Kill Your Idol

Tony Robbins just published a book about investing that is a not-so-hidden pitch to bring revenues to a Private Equity firm he’s a shareholder. Nick Maggiulli wrote a review that exposed the fact.

Nothing out of the ordinary, you would say?

Nick Maggiulli is a famous (? Can we say that? Not sure what’s the reference these days) blogger but, more relevant, he also wrote a book that sold 200k copies, a big success for a non-fiction author.

The typical marketing process for a new book contemplates the sharing of early copies with other authors. While it is not written anywhere, the expectation is to receive back praise; when that is not achievable, for whatever reasons, maybe just a polite silence.

What Nick did is atypical because there is a trade-off and, rightly or wrongly, the side he chooses is usually the one that comes out short at the end. The positive for him is that he gained credibility points out of the financial community (a marginal gain, considering his starting point); the negative is that he pissed off lots of people, not just Tony.

By breaking the norm, the risk a publishing house would put on a future bad review from Nick is now <>0; so who would bother to involve him again? I bet you never picked a book at the store, glanced at the back and said “oh shit, where is Nick’s review? I’m not gonna buy it”.

It’s like the whistle-blower that points the finger against their employer: good for society, bad for them. Good luck finding another job after that stunt (unless you are that rare superstar, obv). It’s like the Jerry Maguire plot, with the only difference being that is not a comedy but a tragedy.

We live in a world where I rub your back today and I expect you to do so to me tomorrow.

Do the right thing

Nick did the right thing, no doubt about it. He demonstrated to have the proverbial spinal cord and be able to keep his back straight.

What surprised me the most is that it came from someone who works for a shop, Ritholtz Wealth Management, that was born with the idea of gathering men with that spirit…and turned into something more pragmatic.

Josh Brown is a veteran of the industry (even if he’s slightly younger than me). He knows well the advantages of exposing the garbage but, more so, the power of keeping connections. You want to embody the idea of being the guy that turns the carpet but at the same time, better to keep the number of carpets upside down pretty lean.

You know, the guy who can say that Trump is dangerous but let’s balance it with a joke on Biden’s mental capacity…just to be sure I do not disappoint anyone. Like if being someone actively promoting the lynching of people is somehow comparable to issuing an inflation-taming act that is designed to achieve the opposite. Sure, if your personal risk of being killed/harassed/discriminated against is negligible, inflation is pretty annoying.

But nobody’s perfect, me included! Love you, Josh.

From time to time, I test myself in a “what would I do” game.

A year ago Josh interviewed Michael Rapino, the CEO of Live Nation (and Ticketmaster). If I remember correctly, he mentioned they are also friends “outside the office”. I consider Ticketmaster a toxic company: they built a monopoly-like position and they are using it, to the detriment of consumers. Ok, I am not that type of snowflake, it’s capitalism bla bla bla…but if I had the opportunity to interview the guy, I would probably skip it. To not turn it into a celebration of a guy who is definitely doing right for his shareholders but a bit less for society as a whole. As Josh did. I mean, Ticketmaster didn’t create an amazing, innovative service; they conquered a sort of niche market and they are now acting as the autocratic leader of a commodity-rich underdeveloped country.

One of my best friends manages a couple of active mutual funds. When I first arrived in Luxembourg 17 years ago, the people I hung out with were PMs at a small Italian mutual fund shop. They are still there and yes, it is one of the shops I criticise here on the blog and on Twitter. They are great human beings (especially my best friend) but…let’s say you won’t see me interviewing them. Even if they are the first to complain about the fees charged by their funds (they have to beat those fees, plus the benchmark, to get a bonus). You cannot do an interview without addressing the elephant in the room.

It gives me the same feelings as CEOs of cigarette companies who smoke while presenting at Annual Meetings. And I tell you as a person who smokes.

Animal House

Josh did that interview with his pal and co-worker Michael Batnick. The same Michael that for several episodes of his podcast, Animal Spirit, went on a rant on how egregiously bad ticketing companies like…Ticketmaster. Must have been great to have the opportunity to express your frustration in front of the CEO of Ticketmaster and…only demonstrate that not everyone at RWM has a spinal cord…I guess? Yep, no Mike dropped during that interview.

I still remember when I listened to the very first episode of Animal Spirit, I was on a transfer bus doing a surfing tour in Costa Rica (ah, the life before kids). That’s how special Animal Spirit was for me. Especially when they introduced the Talk Your Book spin-off, because that was my dream job: interviewing people behind innovative and ‘weird’ financial products.

Unfortunately, they turned it into a pay-to-play vetrine. I agree that for some products the line is very blurry: even if you know the investment might lead to bad behaviours, sometimes it is so popular you have to talk about it. But at least do it while stressing the issues. That should be your role…not hiding behind a (very tenuous) “retail investors love it and sometimes they have not-so-rational utility functions that make it ok”. It is not ok.

There are also few follow-ups on products, those paid by the products’ sponsor (survivorship bias FTW). Years ago they presented an ETF that was supposed to track the ‘housing market’ and (ideally) represented a good investment for people saving to buy a home. The product failed, unsurprisingly, in its tracking objective and the ETF was closed. These things happen but a post-mortem type of analysis would be interesting, if not just required. Something, you know, to send the message that the ’service’ is for the listener, not for the seller.

The animals are still there, unfortunately the spirit was lost along the way.

The other day I was debating with Giovanni, my YT pal, what we would do if we receive a sponsorship inquiry for a product that has nothing to do with finance, like…cat food. Would it solve the “responsibility” issue, since neither of us is a cat food expert? Considering that the shot would be embarrassing (try to mimic a random TV ad in front of the mirror if you do not believe me), where do we set the price for it?

What are the risks? Can we quantify them?

I would be really curious to see how the Monday-Talk Your Book metrics compare to the Wednesday-standard Animal Spirit episode ones. If and when the two start to diverge and by how much?

I have so many threads open on this blog, posts that require updates and follow-ups, that I cannot objectively point the finger at anyone. But I justify myself thinking that this is nothing but a side of a side hustle for me. Weak…

It is normal to outgrow your master and move on. I shouldn’t be surprised by the fact that I am drawn towards other ‘characters’, it happens. I took Nick’s post as an opportunity to write about this but, as you might have hinted, it is something in the making for a long time. I will betray a big % of the 3 assiduous readers of this blog in the future as well, because we all change. Just be sure I will consider it 100% your fault.

What I am reading now:

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