What makes the U.S. consumer and investor unique? Are we biologically programmed to be dissatisfied? Should you want your kids to be poor?

Author Morgan Housel answers those questions and provides insights from his latest book, The Art of Spending.

Also in this episode:

• International stocks have notched a 30% gain so far this year.
• The Fed cut rates but dampened expectations for December.
• The job market is always in flux, as demonstrated by a slew of recent layoffs.
• The most tax-efficient way to give to charities may be donating appreciated shares of stock.

To catch full episodes of all The Motley Fool’s free podcasts, check out our podcast center. When you’re ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on Nov.01, 2025.

Robert Brokamp: The forces that get us to spend our money in unfulfilling ways and international stocks continue their winning ways. That and more on this Saturday Personal Finance edition of Motley Fool Money. I’m Robert Brokamp, and this week, I speak with Morgan Housel about his latest book and why we spend the way we do. But first, let’s look back at last week and money. On Tuesday, international stocks crossed the 30% threshold for the year as measured by the performance of the Vanguard Total International stock ETF, which tracks the foots global all CAPEX US index. That is approximately 12 percentage points ahead of the S&P 500. So far this year, foreign stocks are outperforming US stocks by the widest margin since 2009. This year’s excellent returns, international stocks are still much cheaper than US stocks. The PE for the Vanguard International ETF is 14.6 compared to 22.9 for Vanguard’s S&P 500 ETF, according to Morningstar. Our next item from last week is the Federal Reserve decision to lower the target for the Fed funds rate by another 0.25%. But the real news was that Chair Jerome Powell dampened hopes for future cuts. In the press conference after the meeting, Powell said, “In the committee’s discussion at this meeting, there were strongly differing views about how to proceed in December. A further reduction in the policy rate at the December meeting is not a foregone conclusion, far from it.” The bond market reacted by sending rates upward. The yield on the 10-year treasury popped up above 4%, the largest one day climb since July. To a certain degree, the Fed is flying blind. The government shutdown has reduced the release of official economic numbers to a trickle. One figure that was recently announced, albeit belatedly, the inflation numbers for September, which came in at 3% up from 2.9% in August. Stubborn inflation is one reason why an increasing number of Fed officials seem to prefer to take a pause in December, according to Powell.

Now the number of the week, which is 60%. That’s percentage of jobs in 2018 that did not exist in 1940, according to a study from MIT recently highlighted by Market Pundit Sam Ro. If the researchers updated their study through 2025, the percentage would likely be higher, including many new jobs related to AI. A recent Wall Street Journal article took a broader look at how the labor market has changed over America’s history. Putting out at 1,800, 83% of the labor force worked in agriculture and a third of the country’s workers were enslaved. By 1950, manufacturing had replaced agriculture as the largest industrial sector and the average workweek was 41 hours down from 51 hours in 1910, and in both 1910 and 1950, about a quarter of the workforce were foreign born. Manufacturing in the US peaked in 1979, and today the largest segment of the workforce works in service industries, providing healthcare, education, marketing, and accounting, instead of actually creating tangible goods. I bring up these historical shifts in light of a slew of high profile companies announcing layoffs recently, including Amazon, UPS, Microsoft, Intel, Target, and** Meta**. These are in addition to the nearly two million people who have been unemployed for 27 weeks or more, according to another article in the Wall Street Journal. As you might suspect, AI is partially or largely to blame. The journal article cited a company that has cut its software development team by 80% while also boosting productivity, thanks to AI writing its own code. Last week, I spoke with a real estate developer who told me that the work that used to take free employees now only requires one, thanks to AI. Technology changes, the job market changes, society changes. It’s always been this way, but that doesn’t make it easy or pain free. If your role could be threatened by AI, tariffs, or just a slowing economy, come up with a plan B and a plan C. I know I have. After all, unless you’re retired, your most important asset is your ability to earn an income. Next up, why we spend money in sub-optimal ways when Motley Fool Money continues.

I first met Morgan Housel in the press box at the 2009 Berkshire Hathaway Annual meeting when he first began writing for the Motley Fool. He worked at The Fool for many years before setting off to begin his very successful career as an independent author, but he still occasionally returns to his foolish roots, including recently giving a speech at a gathering of Motley Fool members. After his presentation, I joined him on stage to have a conversation about his latest book, The Art of Spending. Well, hello, Morgan.

Morgan Housel: Hi, Robert. Good to see you.

Robert Brokamp: Good to see you, too. Excellent presentation, excellent book. I checked this morning. Number 19 on Amazon on the list of best sellers. Congratulations.

Morgan Housel: Thank you.

Robert Brokamp: You mentioned in the book that a good question to ask of people is, what have you experienced that I haven’t that makes you believe what you do? What have you, Morgan, experienced that has led you to this successful career thinking and writing about money, but in a way that is unique and is clearly resonating with people?

Morgan Housel: No, I don’t know if this is too personal to me, but one thing that’s interesting with investing is, I think it’s easy for us to overlook how unique the American investing culture is and that other Western rich countries do not share. About 55% of Americans own stocks. It’s the highest it’s ever been. Most of those are in their retirement accounts. But if you look at other countries, the UK, Germany, Australia, South Africa, other countries, it’s nowhere even remotely close to that. If you were to ask them, if you were to go to Germany and ask them about their investing culture, they view it so differently than we do. We view it as owning a slice of capitalism. They view it as participating in a bunch of scams and frauds. That’s not much of an exaggeration. I think you can ask is like, why is that? Here’s what’s very interesting about it. The German stock market, the South African stock market, the Australian stock market, have done about as well as the American stock market over the last hundred years. The answer to the question, why do they think differently is not because their markets have performed worse. It’s almost identical.

There could be a lot of reasons for that, but I think one of the big ones is this. Particularly for Europe, at the end of World War II, the countries were absolutely devastated, completely bombed into rubble. I think, by and large, in broad strokes here, they came together and said, we want our downside capped going forward. We want a very strong social safety net and we don’t really care about upside potential. America was almost the opposite at the end of the war. It had all this opportunity in front of them. They had a monopoly on global manufacturing. Americas more or less came together and said, we don’t want much of a social safety net, but I want the sky to be the limit. I think that is held literally across generations. It’s compounded over time. If you look at at investors in Germany or France or the UK, it’s very common for Americans to look at them and say, you’re not taking enough risk, you’re not optimistic, you’re not doing this. I think a lot of that is just cultural. If I or you or any of you were in that situation growing up in those countries, you might very well think the same thing.

Robert Brokamp: You called your book The Art of Spending, not the science of spending, but you do mention some science in the book, particularly, you mentioned a book called The Molecule of More and talk about the role of dopamine and creating desire in us. To what degree do you think we’re just biologically programmed to be somewhat dissatisfied, discontented, constantly craving?

Morgan Housel: I learned this thing from another great modern philosopher, Will Smith, the actor. He once talked about. He said, becoming famous is the most amazing feeling in the world. Being famous is merely OK, and losing fame is one of the great agonies of life. But I think you can apply that even if it’s not fame. You can apply that model to so many things in life, particularly money. Getting wealthy is awesome. Being wealthy, I think is often just merely OK and losing wealth can be agonizing for people. What’s inherent in that is what you actually want is the change. What you actually want is growth. You just want the number going up over time. That’s true for a lot of things in life. That’s just dopamine talking. Dopamine doesn’t care what you have. It just wants you to pursue more of what you already have. What’s important about this is that you cannot read a book or look at a spreadsheet or come up with a chart that’s going to change the amount of dopamine that you have rushing through your head. We’re all beholden to it some people more than others, but I think that’s really what you want is not necessarily more money. You want to partake in the process of getting more money.

Robert Brokamp: You wrote in the book that one of the solutions is just learn to be content. You mentioned another book from more than a century ago, the Quest of a Simple Life written by William Dawson, an Englishman. I just want to read the way you summarize the book. You wrote, “People who are trying to get more money are actually held captive by it. What they intended to be a strategy for a better life became an ideology they are beholden to like an invisible dictator.” That phrase invisible dictator really stuck with me. It reminded me of a couple of lines from one of my favorite philosophers, Tyler Durden from the movie Fight Club. One of his lines is the things you own end up owning you and another line is advertising has us chasing cars and clothes, working jobs we hate to buy crap we don’t need. We have these forces. Some internal, some external that are trying to get us to spend our money in ways that are ultimately unfulfilling. How do we fight against that?

Morgan Housel: I think it’s much easier said than done, so let’s not pretend that this is just an easy thing to do. But I think going back to the idea that we always overestimate how much attention and admiration we’re getting from other people. That can really put a cap on your material aspirations in a wonderful way because once you feel less desire to insert yourself on any kind of social hierarchy, then you can use money for what I think is its best purpose, which is independence. Autonomy, being able to live the life that you want to live once you come to terms with the fact that nobody’s paying attention to where you live or what you’re driving or how you’re dressing, I think that could be a wonderful thing. It’s not an easy thing though, too. I think it’s close to I think a good analogy here is meditation. If you learn meditation, you don’t get to a point where you can just stop. You have to do it continuously forever. Even the best people in the world, you don’t like, oh, I mastered it now I can stop doing it. I think that’s true with a lot of things with money and psychology as well. You have to remind yourself of this stuff daily because your intuition and the amount of dopamine that you have is always going to be pulling you in directions that are not necessarily going to lead you to a happier life. It’s a daily reminder sometimes to fight these urges.

Robert Brokamp: Part of what I think your message is being very mindful of how you use your resources money, but also time and attention. You were recently on Derek Thompson’s podcast, Derek Thompson being the journalist for the Atlantic. He had this interesting metaphor. I’m going to paraphrase it. But it’s like every day you wake up and you have a pitcher of water. You can choose to distribute that water throughout your day. You can fill your wife’s glass, your kid’s glass, your job’s glass, or social media’s glass, sports team’s glass, Netflix glass. He said, you’d be astonished by when you reached the end of the day, how much time you spent filling the glasses of people you don’t really care about. Meanwhile, as you pointed out, your wife and kids are over here getting increasingly dehydrated.

Morgan Housel: [laughs] I think that’s always been true and social media just makes it true by ten orders of magnitude because everything of how well you’re doing in life and how wealthy you feel, again, is relative to other people. Doesn’t matter how much money you have, how much money you have relative to others. That is always true for everybody. It used to be, and when I say used to be, I mean like 10 years ago, that when you say other people, you met your neighbors, some of your coworkers, maybe your siblings, that was your comparison group. Now because of social media, your comparison group is eight billion people who are curated by an algorithm that is designed to give you the most anxiety infomo. No matter how well you’re doing, how much money you have, how well you’re living, no matter how happy you are, you can open up Instagram, and there is someone who is richer, happier, prettier than you are. Particularly for young people, it’s a very pernicious trap to get sucked into. That idea that your comparison group is literally 1,000 times bigger than it was for the ages. Richard Dawson wrote that book in 1907, I think it was, and he wrote about it in 1907, how so many of his rich friends in London were just trying to chase each other as well. It was just an arms race, a positional race of how they could do. That was true 110 years ago. I think if he had seen what was going on now, he wouldn’t have been able to fathom it. It is just so much harder now. You see that in the statistics of Gen Z’s mental health of their anxiety and depression and suicide attempts. It is way higher than it was in any generation that came before them. There could be a lot of reasons for that. But I think one of the obvious, the big ones is, no matter how well they’re doing, there is an infinite endless scroll of people who appear to be doing better than they are. But appear is the right word there because everyone knows that social media is a performance. You don’t post on social media, you perform on social media for other people. There’s a great quote from the philosopher Montesquieu, a real philosopher this time. He said this 300 years ago, whenever he was alive. He said, if you only want to be happy, that is very easy to achieve. But people want to be happier than other people, and that is much more difficult because we overestimate how happy other people are. That was true 300 years ago. It is way truer today.

Robert Brokamp: We have a few seconds left, but I just wanted you to talk very briefly about, you have a couple of kids, you write letters to your kids, and you say, in that letter, I don’t want to be harsh, but I hope you’re poor at some point. Why are you such a horrible father?

Morgan Housel: No, I think the only way to learn the value of a dollar is to experience the power of its scarcity. There’s no other way to learn about. I don’t hope they struggle. I hope they’re happy. I don’t hope they fall flat on their face. But being poor at some point in your life is a very important experience. There’s no other way to value it other than that. That was why I wrote that, and I’ll try to be less of a horrible father.

Robert Brokamp: You wrote that one measure of success you get is from Warren Buffet, and that is you hope that in your life, the people that you hope that love you do love you. Just to allay your concerns, Morgan, I do love you.

Morgan Housel: Thank you.

Robert Brokamp: I think everyone here loves you, too. Congrats on the book. Thank you.

Morgan Housel: Thank you.

Robert Brokamp: Tim you’re going to done Fools and it’s November, which means it’s time to start thinking about some end of the year financial strategies. I’ll highlight a few over the coming weeks. This week, let’s talk about a tax efficient way to make charitable contributions. Instead of donating cash, donate appreciated shares of stock for your brokerage account. That way, you pass the capital gain on to the charity, but they don’t care because a qualified charity doesn’t pay taxes. Then with the cash that you would have donated to the charity, you can just buy back the shares and reset your cost basis to today’s higher price. You can do it immediately. You don’t have to wait 30 days like you have to with tax loss harvesting. If you itemize your deductions on your tax return, you can also deduct the contribution up to a certain limit. Like all things with taxes, do additional research to make sure you do this right and it’s appropriate for you. But if you’re charitably inclined and have some big winners in your taxable brokerage account, I think you’ll find that donating profitable shares is the most tax efficient way to help make the world a better place. That’s it for this week.

Thanks so much for listening and thanks to Bart Shannon, the engineer for Today’s show who had to put this together while moving to a new house. As always, people on the program may have interest in the investments they talk about. The Motley Fool may have formal recommendations for or against. It’s an old buyer to sell investments based solely on what you hear. All personal finance content follows Motley Fool editorial standards, and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. Do see our full advertising disclosure, please check out our show notes. I’m Robert Brokamp. Fool on, everybody.