Latest / The Curve / The prenup boom, explained.

Transcript

The prenup boom, explained. · The Curve

• 0:00
  Very quick PSA, we've been nominated for a British Podcast Award, which honestly is just so baffling. If you have time, it takes 10 seconds, could you please vote for us? This would be huge for us as a business, a personal achievement. It would be amazing if we could win. So we will put the link in the podcast show notes. Please, please, please, can you vote?
• 0:19
  Coming up in today's episode, we get into prenups. They used to be just for celebrities and billionaires, but not anymore. More than half of people under 45 are now getting a prenup. And why? Well, it's being driven by women. Last week, Vic claimed she could make any headline interesting. So we will be putting that to the test with what sounds to me like perhaps the most boring story of all time.
• 0:42
  No, it's interest rates and it is very exciting news. And finally, one of the world's biggest companies has not had the most successful raise. They've basically issued $25 billion of bonds and not that many people are keen to buy them. So other cracks in the AI boom beginning to show.
• 1:00
  This is The Curve Weekly, where we read the finance news so you don't have to. I'm Vic Harris, a finance professional who has had a career making money for other people. And I'm Sophie Hall-Wright. I'm a TV radio producer who was really sick and tired of feeling stupid when it comes to all things money and the economy, so we started this podcast. But before we dive into the headlines, a word from today's sponsor.
• 1:22
  This episode of The Curve Weekly is made possible thanks to Pathfinder KiwiSaver Plan, helping you invest alongside your values. We're really excited to bring you the ethical hotline where you can ask all your tricky ethical questions. Each month, Pathfinder will answer the most interesting, popular or polarizing question. To submit yours, follow the link in the podcast show notes. Pathfinder Asset Management Limited is the issuer of the Pathfinder KiwiSaver Plan. A product disclosure statement is available at pathfinder.kiwi.
• 1:48
  Vic, how was your long haul flight? Yeah, no, it was good. It was just very long. I am still very jet lagged. It really rolled me this time. I don't know why. It's funny. I've been like quite amazing with jet lag. I should not say it out loud because I think that the same thing is going to happen to me. I'm going to all of a sudden be rolled. But I've had real luck avoiding it.
• 2:09
  I usually have my routine down pack, but this really, yeah, just a bit of a spanner. But that's all right. I'm hoping tomorrow will be, you know, today's the last jet lag day. Are you waking up in the middle of the night? Is it that kind of thing?
• 2:21
  Yeah, but only for like briefly and then go back to bed. It's more just feeling really like lethargic. So, yeah. I actually just think that's July. Bringing the energy to this podcast, you know? Same. Honestly, though, Vic, I think there's something happening. There's something in the air. Everyone's feeling exhausted. It's like a mid-year slump. Yeah. There's so many people I talk to. I mean, it's boiling here in London, so it's easy to say, oh, it's the heat wave. But I actually think it's more than that.
• 2:49
  I think everyone's just in need of a mid-year break, you know? Yeah. Like a little long weekend where all we do is sleep. I'm here for it. Finally. Also, sometimes I just feel like when you then talk to, like, young mums and you're like, I'm so tired. And you're just like, oh, shut up.
• 3:07
  Yeah. Shut it so fast. Know your audience. I know. I know. But how does it feel to be in the land of the long white cloud? Long white cloud. Tamaki re koutou. It's great. It is sunny. It's nice to be cold, actually. I never thought I'd say that, but good old weather chat, but.
• 3:25
  If anyone sees Vic in the wild, I'd love some videos, photos. No, I'm very incognito. I'm not here. I am like, I am hibernating. I am hit down, bum up. Yeah, I bumped into a friend yesterday. And she was like, what the fuck? And I was like, sorry, I didn't tell you I was coming back. So yeah, very. And even like. I love that you've not told anyone except like publicizing it on the phone.
• 3:48
  I know, I know. Sometimes you have to be tactful. It's really hard to catch up with people. I'm not here to catch up with friends. I'm here to work. Yeah. Sorry, guys. Next time. Strictly business. Pretend I'm not here.
• 4:01
  If you would like to hear how I am, listen to the podcast. Yes, it's a podcast. Yeah. Yes, right. Well, we have a new office. We have a new studio here, which we've moved into. Nice. I did it. I had this really weird, we put it in everyone's calendars to move as a team. And something came over me and I just thought, I'm going to do this.
• 4:22
  Off I go. And I came in a day early and moved everything around. And the team came in and everyone was like, did you do this on your own? I was like, I did, guys. I've been to two F45 classes. This was all me. So strong these days. Love it. But it's so fun. We've got a new view of London. It's bright. Is this the office across the hallway?
• 4:44
  Yep. We've moved a whole meter. A whole hallway. Yep. That F45's definitely come into use. Excuse me. Our desks are heavy. There is some heavy shit in this room. Yeah. But I was thinking, and it's such a boring take. There's nothing new about this idea. But there is something about newness, whether it's where you're living, where you're working, going to different exercise classes. I think just sometimes, and perhaps the sort of mid-year slump, just mix something up, you
• 5:12
  It's like when you were younger and you used to rearrange your room every like few months. Today I'm going to rearrange my room. And it would be like the big deal. I forgot about that. They were such a sad. I used to do it all the time. My parents must have been like, oh, not again. She goes, shuffling her head to the other side. I'll just put the bed to the other hall. Oh, cool. Yeah.
• 5:31
  Feng Shui. So we have, we've got some fun things to talk about. Well, one of them not so fun. Sophie was like, let's not talk about that. It is so boring. I was like, excuse me. Absolutely not. Interest rates. Interest rates and inflation are not boring.
• 5:48
  Literally last week, Vic was like, I can make any headline interesting. And then I got a look at the prep sheet and I was like, I'm not going to lie. I got past the first sentence and thought I actually tagged it. Vic, find a new story. I'm not interested. But apparently it's important. So we're going to be talking about it. So no pressure, but you'll be bringing the thunder with the way that this is positioned.
• 6:08
  Well, maybe I should delay it for another episode because I am not bringing the thunder today. You've got this, Vic. I believe in you. No, but interest rates and inflation, they're important. They impact us every single day. They impact so many aspects of our lives. And yes, yes, they're boring, but they're also like...
• 6:29
  They're not. Okay. Look, we're going to park that. I'm not going to lie. I'm still not sold. However, this first story talking all about prenups, I'm 100% here for. And yeah. Prenups. Do you have one? Or would you have one? I am not married, Sophie. So no. Sorry. I do not have a prenup. But you're probably close to being in a de facto. Yeah, probably. Probably.
• 6:54
  I probably should practice what I preach, right? It's so funny because I think a lot of people assume. Or just break up with Salman. Oops. This podcast, imagine. He's like. You're at the two-year limit. Bye. See you. But I have a lot of friends talk about, like they'll bring money conversations up and they'll just assume that I've had them or that I'm really across it. And I think it's very important to just preface that.
• 7:20
  I mean, I'm in a new relationship, so it's very different to you. You've been with Flower Man for like, gosh, nearly three years. Different, you know. You've weathered some storms. You've had a lot more change in, I don't know. You're a bit older in terms of the relationship. We've been through some interest rate cycles. We've gone through a cost of living crisis. Inflation. You've seen it all. Inflation. We've seen it all.
• 7:42
  But I, you know, we've had conversations about prenups, the importance of them, how they, like, you know, you basically have one regardless of if you draft something up yourselves because there's one legally by, you know, in every country. So Grace Beverly put this so well. She was like. Okay, okay. She was like.
• 8:02
  In what situation, a business deal, whatever it is, any transaction, do you just take the contract as given? You don't even look at it. You just sign it without even looking at it and boom, it's done. She's like, never, ever. You would always read the contract, even if it was like a high level, you know, skim over. And why is...
• 8:24
  prenups any different. You're effectively signing a contract that you haven't even had a look at because if you don't have a prenup, that's the default contract is whatever the kind of the law is in your country. But when she said that, I was like, it's so true. All we're doing is adjusting an existing contract.
• 8:41
  that's in place to to be a bit more personal rather than like the status quo that everyone gets so it's just it's so interesting when you frame it like that actually before we get into the personal side of it and we can share the conversations that we've had and how we feel about it but let's just do an overview as to why this is in the news at the moment and and why we're talking about it
• 9:01
  So prenups have gone from being taboo to being totally normal now. And women are driving that change. So 53% of engaged or married Americans under 45 years old now have a prenup. So that's over half. And that's up from 34% just a few years ago. So that's massive. Over half of young people now getting engaged and married are getting a prenup.
• 9:30
  Do you think that if we extrapolate out the changes that have happened societally in terms of the age that people get married...
• 9:40
  the stage in which people meet each other. I think, you know, even 50 years ago, the average age of getting married was 21. And at that time, a lot of women weren't working. So coming to a relationship with, you know, you're starting from ground zero. I think so many of us are meeting partners later in life. And so you've already created a lot of
• 10:02
  You've already established a lot of, some people have a lot of wealth, some people have none, some people have lots of debt. It's a completely different ballgame when you're 35 to when you're 21. Yes, you're right. People are now marrying later. They've got longer to kind of accumulate assets and women are also earning a lot more now than they were. So it's like those conversations are...
• 10:28
  Less like you take what's given and more like, no, hang on a second. I've actually got a bit of wealth that I want to protect of my own. So I actually reached out to a couple of lawyers who are really expert in this space. And it's so funny because I've listened to so many podcasts, read so many articles. I know that.
• 10:52
  that it is so clever to have these conversations and make your setup within your relationship one that suits you based on the conversations you have, what you think is fair, etc. And I'll play one of the voice notes in a second. But...
• 11:09
  I think the thing that's kind of interesting is asking yourself, what is the worst case scenario? Like what is something that you, if you broke up and it ended, what's the thing that would sting the most? What would that be? And I won't play this particular one that referred to this, but one of the lawyers, Lauren, that I was, I was WhatsAppping, she's a friend of a friend. And she was saying, you know.
• 11:32
  For example, the curve, if you separated and you've put your heart and soul in 10 years of your working life into it, would you be bitter if you then had to split that 50-50, you know, if it sold at some point in the future? And I was thinking about it and then I was sort of like, I don't know, just like spiraling down my own thought pattern with it. And I was thinking, do you know, I think for me,
• 11:57
  I think the only setting that would be really, really upsetting is if the relationship ended because, say, my partner went and cheated on me and left me for another woman, for example. And we had kids together. And, you know, it wasn't my decision to leave. And it kind of essentially ruined my life and what I wanted. In that case...
• 12:22
  Yeah, I wouldn't want to go in there. No. But if we fell out of love and it was really amicable and we'd built this beautiful life, but we'd just come to the end of our relationship cycle, I think it was really different. But what if they had been supporting you and taking part-time work for the last 10 years to help with the children so that you could build this business?
• 12:46
  and create this wealth. And then, yes, they cheated, but they'd still made lots of sacrifices over the last 10 years. I don't know. I'm not. No, and this is exactly the absolute spiral I went down because I thought if I go and put these things in place in a contract –
• 13:02
  you are in business with your partner. And you are regardless if you make your own one. We've talked about this a lot. The default government prenup is there. So you are in a contract regardless. Getting married is a legal binding. It's not just you love someone, you're committing to them. You're actually in a small business with your partner. And if you then have in your prenup, if you cheat on me, this is the financial implications,
• 13:28
  You don't want someone staying in a relationship because they know the financial fallout is worse than if they just stay with you. Do you know what I mean? I was like, oh, no. How do you deal with them? Oh, no. If I cheat on them, I'm going to lose two million. So I'll just stay. But seriously.
• 13:44
  Yeah. You know, it's such a weird thing to think about. It's interesting. I had an appointment today and the lady was like, oh, you're from the curve. And then we were just chatting and she was like, she had bought a house when she was young and with her partner at the time. And then they broke up and he took half. And she was very, she was more just like, I just want him out emotionally. See you later. She had paid for the house herself and he obviously got half kind of for free. Yeah.
• 14:13
  And she said, I am more bitter about it now. Like, I think it's 10, 15 years on, maybe 20 years on. She's like, I'm more bitter about it now than I was back then because I know that money compounded over those years could have created me way more wealth now.
• 14:31
  And I am mature enough and knowledgeable enough now to understand that. Whereas when I was younger, I was like, I've still got this, still got half, you know, it's still a decent amount of money. And I was young and naive and I just wanted, you know, the whole thing to be done. And I was like, that's so interesting.
• 14:48
  Well, I think that that is such a good point, though, and that's why so many lawyers say have these conversations now because when you are tapped out and exhausted or really heartbroken or, you know, for whatever reason, a relationship ends, you know, you're not.
• 15:04
  At least you've thought about those things. You know what the plan is. You've decided that when you're in a better state of mind. But I think that it's so easy to say this sitting here. And it's the reality of having those conversations is really hard. And as someone who has a financial podcast, I am...
• 15:21
  not having those conversations I had no I'm just reading it which is crazy I also think the reason more people have got prenups now as well is because it is easier and cheaper like there are so many platforms now where you know it does make it a lot more accessible which is great just like investing you know there's a lot of DIY platforms now where you can invest super easily and so I think it's great it's great that
• 15:47
  It's more accessible. It's great that people are doing it. It's great that we're having conversations like this. And it's just like preparing yourself for hopefully what won't happen, but yeah, putting the foundations in place in case it does.
• 16:00
  But actually, Vic, even to your point about you're entering in a contract regardless if you've made it bespoke or not, you know, and there's no world where we would ever sign a business contract for the curve without being meticulous with the small print. I mean, the amount of back and forth that we've had in so many settings and we would have – because we actually – because we got burnt once, we really learned –
• 16:25
  how important it is to pay attention to all the different scenarios. But if you then went into a, if you think about it in a business sense and there's 50% of people end up divorcing and you had those statistics laid on top of a business contract, can you imagine how we would have a magnifying glass? We would have highlighter. We'd be having team meetings for every line of the contract. You know, yeah.
• 16:49
  Yet we don't with our relationship contracts. I know. No, I do love with this new story is that it's women that are driving this. And I just, that part of it, I'm like, is, you know, we're not just agreeing to the status quo anymore. And I do love that.
• 17:07
  yeah the main driver of this is is woman and it's so great to see well for anyone that's interested in getting a prenup or or you want more details about how to contact the right person our website is about to launch which we do have like curve recommended experts but it's not live yet so if you would like to get in touch with someone whether you are in a relationship already married you you
• 17:30
  A lot of the lawyers that we speak to and a lot of the people that we work with often talk about the importance of a prenup being a live document. It's not something that you do and then you just like tuck away in a drawer. It should be something when your relationship changes, you then revisit. Does this still match where we're at and what we want? If you do want details, just email us hello at thecurveplatform.com and we'll get back to you with some personal contact so that you can get in touch with the right people.
• 17:52
  Also, it's not just for people that earn a lot of money either. Like prenups, there are so many more women now being like, hang on a second. I'm stepping back from my career. I want protection. Like you're so right when it's a live document. It's like, no, hang on a second. When we have kids and one of us has to step away, how does that change the prenup? And like all of those things come into it. So don't be sitting there going, I don't earn enough to have a discussion with my partner or I don't earn enough to get a prenup. It's absolutely balderdash.
• 18:22
  If you're listening to this and you are thinking, I'd actually really love more details on prenups, on how to have conversations with partners, I've been really thinking about this as almost like some kind of a mini series or to do more content on. I think that it's just so not, it's not as straightforward as just get a prenup. So if you're listening to this and you think that would actually be really helpful, can you just comment? I don't even know if it's just emojis if you feel embarrassed to do it publicly.
• 18:45
  um wherever you're listening to this podcast and if there's lots of people that are interested in it i'll start doing some planning on what that could look like because i i personally am like can we do this for me like i i would i i mean honestly even like a list of questions that are really important to get on the same page with before you then go to a lawyer to say i think i want a prenup because if you go to a lawyer and then you can't answer their questions because you haven't had those conversations it's sort of like a bit of a cart before the horse situation
• 19:19
  Okay, this next news story, how long do I have? I can do it in a minute, two minutes. Give me two. Is this your interest rate story? Yeah. Look, I will tell you, I'm going to start doing, I'll start singing Oscar music if I am getting bored. And you can quickly wrap up. Okay. But I am open to you changing my mind on this being an important story and something I need to know about. Okay.
• 19:43
  So no pressure. So three countries, New Zealand, UK, Australia, we've had one giant oil shock and there is three completely different moves in all three regions. Firstly. Okay. You kind of have me. I'm not going to lie. Good start. Good start.
• 19:59
  Firstly, New Zealand. So we've just done something in New Zealand that we haven't done since 2023. 2023? I said they're really weird. Honestly, I thought you were going to say like 100 years ago. That's three years ago. Yeah. But we've put rates up. We've put interest rates up. Australia has already been rising its interest rates, and it's kind of paused to take a breath. And in the UK, it has been sitting on its hands since about December last year. So three different approaches –
• 20:28
  But we're going to go back to New Zealand. So New Zealand – Hey, wait. Pause. Pause, pause, pause. I'm trying. It's fine. No, you're really doing such a great job. I'm actually not that bored yet. So I would just say take a deep breath. Yeah. You can slow down slightly. We do need to know about this. I know that you're not just doing it because you think it's fun. So you have a few minutes. Don't panic. I think let's just – yeah. So sorry. So basically three different moves. So New Zealand has raised interest rates. Yeah.
• 20:54
  UK has done nothing. What did Australia do? And Australia was kind of first to rise, first to raise, and now it's kind of taking a breath. So the key thing in New Zealand, though, is that mortgage rates, so when you increase interest rates, when the country increases interest rates, whatever country it is, usually mortgage rates follow because, you know,
• 21:16
  that's, you know, the banks are, there's kind of the central bank dictates what all the other banks do. So when interest rates go up, really good if you've got money saved in the bank because your term deposit rates go up. Not so good if you've got a mortgage because your mortgage rates go up. So what we're seeing though in New Zealand is that mortgage rates are not going up. So interest rates have gone up, but mortgage rates aren't really moving. And it's because this is kind of all expected. So banks have like,
• 21:43
  teams and teams and teams of economists that look at inflation, look where it's heading, and they can see, okay, the likelihood of the central bank, the big King Hontro Bank putting rates up is pretty high. So we're actually going to move our mortgage rates ahead of time. Anyway, so it's not like, I guess, a one-for-one where interest rates go up, mortgage rates go up. It's not but over time.
• 22:10
  over the majority of times it does. So basically the decision makers, the big economists that are trying to look at what's going on, what's happened with all of the oil sagas is, okay, what does the economy need for this to not have flow on really negative impacts? And Australia and New Zealand have decided raising interest rates is what we need to do. Because raising interest rates means... It means you're kind of trying... Borrowing comes down, right? People spend less.
• 22:40
  Yes, yeah, because if you wanted to go and borrow money and get a mortgage or get a business loan, it's more expensive. So it slows down the economy because people aren't going to get loans to start businesses, purchase houses, all of that. So it slows down the economy. And also people are like, oh, well, I'm getting quite a good interest rate in the bank, so I may as well just keep it in the bank as in savings. That's right. Yeah.
• 23:08
  So increasing interest rates slows down the economy, which is kind of a bit tricky in New Zealand right now because things aren't doing too well. But it means that it also slows down inflation because oil prices, yes, they've come down, but there's still these lag effects that are coming through in terms of inflation that we're seeing. So, yeah.
• 23:31
  So why would the UK not raise interest rates? What are they seeing? Why are they deciding that they don't want to slow the economy? Because the economy is… They don't want to slow the economy. Yeah, essentially. They don't want to slow the economy. Like the economy is struggling pretty bad in the UK and the property market and everything.
• 23:49
  But then if you look at the New Zealand market, like you're saying, it's struggling too. It depends also what's driving that. Like in the UK, it relies on a lot of imported oil. And so the energy price affects inflation a lot more than, say, New Zealand would, for example.
• 24:04
  But there's so many things in play. It's not like, and a lot of countries have different other levers they could pull, like tax, for example. So it's not just interest rates that could fuel or contract an economy. It's also there's other fiscal things, which means just they can use taxes to their advantage.
• 24:25
  Yeah, I think we round out the story now. I can see I'm losing some interest. Some glaze over. Yep. Yeah. Yeah, but can you just, what I would like to know is what is your take on this? Like, why is this a story that you wanted to have included today? Like, what are we noticing about New Zealand and Australia raising interest rates, the UK not? Is it more just the fact that...
• 24:49
  The overarching concept of inflation means everything gets more expensive. Because oil is in everything, countries are worried that the flow on of the oil crisis is going to make everything more expensive. And so like... Yes. And also, but you're in a tricky situation because a lot of countries like the UK and New Zealand in particular are not doing well. So you've kind of got this dichotomy of, shit, we've got inflation, but we've also got the economy not doing too well. It's the stagflation. Yeah.
• 25:19
  Yeah, what do we do? But if we put up interest rates and slow down the economy too much, that's negative. But if we reduce interest rates and then inflation runs away, then that's going to have a negative impact. So you've got to be very, very careful.
• 25:36
  Coming up off the break, we talk about Amazon, who has just raised $25 billion by selling bonds. What does it say about Amazon? Where is it going? What's it doing? We dig into the details.
• 25:50
  But first, we've got a quick word from today's sponsor. A recent study Mindful Money did found that 50% of New Zealand investors are worried about greenwashing. And honestly, I get it. It's really hard to know what to trust these days. And that's why we've partnered with Pathfinder KiwiSaver Plan, because they make ethical investing understandable and accessible.
• 26:08
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• 26:35
  So Amazon, not the river, the...
• 26:40
  What would you call it? Oh, wow. Thank goodness you clarified on a finance podcast that we're not talking about. The Amazon River. I've actually been down the Amazon River. No, you haven't. I have. In my South American tramping. The only trip that ever gets mentioned. I know. This one time? At Bandcamp? I can't believe that. That's so cool. What was it like? Yeah, it was a big river. Do you remember it?
• 27:10
  We went into the Amazonian jungle, saw some tarantulas, saw some, yeah, lots of things. Wow, it's kind of amazing. Yeah. It is in hindsight. I think, yeah.
• 27:21
  I just don't think any, no good experiences should be had under the age of 30 or I will have forgotten them. You know, like think back to all the fun stuff I did as a kid. And it's, it's diabolical how horrendous my memory is. And also what you remember from those trips is like so meaningless. Like I remember when I went to Japan with my dad and all I remember is the flight over and the green tea.
• 27:47
  You know, like it's just. I remember those lollies they pass out on the plane. And I just remember being devastated when I wasn't picked to be the lolly girl to like walk down the aisle and hand out the sweets. Yeah. I also, the only time probably in my whole life that I will ever experience flying business class when I was like four. And now you're like. Probably. Why? And now it's like I would do anything. Honestly, I would walk down London Fields, Broadway Market fully naked if someone said you could fly first class.
• 28:17
  your next flight. I would honestly do that. We're not talking about the Amazonian jungle. We are talking about Amazon, the massive marketplace. They raised $25 billion by selling bonds. But for the first time ever in this kind of AI craze that we're seeing, investors weren't that overly excited about it. And so I'm going to dig into kind of why. So a bond is essentially an IOU.
• 28:47
  would you like to lend us some money? We'll pay you back. And they did it and there was kind of bonds for three years and bonds for 40 years. They were like, we'll pay you back over these periods of time with interest, but we need you to lend us the money so that we can invest in AI. Yeah.
• 29:05
  So let's just talk about this for one second. So they're doing an IOU. The reason that they'd be doing an IOU, aka a bond, rather than actually doing equity and letting people buy their shares, is that a good, like a green flag from an investor standpoint? Because they're wanting to hold on to the equity.
• 29:24
  rather than, it's like they're taking on debt and paying interest through the IOU or the bond, rather than letting people buy shares? Like, is it a green flag? It's not really green or red. It's just a different way of getting money into the business. You can fund a business through debt or equity. The thing with debt is...
• 29:46
  There is, you have to pay it back. So there's kind of, I guess, a vote of confidence of we believe that, you know, this part of this bond was for 40 years, you know, that we can pay this back. They're so confident that they can pay back that $25 billion. That's how I kind of see it when companies issue bonds.
• 30:10
  And I guess also like when someone's doing a bond or an IOU, it's generally a really stable company because it's a more reliable return. So they can almost guarantee, I think that is the whole thing, right? So they might be like, you lend me $10 and I will give you a $2 interest every year or whatever. The smaller companies or the riskier companies, they've got to pay higher interest because they've got to entice people to lend them money. So if you're a government organization or like a,
• 30:38
  you know, a council and you're raising money to build a playground or a hospital or something, you know, like the likelihood of those organisations of governments disappearing, very, very low. So therefore, they don't have to entice you with a high interest rate. Whereas if it's a smaller business, like, okay, this is not a very proven, trustworthy, longstanding business. Yeah.
• 31:03
  therefore to like entice or get someone to invest or give them money in IOU, the return or that interest that that business needs to promise is going to be higher because it's riskier. So the whole idea of like –
• 31:16
  risk equals return or you know the risky you are the higher you have a chance of getting better returns it's not that risky given a government money compared to something else so also a government can't issue equity like it's it's not true you know it's like it's and neither can like city councils or anything like they can't be owned by true so they they have to do it that way essentially but
• 31:41
  Yeah, it's like if a startup was like, hey, we're going to issue a bond and we'll pay you back in 40 years. I'd be like, hang on, you've only been around for one. Why on earth would I think, you know, the likelihood of you guys being around in 40 years? A lot of these big tech companies have raised money through issuing bonds and raising equity. But...
• 32:02
  The reason this one is kind of getting a bit of attention is that the demand for it was kind of 1.6 times the deal size. So $25 billion and demand was $41 billion. But historically, it's been about four times. Whenever these big tech companies have raised money through debt or through issuing bonds for this AI boom,
• 32:28
  the demand has been like quadruple what they need. And so we're starting to see people are getting a bit fatigued and like it's kind of a lot of the demand has been lapped up essentially. And so the fact that Amazon, one of the biggest tech companies in the world, has seen, yes, it was still over demanded, but it wasn't at the rate that we've previously seen is kind of what, not setting off alarm bells, but...
• 32:54
  We've had a bit of a volatile market over the last few weeks. And so people are getting a bit nervous now with this, seeing the kind of the lack of intense demand for this bond deal from Amazon.
• 33:08
  So do you see this as a red flag for, I don't know, AI, for tech companies, for stock market? What other interpretations are there in terms of, yeah, there's a lack of interest, but what are we meant to take from it? I think it's just highlighting the kind of the fatigue we're starting to see with AI. Like we've seen such exorbitant, exorbitant changes.
• 33:33
  Exorbitant? Exorbitant demand and interest and stock price movements and overall market movements. And now people are like, there's got to be an end to this. There has to be, and I'm not saying an end like a gigantic bubble burst. I'm just saying there's got to be some...
• 33:53
  rationality to it, right? Like there, you can't just have demand go up and up and up and up and up and up forever and ever and ever. Like there's got to be some kind of plateauing. But to put this in perspective, so...
• 34:07
  This year alone, AI-linked bond sales have been over $335 billion. And that was more than double what the value of bonds that were issued due to AI in 2025.
• 34:24
  So like we are seeing like huge, huge numbers come through. And yes, the numbers that we're seeing in terms of the overall spend that's needed on AI data centers, for example, is like multiple times the size more than that. But it's just another indicator of like, hang on a second, people aren't just flooding into this with their eyes closed like they kind of felt like they were for the last few years.
• 34:54
  But do you think it could also be that since we've had these enormous IPOs and there's been all this other money sucked out of the market that people just don't have money left to invest? There's actually not like it's almost like the trough has dried up. You know, all these companies linked to AI, all these AI ETFs, all these, everything has gone up so much. It's like, OK, is it going to do that again or is there going to be opportunities elsewhere? And I think people are like, you know what, I've made a lot of money.
• 35:22
  Is there something else? Is there another theme? What's next that could be the next AI boom? And I'm not saying that I think it's falling off a cliff or anything like that. I think we probably still have plenty of runway to go in terms of demand, in terms of AI and what it can produce. I just think people tend to get ahead of themselves when it comes to investing in very kind of hot FOMO spaces.
• 35:51
  Vic, something I've been wanting to ask you, I've been seeing a lot of content from big investment firms or content creators. There was someone recently on Driver CEO, Nisha's YouTube, and a lot of the conversation is sort of –
• 36:06
  I mean, the headline really is divest from the US, you know, like get out of the S&P 500. Do not invest in America. Re-strategize, think about where your money is. Is this something that you have been looking at yourself and thinking, yeah, do you know what? Maybe I want to be more diversified than I have been. Do you have any hot takes on that?
• 36:33
  I think it's like, you're so right. You're like, I'm seeing the headlines, right? Headlines sell. Headlines are what is like attention grabber. And that's what people, it's like clickbait. You know, that's what people click on to like see the story. I think if we, yes, you should always diversify. And we spoke about, you know, the first six months of this year, international markets and emerging markets have actually done very well versus the US. So there is, yeah.
• 37:00
  validity. Validity. She's jet-lagged, Tim. She's jet-lagged. You're doing an amazing job, Vic. You're really carrying it. There is validity. Oh, my God. Validity. There is validity. There is validity in diversifying and investing your money outside of the U.S., but...
• 37:23
  I think I would love to ask those people, what is your timeframe that you're referring to when it's like pull your money out of the US and invest it elsewhere? Like what is your timeframe here? Are you talking about the next year, the next two years, next 10 years? And also if the companies like Amazon, Google, Apple, Microsoft, if all of those companies are going to absolutely shit themselves, we are going to have bigger fish to fry than thinking about where to put our money.
• 37:51
  The way you make a name for yourself in investing is you have these big calls of the, it's an AI bubble. It's going to burst. It's going to, you know, like. And if it's right, you're the one that called it. Totally. If you're wrong, nobody gives two shits. But if you're right, then, so everyone wants to come out with like, I could sit here and be like, oh, I think that GameStop is going to be, you know, the most incredible, you know, it's like the, yeah.
• 38:18
  You want to make a huge call and come out with it. And then if you're right, it's like you're the best investor of all time. Where part of it's probably luck. For Wednesday's episode, I would love to put a request in. I would like to pretend that we're at a club and it's one in the morning. And I'd like Pitbull played or Dua Lipa electricity. Okay, noted. Okay.
• 38:41
  So there's two stories that I have seen headlines floating around that I would really love. Let's do it. On Wednesday. So one, one is something about billionaires avoiding tax and how they, basically the dilemma that governments have about not knowing how to tax billionaires, how they just like leave and go to a new country and they're such a huge part of the economy. And so they...
• 39:07
  Something about they need to, we need to figure out how we can actually tax billionaires. And I have a few links to send you for your research. That's one story. The second, Taylor Swift and Dua Lipa have both gotten married basically in the last month. And I am absolutely fascinated by how much they spent. What are their prenups? Like, I want to do a sort of celebrity deep dive on the financials of their wedding. Yes, we can do that. 100%.
• 39:34
  Thank you so much for listening to The Curve Weekly. Make sure you hit subscribe or follow wherever you're listening so you're always up to date with the latest finance and investing news. And feel free to leave a comment to let us know what you thought about this episode because we would love your feedback. We've got new Curve Weekly episodes for you to listen to every Monday. But until then, listen to Erasing the Curve. These are our in-depth podcast episodes where we chat about all things money. We're also around all week on socials if you're hungry for more Curve content and all the links are in this podcast's show notes. We hope you have a great week and we'll catch you for the next episode of The Curve Weekly on Monday.
• 40:04
  Bye.
• 40:12
  Okay, quickly, the curve was created to empower and educate you about investing, but we are not financial advisors. Our platform exists for educational purposes only, and it doesn't provide personalized investing advice for your individual needs and should not be relied upon to make an investment or financial decision. And always remember to do your own research before making any investment or financial decision. We're here for any knowledge and support you need, but the final call is always yours. And thanks for being here. You got this. Yeah, we know you got this.