Passive investing, AI, capital over labor, ETF mechanics, and why the future of markets may belong to people willing to study the plumbing instead of worship the narrative.
Great interview! Green’s point about passive flows distorting price discovery lines up with what I see in momentum tests, signals get noisier as trend strength gets mechanically reinforced. Not fatal, but you can’t assume old edges survive unchanged.
Thanks Devon. Yeah I’ve been challenging myself since that interview to find a credible counter case but I’m still coming up empty. Physics is real and these passive flows as definitely a force to be reckoned with and accounted for within the market structure.
I hope you’ll tune in tomorrow to the ATOMIQ LEVEL live with Charlie Garcia and weigh in on the comment feed because I plan on giving myself a brain bleed with him;)
I'm following Mike Green for some months now. Learning a lot. However, every time he talks about his reflections on society and its shortcomings, I wonder why we have so many capable brains designing algorithms, financial instruments etc. instead of having them work on a better real world or better social contracts.
The whole financialisation of the economy has gone way to far. Yes, we need some tools to hedge risk for real economy players etc. But losing all the physicists, mathematicians, engineers to finance is a waste for society.
And yes, self-interest is driving progress, but self-interest increasingly being limited to getting rich easily by financial betting, has taken a wrong turn.
I'm from Germany and often complain about the economic and financial illiteracy of my fellow Germans. But, watching the sheer amount of financial advice, good or bad, in US-related social networks seems to overdo it in the other direction.
M Housel: "The highest dividend money pays, is controlling your time." Use it wisely, since there is more to life than adding another zero to one's net worth.
Well, to me time is a present we get with our birth. The price of controlling it depends on the other birth’ day presents (class, caste, expected inheritance, …) and our wishes. The less of the former, the more of the latter the likelier bright brains end up in finance.
(Still that doesn’t mean the system is good for society.)
Like the old saying “don’t hate the playa hate the game “ , or just recognize it’s one game but not the only one worth playing or beating and often the more meaningful games and levels require beating this game first.
Yepp. From a societal perspective we should strive for a system with meaningful games only (for individuals AND society; E Musk in his business endeavours seems to be the role model). Won’t work because the brightest brains always find a way to game the system…
What we think about we bring about and our collective thought energy is the most powerful force in the universe. Focus on the outcome you want. Worry isn’t productive it is just the fear of future anger. The real risk is doing nothing ;)
StoertBekker Thank you for listening so thoughtfully, and for taking the time to contribute to the discussion. I actually think you’re putting your finger on one of the central tensions of our time.
One of the reasons I always close my opening by saying that this show exists to help people protect their net worth and their net happiness is because I don’t believe those two things are synonymous.
Net worth is relatively easy for someone else to measure. An accountant, a banker, or an app can estimate it from a balance sheet.
Net happiness is different. Only you can measure it. It’s an internal ledger that belongs to your conscience, your relationships, your sense of purpose, and ultimately your soul.
Ironically, as AI and machines become increasingly capable of optimizing productivity, they still can’t experience the feeling that makes human work meaningful: the satisfaction of creating something valuable, solving a real problem for another person, building a family, serving a community, or leaving the world a little better than we found it.
That’s why I spend so much time trying to bridge what I call the financial economy and the real economy. Finance should exist to serve productive human endeavor—not become the destination itself. Capital is an extraordinary tool when it helps entrepreneurs, builders, scientists, engineers, creators, and families compound their impact. It becomes far less healthy when the game becomes detached from creating real value.
I also think that’s why Morgan Housel’s quote resonates so deeply. Money’s greatest dividend isn’t another zero on a statement. It’s the freedom to spend your finite time on work, people, and causes that give your life meaning.
If Wealth Matters can help people preserve both their financial capital and the happiness that gives that capital a purpose, then I think we’re measuring success the right way.
Thanks again for being part of the ATOMIQ LEVEL conversation. Comments like yours are exactly why I love doing this.
This is the line that has me pausing the most “I think some clever politician may play the ‘fascism with a 401(k)’ card as the new (tarnished) universal.” We are heading toward a true barbell existence where our economic reality is “the real economy” on one side and the “financial assets economy” on the other end and we are left trying to make sure we have enough “wealth utility” in each of those poles, while we simultaneously live in a fully automated and exponentiall digital pole with a core part of our personal and professional public identities and edge personas, while we fight harder and spend more intently with our disposable time and income on the opposite fully analog, private (what can be left of it), and most dear or intimately personal edge personas and real identity. The middle will be a vast wasteland of incomplete and unmaintained endpoints that we abandon if they don’t fit into our workflows and/or unplugged daily habits. I also think our personal time and thought energy will be spent mostly on organizing and amplifying the analog experiences and richness while we train our AI agents to manage and oversee the workflows of our digital lives.
do you have a YouTube channel for this video? the substack player is absolutely garbage and I can't get back to where I was in the video without completely starting over
Thanks for listening and also for letting me know. I have it on every platform I can for these reasons but we always drop the exclusive live and first look to my Substack family
I stumbled on your page because of my ability to follow all things Michael Green, but you got another follower today! Keep up the good work.
I am grateful for that and hope you will enjoy more of the amazing interviews and article archives and keep giving me feedback
Great interview! Green’s point about passive flows distorting price discovery lines up with what I see in momentum tests, signals get noisier as trend strength gets mechanically reinforced. Not fatal, but you can’t assume old edges survive unchanged.
Thanks Devon. Yeah I’ve been challenging myself since that interview to find a credible counter case but I’m still coming up empty. Physics is real and these passive flows as definitely a force to be reckoned with and accounted for within the market structure.
I hope you’ll tune in tomorrow to the ATOMIQ LEVEL live with Charlie Garcia and weigh in on the comment feed because I plan on giving myself a brain bleed with him;)
I'm following Mike Green for some months now. Learning a lot. However, every time he talks about his reflections on society and its shortcomings, I wonder why we have so many capable brains designing algorithms, financial instruments etc. instead of having them work on a better real world or better social contracts.
The whole financialisation of the economy has gone way to far. Yes, we need some tools to hedge risk for real economy players etc. But losing all the physicists, mathematicians, engineers to finance is a waste for society.
And yes, self-interest is driving progress, but self-interest increasingly being limited to getting rich easily by financial betting, has taken a wrong turn.
I'm from Germany and often complain about the economic and financial illiteracy of my fellow Germans. But, watching the sheer amount of financial advice, good or bad, in US-related social networks seems to overdo it in the other direction.
M Housel: "The highest dividend money pays, is controlling your time." Use it wisely, since there is more to life than adding another zero to one's net worth.
Oh, and THANKS for this great talk.
You perhaps described why there are smart people in finance — it is the price of time itself
Well, to me time is a present we get with our birth. The price of controlling it depends on the other birth’ day presents (class, caste, expected inheritance, …) and our wishes. The less of the former, the more of the latter the likelier bright brains end up in finance.
(Still that doesn’t mean the system is good for society.)
I also view it as a gift. But can simultaneously acknowledge that it is a gift of an infinitesimal fraction of what the universe has to give.
A physicist's answer 😉
Like the old saying “don’t hate the playa hate the game “ , or just recognize it’s one game but not the only one worth playing or beating and often the more meaningful games and levels require beating this game first.
Yepp. From a societal perspective we should strive for a system with meaningful games only (for individuals AND society; E Musk in his business endeavours seems to be the role model). Won’t work because the brightest brains always find a way to game the system…
What we think about we bring about and our collective thought energy is the most powerful force in the universe. Focus on the outcome you want. Worry isn’t productive it is just the fear of future anger. The real risk is doing nothing ;)
StoertBekker Thank you for listening so thoughtfully, and for taking the time to contribute to the discussion. I actually think you’re putting your finger on one of the central tensions of our time.
One of the reasons I always close my opening by saying that this show exists to help people protect their net worth and their net happiness is because I don’t believe those two things are synonymous.
Net worth is relatively easy for someone else to measure. An accountant, a banker, or an app can estimate it from a balance sheet.
Net happiness is different. Only you can measure it. It’s an internal ledger that belongs to your conscience, your relationships, your sense of purpose, and ultimately your soul.
Ironically, as AI and machines become increasingly capable of optimizing productivity, they still can’t experience the feeling that makes human work meaningful: the satisfaction of creating something valuable, solving a real problem for another person, building a family, serving a community, or leaving the world a little better than we found it.
That’s why I spend so much time trying to bridge what I call the financial economy and the real economy. Finance should exist to serve productive human endeavor—not become the destination itself. Capital is an extraordinary tool when it helps entrepreneurs, builders, scientists, engineers, creators, and families compound their impact. It becomes far less healthy when the game becomes detached from creating real value.
I also think that’s why Morgan Housel’s quote resonates so deeply. Money’s greatest dividend isn’t another zero on a statement. It’s the freedom to spend your finite time on work, people, and causes that give your life meaning.
If Wealth Matters can help people preserve both their financial capital and the happiness that gives that capital a purpose, then I think we’re measuring success the right way.
Thanks again for being part of the ATOMIQ LEVEL conversation. Comments like yours are exactly why I love doing this.
The real risk is doing nothing! Chris
Analog is the new luxury. All others get AI.
Tribal validation is the natural response to universal nihilism.
Institutional death births local/regional rebirth.
When the magnificent thunder of the center cannot hold, the quieter comfort of the small, still pool must suffice.
The universality of the small, the knowable, the familiar replaces the hifalutin enlightenment fancies.
I think some clever politician may play the ‘fascism with a 401(k)’ card as the new (tarnished) universal.
It’ll be a bumpy ride for sure.
This is the line that has me pausing the most “I think some clever politician may play the ‘fascism with a 401(k)’ card as the new (tarnished) universal.” We are heading toward a true barbell existence where our economic reality is “the real economy” on one side and the “financial assets economy” on the other end and we are left trying to make sure we have enough “wealth utility” in each of those poles, while we simultaneously live in a fully automated and exponentiall digital pole with a core part of our personal and professional public identities and edge personas, while we fight harder and spend more intently with our disposable time and income on the opposite fully analog, private (what can be left of it), and most dear or intimately personal edge personas and real identity. The middle will be a vast wasteland of incomplete and unmaintained endpoints that we abandon if they don’t fit into our workflows and/or unplugged daily habits. I also think our personal time and thought energy will be spent mostly on organizing and amplifying the analog experiences and richness while we train our AI agents to manage and oversee the workflows of our digital lives.
do you have a YouTube channel for this video? the substack player is absolutely garbage and I can't get back to where I was in the video without completely starting over
Yes although in the substack app the player always pauses and renews where I left off in the content I’ve watched or listened to.
But as a backup yes the videos are dropped here as well and this one is up or processing https://youtu.be/VpNPQpHJdAU?is=SlsF1bN8tte94F6U
Same here, normally it's fine but bugging today and wasn't clearing with a reboot. Oh well, thank you Chris for the link! Regards Sir.
Thanks for listening and also for letting me know. I have it on every platform I can for these reasons but we always drop the exclusive live and first look to my Substack family
It's incredible when you really step back and look at the whole thing...
@Garrett Baldwin its mind boggling. Like a 450 pound toxic tumor in a 500 pound living man. There are no quick easy fixes.