Episode #318: Perth Tolle, Life + Liberty Indexes, “If I Was In Hong Kong Right Now, I Would Be Arrested, Definitely, For Doing This”
Guest: Perth Tolle is the founder of Life + Liberty Indexes. Prior to forming Life + Liberty Indexes, Perth was a private wealth advisor at Fidelity Investments in Los Angeles and Houston.
Date Recorded: 5/5/2021 | Run-Time: 57:37
Summary: In today’s episode, we’re talking about freedom! Perth shares what led her to focus on the relationship between freedom and investing in emerging markets. We hear the story of how she launched the ETF with the help of former podcast guests Rob Arnott and Wes Gray. She shares the inner workings of her Freedom Index and how it uses personal and economic freedom metrics as factors.
As we wind down, Perth explains how it differs from most emerging market funds and what the reaction has been from people all around the globe.
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Links from the Episode:
- 0:43 – Intro
- 1:28 – Welcome to our guest, Perth Tolle
- 2:50 – The inspiration behind launching a freedom ETF ($FRDM)
- 5:48 – Taking the idea for the fund and turning it into a reality
- 7:24 – Episode #313: Rob Arnott, Research Affiliates “Modern Monetary Theory Does Not Work”
- 7:37 – Connecting with other like minded investors about socioeconomic impacts
- 9:02 – Intercepting Rob Arnott and building a relationship with Research Affiliates
- 14:30 – The onramp for taking this fund to market
16:00 – Overview of the FRDM Index ETF portfolio construction
- 21:37 – Why they choose to exclude China from their emerging market weighting
- 24:33 – Sponsor: Bitwise
- 25:23 – Why Perth has such a focus on emerging markets
- 26:58 – Factors involved in rebalancing and the frequency of fund adjustments
- 30:01 – Key factors that may contribute consistently to changing the rank of a country
- 33:19 – Common criticisms of their fund and methodology
- 38:41 – Government intervention in markets and how they change public opinion
- 42:02 – Tailwinds in Poland and their position given the country’s freedom
- 43:33 – Research papers on freedom in financial markets
- 45:00 – What type of investors are taking interest in the $FRDM ETF
- 47:20 – What the future looks like as Perth looks out to the horizon
- 50:40 – Socialism Sucks: Two Economists Drink Their Way Through the Unfree World – Robert Lawson and Benjamin Powell
- 52:00 – Which frontier market is currently the most free
- 55:00 – Perth’s most memorable investment
- 56:31 – Learn more about Perth; lifeandlibertyindexes.com; freedometfs.com; Twitter @perth_tolle; LinkedIn
Transcript of Episode 318:
Sponsor Message: Today’s episode is sponsored by Bitwise.
Welcome Message: You’ll hear more about them later in the episode. Welcome to “The Meb Faber Show” where the focus is on helping you grow and preserve your wealth. Join us as we discuss the craft of investing and uncover new and profitable ideas, all to help you grow wealthier and wiser. Better investing starts here.
Disclaimer: Meb Faber is the co-founder and chief investment officer at Cambria Investment Management. Due to industry regulations, he will not discuss any of Cambria’s funds on this podcast. All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion of Cambria Investment Management or its affiliates. For more information, visit cambriainvestments.com.
Meb: Hey, everybody. We have an awesome show today. Our guest is the founder of Life + Liberty Indexes, exploring the relationship between freedom and markets. In today’s show, we’re talking all about freedom. Our guest shares what led her to focus on the relationship between freedom and investing in emerging markets. We hear the story, how she launched the ETF with the help of former podcast guests, Rob Arnott and Wes Gray. She shares the inner workings of her freedom index and how it uses personal and economic freedom metrics as factors. As we wind down, our guest explains how it’s different for most emerging market funds, what the reaction has been from people all around the globe. Please enjoy this episode with Life + Liberty Indexes, Perth Tolle. Perth, welcome to the show.
Perth: Thanks so much for having me.
Meb: I have my margarita here. It’s Cinco de Mayo. It’s not a margarita. It’s tea, sadly. I’ve been trying to get Perth on the show for forever and finally have you. Where in the world do we find you today? H town?
Perth: I am in Houston. Yes. Wish I was in LA where you are, but…
Meb: Well, the world is reopening. Everyone’s on the beach today playing volleyball except for surfing. Perth, I got to give you a little bit of insight. There’s a song I think about every time I talk to you. Do you have any guess as what it might be? And I’ll give you a hint.
Perth: Something freedom related?
Meb: This was my first concert I ever went to with my parents, of course, and very, very reluctant brother who was seven years older and a big sort of Van Halen music genre fan.
Meb: Denver Fiddler’s Green. This would have been in the ’80s. Any guesses?
Perth: I don’t know…
Meb: Song name is “Freedom.”
Perth: I knew it.
Meb: Anyway, listeners, as embarrassing as this is George Michael, “Faith Tour,” is sort of an ’80s.
I won’t let you down, freedom
So please don’t give me up, freedom
Cause I would…
Meb: Well, let’s move on to something people might be interested in. Perth, let’s talk about freedom. You have a very unique index in ETF, I remember when it wasn’t even an ETF yet. When was this launch by the way, ticker symbol FRDM? When did you push the ship out to ocean?
Perth: Just about two years ago, May of 2019, May 23rd. Since you just said the ticker now show it.
Meb: Yeah. Congrats you’ve survived the first year or two.
Perth: Thank you.
Meb: But let’s rewind for those who don’t know you. What was the inspiration? You’ve taken a little bit different path like we all do, but tell me the inspiration behind launching an ETF is?
Perth: Thank you. So, yeah. No. The inspiration originally came from my background. I grew up in both China and the U.S. And when you’re talking about these songs, Minnelli and MC Hammer, that’s about the time when those songs launched in the United States is about when I came to the U.S. So, that’s why I remember that from my first year here in the U.S. And that’s why I’m not as familiar with the ’80s songs as well because I was in China during the ’90s, actually, during most of the ’80s. So, yeah. I grew up both in China and the U.S. And after college, I went back and lived in Hong Kong for a while and I travelled throughout the mainland while I was in Hong Kong, so I went to Shanghai and Beijing. And I realized the difference that freedom actually made in my life and also in the markets in these countries.
And I had a friend in Shanghai. I called her Maggie. But she didn’t really have any birth certificate or school records or social security. She just didn’t exist on paper. And that’s when I realize…because she was not an only child. It was a one-child policy due to the one-child policy, so her parents registered her brother for school and for existence, basically. And she was exact same age as me and we were exactly the same in every other way. And I realized, “Wow, that could have been me.” So, I realized, okay, so, freedom matters. These policies matter. This particular policy changed the whole culture of my generation in China. And now they’re allowed to have two children and nobody’s really having two children. Financial Times just came out with a story last week that China’s birth rate is declining. And that’s very bad. You know about demographics and how important they are especially in growing economies. And China has the worst demographics situation in the world right now. And a lot of that is due to this one-child policy, and that’s pretty much irreversible at this point.
So, that was kind of where the seed was planted. And then when I came back to the States, I worked at Fidelity for about 10 years as a financial advisor. And I had clients who were from… I was in the LA market and the Houston market. And so I had a lot of clients from China, Russia, Saudi Arabia. And they told me that… I had a Russian client who said, “I don’t want to invest in Russia because it’s like funding terrorism.” Those are his words, right? So, a lot of clients felt the same way as I did. We wanted to participate in the growth in emerging markets. I think you’re one of the few people who really appreciate the emerging markets and the potential there. But we didn’t want to be funding some of these less free regimes. And so that’s where the idea for FRDM came from.
Meb: All right. So, you had this little acorn of an idea and, like, I talked to most of our friends, particularly those in the emerging asset management business, not just ETFs, but people that wants their own funds. It’s a pretty audacious belief. For some of us, I like to say you have to be an optimist and also a little naive to think we can take on Vanguard and Fido and all these ginormous trillion-dollar companies. How did you go from someone who just had this little acorn of an idea to actually making it happen?
Perth: As an entrepreneur in this space, you know that we don’t have much time to reflect. But when I think back on it, it is kind of crazy. And I can’t take the credit. This is something that’s always been bigger than me, and that’s been obvious from the beginning. There’s no way I could have done this on my own. I was at Fidelity and I knew that it was time. I was also… I had a young child at the same time that I left Fidelity and I wanted to stay home with her. So, I did leave Fidelity to be a stay-at-home mom for a while. But when she got ready to go to school, I started doing this full time. And when I did that, I called Research Affiliates because they were doing non-cap-weighted indexing and I wanted to do freedom-weighted, which is non-cap-weighted indexing. So, I said, “Hey, do you guys want to work together on this?” And I was such a fan of Research Affiliates that I used to stock their building because they used to be on the same street as us. So, Fidelity in Pasadena, which is one of the branches where I worked was on South Lake Avenue, and Research Affiliates before they moved to Newport was on South Lake Avenue. So, I used to be, like, walking to the building and be like, “Wow, that’s Research Affiliates.”
Meb: Yeah. Well, that was because of the old first quadrate tie up and then down to PIMCO. And then I think we’ve had more Research Affiliates alumni, we actually just had Rob on the show about a week ago, than probably more than any other company. So, what did you do? Did you just pick up the phone and, like, look up the 1-800 number and be like, “All right. I’m going to call Research Affiliates?”
Perth: Yep. Pretty much. So, I called Research Affiliates and… Well, I’ll looked them up on the internet. I called the number and I said, “Hey, do you guys want to partner on this?” And they were like, “Please go away.” They were not interested at all. I couldn’t get through, like, the first gatekeeper. So, I just tried to learn as much as I could about ETFs. I knew that I wanted this to be an ETF because I don’t know any other vehicle that’s so beneficial for investors, especially in emerging markets because we go out, as you know, and get accounts open at all of these countries so that people can have access to local shares on the local exchanges through the ETF. And there’s no way that most investors can do that on their own. But it costs money for us to do.
Meb: And if they could, they shouldn’t, for the most part.
Meb: Believe me, it is a giant pain. All right. Keep going.
Perth: Yeah. So, I just tried to learn as much as I could about the ecosystem. And I went to inside ETFs first year. And that year, there was an intra-conference app where you could tweet out to other conference participants. And this one guy kind of tweeted out, “Hey, I’m in this China talk and I can’t believe that this guy hasn’t once mentioned the one-child policy and its implications on the economy.” And I was like, “Hey, somebody else here knows and cares about the one-child policy.” He turned out to be a portfolio manager in Tennessee who was the head of a couple of CFA societies down there. So, he asked me to go speak at these tiny CFA societies in Tennessee.
Meb: And wait, and had you come up with the index at this point or were you just thinking about it?
Perth: I was just thinking about it. Actually, there was an index I was being calculated at this point, the first iteration, but there was no ETF at all and there was no plan for an ETF. There was nothing concrete at that time. So, I went and spoke at these conferences. I spoke about China and the demographic situation. And it was like 20 people per room. And then they recommended me for a CFA society in Tampa, which then I was on a panel with David Kotak, BlackRock, and Morningstar. This is their forecast panel, so a lot more people at this one. After the panel, David Kotak invites me to Camp Kotak, which is a place where basically 50 economist and financial people go to fish for 3 days in the woods with no Wi-Fi. And I was like, “Who does this?” Right? I was, like, totally new to the space. And my friends were like, “You should go. Barry Ritholtz goes. You can meet Barry Ritholtz.” So, I went. This was 2016.
Meb: You just can’t get on the boat with Barry because then he’ll talk the entire time and scare away all the fish. That will be like that you won’t catch anything.
Perth: We should just do a podcast on the boat.
Perth: But yeah, Barry was the incentive for me to go. And so I went and I was going to take… You have to take a seaplane to get into the campsite or you can drive. If you drive, it’s like two and a half hours. Seaplane is like 20 minutes.
Meb: This is in Maine or New York?
Perth: It’s in Maine. I was coming in from New York because I had meetings at the time in Boston and New York and then I went to Maine. So, I was tired for my meetings. I had planned to drive, but I was like, “I’m not driving two and a half hours.” So, I called a seaplane company. I was like, “I’m on my way to LaGuardia. I’m coming in today. Is it too late to get a seaplane for today?” And they were like, “No, you can share with Rob Arnott.” I was like, “What?” They were like, “Yeah.” They gave me an American Airlines flight number and just go intercept them at the Bangor airport. I was like, “Okay.” So, I literally intercepted Rob Arnott at the Bangor airport and I said, “Hey, did they tell you we were going to be riding together?” And he was like, “Yeah.” So, I met Rob Arnott who is the chairman of Research Affiliates, most of your listeners will know. And he heard the idea from the moment we got on the seaplane and he loved it and he became our first seed investor. He committed money to the fund before it existed.
We did talk about… I wanted to add some kind of RAFI or value types of metrics to it at the time. And in the end, we didn’t do that because my primary feedback from potential investors was freedom is the most important innovation here, so you should just do that. If we wanted to value emerging markets ETF, we could get that elsewhere. So, I said, “Okay. Well, that makes sense.” So, I just stripped out everything except the freedom component and now the index is 100% freedom-weighted. So, freedom weighting means the freer countries get a higher weight, the less free countries get a lower weight, and the worst offenders as far as personal and economic freedoms are excluded altogether. But going back to the Camp Kotak story, I mean, the way that I met Rob was not something I could have orchestrated. It was bigger than me. And he doesn’t go to that camp every year. He only went that one year. He hasn’t gone back since. I think before then he went like seven years ago. He’s not really a big fisherman. So, he doesn’t go every year like Barry does. But he only went that year because he had lost a bet to Barry and he went to pay his bet. So, that’s the only reason that I was able to meet Rob who became the first seed investor in our fund. He is still invested in the fund and he is also now invested in our company. So, when I tried to shop the idea around to issuers to try to get someone to launch this and nothing worked out, I realized I would have to launch it myself. And I told him that. And so at that time I was like, “I’m going to have to raise money to launch it myself.” And so he decided, “I will invest in your company so you can launch this.” And he believed in the idea that much.
Meb: Perth, you got to CC me on the next fundraise. You leave me out of this cap table. I need to work my way in. The serendipity is something where there’s no guarantee of the chance and lottery of just start day-to-day interactions and something like that happening. And you lucked upon one of the most thoughtful people in all of finance, and they manage… It’s like over 200 billion I think at this point. But at the beginning of my career, and I’ve told this story before to listeners, but I had written…I was a 20 something know nothing who penned his first academic paper and send it… Well, kind of like you, just calling up Research Affiliates just naively emailed it to, like, 12 of the biggest luminaries in our entire world, spam, essentially across the transom. Same thing. I said, “Look, I wrote a paper. I would love to hear your feedback.” And probably half didn’t respond. A quarter wrote, like, really nasty responses. And I’m not going to name names, but I ended up publishing a couple of them on the blog. And I’ve zen been able to, you know, put that behind me. Anyway. But on the positive side, a couple of people actually took the time to respond, one of them being Rob, a million years ago, and they certainly didn’t have to do that and made a big impression and impact certainly on my career and thinking about trying to help out the younger generation and people that email me as well. Anyway, a true match. All right. So, did you catch any fish? What was the camp like?
Perth: That was a really good year with fish. I’ll send you some pictures. But we had like 40 fish in one day or something like that. I don’t know what happened. It was me and Rob.
Meb: Good year for you guys. Bad year for the fish.
Meb: All right. So, things are starting to happen for you. You have this idea. It looks like it might be getting taken to market. What was the on-ramp for that process? Was this like a month, a year, decade? How long did it take? And how did you eventually get it out there?
Perth: I spent about a year trying to find an issuer and everything fell through. So, I talked with the biggest ones. Obviously, they didn’t do it because political issues, weren’t even interested. Some of the smaller ones would take a lot more money typically on my part. So, I tried to focus on the middle, midsize issuers. And a couple of those were interested. And it just didn’t work out with any of them in the end. Either it was a terrible deal that we couldn’t work out or we worked out something. There was one that we got really close, and then we agreed, and then they backed out. It was really sad. So, that was like a yearlong process where I was shopping different issuers. And then I decided, “Okay. Well, I’m just going to have to do this myself, because I’ve exhausted all my other options here.” And I asked alpha architect, Wes, if he wanted to launch this together.
Meb: I like it. You basically, like, you went through everyone and only Wes was left. He’s like the craziest person, you’re like, “Sorry. There’s literally no one else. We’re down to this group in Pennsylvania that works out of a basement. Can you guys help us?”
Perth: That’s not how I would have described it. That’s a great description. I can’t argue with that.
Meb: And so you guys rolled it out two years track. So, let’s dig into the index behind this. Give me the pitch. Talk to me about it. How do you guys construct it? How do you think about the world? You had this view. How did that transform into an actual strategy?
Perth: Yeah. So, freedom is a very nebulous concept. And so the first challenge was to quantify it. And at the time that I first started this, there wasn’t any way to quantify personal freedoms. There were quantification systems for economic freedoms, but not for personal freedoms. My personal freedoms have been more like civil and political freedoms, things like freedom of speech, freedom of religion, freedom of media, terrorism, trafficking, torture, things like that, disappearances. And a lot of the emerging markets, especially the really big ones and the cap-weighted indexes have a lot of issues there. And we believe that freedoms work together. So, you can’t just have economic freedoms without personal freedoms or vice versa, like the parts of an automobile, right? You can’t have a steering wheel without a transmission, the car still won’t run. So, we wanted to have both personal and economic freedoms.
So, I had to… Actually, I have some help with this. But we devised a system of quantifying qualified human freedom data. And it was an ordinal scale system and we put a provisional patent on it. So, I started to try to score all the emerging market countries. And when I went through the scoring process, I noticed that a data source, the Fraser Institute, who were using for economic freedom, had something on their website called the human freedom index. So, I called Fred in my contact there and I was like, “Fred, what is this?” And so we compared notes, and it turns out their system, they had a new system for quantifying personal freedoms in addition to economic freedoms. And it matched my system almost perfectly. And so I was like, “Fred, can I just use you guys’ scores? That would give me full third-party objectivity and save me four months out of the year of scoring countries.” And he was like, “Yeah.” So, I got permission to use their system, which is identical almost to the one that I had a provisional patent on at the time.
So, how that works is, basically, they use 76 different metrics for personal and economic freedoms, the things I mentioned, terrorism, trafficking, torture, women’s rights, they have five proxies for women’s rights including missing women as a metric like the situation in China, women’s rights after a divorce, women’s rights in a marriage, things like that. So, all kinds of things that… They thought of everything. There are political freedoms like freedom of speech, media expression, assembly, civil procedure, criminal procedure, transparency, and corruption. And then economic freedom metrics like taxation, business regulations, freedom to trade internationally, freedom to hold in an offshore bank accounts, sound as a monetary policy. So, there’s 76 different metrics that they use. And they actually use third-party metrics as well. So, there are two levels of objectivity on there. There’s no way they could gain the system and there’s no way I could gain the system. My subjective opinion doesn’t matter at all. And we use the composite score. We don’t pick and choose. You can actually… I could pick and choose any of the 76 to use, but I don’t. I use the composite score so that I have a comprehensive measure of the freedom in each of the countries and I’m not putting any of my subjective opinion and picking and choosing any particular one. All 76 metrics are equal-weighted.
Meb: So, just because you don’t like the people and food in Chile, you can’t be like, “Hey, you guys are out. I’m sorry. I had a bad vacation down in Santiago.”
Perth: That’s right.
Meb: “Hostel manager was a total jerk.”
Meb: Okay. So, what’s the universe? It’s about 20 countries, 25, somewhere in there?
Perth: Yeah. About 26 countries. So, same emerging markets universe that everyone uses.
Meb: Yeah. And so then what do you do? So, you have a ranking from 1 to 26. What comes next?
Perth: So, we use a composite score. And there is an algorithm that turns those scores into weights. The ones that get negative weights are excluded. So, those are your China, Russia, Saudi Arabia, Egypt, and Turkey. We don’t exclude any country arbitrarily. This is all based on freedom weighting. As soon as those countries are more free, and that’s reflected in their scores, we look forward to including them in the index. And so the freedom weighting will give the higher freedom countries a higher weight, or lower freedom countries a lower weight and exclude the worst offenders. So, our highest weights right now are Taiwan, South Korea, and Chile.
Meb: Those are good ones. Then once you have the country and you have the sort of rank order and exclusions, how do you then build a portfolio? Do you take the top 20 names market cap, top 100? Do you do it equal-weighted? Are you weighting them by something within the country? How do you then kind of put it together from the available universe? And it looks like about what? A dozen countries make it through, 20?
Perth: There are currently 10 countries in the index. We use the top 10 largest most liquid securities per country. So, there are 100 total holdings, and that’s why we call the freedom 100 emerging markets index or ETF. So, we do market cap weight the securities within the country. We do cap the securities at 8% at the time of rebalance because two of our largest markets, Taiwan and South Korea. Taiwan semiconductor and Samsung make up about 25% to 26% of their total market cap. If you look at any Taiwan or South Korea index, it’s like 25% of the whole index. So, it would become a bet on two companies if we didn’t cap it. So, we’re making a bet on the freer countries, not two companies. So, that’s why we put that cap on there. We also exclude state-owned enterprises just to take the economic freedom theme all the way through. So, we just use default weighting mechanism for security level within their freedom-weighted country weights. And that was just to isolate the freedom factor.
Meb: Right. It ends up at least looking like, and you mentioned this is not intentional, but just because of the way that it works out is the emerging market indices are very concentrated and dominated by particularly China. You mentioned it. There are lots of countries. There is Saudi Arabia, there’s countries that just Russia don’t make it in, but China tends to be the big exclusion difference versus what you guys are doing, and so the performance disparity, certainly, since the bottom last March, you guys have been doing a great job versus the traditional emerging market indices, I imagine a lot of that has to do with China not playing a role. Is that accurate?
Perth: It is. That’s always the elephant in the room because China has a 40% weight in most emerging markets, indexes and ETFs. So, that’s a lot in one country and it’s not diversified. There’s risk there. And I think that’s a bit distorted. It’s an outsized weight and a distortion of what should be a true market cap. And it shouldn’t be 40% of the index. And so I don’t know what happened there. But there’s been story articles in Wall Street Journal about how the Chinese government coerced MSCI to add A shares a couple of years ago. FTSE already had full Asia’s inclusion before that. I think MSCI probably wanted to compete with FTSE in that manner, so they did the same thing. And also, you know, they were promised market access, which is very hard for a financial company to turn down. So, I think there’s a lot of behind-the-scenes stuff that went on without inclusion. I mean, they decided not to include the A shares a couple of years before then and were blamed as the scapegoat for China’s crash in 2015 and ’16. So, Chinese government blamed MSCI for the crash. They blamed a lot of other things too.
And then, lo and behold, they decided to include A shares with no real changes since the previous decision to not include them. So, anyway, I mean, China does have a big market, but whether there should be 40% of abroad emerging markets EM strategy, that I don’t know. And there’s been a lot of… Recently, I don’t know if you saw the GMO study that came out this month that talked about X China. And it says,
“Basically, should emerging markets be X China? And should China be its own category because it is just becoming such an outsized part of broader emerging markets?” And I would agree with that. And they talked about in the article how country selection is extremely important, especially in emerging markets, much more so than even security selection in most strategies. So, yeah, China being a big part of the other strategies out there does attribute. I mean, we can attribute a lot of our performance differences to that one country because they have such an outsized role in these other funds.
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Meb: And now back to the show. Tell us why you focused primarily on emerging markets. Was it the developed in general tend towards higher freedom rankings? I wonder if there are any just garbage freedom countries in the developed universe too. But was it because there was a wider spectrum of outcomes?
Perth: Yes. So, there is a much higher divergence in freedom levels within the emerging markets. Half the emerging markets by nature are autocracies or just coming out of autocracies. Either they are semi-autocracies or they’re full-autocracies. And also in emerging markets, one of the reasons why people don’t invest in the emerging market is because of the high levels of fraud, lack of transparency. You don’t know what the currency is going to do. Those are the reasons that people typically shy away from emerging markets. And those reasons can all be traced back to freedom. The markets that have the foundation of freedom in place are the ones that are going to have more sound money, they’re the ones that are going to have more sustainable growth, they’re going to have more transparency, they’re going to have less incentivization of fraud and mediocrity, versus incentivizing innovation. They also have less capital flight and capital destruction. So, they are more efficient in their use of capital and labor. So, there’s less people kind of leaving to go to the more free places because capital goes where it’s welcomed and where it’s well treated. So, in the emerging markets, especially, if you can hone in on the countries that have the conditions in place for wealth creation and growth on the ground level, those are the countries that are going to be the ground zero for growth in the next decade. So, we want to be invested in those places that have those conditions in place for wealth creation.
Meb: You know it’s funny, because when you talk to people, investors, almost universally, we’ve long bemoaned the exposure to emerging markets. And you’re aware of this as are my listeners. As far as market cap weighting, it’s up around, I think, 15% as part of the total whereas the GDP is like over half. And all the demographic favor emerging markets and the average allocation and you could probably comment on this too for advisors and investors in the U.S. is 3%. So, it’s like, what’s even the point of allocating? I think that 3% is probably the unintentional forgot about it or included and just don’t know what the fund is doing. But it wasn’t that long ago when the prior decade emerging markets just absolutely stomped everything in the 2000s. And the number one piece of pushback, and so you can start to tell me about your experience too, is literally the objective and purpose of this fund, which is everyone I talked to says, “Well, I don’t want to invest in these countries because of these reasons. I don’t want to support that.” And it depends on the person, what that trigger is, in which the country is. But you mentioned that certainly laundry list of ones and I think there’s some others that you exclude. Let’s see. I don’t see Brazil and Turkey in this one either.
Perth: We have a little bit in Brazil now. They were added in the latest rebalance, not because their score improved, but because India score decreased. And so they were recently added. But yeah, Brazil definitely has some issues, you know, the high homicide rates.
Meb: And how does that work? So, this isn’t something that’s static. So, how do you guys kind of update this? Is it once a year or once a decade? What are the factors?
Perth: Yeah. It’s once a year.
Meb: Once a year.
Perth: Once a year, not once a decade. And sometimes it’s more higher turnover than others. So, like, this year’s rebalance, we do it in January because the data comes out in December, typically. And in January, we had two adds and two drops. So, we added Brazil and Malaysia. We dropped Thailand and India. And that was a very high turnover rebalance. The year before we had no country changes. And we just went back to target weights with the countries and securities.
Meb: And the rankings, in general, is it sort of a situation where they’re just ranked on an absolute measure and you’re like anything above… I’m just arbitrary. Anything above 20 or anything below 20 and, like, you’re out. And so in my mind, what I’m thinking of is, like, if all these countries just decide to be dictatorships and all your freedoms just go out the window, theoretically, would you just, like, own fewer of them or would you end up… Is it a relative to, like, their own history or each other? How does it work?
Perth: So, it’s relative to their peers to each other. So, that’s why when India’s score dropped, Brazil got added. So, it’s relative to their peers. There is no 100% free market. There’s no 100% oppressive market. So, we don’t draw any line in the sand and say, “You have to be above this line to be included.” It doesn’t work that way. It is a relative freedom strategy.
Meb: As our friend, Wes, would say, is there a particular main muscle movement in these rankings? So, does it tend to be dominated by one or two particular factors or data points really, like, “Oh, hold on. A bunch of journalists just got murdered in Turkey,” or, “Oh, hold on. We just cancelled our elections.” Are there some that have a massive impact? What I’m thinking of in particular is some of these freedom trajectories are slow-moving whether it’s civil rights or certain, you know, they may change over years and decades, whereas others are like overnight where things happen, particularly, with conflict, with politics, legislation. Are the things in general that tend to drive it more than others in the short-term?
Perth: So, what I found is that when things are moving upwards, like, freedom is getting freer, then it moves very slowly. But when it’s declining, it can be very quick. So, we have a freedom decline momentum rule that if a country declines too fast on their freedom score in any given year, that they are kicked out of the index even if they were in it before. Turkey triggered this role in 2017. So, they were in the index in 2017, their score declined very quickly, and they triggered the threshold and they were out in 2018.
Meb: Seemingly only getting worse too, right?
Perth: Yeah. So, when it goes down, it’s typically very fast. And you can see that right now with Hong Kong. Every day news comes out of some kind of somebody who they’re doing all kinds of whether the journalists or politicians just national security law is applied across the board to everyone else. So, in fact, if I was in Hong Kong right now, I’d be arrested, definitely, for doing this, so, based on national security law. So, yeah. So, I’m trying to use my freedom of speech that I have here in a free country to buy for freedom in the way that I can through indexing.
Meb: Yeah. You started getting pushback, you started getting some of your accounts hacked yet from nefarious?
Perth: No. I haven’t been hacked. Though my DoorDash account was hacked yesterday. I don’t know what that’s about.
Meb: Because all of a sudden saw somebody ordering a bunch of Chipotle, and you’re like, “What in the world is going on?”
Perth: Yeah. I get a lot of, I guess, on social media people telling me to…yelling at me and stuff and calling me names, but that you have to… That’s par for the course.
Meb: Yeah. You got to have a thick skin, particularly, when it comes from all the anonymous ones.
Perth: And I had to learn that in the beginning because I came from very corporate, you know, like, Fidelity world. And I was like, “What is going on?” You’re used to it. I’m sure. I don’t know if you recall. This is kind of a funny one. In the very beginning before we launched, long before, you and I were speaking at some Market Watch event in Los Angeles, actually. And somebody made the comment, “Hey, Meb Faber is awesome. I don’t know who the rest of these people are, what they’re doing here.” That was actually a friend of mine from back home.
Meb: That’s funny. I was going to say it’s my burner account sub neighbor. Yeah. That was on the roof and was in Beverly Hills. Fancy times.
Perth: Right. That was fun.
Meb: That was fun.
Perth: I almost tweeted a picture of you getting your eyebrows done.
Meb: Oh, that’s right. I forgot. These guys are getting bushy. It’s about time to go back into the… That’s the downside. I haven’t had makeup on in like two years. Okay. So, what other sort of… You talk to probably thousands of investors, allocators. And, like, with any fund or strategy, you probably get consistently the same pushback whether it’s informed or not. Tell me about a few of the sort of questions or responses people have because this is an obvious idea. It’s a unique idea. I don’t know really anyone… I mean, despite how popular ESG is focusing on this concept in isolation, what are the haters, detractors, but also people that are just reluctant to embrace the idea? What do they say?
Perth: So, I think there are four times… A couple of things and it changes over time. So, before it was like, “How can I not have China in my emerging markets?” And so those people they would just put FRDM with UILD or they’ll put FRDM with another emerging markets fund. So, they’ll do both. But that was a big one in the beginning. And now I never hear that. I literally get most of our clients from people who don’t want any China.
Meb: It’s funny how the performance changes the narrative pretty quickly. But also, China has had quite a bit of negative news flow coming out with the camps and everything else.
Perth: It’s every day. I never imagined that it would be like this before. I would be the only person that knew kind of the stuff going on in China. And now everyone else knows. I don’t even tweet about it anymore. And I used to be the only one. I remember. And people thought I was crazy. And so that’s really changed. I think China is interesting story because any country can have limited growth on limited liberalization. And they had a lot of growth on just a small liberalization over the last 30 or 40 years coming out of the Mao years. They liberalized from that on the economic freedom side, and that created all of this growth. And that was amazing.
But without coupling that with personal freedoms as well as economic freedoms, that growth has hit a plateau and now this pendulum is swinging the other way. You can see with… And financial is happening with Jack Ma. Where even is Jack Ma? We don’t even know.
Meb: Yeah. You got any insight? He seems to have just disappeared into the ether. He reappeared and looked terrible for, like, one showing, and then just back to who knows where?
Perth: Yeah. So, that’s the thing in these unfree markets. And where are the other tech entrepreneurs in China? They’re all silent right now. And that’s not an accident. And that’s what happens. Sometimes it’s a risk in these unfree markets that the government can just come in and tell you how to manage your company. They can come in and stop your IPO. That was the biggest IPO ever, like, in the world and it just disappeared. So, yeah, I don’t know what’s going to happen with it now. I don’t know what’s going to happen with the tech names in China. All I know is that pendulum I can see it swinging the other way. And I think a lot of people see that. I actually saw a paper about how Chinese investors or people that are invested in China are starting to take the gains off the table because they made a lot of money and now they see that that’s perhaps a growth story of the past and they’re getting out now. So, we don’t get that objection anymore.
And I find that, like, as far as specific countries sometimes because we’re active on social media and we have followers from all over the world, which is great, I found that there’s a huge discrepancy between the way some countries, people on the internet respond to us not including their country and others. So, I was actually in the New York subway a couple of years ago. This is before we had Brazil in the index and they’re very small now, but they didn’t have any allocation before. And I ran into a couple of Brazilian girls on the subway. And we got to talking. They were actually human rights lawyers, three of them, and they were in New York for some human rights thing, and so we started talking about this because it was, like, similar to what they do. And they were like, “Is Brazil in your index?” And I was like, “No.” And they were like, “Yeah, sounds about right.” And I hear the same, like, we have a mid-size allocation in South Africa. People from South Africa are very supportive of what we do and they’re like, “Yeah, I can see why it’s not a higher allocation.” Same with Mexico and same with India, when India had a small allocation. But from China, I get all hate. And they don’t even have access to Twitter. So, few people that are either in Hong Kong or somehow have access to Twitter, like, give me so much grief over this. And I’m like, “Look, we’re not even… We don’t exclude China arbitrarily. It’s just freedom weighting.” So, yeah. So, I see a lot of differences in how countries where they’re allowed to criticize their government, how they react to something like this, versus countries where they don’t have that freedom.
Meb: They’re just logging in the credit. They want to email so they can print it out and be like, “Look, see, I was supportive of the government.” China has the, not totally unique because there’s two countries to my knowledge, designation of being only one of two stock markets that just straight up went to zero, shut down. So, it was China and Russia. So, Russia in 1917 and China in 1949. Other countries have obviously had declines, U.S. great depression, Japan, on and on. But these just shred straight up, “Thank you. We’re going to take your investments. Goodbye.” Which is something that you have to at least mentally be aware of that has happened in history.
Perth: That sounds very similar to what happened with Ant IPO. Like, “Thank you. Goodbye.”
Meb: Yeah. Well, you mentioned an interesting takeaway that, in my opinion, a disturbing trend of particularly the younger generation just not having the history and experience of things like capitalism and free markets versus socialism in countries where people have lived there or experienced repressive regimes like you mentioned. And the crazy thing is, if you talk to any person from those countries, they’re universally just astounded at how people could possibly have these sort of views. They talked through living through Russia decades ago, living… Oh, my God, Venezuela. It’s so sad reading all these reports of what’s going on and so many cases, you just… It’s heartbreaking. But this lever of saying, “Hey, you’re right. Money, reasonably, should go to the places it’s best treated.” And will that have a lever and impact on those actual governments and policies? Hopefully, that actually has a real positive impact. Is that your experience too, I mean, in a lot of these countries, your personal experience, but where people kind of scratch their head? That’s weird. The one exception of China. I wonder how much of a roaring bull/bear market would change that opinion.
Perth: Yeah. I mean, I don’t think China would sacrifice their stability to let their market be free enough to have a roaring bear market again like in 2015 or ’16. And they tried to stop it then. But I think the lack of growth in the future is going to possibly change some minds here, especially if this trajectory continues where they’re clamping down on entrepreneurs and business people in addition to everyone else. When you invest in these countries, first of all, you decrease their cost of capital, the cost of capital of these firms, and kind of diminish their risk of putting the state’s interests ahead of shareholders. So, you’re helping them to do the state’s bidding by lowering their cost of capital so that they can do so. Also, a lot of these companies have opaque ownership structures. So, you don’t really know. So, if you looked at Ant Financial and who was going to benefit from that, a lot of it was government actors and their buddies or their family.
So, you don’t know who owns these companies, and especially the biggest names are going to have a lot of that. So, you’re enriching government or state actors and their cronies by investing in some of these big firms. And you’re also giving that country more leverage with international bodies, rulemaking bodies, who tend to favor short-term economic gains over human rights practices and things like that. And we saw that in Europe when they decided to do this trade agreement with China recently and then now it’s been stalled because of China’s actions. So, even people who don’t necessarily describe themselves as free-market capitalists are seeing the risks of investing in unfree markets. And that’s a trend that I see with our clients because not everyone that invests in FRDM is described as themselves as capitalists or free-market capitalism. They’re not all Rob Arnott. So, I see that pattern because of the human rights, because human rights is apolitical. And I’m proud that this product appeals to people from all political mindsets in both aisles of the spectrum because of that human rights.
Meb: And you have a big allocation to what we calculate is the cheapest country in the world, Poland.
Perth: Yeah. Yes.
Meb: That’s my current, as of last quarter, cheapest country in the world, which, I mean, some of the numbers out of there, it’s like a 10 PE. I would have to look it up the rest of the stats. Let’s see. Where are you, Poland? Here we are. Yeah. I mean, the sucker is ranking about as low as it gets on every measure, cash flow, dividends, price to book. So, you should get some tailwinds there. What is there out there in the literature kind of around this topic? Is this sparse? Is it something where there are a lot of white papers? I imagine there’s a lot in the economic literature. Is there a lot in the sort of investing literature about it or not so much?
Perth: So, if there are a lot, I don’t know about them. So, I’m not an academic, but Wes has looked into this and he’s found one by Dhishni who it was about corruption. That’s the closest one that I found. So, that paper would be probably the best one out there. There hasn’t been one done on freedom in general, especially human freedom, which is the combination of personal and economic freedom, just because those metrics are so new. And like I said in the beginning of this project, I didn’t even have those metrics. Economic freedom has been done. There’s one by a friend of mine, Marshall Stocker who works at Eaton Vance now. That’s very old one where he kind of said, it’s more about the change in freedom than the absolute level of freedom. I disagree with that because if we just use the countries that have the most potential for change, we would have, like, Venezuela’s of the world in there. We would have included Argentina because we thought they were going to change. So, we use the absolute relative freedom level. So, yeah. So, those are the only two that I’m aware of. Somebody should write one. We should write one.
Meb: Yeah. Listeners, if you find anything, shoot it our way. Let me know. We’ll post it to the show notes. We would love to see some. I know the Dimson, Marsh, Staunton crew has written extensively and a lot of others about emerging markets, but not specifically this factor, I don’t think. I’ll have to look into it. It’s ringing a bell, but I can’t place it right now. Who’s been most investors so far? Right? You’ve been a FinTech success story. About 50 million in there in 2 years, Perth. That’s impressive. Has it been individuals, institutions, endowments? Who’s kind of the main use case thus far?
Perth: As far as I know, it’s all retail, retail and advisors. I’m including advisors in there. So, independent advisors who have access to it because until it gets to this size, we didn’t have access to…a lot of advisers didn’t have access to it, unless they were open architectures, including those advisors who are open architecture and retail.
Meb: Right. So, the free thinkers or as I like to describe them, the independents who don’t have to adhere to very… It’s kind of like we should do a freedom ranking on the advisor platforms. My goodness. Some of these rankings and gating’s and the ones that charge these days, well, the good news is that’s going the way of the dodo bird, but…
Perth: Do you think so? I hope you’re right.
Meb: It is. It’s not I think so. It’s inevitable, as Dantos would say. The funny thing is, particularly as you scale, and this is more of just a brainstorm idea, I would imagine, there are plenty of institutions, particularly the ones that focus on ESG that are mission-driven that have this in mind that just haven’t heard of it that will eventually be the adopters. I would think of this strategy because you got to remember that most advisors institutions, it’s so much… I mean, obviously, the products got to be good. And it can’t be garbage. It can’t be some stupid IFI and tax-inefficient, which we just described, the majority of the legacy asset management business, again, which is also going away. But something like this checks those boxes, but then it has the story and something that people can talk about that makes sense. It’s an obvious idea, but I would think you’re going to find some champions, eventually, in the institutional space, wherever they may be. I’m not sure. But certainly, they’re out there. And the younger generation, I think, is even more attuned to some of the things you’re talking about on the ESG side. So, CalPERS, if you’re listening, if I haven’t offended you enough already in my tweets, hit Perth up. All right. Here we are in 2021, Perth. What does the future look like? As you look out to the horizon, what are you thinking about? What’s on your brain? Any other crazy funds you got in the hopper? Want enough? What’s on your mind?
Perth: I hear all kinds of fund ideas now from people just randomly and I think they’re great. There’s a lot in the pipeline that you’d like to do. We’re still focused on the flagship, though. So, at this time, I do not have plans for a second launch, though, we have a lot of ideas in the hopper that we would like to launch at some point. So, we are still focused on the freedom 100 strategy for now. You mentioned some things like ESG and, you know, some things that could be added. We talked about developed markets, U.S. It could be applied there. It could be applied also to fixed income. But there’s complications with each of those developed markets. There’s not as much value add because they’re all pretty free already.
Meb: Well, the fixed income would be a really obvious extension, although the interest in the bond world is like a totally different animal, right? No one in the planet in the U.S., despite being the largest asset class in the world, wants to invest in foreign bonds, for whatever reason. If there is no interest or just people. But I think if it’s in this emerging market world where you still get 4% or 5% yields, 6% yields, potentially that’d be interesting.
Perth: Well, we should talk about that then, Meb.
Meb: Yeah. What would the ticker be for the freedom bond index? We’ll marinate on it. But that’s an obvious extension. I just reserved ETFs. Did you see that?
Perth: That was free?
Meb: I don’t know how that was… Right. Well, that was free. They’re all free, but it was available.
Perth: No. I meant, it was available.
Meb: It was open. Oh, yeah. Free available. Yeah. Well, my idea is I’m frustrated because I speak to investors every day that want to invest in the ETF industry. And there’s no way to do it. There’s one ETF publicly traded company WiSentry but they are large. They’re one of the big dudes. And then there used to be an ETF index that tried to encapsulate the entire ETF ecosystem, which our friend Mike Venuto was involved with, but it’s gone. And so I would like a pure-play asset manager ETF. And I was joking then I said, “I would love for someone to roll up some of the smaller ones and do a SPAC.”
Perth: That’s a great idea.
Meb: It’s a great idea. I don’t want to do it.
Perth: Why don’t you want to do it?
Meb: But listeners, if you want to do it, let me know. Being a public company sounds like my idea of a total nightmare. However, I think an equally interesting idea is to just raise a little $10 million, $20 million, $30 million, $40 million, $50 million private equity fund and invest. And we know where all the bodies are buried in an industry. Invest in, say, 5 or 10 of what we’d consider to be the best companies and products. And you have a… I mean, the industry-wide is growing at 25% growth rate versus the broad mutual fund space which I think it’s hitting an inflection point in the last two years based on a couple of factors, one being, in particular, the new ETF rule, but also proposed tax rates going up. If we ever have another bear market, I think they not cease to exist, because there’s a lot of inertia in prior holding sitting in the retirement space, 401Ks, but I think it’ll be incredibly diminished. Anyway, end of rant. So, listeners, you got any good ideas, hit me up.
Perth: Yeah. No. I love that. Yeah.
Meb: Perth, you already got a book recommendation for me.
Perth: Oh, that’s right. So, we were talking about you kind of travelling the world to some of the more unfree markets. This book called “Socialism Sucks” was written by Bob Lawson and Benjamin Powell there. Bob Lawson is on my board and he’s the author of “The Economic Freedom Index and Data Set.” He and Ben just went and travelled to the most unfree markets in the world. They went to, like, Russia, Ukraine, North Korea, Venezuela, China. So, they literally went to as many countries as they could and just drank beer and talked about it and tried to meet people and talk about situations and wrote about it. So, it’s an extremely fun read.
Meb: Good. I want to talk to him. That sounds like a guy I would like.
Perth: You should totally talk to him. I can hook you up.
Meb: As you just did the list of those countries, I was thinking in my head that these are also a high correlation with terrible beer. And I love plenty of countries. I love Mexican beer. I love Japanese beer. But a lot of the ones you just mentioned are certainly not known, particularly, for their sort of national brands as being Singa, Tsingtao, all these not being particularly delicious beers. So, maybe there’s a beer index there too.
Perth: I will make that introduction for you.
Meb: I’ve never even heard of that book. That’s rare, Perth. I’m excited to check it out. You know, it reminds me. I mean, this was to my early inspiration career. If you look at some of the most influential books and stories, the Jim Rogers books, “Investment Biker,” “Venture Capitalist” had a huge impact on me looking at investing in certainly these developed and emerging and obvious third fund for you after the bond one is frontier markets. To my knowledge, I think there’s only one frontier ETF out there at all.
Perth: I am so close to that one, I can’t even talk about it.
Meb: Good. Good. I love that. Talk to me when you open up the cap table. That’s an interesting idea.
Perth: Do you know what the freest frontier market is?
Meb: Let me think about it for a second.
Perth: If you guess that, I’m sending you a free book.
Meb: Okay. Hold on a second. Is Uruguay considered a frontier or do they even have any stocks?
Perth: It is. It’s considered a frontier. Actually, you know what? I don’t know. That’s a good question.
Meb: Give me three guesses. Hold on. Okay. There’s that. I’m trying to think if there are any traditional European countries that are considered frontier. Hold on, hold on, hold on. Let me go through it.
Perth: If you want three guesses, you have a time limit.
Meb: Oh, wait. I know. I know. It’s got to be one of the Baltics. Is it like Estonia, Latvia, one of those?
Perth: Oh, my gosh. You’re pretty good.
Meb: Which one?
Perth: It’s Estonia.
Perth: Nice work. I’ll send you a book.
Meb: Well, the only reason is because I got to give a talk in Estonia a couple of years ago and I absolutely loved it. Vilnius magical city pre-pandemic. Awesome, awesome people. It’s so much fun. But yeah, I mean, you can feel the capital. There’s very much free markets capitalist vibe. There’s a lot of entrepreneur startup energy going on. And I’m sure it’s only more few years later.
Perth: It’s the Silicon Valley of Europe.
Meb: Good. Well, I mean, it was a gleaming shining city.
Perth: The only issue with creating a product with Estonia in it, though, you notice there is no product with Estonia in the United States. And that’s because of the lack of liquidity. So, that’s the only issue.
Meb: Always a pain in the butt with the custody, but I feel like it’s getting easier. We’ve certainly had some internal horror stories, but it’s funny if you look at. A lot of people are surprised. And you say, “Really?” You think it’s weird some of the stuff we own. Go type in at Vanguard or any of these big shops, emerging markets bond fund. And you have stuff in Kazakhstan, Iraq. There are countries that I’ve never heard of in there. So, people are constantly surprised about know what you own. Go look up your Vanguard.
Perth: Even equity.
Meb: Yeah. Yeah.
Perth: I mean, we have better underlying liquidity than VWO if you look it up on Bloomberg because they’re looking at the least liquid securities in there.
Meb: Can you expand on that because that is a… I mean, we went back 10 years and talked about advisors, institutions understanding ETFs. I mean, at that point, they’re like, “We didn’t even know what ETF was, EFT.” They kind of knew. But advisors, I feel like at this point…
Perth: They’ve come a long way. Yes.
Meb: They’ve come a long way. Ninety-nine percent are fully versed on the main parts. There’s like two or three things that still consistently trip up in every conversation. That is probably number one. Can you explain what you just said and what you meant by that discussion of liquidity?
Perth: Underlying liquidity or implied liquidity is the liquidity of the basket of underlying stocks. And that’s what really matters when you’re trying to, for example, buy or sell an ETF, not the actual total ETF itself. It’s liquidity, but the underlying liquidity of what it’s holding of its holdings. So, on Bloomberg, there’s a function for you to look that up. I don’t remember the code, but there’s a function and you can look it up. And it’ll tell you how big of a basket you can buy without moving the market, basically. So, that is the most important liquidity measure when you’re looking at an ETF. How would you describe it?
Meb: I mean, it’s much more succinct way than I would have said it, but the example I like to give I say, “Look, let’s say hypothetically someone saw an ETF like yours and let’s say hypothetically I have no idea what the daily volume is. Let’s say it’s 1000 shares. So, it almost never trades.” But then you have VWO, which trades, I don’t know, 100 million shares a day, not that much. Let’s call it 10 million shares a day. And you said, “Which one is more liquid?” Everyone would say VWO. But the concept that what it holds, and a more extreme one would be like, “What if you had an ETF that traded and was able to own just Estonia, small-cap tech stocks?” I mean there are probably two of them. But the takeaway is that despite the onscreen liquidity, you can put orders in particularly if you’re an institution buying 50,000 shares or more and, basically… I can’t say always, but almost always be right at net asset value, maybe plus or minus a couple of pennies, but you can do that at size. So, 10 million, 50 million, 100 million. And you see these trades go off now. They’re in the billions. So, an important note because people are still living in sort of the market orders on screen liquidity world or big disadvantage. Perth, what’s been your most memorable investment? Anything come to mind across your career spanning Fido, your startup? Everything in between?
Perth: I once invested in one token share of Google back in the day when I didn’t have any money. And they set up against the Chinese government on censorship.
This was a long time ago. And that one share, I think it was like $500 at the time, it multiplied itself and I ended up donating it through my charitable giving account because it was so…it went up so much. So, yeah. I still remember that one share. I didn’t have enough money to buy two shares.
Meb: Yeah. Well, now we have fractionalization, but also, I thought that was going to go a totally different way when you said a token. I was like, “Oh, geez. If she starts talking about Dogecoin or something, I’m going to just stop the podcast right now.” Perth, people want to find you. Where do they go? What’s the best places to keep an eye on your current going and future going ons?
Perth: Yeah. So, our index website is lifeandlibertyindexes.com. Our fund website is freedometfs.com. I’m on Twitter @Perth_Tolle and on LinkedIn.
Meb: Perth, we’ll do it again. Thanks so much for joining us.
Perth: Thank you for having me.
Meb: Podcast listeners, we’ll post show notes to today’s conversation at mebfaber.com/podcast. If you love the show, if you hate it, shoot us feedback at email@example.com. We love to read the reviews. Please review us on iTunes and subscribe to the show anywhere good podcasts are found. Thanks for listening, friends, and good investing.