 Hi I'm James. And I'm Anthony. And this is Words and Numbers. How are you doing, Ant? I'm doing well, James. What do you know? Actually, before we get started, I should tell people that if you're interested in any of the things we talk about today, be sure to click on the top right hand portion of the screen. You'll see a little I there. And if you click through, you'll find some of our sources and our data. But today, the sources and data are going to be about all kinds of stuff, right? Creative destruction and automobiles and horses and buggies, all these good things. And I kind of got started thinking about this just recently. When I went out and I bought a car, and you know, it's been a lot of years since I've bought one, probably 10 or so. And I thought to myself as I was buying the car, this is probably the last car I'll ever buy that I drive. Right. And then I started to think, you know, this might actually be the last car I ever buy. And that leads us to some pretty, it leads us to some pretty interesting things to talk about today, doesn't it? Am I ever going to own a car again? Yeah, that's a good question. I don't know. I would go so far as to say you might, you might own one more. But I think that's it. I think what we're going to see, I mean, if you look around, one of the things that the economists like to look for is is idle capital, you know, stuff that people have invested lots of money in that sits around not doing anything. Because if you can find some idle capital, and then figure out how to make it not idle, all of a sudden you get more productivity without investing any more money. And cars are an interesting example of that. Yeah, right. Very few things that I own cost more and are useless. Right. So the average number is people, people use their cars about 5% of the time that they own them. 95% of the time that asset is sitting there doing nothing. Yeah, that comports pretty well with what I observe on a day to day basis, right. But when you think about it, this idea that A, I might not own cars at all, or B, and somewhat before that, I might never drive a car again, it kind of points us to the role that technology plays below the surface on a day to day basis in our lives, right. Because maybe the biggest change in in American even world life in the last 100 years or so was the switch from horses and buggies to automobiles. Right. If you think about all the things that came along with that, all the other secondary things that were changed and impacted, it's really quite something when you think about it. And we might be poised for that kind of change again. Yeah, and I don't think people understand the magnitude of that change. We talk about cars replacing horses, and you can imagine in your in your head, horses disappear, cars up here. But there are tens of thousands of jobs associated with that, right. It's not just the people who breed the horses or care for the horses. It's the people who make the leather equipment. It's the the people who shoe the horses. It's the guy down to the street sweepers who sweep up after them, right. In fact, in New York City, there was an entire, you know, set of jobs for people who would come along and pick up the dead horse carcasses from the street and get rid of them, right. All these jobs completely gone with the with the advent of the automobile. And there I was thinking that the guy who had to shovel up all the horse dung had the worst job in the world. Turns out no. No, apparently not. And I don't know how these things go. But at least looking at old pictures, I never see a license plate or a VIN number stamped on the horse. So if your horse dies, nobody's looking, you just walk away, right. Who's going to know that it was your horse? Right, abandoning a horse carcass. That's just fantastic. But you know, when we think about it, this is the great quintessential example, right. But as I thought about this sort of thing the other day, there are all kinds of other ones, smaller ones, you know, and I was I was led to remember how ubiquitous blockbuster video was once upon a time. Right. Now, absolutely gone. There were 9000 blockbuster stores. 9000. Crazy, right? And then as as if by magic overnight, utterly replaced by things like streaming services and red box. And you think about this a little more. And there was an entire industry devoted to the repairing of typewriters. Yes, well, obviously, those guys are all out of work now. Photo developing shops. People young people won't remember this. But there was a photo developing hut in every parking lot of every shopping center in the United States once upon a time. Yeah, a little just a little thing you drive up to it, you give them your film, pick up your developed pictures. Right. And when you think it through, right, these things all disappeared for perfectly good reasons. They became unnecessary. People didn't want them. I mean, you could still get photos developed, but not to the degree that it once was. There are still places you can go and rent a DVD family video comes to mind pretty quickly. But there there are a drop in the bucket compared to what once was available, right? Technology comes changes things and we adapt. And in the bargain, we're actually happier and better off for it. One of my great, one of my favorite examples is travel agents. You know, when I was a kid, and you were planning a trip somewhere, you'd call up, you know, the travel agent and they'd make the bookings for the airlines or if you're driving, you know, they give you the map and circle, here's where you start, here's where you go, here's where you end up, they'd hand you the map, this kind of a thing. And now, you know, you've got, you know, orbits and, and, you know, Google maps and all those jobs have largely disappeared. Orbit really? Well, whatever it is you use, right? I'm a Southwest. I kind of booked. I'm like a crazy person. I direct, I book directly with the airline. Right. But you know, but this is, this is happening right now in the news. One of the big things going on is retailers across the country are shutting down retail stores. And what's going on largely a lot of people, myself included, will go to the retail store to look and see to pick up the product I'm thinking about buying. But when I'm ready to buy, I don't buy from the retailer, I buy from Amazon or eBay. Yeah, no, I do exactly the same thing. And retailers are really feeling the pinch. And you start to wonder what's going to go into those spaces that the retailers are walking out of, right? They're not all going to be restaurants and bars. But they will be something. And that's going to be interesting. But, you know, when we think about these things, typically our mind goes to the latest thing, right? And the latest thing is, is Uber and the disruption that that's had on taxi cab services in city after city across the United States. And what do you see, right? You see local governments coming down hard on Uber and Airbnb fits here too, in order to protect, to protect industries that pre exist Uber. And what does that mean? Well, that means they're protecting their friends who they've regulated and given medallions to and permission and on and on and on. But now we're at the very strange place in time, where even Uber is likely to be destroyed in its current incarnation, right? Because if driverless cars hit the road and Uber's got them on the streets of several American cities already. When driverless cars hit the road through Uber, Uber has itself undermined its own business model, right? Yeah. And it goes even further than that. It's not just it's not just Uber, you're going to see changes in how car loans are made because fewer people are going to need cars. They'll just be out there and when you need one, you summon it and it comes. So there's going to be fewer car loans, there's going to be people building houses without garages, for example. Yeah. No, right now, I mean, I don't think people realize this, but automobile loans are the third biggest kind of loan in the banking industry in the United States right now, after mortgages and student loans. So the entire banking industry is likely to be upended in some meaningful way when we all stop purchasing cars. But then it goes further than that, because once we're all in self-driving cars, DUI laws, for example, become kind of superfluous, right? And it's not just a DUI laws, but think about it, there are industries of legal services, social services, and law enforcement that have all grown up around the existence of those laws. And all of a sudden, all those jobs are going to start to disappear. Yeah, that's right. And I think that's one of the salutary benefits of a driverless society. There will be no more problems brought about by drivers. Not to say there won't be problems, there will be, but they won't be brought about by drivers. Yeah, I agree with you, but I'll make a prediction as to how this is going to go down, going back to your point about how government protects the businesses that are there now. What's going to happen is with the driverless car, there's going to be far fewer DUIs, and so all of a sudden you're going to get police out of work. We don't need as many as we did before, the social workers out, the lawyers are losing clients, all of this. So I guarantee you, what's going to happen is going to come in the name of public safety. The law is going to require that the person who's in the car, not driving it, just sitting there, this is a self-driving car, the person who's in the car may not have a blood alcohol above the DUI level. Why? Because it might happen that the person would be required to take control of the car. Now, that we can see right now, 20 years from now, that's no longer the case. The technology will be so advanced that the driver won't be able to take control, and yet I guarantee you that there'll be pressure for that law to remain just to protect those jobs. I'm actually more interested for obvious reasons in thinking about all the benefits here, right? Thinking about not having to find parking in a major American city, right? Never having to wait in a traffic jam. I'd rather think about these things because my mind typically goes that way when I think about technological advance, but I think ultimately and sadly, you're right. Government will find a way to keep its thumb on the scales here, and it will likely make things worse rather than better. And it's able to do that because we can all point to the jobs that we're going to lose. I just made a prediction of three. I know I'm right. Three industries are going to lose significant numbers of jobs because of driverless cars. We can see the jobs that are going to disappear. What we can't see are the jobs that are going to appear because of the new technology. And those jobs are going to be better. They're going to be more numerous. They're going to be more lucrative than the jobs that disappear. The difference between them is we can't anticipate what they are because we can't anticipate how entrepreneurs are going to find interesting ways to use the new technology. If you want an example, go back to the era of the horse when the automobile was first invented and ask someone to imagine all of the businesses that will arise because of the replacement of the horse with the car. And I guarantee you no one would have imagined drive through McDonald's. It's just completely foreign. And yet look at all the teenagers we employ to work the windows through drive in McDonald's simply because of the car. Right. And if we can't, and this is what people should remember, if we can't legitimately predict what will happen, government regulators can't either. That's absolutely right. And so when we ask them to regulate to protect these jobs, we're literally asking them to do something that they are completely incompetent to do. Not because they're dumb, but because it's just not possible. And on that happy note, that's all we've got time for today. Thanks for watching this episode of Words and Numbers. And feel free to leave a comment or God help me. Click the subscribe button below. Come on back every Wednesday at about noon, give or take, because you know how these things go for a brand new episode. I'll see you next week. Can't have a good one. See you next week, James.