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Remembering the Life and Work of Jonathan Clements · Masters in Business

0:02
Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. This is Masters in
0:11
Speaker 1: Business with Barry Ritholts on Bloomberg Radio.
0:16
Speaker 2: This week on the podcast, I get to sit down
0:19
Speaker 2: with Jason Swig and William Bernstein remembering their friend Jonathan Clements.
0:25
Speaker 2: Jonathan was a Wall Street Journal personal finance columnist and
0:29
Speaker 2: author for almost twenty years. He's beloved by those people
0:34
Speaker 2: in the industry. In many ways, Jonathan has done as
0:37
Speaker 2: much as anybody to push the idea of indexing, at
0:42
Speaker 2: least anybody since Jack Bogel. I thought this conversation, despite
0:47
Speaker 2: the fact that we know Jonathan received a terminal diagnosis
0:51
Speaker 2: and we already know how it ended, I thought this
0:53
Speaker 2: conversation was interesting, uplifting, and fascinating. I think you will
0:58
Speaker 2: also with no further ado, my remembrance of Jonathan Clements
1:03
Speaker 2: with jason's Wig and William Bernstein.
1:06
Speaker 3: Thanks Barry, glad to be here.
1:07
Speaker 2: So let's start out with the beginning. I want to
1:10
Speaker 2: talk a little bit about who Jonathan was. We'll talk
1:13
Speaker 2: about his two most recent books, including the one coming
1:17
Speaker 2: out in May of twenty twenty six. But how did
1:20
Speaker 2: each of you meet Jonathan? What were your early impressions
1:23
Speaker 2: of him like, let's start with you.
1:24
Speaker 3: You want me to go first.
1:25
Speaker 4: Yeah.
1:26
Speaker 3: So Jonathan and I met the third week of March
1:30
Speaker 3: in nineteen eighty seven when I joined Forbes Magazine and
1:35
Speaker 3: he was already there, and we almost instantly became good friends.
1:45
Speaker 3: I would say we probably went out to lunch at
1:48
Speaker 3: least twice a week for the next four years, certainly
1:54
Speaker 3: every Wednesday, fish cakes and spaghetti at the New Courtney
1:59
Speaker 3: on Urteenth Street in Manhattan, which I think was I
2:03
Speaker 3: want to say was four dollars in ninety five cents.
2:06
Speaker 2: That's right. The Forbes office is right over there on
2:10
Speaker 2: was eighteenth and fifty. All the Faberge eggs were there
2:14
Speaker 2: the whole the whole building was kind of uniquely.
2:16
Speaker 3: Situated Fifth Avenue and twelfth Street, very close. And Jonathan
2:23
Speaker 3: had a he had a really unusual sparkle. He always
2:31
Speaker 3: had a twinkle in his eye. He thought almost everything
2:34
Speaker 3: was funny, because of course, almost everything is funny if
2:40
Speaker 3: you think about it the right way. And you know,
2:44
Speaker 3: he might be writing about some con artist who was
2:48
Speaker 3: stealing people's money, or some mutual fund that was overcharging people.
2:53
Speaker 3: But he always found the humor in the situation and
3:01
Speaker 3: I loved that about him, and we were friends from
3:06
Speaker 3: that moment on ever since.
3:08
Speaker 2: Bill, How'd you meet Jonathan?
3:09
Speaker 4: I met him a little later. It wasn't until about
3:12
Speaker 4: the mid nineties when I was still practicing medicine and
3:16
Speaker 4: I was finding my feet in finance and I was
3:18
Speaker 4: starting to write. And I did what edny aspiring financial
3:22
Speaker 4: writer does, which is you start chatting up financial journalists,
3:27
Speaker 4: and he responded and he started quoting me on the journal.
3:31
Speaker 4: And for many years I was just a source until
3:34
Speaker 4: you know, maybe the late the early twenty tens, the
3:39
Speaker 4: late aughts, and then we became friends personal friends after that.
3:44
Speaker 4: And you know, he did think that everything was funny,
3:48
Speaker 4: and he just had such a pleasing personality. He had
3:52
Speaker 4: a high hedonic set point. He was always in a
3:54
Speaker 4: good mood, and he always thought that everything was funny,
3:57
Speaker 4: which is a fabulous combedy. And the other personal characteristic
4:03
Speaker 4: that he had which just powered his career, I think,
4:06
Speaker 4: was that he was willing to talk about the hard
4:08
Speaker 4: things in his life, his struggles with money, and he
4:13
Speaker 4: was willing to talk about his divorces, and of course,
4:15
Speaker 4: in the end, his impending demise. And so it was
4:19
Speaker 4: those three things together. I think that really made him
4:25
Speaker 4: such a unique financial journalist and human being.
4:28
Speaker 2: So when I was doing preparation for this, I learned
4:32
Speaker 2: a lot of things I was wholly unaware of, including
4:34
Speaker 2: a quote from you, Bill, which was, you owe your
4:38
Speaker 2: entire career investments to Jonathan's work. You have to explain
4:43
Speaker 2: how a neurologist in North Bend's, Oregon ended up having
4:47
Speaker 2: a career change by a personal finance journalist.
4:53
Speaker 4: Well, I happened to live in a country that doesn't
4:55
Speaker 4: have a functioning social safety net, and so I realized
4:59
Speaker 4: I was going to have to vest on my own
5:02
Speaker 4: if I wanted to survive my retirement financially. And so
5:06
Speaker 4: I approached it the way I thought anybody would scientific
5:09
Speaker 4: training would do, which is I read the peer review literature,
5:12
Speaker 4: the basic textbooks, and I collected data and I built models.
5:17
Speaker 4: And when I was done with all that, I had
5:19
Speaker 4: actually had something that was useful to small investors and
5:22
Speaker 4: in a couple of instances even too professional investors. And
5:27
Speaker 4: so I started writing about it. The Internet came to
5:29
Speaker 4: my community about that time. I put the stuff on
5:32
Speaker 4: the web, my material on the web, and Jonathan picked
5:37
Speaker 4: it up, and so he started quoting me in the
5:41
Speaker 4: in the in the Wall Street Journal. And then that
5:44
Speaker 4: was that opened the door to getting my books published
5:48
Speaker 4: and also to you know, a financial advisory business as well.
5:52
Speaker 4: And so it's like a lot of a lot of
5:54
Speaker 4: things in a complex life. It was just serendipity, one
5:56
Speaker 4: thing leading to another.
5:58
Speaker 2: Huh, really really interesting, Jason, You're you're with Jonathan at
6:03
Speaker 2: Forbes and then you're together at the Wall Street Journal.
6:07
Speaker 2: But I'm struck by nineteen eighty seven, starting not only
6:12
Speaker 2: the year of the Great Crash, but long before indexing
6:17
Speaker 2: was the dominant intellectual framework, certainly in terms of money
6:21
Speaker 2: flows into mutual funds and ETFs. What was it about
6:27
Speaker 2: Jonathan's writing that seemed to reshape a lot of the
6:33
Speaker 2: conversation about investment.
6:35
Speaker 3: Well, I would say, I don't think this is an exaggeration.
6:40
Speaker 3: I would say more than any other individual except Jack Bogel,
6:46
Speaker 3: Jonathan put index funds on front and center for American investors.
6:53
Speaker 3: And you know, he realized very early on, I'm that
7:01
Speaker 3: active management in the aggregate was not earning its keep.
7:07
Speaker 3: It was charging more than it could possibly deliver for clients.
7:14
Speaker 3: And Jonathan realized there's an alternative and I'm going to
7:20
Speaker 3: keep telling people that's what they should do. And he
7:24
Speaker 3: wrote he must have written two or three hundred columns
7:28
Speaker 3: telling people that they should buy Index ones and a
7:32
Speaker 3: lot of his readers, particularly professional readers, hated that because
7:38
Speaker 3: he was essentially saying, don't hire them, you know, hire
7:43
Speaker 3: Vanguard or State Street or another Index. Lack rod.
7:48
Speaker 2: Think about the Big three, the three biggest mutual fund
7:51
Speaker 2: of ETF companies today really derive the lion's share of
7:56
Speaker 2: their assets, certainly half at black Rock, probably over half
8:01
Speaker 2: at Vanguard from Index.
8:04
Speaker 3: And you know, you can eat the math is not
8:08
Speaker 3: hard to do. You know, investors have saved hundreds of
8:13
Speaker 3: billions of dollars in superfluous management fees by moving from
8:19
Speaker 3: active to passive investing. And Jonathan deserves a lot of
8:23
Speaker 3: credit for that because I can attest coming sort of
8:28
Speaker 3: coming to it. I don't know what would I say
8:30
Speaker 3: two or three years behind him, the amount of hate
8:38
Speaker 3: mail I used to get and hate phone calls. You know,
8:44
Speaker 3: it's not easy to tell people that they should not
8:49
Speaker 3: have a right to make as good a living as
8:51
Speaker 3: they have been. They don't like hearing that. But if
8:55
Speaker 3: it's in the best interest of the larger part of
8:59
Speaker 3: your audience, and that's the message you have to deliver.
9:02
Speaker 3: And that's the choice Jonathan made really before any other
9:07
Speaker 3: investing or personal finance journalist in the country. And once
9:10
Speaker 3: he made that choice, he would not be moved.
9:14
Speaker 4: Go ahead, Bill, Yeah, I mean fortune favors the prepared,
9:18
Speaker 4: and I think what prepared Jonathan for that was from
9:21
Speaker 4: about what nineteen ninety to what nineteen ninety four he
9:24
Speaker 4: covered mutual fund managers, and boy, that's an awful sandbox
9:28
Speaker 4: to have to play. And because how do you get
9:30
Speaker 4: into that sandbox, Well, you take a lot of risk
9:33
Speaker 4: and you get lucky, and going forward the track record
9:38
Speaker 4: is not so good. And he saw that often enough
9:41
Speaker 4: that I think it drove him to the conclusion that
9:44
Speaker 4: Jason was just talking about.
9:46
Speaker 2: I think it was Professor French at Dartmouth of FAMA
9:50
Speaker 2: French fame said it takes about twenty years to figure
9:53
Speaker 2: out if a fund manager is skillful or lucky. At
9:56
Speaker 2: least two or three years of returns certainly only doesn't
10:00
Speaker 2: tell us anything.
10:01
Speaker 4: Yes, he has one example that just stays in my memory,
10:04
Speaker 4: which is that if you have a hedge fund manager
10:07
Speaker 4: who can beat the market by five percent per year,
10:11
Speaker 4: and the extendard deviation of stocks is twenty percent per yeer.
10:14
Speaker 4: If you grind through statistics on that, it takes sixty
10:17
Speaker 4: four years to get the statistical significance.
10:20
Speaker 2: Wow, that's quite amazing. He called the at his own
10:24
Speaker 2: advocacy for index funds an obsession that some readers found irritating.
10:29
Speaker 2: And when I read that line, I thought of your quote,
10:33
Speaker 2: which is your job is to write the same column
10:35
Speaker 2: week after week after week, but in a way that
10:38
Speaker 2: neither your readers or your editors figure out. So how
10:43
Speaker 2: do you continually write about indexing if your readers are
10:48
Speaker 2: finding it irritating?
10:49
Speaker 3: Well, I think Jonathan arrived at the same place I did.
10:54
Speaker 3: And of course, even though he was slightly younger than me,
10:58
Speaker 3: he was a couple of years ahead of me because
11:01
Speaker 3: he just started on this topic earlier than I did.
11:06
Speaker 3: But we both ended up in the same place, which
11:09
Speaker 3: is you you keep your message consistent, but you frame it,
11:17
Speaker 3: you tell it, you ornament it in different ways every
11:23
Speaker 3: single time. And Jonathan was an unparalleled master at writing
11:33
Speaker 3: what some people you know, disparagingly call listicles. He would,
11:39
Speaker 3: you know, come up with twenty five funny things that
11:44
Speaker 3: active managers say to justify their underperformance. And you know,
11:49
Speaker 3: he would run through all these bullet points, each one
11:53
Speaker 3: of which would be very funny, and then at the
11:56
Speaker 3: end he would say, and that's why I think you
11:59
Speaker 3: should put all your money in next ONNDS.
12:01
Speaker 2: I wonder how many of those lines came from angry
12:04
Speaker 2: emails from fund manager.
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Speaker 3: Probably a lot of them.
12:08
Speaker 2: So so one of his core principles is that successful
12:13
Speaker 2: investing should be comprehensively, almost aggressively boring, which is kind
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Speaker 2: of ironic. Both asset management and financial journalism are unusually noisy,
12:28
Speaker 2: fomo based industries. So how do you make a message
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Speaker 2: stick as an island of rationality in a sea of
12:38
Speaker 2: noise and emotional driven stimulus.
12:45
Speaker 4: Silence. That's that's that's a tough one. You've become what
12:53
Speaker 4: Jason has become a master of, which is saying the
12:56
Speaker 4: same thing and in so many different ways that your
12:59
Speaker 4: editors and your readers don't notice that you're saying the
13:01
Speaker 4: same thing over and over again.
13:04
Speaker 3: No doubt about and very sorry if I can jump in.
13:09
Speaker 3: You know, I think one thing that is underappreciated about
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Speaker 3: somebody like Jonathan is the amount of integrity and courage
13:20
Speaker 3: it takes to stick to a simple message. You know,
13:26
Speaker 3: the job of the job of an investigative journalist is
13:30
Speaker 3: to get people who don't want to talk to you
13:33
Speaker 3: to tell you things they don't want you to know.
13:36
Speaker 3: The job of a mainstream journalist is to tell your
13:41
Speaker 3: readers things that they need to know, whether they want
13:45
Speaker 3: to hear them or not. And that's what Jonathan was
13:49
Speaker 3: brilliant at.
13:51
Speaker 4: Yeah, and it's again, the word integrity comes up so
13:55
Speaker 4: many different times when you're talking about Jonathan because here
13:58
Speaker 4: he is working in a sandbo you know, active fund managers,
14:02
Speaker 4: that's how he pays, he's paying his mortgage, and he,
14:05
Speaker 4: you know, wakes up one morning and he says, this
14:08
Speaker 4: is intellectually dishonest. I've got to find something else. I've
14:11
Speaker 4: got to find some other message. And very few journalists,
14:15
Speaker 4: i think, make that choice. They just keep on plugging
14:17
Speaker 4: away and don't question what they're doing.
14:20
Speaker 2: Really interesting, and you know, we're talking about investing in money,
14:25
Speaker 2: but Clements emphasized this wasn't about getting rich, it was
14:29
Speaker 2: about building a good life. So when do you think
14:35
Speaker 2: his thinking shifted from simple building a portfolio to something
14:40
Speaker 2: a little more philosophical.
14:43
Speaker 4: I think that that happened in the early two thousands,
14:46
Speaker 4: when I think all three of us started to come across,
14:50
Speaker 4: and maybe all four of us started to come across
14:52
Speaker 4: the well being research that academic neuropsychologists were doing. What
14:59
Speaker 4: makes people have money is a very small part of that.
15:04
Speaker 4: And that's what Jonathan you made into. I think his
15:08
Speaker 4: mission and financial journalism was it was exploring the connection
15:12
Speaker 4: between money, money and happiness, and that's not something of
15:16
Speaker 4: very many financial journalists venture into.
15:20
Speaker 2: I know, there is more money when you're broke is
15:24
Speaker 2: better than less money, but it plateaus holding steady for
15:28
Speaker 2: things like divorce and illness. It plateaus surprisingly rapidly. So
15:37
Speaker 2: let's channel Jonathan for a moment. What is the purpose
15:41
Speaker 2: of money and how does it help one live a
15:44
Speaker 2: rich fulfilling life.
15:47
Speaker 3: Well, so Jonathan really explored that research into hedonic psychology,
15:54
Speaker 3: particularly the implications of does money by happyiness? How can
16:01
Speaker 3: you use money to achieve happiness? And there's an enormous,
16:07
Speaker 3: voluminous amount of research on this in very very obscure
16:12
Speaker 3: academic journals, and when Jonathan started working on this, very
16:17
Speaker 3: few non academics were even aware that this research existed.
16:23
Speaker 3: But I would say there's a handful of takeaways from
16:30
Speaker 3: that work that research. One is that possessions don't generally
16:36
Speaker 3: make people happy. Now there's exceptions to that, but as
16:41
Speaker 3: a general rule, the bigger house, the fancier car, the
16:49
Speaker 3: painting on the wall, the bigger couch generally don't move
16:57
Speaker 3: people's happiness as much as they expect. And that's really
17:00
Speaker 3: the key is the difference. It's the gap between what
17:05
Speaker 3: you spend and what and the happiness you expect to
17:08
Speaker 3: get from the spending that causes the disappointment that people feel.
17:15
Speaker 3: And you know, I think everyone listening has had a
17:20
Speaker 3: similar experience. You know, you've been in a starter house.
17:25
Speaker 3: You see a new house you love, you talk about
17:29
Speaker 3: it with your significant other, you agree we're going to
17:31
Speaker 3: take the plunge. You buy the house and you move
17:34
Speaker 3: in and you're just thrilled. And then you know a
17:37
Speaker 3: year later you look around and the paint is chipping,
17:40
Speaker 3: and you know, there's like rats in the attic, and
17:46
Speaker 3: it's more money, more problems.
17:47
Speaker 4: Right.
17:49
Speaker 3: And the next level beyond that observation that possessions are
17:58
Speaker 3: not the key, is that you want to use your
18:04
Speaker 3: money to create experiences with people you love, shared experiences.
18:11
Speaker 3: You want to use money to create memories, and so
18:16
Speaker 3: you spend your money on things you can do with
18:19
Speaker 3: friends and family, joint vacations, commemorative events, family reunions, things
18:26
Speaker 3: like that. And then it's the final level that Jonathan
18:30
Speaker 3: explored more and more in the later years of his life,
18:34
Speaker 3: and especially after he got his terminal diagnosis, which is
18:38
Speaker 3: using money to create, meaning finding something bigger than yourself
18:45
Speaker 3: that you can support or promote or strengthen with your money,
18:51
Speaker 3: giving to a cause you care about, putting something front
18:56
Speaker 3: and center in your life. You know, supporting a nonprofit, volunteering,
19:06
Speaker 3: all of those activities can really move the needle much
19:12
Speaker 3: more than you would get if you bought a new
19:16
Speaker 3: table or some other possession you've had your eye on.
19:21
Speaker 4: Yeah, and the thing about Jonathan was he he lived
19:25
Speaker 4: that ethic every day of his life. And you know,
19:30
Speaker 4: he didn't make a lot of money as a financial journalist.
19:32
Speaker 4: I think he worked for a couple of years at
19:33
Speaker 4: citycarp and made a pretty decent salary, but you know,
19:36
Speaker 4: his lifetime earnings were not that high, and yet he
19:41
Speaker 4: amassed a significant amount of assets by hammering away at
19:46
Speaker 4: being frugal and amassing enough financial capital so that so
19:52
Speaker 4: that he didn't have to depend upon his human capitals.
19:55
Speaker 4: As he put it, I never saw him so happy
19:58
Speaker 4: as when he shows up at our place in Portland
20:01
Speaker 4: having spent two dollars to take the Max train in
20:04
Speaker 4: from the airport, you know. And then the other thing
20:08
Speaker 4: that so Jason just just explained very nicely the three
20:11
Speaker 4: levels that he climbed, and I think there was yet
20:13
Speaker 4: another level on top of that, which is to have
20:16
Speaker 4: enough assets to so that you don't have to worry
20:21
Speaker 4: about assets, in other words, to happen now. It's the
20:23
Speaker 4: only purpose of money, I think for Jonathan was not
20:25
Speaker 4: having to worry about.
20:26
Speaker 2: Money, right right, you know, he said something and I
20:29
Speaker 2: may even be lifting this from the headline of one
20:31
Speaker 2: of his early diagnosis articles, which was dying as easy,
20:37
Speaker 2: but a state planning and taking care of your loved
20:40
Speaker 2: ones after you're gone is hard. And that struck me
20:44
Speaker 2: just as such a quirky, matter of fact observation about
20:48
Speaker 2: something we all are going to face. That well, eventually,
20:52
Speaker 2: he just had to face a little earlier, and with
20:56
Speaker 2: the sense of humor dying, you know, the old joke
20:58
Speaker 2: about dying is easy. Coin is hard. No. No, estate
21:02
Speaker 2: planning and taking care of your loved ones, that's what's hard.
21:05
Speaker 3: Yeah.
21:05
Speaker 4: I mean, if there's one thing that Jonathan didn't believe,
21:08
Speaker 4: it's that he who dies with the most toy wins, right. Yeah.
21:12
Speaker 2: Coming up, we continue our conversation with William Bernstein and
21:16
Speaker 2: jason's Wig Remembering Jonathan Clements, discussing his most recent book,
21:22
Speaker 2: The Best of Jonathan Clements. I'm Barry Richolts. You're listening
21:26
Speaker 2: to Masters in Business on Bloomberg Radio. I'm Barry Ridults.
21:42
Speaker 2: You're listening to Masters in Business on Bloomberg Radio in
21:46
Speaker 2: an extra special edition of the show. This week is
21:50
Speaker 2: all about remembering Jonathan Clements, the Wall Street Journal personal
21:54
Speaker 2: finance columnist and author. And my special guests are William
21:59
Speaker 2: Bernstein and jason's Wig, who know and have worked with
22:03
Speaker 2: Jonathan for many decades. So let me pull on one
22:07
Speaker 2: little thread, which is the idea of delayed gratification. And
22:12
Speaker 2: I already know what your answer is going to be,
22:13
Speaker 2: but I have to pose the question. So here's somebody
22:17
Speaker 2: who's diligent about saving, diligent about postponing that sort of gratification,
22:23
Speaker 2: and then, unfortunately doesn't get the full fruits to enjoy it.
22:29
Speaker 2: Give us, give us your explanation as to how and
22:32
Speaker 2: why he was perfectly fine with that.
22:37
Speaker 3: Well, So I talked a lot with Jonathan the last
22:42
Speaker 3: year of his life. I'm you know, I think he
22:46
Speaker 3: called me maybe two or three weeks after he got
22:50
Speaker 3: word of his terminal diagnosis. And the thing that struck me, Barry,
22:56
Speaker 3: was that, you know, having been his friend for decades,
23:04
Speaker 3: I could instantly tell that none of this was an act.
23:08
Speaker 3: You know, most of us if we got a terminal diagnosis,
23:14
Speaker 3: particularly one like Jonathan's where he was given five to
23:19
Speaker 3: originally five to twelve months, I think is what they said,
23:22
Speaker 3: right Bill, we would put on a brave face, we
23:28
Speaker 3: would like be faking it for our friends and family.
23:33
Speaker 3: But Jonathan was from the very beginning, he was totally
23:39
Speaker 3: at peace with it. And I can't tell you that
23:43
Speaker 3: I can totally explain that. I think he meant what
23:49
Speaker 3: he said, which is he felt he had lived the
23:53
Speaker 3: best life he could have, and he had done everything
23:58
Speaker 3: he wanted, He accomplished most of what he wanted to achieve,
24:04
Speaker 3: and he was somehow he was okay with the news
24:12
Speaker 3: that would just absolutely devastate most people.
24:16
Speaker 4: Yeah, I mean. Neuropsychologists use a personality scale as a
24:19
Speaker 4: five item scale, and one of the items is something
24:22
Speaker 4: called neuroticism, which is basically how much you focus on
24:26
Speaker 4: the problems in your life. And he had a very
24:28
Speaker 4: high Haydonic set point. He was always in a good
24:30
Speaker 4: mood most of the time, and so his neuroticism score,
24:33
Speaker 4: as far as I could tell, was zero, and he
24:35
Speaker 4: was in a good nude most of the time. So
24:38
Speaker 4: he dealt with his own mortality as as well as
24:43
Speaker 4: he could. A sense of humor. My gosh, you know,
24:46
Speaker 4: he joked to everybody what a great marketing strategy terminal
24:50
Speaker 4: diagnosis was. If you're trying to flog a book.
24:54
Speaker 2: Don't recommend it. You only get to use it once.
24:57
Speaker 2: But that is only someone with the sense humor can
25:01
Speaker 2: say that. So let's talk about the book the best
25:05
Speaker 2: of How did this book come together? Whose idea was it?
25:09
Speaker 2: What was it like working on a project with Jonathan
25:13
Speaker 2: under his awareness of his terminal diagnosis.
25:17
Speaker 4: Who's who'se I well, I think I was going to
25:19
Speaker 4: look at you and say, whose idea was it? I
25:21
Speaker 4: think it was. I think I think it was Jonathan's idea. Actually, yeah,
25:25
Speaker 4: he just decided he wanted to put together a compilation
25:29
Speaker 4: and I think his his main goal was to raise
25:33
Speaker 4: funds for a charitable purpose, which it took us a
25:37
Speaker 4: while to evolve. Uh and and and that was that
25:43
Speaker 4: was the project.
25:44
Speaker 2: And so let me just interrupt you. The Jonathan Clements
25:46
Speaker 2: getting going on savings initiative funding roth Ira contributions for
25:52
Speaker 2: young adults from low income households. That sounds less like
25:56
Speaker 2: a book torn more like a policy intervention.
26:00
Speaker 4: Yeah, yeah, yeah, it was. And that was It turned
26:04
Speaker 4: out that that translating that idea into something practical was
26:07
Speaker 4: a bit harder than everybody had than anybody he realized,
26:12
Speaker 4: but it seemed like a good idea at the time.
26:14
Speaker 4: And so Jason and I and Jonathan put together a
26:19
Speaker 4: list of his columns on I think it was Jonathan
26:21
Speaker 4: who basically gave us the list, and Jason helped me
26:24
Speaker 4: organize it, and we self published it through through Amazon,
26:29
Speaker 4: and it has raised a substantial amount of money for
26:33
Speaker 4: the initiative which we eventually arrived at, which I don't
26:37
Speaker 4: know if we want to talk about that, just.
26:38
Speaker 2: Yeah, sure we could talk about it. Let's talk a
26:41
Speaker 2: little bit about how much money did it raise and
26:43
Speaker 2: did anyone have any targets in mind? Was this was
26:46
Speaker 2: this all upside surprise?
26:47
Speaker 4: Yeah, all in the order of about sixty thousand dollars,
26:50
Speaker 4: which a substantial amount of money. We actually raised a
26:53
Speaker 4: lot more money through the through the Bogel Center, through
26:57
Speaker 4: personal donations that came into the John C. Bogels and
27:00
Speaker 4: our financial literacy, So you know, even that that raised
27:06
Speaker 4: a whole lot more money, and that money is going
27:09
Speaker 4: into a research project. You know, Jason, I nevermember what
27:15
Speaker 4: JPAL stands for. So that's that's that's the group, the
27:18
Speaker 4: research group is doing this.
27:19
Speaker 3: Yeah. So JPAL is behavioral economics research institute based at
27:26
Speaker 3: MIT in Boston and it's run part partly by Esther
27:33
Speaker 3: Duflow who shared a Nobel Prize in economics and I
27:38
Speaker 3: want to say twenty twenty three. And j PAL does
27:43
Speaker 3: all kinds of interventions based on behavioral economics research trying
27:50
Speaker 3: to encourage people from low income households around the world,
27:55
Speaker 3: by the way, to form more construction of savings habits,
28:02
Speaker 3: to borrow more prudently, to become long term investors. And
28:10
Speaker 3: we partnered with them because we really felt that getting
28:19
Speaker 3: Jonathan's vision from an idea into an actual program was
28:29
Speaker 3: beyond us. We needed help, and so JPOW works with
28:36
Speaker 3: academics at universities all around the world, and between Boston University,
28:46
Speaker 3: University of Chicago, and some other Northeastern Northeastern we were
28:55
Speaker 3: able to round up some great economists and researchers to
29:00
Speaker 3: make the program a reality, and it last summer. It
29:04
Speaker 3: was piloted with some basically high school kids in Boston
29:13
Speaker 3: from poor families who were randomly selected to get money
29:20
Speaker 3: to open a roth ira. And we're testing whether there's
29:25
Speaker 3: particular kinds of messaging or other techniques that can not
29:31
Speaker 3: only encourage them to invest, but then to turn them
29:36
Speaker 3: into investors by changing their own behavior over the long term.
29:42
Speaker 3: And it's still very early. We don't know whether it'll work,
29:45
Speaker 3: but we hope it will, and even if it fails,
29:51
Speaker 3: we're pretty confident we'll learn some useful things about how
29:56
Speaker 3: to encourage good long term investing behavior here.
30:00
Speaker 4: Yeah, it turns out it's really hard to give away
30:03
Speaker 4: money to kids for a roth ira.
30:06
Speaker 2: Yep, this is before we passed. I don't know if
30:11
Speaker 2: you want to call them baby bonds or Trump accounts
30:13
Speaker 2: or whatever. That thousand dollars initial tax.
30:17
Speaker 4: To parity predates that.
30:18
Speaker 2: Yeah, so so, and by the way, that dates back
30:22
Speaker 2: to I'm drown a blank on his name, but he's
30:24
Speaker 2: a VC out in California who might as well first
30:29
Speaker 2: first proposed this, you know, a decade ago, and it
30:32
Speaker 2: was slogging away trying to get it accepted. So let's
30:35
Speaker 2: let's those are what the proceeds are going to be
30:38
Speaker 2: used for. Let's talk about the book itself. Sixty sixty
30:43
Speaker 2: columns out of over a thousand. That has to be
30:46
Speaker 2: a tough list. Anything on the list surprise you make
30:50
Speaker 2: you scratch your head. What how do you think of
30:52
Speaker 2: the arc? Now that you guys helped structure and organize this,
30:57
Speaker 2: which really is half the battle. Once you have it structured,
30:59
Speaker 2: it becomes a whole lot of ease.
31:00
Speaker 3: Yeah.
31:01
Speaker 4: I don't think that Jonathan had an organizing principle. I
31:05
Speaker 4: think he just went through his his thousand and nine
31:08
Speaker 4: columns actually was more than that two and he picked
31:12
Speaker 4: out just his favorite ones and then it fell to
31:16
Speaker 4: the three of us to organize the book, which which
31:22
Speaker 4: took some took some work, and you know, they were
31:24
Speaker 4: organized according to you know, the things that Jonathan wrote
31:28
Speaker 4: about I mean, you know, the principles of indexing, the
31:32
Speaker 4: importance of saving, how to calculate how much money you need,
31:36
Speaker 4: and then all of the behavioral issues that we that
31:39
Speaker 4: we talked about, and so I think we came up
31:40
Speaker 4: with seven or eight basic chapter headings.
31:44
Speaker 3: But also Jonathan did something else that was unusual and
31:51
Speaker 3: frankly risky, which is he wrote really often about his
31:57
Speaker 3: family and their issues with money. Particularly he I don't
32:05
Speaker 3: think Hannah and Henry would mind my saying this. He
32:08
Speaker 3: sort of used his kids as guinea pigs to test
32:11
Speaker 3: out how do you motivate children, to say, how do
32:15
Speaker 3: you get them to become long term investors? And we
32:21
Speaker 3: did not do this in my household. And on the
32:24
Speaker 3: one hand, I'm glad we didn't, because I think it
32:29
Speaker 3: can make your kids a little crazy if you turn
32:32
Speaker 3: them into lab rats. But on the other hand, his
32:36
Speaker 3: kids probably have a probably have healthier finances than my kids.
32:42
Speaker 4: Do, and healthier financial outlook too. I mean, Mike, I'm
32:46
Speaker 4: about a decade older than more than that than than
32:50
Speaker 4: Jonathan was, and so are my kids. In fact, you're
32:54
Speaker 4: considerably older than his because I had my kids later
32:56
Speaker 4: than he did. And a couple of the tricks that
33:00
Speaker 4: he came up with. I just like, God, damn, I
33:02
Speaker 4: wish I had thought of that. You know, when your
33:04
Speaker 4: kid asks for a soda, you know, the four dollars
33:07
Speaker 4: soda at the restaurant, it's like, I'll give you a
33:09
Speaker 4: buck if you take the water. You know, I'd be
33:13
Speaker 4: richer if I, you know, I brought to have a
33:15
Speaker 4: couple of grand I'd be a couple of grand richer
33:17
Speaker 4: if I'd thought of that one first.
33:19
Speaker 2: That's a great parenting hat. Share some others. What other
33:22
Speaker 2: financial tricks was he using that ended up having a
33:27
Speaker 2: good impact on the on the children either of you.
33:30
Speaker 4: Well, the bank of Mom and Dad. He closed that
33:33
Speaker 4: so instead of you know, you know, opening your wallet
33:36
Speaker 4: for the endless supply of five and tens and twenties
33:39
Speaker 4: when they wanted something, you know, at age eleven or twelve,
33:43
Speaker 4: he gave them ATM cards that he would load up,
33:48
Speaker 4: you know, at the beginning of the month, and then
33:49
Speaker 4: when the money was gone, the money was gone, and.
33:51
Speaker 2: That's until the next month.
33:52
Speaker 4: Yeah, and that's that's that's a great trick.
33:55
Speaker 2: I got to imagine a lot of parents are listening
33:57
Speaker 2: to this and saying closing the bank of mom and dad.
34:01
Speaker 2: What happens when they burn through the ATM in week one?
34:05
Speaker 2: Now you have three weeks of whining? How do you
34:07
Speaker 2: how do you manage around that?
34:08
Speaker 4: Yeah? That's that's tough. That's tough, monkies.
34:10
Speaker 3: Yeah, you ignore the whining.
34:13
Speaker 2: Apparently, plan better next month and we won't be having
34:16
Speaker 2: this conversation, right that that's really that's really pretty amazing.
34:20
Speaker 2: So it appears to me that Jonathan spent a big
34:24
Speaker 2: part of his career and I always hate this word,
34:27
Speaker 2: but democratizing good financial advice. It sounds like this initiative
34:33
Speaker 2: is the culmination of all of that, and and maybe
34:37
Speaker 2: further because he's trying to reach people that are normally
34:40
Speaker 2: completely ignored by the wealth management and mutual funds world.
34:48
Speaker 4: Yeah, I mean we you know, part of the problem
34:52
Speaker 4: that we have is is the behavioral problem of getting
34:55
Speaker 4: people to save. And hopefully, you know, this initiat, this
35:00
Speaker 4: research project will shed a little bit of light on that.
35:04
Speaker 4: That will that will help people you know, save in
35:07
Speaker 4: their own for their for their own retirement, both through
35:10
Speaker 4: employer plans and on their own.
35:13
Speaker 2: So, so let's talk a little bit about the behavior
35:15
Speaker 2: gap both of you have written about this. Jonathan has
35:18
Speaker 2: written extensively about it. Essentially, it's what people know they
35:25
Speaker 2: should do and then what they end up doing despite
35:28
Speaker 2: knowing what they should do. How do we, uh, how
35:33
Speaker 2: do we contextualize this behavior gap from Jonathan's perspective?
35:40
Speaker 3: Well, I think Jonathan did something really important, which is
35:46
Speaker 3: there was a firm which I won't name, that in
35:50
Speaker 3: the nineties used to say that the behavior gap was
35:55
Speaker 3: oh seven or eight percent a year for people who
36:00
Speaker 3: didn't use stockbrokers to buy their mutual funds. And in
36:06
Speaker 3: other words, if you were willing to pay an upfront
36:09
Speaker 3: sales charge to buy a mutual fund, you would end
36:12
Speaker 3: up earning a much higher return than somebody who didn't
36:16
Speaker 3: go through a stockbroker.
36:18
Speaker 2: Does the math bear that out?
36:19
Speaker 3: The math does not bear that. No, No, the behavior
36:24
Speaker 3: gap is real, but it's in nowhere near that big two.
36:31
Speaker 2: To three percent. Something along those lines are.
36:33
Speaker 3: Mostly a little smaller.
36:34
Speaker 2: I remember a Vanguard's study that specifically said for people,
36:40
Speaker 2: for people who have behavior issues, it's worth paying half
36:44
Speaker 2: a percent of one percent to somebody if it prevents
36:47
Speaker 2: them from making three four percent in eras I'm talking
36:52
Speaker 2: my book, they were talking their book. How do you
36:54
Speaker 2: perceive the ability for someone to talk and invent or
37:00
Speaker 2: off the ledge when every instinct in their body is like, no, no,
37:04
Speaker 2: we want to sell now because in March o nine
37:07
Speaker 2: or March twenty twenty, this is going to get much
37:10
Speaker 2: worse than this right now.
37:13
Speaker 4: Yeah, that's that's that's a completely separate issue than what
37:17
Speaker 4: we're talking about. I mean, you know what we're talking
37:19
Speaker 4: about is what is the gap? And the answer is
37:22
Speaker 4: it's not seven or eight percent. It's closer to one
37:25
Speaker 4: percent or one or one and a half percent, which
37:27
Speaker 4: is less than the cost of engaging conventional advice, certainly
37:32
Speaker 4: through a full service financial institution. The other issue, what
37:38
Speaker 4: you're asking is how do you prevent people from jumping
37:41
Speaker 4: off the ledge? And the answer is that's very hard
37:46
Speaker 4: to do because you have to be able to impart
37:48
Speaker 4: a sense of financial history to people, which is something
37:52
Speaker 4: that maybe one out of fifty investors takes.
37:55
Speaker 2: Seriously, that's a low the numbers are that low because
37:58
Speaker 2: I'm thinking about your quote about managing your own Olympics system.
38:02
Speaker 2: If you can't do that, you're going to die poor.
38:05
Speaker 2: Tell us about how all these columns and the book
38:09
Speaker 2: from Jonathan.
38:10
Speaker 4: Well, the Olympic system, very very crudely is system one.
38:13
Speaker 4: It's the fast moving system that you know, engages when
38:16
Speaker 4: we when we see that, when we hear the hiss
38:17
Speaker 4: of the snake or the see the yellow and black
38:20
Speaker 4: stripes in our peripheral vision on the African savannahs. We
38:24
Speaker 4: overcome it with our system two, which is our our
38:27
Speaker 4: thinking part of the brain, the neocortex basically, and the
38:31
Speaker 4: neocortex has to learn something about financial history, and good
38:35
Speaker 4: luck with that.
38:37
Speaker 2: Well, good luck with not only teaching it. But it
38:40
Speaker 2: seems that half life of financial literacy is really short
38:44
Speaker 2: that even if you teach people stuff, you got to
38:47
Speaker 2: keep drumming it in because events seem to move so fast.
38:51
Speaker 2: People kind of forget pretty quickly.
38:53
Speaker 4: Yeah, people, people you know, do learn when they get
38:57
Speaker 4: hit over the head by two by four, which they did.
38:59
Speaker 4: And wait two thousand and you know, Einstein is supposed
39:04
Speaker 4: to have said that the most powerful force in the
39:05
Speaker 4: universe has compound interest, which of course he never said.
39:08
Speaker 4: But the most powerful force in the financial universe is amnesia.
39:13
Speaker 4: People forget it.
39:14
Speaker 2: But what's the Galbrith quote? The one thing we learned
39:17
Speaker 2: about financial history is no one learns from financial history.
39:21
Speaker 2: So it's really true. So let's talk a little bit
39:25
Speaker 2: about this book, starting with first of all, who gets
39:30
Speaker 2: a terminal diagnosis and says, I know I will write
39:34
Speaker 2: a book. I mean, every one of us at this
39:37
Speaker 2: table have written more than one books, and I think
39:40
Speaker 2: we would all admit they're kind of a slog. Where
39:45
Speaker 2: did this come from? What was the motivation here?
39:48
Speaker 3: You know, Jonathan never told He didn't tell me he
39:52
Speaker 3: was doing it. I don't know if he told you.
39:53
Speaker 4: Bill, No, he did not.
39:54
Speaker 3: I only found out about it several months after he died,
40:01
Speaker 3: and I think it was part of how he coped
40:06
Speaker 3: with knowing that, you know, his time was limited. He
40:15
Speaker 3: just wanted to make the most of the time he
40:17
Speaker 3: had left. He spent a large part of every day
40:20
Speaker 3: with family and friends and you know, creating new memories
40:25
Speaker 3: that the people who remained behind when he was gone
40:30
Speaker 3: would be able to cherish. But I think he also
40:34
Speaker 3: spent part of every day doing what he liked best,
40:38
Speaker 3: which was writing.
40:40
Speaker 4: Yeah, where you ask Jonathan who he was and what
40:44
Speaker 4: he did, he would say, first of all, it's about
40:46
Speaker 4: my family, and then secondly, who I am is a
40:51
Speaker 4: writer and he could no sooner stop writing, as if
40:57
Speaker 4: he could stop breathing.
40:59
Speaker 2: So the book Money and Me combines a lot of
41:02
Speaker 2: writing he did at the Humble Dollar, as well as
41:06
Speaker 2: some fairly personal reflections on his diagnosis. Is this book
41:12
Speaker 2: very different in tone and goals and ambitions and his
41:16
Speaker 2: earlier writings. What are your thoughts on this?
41:19
Speaker 4: Yeah, it's a biography. It's a not a biography.
41:22
Speaker 2: It's a biography, but I, having not read it yet,
41:25
Speaker 2: I suspect it's a biography with a lot of insightful
41:30
Speaker 2: lessons learned along the way.
41:33
Speaker 4: Yeah. We covered a lot of those in the first
41:36
Speaker 4: segment of the interview, which is, you know, what's what's
41:40
Speaker 4: money for? What's life all about? What's the meaning? What's
41:44
Speaker 4: the meaning of life?
41:46
Speaker 2: You know?
41:46
Speaker 4: That's that's that's what he wanted to approach. He wanted
41:49
Speaker 4: to put a coda onto his life, and I think
41:50
Speaker 4: that's that's what the book was, for a CODEA.
41:53
Speaker 3: Yeah. I mean I I've been thinking a lot about
41:56
Speaker 3: this because I mentioned Jonathan and the writing he did
42:03
Speaker 3: at the end of his life in a book I've
42:07
Speaker 3: just finished of my own, and the way I sort
42:12
Speaker 3: of came out was that I think Jonathan took heart
42:19
Speaker 3: from giving heart. He gave heart to so many people
42:23
Speaker 3: in the last year of his life by writing incredibly
42:28
Speaker 3: candidly about what is it like to know you're dying?
42:34
Speaker 3: You know, what do you have to do before you're done?
42:39
Speaker 3: And how do you go about accomplishing everything you want
42:43
Speaker 3: to achieve in the very limited time that's left to
42:46
Speaker 3: you while retaining your dignity, while spending time with the
42:52
Speaker 3: people you love, And how do you set those priorities
42:57
Speaker 3: and how do you put all that in context? And
43:03
Speaker 3: Jonathan got not hundreds, but thousands of emails and letters
43:10
Speaker 3: from people who were dying, people who were taking care
43:14
Speaker 3: of loved ones who were dying, people whose loved ones
43:19
Speaker 3: had died, people who were afraid of death, people who
43:25
Speaker 3: had gotten a terminal diagnosis and then gone into remission
43:29
Speaker 3: or been cured completely, and over and over again, those
43:35
Speaker 3: people just it was this incredible outpouring of gratitude and love.
43:42
Speaker 3: And you know, the thing that I think is the
43:45
Speaker 3: biggest tribute to Jonathan is, you know, in the writing
43:50
Speaker 3: that I did about him in the last year of
43:52
Speaker 3: his life in my column and also in the newsletter
43:56
Speaker 3: I do for The Wall Street Journal, got. I easily
43:59
Speaker 3: got three four hundred emails myself. And the single most
44:04
Speaker 3: common thing that readers said about Jonathan was he was
44:10
Speaker 3: my friend. And they said that even though none of
44:14
Speaker 3: them had ever met him. They all said he was
44:19
Speaker 3: my friend. And it was true. He was because he
44:24
Speaker 3: really cared about the average person. He loved his readers,
44:30
Speaker 3: even the ones he'd never met, and he understood that,
44:35
Speaker 3: you know, when you're an individual investor, you're just like
44:39
Speaker 3: this little piece of plankton in a sea of sharks
44:44
Speaker 3: and barracudas, and you're at the bottom of the food chain.
44:50
Speaker 3: And Jonathan was their advocate. And then when he got
44:53
Speaker 3: that terminal diagnosis, he realized he could be an advocate
44:57
Speaker 3: for an entirely new group of people, you know, those
45:02
Speaker 3: who have been touched by by terminal illness.
45:07
Speaker 4: Yeah, he had an ability that almost no journalist has,
45:13
Speaker 4: which is that you read him and you say, this
45:15
Speaker 4: man knows my life. And even before he got his
45:20
Speaker 4: terminal diagnosis, you know, he quits City Corp. Around two
45:26
Speaker 4: thousand and eighteen or no, twenty fourteen or so, and
45:30
Speaker 4: he says, well, what am I going to do? I'm
45:32
Speaker 4: going to give back, And so he founds Humble Dollar,
45:36
Speaker 4: which you know, continues publishing even after after he's gone.
45:41
Speaker 4: So he's created something that's still you know, was very
45:44
Speaker 4: useful while he was publishing it, and it's still providing
45:48
Speaker 4: a service. So you know, I mean that his life
45:51
Speaker 4: was service more than anything else.
45:53
Speaker 2: Coming up, we continue our conversation with William Bernstein and
45:57
Speaker 2: jason's Wig discussing Jonathan Element's forthcoming book, Money and Me.
46:03
Speaker 2: I'm Barry Rittolts. You're listening to Masters in Business on
46:07
Speaker 2: Bloomberg Radio. I'm Barry Riddolts. You're listening to Masters in
46:28
Speaker 2: Business on Bloomberg Radio. My extra special guests today are
46:32
Speaker 2: Jason Zwig and William Bernstein. We are remembering Jonathan Clements,
46:38
Speaker 2: the Humble Dollar and Wall Street Journal personal finance columnist.
46:43
Speaker 2: He has a new book coming out posthumously, Money and Me.
46:48
Speaker 2: So let's talk a little bit about service, not just
46:51
Speaker 2: to his readers, but to his family. So if you
46:54
Speaker 2: preach delayed gratification and then you realize, hey, that window
46:58
Speaker 2: is only small, you then want some of that gratification.
47:04
Speaker 2: When I interviewed him after his diagnosis, he was planning
47:10
Speaker 2: a number of events and travel and other sorts of
47:13
Speaker 2: things with his family. Tell us a little bit about
47:16
Speaker 2: what he got to do in the last year of
47:18
Speaker 2: his life that he might have postponed under different circumstances
47:24
Speaker 2: until years later.
47:25
Speaker 3: Right, Yeah, I mean, obviously, you know, we should be
47:29
Speaker 3: respectful of Jonathan's privacy, but I think I can share
47:33
Speaker 3: most of this.
47:34
Speaker 2: He did, He did discuss a lot of it, and
47:37
Speaker 2: I'm assuming some of this is in the book, so
47:39
Speaker 2: I'm not asking for secrets. No, no, tell us what he
47:42
Speaker 2: was public.
47:42
Speaker 3: I mean, his son was planning to get engaged, and
47:51
Speaker 3: got engaged and got married, and Jonathan and his wife, Elaine,
47:56
Speaker 3: got to travel to London to you know, go the wedding.
48:00
Speaker 3: Jonathan himself accelerated his engagement and marriage to Elaine, his wife.
48:10
Speaker 3: He did, he did. He organized those things knowing that
48:15
Speaker 3: they were important to him and his family. And he
48:21
Speaker 3: also went on a bunch of trips with his mom
48:25
Speaker 3: and and his siblings, and you know, he had to
48:30
Speaker 3: cancel a couple of trips because he was at various
48:33
Speaker 3: points he was too sick to travel. But his siblings
48:39
Speaker 3: and kids would meet in Philadelphia, they would meet, they
48:45
Speaker 3: went to a couple other places together, and he just
48:49
Speaker 3: maximized the amount of time that he spent with his family,
48:53
Speaker 3: but also with his friends. I mean I visited him twice.
48:59
Speaker 3: An another mutual friend of ours from our days at
49:03
Speaker 3: Forbes Magazine went with me on one of those visits.
49:07
Speaker 3: Is this, to London, No, No, to Philadelphia huh unfortunately
49:13
Speaker 3: to Philadelphi. Philadelphia is great, Don't get me wrong. I
49:15
Speaker 3: love Philly, but London is maybe more is more fun,
49:20
Speaker 3: maybe for an American anyway. But he and I guess
49:29
Speaker 3: the thing I would point out, because I saw this firsthand,
49:34
Speaker 3: is that that may not sound like that being a
49:36
Speaker 3: deal to most people listening or watching us, you know,
49:40
Speaker 3: sort of like, oh yeah, your time is limited, so
49:43
Speaker 3: speed stuff up and make it happen. Making it happen
49:47
Speaker 3: isn't as easy as it sounds. I mean, you know,
49:52
Speaker 3: you're getting chemo, you're getting radiation therapy, you're getting you know, uh,
50:01
Speaker 3: surgical cement squirted into your spine, You're you know, you're
50:06
Speaker 3: getting cut open for this thing or that thing. Uh,
50:11
Speaker 3: you know, your hair is falling out eventually. You know,
50:14
Speaker 3: walking is difficult. And through all that, Jonathan was like, yeah,
50:19
Speaker 3: come on, you know, come next Tuesday. Uh, you know,
50:24
Speaker 3: I got nothing but time.
50:25
Speaker 2: No, nothing but nothing but time when you we all
50:30
Speaker 2: have limited time, and and he knows pretty pretty realistically
50:37
Speaker 2: how short that is. It sounds like this could be
50:41
Speaker 2: a morbid or depressing category. But uh, but knowing how
50:47
Speaker 2: he discussed things after his diagnosis, I have a sneaking
50:52
Speaker 2: suspicion that this book is more uplifting than depressing. Tell
50:57
Speaker 2: us a little bit about the tone he takes in
51:01
Speaker 2: what most of us would think of as really difficult circumstances.
51:07
Speaker 4: Well, most of the book doesn't cover his his terminal illness.
51:12
Speaker 4: That's maybe five that's maybe ten or fifteen percent of
51:15
Speaker 4: the book. And he does a beautiful job of describing
51:18
Speaker 4: just what Jason did. What he's really describing is his
51:21
Speaker 4: journey through the relationship between money and happiness and how
51:29
Speaker 4: he arrived at the place that he that he that
51:31
Speaker 4: he did. You know, the thing that that struck me
51:35
Speaker 4: when when I would go to visit him was and
51:39
Speaker 4: talk to him on the phone, was you know, I've
51:41
Speaker 4: been in the practice of medicine, I spent a lot
51:44
Speaker 4: of time talking to dying patients, and he was just
51:49
Speaker 4: the easiest person to talk to. You would you would
51:52
Speaker 4: you would get off the phone with him, you would
51:54
Speaker 4: come off away from a visit with him, you would
51:55
Speaker 4: feel uplifted. That's I can tell you that's not true
51:58
Speaker 4: most of the time.
52:00
Speaker 2: And does that translate into the book.
52:02
Speaker 3: Yes, yeah, I mean what I would jump in with
52:06
Speaker 3: Barry is that I think the I mean it may
52:10
Speaker 3: sound like a strange word, but the word I guess
52:13
Speaker 3: I would use his joy. I mean, Jonathan talked about,
52:21
Speaker 3: talked and wrote about dying from the most positive perspective
52:28
Speaker 3: you could possibly imagine. And you know, it's as if
52:36
Speaker 3: he really felt that he had lived the life he
52:39
Speaker 3: wanted to live, and above all, he wanted to go
52:45
Speaker 3: out on a high note, and he wanted to bring
52:49
Speaker 3: everybody along with him.
52:51
Speaker 4: Yeah, that was his great gift and his great endowment.
52:53
Speaker 4: We talked a bit about hedonic set point. You know,
52:56
Speaker 4: he just wasn't a glass half full kind of guy.
52:59
Speaker 4: He was a glass seven it's full kind of grind.
53:01
Speaker 2: Well, just that headline I remember it was the Journal
53:04
Speaker 2: or the Times piece Dying as easy, planning for death
53:08
Speaker 2: as hard, just is filled with that sort of mischievous
53:13
Speaker 2: sense of humor about something that everybody else takes very
53:16
Speaker 2: seriously and when confronted with it, it's like, hey, you got
53:20
Speaker 2: no choice but to laugh and plow ahead, And that
53:23
Speaker 2: seems to be what he did.
53:24
Speaker 3: Yeah. I mean, one of the lines he used that
53:28
Speaker 3: I'll never forget is and it was maybe the second
53:33
Speaker 3: to last phone conversation I had with him. He said,
53:36
Speaker 3: you know, when when I got my original diagnosis, they
53:40
Speaker 3: told me I had five to twelve months to live,
53:43
Speaker 3: and that was I want Now. I may not be
53:47
Speaker 3: remembering correctly. I think I think at the time he
53:50
Speaker 3: was talking with me, it was maybe thirteen months prior.
53:55
Speaker 3: And he said, so, you know, I'm I'm already playing
53:59
Speaker 3: in time. And I mean, I burst out laughing just
54:04
Speaker 3: the way you did. My friend is dying, and I'm laughing,
54:10
Speaker 3: but I'm laughing with him as he jokes about him. Yes,
54:14
Speaker 3: And and he wasn't. It wasn't like if that if
54:17
Speaker 3: that had been me, I might have been joking, but
54:20
Speaker 3: I would have been joking to like cover my fear
54:23
Speaker 3: and whatever. And he was joking because he thought.
54:26
Speaker 2: It was funny.
54:27
Speaker 4: Yeah.
54:28
Speaker 2: So, so there's a line from Howard Marx that I
54:30
Speaker 2: suspect reflects a lot of what's within this book. And
54:35
Speaker 2: I'm just curious as to your thoughts experiences, what we
54:40
Speaker 2: get when we don't get what we want and in
54:43
Speaker 2: the journey of the overlap between happiness and money and
54:50
Speaker 2: that then diagram which has I suspect less overlap than
54:55
Speaker 2: most people realize until they get that experience which might
55:00
Speaker 2: not be what they wanted. How, How has his journey evolved?
55:06
Speaker 2: How has his perspective Jonathan's perspectives changed about his thoughts,
55:12
Speaker 2: his thoughts about money, happiness, and the purpose of living
55:16
Speaker 2: a rich life.
55:19
Speaker 4: Yeah, I mean, I think he started out as a
55:21
Speaker 4: young man the way he describes in the book, with
55:23
Speaker 4: a conventional view of money, which is that, you know,
55:30
Speaker 4: money is to to buy things and to help you
55:32
Speaker 4: get by in life. When he started out his his
55:36
Speaker 4: career in journalism, he had credit card debt, he had
55:40
Speaker 4: student debt, and you know, probably all that he was
55:44
Speaker 4: thinking about was getting out from from under that. And
55:48
Speaker 4: unlike most people, he evolved beyond that very very very quickly.
55:53
Speaker 4: Uh to you know, get to the higher the higher
55:56
Speaker 4: uses of money that we've been talking about.
56:00
Speaker 3: Anything to add to that, I mean, I guess maybe
56:05
Speaker 3: the thing I would add, Barry is just that it
56:13
Speaker 3: takes a lot after all the years that I've been
56:16
Speaker 3: doing financial journalism to get me to feel I really
56:23
Speaker 3: learned something important because i've sort of, I guess I
56:29
Speaker 3: haven't seen it all, but I've seen most of it.
56:33
Speaker 3: And I really learned from Jonathan that, you know, how
56:44
Speaker 3: you live under sort of the ordinary conditions of daily
56:51
Speaker 3: life is one thing, but how you live when you've
56:57
Speaker 3: got a death sentence is something else. And he really
57:02
Speaker 3: shows that. I'm you know, you can still celebrate, and
57:09
Speaker 3: you should, and you should figure out how to comfort
57:14
Speaker 3: the people who love you in a way that will
57:17
Speaker 3: always console them after you're gone. And you know, the
57:24
Speaker 3: book really shows that, of course we're all afraid of dying,
57:29
Speaker 3: but we're probably afraid of it for the wrong reasons.
57:32
Speaker 3: And I think what Jonathan really showed is the thing
57:37
Speaker 3: you should be afraid of about dying is going out
57:41
Speaker 3: the wrong way, like not giving the people who will
57:46
Speaker 3: live after you the positive things that you can give
57:54
Speaker 3: them as gifts. And that's what he did.
57:56
Speaker 4: Yeah. And the other thing which he was aware of
57:59
Speaker 4: is he he realized he was a very positive person
58:02
Speaker 4: and that he was dealing with his terminal illness as
58:05
Speaker 4: well as any person could, and he was much more
58:08
Speaker 4: acutely aware of how much harder it was for the
58:10
Speaker 4: people around him, and he talked about that a lot,
58:13
Speaker 4: about about how hard it wasn't, particularly on his kids.
58:18
Speaker 2: That makes perfect sense. So so last question. If Jonathan
58:25
Speaker 2: were here, what do you think he would want the
58:27
Speaker 2: takeaway to be from the book about the relationship between
58:31
Speaker 2: money and a life well lived?
58:34
Speaker 4: He would tell you to figure out who the heck
58:37
Speaker 4: you are and what you really enjoy doing, and that's
58:42
Speaker 4: what the money is for.
58:45
Speaker 2: Sounds wise, Jason, you want to.
58:48
Speaker 3: I have I have nothing to add.
58:50
Speaker 2: Did we did we miss anything? Is there something I
58:54
Speaker 2: haven't brought up that you guys? Because I don't want
58:57
Speaker 2: this to be a morbid conversation. We're all solemn, but
59:02
Speaker 2: I know each of you have a long and positive
59:09
Speaker 2: relationship with Jonathan, So I don't want this all to
59:13
Speaker 2: come across as morbid, because just because it involves death,
59:17
Speaker 2: it doesn't mean it's said or morbid. What else do
59:21
Speaker 2: you want listeners to take away from Jonathan's life, his work,
59:26
Speaker 2: his books? What should people be aware that this isn't
59:30
Speaker 2: a downbeat book, This isn't depressing. We're being respectful, but
59:35
Speaker 2: at the same time, he was a happy, joyful person.
59:39
Speaker 3: We don't want to get into anything that's morbid, but
59:44
Speaker 3: you know, or when I was in My dad died
59:47
Speaker 3: when I was in college, when I was twenty two,
59:52
Speaker 3: and I remember the thing that he was most worried
59:57
Speaker 3: about as he like, as he lay dying, because he
1:00:02
Speaker 3: died of lung cancer. He kept saying to me, I
1:00:04
Speaker 3: don't want you to remember me like this, you know,
1:00:07
Speaker 3: as a sick person. And I kept saying to him,
1:00:10
Speaker 3: I'm not going to remember you like this. And I
1:00:13
Speaker 3: couldn't know that that was true, but it was. I
1:00:17
Speaker 3: don't remember my dad as a sick person. I remember
1:00:22
Speaker 3: him as this incredibly vital, physically strong, you know, mentally agile,
1:00:29
Speaker 3: impressive person. And what I will always remember about Jonathan
1:00:36
Speaker 3: is every time I think of him, I hear him laughing.
1:00:40
Speaker 3: That's the first thing that comes in my head. Is
1:00:43
Speaker 3: he didn't just laugh, He cackled, and his laughter was
1:00:49
Speaker 3: contagious and it never stopped. The last conversation I had
1:00:54
Speaker 3: with him, he was laughing at himself at how you know,
1:01:00
Speaker 3: dying with such a weird thing. And you know, if
1:01:04
Speaker 3: people only knew what it was like, could they, you know.
1:01:08
Speaker 2: They wouldn't fear it. They wouldn't well, they would fear
1:01:10
Speaker 2: it less. Well, gentlemen, I really appreciate you guys coming
1:01:15
Speaker 2: in to talk about the life and times of Jonathan Clements.
1:01:20
Speaker 2: It was a absolutely unique life, one that left behind
1:01:30
Speaker 2: a tremendous legacy for all of his not just friends
1:01:34
Speaker 2: and family, but readers, the ability to touch tens of
1:01:38
Speaker 2: thousands of people and in a very positive way. It
1:01:42
Speaker 2: is a very very rare thing. I hope people appreciate
1:01:47
Speaker 2: the conversation not as a morbid remembrance, but as a
1:01:52
Speaker 2: hopeful and uplifting one for somebody who left a very
1:01:56
Speaker 2: positive mark behind.
1:01:57
Speaker 3: Yeah.
1:01:58
Speaker 2: Well, thank you, gentlemen for being so generous with your time.
1:02:02
Speaker 2: We have been speaking with Jason Dwig and William Bernstein
1:02:06
Speaker 2: remembering the lifetimes and writings of Jonathan Clements in anticipation
1:02:11
Speaker 2: of his final book, Money and Me, coming out May
1:02:16
Speaker 2: twenty sixth, twenty twenty sixth. I would be remiss if
1:02:20
Speaker 2: I didn't thank the Cracked team that helps put these
1:02:22
Speaker 2: conversations together each week. Alexis Noriega is my video producer.
1:02:27
Speaker 2: Sean Russo is my researcher. Anna Luke is my podcast producer.
1:02:33
Speaker 2: I'm Barry Ridolts. You've been listening to Masters in Business
1:02:37
Speaker 2: on Bloomberg Radio