50:59.100 | than maybe you did.

00:51:00.100 | Yeah.

00:51:01.100 | That's a good question.

00:51:02.100 | I mean, you know, the way I thought about money before I started studying it and writing

00:51:09.340 | about it was I was always really into saving money and not spending money.

00:51:16.260 | I, you know, I, yeah, just the way I was raised or my personality is like, I like a deal,

00:51:23.020 | I think twice before I buy things.

00:51:25.700 | And it's interesting, you know, you ask about my kids.

00:51:29.300 | And so a thing I think a lot about with them is what's the right balance?

00:51:35.100 | Like I think I was sort of neurotically cheap to some extent, or in some settings, like

00:51:41.780 | the way I thought about money, like, but at the same time, like, I'm glad that I, you

00:51:46.140 | know, know the value of a dollar, right?

00:51:48.020 | And don't take for granted buying stuff.

00:51:51.220 | And so what I'm trying to teach or model for my kids, because the modeling is the real

00:51:57.780 | thing, right?

00:51:58.780 | With kids, what you do is really what matters.

00:52:01.740 | So what I'm trying to model for them is some happy medium, right?

00:52:06.180 | Like A, recognizing that we're fortunate to just be okay and not have to worry about buying

00:52:11.580 | food and paying the rent.

00:52:12.580 | Like, that's a big one, right?

00:52:13.900 | Like, don't take that for granted, we're lucky.

00:52:16.340 | Two, like, it's okay to buy yourself something nice.

00:52:19.740 | But remember, like, if you buy this thing, you're going to have less money and less ability

00:52:23.740 | to buy something else in the future.

00:52:25.060 | So is it worth it to you, right?

00:52:27.180 | It's that that idea, that idea of value.

00:52:30.780 | That's really what I want to teach my kids.

00:52:33.260 | And how are you modeling those two things?

00:52:35.540 | Well, it's hard.

00:52:36.780 | I mean, I'm trying to be like thoughtful about money, but not neurotic, right?

00:52:41.020 | Like, I'm just trying to be the, like, money person I aspire to be in my behavior in front

00:52:46.900 | of them.

00:52:47.900 | Do you talk about, "Oh, we're going to make this decision.

00:52:50.900 | You mentioned you got to buy a house.

00:52:51.900 | Did you?"

00:52:52.900 | I don't know.

00:52:53.900 | I don't know how old your kids are.

00:52:54.900 | So maybe that's too much.

00:52:55.900 | They're, you know, 9 and 11.

00:52:57.580 | We did talk about, I mean, I explained to them the mortgage, you know, I explained to

00:53:00.500 | them how a mortgage worked.

00:53:01.500 | And for that matter, we had, we lived in an apartment before and we had a mortgage.

00:53:04.540 | And I explained to them, they're curious, smart kids, you know?

00:53:07.360 | And so I explained to them, like, "We're going to sell the house and we're going to get money.

00:53:11.200 | And we're going to use that money to pay off the bank for this mortgage.

00:53:14.160 | And then we're going to have some leftover.

00:53:15.160 | And we're going to use that to buy some of the house that we're buying, and we're going

00:53:17.560 | to get a loan."

00:53:18.560 | Like, they were into the mechanics of it.

00:53:20.180 | And we talked a lot about it.

00:53:21.440 | So like, that part is just fun.

00:53:23.400 | Like, I'm a nerd.

00:53:24.640 | My kids are kind of nerds.

00:53:26.060 | And so the, like, the mechanics part, to me, that's like the fun, easy part.

00:53:30.560 | The more, certainly the harder and maybe more interesting, ultimately, a part is the more

00:53:35.480 | emotional, frankly, more emotional part.

00:53:38.520 | Because like, rationally, like, I save a lot of money and, you know, I'm fine.

00:53:44.600 | We're fortunate and I work and my wife works and whatever.

00:53:47.560 | But you know, as you know, there's a large emotional component to money.

00:53:51.760 | And managing that and being reasonable about money, that I find hard at some level.

00:54:00.400 | And I think the hardest thing, there's an unlimited number of studies that show that

00:54:05.040 | people who have money would think they will be happier if they have more money.

00:54:08.120 | Which I think is probably the hardest emotional thing to solve.

00:54:13.120 | You know, whether it's keeping up with the Joneses or the hedonic treadmill or whatever

00:54:16.100 | name you want to give it.

00:54:18.000 | I have not found someone give any kind of, "Here is exactly how you fix that."

00:54:23.520 | You know, the answer has been, you know, you just have to accept that what you have is

00:54:26.720 | enough.

00:54:27.720 | And maybe it's gratitude.

00:54:28.720 | Or is there anything you've picked up in all the episodes you've done or conversations

00:54:33.240 | you've had that would help someone kind of get out of that rut of kind of always thinking

00:54:38.880 | more would be better and not being content with what they have now?

00:54:42.520 | At a broader level, and this might be too broad, but a thing I have found in my, just

00:54:48.540 | in my life, frankly, more than in my work, is that I'll have some emotion about money

00:54:54.080 | or about work or something.

00:54:55.560 | Some worry.

00:54:56.560 | I worry a lot, whatever.

00:54:58.800 | And then I'll go for a jog.

00:55:00.920 | I like to jog.

00:55:01.920 | I think that exercising just makes me less worried.

00:55:04.400 | And I'll feel better.

00:55:05.400 | Right?

00:55:06.400 | I'll stop worrying about the thing I was worried about.

00:55:07.400 | But the thing hasn't changed at all.

00:55:09.160 | The money situation in my life or the thing at work or whatever I was worried about.

00:55:12.660 | And so like for me, a big insight of adulthood has been my emotions are more about what's

00:55:19.160 | going on inside of me than about what's going on out in the world.

00:55:22.680 | Right?

00:55:23.680 | So to me, the key thing to worry less is to not fix something external, I mean, unless

00:55:28.840 | you have some horrible thing in your life.

00:55:30.320 | But I unfortunately don't have horrible things in my life.

00:55:32.880 | It's to manage myself.

00:55:34.120 | It's to run.

00:55:35.120 | It's to whatever.

00:55:36.120 | Sleep if you need to sleep.

00:55:37.120 | Take a break if you need to take a break.

00:55:38.840 | It's recognizing that the source of a lot of problems, a lot of worry, is internal.

00:55:43.640 | Interesting.

00:55:44.640 | My answer would have been something that I don't think contradicts what you said, but

00:55:49.040 | complements it on the other side, which is a lot of the source, I think, of people's

00:55:54.400 | struggles with money are thinking that most people have more than them, which I actually

00:55:58.720 | think is not true.

00:56:00.720 | And so my challenge to people is if you're feeling like you can't keep up with the Joneses

00:56:06.280 | per se, try to just talk about money.

00:56:09.200 | It's like the most uncomfortable thing, and I don't know if people will, but I imagine

00:56:13.320 | the person on Instagram who posted a photo in a Greek island that you're jealous of,

00:56:20.360 | talk to them about money, and they might say, "Gosh, we're still struggling to pay off our

00:56:23.480 | student loans."

00:56:24.480 | And you're like, "Oh, wow."

00:56:26.640 | They're not posting their student loans on Instagram.

00:56:29.760 | They're not posting the credit card payment they missed.

00:56:32.800 | And so your example is think inward, and mine is a complimentary one, which is talk to the

00:56:39.840 | people that you aspire to be like, and you might find out you're a lot more like them,

00:56:44.120 | or you might even be better off.

00:56:46.000 | They just might be making you look like you're not better off because all you see...

00:56:50.720 | Stay off Instagram also, right?

00:56:52.680 | Instagram is a vehicle for that.

00:56:53.880 | I mean, you know, one word that's interesting to talk about in this context, I think it's

00:56:58.720 | under-discussed in the context of money and other things, is status, right?

00:57:02.360 | A lot of the time, I mean, obviously money and status are closely linked.

00:57:08.840 | And sometimes what people will articulate as a worry about having enough or whatever

00:57:15.520 | is actually a worry about status, a worry about, "Oh, I am lower status than this person

00:57:21.120 | who went to Greece," or whatever, right?

00:57:23.040 | And I don't know exactly what to do about that, right?

00:57:26.840 | In my dream world, it was like, "Don't care about status."

00:57:29.840 | But I haven't been able to not care about status, candidly, right?

00:57:32.920 | We're hierarchical animals.

00:57:34.120 | It's very hard to not care about status.

00:57:36.160 | But I think to at least be aware of it and be aware of what status games do you want

00:57:42.200 | to play?

00:57:43.200 | What status games can you get out of playing?

00:57:45.320 | Whether that's at work or with respect to material things or the kind of car you have

00:57:49.640 | or whatever, just an awareness that a lot of what we think of as like, "Oh, I need this

00:57:54.600 | or I need that, or I'm worried that I'm not going to have enough money," is really a kind

00:57:58.680 | of status hierarchy, primate brain doing weird things in the way we think about money.

00:58:05.760 | That I also find helpful.

00:58:06.760 | If there's a person that I could think of that might have some suggestions, and I will

00:58:10.840 | take it as homework to bring them on the show in the future, is Ryan Holiday, who talks

00:58:16.400 | a lot about stoicism, I think if I were going to try to solve that with a conversation,

00:58:21.520 | I feel like he would be the best kind of sparring partner for that.

00:58:25.000 | So I will send you a note when he comes on, which if anyone listening is like, "I'm buddy,"

00:58:31.080 | send him a note.

00:58:32.080 | I don't know Ryan, but I will find my way to him and encourage him.

00:58:35.760 | I mean, that guy does a ton of stuff.

00:58:38.280 | I bet you could get him on the show.

00:58:40.560 | Before we wrap, I have a couple of things.

00:58:41.760 | You said you're a nerd about money.

00:58:43.200 | You love a deal.

00:58:44.440 | You love saving.

00:58:46.320 | In our first conversation, before we hit the record, I know you've said you've got some

00:58:49.560 | hacks for money.

00:58:50.560 | I'd love to hear, what are the things that you do that you often find your friends or

00:58:55.560 | peers or colleagues being like, "Oh, that's great.

00:58:58.360 | I got to start doing that," other than the I-bonds, which we'll go down as the main one

00:59:02.880 | for the episode?

00:59:03.880 | Oh, I mean, yeah, that's the big one.

00:59:07.160 | Everything else is so small and goes more to the neurotic side.

00:59:10.360 | It's like the stuff where I don't actually save that much money in the big picture.

00:59:14.400 | I just like the feeling of getting a deal.

00:59:16.200 | Do you know the website Auto Slash?

00:59:19.000 | This is a weird one, but there's a website called Auto Slash.

00:59:21.840 | I just bought a car for the first time a couple of years ago.

00:59:23.840 | I live in New York where you can get around without a car.

00:59:26.960 | Before the pandemic, I didn't have a car until we would rent cars pretty often, if we're

00:59:30.240 | going to go away for the weekend or whatever.

00:59:31.920 | Renting a car in New York is really expensive.

00:59:34.400 | There's this weird website called Auto Slash where you just type in where you want to rent

00:59:39.440 | a car and whatever, who you are, what kind of car you want to rent.

00:59:44.200 | If you're a member of Costco or the AAA or if you have this credit card or that credit

00:59:47.520 | card.

00:59:48.520 | Then the weird thing about it is it's not instant, but like, I don't know, an hour later

00:59:54.520 | they email you rental car deals and they tend to be really good deals.

01:00:01.700 | In New York, it's like the difference between 100 or 150 bucks a day and like 25 bucks a

01:00:07.000 | day for a rental car sometimes.

01:00:08.800 | It's like a big deal.

01:00:10.800 | That one, I don't know.

01:00:11.800 | Is that too little?

01:00:12.800 | Is that the wrong size hack?

01:00:14.600 | I think I would say no, because the CEO of Auto Slash, Jonathan Weinberg, is actually

01:00:18.400 | we're recording episode next week all about rental cars.

01:00:21.400 | Okay.

01:00:22.400 | Well, you're welcome, Jonathan.

01:00:23.400 | You just teed that up perfectly.

01:00:25.880 | But yeah, I think rental cars, especially right now, there's no supply of cars in the

01:00:30.880 | market.

01:00:31.880 | I noticed when we ordered our Tesla, they said it's going to come in April.

01:00:36.080 | We had our second child in June, car hadn't come.

01:00:40.720 | Car said in the app, it's coming in July.

01:00:43.040 | We were like, we can manage for a month in a car that doesn't fit everyone.

01:00:47.560 | That's okay.

01:00:48.560 | And then it said, okay, it's got pushed back.

01:00:50.680 | It's no longer July.

01:00:52.160 | It's going to be somewhere between December and next April.

01:00:55.140 | And we were like, so I called Tesla, I was like, what is going on?

01:00:58.840 | And they're like, ah, you know, it's normal that the dates shift like that.

01:01:01.120 | I was like, what do you mean?

01:01:02.120 | What do you mean?

01:01:03.120 | It's normal that the dates shift by six months?

01:01:04.920 | It's normal that you go buy a car and drive home.

01:01:08.000 | That's what's normal, Tesla.

01:01:09.760 | And then a week later it shifted back and it said, ah, this is the thing that I thought

01:01:14.400 | was so crazy.

01:01:15.400 | It said August 11th to October 12th.

01:01:18.920 | And I was like, okay, I guess it's normal that it shifts by six months.

01:01:22.880 | And then the next week it said August 12th to October 13th.

01:01:26.520 | And I was like, how could a company have enough precision to change my delivery estimate by

01:01:32.000 | a day when two weeks prior it was six.

01:01:35.120 | But the window is still two months, right?

01:01:37.120 | We know it won't be August 12th anymore.

01:01:38.720 | It's still a big window, but we're shifting it by 2%.

01:01:41.320 | Yeah, well, the hack for this, though, that I learned, which I didn't want to share until

01:01:46.680 | I got the car right now, I don't care is that when Tesla has a car that is ready for pickup,

01:01:52.720 | they email someone say, hey, your car's here.

01:01:55.200 | And if in three days you're not ready for it, they put it to someone else.

01:01:59.960 | And so can you like fly standby with Tesla?

01:02:02.600 | Can you get on the I want to be on the someone else list?

01:02:05.860 | So I wouldn't say it's like accepted, but it's also maybe not like prevented.

01:02:10.380 | This is this is the hack.

01:02:11.620 | This is the perfect hack window.

01:02:13.300 | Yes.

01:02:14.300 | So if you go not to the showroom, but the delivery center.

01:02:17.120 | So in every major area, there's a delivery center in the Bay Area.

01:02:19.960 | It's in Colma.

01:02:21.680 | And you know, I would say for a cemetery, yeah, I know.

01:02:26.240 | I would say, you know, it, it helps if you genuinely have a need.

01:02:29.640 | We went in, we're like, our family doesn't fit in the car we have today.

01:02:34.040 | But we would like it.

01:02:36.480 | People are willing to make an exception.

01:02:38.060 | If you're flexible, you're like, we will change the color.

01:02:42.040 | That's fine.

01:02:43.720 | We found someone and they said, look, if a car shows up and no one wants it after two

01:02:48.720 | and a half days, you know, or if we get a verbal confirmation that they don't want it,

01:02:53.640 | we'll give you a call because they want to get the car off the lot.

01:02:55.760 | And if they if they know someone that's going to come right away, it's helpful.

01:02:59.640 | I think they're supposed to put it back in the queue and give it to the next person in

01:03:02.720 | line.

01:03:03.720 | But, you know, every now and what we ended up getting was a car that came in six months

01:03:09.760 | ago and had something wrong with the door.

01:03:12.840 | And because they prioritize people who own cars, they prioritize fixing their cars.

01:03:17.320 | This car just sat there for, you know, four or five months before they fix the door.

01:03:21.200 | And now it's technically a twenty twenty one and the new cars are twenty twenty twos.

01:03:25.280 | So they kept calling people and saying, hey, you're twenty twenty twos here.

01:03:28.160 | It's actually last year's model.

01:03:30.080 | Nothing changed.

01:03:31.080 | They changed like the charge port is slightly different and that's it.

01:03:35.080 | And for anyone listening who's a huge nerd, they also added this like swiveling screen

01:03:39.240 | that's motorized, but it didn't matter to us.

01:03:41.440 | So they're like, gosh, here's a person that said I will take it.

01:03:44.560 | Let's stop calling people that keep saying no and give it to that person.

01:03:47.800 | You just so you just got it now.

01:03:49.720 | You got it in June instead of August to October and your whole family fits in it.

01:03:54.240 | We got it yesterday.

01:03:55.240 | I spent yesterday afternoon like putting two car seats in there and getting it all ready.

01:04:00.000 | But yeah, it's a one day old car with a one point nine nine percent loan that I'm excited

01:04:05.400 | about.

01:04:06.400 | That's a good hack.

01:04:07.400 | What else you got?

01:04:08.400 | I hit really hard the filters on like kayak, like really hard kayak trip advisor, you know,

01:04:16.800 | in the like left rail on kayak.

01:04:18.800 | You can do all kinds of dialing, right?

01:04:21.080 | Like so I live in New York, for example, and there's multiple airports, which is helpful.

01:04:26.200 | But you know, you can turn on and off like I'm big at just like pricing different things,

01:04:31.560 | right?

01:04:32.560 | Like there is some price for which I'd be willing to fly on Spirit Airlines, but it's

01:04:37.680 | typically not the price, you know, some price differential.

01:04:41.120 | There's some amount of price differential that makes it worth it depends on am I flying

01:04:44.700 | with my kids and it's going to be a lot, lot more right.

01:04:47.560 | On the other hand, the thing about flying with kids, as you know, is like everything

01:04:50.800 | is suddenly 4X.

01:04:52.760 | Here's one.

01:04:53.760 | Okay.

01:04:54.760 | Here's a hack.

01:04:55.760 | I don't know if it's a hack.

01:04:56.760 | I find it useful as a hack.

01:04:57.760 | If there's some recurring thing you pay for, whether it's, you know, a monthly bill is

01:05:00.920 | easy, but even like a thing you buy at the grocery store every week, annualize it, right?

01:05:06.080 | So if there's something, if you're spending an extra 10 bucks a week at the grocery store

01:05:10.720 | on something, something's 10 bucks more than the other thing, that's actually 500 bucks

01:05:15.520 | a year, right?

01:05:17.080 | And I find saying, is this worth an extra 500 bucks a year to me feels different than

01:05:21.360 | is this worth an extra 10 bucks to me every time.

01:05:23.760 | So like that's a sort of behavioral hack, right?

01:05:26.400 | It's a way of framing things that helps me spend less, frankly.

01:05:30.600 | And same with subscriptions, obviously subscriptions are killer that way.

01:05:35.240 | I haven't signed up for, do you use, you know, there are those products now, there are a

01:05:39.040 | subscription product to manage your subscription products.

01:05:42.480 | And I've, I've been interested in those because I have so many now, like for software, like

01:05:46.200 | I have, you know, Microsoft and Adobe and Dropbox and all these ones that like, I don't

01:05:51.120 | use that much.

01:05:52.480 | And they are, you know, altogether, certainly hundreds, maybe $1,000 a year, right?

01:05:59.920 | I could use a hack on that one, I think.

01:06:01.600 | Can you help me?

01:06:02.600 | So Truebill is a sponsor of the show, and as people know, no, no, no, that I didn't

01:06:07.920 | ask you to.

01:06:08.920 | You're welcome.

01:06:09.920 | You're welcome.

01:06:10.920 | Truebill.

01:06:11.920 | I, I vet all the products that services anyone that wants to sponsor the show.

01:06:15.200 | I'm like, I am very serious.

01:06:16.880 | I'm like, I'm going to use the product.

01:06:18.520 | I'm going to try the product.

01:06:19.520 | My wife will try the product.

01:06:21.120 | And I say no to most of them.

01:06:23.200 | So I downloaded Truebill.

01:06:24.200 | I'd never used it before.

01:06:25.960 | And you know, I get, they're getting a free ad here that it's not part of the ad, but

01:06:30.120 | basically what you can do is you can see a calendar of when all your subscriptions are,

01:06:34.020 | where they are, even just the free version of, of not hiring them to do anything.

01:06:38.120 | And it's just, what are they all?

01:06:39.540 | And that's free.

01:06:40.540 | Because there's so many, there's so many, and they recur.

01:06:44.100 | And like, I mean, there's the simple things of like right when you sign up, you know,

01:06:48.880 | make sure it's not automatically recurring.

01:06:51.600 | Like that's a useful one.

01:06:52.800 | There's so many, like very often I'll get an email that's like, Hey, thanks for renewing

01:06:56.560 | your subscription for another year.

01:06:58.120 | We just billed you 90 bucks.

01:06:59.720 | I'm like, ah, um, one, a great one.

01:07:02.840 | I'll give you two, two ones for this.

01:07:04.720 | So one is if you have a capital one card, they have this browser extension called Eno.

01:07:11.680 | And I dislike the fact that they have hijacked a keyboard shortcut that I used for something

01:07:17.440 | else.

01:07:18.440 | But other than that, what they do is they give you a virtual card for everything.

01:07:21.860 | So you install this browser extension and a lot of the virtual card companies like privacy

01:07:26.680 | is an example.

01:07:27.960 | They route your money through your bank account.

01:07:30.900 | You don't earn points.

01:07:32.120 | I don't love it.

01:07:33.120 | I like the points.

01:07:34.120 | But, but the advantage is it doesn't automatically renew, right?

01:07:37.400 | It's sort of self-destruct.

01:07:38.400 | So they can't bill you again.

01:07:40.520 | That's the advantage of it.

01:07:41.520 | Right.

01:07:42.520 | So because this one's tied to capital one, the card issuer, you still earn all your rewards,

01:07:46.880 | but you can say that this card, yeah, for this card, I want to only allow a purchase

01:07:52.920 | of a hundred dollars and then, or I want to go manually turn it off.

01:07:56.520 | So I want to buy a subscription.

01:07:58.320 | It's a one-year thing.

01:07:59.320 | They don't have the ability to cancel it.

01:08:01.440 | Maybe you have to call to cancel.

01:08:02.840 | I just buy it and immediately turn off the billing for that card.

01:08:07.140 | And the great thing is it's just not going to go through.

01:08:09.680 | They're going to say, Hey, we had to cancel your subscription.

01:08:11.840 | Now True Bill does have a feature where you could say, Hey, just call them for me and

01:08:15.200 | cancel it.

01:08:16.200 | And like that, that is a part of their, their premium subscription.

01:08:19.560 | They'll just do all that for you.

01:08:20.940 | But I like to use capital one's thing because you still get the points, but they will go

01:08:24.480 | in and cancel, cancel the thing.

01:08:26.360 | And it just happens that I use my capital one card for a lot of internet stuff.

01:08:29.920 | Cause it's the like two X on everything, not the, you know, travel bonuses and grocery

01:08:35.960 | bonus.

01:08:37.320 | You got any travel hacks for me?

01:08:39.340 | And here's the thing for me with travel hacks is like, again, because I have kids, like

01:08:44.520 | I'm definitely in the like schmuck category now where I have to go at the time when everybody

01:08:49.320 | goes, I have to fly the weekend.

01:08:50.680 | You don't want to have to fly.

01:08:52.080 | Right.

01:08:53.080 | So I'm starting in a bad place, right?

01:08:56.040 | I'm starting where I'm the guy who has to pay retail for the seat.

01:08:59.440 | And I don't want to be that guy.

01:09:00.640 | What can you do for me?

01:09:02.160 | I mean, going back and listening to a handful of episodes is probably not the best answer

01:09:05.400 | for you.

01:09:06.400 | Like I'll probably cut that.

01:09:08.500 | Maybe I won't.

01:09:09.500 | Maybe I won't.

01:09:10.500 | The best answer is you should have been listening to the podcast.

01:09:12.820 | We've got a handful of episodes that tackle this.

01:09:16.220 | The hard answer is.

01:09:18.540 | I sometimes think that if you have the points, things open up last minute.

01:09:22.820 | So it's like the scary option, which is if you can find something, you know, I'll sometimes

01:09:28.300 | buy the Southwest flight that I can cancel last minute, pay for a refundable fare, and

01:09:34.140 | then keep looking for the for the last minute deal.

01:09:37.600 | Yeah.

01:09:38.600 | And most of the airlines now are refundable.

01:09:39.600 | So or not refundable, sorry, cancelable, and you get a full credit, but you don't have

01:09:43.360 | to pay a fee.

01:09:44.680 | So if you book with an airline where, you know, I fly Delta all the time.

01:09:48.880 | If I have to cancel this and get a 500 dollar Delta credit, it's going to be OK.

01:09:52.680 | Buy the ticket.

01:09:53.680 | This is something I'd like to buy the ticket and then make the barrier having to cancel

01:09:58.680 | to when you get a better deal instead of holding off and making the action.

01:10:03.060 | I have to go buy it.

01:10:04.640 | And so I say buy it and then check in regularly as late as the day of or the night before.

01:10:11.820 | A lot of times within the last week, tickets are really, really inexpensive with points.

01:10:17.760 | My wife's family wants to come visit because we had the new baby and they're coming next

01:10:22.800 | week, like within five days.

01:10:25.240 | And we looked on United and they live in Steamboat Springs, Colorado, which is notoriously an

01:10:31.240 | expensive place to fly to because it's just United and Southwest.

01:10:35.100 | And they route through Denver and they have a monopoly over the airports.

01:10:39.400 | And it was so cheap for points.

01:10:41.440 | It was like the lowest inventory, 12000 points each way or 12.5 for a ticket that was like

01:10:46.920 | six or seven hundred dollars.

01:10:49.040 | So it ended up being a fantastic deal because they booked within a week.

01:10:52.600 | What they could have done is bought a Southwest ticket a month ago, canceled it if they needed

01:10:56.720 | to.

01:10:57.720 | Yeah, sure.

01:10:58.720 | I also want to talk about the podcast.

01:11:00.040 | I mentioned it in the intro, but you started a new podcast after being in this space longer

01:11:05.600 | than most.

01:11:07.000 | What led you to this topic?

01:11:08.640 | Yeah.

01:11:09.640 | So I started this show called What's Your Problem?

01:11:12.120 | And it's really a show about people solving technical problems in the real world.

01:11:18.280 | Right.

01:11:19.280 | I talked to, you know, engineers and founders of, you know, companies that are doing things

01:11:24.000 | that seem interesting and important to me.

01:11:25.960 | You know, drone delivery, self-driving cars, but also events markets.

01:11:32.440 | I just interviewed somebody who started the first company that was approved by the CFTC

01:11:36.840 | to let people bet on real world events.

01:11:38.840 | That's an interesting one.

01:11:42.240 | And you know, what led me to start it was, I mean, it just seemed fun to start something,

01:11:46.720 | frankly.

01:11:47.720 | Right.

01:11:48.720 | But I think that sort of the big idea that I got excited about when I started learning

01:11:52.640 | about economics, which didn't happen until relatively late in my life, was this idea

01:11:57.280 | that the pie can get bigger, that everybody can be better off, that the world is not fundamentally

01:12:02.840 | a zero-sum game.

01:12:03.840 | Right.

01:12:04.840 | I feel like that is actually the big insight of economics.

01:12:08.160 | And I didn't know it before.

01:12:10.600 | And I think it's not intuitive, right?

01:12:12.880 | Like I think the intuitive idea of the world is it's zero-sum.

01:12:18.640 | If somebody's getting more, somebody else must be getting less.

01:12:21.040 | But that's not true.

01:12:22.040 | Right.

01:12:23.040 | Like the good news of economics is everybody can get richer.

01:12:26.080 | Everybody can have more.

01:12:28.280 | And the way that happens is technological improvements, basically.

01:12:33.600 | People figure out how to get more stuff out of a day's work.

01:12:38.520 | Right.

01:12:39.520 | People figure out new efficiencies, ways to do new useful things.

01:12:42.600 | And so the show, the big idea of the show is like, let's talk to the people who are

01:12:47.160 | actually figuring that stuff out.

01:12:49.600 | I think next week is going to be DNA storage, right?

01:12:53.320 | People are figuring out how to store data in DNA, which is just like rad.

01:12:58.960 | And apparently you can fit the whole internet in a shoebox.

01:13:02.360 | But of course, it's super expensive now.

01:13:03.760 | And there's like all these hard problems.

01:13:04.920 | How do you make it cheaper?

01:13:05.920 | How do you make it actually work?

01:13:06.920 | So that's the idea of the show.

01:13:08.680 | One thing I always ask everyone, because a lot of our listeners love to travel, is pick

01:13:13.040 | a place you're pretty familiar with.

01:13:15.440 | Someone's in town there.

01:13:16.840 | Where should they go for a great meal?

01:13:18.600 | Maybe a drink and some unusual thing to do to spend an afternoon.

01:13:22.120 | I mean, I live in New York and you know, my hack for New York is like, just walk around.

01:13:29.920 | I don't know if that's too obvious to be a hack, but like, I love New York.

01:13:34.080 | I love living here.

01:13:35.760 | I don't, even before the pandemic, I never really went to the theater.

01:13:39.040 | Didn't go to, didn't go to anything.

01:13:41.480 | I just like being in New York.

01:13:42.920 | I just like walking around.

01:13:44.200 | Just get on the subway, walk around downtown and just, just enjoy.

01:13:49.360 | It's free.

01:13:50.360 | Eat anywhere.

01:13:51.360 | It doesn't matter.

01:13:52.360 | Eat at a cart, you know, just be in the street.

01:13:53.360 | So that's one.

01:13:54.360 | I don't know if that's weak or not.

01:13:55.480 | The other one that came to mind, I grew up in San Diego and my favorite place to eat

01:14:01.460 | in San Diego is a taco shop called Roberto's, which is just like super low key, cheap taco

01:14:06.480 | shop.

01:14:07.480 | It's actually, there's several of them.

01:14:08.940 | My favorite one is in Delmar and it's just a little taco shop near the beach, near Torrey

01:14:16.420 | Pines is the name of the beach.

01:14:18.460 | But just go there and get whatever.

01:14:21.080 | You can get a, get whatever you want.

01:14:22.620 | Get a carne asada burrito if you want to get one, sort of mild classic, but get whatever

01:14:26.020 | you want.

01:14:27.020 | You sit out on the deck and you have a view of the ocean.

01:14:29.780 | It costs, you know, it's cheap, it's delicious.

01:14:33.380 | The beach is right there.

01:14:34.380 | You can go jump in the ocean.

01:14:35.380 | It's an incredible state park, Torrey Pines state park with these beautiful bluffs out

01:14:39.300 | over the ocean.

01:14:40.940 | You can hike there.

01:14:41.940 | Maybe you'll see a dolphin.

01:14:42.940 | You see the ocean.

01:14:44.020 | It's amazing.

01:14:45.820 | That's exactly the kind of recommendation people love.

01:14:48.420 | Thank you.

01:14:49.420 | Roberto's Torrey Pines, Delmar.

01:14:52.780 | I love the show.

01:14:53.780 | Thanks for doing it.

01:14:54.980 | People should definitely check it out.

01:14:56.580 | Any other places people should find you online before we wrap?

01:14:59.100 | I spend too much time on Twitter.

01:15:00.740 | I'm @JacobGoldstein.

01:15:01.740 | If you ask me a question there, I'll see it and answer it.

01:15:05.560 | It's nice.

01:15:06.560 | Awesome.

01:15:07.560 | Jacob, thank you so much for being here.

01:15:09.840 | It was a delight.

01:15:10.840 | Thanks for having me.

01:15:11.840 | You're welcome.

01:15:12.840 | Thanks for having me.

01:15:12.840 | Bye.

01:15:13.840 | Bye.

01:15:18.840 | Bye.

01:15:23.840 | Bye.

01:15:28.840 | [BLANK_AUDIO]

Planet Money: Inflation and the History of Money with Jacob Goldstein | All the Hacks 64

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