- Welcome back to Portfolio Rescue. As always, I'm joined by Duncan Hill. Duncan, thanks for making it. We get a ton of questions from people on YouTube and our inbox. Sometimes the questions are topical, sometimes they're evergreen, but we have a very intelligent audience, right? So great question. So let's get in.

So remember, our email here is askthecompoundshow@gmail.com if you have a question for us. Let's do one. - Okay. First up today, we have, "Technology has made investing easier with indexing, direct indexing, robo-advisors, etc. With AI in vogue right now, what does the RIA and financial planning space look like in another 20 to 30 years?

Will there still be a human need to hold your hand or talk you off the ledge? Or will the only human interactions be those... Sorry, we lost it there. Will be those maintaining the tech behind the scenes?" - All right. I love this question. There were similar questions asked when robo-advisors came out.

It was kind of like, "Is financial advisor still necessary here?" And AI is not robo-advisors, right? This is a whole other thing. Obviously, no one knows how AI will transform our lives, but speculation is just running rampant now because of all the chat GPT stuff. The possibilities seem endless.

There's tons of speculation from people. I think this is the fun stage of innovation where people just spend all their time thinking what the future could look like. I do think this is one of the first major technological breakthroughs where people can see it immediately. The first time they try it, they say, "Oh, I get it.

This makes sense. I've done a few demos on some of this stuff, on some ideas and startups, and it makes sense." So even though we don't know exactly how it's going to change our lives, how the businesses will use it, I think we can be sure that it's going to evolve from here.

I'm going to skip over the Terminator end of days stuff, right? Because I don't know. That's a pretty easy one to figure out what the end game is. So I'm going to focus on how this could change the financial advice realm going forward. I do agree with you, by the way, though, just for the record, from what you were saying on Animal Spirits yesterday.

I think that the negative that is going to come from AI is very easily or likely going to outweigh the positive if we're not careful. Unfortunately, there's going to be some wonderful things that come from it, I think, especially for knowledge workers like us. Content clips, and there's going to be so many different things you can do, and we're going to look at one of those right now.

I do think the downsides could be pretty drastic and scams, and I think it's just another tool of a tool belt for people who want to take advantage of others. So one of our loyal viewers, I don't know if he's in the chat today, Part-Time Larry, which is just a, it kind of sounds like a comedian's name, maybe?

Like, "Oh, I'm going to see Part-Time Larry tonight." He has a YouTube channel, and it's called OpenAI for Finance that's looking into some of the ideas here. He created this video, and he didn't even send it to us. Someone else sent it to us, and he used chat GPT to essentially create a portfolio rescue question and answer engine that just blew me away.

Maybe we'll try to put a link in this in the show notes. Yeah, we'll wing to it. So he took all of the questions that we've been answered, he uploaded them somehow, and he created this financial advice box, basically, where you ask a question, and it would spit out an answer based on how we've answered questions here in the past.

So it's essentially a portfolio rescue AI. And the whole thing that he... I didn't get all the technical aspects of what he was explaining, but it did kind of blow me away. And we're still in the early innings of this stuff here, right? This stuff is only going to get better and more useful, and I was blown away by the stuff he could do when we're still in like the first inning of this stuff.

So I love the idea of having an archive of my blog or any of the podcasts and giving people the ability to search seamlessly for charts and graphs and data and answer and context and even movie recommendations. So if Larry's listening, my next AI request for him would be, people always ask us for Animal Spirits, "Do you have a list of all your movie and TV show recommendations somewhere?" No, that'd be way too hard for us and too much of a pain in the butt.

But if AI could do it, that'd be great. All of Michael's horrible movie recommendations and my wonderful TV movie recommendations. So maybe AI can help there too. So the question is, will everyone have their own AI financial advisor someday that executes a financial plan on their behalf? It wouldn't surprise me if something like that existed someday.

It certainly makes a lot of sense. Do we need John Connor to go back in time to save financial advisors and kill this technology before it gets off the ground? I would actually go the other way here. I think if AI lives up to its promise, I think it's just going to be a commodity that everyone has access to.

And that only increases the value of human advice, right? So Howard Lindzen, friend of the show, likes to say that there's no such thing as information overload, only filter failure. And I think if AI ends up becoming this subtotal of human knowledge on the internet that has this interactive format, then the best advisors are going to be the ones that were able to filter out the best uses of it, make their lives more efficient and make things, make tools better for their clients to use it in concert with that technology.

So I think it's like a compliment to good advisors. So I think that's always been the case, advisors who are able to use the newest technology. So the thing about financial advice is there is no black or white or right or wrong for most of the big decisions, right?

What's the right asset allocation for me? Well, it depends. What's the safe withdrawal rate for my portfolio? Well, it depends. Should I invest this extra money or put it into paying off my mortgage? Well, it depends. There's so many different questions you can kind of go down that path and say, it depends, it depends, it depends, right?

And so I think good financial advisors know how to mix probabilities, statistics, and financial data with a little bit of common sense and empathy and behavioral psychology. So I think the value of a good financial advisor is always going to come down to things like trust and effective communication and setting realistic expectations and just having a deep understanding of your clients and diagnosing problems before you give a prescription.

And so I think still having that ability to help people through tough parts of their life or good parts of their life, the birth of a child, the death of a spouse, divorce, retirement, loss of a job, big purchases, market crashes, all this stuff, I still think you're going to need a human being on the other end of that to help see you through.

Because financial planning is not just like a one-time event. You don't create a financial plan and that's it. It's a process that takes a while and you have to navigate those decisions. And I think navigating those decisions requires a lot of compassion and education and communication and just a level of trust that is difficult to establish with a piece of software.

So I just think AI is likely going to be able to help with a lot of the technical financial variables going forward, but there's a huge difference between technical knowledge and the management of relationships. Right or wrong, people like to work with other people that they respect or they trust or they just like to work with.

So I still think it's silly to predict what's going to happen with AI right now because there's so many, most of the forecasts people are making right now are going to look silly in probably a few years, maybe a few months. I think there will always be a place for financial advisors and the best ones have always known how to mix the best human elements with the best elements of technology.

And I don't see that changing anytime soon. Yeah, that sounds right to me. And also, how many people are like, "Oh, I really wish that I had a chatbot instead of a real person to talk to about fill-in-the-blank topic." Now, there will come a time when the AI chatbots will probably be better than the average human, I guess, that you would be talking to as far as support goes.

But yeah, to me, yeah, I just, I think that the human element is a pretty important part. But I mean, we're biased, we're humans, right? So I guess if we were AI, we'd have a different opinion. Yeah, you're asking a barber whether a robot haircutting machine, I mean, did the Flowbee put barbers out of business?

No, right? You want that good conversation when you're sitting in the barber chair, right? So I do think the human element of it is, because again, a lot of the decisions people are forced to make about their life, there's two or three different paths that you could take. So I think someone that helps you make those decisions is always going to be helpful.

And I think the best experts will be the ones that can rely on this AI to help them better answer questions on people's behalf, and then figure out which is the right or wrong answer for them personally, because there are no answers that are right for everyone. It's very circumstantial.

Also, what's to stop the AI from starting to take a cut? You know, it's like all your transactions you suddenly start noticing aren't quite adding up. The AI's like, "I didn't do anything. What are you going to do?" This is a financial scamming part. You need someone to monitor the AI to make sure they're not stealing all your money.

All right, let's do another one. All right, that question was from Michael, by the way. We've had a lot of Michaels writing in. Yeah, that's true. Great, yeah. Everyone born between 1975 and 1991, 75% chance you're named Michael or John. Right. All right. All right, up next we have a question from Jeff.

And Jeff asks, "How far in advance do markets generally get things priced in? Does it change from sector to sector? The reason I ask is that Josh on TCAP was saying he thinks commercial real estate is the next shoe to drop. That got me thinking about how well the market prices stuff in." Easily one of the hardest questions to answer when it comes to the markets, because sometimes the market is forward-looking enough to price things in, right?

Like when the vaccine got here during COVID, there was a lot of other factors at play, but markets were already back at all-time highs by the time the vaccine rolled out, right? But there are some times when the market overreacts, sometimes when it underreacts, and sometimes when it just doesn't react at all until it's too late.

And there's an old joke, I think Paul Samuelson said it, that the stock market has predicted nine of the last five recessions. I wrote about this last year, about the two different types of bear markets. So John, throw the first one up. So you have recessionary bear markets, which these are pretty easy.

They encompass the majority of the worst market crashes in history. Some pretty nasty times, the Great Depression in 1973, '74 bear market from inflation and bursting of the dot-com bubble, great financial crisis. That's pretty easy, right? Most of the bear markets in history are associated with an economic downturn, which makes sense.

But there have also been plenty of bear markets that have taken place outside of recessions. So we have the non-recessionary bear markets too, right? And some of these happened for legitimate reasons, but some of these happened just because the market decided to overreact, and there was no real reason there.

And it's not like the market... In 1987, when the stock market crashed more than 20% in a single day, the next day all the headlines were proclaiming, "I think a Great Depression is here. The stock market has to know something." And the stock market recovered, and it was off to the races again for the rest of the '90s, and things were fine.

So, John, just throw up the little summary here just for people. So the non-recessionary ones don't freak out as bad, which makes sense, because a lot of times they're not correlated with a really nasty recession. But people can overreact. The stock market can overreact because people are the ones pulling the trigger, right?

And you'll notice I didn't include the current incarnation of a bear market, because we don't really know if it'll be associated with a recession or not. I would say if we go into a recession in the next six to 12 months, you can count this one as put that in recessionary camp.

If not, I think we push it out. This was a non-recessionary bear market. We shall see. Burton Malkiel has a quote about efficient markets that I think applies here in terms of thinking about what's priced in. And his quote about efficient markets is not that like it means the markets are always right, but he said the price is never right.

In fact, prices are always wrong. What's right is that no one knows for sure whether they're too high or too low. It's not that the prices are always right. It's that it's never clear that they are wrong. The market is very, very difficult to beat. And so I think one of the harder things to understand with the markets is it's not really good or bad that matters, but better or worse.

And when you're trying to figure out what better or worse is, you are trying to answer this question about what's priced in. And again, that's really tough to figure out. So it does seem like commercial real estate is a thing people are becoming worried about. I don't know what's priced in, because it does kind of seem like this is clear as day for a while that people aren't going back to the office.

Big cities like New York and maybe San Francisco, their commercial office space is going to be in for a world of hurt potentially. But we're talking about a $20 trillion market here. Some parts of commercial real estate will be fine. Other parts are probably in for a huge adjustment period.

But the biggest question here is not only what's priced in, but how much does this actually impact the economy or the stock market? Maybe certain segments or investors or buildings are in trouble, but is that really enough to impact the entire economy? Will other parts of the real estate market pick up the slack, because those people have to go somewhere, right?

Now, these are the only answers that show why it's just so difficult to answer. And I think everyone thinks they know what's priced into the market at any one time, but no one really knows for sure. And the biggest risks are usually the ones that you don't see coming, like the ones that you don't see barreling down the highway.

Those typically aren't the ones that get you. It's the ones that you don't see coming, maybe like a bank run, right? Those kind of things. Right, right. Yeah, efficient markets. That's some of my favorite jargon, you know? You start dropping that when you want people to know you know what you're talking about.

Well, or yeah. It's a weird argument to have, and markets are like kind of sort of efficient, and in that they are hard to beat. But of course, markets are irrational because humans are irrational. Right. All right, let's do another one. Okay. You know what won't be irrational? AI.

Yeah, not at all. I'm just picturing there has to be like a big off switch somewhere, right? If we're headed toward the Terminator, everyone says, "Well, it'll happen before anyone knows it, and this thing, this sentient being will become so smart that it'll just wipe us all out." I just want a red button to hit off, like, "Okay, we're calling it.

No more AI." I think we have that. I think the person controlling it, though, is Elon Musk. Okay. All right, let's do another one. Okay. Up next, we have a question from Ryan. "My question revolves around bailouts. I'm too young to remember how everything played out in 2008, so this whole episode with SBB is new to me.

I understand why government officials stepped in to avoid more bank runs, but I can't reconcile that with the fact that bailouts don't seem fair. How did we get here? Does every big financial institution just get bailed out in the future if they run into problems?" We've had a ton of questions about this.

A lot of people feel like it's unfair. Yes. There's a lot of this going on, so why don't we bring in the guy who literally wrote the book on this subject, Mr. Barry Ritholtz. Hey, Barry. You wrote a book called Bailout Nation to kind of help people understand how we got to this place following the 2008 financial crisis.

When did this book come out again? 2009, 2010? Late 2009. Also, I want to just give you... You have Rubini on the cover. Crazy, right? Right? That's hilarious. I love that. "A beam of enlightened thinking in a sea of delusional complacency." That could be the best blurb I've ever read.

Not bad. I read this book when it came out. Correct me if I'm wrong, but you kind of trace this back to how it was kind of a snowball building up, starting with the Chrysler bailout in the '70s, right? Before. Lockheed in 1971. It went Lockheed. During the Vietnam War, they had run into financial problems.

They took, I think it was a $250 million loan from the government. They had screwed up. Then Chrysler in 1980 was another example of it's an election year. It's a big employer. It's somebody that is located in a politically important swing state. They got a multi-billion dollar loan because they had been mismanaged for not just a couple of years, for decades.

They eventually paid it back. It'll work out. Eventually Chrysler gets bought by Mercedes, who a couple of years later says, "Why did we buy them? They're terrible." They learned how to build Jeeps and that was it. They spun them back out. The question, why are we bailing people out?

I think you need to be a little nuanced in your definition of what a bailout is. First, and we could get into a lot of details, when you look at '08, '09, what happened is people who were extremely risk-embracing and aggressive and painted themselves into a corner, their own decision-making, their own behavior, got them into trouble.

They were made whole. To me, a bailout is when someone gets rescued from their own folly. People had the right to be mad about those bailouts, the way things happened and the way that that was structured. It did feel like, "We're going to let a lot of these homeowners lose their houses and they're screwed and you're on your own, but the banks, we're going to make you whole." I think people had a right.

None of those guys went to jail. Some of them probably should have. Some people should have gone to jail. Dick Foulds, front and center. The CEO of Lehman Brothers was engaging in a repo 105 every quarter. They were hiding all this debt off balance sheets so shareholders couldn't see it.

A lot of bad behavior. Now, who is bailed out this time? The depositors in Silicon Valley Bank? Let me make sure I understand this. You select a top 20 bank with a 50-year track record. What recklessness or bad behavior or bad decision making did the depositors have that we have to worry about moral hazard?

It's one thing when you say every bank was making a ton of money securitizing junk mortgages and they didn't care about the quality of it and the thought was, "Let's just jam as much as this stuff into stuff and sell it back out to the market and get paid a ton of money for it." There's some moral hazard there.

They're engaging in reckless behavior in order to profit from it. Someone who goes down to the corner bank and says, "Here's my $500,000. I'm running a small business and I need to do payroll and accounts payable and all that through this. Oh, and I'm over the $250,000 minimum." Sealing for FDIC.

What did that guy do wrong? Right. This would have been different if the equity holders would have been bailed out and the bond holders would have been bailed out. That's the kind of thing that people got mad about in a way which felt like that happened to a lot of banks.

AIG for sure. A lot of the banks, there were rescues. Even Bear Stearns, this was bought at $2 a share. It moved up to $10 a share. It was a very famous picture. Someone taped a $2 bill to the Bear Stearns glass door entrance at their headquarters that went viral back in the day.

But that's the real question. Silicon Valley Bank, shareholders, zero. Wiped out. The bond holders, it's going to be somewhere between 30% and 50%. They're going to lose a big chunk of it. That's very different than, "We're going to make you whole and we're going to save you from your own bad decision making." I think the sentiment that I can kind of relate to is I've seen people saying things like, in individual businesses, I think most people would make a distinction, but an individual who had millions of dollars in the bank, shouldn't they have known the FDIC limit?

And so isn't that kind of them being reckless at that point? You know, if you're running a business, what are you going to do? I've also seen people pointing out that a lot of the same people who were asking for the bailout in this case are the same people who've talked about the bailout for student debt or whatever, essentially being unfair.

When 17 and 18 year olds making big loan decisions, you could argue is an ignorance situation, right? People don't understand what they're getting into. Okay, someone who didn't understand the FDIC limit, that's their own ignorance maybe. I've seen a lot of people making those points. When it does, I know some people argue about what's systemic and what's not.

I do think when it gets down to the banking industry like this, there's no regulator politician in their right mind that's going to just, "Okay, let's let the system fail so these people get punished." Because then you punish other people. That's the thinking here. Unless you get a crazy person running one of these FDIC or the Fed or something, I don't see how that ever happens where someone just, "Okay, let's let the system fail because these bad actors did something wrong." Ben, you're dead right with that because the concern isn't some small businesses over the FDIC limit or some people with a little money over it are going to be punished for going to a local bank.

The thinking of the FDIC and the Fed is a run on the bank is pure emotion, pure psychology. It's a contagion and we want to stop it here in its path. If you look at the market the past two weeks, it seems as if the market is behaving. You never want to try and guess what the mostly kind of sort of efficient market is thinking, but it seems like the market has said, "Hey, it looks like the Fed and the FDIC has halted the contagion from spreading," and that's good for the overall economy.

Yeah. All right. Let's do another one, Duncan. Okay. And just a quick follow-up there. What would Monday that week have looked like had they not basically stepped in and said, "We're backstopping above the limit"? A little bit of panic, right? I think if you remember, those of us old enough to have traded through '07, '08, '09, it's like every week there was a different piece of news that came out and the market reacted to it.

Probably the worst of all was when Congress said, "Oh, we're not going to backstop the Fed. We're not going to allocate any money," and it was like a 10% drop in a couple of days. That was nasty. That was a bad day. Late October. That was early October of 2008.

That was like, wow. I remember that. It was a scary day. It might have been the biggest percentage drop since '87. So it would have had horrible market ramifications, but also bank run potential, right? Well, keep in mind, the difference between 2023 and 2006, '07, '08, '09 was every bank, every brokerage firm, every private lender, they all had gone to the same buffet, and they all were eating the same poisoned food, and they all subsequently got very, very sick.

This seemed to be, you know, Signature Bank is different than Silicon Valley Bank. There was one other bank that had a separate issue. Some of them had too much exposure to crypto. Silicon Valley Bank was a simple duration problem, and by the way, Silicon Valley Bank had duration hedges on in 2022, and they had gone up so much in money because of rising rates that they took their profits.

They sold them, and everybody got a big fat bonus, not realizing you just took your hedges off, and the Fed is going to continue to raise. So, you know, there's always these complex layers of things going on beneath the surface. Cool. This is a perfect segue to the next question, and by the way, I love this.

We're helping settle a debate. I love this. I want more of this. People should write in more often for you to settle debates. Okay, so this question's from Kevin. "Help me settle a bet I have with one of my co-workers. We're both advisors with an RIA. I know there is always something to worry about when it comes to the markets, but what should we worry about more right now?

Inflation at 6% or the Fed breaking things/the banking crisis? I'm more worried about the banking crisis leading to a slowdown, while he still thinks inflation should be the Fed's biggest priority. Thoughts?" The funny thing is, Barry, you do a really good job of always looking at the macro through the lens of probabilities, but I think it's hard to kind of separate the two right now, because if there is a banking problem, that could impact inflation, right?

So it's kind of hard to handicap this one. Yeah, no doubt about it. I mean, looking at inflation, especially on the good side, it very much looks like inflation peaked, you know, three quarters ago. In June of last year, look at lumber, container ships, copper, like all the things that had skyrocketed.

Even food prices are moderating. It always feels like the Fed is late. They were late to get off of their emergency footing. They were late to recognize inflation. Remember, they had a 2% target, and CPI went through that in March 2021. They waited a full year to start tightening.

They should have been off of zero long before that. The problem isn't the level of the Fed at, you know, around 5%. It's how rapidly they raise rates. And that's where, you know, I did a blog post a couple of weeks ago, before Silicon Valley blew up. The Fed is breaking things, and it could get worse.

And, you know, that fastest ever tightening cycle from zero to 5%, that's the problem. 5% is not historically high rates. Right. I think, yes, that's the problem is we've never seen it go from zero to five this fast. And it would be nice to have a little bit of a breather here to see what happens and make sure nothing else.

Because when people were talking about the Fed breaking stuff, no one ever said it's going to be a banking crisis, right? No one was predicting that. People thought, well, the Fed's going to send us into recession, and people are going to lose their jobs. And it was the wrong thing.

So I think that's the thing you have to worry about is what are the unintended consequences of this aggressive rate hiking? And if inflation is still high, five or six months down the line, then maybe the Fed has to, you know, step on the gas a little bit more.

But I think that's the worry is, like, what are the other ramifications here if they keep raising and keep being so aggressive? That's the irony is that it's just a reminder of how bad we are as a species making predictions and forecasting. Everybody a year ago forecasting a recession, turns out the economy is very resilient and employment continues to hold up.

But a few years ago, oh, the banks are fine. We could roll back regulations and allow them to carry less capital. That turned out to be a terrible decision. Yeah, I think it is, if we're giving the Fed a pass here, managing a $24 trillion economy and trying to get it to maneuver one way or the other is very difficult.

And we've seen that their levers that they can pull might not have the desired effects that they want. Maybe they shouldn't be trying to manage a $24 trillion economy. And maybe they should listen a little more to the bond market, because it seems like the Fed has spent much of the past three years ignoring what the markets were suggesting to them.

And a perfect example from the Lowe's post-COVID crash in March 2020, by the end of the year, and this goes directly to your mostly efficient market conversation earlier, by the end of the year, the stock market rallied 68%. If that's not a market signal that, hey, maybe this is an emergency and we should get off zero, I, to ignore that, I say with the benefit of perfect 2020 hindsight, seems to have been the big mistake.

Had they paid attention to that, they could have done a quarter point every other meeting and slowly brought us to a place where rates weren't inflationary, but they weren't breaking things. If you throw a dinner party at eight o'clock, Jerome Powell's showing up at 1130, right? Always late to the party.

Yeah, 100%. All right, we got one more. - Okay. So, last but not least, we have a question from Brendan. "How did you get your start in writing and podcasting? I'm fascinated by markets and have been since college. I selfishly want to write to document my thoughts and commentary on the market, and if it gains steam, great.

Did you find this idea of documentation helpful in your career progression? What initial steps should I take to potentially become a financial journalist on top of working in the industry?" - All right, so I wrote a blog post about this recently, reflecting on some lessons since it's been about 10 years since I started Wealth of Common Sense.

I'll go through some of my biggest takeaways and we'll get some of Barry's too. I just said, Barry, you've heard about this before, like writing is a form of learning, like it's, I write to figure out what it is I think. That's part of it that I never really banked on before is how much, how helpful that would be in terms of just collecting your thoughts and it's not just like you have it already formed here, it's like the writing process helps you get it out, right, and helps you figure out what it is you're trying to figure out, right?

- A hundred percent. Daniel Boorstin, the former librarian at Congress, used to say, "I write to figure out what I think and besides at that hour all the bars are closed," and, you know, it's only half in jest. Very often until you put words to paper, until you actually type something out, you don't really understand the nuance of the whole argument.

I started blogging because, and you're coming up on 10 years, July will be 20 years for me since the launch of TypePad when I launched. - Did you call the big picture from right away? - So when it was on GeoCities, I know I have some screen grabs of it in like '98 or '99, it might have been the big picture and it was definitely the big picture on TypePad which was the first WYSIWYG editor where, you know, on GeoCities you take, you know, a half hour to write something then two hours to code it in HTML.

Once you move to TypePad, it's sort of like writing on a Word doc or a Google doc where you can underline. Imagine every indent, every paragraph break, every, you know, italicized you had to come up with the right code for. This made it much easier and then '08 moving to WordPress really turned out to be very robust then and really interesting.

- I think the biggest thing, you've been doing this along with me obviously, you and I never got into this because we said we're going to be financial journalists, we're going to get a big audience. We did it because we found this stuff interesting and we wanted to put our voices out there.

It's not like we had this grand scheme. I think none of us did, me or you or Josh or Michael or Nick. So I think to have longevity and do this for a long time, you have to write about things that you care about, not things that you think you want people to read about.

You can't like try to optimize this for things people want to learn and I'm going to create the best headlines because that's going to get the most people to read and I'm going to write about this topic because that's what everyone's clamoring for. You obviously want to write stuff people want to read, but you kind of have to do it in your own voice and write about things that you care about.

Otherwise, no one else is going to care about them if you don't. - That's absolutely right. Listen, I started blogging because I wanted to become a better writer and the only way to become a better writer is to A, read good writing and B, write and preferably a little bit every day.

And so what started as, "I'm just going to pull a half hour to an hour aside early each morning to prep for the trading day," became just a habit and it's like, you know, the best gym rats are the guys who work into a routine and they just go all the time.

It's just part of their daily schedule. It's not like anybody has to tell them go to the gym or go for a run. It's just part of how they operate. - It is a routine and obviously there's people who were born to write that just have that natural gene.

But when I was in high school and college, I hated writing papers because I never found a topic that I enjoyed enough to actually get into it. And once I started to write about finance and psychology and the markets, I loved it so much that I wanted to do a lot and I go back to the first few things I wrote.

They're probably horrible, but I think it's something that if you do it enough and you have a routine, you can get better at too. - No doubt you get better at it, but really you hit on the magic secret, which is write about things that you're really interested in that you want to learn more about.

You know, I do a car post a couple of times a month, not because I feel anybody cares what I say about this car or that, but it kind of allows me to do a deep dive into a particular type of car and just the exercise of researching and pulling out some data and putting it together, like, "Oh, I really understand why this type of EV has become suddenly popular." And it's just, it's a learning exercise.

- Yeah, and I love the fact that I get to do it now. And sometimes you, personally, I forget people are on the other side reading it sometimes. It's great to get feedback from people. - Audience of one. - Yeah, that's kind of the way you have to approach it.

So I wouldn't approach this trying to become a journalist and build an audience. I would approach it for, "Is this going to help me personally, make me a better advisor, make me communicate better to my clients?" And if other people want to read that and you do build an audience, great, but I wouldn't start with that proposition.

- And to answer the second half of the question about the podcast, you know, some of the writing began because I was frustrated with what I was reading. And I remember having an argument back and forth with a Wall Street Journal editor who were talking, it was, there was a column about the improving housing market from February to March to April.

I'm like, "That's seasonality." Guys, look at it year over year. If it's really improving, it shouldn't be going down year over year. It always bottoms in December, January. It always tops in July. Why? Because people want to move into a new school district so their kids don't miss the start of the new school year in September.

So podcasting kind of began the same way. I was frustrated with the same stupid questions on TV interviews you heard over and over again. So what's your favorite stock? Hey, where's the Dow going to be a year from now? And when is the Fed going to raise, cut, whatever?

And those answers to that question have a shelf life about as long as it takes for the guy to walk out of the building, and then they're already stale. So the idea behind Masters in Business was always, "Hey, if I could get really intelligent, accomplished people to sit down with me and say, 'Here's how I became who I am.

Here's how I developed my process. And here's what you can learn from me.'" I thought that was more valuable than stock picks, forecasts, and Fed predictions. Amen. I remember I wrote some piece about like, "Why doesn't financial television do this, this, and this?" Back when I just first started blogging.

And you emailed me and said, "This is before I even worked with you, I think." And you said, "I'm developing behind the scenes at Bloomberg this sort of thing that you're writing about." And what year was it? 2013, 2014? So it was the column launched in 2013, and the podcast didn't launch till the following July, but it was in development for six months.

And by the way, those first six months of podcasts, they're just horrible. They're just not worth listening to. That's another thing that you're talking to people and interviewing, that's another thing you can get better at. My favorite recent one is always one of my favorite guests is Cliff Asness, who you said in recent weeks.

So good. So much fun. But how often do you get to find a legendary fund manager billionaire and ask him if he's a dickhead? I know he's a science fiction wonk, and we were talking about Philip K. Dick, and the fans of Philip K. Dick, of which I count myself as one, call themselves dickheads.

So he brought something up. I said, "Are you a dickhead?" And he just laughed. He knew exactly where I was going. The ability to have those sorts of conversations. I'm glad you explained that because I did not know that. Okay. The ability to do that is just one of those crazy things, to have that conversation.

And I wouldn't have asked him that if he, you know he's like a crazy Marvel fan, and he's a big sci-fi geek, and he actually reeled off all or at least many of the Philip K. Dick books that became big science fiction movies. Total Recall, based on Philip K.

Dick. We Can Remember for Your Wholesale is the name of the book. Blade Runner is based on Do Androids Dream of Electric Sheep? Minority Port. And there was an Amazon series, when streaming first got big, called Man in the High Castle, that was based on a Philip K. Dick story of what happens if Japan won World War II and America lost?

What does the world look like? And you know, he is one of those people that loves that sort of stuff. That sort of conversation is what makes that format so much fun. Yeah. I didn't realize the movie thing was a science fiction. That's great. I love Minority Port. One thing I was going to say there, just quickly to Brendan, is he said journalist there.

I think that there's a distinction here between like blogging and journalism, right? Journalism is kind of the opposite of what you're talking about, where you're told this is what we need you to write about. This is the hot topic this week. You guys can write about whatever you want.

That's part of the beauty. The people that work for Bloomberg and the Wall Street Journal and Financial Times, these people went to journal of the school in those cases, or they were so... Yeah, you're right. That's a totally different thing. There's a big difference between opinion and commentary and actually reporting what happened, actually reporting the news.

When I had the Washington Post finance column and when I write for Bloomberg, it's clear that this is my opinion. And in fact, like when I broke some news about the bonuses with Bill Gross and PIMCO, even the way they did it, they brought in Mary Childs to do the story on Bill Gross and I did the opinion piece about why are you paying somebody $300 million annual bonus seems a little excessive for managing fixed income.

Do you have any news to break today? The only news I could break is as soon as you said the mostly sort of efficient market, that was the title of one of my first viral posts. And I went back and looked at it and embarrassingly, it's 2004, the mostly kind of sort of efficient market.

So I don't know if that's news or nostalgia, but it's just hilarious. I was a junior in high school. Whatever's old is new again, it just circles around. I graduated college that year. Okay. Thanks to Barry for joining us. Love his stories as always. Remember, email us if you have a question, askthecompoundshow@gmail.com.

Leave us a review, hit the subscribe and like button. If you have any comments on YouTube, thanks as always to everyone who showed up live. We always appreciate your comments. And we'll be back. I'm gone next week on spring break. We'll be back. We'll still be here though with a special episode.

Surprise show. See you next time. See you everyone. Thanks, Barry.