Brent: I'd like to welcome to stage Morgan Housel.

Well, this is a long time coming. I already regret doing this. Yeah. Do you have any idea what's ahead of you? Absolutely not. So. When Justin Timberlake wrote the song Bringing Sexy Back, it was rumored that you were the subject that he thought about. 

Morgan: Thank you.[00:01:00] 

Welcome to Columbia, Missouri, 

Brent: my friend. 

Morgan: First time 

Brent: here. It's good to see you. Yeah, it's good to see you, too. We were joking that it's been a long time since we've seen each other in person. A lot of conversations. I feel like that we've gotten to experience a lot of life together over the last five years.

Morgan: You know what's really interesting? I do remember this. In early March of 2020, You and I were talking on the phone, and you were the first person who said, No, this is not a little thing coming. This is a big, you were the first person who really set me straight about what was, what 

Brent: was about to hit us.

Yeah, well, I try to create anxiety in your life. It worked, yeah. I feel like I've done a pretty good job. So, how, I guess I should, I want to start off, so you're like a, you're like a big time writer guy now. Um, you sold like, like 10 billion books at this point. I mean, it's, it's incredible. I think of the books sold last year, like you're like one of the top authors in the world, literally, in the last couple years.

So, how did you get I 

Morgan: mean, I, I've been, and this is true for any field. David Semra, who's here, talks a lot about this [00:02:00] too. He doesn't write good. Well, he's, but he's good, he's very good at what he does. He's good at the talking. And what he talks a lot about in his podcast, the people he covers, have done the same thing for their whole life.

They've been doing one thing for 20 years, 50 years, and that's how they get good at it. And so I feel like I've been doing the same exact thing, writing about the same topics, in the same style, at the same length for 17 years now. And I think anybody, in any topic that they're covering, in any kind of field, any kind of profession, if you put that, just kind of, focus on one thing, without jumping all over the place.

That's where, that's where skill in any field comes from. That's true for you. It's true for these guys. Like all, all of it. It's just kind of like you do one thing, you focus relentlessly on it and you do it. And after 10 or 20 years, you build up some skill. So 

Brent: when you made it. Like when you, when you figured out that this was going to be a thing that you were going to do.

It's, it's, it's been fairly recent. I mean, you were a successful, like, blogger. Used to joke you were, like, just a lowly blogger for a [00:03:00] long time. And then I remember talking to you in Omaha, actually, at a Berkshire meeting. And you were like, yeah, I'm not sure what I'm gonna do. I may write a book. I may do all these things.

How has your life changed since you became truly a bestseller, like one of the top authors 

Morgan: in the world? I don't think it's changed that, that much at all. Having a wife and kids who will always put you in your place helps to remind you that you're an absolute nobody. Yes. Day to day. Having friends like you that remind me, uh, on text and on Twitter that I'm a nobody helps.

No, but truly, nothing's really, really changed. I was talking to, uh, Um, to, to Tim earlier, who works with you. Tim used to be my, my, my boss, now works with Brent. Who's my boss at, at The Motley Fool. Tim Hanson. And he asked me the same question this morning. And I said, really nothing's changed for, in terms of day to day work in 15 years.

But that's how it should be. Once, if you have a day to day process that works, and then at some new level you say, Great, let's break that process and try something new. Don't be surprised when the quality of whatever you're working on [00:04:00] breaks, too. So I feel like if the process works, which for me is just a lot of reading and talking to people and going for walks and thinking about things.

If I broke that process, then the writing would break, too. So even at whatever level of success it is, you got to keep that same process going. 

Brent: Well, let's talk about that process because, um, When I think of your process, I think, just think of laziness. You just, I, I picture, I picture what you're doing most days is you just sitting around.

Yeah. Like, you're just not doing much. It's, 

Morgan: that's, that's not, I, I, I know you're trying to joke right now, but, uh, No, no, actually, I was 

Brent: dead serious. These people think I'm joking, but I'm, I'm, I'm dead serious. It's, it's rough. You're one of the laziest people I know. But 

Morgan: I think it's true for any, for any writer that 99 percent of it is sitting around, reading, thinking.

Actually typing on a computer is a very small part of it. Because the process of writing is you're just trying to come up with some insight, some understanding, some story, some narrative. And what that looks like, most of the time, is like Sitting on the couch, thinking about things. Going for [00:05:00] a walk and thinking about things.

Which is actually why it's very hard to pull that off, inside of an organization. If you're a writer for the Wall Street Journal, or Reuters or whatnot, your boss is not gonna let you sit on the couch 40 hours a day, four per week, I mean, thinking about these things. And so, what your boss wants you to do is sit at the computer and type, and like, your fingers can't stop moving.

And that can create one kind of product that they're good at, news, but if you, if it's, if you want to have it be a creative endeavor. I think this is true for any kind of creative, any kind of artist. It's a lot of just unstructured wandering around trying to wait for the insights to hit you. So a lot of writers will disagree with this, but I don't think you can create an environment that fosters creativity.

I think a lot of people will disagree with that. So if others disagree with it, I think, I think they're wrong, but I don't think you, I think you have to wait for it. And the good ideas don't come when you try to force it. It comes, like, when you're in the shower, when you're doing the dishes, when you're going for a walk, when you're driving [00:06:00] your kids to school.

You just have to be like, Oh, that's, like, oh, I just pieced it together. That's what it is. So that's why you can't, you know, most of the, most of the process is just It's, it's, it's work for me, but to anyone else, it would just look like couch 

Brent: sitting. Yeah. Well, it's like engaged laziness. 

Morgan: That's a good phrase.

I'm going to use that phrase when my wife gives me crap now. Yeah, 

Brent: I was going to say, is your wife just like, you're sitting on the couch and you're like, Honey, I'm working so 

Morgan: hard right now. It's taken a while, but she finally realizes that when I'm sitting there, just sitting on the couch with my arms crossed, I'm working very hard.

Brent: Book royalties help with that. Help with the arguments. Does that too, yeah. Well, so, so it seems like the, the, the, in all seriousness, the formula is you have to live life and then you have to have the time to absorb the lessons that you're learning and to chew on them and connect them. And I think this is one of the things that truly you do in the best in the world.

I mean, connecting ideas and explaining them with clarity. Um, I remember I got an early copy of your first book and I don't want to take all the credit for it. [00:07:00] Um, but you know, I would say that I was responsible for a good portion of the, of the, you know, quality of it, you know, after the edits I sent back.

Yeah, so. Yeah, yeah. So, um, not to put you on the spot or anything. Um, but one of the things that you talked about in there was some, some life experiences that you had. And you've talked, you know, we've talked to LinkedIn about this. It's like. You've had some life experiences that have shaped and really changed your life in different ways.

And I think the one that I think about most that is life changing is the ski accident, or potential ski accident. Maybe you could just talk, I mean I know it's a tough subject and I know that we've talked in times about this. But maybe describe to the audience, for people who haven't heard, um, you grew up skiing.

You were, I guess, a decent skier. You were on a ski team. I assume you didn't suck. But, you know, um, And then there was this accident and it should have been you could have been you. Yeah. So I grew 

Morgan: up as a competitive ski racer in, uh, in Lake Tahoe, California. That was my entire childhood and teenage years.

I was on the squad Valley ski team and we would ski six days a week, 10 months a year all over the world. And that was, that was what we did. And there were about 12 of us on the squad Valley ski team. And, [00:08:00] uh, 2001, we were 17 years old at the time. Myself and my two very good friends who I'd known since we were, you know, six years old, uh, Brian Richman and Brendan Allen.

We were skiing together in February of 2001. And how the snow was structured at the time, on this day, was very important. Tahoe had just gotten blasted by two big storms. The first one was very cold. And a cold storm drops like very light, fluffy snow. And then a week later, it got another big storm that was very warm.

And warm, uh, storm is like very wet and heavy snow. So the snow is layered where it was like very light snow, and then very heavy snow on top of that. And we didn't think about this at the time. We were 17. We didn't think about any of these things at the time, but that structure, that layering creates textbook perfect avalanche conditions.

And then, so, on this day in February, we would ski pretty often out of bounds, which you're not supposed to do. You duck under the ropes that say, do not cross, but that's where the good skiing would be. It's untracked, you have the mountain to [00:09:00] yourself. So, we had been doing this since we were kids. And when we would do that, when you get to the bottom, there's no chairlift when you go out of bounds.

So, it would spit us out on this back country road, and we would hitchhike back. And this too, like, it was always a pain in the ass because the hitchhiking was so hit or miss. Sometimes you'd be out there for an hour just waiting for a car to pick you up. But it was fun, and it was kind of like a, like a rebel feel that we loved when we were 17 doing this.

So this day in February, uh, 2001, the three of us did it together. Skied down the back side of Squaw Valley, hitchhiked back, and as we were skiing down, we triggered a small avalanche. And I had never experienced it before, what it was like, but it was, like, completely unforgettable because as soon as the avalanche hits you You have no more control over what you're doing.

Because rather than pushing on the ground to gain traction with your skis, all of a sudden the ground is pushing you. So it goes from you feel like you're in control skiing, to all of a sudden you're on, like, uh, a roller coaster. And it's just gonna take you where it's gonna take you. But it was pretty small.

I came up to our [00:10:00] knees. We didn't think that much of it. I remember at the bottom being like, Oh, shit, you see that avalanche? Like, we high fived about it. It was great. We hitchhiked back. And Brendan and Brian said, let's go do it again. That was great. That's awesome. Let's go do it again. For reasons that I don't really know, I didn't want to do it again.

I think, I think looking back, it was probably the hitchhiking. Which always freaked me out. I was always certain we were about to be kidnapped. Uh, so I didn't want to do it. So I said, hey guys, rather than, rather than hitchhiking, why don't you two go do it again? And rather than hitchhiking, I'll drive my truck around the mountain and pick you up.

So you don't have to hitchhike. So he said, great, let's do it. We went our separate ways. They went skiing. I went down to take my boots off and I was going to drive around to pick them up. 20 minutes later, I meet at the pickup spot we were going to meet and they weren't there. And I didn't think that much of it.

This was, we, we didn't have cell phones at the time. And people were like, very comfortable. I'm so old. This is dinosaur age. People were very comfortable being out of touch before the cell phone. If you didn't know where somebody was, it wasn't that big a deal. So I didn't think anything of it. And I went about my day.

I figured they had [00:11:00] already hitchhiked back. I just left. And then the days went on, or the hours went on. And later that afternoon, Brian's mom called me. And she said, hey, Brian never showed up for work today. Do you know where he is? And I told her the truth. I said, we skied out of bounds this morning. I was going to pick them up, but they never showed up.

And in that moment, when I said those words, and she, Brian's mom, heard those words, we both, like, put it together. And I remember she said, oh my god, and hung up the phone. And then hours went by, we eventually got the police involved, missing persons report. And the police didn't take it seriously at all. I remember them saying, oh, for sure they're just out drunk at a party.

That's always what happens in these situations. But, we finally convinced them to get search and rescue involved. And search and rescue went on the hill at about midnight. It's still blizzarding. You could barely see a hand in front of your face because of the blowing snow. But they went out there. They had these giant portable floodlights.

And when they got up to the top of the mountain where we had started the out of bounds skiing, and they turned these floodlights on, they said it [00:12:00] looked like half the mountain had been torn away. from this enormous avalanche, that it was a fresh scar from an avalanche. So Search and Rescue knew at that point, they pieced together what could happen.

This is at midnight, and it was about 9 a. m. the next morning, so they'd been searching for nine hours, that the search dogs homed in on a spot in that avalanche field, and then they had these giant probe poles, and they found Brendan and Brian buried under six feet of snow. And Sabrina and Brian were born one day apart.

I think they were actually born like 12 hours apart. And they died about 10 feet, 10 feet from each other. And so like, whenever I tell this story, I have to preface it like, of course, everybody in here has lost somebody dear to them. The circumstances might be different, but some of the things that, I didn't really realize this at the time, but I had like, Almost a perfect childhood.

Nothing bad ever happened. Great loving family, no tragedies, everything was perfect. And then that kind of trauma at age 17, because it was such a contrast to how I thought the world worked, the bubble of perfection that I had been in before, it was, it was, it [00:13:00] was shocking. But I also, I wrote this in the terms of like, afterwards I realized that there's really three sides of risk, which is how I'd framed it up in the blog post where I wrote this story.

Every risk has three sides. One side is, The odds of getting hit by whatever the risk is. The other side is the average consequences of getting hit. Like if you get hit, what are the average, the average consequences of that risk? And the third side is like the extreme tail end consequence of whatever that risk is.

And that was the case for us, because we knew that skiing out of bounds was wrong and dangerous. But we, I think we implicitly assumed that the risk of doing it was that we would, our coaches would yell at us. Or maybe, like, the most extreme risk we could imagine is like you break a leg or something.

Never in a million years did we think that the consequences of the risk that we took would be that we'd die. Never once crossed our mind, but that was the extreme, that's the tail end consequence. And I think that applies to [00:14:00] everything. And you think about COVID where it's like in the economy for the better part of a decade, every economic debate was, is the Fed going to raise interest rates by 25 basis points or 50 basis points?

And that was how we defined risk. And then COVID hits. And everything shut down for six months. And then you look back and it's like, the average risk that we were spent all the time thinking about, of interest rates, meant nothing. It was not actually a risk. It was the tail risk of COVID that changes everything.

And I think it's true, like, in the economy, once per, the world breaks once a decade. On average, not, not exactly once a decade, but COVID, 9 11, Pearl Harbor, you know, follow the Soviet Union. Once a decade, you wake up and you say, Oh my God, the world is not the same as it was 24 hours ago. And in investing in the economy, that's all that matters.

And everything else that you dwell on in between then, in hindsight, means almost nothing. So I think that's like, that's the, that's the takeaway for tail risks. When 

Brent: you look at the world, I mean, [00:15:00] you mentioned a couple of these things, but you look at the world today and it feels like it's risk on. I mean, speaking of Tim, Tim Hanson and I were talking about this a while back and it's like, it feels like the world was immune.

Like we looked at Bryce's slides, right? It's like the only way that you make all those investments in 2021, everyone's running around buying digital monkeys. Is because you think that this is a world of abundance, right? That nothing ever bad is going to ever happen, right? I remember you and I talking about this.

About digital monkeys. About digital monkeys, all the monkeys that you bought. I'm not going to call you out in front of these people or anything for it. But, um, when you look at the world today, like, what are the patterns of risk that you see, that you've noticed? And kind of what's your general view on, of course no one can predict the future, but over the next couple of years, how do you see these different scenarios playing out?

Kind of using your same three part rubric there. Like what are maybe risks that people you feel like are underappreciating compared 

Morgan: to the norm? Which I think is so interesting about the last three years. The Great Depression in the 30s impacted roughly [00:16:00] everybody. Like some people worse than others, but nobody was unscathed in the 1930s.

Uh, the financial crisis of 2008 was similar to that. Like some people better than others, but more or less everyone took a hit. COVID was very unique in the sense that 2020 through 2020 through today for a lot of tech workers has been the biggest boon they've ever seen. The best three years they've ever had, not even close.

And then for another half of the economy, if you owned a restaurant or a laundromat or whatever it was, it's worse than the great depression. And I think that having that divergence, like that spectrum of opinions has never been wider. Like in the 1930s, everyone would have said this is terrible. Same in 2008.

Whereas I think in 2021, half the world was saying it's never been worse and half was saying it's never been better. And I think that just creates this idea where half the economy doesn't understand the perspectives of the other half. And that's why that's, I think that's one of the reasons you have today.

Unemployment below 4%, stock market still doing pretty [00:17:00] well. You can earn 5. 5 percent on your cash. Like, all these statistics in which things are doing very well, but consumer confidence still in the toilet. I think that's at least one of the explanations. For decades, consumer confidence and economic growth have been very tightly correlated.

Until the last two years and now they've completely diverged. I think it's just because the experiences that people have in the economy are so divergent today relative to what they've been in the past. And I think it filters into politics too, where half the country does not understand the views of the other half.

Completely oblivious and blind to what they're thinking, what they're experiencing, what they're saying. And I think a lot of that stems from just the divergence in what you've seen with, with the economy. But you, you see that firsthand too with your various businesses. Yeah. I mean, we, 

Brent: we, we talked about this, this quite often.

I mean, one of the things I appreciated is like you've got the wide view and then whenever we ask her, like, what do you see? Right. And I've got. We've got views all over the place, right? We've got big city companies, we've got rural companies, and I agree, it's like big divergences depending on the industry, depending on the geography, um, I think it's a big [00:18:00] disconnect.

What do you think is The solution or what, what do you think is going to happen as a result of this over the next years? I mean, we got this divide and it feels like it's widening. We're moving into an election cycle, like hasn't, you know, investors in the room as people who are taking assets and putting them to work.

How should we be thinking about this over the next couple of years? 

Morgan: One thing I think has always been true, but it's more true now than it's ever been is that most financial debates, business debates, economic debates, even political debates are not people actually disagreeing with each other. If, if someone says you should buy this stock and someone else disagrees with that, they're not actually disagreeing with each other.

It's people with different risk tolerances, different time horizons, different views of the world talking over each other. And that's never been more true now. And I think it just creates it. So like you really got to be careful where you get your information from. online because a lot of the opinions that you're hearing about are from people who have experienced something completely different from you have in a way that's given them a totally different risk tolerance, totally different time horizon, very different goals.

One of the biggest problems in investing is that we, [00:19:00] it's taught like a math based field. where there is one right answer for everybody. And if you can just find the right answer, great, you should, everyone should just go do that. And it's, it's created a world where it's pushed people who have totally different risk tolerances into finding the one right answer.

And I think this is one of the biggest dangers of a lot of financial media, of CNBC and whatnot, is that it's portrayed like that. You have a guy who goes on there and says you should buy Netflix, Netflix stock. And I always want to say, like, who are you talking to? Are you talking to a 17 year old day trader?

Or a 90 year old widow? Are you going to pretend like, like, the advice for that person is the same? So in a world where everyone's opinions are so variant because of their experiences over the last three years, you really got to be careful who you're getting your information from. And it's very common for someone who, in the world that they're living in, the business they're running, things are going okay.

Maybe things are going great. And then you read the newspaper, you watch TV, and it's nothing but doom and gloom. And sometimes that's just the way the media works. Other [00:20:00] times it's because the person who's writing that, giving that opinion, is in a, such a different industry than you are. That what they are saying is true for them, even if it's totally different and blind to the world that you're living in.

Brent: Yeah. So your first book, um, was about money having psychology, which doesn't even make any sense. Like, I remember when I first got the book title, I was like, money can't have a psychology. Right, yeah. I mean, it is nonsensical. And yet it sold a lot of copies. How can you explain that? 

Morgan: Uh, yes, thank you. Thank you, Brent.

Uh, what was your business? Adventures? Was that your first? Yeah, yeah, yeah, yeah, 

Brent: yeah. We all have challenges. You don't talk about weird titles? We all have challenges. I was, thank God we renamed. I mean, the amount of times I was asked if we ran a Spanish travel company, it was unbelievable. So, yeah, we all have our misses, okay?

Yours just happened to be a bestseller and mine wasn't, 

Morgan: so. Permanent equity, it's so sexy. Yeah, so 

Brent: sexy. And also, the book though, it was about how we think about money. [00:21:00] And I think that, you know, when I, actually, I'd send you notes about this, like, It really got wide appeal. It really got widely read, I think, because you were able to take these timeless lessons which, again, you've gone on in your second book and talked about.

I don't want to dig into that, but like, these timeless lessons about how to think about money. What were, give people, if they haven't read, you know, maybe the two people in here who haven't read the book, like, what are the top three takeaways you feel like, if you were going to say, sit down and talk to somebody for the first time about, The psychology of money, about what, how to think about money.

What are the top three things you always try to advise 

Morgan: people on? Well, I think, I think three that stick out from the book is number one, kind of what I just said, everyone has a very different life experience. And so for like, and there's, don't be surprised that what works, like the right investing decisions for me might not be the best for you and vice versa.

Not because there's a difference in information or education, it's just, but we're very different people. And by the way, how we invest our money is extremely different. If I invested my money like you, I wouldn't sleep at night. You'd make more money. And[00:22:00] 

That was good. You like that? That was, that was, that was, that was, that was, that was your best line. Yeah. Um. You're welcome. No, but if I invested like you, I wouldn't be able to sleep at night. And vice versa. If you invested like me, you wouldn't be able to sleep at night. Yeah, your returns are terrible. But, you know, so I think, I think because people have had very different life experiences, different goals, different, you know, social aspirations, everyone's, like, is, is going to come to a very different conclusion about how the world works and how they should invest.

That was one of them. The other is, Uh, to me, the highest dividend that money pays that you can use money for is just control over your time and independence. And it's true for businesses, as Bryce just said, like being able to control your own destiny and that. True for individuals as well, where it's like, the knee jerk of what money does for you is it buys nice stuff.

Okay, everyone gets that. The second knee jerk is, oh, it buys experiences. That's, that's the cliche. I think the real, what it actually does for people, how it's going to bring the most happiness is just Independence and control, just being able to wake up every morning and say, I can do whatever the hell I want today.[00:23:00] 

Even if what you want to do is go to work and be productive, doing it on your own terms is totally different from someone else telling you what to do, when to do it, with whom to do it with. That, that was another one. One other that I think is really important is the idea that, like, don't pretend that you or anyone else is rational, because we're not.

Everyone is emotional and hormonal and dealing with different family issues. So I think the best you can do with money is to be reasonable. Like, don't, don't try to be rational, because we're not, just try to, just aim to be reasonable with your money, like, not unreasonable, don't, like, that's not a, that's not permission to do crazy things with money, but, don't, if there are things, if there's an asset allocation that you have, that you know the textbook would say, you can do, you can do better, like, you could be more efficient, on the efficient frontier than this, I, I just don't think that's how people's heads actually work, like, most financial decisions are not made on the spreadsheet.

They're made at the dinner table. And at the dinner table, it's like if you can be reasonable, like that's, that's the best you can do. I think that that was another takeaway 

Brent: from the book. You know, it's interesting because we, we've had [00:24:00] long debates. I remember one time we were chatting, um, you were talking about this idea of like, it doesn't make sense to have your house paid off.

Like, especially when, when interest rates were, were darn near zero. Um, but psychologically there was a benefit to it. 

Morgan: You can sleep better at night. So that's the thing, you know, if you have. You know, back in 2021, when you can get a mortgage at 3%, whatever it was. Paying off your house on a spreadsheet is the dumbest thing you could possibly do.

Makes no sense. I think for a lot of the people who did it though, it's the best money decision that they ever made. And it's the one thing that, you know, they go to bed at night, they tuck their kids at night and it's like, Oh, that's like, this is my house. It's not the bank's house. And if the world falls apart tomorrow, no one's taking this away from me.

You can't, the, the, the, the, the ROI in Excel doesn't, doesn't show up there, but it's massive. So that's the thing where it's like, it's not rational, but it's a very reasonable thing to do. 

Brent: I mean, this actually was a change that I made in my life, uh, as a result of us having conversations. Uh, I mean, truly, like, I, I remember when I went home and I, I asked my wife, I said, you know, how do you feel about us having a mortgage on our house?

And I [00:25:00] think it was literally like, 3. 2 percent or something. And she was like, well, you know, to be honest, it kind of concerns me. I mean, you know, we take a lot of risk in business and something might happen, and I don't know. And I said, well, do you want to pay it off? 

Morgan: Well, she was worried about your ability to provide.

That's what it was. That was good. 

Brent: That was good. I appreciate it. Hey guys, come on, knock it off. It's only when I tell the jokes, okay? Um, Anyway, it truly actually has made a big difference, though. It, it, it really has. I mean, the psychology in our household, I mean, we, we decided to go ahead and pay it off, and I remember when we told the bank we were paying it off, they were, I mean, literally like, what are you doing?

And, it makes a big difference. Um, okay, so, your new book, I can't remember what the title of it is, it's not meaningful. So, um, same as ever. Um, you wrote the whole book about how I will never stop making fun of you on Twitter. Yes. Let's talk about [00:26:00] What never changes? And why does it need a guide? 

Morgan: Oh, how much time do we have left?

I've 

Brent: got plenty of time. All 

Morgan: the time you need my brain. I'll tell you one of the big, like, the moments where I thought, like, oh, this is a book I want to write. I think the best economic book ever written, inadvertently, was a book called The Great Depression, A Diary. It was written by this Ohio lawyer named Benjamin Roth, who was a bankruptcy attorney in the 1930s during the Great Depression.

And he kept a very detailed diary about what he saw was going on in Youngstown, Ohio, where he lived. And his son published it in 2010, of just his reflections on the economy. And he was so observant, so astute, and because it was his private diary, his private diary, he, uh, he just, he just, it was, he really let loose about what he was seeing, and like how people were dealing with the Depression.

It's wonderful, and as I was reading it, there's a, a diary entry in 1932, and as I was reading, I thought if you change the dates on this to 2008, every word he just said [00:27:00] would fit right into 2000. It was exactly what people were feeling and reacting as they did in 2008, two pages later. Benjamin Roth writes, if you change the dates from 1932 to 1894.

It's exactly what happened. And if you change the dates to 1874, the other depressions, it's exactly So then it was like, ah, like, the details change, the cast of characters change, but it's the same movie over and over and over again. Every financial crisis has so much overlap to everything that came before it.

And there's this great quote from Voltaire that I love. He says, history never repeats itself, but man always does. It's like the details are always different about, you know, in 2008 it was credit default swaps, whatever it was. But how people respond to it, man, never changes the greed, the fear, the uncertainty that never changes.

So I mixed that with another just kind of like cynicism that I had from writing about finance, which is like how bad we are at forecasting the next recession, the next bear market. Nobody can do it. We always try. We're never going to give up, but [00:28:00] nobody can actually do it. And so there's two things you can do with that.

You can become more of a cynic, or you can just say, well, look, we can't forecast what's going to change, but so let's put all of our focus and emphasis on what we know is not going to change. The behaviors that have been with us for hundreds of years, that we know no matter what the economy changes, what the next new industry is, who the next president is.

Like we have no idea when the next bear market is going to come, but you know exactly how people are going to respond to it when it does come. So let's put our emphasis into that. So I just wanted to write, it's 23 little stories about things in human behavior that never change. That no matter what happens in the future, you know those things are gonna be part of it.

Brent: So take, take one that you think is your favorite thing that's not gonna change. You didn't read the book, did you? Of course not. Wait, have you, do you expect me to read your books? No, not at all. Okay. Yeah, well, so pick one of them that is your favorite and tell us about it. 

Morgan: You know, one of the things that I think is really true for every, there was this great economist back in the 1960s named Hyman Minsky.

And [00:29:00] back in the 1960s, there was this big surge of scientific optimism. We had just landed on the moon, we had effectively eradicated polio, like, there was a general view, way more optimism than we have today, that if smart people put their heads together, you can solve any problem in the world. And so a lot of economists in the 1960s said, it's time to eradicate recessions.

Like, if you just land on the moon, of course you can eliminate Two quarters of negative GDP growth. It didn't seem like that hard. So, like, how do you tweak monetary policy and fiscal policy to never have another recession? Hyman Minsky said, you guys are crazy, it's never gonna happen. You can't do it. And he came up with this idea called the Financial Instability Hypothesis.

Which basically says, if there's no recessions, people get optimistic. When they got, when they get optimistic, they go into debt. And when they go into debt, the economy is unstable and you have a recession. So the lack of recessions is what creates the next recession. So that's why he said, if you try to get rid of recessions, you're just going to cause a bigger one.[00:30:00] 

He was kind of, he was kind of a quack. Not a lot of people took him seriously, but this is one idea where it's like, oh, I think he was completely spot on there. And I think it's the same in the stock market. If the market never went down, or if people believe that to be true, there's no risk. If there's no risk, valuations go up.

When valuations go up, you're going to get a crash. So the lack of crashes causes the next crash. So I think when you, when you realize that, that calm plants the seeds of crazy. Stability creates instability. Then when you have an unstable world, it's, it's a little bit more palatable. You don't stop and say, who caused this?

Who broke the economy? Like, like, who to, who to blame, you just realize it's a completely inevitable part of how these systems work. And so that's, that's something that's always been with us, that always will, that, that I write about in the book. 

Brent: So if you're, um, some people in, in the room, we've got, uh, quite a few college students here, and a lot of them are, are growing up in an environment, I mean, they went to school in an environment, you've got COVID, you've got, uh, the job market's [00:31:00] not great, like.

Things are not great right now. And I think for them, it looks like it's gonna be not smooth sailing for quite a while. What advice do you have for them, maybe in this time, to think about the future? 

Morgan: Well, so one of the other chapters in the book that's very relevant to that is that the very long history of the biggest technological innovation, the biggest progress in society, however you want to measure it, It happens when the world's on fire.

It doesn't happen when everyone is great and is at full employment and the market's booming. You get the biggest progress when everyone's scared. So the biggest historical examples of this is the most technological progressive decade that's ever existed is the 1930s. The Great Depression. Productivity just exploded during that period because every business in America woke up and said, we need to figure out how to get more productive, more efficient today.

And if we don't, we're out of business tomorrow. So you had all these new inventions, the invention of the supermarket, for example, it used to be in the 1920s that there was. A meat store, [00:32:00] and a bread store, and a produce store. And everyone realized in the 1930s, it's not going to work during the, during the depression.

You have to bring everything under one roof. So you got, there's a million examples of that happening. World War II is another of like, so, everyone's so scared. If we don't figure this out, Hitler is going to run the world. And what came out of that was nuclear energy, jets, rockets, satellite, radar, penicillin, all of these amazing things that would not have happened.

If everyone was calm and happy and sleeping at eight hours a night during that period. So that's we have COVID is certainly going to do this. You have no idea what it might be. I think it's impossible to tell without hindsight, but maybe it's, maybe it's work from home. Maybe it's mRNA technology or whatever it would be, that despite all of the trauma and tragedy from COVID, you look back 20 years later and say, yeah, but we also got this amazing new technology that everyone benefits from.

So there's always, it's hard to say, you know, silver lining from COVID, silver lining of World War II. That's, that's not the way to phrase it, but you do, that's like, that's when you [00:33:00] have these massive. Technology surges. 

Brent: Well, maybe to wrap things up, I want to talk about because at the very beginning of the interview, we talked about this idea of once you find the thing that you love for you, it's been writing, you just do the same thing and it produces great results.

How do you advise people who maybe think they haven't found that? right thing yet. How do you advise they go about finding it? How did you end up finding it? Is there any lessons that you can part on them? 

Morgan: Well, see, it's interesting. I started as a, as a writer in 2008 and the economy was of course on fire.

I didn't want to be a writer. I wanted to be an investment banker or work in private equity. And I took a writing a job as a writer at the Motley Fool out of desperation, not because I wanted to do it because they were the only ones who were hiring. And I think, and then, the first year I did it, I didn't enjoy it, I had no, I had never really written anything before.

But you worked for Tim. I worked for Tim eventually. Oh, okay. But I really, I really didn't enjoy it, it was just a job, I needed a paycheck to do it. But then after a year or so, I really started, I loved it, and really fell in love with it. And the fact that [00:34:00] it was never planned. I never, it was not, it's not what I studied in college.

I never, never had a vision. It was just a serendipity stumble into this on accident. I think actually a lot of careers are like that. And of course, when you're in college, great to have ambition about what you want to do. A roadmap of what you want to do goals. That's all great. Nine out of 10 people that will eventually find their career from.

I think there's a lot, there's a lot, I think it takes a lot of the pressure off of when you're 19 and you have these grand plans, I need to hit this goal and then that milestone and what not, most of the time it's, it's, it's not, it's not the career you're actually going to end up with. Great experience and what not, but.

Letting it flow a little bit. The other thing that's important for young people is that if there's ever a time in your life to have a weird job, it's in your early twenties, not when you're 44 and try and have two kids and, and a mortgage. Like, so if there's a time to work for the weird company in the weird role, do it early because you're, you're, you're not, you're not going to be able to do it when you're, when you're settled down in your forties.

Brent: Yeah. I mean, I, [00:35:00] I obviously, my career would echo that. I mean, I joke that I'm the Forrest Gump of private equity, had no idea that I was going to get into this thing. And, um, It's been beautiful. So in all seriousness, I razzed you a lot. I just want to finish and you don't know I'm gonna do this, but I just want to say thank you for your friendship.

Um, it really has meant a lot to me and uh, I admire the heck out of you. I'm grateful for you. I'm grateful for your here being here. So I just want to say thank you. Give me a round of applause.

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