The Everywhere Millionaire

 

Hot off the press after coming back from the Cameron Highlands, I've been reading this cool book by Zidar and Zwick called The Everywhere Millionaire. It continues a line of books that began with The Millionaire Next Door by sociologist Thomas Stanley, and this time it's written by economists armed with lots of government data.

When you use data to figure out what millionaires are actually like, you risk the insights not transplanting into another society like Singapore.

The only thing I found useful is the millionaires' affinity for mischief and rule-breaking as kids, which I also observe among Singapore businessmen. I find this isn't sufficiently emphasized in local business literature; sometimes you need a level of non-conformity to do well in entrepreneurial pursuits.

Another point the book keeps repeating is that rich, successful millionaires all use some kind of pass-through tax instrument to make their money. These are similar corporate entities like Sole Proprietorships and LLPs in Singapore. It works because, as it turns out, large corporations face much higher tax rates than individuals, so companies that use these pass-through instruments can achieve massive tax savings, even though these rates are astronomical compared to Singapore figures.

The book then explains why these tax loopholes are maintained by the same wealthy people through political lobbying via PACs, or Political Action Committees, and the book frames one of the biggest problems in America as that these millionaires can use their wealth to influence political outcomes that seem to help "small businesses" at the expense of the American consumer, like blocking corporations from cutting out the middlemen to sell cars at a lower price. 

In such a case, I'm more reluctant to condemn American business lobbyists or the inequality inherent in their system.

Starting a business is a high-risk endeavor, and failure rates are high regardless of where you do it. Maybe America's strength is that business winners eventually gain the privilege of maintaining their wins through political lobbying, encouraging constant entrepreneurial risk-taking. 

Maybe as Singaporeans we should not be too hasty to judge.

But I do wish that NUS or NTU would perform a similar study in Singapore. 

Without the data, my intuition is that our local millionaires are mostly the folks who own landed property and real estate along Bukit Timah Road, or those who run legal and medical practices in Singapore.

Do you think a similar study in Singapore would be controversial?

My trip into the mountains to study Existentialism and what it means for the FIRE movement

 

Something got into me during the semester holidays. After conducting my Early Retirement Masterclass and teaching a semester of both Law and Data Analytics, I told myself I needed to head solo into the mountains to study existentialism.

So last Saturday, I crossed the Causeway, took the ETS to KL, then spent a day meeting students and relatives before taking a 5-hour bus to Cameron Highlands with a book on Existentialism. In Cameron, I tried two approaches to enjoy the place. The first was an intense one-day tour of the area that covered about 80% of what I needed. The second was a day to recover from the first, where I just hung around Tanah Rata and went where my nose led me. 

As a result, both extremes don't really suit me, and while I finished the book, I still couldn't really understand what Existentialism is all about.

So this article is my attempt to reflect on the few Existentialist concepts I was able to grasp in my solo travel, which I hope the reader will appreciate.

So the basic notion is that we can't really choose our circumstances when we are born. We have a starting hand in life, and we also inherit social expectations from the people around us, societal norms, and built-in behavioral biases from fields like evolutionary psychology. 

But we are not bystanders; we have to live, so some of us take up careers, buy things, and pursue status, all to impress people we may not know or like, just to conform to society. People should do this; you must act in a particular way. Chinese New Year is like an audit where you are ranked in personal achievements relative to your cousins.

Conforming and being conventional is okay, until you realize our time in this world is limited. When you conform to others' or society's expectations, you aren't really taking the time to do what you really want, and existentialists see this as acting in bad faith. So does it make sense to be a walking resume and just be the kind of cousin that gets all the accolades during CNY?

So how should one live? 

First, you need to understand that you are in this prison-like situation; then you need to take ownership of your life. Make choices for your life despite these societal constraints. This is what existentialists say is being authentic. 

I see many of these concepts in practice as I travel solo. 

When I travel alone, I don't need to consider the needs of fellow travelers, so I can do what I want, but only for the short time I have before I return to Singapore. But this freedom comes with some anxiety. So, I have to make different choices about the trip's intensity and figure out which itinerary I prefer. Like A/B testing. The intense day trip was physically uncomfortable, but I saw many things and even made new friends on LinkedIn. The day I did nothing was blissful, but I felt vulnerable to FOMO. In the end, I was just happy to see my cousin so that I could bitch about my trip over a cup of Teh Halia.

I've always had an inkling that Existentialism will play a major role in the FIRE movement.

Once you attain it, financial independence will give you a lot of optionality in life. I've dedicated more than two decades to pursuing and then teaching it. But an existentialist will laugh and say that financial independence is just a beginning and not even a person's final form.

Optionality gained from financial independence should drive more agency in life. 

If you don't have to work anymore, what would you do? 

Whatever you do needs to have meaning because your life is short. So retirement may be acting in bad faith because RE is already built into FIRE by definition. 

Why should you retire just to signal that you've gained financial independence?

Mirroring a concept in philosophy, when you gain financial independence, you've just begun existing in Singapore society.

Existence precedes Essence. 

There is fundamentally no new meaning in your life just because you can live off your investment income. I used to call FI a person's Financial Nirvana, but an existentialist will disagree.

But now, with your new financial power, you need to exercise your agency to break away from the notion that you are working for money. 

Life is too short to work for money after you have money.

Without a clear definition or meaning of life, existentialists believe that people now have the freedom to choose a life path that gives themselves meaning.

So this is the glide path for folks who gain financial independence. 

First you can get enough income without work. Since you are no longer confined to the social expectation of having a career, you might need to find what kind of work, or non-work, gives your life meaning. 

Then you do it. 

You gain authorship over your own life.

If, after much introspection, you still want to retire early, so be it!

So I'm at the tail end of my trip now. I hope to get back to my mundane existence in Singapore tomorrow. I think I've gone too far bringing such a dry philosophy book with me into the mountains. 

I will limit these projects to perhaps just once a year. 

The phenomenology of Financial Independence

Before arriving in Cameron Highlands, I took a 5-hour bus to Kuala Lumpur and pushed through a book titled At the Existentialist Cafe by Sarah Bakewell, which made a valiant attempt to explain existential philosophy. I found a section on the eccentricity of philosophers interesting, after struggling to learn anything.

I guess if I can understand just a tiny part of the book and can apply it to my work, it's a small win, and I can come back from the mountains a satisfied guy.

So the concept I struggled with was phenomenology. It is a particular way of looking at something from a viewpoint other than facts. So when you practice phenomenology, you describe a phenomenon. Take, for instance, coffee. Phenomenology is not about the chemical composition of coffee or how many stages coffee beans need to go through to become the cup of coffee you have today. The phenomenon of coffee is more like its rich aroma filling your nose just before you drink it, and the feeling of drifting out of your stupor as you get your first caffeine hit.

So naturally, I have to apply this newfound skill to understanding what financial independence is; it's certainly not about the current yield of your investment portfolio, but what freedom means for people whose passive income exceeds their expenses.

But...Who am I kidding... AI can do the job better than me. 

This is what ChatGPT said:

Financial independence is not merely a numerical condition in which passive income exceeds expenditure; it is a transformation in how a person experiences time, work, risk, and choice. Before financial independence, time is often structured by economic necessity: work schedules, income requirements, debt obligations, and career incentives shape the horizon of everyday life. Financial independence loosens this structure and creates greater temporal autonomy.

Phenomenologically, this shifts from constraint to optionality. Work is no longer experienced primarily as an obligation imposed by financial need, but as an activity that may be chosen, modified, or abandoned. Decisions can be evaluated less by their immediate monetary consequences and more by whether they are meaningful, interesting, or consistent with one's values.

Yet financial independence does not automatically produce fulfillment. Removing financial necessity can also expose questions that employment previously concealed: What is worth doing when one no longer has to work? What provides structure, identity, recognition, and purpose? The experience can therefore contain both liberation and disorientation.

The deeper significance of financial independence is consequently not freedom from work, but freedom from economic compulsion. Its value lies in expanding the individual's field of possible action—the ability to decide how one's finite time should be spent rather than having that decision largely dictated by the need to earn an income.

Wow ! 

That blew my mind.

Even if you think it fundamentally states the obvious, phenomenology allows the user to isolate intuitive, human emotions from something, which I think can apply to marketing, or at least to motivating people to achieve financial independence. This is certainly consequential because I'm more than happy to couch financial independence in such terms when I create content.

Of course, to leverage AI at this level, you need to put in the effort to understand phenomenology—that is a tall order. 

I also find that in Cameron Highlands, I have to study every single influence on existentialism. Now I'm grappling with Martin Heidegger's ideas, and I'm so lost that even AI can't really take me very far. I know it has some utility in the FIRE movement, but it remains too abstract for me.

 Maybe I'll be more enlightened tomorrow.

Does agency matter?

I'm currently on a solo adventure in the Cameron Highlands. Between tours, I should have some time to blog.

I have interesting discussions with my young students that aren't always about technology, and there's certainly a lot of anxiety about job availability because of AI. One area I suggest the students develop is agency. At that time, I defined it sociologically — what kind of constraints society places on a student and how they can overcome them to be successful on their own terms. My logic is sound: for most of my students, adopting the same success standards as their JC peers would do them little good, regardless of what their parents might think.

But a smart guy in my class has a valid counterpoint. If everybody exercises agency, then the spoils will go to those who exercise the most agency, so the competition remains fierce, and it's back to square one.

I'm a sporting guy; I'm happy to concede the point, although I'm not convinced by his argument yet, but I'm glad he put serious thought into this matter, which itself is an exercise of agency, as the lecturer is not always right.

Fortunately for me, Martin Seligman, the father of positive psychology, later published a thorough perspective on agency from a psychological standpoint. According to Seligman, agency is comprised of three parts:

• Efficacy - You must believe that you can be the author of your own fate.
• Optimism - You must believe your future will be better than your situation today.
• Imagination - You are creative enough to solve problems your way or envision a better life for yourself.

Surprisingly, most of the book isn't particularly useful to me, as Martin's work reads like a history book, showing that periods of great human flourishing correspond to words in the era's literature that reflect great human agency.

But for me, now I have a new tool to debate agency in class. As it turns out, a diploma program will ideally level up a person's efficacy by improving their skill set, making them more employable, etc.... But a certain proportion of optimism is genetic. Imagination is also a function of personality, like openness to new experiences.

So, in practice, few folks have the capacity for agency. In fact, I can imagine progressives trying to paint agency as something that has links to race, social status, and social capital. Some might say that tolerating agency will magnify inequality, which the political left and sociologists fetishize.

I've got one final point about the book. 

The best part about the book has nothing to do with agency.

As it turns out, Martin Seligman can lucid dream. 

So, as his colleagues begin to die of old age, he can summon them back in his dreams to discuss the topics that he is working on. He admits that these dream colleagues can only answer based on what he knows of their work, and that it's not too different from using AI.

Why do gurus need to show off their Lamborghinis ?

 

Short answer: because the Lamborghini is the product. The investment course is just how you pay for it.

If you scroll through finance content aimed at Singaporean men in their twenties, you will notice that the backdrop rarely changes. A supercar, a rooftop bar, a Marina Bay view, a watch the camera lingers on a little too long. Nobody films a dividend statement at a hawker center. There is a reason for this, and once you see it, you can't unsee it. It also explains why so many young men end up in strategies that are designed to blow up.

The real market is status, not returns

Most investment gurus are not selling returns. They are selling status, and their biggest buyers are young men.

Young men want high status, and they believe, with some justification, that status improves their prospects with women. I wrote about the research on this in 2019 in Do women prefer nice guys or rich guys? and again last year in Why guys without a passive income of $500 had better not start dating. Whatever you think of the evidence, belief drives purchases. A 24-year-old who thinks money buys him a better position in the dating market will pay for anything that promises to get him there faster.

So the guru's marketing problem is simple. How do you show a young man, in three seconds of a TikTok scroll, that you have what he wants?

You can't show him your Sharpe ratio. He doesn't know what it is, and it isn't attractive anyway. You show him the car.

Economists call this costly signaling. A Lamborghini costs well over S$1 million in Singapore once COE is included. That makes it a credible signal that someone has a lot of money. Notice that it doesn't say how the money was made, and it doesn't even say the guru owns the car. A rental for a half-day shoot will do. The signal only has to get past the viewer's gut, not his calculator.

Why the car always comes with a high-risk strategy

This is what matters for anyone thinking of buying a course.

If your marketing rests on showing spectacular wealth, you need a spectacular story to explain it. "I bought a basket of SGX REITs and banks and compounded at 7% for 20 years" does not explain a Lamborghini at age 29. Only a high-return strategy does: options, leveraged forex, crypto, small-cap momentum, margin trading.

There is also a structural reason the guru market selects for high-risk strategies, and it has nothing to do with whether the guru is honest. I ran a simple simulation to show it.

Take 10,000 young men. Give each one a strategy with the same 8% average annual return. Half of them get a steady portfolio with 12% volatility. The other half get a leveraged one with 50% volatility. Run it for five years.

After 5 years	Steady (12% vol)	Leveraged (50% vol)
Median outcome per $1 invested	$1.43	$0.85
Tripled their money	0.1%	14.1%
Made 5x or more	0.0%	5.2%
Lost half or more	0.0%	36.6%
Lost 90% or more	0.0%	14.6%

Monte Carlo simulation, 10,000 paths per strategy, normally distributed annual returns, losses capped at -100%. Illustrative only, not a forecast of any specific strategy.

Look at the leveraged column. The typical investor loses money. More than a third lose half. One in seven is wiped out. And yet roughly one in twenty makes five times their capital.

Now think about who makes content. The 5% who turned $50,000 into $250,000 have a story, a screenshot, and maybe a down payment on a nice car. The 15% who were wiped out stop posting. The steady investors have nothing to show except $1.43 for every dollar, a good result nobody wants to watch.

So even if every strategy has the same expected return, the people who end up on your feed come almost entirely from the high-risk tail. You are not looking at a sample of investors. You are looking at a sample of survivors.

The guru's incentives make this worse. If his strategy works, he sells courses. If it fails, he deletes his account, and another winner from the same lottery takes his place. His payoff looks like a call option, so he should prefer high volatility. Your payoff looks like the whole distribution, including the part where you are wiped out.

Why young men specifically take the bait

Two things push young men towards this trade.

The arithmetic of a small portfolio. A 25-year-old with $20,000 earning 6% makes $1,200 a year. That buys nothing he can show anyone. The only way a small portfolio can change your life in two years is to take risks that are just as likely to destroy it. High-risk strategies are not irrational for this group. They are a rational response to the wrong goal.

Risk appetite peaks in young men. This is well documented in behavioral research and needs no further explanation to anyone who has driven on the PIE on a Friday night. In the ERM readings, I describe dopamine-seeking as the first of three psychological roots of rookie portfolio design. A variable-reward strategy that pays off big once in a while feels very much like a slot machine. The Lamborghini tells you what the jackpot looks like.

Put the two together, a status-hungry buyer and a marketer who has to signal high returns, and you get a market that consistently matches the riskiest strategies with the people least able to survive their losses.

A detour through my Second Brain

Here is something I found while writing this.

Earlier this year, I moved 20 years of blog posts, research reports, and teaching notes into an Obsidian vault, and I've indexed it in a Qdrant vector database so I can search by meaning instead of keywords. Before writing this article, I asked it about "investment gurus showing off luxury cars to young men."

The top results were not about gurus. They were SGX research reports on Hong Leong Asia, which makes truck powertrains, and China Sunsine, which makes rubber chemicals for tires. The embedding model saw "cars" and went straight to engines and tires. When I searched for "high risk high return strategy," it returned the leverage section of my Olam report and position sizing tables from my REIT analysis.

That's a funny result, but it also says something. In my own notes, risk shows up as a net debt-to-equity ratio, a refinancing schedule, or a trim level. It's a spreadsheet. In guru marketing, risk shows up as an orange car. Same concept, completely different representation, and the second one sells far better.

When I adjusted the query, the vault surfaced the posts I expected, and I found I had been writing this article in pieces for almost a decade without connecting them:

• 2017, Inconspicuous consumption and the theory of platforms: how educated people signal status without luxury goods, written in the same post where I discussed the margin trading debate going around the blogs.
• 2018, The Things that you buy leave no trace: research showing an expensive car really does make its owner happier than an average one, which is exactly why the signal works.
• 2019, Do women prefer nice guys or rich guys?: the mating-market premise behind the whole guru economy.
• 2019, MBA in a Nutshell #17 – Sales: AIDA (Attention, Interest, Desire, Action) versus consultative selling. The supercar is the cheapest Attention trigger there is.
• 2022, Why we pursue status: my notes on David Marx's Status and Culture and how chasing status destroys wealth.
• 2025, Why guys without a passive income of $500 had better not start dating: money and the dating market, again.

Status, mating, sales funnels and risk had sat in four separate clusters of my vault for years. The guru's Lamborghini is what links them. That is the real argument for building a second brain. You can't remember what you wrote eight years ago, but a machine can show you that you already had the pieces.

What to do instead

If you are a young man reading this, I am not going to tell you to stop wanting status. That is like telling you to stop being hungry. Here is what I would do instead.

1. Ask for the drawdown, not the return. Any guru selling a strategy should be able to tell you its worst peak-to-trough loss and how long recovery took. If the answer is vague, or the track record started after 2022, walk away.
2. Ask how many students blew up. A course that cannot tell you its failure rate is showing you the 5% column of my table and hiding the 15% column.
3. Separate the signal from the source. Ask what share of the guru's income comes from trading and what share comes from selling courses. In most cases, students, not markets, paid for the car.
4. Size your portfolio to survive. Before you can compound, you have to avoid being wiped out. A strategy that ends with a 15% chance of losing 90% is not an investment plan, whatever the upside.
5. Pick a better status game. The status that actually holds up in Singapore, a paid-off flat, a dividend stream that covers your basic expenses, a career with optionality, doesn't photograph well. It also doesn't get repossessed.

The guru needs the Lamborghini because his business depends on you looking at the right tail of the distribution. 

Your job is to look at the whole thing.