3 - Bond Market Carnage

tumultuous times. As we're recording this this morning, I believe the this this month chancellor has reversed the not budget of a week or so ago disastrous evidence that the markets are very scary, especially the fixed income side of things, bonds, and so forth. And this will be impacting all of us, and certainly our clients and their behaviours, which is why we're the real advisor podcast because we focus on what

actually matters. The investor was not the investments, car, what's happening with you, and how are you approaching the scary markets? Just talk us through your your your point of view on this?

worried. Number two to reinforce and talk again about exactly why we set up our investments our pensions the way we did. And yeah, look, I think back to Alan's point at the previous episode, you know, to maybe talk about investments a little bit more than we normally would. And I think that that's important

right now. So what what I'm doing and what we're doing here at Mattis is, I have throughout this year, actually, I've done a couple of videos, which we sent out directly to our clients, to our to our Newsletter Lists and all sorts of lists. Just to talk about, you know, look, we've been here before, this isn't new, it won't be different this time. And I use actually Andy's wall of worry chart, I think it's really, really good. And he's updated as well, you know,

for this year. And I think it just goes to show that if you look to the long term all at the time, then, you know, that will give you some comfort that yeah, we have been here before, it's not going to be different this time. But actually, what we've done as well as we've done two other things as well as the wall of worry. And we've just, we're going to put up the dimensional chart whereby they show the word allocation funds and the various returns over one over three over

five over 10, over 20 years. But also they show, you know, what's the largest one year loss from a 6040 phone or a 4060 phone or whatever. And I think it's important, you know, to show people that this has happened before. And look what's happened since then if you look at, you know what happens over, when you look to a 10 year time horizon, you know, that the results will kind of come through in the end.

So really, I suppose what we're trying to do is we're trying to encourage people as much as we possibly can just just sit in their seat, do nothing and just stay the course and stick with the plan. As we say. The other thing is, we came across a really good chart, which we might put in the show notes, which is the the average returns for the stock markets, when you know markets have declined by 20% by 30%. And I'm just looking at the numbers here. The the average return the year after

20% decline is 22%. And the average return and the year after a 30% decline is 23.8%. So I think it's really really important to be you know, giving people these, this kind of data and for us and I did say it last time, you know, it's definitely getting a lot more into the nitty gritty of investments of mine. Kids have, I suppose have given given people content to give them some comfort. And I think that's really, really

important. But look, I just wanted to, I suppose, bring this point up this morning to, to acknowledge that it's scary. It's scary for us too. And every morning, I come in, and I look at the assets under management, and it's just going one way at the moment. But to understand and appreciate it's a temporary market decline, and it's easy for us as professionals dealing

with it. And I suppose within Metis, for me to talk to my teammates, and we kind of reassure each other, but if we're feeling like that, well, what are the what are the the unprofessional? So the people who are running their business, our clients, right? What how are they feeling and just to acknowledge that it's okay, but very, very interested to hear what you guys might be doing.

And I'm sure all of our listeners and viewers will be interested to hear wash, you know, what other tactics can be employed, to try and keep our clients. You know, give them some comfort, but keep them in their seats so that they don't make that big mistake, which is basically bailing out when there are temporary market declines like this. Andy, what what what are your thoughts on this?

down 9.3. Obviously, they're the very unimportant numbers, but they're the numbers that our clients, you know, a told, obviously, during these times, because they have to report obviously, the recent numbers, I think it's everything we do is, you know, client focused financial advisors, it's not as if we're reacting to this stuff. I mean, we've got to live sleep and breathe this the moment we take the clients on, you know, Tee them up for it during the good times and the bad times.

But yeah, 2022 is certainly turning out to be an interesting year. It's great news, obviously, for our clients that are investing every single month. Again, they can't process this, they can't intellectualize this, but again, they're buying units, they're not buying stock market prices, but all they are told is the prices that they never look at the units that

they're buying. So it's good news for people that are investing every single month, I believe, as a financial advisor, you need to be invested in the same portfolio, you're telling your clients to stick with, I'm invested in my most highly volatile portfolio that made an investor 100. I think it's an absolute, you know, professional crime to not be invested in the same portfolios as your clients. And I believe you should be invested in the most volatile portfolio that your clients are

invested in as well. So yeah, a couple of points there. I do share as much as I can with clients in terms of data and a few other things that you mentioned, Carl, but is about having grown up conversations

with clients. Fortunately, I haven't got any grenades that have been thrown into my business, which usually take the form of an email that's been sent on a on a cold Sunday evening from a client who just takes one second to press compose, and then says something like, Andy, I'm concerned about my portfolio, what are you doing about it? Potentially, which is a huge yellow card in my business. So yeah, I suppose I've been educating clients teaching them ever since I've

taken them on. We tell them the numbers going in the put the markets generally rise about 75% of the time and decline about 25% of the time, every year, the markets going to go from a high point to a low point of on average about minus 14%. Every three to five years expect at least double that. So yeah, that's it really. Back to you, Carl, over to you, Nick.

you're saying. I do think, though, that we've got to be cognizant of human beings and feelings and emotions and have been okay to, you know, if you've got a significant part of your wealth invested in a 6040 portfolio and you're looking at, you know, a pretty sizable euro or Sterling, whatever, it may be dropped, as in, you know, that looks to the amateur investor, which all our clients are like, the money has gone and I suppose, yes, of course, we have discussed at length at the

outset. And every other time we have the review meetings that look, these are temporary market declines. I think it's okay to for our clients to approach it like that. And therefore, we need to approach our clients a little bit differently, and to, you know, talk them through it and be very patient about it.

Because I've found in the past if you're, if you don't take a very empathetic view, you know, you're gonna find yourself in trouble and you might lose a little bit of trust with the fact So I think you've just got to be in massive listening mode right now, and then have a couple of key messages that you want to deliver. Alan, what are your thoughts on this?

is empathy. And just to wrap up a couple of points that you guys have already said, it remains the fact that, you know, I, and I'm sure you guys and my colleagues are all invested, we have our own family's wealth, you know, liquid investments invested exactly the same way. I don't know how this is going to turn out. It's a very unpredictable market right now, as Nick has already alluded to, you've got politicians sort of making decisions, then you

turning back and forwards. So you know, we all know, this stuff is unpredictable. So I think the message and the message that we have actually given to clients is that we're not certain we're unsure. We're exactly in the same boat as you are, personally. But we've got your back, we're looking out for

you. I think one of the biggest things if this goes into the deep behavioral stuff, human beings don't like uncertainty, when it's things beyond our control, particularly things that we don't really understand.

And this is this is what's made this current period of volatility, a bit different, they're always a bit different to the previous ones underlying things, which are actually the same, but we know that, you know, stocks and shares, equities can go up and down and do go up, up and down quite regularly. But we had all felt that maybe having having bonds in your portfolio was going to dampen down that volatility. Well, current crisis meant that it it hasn't done in fact, it's

added to it. So we've certainly got clients who are at the sort of

somewhat as well. So, the thing that we've done pulling this together is we have I do live video as a medium. So we have been able to do all these things, you know, relatively simply, nowadays, we've had our my colleagues, putting together very simple videos, Hi, we're here, a lot of uncertainty around, we're in the same boat as you are, we're paying attention to this 100% of the time, we've got your back, we'll get through this, this too shall

pass. If you want to jump on a call video or wanna meet me face to face anytime you want. I'm here, this is the time for advisors to be visible. This is this is the key point. So that's the reason there is no from answer to this. There's no answer to this is no, I've got all the solutions because no one has got the solutions if if someone tells you that then run a mile away from them. But what people want is to know, all right, I know I can get on a call with you anytime you want.

Me raising this as a question isn't a dumb thing to do? No, it's not, we're all feel the same way. So having authentic empathy, when the moment will make the difference right now get on the front foot, use video if you can, and say if you'd like to have a meeting, you wanna grab a cup of cup of coffee and have a conversation. Anytime you want. I'm here.

So my colleagues who are the ones who really are, you know, client facing have the individual relationships with the clients. They're the ones who have created videos, and they've done them to all clients. We've sent them out to all clients. Just and it really is just a, you're putting your

hand up, say I'm here. And I think after that, we're also looking at where we've identified clients that are you're more concerned, as I mentioned before, those that have engaged with us more recently, that yeah, there's a big 12 I would say first 36 months. Yeah, yeah, they're the ones that have bought hang on a minute. I didn't realize this was going to go against me that I've just I've just hired you guys. And now I'm losing. I'm losing.

do them. Very pressing and on point. And when that happened two years ago, two and a half years ago, we were doing I haven't done it for this one, a couple of reasons. Really. The fact that Sterling and the euro has devalued so much against the dollar, which is still the world's currency reserve means actually, the equity market falls have been kind of offset.

What's different this time is that its bond markets have really had a had a pummeling, no matter what we think about bonds, and I'll come on to that in a second. They dominate in terms of their influence of equity markets fall, yes, it's unpleasant to count. But when bond markets fall, it has ramifications right through the system through the banking system, through pension fund liabilities. So interest rate setting and everything else. And of course, bonds have absolutely

fallen off a cliff. As I'm sure with you guys, most of my clients don't have great exposure to bonds anyway. So thankfully, they've been inured to that in terms of their portfolio having having any problems. But there are horror

stories out there. There's a and I'm talking soon I'm going to South Africa with Andy, for his humans under management in in Cape Town in next week, actually, and I'm talking about this has been the chance for us to finally cleanse ourselves of bonds in client portfolios, they were there for one reason to dampen volatility. Turns out

they couldn't even do that. I think there's going to be massive ramifications for the attitude to risk industry that has made a fortune over the past 20 years or so putting people into totally inappropriate portfolios. They've been found wanting. There's a and this is an extreme example. And it's it's it's not the kind of bonds that we will put our clients into which will typically be shorter duration, which are more limited on the downside. The ticker for it is Tango golf 73.

This is a UK index linked gilt. Now index linked gilts are different from your average guy, no one really understands how their prices work. I know there are some index big deal there are so many moving parts. This is a long dated index linked gilts, but when I say long dated its redemption date is I think, march 2073. So it's right out

there in two days. Last week, this safe in quotes government gilt fell by 59% it's that's the kind of volunteer that if that was Kathy Woods Ark fund, we'd be saying, well, that's that's even better. That's a bad day at the office.

prices? Which which are really, they ripple out that kind of ripples out through the financial markets?

point. Advisors who recommend something for themselves and somebody different for their clients or that are the spawn of Satan. And that's, that's a technical definition. So, so when the equity markets plot, I say most of my clients don't have their big exposure to bonds really. So I haven't yet reached out to and I've got I've said it sorry. Yeah, what but one

pressure. So just being on the front foot with that and and articulating and explaining, you know, although it says pension funds, generic is unlikely to be your own pension fund. But that leads me to the other thing around the media communication by its very nature, markets and media are super, super short term, the they're talking in terms of hours, days, weeks, whereas this is this is a disconnect, because we're all kind of reporting in a an operating in a financial

services world. But our our mode of operating is multi decade, we're speaking to our clients for, you know, 10s and 10s. of years. And, you know, potentially more if you're talking about intergenerational wealth and passing wealth down. So all this stuff, eventually, it all settles down, doesn't it? If you're talking about a 30 year time horizon, your bond markets settled down equity markets, things tend to behave fairly predictable ways over

multi decade time periods. And what we've got to deal with the communications over literally hour by hour, day by day, so communication and sort of just bridging that gap, I think is a challenge for us. Just to remind clients, yes, it's crazy. Yes, it's up and down all over the place. But we were never investing for a week or a month.

rare. And so you see it. The other thing as well, we've got globally well diversified portfolio, so they're not, you know, about 50% In the US, and they've got a chunk in Europe and Far East, etc. So I think my most volatile 100% global equity portfolio is only down by about sort of minus 12 or something like that, which in the grand scheme of things is not much. But you know, depending on what headlines they see, you know, depends on on how they're going

to react. So yeah, just a couple of other sort of data points.

over the weekend. Most of them were DocuSign people signing DocuSign stuff is all that comes, there wasn't a single one. I thought I was expecting I think this is gonna be a weekend where I'm gonna get one or two clients saying I've read something in the Sunday Times comic supplements, sorry, the money section. You know, I'm spooked. And there was nothing. But you know, that maybe that's because I haven't gotten an enormous client bank. It's

clients. And this one, I'm going into this, you know, eyes wide open and somewhat experienced, but I think there's a lot of bad news to come down down the track, but then how will that but you know, obviously the markets usually ahead of the economy, we all know that. But again, we're gonna get this horrendous, you know, economic news at the same time. So has the market recovered again, we

just don't know. So yeah, I think there's some some some some pretty bad financial news to come down the track.

on. But at the same time, you know, an answer to a question from a client of ours will be exactly the point that Alan Anandi made, you're in a globally diversified portfolio. The UK makes up about 4% of that. So you know, while yeah, we'll be keeping an eye it's not the be all and isn't on that point. Like, what is going on over there voice can somebody can somebody can you summarize it in in in Wireshark? You

370 billion. And the chancellor fiddled around with a top rate of tax and brought it down to the same as it was under the last Labour government down to 40%. That costs 2 billion, and his government has just backed down in the face of criticism. It's, it's, um, the message it sends out is absolutely the turmoil in the bond market has nothing to do with that 45% tax fiddling the 2 billion is neither here nor there for the

government, it isn't. The bond markets are spooked by inflation, they're spooked by the energy subsidy that is also given away in that budget far bigger. And the government should have said that, and I am, I am just beyond. I cannot believe what they've done there. Already. She has lost her credibility. She'd been the prime minister lose trust, or really kwarteng has lost his credibility. I don't know what I but what do you do? who's who? What's the alternative? That you

know, it's at the least worse? I don't know. Alan, what do you think?

right direction I felt. And you're right, Nick is just a garden, a bit of a bit of pushback, a bit of negativity, I'm sorry, I will change it and only change one thing. And as you say, of all the things it was it was kind of neither here nor there, really. So it's disappointing. It shows you though, that this is it's we are in a kind of personality, politics, environment where you know, tough economic decisions are being watered down because people want to stay in power.

We're only what, two and a bit years away from another general election. So people are thinking ahead to that we've got a brand new prime minister. And so people are making decisions to keep, you know, maintain popularity, I don't think he's done it. You know, they've lost credibility. So, yeah, it's disappointing. I'm just off the mind, that is one of those things, you know, control the things you can control, focus on

those and let go of the rest. So it's all a lot of nonsense, really, what I can control as best I can, is our the way we operate as a business, the way we communicate with our clients, the way we engage the way we support them the way that our team operates. And just focus on that, like I think all business owners are trying to do whether working in financial services or not focus on the matter in hand where you can influence and make

decisions. The politicians are always going to be politicians, unfortunately, and they've got a different agenda and different time horizon to us. So I'm just getting on with things. I do have one, one thing to throw into the mix here in terms of client communications, and how you position all you guys will be familiar with a statement or a sort of a summary offering from Nick Murray, Nick Murray, being the kind of financial advisors advisor he's got something

yourself forward. It can be used to sort of generate opportunities with other clients who are not being communicated to by their current advisors. You could just I'm not going to read it out, but you could Is Google it

these are scary times. But you know, we've been here before we've got years or decades of experience. Don't know when necessary, what the answers are, but you want to sit down have a quiet conversation cup of coffee. Either way, the coffee is on us. You know, it's some, it's a nicely worded narrative that people can send out to

weekend. And just maybe wrapping a bow on this because we're already 31 minutes said that one thing I hadn't met the one thing I think it's gonna do for all of us, because we will do Cash Flow Planning without exception. All our clients because we're real financial advisors. I've already had a couple of clients say I'm looking forward to my next meeting. We need to come in model, can we look at interest

rate rises? Mortgage Rate, because although a 30 year cycle, yes, a 30 year cycle, but the fact is people are coming out of their fixed rate mortgages out like 1%. One, and they could be going to add variable or fixed rate of four or 5%. If they're if they're if it's happening in this week or next month. So that's coming back into the mix, which is something we haven't had to do. Right, right. They Yeah, right.

stronger than that. Just talk to people about look, now's the time, you know, let's maybe take some some of the investment money, or liquid cash and dispose of the debt that I'm a little bit distracted here because my friend Alex Smith is coming in twice across the bottom of my screen. I don't know what's happened. But anyway, just just

going up and up and up. And the projected amount of increases over the next kind of six months mean that it probably no longer makes sense to be carrying it if you also have liquid cash, but I suppose cash on my link that will make sure that you know, you can run these scenarios and say, Look, all other things being equal, I think you could probably get rid of that don't know at this stage.

Well, I think it's a bit of a hole in their arsenal to be to be to be totally honest.

can answer it. Does the recent collapse in bonds invalidate the whole risk profiling process? And given the bonds clearly have as much downside as stocks in certain scenarios? Are we all better off being in 100% Global Equity ETFs. So who posted that question in that in there in there?

your investment. And he's obviously being somewhat disillusioned by having done that found that he's encountered tons of volatility and said, you know, well, we know that long term global equities is the place to be. And so why don't we just invest in that 100%? Which, you know, we ought we want to have some controversy, we want to have some a good quality debate on this, but I think something we all agree with?

And now we're seeing we actually said they don't do anything to dampen portfolio volatility. So you have to ask the question, what is the point of them? What is the point of attitude to risk questionnaires? I think this is us. This is, this is the great reset for bonds, this is our chance to get rid of this cancer out of our current lives. And I feel quite strongly about this, as you'll find out and when I when I, when I talk about it. How do you think so we think this is this

that period. So that was one where the so called, you know, the asset allocation thing. If you wanted to dampen volatility, that was that was fine. You did get you achieve that now you haven't had it?

markets collapse. So generally speaking, they do. And this is this is you have to be clear as well about the particular type of bonds because I know in 2007, people were investing corporate bonds, which collapsed as far and fast as equities did, but, you know, government sovereign debt with like the countries like UK, US and so on, tend to be a safe haven asset.

doesn't exist. You know, when you only run out and you mentioned that we were looking at 30 year plans, multi generational plans, plans that will span decades, it's impossible to lose money historically, over any rolling 20 year period and the MSCI MSCI World Index, you cannot lose money, of course, why. So this is a sop

it's an education process. But I think as we've all identified, you can have these conversations with the clients that one of the biggest failings in my mind for risk profiling is it asks you a question at a time when you're in a in a place of if you'd like calm, calm discussions, you know, what would you how would you feel if such and such such

and such. So what but what always happens when you have significant market volatility, there's loads of other things going on in the world by so COVID was you might bloody die and your family might die so you don't really work. And right now your mortgage rates gone through the roof, you might lose your job, your family might lose their job. So there's a lot of other things which makes risk profiling in itself. Questionable though, I've talked in the past if I said to either

of any of you. Are you are you scared of snakes? You might see them not really, if I literally throw a live snake on your lap, or trust me, you're going to, you're going to recoil, you're gonna stand up or do something you told me not scared of them. So, risk profiles are somewhat artificial in the way that they are presented and the time they're presented, because you don't know how you're gonna feel, because there's probably a

lot of other things going on. So I do hope that this is an opportunity, the current situation is opportunity for that entire kind of sector and industry to reappraise rethink, or good quality advisors to rethink how the how they use these sort of tools, as opposed to just being a tick box exercise for the compliance people. And, yeah,

We're not always reacting to, you know, the new environment over to call.

obligation. And it is a bit of a process with clients. But then again, they've got us in their corner, and we're going to be holding their hands, we're going to be you know, on the phone, on email, etc. But yeah,

that's it. I'm an insider, but then we have to pander to non professionals non Insider's who are our clients and we want the best portfolio is the portfolio you stick to. That's it. The best portfolio is a portfolio you stick to so we just got to work out what portfolio you're going to stick to two new clients I've taken on long term. Sorry. Is that my first class?

more units. And she'll hopefully stick to the moment invest at portfolio. So that's a yeah, that's that.

clients lives became clear? I would like a first stab at answering that. very succinct answer. And then I guess it might be an hour and against Rama, that's, I think you put it into the, our script here. You Yeah, there was a moment actually, and I've spoken about this, and I think many people have gone down the same road.

And it was, it was the time when I discovered via a man who is very much Marmite, Mr. Paul Armisen, but I went to this thing in 2008, I went to this presentation, and he showed me how he does proper financial planning, using cash flow modeling software, I didn't know what proper financial planning was, I didn't know what cash flow modeling software was walking into this, this event, I walked out and it blew away my

mind. It just blew me away. And that was when I thought, You know what, this is my role for clients. This is the guiding them to the financial, the financial security of taking them away from the darkness from the wilderness that's coming to them, This is what I need to do.

And it was that moment, and it just changed off that cascade so much else, that you suddenly realized that investing and investments and picking funds not important dial, you realize that people just want to be having a damn good listening to. And then most people who come to you with concerns about pensions are actually saying, Nick, are we going to be okay? And it just

transformed everything. And that's 2008. And I've built my business on the back of that meeting with Paul Armisen, and whatever else, we think of the guy that is to his eternal credit, and there are many advisors, good advisors in the UK, doing proper financial planning, who wouldn't be doing it for Paul Armisen. So that's my

investments and stuff. I know, you know, how important is we are going to give our clients a great portfolio is going to give great returns, but certainly not the central thing that we're doing. I mean, it's easy to just set up and get them the right portfolio, you know, early on. So I'd say is important, but it's quite easy. Anyway, push back on a good point, and it will come back to you. As you answer the question of what was the career defining moment for

you? But just to be easy? I'll just jump in your Slipstream, Nick, because mine's the same. It's my own version of that. And is with the same guy, Paul, Paul Thompson,

life. He I mean, Paul tells, and if you've read his book, he tells us very deep and personal stories about you know, losing his mom when he was quite young, and all this kind of, we put off things for later, you know, wait, so this happens. Wait till that happens and actually spoke about this, if it's still available for you can still get this a poor answers first. conference started, was it start with why? Back to why? Back to

why? Back to why? And I spoke about this my sort of moment of the penny dropping, and it had a big impact on me. Because as a result of that, and I thought about my own life, I ended up getting married, I ended up having a kid also, because I just thought, yeah, this puts everything in perspective, what are you doing with your life? Why do you keep kicking things down the road and wait for it, wait till something gets better?

You know, take action on it. And so I just thought at that at that moment, I'm going to start my own sort of situation. And then I'm going to get this software into the business. And you know, and we've been using it ever since. And it was a it really was a game changer. So Paul has been hugely influential, has to be said, over to you, Andy, what was your getting back to the question, was there a moment in your career when everything clicked, and your role in clients lives became clearer?

of those people. I joke at it when do we have a coffee about 11 years ago or something and Marleybone High Street who pay for the coffee? Maybe message was less than half iPads 50. Anyway, we'll move on from that. For me, it's finding Nick Murray. So he was introduced me introduced to me by another financial advisor. And that completely changed my entire life. And well, to be totally honest. And that spawned lots of

other things. Yeah, so he is definitely the biggest influence on my career over to call

she didn't believe them. And we did the the financial plan, which demonstrated that the avoidance of and she got emotional. She was like, for the first time could see right in front of her eyes in pictures that they were going to be okay. And she leaned across to him and said, Are you Can you promise me that we're going to be okay, if

I give up? And I went, Yes. And she, and I can tell you up, I got a little bit of emotional and so that the Chartered Accountant, and for me that was we had been doing it a while at that stage. But that was the first time. Yeah, we're actually having a real impact here. This is this is real stuff. So that was my moment. And that kind of gave me the impetus to drive this business on and to try and I suppose expanded and scale it to where we are today.

might miss it. I think it's time for us to move on to culture corner. And look ecological. I'm gonna go first very quickly, and I'm talking about something that's a bit in the weeds. And you might think Well, Nick, that's of interest to you, because you're a podcast kind of person. But I might my gadget is what I'm talking to today, which is a Samsung gotrek Pro Mic. And the reason why I think the audience might want to know about this is that we're all now doing way more zoom than we were

before. And some of us are doing nearly all of our client facing work through the medium of zoom. So you want to give the very best presentation of yourself as you can do all the time, because perception is reality. And if you've got a crappy sounding microphone and a crappy sounding camera, it's a pretty crappy experience. And we don't know we're in the service business ultimately. So I bought this mic. It's lovely. What Why is it better than anything else? Well, it's got a it's got the mute

button on it. So I can press that without having to fiddle around with my computer settings. It's got a level thing. So I can adjust the level of the microphone again without having to fiddle around with my computer settings. And it weighs 1.6 kilograms built like an absolute brick. You know what house and I love it. You can get it they retail for 150 on Amazon, but you can get this as an eBay source knocking out for 99 quid, and so far, I'm very

much in love with it. ALAN SMITH scandal bringing down Wirecard on Netflix tell us, Mr. Smith. Yeah, there's

sorts of shady characters. In fact, one of them who was the Chief Operations Officer of Wirecard, has just disappeared.

He's just He's flown to wherever we destination unknown and continues to be out with the grasp of the, you know, the regulators and the authorities, because it was this huge scandal and a fraud and a company that was you know, that it was supposed to be the darling of the German economy fated by the Chancellor of Germany, or the politicians that was going to compete with all this a US Silicon Valley companies appears like a, you know, a sort of PayPal payment processing type

company. But once that once this journalism journalists started digging in, it's funny more and more irregularity. He's really there was death threats against him and his family was people following him for a period of time they, he was he was sort of suspended by the FT for a period of time. It really is like a story that you couldn't imagine was, you know, as they say, truth is stranger than fiction. It's well worth watching, just because it's fun and interesting

and really engaging. I remember reading the newspaper reports, it was only a couple of years ago. I think the moral of the story here is that linking it back to investment is that diversification is your friend.

Because, you know, no doubt many of most of our clients were invested in Wirecard, for a period of time as one of the sort of biggest companies in the German economy, they would have been, but the fact that they went under went out of business due to fraud probably didn't make much difference to the overall client investment returns, because it'd been a very small part, but no highly entertaining worth watching. And, you know, hats off to Dan McCrum, the FT journalist who did a sterling job.

very interesting. And I think United capital, which was his business, before he sought to Goldman Sachs, was superb. And I read off and listened to as much as I possibly could. So a lot of matters is based around some of the stuff that I would have learned from him. Amongst lots of other people. Obviously, there are things that he says,

but I don't agree with. But I think the point before you guys have your say on this, I think the point on this is that Well, number one, if you're into real financial planning, I think that Mike, Michael Kitsis podcast is a really good one to be following, among some other really good ones from America.

And number two, you know, you, you should be taking as much inspiration as you possibly can, from people who have been there, done that, and from things or values that they have promoted, that you can also align your old values, too. So I think that's important. So yeah, I found it really good. Probably not as good as some of the other podcasts that Joe has done. But I guess he's a little bit hanging off now that he's under the Goldman Sachs brand. So yeah, it's worth it's worth

listening to. If scaling of financial planning business and growing a financial planning brand is on your radar.

your 1%. And once it doesn't have to be the way you charge your clients and certain clients be certain wealth levels were uneconomical. And he was talking about getting using technology to get the number of clients or any individual advisor can look after up to 250 or 300. And kitchens sort of trying to push back on that sort of unpacked

it. So there's only you know, there's 2000 hours in the in the year how and Georgia and come up with well, you know, you need five minutes preparation for a client meeting all you guys, you seem very, very down on a negative about your independent advisors, you know, the smaller boutique style firms, all of us represent very negative. I just thought, come on. That's what you were. That's what you built.

He built United capital through a significant acquisition model, he bought lots of other firms and he rolled that into Goldman's. And it just felt to me he was a bit more negative than they perhaps should have been biting the hand that feeds because he's now part of this huge kind of global investment bank machine. And I think it just did push back and you're right what you say Carl, there's lots to be learned from Georgia and I will go back to Episode whatever it was 200 to 200 or

100. There's 100 100 100th episode when he was at United capital, because I remember that one listen to that all was good a few years ago. Tons of good ideas which still stand the test of time today. I just I just didn't love what he was saying. about the kind of the the advisory model, the independent advisory model and how he's pushing forward and coming up with ideas how you can squeeze more revenue out of your clients. But what do you think about it, Nick?

fantastic. Like this and I think when you sell to Goldman Sachs part of your dies inside that's, I mean, I really do think that he referenced Ken Fisher as someone who he overlays it when I'd love it he respects I'm sorry that is an immediate red flag just seemed about our USP is we can flow special investments because we've got the Goldman Sachs wait behinds I thought God is that I could feel much Michael Kitsis is a very polite host I could feel him wincing I some of the answers I

could feel. So that's the debits Well, you know what, this guy's story his career story is very interesting. Guys, we're at the hour mark. I'm channeling our inner Michael Kitsis in the shownotes I got a line saying and be sure to listen to the end when nothing much happens. And this is the end of our episode so I think on that note, we'll say goodbye Andy your posts your posts. Are you done, sir? Done. Okay, guys, all right. Nothing