 I know that there was a meeting to go where Jack and Bill do back on the Marseille cat. There's nothing structured or anything, they can just go wherever it takes them. So we'll get out of the way and let's hear what's going to make Jack and Bill. I don't want to be off with a question for you, John, which is you gave us your expected asset last year. And with sovereign terms, you have a term, say, in four meter versions of the way it was sent. And you know that. And I know some of us are going to need conversion terms in the long run, but we're not serious. I'm going to ask you, Walker. Okay, well, first thing you can imagine, I didn't want to hear me say any more. I will say it out. But that's a good question. And that is what's different about meeting a version of the fund. What we have meeting a version of the stock is we have dividend yield, we have earnings growth, and we have what we get meeting a version is how much people pay for a dollar's earnings. In funds, if you hold them as investments, not as you hold them in speculation, that doesn't matter. Almost all of the long-term returns are counted for by the interest of the fund. It's 95% or only 100% of the long-term returns. Or, you know, again, so there is no need for a version. There would be a need for a version. For example, it could be to get a 30-year bond from 10 years. It's great to be hired over the last 20 years to go. I don't know how to predict that. So my own recommendation is I don't like long bonds. It's much way too much longer. It is quite clear that long bonds pay higher returns when you're meeting short because when you look at their yields, long bonds yield more. And so it's the only source of the return from the bonds that yield. That's what you get at the end of the period. But there shouldn't be any inversion in the short period. If you buy a new form to volunteer your bond, they will attend your return. More of us is more convenient. Why the total bond you invest on can interest rates scale from 3.5-4% to 10% to 10 or your return? It should be lower. Well, we have two factors. One, interest rates go up. The price goes down, as we discussed. It's only like the lunch and why. But the return on your reinvestment of those coupons goes up. And if interest rates go down, the price goes up. But the reinvestment goes down. There are more or less mostly wall-setting factors. So I think you can complicate things too much when we try and guess what happens in the short period, which it can. And then you get this money and timing thing. For example, if you buy this 10-year bond, it's only about 2.4%. But if interest rates go up 10%, the price of that bond will go up. That day, that week or that month, and the difference is in one half. Whether that half is on the first day or on the last day or on the month itself or on the last day or on the month itself. It only has one day. You don't have to insure it. So it changes to 10% in return. So we need to get those. I'm just this merchant of simplicity. And I don't know if we get a 10% interest rate, which is certainly possible. It happens quickly. You have one hand in effect. It happens in the middle of the period. And another, it happens at the end of the period. Quite another. So I just like to look at it and say, well, make the best judgment you can. I should also say this. If there doesn't seem to be any difference between that and the criticism. If you all need Treasury bond, or a Treasury bond, a corporate bond, you've got the same type of portfolio you've got. You can invest in one. Intermediate investment. Intermediate investment is shifting throughout its time. It goes out. That doesn't seem to matter. If you take a look at the actual Treasury bond return for that period, you can carry it with you on the fund. And the Intermediate fund, Intermediate Fund, Intermediate Fund, you can carry it with you on the fund. You can post it on the ground. So I think maybe we overthink it. Those loans are there. But I don't think we can afford that on the interest rates of over 10%. At a certain time, just critically able. Because you're going to go right. Betting on the time is too much. And the long run of that, the odds, the correlation, the day of the deal, the Intermediate portfolio, correlation over time, they're remarkably, I think I've got this chart. It's kept here. I think we have that chart on the new book, and we kept 191% correlation chart. And it's very, very consistent. And here's the initial interest rate. Here's the return of the next 10 years and I'll answer it like this. I would say it's taken a greater panel on this. So I think that's the best way to do it. It's interesting. What fascinated me was the chart we had run by decades. And enthusiasm versus non-thusiasm for stocks. And the commodity that struck me is, as I was coming out of it, I wanted to put that bookstore here and I thought it would come with an intersection around the H&K. As far as I was going to say, I did not find one book here that I would call an investment book. Welcome by you, welcome by Suzard, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, welcome by Schrodinger, Rich's wealth without rich, without high risk, Peter Lynch's books I think sold well. At a time when he was doing very well, I guess you're probably not doing so well now, and that's another Polish story in itself. Good example, it's got too big to do anything. A lot of my surprise, you know when a gentleman got to be under vision, it should have been an index fund, and they should have been saving all you guys but it was too awesome. But they got to work at the time and you would call that. And they got like a 25% cash position, and stocks kept on working for the manager going up. And just one more example, hey, can you handle a manager money in big size? And they shouldn't try it, they don't want kinds of funny things. And they're always late to do them, with going back, putting in your international end much after it's done its work. And it's a home for a few people, I can tell you this. We're going to look at the quote there, this I did, go off, again, 10 years ago. And put it out again 10 years later. Most of the books that were written 10 years ago were disasters. And people will go on, we're just, I don't know if people buy these books. I just hope they don't do what the authors tell them to do. But then what's the point of buying them books? I mean, one of my favorite methods of estimating the risk being that it's your method. The other method is I do a bookshelf with shelves. And when you, you know, see, get out $36,000, get out $50,000, get out $1,000,000, and those are filled with shelves, you have to be risk-free and expect risk-free means a lot. And then when you say, you know, what's the title of the Depression of 2015? How are we going to build a disaster? How about, well, you know what it's about? Yeah, but risk-free means it's very, very high. Let me just give you one second, though. You mentioned down $36,000, not exactly a brilliant exercise in more than four heads in a tiny book. And so Jim Blassman has written another book, and it's called Down to the New Testament. No, he has a new theory, that's called margin of safety. And he must meet it with an endorser. And I shouldn't say it's very negative, but so the idea that I'm going to go out is that I'm going to be a nice guy. I did endorse down to $36,000. But I said, don't be deceived by the title, we're going to get to $36,000. But it's going to be a long, long road and a very bumpy one. So I'm going to get to $36,000, so that may be $20,000. I don't know, $20,000, $30,000, I get it in the mail. But I don't think I'm going to endorse this one, I just don't know what I'm going to do. I think one of the great triumphs of human optimism is that people still don't use Jim Blassman. A triumph of hope over experience. Yeah, I don't know. The strategy that helped you out to vaccinate Jim Blassman was the dollar-weighted versus the time-weighted, GAF or the ETFs. And I don't know if you had these data, but I'm very interested to know, are the GAFs bigger for the ETFs than for the corresponding funds? If you take those granular funds that have no other classes, is the GAF higher for the ETFs than the Western Animal Fund shares? That's a very good question. I actually looked at it, and I said I don't use it short. Not because it does not show, it goes back to the show, it comes in stronger hands than the ETFs. But rather, we have some struggle to get in the numbers right, that the money goes out of the investor class and into the animal class. So it can be done, and Kevin and I are going to do some work on that. But you're an intuition, and in this case, I can choose to write, and in this case, look, it is write. This is the gap, and we've done this earlier, I said a couple of things about this, I'm going to end that off. Showing very clearly, the GAF is much more than the ETF, than being like the next one, than the ETF. We're going to get much closer, sometimes, to do almost exactly the same as the ETF itself. It's a regular fund, I had the same life as those, the other funds. But it's hard to calculate what's going on in ETFs, because that daily volume, just don't know if you have a measuring, how much money is coming in and going out. It's very hard to do, but you get a daily volume. It's an ETF that has a, I don't want to say a million shares, but we're doing that. We have no way of knowing whether it's a million purchases, or a million sales. It's a million volume, and suddenly, maybe, when I'm picking up, they'll have to equal, I just want us to be the marketer there. If it's a million sales, they've got to take it in, and let it out. If it's a million purchases, they've got to be investing it. There's no difference in how you do the volume. So are you still struggling with that? But I'm sure, I thought I was not showing you that chart, but I think that's the best we can do to illustrate this point. What happens is what I said this morning, I think it was a 270, a 275 fund, or all of those kind of numbers. I don't think we've broken that into this collaboration. Should the investors in this room get all worried that their strong hands are being disadvantaged by the weak hands that the ETIA process shows today? Well, in general, I think the answer to that is no. Those weak hands will give you aberrations in the market, as well as a particular clarity, maybe too much clarity in the flash crash, but at the end of the day, or the end of the week at least, and the emerges as well, as it's a flash crash, but you don't get cheers for that. You're just as well awed as you are ill awed as it is for that. Not as you work before the crash ever happened. It didn't matter. And the long run, those marketing imperfections don't matter. They're noise. There's all that's said on a tail-toe by an idiot, full-sand, fury, signifying nothing, quoting Mr. Shakespeare and slightly different stuff. On the other hand, there is something, and I worry a little bit about that, but I actually got a piece of data that I decided not to use this morning, but I'll give it to you now. And then I start to think about what's going on in emerging markets that are very popular. I think two of the largest and more popular black markets that I've made are the world of the emerging market. The emerging market culture in me are two of the five or six largest EDX, maybe two of them, and I won't go into that. But there, we found a 33% of all emerging market volumes in mutual funds, 33% of all of which were ETFs, and the ETF investors are traders, then that makes me worry. And I suppose it's on the hats of a bigger emerging market. I suppose it's on the hats of China. I suppose it's on the hats of Brazil, and the ETF people decided to get out. There could be a big gap, because of the market place, in poisoning that market, 30% to 30% free of market will be held by self-identified traders, if you will. And so the concern being that the ETFs donate in terms of holding any collateral. And still, in the long run, that should not matter, but if the ETFs, I'm sorry, the emerging market funds, are held up by my mutual fund demand, then they go, could make a permanent creation of the emerging market. I don't think it's going to do that. That's one thing I'm worried about, and I particularly think that we at Vanguard, as you can say, we at Vanguard, that should be very charitable by getting into these speculative funds and maybe focus on trying to, or our ETFs, for example, to imagine certain qualifications to the investment body to be in certain qualifications. And I wouldn't, in one day, I'd rather be here today to apparently disqualify the big one. 25 trades in that 26 month period. 25 trades in that 60 month period. I mean, really? Maybe 25 trades in your life. Maybe 25 trades in your wife and your life together. And the life of your children. And grandchildren. You would go on and on, but I... It just, it troubles me. It's not good for an investment pool, and it's not good for the big ones. This morning, a lot of our worst branding, at least, the ETFs, reversed this and that two times, up to two times, down to two times, up to three times, down. And I'm all alone in the Mexican market. And I seem to be losing my share. And a lot of our ETFs are in our business. I wonder about wisdom trade. They aren't doing very well. And there are probably health companies that we know how much cash they got left, and didn't much as a gallon. Didn't they have to raise a little bit? They did raise a little bit. At the beginning of the company, the ETFs only were violence. I like that a lot, yes. You know, I think that if I hear the term new normal for one more time, I won't be responsible for my actions. And I do this concept that that's, you know, the emerging markets are what it's at. Because that's what the economic growth is. You know, I think most of you know how I feel about that, which is that there's a reverse relationship between economic growth and and in stock exchange, the problem has to do with with pollution. And when people, you know, people talk about returning emerging markets, and the whole market, by definition, bubbles by definition, is a market where people only think about returning not risk. Twice in the past 15 years, the leading index of emerging market stocks has lost about two thirds of its value. And you can bet that most of the people who are invested in the world are not even wondering about the idea of emerging markets downfall, which has a significant impact. And it's also the idea of its biggest fund. And I may not also have the same problem. But one of the mentions, one of the, you know, I hope Steve Dunn doesn't get angry at me for this, but I think Steve demonstrated to me the proper response to the flash crash, which was, when Jeff was talking about, he went over to me and said, what was the flash crash? Sorry Steve. Yeah, but that's the right response. I'm not sure about that, but I'd like to say, if you don't mind the questions. Sure. Let's share something with you. Let me ask you, how do you size up the fragile regions that you should learn some next day to stop them off? I think... Don't think this is really bad. I was trying to grant you out, but I'm not here yet. In terms of radio channels, so I see real fragile regions on a per capita, on a per share basis. If you look at the shows there, there went out a percent and a half, you're lucky. You got two percent really, so that's really an half percent. When I look at bonds, and I wondered about real returns for bonds, I started to tremble, because I think that the view shows the best case scenario. I think that the four percent return from bonds with a two percent inflation, with a two percent historical return, I think that's the best case scenario. I think that in the worst case scenario, we could see real inflation not even forgetting about the fiscal analysis that we... We've seen falls in the bond market in the last several decades of the 50 percent on the warm up. I worry about that risk. So, my fault bond position is a very short trajectory that's going to be here, which has an expected real return of five percent. And I think that's acceptable, because I don't think it's going to be less than one five percent for very long. And I'm very afraid to take the risk of a spectacular long-term return if you buy bonds of the duration that you may wind up with nominal four percent return of the whole bond for ten years. Even if it's an average of a six percent or a nine percent of the return period of ten, you're not going to be happy with that duration. You know, I think that's the one on the short end. I don't see any other asset classes that really fall too far outside of that. Let me say a couple of things about real returns. The first reason we use two percent, essentially, is that's what the spread between the inflation hedge ten-year bond and the regular ten-year bond is the same market as well with two percent inflation. And very clear on the bill, I think it's going to be higher than that. And how much higher I'm going to avoid annoying. And of course, there's always this possibility of someone having a really big economic situation with a negative CBI for years, for four or five years. So don't take it to two percent because it's more of a float of fate. One reason I haven't spent a lot of time on this is that real returns compared to nominal returns is real returns take the same amount of all bond return between the stocks and bonds. Take the same amount of all bonds, three percent of the bond return, three percent of us and nominal return stocks and nominal return. So, you know, you're nobody to worry about by using, you know, nominal returns except to say that once you get, you know, you think about this and I think I wrote about this in a little bit of nonsense investing. And that is when you start taking these numbers down in real terms, then expenses really have impacts. You can take two and a half percent of a seven and I think we're using two percent inflation now. All of a sudden, let's just say a third of the return is consumed by inflation. And you take that five and it's half of the return is consumed by cost. I'm sure I've visited inflation before. I mean cost. And, you know, if you think about after cost it would take two percent of a seven and it should five take two and a half percent of a five that's two and a half. That's a hundred percent of the return you got and it just becomes just overpowering. I would say, I guess if I was smart I wouldn't worry about getting that person. I would always do it for you. Because the impact of cost is magnified, magnified, magnified and over again. Obviously the denominator is the same, right? The lower the denominator the bigger the impact on the same 50 percent of the figure it is. And then taxes again, you can do it with charts but taxes are a murder because you're named taxes not on the seven percent return but if you might get a seven percent return from the usual fund you get the five four and a half percent return and the taxes on that four and a half percent and that's one more big deduction changes the expenses of two and a half to three and a half percent so it's probably going to be a good idea to spend a lot of time on real returns and on honorable returns but I hate to scare people I don't want to do an old marketing thing and that would be we shouldn't scare people and we shouldn't think through all the reality because how much do I have if you know that if it's what's bothering me we're going to be using a lot of thinking and a lot of information as a difference between over a given period we're going to be doing a point in our area and the fiscal year but I don't really feel a lot of that bother me we're talking about a couple of articles and I'm not even going to else ask what networks we work on and basically this theory I think it's correct is that there's an influx of equity in the in the fiscal year so in the fiscal year let's say 1.4 percent of the long end right now but that's really higher than it should be because it has to be higher because of the equity problems and the equity shocks that you can have which we certainly saw during not very during the air crisis I mean during the crisis the long period of trying to absorb value and the long test I think the long test but I'll ask something that's 20 or 25 percent so it's a little pretty pretty interesting that numbers higher than it should be which means that the unresisting influx of equity lower than the high number is bigger than it should be then the high inflation is really much heavier this implies 2 percent inflation I think if all we're looking at probably implies really 3 percent inflation so I'd argue that 2 percent is is probably another estimate but we'll also you might want to comment on that how accurate is that question how accurate is it just ask what you're paying for if you're paying for years or you're buying long distances that's pretty a number and if you're buying health care loss of luck and if you're buying health insurance loss of luck the I think I had my new book I know I did but I can remember the number though comment that we made some substantial adjustments to the CBI and I think in 1982 and we had made those adjustments and the CBI with that very good version something like that and so we're again the victim of numbers which is what this book is a lot about it's a lot about inflation at the point what you're spending your money on and what it depends on a lot of things on politics and I heard in the radio that they had social security and they had no call-up this year there isn't any inflation by their measure well that's probably a long overdue because it kind of takes that system to the coldest part and this is like the stuff I'm happy about the only personal inflation rate is the sort of new news but that's also a problem I hope there are losses going on for a savings plan but we also want some comment I have always found that in fact when I was writing on December 1999 when everyone was involved with their 401k plan I've learned a lot from that the 401k plan is to give the bottle which is kind of the same and in the last year Time magazine had a cover story saying it's a time to retire the 401k plan retire the 401k plan I've always felt that it's ludicrous to think that the average intelligent person can save enough money and invest it wisely even with fraud and an intelligent man over a 60 to 70 year period it's just asking too much it's not that they are smart intelligent people they're not to be asked my question is how close are we to a system where it may be more like chillies or something where a person is kind of forced to save it's a combination of time, contribution combined private, defined benefit where somebody saves enough money and then they put it into like a single premium inflation just in the new where they're kind of forced to do that I'm not on how much emergency markets they have but how much they're saving and how that equates to drawing 30 to 40, 50 years down the road let me explain exactly that first of all you probably all couldn't say it better than yourself I mean I agree with everything you said I agree with our our 401k systems and you know the shift from defined benefit to finding contributions is a social struggle you know the basic my basic concept is the less all time the more the better the more trust you give them the worst thing you want to be for them so sure, force them to do all those things but why not put the money into a you can run pension plan that is perfectly transparent that doesn't even give you the option I'll do a toss I'll do a toss I'll do all of that and I'll go for a quick turn and I agree that a lot of people have signed up for the hard people who have had some better so it's well crossed so that all they had to do was say okay because I deal with this every day when people are done tell me how much they need to save I think there's so many others who can sell you rather moving parts and they don't really have people thinking about how much they need to be worried about so they need to be worried about is what our grandfathers and grandfathers were talking about and I think that's actually one of all the ideas too I don't think the ICU likes anything let me say something about the whole game and that is think about what it is and how discouraging it therefore is one, you're going to borrow money from two, when you change jobs and maybe when you don't change jobs you can just take all your money out and do whatever you want three, you don't have to make a contribution you shouldn't even go out four, your company can cut back your kind of future door limited whenever they want and they do that five, I guess no significant cost I hope the company is a long time going back I guess it would have been in the late 70s or early 80s when they started, it seemed like a national market where actually it turned out to be much more complicated than I thought and it seemed like it seemed like the ideal way to go to the index fund low cost over ever, right up our alley and it turned out that people wanted to go to the general fund for a 401k choice and you give investors their choices and that's what they do and now it's real fun to go to America and I guess the index is maybe third something like that not so bad there's too much junk money around there so with all those flaws how can it possibly lead to a comfortable retirement and the first thing you answer is look at the data it doesn't the average accumulation of the exact amount somewhere between $34 and $54,000 will have a great retirement investment in your friendly neighborhood will probably bring 1% accurate investment in these communities so if you've got $54,000 you've got 540 bucks a year it's acting gold in when you're getting your fender think about that so the way to improve it is to eliminate flaws it's actually weird enough not that far from what President Bush who never returns idea of 5,000 security into a neighborhood firm but it's basically a personal retirement plan 5,000 so you have your own your own candidate depending on somebody else talking about how much the payout is going to be and all that and you have your own plan or a property share or a contribution plan or a defining area without all the flaws and I'd like to leave it to the President because I know I need some sort of department to give you a sealed approval for eligibility to have your shares you can check out mutual matters and if you don't have the local and you're going to have my journal for a gap and you've got the sales book for those kinds of things so you've got 8 minutes but only because it is and what we know how many tens of millions probably 50 million people who have them have the blind contribution plans and that is if we leave them to their own devices they'll get the market return less astonishing costs and they really can't hold onto the market as we were saying earlier it's very hard to fail and so on an average return a huge cost and so that's just kind of unacceptable so you have to have some I think agency because they don't consider financing but say the use of the stands for getting in and then let people compete to have the best service and the best price and without all of it with rigidities and the free food the exercise is free will and that doesn't make you popular but we all know what the facts are and that's when you go very well and more choices you have and that's the more decisions you have the more flexibility you have with that one my favorite fact is that similar to your observation the last time I saw if you look people pre-retired in 1664 the average 401k balance was about 70,000 but the median was not 25,000 you know the average cost out-of-pocket cost for health care for the average Medicare city from 65 to my is a quarter of a million dollars Jack we focus on meal return then Jack said well yeah but you said look at stocks you suggested inflation there's just one other point with bonds bonds aren't going to go up with nominal price inflation at least for some chance stocks would all appreciate price nominal inflation there really is an ample price I guess I agree with Bill well man basically I agree with Bill too but I would say something about and we may go a little bit differently I'm not going to say real return the only thing you should worry about is the question is the integral of the equation inside where he gets figuring it out and then take them out there you both end up with real returns and so I think it's quite the same way as he did but it's very very problematic kind of thing to awaken investors to the risks of having how much money they have the time they retire and in a way the results are so discouraging if you look at return that's the one thing I don't like about money cross many questions they may take returns out just to give you a chart it isn't an actual worth table and in terms of the correlation between inflation and stocks I'd say two things pretty much one there is almost no correlation between inflation and stock prices stock prices do whatever they want to and if you want to find a correlation look over every 25-year period when I get at least a correlation that's not really what a correlation is about the inflation number looks like this and the stock return number looks like this and if you make that correlation you probably get a 0.20 or something there is or at least was I haven't done this yet and the total dividends can get some decline in dividends compared to inflation and for a long period of time the correlation that is they overmoved up gradually and without a lot of now so I'm going to notice why I mentioned this one the big decline in dividends in 2008 those lines look very much alike as a high correlation between corporate dividends or was at least a high correlation between corporate dividends and the CPI but virtually no correlation let's just check that correlation and and there is some more I think you can see this because we didn't get a 57% decline in cost of living with a market drop a 57% normally we get a 50% decline in a market drop 50% back in 1974 so I don't think we can find stock prices in the short term so heavily driven by motion but no long run it's crystal clear that stock returns driven by productivity dividend power earnings just one other comment which was if you remember back in the early 1980s in the 1970s people were turning those stocks because they were only yielding 6% but as a 6% yield I guess it's just not having steps to yield 6% so it's good to save this I just made my you're talking about stocks with dividends isn't it I didn't think all stocks paid dividends it's a beginner question here but I know there's lots of stocks that don't pay dividends so you're counting for that somehow well, all stocks don't pay dividends and we think yes, we do all stocks refuse to pay the actual dividends paid by all the companies and I would guess that probably 20% of corporations most of them are going to be on NASDAQ and office most of them are going to have short histories long histories and in the long run you know the value of a stock is a discounted value of its future cash flow there's no way around that the only cash flow you get in the stock is a dividend years ago a company came along and there's a growth company in the market and they probably don't want to get into that because it's long going and then they were on the card of time and they promised never to pay dividend we will never pay dividend this is considered an excelling point because they had the end of that one opening store and so we think they were out of business and the place was closed and anybody remember E.J. Forbett where is it now I haven't seen him around for a while it's bankrupt so dividends are an important sign of the management's ability to spend cash and I would argue I think managers are very bad users of cash flow they merge, they start new businesses and product lines and they seem to invariably fail and sometimes let's give you this little example sometimes because of the messed up nature in our financial selection investment system and one example comes to mind are the beleaguered and the MBIA has a lot of insurance and financial FSA has a lot of cash so you're going to get a lot of insurance for lots and of course Wall Street want them to grow 10% a year as a manager you can grow a 10% a year old and then you can so there were no more views for lots to insure so they were going to help the growth of the mutual fund and that's maybe as a one or two percent growth rate not really not we'll have to find something else to insure I've got an idea let's insure collateralize debt obligations and so they did and where are they now I think they're technically bankrupt except those municipal ones such a long tail and then they have a lot of litigation going on I don't want to get into this over my death but they separated MBIA into two things CDO portfolio and now they got litigation from bondholders they got them portfolios they got portfolios they didn't want they carved out the bank portfolio and they got an interest in that to insure exactly how it worked so I think mergers are done for the corporate ego corporate building complex and I gotta be a builder and imagine the CEO said I don't think we need to do anything probably 80% of the time that's what he should say but he can't he's got to improve on his process he's got to improve himself and that means doing something and he can say well I'm going to do a thing and it works they're saying what do we need you for so I said I'm not kidding really about this and then you start to play accounting games and make insurance and why the accounts haven't been old and I've gotten into more trouble about all this and then not quite as bad as the rating rating that's a pretty low bar isn't it do you really rely on corporate use of cash I know there's one more corporate motion that's what we're using for cash there is the one for you the economy grows productivity grows at 2% that's one of the constants of capitalism and development economy for China shouldn't 5%, 6%, 8%, because you're catching up in technology if you're in the leading edge 2% is the criticism we get another percent in this country for violations 3% when things are going to go long that's not what you see when you want to share a stock the stock's going to be a shareable or 2% so it's 2% more shares that have years to that or a share indicator only grows at 1% or 1.5% what CDL the share of the board is going to go before its shareholders if you want to grow our earnings on a shared basis don't you just love me I grow 10%, 15% and when you get 10%, 13% growth you start really doing good things and losing it the best example I can think of I think there's all sorts of data and finance that we're sure you don't know about that basically says that corporations have to fund their projects externally in public bottom line in public that they tend to do pretty well but when they take the capital internally it's not subject to this they take it from their cash flow or their cash pack that these projects do very, very important because they're not subject to the same discipline finally the best example that I can think of is we now have a 30-year 40-year track record almost on real estate investment trusts on real estate investment trusts and the return on which it's only the past 40 years I've gotten my facts straight are about a percent or a percent and a half higher than the overall market why? because we have to distribute out 90% of their earnings in public to the shareholders alright and the shareholders get to decide how to collect that capital and not the company and that's why they do that and let me add that I've seen this happen on a record in a large paper company now go on and it's about so I saw this happening and when I finally concluded after a long period of experience in the work it took me a long time to learn what was all about learning how to behave as a broker but I've had a lot of things one investment factors Wall Street is always wanting to do a deal so they come to the company and say I've got a company for you and they give you all this paper and they look at it and so they look at a lot of numbers for the deal and they don't know very well so the problem is there are dealers and dealers who might get into companies and then there's waiting companies to do something not because we'll increase their growth because when they put the two companies together they will get synergies so there might be hundreds of millions of dollars a year of synergies without which the numbers won't work and you say this will be non elusive maybe even a credo then the world believes you you can bring out all these numbers but the appreciation is because of these synergies that hundreds of millions of dollars and then the deal is done and we wait for the synergies to come and they don't renounce themselves like say I call them I'm in with a slain a tiny brand here you know it's a kind of day by day thing and other things happen and the synergies as far as I can see never happen in any life so and those two things could be odds on any amount of order as I said because it's more than sixty-two percent sixty-five percent but these kind of acquisitions and calculations fail it's all in turn it's also a buy for people to do something because there are limits limits on what you can earn on capitalism competitive markets is capitalism and it's all harsh unforgiving market and corporations shoemakers will step to their last as I said back in the days when there were shoemakers wanted only like this but these corporations think they can do all things for all people and I just don't think they can do that and it's just more of a reason that the history of investing on capitalism is why sophisticated long-term investors can realize that all they're always going through is trying to buy companies that they're going to grow smartly we just bought a company that steps through the day and it's like if you were to buy a company and then you get to the side of the business it's a lot easier to buy a company and then cook a books and then you get balance sheet where it's not to fool you about this but it's good to have a company all the time on the other hand if you're not sticking to anything but trying to diversify it's hard to start business and to say you're married that's why I think it's easy to have a company that's worth a company that is very good at one thing that's the story that Google is getting and spending roughly $5 billion to create these companies because they've decided that they want to be good to be not good to be kind but good to be hired so they've even got a company that if they get all this cash on again in my opinion they're not ready to do that yet so they're diversifying now it's just the end they're also in another business that we should name it and that is they have a car that drives perfectly well without a driver and we're not these laws I'm not sure but it's parading around out there they have somebody sitting in it just in case they're also coming up with their own inflation index too I'm not sure well, I think it's time to wrap up and we're going to get to the book signs there's a book sign for us so I thank you all and I guess we'll turn to the book sign thank you again for all the attention you gave me today and I'll leave it to you again because you're going to be all bowed out for another hour and a half of the time it's not in the book out there it's the first 150 copies that we have and also I can only do a signature it's just too many people that I mess with but I don't want a signature I'm ready to weigh it up and do that and then if we have a limited number of copies we're going to ask a few people who have stops here we'll only take one for the panel so if you have a bad game about that and each copy of that it's your own book that's probably the 1895 it's the sign of the month and if you get one free that's only going to the judges' prices it's 9.15 so thank you again and again to make a band or an activity and you know, family members and I don't have any more I'm going to get 7.30 I think there's a lot of people I'd love to hear it today I'm going to show you all what you can take for free and interesting so thanks and let's go sign