The "Rule Breaker Investing" Podcast Looks Back at the Best of 2021

Oscars, Emmys, Grammys, Tonys...and, of course, Besties. That's right, it's time to roll out the red carpet and bring back the best of 2021 here on the Rule Breaker Investing podcast. 

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This video was recorded on Dec. 15, 2021.

David Gardner: This year has been one for the ages, frequently contrary to expectations, sometimes to all expectations. Sadness, surprises, a lot of growth, transformations, new chapters, what a year. I'm only just talking about this podcast. While movies have their Oscars, television has its Emmys, music has its Grammys, and Broadway it's Tonys. Podcasts have, I'm not really sure what podcast have, but the one podcast I know best anyway, this podcast, has its Besties. You deserve it, we deserve it and all the stars are back. Looking back at this year's work together, looking ahead to 2022, all tied up in a bow for you. Only on this week's Rule Breaker Investing.

Welcome back to this possibly the most special edition of Rule Breaker Investing this year. Cameos for many of my best guests this year, reflecting back and looking forward, it's our Besties of 2021. I've identified 10 of my favorite podcasts that we brought to you this year. These are not ordered. These are not ranked in any way, shape, or form. But looking back and thinking through the roster of the 50 podcasts we've done so far this year, I thought, what are 10 that stand out to me. Probably to you but to me, anyway, and why not talk briefly about them and when possible, have some voices return to share some reflections both about the year that was and the year that will be. Now, again, these are not ranked and I should mention of the 40 podcasts that are not even included here, while I wouldn't want anybody to think that I didn't think they were really great too. I love all my children. We have an author from August that I'm bringing in this week, but that doesn't mean that the other authors in August weren't each spectacular because they were. 

But you can only fit so much in the Besties of 2021 and just like the Oscars and Emmys and Grammys and Tonys, in the end, you have to pick only one. Well, here are only 10. A big reason for doing the Besties every year is to encourage you, if you didn't hear any of these 10 podcasts, in fact, to go back and listen. Some of you listen every week, so you will enjoy remembering with me since I'm here every week too, that great podcast from May or from February you forgot about. It's even better when we have that great guest back to talk to you again here this week, which we do. But for a lot of us, we're new, we didn't get to hear that one in February or January of this year. This is a great opportunity for you to flag one you may want to go back and listen to because these are, in some cases, seminal, mostly original, and all of them are Besties. Now, before I get started, I want to mention next week's podcast and that's the Market Cap Game Show.

I'm excited to be welcoming the Brians back for the second game in a row, especially since they tied last time, epic ending in September. So Brian Feroldi and Brian Stoffel are back to bring you some Foolishness and a lot of holiday cheers. So get the wood in the fireplace, invite the family in, time for warm cider, traditional or hard, and light it up with us next week with the Market Cap Game Show Holiday Edition to help you close out the year. With the market having sold off pretty stiffly over the past month or so, the market caps, they aren't changing. So with Brian and Brian, you get to play along too next week. That's the second last podcast of this year. But let me, in particular, also mention our last podcast of this year, which is of course our Mailbag. The reason I'm underlining that is because we're recording both of those podcasts I just mentioned early next week. 

That way, Rick and I can enjoy our holidays and you can too, knowing that we're bringing you awesome new podcasts to close the year, both fresh, but we're doing them ahead of time, so that we have extra time with our family. Thus, if you would like to be featured on the Year End Mailbag, you need to write to us right away. We're recording that this coming Monday afternoon, so we'll need to hear from you right now or right after finishing this week's podcast or Friday at the latest. If you're interested, the email address is [email protected]. [email protected] is the email address. Of course, you can also tweet us @rbipodcast on Twitter. To summarize, next week, the Market Cap Game Show, the week after, the Year End Mailbag. But we need to hear from you right away if you'd like to be considered for the Mailbag. Now, ladies, gentlemen, and Fools everywhere, the red carpet has been rolled out. You are invited and we welcome you to this year's Rule Breaker Investing podcast Besties. Complete this year with our own theme music chosen specially by my producer, Rick.

All right. Well, Bestie number 1 this year, and in fact, of these 10, it is the one I did earliest in the year. The date was simply January 13th, 2021. It was the second podcast of the year. The first podcast traditionally has been my biggest losers each year. So I just come off talking about my worst stock picks from the week before, and it was time for six principles of a Rule Breaker portfolio. Now, the intent of that podcast was to provide you a portfolio level framework as a fellow Rule Breaker principles you can use to manage your Rule Breaker portfolio. Certainly, over the years, starting with from a few decades ago, six traits of Rule Breaker stocks. That's my original group of six and what we've used for a couple of decades now many of us too help make better selections for our portfolios. Then a few years ago on this podcast, I debuted six habits of the Rule Breaker Investor because after all, it's not enough just to find good stocks. 

If you're not behaving well with them, if you don't know how to do it right, then those six traits of Rule Breaker stocks might not suit you very well, might not serve you very well. So I felt that incumbent upon me to think through with you on this podcast a few years ago, six habits of the Rule Breaker Investor. But that wasn't enough. I decided earlier this year, we needed some portfolio management principles to put in place. I think it was a very significant podcast that makes up my investing triumvirate now of my list of six principles. I'm not going to go back over these now, but I will remind you of a couple of these portfolio principles. One of them for Rule Breakers is fair starting line. That's just a reminder that when you start a portfolio, I think the smartest thing you can do is equally allocate to all of your initial stock picks. Don't load up on one and give short shrift to a few others fair starting line. Another one I certainly remember, I hope you do too for those who are listening, know your sleep number, which I define as the percentage of your portfolio that you are willing to put in your largest single holding and still sleep at night. 

For example, if you would never want more than 10 percent of your portfolio in any one stock, your sleep number is 10. Know your sleep number. That podcast is replete with a lot of considerations around managing your portfolio, and so that's why it gets a Bestie here for 2021. It was probably my most significant new invention of the year. I like to invent things. I came up with spiffy-pops, I made up risk ratings. I've embedded key lines or concepts like dark clouds we can see through. For me, the act of thinking through being an investor and an entrepreneur and really a fellow liver of life is to be creative, to invent things. Standing up six principles of a Rule Breaker Portfolio, all part of a greater rule-breaking framework, well, that is a Bestie for 2021. Speaking of inventions, another of the principles I will just mention this in closing, is one of those lines that I've invented. Another invention, something that means a lot to me. It might be on my gravestone one day, make your portfolio reflect your best vision for our future. 

That is another invention and that is indeed part of the six principles of a Rule Breaker portfolio. So Bestie number 1, six principles of a Rule Breaker portfolio. A reminder for many of us, we heard that one, but you might want to go back and listen again, especially I made a lot of market sell-off where people start sometimes to lose sense of their principles or compromise the initial thoughts they had when they started something. That could be very helpful, especially for new investors. But then speaking of new, we have a lot of new listeners over the course of 2021. Part of the reason, as I mentioned earlier, for besties, is to encourage you to go back and listen to the key podcast if you didn't hear them in the first place. The second Bestie of 2021 goes to Two Fools. Indianapolis Colts' Head Coach, Frank Reich. It was originally published on July 14th of this year, my wedding anniversary. I'm thinking now in retrospect, that's great. What was the intent of this podcast? 

The intent was to share an incredible life story. Frank Reich's own story, raised in modest circumstances in the State of Pennsylvania, coming to some prominence as a football quarterback, both at the collegiate level and then later at the NFL level, although a lifetime backup quarterback which had its own amazing dynamics to it. Today, a head coach in the NFL, but Frank's incredible life story connects directly into Foolishness as he switches onto investing and starts topping around fool.com around 10 years ago. To catch up with them 10 years later and hear from somebody the story of his life in 10 sentences or left, the stock graph of his life, the three key moments that made Frank Reich the investor he is today. To connect that life into Foolishness was I thought, a really special dynamic. I love seeing someone who's such a high achiever in one area, in this case, sports focus his sights on investing too. 

Turns out, you can be great at more than one thing. Why was this a Bestie? This might have been my favorite podcast we did all year and increasingly I have a sense that Foolishness. That is what The Motley Fool has been trying to teach the world now for 29 years and counting. I just have this feeling that increasingly, we're hitting the main stream. When we have an NFL head coach on talking about his own investing journey as a fellow Fool, how could I not think Bestie, you bet you, Two Fools Indianapolis Colts' Head Coach Frank Reich. Part of the reason I love doing this Besties podcast every year, is we get to revisit them with some of my favorite people. I'm really happy to announce among a bevy of cameos and guest stars for this year end extravaganza, Frank Reich is the first one. Frank, welcome back to Rule Breaker Investing. A delight to have you with us this week.

Frank Reich: My pleasure, David. Glad to be back on the show during the middle of the football season.

David Gardner: Yeah. I know it's special that we're getting this time with you. I know you're just coming off of a bye week, so maybe you had a little extra time. I hope you did some R&R. I know you have a big game coming up Saturday night, I'll be watching, against, of course, the New England Patriots, one of the league leaders. But we're going to get into that in a sec, Frank. But really, first of all, I want to thank you. I want to thank you for doing the podcast that you did with me, Two Fools, as I already mentioned, and I have just gotten so many wonderful stories and feedback. Not just directly from listeners and mailbags, but just from friends and family members. People who just love hearing your story, Frank. As I highlighted earlier, I should mention that I think it was just the combination of somebody who's a public figure, a very good person trying to do good stuff in this world, and we all know him in sports as a sports hero. But to hear the story, the backstory, the stock graph of your life, to hear the three key moments making you the investor that you are today, to hear the financial back life of somebody. I think that's such a human thing, and so I thank you for that, Frank.

Frank Reich: Thanks, David. It was a lot of fun. As an NFL Head Coach, I get to do a lot of media things, some interviews. I have to say during the podcast with you, that was a different kind of interview. It was intellectually curious and challenging and fun to do.

David Gardner: Thank you. The question I'll be asking each of my guests this week is, well, I have two questions but the first one, Frank, is what is one reflection that you have now about that podcast we did together? It was mid-July.

Frank Reich: It was mid-July right before the football season. I remember preparing for it and doing the stock graph over your life, which you referred to. That was a fun exercise. But as I reflected, really I'd like to reflect on the three investing things that really changed my life. Looking back on my notes, just the idea of trading conventional wisdom for Foolishness, I cannot explain to you how important that is to me and how that has helped me take control of my own financial life and world, and to be courageous in doing it. To learn, to trust to do that, and to experience what kind of courage it takes to be Foolish.

David Gardner: Thank you very much for that, Frank. As I hear you talk about that, I'm reminded of one of the big words that we use a lot around Fool HQ. That word is mindset. I really do think that one of the things The Motley Fool is trying to do in this world is switch as many people on to this idea that they can be in control of their own financial lives. They can be the quarterback of their financial life. For a lot of people, that is a real shift from how they started, and so I really appreciate you underlining that. The importance of mindset, which affects everything in our lives but often the big shifts as we look back over our lives or when we tossed away one framework and brought in another. We became a new person, we saw the world with new eyes. The world was the same, our eyes were all of a sudden new. Thank you for sharing that, Frank. I was thinking some about the show Hard Knocks, which I think some of our listeners will be familiar with. It's a very popular show, HBO, HBO Max streaming. Frank, you and the Indianapolis Colts are the focus of this show that traditionally has been around training camps. In each year for the new NFL season, they'll get behind the scenes looks at a different NFL team. This time, it's the Colts, but you did something a little crazy talking about challenging conventional wisdom. You're actually doing this during the season, really in the middle of a 7&6, a winning season right now. I'm curious, have you been surprised at all by the experience in any way, shape, or form?

Frank Reich: I have been. I was a little bit concerned at the very front end, hey, would this be a distraction? But I really have a lot of trust in our players, trust in our coaches a little bit. This is the world we live in. We live in this multimedia world, all the social stuff that we do, and it's really second nature to our players. I give NFL Films a lot of credit, who was behind getting all this content together. They're pros. It's done exceedingly well. I think there has been some benefit to it, David, that in one respect, I think it's shining a light on our players who I think are fantastic. Not only football players but human beings and all the work they're doing out in the community. But I also think it's an opportunity to shine a light on the players as what they're doing out on the field, and it's reminding us all the time that we're in a reality TV show right now and this is our life. We're in the middle of a playoff run, and this is all being documented under the lights. Hopefully, that's going to bring out the best in our team.

David Gardner: You and I talked earlier about the Heisenberg uncertainty principle, which basically posits that the act of observing something changes the nature of that thing itself. I'm curious whether you think that that has taken place. You're conscious as you're talking behind the scenes to your assisting coaches that there's a camera watching. I'm sure that's changing a little bit of how you're talking. But apart from that, what about winning and losing, which is such a big part of sports and certainly football. Do you feel like you've been winning since the show started? Is that coincidence?

Frank Reich: Well, I'm going to tell myself it's not a coincidence and use that principle. [laughs] That principle, I think, is not saying that it's changing. It doesn't imply that it's positively or negatively. That choice can be our choice and how we handle it. I think that's what it's all about. Handling it the right way, being professionals about it, and understanding. The reality is that there's a lot of positives to it that I think help us focus, but can there be distractions? Could it be pulled in the wrong direction? It could be, which is why we always have to keep our guard up. We can never take it for granted and we always have to continually focus on what is important, and that's preparing. Our preparation as coaches and players, that's what's core to what we do.

David Gardner: The Philadelphia 76ers basketball team became famous for the phrase, "trust the process." Of course, that concept has been around since the ancient Greeks, I am quite sure. But are you a trust-the-process guy, Frank Reich?

Frank Reich: I am all in on trust the process, and I would add to that, and the people. I really believe, David, that trusting another person is one of the most powerful things that you can do. I really think it's an opportunity to bring out the best in other people. I think at some level, the other person has to earn that trust, and of course, all the caveats and concerns that can come along with that. But I think what a good coach does, I think what a good friend does, I think what a good colleague does is finds moments and segments in a person's life where they can be trusted and that can help us take the next step of growth.

David Gardner: I intentionally left three seconds of silence there because to me, that's a mic drop moment, Frank. I really love that line and thank you for trust the people. So eloquent, so well said. Well, I've become an Indianapolis Colts fan. The Colts are now my team and I'm a Washington DC native now. Anybody in and around the Washington DC area knows the slow-motion train wreck [laughs] of a football team that plays nearby. Maybe it's easy to hop off the wagon. But no, I'm not so much hopping off a wagon, I'm hopping onto a wagon. I haven't yet gotten to see Hard Knocks, but I will be enjoying the show and looking forward to seeing a lot more of the stories and the players that you get to talk with everyday, Frank. 

But for those of us who are Indianapolis Colts fans, and I suspect there are more than at the start of this year among my podcast listeners, you have a big game coming up Saturday night. In fact, you play the next two Saturday nights, both times on national television. Frank, you're playing two of the best teams in the National Football League. Of course, this weekend, it's the New England Patriots, Bill Belichick. Then the following Saturday, which is Christmas night, and I'm curious what it's going to be like to play a football game on Christmas, not eve, Christmas evening. You take on the Arizona Cardinals, who I think may have the best record in the NFL. Any predictions or thoughts about either or both of those games?

Frank Reich: [laughs] Well, no. I'm not going to be baited into any predictions. [laughs] That is not in my repertoire. Our predictions and our expectations are about how we prepare. That I can predict that our players and coaches will be focused. I can predict that this is an important game in this playoff race. I can predict that we'll play for 60 minutes and will sell out. [laughs] I can predict that the best team will win.

David Gardner: Love it, and thank you for that. Frank, the national television exposure back-to-back Saturday nights combined with Hard Knocks, I have to believe the Irsay family is pretty happy with the exposure that their baby, their franchise, the team owners have for the Indianapolis Colts and the leadership that you're bringing. This is all becoming increasingly high-profile profile and I wish you all the best with that. Any thoughts what it's been like to work with a family of owners? We're a family company ourselves at The Motley Fool, not quite as well-known as the Indianapolis Colts. But I'm curious about how it's been for you in a way as CEO, at least at winning and losing working with a family?

Frank Reich: It's been fantastic. Mr. Irsay has three daughters. I have three daughters. He's a few years older than I am. But they make no mistake or they don't hide the fact that this is a family run business. Even though it's a billion-dollar business, it's a family run business. We embrace that. That's part of our culture. The mission statement for our organization is to entertain, inspire, and unite by winning the right way. I appreciate working for an organization that winning is important, but winning the right way is even more important. I really embrace that mission statement.

David Gardner: Well, thank you for that. As a conscious capitalist and a Motley Fool as well, I love me some purpose statements. I'm delighted to know that it's a purpose-driven enterprise. Now, Frank, I know you're awfully busy during this season. I'm curious, have you checked your stocks at all during this season? I know you're in meetings all the time, and if you're not there, you're in front of a camera out there on the field.

Frank Reich: David, to tell you the truth, I have not. It's so exciting. We talked about taking control of your portfolio and what a great feeling it is to do that in a way that I cannot look at it for six months. I probably during the season have looked at it once a month for the last three months and really have a peace about it. Every year, I spend a little bit of time right before training camp repositioning myself. Let me put myself in a position that if I can't look for six months, I'm good. That's an important deal to me.

David Gardner: Not only is that so beautiful to hear, that's true, but that is the right mentality, that's the right mindset. I will admit to checking my portfolio multiple times every day. But that's not because I need to, it's the same reason I watch games. I could just check the final score or look at the box score, but I really enjoy watching the game being played. That's obviously part of what I do. But I don't need to look at my portfolio yesterday, today, or tomorrow. It's so great to hear somebody who's really living that. But Frank, as you do check back in with that portfolio, first of all, welcome, it's December, you're getting a quick look at it. What do you see looking up and down the ReichFolio? What jumps out to you?

Frank Reich: Well, I would say just briefly that in the off-season, like you a little bit, I maybe don't check every day but try to check every day. I often tell people if I wasn't coaching football, I feel like I'd be asking to work for The Motley Fool. I really would. [laughs] But when I look down my portfolio, David, a couple of the companies that I've really enjoyed holding over the last couple of years, CrowdStrike's one that I've been on for a while. The Trade Desk has been a very good company.

David Gardner: Spectacular.

Frank Reich: Cloudflare, HubSpot. I just feel like Disney is headed the right direction. Twilio is a company that I've continued to buy. Okta is another good one that I've really enjoyed owning and believe in. Sea Limited. I've really enjoyed holdings, Sea Limited. Then I also think in the energy sector, SolarEdge Technologies. I remember listening to you on a podcast talk about that company. There was a uniqueness to the company that just caught my attention. I said, "I want to own this company," and I've continued to buy little pieces of it as time has gone on.

David Gardner: That's wonderful. Frank, you don't just buy once, you'll add over the course of time here and there.

Frank Reich: Yeah. I really do. I like to buy in smaller increments and continue to be disciplined. Generally speaking, if I want to get into a position, I'll think, hey, I want to own this much, and usually break it into thirds sometimes. Sometimes, I like a 50 percent in to start and then two 25 percent segments. That's pretty much the way I've handled it for the last five or 10 years or so.

David Gardner: I just love hearing that. So many people think it's all on or all off, it's just a buy or just a sell, but really, so much of it is being incremental and building a position over time and letting time be your friend. Just beautiful hearing those from you, Frank.

Frank Reich: I just think that maybe if there's one thing that I've learned from you and from Motley Fool, and I've learned this in sports, is that winners win. Don't be afraid of that. Don't be afraid of that. That's definitely talk about mindset. That's definitely a transformation in mindset that I've gone where these days I do not hesitate to add the winners. I look forward to adding the winners. I'm not so much caught up on what that gross margin is, I'm more interested in the total dollars. Yes, I understand as I'm adding it makes the percentage.

David Gardner: The overall return diluted.

Frank Reich: Diluted. That makes the overall return diluted, but I'm investing in a good company that's headed in the right direction for the long haul. That's been very helpful for me.

David Gardner: You mentioned Disney earlier. I can't think of many better examples really measured over real periods of time where winners keep winning. Disney is a great example of that. Frank, the final question for you, what I'll be asking each of my guests this week, what's a wish, an interesting thought, or a [laughs] prediction that you have for the year 2022?

Frank Reich: Well, I'll put this in the category of wish or prediction even as we were talking earlier about trading conventional wisdom for Foolishness, as far as the investing world. I've been thinking about what that looks like me passing that down to the next generation of my family. Certainly, I've been doing that at some level, David. But as I reflect, I think I've done an OK job of doing that. But now, just turning 60 and my children being in their early 30s and late 20s and their feet are on the ground, this is an opportunity for me to pass on a legacy, something that I didn't learn until I was probably in my 50s, that if I can help them understand some of the principles that The Motley Fool has taught me in investing and many times it's bigger than investing, but certainly investing. That's something I want to do with them. I really want to talk about to them, what does it mean to trade conventional wisdom for Foolishness. It's things we've talked about already, but take that to the next level and helping them understand that.

David Gardner: I love it. Congratulations, happy birthday. It was this month for you and your 60th birthday and your thoughts naturally shifting a generation later. It's something that's a privilege for any of us that can get to that point, that mindset that we can do that, that we can create a legacy. Frank Reich, you are certainly one such and you'll be an exemplar to a lot of people who are watching you and learn from you, me included, in terms of how you choose to do that over the course of the coming years. Frank Reich, in addition to wishing you a great 2022, I'm just going to wish you a great next couple of [laughs] Saturdays as well. One Fool to another, Fool on.

Frank Reich: Thank you.

David Gardner: All right. Well, the third Bestie goes to "300". That was the title of the podcast originally published this year on March 17th, Saint Patrick's Day, by the way, March 17th of this year. Now, the intent of that podcast was to properly celebrate 300 consecutive weeks of brand new Rule Breaker Investing podcasts from our outset in July of 2015. The only way to get to 300 is one week at a time over many years, so that was the intent. Really most of all to celebrate those who've done their run for glory, those who've heard all 300 of them, we were celebrating you. We do celebrate you. Thank you for your loyalty. Of course, to thank Rick Engdahl for producing from the outset, almost all of those 300 consecutive weekly podcasts, our Cal Ripken streak we like to play up on this podcast. But I want to note about that podcast is that I fully wrote out the entire script for that week's podcast. I rarely do that. Like, I don't know, maybe once in 300 podcasts. But this one, I wanted to be special and I had a lot of fun titling the three sections, so simply, you might remember the first was called This. The second was called Is. I'll let you guess the third, no spoilers here. But it was broken up into those three sections and there was something Foolish with the capital F, I thought about writing out a 10-minute meditation given a single word prompt, This. 

This, for instance, was pointing, well, really, at a very important line. The line where on social media you might just emoji a finger pointing up at something that you admire, something important, something you don't need to repeat. You just point at it with your emoji and signal, "This." Well, for me, this was this critical and underappreciated concept. How you and I or anyone you're studying or observing, how they made their money? When you really think about it, you think about investing and business and life, you realize how critical and beautiful. Thank you, Warren Berger, that question is, it's a beautiful question. How did you make your money? Anyway, that was This. I'll leave you to think about Is, which was the second section, and the third section as well, which was Sparta. Wait, did I just spoil the third section in the podcast 300? Well, no. Not really. So yeah, "300" wins the Bestie because I think it stands out as a timeless meditation that just happened to issue from March 2021. Well, it didn't just happen, it happened that week because that week was Rule Breaker Investing consecutive podcast number 300. Bestie number 3, "300". 

Well, on now to Bestie number 4. On February 17th of 2021, we recorded a podcast entitled simply Bitcoin 2021. My intent at the time was to get two of the brightest, most intellectually curious people I know together to help me and you think about how to think about Bitcoin, cryptocurrencies, etc. Well, Jim Surowiecki, a classmate of mine from college, a former Motley Fool employee, and financial writer of the smash best-seller, Wisdom of the Crowds, had recently written a column about Bitcoin. As in one sense, he said, "As a failed currency." Jim said, "Hey, if it's supposed to be a currency, why isn't anyone seeming to use it that way?" I also invited on Aaron Bush, my longtime co-conspirator in Motley Fool services like Rule Breakers and Supernova. Aaron held somewhat of a different view, Bitcoin and really more broadly, cryptocurrencies, as potentially the ultimate Rule Breaker. Well, I didn't set up the conversation to be a debate. 

In fact, as you might expect from two very bright people, they agreed and agreed probably on more things than they disagree on. But especially if you're someone having a hard time still wrapping your brain around what's happening out there in crypto land? Did you see Los Angeles' beautiful Staples Center is about to become Crypto.com Arena for the next 20 years? Well, it turns out what's happening in crypto land is having some pretty big and noticeable effects on what's happening in the so-called real world these days. Anyway, so I thought then, and I still think now that one thing you should always try to do as a Foolish investor, is convene really smart people and just listen and learn. Which is in a lot of ways what this podcast tries to do all 52-weeks, Besties Week included. 

This was an easy podcast to honor with the Bestie because just to be a fly on the wall, which is what I was for one hour and one minute in February, you too, that could be very valuable. I want to mention two things before I welcome my next surprise guests. First, Aaron Bush himself is up and away in a plane and so couldn't make this week's podcast to receive his Bestie, but he did send me a few compelling thoughts that I'm going to share with you. Second, I'm delighted to be joined by Jim Surowiecki who is coming on very shortly to make his guest star cameo. But I do want to mention that I promised and I will deliver on a podcast focused on NFTs, non-fungible tokens in the new year. Aaron is going to help me plan that one out coming soon in January. Well, without further ado, let me welcome back my longtime friend, Jim Surowiecki. Jim, welcome back to Rule Breaker Investing.

Jim Surowiecki: Thanks for having me on, David.

David Gardner: It's a delight and thank you, Jim. I really enjoy the conversation. It was always fun to reconnect with you, a delight here. You told me offline, you're teaching at Yale, teaching essay writing.

Jim Surowiecki: Yes.

David Gardner: Because you're still doing a lot of writing yourself but I love that you have found and I know you are a native of the state of Connecticut, as I recall. Cheshire, Connecticut product, am I right?

Jim Surowiecki: Yeah. New Haven, I'm living now about half-hour South. It's not exactly where I grew up. I was born in Meriden, which is right near there. But yeah, about half-hour South. It's great. My mom's still here, so which is great for my kids.

David Gardner: Tremendous. Well, as I mentioned earlier, someone who's not here is Aaron Bush, who also provided a wonderful perspective when we got together in February. I know we're going to talk a little bit about this. The world in some ways has changed since February, but in some ways, maybe it hasn't changed that much and I'll let you play with that a little bit later. But Jim, the opening question that I have to ask each of our guest stars this week is, what's one reflection that you have now about that podcast we did together?

Jim Surowiecki: Well, I think what's interesting is when you go back and look at it, when we had that podcast. We had it in about mid-February and it was right after basically, if you remember, Bitcoin went almost straight up from the beginning of the year, from the beginning of 2021. It went straight up for about six weeks. Actually, I think it probably, when rising going into the end of the year of 2020. Then it peaked at around 57,000, and then, we talked a couple of days after it started to fall. It fell down and went back up, blah, blah, blah. What's interesting to me is, of course, that it's not surprising if you look at the Bitcoin chart over the course of the year, you just see these crazy fluctuations and yet where it's ended up is I guess now it's down to 47, but if we had talked three weeks ago, whatever it was, it would've been at 65. In some ways, there has been this incredible volatility of course, and yet in a lot of ways, it has ended up pretty much very close or close, at least to where it was. 

The interesting thing to me is that I don't actually feel like the Bitcoin story has changed very much over the course of the year, which is funny to say, because obviously, in crypto, there has been an incredible amount of action, there has been an incredible amount of cultural attention. There's so much more interest in it. Then the intersection of crypto and NFTs has created this entirely new dynamic. Then something we can talk about in a minute maybe is the rise of Web3 or DAOs or wherever it is that I don't really fully understand. But that has obviously engendered a lot of interest in the long-term possibilities of things like Ethereum. Yet, Bitcoin in some ways feels stable is not quite the right word because of all the volatility and yet it does feel like it is established in some way and that its existence as what others have called Digital Gold, that does seem to be its main role right now. It's interesting because one argument that you sometimes heard was that Bitcoin would be hedged against inflation. But what's interesting is that over the last whatever, four or five weeks even as inflation concerns have really risen, that's obviously you have not seen Bitcoin's price rise at all. 

That does suggest maybe to me that those markets are more disconnected than you might think, that it is in a hedge in the traditional way. The last thing I think about is I've been writing about Bitcoin since 2011, I mean, periodically, not all the time, or anything like that and I have been skeptical of Bitcoin the entire time. [laughs] I've been skeptical of it the whole time. I think when we talked, I joked about the fact that if I had just invested $1,000 in Bitcoin when I first wrote about it, I'd probably be a millionaire if I had held onto things. But the problem I have always had with Bitcoin or the thing about it that I think has always been problematic is that I don't think it's well-designed as a currency, which is how it was originally designed. The dream of Bitcoin replacing cash, replacing the dollar, it doesn't work, I don't think. I don't think the way it's set up or the way it's organized, some of the things make it attractive as an asset, other things that make it not attractive as a currency. But in a lot of ways, I think maybe now that critique doesn't matter, people aren't really thinking of it in that way anymore. People don't think that much about like, am I going to use it as money, they really are thinking about it more as just like, this is an asset I have that I can hold on to or I can speculate in. I don't know if I can see the case for it, but I understand why people are thinking of it in those terms.

David Gardner: Well, very well said, Jim. You're speaking almost boundlessly because we could go anywhere with this brief conversation we're having because I mean, in between when you and I talked with Aaron in February and now, El Salvador announced that it was almost like making a currency, but now I read in headlines that the president is going a different direction now. He feels like that wasn't the right move. At one point in North Carolina, I took a photo and tweeted it out of a Bitcoin ATM at just whatever the service station was that I'd stop that in North Carolina, I'm still not even sure what that was. But Aaron did share some thoughts. I'll just share one of them here. He said he does still think Bitcoin is best viewed as Digital Gold. Basically, agreeing with what you just said, Jim. Aaron says, "I expect more individuals, institutions, and governments will come around to that in the upcoming months and years."

Jim Surowiecki: I mean, the El Salvador thing was interesting. One of the things that I think has always been conceptually challenging when you think about crypto, let's call it crypto advocates or whatever you want to call it, is that on the one hand, the case for cryptocurrency has been about it as a alternative to fiat currencies, a way of moving outside of traditional governments, of liberating people from the constraints of central banks or whatever and yet, there's also this quest for legitimacy and this hunger for Bitcoin to be accepted by the very institutions that in some ways crypto was designed to get around. The El Salvador thing was the classic example of that. Bitcoin supporters were so happy when El Salvador did this and it was like, "Why?" I mean, I understood why. They are going to be buying Bitcoin or whatever. But I thought that was also a classic case where, when you went and read the stories about people in San Salvador, the capital or whatever, who were trying to say to themselves, "Wait, I have to do transactions in Bitcoin if someone wants to do them? How am I supposed to do this?" It did seem wholly improbable I think.

David Gardner: Maybe a little bit half-baked. Not from a particularly leading economy worldwide, but I will add one more thought from Aaron. Aaron sent these thoughts to me in advance of this week's podcast, he said," Bitcoin gets heavily discussed because it's the top dog and first-mover. However, the building, the talent flows, the venture dollars in crypto are rapidly going elsewhere." He writes, "Digital Gold is interesting, but platforms like Ethereum, Solana, and Terra that enable entrepreneurs and builders to create massive diverse projects in new ways are even more exciting."

Jim Surowiecki: Yes, I think that's the really interesting thing going forward. I mean, there's two things to say. Well, there's many things to say about that, but I will say two things. One thing that has been interesting about the NFT boom, which I've also, of course, been very skeptical of, but one of the things that's interesting about it is that in part because on a lot of these sites initially at least, you had to use Ethereum to buy the NFTs. It did actually get the currency in circulation to some degree and get people used to using it to buy and sell. Obviously, there'd always been like a sector of crypto nerds who did that, but this was a little bit more of a mainstreaming thing. I think that there are cryptocurrencies that, well, quite a few that are just much better designed to function as currencies than Bitcoin is. 

But I think the second thing is the thing that Aaron is really gesturing at, which is probably the more intriguing and potentially transformative thing, which is the way that Ethereum and other platforms are potentially being able to be used for building really interesting organizations of complicated novel forms. This is all the hype around Web3 and the decentralized autonomous organizations, which [laughs] I find very difficult to get my mind around exactly what it's going to end up looking like. But I think that is probably the more interesting story going forward. There are still things that will probably happen with Bitcoin when, whatever, Elon Musk says they will or won't accept it for Tesla, whatever it is, and there's going to be a lot of obviously volatility around these crappy little coins, but I do think that those platforms are probably more interesting thing going forward.

David Gardner: Thank you for that, Jim. The closing question that I have for you and each of our guests is, what's a wish, an interesting thought, or a prediction, that you have for the year 2022. I'm going to give you just a minute to think about that because I think I sprang that on you a little bit late in the process. I know you are always ready anyway, but I will just mention, since Aaron sent his in, and I'm not going to read it in full, but basically, Aaron was saying that he doesn't think that Bitcoin will always be the largest crypto asset. Its dominance as a percentage of the total crypto market will continue to decline and he expects Ethereum to eventually support a larger market cap than Bitcoin. A lot of guests naturally want to go toward an interesting thought or a wish, and I probably would do that myself. Aaron actually went with the prediction angle here. No pressure, Jim, [laughs] but what wish, interesting thought or prediction do you have?

Jim Surowiecki: Let me do two. One is, my wish is that I get a better handle on what a decentralized autonomous organization actually is [laughs] and what it involves. Especially as the author of the Wisdom of Crowds and someone who is very interested in collective action and collective problem solving, it seems like there are interesting overlaps there, but I'm interested in how these things are going to play themselves out in reality. I will not make a prediction. The second wish is probably the most banal wish, but I got to say, which is, I really wish by, let's say the summer that we are clear of where we are in the pandemic and that we are, it's been, obviously much better since we all just got vaccinated and the rest, but I'm pretty tired of it. It will be nice to just reflect on investing in business without always having the shadow of the next variant hanging over us. That I think is probably my biggest real wish.

David Gardner: Amen, brother. Thank you. I think we all feel that and that's very well said. Jim Surowiecki and by association, Aaron Bush somewhere on a plane with his notes, thank you both again for a wonderful conversation. I'm looking forward to having another one in 2022 and thinking forward about where we are, and Jim, de-centralized, what's the magic phrase?

Jim Surowiecki: DAO, decentralized autonomous organizations.

David Gardner: That is it. Decentralized autonomous organizations, something we should be paying attention to. I know while you're saying, rather humbly that you still want to figure it out, you are actually actively asking questions about what that means, given who you are. That's something that we should all aspire to is always be asking the most important questions that we can. Thank you, Jim.

Jim Surowiecki: Thanks for having me on, David. I appreciate it.

David Gardner: On to Bestie number 5, the fifth Bestie goes to Great Quotes, Volume 13, Morgan Housel Edition. This originally appeared on June 9th of this year. If you didn't get a chance to listen to it, or even if you did, I might highly suggest you visit or revisit that podcast for 56 minutes of Morgan's wisdom. The intent of that podcast, well, was to ensure that Morgan's mindset and his wisdom and his perspective about money writ large, would reach as many people as possible. He's doing a great job already selling more than a million copies of his book, The Psychology of Money. But another podcast, appearance of two can't hurt probably. The intent on the one hand was to make sure we spread that word. But really, I just like hanging out with the guy. I think that my intent was just to spend good quality hour with Morgan. The history of this, perhaps the longest running series I've done on Rule Breaker Investing, the Great Quotes series, this was Volume 13. Typically I have featured past authors, people from the past. I think about Dr. Seuss, for example, and his quote, "Young man," laughed the farmer, "you must be a fool, you'll never catch fish in McElligot's pool." That's an investing insight by the way, you have to go back and listen to that one in the past. 

But yeah, I'll have Dr. Seuss or maybe Antoine de Saint-Exupery. Remember this beautiful line, if you want to build a ship, don't drum up the men to gather wood, divide the work and give orders. Instead teach them to yearn for the vast and endless seas. For many years, I've rocked other people's quotations. Generally, people who are no longer living, but with Morgan on, I thought, let's do something special, let's have Morgan, some of his greatest quotes, and that's why I think it was such an enjoyable podcast to do together because I'm pretty sure I can't get Dr. Seuss on this show, and I don't think Antoine de Saint-Exupery would make a great appearance on this show in 2021. But you know who did, Morgan Housel. It's really a first-time that I had Morgan on Rule Breaker Investing, certainly won't be the last. This Bestie number 5 goes to Morgan Housel and Great Quotes Volume 13, the Housel Edition. I'm really happy to let you know that Morgan's back for his second appearance on this podcast because he's about to join me right now with this cameo guest star appearance. Morgan, thank you for rejoining me here on Rule Breaker Investing.

Morgan Housel: Thanks so much for having me. I'm just happy to be a stand-in for Dr. Seuss. I'm [laughs] glad that I'm still living, [laughs] and to be one of the speakers here who is still living doing these quotes with you. Let's cross my fingers that, that maintains for a while.

David Gardner: Turns up, brilliant writers can actually write things and still be alive to talk about them, even on podcasts sometimes. They don't need to die to really be remembered and appreciated. I think that was true with Theodor Geisel during his life as well, I never did meet him. Did you ever get to be in the presence of Theodor Geisel?

Morgan Housel: No. I have no idea when he lived. What was his era? I have no idea.

David Gardner: Now you have me going and checking with one of my best friends, as I've often said in the past of this podcast, Wikipedia. Turns out Theodore Seuss, it was his middle name, Geisel, was born on March 2nd of 1904, Morgan, he died on September 24th of 1991. Which means I was around for a good 25 years, and I never did get to meet him. I'm certainly a fan, a Springfield, Massachusetts product, he died in San Diego, California. But in between, he made a lot of people happy, and ever since then, 1991, I think his reputation has only grown.

Morgan Housel: I'm so curious people like that, what they're actually like in their real everyday life. When he's talking to his wife, talking to his kids, is he doing little rhymes, coming up a little crazy names for stuff, or is he just a normal guy, and that was his work personality?

David Gardner: Or maybe he has very strongly held angry political views that you just wouldn't otherwise [laughs] know, there's politics that runs through everything, if some people point that out about Seuss, but I got to believe he's a fairly mild mannered gentleman.

Morgan Housel: I hope so.

David Gardner: I want to think that anyway, we both hope that. Well, Morgan, thanks for joining me. I want to start by asking you a familiar question. Anybody who is listening thus far into the podcast, and that's Morgan Housel, what's one reflection that you have now about that podcast we did together?

Morgan Housel: Here's what's interesting, when you come up with these quotes, that I feel like summarize how I think about money, how I think about investing, a lot of those quotes are things that five-years ago, I either had not really thought of yet, or I actively disagreed with them. [laughs] The question is, five years from now, what new views will I have about money and what will I disagree with that I believe today, and I think that is true for you, and it's true for everyone else. There's this thing in psychology called the end of history illusion. Which means that everyone is keenly aware of how they've changed in the past, but we all underestimate how much we're going to change in the future. I know that I'm a different person than I was 10 years ago, but I don't think I will be much different 10 years from now, that's the illusion that we all fall for. That's a lot of what I think about this stuff, and with investing too, 20 years from now, you and everyone else are going to have different views about investing, some of which you would disagree with today. That's a little scary, it's also a little exciting, just to know that we're all going to keep learning and evolving and trying to figure out new things and realize how wrong we were at various things in the past, even when we were so certain in our views at the time.

David Gardner: Really love that reflection. I totally agree with that. In fact, I might be somebody who over-indexes toward changing more or faster than I think I will. Some of us are probably more sticks in the mud, some of us maybe more fly by-night, I think I tend more toward the latter. Morgan, I was saying to my wife as I walked around and something I'll mention in a sec that, if I'd seen a picture of myself 10 years ago today, walking around these days in Crocs, in my house, Crocs, in socks, I would've wanted to punch myself out I think, 10 years ago and yet, there I am, I'm a big Crocs fan.

Morgan Housel: To bring this full circle, Crocs and socks was a Dr. Seuss book, was it not?

David Gardner: [laughs] I'll tell you this, it was an awfully good site at LiveSketch and it's watchable on YouTube. I totally recommend it to anybody who's not seen it. It very much sounds Seussian. June 9th, Morgan, was when you and I spent time together on the podcast. Here we are about six months later. Have your views changed, modulated at all in the last six months in any way that's identifiable to you?

Morgan Housel: Here's here's one thing that sticks out. I was thinking about this the other day. March of 2020, when COVID really hit and people started paying attention to it, the market collapsed, market fell 30, 40 percent, and the global economy collapsed as well. Twenty million Americans lost their jobs in three weeks, completely without precedent, at that time, and for probably a year after. I thought that the economic crisis of 2020 would've been a generational scarring event, similar to the great depression or 2008, where it just, it's so traumatizing to so many people that it sticks with them for a long period of time. I think I believe that less now than I did a year ago. Particularly for the stock market, in that, that market crash of 2020 was so short lived, and it was followed by such an enormous rally that's brought us to where we are today. You add in this other element that I didn't really think about it the time, which is that in March of 2020, most people were not paying attention to their stock portfolios. Even if they were investors, they were worried about their health and how they're going to get their kids to school, and how do you work from home, and is the grocery store out of food?

David Gardner: [laughs] You bet.

Morgan Housel: Your stock portfolio performance was not on the top 20 list of your worries at the time. Because of that, I think the impact that it had on investors is much less than previous market crashes. I think I've augmented my views of thinking that what happened economically in 2020, is going to have a smaller scarring impact on people than I thought it did one year ago.

David Gardner: Really well said. Indeed, it was shocking to me to watch the stock market go down 35 percentage points in 32 days as I recall. Then to think that we were higher by year-end or at least a lot of the Rule Breaker stocks that I follow, were well higher and I think you and I talked about this. I think this is probably a truism at this point that what was happening in part of the last 18 months with the rises's stocks were borrowing forward some of their futures. We saw things like Zoom accelerate. Just zoom to the point that it was probably borrowing forward from some of its growth and gains in still the years to come in a dramatic 18-month rally. We have seen the last month or so, some of these companies give away quite a bit of value. Of course, I will say about you, Morgan, as I recall, you are an index fund buyers. You may not even care about Zoom versus anything else or disabuse me of that. But whether you're into index funds or stocks, all that really matters, as we both would say, is the long term. 

Morgan Housel: We definitely agree on that latter point, but I would say, look, as an index investor, I own Zoom and Tesla and all the others. That's good. To me, that's the purpose of an index fund investor is to guarantee that you are going to own all of those few stocks that become the mega winners lot of times. I think the overlap between what I do and what you do, David, is probably, I think from the outside, some people might think it's very different. To me, the Venn diagram of what you and I do is actually very overlapped. We are just going about it in a slightly different tactical way.

David Gardner: I agree. Well said, Morgan. Speaking of what you do, what are you doing these days? I know you're still basking in the warmth and glow of an international best-seller, a smash hit, and something that I hope the whole world reads, because it's a better world. Every single person who reads, The Psychology of Money by Morgan Housel. But Morgan, I'm curious, are you looking to follow that book up? I remember there was an announcement of a streaming series or something I think around your book. I may not be keeping up. How are you spending your time these days? What are you excited about for 2022?

Morgan Housel: Well, I'm just doing the same stuff I have always done. I just like doing a lot of reading and talking to people and going for walks and think about stuff and then just trying to write down whatever I find interesting. I do that on my blog every week. I'm working on another book right now that will probably be out in another year or so. You're right, the film rights for Psychology of Money were sold and they'll eventually turn into a documentary. That's a very slow process as I've learned over time. But other than that, I just like doing what I've always done. I don't really try to have a ton of structure, big, hairy, long-term goals. I just like wondering around and seeing where it takes me.

David Gardner: Will you give us any hint of your next work? Having not read your blog actively right now, I have to admit if you just told the world about a month ago, I missed it, but I'm starting to pay attention here and I'm excited. Do you have the epigraph in mind for the whole book? The frontest piece, you want to give us a look at the acknowledgments. Give us a taste of your next book.

Morgan Housel: Well, let me give you a taste of it with this great story that I heard from Jeff Bezos several years ago. Jeff Bezos said that he is very often asked what is going to change at Amazon over the next five or 10 years. These people asking that question all the time. He said that's an interesting question. But a much more important question is, what is not going to change at Amazon over the next 10 years? Because he said, "It is impossible to imagine a world in which consumers want slower shipping and higher prices and less selections." It's impossible to imagine that world. So that he as someone who is at the time running Amazon, you could put so much effort and investment into fast shipping, low prices, and big selection, because he knows that those are going to be an integral part of the business forever. 

He said, "What's more important than asking what's going to change is asking what is not going to change. That's where you can put a lot of your effort in seeing in the future." I just like that idea of like what never changes in business and investing. We put so much effort for good reason trying to figure out what's going to change. What are the new innovations? What are the new industries? What's going to change and which is great. But I think we don't spend enough effort and attention on thinking about what is never going to change. What are the behaviors of investing and the dynamics of businesses that were true 100 years ago? There will be true 100 years from now. If we put a lot of effort into those knowing that there will be part of the future, I think we actually have a better chance of being able to see the future than guessing, estimating, trying to figure out where the world is going next. The book is about what never changes over time.

David Gardner: I love it. One of the things I love about you, Morgan, is that you're really great with a capital F, Foolish viewpoint at looking at the other side of things. If there's a conventional wisdom out there, surely, there might be some value to looking at things differently from how everybody else's. I certainly agree with you as the change focused world wondering what does Omicron mean versus Delta. The list goes on of all the things that we're wondering about that seem to be changing all the time and yet we're forgetting the statues and the gravestones, and buildings and the things that endure, and those are just the physical things. How about all of the mental and cultural things? Those things are strong. Boy, Jeff Bezos is great. Spun off a fair amount of value by thinking 5-10 years forward about what won't change. It sounds like that's your focus and that sounds great to me, Morgan. Well, congratulations.

Morgan Housel: Thank you.

David Gardner: Morgan, let me close by asking you, what's a wish, an interesting thought, or a prediction that you have for the year 2022?

Morgan Housel: Here's what I think is an interesting thought in 2022. The college graduates of 2022, will obviously have been born by and large in the year 2000, which is both weird to think about. It's crazy. Once you get older, the young people, it's staggering to think about what year they were born. But it's interesting in that year 2000, was the demarcation line for when technology and the Internet really became mainstream. It's also one of the dot-com bubble bust. But the year 2000 was when a large number of people really started getting onto the Internet and it became a more integral part of our lives. I think it's interesting that the people who are now graduating from college, entering the work world and starting their careers are going to start becoming analysts and supervisors and managers and CEOs one day, are the people who were born when the Internet was already an integral part of society. If you can trust that with you and I, who came across technology when we were adults, and we had to answer the question, how does this new thing fit into our lives that we've already built? 

That is a very different dynamic than someone for whom this is all they've ever known. Technology was around since the date that they were born. Rather than trying to fit something new into their lives, this is how the world works. I think anyone with a child who has seen a four-year-old operate an iPhone with more skill than a 65-year-old knows that when you learn things at a young age, when your brain is that pliable and you start learning computers and technology and coding, when you are toddler, literally, then where that leads you when you're an adult is staggering. I think that the technological savvy and skill and just comfort that this college graduates have is in order of magnitude higher than it was when I graduated college. When you graduated college is just completely different universe and I think we probably underestimate what that's going to do to innovation over the next generation. The fact that these new young adults who are entering the work world have never known anything else, but a world of high-technology.

David Gardner: It's a very interesting thought and yes, this generation is the first in history to grow up with a screen in their hand a lot of the time for better and we know sometimes for worse as well. I'm curious, Morgan, I'm obviously generally pro screens. Because even before iPhones, some of the Gardner kids had game boys in their hands for a whole lot of time. It wasn't just smartphones, it was hand-held video games for a longer time before that. You're a dad, one of the many roles you play, Morgan, in the young family. What it is or will be your approach to screens for the Housels?

Morgan Housel: Our kids are two and six, and they both watch YouTube. The great thing about YouTube is that there's actually a lot of very great educational, very appropriate content for kids on there. Though it's not, but it's actually the things that they watch and like, "Oh, this is great. You guys are learning." What's interesting too about screens that I did not realize before becoming a parent is that the screens benefit the parents just as much as the kids because the screens can become within moderation, in reason, the babysitter for the parents. The screens keep the kids occupied. They're happy. They love it. I think it's incredible too how much, and how many channels are out there on YouTube for people that have become like mega stars and celebrities for these kids. They are just random people with an iPhone and a YouTube channel. It used to be you needed to like work your way up and have an agent and get discovered by Discovery Channel or NBC or Nickelodeon or whatever.

David Gardner: Meet the studio execs.

Morgan Housel: Meet the execs and now anyone who's talented with a phone and a YouTube channel can literally become the biggest celebrity of tens of millions of kids lives. I think it's awesome to watch and see. Our son who six, is just starting to get into some video games, Minecraft, and whatnot, which is cool too. I still don't understand why graphics have declined over time and now, the best video games like Minecraft, look that they are built in 1964. I don't understand that yet, but that's what the kids like apparently.

David Gardner: 16-bit audio video, still works retro. It's cool and really, do you think about it? Four-year-olds don't have any sense of what things used to be or don't. I think simple graphics, yeah, we're reminded as adults or the smart indie video game developers who go that direction recognize it's pretty timeless, just like cartoons. Morgan Housel, thank you so much for joining us this week on the year-end extravaganza Bestie show. It was definitely a best conversation I had with you this year. It's not hard to have with you though, sir. I hope you have a wonderful 2022. Great holidays with your family and Fool on.

Morgan Housel: Thanks so much, David. Best to you as well.

David Gardner: Onto Bestie number 6. It was originally published on February 24th of this year. It was our February Mailbag, Tinker, Tailor, Soldier, Sailor. Now, the intent of that particular podcast, well, it's the same intent as any other Mailbag to listen to you, to learn from you, to be inspired, and to respond. That's a rhythm that I've said in place for dozens and dozens of times, looking back over seven years now, listening to you, learning from you, being inspired by you, and responding, and as I said, a little bit last week, along with Thomas Jefferson, you light my candle, I light your candle back. That's happening every month at the end of the month as it will at the end of this month, once again, with the Mailbag. But I suddenly realized about that particular Mailbag for whatever reason, February of 2021, I suddenly realized that I didn't just have a bunch of listeners telling their stories as they email us at [email protected]. I actually had, I realized that day an embarrassment of riches. 

I had seven remarkable stories, all incoming, but in part remarkable because of the wide contrast between them. Now, those who listen to the podcast will remember the four questions that I asked you to think about with each of those stories and I'm going to remind you of those now because I think they are great questions to ask as you reflect on any story. The four that we used as a regular rhythm throughout that month's podcast, Tinker, Tailor, Soldier, Sailor. The first question is, after I tell you the story, what most jumped out to you? The second was, what do you see of yourself in the story? The third, what do you most admire about what you just heard? The fourth and final question I asked about each of those stories in February, I would ask you to ask yourself this. Anytime you hear a story, do you have any intention that you will convert to action as a result of hearing the story? Well, of course, with this best year, I want to give a nod to all of our Mailbags, especially those that show you off at your best stories that inspire and instruct stories that make you smarter, happier, and richer. Probably, there's no better or lasting way to shape the future than to tell true great stories and the seven stories that emerged from that podcast. 

We didn't actually have a tinker, a tailor, a soldier, or a sailor on that podcast, but we did have a jockey, and a film professional, and a Czech native, and the financial advisor, and a firefighter, and a gamer, and we closed with a winner, Jason Moore. Being able to tell those stories, jockey, film professional, Czech native, financial advisor, firefighter, gamer, winner. I remember quoting as I will once again, one of my favorite quotes from Tolkien, I know there are a lot of Tolkien fans out there. I know you know what's coming here, it's about stories to line from Sam Gamgee. "It's like in the great stories, Mr. Frodo, the ones that really matter. These are the stories that stay with you, that means something even if you're too small to understand why. But I think Mr. Frodo," said Sam. "I do understand, I know now, folk in these stories had lots of chances of turning back, only they didn't. They kept going because they were holding onto something that there is some good in this world and it's worth fighting for." Well, thank you again to each of you who write into any Mailbag. 

But in particular, this Bestie went this year to the February Mailbag, Tinker, Tailor, Soldier, Sailor. Bestie, number 6. Well, on to number 7, lucky seven. The 7th Bestie goes to the Market Cap Game Show, Brian versus Brian, which was done on the penultimate week of the 3rd quarter. That's the rhythm for these four times a year for the Market Cap Game Show, always the penultimate week of the calendar quarter. In this case, it was September 22nd, so the intent of the Market Cap Game Show, I'm sure you know, dear listener. I hope many months or many years is to bring on two Fool analysts who are going to bravely challenge each other at knowing the market caps of some of the better and lesser known [laughs] companies in The Motley Fool universe. Well, in the case of Brian versus Brian, this show brought on to my favorite Fools who both happen to have worked with me in different context as employees or contractors over the years, and as fellow Rule Breakers. But in particular over the last two years, Brian Feroldi and Brian Stoffel have really shined on Motley Fool Live and in social media, and of course, the series itself, the Market Cap Game Show has the intent to make you smarter, happier, and richer by focusing you on a number that most people don't look at or think about enough, and that's the market capitalization of any company that we're talking about. 

The content of that show and indeed all the others that have preceded it, well, it's the typical game. The same game for the most part, played for the last four or five years, with of course, that one tweak when the skies open and Adam Nelson spoke down to me about how to improve the Market Cap Game Show further by making an arranged based answer. But anyway, the same fun game, but really fun I thought with these two characters, Brian versus Brian, and significantly, they tied spoiler alert. They tied five all, which means we have to have a rematch and in fact, I'm happy to let you know that on next week's Rule Breaker Investing podcast, we're going to have Brian and Brian back and we're going to have it out and maybe break that tie. Yeah, next week is the penultimate week of the 4th calendar quarter, and therefore, the Market Cap Game Show, Brian versus Brian 2 is upon us. But this Bestie recognizes not just their work, but of course the work of so many analysts and advisors and Fool personalities over the year, starting with Matt Argersinger back in the day including Aaron Bush, Emily Flippen, Maria Gallagher, the list goes on. Anybody, whoever won, sometimes one more than once, people who've played the game. Great. I love all my children, I love all of my Market Cap Game Show episodes. But I thought that Brian versus Brian one was quite spectacular this year and we're looking forward to continuing it next week. Oh, my gosh. Cameos from the guest stars themselves, Brian Feroldi and Brian Stoffel. Great to have you guys back to Rule Breaker Investing.

Brian Stoffel: Thanks, David. 

Brian Feroldi: Awesome to be here as always.

David Gardner: I want to thank you, first of all, just for playing the game. Playing the game in 2021, I would say it's an active courage to step forward in public and put your best estimate on these big, always changing numbers that I want more and more investors to pay attention to and learn and to do so in a competitive environment of funds, so thank you, guys. Let me first go to Brian Feroldi. Brian, what's one reflection that you have now about that podcast we did together on September 22nd?

Brian Feroldi: I actually recently went back in prep for coming on this and quickly skim through it so I could rehear the 10 companies that we talked about.

David Gardner: Awesome.

Brian Feroldi: A general takeaway that I had is when we were wrong, we overestimated the company's market cap. However, there was one company where Mr. Stoffel over here, significantly overestimated the company's market cap. It was way smaller than we thought it was going to be. I know that happened with Etsy many, many times in the past and Etsy turned out to be a great investment, so I'm going to double-down my research on DermTech. Brian thought it was a three billion dollar company, if I look today, it's like a $500 million company. If his instincts are right, there could be some significant upside ahead for that.

David Gardner: Love it. Brian Stoffel, do you remember doing that? What do you think of DermTech these days?

Brian Stoffel: I don't think about it very much, clearly, if I multiply in order of magnitude. If DermTech ends up being a winning investment though, I want to all the credit. If this is a bad idea, [laughs] I want to go talk to Brian Feroldi.

David Gardner: Well, I'm going to ask you now, Brian Stoffel, the same question, but you're not allowed to answer what you just did even though that was a good reflection you're having right now about that podcast we did together. But let me turn back to you more formerly now, Brian, in essence say, what's one reflection that you have now about that podcast we did together?

Brian Stoffel: The moment, David, that's sticks out in my mind has more to do with the game theory behind this game and it was when Axon Enterprise came up, because if there's one stock that I know the market cap of, that's it. But here's the interesting part. Brian was the one who had to give the range and I was one who got to guess, so I feel like that's game over. Like I am trying to get that one right. But, and this is where it gets really interesting, what if it was switched and it was Axon Enterprise, but I'm the one who is giving the range? Brian knows that I know Axon Enterprise better than any other company, so Brian has to figure out, am I trying to fool him and I give him a false range, or am I assuming that he is going to think I'm trying? It's a very Mandy Patinkin, Princess Bride to that scenario.

David Gardner: Exactly. That's where I was headed as well, Brian, that's a great point. Yeah, it is more of a game that you'd think, more of a game than it started. Because the initial version of the Market Cap Game Show when it first featured Matt Argersinger, something like four or five years ago, was just, could you nail it within 20 percent? You weren't playing against anybody else, you were just there and both of you guys would nail Axon under that rule base. But with this new approach, you have to go Mandy Patinkin, or really, it was Wally Shawn. Wasn't it Wally Shawn sitting there going?

Brian Stoffel: Maybe he was the one, he took the poison over time so that he would have been fine no matter who drinks.

David Gardner: Yes. Exactly.

Rick Engdahl: I'm sorry, that is incorrect. Mandy Patinkin, Inigo Montoya was defeated in the sword fight. I just want to make sure that we have that clear for our sense.

David Gardner: Of course, and how many times have I seen the [laughs] movie, but admittedly, not for some years, so even when we get our market caps right, sometimes, we can get other things wrong too. Guys, are we human?

Brian Stoffel: Yeah.

Brian Feroldi: Extremely.

Rick Engdahl: Inconceivable.

David Gardner: Inconceivable. Thank you, Rick Engdahl. Well guys, I'm about to ask you the question I'm asking our other guest stars this week, but I thought before I ask you that forward-looking question, I thought we should just briefly play one stock in the Market Cap Game Show and just a little bit of background without too much of a spoiler because part of the reason we do the best ease is to point people back and relisten as Brian Feroldi did this week, but relisten to that pockets if they missed it and it's a lot of fun. I don't want to spoil it too much, but it might be that your final scores were very similar to each other. Some people might want to tie breaker and this is not formerly a tiebreaker, guys. Since you're going to be on next week, we're playing the game together. We agreed ahead of time off the air that if Brian and Brian tie again, this will serve as a pre-tie breaker. In some ways, this is fluff and doesn't count, and in some ways, this could mean everything.

Brian Stoffel: This is like the All-Star Game, who gets to host the world series.

David Gardner: That is the right analogy and that didn't rely on Rick correcting us with Mandy Patinkin or anything. You nailed that one. With that said, gentlemen, we're seeing each other of course this podcast is just audio so our listeners are not, but we're seeing each other and I would ask for maybe a little roshambo here, we're going to go 1-2-3, shoot. Whoever shoots the winning rock or paper or scissors will be the one who makes the call and the range for the stock and the other gentleman will be the one who makes the guess, as Brian said earlier. Are you ready for rock, paper, scissors? The first-time roshambo has appeared live on the Rule Breaker Investing podcast. 1, 2, 3, shoot. Both went rock. 1, 2, 3, shoot. I see Stoffel, rock, Feroldi, scissors, Brian Stoffel, you have earned the right to name the market cap for this particular company. Now, both of you are in a soundproof chamber and an Internet free. Even though you're using the Internet to access this podcast right now, I know you're not looking because that's always the key ground rule for the Market Cap Game Show. Question for Brian. Brian, what was the last time you bought something online? Have you done that recently? Is December a month that you might buy things online?

Brian Stoffel: Every day.

David Gardner: I'm with you there. Are you going to the same place to buy things every day or are you going to different sites every day?

Brian Stoffel: No, I go to Amazon every day.

David Gardner: A lot of people do, and yet not every company loses to Amazon. I think there's a broad perception that once Amazon shows up, you're in trouble if you're a competitor, but some companies I think are Amazon proof. The company I'm going to ask you to make a market cap call on has this ticker symbol. Its ticker symbol and its name. The ticker symbol is E-T-S-Y. The company is Etsy. Brian Stoffel, your best call on the range of market cap for Etsy, ticker symbol ETSY?

Brian Stoffel: This is one where I am at a disadvantage because I feel like Brian knows it better than I do, but I'm going to say that it is between 20.4 billion and 32 billion.

David Gardner: 20.4 billion on the low-end, 32.0 billion on the high-end. Brian Feroldi, is it inside the range or outside that range?

Brian Feroldi: That's a really good range guess because I know that Etsy's market cap has been fluctuating wildly over the last year and I haven't looked at the stock price recently.

David Gardner: That makes it more fun.

Brian Feroldi: Before you said anything, I was going to guess 20 billion. The fact that you said 20.4 billion and 30 billion.

David Gardner: Thirty two for the record if that matters.

Brian Feroldi: Thirty two billion. I must say outside, I'm going to say it's below that.

David Gardner: It was a good call and that's what we're counting on you guys for both of you, not just the one of the other. You both are bringing your Fool cells next week, as you did in late September. The market cap for Etsy, as we record this podcast is $28.94 billion. Pretty equidistant within the middle of Brian's range, really good call. I love this company, we've talked about it for years, it has been an incredible winner for Rule Breakers of course, but I have to admit, I myself had not been keeping up over this very volatile last month where a lot of things. Usually when we say volatile, it means they're dropping.

I found in Motley Fool context, but this very volatile last month where the company had to hit an all-time high, a month ago, about 310, it's 212 just four weeks later. This is a company whose market cap, as you guys mentioned, has really been shifting around and yet it's still near all-time highs. It's just down about a third from where it had been. If you'd been in June of this year owning the stock, you'd be quite happy to see it up from 160-212 though. That's some of the volatility of the stock market and the market caps, gentlemen, I really appreciate you giving us a sense of the game. If you tie coming up this coming week, I think we know how it's going to be broken. I hope it's not a tie. Let me turn to my forward-looking question now, Brian Stoffel, what's a wish, an interesting thought, or a prediction that you have for the year 2022?

Brian Stoffel: I know, David, that you are the eternal optimist and I love that because listening to you always makes me feel better. I like controlling my expectations. I'm going to guess that there's going to be something that happens in 2022 that is completely unpredictable, not to the order of magnitude of COVID. I think it would always be interesting to go back and listen to the podcasts from December 2019 or January 2020.

David Gardner: They are there.

Brian Stoffel: But I'm going to assume that most of the stocks that I own, which are high-growth tech companies, will not perform well and I'm doing that so that if that's what happens, I'm fine and if it turns out that they do really well, then that's icing on the cake.

David Gardner: I like that. You're setting downside in place and you could only be pleasantly surprised. I will say as somebody who's market call sounds like this every year, I think the market is going up next year. I do so always with the knowledge that I could be wrong and indeed one third of the time or so, I am. But Brian, I appreciate you saying that. It's hard not to have noticed so many of our Rule Breakers stocks, so many of our favorite companies really have sold off quite significantly over just the last month. Maybe if something like Etsy goes from 310-212 near the end of the year, maybe we're setting ourselves up for a pleasant surprise next year, but you know what guys, as you both know, none of us three cares too much about where exactly the market finishes next year or any given year because it's about playing the whole game, isn't it? Not just one question or in this case, this week, one tiebreaker question. Thank you for that, Brian Stoffel. Brian Feroldi, let me turn to you to close here. What's a wish, an interesting thought, or a prediction that you have for the year 2022?

Brian Feroldi: I have been investing long enough to know that I don't trust any predictions that I would make about what's going to happen in 2022. I'm just going to go straight for the easy one, which is a wish. I'm going to wish that COVID finally ceases to exist around the world and that my kids can go to school in 2022 without wearing a mask.

David Gardner: Wonderful. I hear you there and I know that's not a prediction because that's the way we talked about it. No one can really know, but that's certainly a lovely wish. We think about the kids and whether they were kids who were going to graduate like college kids, a year or two ago and never have that graduation or some of us who just had our experience radically change. Ages they'll remember. I know the history books guys will look back and they will make a big point of talking about these few years that we're living in. What I would say is, it's not about what was happening externally, it's what we did about it, it's how you and I behaved. I want to thank you guys for having been wonderful studying voices for Motley Fool members worldwide over the last couple of years through Motley Fool Live and a lot of other wonderful ways that you're reaching people through social media, etc. We three are all united that we'd like next year to be good. If it's not, we're OK with that. But in general, the reason we own stocks at all is because we think things go from the lower left to upper right over the only term that counts, the long term. Brian Feroldi, Brian Stoffel, thanks for joining us this week on Rule Breaker Investing for the Besties. Guys, you next week.

Brian Feroldi: Thanks, David. I look forward to it.

Brian Stoffel: Until next week, David.

David Gardner: Now, onto Bestie number 8. Company Culture Tips Volume 8, The New Normal first appeared on May 5th of 2021. Why did we do that podcast together? Why did I have my friends Kara Chambers and Lee Burbage on for an eighth time in this podcast, seven year history? Well, we were really trying to help entrepreneurs and business leaders. That's you and me, a lot of us think through the future of work. I think that The Motley Fool has distinguished itself as a small to medium-sized company that innovates within the space of company culture. We've been doing that for a long time. It's always been fun to have Kara and Lee come on and let you look over their shoulders, show their homework to you as we try to make the best decisions we can to grow our company. The intent was to help you think through the future of work and it's a big question, isn't it? That's why to me it was a significant podcast this year. 

That was courageous for us to think out loud about what the future of work might look like. It's something that's so important to all of us. If you're a working professional, it's important to you. If you are an investor trying to figure out which companies you want to own into the future going forward, thinking through how work will work, who's going to adapt well to that, what companies might be threatened if they don't do it very well, those things really matter to our investment bottom lines as well. It was great to have Lee come on. I remember he talked something about frequent communication to support that process of change. That's one thing we covered in the podcast. 

Kara came on and talked about, she's always full of frameworks. I remember the Pomodoro Technique which she was rocking, talking about sometimes if you're sitting having one Zoom meeting after another, maybe you need to get up and stretch from time-to-time. Every 30 minutes, you set a 25-minute timer and make sure as the timer goes off, that you step up away from your computer workstation or screen mobile phone, and take a little bit of a break and then return back to work. That was some of what we talked about, but this has been one of our most popular, longest running series. I think it speaks to relevance, our effort to try to be as relevant to you as fellow professionals and investors as well. Bestie number 8 to Kara and to Lee. The New Normal Company Culture Tips Volume 8. Let me welcome my friends back right now. Kara Chambers and Lee Burbage, welcome back to Rule Breaker Investing.

Lee Burbage: Thanks for having us.

Kara Chambers: Thank you so much.

David Gardner: Thank you both for that conversation we had. It's now seven months ago. It was May and a lot of ways, hey, that's just seven months. In other ways, seven more months where we're trying to learn as fast as we can month-by-month about what's the future of work will be like and there are a lot of implications to that. I want to thank you both, I highlighted it earlier, but for the courage that you had to come on and share what you're thinking about the new normal, what we're trying actively at the Fool. Again, it's the eighth in our series, our episodic series of Company Culture Tips. We've been doing this for years. Kara and Lee, thank you again. Kara, let me turn to you first. What's one reflection that you have now about that podcast we did together in May? 

Kara Chambers: I would say at the time, I was really into reading a lot of books and understanding how to work best and optimize and I think my reflection is we have about 600 employees right now and it's 600 different life experiences and jobs. I think it's just helping everyone figure out what works best for them. I was looking at last night, a company called Atlassian who set this up in terms of three different scales we're all on. One is our level of social support that we have around us wherever we are. The second is how many relationships we have at work, right? Sometimes, those two overlap, especially if you're at The Motley Fool. Your work relationships are your social support if you're lucky like us. Then the third one is, what's your household situation like? Are you on your own? Do you have space to work in? Do you share your home? Do you have care-taking responsibilities? As schools have opened up, that's diminished for a lot of people. But I think those three axes, everyone's in a different space on those and I think making sure you have that awareness around the people you work with. Most costly and for yourself of what support we all need to give each other is where I've been thinking about it.

David Gardner: Love it, Kara, and I know you were such a master of frameworks at our company. You're somebody who's distinguished yourself over the [laughs] years as just looking externally, reading books, and looking at other companies. In this case, a rule breaker. This has been a longtime successful pick of ours. Many Motley Fool members own some ticker symbol, T-E-A-M. But I'm wondering, Kara, as we scale, I mean, some of us listening to you right now have thousands of employees. I don't know how at that scale, you can manage thousands of different stories. On the other hand, some of us have hundreds of employees like us and some of us have tens or ones of employees. You're reminding me the importance of scale, and I guess part of that framework that you just shared is for a larger company, that allows you to bucket people up and have maybe nine different sets of employees that you can manage in a customized way. But it's hard to personalize beyond a certain point, am I right?

Kara Chambers: Absolutely, and I think this framework helps if you're in a small team. I think their guideline was maybe up to 12 people. That's a good way to build that relationship. Those smaller groups are going to be really important when you're in a bigger team. But if you're in a role like Lee and mine you're thinking about those interactions across the company and setting up programs. But for anyone out there listening, if you've got colleagues on a small team, it's a good way to think about that. You may know each other, buy now and understand that, but I think it's a good way to think about each person's support level.

David Gardner: Thank you for that, Kara. Let me turn to you now, Lee. Lee, what's one reflection you have now about that podcast we did together seven months ago?

Lee Burbage: Well, there's a lot of good stuff. I went back and listened to it. I think one thing that I may be underestimated was how boundary-less this new world is. It's something I've been paying attention to. We used to have a 9:00-5:00 and physical walls and doors and rooms that were booked. There were literal boundaries that divided up our day and how we interacted with people. Now, I'm not sure what those boundaries are and that's everything from when people are contacting me or how and that includes, as Kara would say in my family who's here in this house with me and can [laughs] they walk into this room at any time and talk to me. When does my dog know the rules and when to bark or not, right? I find myself and others I think still trying to navigate exactly when is the best time to talk to people and what are each person's individual boundaries. We don't have the framework that existed inside of an office building before in the ways that we used to. I think we didn't quite contemplate back then the challenges that were going to come from really setting up our new individual boundaries and when we wanted to work and how we wanted to work and how we wanted to communicate with each other.

David Gardner: That's a great reflection, Lee, boundarylessness. It does strike me that maybe we're moving into an age of more agency and more autonomy. I know that Dan Pink in his work talking about free-agent nations some years ago now, but it was about how a lot of us need to take more command of our own work where maybe a nation of free agents. There are a lot of contractors. In fact, we have more contractors at The Motley Fool than we have full-time employees. But I'm thinking about how in an age of maybe more autonomy, you really do have to be intentional. You have to think about creating real boundaries where none existed before.

Lee Burbage: I think that's spot on and as you said, it's so much more now is up to the individual to establish those boundaries for how they like to work and be contracted and so forth.

David Gardner: I wonder if there's going to be emerging set of new best practices that help people self-govern because not everybody has enough discipline in my case, or enough awareness or thoughtfulness to really know how to do it right. But I'm thinking maybe some self-governance, some principals put forward as best practices might be really helpful for the world at large. Well, that's just an idle thought. Let me go to my second and closing question. Lee, I'll go right back to you. Lee Burbage, what's a wish, an interesting thought, or a prediction that you have for the year 2022?

Lee Burbage: Well, something that I've been thinking about is, I think all of my interactions work-related now, there's an intermediary that is technology. There's always some piece of technology between me and the people that I'm communicating with, either verbally or in writing or so forth 100 percent of the time. I'm curious and excited for what developments are going to come in the year ahead. I think we're going to see some big jumps forward in technology beyond just the Zooms over the world that we're already using because that is such a key and important part of our lives now.

David Gardner: I love that what an interesting thought for 2022. It reminds me that one of my new year's intentions is to make sure I have you both back probably sometime in the first half of the year because one thing I wanted to do, Kara, is our greatest hits. We've now done eight episodes together of Company Culture Tips across a range of different themes. But I think it's time for the greatest hits, the best of our Company Culture Tips where I'll ask you and Lee to go back and find out of all of them. Because I think we've done lists of 10 each time, so I think out of 80 tips, which are the ones that are the best or seem front and center in 2022? There's an intention for me. Kara Chambers, what's a wish, an interesting thought, or a prediction that you have for the year 2022?

Kara Chambers: I will build on what Lee said about technology. As we all know, that's near and dear to my heart. But I think this coming year is going to be about choice and intentionality. When I see a lot of companies, their headlines are like, "You'll be required to come back to the office on Tuesdays and Thursdays." That's a top-down solution. Or companies that are trying to set core hours or things like that. That choice and flexibility of how and when to work and on top of that, what we're all using for what. Do we need to have a Zoom meeting for everything or are we going to Slack chat all weekend and all made about the thing [laughs] or should we get together when we can? Using what for what is going to be probably a big important lesson for us all to learn just and I said it, but just because there is a technology we can use doesn't mean we should. It's the right medium. That's where I'm thinking about it.

David Gardner: That comes from someone who's Motley, that's the value you bring to our company unless it's changed here, which it probably hasn't. Kara, there's an app for that. Do I have your Motley right to our member?

Kara Chambers: Yeah, absolutely.

David Gardner: You are somebody who clearly understands the importance of technology, specifically within our company culture and/or its workplace, but I'm sure outside of that as well. Kara, are you using any new interesting apps? Have you bumped into anything you want to share? In closing, might be professional or personal, do you have an app for you and me?

Kara Chambers: Right now, we've toyed around with Miro, M-I-R-O, on our team, which is an online whiteboarding app that's been fun to test out like that typical office experience of sticky notes on a whiteboard. I've shied away a lot from online whiteboards because I imagine it will be like Mac paint if any of you remember [laughs] like drawing on something on your computer, which seems so tedious. But really, they've got some cool features about sticky notes. We've been collaborating with the company in Australia. We're forced to do everything even without a pandemic and we've learned a lot of lessons on how to use that. I like Miro, M-I-R-O. That's been fun for us to use.

David Gardner: Thank you for sharing that, Kara. Lee and Kara, thank you for sharing all of your wisdom this year and every other, a delight to be with you both. Happy New Year to you both, the best of holidays.

Lee Burbage: Same to you.

Kara Chambers: Same. Thank you so much.

David Gardner: Well, before I get to number 9, I just want to mention, well it's actually apt for me to mention this now. That my friend Chris Hill has let me know that change is in store for Motley Fool podcasts. Well, I'll leave that up to him and the company to communicate. But it's enough for me now to mention two things. First, there's a major overhaul and new emphasis on Motley Fool Money as the flagship of Fool podcasts, that's number 1. Number 2, I do want to make sure you know that though I welcome change as much as the next human. In fact, Bestie number 9 coming up is an example. There will actually be no change in Rule Breaker Investing. This podcast two months from now should be just the same here as two months ago. I love doing this, I think you know that. Well, the ninth Bestie is one certainly close to my heart and it probably shows some of my hardest working moments of 2021, as many of you know and have known since at the end of May, I concluded my stock-picking career for The Motley Fool. 

Don't get me wrong. I still love investing just as much and keep talking about it here. The services I ran for decades, Motley Fool Stock Advisor and Motley Fool Rule Breakers have only grown since guided as they are by extremely bright people who've worked with me for years. For instance, Aaron Bush for one. In fact, it was my knowledge that I would be succeeded well, that enabled me to make this important transition earlier this year. That week and the day of May 12th, when A Road Less Traveled in 10.5 Chapters, Bestie number 9 was published. I did more hard work and soul-searching that week than any other week this year. In fact, as I thought, how will I communicate this, I have too many thoughts. Ultimately, the morning when we recorded May 11th at about 10:00 AM, I sat down in front of my computer and I just began writing. I wrote and wrote. I said earlier that 2021 Bestie winner 300, already discussed, was the rarest of podcasts where I wrote out the whole thing and recorded it as in effect an audio essay and I truly didn't know or expect that just two months later, that day, I would do the same thing again. 

I wrote the whole thing out. By the time I finished the essay, five hours later at 3:00 PM, I was ready simply to perform it, to read my first draft to you as that week's podcast. It was almost exactly one hour long, written out as an essay if we're double spacing and counting 250 words a page, it was 37 pages long. As I quipped shortly thereafter had I known the day before that I would need to write a 37-page essay to perform the next day's podcast. I never would have performed the next day's podcast. But that's some of the great work we do in this life. As Michael Bungay Stanier reminded us all on this podcast in August, "The work that we love to do enough the time stops." We're in the flow, and I was just inspired, I'd love to doing that podcast and apologies if this sounds self-indulgent, but I must admit that I've listened to it several times since A Road Less Traveled, which is what this is in 10.5 chapters. I still love to think about Chapter 2, which became Two Fools later, Frank Reich, or Chapter 6 I Made My Pencil with Henry David Thoreau, or Chapter 9 Bill James, or 10.5 Lead a More Interesting Life. Bestie number 9 is A Road Less Traveled in 10.5 chapters. 

Well, our 10th Bestie this year. Here we are, we've made it to number 10 and I want to say 10 asterisks first. Because the asterisk is, I think this might be one of the best sellers [laughs] of 2021, so many wonderful friends and voices, people I deeply admire. I hope that you've gotten to admire and gotten to know a little bit better as a consequence of their visiting in with us this week. Don't tell any of the other Besties, but this 11th, this might be the best show of the entire year, this one. Bestie number 10 was recorded on August 4th of 2021. Let it be known, by the way, August 4th, always remember because that was the day The Motley Fool debuted on America Online. It was August 4th of 1994 and 27 years ago on that day, we could not have dreamed what would emerge. We didn't even imagine we would never hire somebody like have an employee. It was just going to be Tom and Dave and our friend Eric answering some questions on AOL and so much good has happened since. It's a delight for me to think back to those days in August of 1994. 

But on August 4th of 2021, well, I got to share with you one of my favorite people in business. Really Shirzad Chamine and his message of positive intelligence is not so much even about business, it's about life. That's an area that Rule Breaker Investing often touches on and Shirzad does it as well as anyone. The aim of that podcast, well, it was Authors in August; Shirzad Chamine is positively intelligent. The aim of that podcast was to ensure that every one of my fellow Rule Breakers and listeners, every one of you would know the benefit of positive intelligence. I'm not saying we all need to be positively intelligent all the time. But for some of us, it's a real eye-opener to ask in a world that often asks, "What might go wrong?" Instead to ask, what if things actually went right? 

Or what if things went better than I could ever have imagined? That's true of the 27 years of The Motley Fool since our debut on AOL, it's not true every time, but I think part of Shirzad's work reminds us that you're much more likely to experience positive results and positive outcomes, if you're asking positive questions and wearing your PQ hat, your positive intelligence quotient hat, if those are the lenses that you wear as you walk around the world. Often when people talk about looking at the world positively, they'll use a phrase like, "Looking at things through rose colored lenses," and I think that phrase has a negative connotation when it's generally used by people, but I've always thought it's a wonderful. 

In fact, I once did walk around the world for one full day with sunglasses that happened to have a rosy lens and I was like, "Wow. Everything looks amazing. It looks so much better than it does without these rose colored lenses on." Maybe I started to see if you look at the positive for the beauty around you, maybe not only will you have a better time, but you might end up in a better place. The aim of that podcast was to ensure that you, dear listener, heard that message from somebody who's given a very thorough look at it. If you go back and listen to that August 4th conversation with Shirzad, you'll give a very thorough look through the many frameworks and the key thoughts that Shirzad has for you, somebody who himself started in the hardest of places as a religious minority in war torn Iran and came from there all the way to Stanford Business School. You talked about underdog stories. But Shirzad who then went on to learn as an entrepreneur and a professional that he could look at life better and how that transformed his life and how it can transform yours as well, certainly has benefited me and my friends and relations greatly by extension. A thorough look through the many frameworks and key thoughts or what you're going to get from PQ reps, if you don't know what that is, listen to saboteur that make up his positive intelligence framework. I will mention, it's not the only time he has been on this podcast, in fact, October 21st of 2020 was his first appearance on Rule Breaker Investing. At that point, I was reacting just to a personality test that the offers for free at his site positiveintelligence.com, but I hadn't actually read his book, his New York Times Best Seller, Positive Intelligence. 

This year, I did, and that's why I had them on Authors in August. The focus of this year's podcast, much more a look at the book going through his book, as opposed to the partner podcasts, you can listen to in October 2020, which was more storytelling and his own story. But anyway, I think the significance of this podcast and why it deserves a Bestie, it's because I think it's Foolosophy. It's very concordant with how we think at The Motley Fool, capital F, Foolosophy that we want to share the world over and in particular, Shirzad gave us a weekend extra that you can go back and listen to. This is an evergreen experience. He talks you through a short meditation that you can do anytime you want to look at things a little bit more positively, make the world slowdown around you. It was August 7th, therefore, it was entitled extra PQ reps with Shirzad Chamine, 12 minutes and 14 seconds, you can go back and use yourself. But why talk too much about the past when Shirzad Chamine is here to join us as our final cameo guest star on our Besties epic year-end extravaganza. Shirzad, welcome back to Rule Breaker Investing.

Shirzad Chamine: My pleasure, I've been looking forward to this.

David Gardner: I want to thank you. First of all, you express gratitude about as well as anybody I know and I've heard you do it a number of times, both in person and through your writing and I know the importance of gratitude. Indeed, earlier this month I did an entire podcast dedicated just to gratitude. I should start by thanking you for all of the work that you've done which has touched my life, the lives of many through this podcast. Just like Jefferson's candle, you can like mine, I can light yours. Nobody is the poor that we shared ideas with each other and shared them out to the world. Thank you for making a big difference in the lives of many listening. I'm just delighted to have you, the Positive Intelligence genius back to the Rule Breaker Investing podcast, Shirzad, thank you.

Shirzad Chamine: My pleasure.

David Gardner: The first question that I've been asking each of my return guest stars is, what's one reflection that you have now about that podcast we did together? Now, you and I have done to podcast. We did speak in August of this year about your book and that's really what I'm thinking of. But we first did meet in October of last year when we talked about saboteur a little bit more your personal backstory, etc. Any reflections you have about those times would be valued.

Shirzad Chamine: Yeah. What really I remember most is that I get interviewed a lot and typically, the person who is doing the interviewing, it's just an interesting podcast and they move on. What I remember most from our last session together is you had actually walked the walk, you not only start practicing these principles, but you brought your wife, Margaret, into the practice too, you brought her into your home. What's struck me was that you really are a Seeker and you do apply yourself to the wisdom that you're bringing to this work and that just inspires me. When you talk about gratitude, I'm grateful for you modeling the work that we do rather than just talking about it. As we know, modeling this means actually working on building up your own muscles. That takes time, that takes commitment. It's not just about reading something or listening to something. I was very touched that you had actually done that, invested in that, and so it brings me a lot more pleasure to come back to you and talk to you and say, "So how's it going? What's the impact?"

David Gardner: [laughs] Thank you, Shirzad. Part of the work that some of our listeners certainly have gone on to do inspired by the conversations you've had on this podcast. They can download the Positive Intelligence, the PQ app. They can start a program with you of six weeks, which I've done. But one of my great learnings of this year was after I completed the program earlier this year, the app keeps working. It's like you thought you paid for a six-week course. But then the teachers there are with you on the seventh week and you can wake up as you did to me this morning in the 38th week and you are still providing some good perspective and advice throughout the day. It's a real gift. It was not something I was expecting, but it's been a pleasure Shirzad. Yes, I'm certainly a fan, a listener, a practitioner. I don't want to hold myself out as great model than anybody else. We're all just muddling through, aren't we? But it's been a real pleasure and you told me just before you came on the air, we were talking and you described how you'd missed meeting people in person. A lot of us, of course, have been hold up for the greater part of two years now. But you got back out recently to, was it a conference you were speaking at?

Shirzad Chamine: There was a conference in Las Vegas the very first time I went to something in person. The very first person I met in the conference show said, "Shirzad has saved my marriage," and I said, "Well, that's delightful to hear. How did you do that?" He said, "I was separated from my wife more than a year ago and when I looked at your work and became aware of my saboteurs, I realize that saboteur is the one that sabotages me, was the stickler and stickler is the one that's constantly nitpicking of, 'What's not perfect? What's not right with the other person? What I realized is that I had destroyed my marriage, through my stickler saboteur, so I went back to my separated wife, I took complete responsibility for all negativity in our marriage, and a year later now, we're together and happy.'" It was just really charged up my batteries at the very first person is taking about such kind of impact, [laughs] we read about it every day and it was just wonderful to actually look into the eyes of somebody. This work does indeed save marriages, it affects the kind of parent that we are to our kids. It affects the human being that we are, day-in and day-out in this crazy thing called life and this very challenging thing called life. It gives you the mental muscles to guide your path in a positive way.

David Gardner: Yeah, and as I said earlier and I have said in the past, it's often about asking things like, "Instead of what could go wrong, wait, what if things actually went right? Or what if things went even better than that?" For a lot of us, it's sometimes hard and we often see negative headlines and we hear about Omicron and the list goes on of all of the worries that the world has for us and yet in my experience anyway, most of the people who fix those worries, most of the people who look past them are supporters or help us are the ones who think it can be better and we can make it better. But for a lot of us, and I know from early childhood with our survival mechanisms, we don't necessarily do that well as adults. Often we're kicking at ourselves as opposed to trying to prop ourselves, or in this case, our spouse or wife, what a conversation that was up instead of knock-on everything down.

Shirzad Chamine: As a matter of fact, what we talk about is that every human being is a mixed bag of extraordinarily view sage. The positive self and some really nasty stuff. That's the negative self. That we call the saboteur. In our job, the work that we do is to bring up your positive self we call the inner Jedi and acquired the negative self that got the inner Darth Vaders. Also, we realized that as we do that with ourselves, it affects everybody in our lives. So in your marriage, the question is, are you bringing out the worst in each other or are you bringing out the best in each other? Because this stuff is contagious because of neurons in our brain. If you are in your negative mind, it's actually bringing up the negative in your spouse, and then spirals on itself. What we get to do is not only learn to bring out the best in each other, but also in our partnerships, in our relationships with our kids. We also realize that this is a mental muscle that takes daily practice rather than just an insight. What I would encourage everybody to actually learn how to practice the positive muscles of your brain every single day.

David Gardner: I think there are two types of people listening to us right now. The first type is the person who heard you on this year's podcast or maybe last year's podcast, and is reminded of some of the eternal verities and some things that they're already doing well, or some things they need to get back to. Then there's a second type of person who's scratching their head going, "What is he talking about?" We're not going to fully answer that now you are doing a pretty good job succinctly summing up some of the key points, but of course, they're frameworks behind this. There's a New York Times best seller behind this positive intelligence. It does make me wonder before I ask you my final question, Shirzad, what are you working on these days? What are you looking forward to in the year ahead?

Shirzad Chamine: We have trained now about 15,000 coaches around the world, who are taking this positive intelligence framework to very different applications. A lot of them are executive coaches, but some of them are actually working with six year olds, and telling us that even a six-year-old can be taught. That, hey, inside your brain there is a real positive one, there is a negative one. You can develop mastery over what in the world happening inside your mind. You can trust everything that happens in your brain. Our coaches are telling us six-year-old are getting these concepts and it's making a big impact. Some are taking it to parenting and we're taking it to wellness, some are taking it to help with trauma, and so our coaches are taking this into every arena of personal and professional development and wellness. That's incredibly inspiring for us so that my big thing for this coming year is how to keep empowering our coaches from just about every country on earth to be bringing this life changing work to their own constituents.

David Gardner: Well, and it truly is universal. It is truly human and I'm delighted to hear that you are just spread your wings even further, and trying to reach as many people as possible. Certainly, through a network of coaches, each coach is probably tied to somewhere between 10, and 100 other people. I can see the excitement in your eyes as you think about where this is all leading and I'm excited to live in that world as well. Let me close not just this talk with you, Shirzad, but in some ways, this entire Besties year end extravaganza, by asking you the same question I've asked each of my cameo guest stars, Shirzad Chamine, what is a wish, an interesting thought, or a prediction that you have for the year 2022?

Shirzad Chamine: The person who inspires me greatly is Gandhi. Gandhi's famous saying is be the change you want to see in the world. I want us to look at the fact that nowadays, we look at the world, and what we are unhappy about very often is that there's a rise of negativity. There's a rise of price of polarization, of hate, of negative emotions. The interesting thing is that, if you look at it carefully, that causes some negativity in us. That's causes some upset in us, that causes some stress in us. Because we can't help it, react with negativity, which means we're actually adding to the negativity of the world. What I want to remind us of is let's be the change you want to see in the world. If you want to see more positivity in the world, the question is, how do you react to negativity with positivity. 

The way to do that is actually this mental fitness work we're doing, which is you intercept the automatic negative reaction that you have the negative stuff. You intercept that you shift your brain activation to where you can be a positive inner Jedi, and ask yourself, how do I convert whatever is happening, even bad stuff into a gift and opportunity for myself, for my love ones, for the world? You get to intercept the automatic negatives, the negative reaction, and shift to your ability to actually take anything negative and convert it into something good for the world. In that, you've done to come to change you're want to seen the world. You become an element of injecting positivity, not negativity. I hope that you get to actually practice that because it's quite profound and life changing when you do that.

David Gardner: I'm going to call that both a wish and an interesting thought. Shirzad Chamine, thank you so much for joining us. Once again at the end of 2021 not at the end of all things. In fact, it's just the beginning of the next things, 2022 and beyond. Shirzad, best wishes to you, and happy holiday.

Shirzad Chamine: Thank you, and best wishes to all of you. Let's go practice our positivity for the sake of the planet.

David Gardner: There they are, the Besties of 2021. I skipped one podcast I've done annually this year. What have you learned from David Gardner, which long time listeners will know as my annual birthday present that you all have given to me and it won a Bestie last year, and truth be told, these have been some of my favorite past episodes every year. It's a gift for me to hear, what have you learned from me? This year though, particularly in May, I learned a lot from you. Reflected back and notes of support, encouragement, Mailbag Stories. The list goes on, and it is a road less traveled. Stepping away in one's prime toward other, I won't even say greener pastures, just other pastures. The new world, not the old world. New coastlines. 

The greater you grow your island of knowledge and experience in life, as we've said, the longer your coastline of mystery gets. Well, that week, like closed out my operational responsibilities in May, that week, and ever since I got into my little boat, the new boat, and cast off. I think back on that day's podcast with fondness, and I gave you the Bestie, Bestie number nine, but most of all, I continue, I hope you do too, to look forward to the future. This podcast continues to be and remains such ballast for this little boat, this ship of Fools and a joy to continue to share with you every week. So 2015, '16, '17, '18, '19, '20, '21, with never a week off. Rick and Fools, 2022, let's go and beyond. What we've celebrated the past this week and brought the past in many of its gifted voices into the present, right here, right now. Besties, but I, and I trust you, will keep our gates fixed forward on the future on the only term that counts in a short-term minded world, and that's the long term. To the future. Thank you. Besties. Fool on!