Charlie Söderberg and the Stories We Tell

The Stories We Tell is the title of one of my favourite journal articles, written by David Colander in 1995 and published by JEP. Not for its conclusions, but for illustrating the dissonance between what economists are doing and students are learning. Obviously fuelling my passion for Rethinking and their stated goals.

Therefore, attending Charlie Söderberg's lecture i Malmö two days ago was quite delightful. I laughed in recognition, had a few "aha"-moments and a veritable avalanche of inspiration. Söderberg is an entrepreneur and lecturer, quite famous by Swedish standards for his appearances in the reality-TV show Lyxfällan - a show everyone knows about.

He talks almost exclusively about personal finance (his lecture is literally titled "A Richer Life") but frames it in ways even my mother would enjoy. He uses numbers and percentages about twice during the course of 3 hours, and targets his audiences very well. Admittedly, his lecture is one long sales pitch for his pricey coaching/educational business, but a sales pitch I'd happily receive any time.

The allusion to stories is particularly descriptive, considering how Söderberg begins the entire lecture by reading a section from Alice in Wonderland. Over and over does he come back to the power of stories; when we tell ourselves certain stories, we tend to believe them, which prevents us from reaching goals that we might have or goals that we may set for ourselves. Yes, yes, I know what you're all thinking ("Oh, I've heard this cult-like mumbo-jumbo before"), but it's there for a reason: it works. It's true.

One of those stories is particularly apt: Why econ & personal finance matter. What if, Söderberg says, personal finance isn't boring and irksome and difficult? What if it's just a story we tell ourselves to justify not learning and not thinking about it? Same goes with econ. What if we tell ourselves that thinking about econ is simply Economism, the derogatory term people use against those of us who do?

Econ is the study of how to obtain most value from your life and not necessarily in monetary terms - how could that be "boring" and "difficult" and "narrow-minded thinking"? Some studie Söderberg referred to had estimated that, in an average month, people spend less time on their personal finance or financial decisions than they do brushing their teeth.

Why is it so difficult to engage people into econ, appreciate opportunity costs & division of labour and thinking on the margin?

Söderberg: well, things are basically fine. If you have a job in Sweden (or Australia or the U.K.) you're likely to be top 3% in the world in terms of incomes. Things are basically good. Why bother with 'excellent' if 'fine' is here already? So he hypothetically applies that thinking for his partner: "She's annoying and irksome and difficult, not very good-looking, but you know, she's 'fine', we have a pretty standard life - a good life - so I guess I'll stick with her for now." Absurd, isn't it?

Lastly, and with the highest honour, I can reveal to you that Söderberg agrees with what I've been saying for years: houses are not assets - they're liabilities. Söderberg redefines 'assets' to mean "things that put money in your pocket" (rather than "things that have a positive market value"); Everyone who owns their home know what we're talking about. The sheer effort, time, money and worry associated with owning and running a house spectacularly disqualifies it from being counted as an asset. And Söderberg's use of a balance sheet to infuriate people is epic:

"We buy debts in the belief that they're assets! We pay for them twice!"

His lecture was filled with countless other stories, from his own life and others. I'd highly recommend anyone attending.