The Art of the Mailbag

Sports, investing, and character. Crypto without the currency. Kudos for Candy Land. And of course, your pet peeves. This month’s episode of mailbag on Rule Breaker Investing is unlike any other. Just like all the others.

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This video was recorded on Sept. 29, 2021.

David Gardner: Every mailbag is different, and every mailbag is the same. Every mailbag is different because every question is unique and while some of them will overlap from one month or year to the next, a classic question like, “How many stocks should I have in my portfolio?” being an example. Nevertheless, each question comes from a different person with their own unique view of the world, their own risk tolerance, their own time horizon. Then two, one mailbag comes after a great month for the market, while another mailbag comes after a bad day for the market. These rhythms and undulations guarantee that each mailbag is shaped in part by our circumstances. Creatures of their times. Every mailbag is a snowflake, every mailbag is different, and every mailbag is the same.

Generally, 6-10 points, all of them sourced from you, my dear listeners. We’re a community, are we not? Which is Foolish and building every month and we exhibit consistently recurrent good humor, recurrent insights. Your questions always bring a smile to my face and sometimes challenge me. I bring in Motley Fool analysts like this week’s Aaron Bush and John Rotonti to help us all think deeper or round out the answers over and over again and the aim, the same, to always to make you smarter, happier, and richer. Every mailbag is the same and different too. This one more than any I can remember, is built on the bones of, well, I featured my own earlier this month, it makes sense on the bones of your pet peeves. Yeah, I shared mine. Now, you are sharing yours in an among discussion of inflation, cryptocurrency, tennis, and Candy Land. Every mailbag is the same and different, only on this week’s Rule Breaker Investing.

Welcome back to Rule Breaker Investing, a delight to have you with me for this Mailbag episode, September 2021. I want to mention in advance what we’ll be doing next week because I’m particularly soliciting your input, your wisdom. About once a year on this podcast, we’ve done a recurrent series called tips, tricks, and life hacks. It’s about that time of the year. Yeah. We lasted one October 14th of last year, we’re going to be cruising into October next week and I’d say it’s time for another tips, tricks, and life hacks now. I’ve got my own, I’ll be bringing you some of the best I have in mind right now, but I would love your best. Do you have a tip, a trick, or a life hack? That you can share with all your fellow Rule Breakers. I bet you do, think about it and email us The most helpful and interesting, the most compelling tips, tricks, and life hacks will be featured on next week’s Rule Breaker Investing. I’m very much looking forward to that, again, our email address, Now back to Mailbag and thinking about this month’s mailbag, this is the first out of our 50 plus mailbags where I really did not receive a single note that wasn’t worthy of this mailbag. In the past sometimes I’ll get, I don’t know, incomprehensible notes or sometimes notes that are far too long to share. But the 26 pages that I read of submissions for this month, for the first time, every single one of them, could’ve fit on this podcast. I think that says something great about how well we’re communicating. Because you already have a good sense if you’re a passive listener of what I’m looking for, for Mailbag, but occasionally threw out some tips like, don’t write me anything that goes on more than two pages or a few others you’re listening and it’s just tuning and tweaking the mailbag into a delight to read through. A real challenge to think through in terms of what I should feature from one month to the next. After all, every mailbag is different and every mailbag is the same. I was thinking briefly about this as I put together this week’s show because I thought about Scott McLeod, he wrote a wonderful book. Some of you no doubt have read it. It’s called Understanding Comics. Scott is a brilliant thinker and the book itself is a comic book. But it’s a deep dive into what makes for art and why in some senses, Comics tell stories so well, it’s a wonderful read. I probably read it 15 years ago or so, but one of the things I remember that McLeod does in his book, is he really democratizes the concept of what is art.

Turns out at least in his mind, and yes, I’m part of his school now. In my mind, there’s a lot more art all around us all the time that we would recognize. In a sense, it’s the creativity that we bring to the small moments in life. Not every artistic effort, therefore, is Michael Angelo worthy, but also not every artistic effort needs to be as earnest as somebody like Michael Angelo was no doubt at the start of one of his sculptures or paintings. I was thinking about this because just the decision about how to put together a mailbag or even that we have a mailbag, those are creative choices. As I put together this week’s show, I realized there were so many good incoming pet peeves that amused me so much that I should just create a rhythm for this particular mailbag of serious point. Those will be oddly numbered like 1, 3, 5, 7, 9, and then peeve to share 2, 4, 6, and 8, on the even points. That’s the rhythm, the uniqueness of this particular mailbag. But whether it’s a pet peeve, podcast, or the Market Cap Game Show, or how about just the stock stories series? Just the very notion that we would gather around a virtual campfire and tell stories on a stock-picking podcast or our great quotes or next week’s mental tips, tricks, and life hacks. All of those are creative choices and I’m not putting myself out as the brilliant artistic producer, but I am pointing out it is an active creativity. If you’re a podcaster even your choice of what word to use from one minute to the next is creative.

That’s my own orientation as I thought about this week’s podcast. It’s going to be, all of half the time about pet peeves. But I think back to some of my favorites recently, we had a theme that emerged from one of our mailbags earlier this year about working with elderly parents, loving our elderly parents. That just happens spontaneously with some of the submissions I got that month and connecting them. I’m going to be doing that a little bit later in the show with Mailbag item number 5, I’m going to be welcoming in Aaron Bush and John Rotonti because we got some questions about inflation and currencies and cryptocurrencies. I thought, let’s weave that together into a bigger conversation. Point number 5 is maybe the most exploratory and deadly serious in a very very silly month for Mailbag. There was also that one, was it a year or two ago, tinker tailor, soldier or spy, where I realized the whole mailbag should just be one story after another from many different people, from Motley different walks of life. I guess this particular week is in that same artistic tradition of something a little bit special arising spontaneously from what you have said in this month. Every mailbag is the same and we often have a few hot takes from Twitter, this one is no exception. I got three for you this week. Let’s go with Ryan Tretter, @Tretter86. Number of great tweets from you this past month, Ryan, but I like this one a lot. “Learning the true definition of an ‘investor’ has been a revelation for me along my journey. When I first experienced the stock market, all of the so-called experts I came across were basically pushing day trading or swing trades, no one was talking about buying good companies to hold.” Well, that is an excellent realization, Ryan. I do think that there’s a lot more talk about trading because in part, it’s exciting. It’s day-to-day. It’s a swing trade for the week so it tends to get people’s attention versus you and I passively saving every two weeks from our paychecks something to put, I hope, toward some of the better companies or at least funds, if you will, that we think will help shape the future. That’s not as exciting. I guess, as somebody’s trade or somebody’s NFL bet.

Hot take Number 2, the frequently recurring on this podcast @JiminyJillikers Jason Moore always fun to follow what you’re saying on Twitter. You went back and listened to an episode from a past mailbag, a February mailbag of your Alison Southwick goes on and she delivered this line which you requote, which I want to requote because I love it. She said, “You will never be the smartest person in the room or the best looking person in the room, but you can always be the kindest person in the room.” I love that sentiment, and I’m happy to say Alison Southwick herself @alisonsouthwick on Twitter. She responded back just this past month, fun fact, Allison wrote, “You can also choose to be the meanest person in the room, but it’s so much more exhausting.” Another very commonly shared sentiment this past month on Twitter, reacting of course to the Market Cap Game Show with Brian Feroldi and Brian Stoffel, I will just quote @307fool. Who said, “If you’ve never listened to the Rule Breaker Investing podcast, you’re missing out this week’s amazing combination of Brian Feroldi, Brian Stoffel, and of course David is, can’t miss listening. You will laugh, you will learn, and you will improve your day for sure.” It’s the Market Cap Game Show. A lot of you tweeting out I beat Brian. That was wonderfully ambiguous, but anybody who’s actually listened to the episode understands exactly what is meant by the phrase I beat Brian.

A lot of Brian sentiments on this month’s Market Cap Game Show. Before we get to Rule Breaker Mailbag item number 1, I just wanted to answer this quick question from Bruce Clark, writing in from Daytona Beach, Florida. He said, “Hello David, the voice of the woman behind both the opening and closing remarks on your Rule Breaker Investing podcasts. I’m curious if this is the voice of your wife, Margaret Gardner. “Well Bruce, you and I and Tom all met at the Westin right next to Fool headquarters back in the day, really back in the day you mentioned buying some of our paperbacks in the 1990s. I’m delighted that you’re now invested with Motley Fool Wealth Management and I’m happy to let you know that it’s certainly not my wife, that is Denise Coursey, a longtime employee of The Motley Fool, who lent her voice seven years ago when we started the podcast to the opening, of course, Rick Engdahl’s magic adding in the sound of rules being broken. As I think a lot of us will recognize or window if you will, kind of round things out for our modest intro. Few things I want to say about Denise. First of all, she is no longer at our company but was with us for a long time so we all miss Denise. Second, she was a martial artist at a high black belt level, can’t remember which of the martial arts, never had to find out myself directly in person. The last thing I want to say about her is to my knowledge she is not a professional voice actor although she did say she may have done some freelance gigs, well, she certainly did one for us. We’re grateful each week for Denise’s voice. Rule Breaker Mailbag item number 1, a quick reminder the odd number ones are serious, the even number one’s this week are a little bit silly. This is number 1. “Hi David, my name is Sem Verbeek, a professional tennis player from Amsterdam, Netherlands. It was my goal this year to learn about and start investing in the stock market. After having tried and not continued in the past few years, my dad sent me a link to to see what I could pull as learning resources. Needless to say, The Motley Fool immediately caught my attention. It’s continued to do so in the past few months, I now have been a member of Stock Advisor and Rule Breakers since May. I have started a portfolio of around 30 stocks and then subscribed to all podcasts by The Motley Fool.” Sem continues, “I’m 27 years old now. I would love to be playing tennis professionally for at least the next five years, during which I’m super excited to see how my portfolio will grow with me. In many ways, professional tennis is like the stock market.

If I focus on my results week-to-week or even month-to-month, my stress levels would go through the roof. If I don’t win the tournament, I lose every tournament at some point, sometimes you lose a match while you play the best tennis of the year so far, feeling like you had a great earnings report, but seeing the stock plunge because of short-term expectations. However, if I focus on my level and the underlying principles of improving, the results will follow. That doesn’t mean that work stops, it just means that you focus on the habits and principles that usually produce the best results. Like in business, those are the people around you, your mission and your purpose, your long-term philosophy, and from all other Fools out there, these are all applicable in many areas of life including sports. It would be an honor if you could speak about something I read in the book, Rich Dad, Poor Dad earlier this year. Just like diversifying your portfolio, it feels like diversifying my learning is also important. Now in that book, the author says this, ‘Frequently, my broker calls and recommends I move a sizable amount of money into the stock of a company that he feels is just about to make a move that will add value to the stock. I will move my money in for a week to a month while the stock moves up. Then I pull my initial dollar amount out and stop worrying about the fluctuations of the market because my initial money is back and ready to work on another asset.'”

That’s our correspondent Sem Verbeek quoting from Rich Dad, Poor Dad. Sem continuous, “personally, the idea of being in a stock only for the short-term doesn’t sit well with me. At the same time, your perspective and advice on it would be great. If there is a stock that has doubled for you and there’s another stock that you’d like to buy and feel strongly about for the long term, should one consider pulling the initial investment out of the doubler and buy the new stock with that money? Or should the process of compounding never be unnecessarily interrupted. Many thanks for all you’ve done and continue to do for everyone wanting to learn around the world. I’m currently in the process of listening to the Rule Breaker Investing podcast from the very first episode, and I look forward to continuing that process. A big fan from Amsterdam, Sem Verbeek.” Well, Sem, first of all, what a wonderful note. It’s always a delight to get a note from somebody who’s this young and this smart, this disciplined, and already taking such positive actions for your financial future and I mean future writ large. You’re already generating in the present earnings. I see that you are number 111 on the world tour, the ATP. You’re an awfully good tennis player with many good years ahead of you. You are now my favorite tennis player and anybody else who didn’t have a rooting interest in tennis, but wants to cheer on a fellow Fool here who’s asking some great questions about investing, I would say Sem Verbeek is our new favorite tennis player. Also, you’re a pretty handsome guy too, Sem, an easy guy to cheer for. Congratulations on your success up to now. I love that your dad got you thinking about investing. Not only that, but I love your analogies drawing from the world of sports and your life and how it matches to the market. It reminds me of people like Frank Reich, the NFL head coach of the Indianapolis Colts. Or I’ll mention The Motley Fool recently began sponsoring a golfer on the PGA Tour, Sebastian Munoz. Again, casual sports fans, if you’re looking for a golfer to cheer, well, from one Sunday to the next, watching the final day of whatever the last week’s great golf tournament was, Sebastian Munoz, but what it’s reminding me is that so much of what works in sports and the mentality that you just shared with us, Sem, does indeed work in investing, especially, I see you talking about not overrating very near-term developments, positive or negative. I easily see how that can make a lot of sense, especially in a sport where it’s just you in tennis. You might have a doubles partner, but a lot of these matches are one-on-one singles.

My favorite sport, baseball, has a little bit more of that dynamic. I think it’s in part why like it. But certainly, other sports that are much more a collective, like football or basketball or, of course, soccer or football around the world, all of those are much more team-oriented. But I think, especially as investors, it is our savings and our money that we’re putting. I think people tend to listen to this podcast alone or individually while maybe playing tennis, as opposed to in large groups. It’s a reminder that a lot of solitary activities come down to your mindset. I think your mindset in tennis beautifully maps to how you should think about your money. I’m seeing a triangle with all three sides whisper in my ear. My producer, Rick, just reminded me that’s an equilateral triangle, and one of the points is investing mindset and that’s what we’re talking about. It connects to another of the points of the triangle, which is an athlete’s mindset. There’s a real connection between those. You’ll notice beautifully evocative of that. The third one, I’m just going to call character because I think great character clearly leads to great sports achievement. Most of the people who have done remarkable things athletically, it’s because a lot of it is their character, their resilience, the way they compete against themselves, sometimes it’s their generosity or kindness within the context of the sport or others that they coach. A lot of these things are character traits that lead people to be great at sports, and I also believe the same thing. Your character and your mindset is what sets you up for your investing life. I think the reason that so many people like Frank Reich and Sem Verbeek, and I think Sebastian Munoz, that they do so well is because they are connected to great character as athletes, and then they recognize that they can make that all play out financially with their mindset.

So Sem, you are a great example. To give you a quick answer now to your question, I’ve never read Rich Dad, Poor Dad. I don’t have a lot of interest in the book. I do recognize it is a seminal work that many people have read, and it’s a very conservative work as it’s been described to me. It’s very focused on real estate, which can be a good investment, but the part that you pulled out, talking about getting a call from a broker in order to establish a short-term position in something someone thinks might go up, by the way, it might not, but even if it does, the idea that you would then trade out is so antithetical to Motley Fool investing. To our mindset, buy to hold investing, business-focused investing. That’s really obviously where we butter our bread, we’ve done very well with it. I think we’ve exemplified that to the world. There are other ways to approach the markets. I’m never going to say ours is the only one that works, but it certainly does work. I think it works for the most people. You don’t have to be a professional institutional trader or have access to real-time quotes to make a lot of money as a foolish investor. I would certainly encourage you in closing then not to follow the advice from your anecdote. Again, I don’t know the context of where it appears in the book or if that was truly the intent of that passage. But I’m not a fan of establishing a short-term position in the market and then selling out your original portion and just leaving whatever’s left there to see how it does. I’m much more interested in you and I making our portfolio reflect our best vision for our future. I’m a fan of buying positions and holding them for a minimum of three years, if not three decades. I think it matters a lot what you’re owning. You want to be able to tell your grandchildren one day, not only did you win Wimbledon, but you want to tell them that the brokerage statement that perhaps they’ll be inheriting part of one far-flung day from now was populated by companies that you were a part-owner of and that made the world better over the course of your life. Sem, best of luck out there on the circuit. We’re cheering for you. All right, Rule Breaker Mailbag Item number 2, which means I’m about to introduce a listener’s pet peeve. Now, I will say I have four of these items this week and they’re going to get, to me anyway, increasingly amusing and provocative.

That isn’t to say Jeff Brown from Blue Springs, Missouri, this isn’t a great pet peeve. I like it a lot. That’s why it’s on the podcast, but they could get even crazier as we go. “Hi, David. I always enjoy your pet peeves episodes. They are both humorous and can also cause me to look at things differently. I’ve even adopted a few of yours over the years,” and by the way, I really like yours here, Jeff, so the feeling is mutual. “But on this month’s pet peeves episode,” Jeff Brown writes, “you committed one of mine. You said, ‘Why does science fiction always need to be dystopian?’ My pet peeve,” writes Jeff, “is the use of the words always and never. So often these words are used and applied to things that aren’t always or never in the way that they happen. I know they are frequently used to try to emphasize that the event happens often or not very often, but this can also lead to miscommunication.” Jeff closes, “I emphasize this with my daughters as they were growing up, and now they are quick to point out if I slip up and one of those words is used in an improper instance. Thank you for your podcast as I always get some benefit from listening, whether it makes me smarter, happier, or richer. Jeff Brown, Blue Springs, Missouri.” I totally agree. In fact, I always agreed, Jeff. I would never not agree with you, and I’m obviously having fun. I am a big fan of moderating our language, and I do try to be attendant to that. I didn’t have a good dad like you who is tweaking me about that and so I can’t tweak my dad back about this, but I think that’s a great dynamic with your daughters. I certainly encourage everybody, of course, everybody listening to me, but all of my friends and family to improve any aspect of what I’m doing in life. I’m very open to being coached.

You’ve given me some excellent coaching there. I will try to use always and never only when they are appropriate. But you know I’m going to screw it up from time to time because, yes, we do like to emphasize certain things, and so we overclock our language to do so. So guilty as charged. Before we move onto Rule Breaker Mailbag item number 3, this does put me in mind though, all of that pet peeve once again, I’ll will tweak it now. Why does science fiction so frequently need to be dystopian? I’d meant to say this on the pet peeves episode, but I forgot at the time. I wanted to point out that actual disasters like when actually really bad things happen in the present or future, my experience is usually this brings out the best in people. That’s why I further part ways with this notion that so much of our science fiction should be dystopian because truly, in my experience anyway, actual disasters usually bring out the best in people. Rule Breaker Mailbag item number 3. Got a couple of these here packed into point number 3, reacting to I fought the law and the law won as we went and learn some new laws together earlier this month, and I got some great notes. This one from David Segrest. “Thank you, David, for your recent Rule Breaker podcast. The day after I listened in my daily Apple News Feed was the following.” Here’s the headline that David is pointing to. It says, can America’s fastest supercomputer defeat COVID for good? That’s the headline from Popular Mechanics. “We both know the answer to the question,” says David Segrest. If you remember Betteridge’s law, which is that generally when you’re reading media headlines that are phrased as a question, the answer almost always is the word no. You’re right, we both do know the answer to this question, David.

To say it one more time, this is from Popular Mechanics, by the way, can America’s fastest supercomputer defeat COVID for good? No, and on a related note, Betteridge’s Law, this was a Tweet that came in from Randy@fixedon66 this past month. He wrote, “While researching a bad drop today for one of my Rule Breaker winners, Veeva, I found this article to which I can already answer no, according to Betteridge’s law of headlines, and of course, Randy has selected a Motley Fool story who’s headline is this, “Could Veeva System’s stock help you retire a millionaire smiling?” says Randy. Well, I hope it could. Maybe occasionally, there are exceptions to Betteridge’s Law. Doesn’t every law need an exception? I don’t know, but I really appreciate Randy and David, how you picked up on and understood the true spirit of Betteridge’s law, and if that’s new material for anybody, the podcast that started this month, I Fought the Law and the Law Won. Speaking of laws, one other before we move onto mailbag item number 4, this one comes from my friend Matt Ellis. Now, Matt works as Vice President of Business Development at The Motley Fool, actually, who works for The Ascent, which is a Motley Fool service, and he Slacked me this and I said, “Please email that to me as a mailbag item because I’ll share it on the show. It’s perfect.” This one speaks to Parkinson’s Law. For those who may not remember, Parkinson’s law is generally the law that we will allow work to expand however much space and time we give it, it will expand to fill that space and time. “Hey, David,” writes Matt, “just finishing listening to your I Fought the Law podcast while in middle of moving into a house that we’ve been renovating for a year. I tell you this because your mention of Parkinson’s law made me laugh out loud as, of course, today is the deadline for the house to be done and there are 15 people here [laugh] trying to finish it up. Well, just last night, my wife and I had been talking about, should we have extended our rental to buy the contractor more time? The conclusion was, no. If we had, we would still be going through the same [laugh] thing. Glad to know it has a name Parkinson’s Law.” I hear you, Matt. Yeah, whether you’d given them six months, 12 months or 18 months, there would probably still be 15 people in the house that last day.

We need to be intentional about the time that we give work because it turns out, that’s exactly how much time we’ll probably spend on it. That’s much for I Fought the Law and the Law Won. Let’s move on to Rule Breaker Mailbag item number 4. This one comes from Arvind Sharma, “David, I’m a relatively new follower of you about 18 months and now a subscriber of many premium services of the Fool. Since I started listening to your podcast the past year or so, I’ve learned a lot listening from you. Also, thank you for the mailbags you do. It’s comforting to know one is not alone. Anyway, I will share my learning experience another day. Now, coming back to the pet peeves, how are we doing today?” Writes Arvind. Well, I feel the same when someone says, and I love this and I agree with you, Arvind, that’s why I’m sharing your pet peeve on this podcast, “When someone says, no problem in the hospitality and customer service industries. You bought something at the store, you’ve taken a paid service from someone, in the end you thank the person by saying thank you and you get a response, no problem. I really wish,” Arvind says, “that they would say you’re welcome or it’s my pleasure, instead.” I have to admit, I know I’ve done this. I bet you, dear listener, have done this too, but I think we can rise above that. I really do agree that one of the best things we can say when someone says thank you is, you’re welcome or you’re so welcome. That’s more of a Southernism that I hear a lot around North Carolina when I go visit, you’re so welcome. It’s a delightful thing rather than, no problem or the much more common these days, I would say, no worries, as if you were worrying in the first place or maybe the worst of all. This is in the same prompt, this isn’t a response to thank you. But when you ask somebody if they’d like something and the response is this, I’m good, and I often say, OK, yeah. Also, would you like this thing that I’m offering you? I’m good is not actually an answer to the question being asked. I think we can all be a little bit more aware, a little bit more precise with our language. It just sounds lovelier to me if somebody says, would you like this thing, you say no, thank you, not I’m good. If they try to thank you, you don’t say, no worries or no problem.

Thanks, Arvind Sharma. Well, if you’re keeping score at home, we’re now up to Rule Breaker Mailbag item number 5, which means we’re about to move back from the silly to the sublime. I’ve been rubbing my hands together this show because I’m so happy to have my two friends, Aaron Bush and John Rotonti on, to talk through Rule Breaker Mailbag item number 5. Now, John in particular, is making his Rule Breaker Investing podcast debut. Whatever the sound is that Rick Engdahl will create to celebrate the debut of a new guest, a longtime Motley Fool talent but a new guest to the show, Rick will play that sound now. Excellent. Aaron and John, I have you guys in because I want to talk through it. I’m calling it mailbag item number 5, but there’s actually several conversations here. If I put it under a single rubric, maybe I would say currency, cash, something along those lines, but several different emails we received at this past month spoke to one another. I want us to speak to it. I don’t know where we’re headed with this one, but before we get there, let me make sure we have quick introductions. Aaron Bush, you’ve been on the show before, but I’m not sure I’ve ever asked you by way of an introduction, a pet peeve of yours.

Aaron Bush: David, first of all, thanks for having me, but what I cannot stand is scales that start with one instead of zero. Like if someone asked me, rate this stock on a scale of 1-10, [laughs] I’m just like, no, it starts at 0-10, it’s like asking from 2-11 or like 10 percent to 100 percent. What if I want to get five percent, how do I [laughs] do that? It leads to all complex math and proportions you have to weigh that I just don’t want to do that.

David Gardner: I’ve always tried to go 0-10 but without real force or intention. But from now on, I am part of your tribe on this one, Aaron. I love it. I totally agree five percent can’t be expressed if we’re starting at one getting to 10. That’s so true. Your pet peeve has just become, I’m not going to say mine, all of ours. Thank you for that, Aaron, and before we welcome on John with his pet peeve, whatever it’s going to be, Aaron, I think a lot of us will know you as the returning constant champion of the Market Cap Game Show. We did that just a couple of weeks ago this month without you included because I didn’t want you to beat everybody again and we had fun with the two Brians, but you will certainly be back. We all know you’re an ace that way. I know you as a fellow Rule Breaker, could you just give a couple of sentences about what you’re doing in the Fool today?

Aaron Bush: Sure. I look over a handful of services. I am co-advisor of Rule Breakers: Blast Off, the portfolios that aim for maximum upside, as well as our platinum service, which oversees all the different Rule Breakers services fold up into that one. That is what my focus is on at The Motley Fool.

David Gardner: Sounds like you’re a pretty busy guy these days, Aaron. You always were but you sound even busier, and I know you got married, it was less than two months ago, so congratulations on all that you’re doing here in 2021.

Aaron Bush: Thank you David.

David Gardner: I’m very grateful. Thank you. John Rotonti, welcome to Rule Breaker Investing.

John Rotonti: Thanks for having me, David. I’m thrilled to be on with you and Aaron.

David Gardner: John, I’ve spent countless hours watching you on Motley Fool Live, love The Morning Show. Thank you for all your efforts. Not just The Morning Show, of course, but I think that’s an iconic place for you within Fooldom today, and it’s been a just a delight. John, when was your first day at the Fool, you joined our Analysts Development Program. I think these days you help run it but when was that?

John Rotonti: July of 2014, so I’ve been here almost seven and a half years, let’s say a little over seven years.

David Gardner: That’s amazing, and I know you began to work remotely still full-time before it was cool.

John Rotonti: Before it was cool, I was at Fool headquarters for two years and then went remote when we opened an office in Colorado.

David Gardner: There we go. But are you now in New Orleans, do I have that right?

John Rotonti: I did. During the pandemic, I moved to New Orleans where we have an office here as well.

David Gardner: Congratulations.

John Rotonti: We registered here in the state of Louisiana.

David Gardner: That’s right. The Motley Fool can do business not in all 50 states but in a bunch of them these days, enabling us to get some of the best talent available that wouldn’t always necessarily have been able to come to Alexandria, Virginia or Denver, Colorado. Well, John, I’m delighted that you are a part of that vanguard. You were an early mover and shaker to get us to be more remote focused. John, what is a pet peeve of yours?

John Rotonti: Mine’s not going to be as groundbreaking as Aaron’s. I do agree that Aaron’s is a universal pet peeve. [laughs] I guess a pet peeve of mine is mean people or jerks and people that try to turn to every issue into something that has to be so divisive. I think we build these hard lines around so many issues in our lives, and it’s not just like political. There’s people that are really diehard Keto or totally against Keto. [laughs] Then they don’t get along. Or really diehard CrossFit or totally against CrossFit and they don’t get along. It’s like, if you’re not on my tribe, then you don’t get it. I just wish we would soften our lines a bit and have some more common ground.

David Gardner: False dichotomies?

John Rotonti: Yeah. Exactly.

David Gardner: Well said, John, thank you. John, what are you doing at Fool these days?

John Rotonti: I’m a senior analyst. I’m also the Head of Investor Training and Development, and then I’m the host or co-host of two shows on Motley Fool Live, The Morning Show and My Investing Life, of which you’ve been on both.

David Gardner: Thank you, John. Yes indeed we’ve had a lot of fun there and we’re going to have fun this week on this podcast because gentlemen, I want to start with the first of three notes in for this mailbag item. The first one comes from Robert [inaudible 00:35:07] , he writes, “David, first of all, I really enjoy the Authors in August.” Thank you, Robert. “Hearing different perspectives and thinking about topics in a different way really is enjoyable and making me smarter and probably happier and richer too. I put a couple of books from last year on my Christmas list. I will likely do the same this year.” Well, that makes me feel really good, Robert. Thank you. Authors in August is something that I always look forward to, getting those different perspectives that you’re speaking to. Picking Robert’s note back up. “I don’t know how many complaints you’ve had for the hour plus length, but you want to hear one for me? You answered a question from me about a year and a half ago, I thank you for that. Between your answer and one I had answered on the Answers podcasts I’ve learned,” Robert says, “that I’m a very much a binary thinker. Questions must either be,” oh my gosh John Rotonti, is this your pet peeve? “Questions must either be,” says Robert [inaudible 00:35:59] , “either a yes or a no, but usually there is an area in between which I’ve been trying to find in everyday decisions. Therefore, my question today,” Robert writes, “I will leave very open-ended, a one-word question, inflation?” There’s a little bit more to Robert’s note than that, but I love how he framed the whole thing up. I’m just going to turn to Aaron first and I’m going to say Aaron, inflation?

Aaron Bush: [laughs] I’ll read into this a little bit and maybe twist it into where do we think things are going? How do we think about inflation to inform what we do about it, if anything. To which I would start by saying that in my opinion, I don’t think anyone really understands inflation, not only are our measurements, especially CPI, a bit old-school in my opinion, but inflation really is an output of a complex adaptive system with trillions of constantly evolving inputs, so not even the best supercomputers can compute exactly how things will play out, especially when crazy things like COVID last year can happen at any time. I won’t pretend to be able to predict it. That said, not all general observations are necessarily rocket science. There is supply and demand at play, if the supply of dollars outpaces the demand for dollars or whatever currency, then the purchasing power of the dollar, whichever currency erodes, and when the money printer is printing on high gear, it very likely could lead to some type of inflation or some greater level of inflation in time, and I would say the US Government has been printing [laughs] a lot of money lately. I would guess that we probably will see above-average inflation, although I would not want to get specific about any guesses.

The last thing I’ll say about this, I’m curious, hand the server to John is that it’s important to remember again, going into gray zone that inflation never really occurs equally across categories. On one hand, industries that are heavily regulated or perhaps like commodity-driven, they tend to face more ongoing inflation due to things like regulatory capture. On the other hand, innovation and technological progress can sometimes push prices down. We see that with TVs, for example, in the physical world, but more importantly, in the digital world of bits due to bare zero marginal cost of growth, and things like software prices can often fall with scale, which is deflation. As an investor, I hear and understand the popular take that it’s important to buy shares in companies that have pricing power and can easily raise prices to combat inflation, and that’s true and good in a lot of cases. But I’m honestly just as enamored by companies whose pricing power comes from lowering prices and innovating and growing volumes in huge ways, like with Amazon Web Services or what we see with lowering prices in genetic sequencing. These types of companies playing their own game, strike me as more immune to rising prices elsewhere in the economy. The best way to hedge inflation maybe isn’t a hedge, is just to find the things that go up a lot. [laughs] That would be my final opinion on that.

David Gardner: Well, thank you for taking us to that place, Aaron. You said about five really interesting things there. We might get a chance to touch back on them. But next, I want to turn to John Rotonti. John, I’m going to ask you the same question I asked Aaron. You’re ready?

John Rotonti: I’m ready.

David Gardner: Inflation?

John Rotonti: Yeah, I’m going to largely agree with Aaron. I’m not smart enough to have an opinion with any degree of conviction whether the higher inflation that we are seeing right now is sustainable or not. Inflation readings, even though they may be flawed, as Aaron pointed out, are higher-than-normal, the Federal Reserve has stated that it wants inflation to run hotter than it’s two percent target for a period of time in order to bring the long-term average backup to two percent. This isn’t terribly unexpected whether it’s long-term or not, I’m just not smart enough to know. I will say that stocks have historically been the best asset class to hedge against inflation, if hedging is the word that we want to use. There’s a Deutsche Bank long-term asset return study, and it looks at returns going back 200 years actually, it looks at socks, various corporate bonds, it looks at treasury bonds, it looks at home prices, and it looks at gold, and pretty much over any period, going back 200 years, 150 years, 100 years, 75, 50, all the way up until recent time, pretty much stocks provide the best out performance relative to those other asset classes. Over long periods of time, stocks provide seven percent real returns. That means real meaning up above inflation. The stock market has returned about 9-10 percent before inflation, and then about seven percent after inflation, so stocks are a great hedge. But as Aaron said, there’s no doubt that technology and innovation is also contributing to deflation. There’s no doubt that Amazon Web Services and Shopify is making it cheaper to start a business. No doubt that Airbnb and other online web vertical market search engines for travel are making it cheaper to take vacations. No doubt Netflix is making it cheaper to consume video rather than going out to a movie. Or Google‘s making it cheaper to consume information rather than have a library card and drive into library. There’s no doubt that technology is deflationary in a way as Aaron said. Where we end up, I don’t know, but I like stocks for the long term.

David Gardner: Well, I think we all do. Ultimately, a lot of this is shorter-term in that well, I’m 55, so I think I’ve lived through, I’m going to make this up eight different economic cycles. If you’re investing for a lifetime then even if one of those cycles last seven years, it’s a tiny part of your investing life, John Rotonti. For me, I’ve never spent a lot of time worrying about too much. I will say having grown up in the ’70s and ’80s, double-digit inflation that made a real impression on a generation, I think. Yet as you point out, stocks were a good thing to be in through the ’70s, especially the ’80s and the ’90s, by the way, also the […] and the teens, and now here we are in the ’20s and I think we’ve been rewarded for just looking longer than the inflation hawks. It is though very distinctive to this era that those deflationary pressures. I think a lot of people who’ve spent a lot more time looking at macroeconomics than I have, were expecting big inflation in 2012, ’15, ’18, ’21 that hasn’t shown up largely, I think because guys, those deflationary pressures, those are really big pressures. You talked John about Shopify and Amazon starting a business or the entertainment industry, I remember Chris Anderson, the former editor of Wired Magazine, wrote a book called Free, The Future of a Radical Price. That was it. It’s really one of those to me, Zeitgeist feelings for me, spirit of the age, was that stuff got a lot cheaper in so many ways that we really should appreciate as consumers and you have to respect and understand as observers.

John Rotonti: For sure. The Internet and the smartphones has brought about price transparency.

David Gardner: Yeah.

John Rotonti: If you’re buying an appliance at Home Depot or Lowe’s, you can instantly compare that price of the appliance anywhere else online or another store, brick-and-mortar store.

David Gardner: Great point. Let me move on to a second letter coming in to keep the currency talk going here. We’re going to go a little bit of a different direction. Aaron Bush, I’m looking particularly at you, I bet John is too. You spend a lot of time looking at this. This is one of those Bitcoin questions. Let’s say introduce this question from Nikhil [inaudible 00:44:25] . from California. Nikhil, “Hi David and RBI team. A question. Given the projections of Bitcoin to appreciate,” I’m not sure what projections exactly, gentlemen, he’s referencing, but let’s just assume they’re projections that they might be his own or those of the world at large, it has appreciated pretty well over the last 10 years or so. “Given the projections of Bitcoin to appreciate and The Motley Fool’s own investment of five million dollars US? That’s correct. My brother Tom announced that we were buying five million dollars of Bitcoin. This was months and months ago, but anyway, he says, “Do you view Bitcoin as a threat to The Motley Fool as a company?” People just continue investing into Bitcoin, which is projected to outperform equity investors.” Again I’m not sure where that projection comes from. “Then it becomes simple and easy, but it takes away from what The Motley Fool can offer.” There’s a little bit more to it than that. This ultimately isn’t a question about The Motley Fool. I feel secure in what we’re doing. We’re trying to make the world smarter, happier, and richer. That includes advice around Bitcoin and Aaron Bush has brought as much of that as anybody at our company. But Aaron, you once broke down the six traits of a Rule Breaker as you’ve thought through Bitcoin and you said, “Yes, Bitcoin itself is a Rule Breaker.” Aaron Bitcoin itself a Rule Breaker. I just wanted to start by asking you, do you still feel the same way? What are your thoughts right now, here at the end of September 2021 about BTC?

John Rotonti: I think Bitcoin definitely was and still is a Rule Breaker, but I also would extend the conversation to say that also Ethereum, the second largest cryptocurrency, is also a Rule Breaker, and also potentially crypto as an asset class is potentially a rule-breaking asset class. You can go on in and pick different things and some projects will be great and interesting and others we’ll find out, but there’s a lot of interesting technology shifts, business model shifts, etc., going on in the world of crypto. You asked, is it a threat to The Motley Fool? I’m with you. I don’t think it is at least anytime soon. If anything, I view it more as an opportunity, it’s not every day that you see an emerging asset class, that is real take off and get some traction and actually have a lot of smart people and a lot of money flowing around in it. If you have enough smart people, enough capital, enough momentum usually there’s something there that’s going to turn into something big. I think crypto is probably going to be something big. Yes, I mean, I think we at The Motley Fool can continue to step up our game to continue providing more context advice. Just helping people become smarter, happier, and richer around the context of crypto and how it plays, and both in how it’s just changing the business landscape in certain ways or how it might continue to grow it’s influence in the future, but also how it might play a role in investment portfolios.

David Gardner: Thank you. Certainly we have talked some about that in past and we’ll no doubt in the future. But here we are in the present talking some more about it right here. John, one of the things in Nikhil’s note that I noted and probably you did too, is projections in the concept of people projecting Bitcoin to go up over time. In fact, a little bit later in his note, he says, “Investors can just dollar-cost average into Bitcoin overtime with potentially greater results and potentially a shorter time horizon. Though it may be speculative that of course, common stocks. John, your thoughts on his projections or what your own projections might be around this definitively rule breaking asset class.

John Rotonti: Thanks, David. I don’t know where, as you said, I’m not sure what projections he’s referring to, but the idea of just dollar-cost averaging into one asset, meaning Bitcoin, that would go against I think one of our core investing principles here at The Motley Fool which is to diversify. Like we try to get our members to get up to 25 stocks as quickly as they comfortably can. Just neglecting stocks and dollar-cost averaging only into Bitcoin. I think maybe that’s not diversified enough. More generally speaking, I’m conflicted on Bitcoin because on the one hand, the thing we love about stocks is that they have asymmetric upside. Meaning you can only lose 100 percent if the stock goes to zero. But the upside is hypothetically unlimited. As I think about Bitcoin, I also see the potential for massive asymmetric upside because one, the global money supply is just massive. It may be the single largest market in the world. I’m not entirely sure, but their global money supply is massive. If we’re talking about TAM or total addressable market, it’s got that.

Then the other thing is there’s only 21 million Bitcoins that are going to be in existence, and so 21 million out of eight billion people on the planet, that suggests massive scarcity value. I do see the potential for the price of Bitcoin to go much, much higher over a long period of time. On the other hand, a lot of growth investors that are enamored by Bitcoin, those same growth investors have benefited from, myself included, a very accommodative monetary policy over the last decade, and so what I mean by that is low interest rates, as well as printing money to buy bonds, to buy $120 billion worth of bonds every single month. Whether we agree with this monetary policy or not, or whether it could lead to inflation or not, it’s not what I’m trying to say, I’m just trying to say if that monetary policy has been very good to the stock market, the tools at the Federal Reserve have had been very favorable to the stock market. If Bitcoin comes in and completely disrupts the value of the dollar in some way like this monetary policy become less effective, I’m just thinking out loud here. Do we want monetary policy to be less effective? Because it was monetary policy that helped us recover from the recession brought on by the economic lockdown and the pandemic, and it was monetary policy, which is at least partly, I think, driven the stock market over the last decade. I’m not sure that the same growth investors, high-growth investors that love Bitcoin want to disrupt monetary policy. I’m not even sure Bitcoin will disrupt monetary policy, but these are confusing thoughts that are bouncing around in my head right now regarding Bitcoin.

Aaron Bush: Yeah, I think that’s all really interesting, John. The one thing that I would say back to you is that probably at the Fool, I’ve been more bullish about Bitcoin than others, but I actually don’t really view it as much of a currency. I don’t think Bitcoin will replace the dollar or any other currency. It’s not technologically built for that and it makes for a pretty horrible currency. You can probably do it more as like a digital gold or something a bit closer to that. That said, I think a lot of the monetary policy points that you were making were really interesting. Because if you zoom out beyond Bitcoin and just look at crypto as a whole, there are basically what cryptocurrencies represents, they turn different networks in some markets of types and the tokens represent value in whatever market that is, it become the currency of that market, but they also represent ownership and governance too. But what we’re really seeing is, in all of these different markets, in all of these different projects that are springing up, they’re all doing their own monetary policy experiments, so I actually probably view it less as at least in the near-term or anytime soon, that something like Bitcoin or cryptocurrency will dramatically change the monetary policy that the Federal Reserve or other big governments around the world put into place. But we’re going to be potentially learning more about monetary policy and the effects of what things can mean for inflation, or how incentives work in markets like this than before, and I really do believe that crypto as an asset class and a lot of ways cryptocurrency is a misnomer because I think a lot of people cling to the currency idea of that there’s some truth to that, but it really is more than that. It’s about ownership of emerging projects being collectively owned by a community who is putting work into building something. It represents governance like actually helping build and drive these different things more so than a currency themselves. In some ways, it’s not necessarily disruptive to all companies, but it’s another way of organizing people to build things and chase after big ideas.

David Gardner: That’s a really compelling reframing, Aaron. I appreciate that, because you’re right. There’s too much focus on cryptocurrency, and pointing out that a lot of this is just about people collectively working together to build something of value is a brilliant way of rethinking things. I did make this guy’s the currency mailbag item, so I’m going to go back to currency one last time. I wish we could continue this conversation, in fact we probably should, perhaps in an upcoming podcast, especially, if I hear a great human cry after this month’s mailbag from people who’d like to have more discussion on this podcast around crypto, and/or inflation or currency, what we’re touching on, we just never have time for it all. Let’s do that. But let me move it onto this final note that I wanted to share. This is from PT Lathrop, and PT is written in a number of times, really interesting fun stuff to this podcast. He shared a couple of pet peeves that I didn’t have time to share this week. This one’s a little bit loopier, a little bit crazy in a good way. I’m just going to put it out there and ask you each to make a brief comment about it and then we’ll move on with the show. But here it is in short form. “Hey David, I’m not smart, but I’m smarter than I would be otherwise because of you guys. I had an epiphany, you might like, on the drive home today.” PT says, “Cash is equity. I was listening to people discuss monetary policy around the world and I’m sure economists out there have considered or understood this, but it felt like a capital F Foolish connection. When countries,” PT writes, “print money, their ability to do so with minimal inflation is similar to a company’s ability to issue more stock or equity with minimal drop in share price despite the dilution, if you’re the US with a 20-ish trillion-dollar economy and you encounter a big problem, you might be able to print a fresh $500 billion with much less inflation than let’s say, a $10-billion economy that encounters a one-billion-dollar problem,” this sounds like straight math to me guys. “Anyway, it seems obvious now, but I think it might help others understand this concept. I know Fools aren’t Forex Traders,” I’m going to agree on that for the most part, but that of course, would be the foreign exchange. “But these dynamics help us better know long-term effects of monetary policy.” John, what jumped out to you about PT’s thought and if you want to throw it in the context of what we just talked about earlier, inflation and Bitcoin even better.

John Rotonti: Yeah, I think that the companies issuing a lot of stock to pay their employees and the stocks not reacting so much, that may be a temporary phenomenon, I’m not sure. At some point, maybe the market changes its mind on stock-based compensation, that is, in some cases, maybe [inaudible 00:56:20] , just I’m not saying it is, but it may be it is, and maybe investors change their mind, they look less favorably on the dilution. It’s a great question, I’d probably have to give more thought to, I’m not sure I see the immediate link between the two.

David Gardner: Maybe what I’m seeing here John, it’s a contrast. Companies really can only issue more stock that dilutes the existing ownership of all of us who are their shareholders. There really are transparently held accountable, it’s a more of a finite resource, the ownership of a public company. However, a country’s currency, there isn’t real finitude around that, is it? We all still have questions about how much can you print before you create potentially real problems or really devalued currency. I think we’ve seen some so-called Banana Republics that have done that over the decades of generation showing it doesn’t end well a lot of the time. I think PT’s point Aaron a little bit to the scale of things and pay attention to the scale, $500 billion of quantitative easing sounds like a lot, unless you are the US where it might not be so much, it’d be a heck of a lot for Luxembourg.

Aaron Bush: I think cash and equity are both financial tools that have a place. I don’t think currency is equity, but maybe equity can be used as a currency. Both are tools, I think you’re right that both can be diluted into being worth less in the process of creating new shares or bills in order to compensate for something. The difference really though, is that equity represents ownership, especially, ownership of what’s possible in the future. Which usually comes with some type of governance power. You get to vote as a shareholder, and yeah, it can be used as a currency in some ways, you raised money with it, you can reward employees with it, but equity is far more about ownership than it is about spending, whereas cash is much more designed to be spent. It’s designed to be the lubricant of an economy, not ownership of an economy. That’s how I would make the distinction, between currency and equity. Then crypto to tie it together, is like a third hybrid of sorts where currency, ownership, and governance over the economy of a project that wrapped all into one token. As I was saying before, we’re seeing tons of different experiments play out there. The way I view it is that, we have different financial tools, but with the digitalization of the world, we’re seeing the rise of programmable money, where we can design it to be more flexible and have different use cases than in the past, and doing so, be able to create new use cases and do some new things there, but we’re still in the first inning and it’ll be fascinating to see where that ends up.

David Gardner: Another interesting, compelling thought of reflection, thank you, Aaron. I had you guys on because you are two of my favorite Fools. You both have deep intellectual curiosity, and a love of this subject and a love of our future. We would not be in this if we didn’t think we’re trying to build a better world with all the decisions we’re making right now. John as the newbie to this show, this week. I’m going to give you the final word, anything you’d like to say.

John Rotonti: Thank you, David. I’m thrilled to be on the show with you and Aaron. I have to say my claim to fame is for about a year, I believe David. I was the only other person on the planet, tell me if this is right, that had access to your five-stock sampler spreadsheet?

David Gardner: [laughs] It’s true. [inaudible 01:00:00] , but I shared it with you because we talked about it on Motley Fool Live. You had the honor to discuss at one of those. Thank you.

John Rotonti: That’s exactly right. For about a year [laughs] I was the only one that had access, and now I’ve got to come on your Rule Breaker podcast. I feel great coming on the show. Thank you.

David Gardner: Well thank you. Thank you guys, John Rotonti, Aaron Bush, Fool on. As I wave goodbye to my friends Aaron and John, what great reasons to be subscribed to The Motley Fool, to get stock picks from Aaron Bush and team through Rule Breakers. Not just Aaron, so many wonderful Fools, or to get the insights and the deep thinking from someone like John Rotonti, on practically a daily basis on Motley Fool Live. If you’re not already a Motley Fool member, this is a free plug. It’s my company, so I guess I can plug it on my podcast, but shouldn’t you get started investing, for real? Join Thank you Aaron and John for being such wonderful ambassadors of Foolishness. Rule Breaker Mailbag item, even number 6 takes us back to a few pet peeves this time, and we bring back Nikhil [inaudible 01:01:05] . Nikhil [inaudible 01:01:06] , thank you for writing in. You had your Bitcoin question we just spoke to. Here you list a couple of peeves. “Greetings,” says Nikhil, “huge fan of the weekly Rule Breaker podcast, a relatively new Fool here. Joined the services in 2018.” Nikhil has two pet peeves. Number 1, the overuse of GIFs in private or individual group text messages. Nikhil says, “I find I will text someone a message or a question, and then they habitually respond with a meme or more often a GIF. Once in a while I’d appreciate it if they just would write out a reply. Sometimes the GIFs are totally unrelated. I sent a question of, how was the housewarming party, and the reply was a GIF of a dancing creature I couldn’t even identify. I’m like to myself, ‘What?’ [laughs] Not to mention it takes up a massive amount of storage on my phone,” Nikhil further complains, “which later takes more time to go back and delete. My request to all GIFers, actually type out of text response sometimes,” and he’s laughing out loud as he sends that. I do want to make it really clear that the word is pronounced GIFs, which is why I have pronounced it GIFs on this podcast. After all, if it were GIFs, that would take away from using J to really make that unique sound GIF.

I know I’m contributing to a much larger dialogue that spans the Internet, but my friends, it is GIFs, hard G. If you ever want to make the sound GIFs, just use a J. On a roll, Nikhil gives his second. He says, “I am guilty of this one,” I probably am too, “when people or healthcare professionals,” Nikhil says, “say, ‘Can I ask you a question?’ Then proceed to ask the question before the patient or person can respond and say yes or no, it’s presumptuous,” says Nikhil, “annoying, poor communication, it can be rude, and I do it all the time and I’m trying to catch myself and cut it out,” says Nikhil Jain. “I hope these are broadly applicable. Hope you got a kick out of them. Love you guys, Fool on. Best regards, Nikhil Jain.” Here’s how obnoxious I am, Nikhil. If you’re a friend of mine and you say, “Can I ask you a question?” I always immediately say, “You just did.” Then they’ll say something like, “Can I ask you another question?” I’m like, “You just did.” [laughs] The only proper response at that point in the conversation is for my friend, and I’ll do this to say, “Could I ask you two more questions?” Then the answer is, “Yeah, go right ahead.” Rule Breaker Mailbag, item number 7. “Hi, David. I’m a longtime listener of the Rule Breaker Investing podcast, I’m a recent member. My 12-year-old son started listening to the podcasts whenever we’re in the car. He especially enjoys games-related podcasts, both board games and the Market Cap Game Show. You’ve also inspired us to get into more advanced games such as Wingspan, and Terraforming Mars,” good on you, Vikas, “My son, also downloaded BG Stats app on his iPad.”

The BG Stats app, I’m a huge fan of that app. If you’re a board gamer and you want to keep a record of who scored what on that game, what date it was played, maybe even where it was played, you can log through this very user-friendly app as much of your gaming life as you want. The Gardner family has logged thousands of plays over the year. So we know each person’s universal win percentage, we know their highest score ever in Terraforming Mars, etc. Big fan of that BG Stats app. Vikas Patel continues here. “Yesterday he played an old Rule Breaker Investing episode of Games, Games, Games and I heard you making fun of Candy Land. I also have an eight-year-old son with autism,” writes Vikas. “For him, the Candy Land game is such a valuable game that’s so simple to play. It teaches him social and turn-taking skills. For him this game is no less than a rating of at least 8 out of 10, I think. I’m not complaining with your take on Candy Land, but just thought of sharing it with you, keep up the good work.” Thank you Vikas Patel. Well first of all Vikas, I completely understand how meaningful Candy Land could be for your son. I certainly agree it does some wonderful things. For younger kids than 8, for a lot of kids, they learn colors from the game, Candy Land. It tells you to move forward two blue spaces. So you need to know blue and you need to be able to count two. From earliest days, a lot of kids can enjoy Candy Land. Now you’ve spoken to some more nuances there. You’re talking about social skills that you get from playing a game, or turn-taking skills, and those are also important and I absolutely can appreciate that Candy Land is a valuable game for him and for your family. For that, I like Candy Land and I like that you took the time to say it. Now I will say for the rest of us, and why I do invade against Candy Land on a regular basis, it is this: Candy Land lacks one important component of a good game for me, and that is, there is no decision-making. You don’t make any choice at all. All you do is pick a card, it tells you yellow, you move your pawn forward to the next yellow space. You might get in trouble or have to fall back, or you might get a shortcut by moving to that color space.

But the reason I don’t like Candy Land, and yes, I’ve intentionally sounded like an angry old man telling you to get off my lawn as I make this point, is that it teaches kids that decisions don’t matter, just follow the rules. Now let me be clear. There are some people for whom following the rules is a challenge or a great lesson in learning. For that, Candy Land, which is certainly an iconic American board game, it’s maybe an internationally iconic board game, I don’t know, it’s got to be beloved by the candy industry because it gets kids [laughs] thinking about where the next candy bar is coming from. But to me in the end, the measure of a good game, or a great game, or the number of interesting decisions. You obviously also mentioned Wingspan, which is a wonderful medium-weight board game, or a heavier-weight game like Terraforming Mars, which takes hours to play and a lifetime to master. Those are the games that I really love for the interesting decisions that they have us make. I think a great way to judge games, at least for a strategy gamer, is think of the number of interesting decisions that you made over the course of the playtime. Then that’s the numerator, and then divide by the playtime. Interesting decisions per minute or per hour, that’s really how I think about rating games. Of course, fun counts for a lot too. You were talking to some of the social and etiquette aspects of games as well, and I also think that’s part of it. You know what I’m thinking about at the end here, is that there is a favorite game for everyone on Earth, and I don’t expect anybody to have my games as their favorite, they’re my favorites. You can have your favorites too and our kids as well. Thank you for sharing and I’m so glad we do some games podcast here and again so we could have a conversation like this on a mailbag.

Rule Breaker Mailbag item number 8, and yeah, this is going to be the last and therefore my favorite of the submitted pet peeves from our community. It’s from Skippy Kits Miller. Skippy, you and I see things I guess the same way. I even love that you started your note this way, “Fool,” Then you wrote, “Two pet peeves for you.” Then below that are three pet peeves. [laughs] I’m going to share all three of them, but each one starts with a one-liner and then the paragraph explaining, and they’re well done, and it is my pleasure, Skippy, to share this with the world. Here we go, “Two pet peeves for you. Number 1, apologies without action when required.” Skippy writes, “You spill my beer, don’t tell me sorry, just get me a new beer. An apology is for an oversight or an accident, not to avoid a responsibility. For example, don’t say, “Sorry, I didn’t put gas in your car when I returned it.” That is premeditated often, put gas in the car. I don’t want to hear, I’m sorry, I want one to put some effort and to avoid having to say I’m sorry in the first place. Apologies have value, but many require penance.” That’s number 1 of 2. Here comes the second pet peeve from Skippy. “Replying to a large group of people when your message only applies to a few.” Now I think we’ve all seen this in the workplace. Skippy has too. “I see this at the workplace most often,” he writes, “when a person is tracking completion of training instead of updating the list to those who haven’t completed the training, they spam everyone. If you haven’t completed your training, remember to complete your training. [laughs] If the training is important enough,” Skippy writes “for you, just send an email, take the time to refine the list, not spam the persons who’ve already complied.” Now that’s also similar to hitting “Reply All”, when you’re just there to say, “Yeah, I’ll be there at 8:00 PM,” but you hit “Reply All”, so 738 other people hear that you will be there at 8:00 PM. I think we’re all aware of this. Some people call this netiquette and they say that goes against netiquette. Netiquette, the etiquette of the Internet, email, if you will. I think we can all appreciate and probably share that feeling that replying to a large group of people is unnecessary. You’re actually twisting it a little bit though because you’re saying, “I like this too,” that if somebody is managing a database and lets everybody know that they have to sign up for something, and then you and I have both signed up for that thing, to me, netiquette suggests they should have removed you and me from subsequent mailings. They shouldn’t give us the six reminders to everybody to sign up for this thing before the deadline when we’ve already done it five reminders ago. I agree with that. Now here comes number 3 pet peeve of your two submitted. It says, “Businesses not accounting for the value of other people’s time.” Now I think this is a really compelling point. A little bit nuanced, but I think we can all appreciate this. Skippy writes, “Amazon does it right. I need to return something, it takes five minutes with tons of options. Most other businesses do not.

A billing error on a credit card that takes 2-3 hours to resolve on the phone may correct the erroneous charge, but there’s no compensation for those 2-3 hours that you spend. Some stores state, “Hey, just return it back to the store, we’ll take care of it.” But are they going to pay for your gas?” Skippy writes, “What about your time? A lot of situations can only be rectified during business hours, so now I need to take off work to correct your mistakes.” Skippy, I think this is a really good point. Businesses that truly respect our time will continue outperforming those that do not. I think you’re right to factor in the amount of time that it takes for us to correct mistakes made by others. The best people and the best businesses will account for that time or try to reduce it as closely as possible to nothing. Thank you, Skippy Kits Miller. Thank you, many Fools, for all of your peeves submitted. We’re not going to keep airing our peeves next month. This happens about once a year, but it’s sure can power half a mailbag when it happens. Well, before we hit our final mailbag item, a quick reminder. Next week, tips, tricks, and life hacks. I’d love to hear your best. Again, our email address, I mentioned, in particular, we’re taping this episode early. I’m going to be at the Conscious Capitalism Summit in Austin, Texas, next week. We’re taping this one over the weekend. To have your tip, trick, or life hack featured next week, you need to email us probably by this Friday, a day or two after you’ve heard this podcast because we’re recording next week’s podcast on Sunday evening. There’s the deadline,, for your best tip, trick, or life hack. That takes us to the final mailbag item of this month, and it’s number 9. This comes from Brad in Inver Grove Heights, Minnesota. Brad, thank you for your lovely note. “David and team Rule Breaker Investing. First off, let me say how much I’ve enjoyed the various Motley Fool podcasts and articles, especially the RBI podcast. I’ve been a Stock Advisor and Rule Breakers subscriber for just over one year and have truly been blessed by all I’ve learned to date. I can’t express just how floored I was to be driving home one day in June, listening to the June Mailbag, which you entitled Scuttlebutt, to find out my mailbag entry was the reason for that month’s mailbag title. I ran inside when I got home. I played it for my wife, who has yet to adopt my love of The Motley Fool and investing the Foolish way. She was excited for me, but it didn’t get her hooked the way I’m hoping she will one day become.

A little background. When I was a young lad in 5th grade, I began mowing lawns for a couple of older people in our neighborhood. Each summer, I would add a couple more customers to the point where I was making pretty good money, especially for a 7th-grader. At the end of the summer, I had some extra money in the bank, and my dad asked if I would want to talk with his friend, who is a stockbroker, about investing that money. Well, I loved the idea. I met with him in his plush office at the top of a skyscraper in downtown Minneapolis and discussed this idea and he recommended two companies to me. One was a regional bank whose name I cannot recall, and the other was Dairy Queen, a local company. Who doesn’t love a good blizzard? I gave him $500 of my HARD-EARNED dollars,” writes Brad. “I was checking my stocks in the local paper as often as I could, so excited to see what might be happening, and then a fateful day arrived. Black Monday, October 19th, 1987. It cut my $500 investment in half. I was devastated. My broker, I thought I was so cool that I had a broker as a 7th-grader, tried to encourage me to ride it out, but I wouldn’t listen. I pulled the money out even though it had lost over 50 percent. Well, fast-forward 10 plus years, and a friend gives me a copy of The Motley Fool’s Investment Guide, which I read and enjoyed but being fresh out of college and not making much money didn’t feel like I could put any of it into practice. Through the years since, I’ve had various 401(k)s at jobs that have been rolled over into an IRA, which has since been converted into a Roth IRA. These have all been invested in various mutual funds, and they’ve done fine.

But I’ve had little interest in learning about these funds, and I’ve trusted my financial advisors over the years to invest the money wisely. I have been married 15 years, and my wife has an IRA as well as a Roth IRA, which are also invested in various mutual funds. While a little over a year ago, I woke in the middle of the night as I am wont to do,” writes Brad, “and began thinking about my family’s financial future. I especially began dreaming of getting us to a place where we felt financially free, so we could make decisions about our time apart from decisions about our finances. This is when I stumbled upon a Motley Fool ad on YouTube and began reading some of the free content. I quickly decided to subscribe to Stock Advisor and Rule Breakers and listen to the podcasts. The knowledge I’ve gained in the past year has truly been life-changing. Well, I convinced my wife to let me invest half our monthly contribution to both our Roth IRAs in stocks, stocks that I’m picking as a way to test the waters of investing in individual stocks instead of just mutual funds. Well, I’m now up to 45 stocks, which include the classics, Amazon, Apple, Mercado Libre, etc., as well as some of the newer selections, Asana, Airbnb, Upstart, etc. I’ve told my wife my dream of shifting all our investments to my individual stock selections, and she has asked me to show her my results. Well, I’ve tried to explain that a small snapshot of performance isn’t the best indicator of whether we should shift things or not. My wife is very wise and very financially frugal, which has blessed my life beyond measure.” Brad hastens to insert. “This extremely long-winded email today is to ask for any advice that you can give on getting my wife on board for transferring our Roth IRA accounts from the mutual funds our financial advisor has them in, to some of my individual stock selections that I’ve been making for the past year.

Any input is much appreciated. Again, thank you for all you’ve done for me, my family, and all of us Fools. Fool on. Brad in Inver Grove Heights, Minnesota.” Well, we’re right near the end of a long mailbag, Brad. I’m sure we could talk this over in greater detail one day as a member. Perhaps you’ll have an opportunity to come visit us once we actually have face-to-face conferences again. We could high-five and then talk this out over a beverage of your choice. But for now, I’ll just say two things. First of all, I think that you’re doing everything right. That includes listening to your wife and making sure that you’re respecting her own temperament and how she thinks things should be invested. That’s a good idea. Another great idea is that you started with a portion of your money, really a minority of all that you have in this world. When you think about it, you’ve started to invest it directly in stocks. That’s another great step, and that’s going to generate results. Now, your results are obviously short-term in nature. They might look great. It’s been a strong year over the last 12 months. Or they might not look so good. The market has been up and down with some more down than up at various points over these last six months. But whether you look really good right now or not so good, you’re right. One year doesn’t prove a lot either direction. That’s why you keep on keeping on. I would say, with each passing year, your results will tell you and your wife both looking unblinkingly at facts, at data, you’ll be able to see whether you are beating those mutual funds that you’re invested in. By the way, make sure you account for the distributions of those funds and the taxes that sometimes you have to pay at the end of each year, as well as the funds’ fees. It’s a lot less expensive to buy and hold great companies. Make sure you are looking at all the math here. But I don’t think there’s any substitute for going out there on the playing field and proving it.

Now one Fool to another, I have a lot of confidence in you. I can hear your intelligence in your note. I can hear your good heart, and I love that you have a base of 45 stocks. A great base to build from. You’ve got some great companies, and I trust you will be beating the market with those companies over 3, 5, 10 years. But sometimes you have to let time happen a little bit in order to change minds. I want to give credit to your wife right upfront because she already, it sounds like, has given over to you her trust with half of her and your Roth IRA. I think that’s a great start. I said I had two quick thoughts for you. That’s the first and primary one. I think you’re on the right path, and you’re doing everything right. Keep going. My second and final thought. In a lot of married couples, one of us typically cooks, the other typically washes the dishes. What if you started to do both sometimes? I’m not going to say more often than not, but surprisingly, you start to do both here and there. Then mention when a particular company that you own had a particularly good day. I feel as if a lot of life comes down to us being social creatures. Each of us has a power of persuasion to exert on the world, and it isn’t just the big things like, “Hey, honey, I just took half of our money and started investing it directly. Let’s see how I do.” Sometimes it’s the small things, like the meal and the dishes.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Aaron Bush owns shares of Airbnb, Inc., Alphabet (C shares), Amazon, Bitcoin, Ethereum, MercadoLibre, Shopify, Upstart Holdings, Inc., and Veeva Systems. David Gardner owns shares of Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Lowes, MercadoLibre, and Netflix. John Rotonti owns shares of Alphabet (C shares), Apple, Home Depot, Shopify, and Twitter. The Motley Fool owns shares of and recommends Airbnb, Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Asana, Inc., Bitcoin, Ethereum, Home Depot, MercadoLibre, Netflix, Shopify, Twitter, Upstart Holdings, Inc., and Veeva Systems. The Motley Fool recommends Lowes and recommends the following options: long January 2022 $1,920 calls on Amazon, long January 2023 $1,140 calls on Shopify, long March 2023 $120 calls on Apple, short January 2022 $1,940 calls on Amazon, short January 2023 $1,160 calls on Shopify, and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.

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