Talking Billions with Bogumil Baranowski

Scarcity, Trust and Attention

Bogumil Baranowski’s Talking Billions podcast is unique, not so much because it’s about money, but because it uses money as a lens to frame meaning. Bogumil is disarming, softspoken and charismatic, and that means I have no recollection of what we’d talked about last month, until the video dropped today.

Here’s the video, and also, a bunch of nuggets I wanted to expand below:

Scarcity

"I definitely ended up with a scarcity mindset." - (5:04)

Nobody likes hearing anyone’s “farm wisdom” B.S. from their hardscrabble childhood, and as a white-kid from New England, I have missed few meals and have always found a roof. But money left its hollow mark in me, and I ignored that most of my life. Wanting, having, needing, obsessing, making, spending, lamenting or just thinking about money has occupied me a lot. I’m trying to reframe that for myself.

Peter Koenig (Econ elder) says money is an “inspirational element - “A client paying me, if things are working well, will receive inspiration through paying me as I will in receiving the payment … that’s what I call Love.”

I have not gotten there yet, but I see it in the mist. I see that money can be a tool for love, and I understand having a relationship with tools. I can pick up my grandfather’s 90 year old hammer and I know what it has done and can do, and I appreciate it. I may even form an attachment to it from the stories I tell myself about it. But I doubt I will ever love the hammer in the same way, with the same valence and amplitude, with the same bilateral exchange as I do a person.

Scarcity robbed me of some of that appreciation. It robbed me of some trust. It put blinders on me, and as often as not, I mistrusted the toolness of it, like a hammer with a wonky handle.

The Why

“We all use the tools of finance to advance our objectives. What it comes down to is why.” (9:53)

After savaging a levered-MSTR-income product last week, I feel like reiterating that there is nothing inherently “evil” about leverage, or options, or Bitcoin, or Bitcoin-treasury companies, or any other tool. What firms and individuals do with those tools, and why they use them, actually matters.

I’m naive enough to think that you can take two products that have almost the exact same pattern of returns, and recognize they have different emotional, personal, political and yes even moral implications that matter. A product like TCW’s $VOTE, which is all about direct engagement, voting and shareholder transparency, is actually a different thing than $SPY, even if the pattern of returns is almost identical. The how, and the why of a thing matter.

This seems important for the global political environment too. (Social)media is swamped with folks saying “well, I hate how we’re doing it, but someone need to {constrain China, re-shore, close the border, bring down drug prices, cut spending}.” There are good ways and bad ways of doing things. The good ways tend to not just work better, they preserve the soul of the thing being done. We — the ETF industry, the USA, you pick — has become less trustworthy less because of the what, and more because of the how and why.

Capitalism & Private Markets

"Capital markets are largely the casino where real capitalism cashes out." - 25:20

It’s a nice little rant leading up to this quote, but I keep coming back to this core problem with the now. I’m a capitalist! I think market capitalism is an amazing system that can achieve all sorts of societal objectives. I also think the current U.S. market environment leaves capital-C-Capitalism to private equity and the U.S. shadow banking system (Private Credit). These are bugs, not features.

At the core, what it means to be “public” is going to have to change. Whether that happens in a controlled way (congress actually passing laws, like we’ve done for every other market structure change in U.S. history), or whether it happens through spontaneous disassembly (which is the path we’re on), is a societal choice we’re making without even talking about it much. “Opening up Private Assets” is not a solution, it’s a white flag.

Meditation for Investors

“Meditation gives you tools in the space and the acuity to recognize your own internal monologue… as different than reality. That’s the thing I think most investors don’t get. Your perception of things is inherently, and always, not reality." -35:50

If you want to be better at almost anything I can think of, having a sharp mental model of the world is important. You wouldn’t start your trading today without looking at the news, your charts, or your account balance, would you? Meditation is nothing more than brain-training for reality.

Once you start, you might find that there are lots of ways in which your beliefs about reality, your self, your body, your mind, or anything else are not what you thought. But even if all you want to do is get rich from degen crypto trading, I suspect you would still probably benefit from a practice of some kind.

You go to the gym. You do the workouts. You drink the probiotics. Give your brain the same love.

Success

“Success is having control over my own time.” 1:02:35

Bogumil often asks guests to define success, or wealth, or happiness (check out his interview with Dan Crosby!) And it’s not surprising that so many guests give the same answer I did. Time.

My friend Cameron sent me a few stanzas for a speech she was working on last week: Longfellow’s Psalm of Life, which is a banger. This weekend, I read the whole poem, and an entirely different part stuck out for me than for her (which is why Poetry is awesome):

In the world’s broad field of battle,
In the bivouac of Life,
Be not like dumb, driven cattle!
Be a hero in the strife!

Trust no Future, howe’er pleasant!
Let the dead Past bury its dead!
Act,— act in the living Present!
Heart within, and God o’erhead!

It may not seem like we get to choose. That we’re stuck with our debts and obligations and our karmic baggage. There’s some truth to that.

But we get to choose the How and the Why. We get to choose not to be like dumb, driven cattle. We get to act in the living present, heart within, and God o’erhead.