Global Stock Markets, Side Hustles, Bitcoin's Energy Use and Active vs Index Investing with Damien Talks Money

This week I'm joined by YouTuber Damien Talks Money and we talk through a load of different things, including making a success from YouTube, the state of the global stock markets, staking crypto, bitcoin's energy use and active vs passive investing.

Damien's channel has grown incredibly fast through his unique combination of UK tailored finance content, delivered in a way that is equal parts educational and entertaining.

It was great to have Damien on The Hedge podcast to find out a bit more of what goes into his channel and his thoughts on various money and investing topics.

If you want to get a free copy of the Modern Investing Fundamentals eBook - you can get your copy at thehedge.io

You can find Damiens YouTube Channel here and his Instagram here

If you want to follow me on Instagram you can find me here

If you’d like to read through the transcript from the show, you can find the whole thing below.

Jason Mountford 00:01

Hi guys, my name's Jason Mountford and this is The Hedge podcast where we talk about growing your wealth and living authentically. This week I'm joined by YouTuber Damian Talks Money and as his name kind of suggests, that's a lot of what we discussed today. We talk about loads of things to do with money. We talk about the global stock markets, whether we're headed for a crash, we talk about staking crypto, bitcoins energy use, we talk about the active versus passive debate and a number of other different investing and financial topics. 

And Damien's a really interesting guy, his YouTube channel, Damian Talks Money has grown really, really fast. We talked about that in the episode today as well, he started it not really that long ago, and he's got over 50, or almost 50,000 subscribers. As I as I record this at the moment, so he's, he's growing really fast, he's got a really interesting way of bringing finance content, we're putting finance content out there, he has a really conversational, easy manner about him. And his actual videos on YouTube are really quite entertaining. He likes to throw in a few gags and some kind of funny one liners and that sort of thing, while still bringing a lot of valuable knowledge. 

So it was really good to have Damian on the show to talk through his mindset around creating his content. There's a lot more work that goes into it than what a lot of people probably would expect. And he mentions a number of times that he's not the smartest guy in finance. But I think once you've listened to this episode, you'll realise that he's got a lot of really good knowledge on lots of different investing topics. His take on different things is, he's pretty, he understands the game really, really well. And I think there's some really valuable stuff in this episode for you to take from this conversation with Damian. 

As always, if you want to check out his channel, or find more information from the hedge, you can find everything for me at the hedge.io and the links to Damien's social accounts and his YouTube channel can be found in the show notes. But for now, let's get into the episode. 

Jason Mountford  2:03

So, Damian, thanks very much for coming on the hedge podcast. Really nice to have you on Mike.

Damien Talks Money  2:07  

My pleasure. Thanks for having me.

Jason Mountford  2:09  

Yeah, good stuff. So today, I thought it'd be really good to get you on and just talk through some of the issues that are going on in the investing world in the finance world, there's obviously always news happening with COVID. And with inflation and crypto, it feels like a bit of a crazy time. I mean, I feel like we've been saying that for a couple years now. But everything feels not normal in a lot of ways. What do you think?

Damien Talks Money  2:35  

How long does it feel not normal, before you say this is the normal I guess? But yeah, it feels like especially the last 24 months or longer, anything you expect to happen, I would almost bet the complete opposite is gonna happen. It's kind of how I feel about the markets and life nowadays.

Jason Mountford  2:53  

Yeah. Yeah. How long? How long is not normal before it. I mean, that’s the cliche phrase at the moment isn't it like the new normal? Yeah, I think it really does feel like it, we were speaking just before we jumped on and hit record about, you know, moving house and that sort of stuff. And like a lot of people that I know, are moving really far away from where they're working, from where they've always lived, because that commute and having to be tied to the office. It's not really a thing anymore, is it?

Damien Talks Money  3:20  

No, I mean, it isn't for now, but I know businesses at senior levels. And I know that they spend a lot of money on office space, and they're tied into that for a long time. And from a productivity standpoint, I think that companies will put pressure on people to be back in the office when they can. So I do wonder if people you know, make that migration and then realise, oh, no, actually, there's some downward pressure here from senior people within the business to be in the office because they want you in the office so they can keep tabs on you. You know, that's and that's how a business likes it. 

I do think at the minute, there's so many job offerings that you can really negotiate hard around flexibility on wages and all these points. So I think for now, while it's almost like an employee's market, isn't it in the sense of, you know, you can renegotiate your packages and stuff? I think once that changes, we might see that change.

Jason Mountford  4:10  

Yeah, it will be really interesting to see, we're going to talk a little bit about property investment. We'll touch on that later on. But it's a good point. You know, I know my company. It's all well and good to have everyone working from home but I think they're locked into like a 10 year lease with a 10 year option or something insane. So it's not a cost they can just cut, is it.

Damien Talks Money  4:28  

No. And some of these London offices are very expensive.

Jason Mountford  4:31  

Yeah, big time. And yeah, any major city these days really, but definitely London in particular. 

So look, obviously this is a podcast, you're big on YouTube and don't tend to do as much in the podcasting space. So I tend to find that people are often quite tribal, in a way, about the kind of the the channel where they spend the most time so you either really big into YouTube spend a lot of time on YouTube, or you don't necessarily really watch it at all and your big into podcasting or you spend a lot of time on Instagram or whatever. And so for those people maybe who don't spend a lot of time on YouTube, haven't come across you before, it'd be good to get a bit of an insight  to kind of your background and what made you want to start. Damian Talks Money?

Damien Talks Money  5:16  

Yeah, okay. So, from my perspective, I’m on YouTube, I've grown up with YouTube as an influence to me, so I consume a lot of YouTube content, more, I don't watch TV really, or anything like that. And I think, you know, I like most people, I stumbled across personal finance content. I got into that, and I saw the American boys, you know, Andrei Jikh, Graham Stephens. If you're on the YouTube finance space, you'll know who those guys are that are the biggest in the scene. 

I just thought that I had this burning desire in the back of me for a long while thinking someone could do what they're doing in America in the UK. And there are some people already in the UK doing it, I just felt there was an angle there for an entertainment value. I'm not saying I'm the smartest guy in the room. But I feel that I could liven it up a bit. It was kind of my thought process. And then I was furloughed for four weeks. And I thought, well, now's the time to do that.

Jason Mountford  6:12  

Yeah, awesome. I think that that is definitely for me. When I spent a bit of time on YouTube as well, I think it's definitely where you stand out. There's some great personal finance content on YouTube. But I can see why your channel is growing so fast, because it is very different and very relatable. You know, if for anyone who's not watching Damien's videos, you know, it's very much about you talking to people like you talk to you, a mate, don't you, you’re not standing up doing a TED Talk. Really, that's what it comes down to, isn't it? 

Damien Talks Money  6:37  

Yeah, and I work hard to make it like that. I think, you know, you know how hard it is to be natural, you turn a camera or a microphone on, it all goes out the window a little bit, I just think that it doesn't matter if you're the smartest person in the room, if no one will listen to you. It doesn’t, you know, it's pointless. So I always thought there was a way to kind of make this a little bit more relatable and understandable. Because I knew that I would speak to my mates around investing. And I would have conversations that I felt were basic, and they were like, you just need to take this back even further. You know, what is an index fund, etc. And I felt that that was the area that I could kind of attack.

Jason Mountford  7:13  

Yeah, I think that's a trap, I think that people can easily fall into in any industry really, it's like, if you surround yourself with something for a certain amount of time, you get to a level of experience where you don't understand, you can't appreciate how basic or how hard it is to understand the basics if you've not learned the basics, and I think that's definitely something that that personal finance content creators can fall into. 

It's like, oh, everyone knows what active versus passive is. So I'm going to reference that in my content, but not explain what it is. And a lot of people are sitting there going, “What the, what the fuck is passive? What does that mean? I don't know.”

Damien Talks Money  7:47  

Yeah, the content that gave me the propeller initially was literally go here, click here, move mouse here, kind of click a button, click on how to invest. And, you know, it might sound simple, but it took me until I was in my 20s to start investing because I had this notion that it was, you know, complex algorithms and I needed to be a maths genius. And this perception that's put in place probably by the industry itself to protect its commissions means that we have this perception, that it's a lot more complicated. I think when someone shows you how easy it is, like, you know, from an index fund perspective, I'm not, I'm not saying all investing is easy. But from a, you know, getting started perspective, you’re kind of like really, is it that easy? Is it you know, once you understand that concept of just buying a whole marketplace and passively investing in it's kind of like a light bulb goes on.

Jason Mountford  8:38  

Yeah, totally. I think you're exactly right. I think there's been years and decades of an industry that tries to make investing that like it's out of reach without a middleman, someone like me as a financial planner in the middle, you know, and the reality is that for a really high proportion of people, you just don't, you don't need that, it is pretty straightforward. 

I always think it's actually it's like, like health and fitness sort of thing. The actual nuts and bolts of what you do is actually really straightforward. The actual hard part about investing is like the mental side, like going through a market correction staying invested. And kind of understanding that side of things rather than what is a share. What is gilt? You know, that sort of thing.

Damien Talks Money  9:20  

Consistency. So using your gym analogy, that consistency is far more important than the exercise that you do. It's just showing up and putting the reps in and I think with investing it's that staying in the market consistently is the consistency you need.

Jason Mountford  9:34  

Yeah, yeah definitely. So staying on the channel for the time being it grew really fast and I think it had a look at your, I kind of went back to your past videos and like the second one, I know obviously you would have had views since then, but it had like it's got like a quarter of a million views and that was your second video. Is that actually how it happened? Or have you kind of gotten rid of some of the old ones that you weren't happy with or is that like how it happened. So that must have been like, sitting in your house going, What the, what the fuck is going on?

Damien Talks Money  10:07  

Well, to be honest with you, that video’s got 700 to 800 views a day consistently for about two years. So that 250,000 has been a long time coming. But yeah, I speak to a lot of creators in the space. And they post their second video and no one watches it. I posted my second video and 50 people watched it the first day, then 50 people and 50 people, and then it just grew and grew and grew from there. I think I was lucky from the start, in that the video I posted gathered views from the very start, I had that momentum. 

I mean, I did quite a lot of research around keywords, long chain keywords, targeted search, I was quite deliberate in my approach. I think that helped me initially. I think if you're going to do anything, you have to treat it like a business. And I think people often kind of think, oh, YouTube, it's a side hustle. But there's a lot of potential there if you do it right. So, but yeah, it to answer your question. From the second video I made basically, it just kind of just kind of kept going. And that video to this day still delivers 20-30 subscribers a day, I think about 12,000 people have subscribed to my channel from that video alone.

Jason Mountford  11:17  

Yes, huge, isn't it? And do you find, obviously, that that's your most successful video, how do you find it in terms of making subsequent videos? Has it been kind of a steady increase? In the initial views you're getting the kind of overall traction? Or is it literally like video by video will perform or die depending on how good of a job it is? How much resonates with people?

Damien Talks Money  11:42  

Yeah, I mean, there's certainly been a period of time where every video I released was bigger than the previous and I thought I've got this made. And then and this was in the period where it was kind of GameStop. So I think there was an orders of magnitude amount of interest within the investing space. And then it kind of died off during the summer. And I think that's really where I kind of, like, you know, prove to myself when I've kind of went through that period where a lot of other creators that kind of rose with me in that time, fell off or got disinterested. 

You know, I could look at it from a perspective of the second video I ever made is the biggest video I've ever made. And I've never rivalled it. Or I could look at it from the perspective of I've got 50,000 subscribers and the videos that I make now I'd reach you know, 20,000 people a video, whatever, I'm far more interested in what the worst piece of content does in terms of views than I am the best because I think viral videos are out of my hands. If I release 10 videos, I want to know what the worst of the 10 is. Because as long as that worst is getting better, then you know, I'm in a good place.

Jason Mountford  12:51  

That's really interesting, because I think that kind of that kind of links with your point you're saying before about, about treating YouTube as a business. And we are going to get into some investing topics as well as a few things. I want to talk to you in terms of, you know, actual, you know, stock market, inflation type stuff, but I'm just interested in this side of things. 

And I think I think you're exactly right, in that a lot of people have this idea that they're not happy in their jobs, they feel like they want their life to look a little bit different. And that's a lot of what I talk about, it's about making money, but having an endpoint, not an endpoint. But a means, you know, a means to an end in terms of you making that money in order to live the lifestyle that you want to live or do things that you want to do. And I think that's often where people get stuck. They have kind of a vague idea, but not necessarily the understanding that you have to take very concrete steps and work very hard. If you want to make a big change, like making a living off YouTube.

Damien Talks Money  13:51  

Yeah, I don't think people appreciate how much work goes into it. So, you know, a 15 minute video might take me 40 hours to make in total. And I'm trying to put out one a week around a full time job, 2 kids, you know, so that I think most people will just not do it because the commitment level is high. For me I was lucky in the sense that it grew quickly. So I had motivation there. If I was two years into it now, still scratching around for 100 views, I don't know if I would still be doing it. You know, I set myself a goal of 12 months. 

I just think people need to realise that if there's traffic within a niche, if they're going online on whatever medium it is podcast, YouTube, and there are people consuming that content. If you can offer something different within that niche, you will get an audience. And I think that's all you need to think about. I went in and said there's people watching this content in the UK, I can make content that's different to everyone else's. A certain proportion of the audience is going to like my version a different way so that's kind of how I approached it. If you're just putting out the same thing as everyone else you might struggle and I do see a lot of creators just replicating each other and not really trying anything different.

Jason Mountford  15:05  

It doesn't really matter how you’re different in a lot of ways, it doesn't mean, like you on YouTube, you see people who differentiate by, you know, you differentiate by the way you deliver the message you mentioned about your entertainment, mixed with education. Whereas there are other people who do really well in the finance space who are just really smart, they're just incredibly detailed. They provide you analytical information that is so in depth, and that's going to resonate with different people. So I think that's the important point is you don't have to do something that you hate, you don't have to do it in a way that you hate. It's just about finding where your, your strengths match with, like you say, a need that is out there in a niche.

Damien Talks Money  15:47  

You know, I’m not the smartest guy in finance, I've got a career in finance and that but I'll hold my hands up and say I'm no genius. That's intimidating for me that there's people out there that are essentially, you know, swimming in the same waters as me. But they probably turn around and are intimidated by the fact that like the way I present and the way I can crack jokes and stuff, so everyone's got their skill set, and you kind of just need to lean into what you are.

But I think you need to be very intentional at the start if you want it to work because the competition's getting better and better now, within finance, in YouTube within anything, but it's still there for the taking. The opportunity and the scale is massive. I used to be one of those people that I always looked at online and thought how are people making money out of this? How are people making money on the internet, and now that I am making money on the internet, all I can see as opportunities online, it's like your eyes are open to it. I think everyone should have a YouTube channel. Personally, yeah, it teaches you a lot. 

Jason Mountford  16:45  

Regardless of whether you end up making money from it or or being successful, it does teach you a lot for sure. I think it's really interesting to hear you talk like that, because I think for anybody who maybe has watched a few of your videos, you do them, and you mentioned this before, you do them in such a way that it feels like you're just kind of rolling off the cuff, you know, making gags, talking in a very kind of casual way. But I could tell like you say, from just having done videos myself at a much lower level than you but you can tell how much scripting and time and effort goes into it. 

So I think that's really valuable to hear that because people could mistakenly watch those videos and say, and think there's not a lot goes into that this guy's just rolled up with 50,000 subscribers and he's not, you know, just pointing the camera at himself for 30 minutes a week and Bob's your uncle, but I think yeah, that's that's really valuable stuff there.

Damien Talks Money  17:35  

No, most definitely not. I sit and stress over every line every word for hours, and, you know, edit it to the death. One of the reasons I don't have a podcast is because I'm not that confident in my ability just to talk without sounding like an idiot. I hide behind the production. So to anyone out there that thinks that they can't do it, because they're not naturally gifted in front of camera, go watch my first video and tell me that I was actually gifted in front of a camera shot. I mean, I'm not.

Jason Mountford  18:03  

You can learn anything, any skill over time. So let's, let's talk a little bit, let's move into talking about investments. And I guess to start off with something I'm always interested in, in hearing from guys like you is that you, you know, you get loads of people getting in contact with you, whether that's comments on your YouTube videos, or DM’s on Instagram or you know, whatever the case may be. And you I'm sure you get a lot of stories and a lot of people telling you what they've been doing with their money. So from your perspective, what do you think, what do you see as being the kind of the biggest mistakes that people tend to make with money?

Damien Talks Money  18:40  

The first one is over complicating it and not getting started just sitting on the sidelines forever, thinking, Oh, I'll wait till the next crash or I'll wait for this or wait for that, that, you know, all those people that sat on the sidelines over the last 12 months waiting for the crash of missed out on one of the best bull runs in history, you know, so that that is definitely top of the list. 

And then it's surprising to me how many people sit on the sidelines, don't invest and then come to me one day go, “Oh, Damien, and I've invested I've put everything into Dogecoin.” I'm like, wow, you just sat on the sidelines for a year and then you know, cuz you're so cautious and then that's that's the thing you've gone for. Yeah, not starting and then not diversifying at all. 

You know, people don't think that if you buy Tesla by Google, I buy this and I'm diversified but you're probably not, you know, so I think those two are the main things and then expectations. If I put £100 in, you're not going to be a millionaire. £400 pounds, you know, like you need a few lifetimes for it to get there. So it's really basic stuff from beginners, I would say.

Jason Mountford  19:53  

Yeah, crypto’s made that a lot worse though, to be fair, because there are some people that have put £100 in and their millionaire's. That it does make it tough, doesn't it when you're trying to, when you're trying to sell a more realistic kind of image?

Damien Talks Money  20:06  

Yeah, but I remember when I was a kid, there was a story about a guy who set up a website where there was 100 pixels on the website, and he sold each one. Remember that? Yeah, yeah. It's like, it's like, he won the internet at that point. And then everyone was like, Oh, my God, like, you make a million quid by doing that. And it was all these copycats, but that's one guy, you know, like, they speak. I think I'm long enough in the tooth now. I mean, I'm 33. But I think I've seen enough of these. One person who rolls the dice and wins. That isn't the norm. Yeah, no, definitely not know how many people are losing?

Jason Mountford  20:44  

Yeah, yeah, exactly. I mean, that's the case with anything. Survivorship Bias, as I say, whether you're talking about startups or, or investing or whatever, but I think the point you make about people waiting on the sidelines is becoming even more, more relevant now. Because we had this inflation's obviously been, since basically, July this year, it's been kind of cranking up pretty hard. It was at 4.2%. It was coming out at 5.1%, last 12 months inflation at 5.1% in the UK. 

Damien Talks Money  21:17  

And that's the quote, as well, I think I think we all know, it's a bit higher than that, you know, real inflation that affects people's large rents and things like this that aren't included.

Jason Mountford  21:27  

Yeah, no, totally. Exactly. Right. And that's, that's the main concern because, you know, if you're, if inflation obviously has been quite low, the last few years, really, relatively speaking. So waiting on the sidelines, great, but you've not been losing much money in real terms. But that's, that really changes if you're talking about 5% inflation, and you're getting 015% in NS&I bonds. And you’re getting 0.2% or 0.3% on a bonus introductory rate on your cash account? That loss makes you poorer pretty bloody quickly, isn't it?

Damien Talks Money  21:57  

Yeah, massively quickly. I think it will make people panic. You know, because they say 5%. And there's a lot of people have a lot of cash. You know, and when you're talking like 30-40 grand in cash, 5% a year is a chunk of money. You know, you losing holiday. Right. You know, just for having your cash on the sidelines. They need to move, don't they this whole point around interest rates and stuff and, you know, tapering of quantitative easing and things. I think inflation is clearly there. It's clearly kicking everyone's ass. I think I'm not sure when they will. But I think interest rates probably need to go up, don't they just slow things down a bit?

Jason Mountford  22:41  

Well, that's the concern. Right. So they're talking about, Monetary Policy Committee meeting’s tomorrow. I read something today that the IMF, the International Monetary Fund, we're kind of giving the Bank of England a bit of stick for not raising them sooner. But this is the problem that we've gotten, what's the term, stagflation? It's been coming up, because obviously, inflation is when, you know this, but inflation is obviously when the prices are going up. But generally, when we're seeing high inflation in the economy, we're also seeing a good economy. You know, one of the reasons inflation is going up is because there's a lot of economic activity, wages going up. There's more competition for workers. 

But we're in this weird situation where the economy's not doing great. People are feeling the pinch, people are feeling stretched, yet inflation is higher, so that if interest rates go up, it makes the problem worse. But then by the same token, they can't really afford not to put interest rates up because it makes inflation worse. I don't envy them. It's a it's a pretty uncomfortable kind of situation to be in really.

Damien Talks Money  23:38  

Yeah, definitely. But I mean, you know, I've seen what's happened to house prices in the Northwest in the last 12 months. And like, that can't continue. It's ridiculous, because it's just dragging rents to a point now where people, you know, there was a place that was being rented near me, it was £800 12 months ago, it's £1300. Now, you know, that's, that's not a manageable rise in rental prices, like for people. So, yeah, someone's gonna feel it  whatever happens, aren't they? 

I don't know the supply chain inflation that everyone talks about for how long? What's your opinion on how long that lasts for because everyone talks about, you know, the supply chain is disrupted and needs to get back on its feet? How long do you think that's gonna last?

Jason Mountford  24:25  

I think it's gonna last a while like, that's why I didn't really understand all the all this talk about transitory inflation like, okay, but then what's your different definition of transitory like five years I didn't call that transitory like yeah, I'm sure it will be it's gonna pass at some point. 

But I yeah, I'm not, I'm not confident and I think this stuff all this talk about Omicron and stuff the last few weeks. It's kind of confirmed my feelings on that because, you know, we're at a point in the UK where we've got a huge level of vaccination rollout, our booster vaccinations, which supposedly was the thing where it's like, okay, we can go back to normal and yet restrictions are coming in again, you know that a lot of talk about even further restrictions coming in again, every time that happens, there's a knock on effect to that to the supply chain. 

A lot of people who are still having to self isolate until they get negative tests. And it doesn't sound like a lot. But like, if you go if you have a contact, and you have to go do a PCR test that could take, if you're lucky, a couple of days, I've heard of people taking seven to 10 days to get the PCR test back. So even if the negative, you've got all these people having all these little bits of time out of the workforce, and that adds up to just,

Damien Talks Money  25:36  

Millions of days of lost manpower

Jason Mountford  25:40  

Exactly, exactly. If you think of it as a really simple analogy of like a factory line that has people literally on a factory line doing their jobs, if you’re pulling people out, like for little bits at a time. It's yeah, I don't reckon it's going anywhere, anytime soon. What are your thoughts on it?

Damien Talks Money  25:56  

Yeah, I mean, I tend to agree, I think as well, obviously, there's other factors at play? How much has Brexit impacted our supply chain, domestically versus COVID? As well, that's a big mess. That's all tied up together? Isn't it? That's kind of hard to separate. You know, I don't want to comment on it too much. Because people have very, very split opinions. But I think the world is suffering from a supply chain perspective. But we have added pressures domestically, from points around, you know, Brexit, specifically, etc. That compound in that as well.

Jason Mountford  26:34  

Yeah, yeah, for sure. HGV drivers has been the obvious one, but like, care workers is another just so many industries where it's, it's a big, big problem.

Damien Talks Money  26:44  

HGV is the one that people feel. But my friend owns a farm that picks fruit. And he's paying people £70,000 a year to pick fruit, because they can't get the staff that there just running, running at a loss. Essentially, if they don't, it just all goes to rot. So what do we do? We need the cash flow. So we have to pay an equivalent rate of 70 grand, it's like £30an hour just to get people to pick fruit. Yeah, you know, it's all over the place.

Jason Mountford  27:12  

It's one of those ones where I do feel like we are, the word it's not been used as much lately, actually, but the whole thing, the word that always gets bandied around with COVID is like, unprecedented times. But I literally do think, you know, if we look back to what happened in like, the 70s, or we look back at like, you know, the Wall Street crash back in the 20s. Like, we still talk about the 1920 stock market crash, the 1929 Stock Market Crash now, because it hadn't happened before. And I think there's going to be a lot of stuff that happens over this kind of 5-10 year period that they're looking back on in 100 years as something that shapes government and fiscal and monetary policy, like going forward because we just no one knows what they're doing, basically.

Damien Talks Money  27:57  

Yeah, yeah, no, I completely agree. And no one's dumped this amount of money into the system so quickly, and you know, seeing the effects. No one's ever locked down the whole world. There's been a lot of firsts, hasn't there. So over the last 24 months, I guess it's an exciting time to be alive is one way to look at it, you know, will be remembered as a point in history. This will be the stuff you talk to your grandkids about Jason, no doubt.

Jason Mountford  28:24  

What’s that Chinese proverb, “may you live in interesting times.”

Damien Talks Money  28:27  

Yeah. Yeah, I'll take boring times.

Jason Mountford  28:34  

So I think, all that kind of leads well onto one of the things I wanted to ask you about, which is cryptocurrency. It's kind of it over these last couple years. It's gone from something that a few nerds knew about. And there were a few currencies floating around. And now it's just normal. It's mainstream. It's part of, you know, mainstream financial services mainstream investing. It's on the news on BBC News. You know, we were hearing about it a lot. 

Obviously when it comes to Bitcoin, there's lots of people that talk about money printing and you know, those sorts of things. There's a lot of hardcore Bitcoiners who feel that Bitcoin is the antidote and solution to all our problems. What is your take on crypto and Bitcoin? And you know, Web 3.0 and NFT’s all of this proliferation of new technology and currency that we're seeing? 

Damien Talks Money  30:21  

It’s a big question, isn't it? So I think that obviously, a lot of people will sit there and go, Oh, Blockchain is a really interesting piece of technology. It's going to change things. And I do. I do think that is the case. And I think the argument of comparing it as to the .com bubble where the blockchain was the internet, there was a lot of interest in technology. And then there were all these websites that were placed on the internet, and a lot of them failed. 

I think that is a relevant point, when you're talking about specific tokens, you know, we're talking about all these different cryptocurrencies that are popping up. If we talk about Bitcoin first. What I like about Bitcoin at this point in time, as a real world, real use case right now, is the fact that you can convert energy into value at source. And I think there's a lot of countries that have energy supplies that would bet that, you know, geothermal, oil, wherever the there in the past weren't very useful to them. Whereas now, they might have an ability to basically say, Okay, well, we'll park some, some, you know, mining equipment here effectively and convert that energy into value at source, I think that's quite a compelling value case for a lot of countries. 

And as long as Bitcoin specifically because of its finite nature and how big the network is, as long as the value holds in that and the trust holds there, I can see that as being energy into value I see as something that is quite valuable. And I think as we progress, we'll look at energy more like value anyway. I think, you know, Elon Musk's whole proposition is a lot like that. It's around the energy piece. Now with the others a theory and again, I think there's really strong use cases. 

I think whenever there's an unregulated industry, though, sharks will come out. And I think a large proportion of the whole industry is scams. But I hold crypto I've got quite a lot. So that probably tells you all you need to know.

Jason Mountford  32:22  

Yeah, there's a lot to like about it. There's a lot to learn. But I think you do have to understand it, at least to a certain point before you go throwing your money. Because like you say, if you do throw it into something you see on Twitter, and you lose all your money or someone scams you like there is no comeback. There's no government that can help you out. There's no insurance scheme, there's no nothing. And I think that's the point that I keep trying to drive home. It's like if you get scammed, there's no one you can go and have a complain to, the police aren't going to do anything. Because the person was probably anonymous, and they can't they can't do anything. It's not, you know?

Damien Talks Money  32:56  

Yeah, the squid. The squid token was an amazing example of that..

Jason Mountford  33:00  

Yeah, exactly yeah. I think you make a really interesting point actually about Bitcoin and the mining, that's certainly something that I've been learning a bit more of recently, because one of the biggest criticisms that gets levied on Bitcoin is that it uses so much energy. And I kind of only recently read an article in the Harvard Business Review, which was explaining that it is true that it uses a lot of energy, but energy doesn't necessarily correlate to pollution. And that's a really good point like it's kind of thrown out there is like you use all this energy as much energy as Belgium or something and you think shit, that's, that's not good. But then wind power creates energy. But that doesn't the wind doesn't pollute us does it? 

So that's, that's really interesting point because the article is going on then about what they call orphaned sources of energy, which kind of what you're talking about there where like, for example, there's someplace in China that gets a massive amount of rainfall, and they've got hydroelectric energy there, but it's only for a certain period of time throughout the year, and they have way too much than what they can use, they end up dumping a lot of it. And that like you're just saying there is a really interesting use case for let's harness that, we don't need to put it on in a battery and send the battery somewhere, we don't need a pipeline to try and send anything anywhere. Set up some server rooms, mine some bitcoin and convert that and actually use it. I think that's something that you don't hear as much really in the mainstream.

Damien Talks Money  34:24  

No, you know, what doesn't use energy? I mean, like everything consumes energy and I think to say that Bitcoin is the problem, I think we have a clean energy problem we don't have a cryptocurrency problem. One example would be you know, gas burn off, where they essentially burn gas oil refineries, because the gases are a waste product to them obtaining oil, they instead of burning that gas, they can burn it still but convert that into Bitcoin at source, that again, that is completely, that's actually cleaner in that sense, because it generates that value. 

Or, you know, a volcano like El Salvador. I mean, El Salvador is a bit of a wild place, though. I mean, I don't know if I'd like to live there personally with everything that's going on there like the experiment for Bitcoin, I don't know. But they're doing some interesting things. And you know, they've got crypto mined inside of a volcano. You know, people talk about the energy usage who, who's turning their lights on, with volcano juice? I don't know many people are. Now you say, not all, not all energy is dirty energy.

Jason Mountford  35:33  

Yeah, it's gonna be really interesting. The next few years, I saw something I mean, they’ve obviously got those Bitcoin backed bonds, which pays a lower interest rate than their normal bonds, because it's supposedly, you know, it's backed by an asset, a volatile one, but it's backed by an asset. And I saw something today about first, not in the not in the UK, it was in the US, but the first regulated Bitcoin back to mortgages, where you get a lower interest rate on your mortgage by putting up Bitcoin security. So yeah, there's lots going on in the space.

Damien Talks Money  36:03  

Yeah, I've traditionally use premium bonds as a place to store my emergency fund, mainly because the bank and interest rates are so low that I might as well have a play on a lottery essentially, to see if I can hit a jackpot. Because, you know, keeping it in an easy access savings account, I'm getting, like you said earlier, under half a percent. So what's the point? 

Now, I found recently, more and more that staking against stable coins. Actually, I don't, I don't really like Tether for quite well publicised reasons. But USDC, which is Coinbase's own, I've been staking that now for well over a year. And well staking or, you know, I take it and lend it to them, they lend it out, wherever however you want to describe that relationship. And 9%. Again, 9%, it's, it's almost too good to be true. For someone like me, I'm very much like that, that doesn't make sense. 

But when you look at it from the perspective of people within the cryptocurrency industry, they really struggled to get their hands on dollars, because traditional finance won't lend to them. So they will pay quite good rates to secure what is effectively dollars in a USDC or whatever, so that they can short and trade or do whatever they want to do. 

So I do I do sit there and think, you know, you're talking about bonds and stuff like this, some of the ability to generate yield on like I can, I can take effectively £1,000 pounds of my £30,000 emergency fund or whatever, and completely hedge against inflation with that couple of grand through USDC. On a platform like Coinbase, which I'd say is relatively trustworthy, and just completely destroys any inflation risk. I think that to me is like absolutely game changing.

Jason Mountford  37:49  

Yeah, I mean, there are, there just are so many possibilities. But I think kind of going back to your kind of earlier point that you're making, when we first started chatting is I think the problem is, is that people can start focusing on that stuff, what I would call the margins of your financial plan of your investing strategy, over the the kind of more than the nuts and bolts, the basics where you want the majority of your funds for most people. So I think it's a really good point. There's loads of stuff out there. 

But I think for people who are considering that type of thing, or going deep into crypto, you need to do that after you're comfortable with the basics. And one of the things I wanted to talk to you about today was about as basic as it gets really, and that's the idea of the kind of the two main approach to investing which is, you know, an active approach to investing using an active fund manager, or passive like Vanguard, which, which you mentioned at the start. And I know you're a fan of Vanguard, but what's your take overall on the kind of active versus passive debate?

Damien Talks Money  38:53  

Traditionally, I've always kind of leant on the other day and said, you know, why would you why would you go active when passive has knocked the socks off it for quite a while, the more that I kind of research into the space, the more that I do think active has a place certain certain areas of investing, for example, ESG, I find it hard to believe that you could have a passive ESG approach because I think if you really care about ESG factors, how are you applying that screening if it's passively that doesn't make sense to me, I think you need a team there to really be working with the businesses to ensure that ESG component has been applied. 

I also think as well, certain countries, I think maybe an active approach where there's experience there might work. I think it's hard for me because of my age and stuff. I've seen just passive knock the socks off most things for quite a while because of fees and just performance. You know, I think for that reason, everyone touts index funds as that as the thing but there might come a day where active has its moment. I personally think everyone should have a passive element and that should be the backbone of their portfolios, for me anyway, just because I think fee reduction is the most important thing. And I think a lot of active fund managers charge quite a lot.

Jason Mountford  40:13  

Yeah, I mean it if nothing else, having passive managers be so successful as they have been, at least is putting some pressure on the active managers' fees. I feel like they have come down quite a lot. But yeah, I would tend to agree with you think for the bulk of kind of the core allocation for most people's portfolios, if you're talking about a market like the US, you know, the US stock market is, is scrutinised so heavily, the chances of anybody being able to find any, any outperformance above the market is, is basically, you know, my opinion, like there's just too much liquidity, there's too much money, too many research dollars that are going into it. 

But, you know, from my perspective, what I'm looking at, I think you mentioned a couple of examples there, I would say the same sort of thing is that if, if you having an allocation to kind of, more niche countries, like if you're investing in Taiwan, or Japan, you know, I would say that's probably a market where the overall knowledge in on a world scale, the knowledge of those markets is probably significantly lower. 

So if you've got a fund manager who is on the ground, living in Japan, knows Japan, works with Japanese people and understands the culture and the markets, it's probably something that's worth paying somebody a little bit of extra money to, to actually put their expertise and put that knowledge and those relationships to good use.

Damien Talks Money  41:32  

Remember, the Jupiter India Fund, that ever came across your like, your horizon back in the day, it was quite a big fund, but I think at the time, India was like a place where everyone's like, it's gonna be the next China, but no one knows anything about it. It delivered, you know, 20-30% returns for four or five years, and then absolutely imploded for a few years after, and was like a real, a real case of like, active management, you know, because people piled into it because of the returns. 

But the guy who managed it at the time, he claimed to know India well, and I think he did, but I think that was a country that was so steeped in corruption and volatility and a lot of other issues that were outside of his point. And I think when you're talking about countries that you say, like, niche countries, niche countries are niche for a reason, that can often be because some of the factors around them make the markets a little bit more wild. So I think you've got to factor that in as well.

Jason Mountford  42:32  

Yeah, I mean, it then they always come down to the same thing doesn't diversification. Like really, you know, if you're keeping it simple, there's so many risks in investing that can be not not removed completely, but removed to the point where they're not something that you need to worry about too much. As long as you have enough diversification in your portfolio.

Damien Talks Money  42:49  

Yeah, it's hard though when you see someone all in on something getting 50% returns in a month or whatever, but yeah, I think they'll come good for us when it all does come crashing down when we're well diversified.

Jason Mountford  43:01  

Yeah, which is the podcast episode that came out today. I was talking about that, about investing, the title was “Should you invest at all time highs”, because it's always the way, money flows into the markets at a much greater rate when they've performed incredibly well. And we had, you know, you mentioned one of the best years returns, 26% year to date in the US, it was like 16% last year. Do you think we will be due a correction soon? Or do you reckon that the money printing is gonna keep things flying high for a little bit of time yet?

Damien Talks Money  43:32  

I definitely think we’re due a correction, whether we'll get one is a whole different story. And I try not to pay too much mind to that because there's so many quotes, isn't there? You know, the market can stay irrational longer than you can stay solvent, or I've seen more people lose money, you know, trying to time the market then has actually been lost from crashes and things. 

I mean, 12 months ago, I would have told you that if I had to, I would place a bet on the fact that the market was going to take a dip because look at what we've been through, the whole world shut down with Covid and we just shook it off in a few weeks. So yeah, I just consistently invest and then when I see the market tanking, I consistently invest more you know, on a regular basis I think when when the market, I think it was in 2020 when we saw that that really quick drop, I just moved from buying monthly to every single day and that's that worked for me and that's that's what I will do. I always have a cash allocation on the side.

Jason Mountford  44:29  

Yeah, makes sense. None of us can time the market so just set things up so you don't have to worry about it or think about it really.

Damien Talks Money  44:37  

Yeah buy all the way down and back up again. And you'll hit the bottom then and you can go and say and like “I timed the market” if you like, showing people that you bought the bottom on that day, but you just bought every day!

Jason Mountford  44:48  

Yeah. I actually saw an interesting thread on Twitter and I don’t know if you're on Twitter, but it was like Preston Pysh. I can't remember how to say his name, but he…

Damien Talks Money  44:58  

The value guy he likes Bitcoin?

Jason Mountford  45:01  

Yeah, yeah, exactly. Did you see that thread? It was like everyone was retweeting it. 

Damien Talks Money

No, I haven't seen it. 

Jason Mountford  

So he was basically saying, which is true, which is what you just mentioned that we've gone through, like this insane couple of years. And yet, if you flew down from an alien planet and looked at our stock market, you'd think we'd had the most amazing couple of years ever, like, everyone's having a great time, everyone's just loving life making heaps of money. 

And so he overlays the performance of the S&P 500, basically converts that back into US dollars, because he's explaining that, whilst your investments, your investments that were worth $100,000 3 years ago, have gone up, and now are worth, you know, $175,000 there's been so much more money put into the system, that if you convert that back to the per dollar increase, it's actually like, 6%, over the last three years or something like that. It's crazy. I'll send it to you afterwards. 

Damien Talks Money  45:57  

Yeah, well, I mean, it makes sense, doesn't it? If everyone's a millionaire, no one is kind of thing. If, you know, if it's all going on, it doesn't really make much of a difference.

Jason Mountford  46:05  

Yeah. So one of the last kind of asset classes I wanted to touch on just briefly, really, but we talked about yields a little bit and the income that you can earn from a bank account and some of the alternatives in crypto. And one of the things that I'm seeing pop up a little bit more, is like property and infrastructure. 

And it's one of those weird allocations where even if you're investing in like a Vanguard multi Asset Fund, there will be a section of property, but I don't think many people kind of understand too much what property and infrastructure actually is really within a portfolio. So do you kind of have any thoughts on that on property and infrastructure as an asset class? Is it something you just kind of ignore? Do you pay a little bit of attention to it? What's your kind of take on that?

Damien Talks Money  46:49  

Well, I've got some REITs. From a property perspective. So I think the one that I did quite well on was the try tight, you know, the big box kind of stuff that that did, has continued to do well, for me, I had a look at it, because obviously, before we came on, I saw that is it is it PAVE, is quite a big one are PAVE, the Global x US Infrastructure, they seem to have done really well in the last, basically, since since the drop.

I used to work in this field of projects being built. The one thing I'd worry about from an infrastructure fund perspective is a lot of infrastructure projects get delayed massively, and they run massively over budget or don't get built at all. And a lot of the companies that work within the infrastructure space, really struggle with cash flow. I know this because we had it. I don't know these funds well enough to comment, really, but how are the returns worked out? You know, are you buying into a business or buying a fund that then is engaging in infrastructure projects? Is that what they're doing?

Jason Mountford  47:52  

So usually, they're not, they're not developing the infrastructure projects. Usually they hold the assets. So they tend to be more of an income play. So they like a simple example, like, I'd like a toll bridge. So they don't the company doesn't necessarily build the toll bridge, they purchase the toll bridge. And then they make projections, obviously on what level of tolls are going to generate from that. 

So it's more of an income based asset rather than a kind of capital appreciation off the build. The main concern that I see with property funds and infrastructure falls into this, this as well, is that huge problem we saw in 2008, I was just new into the financial planning industry, financial services industry, in 2008. Bit of a baptism of fire was, it was like I joined, and then three months later is like the worst financial crash in history. But they freeze, they freeze the funds, I'm sure you've come across this before. 

Because you've got a fund manager who's running an equity fund, and they've got a lot of redemption, they got a lot of people that want their cash out, because they're scared, they can just sell the equities. Like, it's not necessarily a good time to do it, but I can. But if you've got, if you've got a bridge, and you've got people that want their money, you can't, you can't easily sell a bridge. 

So that's the main concern I always have with that. And that's why I always, you know, you see some, like some of the yields I'm looking at here, some of these infrastructure funds, like six and a half percent, five and a half percent. Looks pretty attractive. But, you know, if you can't get your money out when you want to, it's kind of you just got to be really, really careful about it.

Damien Talks Money  49:24  

Yeah, do they have requirements for cash in terms of how much they have to keep in cash? Luckily, you know, the REIT structures I quite like because they're quite clearly defined in terms of how much income they have to pay out and how they spend the money and stuff. I find that structure works well for me, from an income perspective. They're not, they're not a massive holding to me, but are these the same?

Jason Mountford  49:45  

Yeah, so they are the same. The issue with all of it is that they're kind of they built the regulations to make them do that within tolerance levels, but if you have something that's kind of crazy, like 2008 it tends to blow a lot of those models out of the water. 

REITs which are exchange traded, that is a really good alternative because they are exchange traded. So you don't have that same, that same issue. But I find it's harder to find Exchange Traded infrastructure funds, and you also have the issue of Net Asset Value and re-valuing of assets that can cause a bit of havoc. So it's not definitely not a perfect scenario. 

But I just think it's one of those ones. I actually saw the initial article on The Daily Mail, which I don't read for myself, but I read because there's lots of people that read it. So I like to know what kind of what and when I saw infrastructure funds pop up a thought, you know, I could just see someone piling a bunch of money into an infrastructure fund paying 7%. And then we see a big market crash, and it's like, shit. What do I do now?

Damien Talks Money  50:47  

If the Daily Mail's reporting on it, I would probably say that's a good sign that you shouldn't be buying. Like, I mean, I think it's in the main tabloids, it's probably done, isn't it? Surely, if it's on the front page of the stock market? It's the shoeshine boy kind of thing, isn't it?

Jason Mountford  51:04  

Yeah, definitely. So before we kind of finish up, I just want to talk a little bit more about a little bit more about, I guess, alternative careers. I would say I don't know if that's the right term. But you know, we talked a little bit about YouTube at the start. We've seen in the US and to a certain degree in the UK, what they're calling like, The Great Resignation, with people chucking the jobs, and, you know, having a bit more power over that. Do you think we're seeing a kind of permanent change with that? Do you think people are going to be doing more kind of freelancing, working for themselves? Or do you think, again, that this is something that will kind of pass if life does go back to normal-ish?

Damien Talks Money  51:44  

Yeah, I mean, I'd be, I'd be interested in the data around how many people have resigned and then got another job, because this Great Resignation paints this picture that everyone's just quitting their jobs, and, you know, like to start in their own little side hustles, or whatever? I don't I don't think that that is the case. 

And I think like a lot of the media is leaning on one side of it, I think people are resigning from their jobs and going into new jobs. I do think that there will be a shift in the whole gig economy out there and I think that that will rise more and more, but I don't, I think the traditional format for work has been in place for quite a while. And I think we're going to find it quite hard to shake that. People still need to pay the bills, don't they? 

And one thing I can tell you from YouTube is staying consistent. You know, I'm lucky, I've got a partner that earns good money as well. I work full time currently. But if I was to jump full time into YouTube, and I had a lot of responsibilities, that's quite a nervous position, I don't think everyone is going to want to take that massive leap. I think now's a really good time to renegotiate how much you earn and look at your options. But I don't know if we're going to see this massive shift in the way everyone works. And everyone starts, you know, doing their own thing. 

Jason Mountford  53:03  

Yeah, it doesn't have to be extreme does it, it's an opportunity to push a little bit more towards what you want, what you want. Your ideal life would look like, it doesn't necessarily mean you've got to chuck it all in and move to Mexico or something.

Damien Talks Money  53:16  

No, but I do think, you know, everyone should try and carve out a little bit of time. I think, for me, what was eye opening was, I've spent my whole time head down in a career and your nine to five plus an hour either side for a commute, you come home, you're knackered, and at the weekend, you spend it with the kids or the family or having a drink wherever your thing is. 

As soon as I had four weeks off, I started my YouTube channel and my life changed. It's like as soon as you get that little bit of time and you focus just that all that energy that you put into a nine to five on something else, you can probably quite surprise yourself with what you can do. 

You spend your whole career building stuff for the people, don't you? So if you focus that energy on yourself, I think a lot of people out there are probably quite capable of building something quite cool pretty quickly. And I think the tools are all there now for us. Anything that you need is on Fiverr. If you need a graphic designer or whatever, it's all there.

Jason Mountford  54:11  

Yeah. So other than getting the views obviously getting some money coming in, what's been the biggest thing you've learned or the biggest takeaway you got from starting the channel so far?

Damien Talks Money  54:27  

I think we spent so much of our time worrying about what people smarter than us think about what we have to say. When I think in reality, what you need to worry about is what all the people who don't know as much as you have to say about what you have to say. 

So I think most people are put off from doing things in their life because they think I'm not having the best day. I'm not the smartest. I'm not this. I don't think any of that matters because wherever, whatever knowledge point you're at in something, there's a million people behind you that don't know anything. And the Internet gives you access to those people. That's kind of what I've learned.

Jason Mountford  54:58  

Yeah, that's really good advice. So what's the plan for you over the next kind of 12 months or so in terms of growing the channel? In terms of other things you want to pick up on top of it? What are you thinking for Damian Talks Money?

Damien Talks Money  55:11  

Yeah, I need to scale the amount of content that I make, I think I've got proof of concept. And I'm just nervous about making the leap from my full time job. Hopefully, my employees don't listen to this. But I should probably quit my job and go at it full time. And see and see where I can take it from there. I just like to make more content and have more time to build the community. For me, it's all about I mean, it sounds really cheesy, but I've never done any sponsored content, I only just make videos and give them away for free, I will do sponsors down the line. 

But at this point, it's all about just building that community and engaging with them as much as I can. I've still replied to every single comment I got on the channel. And there's a lot. I think it's 14,000. Yeah. So you know, more of what I do at the minute, more content, etc. I've just moved house actually. So that I can build out a studio that I'm now sat in. I don't know if there's an echo. But I'm sat in an empty room, I literally moved today, just coming in, had fish and chips and then sat down to have a conversation with you. So I've got, I've got I'm in the loft at my old place. And now in this place, I've got a whole double bedroom. I'm going to kind of like YouTube, so that I can systemize the content a little bit more and have different angles and stuff. 

Jason Mountford  56:29  

I appreciate you speaking to me, if I just moved house though, there's no way, I wouldn't be talking to anyone! So the last thing you want to do isn't so I appreciate it.

Damien Talks Money  56:37  

When you've got a side hustle. This takes up every minute of every day, ever since. Like it's everything, everything is hard work nowadays. So yeah, I'll quit my job. But no, I enjoy it. I enjoy speaking to people on the other side of the lens, because it makes me realise that there's a whole, there's real people out there. Everything at the minute is me sat in my loft and editing videos and then putting them out and typing. I rarely get to engage with real people. So I always jump at the chance of something like this because you're someone within the industry and you're also a real person who I found out doesn't live too far away from me.

Jason Mountford  57:11  

Awesome. Well, thanks. Thanks so much for coming on the podcast man,I really appreciate your time. I think getting your insight on some of those things is really interesting. For anyone who hasn't come across Damien, do you want to just give us I mean, it's Damian Talks Money. It's on YouTube, isn't it, that's where you can find all the content. But thanks very much for coming on the show, mate, really, really appreciate it.

And guys, if you want to check out Damien's YouTube channel, obviously you can find it on YouTube, I'll put a link in the show notes to all Damien's social pages and his YouTube channel, so you can check it out there. And…. and nothing really, that's it!

Damien Talks Money  57:48  

That's it!