On today’s show, we talk to Dan Heath. Dan is a graduate of Harvard University and is a Senior Fellow at Duke University. He is a three-time NY Times Best Selling author of various business books. Dan talks to us about his newest book, The Power of Moments.
In this episode, you’ll learn:
- How to change your life and business through significant moments
- Which moments that can create short-term and long-term happiness
- How to level up on your skill set, just like a computer game
- Ask The Investors: What is the intrinsic value of Bitcoin?
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Podcast Transcript and Summary (automated)
Preston: [00:01:43] So the first thing that I think whenever I’m looking at this book and all the stories that are in it is are in a world that you get the idea for this like what triggered your thought process to write a book around this idea because it’s such a fascinating thing once you start pouring into it.
Dan: [00:01:58] You know there is actually a very specific moment in time that I look back on as the birth of this topic. My brother Chip and I were sitting in our dad’s office at his home in Durham North Carolina. It was Christmas and we were in the midst of a discussion about a book that we later abandoned. And this is a book we’ve been working on for maybe six months and in this brainstorming that day in the office it just became clear to us that we were kind of forcing it. We weren’t that excited about the topic the conversation had become this slog and at some point in that conversation, we got on this tangent about moments. I’m not even sure how we ended up here. I think it was just some desperate attempt at procrastination. To be honest with you, but we started just this whirlwind brainstorming about why it is that in virtually any length of experience that you have in life there are a handful of moments that stand above the rest. And in fact with time those moments may be the only thing you retain from the experience and the weird thing is that that’s true of a dinner. You know you might have a spectacular appetizer or a great glass of wine.
: [00:03:07] It’s true of a semester in college. You know you might remember one professor on a particular road trip. It’s even true of your life as a whole. You know you talk to the people in their 70s or 80s or 90s about their lives and it’s easy for them to come up with a dozen moments that may have shaped who they are and so we started talking about just this insane power that particular moment seemed to have that one moment might have 10x or a hundred acts the meaning and memorability of all the rest. And so we started brainstorming at first is this kind of intellectual exercise but then it occurred to us there are a lot of people in the world who are in the business of shaping moments. You know you think about Disney World and the fact that there’s somebody there who is trying to scope out the best place for families to take their photos and to set up these little you know landmark photo opportunities. You think about the Olympic medal ceremony you know that kind of moving moment when someone who’s won the gold medal stands on the podium and the anthem plays. And just a beautiful moment that is and somebody in human history sat down and scripted out what that would look like and talked about the details.
: [00:04:15] We even talked about my brother and heard the story about BMW. The story is that they had this engineering team that was working to perfect the ignition moment. You know you turn the key. You push the button and the engine is to life and that my brother had heard that they made use of kind of acoustic trickery and other things to make that moment seem really muscly and they did kind of thing that will get your pulse pumping as a driver. And so as we went through this discussion I mean we spent two hours just on this manic brainstorming session about moments and the research that ties the moments and the stories of moments in political moments and emotional moments and personal moments and we come out at the end of this all our families sitting in the living room and we kind of triumphantly announce that we’ve got a new book. It’s going to be a book about big powerful defining moments. And as we announced this we look around the room and there’s this and a visible sense of relief on their faces because apparently all of them hated the prayer book idea were just too nice to tell us. So that was the birth of this book. I love it.
: [00:05:22] So whenever I hear that moment especially when you’re talking about with BMW that’s a branding and marketing thing. I mean really it’s branding marketing when we’re talking business you know we’re talking more business here than investing when a business is developing a brand and a market for something. What better way to do it than that moment that you’re talking about so I guess my question for you would be this so we have a lot of business leaders and executives that listen to the show. How can they use this approach of constructing a moment to benefit their companies whether it’s branding or it’s just employee recognition. Talk to us about some of those ideas.
: [00:06:03] Let me tell you a story that I think captures the meaning for business leaders. So there’s this hotel in Los Angeles called the Magic Castle Hotel. And I know you’ve got listeners all around the world. So if you’ve never stayed there I want you to just picture in your mind the magic all hotel OK. Now what I want to tell you next as whatever is in your head right now it looks nothing like that. It is actually a two story apartment building built in the 1950s that was later converted to what is effectively a motel. It was painted bright yellow. It is utterly average to look at. It looks nothing like a castle. The rooms are average. The lobby is average. The courtyard where the pool is is average so that would be the end of this story if it weren’t for one particularly remarkable fact and that is that this hotel the Magic Castle Hotel is ranked the number two Hotel in Los Angeles according to Trip Advisor based on housing reviews. It outranks hotels like the Ritz Carlton like the Four Seasons and so you just kind of slap your forehead and say How can that possibly be true. Well the executives at the Magic Castle have figured out what moments can do. So if you stay there as I did you started noticing that they do these remarkable things one of which is there’s a cherry red phone mounted by the pool and just above it is a sign that says popsicle hotline. And so if you’re brave enough to go over and pick up the phone somebody answers popsicle hotline may I help you. And you can order a grape and Cherry and orange popsicles delivered to you right it will side on a silver tray by someone wearing white gloves like an English butler all for free.
: [00:07:50] They have a snack menu where you can get for free. Jack Sour Patch Kids cream soda. Just for asking for it at the front desk. They’ve got a board game menu a movie menu. They’ll do your laundry for you if you drop it off in the morning they’ll have it back to you at the end of the day. Got magicians that do tricks in the lobby. And so when you start to understand that side of their business now you can understand how people could really appreciate this experience how they could find it one of the highlights in their vacation even though a lot of the amenities might be very or buy Ritz Carlton standards. And so I think the importance of that story to me this is not a story about popsicles or even a story about the hospitality industry. This is a story about experience and what we know from research and memory is that when people look back on their experiences they don’t just kind of load them up like a video that you can watch beginning to end. But in fact most of what we experience fades out and what we’re left with are particular moments and there’s actually some research that explains why we remember the moments we do. In fact there are two kinds of moments that we disproportionately recall. There’s the peak of the experience which is the most positive moment in a positive experience. And there’s the ending. It’s called The End principle. And so when you catch on to that as someone in the business world especially service leaders what you realize is that to have a really great experience for the people you serve whether that’s customers or patients or students or otherwise.
: [00:09:25] Not every aspect of that has to be brilliant. Not every aspect has to be perfect. You know I think there’s this illusion that in order to do something great it’s got to be nonstop greatness. Every detail has to be perfect and in fact what we know is that a lot of great experiences are actually mostly forgettable but occasionally remarkable. And that’s the story of the Magic Castle that despite a lot of average a lot of mediocrity these special moments like the popsicle hotline that’s what endures in their customers memory. That’s what makes the experience special. But here’s the bottom line. These remarkable moments don’t plan themselves. And so if you’re in the business of providing service to customers and you haven’t thought carefully about peak moments. That’s a huge opportunity. I
: [00:10:14] Absolutely love that what a great story and so much fun that you talk to us about how we probably envision this hotel. I almost had. There’s still a land kind of image in my head whenever I write the name the first time in the book until you started describing the facilities. And I was thinking why would it has such great use but it really makes me think of a quote that we had a few times on the show. Palmer and Lewis say something like People will forget what you said. I’m your death. But they were never ever forget how you made them feel. So I guess my next question would be is that really what this comes down to in terms of what is it that those businesses are doing other targeting people’s emotions and how do they do it.
: [00:11:04] No question yeah. Emotion is at the heart of what makes experience as powerful what makes moments powerful and in the book. The book is organized according to four elements that we saw recurring again and again and different kinds of peak experiences. And those four elements are first elevation. These moments tend to produce positive emotions like joy or delight or surprise. That’s the popsicle Hotline’s story it’s a great moment of elevation you know on a sunny Los Angeles day someone brings you a popsicle on a silver tray. The second trait is insight. What we found is that there are moments in life when you’re just kind of Thunderstruck by a realization maybe it’s something you’ve realized about yourself. Maybe it’s a moment when you realize you know I can’t take another day of this flipping job like this is it. You know these epiphanies these realizations. The third element of defining moments is pride. If you look at people’s careers and the moments they remember from that they tend to remember these moments where they were recognized for something they had done. Maybe you got an award or maybe your praise for some work you had done or maybe you accomplished something you weren’t sure you’d be able to maybe you weren’t recognized by others but you just felt this intense sense of pride having conquered something big that you’d set out to do.
: [00:12:19] And then finally the fourth element of these moments is connection that so often these special moments tend to draw us closer to other people whether that’s in a one on one relationship. We’re often groups bond in moments that require them to do something dramatic something that forces them to struggle. Think about boot camp is kind of a classic example of that a bunch of people who are strangers to each other and different in so many ways are bonded for life as the result of this kind of gruelling experience that they have to go through together. So when we talk about creating better experiences for the people we care about whether that’s customers or patients or employees. These are the ingredients we have to work with. Now what we know is that great experiences hinge on peak moments. That’s the first part of the story. And then the second part of the story is the peak moments are built from elevation inside pride and connection.
: [00:13:14] So I’m sure you get a lot of e-mails and feedback from your readers. And what would you say is the most surprising feedback that you receive from some of your readers on the book.
: [00:13:26] I think some of the most surprising feedback is just people kind of chuckling at their own organizations about how bad they are at this stuff. I’ll give you an example. We did some work for a retail bank in Australia and we were talking about retail banks are unusual businesses in that they have such a long trajectory with customers. I mean you could have a relationship that last 30 40 years and because of you know what banks do. They’re often part of really important events in your life. You get married. Now you’re adding someone to your account or you switch jobs and you may have new sources of income or income dropping off they’re managing your mortgage. That’s a really important thing. And so we talked about how emotional these moments are and we were talking in particular about the importance of transitions which is a theme in the book. If you look at the big rituals that cultures evolve over time so often these rituals are pegged to transitions. So think about a wedding day and the ceremony and the dancing and the food. I mean it’s a ceremony to celebrate a transition and a couple’s life graduation ceremony to celebrate a transition rites of passage ceremonies ranging from quinceañera to bar mitzvahs their peg to transition’s and so when you catch onto that it makes you start paying attention to the transitions that are important in your work or in your life.
: [00:14:47] And so back to this bank we were saying you know think about the moment when you finally pay off your mortgage potentially 30 years later. You’ve been diligent you’ve made every payment. That is a heck of a transition. Not to mention an end. Back to the again principle. And so we were saying you know the way this should work is that when you make that final payment someone comes out and visits you from the bank knocks on your door they’ve got flowers and they’ve also got your deed and they shake your hand and they say you know great job you’ve been at this a long time here’s the deed to your house. That’s an emotional moment. That’s a peak moment. And then someone in the back of the room raised their hand and said you know not only do we not do that we actually charge people a deed transfer when they complete their mortgage deed transfer fee. And so you know back to your question it’s like what people are sending us a lot of times are the deed transfer fee equivalence from their respective organizations it’s just like they have these these epiphanies where they slap themselves on the forehead and say how could we have missed that. That were actually charging people money at this moment that should have been the culmination of a long and successful relationship.
: [00:16:02] What an example does that mean when you think about it they’re opposite. What they should be.
: [00:16:08] You know that’s I mean they’re just they’re squandering. I mean banks like many businesses talk a great game about relationships and all the TV ads you know have people holding hands and soft lighting and we’re all about the customer relationship. Well here’s an example of where they’re just essentially taking dynamite to a relationship and taking on positive emotional culminating moment and turning it into a minor transaction fee. And that’s just malpractice.
: [00:16:36] Yes. So Dan what I have to admit one of my favorite stories in this book was the poop story of the people here and this right now are like What is he talking about.
: [00:16:48] I want you to tell this story because whenever I was reading this in your book I was like This is a flippin home run. What he’s saying right here. So can you tell our audience this story the poop story.
: [00:17:01] Absolutely. OK so let me let me give you some backstory. First of all I feel a little silly saying Who that’s the word we use in the book is the S word or feces. By design as it as we’ll get to in a minute. But just for the sensitive ears and the audience will we use you so backstory a lot of communities in the world are still practicing open defecation you know i.e. people pooping in public and as you would expect that comes with a lot of health consequences it can lead to the spread of diseases like cholera bookworm roundworms schistosomiasis some more. The really bad problem and so a lot of social sector organizations are trying to fight this. And for many years the obvious solution to this problem was well if people are whooping on the ground in public let’s give them some latrines let’s give them some facilities so they have a place to dispose of their waste properly without endangering their neighbors and themselves. So there was an organization called Water Aid that had funded the construction of some latrines in northern Bangladesh. And our story starts with a guy named Dr. Kemal Carr who was hired to go assess that work. So they paid him to go to northern Bangladesh and check out where the latrines installed properly where people using them. So for so Dr. Carr It’s K.R. by the way. He goes to this community.
: [00:18:20] He founds latrines were perfectly well built. They were installed properly. He also found something that was a little more surprising and that was everywhere he went in the fields around the villages. He stepped onto open defecation was still rampant there despite the latrines and he said it was an eye opening moment for him because he realized that the development organizations in the world had been thinking about open defecation as a hardware problem. Like if we just get enough latrines out there we’re going to fix this. But what Dr. Carr was saying was it wasn’t that simple. Some villages were simply you know set in their habits they’d always done it one way and they were going to switch and others were kind of confused by the latrines like in some places the latrines were some of the fanciest materials in the whole village and they felt uncomfortable. You know come to defecating in one of the best places in the village and so Dr. Carr realized that open defecation wasn’t a hardware problem it’s a behavioral problem that until the people in a particular area wanted to change the mere existence of latrines wasn’t going to help. And so he developed a methodology that’s called Community led total sanitation abbreviated TLT yes that sounds super boring but let me tell you this is anything but a boring process. Let me just walk you through what happens.
: [00:19:45] So a facilitator of the practice is the seal TS methodology. Picture a stranger arriving in a village kind of shows up and says Hey I’m studying the sanitation profiles of different villages. Do you mind if I look around and ask you some questions. And so he tries to hang around long enough that he’s got a small crowd with him and he conducts a walk from one side of the village to the other and he starts by asking some questions and he says Well where do people poop here. And so they point him to the right place and he kind of lingers there uncomfortably they’re a little bit embarrassed you know there’s poop everywhere but he gets interested he says you know who’s poop is this. And he waits for someone to raise their hand and he asked did anyone Peucker today and a few more hands go up. And then he asked really seemingly gross questions you know why is this hoop yellow why is this one. BROWN And you know there’s flies everywhere he says are there often flies here and people nod and then you know maybe there’s a chicken kind of pecking around in the area and he asks you know do you eat this kind of chicken. He’s been trained to only ask questions you know he’s not there to pass judgment or or assert the truth he’s just asking questions and so they finish this walk they come back to a big public space and by now the crowd has grown a little bigger because people are just curious about what’s going on here.
: [00:21:01] And he asked them to draw out in the dirt a rough map of the village and so they sketch out into the boundaries of the village and then landmarks you know here’s where the school is here’s where the church is and there’s a stream that flows this way and and then he asked the people around to put a stone or a leaf to mark where their individual homes are. So they’re kind of drawing this community map and the dirt together. And once the map has been fleshed out he brings out this bag of yellow chalk that he’s brought and he asked them to sprinkle some yellow chalk on the places where people who and he says where there’s more poop use more chalk. And so people are kind of giggling nervously. But the kids get a kick out of this. They love to sprinkle the chalk and of course they know where the areas are so they do that and they’ve marked the open defecation areas and then the facilitator says well what about in an emergency. Let’s say you know if there’s a rain storm or if you have diarrhea and you just you can’t make it to that area and so out comes more chalk and you know you know now people are scattering it all around sometimes it’s just around people’s homes you know because they can’t make it to the common areas.
: [00:22:07] And at this point it’s hard to miss that basically the entire village is covered in yellow chalk and the crowd is starting to get a little bit anxious. There’s just a weird energy there a little bit disgusted a little bit embarrassed they’re not sure where this is headed. At that point the facilitator asked for a glass of water so someone provided the water and he asks a woman in the crowd what she feel comfortable drinking and she says well yes of course. And he asked others and they said yes we would drink it. He then pulls a hair from his own head and he said what’s in my hand here. The crowd says a hair and he says can you see it clearly from where you are and they said no not really. And then he walks over to a pile of poo near the area where they’re meeting and he visibly dips this hair into the pool. And he comes back and he plunges that dirty hair into the glass of watery swirls around. He hands the glass to one of the villagers and asks him to take a drink. And the man refuses. For obvious reasons and the facilitator says Well why do you refuse.
: [00:23:15] And the guy says Well because as Hugh Bennett the facilitator looks puzzled and he says how many legs does a fly have. People say six solitaire says you’re all right. And all of those legs are serrated. Do you think flies pick up more or less poo than my hair did more. Do you ever see flies on your food. Yeah. Then do you throw out the food after you see the flies there. Not usually then what are you eating and that’s the moment that Kemal car calls the ignition moment at that moment.
: [00:23:52] The truth is really inescapable. And at that point Dr. Carr describes that discussion tends to spiral out of the facilitators control. People are agitated by this and they start saying you know we we can’t continue this this is crazy this is madness. We’ve got to stop this. And they often ask the facilitator what they should do. But the facilitator won’t answer. He says you know you know your village better than I do. You’re free to choose anything you want including continuing to do what you’re doing today. And so that’s the trigger that’s the spark for the behavior change that’s responsible for this behavior. And Dr. Carr admits this is a brutal process. I mean this is very very uncomfortable but it is also effective and their experience like in Bangladesh where this methodology CLTV became a cornerstone of the work the rate of open defecation declined from 34 percent to one percent.
: [00:24:46] And I think to me this is just a crazy moving powerful emotional story. If I could sort of zoom out for a minute and talk about well what does this have to do with the rest of us. I think what’s distinctive about this story is that all the villagers already had all the information that they needed to come to the same conclusion. There is no news being added by this facilitator.
: [00:25:08] They already know where they poop. They already know that flies you know flit between the poop and the food there there’s no news.
: [00:25:16] But the way that this was set up it caused them to as we say in the book trip over the truth and to trip over the truth is to experience an insight that packs an emotional wallop. It’s like when you have a sudden realization that you didn’t see coming and one that you know viscerally is right that’s when you tripped over the truth. And in the book we go on to explain how as communicators we can use the same strategy to get our audiences to kind of have those visceral moments of realization.
: [00:25:49] Wow what a great story and it really goes back to the title of the book The Power moments. This is not just about your money and business. This is about how to change your behavior how to change your life through the power of a moment.
: [00:26:05] It’s life changing. It reminds me of some research that was done by a psychologist named Roy Baumeister who studied people who have these sort of sudden realizations. You know people who join cults and later leave the more alcoholics who become sober or you know intellectuals who were once communist and then recanted communism and he said that in these situations these realizations were often characterized by what he called a crystallization of discontent which was you know one moment kind of one of those lightning bold moments when an array of misgivings or complaints suddenly became linked in a global patterns. Imagine just in your mind just a hundred scraps of cloth that are laying there and then in an instant they’re all knitted together and you can see the whole suddenly you know you might imagine a husband who has a really bad temper and he has a ferocious outburst one day and his wife suddenly realizes that these outbursts aren’t just him having bad days they’re actually a defining character trait. And in that instance she realizes not only the truth about her husband but also the fact that she can’t bear it anymore. That’s the crystallization of discontent and that’s what we saw in the seal tās story right that in an instant. All those fragments of truth that were already there were suddenly stitched together because of what this facilitator did.
: [00:27:28] Let me ask you this. Dan so going back to your original discussion about the mortgage in when you were acting as a consultant you guys were able to identify something that was really obvious to you but for everyone else in that community was completely oblivious they just never saw it that way.
: [00:27:45] How does a person listening to this conversation go about seeing those kind of things.
: [00:27:51] Now if I’m an executive of company X and I’m hearing this conversation I’m thinking how can I construct the moment for my employees or how do I do with this so how do I go about like what’s the methodology for trying to discover that moment or that opportunity for a moment.
: [00:28:06] How do you think through that. Yeah great question and I think that even though these stories are a bit dramatic you know the poop story and cold members and so forth. There’s a very practical lesson here so I’ll give you a concrete business example. So a guy named Scott Guthrie who’s one of the top execs at Microsoft about six or seven years ago he was tapped by Steve Ballmer he was the CEO at that time to lead their cloud computing service called Azure. And so Guthrie hadn’t been in azure and so getting to know the new unit he started with some visits of customer sites he wanted to hear customer feedback. How are things going. And his visits tended to be pretty consistent he found he realized that customers appreciated the technology they thought it was a good feature set but it wasn’t very customer friendly. And so if you kind of freeze there here’s a guy who has an insight. He knows that in order for Azure to deliver on its potential it’s got to become more customer friendly questions How do you communicate that. Is there a way to get people to trip over the truth. Well here’s what he did. He called an offsite meeting with his new team invited all the senior managers and software architects when they got to the off site he gave them a challenge build an app using Azure just like one of their customers might have to do. And it wasn’t designed to be a difficult challenge. You know this was not like a development Everest. He was asking them to climb but when he found that the team really struggled some couldn’t figure out how to use certain features.
: [00:29:39] At least one team couldn’t even figure out how to sign up. And Guthrie later told a reporter it was a complete disaster. But of course that was the point right. That was the moment getting them to trip over the truth. They had to see this for themselves. And once they had they had that emotional willingness to change. And by the end of the second day of the offsite they’d produced a plan to completely rebuild the platform. So if you kind of reverse engineer all these stories that we’ve talked about what you find as is a three part recipe you find a clear insight. You know I know Azure isn’t customer friendly enough. It’s compressed and time. Right. There’s something that can be condensed down to a moment the moment when you realize hey we’ve been eating each other’s poop in that village for the moment at the offsite. When they realize hey I can even sign into my own software package. And then the third part of that recipe is that it’s discovered by the audience itself and that’s probably the most important part of the recipe is that the aha moment happens in their heads not yours and that you didn’t just attempt to take an aha moment that you’d had you know condensed into a PowerPoint or an Excel document and shove it across the table. And so I think that’s the lesson for communicators is can you create a situation where your audience can have the same epiphany that you had. Can you replicate not just the actual information but the actual discovery of it.
: [00:31:05] You know there was a couple moments in your book that reminded me of Tony Shea and a book that he wrote called Delivering Happiness where you’re talking about the difference between lasting happiness and short term happiness. Talk to us about the research that you did on this because I find this such an important point for people regardless of the investing or the business side of things. I think just in general to become a happier person in life this is so important. Tell us what you uncovered.
: [00:31:32] Well I’ll tell you about something from the discipline of positive psychology which your listeners probably know as part of psychology this devoted to studying what makes people happier. And there is what I would consider maybe a greatest hit of positive psychology that’s called a gratitude visit and the gratitude visit is a very simple idea. I’ll share with you the way that Martin Seligman who is considered the godfather of positive psychology. Here’s how he describes it. Close your eyes call up the face of someone that’s still alive who years ago did something or said something that changed your life for the better. Someone who you never properly thanked someone who you could meet face to face within the next month. You have a face in mind so your task is to write a letter of gratitude to that person and deliver it in person. The letters should be concrete to maybe 300 words ish. Be specific about what he or she did for you and how it affected your life. Let that person know what you’re doing now and mention how often you remember what they did or said for you. And this sounds really simple right. It’s just kind of a labyrinth thank you for someone who has been important in your life. It might be a mentor and maybe a colleague it might be a relative.
: [00:32:46] Might be an old teacher but what they found is the people who conduct a gratitude visit see their happiness levels spike for a full month afterwards a month. I mean back to your point about short term versus long term happiness. We can all think of a lot of things that will spike our happiness levels for 5 minutes or an hour. You know I would go directly to the nearest Krispy Kreme for that 5 minute rush. You know I mean that’s a sure thing. And so here’s an example of a moment that every single person listening to this can create and probably should create because we all have a lot of people that deserve our gratitude. It’s not easy. I mean it it’s hard to force yourself to sit down and articulate something like this it’s personal. It can make you feel vulnerable or uncomfortable but I’ll tell you what I mean. There is not a person alive who’s ever done this that regrets it. It is such a powerful thing not only for you. Let’s keep in mind even though it spikes your happiness levels imagine how it feels for the other person to receive a compliment like that. Absolutely.
: [00:33:50] They were good friends with Jesse Itzler here at the investors podcast we’ve had them on our show three times. I ended up doing a simulated climb up Mt. Everest with him earlier this year. Yes it was insane. And Jesse is just a great guy. And whenever I was out at the Everest event I got a chance to meet his wife Sara Blakely. And you talk about Sarah in your book and I love this story that you tell about Sarah and I would really like it if you could share some of these insights with our audience of Sarah’s story and most importantly tell our audience about Sarah’s dad.
: [00:34:25] Yeah I love this story because you know one of my worst fears about this book is you know we tell some stories like popsicle hotline that are sort of fun and clever. And my fear is that parents are going to read this and think that they’ve got to do a bunch of like cutesy stuff like not only every birthday has to have a bounce house or something you know that it’s about these grandiose and it’s really not about that. And I think this Blakely’s story illustrates that. So first some backstory I have to admit when I first started researching this I knew of Spanx but I didn’t really know what Spanx were and so maybe there are other people out there and in my boat I’ll just share some some basics. So there’s a famous story about when Blakely kind of discovered the idea for Spanx as she was getting dressed for a party. She had a new pair of fitted white pants she wanted to wear but she had a dilemma. She wanted to wear her pantyhose underneath her pants because they have kind of a slimming effect. But she also wanted to wear sandals and for sandals you need bare feet you know her bare feet with pantyhose. So what should she do. She should wear the hose or not. And so she has this inspiration. This is a moment of insight. She cut off the feet of her hose so she can have the best of both worlds. But it wasn’t that great of an innovation because you know the severed ends of that hose kept kind of rolling up her legs in an uncomfortable way.
: [00:35:45] But she thought hey if we could do this right we could create a real version of this. Women are going to love this. So you know fast forward to 12 years later she had become the youngest self-made female billionaire in history. And so people come up to her these days and they say you know I was cutting the feet out of my hose years before you thought of it how come I’m not the billionaire. And to me this is the real part of the story that separates Sarah Blakely from the others because as most of the listeners will know I mean both investors and executives. The idea is often a vanishingly small part of the success. So thousands of women probably had this idea but there’s only one Sara Blakely. Why did she succeed. Well let me tell you about the kind of gauntlet of failure that she had to run in order to make this idea come to life. So first of all virtually everyone that she needed to recruit to her side was male and virtually none of them understood anything about this. In fact at one point she was trying to find some IP lawyers and she met with this one law firm. So picture them around the table. Basically all men and Sara Blakely. And she noticed one of the lawyers kept looking around the room like a little bit suspiciously and that’s just strange and then much later the lawyer confessed to her that in that meeting he thought her idea was so bad that he thought she was sent with like a candid camera crew or something.
: [00:37:12] And so he was trying to find the camera in the room the textile mills that she needed to crank out a prototype of Spanx were all I mean look all managed are owned by men and none of them understood what she was trying to do. It was only when one mill owner shared the idea with his daughters who told them Hey call this woman back. What’s a good idea. She finally had a chance to get the prototype made. So the real question is not where did this idea come from the real question is how did she survive just getting door after door after door slammed in her face. And so there are two answers to this. The initial answer is Sara Blakely before founding Spanx had spent years I mean years selling fax machines hold. Talk about a hard degree of difficulty. When she started her job as a fax machine salesperson her boss handed her a phone book that was her lead set and gave her a zip code. As trve and she had to go door to door selling fax machines as anyone listening to this podcast bought a fax machine from a northern or salesperson as Sara Blakely. But even if we go one step further when we say well how did she have enough grit to survive that gauntlet of fax machine selling she says. One important thing happened in her childhood she said when her family would have dinner her dad would always ask her and her siblings a question at the dinner table and his question was When did you guys fail at this week.
: [00:38:41] When did you guys feel a lot this week and Sara Blakely said if we had nothing to tell him he’d be disappointed. It seems counterintuitive right that he’s encouraging them to fail. But she said he knew that many people become paralyzed because they’re afraid they’re going to fail. They’re afraid of what others are going to think.
: [00:38:59] And so they create this very safe riskless life. But she said my father wanted us to try everything and feel free to push the envelope and his attitude toward me. This is her talking. His attitude taught me to define failure as not trying something I want to do instead of not achieving the right outcome. And so back to the point of the book this is an example of how even in a moment a question at the dinner table as a parent you can have an effect on your child that you may not even realize you’re having. I mean that’s that’s how powerful a moment can be.
: [00:39:31] I really like that story. And almost all of that a real life from your book is your story about how shallow good your life like a computer game where you can still level up and we just think something that you can just use for your business but also in your personal life in terms of achieving your next goal.
: [00:39:50] Could you please tell that story.
: [00:39:52] Yeah I think this is a really subtle but really practical idea and it involves. We talked earlier about moments of pride and so our quest here is for the things that we want in life. Can we come up with a way to ensure that there are enough moments of pride along the journey that it keeps us on the journey. So let me explain what I mean a lot of people listening especially if they’re Americans and you know were raised with one language you know may dream of learning a second language. I know I’ve always thought about. I’d love to learn Spanish someday. And so if you think about how most people conceptualize that mission in their minds. Number one I would point out it’s not at all clear what the moment of celebration is. I think it’s Jim Collins that talks about the champagne test like when do you crack the champagne. Well it is very amorphous and this get Windu you know Spanish. So we’re running a race without a clear finish line. But worse than that. What are the finish lines in route to that master goal. So I think the way most of us think about it is in order to know Spanish well I’m going to have to try to squeeze in a Spanish study session and then I have to squeeze in another Spanish study session and then I’ll do some homework and then I’ll do some practice. And it’s kind of like the way we’re thinking about it is you take your medicine you take your medicine you take your medicine you take your medicine you take your medicine and then some day you quote unquote know Spanish.
: [00:41:16] And so when you conceptualize a mission that way it’s no surprise that the vast majority of us fail. We don’t get there. And so Chip and I had come across a book from a guy named Steve Kam K and be called level up your life and he’s got what I consider an antidote to that. He talks about being inspired by the structure of video games which you know if you’ve ever gotten addicted to a video game in your life I’m of the kind of Pac Man and Donkey Kong era but I love the hell out of those games. And you know it’s just level after level each one slightly harder than the previous one. But this is the important part. Every level is fun. So I never finished Donkey Kong. Never. But I still had fun. And I don’t regret the time I invested in it which is very different from a lot of the things we conceptualize for ourselves. So anyway back to the book Steve Cam wanted to learn to play the violin that was his learning Spanish kind of mission. And so rather than fall into the trap of just thinking about it as got to do a lesson got to do a lesson got to do a lesson someday I’ll be able to play the violin.
: [00:42:18] He created these videogame inspired levels for himself. So level 1 was committing to one violin lesson per week for six months so that was kind of like the boot camp. And that was not a lot of fun to be honest. But the rest of these are much better. So level 2 is to complete Celtic fiddle tunes a book by Craig Duncan. Level 3 is learning to play concerning habits from the Fellowship of the ring. Level 4 is to sit and play the fiddle for 30 minutes with other musicians. Level 5 is to learn to play the province Auri from the last of the Mohicans and the kind of in battle the moment of popping the champagne is to sit and play the fiddle for 30 minutes in a pub in Ireland and it isn’t that great because you see what he’s doing there. Number one he’s clarifying what’s the end and the end is that vision of himself in a pub in Ireland what a great fantasy like that’s something that will keep you sustained for a long time. But even more than that what he’s done is he’s created a succession of intermediate finish lines. Each one of which is fun and satisfying on its own merits so learning to play the song Concerning Hobbits from the Fellowship of the ring which is a movie he just adored. That’s something he can get to much much quicker than that in fantasy but it provides a moment of pride in and of itself.
: [00:43:36] And so you know back to Spanish we would be much wiser not to think of it as a succession of kind of boring lessons that we have to endure. But in terms of levels no level 1 B can I order a meal in Spanish with proper pronunciation. That’s something you can do in two weeks. Level 2 might be you know have a simple conversation. You know how is your day. Where are you from. In Spanish with the taxi driver who speak Spanish. Level 3 is glance at a Spanish newspaper and find one headline in the newspaper that you can understand. Level 4 might be to follow the story in a Spanish cartoon. Level 5 might be read a kindergarten level book in Spanish and so you see how dramatically that reshapes the mission. It’s like every one of those levels is cool. Every one of those levels comes with the moment when you feel like okay I’ve done something and then finally every one of those levels is such that even if you quit after that level you still feel like you’ve accomplished something and that’s the Donkey Kong Story right. It’s like if you conquer seven out of 100 levels you still feel good about conquering seven levels and there are so many aspects of our life that I think this strategy would apply to that would keep us experiencing moments of pride and continuing onto the next finish line.
: [00:44:56] You know it’s funny we were talking with Jesse Itzler who I mentioned earlier on the show and we made the comment that you got to be passionate about something that you’re doing and Jesse interrupted me and he says no you don’t want to be passionate about the thing you’re the end state. You need to be passionate about the journey when you’re talking about. And it was really a profile moment for me because I was like wow that was pretty profound and that makes a lot of sense and when you’re talking about these levels and basically creating that journey and when you think about how you play a videogame when you play the video game you’re not like super excited because you finished that last level you were having fun along the entire journey. Every one of those levels and if you don’t treat your life like that I think a lot of people are going to absolutely like you said just quit. They’re not enjoying the process or the journey they’re thinking too far to the end state and getting everything else in between.
: [00:45:46] Exactly right. And I think what’s important for us to realize is that we have some control over this that we can be shaping the journey. Now it’s like we talk about in the book there’s a there’s a kind of architecture of pride and if we understand that architecture we can create our own journeys. Like I have a friend who is a history buff and learning about history is another one of those things that could be very amorphous. When will you quote unquote know history will never in a certain sense. And so what he did was he turned his interest in history into a quest and the quest was that he’s going to read the biography of every American president starting with George Washington all the way up to Donald Trump in order. And so it became like this you know back to that mental image of multiple finish line rather than one. Now he’s got forty five finish lines. And every time he finishes a biography he goes and he buys the presidential coin with that president which is like a nice kind of visual or souvenir from the experience. And then he goes onto the next ones and sometimes the quest is fun and easy like when you read about George Washington. Sometimes it can be incredibly painful. I think it was Millard Fillmore that he said he barely survived the process of reading that book. But that’s what a quest is like. Right. Sometimes it’s easy and sometimes it’s hard. But the point is that we can bring structure the quest that keeps us on the road.
: [00:47:07] All right. So Dan thank you. This was just fabulous. Your book was incredible and I’ll tell you we read a lot of books and I really mean that your book was incredible. The name of the book is The Power of moments.
: [00:47:19] Dan if people want to learn more about you work can they find you they can find us at Heath brothers Dom that’s Heath H. Yea th and all of our books are there. We’ve got a book about communication a book about change called switch in a book about decision making that might be a particular interest to the investing crowd. That book is called decisive absolutely amazing.
: [00:47:41] Thank you for coming on the show today.
: [00:47:44] Thanks a million it’s been fun.
: [00:47:46] All right. So this is the point in the show where we play a question from the audience and this question comes from Elazar guys.
: [00:47:53] I hear you guys talk a lot about it Clinton crypto currencies and the thing you never understand about these crypto currencies is where is the fundamental value. I understand you guys talk a lot about stocks and equities with a fundamental value approach in evaluating companies in terms of what’s the return you expect based on good businesses and they hear a lot of jargon being thrown around about how quickly it’s being accepted and certain thresholds regarding that. But the thing I just don’t understand them a bit coin is that I don’t really see any intrinsic value as opposed to other currencies for example which are backed by basically IOUs by the government which are valuable intrinsically because if anyone Voda IO you would hold that piece of paper as intrinsic value relative to the reliability of the credit. The first issue that I owe you resemble the U.S. government is pretty good. But these bitcoins. What’s stopping people from suddenly deciding you know what we are not interested in them anymore. And then just selling them and not really having any interest in it anymore so really that’s my question. In essence I don’t know anything and where the fundamental value in crypto currencies are.
: [00:49:07] Thanks so I really like this question and I think this is a question that most people out there I would argue 90 percent of the general public at a minimum would probably agree with your position and not understand how this has any intrinsic value. Because all at the end of the day it’s just a bunch of ones and zeros that are distributed across all these different servers around the world. And so how does that have any value. And so this is how I would explain it to you and why I think that there is fundamental value here. So when you look at the way fiat currencies work the day what’s the fundamental value of a currency. Well it’s backed by the government. The government ensures the fact that the FDIC here in the United States if some emergency happens you need your money in the bank they’ll back up. I think what does it thousand dollars at this point. So what are they backing that up with they’re backing it up with more printing. So what they’re really saying by having an FDIC insured is that if all the credit contracts and I think we’ve got to have a conversation about what money is whenever we get into this. So real quickly money is really two things. You’ve got a monetary baseline which is an actual unit which is just ones and zeros that the Fed eats. They have a monetary base line from that monetary baseline. You also have credit that’s created on top of that. It’s a fractional reserve banking that’s created on top of that most of the money that dollars in the system is credit. And so that’s why we have these big credit cycles that expanding contract because most of its credit and that credit can dry up and it can expand and then it can dry up and it can expand.
: [00:50:48] When you’re talking about crypto currencies it’s just monetary base. There’s no expanding and contracting of the credit with it. What’s that backed by. Well it’s backed by the people that believe that the protocol will not be updated and that there are incentives in place. It’s the ultimate game theory that people say that will keep the protocol in check because the people that will hold the majority of the coins aren’t going to want them to be increased with a monetary baseline to be increased. So if you buy into that then there’s an intrinsic value in the fact that the monetary piece can’t be manipulated. But history has proven that fiat currencies that are backed by nothing. Always have always been manipulated by their monetary base line it has been increased. We’ve seen that with the dollar you can pull up any chart of the dollar for the last 100 years and you can see that the dollar is devaluing and devaluing it somewhat of a rapid pace. And so that’s what it really comes down to is do enough people globally have faith in a mathematical solution. Block Chain technology on bitcoin the protocol will not be adjusted. You got a lot of people working the protocol and trying to mimic the protocol but as long as you have a network effect and more and more people continue to join that network the protocol will not adjust monetary baseline. So you have to have faith you have to believe in that being a better store of a unit of measure than government doing.
: [00:52:24] My personal opinion is as I kind of buy into it a little bit now we’re not talking price right now because the price is going in wild swings because it’s brand new. There’s people that are adopting it there’s people that are trying to short sell it. There’s all sorts of things that are happening. But if you asked me if I would be surprised in 10 years from now if bitcoin was a global currency that a lot of people were using that would not surprise me in the least bit. I would not be surprised at all. That was what happened in 10 years from now. So this is the quote that I’ll take from rate value. And this isn’t exactly word for word but it goes something like this. Don’t think about how you want the world to be. Try to understand what the world is and how it does function. And so whenever I think about how this might play out whether you want Bitcoin to work or you don’t want it to work or you want the currencies to remain dominant backed by a government whatever you have to take your opinions out of it. Yet to think what is going to actually happen here. For me right now it kind of seems like this whole movement is going to become real and I think there’s going to be a lot of bumps along the way. And I mean a lot of bumps and big bumps going up and going down. But I wouldn’t be the least bit surprised to see it really come to fruition based on the network effects that we’re seeing on the protocol today.
: [00:53:43] You know it’s such an interesting argument that on one side you might say that it doesn’t have any value because it’s not like other men. And then the other side says it has value because it’s not like other men. Ms.
: [00:53:58] Yes kind of the running. And the more you think about it and the more that you study thing in economic history there is a lot more to it. And let me just give you a few examples. So in Russia for instance in 1992. So this was the first year after the economic reform retail prices in Russia increased by two thousand five hundred and twenty two percent. So think about that think about that today where we are looking back at 1980 in this space and saying well you know inflation was 13 14 percent. Like we don’t want that to happen. No we don’t want inflation like that to happen but we definitely don’t want Russia to repeat itself. Two thousand five hundred twenty percent inflation in one year. And this is not just ancient history if we look at what’s happening in Venezuela right now. So just the first nine months of 2017 they have more than 500 percent inflation. So basically what I’m trying to say here is that while we in developed countries are talking about you know it’s all tile we believe and the staff will assess them while we probably have a good reason to do that. And the problem makes a lot of sense for people call the top 1 billion people in the world not to buy bitcoin because by you you can 24 hours you can have access to bank account you can get credit. You can trade international markets. It makes not a lot of sense but if you’re one of those 6 billion other people or whatnot it probably makes sense. I think it’s around 3 billion. There are completely unbanked. And then there is another 3 billion that can get access to bank accounts just very very difficult and it doesn’t have as much Teleni perhaps for them.
: [00:55:47] It makes a lot of sense because they’re not necessarily afraid of going back to 1980 scenario with 10 percent inflation that might afraid of 500 percent inflation in one month or even more. And the thing that really also goes back to what is the intrinsic value of something like bitcoin and whether it’s Bitcoin or another cryptocurrency a really thing that stores of value is just so valuable. And that’s probably the highest utility that you can think of. I mean often big companies compared to gold is typically called the digital gold and if bitcoin were to be priced at the same level as gold it will be of around 500000 U.S. dollars or one coin. Now I’m not saying that this is what it should be. You know you might have good arguments why should be 10 percent of that are 5 percent of that or wherever it is. But a lot of the arguments that you have about something like crypto currencies that you can spend that in stores. I mean you can’t spend gold. Most places but you can find multiple places where you can Kashdan and that’s also what you see for instance. And if you think about gold you know. Yes there is some utility to gold but it’s actually very little if you really think about it. It really comes a lot from the trust. You can always find valuing in gold. So I think for me if I were to invest in bitcoin I think the stores of value is the most important thing.
: [00:57:19] You know it’s quite a transition because we’ve never seen anything like this ever before. We’ve never seen anything that was a distributed network that was a store of value. That’s never happened. This whole block chain thing is brand new. I mean it’s never happened before and I think that that’s going to take a lot of time. If this does go all the way and this really does become a global currency that’s going to take a lot of time to convince the general public that that’s something that’s safe and something that they actually want to possess. And I don’t think that that’s something that you can just sit down and have a casual conversation with anybody because you really you’ve got to understand a lot of things. Number one you got to understand game theory.
: [00:58:01] I mean this is all wrapped around game theory and the way that the currents work. You’ve got to understand monetary policy you’ve got to understand what’s happening with these central banks and that they’re in a race that devalue their currency so that they can manufacture growth inside their own country. You’ve got to understand branding and marketing and how powerful that is to sway opinion and build trust. There are so many factors that are wrapped into this that that’s not going to happen quickly. It’s going to take time. If this does go all the way and I think that that’s really important for people to keep an open mind about it. And if you don’t buy into it you might be smarter than us. But I think that it’s important that you keep an open mind and that things continue to move this way and although it doesn’t seem like there’s any intrinsic value I can tell you one thing if there’s ten trillion dollars of value pumped into this thing as far as the market cap goes guess what. There’s value there. You can take a bitcoin at that price and you can go buy a Ferrari with that and that Ferrari’s real like. I don’t care what anyone says there’s no intrinsic intrinsic value there if you have that many people on the network using this stuff. And that’s important that’s really important for people to not rule it out because maybe they don’t understand some of those nuances and maybe they do understand there’s nuances. Completely disagree with the fact that it’s going to go in that direction. So amazing question and I think that it’s something that a lot of people were thinking about.
: [00:59:24] I wanted to bring an argument the table and really a counter argument. And whenever I say a counter argument it might sound like know rest and I are super bowl and be kind and I don’t know if you are like if anything we see yourself more as you know media that you know a lot of people are talking about. So we’re talking about because if we really try to understand that if a lot of people are talking about bonce we would talk a lot more about bonce. So I really just want to point out that I’m not saying to buy or sell or are saying is it good or bad idea. We want to try to tukar from that angle. I would like to bring in and to the table that Raul Paul who we had on several times on the podcast is because he’s not necessarily on bitcoin per se but he’s definitely there on the price. He’s saying that the price would dramatically go down next year. And basically what he’s said was it reminded him of Cisco. So back in the days where the Internet was all the rage and people were buying you know clicks and banners and all that.
: [01:00:31] RHC valuations what happened back then was that since Cisco provide a lot of the infrastructure to the internet it was like if you were really bull on the Internet and you didn’t know if you should invest in Microsoft or some of the millions of other companies that were not Microsoft the easy way was just to invest Cisco because no one really knew where the Internet was about. He argues there is a parallel with what’s happening today with if you are a bull on a block chain I think most people will agree that there is so much potential in the technology of block chain then you can more or less see bitcoin as an application like gmail. You know if G.M. were to go down. Nothing would happen to the Internet and saying that you know this is more or less a spinoff. It’s something that is now available. It costs a block chain but it’s not necessarily something that would go up in price because Lutchman would become more popular. I really liked that argument. I think it’s a very insightful argument and it really made me think of everything that could go wrong I guess.
: [01:01:40] Well I got another one that I think could go wrong. So when you’re talking about the most superior protocol to do store of value when you’re talking block chain specifically and you’re talking about the way bitcoin works you’ve got to have this mining mechanism in place. You’ve got to expend a lot of energy in order to secure that network. What happens if another protocol comes along that does that much more efficient that basically performs the same function that you’re able to transact a digital file or a digital unit of measure to another person. That’s not copyable but you’re able to do it at a much lower expense from a mining and energy and all that kind of and that would be a whole nother discovery like lock chain technology was a discovery. There’s a thing out there called Internet of Things that’s using a thing called a tangle which picks no mining whatsoever. Now I don’t know that much about this but that’s a threat that is an absolute threat to the protocol. That is a different protocol that could initially be implemented and it could take all the market share and for people that maybe are so wrapped up in the bitcoin specifically or any one of these other protocols like 3M or whatever if you’re so wrapped up in so headstrong that that’s going to go all the way I think you’re potentially have a major gap in your understanding of how to assess risk to something.
: [01:03:04] And so I think people need to really be on the lookout for other ideas. And I think that the whole network effect is definitely a very powerful force behind all of this it’s very hard to overcome a network effect as strong as bitcoin but that doesn’t mean it can’t be done. So I think people need to be very cognitive of all the things that could potentially go wrong because that list is somewhat unknowable. And I think you’ve got to be on your toes. So we’re very big fans of this but I think we’re big fans because we’re excited about the change in the finance sector in general and how this could all change like to be honest with you since the last recession. I’ve been thinking to myself How in the world do these central banks get out of this. How does this all end. Do we keep printing into the negative territory and giving the bank a 100 dollars and getting back 95 year later. Like how does this end.
: [01:04:00] And to be honest with you seeing some of this Kryptos stuff is getting me excited because maybe that’s how this starts shaking. I don’t know. But it’s a potential solution. It’s something that could actually start making interest rates go back up. If it starts getting mass adoption that’s exciting. That kind of stuff’s very exciting and that’s why we really like talking about learning more.
: [01:04:22] So go back to a question. So we used to talk about if we should compare bitcoin to gold say we have the same market cap and with the available coins that’s in the system right now would be around five hundred thousand dollars. Also try to make another comparison and that would be to talk about the trends action fees. And it’s not so then when you do transaction with bitcoin everything is completely free but is significantly cheaper. And if we think about what is the amount of the total transactions fees. Right now it’s around 300 billion dollars every year. And I tried to take these as gross margin and that’s around 8 percent. I said that if you had a company trading it of 20 and then this specific big company you want to call it would have 20 percent market share. And if we do that we come up with a price for kind of around 60000 dollars. Then I try to look at what if the utility of the true utilities was remittance and you have around 600 billion a year carry about 200 million people and you yeah put in again some Akrotiri and you might agree or disagree and you can treat yourself but say that the savings some transaction costs would be around 10 percent.
: [01:05:42] So Western Union charge 9 percent just like that but say that the combined transaction costs would be 10 percent Guen trading at around 18 percent and say that Bitcoin could handle 20 percent of this market. Then you have a price per kind in round fifteen thousand dollars. I think that the problem that big calling is really trying to solve that is store of value. Now again not the same as saying that it’s worth expected the same as gold because it’s try and solve the same thing. But I do think that has more validity if you think it’s transaction costs and you think because it’s better because it’s Savir. You’re not a big believer in some of the other crypto currencies that might solve this problems like better or are you disagreeing a thing this is the question of remittances rather being the hostility than you might want include with that instead in your intrinsic value we’ll also like to take that opportunity to talk about a new tool that pressing created that’s really valued and the price action of Bitcoin.
: [01:06:44] So please go ahead trace Mayer is a guy that I really respect in this space he’s extremely smart. He’s been playing in crypto since specifically bitcoin since like 2011. He has a very large net worth because he’s been playing in this stuff for so long. Well in excess of 100 million dollars and so the way trace some of the stuff that I’ve read from trace when he’s looking at price and trying to understand if it’s a good time to buy or simply hold he was looking at a multiple of the price that it’s currently trading at today or the price that it’s at today compared to the 200 day moving average and so he put out some numbers on some different blog posts that he did comparing the price to the 200 day moving average. And I found it quite interesting. So when he put the price out there he only compared it a couple times in history. You know he had like maybe eight different times or the multiple was a 10 and the multiple was a 3. And he’s showing those price points and then he said you know based on the 200 day moving average this is where the price would be if the multiple was a 5 7 or whatever.
: [01:07:48] Well I looked at the data and I said Well you know five or eight data points or whatever. Clearly aren’t enough to really kind of understand where this goes so that charted out and look at the statistics on it. So I did a statistical analysis of the price over the 200 day moving average for every single day since Bitcoin was originally started. And what I found was some really interesting results and what I did as I bought the domain Mayer malt Welkom and we named it after trace because traces last name as mayor. So it’s Mayor multiple dotcom and I basically published all the statistical analysis that I did on this multiple and it was really fascinating stuff and something that I found that was really interesting is right now in December of 2017 the multiple is really high way higher than it normally is so this multiple is typically around a 1.0 or so if the 200 day moving averages 1000 then the price would be 4300 is what is the average Robic point is about a one point four today. In fact just a couple days ago it hit a 5 or like a 4.5.
: [01:09:02] So if the 200 day moving average was 1000 the price was like 5000. It was really high. And this is very uncharacteristic in fact this is only happened two other times in the history of Bitcoin. And every time this has happened the price has come back down to about a one point four within like 15 or 30 days it’s really fast. So based on the stats that I’m looking at the price has only been this high like 3 percent of the time it’s been this high and my expectation is that the price is going to come down significantly in the weeks ahead based on the statistics that we’ve done but houen UVs that’s based on the past and we’ve got to look towards the future. We have no idea what that future means. So based on historical results we’d say that the price is very high and that it’s expected to come down but who knows we might be in a different environment with derivatives and everything else. We don’t know that but if you guys want to check out the statistics that I did on this it’s really interesting stuff. It’s a major multiple dot com. Check it out.
: [01:10:03] Yeah. And as people can tell you press and I we’re pretty excited about Ernst so on multiple ICOM we actually we started to compile all the various resources that we can find the kind that might think is useful to you at least has been useful to us and our journey to really understand this so we like to use this resource not just for us but really shared with the community. So together we can help understand this so we just wanted to put that out there that as we go along there will be podcasts in there about crypto occurrences videos and a few other resources.
: [01:10:39] Yeah and if you guys are listening to this and you know of a good resource send it to us on Twitter or send it to us on e-mail it to us so we can add it into the index so people can learn. Like for example there was a like 70 year 65 video lesson from Princeton University completely free that’s listed on this resource that I’ve taken and I loved it. It was amazing. I can’t believe it was free. We want to add these things into the resources so we can all help each other right to understand what the heck is going on.
: [01:11:11] Elazar thank you for this question. I don’t even know if we gave you a decent answer. I think our answer is we don’t know. But there is a lot of interesting things out there that we’ve got to be aware of and be remain vigilant. So thank you for going to ask the investors dot com or anyone else out there if you want to get a question played on the show go to ask the investors dot com you can get your question played on the show. And for Al-Azhar we’re going to give you a free subscription to our intrinsic value. Or is there going I made it’s 18 lessons long it’s on the VIP Academy page on our website. And we just want to give that to you to say thanks for recording the question and being an active member in our community we really appreciate that.
: [01:11:48] All right guys that was all oppressed I had this week’s episode of the investors podcast Seitel again next week.
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