The Uneducated Economist’s Journey
This week, Tim and Carolina talk with Simon Caron, better known as the Uneducated Economist, to discuss his journey to success.
More About the Show
The Build Perspectives podcast shares insider knowledge to build connections and community in the building materials industry. Tim and Carolina are friends, colleagues and former coworkers who love the construction industry and their clients, and want to share their passion and insights to attract future talent to the industry.
In this episode, Simon Caron joins Tim and Carolina to talk about how he got to where he is today, along with thoughts on the current industry and advice for those looking to joining the construction industry.
Getting Started
Tim congratulates Simon on being able to make such an impact across a really diverse listenership.
Simon never thought he would have made it to this level. When he first started his channel, he was just looking for somebody to talk economics with and share some ideas. It’s hard to find someone who enjoys a conversation about high-level economics. He started the channel for that purpose.
It took a while for his channel to gain traction. He would be happy if he got a dozen views and a single comment in the first six months. After some time, he started catching some attention. This last year, the channel really blew up.
He’s gotten quite a few subscribers and a lot of attention, making it an amazing ride. The whole idea of the channel was to give people an idea of what’s happening in the economy. He didn’t realize how many people would be interested, and he didn’t realize how much he was going to learn from it.
Simon credits his drive to failure. He tried buying a house in 2007, and two months later, the housing market crashed, and he lost his job in construction. He tried holding onto that house for a long time, and they were making payments there for seven years. With his unemployment, depression and debt building, he ended up losing the house.
When it was going down, Simon was questioning what was happening. He’d watch the news and think how he was losing his job, losing his house and having a hard time making payments. On the news, they talked about mortgage-backed securities and credit default swaps. Simon had no idea what these things were. He would Google search, “What’s a mortgage-backed security, and what’s a credit default swap?”
A friend of Simon’s gave him the book, “The Creature from Jekyll Island: A Second Look at the Federal Reserve” by G. Edward Griffin. Simon loves this book. He has a reading disability which makes it hard to read, but this is one of the few books he has finished.
After being exposed to the federal reserve and what they’re doing, Simon learned a little more about what happened with the housing market and realized that it was a lot of shadow banking and different things like that that took place.
He committed himself to do research every day. Every day, he reads articles. If he finds something he doesn’t understand, he reads it over and over again until he’s practically memorized it and learns everything inside of there until he finally gets a grasp of what they’re talking about. Then, he goes out and makes a video about it.
Is Uneducated Economist’s Content Well-Known by Other People in the Industry?
Everybody knows a little piece of it, but not everybody has the obsession level that Simon has. Everybody has a little tiny piece, but nobody has the level of thinking that Simon has with the people that he’s working with. That’s what makes him successful.
Simon knows that there are people out there that are smarter and in a more particular direction. For example, Simon calls the buyer of lumber to ask what’s the price supply. He is constantly obsessed with trying to get all of this information out of this buyer, who doesn’t realize how valuable that information is.
Simon tries to get that information out so he can talk about it in his videos. He will talk to other distributors as well, like someone distributing pressure treated materials or roofing guys. He starts pulling all of this information together, and it creates a different picture. He gets a different idea of what’s going on in someone who’s solely focused on one area.
Are Builders Interested in the Channel?
Simon talks about lumber at least once a week, if not twice a week or more. He gives that constant update of what he sees happening as far as the level of prices goes, especially when it comes to the retail end of things and comparing that to the futures.
Watching the future, there’s a little lag happening inside the retail. He gives that warning to the customers out there. People across the nation have called Simon and sent him emails, thanking him. They will say, “Hey, we timed that lumber purchase perfectly off of the information that you gave us.” Simon says what he says, and he is always glad if it helps save people money or offers advice on a good buying time.
One man said he worked a hedge fund over in the UK and said he made some pretty big money in the future trades but doesn’t know anything about lumber, so he watched Simon’s videos. Simon didn’t know if he really believed the guy, but Simon received a hundred dollars from the man, saying it was Simon’s commission for the job.
A lot of people are interested in the channel because of that up to date information about the retail prices and the future prices of lumber and how those are related to each other. A lot of people are appreciative of that.
Simon does have a bit of a contrary view about the real estate market, which seems odd being in the lumber supply industry. You’d think that he would always want to be optimistic about things, but Simon calls it as he sees it.
Having worked for two failed lumber yards because of recessions and downturns, Simon is really sensitive to the idea. When he sees something happening in the market that he finds obscure, he will call it out right away. Even if it’s something that he wouldn’t want to be true, he will still say it. Customers appreciate Simon warning them and being ahead of the game.
What Has Come out of the Channel
The amount of information Simon has gained has been incredible. When he started this, he never anticipated anything and had no expectations. He would put out a video and someone would say, “Hey, have you looked at this idea or theory? Have you checked out his blogger?” He would go and research those things and evaluate.
He never took an economic class, so when someone talks about Keynesian economics or Austrian economics, he never paid attention to those things. He just went with whatever he saw at the time. He doesn’t really have a style of economic theory that he follows or believes. He just looks at things the way they are and tries to state it out there as best as he can. He cuts through the noise.
Simon mentions how much his cell phone has done for him and how there is nothing that it can’t do. If you are broke, in debt, have nothing and say, “There are no opportunities out there in the world,” look at your phone. With that phone, you have all the opportunities in the world; you just need to know what to do with it. All the knowledge is out there.
You don’t need to go to school to get the knowledge; Google has it for you. You just need to have enough ambition to do research and spend enough time doing it. Anybody can do this.
Simon does mention that he is probably a bit more obsessed about it than most people would ever be, but his passion for it is the secret sauce.
Simon never really thought what he was doing was even valuable in that sense. The value comes in with all the perspectives. Simon learned everything from the comments. When he reads those comments, arguments and perspectives, he sits back and thinks about it for a bit. It gives him a clearer idea of what’s happening inside of the economy — just by the collective thought.
Don’t disregard anything and don’t accept anything as gospel, just try to take it as it is. He learned a lot, and that’s where the value really is: the community.
Key Dynamics
One of Tim’s favorite videos of Simon’s had to do with the lumber waste stream and how that secondary and tertiary market affects lumber prices. He was on the phone at a very intense level over the last week about lumber prices. A lot of feedback he received was out of the CLT (cross-laminated timber) world. He heard a lot about the burn logs and veneers versus dimension.
There is so much happening with lumber. A lot of people were saying, “Well, it’s all these wildfires that caused the lumber prices to shoot up,” or this other particular thing. In reality, it’s a culmination of an intense amount of stuff dating back quite a way.
Even as Simon tried to pick up ideas of what’s going on in lumber right now, he realized that the history of trade war with Canada and lumber goes back to the 1980s or even the 1970s from what he understands. It a common war between the two places for a long time about how much wood comes in and how much subsidy is happening on that cheap wood coming into the United States.
There’s a lot to think about when it comes to these lumber prices, but something that had happened during the lockdown is that mills were curtailing development. This is where the idea of what happened with the lumber was shocking because when that curtailment took place, everybody thought that there was going to be no buying of lumber at all.
Simon had even said it on George Gammon’s show. Simon said on the show that there’s something going on because the pressure treated is running out, and he couldn’t get his hands on it. There’s a lot of homeowners coming to buy this stuff, and a lot of projects are starting up during a time when you’d think everybody is locked down.
It was around a week after that video aired, and it seemed like it was all over the news about the lumber shortage. So, maybe they saw George’s show and decided to start doing stories on it. That is when things really started taking off.
Simon was thinking how at some point, the mills are going to start, production will fire up again and things will come back online, but it didn’t seem to happen in such matters. It seemed to take forever for the pressure treated to come back into stock. Simon was still having issues with getting lumber supplies in, and the prices of retail just kept going up, especially on things like plywood and the secondary markets like Tim was talking about.
Simon couldn’t figure out exactly why this was taking place. Why wouldn’t the inventory finally build at some point? He thought maybe at the end of summer it would happen. Building season would slow down and inventory would build, so maybe see the prices come down. It started to do just that, but then it kicked back up again and reached an all-time high.
When Simon went and started asking about what was taking place at some of these mills, he talked to an individual who had sent him an email from Maine. Simon wants to have him on his show to interview because he seems to have a lot of knowledge on this particular item. The guy said that it’s not just the wood lumber that these mills are producing. There are all kinds of products that they make. They produce pulp and bark, and they have all kinds of byproducts that are also part of their production.
If they do not have a market for that, then that’s half their product that they can’t get rid of. They’re in a slowdown, and they’re in a bind. Simone was amazed by that being potentially one of the issues that were taking place. Then, the kills: A lot of lumber that goes out now, especially through Simon’s yard, is all killing dry.
Those have limited space and time that it takes in order to get those things through. Unless you build more kilns, you’re stuck at a bottleneck right there. It takes time to get through the count, the same thing with the pressure treated companies. They have to dry it, treat it and then sit on it until it’s no longer a hazardous material.
All this stuff takes forever to finally get back into line again. Simon asked one of the local guys in Oregon about the mill they have, and about their byproduct. The guy says that they don’t have byproducts. Simon said to him that every mill has byproduct, but the guy said, “No, byproduct goes into firing up the mill or in firing up the kill, so we burn it all.”
Simon found that really interesting. It’s not just one thing or COVID or the lockdown. It’s the trade wars, the beetles, the wildfires, bottle-necking and more. How long it takes to get all that through the system — who knows?
Simon was looking today and the lumber futures were just about 900 per thousand. In the middle of winter, new all-time highs aren’t expected. Very strange times, indeed.
Tim mentions how this reminds him of Mike Rowe’s show on Discovery Plus called Six Degrees. He talks in one of the episodes about how beef and pork prices went down because the processors found a way to make violin strings out of tendons or whatever, and all these different things. They started selling to augment the pricing so that they could compress those prices of the pork and beef.
Over time, synthetic versions of those arose, so that contributed to the increase in beef and pork prices because there was less of a market for those secondary and tertiary things. There’s an analogous to the building materials industry, which is fun to consider, especially since micro is a big fan of the building industry.
Positive Relations
Simon doesn’t really deal with the manufacturers as much as he does with the distributors. He’s buying through a distributor who buys. When he sells a product, he wants to be able to stand behind that product with a lot of confidence. If he can tell the customer, “If you have any issues with this window, you call them. If you do not like the answers you hear from those people, you call me back.” If he never gets a callback, he likes that about the manufacturer. They can take care of the customer after their purchase and Simon will sell their product all day long. That is his favorite thing.
He is also big into having good business relations. When he contacts the outside sales rep who he can call by name with a problem, and they take care it without any issues, he really appreciates that. Anyone can always hit home runs and be cool all day, but when they deal with the problems, that’s when they show their true colors.
If they can take care of the problems quickly and easily and make everybody’s happy, then that’s going to make Simon happy. That’s where he looks for those relations. He wants a product that he can stand behind that you’re going to stand behind, and he wants friendly, comfortable service, just like everybody else.
A brand is not your brand’s colors, it’s the experience. It’s how people feel or don’t feel about their experience with you, with the reps and so forth. A lot of distributors take that to heart, but not all. If someone wants to do more, they should think about the customer experience.
Advice
Simon gobbles up all this information, takes the feedback and turns that into a product and information.
He says that you have to be a little bit insane to do the same thing over and over again, expecting a different result, but not getting one. He put out tons and tons of videos and got no response. For about six months, he had a channel that had maybe three viewers. There was nobody there, but he put out content regardless. When it did take off and the viewers started coming in, they started going back to that old content and watching. People would say, “Hey man, I watched all your videos. I watched you way back in the day. It’s amazing how far you’ve progressed.”
If you’re going to do something like this, it’s difficult to get started. It’s difficult to stay motivated, and you have to do it like you’re just doing it for yourself and nobody else.
As far as getting out there, social media is awesome. There are a million places you can post a video. If you’re really that passionate about what you said, and you want other people to hear about it, then go find those forums, go find those groups, go find the message boards and start posting your video.
Go to Reddit, Facebook, Twitter — go everywhere and just start posting videos. One day, if you have a video that’s worth it, it will start getting shared. Once it starts getting shared, you’ll pick up momentum. Once the YouTube algorithm finds it, you’re off and running.
It’s not a matter of putting out content every single day. It’s a matter of putting out content regularly and being honest about it. If you have a channel that has a bunch of animations, edits and different things like that, that’s cool. Simon wasn’t into it. He didn’t even try to do thumbnails for his channel; it just didn’t feel right. He is as basic as it can possibly get.
For somebody to want to start this thing, it’s not easy. You really have to be out there on your own for a while until you get noticed.
Simon is internally motivated, very passionate, very tenacious and persistent, but he wasn’t doing it for fame and money. He was doing it because he wanted to share that passion and that information he was learning. He didn’t want other people to go through the same things he went through, so while he was educating himself, he was also helping others. He had an inner vision and an inner drive that wasn’t money or fame necessarily.
In fact, when the first video caught attention, and it had around 800 views, Simon almost deleted it and the channel. He started thinking, “Oh my gosh, it’s too much notice.” In the early days, he called the channel video journal. Even if nobody watches, at least he’d have a journal of his own thoughts on YouTube. He considered it that and didn’t expect anything else until it took off.
Tim and Carolina talk a lot on the show about how some people think they don’t have anything good enough to share or anything worthwhile to talk about. Simon started just sharing, and has been really successful and will be even more successful because of what he’s sharing. He’s sharing at a particularly important time in the nation’s history. People need someone who is transparent and who is willing to call things out.
That’s also why Tim and Carolina have this podcast and call it Build Perspectives. They get all this information from the community and all different viewpoints, just like Simon.
Young People Interested in Construction Industry
Simon has been in the construction industry since 1994 when he was in high school. There was never a time through all that that somebody didn’t need some kind of construction done. There’s never been a time in history where a carpenter wasn’t needed. Simon doesn’t see a time where they will go unneeded. He’s never seen a time during any recession, even during the Great Depression, where they weren’t needed. There were some people who had a hard time finding work, but there was always a need for them.
If there’s a need, you have to find it. You have to be in it. He has seen a lot of young carpenters come into the game and do very well. They are very impressive, as far as how quickly they were able to gain their success.
There are others who he has seen struggle immensely. He isn’t sure exactly why there’s a big difference between them, but he has seen the realms of both worlds.
He sees a lot of new companies start up and feel that they have to put this image out there: They buy the new trucks with logos, gear, hats and all this stuff. He sees this as a mistake. That’s money that they have borrowed to buy these things. Most of it isn’t even productive. None of that does anything for you. You’re a young business that is now heavily in debt.
Then, in a few years, the company is gone. Was it the debt that got them? There’s another group of guys who started off working for another contractor, and they later went off on their own working out of one busted old Toyota. Here it is, five years later, and they are driving new trucks, have others working for them, have vans — that is impressive.
Simon advises not to stress too much on the image. Try and do the best job you can, and use word of mouth to promote your business. That is what he found to be the best for businesses around his town, at least for the remodelers and the single home kind of builders. If you really get a good name for yourself, everybody wants you, and you’ll never have to worry about work. Don’t worry about the image so much.
Whether you are working in a small lumberyard, working outside sales, working for a distributor manufacturer or whatever, keeping things simple and taking care of the customers applies across that whole spectrum.
Simon recognizes that there is a perception, visually. People think having that image is really important for getting a lot of sales. But to him, even in his channel, he didn’t try to show off an image that he wasn’t. In fact, he took it down to the bottom level as he possibly could to give everybody a very low expectation of what they were going to expect from the channel, then try to give the best he can.
The star of his show is the information that’s being shared. The rest doesn’t really matter.
Favorite Time Investment
Simon puts a lot of time into researching articles because now, with the channel being as popular as it is, he is in constant search of content to try and put out there. With the website going and trying to write up articles himself, it’s really starting to occupy some time. He will get up in the morning, make sure the family’s up, get the boys up, get ready to do their school, get some coffee, sit down and read articles for half an hour or 45 minutes, and then check his Google feeds.
If you learn how to use Google, it’s pretty cool because you can eliminate things you don’t want to see and show things that you do want to see. It really scours the internet and brings a lot of different articles. That’s one way to get it.
He usually does that in the morning and then checks emails again and goes to work. At lunchtime, he will try and bust out a video or do some more research. Afterward, he will hang out with the family for a little bit. If he hasn’t gotten a video, he doesn’t try to get a video out after work. He usually tries to spend at least an hour doing something with the family or playing games or something.
If his family is watching TV or there’s nothing going on, he will go on his phone, scan for articles and look for news. Where somebody would just sit around and watch TV, he looks for news.
Connect With Uneducated Economist
If you are wanting to follow Simon, search Uneducated Economist on YouTube. He has other social media, but he is not nearly as active on those. Or feel free to email him using uneducatedeconomist@gmail.com
His new website is up and running. He would appreciate it if everybody would go and check that out. Scroll around there and let him know what you think. That’s a great place to check out some of the news articles that he is reading. He will post three of his favorite news articles for the day there, and try and put out his own article that he writes.
Final Thoughts
Simon encourages people to do the best job they can, use word of mouth to promote their work, make a good name for themself — and remember that character is measured by how you respond to problems.
Simon went to his boss one time after making a mistake. His boss told him, “That’s why they put erasers on pencils.” You’re not going to be judged by your mistake. You’re going to be judged by how you fix it. Fess up to your mistakes and deal with them.
Join the Conversation
We’d love to hear your thoughts on this week’s episode! Shoot us an email at buildperspectives@gmail.com.
Show Notes
Social Media:
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Recommended Book:
- ”The Creature from Jekyll Island: A Second Look at the Federal Reserve,” by G. Edward Griffin
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