Mastering the Art of Spending Money - Morgan Housel - #1055

**Chris Williamson** (0:00)
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You are my favorite writer.

**Morgan Housel** (0:31)
Thank you.

**Chris Williamson** (0:31)
You have the most insights per word of anybody that's writing stuff at the moment.

**Morgan Housel** (0:37)
Well, thanks. That means a lot to me.

**Chris Williamson** (0:38)
Thank you. You could have chosen to write about anything. Why choose to write about spending money?

**Morgan Housel** (0:45)
Well, I'll take it back to the start of my career, which was like a lot of young men, particularly in the mid-2000s.
The ultimate goal before tech really existed, the ultimate goal was being an investment banker on Wall Street. It's hard to remember that era because now if you're a young person at Stanford or whatever, your goal is like go work at Google, go work at OpenAI. Back then, it was all go work at Goldman Sachs. My sole life aspiration when I was 20 was to be an investment banker or a hedge fund manager. I knew I loved investing. Even at that age, I used to go to Barnes and Noble and read investing books. I loved it to begin with. I was fascinated with money. Then, I haphazardly got a job as a writer. Because I graduated in 2008, the economy was a wreck and nobody was hiring, no banks were hiring. The only finance job that I could find was as a writer for The Motley Fool. Didn't want to be a writer, hated writing, was embarrassed that I had dreams to be a powerful investment banker and now I was a journalist. I was like, I hated that. But I actually pretty quickly fell in love with it. What I loved about it was I loved being an outsider who was not being influenced by the incentives of that career. If you are a hedge fund manager, you have a lot of incentives and biases based around that. If you are a financial advisor, there's a lot of just you have to think a certain way to fit into that profession. I felt like as a writer, and I'm not a journalist. As a writer, I could just be on the outside looking in. I felt like I was just up in the bleachers looking down and be like, let me try to figure out what's going on down there.

**Chris Williamson** (2:19)
Only if you said the play is on the pitch.

**Morgan Housel** (2:20)
Yes, and then tell a story behind it. To me, money, I got lucky because money, I think, has more fascinating social stories in it than almost any other field, where how you spend money and how you save money and your ambitions are such a window into who you are. Of course, there's a lot of other things in life that are more important than money, family and purpose and whatnot. But money is a very clear window into who you are. I feel like there's just an endless well of interesting stories to tell about it.

**Chris Williamson** (2:50)
What can you tell about someone from the way that they spend money?

**Morgan Housel** (2:53)
So much of it is about your ambitions and who you think about yourself. I'm not anti-materialistic at all and I really don't judge other people. But when I see somebody driving a yellow Lamborghini, I'm like, there's a story there. There's a story there and it's not a judging story, but that's a story of who you want to be and what you want to show off. Now, some people have expensive cars because they love the craftsmanship and the engineering and whatnot. They're truly doing it for- Which is still a story. It's still a story. But whenever I see someone clearly peacocking, and there's a lot of it, you see it, there's a story in there. I found this headline from 1929, which was the peak just before the Great Depression. It was such a good headline. It was in the Washington Post. It was, the more you are snubbed while poor, the more you enjoy displaying being rich. It's almost like you don't even need to read the article. That's it. That's so astute and I think so true. That for a lot of people, not everybody, but for a lot of people, the more you are showing off or you just desire to show off, a lot of it is a wound that was inflicted upon you and you're like, I'm going to get back. And sometimes too, you're not even showing off for other people.