The Prof G Pod with Scott Galloway
00:06:51 · Scott Galloway
You wanna talk to friends in the real estate industry and see if it makes sense for you to buy a home. Having said that, real benefits, psychic benefit, and also the economic benefit not captured in Schiller's analysis is the following: if someone says to you you need to spend $2,100 a month and put it into a Vanguard low interest index fund, You get an opportunity to go to Cabo. You think, oh, you know, I really would like to upgrade my car. And okay, you don't put the $2,100 that month into Vanguard. People typically make their mortgage payment, and that is it's a means of forced investment, which is good for younger people. It's good for all of us if we're trying to you know, you don't want to have your house repossessed. So you tend to plan and impose a certain amount of self discipline around investing in an asset that does grow. It may not grow as fast as the S and P nationally over a long period, but if you get lucky in certain areas it does grow as fast or even faster. And also it's really tax advantaged. When you sell it, you 250,000 or 500,000 if you're married of tax free income on the upside of the sale. It also against the above mortgage interest rate tax deduction. So there's psychic benefit, it's forced savings. So I do think housing is an enormous issue for The United States. The thought of unleashing kind of the private sector, while also reducing, if you will, the ability or the inability, unshackling the housing market through economic incentives, and also pulling down or lowering the bar on what can get built by national and local NIMBY laws. The big mistake we make in housing is believing it's a demand problem flooding the market or buyers with additional tax credits, which just gives them more money on the same base of supply, which drives up the cost. The issue is a supply problem, and we need to refocus our attention on the supply side versus the demand side. I appreciate the question. Question number two comes from Jackson who emailed us. He says, hi Scott, you've talked about selling Netflix at a loss early on, and selling real estate in Potrero Hill, and I imagine those kinds of missed opportunities haunt you differently than a straight up bad bet. I recently sold a large position in a big tech company I worked at for six years, forced to liquidate to close on a Brooklyn townhouse. The stock has since run up significantly.
00:09:13 · Scott Galloway
I know the sale was the right call for my family, but the number is real and it stings. How do you mentally separate? I made the right decision with the information and constraints I had from the raw regret of watching the gains you left behind. My brother, get used to it. It's just the cruel truth of capitalism is you're gonna have a scarce amount of resources. At some point you're probably gonna decide that it's worth it to send your kid to a great school that he or she got into that just costs an arm and a leg, and you're gonna have to sell stuff. And some of the stuff you sell will go up in value. Now the way you console yourself on a very existential level, or how I console myself, is that something that just changed my life is my colleague at NYU Adam Alter studies regret, or one of the things he studies regret. He spent a bunch of time in palliative care and interviewed people who were at the end. These are people that have zero fucks to give, have real perspective around the end of their life. And their biggest regrets in reverse order are number three, not staying in closer touch with their friends. Two, not living the life they wanted to lead. Not one, their parents or society or their spouse or themselves wanted to lead, or felt they should lead instead of living the life they actually wanted to lead. But the number one regret of people at the end, are they wish they'd been less hard on themselves. I'm like you. I have a tendency to focus on all my mistakes. I did a speech at UC Santa Barbara on Friday, it went so well, and I'm happy about that. But I'm mostly fixated on the one or two things I could have done better, or I said something stupid or provocative, or I dropped an f bomb where I really didn't need to. That's what I obsess about. And that's part of being I think successful, is really trying to get better at something and recognize your mistakes, I have a tendency to dwell on them. Anxiety is about fear of the future, and depression is about fear of the past, or upset over the past. And by the way, okay, the stock has gone up you've sold, but so likely has the value of that Brooklyn home you purchased. It's not like you took the money and put it in treasuries, or invested in another stock, or invested in Nike, which got cut in half in the last year, or Netflix, got cut in half the other year.
00:11:32 · Scott Galloway
You invested in Brooklyn real estate, which I think over the last twelve months has gone up. In addition, you've invested in your family. Working at a tech company and selling the stocks, let's say you can buy a home in Brooklyn or Brooklyn townhouse, my brother, it's good to be you. That's what you call the mother of good problems. That means you're in a relationship. That means you probably have kids. It means for God's sakes, you had the money in the stock to afford a townhouse in Brooklyn, which probably puts you in the top 1% of Americans. So this is a really good problem, my brother. Whenever you sell stock, it's just very unlikely that you can time the top and time the bottom. You need to time your life, and that's what you've done here. You needed the money for your family, for a townhouse. You've probably made money in that townhouse already. Maybe not as much as this tech stock you sold, but okay, it sucks to be an adult. This is not, is not, this is an inconvenience, not a problem. And again, don't be hard on yourself. You did the right thing. Thanks for the question. We'll be right back after a quick break. Support for the show comes from Framer. Picture this. You launch a website and your whole team's celebrating. Then the support tickets start to roll in and put a damper on the mood. That's when you could use a website platform that lets teams build, ship, and improve their sites faster than ever while getting every detail right. For that, you could use Framer. It's a complete website platform, not just a builder, so teams can launch and keep improving their sites in one place. Framer lets you prompt, inspect, edit, and publish in one place at a whole new pace. On Framer, AI agents and humans work in tandem. Agents bring speed and scale while people bring taste, judgment, and control. And that all takes place in the same workspace where the real site is designed, managed, reviewed, and published. Framer is an enterprise level solution that the world's leading brands, including Perplexity and Miro, rely on to build their websites. Learn how you can get more out of your site from a Framer specialist or get started building for free today at framer.com/propg for 30% off of Framer Pro annual plan. That's framer.com/propg. Rules and restrictions may apply. Support for the show comes from Vanta.
00:13:51 · Scott Galloway, S1
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00:15:33 · Scott Galloway
[00:15:33] S0: Welcome back. Our next question comes from a listener on Reddit. AliveShallet6780 says, greetings professor G. I'm a 35 year old man and my wife and I left New York to move to Portland, Maine to start a family. We've been trying to start a family for three years now, and I can say that infertility has been the hardest experience of my life. While we're blessed with financial security thanks to good luck and hard work, two rounds of IVF have been unsuccessful and we're considering pursuing surrogacy. The most challenging part of this experience has been the social aspect as it is quite frankly painful and dull to hang out with parents and their young children. As someone who became a father in his forties, what kind of advice could you offer someone who's likely to become a parent later in life? Thanks for everything you do. I'm choosing my words carefully because I think this is so important. And I don't know if my experience is the same experience as anyone else's. So according to the CDC, about one in five married women ages 15 to 49 with no prior birth are unable to get pregnant after a year of trying. It's so weird, we spent so long trying not to get pregnant. And then what's strange is as we get into our 30s or 40s, then we have trouble getting pregnant. So this is something that as people are having kids later and later, this is something that is very common across households. And people are becoming parents later. The average age of first time fathers rose from 27 in 1972 to 31 in 2016. I just read a crazy stat that there's more women having babies over the age of 40 now than under the age of 21. Teen pregnancy is way down, which is a good thing. Lower birth rates are they're a bad thing for the economy. If you want to look at a country that goes into recession, just look at the ratio of young people to old people. We do better actually than most nations, because people are still having kids here, and immigration is a means or a pressure valve if things get really serious you let in more immigrants, although our current administration doesn't seem to get the memo on that. But demographically The US is quite frankly is less screwed than many nations in Europe, Japan, and China. Anyways, what is the advice for having kids later than life? I got lucky. I think it was really good for me. I had kids at 42 and 45.
00:17:52 · Scott Galloway
I didn't want to have children. I like being selfish. I'm a naturally selfish person. I didn't like enjoy other people's children, so I wasn't against it, but I just wasn't for it. I liked my life. And I met someone who I fell very much in love with, who wanted kids, and I said I don't want kids. She said I'm not going to be with someone, or I can't be with someone long term that doesn't want kids. I said, wait, I've reconsidered. I want kids. And we got pregnant almost right away. I said to her, I don't want to get married. She said, I don't need to get married. It kind of called my bluff. And in the next three years we had two kids. Look, I feel like there's never a good time to have kids. Whether you're in your twenties or too young, in your thirties you're working your ass off, in your forties you start to feel like you're too old. I liked having kids a bit older for the following reasons. One, I just think I'm a better dad. I'm older. I realize that life isn't about getting a return on your relationships. It's about being on the right side of the ledger. And then if you exit this world having given more than you've gotten from your relationships, which sounds weird, but, you know, a pretty good obituary might be the vast majority of people in his life felt there was no way they could be as good a friend, as good a spouse, as good a son as this guy was, you know that wouldn't be a bad obituary, right? So you just get more perspective. I think you get more generous. I think you get more patient. And also, just to be blunt, having kids later in life meant I could spend more time with them, and I wasn't as freaked out, because I had more economic security. Now when my kids were born, was my first kid was born in 'seven, and just as the market was crashing came kind of marching out of his mom. And the first thing I felt was economic security. Had I felt that economic security when I was younger and I didn't have kind of currents in the marketplace, I just think it would have been incredibly stressful raising kids in a home not of economic stress, but where I'm basically working all the time trying to build economic security and didn't have a lot of money. I was pouring all my money back into the business. So more perspective, more maturity, more generosity, and some economic security.