Deep Dive
Shownotes Transcript
Rule Breaker Investing has been built on episodic series. It's not true every week, but many a week we're adding the next episode toward a mailbag, or an author in August, a great quote, or a mental tip, trick, or life hack, all of which are episodic series with many past entries. Each episode is brand new, mind you, no repeats, but these are big, broad themes that we can return to time and again. And here's another one, pet peeves. I've done
Eight episodes of those where I've shared with you, I counted them, 66 original pet peeves coming across, I guess, as a peevish old fool. Well, four years ago, fellow fool Ben Adams at BenAdams50 on TwitterX dropped me a line. He said, I think I've just had a great idea for the next Rule Breakers podcast. Ben said, you've done pet peeves.
Maybe it's time for Pet Perks, the little things that make everything seem better. Ben went on, optimism is contagious after all, and it is. And Pet Perks Volume 1 was born last June. But that was just the start. The little things that make everything better in investing, business, and life. Pet Perks Volume 2 starts.
Only on this week's Rule Breaker Investing. It's the Rule Breaker Investing Podcast with Motley Fool co-founder David Gardner.
And welcome back to Rule Breaker Investing. Let me mention right up front, next week, next week is your mailbag. I'm happy to say I already have one amazing note, but I'm always looking for a bunch of amazing, great notes. So let me just remind you that our email address is rbi at fool.com. And if you're interested in
Did you listen to last week's podcast and our stock stories around the frozen campfire? Apple, Axon Enterprise, Copart, Crocs, Zoetis. The week before, old, new, borrowed, blue. We talked about social capital and building bridges, not walls. We also talked about game designer Reiner Knizia. All
always playing blue and what we can learn from that. And then of course, late last month, three fools with Morgan Housel and Randy Zuckerberg. So this week we're talking about pet perks for me.
This is not part of the list, but I'm just going to mention for me, one pet perk is getting your notes, your reactions to this podcast. Drop us a line. RBI at fool.com is our email address. You've heard the stories, the perks this week. You'll hear the insights. Now it's your turn. What stands out to you this week or last? Do you have maybe a stock story of your own? Whatever it is, I'd love to hear from you. Drop me a note. RBI at fool.com. Your thoughts might just make it into next week's mailbag.
Oh, and at RBI podcast on Twitter X. All right. Before we get started, it's page breaker preview time. As I shared at the start of the year, my 2025 book, Rule Breaker Investing, is available for pre-order now. After 30 years of stock picking, this is my magnum opus. It's a lifetime of lessons distilled into one definitive guide.
Each week until the book launches this summer, I'm sharing a random excerpt. We break open the book to a random page, and I read a few sentences. So let's do it. Here's this week's Page Breaker preview. Three sentences from part one of the book, and I quote, Just like baseball hitters aiming for 400 hit over 300...
Rule Breaker investors should aim 100 basis points higher than conventional wisdom. Conventional wisdom suggests beating the market averages would just be a coin flip, 50-50, or in baseball terms, 500. Whether or not this is true, aiming high is crucial.
End quote. That's this week's Page Breaker preview to pre-order my final word on stock picking shaped by three decades of success. Just type Rule Breaker Investing into Amazon.com, BarnesandNoble.com, or wherever you shop for fine books. Oh, and thank you. Thank you to everyone who's pre-ordered. That means a lot to me.
All right, Pet Perks, Volume 2. Three from the world of investing, two from business, and three from life. Without further ado, let's get started. Pet Perk number one from the world of investing, I'm going to call it seeing through a dark cloud because you got to know a company better and better over time, and you were able to ignore the doom and gloom headlines. You pressed through, and you won.
Detecting competitive advantage where others see vulnerability or weakness, that's what sets up the most lucrative investing opportunities. And for years, longtime listeners will know I call these situations dark clouds I can see through because dark clouds symbolize a strongly negative prevailing view of a stock. Picture
A storm cloud bursting with lightning and rain directly over Charlie Brown's head. Everyone's seeing it. It's big and dark, evident to everyone. This is symbolizing broadly pessimistic sentiment. Investing in this company, it seems like wouldn't work out. Everyone can see that.
But when you can see through those dark clouds, that means you've got unique insight. And typically that comes by observing something over time. And a real pet perk of investing is developing the knowledge of the company you're invested in that you're part owner of. It's becoming increasingly familiar with its industry and the world at large so that when people start saying things like,
Walmart's going to crush Netflix. This is back in the day of the male DVDs. Walmart now allows you to drop off your rented DVDs from Walmart back at Walmart, and that will clearly crush Netflix. The key is, if you thought Netflix could actually withstand Walmart, or in an earlier era, if you thought Netflix could withstand
blockbuster video which was much much bigger older hands will remember if you thought netflix could withstand hbo and all of its amazing content as netflix itself entered the field with its own original content you were in the minority in every one of those cases
And we have to show humility when we're in that place in the face of so much confidence on the other side, because we may very well be wrong. I certainly could have been wrong about Tesla when I first picked it in November 2011. After all,
electric cars had largely failed over and over up to that point. So you have to go in always thinking, I could be wrong here. But there is a true pet perk, a little feeling that makes everything better when you get through those periods where people were selling off all the dot bombs and saying it's all over the internet or the great financial recession. We should all just sell. The system is broken. Or even how about that COVID huge drop that
30% drop in one month we saw in the spring of 2020, and the shellacking that many of our favorite COVID stocks took in 2022. When you show resilience, when you develop pattern recognition, and you begin to recognize these as dark clouds that you can see through, if you're right when the world bets against you,
These are actually the situations that make you and me as Rule Breaker investors the most money. So seeing through a dark cloud, because you got to know a company better and better, and you saw something the majority of the world did not. That is a true pet perk that only comes with experience in investing, especially experience by holding companies for long periods of time and getting to know them better and better. Let's move to pet perk number
Number two, this one's a little bit quicker hitting. I was reminded that I got it from Jordan Ellenberg, the mathematician and the academic at the University of Wisconsin, who joined me for Authors in August in 2023. His book, How Not to Be Wrong, The Power of Mathematical Thinking, is where pet perk number two comes from. I'm going to quote him in a sec, but here it is essentially.
As you get richer as a person, as you get richer as an investor, you're able to take more risk. And that is indeed a pet perk. Ellenberg writes in his book, and I quote, this is a mathematical way of formalizing a principle you already know. The richer you are, the more risks you can afford to take.
Bets like the one he mentions in the paragraph above in the book, bets like that one are like risky stock investments with a positive expected dollar payoff. If you make a lot of these investments, you might sometimes lose a bunch of cash at once, but in the long run, you'll come out ahead. The rich person who has enough reserves to absorb those occasional losses invests and gets richer, end quote.
It's a fairly commonplace observation. It's not even that mathematical when you think about it, but the more resources that you have, the more you're able to spread your bets and sometimes take bigger risks than you would before. I don't ever suggest you load up and put a lot in any given risk. The point is you can afford to lose the richer you get in life. That means, again, you can participate financially.
in more new forms of investment, maybe you start doing some venture capital on the side or some angel investing, those things often don't work out. You can afford for them not to work out. Maybe you gave a younger person or a young team a hand up or a step up with that additional investment you made that didn't work out. The richer we get over the course of our lives, and if you're doing it right,
That should happen fairly continuously with each passing year as we age on this earth. Yes, the stock market goes down one year in three, but if compounding returns are alive in your life,
And that's what we at The Motley Fool have asked you to do, have preached 30 plus years now, and especially for Rule Breaker investors, finding great companies like some of the ones I've already mentioned in this week's podcast, letting them compound. You should be making more money in all time highs with the passage of years. And therefore, your ability to take risk and lose is strengthened.
And that is definitely a pet perk. Thank you to Jordan Ellenberg. And let's move on to my last investing pet perk, pet perk number three. This, a user submission at 307Fool. I dropped a note on TwitterX this week and said, hey, who's got one for me? Because this podcast loves its community. I'm so grateful for so many of you who've been part of the Rule Breaker investing community, the Motley Fool community for years or decades. And one of them is Matt Hard at 307Fool.
Matt suggested pet investing perk. I feel strongly as well. That's why, Matt, I wanted to make it number three here. Matt wrote, shout out to at Tom Gardner Fool and his hashtag Fool24 initiative.
The full community, Matt writes, has always been awesome, but I feel like this is taking membership value to a whole different level. Access to experts, timely discussions, and a breath of fresh air compared to the news cycle of 2025. Now, members listening to me right now,
especially longer time members, know exactly what I'm talking about. I'm talking about our effort at The Motley Fool every day from 9 a.m. to 6 p.m. That includes weekends and it includes holidays every single day. If you're a Motley Fool member, you can join us and have your questions answered by our analysts and advisors, people that you regularly have heard on this podcast, people whose stock picks or strategy you may well be following possibly for years.
as a Motley Fool member. And now, through the magic of things like Zoom, online platforms that support video, make it accessible, enable you as an audience member to ask interactive questions during the videos, all of that is now free.
free for Motley Fool members. So, Matt, you've set me up to give an unintended advertisement for something that I think is just a fantastic resource. I admit, I don't really watch much financial TV. I don't spend any time really watching financial cable TV.
I'm a little biased here, but I do spend time watching our Motley Fool analysts on our TV channel on our website, Fool24. If you're a member, just look right at the top of the online interface. You'll see Motley Fool analysts are answering member investing questions every day from 9 to 6. Click here to join the fun. So happy, Matt, that you took the time to write in. And I'll just mention this Friday, that would be February 21st,
at 10 a.m. I'll be on Fool 24 for one solid hour. I'm really looking forward to interacting with my fellow Fools. Matt, I hope you can make it too. But if you are a Motley Fool fan and you'd like to spend some time talking about Rule Breaker Investing, my longtime sidekick, Tim Byers, who helps head up Rule Breakers these days at The Motley Fool, Tim and I will be answering your questions on, well, Rule Breaker Investing or anything goes, 10 a.m. this Friday morning.
All right. Those were my three investing pet perks. Let's move on to the world of business. Many of us, when I say business, I'm just thinking of working professionals. You might be working in government. You might be working in business. You might well be self-employed these days, working remotely or working in an office. I'm always thinking about how to make our lives at work better. What are some of the pet perks we can celebrate? Let's go to pet perk number four this week. The first one in business, I'm going to call it
The joy in making a difference. One of my favorite books about work, professional life, is called The Why of Work by Dave and Wendy Ulrich. I totally recommend The Why of Work to anybody who, especially if you are a business owner or looking to create great culture that inspires your employees, your customers, and all of your stakeholders and creates wins for you as well, wins for all of your stakeholders in your business. I'm a huge fan
of the why of work. And I want to quote something directly from that book right now to get across pet perk number four. And I quote, customers who are delighted with their interaction with your products come back for more.
So to your employees, in an understated backdoor way, delight seems to go to the heart of finding a sense of abundance at work. Delight teaches us that life's goodness is not found in money or fame, but in simple pleasures, meaningful connections, and a sense of discovery. Delight reminds us that no one has nothing to give.
that relishing diversity and multiculturalism is good business, and that there's always something of which we have enough.
and to spare. Employees who find delight at work are often employees who stick around, who make a difference, and who invest their discretionary energy in the creative and challenging aspects of work. End quote. That paragraph from the book, The Why of Work. And it reminds us the power of feeling as an employee, if you are one, I am too,
feeling aligned with the purpose of your organization. When you are aligned with the purpose of your organization and able to bring your best fruits, your best abilities, your best self to the work that you do every day toward a purpose that you're aligned with, that is like professional nirvana. So it's that joy in making a difference. It's a pet perk.
You're not being paid for joy. The joy emerges spontaneously because you have aligned your own efforts and what you're best at with something that really means something in this world. There's another author I want to call out here, Cindy Wigglesworth. Cindy wrote a book called SQ21, The 21 Skills of Spiritual Intelligence.
I think we've all heard about IQ intelligence before. We've also heard about EQ. That would be emotional intelligence. I've also had Shirzad Shamin on this podcast a few times, one of my favorite books, Positive Intelligence. He talks about your PQ, your positive quotient. Well, in that same vein, Cindy Wigglesworth wrote a book about the spiritual quotient, the SQ, that
that exists in workplaces. If you are a person of faith, and I don't, in this case, care what type of faith, are you able in some way to share that, not in an evangelistic or over-the-top kind of way, but is it acknowledged? Is there space for that in your workplace? And Cindy says that the businesses that allow people to share some of their feelings, for example, maybe there's an employee resource group that
supports employees of a certain belief or bent or a bunch of them, that opportunity to be connected with the spirituality that you feel and not have to hide it or fully divorce it from the workplace, but allow it to be there. Again, not in any overweening way. That is what Cindy calls a joy experience.
paycheck. You get your paycheck, but then there's also a joy paycheck. And since I'm quoting authors a little bit this week, I'll quote Cindy directly from her book where she mentions this. And I quote, as Marcus Aurelius, the second century Roman emperor philosopher declared, quote, everything, a horse, a vine is created for some duty. For what task then
were you yourself created? A man's true delight is to do the things he was made for. End quote. Cindy goes on, that true delight is what I call my joy paycheck. And it is as important, if not more so, than the cash paycheck I get each month. That is from Cindy Wigglesworth's book,
The title is SQ21, the 21 skills of spiritual intelligence. But you bring those things together, the why of work and SQ21, and I think you can see that a big pet perk, I hope you have it in your own professional life, is the joy in making a difference and a difference that you really love.
And on to pet perk number five in the workplace. The first one was for all of us, wherever we're doing work, for-profit, not-for-profit, for-pay, volunteer. The second one is more for entrepreneurs. The book, The Whole Story, Adventures in Love, Life, and Capitalism, was written by Whole Foods Market founder John Mackey. I had him on the podcast last year to discuss it.
In the book, I'm not sure we went over this in the interview with John. It's been a while, so I can't quite remember, but I definitely want to highlight pet perk number five in business for entrepreneurs, and that's the fun.
The fun of entrepreneurship, the fun of discovering its goodness. John puts it so well in his book. Let me quote it. This is his own experience, his take on it. Maybe you can relate to, especially if you've ever started something. John wrote, and I quote, it was energizing to imagine the store we could create. But more than that, it was fun.
Who knew business could be so much fun? I'd always loved science fiction and fantasy literature, entering imaginary worlds and living vicariously through the characters inside them. But this was even better. It was a new world, but it wasn't just fantasy. We could and would build this store, this beautiful edifice of food, health, teamwork, and business out of nothing more than dreams, hard work,
and some investors' capital. I felt, John went on, momentarily like some ancient alchemist dabbling in the act of creation. What a joy it was in that moment to be an entrepreneur. I was beginning to love this thing called business. End quote. I think in a lot of ways, what John is rocking there is really just the fun of creativity.
of making something. Artists can easily relate. We can all relate. We're all creatives in our own different ways. We're all creative individuals. And when we're really able to make something new, something there that wasn't there before, as one of my favorite businessmen, Roy Spence, has said, the great joy in life, putting something there that wasn't there before. When you're able to do that, that's just fun on its own. But here, especially for entrepreneurs,
Having fun and realizing creativity exists just as much in business as it does in any other area of life. And as I start to close out pet perk number five in my two business pet perks this week, I'm emboldened to just go a few more sentences into that next paragraph because John puts it so well, I think. He goes on to say, why don't more people know what fun this is? I wondered.
John wrote, my accountant father had always given me the impression that business was about money, finance, math. My university professors had given me the impression that business was about greed and profiteering. It had always seemed so serious, so hard, so brutal.
unemotional, but this was quite the opposite. This wasn't work. It was more like playing a game, and I loved to play, John Mackey wrote. Give me clear rules, fair and intense competition, and problems to solve, and I thrive. Could this really be what business was all about? Well, I couldn't speak for anyone else, but here I was, an actual businessman, and I'd never had so much fun
in my life. And indeed, as I wrote in Rule Breaker Investing, I say past tense because I wrote it last year, but it doesn't come out until this summer. But I remember writing, oh, and rule breakers have more fun. And that concept of fun, I think, is so important to harbor, to aim for, to seek out and make happen in your life
every year of your life and if possible, every day of every year. And I really do think as fellow Rule Breakers, Rule Breaker investors, some of us entrepreneurs, Rule Breakers along the path of life, I really do think, maybe blondes too, but I really do think Rule Breakers have more fun. All right. Well, I've got three queued up to close out.
life pet perks. But before I go there, let me mention a couple more write-ins, community suggestions from Twitter X. I want to thank Mark for this one at MXJ61. Mark wrote, I have a daily affirmation I say aloud. Today, I, Mark, will enjoy myself. He goes on, I ward off a dull market. I think that's what you meant, Mark, by
going to do something enjoyable. If I have an argument that lowers my enjoyment that day, I stop, remove myself, and go do something enjoyable every day. Mark writes, it works. And one more, this one from the investing monk on Twitter, at monk Ekevaria.
He writes what I call the 10-10-10 filter. This is a pet perk of life for him. Ask yourself, will this choice, this event, will these things matter in 10 days or 10 months or 10 years? He goes on, it cuts through decision fatigue, the 10-10-10 filter. Oh, and noise.
as well. So thank you both for a couple of pet perks that you've experienced. And we're sharing out through this podcast this week through our life section. Now let me finish out with three pet perks from life. And the first one I experienced just this past week. It doesn't happen to me every week. In fact, I count whenever it happens. I did it eight times last year and I did it once so far this year. It was last week. It's inbox zero.
It's when you get to a point that you have no emails. You're waiting on zero emails to respond to. Something that I've learned from people like David Allen of Getting Things Done fame over the years. A number of other authors talk a lot about the idea of not allowing email to rule your life, but to be in charge of email yourself.
I've really made an effort to clear the decks on a periodic basis, and it's so satisfying when you really do get to a point. I hope you've gotten there. You may well, dear listener, get there more frequently than I do.
It's so meaningful for me. I actually timestamp it in my calendar so I remember the exact minute of the exact day a few times a year when I get there. Again, it happened for me just last week. That's why it's on my mind. But pet perk number six, a pet perk from life when you hit that moment of inbox zero and everything is possible, everything until that next email shows up. All right, let's move on to pet perk number seven. I first experienced this with
Pandora, the music platform, but certainly Spotify and others do this pretty well today too. But sometimes these pet perks are just about pinching ourselves or reminding ourselves of what we may take for granted. And that's pet perk number seven, personalized radio. A lot of us older hands, again, grew up where you had to tune off in your car or maybe your
Boombox to a certain radio station. You didn't know what was going to play next. You had no real control. You tried to find stations that you enjoyed. There usually were a lot of ads, a lot more than I hear these days on Pandora or Spotify. There are still ads out there. But to personalize your radio by starting with a single seed, a song or an artist, and then
evolving that station by letting it know, thumb up that one, thumb down this one, not knowing what's coming next, a randomized assortment of new music that gets fired at you by your music platform. You get to say yes or no, and you evolve it over time. There are many pet perks, I think, to this for me, but two that come quickly to mind. The first is
As an incredibly geeky board gamer, I think I may have mentioned this on the past in this podcast, but I've taken the time to create individual personalized Pandora channels for each of my favorite board games. These days, you can ask AI, hey, throw me five tracks that would work for ancient Rome.
And you can just type those in to Spotify, Pandora, whatever, and start with that seed and then just build out the station that you play for your friends when they come over to play a game like Tribune or something else from ancient Rome. And it works for every board game on my shelf. Not every board game on my shelf is worth the time of building a distinctive personalized channel, but a few dozen are.
and counting. So the ability to just start new stations, just catalog them over time, is pretty awesome. Definitely a pet perk of personalized radio. And then one other, and that's just the feeling of having forgotten about a song. Maybe you grew up in the 70s, you bought your first 45s back then, you started with a Victrola. These days, vinyl is cool again. People are repurchasing Victrolas for reasons I still can't quite figure out. But regardless,
It was the 70s, and you loved some of the songs back then, but you don't remember half of them. But then your personalized radio, as you start a 70s channel, starts bringing back music you'd completely forgotten about, a song that you'd forgotten about, until it plays on your randomly evolving personalized stations. What a lovely experience.
pet perk. Again, the little things that make everything better. So pet perk number seven, stated broadly, personalized radio. All right, and let's close it out with maybe more of a whimper than a bang. I don't think I saved the best for last. I think I just, in fact, I timestamped this. It was June 20th of last year. It was 1.53 p.m. that I noted, because I was sitting in my car at the time, that I noted the pet perk benefits of just a good
car wash. You know, the automated car washes, the ones where you sit down in the seat, maybe you have your kids in the back and you're on a rail. It's like you're fastened to this thing that's slowly moving you through. And there are gigantic brushes and you're getting sloshed silly with soapy water. You're getting hit from the underside, the backside, the side side and the front side. It only takes about three or four minutes. If you're in there by yourself,
That's a little moment of Zen, a little bit of time for you just to enjoy the quiet. Actually, it's not that quiet of the world, the slowing down, the car wash. When I think of the pet perks in life, how many times have I rolled through an automated car wash? The answer is actually not that many in recent years. I kind of forgot about it, but I was at the beach last summer and I went back through one. I thought, you know, this is a small pleasure and something that you can share with others.
or enjoy on your own. And as we exit this week's podcast, and I'm talking about cars, I would be remiss if I didn't mention one additional pet perk, a bonus one, and that would be the perfect parking spot. You know that feeling? Again, it doesn't happen every time. That's part of what makes it special, but that perfect spot.
parking spot that you weren't expecting. And the one tip I have in closing on that is, you know, if you don't go up and try to get the best parking spot, if you're unwilling to drive right in front of the restaurant or the venue, if you don't actually go right up there, you'll never find out whether you could have had the perfect parking spot. So for me anyway, I always go hoping slash expecting that I might actually get the perfect parking spot because if you don't look,
you'll never get one. Anyway, pet perks around our automobiles. These days, for me, a car that drives itself is well more than a pet perk, but that's certainly increasingly true of the car that I drive every day. It's doing a pretty doggone good job of driving itself for 40 minutes through lots of different forms of traffic safely with my
Well, attentiveness, because you have to remain attentive, but a little bit lower key approach where you can look around a little bit more and not feel like you have to make every call at every stop sign, stoplight, and on-ramp into traffic. So that itself is well more than a pet perk. But just back to the little things that make everything better, car washes, and yeah, sometimes that perfect parking spot.
All right. Next week is your mailbag. Again, our email address, rbi at fool.com. What pet perk did I miss this week, Ron? We would love to hear from you. Let's summarize briefly as we go. Here were the eight pet perks highlighted. Thanks again to at Ben Adams 50. Ben, thanks for your wonderful suggestion. I have a lot of fun with this episodic series. Number one was seeing through a dark cloud because you got to know a company better and better. Number two was that as we get richer, we're able to take
more risk. Number three, Fool 24. That's right. Motley Fool analysts are answering your questions if you're a member every single day of the year from 9 a.m. to 6 p.m. these days. Pet perk number four, in our professional lives, the joy in making a difference, that joy paycheck. And number five for entrepreneurs, the fun.
Number six, I wish this happened more frequently, inbox zero. Number seven, personalized radio. And number eight, yeah, the car wash. And with that, my fellow fools, I'll pull into my perfectly aligned parking spot, admire my spotless car, and remind you, whether in investing, business, or life, keep your engine running and enjoy the ride. Fool on.
As always, people on this program may have interest in the stocks they talk about, and The Motley Fool may have formal recommendations for or against. So don't buy or sell stocks based solely on what you hear. Learn more about Rule Breaker Investing at rbi.fool.com.