Morgan Housel on gambling psychology, the publishing power law, housing supply, and the purpose problem in retirement

Speaker 1: Our next guest is Morgan Housel. He's been on the show once, twice. I think this is third time. Fourth time? Maybe fourth time?

Speaker 2: I think fourth.

Speaker 1: Back

Speaker 2: more. We'll let we we got it back going now. Okay.

Speaker 7: Hey, guys. How are you?

Speaker 1: Yeah. We start with sports betting? Is it an epidemic? How do you think how how has the sports betting boom and the gambling boom and the hyperfinancialization worked its way into your thought process and your work generally?

Speaker 7: I have two takes on this. One that's been talked about by a lot of people is that this well known idea in psychology that if you think all of your options in life are bad, you become very risk seeking. Yeah. And so if you feel like you can go to go to college, get a degree, work hard, get promoted, buy a house, you'll do that. Mhmm. If you don't, you'll start trading zero day options. Mhmm. That that that makes sense. I believe that. I could also argue the other side, which is that if my generation, my parents' generation, our grandparents, if they had access to all of these things, they would have done the same thing.

Speaker 1: Oh, sure.

Speaker 7: They would have done like, it's not it's just because we have these tools now that we're using them.

Speaker 2: Yeah. It's such a classic When like the image of like a boomer in the Vegas like airport just, you know, hitting hitting the button over and over and over is like sort of like an iconic image in my mind and I think that's proof to what you're saying which is like, you know, if if everyone had a casino in their pocket for the last hundred years, then probably every generation would have been gambling at a pretty high rate.

Speaker 7: We're the same. I mean, for my generation, when we were teenagers, the the new thing was was day trading because before that, you had to call your stockbroker and pay him $200 to make a transaction. Now you had E*TRADE and Charles Schwab. You could do it for free or nothing. And so all of us, like when I was 17, we all started day trading. Every one of us did it. It wasn't about the economy. It was just the tools we had in front of us.

Speaker 1: How do you think about loss aversion in the in the in the gambling, in the in the world where you're doing these like crazy parlays? Because there's been all these studies that show that people have more negative feelings about losing money than the good feelings that come from making money. This general idea of loss aversion, if you lose $10 you're going to feel more pain than the joy that you would equivalently feel from gaining $10 so people are generally loss averse. And yet gambling seems like a formula for like endlessly triggering that loss aversion and yet we don't see that actually play out.

Speaker 7: And then you also have this other concept of house money where like if you do win, it doesn't it's not your money that you earned from your paycheck and you're much more likely to take higher risk from it from And you you see it with loss aversion in people's lifestyles as well. If you go from a Honda Civic to a BMW, it feels pretty good. If you are forced to go from the BMW back to the Civic, it's the worst feeling you could ever possibly imagine. Will Smith talked about this with Fain. He was like, becoming famous is amazing. Being famous is okay. Losing fame is the is the hardest pain you could ever experience.

Speaker 1: Woah.

Speaker 7: And so I think there there's a lot of things in life that are like that where you're taking risks, and particularly, like, when you know, as a matter of fact, that you're gonna have losses. That's just that's just coming with it. And if the losses are gonna feel 10 times worse than than your gains, it's gonna be it's gonna be tough. There's so many of, like, the best hedge fund managers, stock traders, the people who've actually done extraordinarily well over years and decades. Mhmm. And you look at their track record, and they might be right 55% of the time. Right. Maybe, like, 65% of the time if they're incredibly good at what they do. And so really what their their skill is is they became very comfortable and level headed losing money. That was how they made money over time was paying the cost of admission of just dealing with that volatility and loss.

Speaker 1: Yeah. I've I've been disappointed that a lot of the folks that I know that participate in gambling refuse to take my advice and invest in the gambling companies just buy the house. Yeah. Because some of the some of the gambling stocks you you know, you like the industry, hate the industry, but some of the gambling stocks have been very performant and it feels like it should be the solution and yet it doesn't have the same psychological impact of the quick wins that come from actually playing. Shifting gears a little bit, I wanted to ask you about the publishing industry, the non fiction industry. Tim Ferriss put out a blog post asking the question, has AI already killed how to non fiction? And he tells a story about his books and he says that on the 2026 run rate, he's down 57% on sales of books. And he sort of attributes that to some of his books being substitutable with LLMs, just the idea that if his chef, a four hour chef book was a bunch of recipes and you can get those directly. And I'm wondering about how you think the the publishing industry, the book landscape, there's also this piece in the Atlantic about people just not reading in all anymore. Yeah. What are you thinking about where we are right now in terms of the publishing industry and where we're going?

Speaker 2: The only thing on to The piece in

Speaker 7: the Atlantic. Sorry.

Speaker 2: Yeah. The only thing I was gonna say is like the the decline in sales like coincides with him just putting way less time into his podcast.

Speaker 1: Oh, sure. So he's maybe driving less sales?

Speaker 2: So so like you have to imagine him not fully pricing in just having one of the biggest podcasts in the world. Yeah. And And then just drive more. Slowly doing like, you know, more competition plus putting less emphasis Yeah. Into it. But What do you think?

Speaker 7: I think I think you're probably onto something there. I was gonna point out Mel Robbins whose book will sell eight zillion copies this year. That's that's non fiction self help. It's the exact same genre. Yeah. And she's blowing the doors off right now.

Speaker 2: Yeah.

Speaker 7: And so I think for every example that you put in what what's true is that the book industry as a whole, and particularly nonfiction, has not had a very good three or four years, a lot of which was because 2020, twenty one COVID lockdowns was just an explosive bonanza that everything by comparison to then is is is not that great. But I think there's a there's a thing too with with podcasts and long form writing in books where it's easy to say that people don't have attention spans these days. They want short form video, and that's they just want to flip through it, that's it. And it's like, no, the biggest podcast in the world are like three hour conversations that people listen to all the way through. Yeah. And so I think it's not that people don't have attention spans. They don't have a lot of tolerance for BS in the way that they used to. So I think thirty years ago, people would slog through a bad book because they had nothing else to do that day. Whereas now, if you start a book and it's bad, you're like, I got 20 other things competing for my attention over here. I'm going to go there. So if you're still putting out the kind of content that is engaging and interesting and saying something new, people will buy it, they'll listen to it, they'll put effort into it, they'll listen to it for hours, that's that's still there.

Speaker 2: Yeah. It's crazy how captured audiences were thirty years ago.

Speaker 1: Mhmm.

Speaker 2: It's like you or let's say like pre internet, but it's like if there's nothing on TV that you're excited about Mhmm. There's nothing on radio that you're excited about and you don't have a book physically in your home and it's like 8PM, like you're kind of like just choosing between options that you're not that excited about. Yeah. But then now it's, like, truly infinite possibility. No one Yeah. Feel like people are bored anymore. Right?

Speaker 7: Yeah. Yeah. And I think it's I think there's there's a lot of times when people what they think is impatience is actually just a newfound intolerance for BS in content. Think there's a lot of that.

Speaker 1: Interesting. Yeah. I was in a bookstore recently and the the the power law of publishing is fully on display because you walk in and the the Mel Robbins book, for example, will be shoved in your face with a massive display and tons of copies. And then if you're actually looking for a book, you have to find the section and it's much harder to dig through. They might not even be in stock. And I would I would have assumed that the Internet would sort of flatten that and lift the tail, but I guess there are power laws everywhere and so certain books go viral. What I'm interested in is this idea of like there are certain authors that publish a book every year and they sort of just base hit, base hit, base hit. And then there's another version of that playbook which is have one really defining book but then continue to franchise it, promote it, add on to just continue to drive sales. And I think that's what Jordy was alluding to a little bit about you have a podcast and you can drive sales to your existing catalog even if you're not publishing new books.

Speaker 7: Yeah. I think that power law exists even among the tippity top authors. Stephen King has written like 50 books, something like that. Yeah. And most of his sales and most of his fame came from like three. So even among and like, you you have people like Michael Lewis

Speaker 1: Yeah.

Speaker 7: Who's written, I don't know, I'm gonna guess like a dozen books, something like that. And I bet most of his income, sales, and fame came from two or three of them. Mhmm. And so some people have a better hit rate than others, but even among the best. Listened to an interview yesterday with Matt Damon. Same thing in movies. He's made dozens of movies most of us watching this have never heard of before. Yeah. And so that you see that you see that everywhere. I remember James Clear telling me several years ago, there's 4,000,000 books for sale on Amazon. Mhmm.

Speaker 5: And if

Speaker 7: you look at the top five, the top five of the 4,000,000, it's possible that number one is selling 10 times as many copies as number two.

Speaker 1: Yeah.

Speaker 7: So even it's like it's a 4,000,000 thing and even among the top, the the power law just gets crazy.

Speaker 1: Yeah. I think it's the same thing with podcasts. I think Rogan is like an order of magnitude bigger than everybody else Spotify. Jordy can't name a single Matt Damon movie. Born identity. There you go. Oh, yeah. That that is the series that you like. Matt Damon also famously passed on Avatar and he was like, you would have made so much money from that. But James Cameron said like, the movie, it's not a Matt Damon vehicle. It's a it's just a it's a movie that the idea exists regardless of

Speaker 2: there has there been a a book written on the power law, not the the venture book? The power law?

Speaker 1: The book

Speaker 2: on just like every single place at the power law? Because I'm wondering like Interesting. Is does power power law apply to marriages where like the best marriages are actually 10 times better than, you know

Speaker 7: I would assume I would assume it does. I think it's one of those big things that's going to influence everything in life. And it throws a lot of people off because it's like you can be extremely good at what you're doing. Like, if you are a really good college basketball player, you might be significantly like, there's the the difference between that I I what what was the story I'm thinking of? It was someone it was an NBA player that people were harassing because he he was having a really bad season. He went on a podcast and he was like, the difference between me and you is so much bigger than the difference between me and LeBron. It was like, once you get to that level, like the Oh. And so you see it everywhere.

Speaker 2: But couldn't you make the argument that no, the difference between you and LeBron actually I guess it's the difference still could be bigger, but it could be

Speaker 7: I mean, I I I don't when when I was a my my sport growing up, I was a ski racer, and if you were a really really good regional skier, you were not in the top 100 nationally, and you were not in the top thousand internationally. It just it got and I think it's that it's it's it's it's like that from those sports.

Speaker 1: Cow Are are you what you're thinking of is Algorithms to Live By, the computer science of human decisions by Brian Christian and Tom Griffiths. It takes well known computer algorithms and then applies them to everyday life. So a good example is the 37% rule for choosing. This is like known as the secretary problem. But when selecting amongst a fixed number of options, apartments, job candidates, even potential partners like marriages, spend the first 37% of your search observing without committing and then choose the next best option that is better than everything you've seen before and you will almost you'll be like mathematically optimal. And it takes all these different algorithms and applies them to everyday life. It's a fun book.

Speaker 2: In parenting, are are you do you spend any time thinking about or trying to identify where where your children might have might be 10 times better or the potential to be 10 times better at something than their than their peers. Because I look at it between between my children, even even looking at athletic abilities, I think it's already like completely noticeable who's like the better at least natural athlete and I believe that that will probably carry through throughout their whole life is my is my intuition. Not to here's my

Speaker 7: here. I not not for my kids. Let me tell you a story. When I so I I was a skier growing up, and from my generation, there were two skiers who became head and shoulders above everyone else. Lindsey Vonn and Ted Liggety. They both won Olympic gold medals. Everyone knows Lindsey Vonn now. When Lindsey Vonn was six years old, she was in a different universe of everyone else of of of talent. She was just it was so obvious from the time she was a small kid that she was just the best out of anyone. Ted Liggety was not that. He didn't hit his stride till he was, like, 18, which was so, so rare. And so I I always it's it's it's always interesting that, yes, there are some people from like from a very early age. Tiger Woods was on TV golfing when he was like two as as a talented golfer, and so there's that, but there's also these people that just don't hit it until late in life. Those are always interesting. A lot of entrepreneurs like that that don't really find their stride until

Speaker 2: the But with 30 year Ted, is it possible that he just didn't care enough until he was late in his teenage years and prior to that, like, was always that good but just never put the effort in or the time?

Speaker 7: I think this might boast me, but I think it's so fascinating. One of the things with Ted is that there are rules about the kind of ski gear that you can use for racing. Like, have to meet these these sizes and whatnot, and they changed the rules at one point so that your skis had to have a certain side cut. Ted was the first person in the world who figured out how to ski on the new skis, and he just completely dominated everyone else for several years after that before they kind of caught up. So there's there there there's some of that that was interesting. But I think for I think that's the rare one. I think to your point, the Lindsey Vonn story is more common when from a young age, they are just so preposterously better than everyone else.

Speaker 2: Yeah.

Speaker 1: I want your reaction to this chart that Joe Wiesenthal, a friend of the show shared, and we will have the team pull it up. It's the percentage of US household net worth over time. And for a long time, real estate was the dominant place where American households held their net worth. But for the first time, we are seeing that households are increasingly holding equities. Cash and cash equivalents peaked in the eighties and is sort of declining around 10 of household net worth, but equities have been completely up into the right. Maybe it's just a temporary dislocation in the stock market. The stock market is doing very, very well. Houses are more expensive, so households are preferencing that. But I'm interested in your take on what this says about US households, but also the psychology of what it means to hold a, you know, a larger percentage of your wealth in equities versus your house.

Speaker 7: Yeah. We always talk about, like, the stock market crash in 1929, and and I I think the the statistic was 5% of Americans owned stocks in 1929.

Speaker 1: That's right.

Speaker 7: So we had like, we we talk about it as, like, it started the Great Depression, but it was it was such a small number of people that actually got hit by that. Yeah. Whereas today, think the status 55% of Americans own stocks, the vast majority of them in their four zero one k.

Speaker 1: Yeah.

Speaker 7: Now and and part of that, like, if you're an investor for the long term, the odds that you're gonna experience a 30% decline or even a 50% decline are are almost a 100%. That's just how markets work over time. Yeah. And does the do does the general population of just, ordinary Americans who are not watching this and listening to finance podcasts and reading finance books, do they have the stomach for that, or do do they even know that that's the game that they signed up with for? I think by and large, the answer is no. And even if you do know it, knowing it and experience it in in real time can be completely different. The one thing is that, like, stocks have been over time. Nothing is promised in the future, but generating real growth above the rate like, well above the rate of inflation. Real estate is something completely different where, particularly if it's the house that you live in, not a rental that you have, I I I think we've done a lot of damage to Americans by convincing them that rising home prices are a good thing and they make them wealthier. And it is such flawed math because if you buy a house for $500 and then sell it for a million, how much money did you make? Yeah. Well, for most people, once they sell it, they have to buy another house that also inflated in value by two x over the last same period. So you didn't probably didn't make anything. And so I I think there's a lot of, like, it looks like wealth on paper with real estate, but it's just a place to live in, and you have to exchange it for another place to live in, and you didn't really make that much over time. So maybe if we're talking real wealth over time, it's a much better situation that we're that we're in now.

Speaker 1: Yeah. I am interested about I mean, I I know some people who bought in Mill Valley, like, years ago, decades ago just because that was a logical place to buy and it was a nice community. And, of course, the house prices are insanely high with the AI boom with San Francisco booming. But there isn't a logical like, oh, yeah, of course, they'll move to Florida at some point because that's not really what people do culturally. If you are in California, you sort of just retire in the town that you grew up in or live in Yeah. And raise your kids in.

Speaker 7: If you can do that, if you can sell in Mill Valley and move to Oklahoma, that's great. That's real wealth.

Speaker 1: Yeah.

Speaker 7: But if you sell in Mill Valley and buy in Mill Valley, you can make anything.

Speaker 1: You're not doing anything. What how do you how are you do you ever think about, like, the different prescriptions for solving the housing crisis? We're having Sagar and Jetty on the show tomorrow to talk about it, but I'm interested if there's if there's anything that you have that you've dug into, whether it's through the abundance or permitting or anything that stuck out to you as particularly exciting around the way America deals with housing broadly?

Speaker 7: I think I mean, it's simple, but it's but it's not easy. It would it would be around permitting and building more. There's obviously demand for more. There is the ability to build more. It's just that in the vast majority of cities, it's virtually illegal to build where people wanna live or at least extremely difficult. And it's one thing to say, you know, build more homes. It's another if you're a home developer in California and you wanna go build 200 homes, you're gonna be waiting in line for years and paying a fortune to actually build that if you can actually get it done.

Speaker 1: Yeah.

Speaker 7: And and so I think the idea that, you know, there's a great saying by Connor Senn, who's a great thinker, around these topics, he says, the future is a policy choice. And the reason that home building is so scarce and we don't have enough homes is because we've made a choice to be in that situation. There's no like, it's if you were left to its own devices, it would be solved not that, you know, in in due time. And we did this similar situation at the end of World War two when you had 16,000,000 soldiers come home. There were not nearly enough homes for them. Yeah. But at the time, it was much easier to build than it is today. And so you had things like Levittown that sprung out of the middle of nowhere, and they were building 25,000 homes in a year. And you solve the problem in due time. And so it's it's simple, but just politically much more difficult to say, like, yes. I think by and large, it's permitting. It's not a it's not an exciting answer, but we've made the choice make it difficult to build where people wanna live.

Speaker 1: Yeah. For for those who don't know, what what is the actual story of Levittown, and and can that be replicated today? I was I was in Irvine, and it feels like a very planned community. Of course, most of that town was built maybe a hundred years ago, but just driving around and seeing so many apartments and houses, it felt like this could be replicated, but I don't I'm not exactly sure how far it

Speaker 2: would be. Yeah.

Speaker 7: It was the end of World War II, and there were like I said, there were all these soldiers who needed homes and buying like, most of them a lot of them moved back in with their parents

Speaker 1: Sure.

Speaker 7: Which is not what you wanted to do coming home from war. Yeah. And the Leavitt brothers were homebuilders. They started buying up abandoned farms Oh. In New York and Pennsylvania. They basically took what Henry Ford figured out for cars, which is like, you have to make the manufacturing process, like, very step by step Yeah. And every person has a specific step that they do all day long. And they they made very small, very cheap, not high quality homes, but they could just bang out tens of thousands of them. Yeah. And and it it it between that and, like, the GI bill that helped finance a lot of those homes, I don't think it's an exaggeration to say. Like, it saved that generation who came home and had nothing, and within a couple years, allowed them to have a good dignified life going forward.

Speaker 1: Yeah. I've been surprised that we haven't seen more spreading out of basically, like, longer commutes or longer distance commutes because we're on the cusp of self driving cars. Even just a basic Tesla Model three has self driving that can make an hour long commute much more palatable. And then you also have telecommute and a lot of companies have like a work from home Friday policy or some flexibility around that. And I was expecting that there would be some alleviation from the pressure. Like when I look at the home prices in San Francisco and then I compare them to the the or the rental prices in San Francisco, $4,000 for a one bedroom, and then I look over in Oakland, I'm like, I I'm surprised that we're not seeing more flattening out. But I think that there's still a huge demand for being in the action in a particular area, in a particular town, and even in a neighborhood, and so there's been a lot of pressure on, like, the the highest value areas. I don't know.

Speaker 7: I'd say there's also been a big inflation of expectations over time, which is what you want in society. Want people to expect to expect a better life. Mhmm. But when you talk about Levittown, the houses that they were building back then that were so great for middle class Americans in the forties and fifties would not be considered a livable house today.

Speaker 1: Yeah.

Speaker 7: It was it was 800 square feet for your four or five kids who all shared one bedroom. You had one bathroom for the six of you. No garage, no deck, no air conditioning. Like, go on down the list. Most people would not consider that an acceptable place today. And, again, I whenever I point that out, I have to say, I wanna live in a world where people have higher expectations over time. That's progress. Yeah. But it's not comparable over the generations.

Speaker 2: Yeah. Jordy? I do too, but at the same time, when I moved to the city that we're in now, I had an extremely long commute and a terrible apartment and

Speaker 1: I had a real roommate

Speaker 2: at one point. I think it's

Speaker 1: just I think the same room as me.

Speaker 2: Well, I think it's I think it's like Yeah. The life that people want is immediately available on social media to them to view at all times Mhmm. There's I think like a decreased ability to delay gratification. Because I remember growing up, I'd travel to somewhere and I'd see like a really big yacht and I'd be like, wow, that's like, yeah, pre internet. You're like, oh, I've never, you know well, guess not pre internet, but like, you know, there wasn't like the first time I saw a yacht, I'd probably never seen like an Instagram video of some athlete doing a backflip off of it. I was just like, oh, that's a totally different like life.

Speaker 1: At the same time, like, I watched MTV Cribs and stuff. I don't know.

Speaker 7: Yes. I was just I was just gonna bring up MTV Cribs, which had such a profound cultural impact on my journey because that was the only view into how the other half lives. Yeah.

Speaker 1: But what

Speaker 7: and it was I I watched every episode of that show when I was younger. Wow. But what's but was but what was so important about it is that you did not consider those people peers.

Speaker 1: Sure.

Speaker 7: You're like, that's that's that's master p. Of course, his bathroom is made out of marble.

Speaker 2: Like,

Speaker 7: that's not a peer of mine.

Speaker 4: Sure.

Speaker 7: Whereas today, on social media, you see the yacht and you see the person and you're like, that guy, like, he he's supposed to be a peer. Like, I'm supposed to be there. Yeah. And so the fact that it was an obvious celebrity or an athlete and that, like, Shaq had a 12 foot bed, you didn't expect to have that yourself.

Speaker 2: My favorite my favorite example is, like, the GT three RS is, like, the most, if you ask like a 21 year old guy, what car do you want? If you just get any car right now, a lot of them would say GT three RS. And so that's my favorite example when talking about personal finance with, you know, people that I know in my life that are just starting their careers is I'd say, like, you know that car that you see and you just assume, like, if you work hard, you'll, be able to, you know, get a GT three RS because that's a car you wanna drive on the weekend? Well, you need to make if if you wanna buy that car, you basically need to make $850,000 in one year in California and be willing to spend the entire amount after taxes that you make just on that car and not have any other expenses for the year. So that is what that car that is the actual cost of that car, but it's just like put into their face all day long to the point where people just assume like, okay, like, if I work hard and I do a good job in life, I I should be able to get a GT three RS. And it's like Yeah. It's just so normalized.

Speaker 1: I just found one for I just found one for 50 k. It has this is not a salvage title. It it has six owners, Florida. It has aftermarket wheels, but it's doable.

Speaker 2: It's doable. Okay. You have

Speaker 7: you have to pull it

Speaker 2: out So if you make your six figs Yeah. And then you spend your entire salary after taxes.

Speaker 1: Only four accidents. Anyways, Mark Still runs.

Speaker 7: No. I was gonna say, I think I think tech has has done so much to expectations over time. I was in Tahoe this week with my family where I grew up, and we were driving past, and the biggest, most beautiful house in town, this mansion in town, it's so beautiful. And I told my wife, said, you know, the people who lived there when I lived here back in the nineties, that was an orthopedic surgeon. And we're like, there is no way an orthopedic surgeon could afford that house today. That house would be a tech CEO's house. But back then, orthopedic surgeon was the highest earner in town. There were there was there were no product managers at Google making $8.50 back then.

Speaker 1: Sure.

Speaker 7: And so it it created what we used to think of, like, jobs that every town has, dentists, doctors Yeah. Lawyers, those kind of things used to be number one. Now they're number 47 on the earners in town.

Speaker 2: Now you

Speaker 1: gotta do orthopedic surgery SaaS. If you're the founder of an orthopedic surgery SaaS product, then you get the house. It's the same thing. Exactly. Or dental SaaS or something like that. Yeah. No. It really has been like a crazy, crazy boom. It's driven up everything all over the place. Jordan, anything else?

Speaker 2: Do you ever plan to retire? I

Speaker 7: think it depends. I always think the purpose of financial independence is to get to choose your problems Mhmm. Because you're going to have problems either way. And I was talking about this with someone earlier, of people who sold their business. I don't know if you guys know two people who sold their business recently. I don't know. But the number of them who went on to regret it, and the reason is this apply to you guys is because they left their business and they realized on day one, like, that was their purpose.

Speaker 2: That was

Speaker 7: their purpose. And once they loft it, that was their identity. And they woke up the next morning with tons of money and no purpose.

Speaker 5: Mhmm.

Speaker 7: And I would say, if you think work is hard, try boredom. It's way harder. Mhmm. It is way more psychologically taxing than hard work. People want good problems in life. Yeah. And so retire no. I I'll I'm I'm doing I I work very differently now and do a different level of Yeah. Less work than I did five years ago, but I'm still doing things to keep myself busy because if I didn't, I would slip into boredom and then probably depression very quickly. So I guess to answer your question now.

Speaker 1: Yeah. Yeah. There's some formula. It's like how much you should invest in bonds is like your age minus one one hundred minus your age or something. It's like how much free time you should have should be like 100 minus your age. So when you're 20, you're working 80% of your waking hours. But when you're 50, you're taking half the time off or something. I don't know. There there there's some, like, you know, you wanna have some sort of balance. You probably can't go hundred hour weeks into your eighties unless, I don't know, maybe somebody will, but

Speaker 7: It's a big problem because in finance, we spend so much effort making sure people have enough money to retire Yeah. And focusing on that number. Yeah. And no time whatsoever asking the question, what are you going to do once you're retired?

Speaker 1: Sure.

Speaker 7: And for a lot of people, they retire, they got plenty of money, they saved their whole life.

Speaker 1: They don't know

Speaker 7: what to And then after two weeks of retirement, they wake up and like, who am I? I I don't even know what I am anymore. What's my identity? What's my purpose? And if they retire at 60, they might have another forty years to live.

Speaker 1: Yeah.

Speaker 7: Like an entire extra life to live doing nothing.

Speaker 1: Yeah. Long time. Nurburgring Track time. Sub seven minutes. Make it happen.

Speaker 2: That That'll be John.

Speaker 1: That is

Speaker 2: It'll be the it'll be the 80 year old on the on the track.

Speaker 1: He's shaving off milliseconds.

Speaker 2: Alright, grandpa.

Speaker 1: I don't think it's put you to bed. Think I'd have a disadvantage forever. I don't know. Maybe I

Speaker 7: I'm glad Let me let me flip that around to you guys. Young guys, successful, sold your business, do you think you'll ever retire?

Speaker 2: No. Absolutely not. I saw my my my late grandfather was sharp as a tack until about three months after he retired. And I think that I think that the daily habit of just putting putting in work, you know, using his mental capacities. Yeah. I would like to was contributing to his longevity. And to me to me, the you know, building companies is like an act of creation and there's nothing as as satisfying or enjoyable to me in this whole world than creating. Yeah. And so to me, it's like it's like Not going anywhere. You're asking an artist like, do you think you'll ever stop like, you know, making art? Yeah. Yeah. You might you might dial it back, you might do these different things, but No. I'm I'm so fascinated to I I I like I like to imagine, like, if I was 80 years old right now, living the same life, what what would I be choosing to work on? What what ideas? And I I think they'll be quite I think they'll be quite different than the things that are interesting to me now. Yeah. But I look forward to

Speaker 7: figuring would say, out like, there are some fields that I really admire when people quit while they're ahead. Whether it's like Seinfeld in 1998 shows On Top of the World and he's like, no, we're done. That's I've given it all to our team. We're out of here. But he didn't retire. He's still on tour today doing a million other things.

Speaker 1: Yeah.

Speaker 7: And so the ability to say, I could probably squeeze more juice out of this career, whatever that career might be, but I'm proud of what I've achieved and now I'm going to go do something else. It's not retirement, but I admire that versus you could easily imagine a history where Seinfeld went another ten seasons, it sucked, and it just kind of, like, died on the vine. Can easily imagine that history, which is kind of what the Simpsons have done over the last twenty years. Right? And so I I I really like when people quit while they're ahead. Think it's really admirable.

Speaker 2: Yeah. There's also something there's like a kind of business that can only be started by someone who doesn't need it to work, basically. And you see this with startups where, like, you know, an entrepreneur will have an exit and they'll start working on something and then they'll just be toiling in obscurity for years and and, you know, and and eventually they can build something valuable out of it. But a young entrepreneur wouldn't necessarily do that because they're like, have to I have to make the SaaS so that I can raise the next round, so I can, you know, do all these different things. And so, I also think it just changes when you when you have like if you can set yourself up to be able to take more risk, there's interesting businesses to be built.

Speaker 7: Yeah. I forget who said this years ago. May have been Mike Salana. I might be getting that wrong. But he said, like, the number of founders founders that he's met who sold their business, cashed out, and then they said, I'm gonna take two or three years off to just chill Mhmm. And ski with my family and hang out, and then I'm gonna come back. And they come back after three years, and I think the way he phrased it was, like, every one of them is so smooth brained at that point. Like, you just lost it. Like, you just atrophyed. They lost the edge of what you had. And so the idea too that it's a muscle that you got to keep going or else it's just going to wither away is important too.

Speaker 1: Yeah. Yeah. It seems like the there are there's, like, a different set of challenges that the post exit founders can take on that that that works. But if the if the business requires, like, having really, you know, like like, firm contact with, you know, a large swath of consumers and you haven't been to the store in four years because you now have a personal shopper, like, you might be out of touch there. But if you're solving some sort of problem on the, like, geopolitical level marshaling billions of capital and it's like that was an opportunity that was only open to you after you exited, then that becomes something that's you can accelerate into a little bit better. But it's Yeah. It's it's sometimes hard for people to go back into the garage if the if the startup idea requires those like garage years of like prototyping something at a very low level and like going zero to one on something that's so niche and so requires contact with like, you know, broad reality.

Speaker 2: What do you think the value of vacation vacations is? Because to me, like, I went I went like a I basically, you know, I'm 30 now, my twenties. I probably didn't take, you know, more than four days off, you know, at any point in my twenties. And I used to think like, wow, I'm stressed. I should like get away and like but ultimately, that would just try to create that would, in my experience, create more stress because I'm like the thing that is causing stress, I'm not addressing head on and and solving, but I'm curious in your life what you feel like, you know, what benefit you feel like you get from vacation because I don't think, like, stressed people going on vacation, like, solves stress.

Speaker 1: Mhmm.

Speaker 7: No. If anything, it's because if they actually detach on vacation, then they come back and they have 47,000 unread emails and just more problems piled up in there. My my

Speaker 2: is not necessarily even healthy to be like, I'm just gonna ignore the problems in my business or whatever for four days, and then it's like, you may as well just go on a bender or something like that, you know?

Speaker 7: Yeah. But I do think it's true is that for a lot of people, the reason that they actually go on vacation is because they have to travel somewhere else in order to justify detaching. If they just stayed home and detached, they would feel some sense of shame. But if they're like, oh, we're going to Maui, so now I'm gonna detach Mhmm. It gives them the excuse to do that. Because, like, is being in Maui actually that much better than being back at home? Like, it it there there are aspects of it, I think what you really enjoy is giving yourself permission to be someone else and to be on a different schedule that you could not bear if you were just staying back at home. Mhmm. My wife doesn't like traveling. She's totally she likes she likes being at home, and I think this is part of her philosophy. If, like, people don't actually like traveling, they just don't like being at home. And if you enjoy being at home, your desire to actually do it really diminishes. I travel a lot for work, so I don't have a a ton of desire to my my idea of a vacation is not not getting on a plane this week. Yeah. But I think I think it tends to be true. I I've used this example before of, like, if I'm building sandcastles with my kid on the beach in Maui, and that's a 10 out of 10, being at home playing Legos on the living room floor is at least a nine. Yeah. But what I actually enjoy is is time with them. It's not flying for seven hours and spending $10 on the trip. It's spending uninterrupted time with the family. But back to the original point, think you have some people have to vacation in order to have uninterrupted time with their family. It's impossible any other way.

Speaker 2: Yeah. Yeah. When after kids, the idea of like a seven day trip to Hawaii. I'm like, so you want me to go through two days of just like pure chaos Mhmm. And suffering for everyone in the family where the kids are uncomfortable because they're going to the airport and they're in the airport and they're on a plane and they're waiting around and then and then it's like sort of you bookend the experience. And so you're like, you come out of it not necessarily like to me, I because I don't come out of trips feeling like

Speaker 1: Just take a boat. Turn it into a three month trip.

Speaker 2: There you go.

Speaker 1: It's probably better. Boats

Speaker 7: are wife absolutely my wife has this thing too where she says the best part of every trip is coming home. I think when we do go on vacation, it gives her a newfound appreciation for home. After you've been in a tiny hotel room and then you come home, your kitchen feels like it's the biggest thing in the world. The bathroom feels like it's the biggest thing in the world, and you appreciate what you already have more. We were joking last night, not seriously, but we're like, we should intentionally take worse and worse vacations. We should appreciate home that much more.

Speaker 2: Wait. We we have a we have a buddy who at least historically would take a would like get a round trip flight over the course of a day if he needed to work on something. So he would he would like just fly to some random basically book like a $200 round trip ticket

Speaker 1: Lock in.

Speaker 2: And just to get like something done that they were avoiding. Wow.

Speaker 1: That makes that seems like there's much easier ways to do that. Drink a coffee or something. Anyway, thank you so much coming on the show, Morgan. Great catching up. Yeah. Great to see you. Have a great summer. Have a wonderful summer.

Speaker 2: Take care.

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