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Harold Geller: "I Sue Financial Advisors" (EP.236)

19 januari 2023 · 1 uur 4 min
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Our guest today, Harold Gellar, is a lawyer who helps clients dealing with fraud and negligence perpetrated by financial advisors, and is a passionate advocate for investors and their rights. Tuning in you'll hear details of some of the most common issues Harold has come across in his work, along with his practical advice for financial advisors and investors. We discuss the importance of clear communication between advisors and their clients, the concept of KYC (Know Your Client), and simple steps investors can take to ensure that their advice is properly understood by their clients. Harold goes on to provide an outline of factors that could make individuals vulnerable to negligent financial advice (such as marital problems or a sudden health crisis) and how to gain perspective in extreme situations. We also discuss the key differences between salespeople and financial advisors, the type of credentials investors should be looking for, and how regulation needs to be modernized in Canada for investors to be properly protected. Harold has been in this industry for a long time and is immensely knowledgeable on the subject of fraud and negligent investment advice. Lees meer

Key Points From This Episode:

An overview of Harold's practice and how he helps clients get their money back. (0:03:22)

The difference between salespeople and financial advisors and the vulnerability of investors. (0:05:40)

Practical advice for investors to ensure their financial advisor is doing due diligence and the concept of KYP (Know Your Product). (0:10:46)

The concept of KYC (Know Your Client) and how to be sure your financial advisor understands you as a client. (0:15:32)

The type of individuals who are particularly vulnerable to negligent financial advice, and why we can all be vulnerable in certain situations. (0:18:33)

The role of the trusted contact person in Canada specifically, and how to know when to take the advice of your financial advisor. (0:25:13)

Harold's thoughts on what is causin…
Top Learnings from 2022 (plus 23 in 23 Special Guest Shaun Tomson) (EP.235)

12 januari 2023 · 1 uur 23 min
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As we kick off the new year, we wanted to look back at our biggest areas of learning from last year. So this episode serves as a great companion piece to our year-end recap from a couple of weeks ago, but the focus here is on the personal impact that specific guests, ideas, and topics had on each of our lives. We cover ICAPM thinking, the nature of money, financial literacy, setting financial goals, the history of index funds, and more. For the second half of the show, we are joined by the amazing Shaun Tomson, former world surfing champion, author, and renowned speaker. Shaun is here to talk a bit about his latest book, co-authored with Noah benShea, entitled The Surfer and the Sage. We get to hear about Shaun's belief in the power of words, the specific conditions that can enforce this power, the lessons he has taken from a life in the ocean, and how the tragedy of losing his son influenced his life's trajectory. Join us to catch it all. Lees meer

Key Points From This Episode:

Differentiating between the CAPM and ICAPM theories. (0:08:02)

Long-run risks in stocks and bonds; demystifying safety claims. (0:14:46)

Further illumination on the concept of money and how to think about it. (0:24:27)

Learnings around the empirical side of financial literacy. (0:31:00)

Improved setting of financial goals and common mistakes that many of us make. (0:32:24)

Filling in the gaps in an understanding of the history of index funds. (0:35:57)

A one-minute recap of our episode with Allison Schrager from last year. (0:37:47)

A quick review of Shaun Tomson's book, The Surfer and the Sage. (0:39:38)

Shaun explains the significance of the wave as a metaphor. (0:43:28)

The tragic passing of Shaun's son in 2006 and how this redirected his life's purpose. (0:45:10)

Shaun explains his CODE method for transformation. (0:49:35)

The significance of the structure of the book and the motivation behind it. (0:56:38)

Unpacking the importance of purpose when making financial decisions. (0:59:4…
Prof. Robert C. Merton: ICAPM, Retirement, and Models in Finance (EP.234)

5 januari 2023 · 2 uur 1 min
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Few people have impacted the way the world works, and today, we have the privilege of speaking to one of them. Professor Robert C. Merton is the Distinguished Professor of Finance at The Massachusetts Institute of Technology (MIT) Sloan School of Management and Professor Emeritus at Harvard University. He has a Ph.D. in Economics from MIT and is currently the Resident Scientist at Dimensional Fund Advisors. Professor Merton was awarded the Alfred Nobel Memorial Prize in Economic Sciences in 1997 for his work establishing a new method to determine the value of derivatives. He also created the Intertemporal Capital Asset Pricing Model (ICAPM), a popular tool to help advisors make informed financial decisions and understand market trends. In our incredible conversation, we cover portfolio theory, moving from Capital Asset Pricing Model (CAPM) to the Intertemporal Capital Asset Pricing Model (ICAPM), and how financial models work. We also discuss the difference between the value of your capital and the value of the cash flow that can come from that capital, why size can't be a factor, what aspects to consider when calculating the worth of an account, and the definition of market efficiency. We also delve into retirement, how to safely invest for it, what pitfalls to avoid, and how retirement funds may change over time. He also shares his opinion about some popular financial advise and what the roles of financial advisors should be. For all this and more, tune in to hear from the man behind the model and Nobel laureate, Professor Robert C. Merton! Lees meer

Key Points From This Episode:

We start with Professor Merton describing the concept of market efficiency. (0:04:28)

He explains the basics of his ICAPM asset pricing model. (0:09:10)

How portfolio theory changes when moving from single-period to multi-period. (0:10:46)

Hear a practical example of expected returns changing over time. (0:14:15)

Why ICAPM is dependent on the sensitivities to risk of an individual investor. …
2022: A Year in Review (EP.233)

29 december 2022 · 1 uur 42 min
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It has been an amazing year for the podcast. We have had some incredible guests during 2022 who have provided us and listeners with insights and thought-provoking ideas about the world of finance. We covered a lot of ground and to wrap up the year we decided to recap some of our favourite moments for listeners. In this episode, we highlight the many themes covered during this year, such as the basics of investing, stocks and bonds, how to make wise investment decisions, gender inequality, asset management, index funds, market trends, and portfolio management. We also highlight some of the indirectly topics indirectly related to finance such as the value of happiness, enjoying the pursuit of happiness, the importance of goal setting, and much more. Join us as we reflect on some of our best moments from the year and provide an overview of the many vital lessons we have learned in this final episode of the year for the Rational Reminder podcast. Lees meer

Key Points From This Episode:

Mac McQuown explains how the data revolution changed the game of investing. (0:09:05)

Robin Wigglesworth and tracking the performance of portfolios in the 60s. (0:12:56)

Professor Fama shares what it is like to see the impact of his academic work on the practice of asset management. (0:16:02)

Gus Sauter tells us about the role the University of Chicago played in the index fund revolution. (0:18:41)

Professor Fama unpacks what it means for a market to be efficient. (0:20:52)

Gerard O'Reilly and the differences in the types of market strategies available. (0:24:27)

Professor Betermier shares his research from multiple papers concerning tendencies towards growth and value stocks. (0:28:50)

Eduardo Repetto tells us whether having a portfolio consisting of 100% small-cap value stocks makes sense. (0:36:06)

Professor Koijen explains whether index funds distort market prices and make markets less efficient. (0:40:30)

Professors Berk and van Binsbergen discuss if it is possible to find skilled …
Dr. Annamaria Lusardi: The Economic Importance of Financial Literacy (EP.232)

22 december 2022 · 1 uur 9 min
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Gaining financial literacy is critical if you want to thrive in today's society. And yet, only about a third of the global population can be described as being financially literate. Joining us today to unpack the concept of financial literacy and its impact is Dr. Annamaria Lusardi, Professor of Economics and Accountancy at George Washington University. Dr. Lusardi has taught Economics for over 20 years, and her passion for financial literacy is reflected in everything she does. Her career has been instrumental in furthering the cause of increased global financial literacy, from being the Founder and Academic Director of the Global Financial Literacy Excellence Center, to serving as the co-chair of the G53 Financial Literacy and Personal Finance Research Network. In our conversation, Dr. Lusardi breaks down the definition of financial literacy, how it's measured by leading experts across the world, along with some of the key differences we see between people in richer and poorer countries. She explains why financial advice isn't a replacement for financial literacy and provides guidance on what we should be doing to educate various population groups. We also discuss how global trends have created an increased need for financial literacy as an essential skill, especially for young people, and why greater global financial literacy is beneficial to everyone, including governments and wealthier individuals. Tune in as we delve into the many facets of financial literacy and the important role it plays in our collective health, happiness, and success! Lees meer

Key Points From This Episode:

Lusardi defines the concept of financial literacy and the importance of being able to apply it as a skill. (0:04:30)

How experts measure financial literacy and some of the key challenges involved. (0:07:55)

The global survey that was conducted on financial literacy in 2014 and its dismal findings. (0:11:44)

The areas of financial literacy that people struggle with most and why the need for…
RR 231: Investing Basics and Common Questions (plus Reading Habits w/ Amer Kaissi) (EP.231)

15 december 2022 · 1 uur 23 min
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Today is our final episode featuring just the two of us before our annual wrap-up show, and we thought we would use this opportunity to cover some important foundational aspects of rational investing. Ben goes over some of the most fundamental concepts about market prices, risk, and actual returns before answering five common questions that relate to this level of information. From investing in an employer's stock to predicting the future and real estate comparisons, these five touch-points are always worth returning to, and should even interest the more experienced of our listeners. For the second half of the show, we offer a quick book review of The Culture Playbook by Daniel Coyle, and have a brief and illuminating conversation with Professor Amer Kaissi about his book, Humbitious, and some of his thoughts on the part that reading plays in rich and progressive life. Press play to catch all this and more on the Rational Reminder Podcast. Lees meer

Key Points From This Episode:

Picking up a thread from our discussion on the 2% Rule. (0:06:05)

Getting to grips with investing basics. (0:10:45)

How market prices work in response to traders' actions and risk. (0:17:59)

The main determinants of actual returns and starting points for your portfolio. (0:23:15)

Unknowable futures and the eternal doom and gloom predictions. (0:35:43)

Assessing the value of owning an employer's stock. (0:38:21)

Holding stock picks in Tax-Free Savings Accounts. (0:42:07)

How to prepare a portfolio when a recession is predicted. (0:43:49)

Comparing investments in real estate with the stock market. (0:45:14)

Weighing the value of building and emergency fund. (0:47:11)

A thirty-second recap of our episode with Cliff Asness. (0:50:06)

Today's book review focussing on the lesson from The Culture Playbook by Daniel Coyle. (0:51:48)

Professor Kaissi shares a quick summary of his book, Humbitious. (0:58:40)

The potential to develop characteristics and the role that reading plays. (0:59:38)

Pro…
Prof. Robert Frank: Success, Luck, and Luxury (EP.230)

8 december 2022 · 1 uur 21 min
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The world is a highly competitive place, and becoming successful requires hard work, dedication, and luck. This is the view of today's guest, Professor Robert Frank, who helps us unravel the nuance of conspicuous consumption trends and the role of luck in gaining financial success. Professor Frank is the emeritus Henrietta Johnson Louis Professor of Management at Cornell University and holds an MA in statistics and a Ph.D. in Economics from UC Berkeley. He is also a prolific author, having written 12 books, financial textbooks, and many peer-reviewed articles in journals such as the American Economic Review, Econometrica, and Journal of Political Economy. He is passionate about how policy can help drive positive consumer behaviour, reduce inequality, and increase individual happiness. His work has also focused on the role of luck in achieving financial success which he covers in his book Success and Luck. In this episode, we unpack how individuals can improve societal collective action, the role of policy in driving those changes, and how luck interplays with success. We discuss economic and financial relativism, the dangers of conspicuous consumption, how expenditure cascades occur, and what influences consumption trends in society. We also dive into the topic of luck, whether wealthy people are happier, what behavioural changes are needed to create a better society, and more. Lees meer

Key Points From This Episode:

Professor Frank describes the difference between departures from rational choice with regret and without regret. (0:04:34)

Whether he classifies his work as behavioural economics. (0:07:38)

An explanation of economic and financial relativism. (0:10:50)

The role of economic and financial relativism in consumption trends. (0:12:44)

Find out what constitutes a positional good. (0:16:56)

How the consumption of positional goods affects psychological well-being. (0:19:32)

Why people choose to engage in consumption arms races. (0:21:52)

The relationship betwee…
The 2% (!?) Rule for Retirement Spending (EP.229)

1 december 2022 · 1 uur 13 min
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Traditionally, people saving for retirement and financial advisors relied on the 4% rule when calculating how much to save for retirement and the associated income those savings would provide after retirement. What if you found out it does not work? Is there another option? Today, we offer you an alternative approach, which is the 2% rule for retirement spending. Before we delve into today's main topic, we update listeners on the recent London meet-up, what to expect on upcoming shows, and who our special guest is to kick off the first episode of 2023. Then, we discuss today's main topic and learn what the 2% rule is, how it compares to the 4% rule, and whether the safe percentage for retirement is actually higher. We unpack retirement spending through the lens of several empirical papers, historical data, and market comparisons. We also find out why the US market has always been able to bounce back from uncertainty and whether there is empirical data to support the 4% rule. We also talk about the many financial challenges and opportunities that young people face, the biggest mistake people make regarding retirement, the value of financial literacy, book reviews, and more! Lees meer

Key Points From This Episode:

An update on the 22 in 22 Reading Challenge. (0:05:21)

Outline of today's content and the main topic: the 2% rule for retirement spending. (0:06:27)

An overview of the "2% rule", the motivation behind it, and how it was formulated. (0:08:17)

We discuss if the safe withdrawal rate for retirement savings is higher than 4%. (0:13:31)

The inspiration for the higher average realized rate of return on investment theory. (0:19:59)

Whether the past returns on US stocks will repeat in the future. (0:21:54)

Why the US stock market has been historically exceptional and resilient, and how other markets compare. (0:23:44)

The biggest limitation of the seminal work which helped established the 4% rule. (0:28:38)

How data gaps were dealt with in the paper by Scott Riecken…
Eduardo Repetto: Deep Dive with Avantis Investors' CIO (EP.228)

24 november 2022 · 1 uur 36 min
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In this episode, we are joined by the CIO of Avantis Investors, Eduardo Repetto, to have an in-depth conversation about his philosophy and approach to many of the central concepts that are important to our listeners. Eduardo weighs in on asset pricing factor investing, premiums, and also shares some of his perspectives on what makes Avantis different from its competitors. Eduardo's wealth of experience and technical know-how make this very practical exploration, complete with some inventive and demonstrative analogies. Despite the high-level concepts discussed, our guest's ability to communicate these in an accessible manner also helped maintain a level of approachability throughout. Toward the end of the episode, we get to hear a little about Eduardo's Ph.D. in aeronautics and some of the surprising overlaps he sees between his two fields of interest. Lees meer

Key Points From This Episode:

Eduardo's approach to communicating what Avantis can offer their clients. (0:02:57)

Advantages of the ETF structure for managing portfolios. (0:05:07)

Advice for investors for quantitatively assessing the expected return advantage of a factor-tilted portfolio. (0:10:26)

Practical approaches for individual investors when assessing a factor tilt in portfolios. (0:13:54)

Eduardo unpacks the idea of trust in relation to the premium. (0:20:45)

When does a completely small-cap value portfolio make sense? (0:27:23)

Avantis' method for targeting value and profitability. (0:31:03)

The weighting of different metrics that Avantis uses when building portfolios. (0:34:43)

Eduardo unpacks cash profitability versus operating profitability. (0:36:53)

The approach at Avantis to sector weights. (0:39:56)

Understanding adjusted book value when pricing a company. (0:43:53)

Eduardo describes the premium for the Goodwill adjustment. (0:50:02)

How Avantis views pursuing credit premium in fixed income investments. (0:51:32)

Determining the size of factors tilts on particular products. (0:57:05)

…
Who Should Invest in (Cap Weighted) Index Funds? (EP.227)

17 november 2022 · 1 uur 11 min
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In today's episode, we pull relevant quotes from past guests (namely John Cochrane, Gene Fama, and Jonathan Berk) to extricate who should own market cap funds. We look at the variable risks of value stocks and factor investing and hear counter-views on owning the market. We also delve into the hot topic of tax loss selling, with an overview of a recent Financial Analyst Journal paper on loss harvesting outcomes, sorted by investor profiles. This episode will get you up to date on the biggest finance news of the week, from crypto collapses to Amazon's catapulting gains and losses. Tune in to hear all of this and more, including a recap of our conversation with Dave Goetsch and our Financial Literacy Month book reviews. Lees meer

Key Points From This Episode:

A neat way to keep track of the value of your purchases over time. (0:00:33)

The results of the Rational Reminder financial literacy survey. (0:02:44)

An overview of this episode's topics. (0:05:45)

Who should invest in market cap-weighted index funds. (0:07:28)

How to determine whether you're different from the average investor. (0:16:13)

Gene Fama's take on the possibility of identifying state factors. (0:22:13)

The variable risks of value stocks. (0:23:25)

What drives people to increase their value tilts over time. (0:25:11)

The risks of factor investing, and trading in general. (0:28:26)

Jonathan Berk's take on owning the market. (0:31:53)

A summary of who should invest in total market index funds. (0:33:20)

The big crypto news of the week! (0:38:21)

Other significant market news. (0:42:17)

An overview of a recent Financial Analyst Journal paper on loss harvesting outcomes, sorted by investor profiles. (0:44:59)

Our book reviews for Financial Literacy Month. (0:55:15)

A recap of our conversation with Dave Goetsch. (1:01:47)

A few of our listeners' reviews. (1:02:50)

Participate in our RR CE Credits Survey:

https://forms.office.com/Pages/ResponsePage.aspx?id=xVA-B3TS3UeuUte5Yx-hRi0Vpj3fzvhNpOTm6eRMY…
Colonel Chris Hadfield: An Astronaut's Guide to Life on Earth (EP.226)

10 november 2022 · 48 min
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In this episode, we speak to renowned Canadian figure Colonel Chris Hadfield. For those who don't know, Chris is a heavily decorated astronaut, engineer, and pilot, and has received many awards, such as the Order of Canada, the Meritorious Service Cross and the NASA Exceptional Service Medal. Colonel Hadfield became a worldwide sensation with his video of David Bowie's "Space Oddity" which was viewed by over 75 million people. He aims to make space more accessible and continues to share the wonders of outer space and science with as many people as possible. Besides his phenomenal professional background, he is also known for his music which he writes and plays on earth and in space! He is also the author of several books, namely An Astronaut's Guide to Life on Earth, You Are Here, and a children's book, The Darkest Dark. Although Colonel Hadfield has a very different background from previous guests, his 35-year career has afforded him many lessons that apply to life, which he shares in our conversation with him. We learn the importance of goals and why reaching your goals should not define your happiness. Hear ways to overcome fear when facing uncertainty, the value of competence, and why enjoying the road to success is more important than success itself. Find out why sweating the small is essential to success, whether Colonel Hadfield suffers from imposter syndrome, and where true happiness comes from. Tune in and discover the secret to success and happiness in this one-of-a-kind conversation with special guest, Colonel Chris Hadfield! Lees meer

Key Points From This Episode:

What motivated Commander Hadfield to take pictures onboard the International Space Station. (0:04:10)

He briefly explains the amount of effort that went into taking pictures for his book You Are Here. (0:05:14)

What lessons Commander Hadfield learned as an astronaut that he applies to life. (0:06:34)

How to keep motivated to achieve your goals with the knowledge that you probably won't achieve them…
The Index Fund "Tipping Point" (EP.225)

3 november 2022 · 1 uur 14 min
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Are index funds a menace to the market? Are pension funds still a wise way to secure your financial future? In this episode, we discuss index funds, the state-sponsored pension plan in Canada, and much more. First, we unpack the nuances of index funds and take a look at the impact that active and passive investors have on the market. We discuss current index fund trends, when to switch from a passive to an active investor, and the dreaded index fund tipping point. To help us understand pension funds, we also chat with Jordan Tarasoff, a financial planner at PWL Capital, about the recent controversy regarding state pension schemes in Canada, and he provides us with some valuable insights into the government's upcoming plan. We switch up our usual book review to celebrate Financial Literacy Month and share five recommended books that will help you improve your understanding of finance. We also try something new by giving listeners a condensed overview of a previous episode with one of our favourite guests, Scott Rieckens. Finally, we go through some of the feedback and comments we've received from the growing Rational Reminder community about the show and our recent financial goals survey. Lees meer

Key Points From This Episode:

What to look forward to in next week's episode. (0:05:08)

Hear about a special promotion to celebrate Financial Literacy Month. (0:05:43)

Introducing today's topic and what to expect in the episode. (0:05:56)

Worries and biggest critiques of index funds. (0:08:23)

Current trends regarding index funds in relation to the market. (0:09:40)

When investors should switch from passive to active. (0:12:45)

Some good news about the index fund tipping point. (0:15:46)

What investors should be aware of when actively investing. (0:16:32)

How informed and misinformed managers contribute to the index fund tipping point. (0:19:38)

Who the investors and managers are that change to passive investment. (0:20:52)

How switching from active to passive investing…
Prof Scott Cederburg: Long-Horizon Losses in Stocks, Bonds, and Bills (EP.224)

27 oktober 2022 · 1 uur 10 min
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Are stocks and bonds good in the long game? What are the best long-term investment options? In this episode, we speak to Professor Scott Cederburg about the nuance surrounding the stock market, bonds, and other investment types in the long term. He has a Ph.D. in Finance from the University of Iowa and is currently the Associate Professor of Finance at Eller College of Management at the University of Arizona. His research focuses on the long-horizon performance of a range of asset classes and investment types and has published in high-ranking academic journals, making him the perfect person to speak to about the subject. We discuss the topic through the lens of several papers he has written on stocks, bonds, retirement savings, and return predictability. In our conversation, we unravel the nuance of the returns on long-term stocks and bonds, hear details about his research design, and learn how unanticipated events can affect the market. He also provides insight into the different biases surrounding long-term investments, the block bootstrap approach, reasons why the block bootstrap approach is needed, and why bonds and bills may not be the long-term investment you were hoping for. We also discuss the best options for investors regarding pre-tax and post-tax accounts and the differences between high-beta and low-beta portfolios. He also shares some basic steps for investors to help them protect their investments. Join us as we dig into the past to uncover the financial future with Professor Scott Cederburg. Lees meer

Key Points From This Episode:

We begin with Professor Cederburg describing his research design for his work investigating long-term returns on stocks and bonds. (0:04:20)

Hear examples of how unanticipated events lead to impacts on stocks and bonds. (0:08:08)

What the overall trend in the data was from his research on stocks and bonds. (0:11:05)

Why considering different biases is essential for financial decision-making. (0:11:45)

How the historical experi…
A Financial Goals Master List (n=310) (EP.223)

20 oktober 2022 · 1 uur 6 min
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We recently created and conducted a very interesting survey based on financial goals, and today, we get to share some of the data we collected and the answers that were given to the questions. Although there are some definite limitations to our expertise as surveyors and data collectors, the findings are most definitely illuminating, surprising, and useful. Listeners will get to hear a bit about the process of building the survey as well as some of the raw numbers and data before we get into the list of goals that were submitted, collated, and ranked. We also share some of the ways that these were split across demographics such as age and gender. Apart from this focus on the survey, we share some thoughts on Eat the Rich, Coin, and The Next Millionaire Next Door, and finish off the show with some very impactful letters from listeners that we have received recently. Lees meer

Key Points From This Episode:

Thoughts on the new Netflix show, Eat the Rich, and the story of GameStop. (0:01:58)

What to expect on the podcast in November during Canadian Financial Literacy Month. (0:05:17)

Reflections on the new film, Coin, and the founding of Coinbase. (0:08:08)

Introducing the results from our recent survey on goals. (0:11:23)

The process of building the survey and the questions we included. (0:18:22)

A look over the basic data of the survey. (0:22:27)

Popular objectives from the survey and how these were split across different demographics. (0:23:17)

The answers that were given in relation to each specific question. (0:28:02)

Developing best practices for goal setting for an advisor environment. (0:30:17)

Limitations to our expertise in designing this survey and analyzing the data. (0:32:43)

Running through the complete list of goals in order. (0:34:29)

Introducing this week's book discussion on The Next Millionaire Next Door. (0:39:46)

Standout findings from the research that was conducted for the book. (0:44:00)

Utilization of an 'expected net worth test' in the bo…
Cassie Holmes: Being Happier (EP.222)

13 oktober 2022 · 1 uur 12 min
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There is more and more research on the determinants and results of happiness in human life, and on the show today we get to do an amazing deep dive on this subject with social psychologist, and author of Happier Hour, Cassie Holmes. Cassie is currently running a course at UCLA Anderson School of Management called 'Applying the Science of Happiness to Life Design', and her book draws directly from the content of this course. In our chat, Cassie shares some definitive data on what actually influences our happiness in significant ways, how to invest and allocate your available time, approaches to offsetting hedonic adaptation, and the vital importance of relationships and exercise. Our guest also talks about popular misconceptions and cultural perceptions about success, and why assessing your values and purpose can make achieving more happiness much more realistic. It is here that we find Cassie's main thesis; that through reflection and tracking we can determine more accurately how to use our time in the different parts of our lives and increase our day-to-day happiness, so make sure to join us for this episode of the Rational Reminder. Lees meer

Key Points From This Episode:

The science behind the important benefits of happiness. (0:02:17)

Current research into the measurement of happiness. (0:04:27)

Cassie talks about the roots of the course she teaches on happiness. (0:07:02)

Misconceptions about what makes us happy and the lasting power of notions of success. (0:10:25)

The cultural roots of our perceptions of happiness. (0:14:58)

Determinants of happiness; Cassie shares the biggest factors in our emotional landscape. (0:20:16)

Working towards a goal, time tracking, and entering flow states. (0:25:28)

Happiness as a decision and as a disposition; how much control do we have? (0:30:26)

How comparison undermines and robs us of happiness. (0:37:01)

Cassie unpacks how to understand the role of relationships in our lives. (0:38:30)

A story from Cassie illustrating th…
Permanent Life Insurance (EP.221)

6 oktober 2022 · 1 uur 16 min
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Of course, you want to protect your family and your savings from unforeseen consequences, but is life insurance the best option? Can life insurance be an investment rather than a cost? In today's episode of the Rational Reminder Podcast, we take a look at everything life insurance and dig into some hard-hitting research on the subject. We break down the various insurance products available and unravel the nuances regarding returns, dividends, and the associated fees. We discuss why there is so much confusion regarding returns and associated risk, how your contribution can affect your returns, and why you may not get the payout you expected. We also delve into what makes each insurance product different from the next, whether predictions on insurance policy returns are possible, and how insurance compares to other asset classes. If you're looking for insight into the potential tax benefits of life insurance and a breakdown of the different scenarios where life insurance is needed, this is the episode for you! Lees meer

Key Points From This Episode:

The main topic of the episode: permanent life insurance. (0:04:29)

Defining insurance and how it is typically structured. (0:04:44)

'Term life insurance' and how it works. (0:05:41)

A brief outline of the differences between term insurance and permanent insurance. (0:07:37)

Details about term life insurance and the benefits to the policyholder. (0:09:37)

Another type of life insurance: universal life insurance. (0:11:05)

How investments within a life insurance policy are designed. (0:13:20)

An interesting insight Ben came across while researching insurance. (0:14:38)

Non-participating whole life insurance and the associated cash value. (0:16:00)

A breakdown of participating life insurance and what makes it different. (0:18:42)

The basis for performance and premiums on participating insurance. (0:21:43)

Whether or not it's possible to predict returns from insurance products. (0:25:25)

Reasons for the obscurity surround…
Jonathan Berk and Jules van Binsbergen: The Arithmetic of Active Management, Revisited (EP.220)

29 september 2022 · 1 uur 23 min
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Do you feel like you have a good grasp of financial markets? Think again! In this episode, we take a plunge into the world of financial markets with experts Jules van Binsbergen and Jonathan Berk. Jules is a Professor of Finance at the Wharton School of the University of Pennsylvania and Jonathan is a Professor of Finance at Stanford Graduate School of Business. They also host a popular podcast called Else Equal, which explores the science and strategy of making better financial decisions, and have written several academic papers that challenge the status quo. In our conversation, we discuss their research on the relationship between manager skill and fund performance, the best ways to measure performance, and reasons why benefits are in favour of the managers. We also explore the dogma surrounding mutual funds, the differences between active and passive management, and how to measure efficient capital markets. Listeners will also hear perspectives that challenge their understanding of capital markets and viewpoints that completely disagree with previous guests. Although we have covered this topic before in previous episodes, this conversation will fundamentally change the way you view financial markets and how to think about them. Lees meer

Key Points From This Episode:

What information fund performance contains about manager skill. (0:04:04)

Reasons why manager skill and performance are unrelated. (0:04:59)

We learn how manager skills should be measured. (0:06:57)

How to choose the appropriate benchmark to measure value added. (0:09:26)

Find out if you can use factor-mimicking portfolios to measure risk-adjusted returns. (0:12:05)

Whether funds that directly target risk factors can be used as an investable benchmark. (0:16:35)

What the skill of active managers are when skill is measured as value-added. (0:20:52)

The proportion of value-added between security selection and market timing. (0:23:20)

Discussion about how persistence manifests when it is measured by v…
Understanding Crypto 17: Ari Juels: The Technical Case for Blockchain

23 september 2022 · 1 uur 23 min
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Critics of blockchain often say that it is nothing more than a database, but today's guest, Ari Juels, has a different opinion. His technical expertise (he is a Professor of Computer Science at Cornell Tech), combined with his ability to understand both sides of a divisive topic like this one, make for a very insightful conversation about Bitcoin, NFTs, and smart contracts. We talk about the reasons for the valid skepticism that surrounds blockchain technology, the various reasons that Ari believes that it is a powerful, useful tool, despite its downfalls, pyramid schemes, decentralized exchanges and more! Lees meer

Key Points From This Episode:

The significance of the Bitcoin innovation to Ari's field of study. (0:03:40)

What piqued Ari's initial interest in digital currency. (0:04:46)

Ari explains the difference between permission and permissionless blockchains. (0:06:27)

Comparing a permission blockchain with a distributed-append-only database with authorized contributors. (0:08:34)

A number of reasons why permissionless blockchains have been so widely embraced (despite Ari's initial prediction to the contrary). (0:12:24)

Fraud in the cryptocurrency space; Ari shares his thoughts. (0:14:28)

The benefits of the cultural phenomenon of NFTs. (0:19:25)

Examples of NFT-related issues that still need to be addressed. (0:26:04)

How smart contracts can be used by criminals to their advantage. (0:30:09)

Why smart contracts are well suited for compliance. (0:32:02)

An example of a smart contract pyramid scheme. (0:35:48)

Some of the pros and cons of the inflexibility of smart contracts. (0:41:09)

What flash loans are and what they can be used for. (0:46:11)

Understanding the value of oracle systems. (0:50:04)

How the Candid system that Ari's group developed helps to mitigate the problem of lost Bitcoin keys. (0:57:04)

Ari explains the advantages and disadvantages of a decentralized exchange. (01:01:19)

How the blockchain has improved code writing. (01:07:57)

The …
Expected Returns for Alternative Asset Classes (plus Reading Habits w/ David Senra) (EP.219)

22 september 2022 · 1 uur 29 min
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The type of assets which usually come to mind when considering investments are stocks, bonds, or cash, but what are the alternatives? And what kind of returns do alternative asset classes offer? In today's episode, we delve into the returns which can be expected from alternative asset classes such as private equity, venture capital, angel investing, private credit, hedge funds, direct real estate, and cryptocurrencies. Hear an in-depth analysis based on empirical studies and the expertise of your hosts, Ben and Cameron, to discover whether there is any merit to alternative asset classes as investments. We unpack the extra layer of complexity associated with predicting returns on alternative assets, how to approach calculating returns, and why the associated fees are an essential consideration. We also hear details about an interesting conference Cameron recently attended and briefly recap cryptocurrencies as an investment. You'll also hear our conversation with our 22 in 22 reading challenge guest David Senra about his reading habits, the books that most inspire him, and his advice for people who want to read more. Lees meer

Key Points From This Episode:

Outline of today's main topic: expected returns for alternative asset classes. (0:01:51)

Why predicting returns of alternative asset classes has an extra layer of complexity. (0:03:18)

How to approach estimating the returns of private equity, specifically buyouts. (0:05:04)

We unpack historical data regarding the returns of private equity. (0:07:35)

Calculating the returns on venture capital and reasons to be cautious about it as an asset class. (0:16:35)

The distribution of returns from venture capital based on the market numbers. (0:20:09)

Learn what angel investing is and its associated returns. (0:20:54)

What returns on angel investing are most dependent on and why. (0:22:21)

The different types and the associated returns. (0:25:23)

Hear about the fees associated with private credit. (0:27:42)

We unravel the …
Understanding Crypto 16: Chris DeRose: Uncensored Crypto Perspectives

16 september 2022 · 1 uur 37 min
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In this episode, we speak to Chris DeRose, software developer and former co-host of the Bitcoin Uncensored podcast, about both the downsides and upsides of cryptocurrencies and the associated technologies. We took the time to dive deep into the subject with Chris and learned about some of the common misconceptions about blockchain technology, the value of cryptocurrencies to society, ways in which the crypto space has evolved, using economic theories to understand financial systems, the definition of money, what he thinks about the associated technologies, the role blockchain technology can have in society and why cryptocurrencies will not replace the dollar. Lees meer

Key Points From This Episode:

The motivation behind Chris's decision to get involved with Bitcoin in 2010. (0:00:48)

How the Bitcoin community has evolved since Chris got involved in 2010. (0:03:00)

Some of the common misconceptions associated with blockchain technology. (0:06:03)

Whether new technologies pushing back against regulations is common. (0:08:08)

Ways in which Chris's perception of crypto has changed since he discovered it. (0:09:53)

Chris explains what his definition of money is. (0:11:19)

Find out what Bitcoin actually is, if it is not money. (0:14:39)

Aspects of the current financial system that Bitcoin improves on. (0:16:42)

A discussion around the recent controversy regarding Canadian trucker convoys. (0:17:54)

Some of the problems anonymity associated with cryptocurrencies causes. (0:20:33)

Why not being able to verify transactions is a problem for privacy coins. (0:21:18)

A discussion about the US monetary system and the US dollar. (0:24:12)

Chris discusses the reliance on economic theories to understand the economy. (0:30:59)

What he thinks about crypto markets through the lens of market efficiency. (0:32:26)

Whether crypto markets can be manipulated or not. (0:33:49)

Why Chris thinks Bitcoin will not make traditional regulations around payments obsolete. (0:35:32)

Another…
Colleen Ammerman: Gender and Human Capital (EP.218)

15 september 2022 · 1 uur 8 min
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The gender pay gap is still a persistent problem in today's society, reflecting the overall state of gender inequality. It is full of complexity and comprises different facets, making it hard to understand the overall situation. We have covered the topic before, but in this episode, we go into a whole new level of detail. To help us unpack the nuance of this essential topic is Colleen Ammerman, Director of the Gender Initiative at Harvard Business School. She is also the author of Glass Half-Broken, providing readers with hard evidence and detailed analysis of the different drivers of gender inequality in the workplace. We cover the basics of gender inequality, such as how it currently exists, how it manifests in the workplace, and the subtle and less obvious ways it occurs. We also find out whether men are generally aware of the problem, the obstacles that prevent men from taking action, and the power men have to initiate positive change within organizations. Colleen also untangles the intricacies of the topic, explaining why gender equality is still a pervasive problem, how gender inequality extends to promotions, how management explains away the issue, how gender equality is also beneficial for men, and the influence of perceived gender roles in career decisions. Tune in and learn about the intricacies of gender inequality, as well as the possible solutions, with Colleen Ammerman! Lees meer

Key Points From This Episode:

We start by finding out what the current situation is for women in the workplace. (0:03:22)

How to quantify gender inequality symptoms in the workplace. (0:04:12)

Whether there are similar effects of gender inequality for men of colour. (0:05:03)

Why people might still deny that there is a problem concerning gender inequality. (0:05:35)

An outline of the career obstacles that uniquely affect women. (0:07:18)

Find out if men are aware that women have additional barriers to overcome. (0:12:03)

Reasons why women may leave the workplace before retainin…
Understanding Crypto 15: Prof. Vili Lehdonvirta: Cryptocracy: The Obfuscation of Power

9 september 2022 · 1 uur 7 min
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Today, we speak to Vili Lehdonvirta, Professor of Economics, Sociology, and Digital Social Research at the Oxford Internet Institute at the University of Oxford. Professor Lehdonvirta is a social scientist whose research focuses on ways digital technologies are reshaping the organization of economies, including their associated social effects. He is also the author of two books, Cloud Empires and Virtual Economies, which provide readers with an in-depth look into the power that crypto platforms hold and a well-rounded characterization of digital markets. In this episode, we talk about the ideological underpinnings of crypto and the role of governance in making cryptocurrencies possible. We discuss the role of states in scaling markets, how states and platform companies differ, the impacts of smart contracts on governance issues, and how control and power are centralized within crypto markets, as well as the social implications of blockchain technology. Listeners will also learn about past controversies within the crypto space, why people are still needed within crypto, and the blockchain paradox, plus more! Lees meer

Key Points From This Episode:

We start by learning about John Perry Barlow's vision for cyberspace. [0:05:06]

Find out about the role that states play in markets. [0:07:03]

How markets function at scale if the state is not involved. [0:07:55]

Professor Lehdonvirta's view on whether governance may precede markets. [0:08:59]

The role massive platform companies play in today's economy. [0:09:44]

Ways in which states and platform companies differ. [0:10:42]

Why he thinks public blockchain technology has garnered so much attention. [0:11:27]

An explanation of the influence John Perry Barlow's vision had on cryptocurrencies. [0:13:04]

Learn what a Kleroterion is and the role it played in Athenian democracy. [0:14:01]

Professor Lehdonvirta shares what it means to 'trust in the code.' [0:17:05]

An outline of the new properties smart contracts created. [0:18:…
The Expected Returns of Financial Literacy (EP.217)

8 september 2022 · 1 uur 2 min
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What impact does financial literacy have on decision-making and financial outcomes? How is financial literacy tested? In this episode, we help listeners understand why financial literacy is vital in terms of financial well-being. Learn the definition of financial literacy, how financial literacy relates to economic outcomes, the differences between people who are financially literate and those that are not, and the contribution of financial knowledge to human capital. We discuss the topic through the perspective of several papers that will challenge how you think about financial literacy and the questions to ask yourself to test your financial understanding. Then, we talk about this week's book review regarding the effects of technology on communication and the various distractions associated with a traditional work environment. We also go through the various reviews received about the show and what we have planned for the Rational Reminder community. Lees meer

Key Points From This Episode:

Breakdown of changes made to the format of current and future episodes. [0:01:49]

Introduction to today's topic: expected returns of financial literacy. [0:07:34]

Learn the definition of financial literacy. [0:09:36]

The predictive power of financial literacy concerning financial outcomes. [0:10:27]

What financially literate people are better at and how it increases human capital. [0:11:34]

The cost of financial ignorance to the individual. [0:13:06]

Overview of an interesting paper concerning active investing. [0:14:43]

A dangerous observation within the financial literacy research [0:16:34]

Find out how financial literacy is measured. [0:20:10]

Whether it is safer to put your money into one business or to invest. [0:21:23]

An important aspect of financial literacy is discussed: inflation. [0:22:34]

Why numeracy is also a fundamental aspect of financial literacy. [0:24:25]

We go through the topic of compound interest in relation to financial literacy. [0:24:57]

Hear what t…
Understanding Crypto 14: Prof. John Cochrane: Money, (Fiscal) Inflation, and Political Freedom

2 september 2022 · 1 uur 44 min
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Welcome to our limited edition crypto series. In this episode, we welcome back Professor John Cochrane, who was a guest on the Rational Reminder series, to talk everything money. Professor Cochrane has immense experience on the topic and is a Senior Fellow at the Hoover Institution at Stanford, as well as Stanford Institute for Economic Policy Research. He is also a Research Associate of the National Bureau of Economic Research, an adjunct scholar at the Cato Institute, and was a professor of finance at the University of Chicago Booth School of Business. He is also the author of several books and writes a popular blog called The Grumpy Economist. In this episode, we take a deep dive into the concept of money. We learn what numeraire is, how a numeraire is defined, and explore some of the intricacies of money. We also discuss and unpack the differences between fiscal theory and monetary theory, along with other ideas regarding the value of money. We then delve into how all this relates to cryptocurrencies, what future he sees for crypto, and much more. Tuning into this episode, listeners will challenge their thinking about the economy and how economic relations work. Lees meer

Key Points From This Episode:

Professor John Cochrane explains to us the short version of fiscal theory. [0:04:35]

Find out the definition of numeraire and how it is determined within an economy. [0:05:21]

Learn whether government backing is required to define a numeraire. [0:07:05]

What Professor John Cochrane thinks is the primary function of money. [0:08:55]

Whether money needs to be a medium of exchange that stores value. [0:09:45]

He explains why money is valuable according to fiscal theory. [0:11:22]

The role of taxes in adding to the value of money according to fiscal theory. [0:12:59]

How fiscal theory's explanation for why money is valuable differs from the monetarist explanation. [0:13:33]

Find out whether the term 'fiat' is still a good adjective to describe money in a fiscal world.…
Gus Sauter: Vanguard's Former CIO on Indexing, Active Management, and Private Equity (EP.216)

1 september 2022 · 1 uur 22 min
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The indexing revolution is something that underpins all of our work here at the Rational Reminder and is a subject we reference in different ways in almost all of our episodes. Today we have a special exploration of this history, as we welcome Gus Sauter, the former long-time CIO of Vanguard, to talk about his incredible history at the firm, the role he played in the rise of the company, and its huge role in reforming the investing landscape. We also hear from our guest about his experience of working on numerous investing committees since he retired about a decade ago. One of the most notable things about this conversation is Gus' ability to weigh both sides of the arguments about active management, and he does a great job of balancing what he sees as the potential positives of this way of doing things. This is all strengthen by the way he presents these ideas as a powerful mix of stories, evidence, and the research he himself has conducted. To all our listeners, be sure to listen right to the end of the episode, as after the official conversation ends, Gus shared a few more thoughts on Jack Bogle and ETFs as a bonus. Lees meer

Key Points From This Episode:

(0:03:49) Looking back at the part that indexing played at Vanguard when Gus started at the company.

(0:04:20) The rise of indexing in the subsequent years and the pivotal moments in this process.

(0:06:28) Initial ways that indexing was denigrated by Vanguard's competition.

(0:08:36) How the narrative changed around indexing when its utility became undeniable.

(0:09:10) The role of the University of Chicago in the growth of indexing early on.

(0:11:11) Changes in the active management space over the last few decades.

(0:12:04) Considering the role of an active manager in today's climate.

(0:14:43) Gus' opinion on balancing the strengths of indexing and active management.

(0:20:48) Differences between traditional active management and factor investing, and Gus' preferences.

(0:29:09) A look at Vanguard's recen…
Understanding Crypto 13: Prof. William Magnuson: Blockchain and Democracy

26 augustus 2022 · 54 min
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Welcome to another episode from our limited edition crypto series. The previous guests we have spoken to about crypto generally have experience in economics, finance, or technology. In this episode, we have a look at crypto through a legal lens with Professor William Magnuson, an Associate Professor of Law at Texas A&M University School of Law. He is also the author of Blockchain Democracy, which provides readers with a guide into the world of blockchain and Bitcoin, and highlights the reasons for their growing popularity. In our conversation, we delve into everything law and order within the crypto world as Professor Magnuson explains the causes of crime, the jurisdiction of crypto, the impact of decentralized cryptocurrency on the legal system, and how to overcome the legal challenges surrounding crypto. We also talk about the underlying ideology of crypto, the origins of cypherpunks, the people who are being negatively affected by, mechanisms to enforce regulations, and much more. Tune in to learn more about crypto and blockchain through the lens of the law with Professor Magnuson! Key Points From This Episode: A brief overview of the political philosophies of Thomas Hobbes and John Locke. [0:02:48] Find out which of the two political philosophies is closer to reality. [0:04:55] What it means for political or economic systems to be decentralized. [0:05:26] An overview of the advantages and disadvantages of a decentralized system. [0:07:36] Causes of a decentralized system to become centralized. [0:09:54] Where power in an initially decentralized system tends to centralize. [0:11:38] The systems that democracies use to maintain a desired level of decentralization. [0:12:33] How close the underlying political philosophy of Bitcoin falls to the philosophies of Locke and Hobbes. [0:13:34] We learn about the origins of cypherpunks and the associated ideology. [0:14:55] Whether the current state of our world resembles the dystopian future that the cypherpunks imagined… Lees meer
Asynchronous Work & Effective Equity Duration (plus Reading Habits w/ Harley Finkelstein) (EP.215)

25 augustus 2022 · 1 uur 7 min
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We start the show with a brief highlight of recent episodes, upcoming guests, and feedback we have received about the show. We then review the book Running Remote, which provides evidence for the benefits of working remotely and asynchronous management. We also outline the three essential principles of an asynchronous mindset. We discuss the positives and benefits of remote work, why hybrid work is a flawed approach, and how to recreate face-to-face meetings in a remote world. We also give listeners a breakdown of an interesting journal article about inferring stock duration and equity trades, including key takeaways from the papers. We then welcome our special guest, Harley Finkelstein, to talk about the role that reading plays in his life. Harley is a lawyer, entrepreneur, and the President of Shopify and uses what he reads to push him further in his professional life. In our conversation, we learn the role reading has played in Shopify's culture, what his favourite books are, and inner details about his reading habit. Tune in for another jam-packed episode! Lees meer

Key Points From This Episode:

We start the show with a recap of previous episodes and upcoming guests. [0:00:00]

A brief highlight of some of the reviews we have received about the show. [0:03:41]

An update on the Rational Reminder 22 and 22 reading challenge. [0:06:35]

This week's review of the book, Running Remote. [0:09:24]

The three fundamental principles of the asynchronous mindset. [0:16:58]

Hear what the seven deadly sins are regarding remote team transitions. [0:24:35]

Cameron shares a compelling paragraph from the book, Running Remote. [0:28:04]

Learn a mind-blowing statistic Cameron read in a Bloomberg article. [0:32:31]

Ben breaks down a journal article about inferring stock duration. [0:33:47]

Another interesting paper regarding the retail price of equity trades. [0:44:10]

Introduction to our guest Harley Finkelstein to talk about our 22 and 22 challenge. [0:47:20]

Harley shares detai…
Understanding Crypto 12: David Gerard: Crypto Realities

19 augustus 2022 · 1 uur
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What is the real value of cryptocurrencies? Can crypto technology be applied to traditional financial markets? In this episode, we welcome David Gerard, a technologist and author of the books Libra Shrugged and Attack of the 50 Foot Blockchain. He uses his skills as a journalist to investigate the uses and hype around cryptocurrencies and is an outspoken skeptic of the technology. Although not originally from the technology sector, he has become an authority on the topic and has briefed the UK House of Commons Science and Technology Committee on the technology. He also runs a blog covering important aspects of the cryptocurrency space. In today's conversation, we learn some harsh realities about the benefits of cryptocurrencies and why they will not last in the long term. We learn what the real value of crypto-markets is, why he considers it to be a Ponzi scheme, what needs to change about cryptocurrencies, whether there are any benefits to the technology and the role of financial journalism in the crypto space. Listen as we unravel the political ideology which underpins crypto and whether it can be separated from the technology. We also discuss the outcome of El Salvador's bitcoin experiment and why it did not work. We also learn the reasons behind the recent crash in some crypto markets and find out which book David thinks everyone should read. Lees meer

Key Points From This Episode:

We start the show by finding out the real dollar value of crypto markets. [0:03:45]

The role financial journalism played in getting crypto to where it is today. [0:06:02]

Reasons why he does not trust the value of cryptocurrencies. [0:11:04]

Why he thinks cryptocurrency journalism is not credible. [0:12:00]

He explains Bitcoin's underlying political ideology and the associated problems. [0:13:25]

The classic debate of who should have control over financial markets. [0:16:41]

Whether it is possible to remove the political ideology from crypto-technology. [0:17:34]

What the most importa…
Jay Van Bavel: Shared Identities and Decision Making (EP.214)

18 augustus 2022 · 1 uur 12 min
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Identity helps shape our perception and thinking about the world around us. What is identity? How does it influence our perspective? These are some of the questions we answer in this episode of the Rational Reminder Podcast. In this episode, we talk with Jay Van Bavel, an Associate Professor of Psychology and Neuroscience at the University of New York, an affiliate at the Stern School of Business in Management and Organizations, and Director of the Social Identity and Morality Lab. He is also co-author of the book The Power of Us, which provides readers with cutting-edge research in psychology and neuroscience to explain how identity really works and how we can harness it for the better. His research focuses on how group identities, moral values, and political beliefs shape the mind, brain, and behaviour. He has published over 100 academic publications on the topic and has won various awards for his research achievements. In our conversation, we unpack the complexity of identity and its influence on our perspective and decision-making abilities. We cover aspects such as the differences between self-identity and group identity, how to be aware of your biases, the role that leaders play in influencing identity, and how identity plays out in social relationships. We also talk about how group identity interacts with democracy and the role of social media in shaping our identity, as well as learn some practical advice to help broaden your perspective. Lees meer

Key Points From This Episode:

We start the show by learning the basics of group identity. [0:03:29]

How group identity differs from self-identity. [0:04:04]

He explains how impactful group identity is to individual identity. [0:05:06]

Whether there is good data on how many groups people typically identify with. [0:06:08]

How aware people are of the groups they identify with. [0:07:27]

Ways in which group identity affects decision-making. [0:08:12]

The effect group identity has on setting and achieving goals. [0:09:…
Understanding Crypto 11: Quinn DuPont: Understanding Crypto: An Interdisciplinary Approach

12 augustus 2022 · 1 uur 33 min
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In this episode, we speak to Quinn DuPont, a self-described technology historian and researcher of everything crypto. He is fascinated by what humans do and how technology affects what humans do. Quinn focuses his research on the history, meaning, use, and socio-technical development of cryptography. He has published many academic papers on the subject, including the book Cryptocurrencies and Blockchains, and is currently an adjunct professor at the UBC School of Information. He approaches investigating the world of crypto as a scientist making him neither a skeptic nor a proponent of the technology, offering listeners an objective perspective. In this episode, we unpack the basics of crypto and take a deep dive into the theoretical and technological concepts. We learn about the ideological foundations of crypto, how crypto technology will impact governance, what the definition of money is, the potential of the technology to society, and the social components associated with cryptocurrencies. We also find out the real value of crypto and learn about the ethical challenges Quinn faces as a researcher in the space. Lees meer

Key Points From This Episode:

[0:05:16] The ideological worldview that resulted in cryptocurrencies.

[0:10:51] Quinn explains his standard criticism of the critics.

[0:13:43] Why the ideological origins of crypto are irrelevant today.

[0:15:50] The nuance surrounding the immutability of crypto technology is discussed.

[0:17:04] What the benefits of the cryptosystem are for governance.

[0:19:48] How well he thinks crypto fits within a democratic society.

[0:25:41] Reasons why political ideology needs to be taken into account.

[0:28:19] Quinn tells us his definition of money.

[0:31:18] What impact decentralized censorship-resistant monies have on society.

[0:38:52] How valuable a cryptocurrency in the real world is.

[0:40:48] Why paying your taxes gives money value.

[0:44:25] Whether Quinn considers Bitcoin to be money.

[0:46:09] He walks us th…
Expected Returns and Factor Investing (EP.213)

11 augustus 2022 · 1 uur 1 min
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In today's episode, we beg the question: is factor investing worth it? Factor-tilted portfolios tend to perform independently of the market and today, we break down a few of the characteristics associated with higher expected returns, as well as the challenges of factor investing. We give a brief history of pricing models and walk step-by-step through a hypothetical factor investment; taking the Fama and French five-factor model into account. Additionally, we discuss liability duration and bond returns and speculate whether pooling finances results in greater relationship satisfaction. Tune in to hear our take on everything from book clubs and the impact of inflation on consumption liability assumptions to our final verdict on whether factor investing is, in fact, worth your while. Lees meer

Key Points From This Episode:

The latest phenomenon of people paying to go on popular podcasts. [0:01:58]

Interesting feedback we've received for our Crypto series. [0:03:49]

Why not to make an investment decision based on one person's opinion. [0:04:53]

The evaluation skills our Crypto series equips listeners with. [0:06:05]

Upcoming guests on the Rational Reminder Podcast! [0:07:31]

Some interesting LinkedIn connections we've made in the past few weeks. [0:16:06]

Recommended book for kids: Way of the Warrior Kid 3. [0:18:11]

Recommended book for adults: The Psychology of Money. [0:21:08]

The model of our firm's book club and our experience of it so far. [0:22:02]

Does pooling finances result in greater relationship satisfaction? [0:24:35]

Liability duration and bond returns according to the current change in bond yields. [0:26:22]

How inflation impacts consumption liability assumptions. [0:29:11]

The positive effect the changes in the bond market have had on pension funds, relative to their liabilities. [0:30:20]

The main topic of the day: is factor investing worth it? [0:32:30]

The long-term volatility for factor-tilted portfolios. [0:33:56]

What factor investing is a…
Understanding Crypto 10: Prof. Hilary Allen: DeFi: Shadow Banking 2.0?

5 augustus 2022 · 48 min
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There is a lot of hype surrounding cryptocurrencies and DeFi technology, with excitement around the potential innovations they offer financial systems. Often lacking in the discussion is an objective and critically informed viewpoint, leading to confusion and misunderstanding. In today's conversation, we get the balanced perspective that we need with Professor Hilary Allen, who has a wealth of experience in banking, law, financial regulation, corporate finance, and business administration. She is a law professor at the American University of Washington College of Law and her research focuses on the impact of new financial technologies on the stability of the current finance system. She has written many academic papers on the subject, including the book Driverless Finance, which provides readers with a balanced perspective on the opportunities and threats of fintech innovations. In our candid and fascinating conversation with Professor Allen, we learn about the threats and opportunities DeFi technologies pose to the financial system. We hear what shadow banking is, the similarities that decentralized finance has with shadow banking, the risks of cryptocurrencies, if innovation in finance is always positive, why regulation is essential, whether DeFi is actually decentralized, the basics of stablecoins, how you can help affect change in the financial system, if you should invest in cryptocurrencies, and much more. Tune in to get the clarity you need about the world of crypto with expert Professor Hilary Allen! Lees meer

Key Points From This Episode:

We start the show by learning what shadow banking is and how it is associated with the financial crisis in 2008. [0:04:05]

Professor Allen explains what DeFi is and gives us some examples. [0:07:16]

Learn about some of the innovations that DeFi technology proposes. [0:09:21]

Similarities between shadow banking activities and DeFi technology. [0:11:06]

Other risks that Professor Allen sees with the DeFi system. [0:12:12]

What …
Prof. Ralph Koijen: Demand System Asset Pricing & Inelastic Markets (EP.212)

4 augustus 2022 · 1 uur 20 min
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If you're ready for a serious education on market elasticity, demand system pricing, and stock market flows, you've come to the right place (disclaimer: don't expect light entertainment). Today's guest is Ralph Koijen, AQR Capital Management Professor of Finance and Fama Faculty Fellow at the University of Chicago, Booth School of Business. Tune in for a fascinating conversation about some of the most fundamental characteristics of our economy. To say we learned a lot from this conversation is an understatement, and we're sure you'll walk away with just as many lightbulb moments and impactful lessons as we did. Lees meer

Key Points From This Episode:

Ralph provides an in-depth explanation of demand system pricing. [0:02:48]

An example of how valuations can be affected while the connection between fundamentals and valuations remain relatively unaffected. [0:08:18]

How Ralph's model for demand system asset pricing differs from other models. [0:41:26]

The two components that investor demand is made up of. [0:14:54]

Exploring the concept of latent demand and how to estimate it. [0:17:57]

How the price impact from institutions and elasticity of markets has changed over time. [0:20:34]

Understanding the surprising impact of households on stock market volatility in 2008. [0:20:34]

How latent demand can be used to predict differences in expected returns. [0:25:46]

Examples of factors that drive latent demand. [0:30:42]

The most impactful group of investors (and why this is the case). [0:33:17]

An overview of what would likely happen if the most influential investors switched to market cap indexing. [0:35:22]

How huge firms influence the setting of prices. [0:36:25]

Ralph shares his thoughts on the idea that index funds are distorting market prices as they continue to grow in magnitude. [0:35:22]

What demand system pricing tells us about the effect of socially responsible investing on prices. [0:43:01]

How US asset prices would be affected if foreign demand for US ass…
Understanding Crypto 9: Campbell R. Harvey: DeFi and the Future of Finance (Rebroadcast)

29 juli 2022 · 47 min
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For this week's episode, we are revisiting a portion of our conversation with the legendary Professor Campbell R. Harvey and and his more optimistic viewpoint on the crypto space. Campbell is the Professor of International Business at Duke University and is also a Research Associate at the National Bureau of Economic Research. In 2016 he served as the President of the American Finance Association, and from 2006 to 2012 he occupied the incredibly demanding role of Editor for the Journal of Finance. We hear about Campbell's latest book DeFi and the Future of Finance along with his most recent research. Discover how Campbell first became interested in the topic several years ago and decided to put together a course for his students. We also delve into the rise of decentralized finance (DeFi) and how we can expect it to shape global finance, trading, and the future of the internet. Lees meer
Stocks for the Long Run...? (plus Reading Habits w/ Mark Sutcliffe) (EP.211)

28 juli 2022 · 1 uur 9 min
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Welcome to another episode of the Rational Reminder Podcast! We start by reviewing The Fearless Organization, and learn some important concepts such as psychological safety in the workplace, allowing people to voice their concerns, and the value of continuously learning. We also discuss a paper on index investing followed by a quick discussion on gender equality in finance. We then take a deep dive into today's main topic, 'Stocks for the Long Run…?', by unpacking research to see if stocks are still a valuable long-term investment. Finally, we end the show with a conversation about our 22 and 22 book challenge with Mark Sutcliffe, and find out about his reading habits and the books that have had the biggest impact on him. Lees meer

Key Points From This Episode:

An update about the podcast and feedback received about the crypto series. [0:03:55]

A rundown of the guests we have planned for future episodes. [0:07:43]

Outline of the 'mixed-bag' reviews received about the show. [0:08:28]

News and updates regarding the Rational Reminder reading challenge. [0:13:07]

This week's book review of The Fearless Organization by Amy C. Edmondson. [0:14:45]

We talk about an interesting paper 'On Index Investing' [0:24:42]

Follow-up on and discussion concerning gender equality in finance from previous episodes. [0:28:34]

We dig into today's main topic, 'Stocks for the Long Run.' [0:33:38]

Issues surrounding using Stocks for the Long Run data to draw insights. [0:35:22]

What has been achieved to solve issues regarding a lack of data on stock returns. [0:41:45]

An important insight from research on the value of stocks and bonds in the long term. [0:47:17]

A breakdown of some interesting findings from the paper, 'Global factor premiums'. [0:48:00]

Overview of the research discussed and whether stocks are still valuable long-term investments. [0:53:54]

The Rational Reminder 22 and 22 book challenge conversation with Mark Sutcliffe. [0:55:09]

What Mark has discovered about the wor…
Understanding Crypto 8: Tim O'Reilly: How does Web3 Compare to Web 2.0?

22 juli 2022 · 52 min
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Welcome back to another comprehensive and informative episode in this limited series of the Rational Reminder Podcast, a weekly reality check about the world of cryptocurrencies. We are lucky to have another respected figure in the crypto world on our show, technology veteran Tim O'Reilly. Tim is a well-known educator and publisher in the crypto community and the Founder, CEO, and Chairman of O'Reilly Media. He has been involved in the technology industry since the inception and rise of Silicon Valley and, with over 35 years of industry experience, he is known for popularizing the terms 'open-source software' and 'Web 2.0' and is a respected commentator on the space. In today's show, we do a lot of looking backwards with Tim and draw insight from his vast experience in the industry to discuss what the future of cryptocurrencies holds. We also talk about what separates companies that survive from those that do not, problems in society that blockchain technology can be used for, and changes that have taken place in the technology industry during Tim's career, as well as what the definition of true innovation is, and much more. Lees meer

Key Points From This Episode:

What Tim's definition of a technology unicorn is. [0:03:07]

The problems that Web3 could solve and what makes a product innovative. [0:04:39]

Differences between companies that survived the .com bust and those that did not. [0:11:05]

Whether Tim thinks there are promising projects in the crypto or Web3 space. [0:18:36]

How society would change if Web3 became the new normal. [0:22:19]

Examples of the applications blockchain technology could have for record-keeping. [0:24:36]

Tim shares his thought son whether or not we need blockchain technology for aspects where the state is involved. [0:27:24]

Ways in which the evolution of crypto has changed Tim's mental map of the future. [0:31:37]

The role public blockchains could play in breaking the recentralization trend in decentralized technologies. [0:35:02]

Ti…
Prof. Ludovic Phalippou: Private Equity, Under the Hood (EP.210)

21 juli 2022 · 56 min
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If you have any interest in private equity or have thought about it as an asset class, then this episode is for you! What is private equity? This might seem a simple question but the answer is more complex than you think. Private equity is a nuanced subject that requires a deep understanding to make successful investments. To help unpack this non-trivial subject is expert Ludovic Phalippou, a Professor of Financial Economics at the University of Oxford Saïd Business School. Although he studied economics in general, his research mainly focuses on unravelling the complexities of private equity. He has written many papers on the topic, including a book called Private Equity Laid Bare. He has a Masters in Economics and a Masters in Mathematical Finance from the University of Southern California and a Ph.D. in Finance from INSEAD, making him well versed in the subject. Besides his impressive qualifications and experience, his insight and ability to speak to the data make him stand out from other experts. In our conversation, we get into the basics of private equity and what makes it attractive to investors. During our conversation we discuss the challenges for measuring performance, how to best measure the performance of private equity funds, the different facets associated with private equity, how to tell if certain private equities are a good investment, and the differences between private and public equity. We also hear how it is applied as he walks us through some real-world scenarios and gives us some insider knowledge on the best private equity options. As you will hear from our conversation, there is no easy answer! Lees meer

Key Points From This Episode:

We learn what asset classes are included in the broad term of private equity. [0:03:39]

The end-to-end process for investing in a typical private equity fund. [0:06:49]

The challenges with measuring the performance of private equity managers. [0:09:48]

How investments that have not yet been sold are treated when a ma…
Understanding Crypto 7: Nicholas Weaver: A Computer Scientist's Perspective on Cryptocurrencies and Blockchain

15 juli 2022 · 1 uur 9 min
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Dr. Nicholas Weaver's well-known lectures on cryptocurrencies explain why he believes it needs to be "burned with fire." Today, we speak to Dr. Weaver, an expert in computer science and a long-time observer of the cryptocurrency space. He holds a BA in Astrophysics and Computer Science and a Ph.D. in Computer Science from UC Berkeley, where he was also a lecturer until recently. His primary research focus has been network security, among other topics. His interest and search for comedy "godl" have also resulted in published papers on cryptocurrency. In our conversation, Dr. Weaver untangles the complexities of the perceptions of cryptocurrencies with the actual technology. We talk about decentralization, if cryptocurrencies are achieving it, and the underlying concept of blockchain technology, as well as whether or not blockchains are secure and what the potential benefits of cryptocurrencies are to developing countries. We then go into detail about why Dr. Weaver thinks the crypto space is not beneficial, why prestigious academic institutions are teaching about it, and why he thinks it will never work in the log-run. Please tune in for a truly eye-opening, no-holds-barred episode as we learn the harsh truth about cryptocurrencies with expert, Dr. Nicholas Weaver! Lees meer

Key Points From This Episode:

What public blockchain technology can achieve that was not previously possible. [0:02:51]

How well the original concept, introduced by Satoshi Nakamoto, is living up to its theoretical promise. [0:04:06]

Weaver explains and outlines the general appeal of decentralization. [0:04:57]

He elaborates on his perspective on trusted and honest authorities. [0:09:39]

An explanation of how Lightning Network attempts to solve throughput limitation. [0:10:36]

We find out if major blockchains like Bitcoin and Ethereum are decentralized. [0:13:08]

Differences between how nodes and miners influence the network. [0:16:23]

How secure public blockchains really are. [0:17:45]

Whether …
Optimal Allocations to Owned Housing & Gender Equality in Financial Planning (EP.209)

14 juli 2022 · 55 min
Afspelen

Welcome to another episode of the Rational Reminder Podcast! In today's jam-packed episode, we start by going through the feedback received on our limited crypto series and outline upcoming guests. We also give a breakdown of Cal Newport's book, Deep Work, and the importance and long-term benefits of engaging in deep work. We then follow-up on our recent episode with Rebecca Walker by discussing gender equality in financial planning. Lastly, tune in to also have a rundown of the housing market and its investment potential, price risks associated with home ownership, the effects homeowner's occupation has on their household investment and more! Lees meer

Key Points From This Episode:

We go through feedback received on the limited edition crypto series. [0:01:40]

An outline of the upcoming guests we are going to have on the show. [0:05:51]

This week's book review, Deep Work written by Cal Newport. [0:09:01]

Some of the common workplace problems highlighted in the book. [0:14:30]

How work can be more enjoyable than free time and reasons why. [0:15:56]

Ways to overcome common workplace problems and engage with 'deep work.' [0:16:47]

The long-term benefits of engaging with deep work and why it is needed. [0:20:21]

A follow-up on our recent episode with Rebecca Walker and the feedback received. [0:20:49]

Discussion about the data that is related to Rebecca's points from the episode. [0:22:10]

We unravel the nuance concerning the gender pay gap and financial planning. [0:26:10]

An important takeaway concerning our discussion on the gender pay gap. [0:33:19]

Rundown of the housing market and its investment potential. [0:33:58]

Find out how an owned home can act like an investment. [0:37:42]

Learn more about 'Portfolio Theory' concerning property investment. [0:40:50]

An interesting aspect regarding peoples' occupation and property investments. [0:46:18]

How people reduce the risk associated with property investments. [0:47:45]
Understanding Crypto 6: Bruce Schneier: Security, Trust, and Blockchain

8 juli 2022 · 55 min
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Welcome back to another episode of our limited addition Crypto Series on the Rational Reminder Podcast, a weekly reality check about sensible investing and financial decision-making. Are cryptocurrencies and the associated technologies beneficial? Could they change the world for the better? There is a lot of controversy surrounding the use and application of cryptocurrencies and the associated technologies. Some say the innovation is ultimately useless while others think it is the answer to society's problems. To help us unpack this complicated and hot-button topic is Bruce Schneier, an internationally-renowned security technologist, author, and educator. The focus of his work is the intersection of security, technology and people. Bruce also has an immense passion for educating people about cryptocurrencies. Examples of his well-known books include Liars and Outliers and Data and Goliath, which provide much-needed insight to readers about DeFi technologies and big monopolies. He also lectures in public policy at the Harvard Kennedy School and is a fellow at the Berkman Klein Center for Internet and Society. In our conversation, we discuss the debate surrounding cryptocurrencies such as privacy concerns of digital cash, what makes Bitcoin different from earlier digital currencies, aspects of public blockchain technology, the misapplications of crypto technology, the different forms and approaches to cryptocurrencies, and whether DeFi technologies can be beneficial to society, and what the biggest concerns are regarding cryptocurrencies. Join us today as we take a detailed look into the value and drawbacks of crypto and DeFi technology with Bruce Schneier! Lees meer

Key Points From This Episode:

What the objective was of early digital cash projects, like DigiCash. [0:03:27]

The privacy concerns associated with digital cash. [0:04:45]

Whether financial surveillance should be a concern for people. [0:05:45]

Differences between Bitcoin and earlier forms of digital cash. [0:…
Rebecca Walker: Women Talk Money (EP.208)

7 juli 2022 · 39 min
Afspelen

There's no doubt about it; money is a taboo topic in our society. But not talking about money only serves to uphold inequalities and injustices. Rebecca Walker is an advocate for transparency and, during this episode of the Rational Reminder Podcast, she shares the importance of exploring the factors that have influenced our relationship with money so that we can begin to understand how we can use money as a tool to effect the kind of changes we want to see in the world. This is the intention behind her latest collection, Women Talk Money. No matter your gender, race, or financial standing, this episode will provide you with a new perspective on how to approach money. Rebecca is a well-known speaker, author, consultant and was named by Time Magazine as one of the most influential leaders of her generation. Tune in today. Lees meer

Key Points From This Episode:

What money represents and why it is so important that we understand it better. [0:02:21]

The intention behind Rebecca's latest collection, Women Talk Money. [0:03:05]

A brief overview of some of the stories Rebecca shares in her book about our relationship with money and how it impacts our lives and society as a whole. [0:05:13]

How race, class, and gender impact how knowledge about money is transferred. [0:08:50]

Problems that arise when we aren't transparent about our finances. [0:11:22]

How the way we approach money ties into many broader societal issues. [0:15:45]

Examples of how not talking about money renders people powerless. [0:17:45]

Rebecca explains how she has taught her son about money from a young age. [0:20:58]

Rebecca's approach to talking to other people about money. [0:22:30]

Issues that may stem from an obsession with money. [0:24:32]

How Rebecca defines "enough." [0:27:09]

The role that men can play in empowering women in relation to money. [0:29:24]

Advice for women who are struggling to form a healthy relationship with money. [0:33:33]

How Rebecca defines success in her own life. [0:…
Understanding Crypto 5: Stephen Diehl: The Case Against Crypto

1 juli 2022 · 54 min
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Welcome back to another limited series of Rational Reminder Podcast, focused on learning about cryptocurrencies. Our journey about cryptocurrencies has led us to speak to various experts on the subject, all of whom see some benefits to cryptocurrencies and the underlying blockchain technology. However, what does a skeptic think about cryptocurrencies and the benefits to the current financial system? In today's episode, we speak to Stephen Diehl, a software engineer who works with financial technology within the finance sector and is an outspoken cryptocurrency skeptic. His engineering background, coupled with his experience working with financial technology, provides a unique perspective on the future of cryptocurrencies. We move through the episode learning about public blockchain technology, different consensus mechanisms, what potential problems blockchain technology can solve, whether crypto can improve the current financial system, if Bitcoin really is decentralized, what drives crypto prices, reasons why crypto will not work, what makes it similar to gambling, and more. Tune in today to hear a unique opposing view of cryptocurrencies and DeFi technology with expert and skeptic, Stephen Diehl! Lees meer

Key Points From This Episode:

A brief breakdown of public blockchain technology. [0:03:28]

The current problems that public blockchain technology is trying to solve. [0:04:16]

Proof of work consensus and how it tries to eliminate the need for a trusted third party. [0:05:44]

Some of the downsides associated with the proof of work concept. [0:07:41]

How other consensus mechanisms have improved the proof of work concept. [0:09:21]

What the costs associated with proof of stake relative to proof of work are. [0:11:09]

Problems that both consensus methods have regarding recentralization. [0:12:07]

What other problems blockchain technologies can be used to solve. [0:12:50]

The problems in the financial technological system that public blockchains solve. [0:14:29]

Wh…
What is Money? (plus Reading Habits w/ Dan Solin) (EP.207)

30 juni 2022 · 1 uur 16 min
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In today's episode, we share some updates from our Financial Goals Survey, respond to a listener who says we are wrong about dividends, and talk about Scout Mindset by Julia Galef. We then respond to a listener question about whether our comments in Episode 205 on private equity extend to private real estate. In our main topic, we unravel what money is by looking back at its origin story and the two competing theories about what it is. We discuss the ideological underpinnings of money and how these ideologies can make choosing a definition of money highly political. We end the episode talking to Dan Solin about his reading habits. Dan Solin joined us almost four years ago for an episode on evidence-based investing. Tuning in, you'll hear how Dan finds the books he reads, what his favourite types of books are, and whether he recommends books to people, plus he shares why he believes reading is so essential, and much more. Don't miss out on another well-rounded and informative episode of the Rational Reminder Podcast. Lees meer

Key Points From This Episode:

An update on the progress of our Financial Goals Survey. [0:03:32]

Your monthly update on the reading challenge and how to get involved. [0:04:52]

An update from our limited crypto series and some of the feedback we've received. [0:08:00]

This week's book review: The Scout Mindset. [0:16:29]

Simple set of tools to help you assess biases when receiving new information. [0:19:18]

Following up on private investments concerning real estate. [0:24:32]

Onto the main topic of the show with Dan Solin: money and what it is. [0:29:09]

Where the perception and definition of money originated from. [0:31:00]

Unpacking an alternative definition of money by Adam Smith. [0:37:32]

The quantity theory of money and its application in the economy. [0:40:14]

An interesting political aspect to forming John Locke's theory of money. [0:46:49]

Outlining of the history of opposing views on the theory of money. [0:47:25]

A break down of…
Understanding Crypto 4: Prof. Tobin Hanspal: The Characteristics of Crypto Investors

24 juni 2022 · 47 min
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Welcome to another special episode of Rational Reminder Podcast, a show to help us learn about cryptocurrencies and their role in our current and future financial systems. In today's show, we speak to Tobin Hanspal, an Assistant Professor of Finance at the Vienna University of Economics and Business who has written several papers focused on household finances. Tobin's research area offers insights into the behaviours of retail investors in the crypto space and how this may affect household finances. In this episode, we take a deep dive into some of the papers that Tobin has authored and how his findings relate to the behaviours and biases of crypto adopters. We discuss the investment behaviours of early crypto adopters, the role of EFTs in reducing risk, the different types of investor groups, how past experience negatively affects investor confidence, how behaviours change after an initial crypto investment, the disposition effect, how cryptocurrencies are an extension of existing behaviours, and much more! Be sure not to miss out on this informative episode with expert, Tobin Hanspal! Lees meer

Key Points From This Episode:

How Tobin investigated the investment behaviour of early crypto adopters. [0:04:24]

Whether indirect crypto investments are a good proxy for crypto investors. [0:08:10]

Why it is important to consider the different types of investor groups. [0:10:23]

The differences between individual characteristics of crypto adopters and non-adopters. [0:10:55]

Comparison of eventual crypto adopters and non-adopters [0:12:37]

What kind of sector ETFs do crypto adopters choose to invest in. [0:13:48]

Differences between the crypto and non-crypto investors, in terms of typical investor behaviour biases. [0:15:01]

How cryptocurrencies are an extension of traditional high-risk investing. [0:16:39]

Whether the behaviour of investors changes after their first crypto investment. [0:17:37]

The differences in behaviour between early and late adopters. [0:19:15]

Wha…
Prof. Vanessa Bohns: You Have More Influence Than You Think (EP.206)

23 juni 2022 · 1 uur 10 min
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Welcome back to another exciting and informative episode of the Rational Reminder Podcast, a show all about finances and how to get the most of your money responsibly. To make the right decisions regarding your investments, besides the knowledge and understanding of financial systems, you also need to understand the psychology behind your decisions. To help us unpack this complicated and interesting subject is Professor Vanessa Bohns, a Social Psychologist and Professor of Organizational Behaviour at Cornell University. Professor Bohns has a Ph.D. in Psychology from Columbia and is the author of You Have More Influence Than You Think: How We Underestimate Our Power of Persuasion, and Why It Matters. The topic of the book is exactly what today's show is about, as we delve into the intricacies of human behaviour and decision-making. In today's episode, we learn about the influence that people have on one another, how people perceive one another, the human behaviours that scammers take advantage of, why people worry about saying the wrong thing, what the default behaviour of people is, why people struggle to say no to a request, and so much more! Don't miss out on this fascinating episode with special guest and expert, Professor Vanessa Bohns! Lees meer

Key Points From This Episode:

How much impact and influence people have on one another. [0:03:09]

What people tend to notice about other people. [0:04:50]

Why people don't realize what other people are paying attention to. [0:08:58]

How being in the presence of other people affects experiences. [0:10:31]

Whether communicating with someone about a shared experience amplifies it. [0:12:41]

Reasons why some people are underconfident in their social lives. [0:13:20]

Problems that stem from underconfidence. [0:15:52]

The consequences of underestimating how much people like us. [0:18:02]

Why people worry about saying the wrong thing. [0:20:53]

Whether it is default to believe or disbelieve when assessing information. [0:22:…
Understanding Crypto 3: Eswar Prasad: Bitcoin, Banking, and the Future of Money

17 juni 2022 · 48 min
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Welcome back to another episode of our series focusing on cryptocurrencies. In this episode, we dive into conceptual complexities surrounding cryptocurrencies and how this might affect the financial system in future. To help us unravel this nuanced subject is Professor Eswar Prasad, a senior professor of trade policy and Professor of Economics at Cornell University, and a senior fellow at Brookings Institution. He is also a research associate at the National Bureau of Economic Research and was a former head of the IMF China Division. Besides his wealth of experience regarding traditional economies, he is also an authority on cryptocurrencies, which he explains in detail in his book The Future of Money: How the Digital Revolution Is Transforming Currencies and Finance. In today's conversation, we discuss broad conceptual ideas surrounding money and finance, such as the basic functions of money, the difference between outside and inside money, the limitations on creating wealth, how cryptocurrencies work, how cryptocurrencies may disrupt financial systems, why cryptocurrencies need trust to work, the future of cryptocurrencies, and much more. Tune in today to get insider information on cryptocurrencies with our special guest, Professor Eswar Prasad. Lees meer

Key Points From This Episode:

A brief outline of Professor Eswar Prasad's professional background. [0:01:14]

Professor Prasad explains what the basic functions of money are. [0:01:59]

We learn if money is a commodity or a social contract. [0:02:33]

The problems associated with fiat currencies. [0:03:00]

What the concepts of inside and outside money are. [0:04:12]

Factors that constrain the creation of outside money. [0:05:34]

Whether mechanically constrained money is good for economies. [0:07:07]

Learn whether commercial banks need deposits to make loans. [0:08:46]

What the definition of fungibility is. [0:10:24]

How and why reserves are usually maintained by a central bank. [0:11:19]

What the differences are …
Tech vs. Value, and Private Equity vs. Public Equity (EP.205)

16 juni 2022 · 1 uur
Afspelen

Welcome to another episode of the Rational Reminder Podcast. In today's jam-packed episode, hear updates regarding our goals survey, the schedule for upcoming guests on the show, the latest news and highlights from the financial world, and some of the feedback we have received about the show. We also highlight interesting articles and papers regarding tech valuations, expected stock returns, the performance of venture capital funds, and a book recommendation that will help you understand the finance game. Tune in to learn about the results of the recent social survey in Canada, the basics of private equity funds, the challenges of calculating the Internal Rate of Returns for investors, some of the misconceptions surrounding private equity, and much more! Don't miss out on this informative and well-rounded episode of the Rational Reminder Podcast with your two favourite Canadians! Lees meer

Key Points From This Episode:

We start the show with an exciting announcement for our listeners. [0:02:07]

An update regarding the Goals Survey Project and what needs to be done. [0:03:30]

A rundown of the upcoming guests for the show. [0:04:44]

Outline of the reviews and criticisms received about the show. [0:05:55]

A breakdown of the book for today's review, Finite and Infinite Games. [0:10:07]

Background about the author of the book, James P. Carse. [0:10:57]

The main point of the book: the differences between finite and infinite games. [0:11:16]

An interesting quote from the book regarding culture. [0:14:42]

Highlights of the recent news and updates in the financial world. [0:17:02]

Insights from an interesting article about tech valuations by Cliff Asness. [0:19:47]

Another interesting paper by David Blitz about expected stock returns. [0:23:09]

A discussion regarding the recent social survey implemented in Canada. [0:26:07]

We discuss the basics of private equity as an investment strategy. [0:30:06]

Why the math used is problematic for calculating the Internal Rate of …
Understanding Crypto 2: Igor Makarov: Economics of the Crypto Ecosystem

10 juni 2022 · 1 uur 27 min
Afspelen

Understanding the complexity surrounding cryptocurrencies is essential in making the correct decisions regarding investing in DeFi technology. To help us understand the basics, we talked to Dr. Igor Makarov who is an expert on cryptocurrency and Bitcoin, particularly Bitcoin and the associated mining processes. He is based at the London School of Economics, where he serves as an Associate Professor of Finance. Dr. Makarov is also the author of several papers focusing on DeFi and crypto markets in general and has provided new insights surrounding governance and mining processes. In today's show, we learn about the basics of cryptocurrencies, mining and the future of DeFi. In particular, we talk about the role of intermediaries, what drives the prices of Bitcoin, how concentrated mining processes are, the role DeFi in increasing governance, the upsides and downsides of cryptocurrencies, and much more. Tune in to make sure you don't miss out on advice from a respected figure in the industry, Dr. Igor Makarov! Lees meer

Key Points From This Episode:

A brief outline of Dr. Makarov's professional background and experience. [0:00:39]

What role do intermediaries play in the traditional financial system. [0:02:36]

Find out if economic rents that intermediaries collect are unwarranted. [0:03:36]

Makarov explains the complexities of cryptocurrencies and the elimination of fees. [0:06:06]

How rents are different on cryptocurrency exchanges. [0:09:44]

Systemic risks associated with the traditional banking system. [0:11:24]

Whether Bitcoin and DeFi can improve banking by reducing systemic risk. [0:13:22]

Learn if blockchain or DeFi ecosystems can exist without human intervention. [0:15:06]

Why it is unlikely decentralized autonomous organizations will improve governance. [0:17:06]

Breakdown of the potential problems that concentration of ownership could have on governance. [0:19:53]

Opportunities where cryptocurrencies and DeFi can improve the traditional financial system. [0:…
John A. List: Improving the World with Economics (EP.204)

9 juni 2022 · 1 uur 40 min
Afspelen

John List is the recently appointed Chief Economist at Walmart, and is also a Professor of Economics at the University of Chicago, having worked as the Chief Economist at Uber and Lyft. He has published a huge array of important papers in the field of economics and is also the author of the recent book The Voltage Effect, which deals with the question of how to scale ideas successfully. We are very excited to bring you this episode, which is a particularly illuminating one, in which we draw on John's treasure trove of insight and experience, to answer a long list of questions related to personal finance decision-making. A large portion of our chat focuses on the central ideas of critical thinking and fieldwork, practices that our guest views as indispensable in making the world a better place. Along the way we get John's thoughts on retirement planning, public policy, charitable donations, and much more, so make sure to press play on this fantastic episode of the Rational Reminder Podcast. Lees meer

Key Points From This Episode:

John explains the importance of fieldwork in the study of economics. [0:03:51]

Examples of field experiments that overturned a supposed economic truth. [0:05:15]

Finding ways to test theories that previously proved difficult. [0:08:30]

The question of generalizing findings from an experiment to a wider rule. [0:13:30]

Replication in academic studies; John unpacks its central importance. [0:20:46]

Why positive results tend to garner a publication bias. [0:23:38]

John's perspective on checking in on investment portfolios. [0:24:40]

What the data shows us about investment behaviours of men and women. [0:28:38]

Accounting for the drive to give to charity. [0:35:20]

Advice for how to make the most of your donations. [0:39:42]

John unpacks his findings on scaling, its importance, and what he calls 'the voltage effect'. [0:44:41]

The impact of technological advancement on our ability to scale certain solutions. [0:48:27]

How field experiments …
Understanding Crypto 1: Daniel Mescheder: What Problem Do Blockchains Actually Solve?

3 juni 2022 · 1 uur 12 min
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Fundamentals of the Blockchain with Daniel Mescheder Lees meer

Episode 1: Show Notes

Welcome to the first episode of our limited series focusing on cryptocurrencies and everything you need to know about them. Our first guest is Daniel Mescheder, who joins us to appropriately break down some of the basic concepts and engineering of the blockchain, using his expertise as a software engineer as the lens for this discussion. We felt this chat was the best way to launch the series and prepare listeners for the following episodes on the subject, and you can expect to hear Daniel share very helpful insight and explanations of fundamental terms and concepts such as distributed systems, consensus, hashing, digital signatures, and more. We also have time for our guest to weigh in on the subjects of smart contracts and NFTs, both of which are regular points of intrigue for the uninitiated. Importantly, we do hear from Daniel about the limitations of the technology at present, and which types of technological problems that he believes the blockchain is well-suited to address. So for all this and more, and to start this journey with us into such an important and hot topic, make sure to listen in.

Key Points From This Episode:

The reasons for Daniel's interest and involvement with the blockchain and cryptocurrencies. [0:03:33]

Daniel compares the hype around AI in the 1980s and the current atmosphere for crypto. [0:04:50]

Getting to grips with Daniel's specific perspective on the blockchain and explaining distributed systems. [0:06:34]

How the concept of consensus fits into the subject of distributed systems. [0:11:17]

Looking at Byzantine consensus problems and how these occur on the blockchain. [0:13:51]

Daniel gives an overview of the elements that make the blockchain functional; hashing and digital signatures. [0:19:17]

How Satoshi Nakamoto introduced an economic incentive to comply with the protocol. [0:24:09]

Differentiating between the public and permissioned blockchains…

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