Greed

I met a new neighbor for the first time on 4^th of July. Terrific guy. Someone told him that I was a bit of a watch aficionado, so he rolls up to me wearing a Richard Mille.

Drool. I want a Richard Mille. I mean, I could afford one, one of the cheaper ones, but it would be irresponsible. The guy goes on to tell me that he also owns an exotic car dealership. I tell him I want to get a McLaren, and he goes through the app on his phone and tells me that he can get me a McLaren with about 15,000 miles on it for $220,000. Again, I could do it, but it would be irresponsible. My feeling on splurging on stuff like this is that you had better have so much cash lying around, so that if you buy an expensive watch or an expensive car, you won’t even miss it. For the time being, I am busy paying off my house, and I am almost done, and then I can start thinking about these sorts of things.

I want more money. Everyone does, but few people are honest enough to say it out loud. I want more money to buy watches and cars. I also want more money to buy a condo in Miami. I also want more money to give away. I want more money, plain and simple. The newsletter provides me with a steady income, but if I am going to get stupidly rich, it will have to happen in the markets. That’s why drawdowns are so painful—I get further away from my goal.

Everyone remembers the Gordon Gekko “Greed Is Good” speech. “Greed, in all of its forms -- greed for life, for money, for love, knowledge -- has marked the upward surge of mankind.” Soaring rhetoric from Oliver Stone, who set out to satirize Wall Street, and ended up inspiring an entire generation of strivers. We could use a little bit of that today. A less nice word than greed is avarice, which conjures images of Ebenezer Scrooge splashing around in gold coins. You see, people have a complicated relationship with money. They want more money, but they don’t want to be seen as wanting more money. It is important to live a life without internal conflicts. For all the people who rank on Elon Musk for hoarding money, if you gave them $100,000, for sure, they would take it and hoard it. Let’s all be honest here—we all want more money, because you can do cool things with money. Funny story—I had a student once who said he did not want money—he said it would make his life too complicated. There is truth in that. But later in the semester, he wrote a paper saying that he wishes he could have marched in drum and bugle corps that summer, but didn’t have the money. People are funny.

Of course, there are more important things than money, and if I sucked at the newsletter for the rest of my life, and if I sucked at writing books for the rest of my life, and if I sucked at trading for the rest of my life, and I never got to buy Richard Milles or McLarens or condos in Miami, I would still be plenty happy. I have enough. This is where I part ways with the biggest jagoff to ever walk the earth, Jack Bogle, who wrote—count ‘em—twelve books about why people should make less money. The index fund was one of the most important financial innovations in history (and also a slow-detonating bomb), and he made zero money off of it—his choice. Which is weird! If he didn’t want the money, why didn’t he make it and then give it all away? He just chose not to make it, and he spent practically his entire adult life trying to impose his bizarre personal preferences on others. If Vanguard had charged one basis point more on its funds, he would have been a billionaire. Chose not to do it. Fucking Jiminy Cricket, that guy was. Thankfully, they broke the mold.

But yes, of course there are more important things than money. Of course there are. Family, pets, spirituality, friends, sobriety, character, to name a few. And the thing about making money is that you can do it the easy way or the hard way. The easy way is bad. The hard way is good. There really are no shortcuts. You can go through the SEC press releases and see all the people who were trying to do it the easy way. Occasionally there is a gold rush, like the SPAC boom, or data centers, and all the raccoons get involved. I have never been a raccoon. Real estate in the mid-2000s comes to mind—there were a lot of raccoons in the movie The Big Short. There are a few ways you make money:

1) You are exceptionally talented

2) You have an idea

a. You execute on the idea

3) You are in the right place at the right time

4) You have a first-class motor

5) Your work is an obsession

Elon Musk is basically all of these things. I can tell you how not to make money—don’t do these things. Sit around and wish you had more money, while shitting on those who do. If you want it, it is there for you. Some organizational and management ability helps. Of course, a big part of this is being in the right place at the right time, something I haven’t quite mastered yet, and probably never will. A little bit of luck always helps. But anyone who has done this gig will tell you that luck is only a small part of it, unless you’re playing the stupid lottery.

I see absolutely nothing wrong with wanting more money. I see absolutely nothing wrong with wanting more money out in the open in front of God and everyone. There are levels to this—maybe you fix RVs and you want a plot of land so you can have some chickens and goats. Maybe you want to get a raise so you can trade in the old minivan and get a proper Toyota Highlander. And then there are fancy-asses like me who want supercars and watches. No matter what part of the scale you are on, it is virtuous to want to improve your own circumstances. As you know, there are some politicians who do not think that is a virtue, but we’re not going to talk about politics or taxes here.

Dave Ramsey says that money is not the root of all evil, but the love of money is. I disagree with that, too! Back to Bogle again—if he loved money, and charged an additional basis point, he could have donated to saving the gay whales or the Human Fund or whatever pet cause he dreamed up at the time. It’s okay to love money, because you can do a lot of good with money. Even if you just buy stupid shit, you are keeping people employed who make the stupid shit, along with the people who sell the stupid shit, and the people who package and ship the stupid shit, and the shareholders of the company who makes the stupid shit. The Mr. Money Mustaches of the world tell us that consumption is evil. Okay, then, fuckface, go be Gandhi and own a pair of sandals. But they’ll have air conditioning. They’ll have a dishwasher. They won’t forgo the typical creature comforts that are standard in Americn households. Just the “frivolous” stuff like superwatches and supercars—which nobody needs, right? Look, some people I know spend a lot of money on weird shit. To each their own—live and let live! One man’s creature comfort is another man’s luxury. And as you have probably heard from the libertarians, Americans live in unimaginable luxury. The fuzzy foreigners don’t even have air conditioning. That would make me grumpy.

If you’re my age, and you grew up in the 80s and 90s, then you knew what deprivation was. I grew up in a 1200-square foot house (more, after we finished the basement). We had three channels on the TV, and we used to have to turn the antenna with the rotor to tune in to them. My grandmother splurged and got cable in 1983 so I could watch Knight Rider. Cars were so bad that we had Lemon Laws—you’d buy a car that was such a piece of crap that it broke down as soon as you drove it off the lot. I don’t know if you have listened to a cassette tape in a while, but it’s a wonder we put up with that tape hiss for all those years. On a boombox. Our standard of living has vastly improved, and we are so fat and happy that deep down, we wish we were poorer. Wild stuff. Calvin Coolidge’s son was playing out on the White House lawn, got an infected blister on his toe, and was dead in a week—six months before penicillin was invented. Just 100 years ago!

So yes, I am greedy, and I hope other people stay greedy. There are still problems left to solve, and they won’t get solved unless people can get rich in the process. I heard recently that we just made a step-function advance in curing pancreatic cancer. I hope someone gets rich on that—pancreatic cancer killed my favorite uncle last year. 35,000 people die every year from car accidents. In the 1970s, it was 70,000. Self-driving cars is going to take it to zero, and I hope someone gets fantasically rich on that. 50 years from now, kids will say to each other, you know, in the old days, people used to die in car accidents? Unbelievable. I hope 1,000 people get to buy Richard Milles from that. Imagine if Jack Bogle were president. My goal is to get rich, but a secondary goal is to prove Jack Bogle wrong—about everything.