How to Get Rich in American History
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What historical investing principles are still relevant today?
So from the George Washington administration until Michael Jackson's Thriller album, dividends were 90 something percent of returns and price movement was very little of a gain. And since then, I think well over 70% of our investment returns come not from dividends, but from price elevation.
That was historian, investor, and author Joseph Moore discussing his new book, How to Get Rich in American History, 300 years of financial advice that worked and didn't. I'm Motley Fool producer Matt Greer. My colleague Rich Lumello recently talked with Moore about all of that financial advice and about some timeless lessons for today's investor. Enjoy.
Welcome to Motley Fool Conversations. I am Motley Fool contributor, Rich Lamella. Our guest today is someone who brings a rare combination of perspectives to the world of investing. Dr. Joseph Moore is an author, historian, and investor who didn't start out believing in the American dream,
How did Joseph Moore's background influence his investment philosophy?
But through his own experience in the markets, he's come to see it as not only real, but also achievable. In our conversation today, we're going to explore the strategies, decisions, and lessons behind his investing success, including some surprising approaches that paid off and others that didn't. We'll also dig into what history can teach us about markets today and how everyday investors can apply those insights in a practical way. Dr. Moore, welcome to The Motley Fool. I'm so glad to be here. Thank you, Rich. Great. Well, you have just published a book called How to Get Rich in American History, 300 Years of Advice That Worked and Didn't. And so I look forward to kind of jumping into the thoughts around that and kind of pull out some anecdotes and some investing wisdom for our Fool investors.
But before we do that, why don't you just give us a couple of minutes of kind of your background?
What lessons can modern investors learn from Teddy Roosevelt's cattle farm disaster?
Yeah, thank you. So I was getting a PhD in American history. I came from a very rural, working-class family in the South, right? My mother was brought home to a house with no flush toilet, and she was the sixth child, right? So on my father's side, they were active resistors to capitalism, as it were. These were mill strikers who had—the Communist Party had sent activists down South to teach people, you know, dumb rednecks to read the Communist Manifesto. Those rednecks were micro— my great grandparents and they like, you know, charge the mills and these kinds of things. So like my dad growing up would vote communist for president. So I did not enter through the door of believing in capitalism.
How does Airbnbing rooms relate to historical investment strategies?
And so I was getting a PhD in history and I did all the same things that all that you hear professors do. I assigned Karl Marx on day one, all the, you know, but not Adam Smith. But for some reason at that time, it was 2005, someone said, well, the lesson of history is clear. You need to buy a house. And instead of thinking about that for a hot second, I just nodded my head. We bought a house. We're graduate students, right? I mean, this is the no verification loan world. Then a friend of ours was going to lead a financial class at the local church. He was like, would you come?
What surprising strategies did Joseph Moore discover while investing?
I said, absolutely not. I'm smart. I don't need this stuff. Plus, it's all a scam anyway. And he said, would you just do me a favor? Because I'm scared I'm going to be embarrassed if only like two people show up. So we went to help a friend, and they make us do a budget. We go home, we fill it out, and my wife falls asleep, and I stayed up literally all night. It was like, who gave us a mortgage? We have no money.
Why is the concept of compound interest considered a modern phenomenon?
And so we put our house on the market on, I think, a Friday or Saturday. It sold the next Saturday in a bidding war. Our neighbor put her house on the market the following Saturday. It never sold. We were the last people off the 2008 Titanic. And I was floored and humbled and embarrassed that I thought I knew so much history. And a friend's class in a church basement had taught me more than any book I was reading. And I thought there has to be a history here. And so I set out on a quest to understand, like, what were people told to do with their money?
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Chapters
8 chapters
1
What historical investing principles are still relevant today?
0:02–1:07
2
How did Joseph Moore's background influence his investment philosophy?
1:07–1:56
3
What lessons can modern investors learn from Teddy Roosevelt's cattle farm disaster?
1:56–2:35
4
How does Airbnbing rooms relate to historical investment strategies?
2:35–3:02
5
What surprising strategies did Joseph Moore discover while investing?
3:02–3:24
6
Why is the concept of compound interest considered a modern phenomenon?
3:24–3:53
7
What mistakes should novice investors avoid according to history?
3:53–4:20
8
What resources does Joseph Moore recommend for understanding investments?
4:20–26:10