How does a country win a gold medal for its economy?
With the Olympics heading into their second week as this episode of Motley Fool Answerswas recorded, hosts Alison Southwick and Robert Brokamp hand out some medals of their own. Instead of rewarding swimming, running, or other sports, they examine countries based on their economic future and innovation aptitude. They also welcome Fool Funds Portfolio Manager Bill Mann either back to the show or to the show, depending on whose memory is correct, and they discuss exactly how much of your net worth should be in stocks.
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The team also discusses the merits of having a big pile of money on hand or not having one at all, and you won't be shocked by their answer (but some of what they suggest may surprise you).
A full transcript follows the video.
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This podcast was recorded on Aug. 9, 2016.
Alison Southwick: This is Motley Fool Answers. I'm Alison Southwick and I'm joined today by Robert Brokamp, personal finance expert here at The Motley Fool.
Robert Brokamp: Hi, Alison.
Alison: Hi, how are you?
Robert: Great, as always.
Alison: Good. I am also joined by Bill Mann. He's the portfolio manager for Fool Funds. Hi, Bill.
Bill Mann: I finally made it!
Alison: I know. Well, you've been on the show before.
Bill: No, I haven't.
Robert: Yes, you have. You have!
Bill: OK, yes, I have.
Alison: How could you not remember this life-changing moment that we had where you were on our podcast?
Bill: I love this Jedi mind trick that you have.
Alison: You have!
Robert: These aren't the podcasts you're looking for.
Alison: I didn't make it up.
Bill: Yes, and it was wonderful.
Alison: Keep going! The Olympics are in full swing, and we thought it would be a great opportunity to award medals to countries based not on their athletic prowess but on the promise of their economic future and innovation aptitude. We're also going to answer your question about how much of your net worth should be in stocks and give you an honest visitors' guide to Rio. All that, and more, on this week's episode of Motley Fool Answers.
Alison: It's time for Answers, Answers. J.T. writes: "I have set aside one year's worth of expenses as an emergency fund in cash. In terms of my total net worth" (here come some numbers), "25% is tied up in my house, 35% in my 401(k), 15% in a brokerage, and 25% in savings. My 401(k) is all invested in the stock market. I understand that a savings account is the worst possible investment, but it is a bit scary to have half of my net worth in stocks given how volatile the market is, now. Can you give me some suggestions?"
Robert: Well, J.T., congratulations on the big emergency fund. That's actually a good bit more than most people would recommend. Generally, it's three to six months of absolute, must-pay required expenses. You can adjust it for your job security. You do have a house, and that's one reason to have an emergency fund, in case you have to replace the roof or anything like that. If you have more people depending on your income, you would have a bigger one. But very few people recommend that you have an emergency fund that big, so that is definitely playing it pretty safe.
Bill: Better than the alternative, though.
Robert: Of having absolutely no emergency fund.
Robert: Absolutely. I totally agree with you on that, Bill.
Alison: But given the choice between having a big pile of money and no pile of money...
Bill: Nine out of 10 dentists would also agree.
Alison: Agree. A big pile of money is the way to go.
Robert: As for the stocks, it really depends, as you probably already know, when you need the money and a little bit on your risk tolerance. So when you need the money -- if you are farther away from retirement -- it's better to be in stocks. Long term shows that historically if you look at the numbers from Ibbotson from between 1926 and 2015, the stock market made money in about 73% or so of the five-year periods, 86% of the 10-year periods, and 100% of the 15-year periods. And when you're comparing stocks to cash, and cash doesn't earn anything, all you're looking at is basically whether it's going to make you any money compared to cash.
And you also have to factor in a little bit, especially when you're looking at your brokerage account that cash, if you're getting any interest at all, is taxed as ordinary income. That's the highest rate out there. If you buy a stock and you hold onto it for 10 years, you don't pay any taxes until you eventually do sell it. Dividends (hopefully they're qualified) are taxed at lower rates, so even on a tax perspective, it makes sense to hold stocks for the long run versus just cash.
That said, clearly it might keep you up at night. You have what strikes me as maybe a little bit of a lower risk tolerance, and that's OK. This is what I suggest you consider doing. Take some of that cash that is earning virtually nothing and pay off some of your mortgage, because when you pay off debt like that, it's a guaranteed return. If your mortgage is at the rate of 4%, it's essentially a 4% return guaranteed, very safe, and that increases the chances that you'll go into retirement debt-free, which is a beautiful thing.
"Ad: This podcast is sponsored by Rocket Mortgage by Quicken Loans."
Olympic theme song
Alison: It's the Olympics! Yeah! And Bill Mann is joining us here to make his predictions for the countries that are going to take home the gold, silver, and bronze in the coming years. Hi, Bill!
Bill: How are you?
Alison: I'm good. How have you been?
Bill: I'm great.
Alison: So, you are, of course, a portfolio manager for Motley Fool Funds (a sister company of The Motley Fool). We have funds, and you portfolio manage them.
Bill: I portfolio them. Yes, that's right.
Alison: Prior to that you ran Motley Fool's Global Gains newsletter.
Bill: That's right.
Alison: But you know a thing or two about investing around the world.
Robert: And he used to sell underwear in Russia. Let's not forget that.
Alison: Do you remember? You talked about that when you were here.
Bill: It's all coming back to me. I do remember.
Alison: It's not. You're lying to me.
Bill: No, I'm totally lying. Sorry.
Alison: So, today we're going to look at five different medals (we're calling them medal categories). We're going to look at Innovations in tech, entertainment, energy, brands, and manufacturing and which countries Bill predicts are going to take home the medals.
Bill: Now, it is very important to point out that what you described to me was that we're thinking about the future.
Robert: That's right.
Bill: So, manufacturing people will say, "Well, China's going to win." Stick with me. China might not win.
Alison: Oh, it's so exciting. Oh, the spirit of competition is great. The first category we're going to look at is innovations in technology.
Bill: Wonderful. Some countries that come to mind in terms of innovation -- you have the United States, of course. You've got Germany. You've got France. You have the United Kingdom. Brexit or no, they will still be the same. Switzerland. Taiwan, even. Or I guess I need to say Chinese Taipei...
Bill: ...for the sake of the Olympics.
Bill: Hong Kong. China. But I do think that the gold medal... Should I start with gold?
Alison: No, let's start with bronze.
Robert: No, let's go with bronze.
Bill: Start with bronze. I think that the bronze winner will be Germany. Germany is a very quietly technologically advanced country. They have a very good education system. Lots of entrepreneurial spirit. I really do think that Germany is our bronze medal winner.
Alison: Congrats, Germany. Silver?
Bill: Silver is Japan, for two reasons. One is household gadgets. For example, have you seen the portable armpit coolers? Electric armpit coolers? Yes.
Alison: What are you talking about?
Bill: They clip under your sleeves when it's hot out and they blow air into your pit regions.
Robert: Does that mean they're blowing air out? I mean the air, if it goes in there...
Bill: It could be. Let's not ask too many questions. We're innovating here. And also robots. Japan is a leading producer of robots and some of the things that robots are doing now are absolutely spectacular.
Alison: So, armpit coolers and also robots.
Bill: That's right. Also robots.
Alison: Also robots. Whatever.
Bill: And No. 1 is...
Alison: USA! USA! USA!
Bill: These United States of America.
Robert: Da da da da da...
Alison: Tell us why we're awesome.
Bill: Five percent of the world's population and a really staggering amount of the entrepreneurial spirit. [With] the companies that have been formed in the United States and the types of things that are really helping change the world, the United States is really second to none.
Alison: So when it comes to innovations in tech, you kept mentioning entrepreneurial spirit. Is that really what drives technology do you feel?
Bill: I absolutely believe so.
Alison: It's the entrepreneurial "You can make it happen -- go out and do it" spirit.
Bill: Right. You look at a problem and say there's a solution here. The United States -- for all of what people say about the problems with our educational system -- I think that we're better at educating these autodidactic kids. Whoa, what a great radio word that is. If I had another one, I'd use it. But kids who really can think for themselves. I think the United States is very good at educating these kinds of people.
Robert: I was reading an article about South Korea, which is also a very innovative economy, but one of the differences there is you usually work for a big corporation and you come up with your great ideas, but then it has to go up the hierarchy to the heads of Samsung or whoever and they have to approve it. Whereas in America...
Bill: We've got garages.
Robert: Exactly. And it's more like, "Oh, I work for Google, but I came up with this good idea and I'm going to leave Google and start my own little company and start a business."
Bill: I was making a little bit of a joke, but those sorts of things that start in garages are almost exclusively the domain of the United States. I don't think it's great, but it's true.
Robert: We have the best garages.
Alison: We have great garages here in the U.S. The next medal category we're going to look at is the world of entertainment.
Bill: Entertainment. So I actually eliminated the United States.
Bill: Here's why.
Alison: I'm listening. I'm listening.
Bill: I mean, we have Hollywood, but we also have the Kardashians, which I think...
Alison: It's just not fair to the rest of the world or...
Bill: I think that eliminates us.
Alison: Oh, come on! All right.
Rick Engdahl: Performance enhancement?
Bill: Yes, that's right. Exactly.
Robert: There you go.
Alison: What did you say, Rick? I missed that.
Rick: Performance enhancement.
Bill: We're performance enhanced. We've been thrown out.
Alison: All right. So the U.S. has been thrown out for performance-enhancing drugs. Or something. And so then who are you looking at here...
Bill: I may not be able to complete this now.
Robert: I think that's really cosmetic enhancement.
Alison: All right, the main medal contenders.
Bill: So No. 3.
Robert: The bronze?
Bill: The bronze medal is China.
Bill: I don't know if you've seen the new Star Trek movie...
Bill: ... but it was produced and paid for by Alibaba, one of the largest Chinese companies.
Alison: Oh, I didn't know that.
Robert: I didn't know.
Bill: They are in a big, big way getting into various entertainment. The other thing about China is that I included Hong Kong in that, and if you're a Kung Fu person like me, there's the Kung Fumovies. So between the two, I thought that China has a very good claim on the bronze.
No. 2 is the United Kingdom. Brexit and all, they still, for a very small island, have a huge amount of soft influence in the world based on...
Robert: Downton Abbey...
Alison: No! Based on Tom Hiddleston.
Bill: Right there.
Alison: Oh, my gosh. Like right there they take home the silver.
Bill: Right. He's a handsome, handsome man.
Alison: He is such a handsome man. Like he is a really hip...
Robert: I don't know who this is.
Bill: He's Loki.
Alison: He's Loki, but he's not handsome when he's Loki. He's handsome when he is everything else in the world.
Robert: Now I've got to look at his picture. Who is it? Tom Hiddleston?
Alison: The Night Manager.
Bill: Thank you.
Alison: So Tom Hiddleston was in The Night Manager and it's unfair how attractive he is.
Bill: So Tom Hiddleston gets the silver.
Alison: Yes. The silver goes to Tom Hiddleston.
Bill: And his people.
Alison: And he'll thank the U.K. in his speech, I'm sure. So who gets the gold?
Bill: No. 1...
Robert: I'm very curious about this.
Bill: No. 1 for entertainment is Japan.
Robert: That's for the Pokemon Go?
Bill: Pokemon Go. No, the game shows.
Robert: Ninja Warrior.
Bill: Ninja Warrior. Yeah.
Robert: That's true. That's a good one.
Bill: Japanese entertainment is the greatest.
Alison: Just all that anime people love.
Bill: Yeah, anime. The "firecrackers up the nose" game shows.
Alison: That's a thing? They put firecrackers up their nose?
Rick: Here. We'll show you.
Bill: Look. This is a gold-medal move. Yeah.
Alison: That's what it takes to win a medal from Bill Mann -- is stick a firecracker up your nose. Nobody listening at home should do that.
Robert: Bill Mann's not worth it.
Alison: He's not worth it.
Rick: So, did Bollywood just stumble at the finish, or what?
Bill: Bollywood's strong. Also Nollywood.
Alison: What's Nollywood?
Bill: Nollywood is the third-leading producer of movies in the world and comes out of Nigeria.
Bill: Oh, my gosh. Nigerian soap operas...
Robert: I think I read about this in an email I got once.
Bill: No, no, no. They aren't asking for money, but Nigerian soap operas are awesome.
Alison: Oh, OK.
Bill: Awesome. Plus an unbelievable music scene in Nigeria.
Alison: I do like African music. I've been listening to a lot of African music lately. Next category. Not as exciting...
Alison: Energy. Let's talk about your predictions for winning the medal in energy in the coming years.
Bill: So, some obvious participants. Some obvious contenders. Saudi Arabia. There is Qatar. There's Russia. Those are all oil-producing and gas-producing countries, which I think or I hope is more of a past thing than a future thing. For the bronze medal, I named Norway.
Bill: Norway, the leading purchaser of Tesla cars outside of the United States. They were the first adapters for electric vehicles. They were the first place to have tidal power -- like wave-generated power.
Bill: Yes, and for a little country, they've got a lot of coastline. And also for hydropower. Almost all of their power comes from hydropower.
Alison: Way to go, Norway. You get the bronze.
Bill: Norway gets the bronze. For the silver, I have China. China, which maybe you've heard, is one of the largest producers of greenhouse gases in the world...
Bill: ... so they're pretty good at that. That's another category, maybe. But China has 100-fold increased its dependence on solar power over the last five years, and it is putting billions of dollars into doing it. So I think China, in the future, because they've got a ton of land, and they're pretty good with the whole sunshine thing, China is the silver medal winner.
Alison: Good for you, China. And the gold goes to...
Bill: The United States of America.
Bill: Yes. One, we have an unbelievable amount of resources in the extractive industries. In petroleum, the technology that we've developed over the last few years has been transformational. Also, we have the whole electric-vehicle thing that we're pretty good at. And things like energy storage, which, again, is being produced in the United States more than anywhere else. Maybe tie that back into technological innovation.
Alison: The next medal category is brands, and you pitched this to me, and I'm still not quite sure what it means.
Bill: So the way that we invest is we look for companies that have really great barriers to entry, and the best barrier to entry, of all, I think, is a really good brand. Because almost everything else can be competed away. It's really hard to compete with Gucci. You can't just say, "Hey, we're New Gucci." It just doesn't work that way. So brands are the things that I think create a tremendous amount of value for companies and for countries.
Alison: All right.
Bill: So some of the competitors. Once again, the United States of America. The United Kingdom. Sweden is a competitor.
Alison: Because of Ikea?
Alison: Volvo. OK.
Bill: Germany is a competitor. Japan is a competitor.
Alison: So who takes the bronze medal?
Bill: The bronze goes to Italy.
Bill: I kind of tipped it off, didn't I?
Alison: By saying Gucci?
Bill: By saying Gucci.
Alison: But you didn't give them the gold.
Bill: So think of fashion and there really is one competitor to Italy. And it's not even high fashion, like people wearing those really weird things and it's supposed to be beautiful.
Alison: Bill Mann on fashion. I guess that's supposed to be beautiful or whatever. I don't know. It's weird.
Bill: They paint their face...
Alison: You're talking runway shows, where they wearing large, conceptual things. Fine.
Bill: Thank you. Right. [Lidio]. Italy is the leader with their brands. Gucci is one. Tod's is one. They're very strong, and it gives them at least a reason to hope for the manufacturing segment of their economy for years to come.
Alison: A good pair of leather shoes.
Alison: I'm going to assume they're Italian.
Bill: You're just going to.
Bill: Silver is Switzerland.
Alison: It's all about the watches.
Bill: All about the watches. And people are pooh-poohing watches as being a thing, but the amount of extra value that you get out of something being made in Switzerland versus anywhere else is massive. I mean, you don't look for things that say "Danish-made watches." I'm sure the Danes would be just fine at precision engineering, but the Swiss are the ones who are better at it than anyone.
Alison: And who takes home the gold for strong brand?
Bill: Who do you think?
Alison: Is it USA?
Bill: It has to be. Of course, it has to be. It's almost not fair. The strongest brands in the world. Why don't we start at the top, shall we?
Alison: I'm going to say Apple.
Bill: That's a pretty good one.
Robert: McDonald's or Coke.
Bill: McDonald's or Coke.
Alison: Oh, Coke. That's huge.
Bill: Then go back into entertainment. You have Disney, for example. The massive Disney theme park was just opened in China. The reverse is not going to happen, here, for decades. I mean, I bet it would a fun theme park. It'd be great.
Alison: Name one Chinese theme park. No. Not yet. It's not going to be opening here yet.
Robert: And even sports. I remember the first time I went overseas. I was in Italy. It was in Venice. I went to a shop and it was completely American sports stuff. Michael Jordan shirts. I could buy a Tampa Bay Buccaneer hat in Munich.
Bill: And you were wanting to.
Robert: I was the only one who cared. I was like, "Why are you selling Tampa Bay Buccaneer hats?"
Bill: I'll take six.
Alison: I'll take the whole house.
Bill: So for brands, the United States of America is pretty good at it.
Alison: Yes, we are good at ramming our culture down other people's throats.
Robert: There you go.
Alison: Our culture, for whatever it is. For whatever we made it. The final medal category is Manufacturing.
Bill: So there are a lot of very reasonable competitors, here. You could go a little off menu. Places like Bangladesh, which is an enormous apparel manufacturer.
Alison: Oh, OK.
Bill: There's also Vietnam. There's China, of course. They do some manufacturing from time to time. Germany. The United States, once again. Canada. Countries like this. So for third place...
Bill: ...bronze. God, they do call it bronze.
Alison: They do call it bronze. We've been trying to call it bronze, here. You keep undermining me by saying first, second and third, but that's fine. Bronze!
Robert: The person who takes the white ribbon is...
Bill: Do we get to do participant ribbons? So the bronze medal winner is Vietnam. If you go to the northern part of Vietnam, now, you will see what China used to be 20 years ago. It is massive manufacturing facilities. China does not have the same level of advantage from labor costs that it did 15 years ago, and a lot of that business is moving to Vietnam. It is, perhaps, an upset pick, but I feel pretty good about it.
Alison: Good for you, Vietnam. You got a medal. All right, who takes home the silver?
Bill: The United States of America takes home the silver.
Alison: Oh! OK.
Robert: Which surprises a lot of people, because you hear so much about how we don't manufacture stuff anymore, but it's not really true.
Bill: By 2020, the United States will once again be the largest manufacturing market in the world. Now the thing is -- and I'll tell you where people are right -- is the thing that it has not done. It hasn't translated to the same number of manufacturing jobs there used to [be]. But you can name a lot of things that are manufactured here.
It's a different environment than it was in the '50s, when it was all heavy industry and it all required the guy who twisted this left lug nut and then there's a guy who twisted the right lug nut. A lot of that stuff is done by robots, now.
Alison: That Japan made for us.
Bill: Exactly. So that's not great, but nonetheless, the U.S. is actually a manufacturing powerhouse and I predict that it will continue to be so and become even more so.
Alison: So who takes home the gold in manufacturing?
Bill: Number one in manufacturing in the world is Germany.
Robert: I knew it!
Alison: Germany! China didn't even [get] a medal.
Bill: China, no.
Alison: Why Germany?
Bill: Germany is the manufacturing powerhouse of Europe. Germany has actually benefited more than any other country from the existence of the EU. They manufacture everything. If you think of Germany in your mind, you may think of two things. One is like a giant glass of beer. The other is just a giant thing that makes lots of stuff.
Alison: An efficient, well-oiled machine.
Bill: That's exactly right.
Robert: If you go to Brokamp.com, you will see that it is the home page of a German manufacturing company.
Bill: You seem a little bitter about this.
Robert: Now, I'm very proud of it.
Bill: Did you forget to renew?
Alison: So let's look at the final tally. Let's tally up the medals. The U.S. goes home with three gold medals and a silver. Yay!
Robert: Yay, Alison. Not biased at all.
Alison: No. Japan takes home a gold and a silver. China took home a bronze and a silver. Germany takes home a gold and a bronze. And also some other ones were thrown in there, too.
Alison: And Vietnam got one, too. Yay!
Alison: Well, this has been fun. Thank you for joining us with this. I have one last question, though, before we go.
Alison: As we all know, the biggest headline coming out of Rio has been that the water is filthy dirty, and that people are going to have to swim marathons through muck. In fact...
Bill: Poop water.
Alison: Poop water. It's poop water. The viral level of the water is [up to] 1.7 million times what would be considered worrisome in the U.S., and in fact the rubbish is so thick that rats live on top of the water in the floating debris.
Bill: Now, in Brazil's defense, we are a little hyper.
Alison: You think we're just too clean?
Bill: Well, 1.7 million times. Maybe cut it in half. We're a little hyper.
Robert: What's wrong with a little poop water?
Alison: I'm OK if maybe there's a couple of rats swimming around in the water, but not building homes on top of the water. Come on!
Robert: Entire cities.
Alison: It's just a few rats here and there. Who cares? My question for you guys is if you're at the peak of your game, and this is your Olympics ... you're going ... are you actually going to compete? Swim in the rat city water?
Alison: Do you do it?
Bill: You have to do it.
Robert: Yeah, I think so.
Bill: Absolutely. Do you think athletes don't put up with worse privations than that? I mean, I can't come up with any. I mean, you have to.
Robert: I grew up on the Gulf Coast of Florida (thus the Tampa Bay Buccaneer hat) and as a kid, seeing all the fish in there and realizing that, of course, fish don't get out of the water to go to the bathroom, I called the ocean "the fish toilet." So I think anyone who thinks that when they go in the ocean it's clean, they're wrong.
Alison: OK. So you're going to do it.
Bill: Yeah, I'd do it. I think you have to.
Alison: They said that if you drink more than three tablespoons of this water, you're going to get sick.
Robert: Olympic glory is worth it.
Alison: It's funny. I've asked a few people this question and many people have responded vehemently no. No. Including our own Rick...
Rick: Not a chance.
Robert: What about you, Alison?
Bill: You're not in the moment.
Alison: I feel like if you're a marathon swimmer, that's what you're swimming for. It's getting a medal. That's what your whole life has been spent doing.
Bill: I think for most people, there's a much bigger risk about what's going on in the Olympic Village than there is anyplace else.
Robert: There's all kinds of dating things.
Alison: We're talking about all the special hugs that go on.
Bill: Special hugs.
Robert: Special hugs. Who gets the medal for special hugs?
Alison: Who gets the medal gets a special hug. It sounds like a crazy, fun time.
Bill: I think that's probably the bigger worry, but I'm swimming. I'm swimming.
Alison: Now I'm wondering if you're willing to go and swim this just so you can spend some time in the Olympic Village. Like small price to pay...
Bill: That's right.
Alison: ... just to meet the Italian ladies soccer team.
Robert: For their shoes. For their shoes.
Bill: Yeah. Officially, no.
Alison: And, unofficially no, Mrs. Mann as well. Well, Bill, thank you for joining us for the first time ever. We really appreciate it. You've been great. Please come back. Or don't! I don't know.
Bill: I won't remember. It's fine.
Alison: I only really know stuff about Rio that the media wants me to know.
Robert: The media. Who can trust the media?
Alison: I know. Let me sound really negative. The media! But all of the press around the Olympics has been that Rio is dirty, that Rio is unsafe, and that Rio is corrupt. But is this really true? I wanted to know, so I asked our resident Rio expert, Patrick Woods, to join us.
Robert: Hi, Patrick!
Patrick Woods: Patent-pending Brazilian name.
Alison: Patrick Woods may be the least Brazilian name for some guy was born and raised in Brazil. Hi, Patrick. So you're a developer here at The Motley Fool.
Alison: How is it that you came to be a Brazilian?
Patrick: My mother is Brazilian, and we moved to Brazil when I was one, and spent about nine years living in Sao Paulo and then five years living in Rio. Then we moved back to the U.S. for what was supposed to be two and a half years and that two and a half years has become permanent.
Alison: For most of your childhood and formative years, and you also still have family in Rio and Sao Paulo, probably and all over.
Robert: You don't have a Brazilian accent. When you go to Brazil, do people think you have an American accent?
Patrick: No. Portuguese was actually my first language. Then, in third grade there was a chance that we might get moved back to the U.S., so I started going to an American school. I don't know. I think I lucked out with not having an accent. My sister doesn't, either. My Portuguese gets rusty mostly on vocabulary, but pronunciation and accent-wise, I used to not have one. We'll see.
Alison: Patrick, we have asked you here to address three perceived ideas of what it's like to live in Rio and then also provide our listeners with a helpful phrase in Portuguese to help them navigate their way through the streets. The first topic we want to cover is the idea that Rio is extremely unsafe.
Patrick: That is probably accurate. When you live there, you get used to it. The people aren't getting gunned down in the streets. Rio has a high concentration of very poor people and very wealthy people very close together, so I think that leads to a little bit more of the casual violence and...
Alison: Casual violence...
Robert: Let's go for a walk and get nabbed.
Patrick: It does happen. You are very careful. You don't wear jewelry outside, and you don't wear a watch. You hide your wallet. These become normal things that you do and you don't really think about it.
Alison: You're so nonchalant about it. I talked to you about this before. I asked how many times you've been mugged in Brazil. How many times have you been mugged?
Patrick: At least four times.
Alison: At least four times. It blows my mind that you're like, "Yeah, whatever. You get mugged." Then your uncle also drives a bulletproof car.
Patrick: Yes. One of the things that happens is, especially if you have fancier cars, you can become a target. I don't think it's so bad right now, but for a while, there was a big epidemic of people getting kidnapped and held for ransom. It wasn't just very public people. It was your upper-middle-class families that [kidnappers] thought could pay. That gets kind of scary.
One of the things I think has happened since I lived there is that there's a lot more weaponry involved than there used to be. It used to be mostly getting approached by street kids and they'd say they had a knife. Now I think more people tend to have guns, so it's probably more dangerous than it was at that point, but I still get the impression that most of it is just casual muggings.
Robert: They used to be more civil muggings back in the day.
Patrick: Well, you could argue with them. I was telling Alison earlier how you used to be able to negotiate with them to give you bus money so you could get home.
Alison: So, the helpful phrase that we have for our listeners is "no one loves me enough to pay a ransom." This helps get you out of a jam if you do get kidnapped.
Patrick: So Portuguese (especially in Rio) has a lot of slang and that changes a lot, so I'm probably way off on some of these. One way that you say that would be ningum me ama o suficiente para pagar um resgate.
Alison: One of the ways you could say that. Like I could basically form those syllables.
Robert: That was among the five choices in my mind.
Patrick: Well, resgate is sort of the official words for ransom, but it's also like a rescue. If you're lost and someone rescues you, you have [00:32:11]. So there might be another word that people might use more explicitly for that, but that might work. Especially if you say it with an accent, they might believe you.
Alison: Let's hear that one more time. No one loves me enough to pay a ransom.
Patrick: Ningum me ama o suficiente para pagar um resgate.
Alison: The next topic we want to cover is the idea that Rio is extremely corrupt. You set me straight on this by telling me about the notion of (I'm going to totally butcher this) but jeitinho?
Patrick: Jeitinho. Brazil was in a dictatorship for 21 years, so there's a lot of corruption...
Alison: You literally have your hands up in the international sign for "What are you going to do?"
Robert: Sometimes it rains. Sometimes there's corruption!
Patrick: It's just the way it was. There is this concept in Brazil of the jeitinho. Like certain cultures haggle for things. You try to find the way. It points to creativity and street smarts. It's like, "How did you get this?" It's just like, [00:33:59]. It's unspecific and there's a lot of that in everyday stuff. Like trying to get away with things. Corruption is sort of endemic to the culture. In a culture where you're always trying to look for a leg up and trying to score something, it leads to that sort of corruption.
Alison: I think that would drive me crazy. I like countries where you queue up, you follow the rules, and you get in line. I think that would drive me crazy.
Patrick: It drives my wife insane when we go and visit. You'll be waiting in line to get ice cream. There's a line, but everyone's trying to go over to the side and call the guy. She gets insanely frustrated with the whole thing.
Alison: The phrase we have to help our listeners, should they find themselves in Rio, and get through that culture of a little corruption, is "How much is one bribe, please?"
Patrick: That's one of the ones you would have a bunch of different ways that you could say it. The bribe in Portuguese is a suborno, which is technically a bribe. And in the news lately, there's a lot of talk about a propina, which is technically a fee, but it's used a lot like, I'll build this thing for you and then you can pay me all this extra money. But the main [thing] for this is to ask how much something costs. You can say something like quanto vai me custar which would be more "what's this going to cost me" instead of [00:35:33] which is more like how I'm going to bribe you.
Alison: How can I bribe you, please?
Robert: Let me count the ways.
Alison: And the last thing we want to talk about is that Rio is really dirty. There's been so much in the news about the water and how it's dirty and disgusting. We read an article today and it was about how dirty Guanabara...
Alison: Guanabara is.
Robert: Yes, that one!
Alison: And in the article was a series of pictures, and one of the pictures was literally a severed arm...
Robert: My God!
Alison: ... floating...
Alison: ... in the water. And Rick was like, "Oh, is that someone swimming?" He was looking over my right shoulder, and I'm like, "Nope. It's just a severed arm. Someone was swimming." I'm sorry. It's unfair for me to kick into you and say, "But, really, tell me. How dirty is the severed-arm water?"
Robert: It's funny because it's tragic.
Alison: It is sad. It's really sad. I shouldn't be laughing. I should not be laughing.
Patrick: I guess it is pretty dirty. There's problems with sewage and trash and just that sort of general stuff. I remember when being a kid that there's a neighborhood that's underneath the Sugarloaf. I had a girlfriend who lived there. There's a nice walk that goes about the bay. And that's what you would do. You would hang out. And there were no severed arms that floated up or anything like that.
Alison: You're going to get mugged, but...
Patrick: Yeah, you might get mugged. Actually, that neighborhood was pretty OK. It's a beautiful city with everything in it. There's a lot of graffiti. It's tropical, so everything has a little bit of slime to it. It's muggy. New York, to me, is always very dirty and it had that a little bit.
But it's a big city. There's a lot of pollution. A lot of cars. There's a lot of all that stuff, but at the same time, it's this massive city like New York. It's in the mountains, with all this green. It's right by the ocean. And as you drive around, there's beaches and mountains and trees everywhere.
So it's dirty, but you don't really think about it when you're there. I actually don't know why the bay is suddenly so dirty. I don't remember it being that filthy before, but there definitely seems to be something woefully wrong right now.
Alison: So our helpful line for any tourists who plan on going to Rio is "that smell is remarkable. Let's swim someplace else."
Patrick: I guess you could say that like, Que cheiro. Vamos nadir em outro lugar or something like that.
Robert: One of my favorite songs of all time is The Girl From Ipanema, Ipanema being a neighborhood in Rio, and I found out recently that perhaps that word means "stinky lake." Did you know that?
Patrick: I did not know that.
Robert: It's true.
Patrick: But it's not a lake.
Alison: It's a beach. I thought it was a beach.
Patrick: It is a beach.
Robert: Wikipedia said it so it must be true.
Alison: This is why we brought Patrick on. You are not the Brazil expert. He is. Are you excited about the Olympics being in your hometown?
Patrick: I am. It's funny. When this all started, I was thinking this was going to be a mess, because Rio is busy. There's lots of traffic. I just didn't see how it was going to be able to handle something like the Olympics. Whenever there is a big event like this in Brazil, the whole country gets around it and focuses on it. I don't feel like we do the same thing in the U.S. to the same extent.
There's a lot of negativity before it, but then when it happens, everyone is part of the party in some ways. It's very fun, and it's very intoxicating. It will be a very fun place to be with something this big going on, because everyone is doing it. I heard on the radio, today, that they're doing a holiday on Thursday because the traffic can't keep up with all of it, so they're like "Everyone stay home."
It just adds to that a little bit. I don't know if it's like Carnival or just they're used to having these big events. Whenever this is one of these, it flows through the whole city, and everything is more fun and more alive. I think it will be fun if you're there, and if you don't get hung up on the things that are not going perfectly, I think it will be a really good time.
Alison: The things that are not going perfectly.
Robert: Enjoy the occasional mugging and the floating arm.
Alison: The occasional mugging and the floating arm. If you can get past that...
Patrick: If you can get past the arms...
Alison: If you can get past the arms...
Robert: As long as it's not your arm, you're OK.
Alison: Well, thank you, Patrick, for joining us. This has been a fun chat. I'm excited about the Olympics.
Robert: One of my favorite things.
Moa do corpo dourado, Do sol de Ipanema, O seu balanado, mais que um poema, a coisa mais linda, Que eu j vi passer
Alison: That's the show, but it's time for an update. First off, I want to thank everyone who sent in postcards.
Alison: Bill, you didn't know this, but we asked our listeners to send in postcards.
Alison: I don't know. Just anything.
Robert: Where they are...
Bill: From? Oh.
Alison: From anywhere. From anywhere. So far, the one we've received that's the farthest away is from [Renee and Steven] in Berlin.
Alison: Yeah! We also got one from [Brian] in Rochester. Cynthia and Renee sent ones from Illinois (so we have a couple from Illinois). We have [Stephen] from the Pacific Coast Highway. [John] from Queens sent one from Maine, which Chris Hill particularly enjoyed. Levi also sent postcards and even some coffee mugs in defense of South Dakota.
Robert: It's a nice mug.
Alison: It is. They are nice mugs. And also Rita from Colorado. So please keep them coming because they make me very happy. We've been putting them on the column in the studio. I'll post a picture of it to our Facebook group. Are you a part of our Motley Fool podcast Facebook group?
Bill: I am.
Alison: Good. I will tag you.
Rick: Do you think we could maybe get some postcards from Rio? Maybe from the Olympic Village?
Rick: There are some athletic listeners out there, right?
Robert: We might have to spray them with Lysol, first, but...
Alison: That would be amazing. And if anything, I can cheat and I can ask Patrick's sister to send a postcard. Our address is 2000 Duke Street, Alexandria, Virginia, 22314. That's The Motley Fool's address.
Also, we have a new way that you can submit your questions. You can call our hotline. Do I call it a hotline?
Bill: It's the red phone.
Alison: It's the red phone. Call the red phone...
Robert: The lukewarm line.
Alison: ... and leave a voice mail and we'll get to play your question or your comment on the air. The number is (866) 677-3665. It's actually the old phone number from when The Motley Fool had NPR shows, so it spells out (866) NPR-FOOL, which is maybe not ideal, but it also spells out MRS-FOOL. So you can call (866) MRS-FOOL and leave a message or a question or whatever.
Robert: We charge you $0.99 a minute.
Alison: And you'll get all the sexy stock advice you want. And if that terrifies you, you can also still email us at Answers@Fool.com. That covers it. The show is edited Olympically (is that even a word)?
Robert: Gold medallingly...
Alison: By Rick Engdahl.
Bill: I think the word this week might be substantially.
Alison: It's true. So on behalf of Robert Brokamp and Bill Mann (thanks for joining us again), this is Alison Southwick. Stay Foolish, everybody.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fools board of directors. Alison Southwick owns shares of Walt Disney. Bill Mann has no position in any stocks mentioned. Patrick Woods owns shares of Apple. Robert Brokamp, CFP has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Apple, and Walt Disney. The Motley Fool has the following options: long January 2018 $90 calls on Apple and short January 2018 $95 calls on Apple. The Motley Fool recommends Coca-Cola. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.