Barefoot’s no fan of Mark Zuckerberg’s vision for the future

Mark Zuckerberg, the boy wonder billionaire, is losing for the very first time in his career but don’t get sucked into his ‘virtual reality’ vision.

Author and financial advisor Scott Pape is the Barefoot Investor.

Let me tell you about Mark Zuckerberg’s favourite book … and how it could change your world.

It’s a science fiction novel, written in the nineties, called Snow Crash.

And it’s actually become an underground cult hit in Silicon Valley, for reasons you’ll soon understand.

Here’s the premise of the book:

The global economy is in ruins, and governments have lost their power to a handful of giant corporations (sound familiar?). To escape their depressing reality people don augmented reality goggles and slip into an alternate internet-enabled universe, which they call … the Metaverse.

Zuck loves the idea of the Metaverse so much that he’s making it a reality: he’s not only rebranded Facebook as Meta, but he announced he’s spending ten billion bucks this year alone building the Metaverse.

Sadly investors didn’t like the idea of Snow Crash … and instead turned it into a share crash:

On February 3, Meta’s shares suffered the largest one-day crash in US corporate history. The internet giant’s shares plunged 26%, wiping more than $US240 billion off its market value.

And the great cyborg-CEO personally took a $29 billion haircut.

Interestingly, Bloomberg reported that Zuck held an ‘all hands’ staff meeting the following day where sources said he appeared red eyed, wore glasses, and warned his team that he may tear up because he had “scratched his eye”.

Uh-huh.

Facebook founder Mark Zuckerberg. Photographer: Andrew Harrer/Bloomberg

(Mate, it’s okay to cry, you just rubbed out two Gina Rineharts in one day!)

Here’s my take:

Zuckerberg – the boy wonder billionaire – is losing for the very first time in his career.

See, today, the most successful site on the web isn’t Facebook, or Google or Instagram, it’s Tik Tok.

The Chinese app is currently adding eight users each and every second, and the overwhelming majority are kids. (Meanwhile your Aunty Karen is ranting about face masks on Facebook.)

So, rather than compete head on with Tik Tok, Zuck seems to be doubling down on what made him a billionaire:

Capturing, and then exploiting, our attention.

“From the very beginning our main objective was how do we consume as much of your time and conscious attention as possible?” admitted Sean Parker, Facebook’s founding president.

And it worked shockingly well.

The average Aussie now spends 5.5 hours per day on their phone, which equates to 16.6 years – or around 33% of their waking life staring at a screen – according to a study by Reviews.org.

Yet it’s not enough. It’s never enough.

The next play is to suck you into your phone and engulf you in a virtual reality – the Metaverse – that you rarely come out of. And Mark Zuckerberg’s megalomaniac ideas (and those of his other tech-tobacco farmers) will control and monetise everything.

Okay, so I admit that this is all sounding a little like a weird sci-fi novel, so I caught up with a very successful tech entrepreneur I know, who cashed out of his last tech business for a cool $200 million, to discuss the Metaverse.

He put it this way:

Mark Zuckerberg adjusts an avatar of himself last year during the virtual Facebook Connect event where the company announced its rebranding as Meta. Photographer: Michael Nagle

“If you have a teenage kid, you have likely already experienced a version of the Metaverse: online gaming. Kids go into that world and don’t come out for hours … even days”, he said.

“Yet, thankfully, no one really trusts Meta …”, he said reassuringly.

But then he added:

“… however, if Apple releases its rumoured virtual reality glasses … humanity is screwed.”

Tik. Tok.

Tread Your Own Path!

So My Husband Spent my Redundancy on Grog

Dear Scott,

I just discovered that my husband of seven years, and the father to my children, has spent half of my $40,000 redundancy on grog and other rubbish. I suppose it’s my fault for trusting this man (a former accountant!) with our family finances. The trouble is, bill-paying gives me anxiety, and I am useless with numbers. I’ve always been ‘kept’. My question is: what’s the best way to set up bill payments and track where our money is going? Feeling very overwhelmed right now.

Renae

Hi Renae,

Let’s flip it.

Your stress and anxiety are coming from doubting your husband, and yourself.

I understand how overwhelming it must be for you right now, so let’s start at the beginning.

Step 1: Schedule a Barefoot Date Night. Bring a copy of my book, or listen to it via audiobook on the way.

Step 2: Set up your buckets. Look at your daily expenses that are going into your ‘Blow’ bucket and see how much, as a percentage of your income, that’s taking up, and go from there. You don’t need to do a spreadsheet. You don’t have to track every last cent. I’ve never had the self-discipline to do it, and I don’t expect you to either.

Step 3: Let me tell you a little secret: it’s not really about the money. Once you get on top of things it’s going to change how you look at your husband, and most importantly yourself.

Stuck in Reverse

Hi Scott,

My daughters swear by your advice and said I should run our problem past you. My husband and I are in our eighties and have had a reverse mortgage for 12 years, without paying anything back. We are getting worried that the longer we live, the less our three kids and their families will end up with when we are gone. I rang the bank and asked if they could lower the interest rate but the answer was “no”. Do you have any suggestions?

Launa and Reg

Hi Launa and Reg,

Reverse mortgages are the financial equivalent of a rottweiler dressed up as labrador:

Essentially the bank gives you a lump of dough, and you don’t have to pay anything back.*

(*But the bank charges fees, plus an interest rate that is generally higher than a home loan.)

Nice doggie!

The bite comes years down the track when people find that the bank owns much more of their home than they thought possible; they’ve experienced compound interest in reverse.

Because of this, reverse mortgages taken out from 18th September 2012 have had to include a ‘negative equity protection’ so you can’t end up owing the bank more than your home is worth. However, you may have missed out on this important safeguard.

Reverse mortgages are pushed on a lot of retirees without explanation.

The fact is that a reverse mortgage is a very complex dog, and one that was pushed on a lot of retirees without a lot of explanation. So, I’d like you to ring 1800 007 007 and speak to a not-for-profit financial counsellor who will be able to read through your contract and see if there are grounds to push back and negotiate with your lender.

Update: ‘Rich Girl Loses it All’

Hi Scott,

We met five years ago at a book signing at Dymocks in Melbourne. I told you that I felt like Barefoot was the financial parent I never had. I admitted to you that I was extremely spoiled, always getting whatever I wanted, whenever I wanted. That changed when I was 14 and my father died, and I found myself on the streets, where I had $1.92 in my bank account, and was at a crisis point … when I found you.

So let me give you an update on what I’ve been doing for the past five years: I have worked six days a week at a bookkeeping job. I have now saved up enough Mojo to cover my income for two years, which will allow me to study full time to get a Bachelor of Commerce. Never have I felt so free as I do now. Even better, my partner and I are about to buy our first home. Thank you so much!

Courtney

Hi Courtney,

I remember you!

I was wondering how you would go turning things around after experiencing so much trauma in your life.

And now I have my answer.

You Got This!

DISCLAIMER: Information and opinions provided in this column are general in nature and have been prepared for educational purposes only. Always seek personal financial advice tailored to your specific needs before making financial and investment decisions.

Information and opinions provided in this column are general in nature and have been prepared for educational purposes only. Always seek personal financial advice tailored to your specific needs before making financial and investment decisions

The Barefoot Investor for Families: The Only Kids’ Money Guide You’ll Ever Need

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Originally published as Barefoot’s no fan of Mark Zuckerberg’s vision for the future