He Lost $157,000 in 3 Minutes | Jack Raines on the Lesson Winning Never Taught Him

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Matt Zeigler (0:28)

You're watching Excess Returns, a channel that makes complex investing ideas simple enough to actually use where better questions lead to better decisions. I'm Matt Zeigler and what can I say? The young thug of finances in the house. You know I had to pick up the phone, baby. This new book, Young Money, a field guide to wealth and purpose in your 20s, is so ridiculously good. I had to say, let's get together and talk about this. Jack Raines, welcome to Excess Returns.

Jack Raines (0:52)

Matt, thanks for having me.

Matt Zeigler (0:54)

The 10-gallon hat is only on the picture behind you, not on your head. Should I be disappointed? All right, let's get this right.

Jack Raines (1:06)

We can rock it. It gets called out. I've gotten too many times, hey man, where's your cowboy hat? I'm on a Zoom call, so I keep it easy access if needed.

Matt Zeigler (1:14)

I would accept nothing less in this interview, so thank you for adorning the cap. Just to confirm, this is the only conversation about the book that you're having in public. This is all exclusive content. No one should bother to look up anything else except for- Yeah, correct.

Jack Raines (1:28)

I've not spoken about my book at all, and I've not marketed it any, right?

Matt Zeigler (1:32)

I didn't think I saw a breath of this on social media yet, so thank you for this exclusive.

Jack Raines (1:38)

Happy to be here. I mean, dude, this is like, it's chatting with Matt, and it's the New York Times exclusive. That's the order of media hierarchy in 2026

Matt Zeigler (1:48)

From your mouth to some god's ears. All right, trading advice first. You open up the book by saying, every young person should blow up their life at least once.

You've kind of done this more than a few times. Give me the finance angle, give me the philosophy angle of blowing up one's life.

Jack Raines (2:04)

I mean, the finance angle is I was trading SPAC warrants in my Roth IRA. I'm going to assume the majority of people listening to this are somewhat familiar with SPACs and are familiar with the boom bust of SPACs during the pandemic.

The book quote is more of a life philosophical take, I actually think it's a very good personal finance take too. I think when you're, well, I'll explain what I did. I turned six grand into 400 grand trading SPAC warrants in my retirement account. In 2020 and 2021, the SPAC trade stopped working, mainly because everybody and their mother was launching a SPAC because there's so much money going into SPACs. When Shaquille O'Neal has a SPAC, former Speaker of the House Paul Ryan has a SPAC, and a bunch of other random celebrities have SPACs, it's probably a bubble, kind of like when Snoop Dogg launched a cryptocurrency that also marked the top for crypto. Similar thing with SPACs.

I did not lose money when the SPAC bubble popped because I was good at trading SPACs, but I had turned six grand into 400 grand. I was pretty sure I could turn 400 grand into a million, and do six grand to a million in about a year. If I really hit a couple of good swings. When you're up 6,000 percent, you only need to make another 150 percent to be a millionaire. You think it's pretty doable.

I went all in on a buy now, pay later small cap that had gone public through a SPAC, but was no longer a SPAC. I thought they were cheap on a multiples basis compared to competitors. What I did not realize is if a company is cheap, and they miss earnings bad enough, they can get 50 percent cheaper, and it did, and I lost about $160,000 in a day as a 24-year-old, and I stopped trading, at least speculating after that. All that being said, I learned a ton, right? Like you throw money, there is no professor like Mr. Market when it comes to, you can read about boom-bust cycles, whatever, like 1873 about the Rothschild, great book, it tells you about the boom-bust cycles and like the Austrian startup and real estate markets, cool. I could really resonate with that, having turned, you know, you make hundreds of thousands of dollars and lose it, it's like, man, this really hurts your soul. If it happens to you when you're young though, it sticks with you for the rest of your career, and it's not that you'll never speculate on stuff again, but once you've had something blow up in your face, you know how that feels, you're just not going to put yourself in a position to ever experience that again. It's like if I was ever shot by a gun, I would probably avoid getting shot by a gun in the future. It feels like that. So I think, especially for young men, I think the best thing that can happen is like lose a decent sum of money when you're 24, because you have all the time in the world to earn it back. You probably won't have that much to lose to begin with compared to future earnings, and you're not going to derail your life then, like you will if you've never lost money, and then you get a sports gambling addiction at 34 or whatever when you have a three-year-old. So young people, my counterintuitive financial advice is most young guys should have like a $6,000 if this blows up fine account, and then just see what happens with it. I think it would produce a lot of learnings that would protect them over the course of their life.