Investment Strategy: The podcast discusses the importance of adapting investment strategies to changing investor needs, emphasizing reliability, access, and foresight for lasting performance.
Market Dynamics: There is a perception of a bubble driven by tech CEOs, with Oracle's recent debt-fueled activities marking a significant inflection point in the market.
Company Behavior: Oracle's aggressive spending on AI infrastructure is seen as a catalyst for a potential debt-fueled arms race among tech giants like Amazon, Microsoft, and Google.
Sector Analysis: Unprofitable and pre-revenue companies, particularly in nuclear and quantum computing, are experiencing significant stock price increases, indicating bubble-like behavior in niche market segments.
Future Trends: The podcast suggests that the current AI bubble could transition into a robotics bubble, with tech companies potentially overspending on AI without immediate transformative results.
Market Sentiment: Despite concerns of a bubble, the podcast notes that valuations are not yet at extreme levels, suggesting room for further growth in the market.
Investor Behavior: There is a dichotomy in investor behavior, with significant inflows into retail markets alongside record levels of money in money market funds, reflecting mixed market sentiments.
Economic Indicators: The discussion highlights the slowing economic momentum but no immediate signs of a recession, with a focus on the implications of high spending by tech companies on the broader economy.
Transcript
This message is brought to you by Nuvine. What does it mean to invest like the future is watching? As one of the largest global investment leaders managing $1.3 trillion in public and private assets, New is uniquely positioned to take on tomorrow today. Combining over 125 years of deep expertise across income with innovative alternative solutions, Naveen adapts to the needs of investors as they change. Offering reliability, access, and foresight to its clients, communities in the global economy, all in the pursuit of lasting performance. Naveen. Invest like the future is watching. Visit noven.com/future to learn more. Investing involves risk. Principal loss is possible. >> Welcome to Animal Spirits with Michael and Ben. It is Tuesday morning, 8:00 a.m. Eastern, 6:00 a.m. >> Mountain time. Canadian mountain time. >> Mountain time. I think I'm in B with two Fs. Uh, so I'm not like a, you know, I'm not a ski person. >> Hold Hold on. That town, it's it's it's there's an N before the F, right? It's N, not Yes. With two Fs. I I've I'm not like a ski person so I don't know what to compare it to but I guess Aspen Jackson Hole something. It's a beautiful town with ski shalets and hiking and mountains and gorgeous. >> What are you doing? >> I am here to talk to a group of wonderful Canadian financial adviserss which we had a ton of at future proof. >> Yeah, we did. What are you going to be talking about? >> Uh I'm just going to talk about the future of financial advice. And it's funny, the Canadian adviserss, I feel like they're being a little modest, but they say, "Listen, we're anywhere from three to five to seven years behind the US when it comes to our advisor space and we want to kind of learn from you guys what the best practices are." Um, so that's what we're talking about in the mountains. It's a beautiful spot for it. So, I'm excited. Uh we are we're prepping for speaking of future proof the Miami one which uh a lot easier to get to for East Coast people. So I expect a huge turnout for for the second annual event there. And uh we're talking about potential musical acts. And am I excited? >> All right, we're just going to have to pay up for them, I guess, like we said last week. All right, so this feels like the I don't know. I It's never it it's hard it's hard to figure because you said last week you say everyone and you mean like yourself or but it just feels like we've turned a corner where I don't know how you could look at the behavior of companies and not think this is some sort of bubble that that's kind of my feeling that and but it's not this is not investor behavior bubble. I feel like this is bubble activity brought on by the tech CEOs. I feel like they're the ones who are pulling us, kicking and screaming into this whether we want it or not. >> Yeah, this week was an inflection point with Oracle and the debt that they're going to take on fueling this to like the next level, which we're going to get into in a second. But Ben, you mentioned like it's more of a uh company-led bubble, not an investor-led bubble. This is not a corner of the market that you concern yourself with, but there are a bunch of unprofitable in many cases even pre-revenue companies that are going literally vertical. Aqua, for example, it's a nuclear company or potential nuclear company. They have no revenue. Uh they're not even like there's not even revenue on the horizon. I was listening to the call the other day which a lot of it was signed so I I sort of skimmed a lot of it but the stock is up like I don't know 1500% over the past year something crazy and a lot of like the quantum computing stocks so that that corner of the unprofitable and in many cases pre-revenue slice of the market and Aqua is now a $20 billion market cap there is that is definitely bubble behavior but it hasn't spread to the $493 for example so it's it's weird because it's like a retail bubble in in the small corner of the market and then the hyperscaler lead bubble with the middle companies just like not sucking wind but sort of you know neither here nor there. Nobody cares. >> The weird thing we talked our in our ad read about crane shares has the robotics ETF. That stuff hasn't even really seemed to happen yet. I don't know how far off that stuff is from being a real thing, but it feels like the AI bubble behavior is just going to hand the baton over to the robotics bubble at some point. So me saying this feels like bubble activity is not me trying to say like all right that's it. >> Yeah. No, I know you're not saying that the bubble is is near its end. And of course >> nobody knows when the ride's going to end. I guess enjoy it while it lasts and maybe it lasts for another decade. Like literally nobody knows. But I would say that the news that we got this week or last week it started with with Oracle and and uh Open AAI that partnership. Um and there's a big wrinkle in there that we'll get to in a second. I would say that this is like the seventh inning of a baseball game. Now, the inning might go 20 the game might go 22 innings, but this was a definite like inflection point in the story. So, um, put some meat on the bones as they say. >> Wait, hang on. So, so my my feeling is that these tech CEOs, I don't know if they all get together and talk about this stuff, but it feels like mutually assured destruction where listen, we're all either none of us are going to do this or all of us are going to do it. If we're all going to do it, we're you're going to invest in you. I'm going to invest in you, too, and you're going to invest in me and we're and he's going to invest in you and she's going to invest. It's like everyone has to invest in each other. And and it's like it's kind of like a friend pact where you all took a pact that this summer we're going to do something and if you don't do it, sorry. You know, you have to jump off the bridge with us >> like American Pie but for tech dorks, >> right? They all took a pact it feels like. And it's like I'll invest in you but you have to invest in me too. and that it feels like it's just we're moving deck chairs around, but it just happens to be hundreds and hundreds of billions of dollars. >> By the way, my brother uh I have a brother that was born in 1999, the same year that American Pie came out. I doubt he ever saw it. If you're of that age, and my brother is Oh my god, 26. Watch American Pie. Damn it. >> How about this? That was >> That was the first ever millennial movie. >> Yeah, I believe that. Was that No, wait. It wasn't 99. Was it 99? It was 99 because I was a high school senior at the time. So, it like lined up perfectly for me. >> Yeah. Okay. >> My take is that was the first ever millennial movie. >> Yeah, I think that's right. Um, all right. So, Mark Zuckerberg said on uh a podcast last Thursday, if we end up misspending a couple of hundred billion dollars, uh, that was their market cap not too long ago. I think that is going to be very unfortunate obviously but what what I'd say is I actually think the risk is higher on the other side. Um he said the risk is probably Yeah. not being aggressive though. Yep. So uh Adam Parker has a chart showing total capex uh of the top 10 spenders compared to their dollars and it's yeah it's it's up and to the right and here. All right. So to me this is the main point in framing where we're at today. So Ben Thompson has a blog called Strateetery. He's one of the foremost authorities on on tech and innovation. >> I always think that his his substack sounds like or his newsletter sounds like Will Ferrell as George W. Bush. >> Oh, because you listen sometimes. >> Yeah. >> Uh oh. Um All right. So he quotes this guy Doug Olaflin. There is no way for Oracle to pay for this with cash flow. They must raise equity or debt to fund their ambitions. Until now, the AI infrastructure boom has been almost entirely self-funded by the cash flows of a select few hyperscalers. Oracle has broken the pattern. It is willing to leverage up to hundreds of billions to seize a share. The stable oligopoly is cracking. Uh the implications are profound. Amazon, Microsoft, and Google can no longer treat AI infrastructure as a discretionary investment. They must defend their turf. What have been a disciplined cash flow funded race may now turn into a debtfueled arm race. That's a vibe shift if I've ever seen one. Welcome to the next and newest phase of the capital cycle. I believe the Oracle quarter achieves something more elusive than just revenue. I believe Oracle has just sparked the elusive animal spirit to life. Uh I believe that for me Oracle is the quarter that we will remember in history. Wow. Um was there one other thing in here that I wanted to pull out? uh compare the spending of the big three with that of Oracle. Oracle is going to go negative free cash flow to win and it's likely that incumbents will respond. I believe it's time for technology incumbents to start spending a lot more and most have already indicated they will. So I read this over the weekend and I slacked you and Josh buy everything. This bubble is about to go nuts. S&P 500 10,000 then 5,000 or something like that maybe. >> Boy, it sure it sure feels like that. And as people who try to be level-headed, it it feels weird for us to say this kind of thing, but if you look at any any financial history book, that's what it would tell you. And the great point in that piece is that you're right. all this spending before was uh just from their cash flows they were making from their businesses which was which was so huge it didn't really matter that they could invest in this stuff. They haven't even really pushed their foot on the gas pedal. like if they want to, they could really ramp this up and say like, "All right, we're bringing everyone into a new era regardless of how you you feel about it." And and obviously the hard part to figure out here is like how far ahead do expectations get and when does the market want to return on this capital and blah blah blah. >> It's all we're all guessing, but man, this is this is a hell of a lot of fun, Ben. Um, so >> yeah, because eventually it's going to it's like you said it's it's some fringe companies now, but this it's going to eventually bring other companies into the fold. This is not just going to be the top 10 stocks in the mag seven forever. Other and it's not just going to be tech stocks. It's going to be other companies using these AI tools where you're going to have some companies say, you know what, we're laying off 20% of our workforce because we're going to see productivity gains from AI. There's going to be a company that's going to do that and it's going to shoot up 20%. And it may not work, but that's kind of stuff that's the stuff I'm is like the second and third order effects that's going to happen at some point, you know? Um there's countless examples over the last 10 years where we could look back to and pinpoint moments of us literally laughing at how big the numbers were when Apple got to a trillion dollars, right? Like that was the music was going to stop. It just magically was just going to stop at a trillion. Um, when you think about uh the spending of the hyperscalers, 300 billion, 500 billion, we're going to look back, we could look back in three years and say that was quaint. Remember when they were spending $400 billion and there was it was just funded by free cash flow. Um, and yeah, like when and where and how and all that sort of stuff like nobody knows. So, we're just going to document it in real time and do the best we can. Um, there is a there's a new high in the weight of of market cap in the S&P 500 for Nvidia and Apple now up to 14%. Which is that ain't nothing, Ben. Oh, you know what? It's probably time for me to update the pie chart, isn't it? >> It's getting there. The weird thing is is it feels like Apple is not participating in this stuff. >> Not in the AI piece, >> right? >> Oh, I did I did I did just, you know, I'm so oblivious. I just ordered the new phone. Um, there's a new model. Do do you know about the new that there's a new model? >> Yeah, I see the headlines and such. >> Okay. Well, I only just saw them this week. >> Gives you like 3% more battery probably. >> I don't know. I ordered one last week only because my iPhone was like breaking cuz I'm an idiot. I didn't put a case on mine and I just had cracks all over the place. Uh but the iPhone 17 is in high demand. Like Josh told me he tried to order one yesterday and it's not it's backdated to like October 17th or whatever. But yes, they are buying the in the AI stuff. Anyway, >> hang on. I got one more thing from Ben Thompson. He he interviewed Burn Harour a while ago. remember he had that new book on bubbles and he and he said this is this is Hobart what bubbles do is they create one of those clusters in time rather than space where this is a time where everyone is doing this thing and so this is the time to do it if you know that people are building other elements they're building parts of the infrastructure that your thing needs to be built on then it's actually less risky to build so Amazon was a less risky business because AOL was massmailing their discs and telling everyone get on the internet then AOL became less risky business because Yahoo is giving you stuff to find in the internet blah blah blah eBay and that's what led to the whole internet stuff. So that's the reason all these companies are doing this because listen, if they're all doing it and we're doing it, it's like we're going to make this a thing and and AI is going to I guess the one thing I would try to say is that like what if just they Zuckerberg is right and they sp they overspend by a few hundred billion dollars and AI isn't this thing that transforms our lives now. It maybe it just slowly but surely becomes a bigger piece over time. Um >> I reject that part. I think I I think the the coming transformation is inevitable. And >> no, I'm saying what if it doesn't happen in the next 5 years? What if it's more of like a slow thing where it's like in the next 10 to 15 years life changes, but it's it it doesn't it's not like there's this point in time where it's like, oh my gosh, life is so different. It it happens. It's more of a slow burn. >> I think it's going to be more overnight. I think that there's we're going to wake up one day and say like, wait, I don't think it's going to take 10 to 15 years. I I think I think that's a possibility that that >> Listen, I think I think it's easy to point out a million different risks. >> No, in a in a bubble, it's easy to think like life life is going to change forever overnight. That's how that's what bubbles make you do. That's that's why I'm trying to temper it by saying like cuz everything we got from the dot bubble happened. It just didn't happen right away. Remember, everything that they wanted to happen and more happened, but we had to go through the dot bubble and then YouTube came along >> and then all the other stuff and it took some time. >> Um, thanks. Think things happen so much faster today. >> That but that's why this is a really fun time to think through though. That's why all of these companies >> all of these companies that get to a hundred million and a billion dollars in revenue, it happens so much faster. Just it just does like that chart a million times. >> I and I keep seeing these people saying, "Listen, >> it's not going to take 15 years." >> I I keep seeing people uh in the tech world say, "Listen, there's going to be a company with one person that's going to be like a billion dollar market cap." >> Yeah, I believe >> everything they do is is AI based and it's one person running the company. Maybe. >> Uh, all right. Uh, MAG 7 from Biano, new new high in the S&P 500 that they're 35%. Where does this stop? Don't know. We'll see. Um, all right. Uh, another derivative of this story is is data center energy consumption. Zakari tweeted tweeted this chart from uh Bank of America. US data center energy consumption and a uh as a percent of total US power demand uh 4% and 23 4.2 2 4.5 4.9 5.5. >> So, uh, >> at what point do we get the AI backlash of people saying, "Wait, why is my electricity bill so much higher?" >> Yeah, >> someone's going to be on that corner. That's going to happen. >> I saw a lot of people tweet about that this weekend. People are people are sticking their claim there. It is funny though that um technology is usually deflationary, but as of now, you could make the case that this AI bubble has been inflationary because it's it's it's led to higher mortgage rates and it's led to higher electricity costs. How about that? >> How has it led to higher mortgage rates? >> If these companies weren't spending I I blame Mark Mark Zuckerberg for higher mortgage rates. If they weren't spending all this money, there's no way rates would have kept been so high. >> Oh, because the economy wouldn't be as strong. Yeah, I buy that. >> Yeah. Um, okay. Valuations, who cares? You want to talk about this? >> That is true. Uh, it's just it it's showing that like the the rest of the market, to your point, has not come along at all. So, the equal weight's trading at 17 times. I don't know how you could look at that and say this is a a crazy bubble. Uh, >> dude, valuations don't matter until they until they do. I know. Very profound. >> Yeah, they Yeah, they you're right. But I guess throw them out the window. But it's it's not my whole point is that valuations can get a lot crazier if this thing is going to go. >> They're not crazy though. That's the thing. We we're talking about the story. We have like in Nvidia's what's Nvidia forward earnings. It's under 30 I think. >> Yeah. That that's if you put all the >> those are rookie numbers. What is >> max together? They probably I think they trade at Yeah. Let's call it an average of 28 or 30 times earnings. >> I think maximum is a little bit over. It's not crazy. >> It's not insane. That's the point. It could We still have room to get insane. That's the That's the point. remember um remember April? >> Like I feel like >> feels a couple years ago. >> Life is moving so fast we just like whitewashed the fact that we had like a massive tariff tantrum and a really quick bare market. Um so we have this chart on exhibit A for advice.com for advisers. What if you panic sold and missed April 9th? Now we mentioned this when we first shared this chart. Obviously, I would maybe say that there's one person on the planet Earth that sold on April 8th, uh, saw April 9th up 10% and said, "Oh [ __ ] I'm going to buy on April 11th." Right? Like, nobody did that. >> There's got to be a Reddit post out there that someone of someone who did that, but you're right. >> That is psychotic behavior. I can't imagine the type of maniac that would have panicked and then panicked a day later. Just doesn't happen. Um because obviously the feeling of like this is fake, I missed it. All right, whatever. Anyway, the point is this. If you did that and were psychotic enough to go all back in the next day, the S&P is up 13.5% year to date. Whoa, it is. Uh well, if you miss that one day, you're up 3.7%. Buy, >> hold, or trade like your life depends on it. By the way, did you listen to the Tom Sashnoff TAFF? I did not yet. >> Okay. >> I was another busy weekend to be with child sports. >> What a vibe on that guy. Just great energy, great feedback from the audience. He was uh he was a lot of fun. >> I mean, based on the hat alone, yes, the guy has a vibe in the hair, right? >> Yeah. Um all right, somebody emailed us. I'd be interested in your take on this info and advice on how one >> Wait, did he did he make you want to become a trader again? >> Um no. I I don't have time for that. And I I I've done that. Like that's a whole that's a for me that's a that's a slippery slope, my friend. You know, that's true. You were telling me before that you're not even going to sports gamble anymore this year. Maybe you're like turning over a new leaf. >> Well, I lost. All right. >> Wait, we shouldn't say that because you and I are going to Vegas in like six weeks. >> Yeah. So, I I I said to myself I was going to deposit money for the season into my FanDuel account and when it's gone, it's gone. That's what I was That's what my plan was. And it just so happened that um life got busy for me. So, I bet I lost 500 bucks on the Eagles. Who did they play opening night? Eagles Cowboys, right? Was it Eagles Cowboys? So, I teased it to Eagles minus 2 and a half. I think they won by four. And I teased the overunder down to 44 and a half. Now, I was telling Tom Self this. I don't do like plus 400 bets. All right. So, the Eagles were favored by four. I bought it down to 2 and 1/2. The overunder was like 48. I bought it down to 44 and a half and now it's basically even money. So they scored 41 points in the first half. Um there was that lightning delay that lasted for like an hour. I fell asleep. I woke up. The Eagles won by four points. So my my spread was good. In the entire second half, Ben, they kicked one field goal. They scored 41 points in the first half. They scored a field goal in the second half. So my overunder that was 44 1/2 I missed it by half a point cuz I only scored a field goal in the second half. So I lost 500 bucks on that. And then week two, I don't remember where I was, but I just I haven't gambled in the last two weeks. And I said to you before we started recording, the Giants are a piece of [ __ ] organization. I'm only wearing this hat because it's closest hat available. Um I might take the season off. I might just check out. I am so disgusted with this team and I'm numb and I'm mad and I'm bitter. I didn't watch week I I didn't watch a Chiefs game. and I saw it for like 3 seconds. I have no interest. I have no interest. I'm just >> This is a good time for you to to be moving. I would love you know how they've done those studies in the past like Teran Soden did this study where he got a hold of brokerage information and showed how bad people are at actually trading stocks like the and the results are worse than you could ever imagine. I would love it if someone could dig into the FanDuel DraftKings data cuz I got to imagine that >> treasure trove. >> There are so many awful awful betters out there. I the the loss rate has to be probably even bigger than most people think. Oh my god. Uh, so, um, anyway, so I might take the season off. I might just check out. So, because of my audiobook addiction, I'm no longer listening I swapped one addiction for the other. I'm not listening to the to Ringer podcast anymore. So, I like loosely am following the NFL, but not really. Um, but I wonder for week by week seven, I'm like, "Yeah, I don't know what's happening." Which is a a hell of an a bad face for me because I've been obsessed with the NFL my entire life. You're transforming before our eyes, you know, listening to audio books. No more gambling on sports. >> I am. I am. But it's it's really because the Giants are trash. Trash, trash, trash. Um, and I'm going on on on Sunday, >> which is I can't wait to boo. Only go to boo. Uh, speaking of bad betting, and sorry for the tangent. I know a lot of people could not give one less of a [ __ ] about >> Yeah, let's talk about your fantasy team after this. >> Yeah. No, I know it's very riveting. Um, uh, Black Rabbit, the scene where he where Jason Baitman is is gambling. Like people gamble like that, maniacs. >> Yes. Yes. Absolute. Yes. Those people have issues. You want to talk about this passive stuff or not? >> Yeah. So So real quick, I I know we've beaten this this horse to death, but I thought this is just worth mentioning. Um, all right. Uh, on one hand, passive investing is low cost, but holds broader long-term systemic concentration risk per slack. That's tors and slack. But on the other side, you have historically underperforming active management with higher fees. Would the more expensive active manager potentially avoid the systemic concentration risk and earn their fees plus some in avoiding the full impact of a significant systemic market correction or would they be subject to the same challenges and the investor would just pay more for the same outcomes. Um so he he included a chart from Torsson Slack that shows almost 55% of ETFs and mutual funds are passive. Now, >> right up from 25% in 2012. Um, if there is a marketwide meltdown that follows the path of the dotcom bubble where tech is the epicenter and the hyperscalers burst because they're overspending and investors preference change and all the promises didn't come to fruition, then yes, I would expect a lot of active managers who are underweight to significantly outperform. >> How many of active managers do you think are still underweight though? I feel like so many of them have been pulled into this. >> Okay. Well, I I do think a lot are still underweight, Ben, given how much how many of them are still underperforming, >> which sort of true, >> which which is in stark contrast which one I'm about to say, which is that active managers set the waitings. So, I don't know exactly how to square that circle, but yes, I would expect the underperformance to catch up dramatically if there were a techled meltdown. Would you agree? >> Here's here's the thing though. You don't need active managers to do that for you. you can invest in value stocks, high quality stocks, dividend stocks, small caps, all that stuff is probably going to do international stocks is not going to get hit nearly as bad if this hyperscaler stuff blows up. So, you don't need active managers to diversify for you. You can do it yourself easily these days. >> We are I think Jonathan Clemens would smile to hear us say that. Jonathan Clemens, uh, rest in peace, passed away earlier this week. He was a longtime columnist for the Wall Street Journal. Um I think he I think he gave the baton to Jason Zwig, right? I think Jason took over for him. >> Yeah. So yeah, I read all the pieces. Jason wrote a nice piece about him. He wrote his own piece kind of going through his life story. Um he was a nice guy 62 years old. >> I the thing I really always respected about him was that he was a stick to your guns kind of guy. He never like wavered and said like, "Well, what about this and what about that and let's look at all sides of this thing." And he was he had his beliefs and he stuck to them and he almost like for his readers, he was like, "No, you're you're coming along with me and you're doing this too." And uh I got a lot of really nice emails from him and traded and talked to him occasionally uh even over the last year as I was going through a period of grief. I traded emails with him about what he was dealing with and uh just the the nicest guy and he handled it with such the whole period with such grace. It was really like really inspiring to see. >> Yeah. So, rest in peace to Jonathan and uh obviously condolences to his family. He I only had the pleasure of meeting him once, but he was definitely a wonderful person and helped uh countless readers along their financial journey. Okay. Um, all right. Let's let's uh transition to investor behavior on the opposite side of of what Jonathan preached. Um, all right. Retail imbalance. This is from uh daily chart. All right. Here's a via via via for you, Ben. Um, Goldman Sachs via zero hedge via daily chart book for me. Largest weekly inflows since December of last year. There is definitely there's definitely animal spirits in in pockets of the retail world. And it's so weird. We keep talking about this this dynamic and the dichotomy in the markets of like um the American Association of Individual Investors and the Schwab Sax report that are sort of like showing you know signs of euphoria and then um this corner of the market retail traders like going absolutely berserk. >> Well, how about this from the Wall Street Journal? $7.7 trillion in money markets. How do you square that? >> Yeah. Well, I think I think >> if you look at the the assets in money market funds, that chart that to me looks like, oh my gosh, this is a crazy like bubble-like behavior or whatever. Maybe we're throwing that term around too much, but it's it's there's a lot of different things that you have to your brain like the cognitive dissonance is really >> you have to hold several ideas at the same time that are in that are in in conflict with one another. >> Gold at all time highs, money market funds at alltime highs, but also the crazy AI bubble stuff. How do you how do you square all that? >> And the slowing economy. We haven't spoken about that yet. And and rate cuts. Um >> stock market doesn't doesn't care about the economy. >> True, true. Um yeah, it's it's a it's an interesting time to be a market observer and participant. So Nola says, "The NASDAQ composite may have just made a new high, but it is nowhere close to our simple rule of thumb to identify unsustainably high prices. A double is a bubble." And it's not been a double. But it's so funny. You see, you see like there's so many different charts that people are like complacency, euphoria, mania. Why aren't people uh chasing? >> Is he saying it has to like double over the course of a year for it to be sort of bubble-ike or what what's the >> Yeah, he he he's showing that this is this is nothing compared to the prior mans, >> right? >> So, even though those those unprofitable or in cases pre-revenue names that we mentioned earlier are going bananas, a lot of names have gone sideways. >> The 2022 thing is the hard part to square with this. the fact that a lot of these companies fell 40 50 60 70%. That's the weird thing here, but that was kind of before the that was before Chat GPT really. >> Yeah, >> Chad GBT stopped that from so it's >> so the the S&P is going to 10,000. Uh I I can't I won't dare to put a a year on that. >> Um let's just say it happens in our lifetime, but I think it's I think this bull market takes it there. Needless to say, there will be corrections and bare markets. It's not going to be a straight line. Um, >> so wait, how much that that so from current levels which is I don't know 6700 to 10,000. So you're talking about >> a 50% move higher or so. >> Not even. >> I'm doing the math here. >> Isn't that like 35 to 40% higher? >> Math. Hashtagmath. I What? Yeah. Wait. 35 to 40. My bad. All right. Do I dare do this on the internet? No. No. It's a percentage higher. It's a percentage higher. And guess what? You tell me what it is. I don't care. I'm not doing this. >> But the funny when you say S&P 10,000, it seems like, oh my gosh. But then when you do the percentage, it's like >> uh all right, it's 50%. >> Yeah, that's what I said. >> You're right. That's like two more. By the way, I'm helping my my daughter is in sixth grade and she has math homework and it's stuff that I haven't thought about in forever and she'll send me a pro like it's kind of funny how awesome technology is. I was on a plane last night from Detroit, Michigan to Calgary. And in the in the flight, I'm getting text messages from my daughter about her homework. I help her with her math homework. And um I I will do the problem and I'll say, "Hey, I'll help her like think about these three things, but then I will always like take the problem and upload it in Jad GBT just to check my work." Um and it's kind of amazing. I'm how many thousands feet in the air asking AI to help me with my daughter's homework who is 500 miles away from me or something. and I'm relaying that back to her. >> I wonder if as I use AI more and more, specifically the LLM models, the large language model models, that's like ATM machine. >> Yeah. >> Um I feel like I'm like doing more than ever and I'm just filling the time and now I instead of like I'm just cramming more work into the work. >> We're not going to become we're going to become more efficient. We're just the same as on hours. >> There's a name for this productivity. >> We're doing more with we're getting more I'm getting more work done in the same amount of hours. I'm doing my output is at an all-time high and it's not even close. >> Could you really see Americans going from 50 hour work week to 30 because AI makes us more productive? No. >> No, we're not Europeans. All due respect. Love the croissants. >> But also the cool thing is though like the the it doesn't just give you the answer, it shows you how to do it. Like for my daughter, like I'll I'll tell her like look at this. And so because she and she herself, she doesn't just want the answer. She wants to know how to do it. Which I really like because she's like, "No, no, no. Don't just tell me, show me." And so she has to see if we ever put it. And we do chat GBT at the end. Like I tell her, "We got to work through it first, then we're going to put it into the AI." And she has to see the work that it goes through. But it it does show you. It'll say, "Take this and start with this and then then narrow down to this." And it is pretty uh pretty amazing. They're just going to grow up with that. All right, back to the money market thing real quick. You've talked forever about how that money is sticky. And I think it could be because I think it's probably mostly baby boomer money. So they interviewed people in the Wall Street Journal. Tom Ward, a 64-year-old executive recruiter in Michigan said, "Re's going down is not going to chase me into stocks. I really don't have a problem sitting on the sidelines." And he has 40% of his SP goes to 9,000. Let's check back with Tom then. >> Um, so this is interesting. This is from Brian Jacobs, friend of the show from Aptist. Anytime you have a society with more wealth, you would expect them to hold more cash. people hold cash for the cushion, not because it's yielding yielding higher than assets. And it could just be that like the low the low we saw in money markets in the 2010s was just the fact that rates were so low and unless we somehow get back there that this money even if it gets down to 3% or 2%. Probably is kind of sticking. I think a lot of people have decided I don't I saw what happened to bonds in 2022. I don't want that. I'm just going to hold cash in T T bills, CDs, whatever that is. I think there's money markets. I think there's a lot of that to this. >> Well, Brian's exactly right. And anytime you see this chart, you have to adjust. You have to adjust for percentage of S&P market cap or something. >> Yes. For what? There has to be a denominator. You're right. >> And to your point, it's like, all right, I want cash. I have all this money in the stock market. I want cash. And when you do that, the 7 trillion or the whatever it is, it look all of a sudden it looks a little bit less. But that that's why it's also hilarious to me that people say, "Just wait when the stock market rolls over cuz the top 10% are spending 50% of the economy. Just watch out. The economy is toast." Guess what? Guess who's going to be buying stocks when they fall? >> The rich people. >> But the top 10% they still they're going to be the ones who are buying. >> They're not getting nuked. Speaking of this guy, there were two there he is in the first couple episodes of of Black Rabbit and it's the virus is spreading. >> You sent it to me. I I totally missed it. Also, >> by the way, this is not this is I'm just uh it people say this all the time. I'm just pointing it out. It is common vernacular. >> Oh, you're right. Trust me, every time the dads on the soccer sideline see each other, you get one of those. Hey, there's that guy. Hey, it's Of course. >> Yeah, it's great. Yeah, see it all the time. >> All right. Um, I follow Rob Wilson on Substack. Uh, and he posts about retailers and the retailing industry. We got a report last week. Non-store retailers, which are that's e-commerce. Huge huge growth. 2%. Is that what is that month over month? Can't be. Right. Can't. >> I think I accounted for 1.5% of this gain. I I I I don't couldn't tell you the last time I bought something at a store. It's been years. >> So I uh I opened up Chat GBT and I said, "Make me a chart of non-store retailers." This is a percent of total retail. Look at this chart. Two seconds. And we saw that crazy. So obviously it was trending higher. Duh. And then you saw the spike in 2020. You saw a cool down. Now it's coming back. I mean that's >> it's amazing that it's right back on trend. >> That's pretty wild, right? So, because remember everyone said, "Okay, we're pulling all this stuff forward from the pandemic." We did, but then it went right back to >> We should have had to draw a trend line. Nature finds a way. >> Look, it's a it's a it's literally a perfect trend line. >> So, I was going out to dinner. I went to dinner last Wednesday and it was like a niceish restaurant and I was wearing a future proof, one of the green future proof t-shirts and I said, "Ah, [ __ ] I should probably should probably change buy a shirt." So, I was walking to uh dinner and I was going to stop in Macy's and buy something with a collar. And on the way over, >> dinner at a mall. >> Can't call it a nice place to be dinner at the mall. Sorry. >> No, no, no, no, no. I was going to stop on my walk. I was going to run into a Macy's. >> Oh, okay. All right. >> On in Harold Square. >> Okay. So, you're Okay. I got I was making sure you're not walking through a mall dinner. Although uh there are uh what's the mall in Columbus Circle? There's nice restaurants there. Anyway, >> between an indoor and an outdoor mall, though, too. So, >> there's no outdoor malls. That's a thing. It's an outdoor mall. >> Outdoor mall. It's in nice places. >> Okay. Oh, that is true. You're right. You're right. Uh the Grove, I believe. >> Yeah. Okay. >> Really nice outdoor mall in Naples, Florida we saw last year. So, I passed a Banana Republic and I feel like you were a huge Banana Republic guy. Were you not? >> Oh, definitely. Yeah. >> All right. >> Guilty. >> So, yeah. I feel like Banana Republic was always like a stretch store for me like in in in high school like if I wanted something very nice and uh I would use I think when I got that >> Yeah. I graduated from GAP to Banana Republic after college. I think that was >> Were you a big Abberrombie guy? >> I surprisingly I was never an Abbercrombie guy. Uh, >> you know the you know me, >> you know the Vince McMahon meme of like it's three of him like like >> Yeah. >> having a a explosion on his face in PG-13 terms. Feel like for you it was like J Crew, Banana Republic, Hollister. What was it? >> No, J Crew was always top of the line there. >> Oh, yeah. Okay. >> Oh, yeah. That was always the >> Well, anyway, my point is this. Did you I didn't even know the Banana Republic was still a store. So, I went in and I bought a button up or down. We won't relitigate this, whatever it is. And it was a perfectly nice shirt. Uh, I saw the tag. $75. Oo. 50% off. Done. 37 bucks for a a shirt. Guess who's not participating in e-commerce? That store. Those guys. What do you mean? Sure they are. You know, you buy people buy stuff online at banana.com. >> A a nice shirt was $37. >> Oh, yeah. You don't buy stuff from those stores unless there's a sale. And they always have a sale. >> They must be getting absolutely torched. >> I That's a Public App. Uh >> Oh, yeah. That's right. I remember back in the day. That was like I remember that was like one of my earliest like business memories when I learned that Banana Republic, Old Navy, and The Gap are all owned by the same company. You were like, "Wait, they could do that?" So, here's a good segue because that is like the higher, middle, and lower classes of the economy back in the day, right? >> Yeah. >> Okay. Two-speed economy is back as low-income Americans give up gains. We've talked a lot about this, but it's after tax wages uh change from a year earlier and the higher end is going up. Middle is kind of stuck and the lower end is going down. And this is something we've been talking about for a few months now that this is a total sea change from where we were in 2021, 2022, even 2023 when the lower end was seeing the biggest gains. There's a bunch of quotes in here that maybe you can pull from. But my only big takeaway here is that there is never ever going to be an economic environment that's going to make everyone happy because it was the higher end that was unhappy when the lower end was hanging big wage gains because it was like, hey, I I own these things or I my margins are getting hit. >> There was a white collar recession. You're right. Yeah. Now it's reversed and there's just literally there can't be an economic environment that everyone's happy. It cannot exist. >> Yeah. One of the quotes in here that stood out to me was um the premium cabin revenue for United Airlines was up 5.6% while the economy cabin was negative. >> Oh yeah. That which makes sense to me. >> Yeah. You know that but that's that's a really good bow on on all of this is that >> but don't you think part of that increase is the fact that they can probably charge rich people more because they know that they'll pay for it. >> Yeah. But there's well but there's also more demand from rich people. It's part of the same thing. You know Josh's book was based on this that what was Josh's book that or his blog post? >> Well, he wrote Yeah, he wrote the blog post out coming out of COVID saying >> they didn't want you to see that >> if we if we gave everyone money like we did in CO it broke the economy essentially. That was his Yes. >> Oh, you weren't supposed to see that, right? That was it. >> And Josh's point was, yeah, you weren't supposed to see that. That was Josh's book based on that blog post. Um, >> when everybody is is winning, we all lose effectively that like that broke the economy. Too much winning. By the way, the Charlie Sheen doc, speaking of winning, it was kind of weird that it was and it was it was entertaining, but they didn't like go into like why he was so insane >> because he was an actor in Hollywood for >> I know, but like why was he so damn destructive? I mean, they get into it a little bit. >> Bizarre. Anyway, um >> Ryan and Sonu have this chart. They have a proprietary leading economic indicator index. and slowing economic momentum, but no sign of recession yet. >> What was the thing Neil Da said about leading e economic indicator? Aren't they all kind of like back filled essentially? >> Well, this is proprietary. >> Okay. Well, >> maybe maybe you missed that part. >> All right. What's this? You have a new substack here. Oh, so a listener created a substack called Chart. Chardonnay. Yeah, it's a play on words. Chart. >> Okay, that's actually not bad. >> I remember someone early on said, "Why didn't you call it a Wells of Common Sense and spell it C E N TS?" Because then I would have to punch myself in the face if I did that. I No, sorry. >> You ever see this chart before? >> Chardonnay. That That's pretty good. I've never heard that before. I I'll give I'll give him credit. So, I was I was poking around uh his substack and there are some wonderful looking charts. So, the one that I pulled out for today is he breaks down he shows a bubble chart of the monthly inflation rate by decade and he shows uh it's it's gray circles and then the blue is the average and then the red is the most recent one today. Isn't that wild? >> It is kind of funny. People are talking about inflation heating back up when it's like 2.9%. And that is below historical averages. To your point, like if you showed someone this chart and said inflation is heating up, you'd go, "No, it's not." >> Yeah. I think just >> from what >> directionally is, but this is a gorgeous chart. I've never seen it laid out this way. >> Yes. I like the little charts. Good job, Chardonnay. >> Okay. Um let's get rid of this. So, I last week I went on a bit of a tirade about how annoyed I was from that Financial Times article. Just pure horseshit, >> you know, really got you going. >> It really did cuz it was just it's just so it's just the perfect representation of everything. And sorry to pile on them specifically because they're certainly not alone in this. Um, and I understand the motivations and why they have to do that, but man, it just grinded my gears because it was just such nonsense. They led, for people that missed last week, they led with an inflammatory statement about private credit that pedes are pulling back and they had on the cover, the Cincinnati pension fund CIO, they managed $3 billion. And then the footnote at the end was like, but not all they're convinced, but but but uh not all they're slowing down. New York City pension $300 billion says they're uh all in or or permanently committed or whatever they said. And the article was backward. >> Also, I don't I don't blame the authors for that because the people who write the articles do not pick the headlines. The editor or whoever runs the >> Okay. But the article that's true and also the article was backward as well. which if it was telling the truth, it would have led with New York City and then it would have said, but not all are convinced that the momentum is going to continue. Cincinnati's blah blah blah. Okay. All right. Anyway, so I wanted to get that on paper, but I just I'm moving. I felt lazy and I just wanted to see what Chad could do and it wrote a pretty damn good article in a second. Now, it was apparent to the reader and myself that I didn't write it. So, I wasn't trying to like pull the wool over anybody's eyes. And at first, like I felt like, oh, this is lazy. I felt dirty sleazy. Not sleazy. That's the wrong word. Um, misleading, whatever. I didn't feel great about it. But you know what? This is just what it's going to be. Like >> I felt sleazy reading it though after. >> But here's the thing, though. When I >> This is But this is just what it's like the the genie is out of the genie is out of the uh the lamp >> and it's not going back in. >> Uh but here's the thing. Like I even on Grammarly all so I have Grammarly because I I have Grammarly and I still somehow get um grammatical errors in my post which I don't know how but and I have one guy I told you who's for the last seven years has sent me, hey Ben, there's a grammar error in your blog. Fix it. He right away >> you are too nice. >> I can't believe that you still allow somebody to to fix your grammar. It's just like dude buzz off. So, I forgot to mention >> No, he's he's a very nice He never says it in a there's because people will say it in a condescending mean way and then then you tell him to buzz off. But this guy is very nice about it. I'm sure he is. Here's the thing. >> No, wait. No, wait. You're very nice. Uh you told me on your trip out to California that a lady next to you, was she on her speaker phone and the flight attendant came up and told her to knock it off? Most other Americans, certainly outside of the Midwest, would have turned to this woman and said, "Lady, no, I'm just kidding." It was, "Excuse me, do you mind?" >> It was a lady behind me. And everyone was doing the look behind like like and finally the flight attendant said, "Ma'am, do you have any earbuds?" And she said, "No, I don't." And late and then the flight attendant very sternly said, "You're going to have to get off speaker phone now." And everyone was like, I wanted to stand up and clap. It was absolutely amazing. But here's the thing. When Grammarly gives me the things to say, and you're you're to your point, you can tell that you didn't write this. It was chatty. Like, when Grammarly says, "Change this from this word to this word," I always think I would never in a million years write this word. >> So, I'm not going to use it cuz it it it doesn't sound like me. >> Yeah. >> But that's the thing that this is why the AI like being a commodity, >> you're if you want to stand out, you have to be creative and have your own voice. Now, you can't just do cuz Jet GPT, if you want to sound smart, is going to be smarter than you. >> Yeah, I think you're right. I wonder if people just start tuning out to think things that are obviously written by Chad GBT. >> Unless it's like a news story that they want to be caught up on, but if it's an opinion piece, I don't want to read an opinion piece by Chad GBT. I don't care. >> Of course not. Of course not. Um uh so Mike Shields, I'm not familiar with with who that is, but uh our friend Alex Canitz had him write a post on his Substack talking about, >> you know, you are like a you are pushing a lot of substacks today. I feel like this is an alltime high for Michael's substack recommendation. I I love supporting the artists in our industry. These are great creators and I pay for all of them. >> It is funny. I can't remember someone at Future Proof asked me saying, "Hey, I want to start a Substack. I'm a little nervous about charging money." And I said, "Dude, everyone does that now. This is this is not the kind of thing where people are afraid of it anymore. Like if if you have something to say and people want to read it, people will pay. You shouldn't be shy about uh charging money if this is going to be part of your >> Is that kind of crazy? Hey, I'm afraid to charge money for my services. Now, I understand that there's a lot of things that are free on the internet, so I get that feeling like we were definitely there at some point. Um, but if it's good and if it's quality and if it's work, you deserve to be paid for your time. Crazy idea, >> right? >> Um, all right. Anyway, this article was about Amazon's rise in the ad business. And one of the things that we didn't mention earlier in the stock market conversation is that a lot of the stocks that are being disrupted by tech and Amazon specifically like the trade desk for example are getting smoked and are probably unless they somehow pull a rabbit out of their hat are permanently impaired. >> Okay. You mean like the college textbook places and >> all that [ __ ] Yep. There's so many of them. I I didn't we have a chart on on the companies that are impacted or by by AI that are getting their teeth kicked in. Come here. >> So, how is that a is that a long short ETF yet or should it be? It It shouldn't be. Look at this little guy. We have We have Temple today, right? Love you. >> That's a nice looking haircut he's got there, huh? >> So, I took him the other day and Robinson said, "Not too short." And they went very short in size, but gosh, is he adorable. All right. Anyway, um, sorry about that. Uh, my point is this. Amazon's ad business. So Mike Shields writes, "Backed by a massive audience, reams of consu consumer data, and strong technological chops, the company pulled in 56 billion in advertising revenue in 2024 and another $13.9 billion in queueing up this year." So Ben, the conversation earlier about what if it takes 10 to 15 years, nothing takes 10 to 15 years. Back to Mike, he said, "Considering that Comcast NBC Universal, which had a 100redyear head start, brought in just north of $2.6 6 billion in ad sales last year. It's fair to say that Amazon now runs the world's greatest side hustle. Dude, NBC NBC Universal brought in $2.6 billion of ads. Amazon did 13.9 billion in the first quarter of this year. These companies move so fast. Their moes are so wide. It's unbelievable. >> It's also funny that Amazon and now in the same business in a lot of ways in television. >> They're in every business. These companies are in every business. So again using chat GBT I >> love how you did you tell chat GB put an animal spirits thing in there >> I did I did so this part this part didn't work very well at first I put in the middle I'm like no lower left no below the axis I not over I'm like all right it's good enough >> the simple stuff it always has a hard time with which is funny >> so advertising revenue I had I compared Amazon with Meta and Google and obviously well this kind of surprised me I didn't realize how far ahead Google was of Meta did you Google's at like 260 Meta's at 160 60. >> It makes sense. They had such a long head start, you know. >> Yeah. But Amazon is coming up the rear. So then I had it show show me the growth. It said, "Do you want to see the growth since 2019?" So I said, "Sure." Amazon's up 400% since 2019 off a much larger base. Meta and Google are significantly behind. And then I said, "All right, that's not apples to apples." Because again, the base of these things. So I said, "Show me the year-over-year ad revenue growth." Um, and Amazon came out smoking, has since cooled off as as they grow. And now their their year-over-year growth rate is roughly in line with with Facebook and uh double that of Google. Anyway, my point is all this in two seconds. Pretty magical stuff. >> All right. And your other point is that to it's not going to this stuff is going to happen really fast. >> Really fast. >> All right. Let me take this thing out. >> Dude, this isn't like uh crypto where we're still waiting for a consumer use case like a killer app, >> you know, >> which just might never happen. Might or might not, but this is this is coming. >> Oh, you guys talked a bit about the board ape stuff, but I remember a couple years ago, Michael was buying some of those basketball card NFTs where he owned highlights. Whatever happened to with those? Can we please get a full P&L breakdown? Uh, yeah. I was having a lot of fun during the pandemic. I shockingly didn't lose money on this. Or if I >> was that called again? >> Top Shot. >> Top Shot. There you go. >> Or if I did lose money, I >> at one point you talked me into buying one of those. I bought it and I sold it like a month later. I was like, I I I feel gross. I can't do this. >> Yeah, it was a it was a hell of a fun. I think it probably lasted five weeks for me. I remember I bought I spent like $1,000 or maybe two on a Devon Booker one and I was like, "What am I doing?" Um, but I didn't lose any money. So, that's the P&L update. Um, or if I did, it was it was nominal. Uh, all right. Last week, uh, oh, last week we spoke about all the zombie unicorns from 2021, >> right? Ways raised hu Clara was one of them, right? They were at a $45 billion valuation. They IPOed at 16 maybe. Yeah. So, StubHub, those sons of [ __ ] um, they raised at a valuation of $16.5 billion in 2021. Now it's down to eight billion. >> How many people made StubHub extra fee on their IPO jokes on social media? >> Yeah. Um, >> Doug Bonapart definitely did. You know, he did. >> That's a That's Yeah, that's right up Doug's alley. Speaking of that, um, skipping ahead a little bit on the dock. So, uh, Mark Rubenstein, net interest, that's a Substack, one of the best, wrote about, uh, IPOs. We we we've been speaking a lot about these lately. He said three quarters. So, he's talking he was talking about the the zombie ones, the fintech ones specifically from 2021. That's his beat is is fintech. Three quarters are trading down from their IPO, including one that went to zero and eight that were returned to private markets at steep discounts. Um, Robin Hood is up 200% over 200%. A firm 86, New Bank 78, and Coinbase 37. The average return of the other 35s of the other 35 negative 30%. Interestingly though, he also says that's not to say these new issues didn't create a buzz at the time. All but nine popped on the first day of trading, gaining an average of 30%. While the few that declined lost only 7% on average, >> right? So, if you didn't get shares, you got hosed on these things. >> So, the fintech class of 2021 uh not great. And last last thing on this topic, we we mentioned um the cost of going public. I've never seen it broken out this way. So, this this was interesting to me. I'd like to I'm sure there's data out there, but he said talking about the cost of going public, Chime incurred $14.8 million of offering costs in addition to $43.5 million in underwriting fees on its $829 million of gross proceeds. So that is wild. So 153 it's 5%. 5% to go public. >> Okay, that sounds like a lot. Blockchain should fix this. >> I mean, I guess 5% sounds like a reasonable number, but if you think about the dollars, my gosh. >> Yeah, but to my point about last week that most IPOs are crap investments. That's true. And and one good one can probably dwarf all the bad ones, but there's a lot a lot of bad ones out there. >> We had a reader a few years ago um when I was talking about like the luck involved in in holding a lot of the biggest winners. This guy said, "Hey, dude. My this is like my strategy. I bought all the new issues or a lot of the new hot issues and I just held them all and the ones that went to zero went to zero, but the couple that went up 4,000% took care of everything else." And yeah, valid, good strategy. Credit to that guy. >> All right, let's talk about the housing market. I've been on this beat for a while. I said this when Trump got elected president to you and Josh. And this is from uh Market Watch. This longshot move could get the 30-year mortgage rate to 5% next year, says BFA Global. So, team of Bank of America strategists said that they think there's a probability that the Fed once again engages in mortgage back security QE, meaning they buy mortgage back bonds, which they did in the pandemic. That brought mortgage rates down way, way below. That got them to 3%. Um, and they're saying we could see 5% by 2026 midterms if Trump exerts more control over the Fed. And I think once someone gets in his ear about this, and honestly, to me, this makes sense because if if that's your really concern is getting housing activity going, this makes more sense to me than the Fed lowering rates. The Fed lowering rates is not going to automatically push mortgage rates down. >> I agree. So, I think that this actually and I've been pounding this to get the spread lower. I think this makes sense. I think that they probably should do this. People would be up in arms about free markets and this kind of stuff, but >> nobody cares about anything. >> Fair. But I I actually think that this is a better policy than the Fed just trying to lower rates and hoping that bond yields come down. >> Yeah. Yeah. the the housing market is obviously a massive story in and of itself and we're not going to cover all of it today, but one of the big stories is is the decline in building permits. Kevin Gordon showed a chart of the consecutive monthly declines and it's the highest since the great financial crisis. Now, there's obviously a lot lot lot more to the story, but the housing market has all sorts of impaired du. >> Yeah, the hurdle rate right now to build is is too high probably. So, somebody who's sharing this chart, um I think LAR just reported I I didn't dive into it, but LAR was subsidizing a lot of the buyers, right, of of new houses and they were they were helping ease the burden of high interest rates. They were doing that and I think Dr. Hordon wasn't and the spread between the two. I I apologize who I'm lifting this from. I can't remember where I saw this. >> Yeah, I think I saw this too. And it just saying that the the home builder that cut back is doing way better than the home builder that went all in and was building more >> and and that was subsidizing buyers, which is which is I guess not that surprising, but that was that was really good stuff, >> right? It should be the the government subsidizing the buyers, not the home builders. Come on. >> Yeah. Um the from Red Fin, the median US home sales price rose 2.2% year-over-year, the biggest increase in five months. And why isn't 2025 on here? Is this old? Oh. Oh, the green line is the green one. >> Yeah, my bad. >> Um, wild, huh? It's still at all time highs or right there. >> No, of course. Rates are high. Prices aren't coming down, right? >> Yeah, >> this makes sense still. >> Um, all right. We are getting long in the tooth as they say. Somebody had a really good email about um about uh what is this? >> Mortgages. mortgages are adjustable rate. >> God, the guy was like, "Dude, that's complete nonsense." And and Mike, why don't you uh give us an update on your your your housing move, which I will do next week. Um but because there is there's uh I got some some good stuff to share, but uh we're getting longer. I got >> I got a couple charts then I'm done. Okay. Well, actually, skip the charts. I want to go to this. Okay. >> So, this one I tweeted this and it got a lot of dang responses. >> Which one? >> This is from Y Finance. 61% of boomers never plan to sell their homes, while 76% say they're tired of being blamed for the housing market. This is a survey, obviously, so take it what's worth. Um, nine out of 10 boomers, 88% say they don't care if remaining in their homes prevents younger buyers from entering the housing market. >> Yeah. Why would they? >> Threequarters say they're tired of being blamed for the housing crisis. It is just funny because it's like, what are they supposed to do? Where are they supposed to go? >> Right. >> Duh. Yeah. It's not their fault. I think just the way that this survey was worded though is hilarious to me because they're trying for inner demographic warfare. >> Well, you know why? You know why I'm bored by with this inner demographic warfare stuff? It's cuz this is always the case. This is not unique now. >> I think it's I think it's going to get worse though. I think the housing stuff is going to make it even worse than ever. assets, retirement assets, wealth is a 21st century phenomenon largely and generational transfers like so >> big boomers are the richest generation ever and so it's going to be worse than ever I feel like in the next 10 years >> I agree with you I don't really want to partake in the in the uh >> I mean unless the boomers move into old person homes like where are they supposed to go >> yeah I'm not going to participate in the discourse it's just not that interesting to me and uh and I love my parents so there >> yes but young there's going to be a lot really angry young people that are mad at the wrong thing in the years ahead. >> Uh all right. Um oh here's another chart in a look at this chart. So we haven't really done many survey of the week type uh diet tribes recently. But one of the problems with surveys is that people don't answer them anymore to the degree that they used to. So chart has this amazing chart title. Believe it or not no one's at home. the response rate for the BLS current population survey of the unemployment rate from January 2019 to August 2025 and he shows the monthly increase or monthly decrease and people respond anyway. It's down to the right. Nobody's nobody's answering the phone. >> So it was 83% pre- pandemic. Now it's 69%. Uh I can't believe that it it was as high as over 80% in the previous period. Still seems high to me. >> Higher than I would have thought. But we know that the quality of the responses is deteriorating and he quantified it very nicely. >> I guess the hope is that we have so much other data to go on to like back this stuff up that it doesn't matter that much. But I don't know. Hulk Hogan. According to TMZ, uh the WWE legend's son, Nick, filed court documents Tuesday obtained by US Weekly, which says, man, how is US Weekly still a publication? Oh, US Weekly. My bad. Right. Is it US? >> US Weekly. Yeah. Okay. >> So, his son that was remember his he had a a reality show. >> Yeah. Um All right. So, he left behind $200,000 in cryptocurrency. Wonder what it was. Looks like a fartcoin guy to me. >> Litecoin. >> Um $799,000 in personal property and intellectual property >> as well like his bandanna collection. >> Uh don't don't bismerch the Hulk. As well as his right flags >> his right to publicity worth about $4 million. I'm not exactly sure what that means, but not a lot of money. >> So, this is saying that he was worth, I don't know, $5 million. >> Yeah. >> Wow. How is that possible? >> I guess he enjoyed his money and spent a lot of it. >> Okay. I would have guessed he'd be worth $50 million. >> All right. I would have said 20, I think. I don't know. >> We have we have to give a mayop to our European people. >> Okay. So many emailed in in the UK. It's true that last week we talked about how >> by I feel bad about I feel bad about my croissant truck earlier on. That was that that didn't didn't feel great coming out of my mouth. I apologize. Don't want to >> be >> uh in the UK it's true that equities only make up 10% of household wealth, but that excludes money purchases for DC pensions. Um I think the US data probably includes retirement accounts. These pension accounts uh these pensions account for 35% of total wealth in the UK. A lot of those assets are in target date style funds. So, it will vary, but you could probably assume that means at least a further 20% in equities. Um, side note, there are relentless bid effects here, too, because we have auto enrollment with minimums of 8% of earnings going into money purchase pensions. That links up with what we've spoken about in the past of foreign flows into US stocks. A lot of these target date funds are market cap weighted. So, anyway, like they have to put money into their pensions and that money is getting invested in equities. So, it's just not being counted as like direct purchases, but it it is there. Um, okay. I've talked in the past about people on flights, the people you see on flights. There's a new business traveler that I see every time I fly. Okay. >> This is a gentleman and usually he's in a group of three to five other gentlemen. Okay. >> They wear, >> of course, when they at the bar they have Bud Lights or they have Micholtas. Okay. The tall ones. Um, they wear jeans, they have boots on, they wear polo shirts. Many of them wear hats. And I'm pretty sure there's a 95% chance they are either owned by a private equity company or about to be whatever their business they're in is about to be purchased by a private equity company, right? HVAC or but you if you start looking at the airport, you will see these guys polo shirts, jeans that are a little too big for them, boots, and probably a hat with a really bent brim. And there's three to five of them together all the time. >> When you say boots, we what what type of boots are we talking about? Like >> worn in boots. Could be not cowboy boots, but you know, like workish boots. But so these guys are like they they are like people who have come up in physical work but now are in the management roles. >> Okay. >> And they that's a new line. I I saw four groups of these guys yesterday. I swear to God. >> Are these like land man's coming back >> cuz they were drinking Mick Ultra. So they had to be And guess what? I got one too because I I'm gonna be Billy Bob now. >> I've never had a MC Ultra. >> I don't drink anymore. I um I it's MC Ultra. Um, here's a question. Will you have hair by age 50? >> Definitely not. I am bald. I am bald for life. >> Scientists at UCLA found a drug called PP 405 that reactivates dormant hair follicle stem cells, potentially enabling new hair growth rather than just slowing loss. So, is it possible we'll solve obesity and hair loss in our lifetime? >> Okay. Obesity, it seems. Check. Hair loss. >> If you could just take a pill and your hair would grow back, you would definitely take it. >> No, I wouldn't. I would only take the hair loss. I would only get my hair back if I got divorced. Here's why. I mean, that's the the why there is obvious. Here's why. >> No, no. You'd have to get it if you got a convertible. Uh, >> no. Here. No. Uh, here's why I'm out on hair. I don't want to have this conversation with everybody that I see for the next 10 years. There's I see a lot of different people and there's a lot of people Oh, there he is. that I haven't seen in four years. I don't want to do that. I don't want to do that for the rest of my life. >> Okay. >> I don't care. 37 years of America's favorite drink, Charted. This is from Charter. Um, a lot of people drink Dr. Pepper, which surprised me. This is like the only one that's really straight up into the right. Actually, Fanta and Coke Zero. No, not Font. Coke Zero. Coke Zero. That's a That's a thing. All right. Anyway, >> Diet Pepsi. This thing I drink. What are you gonna do when Diet Pepsi goes away? Because this thing is on the decline. Nobody should drink Diet Pepsi except for you. >> I drink Coke Zero and Pepsi Zero now. >> Oh, Pepsi Zero. >> I think Coke Zero and Pepsi Zero better than Diet Coke or Diet Pepsi now. That's my new caffeine intake. >> Okay. Um All right. So, this is just perfect. We're we're moving and Robin's getting frustrated. I'm I'm probably on my computer. I'm like, "What?" So, Robin says, "I'm doing like 30 things at once." So, I very nicely said, "What can I do to help?" nothing. They're already done. >> That sounds about right. I have a little I have a little youth sports diet tribe. Um I feel so when we were growing up, I don't know that my parents ever said two words other than hello, nice game to my coaches like football and such, you know, >> right? >> Um now we have all these apps where parents can chat with the coaches and send them messages and it's cool because they can say, "Hey, practice time has changed or the game's going to start here instead of here." So it's it's helpful. Hey, my son I don't I can't get a ride for him. Can someone pick him up? So, it's cool, but it's also I think there's way too much communication because now the parents that want to complain about playing time. My son is playing football and we've gone from flag football where there's like five kids on the field and hey, everyone gets a carry every game to we're playing tackle, there's 11 guys on the field and guess what? There's five guys on the line. There's like a tight end, a couple not only two or three guys are going to get the ball every game and guess what? The parents don't like it. So the coach had to send out this thing saying like, "Hey, I tried to set expectations at the beginning of the year, but so I feel like the the access to coaching has to make it way worse for coaches, >> right? >> It's great for scheduling. It's got to be bad for PE the complaining parents >> and obviously as as our kids get older and many sets of parents have been through this before us, but we are now seeing that uh guess what? The kids that are good play more. Duh. And there are parents >> that live in this reality and understand how the world works >> and go with the flow. And >> this kid is obviously more talented than my kid. He deserves to get the ball more. >> Yeah. And then there are parents who live in an alternate reality uh who are just >> I don't know if not great people is too far because they're just, you know, it's their their children. They want to do what's best for them, but this is not what's best for them. Just get over it. Relax. Calm down. >> And they're Yeah. naive, I guess. >> Yeah. Okay, la last thing that I didn't consider is one of this is this is not a subtle detail as we talk about like us drinking back in the day and enjoying our party days. Um, somebody said they were born in 96, their wife was born in 01 and he's like listen uh there's a big gap between us in terms of like technology even though it's only 5 years. When I was in college and when we were in college, certainly there were no phones. Like people weren't recording every detail and that changes obviously everything. If you had to worry about what somebody was going to put on TikTok the next day, dude, my behavior, I would have gotten canceled to oblivion uh every time I drank. You know what I mean? >> I would have I would have been a different person instead of hearing from my five friends, hey, do you the thing you did last night? >> Like that was embarrassing. Like, oh, I forgot about that. To >> imagine it's like school can see it. Yes. It would changes everything. So that sucks. >> I I agree. That would totally change your behavior. It's like living in a reality show all the time. >> Yeah. So that was like a light bulb like Oh, yeah. Yeah. Of course, of course. I get it now. >> All right. So I we watched you mentioned Black Rabbit a few times. We watched it. Um listen, it's a it's a very cliche show. The the brother the brother who's the black sheep comes back and the um you know the restaurant stuff. I feel like every restaurant show or movie now has to have the one night where hey the times critic is coming in. It has to be perfect. >> But having said that so it is a little I only saw two episodes but I'm all in. I love the black sheep brother. >> It is a little cliche. I think Jason Baitman is underrated as an actor. He's good in everything he's in. >> No, he's not underrated. Everybody who doesn't like Who doesn't love Jason Baitman? >> But I feel like he's he seems like he's kind of just playing himself but he he's always believable in every single part he plays. >> He's fantastic. I don't think anybody would say otherwise. He's properly rated. Jude Law's American accent, but >> Oh, really? I I was going to say I thought it was very good. He's deeply British. >> I think he's he slips in some Anyway, um so they're trying to get money to pay off these people that they own. Um and they got to come up with 20 grand a week to pay these guys off, otherwise they're they're dead. Uh Jude Law doesn't have a 401k and IRA he can tap. Nothing >> for that age. I guess he works in the restaurant business. Anyway, I like it. It's it's it's a little cliche at points, but I still I'm I'm all in. Obviously, I'm watching it. >> Was that a Grand Rapids hedge? What was that? >> You like it? There was like a hesitation in your voice. You like it. It's cliche, but you're all in. No, you're all in. >> Yeah. So, here's the thing. It's a seven. Seven out of 10, not an eight out of 10. >> I feel like if you want to be prestige TV, you got to be eight out of 10. This is a seven out of 10, but it's still enjoyable. Uh, I started the paper, which is the offshoot of The Office that's on Peacock now. >> There's an offshoot of The Office, like a new one. It's like a new office. >> Okay. >> It's like so it's the same format as the office of like the mockumentary and Oscar from the office is on it playing himself. So it's like say hey we did a documentary on the office paper place now we're going to do a new one on a on a newspaper that's dying and um there's a there's a handful of actors and actresses that you've heard of and it has the same vibe as the office like the feel of it you know and uh it's not nearly as funny obviously it's it's and it's stealing some stuff but uh it got me to laugh a few times and it's good background show. >> Okay. Wow. >> So not terrible. Table Pounder. >> Finally, uh, Robert Redford passed away last week, I think. And for whatever reason, I'd never seen Butch Cassidy, the Sundance Kid. I've always heard it's one of the best westerns ever. Have you seen it? >> No. >> Um, fantastic. Yeah. I I'm usually a Okay. It was because it came out in 1969 and I'm usually like a gh. >> And I right when it started, I was like, "Oh, it's going to feel old." But those two guys, Paul Newman and Robert Redford, I think Newman was in his 40s, Redford was in his 30s. They were just oozing charisma. And it's like, oh my gosh, we do not have actors like this anymore. And I thought the only thing we've had as a modern comp would be Once Upon a Time in Hollywood with Brad Pitt and Leo who were older at the time. But it's I thought the first like hour of the movie was like unassailably good. I thought the end it kind of drifted away at the end and slowed a little bit, but it was really and it was written by William Goldman, so it had to be good. >> Okay. I will definitely watch it. >> It was good. and you got me listening to audiobooks somehow and I decided I have a I have 10 biographies that I've started to read picked up and started and stopped and started and stopped and I said, you know, I'm just going to listen to biographies and so I listened to Hamilton by Chernau and >> Wait, did you finish it? >> I'm 3/4 of the way through. >> How long would it have taken you to read that book? >> Oh, so long. And I got it on 1.75 speed. And the thing is that you said that you stopped listening to some podcasts. I have sports podcasts and pop culture podcast and then market podcast and I'm realizing like wait do I want to listen to this dumb podcast or I'm going to listen to the audiobook and I'm finding myself choosing the audiobook more and more. I have listened to I haven't listened to a podcast uh in a month. >> I'm gonna go on a hike later in the mountains here and I'm gonna bring my AirPods and listen to the thing the thing I picked up from the Hamilton the book and I'm not the obviously he had his run of popularity and I'm way late to this but just how young those guys were and how impressive they were and they would be shaking their heads and rolling over in the graves at the politicians from both parties these days cuz they were they were obviously they had their flaws but they were such high character intelligent individuals. integrity. They had it. >> Yes. They would look at the politicians of today and go, I can't believe this is what we have to choose from. These two poo poo platters. This So anyway, that's what I got. >> You're welcome. Um I too am listening to a biography. This might shock you. I'm listening to the power broker and it's 66 hours on one time speed. So I don't know how long it's going to take me, but this will probably take me three weeks. >> That's the Long Island guy. What's his name? >> So Robert Moses built New York City and the surrounding area. Long Island as well. >> Everything. Built it all. Um okay. Uh uh oh, you're not watching Task on on Max? >> Of course I am. >> Okay, we didn't mention that. I I I uh I think The Move has really buried me. I that and and Future Proof getting behind on work. My calendar is is my head is spinning, so I I've only watched one episode, but I I'm excited to watch more. Um >> it's good. >> All right, last thing. I popped on Field of Dreams the other night. I haven't watched that movie in full in 20 years. Like, why would I I know that movie like the back of my hand. I saw when I was four in the theater, not to break. Um, and the scene that I popped in on was Kevin Cosner with a fake gun in his shirt. And of course, you know exactly what I'm talking about. The chemistry between him and James L. Jones was ridiculous. So, I I only caught 10 minutes of it. What a dumb movie. Only in the sense that the plot is so insane. The fact >> it really shouldn't work. the fact that they were able to turn that into an alltime alltime alltime great alltime classic. So the scene with uh Go the Distance when they're at Fenway, it's so dumb. It is so dumb and it never occurred to me because I saw it when I was, you know, a baby. Um but god, what a movie. >> It's a movie that really shouldn't. I watched it with my daughter last year. It shouldn't work, but it still does. >> All right, I got to show it to my kids. I'm I'm going to cry at the end, obviously. >> I I did I I got a little teeyed at the end. I'm not going to lie. All right, so an hour and 16 minutes. This might be a new uh new record for us. I didn't even know this would be a long podcast. So with that, I want to thank uh Duncan and John and Nicole Daniel and Travis. Uh the team is going above and beyond. We are doing media. >> We are doing 19 podcasts a week. Graham and Rob of course too. Um, so in addition to that, we are full steam ahead on Talking Wealth, the show that we're doing for advisers. It is now on its own audio feed, Spotify, etc. called Talking Wealth. We understand that advisers probably don't want to sit in front of their computer watching an interview. So, if you wanted to tune into that content, but you don't have time to to watch it, you can now listen to it uh instead of audiobooks. So, check us out. We're out talking wealth and we're doing uh one or two conversations every week last week >> in around the the industry. That was very good. >> Very good. So, all right. Thank you everybody for tuning in. Happy New Year to my Jewish brethren and sisterin. Um animal spirits at the compoundnews.com. We'll see you next time. [Music]
A Mania Is Brewing | Animal Spirits 431
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This message is brought to you by Nuvine. What does it mean to invest like the future is watching? As one of the largest global investment leaders managing $1.3 trillion in public and private assets, New is uniquely positioned to take on tomorrow today. Combining over 125 years of deep expertise across income with innovative alternative solutions, Naveen adapts to the needs of investors as they change. Offering reliability, access, and foresight to its clients, communities in the global economy, all in the pursuit of lasting performance. Naveen. Invest like the future is watching. Visit noven.com/future to learn more. Investing involves risk. Principal loss is possible. >> Welcome to Animal Spirits with Michael and Ben. It is Tuesday morning, 8:00 a.m. Eastern, 6:00 a.m. >> Mountain time. Canadian mountain time. >> Mountain time. I think I'm in B with two Fs. Uh, so I'm not like a, you know, I'm not a ski person. >> Hold Hold on. That town, it's it's it's there's an N before the F, right? It's N, not Yes. With two Fs. I I've I'm not like a ski person so I don't know what to compare it to but I guess Aspen Jackson Hole something. It's a beautiful town with ski shalets and hiking and mountains and gorgeous. >> What are you doing? >> I am here to talk to a group of wonderful Canadian financial adviserss which we had a ton of at future proof. >> Yeah, we did. What are you going to be talking about? >> Uh I'm just going to talk about the future of financial advice. And it's funny, the Canadian adviserss, I feel like they're being a little modest, but they say, "Listen, we're anywhere from three to five to seven years behind the US when it comes to our advisor space and we want to kind of learn from you guys what the best practices are." Um, so that's what we're talking about in the mountains. It's a beautiful spot for it. So, I'm excited. Uh we are we're prepping for speaking of future proof the Miami one which uh a lot easier to get to for East Coast people. So I expect a huge turnout for for the second annual event there. And uh we're talking about potential musical acts. And am I excited? >> All right, we're just going to have to pay up for them, I guess, like we said last week. All right, so this feels like the I don't know. I It's never it it's hard it's hard to figure because you said last week you say everyone and you mean like yourself or but it just feels like we've turned a corner where I don't know how you could look at the behavior of companies and not think this is some sort of bubble that that's kind of my feeling that and but it's not this is not investor behavior bubble. I feel like this is bubble activity brought on by the tech CEOs. I feel like they're the ones who are pulling us, kicking and screaming into this whether we want it or not. >> Yeah, this week was an inflection point with Oracle and the debt that they're going to take on fueling this to like the next level, which we're going to get into in a second. But Ben, you mentioned like it's more of a uh company-led bubble, not an investor-led bubble. This is not a corner of the market that you concern yourself with, but there are a bunch of unprofitable in many cases even pre-revenue companies that are going literally vertical. Aqua, for example, it's a nuclear company or potential nuclear company. They have no revenue. Uh they're not even like there's not even revenue on the horizon. I was listening to the call the other day which a lot of it was signed so I I sort of skimmed a lot of it but the stock is up like I don't know 1500% over the past year something crazy and a lot of like the quantum computing stocks so that that corner of the unprofitable and in many cases pre-revenue slice of the market and Aqua is now a $20 billion market cap there is that is definitely bubble behavior but it hasn't spread to the $493 for example so it's it's weird because it's like a retail bubble in in the small corner of the market and then the hyperscaler lead bubble with the middle companies just like not sucking wind but sort of you know neither here nor there. Nobody cares. >> The weird thing we talked our in our ad read about crane shares has the robotics ETF. That stuff hasn't even really seemed to happen yet. I don't know how far off that stuff is from being a real thing, but it feels like the AI bubble behavior is just going to hand the baton over to the robotics bubble at some point. So me saying this feels like bubble activity is not me trying to say like all right that's it. >> Yeah. No, I know you're not saying that the bubble is is near its end. And of course >> nobody knows when the ride's going to end. I guess enjoy it while it lasts and maybe it lasts for another decade. Like literally nobody knows. But I would say that the news that we got this week or last week it started with with Oracle and and uh Open AAI that partnership. Um and there's a big wrinkle in there that we'll get to in a second. I would say that this is like the seventh inning of a baseball game. Now, the inning might go 20 the game might go 22 innings, but this was a definite like inflection point in the story. So, um, put some meat on the bones as they say. >> Wait, hang on. So, so my my feeling is that these tech CEOs, I don't know if they all get together and talk about this stuff, but it feels like mutually assured destruction where listen, we're all either none of us are going to do this or all of us are going to do it. If we're all going to do it, we're you're going to invest in you. I'm going to invest in you, too, and you're going to invest in me and we're and he's going to invest in you and she's going to invest. It's like everyone has to invest in each other. And and it's like it's kind of like a friend pact where you all took a pact that this summer we're going to do something and if you don't do it, sorry. You know, you have to jump off the bridge with us >> like American Pie but for tech dorks, >> right? They all took a pact it feels like. And it's like I'll invest in you but you have to invest in me too. and that it feels like it's just we're moving deck chairs around, but it just happens to be hundreds and hundreds of billions of dollars. >> By the way, my brother uh I have a brother that was born in 1999, the same year that American Pie came out. I doubt he ever saw it. If you're of that age, and my brother is Oh my god, 26. Watch American Pie. Damn it. >> How about this? That was >> That was the first ever millennial movie. >> Yeah, I believe that. Was that No, wait. It wasn't 99. Was it 99? It was 99 because I was a high school senior at the time. So, it like lined up perfectly for me. >> Yeah. Okay. >> My take is that was the first ever millennial movie. >> Yeah, I think that's right. Um, all right. So, Mark Zuckerberg said on uh a podcast last Thursday, if we end up misspending a couple of hundred billion dollars, uh, that was their market cap not too long ago. I think that is going to be very unfortunate obviously but what what I'd say is I actually think the risk is higher on the other side. Um he said the risk is probably Yeah. not being aggressive though. Yep. So uh Adam Parker has a chart showing total capex uh of the top 10 spenders compared to their dollars and it's yeah it's it's up and to the right and here. All right. So to me this is the main point in framing where we're at today. So Ben Thompson has a blog called Strateetery. He's one of the foremost authorities on on tech and innovation. >> I always think that his his substack sounds like or his newsletter sounds like Will Ferrell as George W. Bush. >> Oh, because you listen sometimes. >> Yeah. >> Uh oh. Um All right. So he quotes this guy Doug Olaflin. There is no way for Oracle to pay for this with cash flow. They must raise equity or debt to fund their ambitions. Until now, the AI infrastructure boom has been almost entirely self-funded by the cash flows of a select few hyperscalers. Oracle has broken the pattern. It is willing to leverage up to hundreds of billions to seize a share. The stable oligopoly is cracking. Uh the implications are profound. Amazon, Microsoft, and Google can no longer treat AI infrastructure as a discretionary investment. They must defend their turf. What have been a disciplined cash flow funded race may now turn into a debtfueled arm race. That's a vibe shift if I've ever seen one. Welcome to the next and newest phase of the capital cycle. I believe the Oracle quarter achieves something more elusive than just revenue. I believe Oracle has just sparked the elusive animal spirit to life. Uh I believe that for me Oracle is the quarter that we will remember in history. Wow. Um was there one other thing in here that I wanted to pull out? uh compare the spending of the big three with that of Oracle. Oracle is going to go negative free cash flow to win and it's likely that incumbents will respond. I believe it's time for technology incumbents to start spending a lot more and most have already indicated they will. So I read this over the weekend and I slacked you and Josh buy everything. This bubble is about to go nuts. S&P 500 10,000 then 5,000 or something like that maybe. >> Boy, it sure it sure feels like that. And as people who try to be level-headed, it it feels weird for us to say this kind of thing, but if you look at any any financial history book, that's what it would tell you. And the great point in that piece is that you're right. all this spending before was uh just from their cash flows they were making from their businesses which was which was so huge it didn't really matter that they could invest in this stuff. They haven't even really pushed their foot on the gas pedal. like if they want to, they could really ramp this up and say like, "All right, we're bringing everyone into a new era regardless of how you you feel about it." And and obviously the hard part to figure out here is like how far ahead do expectations get and when does the market want to return on this capital and blah blah blah. >> It's all we're all guessing, but man, this is this is a hell of a lot of fun, Ben. Um, so >> yeah, because eventually it's going to it's like you said it's it's some fringe companies now, but this it's going to eventually bring other companies into the fold. This is not just going to be the top 10 stocks in the mag seven forever. Other and it's not just going to be tech stocks. It's going to be other companies using these AI tools where you're going to have some companies say, you know what, we're laying off 20% of our workforce because we're going to see productivity gains from AI. There's going to be a company that's going to do that and it's going to shoot up 20%. And it may not work, but that's kind of stuff that's the stuff I'm is like the second and third order effects that's going to happen at some point, you know? Um there's countless examples over the last 10 years where we could look back to and pinpoint moments of us literally laughing at how big the numbers were when Apple got to a trillion dollars, right? Like that was the music was going to stop. It just magically was just going to stop at a trillion. Um, when you think about uh the spending of the hyperscalers, 300 billion, 500 billion, we're going to look back, we could look back in three years and say that was quaint. Remember when they were spending $400 billion and there was it was just funded by free cash flow. Um, and yeah, like when and where and how and all that sort of stuff like nobody knows. So, we're just going to document it in real time and do the best we can. Um, there is a there's a new high in the weight of of market cap in the S&P 500 for Nvidia and Apple now up to 14%. Which is that ain't nothing, Ben. Oh, you know what? It's probably time for me to update the pie chart, isn't it? >> It's getting there. The weird thing is is it feels like Apple is not participating in this stuff. >> Not in the AI piece, >> right? >> Oh, I did I did I did just, you know, I'm so oblivious. I just ordered the new phone. Um, there's a new model. Do do you know about the new that there's a new model? >> Yeah, I see the headlines and such. >> Okay. Well, I only just saw them this week. >> Gives you like 3% more battery probably. >> I don't know. I ordered one last week only because my iPhone was like breaking cuz I'm an idiot. I didn't put a case on mine and I just had cracks all over the place. Uh but the iPhone 17 is in high demand. Like Josh told me he tried to order one yesterday and it's not it's backdated to like October 17th or whatever. But yes, they are buying the in the AI stuff. Anyway, >> hang on. I got one more thing from Ben Thompson. He he interviewed Burn Harour a while ago. remember he had that new book on bubbles and he and he said this is this is Hobart what bubbles do is they create one of those clusters in time rather than space where this is a time where everyone is doing this thing and so this is the time to do it if you know that people are building other elements they're building parts of the infrastructure that your thing needs to be built on then it's actually less risky to build so Amazon was a less risky business because AOL was massmailing their discs and telling everyone get on the internet then AOL became less risky business because Yahoo is giving you stuff to find in the internet blah blah blah eBay and that's what led to the whole internet stuff. So that's the reason all these companies are doing this because listen, if they're all doing it and we're doing it, it's like we're going to make this a thing and and AI is going to I guess the one thing I would try to say is that like what if just they Zuckerberg is right and they sp they overspend by a few hundred billion dollars and AI isn't this thing that transforms our lives now. It maybe it just slowly but surely becomes a bigger piece over time. Um >> I reject that part. I think I I think the the coming transformation is inevitable. And >> no, I'm saying what if it doesn't happen in the next 5 years? What if it's more of like a slow thing where it's like in the next 10 to 15 years life changes, but it's it it doesn't it's not like there's this point in time where it's like, oh my gosh, life is so different. It it happens. It's more of a slow burn. >> I think it's going to be more overnight. I think that there's we're going to wake up one day and say like, wait, I don't think it's going to take 10 to 15 years. I I think I think that's a possibility that that >> Listen, I think I think it's easy to point out a million different risks. >> No, in a in a bubble, it's easy to think like life life is going to change forever overnight. That's how that's what bubbles make you do. That's that's why I'm trying to temper it by saying like cuz everything we got from the dot bubble happened. It just didn't happen right away. Remember, everything that they wanted to happen and more happened, but we had to go through the dot bubble and then YouTube came along >> and then all the other stuff and it took some time. >> Um, thanks. Think things happen so much faster today. >> That but that's why this is a really fun time to think through though. That's why all of these companies >> all of these companies that get to a hundred million and a billion dollars in revenue, it happens so much faster. Just it just does like that chart a million times. >> I and I keep seeing these people saying, "Listen, >> it's not going to take 15 years." >> I I keep seeing people uh in the tech world say, "Listen, there's going to be a company with one person that's going to be like a billion dollar market cap." >> Yeah, I believe >> everything they do is is AI based and it's one person running the company. Maybe. >> Uh, all right. Uh, MAG 7 from Biano, new new high in the S&P 500 that they're 35%. Where does this stop? Don't know. We'll see. Um, all right. Uh, another derivative of this story is is data center energy consumption. Zakari tweeted tweeted this chart from uh Bank of America. US data center energy consumption and a uh as a percent of total US power demand uh 4% and 23 4.2 2 4.5 4.9 5.5. >> So, uh, >> at what point do we get the AI backlash of people saying, "Wait, why is my electricity bill so much higher?" >> Yeah, >> someone's going to be on that corner. That's going to happen. >> I saw a lot of people tweet about that this weekend. People are people are sticking their claim there. It is funny though that um technology is usually deflationary, but as of now, you could make the case that this AI bubble has been inflationary because it's it's it's led to higher mortgage rates and it's led to higher electricity costs. How about that? >> How has it led to higher mortgage rates? >> If these companies weren't spending I I blame Mark Mark Zuckerberg for higher mortgage rates. If they weren't spending all this money, there's no way rates would have kept been so high. >> Oh, because the economy wouldn't be as strong. Yeah, I buy that. >> Yeah. Um, okay. Valuations, who cares? You want to talk about this? >> That is true. Uh, it's just it it's showing that like the the rest of the market, to your point, has not come along at all. So, the equal weight's trading at 17 times. I don't know how you could look at that and say this is a a crazy bubble. Uh, >> dude, valuations don't matter until they until they do. I know. Very profound. >> Yeah, they Yeah, they you're right. But I guess throw them out the window. But it's it's not my whole point is that valuations can get a lot crazier if this thing is going to go. >> They're not crazy though. That's the thing. We we're talking about the story. We have like in Nvidia's what's Nvidia forward earnings. It's under 30 I think. >> Yeah. That that's if you put all the >> those are rookie numbers. What is >> max together? They probably I think they trade at Yeah. Let's call it an average of 28 or 30 times earnings. >> I think maximum is a little bit over. It's not crazy. >> It's not insane. That's the point. It could We still have room to get insane. That's the That's the point. remember um remember April? >> Like I feel like >> feels a couple years ago. >> Life is moving so fast we just like whitewashed the fact that we had like a massive tariff tantrum and a really quick bare market. Um so we have this chart on exhibit A for advice.com for advisers. What if you panic sold and missed April 9th? Now we mentioned this when we first shared this chart. Obviously, I would maybe say that there's one person on the planet Earth that sold on April 8th, uh, saw April 9th up 10% and said, "Oh [ __ ] I'm going to buy on April 11th." Right? Like, nobody did that. >> There's got to be a Reddit post out there that someone of someone who did that, but you're right. >> That is psychotic behavior. I can't imagine the type of maniac that would have panicked and then panicked a day later. Just doesn't happen. Um because obviously the feeling of like this is fake, I missed it. All right, whatever. Anyway, the point is this. If you did that and were psychotic enough to go all back in the next day, the S&P is up 13.5% year to date. Whoa, it is. Uh well, if you miss that one day, you're up 3.7%. Buy, >> hold, or trade like your life depends on it. By the way, did you listen to the Tom Sashnoff TAFF? I did not yet. >> Okay. >> I was another busy weekend to be with child sports. >> What a vibe on that guy. Just great energy, great feedback from the audience. He was uh he was a lot of fun. >> I mean, based on the hat alone, yes, the guy has a vibe in the hair, right? >> Yeah. Um all right, somebody emailed us. I'd be interested in your take on this info and advice on how one >> Wait, did he did he make you want to become a trader again? >> Um no. I I don't have time for that. And I I I've done that. Like that's a whole that's a for me that's a that's a slippery slope, my friend. You know, that's true. You were telling me before that you're not even going to sports gamble anymore this year. Maybe you're like turning over a new leaf. >> Well, I lost. All right. >> Wait, we shouldn't say that because you and I are going to Vegas in like six weeks. >> Yeah. So, I I I said to myself I was going to deposit money for the season into my FanDuel account and when it's gone, it's gone. That's what I was That's what my plan was. And it just so happened that um life got busy for me. So, I bet I lost 500 bucks on the Eagles. Who did they play opening night? Eagles Cowboys, right? Was it Eagles Cowboys? So, I teased it to Eagles minus 2 and a half. I think they won by four. And I teased the overunder down to 44 and a half. Now, I was telling Tom Self this. I don't do like plus 400 bets. All right. So, the Eagles were favored by four. I bought it down to 2 and 1/2. The overunder was like 48. I bought it down to 44 and a half and now it's basically even money. So they scored 41 points in the first half. Um there was that lightning delay that lasted for like an hour. I fell asleep. I woke up. The Eagles won by four points. So my my spread was good. In the entire second half, Ben, they kicked one field goal. They scored 41 points in the first half. They scored a field goal in the second half. So my overunder that was 44 1/2 I missed it by half a point cuz I only scored a field goal in the second half. So I lost 500 bucks on that. And then week two, I don't remember where I was, but I just I haven't gambled in the last two weeks. And I said to you before we started recording, the Giants are a piece of [ __ ] organization. I'm only wearing this hat because it's closest hat available. Um I might take the season off. I might just check out. I am so disgusted with this team and I'm numb and I'm mad and I'm bitter. I didn't watch week I I didn't watch a Chiefs game. and I saw it for like 3 seconds. I have no interest. I have no interest. I'm just >> This is a good time for you to to be moving. I would love you know how they've done those studies in the past like Teran Soden did this study where he got a hold of brokerage information and showed how bad people are at actually trading stocks like the and the results are worse than you could ever imagine. I would love it if someone could dig into the FanDuel DraftKings data cuz I got to imagine that >> treasure trove. >> There are so many awful awful betters out there. I the the loss rate has to be probably even bigger than most people think. Oh my god. Uh, so, um, anyway, so I might take the season off. I might just check out. So, because of my audiobook addiction, I'm no longer listening I swapped one addiction for the other. I'm not listening to the to Ringer podcast anymore. So, I like loosely am following the NFL, but not really. Um, but I wonder for week by week seven, I'm like, "Yeah, I don't know what's happening." Which is a a hell of an a bad face for me because I've been obsessed with the NFL my entire life. You're transforming before our eyes, you know, listening to audio books. No more gambling on sports. >> I am. I am. But it's it's really because the Giants are trash. Trash, trash, trash. Um, and I'm going on on on Sunday, >> which is I can't wait to boo. Only go to boo. Uh, speaking of bad betting, and sorry for the tangent. I know a lot of people could not give one less of a [ __ ] about >> Yeah, let's talk about your fantasy team after this. >> Yeah. No, I know it's very riveting. Um, uh, Black Rabbit, the scene where he where Jason Baitman is is gambling. Like people gamble like that, maniacs. >> Yes. Yes. Absolute. Yes. Those people have issues. You want to talk about this passive stuff or not? >> Yeah. So So real quick, I I know we've beaten this this horse to death, but I thought this is just worth mentioning. Um, all right. Uh, on one hand, passive investing is low cost, but holds broader long-term systemic concentration risk per slack. That's tors and slack. But on the other side, you have historically underperforming active management with higher fees. Would the more expensive active manager potentially avoid the systemic concentration risk and earn their fees plus some in avoiding the full impact of a significant systemic market correction or would they be subject to the same challenges and the investor would just pay more for the same outcomes. Um so he he included a chart from Torsson Slack that shows almost 55% of ETFs and mutual funds are passive. Now, >> right up from 25% in 2012. Um, if there is a marketwide meltdown that follows the path of the dotcom bubble where tech is the epicenter and the hyperscalers burst because they're overspending and investors preference change and all the promises didn't come to fruition, then yes, I would expect a lot of active managers who are underweight to significantly outperform. >> How many of active managers do you think are still underweight though? I feel like so many of them have been pulled into this. >> Okay. Well, I I do think a lot are still underweight, Ben, given how much how many of them are still underperforming, >> which sort of true, >> which which is in stark contrast which one I'm about to say, which is that active managers set the waitings. So, I don't know exactly how to square that circle, but yes, I would expect the underperformance to catch up dramatically if there were a techled meltdown. Would you agree? >> Here's here's the thing though. You don't need active managers to do that for you. you can invest in value stocks, high quality stocks, dividend stocks, small caps, all that stuff is probably going to do international stocks is not going to get hit nearly as bad if this hyperscaler stuff blows up. So, you don't need active managers to diversify for you. You can do it yourself easily these days. >> We are I think Jonathan Clemens would smile to hear us say that. Jonathan Clemens, uh, rest in peace, passed away earlier this week. He was a longtime columnist for the Wall Street Journal. Um I think he I think he gave the baton to Jason Zwig, right? I think Jason took over for him. >> Yeah. So yeah, I read all the pieces. Jason wrote a nice piece about him. He wrote his own piece kind of going through his life story. Um he was a nice guy 62 years old. >> I the thing I really always respected about him was that he was a stick to your guns kind of guy. He never like wavered and said like, "Well, what about this and what about that and let's look at all sides of this thing." And he was he had his beliefs and he stuck to them and he almost like for his readers, he was like, "No, you're you're coming along with me and you're doing this too." And uh I got a lot of really nice emails from him and traded and talked to him occasionally uh even over the last year as I was going through a period of grief. I traded emails with him about what he was dealing with and uh just the the nicest guy and he handled it with such the whole period with such grace. It was really like really inspiring to see. >> Yeah. So, rest in peace to Jonathan and uh obviously condolences to his family. He I only had the pleasure of meeting him once, but he was definitely a wonderful person and helped uh countless readers along their financial journey. Okay. Um, all right. Let's let's uh transition to investor behavior on the opposite side of of what Jonathan preached. Um, all right. Retail imbalance. This is from uh daily chart. All right. Here's a via via via for you, Ben. Um, Goldman Sachs via zero hedge via daily chart book for me. Largest weekly inflows since December of last year. There is definitely there's definitely animal spirits in in pockets of the retail world. And it's so weird. We keep talking about this this dynamic and the dichotomy in the markets of like um the American Association of Individual Investors and the Schwab Sax report that are sort of like showing you know signs of euphoria and then um this corner of the market retail traders like going absolutely berserk. >> Well, how about this from the Wall Street Journal? $7.7 trillion in money markets. How do you square that? >> Yeah. Well, I think I think >> if you look at the the assets in money market funds, that chart that to me looks like, oh my gosh, this is a crazy like bubble-like behavior or whatever. Maybe we're throwing that term around too much, but it's it's there's a lot of different things that you have to your brain like the cognitive dissonance is really >> you have to hold several ideas at the same time that are in that are in in conflict with one another. >> Gold at all time highs, money market funds at alltime highs, but also the crazy AI bubble stuff. How do you how do you square all that? >> And the slowing economy. We haven't spoken about that yet. And and rate cuts. Um >> stock market doesn't doesn't care about the economy. >> True, true. Um yeah, it's it's a it's an interesting time to be a market observer and participant. So Nola says, "The NASDAQ composite may have just made a new high, but it is nowhere close to our simple rule of thumb to identify unsustainably high prices. A double is a bubble." And it's not been a double. But it's so funny. You see, you see like there's so many different charts that people are like complacency, euphoria, mania. Why aren't people uh chasing? >> Is he saying it has to like double over the course of a year for it to be sort of bubble-ike or what what's the >> Yeah, he he he's showing that this is this is nothing compared to the prior mans, >> right? >> So, even though those those unprofitable or in cases pre-revenue names that we mentioned earlier are going bananas, a lot of names have gone sideways. >> The 2022 thing is the hard part to square with this. the fact that a lot of these companies fell 40 50 60 70%. That's the weird thing here, but that was kind of before the that was before Chat GPT really. >> Yeah, >> Chad GBT stopped that from so it's >> so the the S&P is going to 10,000. Uh I I can't I won't dare to put a a year on that. >> Um let's just say it happens in our lifetime, but I think it's I think this bull market takes it there. Needless to say, there will be corrections and bare markets. It's not going to be a straight line. Um, >> so wait, how much that that so from current levels which is I don't know 6700 to 10,000. So you're talking about >> a 50% move higher or so. >> Not even. >> I'm doing the math here. >> Isn't that like 35 to 40% higher? >> Math. Hashtagmath. I What? Yeah. Wait. 35 to 40. My bad. All right. Do I dare do this on the internet? No. No. It's a percentage higher. It's a percentage higher. And guess what? You tell me what it is. I don't care. I'm not doing this. >> But the funny when you say S&P 10,000, it seems like, oh my gosh. But then when you do the percentage, it's like >> uh all right, it's 50%. >> Yeah, that's what I said. >> You're right. That's like two more. By the way, I'm helping my my daughter is in sixth grade and she has math homework and it's stuff that I haven't thought about in forever and she'll send me a pro like it's kind of funny how awesome technology is. I was on a plane last night from Detroit, Michigan to Calgary. And in the in the flight, I'm getting text messages from my daughter about her homework. I help her with her math homework. And um I I will do the problem and I'll say, "Hey, I'll help her like think about these three things, but then I will always like take the problem and upload it in Jad GBT just to check my work." Um and it's kind of amazing. I'm how many thousands feet in the air asking AI to help me with my daughter's homework who is 500 miles away from me or something. and I'm relaying that back to her. >> I wonder if as I use AI more and more, specifically the LLM models, the large language model models, that's like ATM machine. >> Yeah. >> Um I feel like I'm like doing more than ever and I'm just filling the time and now I instead of like I'm just cramming more work into the work. >> We're not going to become we're going to become more efficient. We're just the same as on hours. >> There's a name for this productivity. >> We're doing more with we're getting more I'm getting more work done in the same amount of hours. I'm doing my output is at an all-time high and it's not even close. >> Could you really see Americans going from 50 hour work week to 30 because AI makes us more productive? No. >> No, we're not Europeans. All due respect. Love the croissants. >> But also the cool thing is though like the the it doesn't just give you the answer, it shows you how to do it. Like for my daughter, like I'll I'll tell her like look at this. And so because she and she herself, she doesn't just want the answer. She wants to know how to do it. Which I really like because she's like, "No, no, no. Don't just tell me, show me." And so she has to see if we ever put it. And we do chat GBT at the end. Like I tell her, "We got to work through it first, then we're going to put it into the AI." And she has to see the work that it goes through. But it it does show you. It'll say, "Take this and start with this and then then narrow down to this." And it is pretty uh pretty amazing. They're just going to grow up with that. All right, back to the money market thing real quick. You've talked forever about how that money is sticky. And I think it could be because I think it's probably mostly baby boomer money. So they interviewed people in the Wall Street Journal. Tom Ward, a 64-year-old executive recruiter in Michigan said, "Re's going down is not going to chase me into stocks. I really don't have a problem sitting on the sidelines." And he has 40% of his SP goes to 9,000. Let's check back with Tom then. >> Um, so this is interesting. This is from Brian Jacobs, friend of the show from Aptist. Anytime you have a society with more wealth, you would expect them to hold more cash. people hold cash for the cushion, not because it's yielding yielding higher than assets. And it could just be that like the low the low we saw in money markets in the 2010s was just the fact that rates were so low and unless we somehow get back there that this money even if it gets down to 3% or 2%. Probably is kind of sticking. I think a lot of people have decided I don't I saw what happened to bonds in 2022. I don't want that. I'm just going to hold cash in T T bills, CDs, whatever that is. I think there's money markets. I think there's a lot of that to this. >> Well, Brian's exactly right. And anytime you see this chart, you have to adjust. You have to adjust for percentage of S&P market cap or something. >> Yes. For what? There has to be a denominator. You're right. >> And to your point, it's like, all right, I want cash. I have all this money in the stock market. I want cash. And when you do that, the 7 trillion or the whatever it is, it look all of a sudden it looks a little bit less. But that that's why it's also hilarious to me that people say, "Just wait when the stock market rolls over cuz the top 10% are spending 50% of the economy. Just watch out. The economy is toast." Guess what? Guess who's going to be buying stocks when they fall? >> The rich people. >> But the top 10% they still they're going to be the ones who are buying. >> They're not getting nuked. Speaking of this guy, there were two there he is in the first couple episodes of of Black Rabbit and it's the virus is spreading. >> You sent it to me. I I totally missed it. Also, >> by the way, this is not this is I'm just uh it people say this all the time. I'm just pointing it out. It is common vernacular. >> Oh, you're right. Trust me, every time the dads on the soccer sideline see each other, you get one of those. Hey, there's that guy. Hey, it's Of course. >> Yeah, it's great. Yeah, see it all the time. >> All right. Um, I follow Rob Wilson on Substack. Uh, and he posts about retailers and the retailing industry. We got a report last week. Non-store retailers, which are that's e-commerce. Huge huge growth. 2%. Is that what is that month over month? Can't be. Right. Can't. >> I think I accounted for 1.5% of this gain. I I I I don't couldn't tell you the last time I bought something at a store. It's been years. >> So I uh I opened up Chat GBT and I said, "Make me a chart of non-store retailers." This is a percent of total retail. Look at this chart. Two seconds. And we saw that crazy. So obviously it was trending higher. Duh. And then you saw the spike in 2020. You saw a cool down. Now it's coming back. I mean that's >> it's amazing that it's right back on trend. >> That's pretty wild, right? So, because remember everyone said, "Okay, we're pulling all this stuff forward from the pandemic." We did, but then it went right back to >> We should have had to draw a trend line. Nature finds a way. >> Look, it's a it's a it's literally a perfect trend line. >> So, I was going out to dinner. I went to dinner last Wednesday and it was like a niceish restaurant and I was wearing a future proof, one of the green future proof t-shirts and I said, "Ah, [ __ ] I should probably should probably change buy a shirt." So, I was walking to uh dinner and I was going to stop in Macy's and buy something with a collar. And on the way over, >> dinner at a mall. >> Can't call it a nice place to be dinner at the mall. Sorry. >> No, no, no, no, no. I was going to stop on my walk. I was going to run into a Macy's. >> Oh, okay. All right. >> On in Harold Square. >> Okay. So, you're Okay. I got I was making sure you're not walking through a mall dinner. Although uh there are uh what's the mall in Columbus Circle? There's nice restaurants there. Anyway, >> between an indoor and an outdoor mall, though, too. So, >> there's no outdoor malls. That's a thing. It's an outdoor mall. >> Outdoor mall. It's in nice places. >> Okay. Oh, that is true. You're right. You're right. Uh the Grove, I believe. >> Yeah. Okay. >> Really nice outdoor mall in Naples, Florida we saw last year. So, I passed a Banana Republic and I feel like you were a huge Banana Republic guy. Were you not? >> Oh, definitely. Yeah. >> All right. >> Guilty. >> So, yeah. I feel like Banana Republic was always like a stretch store for me like in in in high school like if I wanted something very nice and uh I would use I think when I got that >> Yeah. I graduated from GAP to Banana Republic after college. I think that was >> Were you a big Abberrombie guy? >> I surprisingly I was never an Abbercrombie guy. Uh, >> you know the you know me, >> you know the Vince McMahon meme of like it's three of him like like >> Yeah. >> having a a explosion on his face in PG-13 terms. Feel like for you it was like J Crew, Banana Republic, Hollister. What was it? >> No, J Crew was always top of the line there. >> Oh, yeah. Okay. >> Oh, yeah. That was always the >> Well, anyway, my point is this. Did you I didn't even know the Banana Republic was still a store. So, I went in and I bought a button up or down. We won't relitigate this, whatever it is. And it was a perfectly nice shirt. Uh, I saw the tag. $75. Oo. 50% off. Done. 37 bucks for a a shirt. Guess who's not participating in e-commerce? That store. Those guys. What do you mean? Sure they are. You know, you buy people buy stuff online at banana.com. >> A a nice shirt was $37. >> Oh, yeah. You don't buy stuff from those stores unless there's a sale. And they always have a sale. >> They must be getting absolutely torched. >> I That's a Public App. Uh >> Oh, yeah. That's right. I remember back in the day. That was like I remember that was like one of my earliest like business memories when I learned that Banana Republic, Old Navy, and The Gap are all owned by the same company. You were like, "Wait, they could do that?" So, here's a good segue because that is like the higher, middle, and lower classes of the economy back in the day, right? >> Yeah. >> Okay. Two-speed economy is back as low-income Americans give up gains. We've talked a lot about this, but it's after tax wages uh change from a year earlier and the higher end is going up. Middle is kind of stuck and the lower end is going down. And this is something we've been talking about for a few months now that this is a total sea change from where we were in 2021, 2022, even 2023 when the lower end was seeing the biggest gains. There's a bunch of quotes in here that maybe you can pull from. But my only big takeaway here is that there is never ever going to be an economic environment that's going to make everyone happy because it was the higher end that was unhappy when the lower end was hanging big wage gains because it was like, hey, I I own these things or I my margins are getting hit. >> There was a white collar recession. You're right. Yeah. Now it's reversed and there's just literally there can't be an economic environment that everyone's happy. It cannot exist. >> Yeah. One of the quotes in here that stood out to me was um the premium cabin revenue for United Airlines was up 5.6% while the economy cabin was negative. >> Oh yeah. That which makes sense to me. >> Yeah. You know that but that's that's a really good bow on on all of this is that >> but don't you think part of that increase is the fact that they can probably charge rich people more because they know that they'll pay for it. >> Yeah. But there's well but there's also more demand from rich people. It's part of the same thing. You know Josh's book was based on this that what was Josh's book that or his blog post? >> Well, he wrote Yeah, he wrote the blog post out coming out of COVID saying >> they didn't want you to see that >> if we if we gave everyone money like we did in CO it broke the economy essentially. That was his Yes. >> Oh, you weren't supposed to see that, right? That was it. >> And Josh's point was, yeah, you weren't supposed to see that. That was Josh's book based on that blog post. Um, >> when everybody is is winning, we all lose effectively that like that broke the economy. Too much winning. By the way, the Charlie Sheen doc, speaking of winning, it was kind of weird that it was and it was it was entertaining, but they didn't like go into like why he was so insane >> because he was an actor in Hollywood for >> I know, but like why was he so damn destructive? I mean, they get into it a little bit. >> Bizarre. Anyway, um >> Ryan and Sonu have this chart. They have a proprietary leading economic indicator index. and slowing economic momentum, but no sign of recession yet. >> What was the thing Neil Da said about leading e economic indicator? Aren't they all kind of like back filled essentially? >> Well, this is proprietary. >> Okay. Well, >> maybe maybe you missed that part. >> All right. What's this? You have a new substack here. Oh, so a listener created a substack called Chart. Chardonnay. Yeah, it's a play on words. Chart. >> Okay, that's actually not bad. >> I remember someone early on said, "Why didn't you call it a Wells of Common Sense and spell it C E N TS?" Because then I would have to punch myself in the face if I did that. I No, sorry. >> You ever see this chart before? >> Chardonnay. That That's pretty good. I've never heard that before. I I'll give I'll give him credit. So, I was I was poking around uh his substack and there are some wonderful looking charts. So, the one that I pulled out for today is he breaks down he shows a bubble chart of the monthly inflation rate by decade and he shows uh it's it's gray circles and then the blue is the average and then the red is the most recent one today. Isn't that wild? >> It is kind of funny. People are talking about inflation heating back up when it's like 2.9%. And that is below historical averages. To your point, like if you showed someone this chart and said inflation is heating up, you'd go, "No, it's not." >> Yeah. I think just >> from what >> directionally is, but this is a gorgeous chart. I've never seen it laid out this way. >> Yes. I like the little charts. Good job, Chardonnay. >> Okay. Um let's get rid of this. So, I last week I went on a bit of a tirade about how annoyed I was from that Financial Times article. Just pure horseshit, >> you know, really got you going. >> It really did cuz it was just it's just so it's just the perfect representation of everything. And sorry to pile on them specifically because they're certainly not alone in this. Um, and I understand the motivations and why they have to do that, but man, it just grinded my gears because it was just such nonsense. They led, for people that missed last week, they led with an inflammatory statement about private credit that pedes are pulling back and they had on the cover, the Cincinnati pension fund CIO, they managed $3 billion. And then the footnote at the end was like, but not all they're convinced, but but but uh not all they're slowing down. New York City pension $300 billion says they're uh all in or or permanently committed or whatever they said. And the article was backward. >> Also, I don't I don't blame the authors for that because the people who write the articles do not pick the headlines. The editor or whoever runs the >> Okay. But the article that's true and also the article was backward as well. which if it was telling the truth, it would have led with New York City and then it would have said, but not all are convinced that the momentum is going to continue. Cincinnati's blah blah blah. Okay. All right. Anyway, so I wanted to get that on paper, but I just I'm moving. I felt lazy and I just wanted to see what Chad could do and it wrote a pretty damn good article in a second. Now, it was apparent to the reader and myself that I didn't write it. So, I wasn't trying to like pull the wool over anybody's eyes. And at first, like I felt like, oh, this is lazy. I felt dirty sleazy. Not sleazy. That's the wrong word. Um, misleading, whatever. I didn't feel great about it. But you know what? This is just what it's going to be. Like >> I felt sleazy reading it though after. >> But here's the thing, though. When I >> This is But this is just what it's like the the genie is out of the genie is out of the uh the lamp >> and it's not going back in. >> Uh but here's the thing. Like I even on Grammarly all so I have Grammarly because I I have Grammarly and I still somehow get um grammatical errors in my post which I don't know how but and I have one guy I told you who's for the last seven years has sent me, hey Ben, there's a grammar error in your blog. Fix it. He right away >> you are too nice. >> I can't believe that you still allow somebody to to fix your grammar. It's just like dude buzz off. So, I forgot to mention >> No, he's he's a very nice He never says it in a there's because people will say it in a condescending mean way and then then you tell him to buzz off. But this guy is very nice about it. I'm sure he is. Here's the thing. >> No, wait. No, wait. You're very nice. Uh you told me on your trip out to California that a lady next to you, was she on her speaker phone and the flight attendant came up and told her to knock it off? Most other Americans, certainly outside of the Midwest, would have turned to this woman and said, "Lady, no, I'm just kidding." It was, "Excuse me, do you mind?" >> It was a lady behind me. And everyone was doing the look behind like like and finally the flight attendant said, "Ma'am, do you have any earbuds?" And she said, "No, I don't." And late and then the flight attendant very sternly said, "You're going to have to get off speaker phone now." And everyone was like, I wanted to stand up and clap. It was absolutely amazing. But here's the thing. When Grammarly gives me the things to say, and you're you're to your point, you can tell that you didn't write this. It was chatty. Like, when Grammarly says, "Change this from this word to this word," I always think I would never in a million years write this word. >> So, I'm not going to use it cuz it it it doesn't sound like me. >> Yeah. >> But that's the thing that this is why the AI like being a commodity, >> you're if you want to stand out, you have to be creative and have your own voice. Now, you can't just do cuz Jet GPT, if you want to sound smart, is going to be smarter than you. >> Yeah, I think you're right. I wonder if people just start tuning out to think things that are obviously written by Chad GBT. >> Unless it's like a news story that they want to be caught up on, but if it's an opinion piece, I don't want to read an opinion piece by Chad GBT. I don't care. >> Of course not. Of course not. Um uh so Mike Shields, I'm not familiar with with who that is, but uh our friend Alex Canitz had him write a post on his Substack talking about, >> you know, you are like a you are pushing a lot of substacks today. I feel like this is an alltime high for Michael's substack recommendation. I I love supporting the artists in our industry. These are great creators and I pay for all of them. >> It is funny. I can't remember someone at Future Proof asked me saying, "Hey, I want to start a Substack. I'm a little nervous about charging money." And I said, "Dude, everyone does that now. This is this is not the kind of thing where people are afraid of it anymore. Like if if you have something to say and people want to read it, people will pay. You shouldn't be shy about uh charging money if this is going to be part of your >> Is that kind of crazy? Hey, I'm afraid to charge money for my services. Now, I understand that there's a lot of things that are free on the internet, so I get that feeling like we were definitely there at some point. Um, but if it's good and if it's quality and if it's work, you deserve to be paid for your time. Crazy idea, >> right? >> Um, all right. Anyway, this article was about Amazon's rise in the ad business. And one of the things that we didn't mention earlier in the stock market conversation is that a lot of the stocks that are being disrupted by tech and Amazon specifically like the trade desk for example are getting smoked and are probably unless they somehow pull a rabbit out of their hat are permanently impaired. >> Okay. You mean like the college textbook places and >> all that [ __ ] Yep. There's so many of them. I I didn't we have a chart on on the companies that are impacted or by by AI that are getting their teeth kicked in. Come here. >> So, how is that a is that a long short ETF yet or should it be? It It shouldn't be. Look at this little guy. We have We have Temple today, right? Love you. >> That's a nice looking haircut he's got there, huh? >> So, I took him the other day and Robinson said, "Not too short." And they went very short in size, but gosh, is he adorable. All right. Anyway, um, sorry about that. Uh, my point is this. Amazon's ad business. So Mike Shields writes, "Backed by a massive audience, reams of consu consumer data, and strong technological chops, the company pulled in 56 billion in advertising revenue in 2024 and another $13.9 billion in queueing up this year." So Ben, the conversation earlier about what if it takes 10 to 15 years, nothing takes 10 to 15 years. Back to Mike, he said, "Considering that Comcast NBC Universal, which had a 100redyear head start, brought in just north of $2.6 6 billion in ad sales last year. It's fair to say that Amazon now runs the world's greatest side hustle. Dude, NBC NBC Universal brought in $2.6 billion of ads. Amazon did 13.9 billion in the first quarter of this year. These companies move so fast. Their moes are so wide. It's unbelievable. >> It's also funny that Amazon and now in the same business in a lot of ways in television. >> They're in every business. These companies are in every business. So again using chat GBT I >> love how you did you tell chat GB put an animal spirits thing in there >> I did I did so this part this part didn't work very well at first I put in the middle I'm like no lower left no below the axis I not over I'm like all right it's good enough >> the simple stuff it always has a hard time with which is funny >> so advertising revenue I had I compared Amazon with Meta and Google and obviously well this kind of surprised me I didn't realize how far ahead Google was of Meta did you Google's at like 260 Meta's at 160 60. >> It makes sense. They had such a long head start, you know. >> Yeah. But Amazon is coming up the rear. So then I had it show show me the growth. It said, "Do you want to see the growth since 2019?" So I said, "Sure." Amazon's up 400% since 2019 off a much larger base. Meta and Google are significantly behind. And then I said, "All right, that's not apples to apples." Because again, the base of these things. So I said, "Show me the year-over-year ad revenue growth." Um, and Amazon came out smoking, has since cooled off as as they grow. And now their their year-over-year growth rate is roughly in line with with Facebook and uh double that of Google. Anyway, my point is all this in two seconds. Pretty magical stuff. >> All right. And your other point is that to it's not going to this stuff is going to happen really fast. >> Really fast. >> All right. Let me take this thing out. >> Dude, this isn't like uh crypto where we're still waiting for a consumer use case like a killer app, >> you know, >> which just might never happen. Might or might not, but this is this is coming. >> Oh, you guys talked a bit about the board ape stuff, but I remember a couple years ago, Michael was buying some of those basketball card NFTs where he owned highlights. Whatever happened to with those? Can we please get a full P&L breakdown? Uh, yeah. I was having a lot of fun during the pandemic. I shockingly didn't lose money on this. Or if I >> was that called again? >> Top Shot. >> Top Shot. There you go. >> Or if I did lose money, I >> at one point you talked me into buying one of those. I bought it and I sold it like a month later. I was like, I I I feel gross. I can't do this. >> Yeah, it was a it was a hell of a fun. I think it probably lasted five weeks for me. I remember I bought I spent like $1,000 or maybe two on a Devon Booker one and I was like, "What am I doing?" Um, but I didn't lose any money. So, that's the P&L update. Um, or if I did, it was it was nominal. Uh, all right. Last week, uh, oh, last week we spoke about all the zombie unicorns from 2021, >> right? Ways raised hu Clara was one of them, right? They were at a $45 billion valuation. They IPOed at 16 maybe. Yeah. So, StubHub, those sons of [ __ ] um, they raised at a valuation of $16.5 billion in 2021. Now it's down to eight billion. >> How many people made StubHub extra fee on their IPO jokes on social media? >> Yeah. Um, >> Doug Bonapart definitely did. You know, he did. >> That's a That's Yeah, that's right up Doug's alley. Speaking of that, um, skipping ahead a little bit on the dock. So, uh, Mark Rubenstein, net interest, that's a Substack, one of the best, wrote about, uh, IPOs. We we we've been speaking a lot about these lately. He said three quarters. So, he's talking he was talking about the the zombie ones, the fintech ones specifically from 2021. That's his beat is is fintech. Three quarters are trading down from their IPO, including one that went to zero and eight that were returned to private markets at steep discounts. Um, Robin Hood is up 200% over 200%. A firm 86, New Bank 78, and Coinbase 37. The average return of the other 35s of the other 35 negative 30%. Interestingly though, he also says that's not to say these new issues didn't create a buzz at the time. All but nine popped on the first day of trading, gaining an average of 30%. While the few that declined lost only 7% on average, >> right? So, if you didn't get shares, you got hosed on these things. >> So, the fintech class of 2021 uh not great. And last last thing on this topic, we we mentioned um the cost of going public. I've never seen it broken out this way. So, this this was interesting to me. I'd like to I'm sure there's data out there, but he said talking about the cost of going public, Chime incurred $14.8 million of offering costs in addition to $43.5 million in underwriting fees on its $829 million of gross proceeds. So that is wild. So 153 it's 5%. 5% to go public. >> Okay, that sounds like a lot. Blockchain should fix this. >> I mean, I guess 5% sounds like a reasonable number, but if you think about the dollars, my gosh. >> Yeah, but to my point about last week that most IPOs are crap investments. That's true. And and one good one can probably dwarf all the bad ones, but there's a lot a lot of bad ones out there. >> We had a reader a few years ago um when I was talking about like the luck involved in in holding a lot of the biggest winners. This guy said, "Hey, dude. My this is like my strategy. I bought all the new issues or a lot of the new hot issues and I just held them all and the ones that went to zero went to zero, but the couple that went up 4,000% took care of everything else." And yeah, valid, good strategy. Credit to that guy. >> All right, let's talk about the housing market. I've been on this beat for a while. I said this when Trump got elected president to you and Josh. And this is from uh Market Watch. This longshot move could get the 30-year mortgage rate to 5% next year, says BFA Global. So, team of Bank of America strategists said that they think there's a probability that the Fed once again engages in mortgage back security QE, meaning they buy mortgage back bonds, which they did in the pandemic. That brought mortgage rates down way, way below. That got them to 3%. Um, and they're saying we could see 5% by 2026 midterms if Trump exerts more control over the Fed. And I think once someone gets in his ear about this, and honestly, to me, this makes sense because if if that's your really concern is getting housing activity going, this makes more sense to me than the Fed lowering rates. The Fed lowering rates is not going to automatically push mortgage rates down. >> I agree. So, I think that this actually and I've been pounding this to get the spread lower. I think this makes sense. I think that they probably should do this. People would be up in arms about free markets and this kind of stuff, but >> nobody cares about anything. >> Fair. But I I actually think that this is a better policy than the Fed just trying to lower rates and hoping that bond yields come down. >> Yeah. Yeah. the the housing market is obviously a massive story in and of itself and we're not going to cover all of it today, but one of the big stories is is the decline in building permits. Kevin Gordon showed a chart of the consecutive monthly declines and it's the highest since the great financial crisis. Now, there's obviously a lot lot lot more to the story, but the housing market has all sorts of impaired du. >> Yeah, the hurdle rate right now to build is is too high probably. So, somebody who's sharing this chart, um I think LAR just reported I I didn't dive into it, but LAR was subsidizing a lot of the buyers, right, of of new houses and they were they were helping ease the burden of high interest rates. They were doing that and I think Dr. Hordon wasn't and the spread between the two. I I apologize who I'm lifting this from. I can't remember where I saw this. >> Yeah, I think I saw this too. And it just saying that the the home builder that cut back is doing way better than the home builder that went all in and was building more >> and and that was subsidizing buyers, which is which is I guess not that surprising, but that was that was really good stuff, >> right? It should be the the government subsidizing the buyers, not the home builders. Come on. >> Yeah. Um the from Red Fin, the median US home sales price rose 2.2% year-over-year, the biggest increase in five months. And why isn't 2025 on here? Is this old? Oh. Oh, the green line is the green one. >> Yeah, my bad. >> Um, wild, huh? It's still at all time highs or right there. >> No, of course. Rates are high. Prices aren't coming down, right? >> Yeah, >> this makes sense still. >> Um, all right. We are getting long in the tooth as they say. Somebody had a really good email about um about uh what is this? >> Mortgages. mortgages are adjustable rate. >> God, the guy was like, "Dude, that's complete nonsense." And and Mike, why don't you uh give us an update on your your your housing move, which I will do next week. Um but because there is there's uh I got some some good stuff to share, but uh we're getting longer. I got >> I got a couple charts then I'm done. Okay. Well, actually, skip the charts. I want to go to this. Okay. >> So, this one I tweeted this and it got a lot of dang responses. >> Which one? >> This is from Y Finance. 61% of boomers never plan to sell their homes, while 76% say they're tired of being blamed for the housing market. This is a survey, obviously, so take it what's worth. Um, nine out of 10 boomers, 88% say they don't care if remaining in their homes prevents younger buyers from entering the housing market. >> Yeah. Why would they? >> Threequarters say they're tired of being blamed for the housing crisis. It is just funny because it's like, what are they supposed to do? Where are they supposed to go? >> Right. >> Duh. Yeah. It's not their fault. I think just the way that this survey was worded though is hilarious to me because they're trying for inner demographic warfare. >> Well, you know why? You know why I'm bored by with this inner demographic warfare stuff? It's cuz this is always the case. This is not unique now. >> I think it's I think it's going to get worse though. I think the housing stuff is going to make it even worse than ever. assets, retirement assets, wealth is a 21st century phenomenon largely and generational transfers like so >> big boomers are the richest generation ever and so it's going to be worse than ever I feel like in the next 10 years >> I agree with you I don't really want to partake in the in the uh >> I mean unless the boomers move into old person homes like where are they supposed to go >> yeah I'm not going to participate in the discourse it's just not that interesting to me and uh and I love my parents so there >> yes but young there's going to be a lot really angry young people that are mad at the wrong thing in the years ahead. >> Uh all right. Um oh here's another chart in a look at this chart. So we haven't really done many survey of the week type uh diet tribes recently. But one of the problems with surveys is that people don't answer them anymore to the degree that they used to. So chart has this amazing chart title. Believe it or not no one's at home. the response rate for the BLS current population survey of the unemployment rate from January 2019 to August 2025 and he shows the monthly increase or monthly decrease and people respond anyway. It's down to the right. Nobody's nobody's answering the phone. >> So it was 83% pre- pandemic. Now it's 69%. Uh I can't believe that it it was as high as over 80% in the previous period. Still seems high to me. >> Higher than I would have thought. But we know that the quality of the responses is deteriorating and he quantified it very nicely. >> I guess the hope is that we have so much other data to go on to like back this stuff up that it doesn't matter that much. But I don't know. Hulk Hogan. According to TMZ, uh the WWE legend's son, Nick, filed court documents Tuesday obtained by US Weekly, which says, man, how is US Weekly still a publication? Oh, US Weekly. My bad. Right. Is it US? >> US Weekly. Yeah. Okay. >> So, his son that was remember his he had a a reality show. >> Yeah. Um All right. So, he left behind $200,000 in cryptocurrency. Wonder what it was. Looks like a fartcoin guy to me. >> Litecoin. >> Um $799,000 in personal property and intellectual property >> as well like his bandanna collection. >> Uh don't don't bismerch the Hulk. As well as his right flags >> his right to publicity worth about $4 million. I'm not exactly sure what that means, but not a lot of money. >> So, this is saying that he was worth, I don't know, $5 million. >> Yeah. >> Wow. How is that possible? >> I guess he enjoyed his money and spent a lot of it. >> Okay. I would have guessed he'd be worth $50 million. >> All right. I would have said 20, I think. I don't know. >> We have we have to give a mayop to our European people. >> Okay. So many emailed in in the UK. It's true that last week we talked about how >> by I feel bad about I feel bad about my croissant truck earlier on. That was that that didn't didn't feel great coming out of my mouth. I apologize. Don't want to >> be >> uh in the UK it's true that equities only make up 10% of household wealth, but that excludes money purchases for DC pensions. Um I think the US data probably includes retirement accounts. These pension accounts uh these pensions account for 35% of total wealth in the UK. A lot of those assets are in target date style funds. So, it will vary, but you could probably assume that means at least a further 20% in equities. Um, side note, there are relentless bid effects here, too, because we have auto enrollment with minimums of 8% of earnings going into money purchase pensions. That links up with what we've spoken about in the past of foreign flows into US stocks. A lot of these target date funds are market cap weighted. So, anyway, like they have to put money into their pensions and that money is getting invested in equities. So, it's just not being counted as like direct purchases, but it it is there. Um, okay. I've talked in the past about people on flights, the people you see on flights. There's a new business traveler that I see every time I fly. Okay. >> This is a gentleman and usually he's in a group of three to five other gentlemen. Okay. >> They wear, >> of course, when they at the bar they have Bud Lights or they have Micholtas. Okay. The tall ones. Um, they wear jeans, they have boots on, they wear polo shirts. Many of them wear hats. And I'm pretty sure there's a 95% chance they are either owned by a private equity company or about to be whatever their business they're in is about to be purchased by a private equity company, right? HVAC or but you if you start looking at the airport, you will see these guys polo shirts, jeans that are a little too big for them, boots, and probably a hat with a really bent brim. And there's three to five of them together all the time. >> When you say boots, we what what type of boots are we talking about? Like >> worn in boots. Could be not cowboy boots, but you know, like workish boots. But so these guys are like they they are like people who have come up in physical work but now are in the management roles. >> Okay. >> And they that's a new line. I I saw four groups of these guys yesterday. I swear to God. >> Are these like land man's coming back >> cuz they were drinking Mick Ultra. So they had to be And guess what? I got one too because I I'm gonna be Billy Bob now. >> I've never had a MC Ultra. >> I don't drink anymore. I um I it's MC Ultra. Um, here's a question. Will you have hair by age 50? >> Definitely not. I am bald. I am bald for life. >> Scientists at UCLA found a drug called PP 405 that reactivates dormant hair follicle stem cells, potentially enabling new hair growth rather than just slowing loss. So, is it possible we'll solve obesity and hair loss in our lifetime? >> Okay. Obesity, it seems. Check. Hair loss. >> If you could just take a pill and your hair would grow back, you would definitely take it. >> No, I wouldn't. I would only take the hair loss. I would only get my hair back if I got divorced. Here's why. I mean, that's the the why there is obvious. Here's why. >> No, no. You'd have to get it if you got a convertible. Uh, >> no. Here. No. Uh, here's why I'm out on hair. I don't want to have this conversation with everybody that I see for the next 10 years. There's I see a lot of different people and there's a lot of people Oh, there he is. that I haven't seen in four years. I don't want to do that. I don't want to do that for the rest of my life. >> Okay. >> I don't care. 37 years of America's favorite drink, Charted. This is from Charter. Um, a lot of people drink Dr. Pepper, which surprised me. This is like the only one that's really straight up into the right. Actually, Fanta and Coke Zero. No, not Font. Coke Zero. Coke Zero. That's a That's a thing. All right. Anyway, >> Diet Pepsi. This thing I drink. What are you gonna do when Diet Pepsi goes away? Because this thing is on the decline. Nobody should drink Diet Pepsi except for you. >> I drink Coke Zero and Pepsi Zero now. >> Oh, Pepsi Zero. >> I think Coke Zero and Pepsi Zero better than Diet Coke or Diet Pepsi now. That's my new caffeine intake. >> Okay. Um All right. So, this is just perfect. We're we're moving and Robin's getting frustrated. I'm I'm probably on my computer. I'm like, "What?" So, Robin says, "I'm doing like 30 things at once." So, I very nicely said, "What can I do to help?" nothing. They're already done. >> That sounds about right. I have a little I have a little youth sports diet tribe. Um I feel so when we were growing up, I don't know that my parents ever said two words other than hello, nice game to my coaches like football and such, you know, >> right? >> Um now we have all these apps where parents can chat with the coaches and send them messages and it's cool because they can say, "Hey, practice time has changed or the game's going to start here instead of here." So it's it's helpful. Hey, my son I don't I can't get a ride for him. Can someone pick him up? So, it's cool, but it's also I think there's way too much communication because now the parents that want to complain about playing time. My son is playing football and we've gone from flag football where there's like five kids on the field and hey, everyone gets a carry every game to we're playing tackle, there's 11 guys on the field and guess what? There's five guys on the line. There's like a tight end, a couple not only two or three guys are going to get the ball every game and guess what? The parents don't like it. So the coach had to send out this thing saying like, "Hey, I tried to set expectations at the beginning of the year, but so I feel like the the access to coaching has to make it way worse for coaches, >> right? >> It's great for scheduling. It's got to be bad for PE the complaining parents >> and obviously as as our kids get older and many sets of parents have been through this before us, but we are now seeing that uh guess what? The kids that are good play more. Duh. And there are parents >> that live in this reality and understand how the world works >> and go with the flow. And >> this kid is obviously more talented than my kid. He deserves to get the ball more. >> Yeah. And then there are parents who live in an alternate reality uh who are just >> I don't know if not great people is too far because they're just, you know, it's their their children. They want to do what's best for them, but this is not what's best for them. Just get over it. Relax. Calm down. >> And they're Yeah. naive, I guess. >> Yeah. Okay, la last thing that I didn't consider is one of this is this is not a subtle detail as we talk about like us drinking back in the day and enjoying our party days. Um, somebody said they were born in 96, their wife was born in 01 and he's like listen uh there's a big gap between us in terms of like technology even though it's only 5 years. When I was in college and when we were in college, certainly there were no phones. Like people weren't recording every detail and that changes obviously everything. If you had to worry about what somebody was going to put on TikTok the next day, dude, my behavior, I would have gotten canceled to oblivion uh every time I drank. You know what I mean? >> I would have I would have been a different person instead of hearing from my five friends, hey, do you the thing you did last night? >> Like that was embarrassing. Like, oh, I forgot about that. To >> imagine it's like school can see it. Yes. It would changes everything. So that sucks. >> I I agree. That would totally change your behavior. It's like living in a reality show all the time. >> Yeah. So that was like a light bulb like Oh, yeah. Yeah. Of course, of course. I get it now. >> All right. So I we watched you mentioned Black Rabbit a few times. We watched it. Um listen, it's a it's a very cliche show. The the brother the brother who's the black sheep comes back and the um you know the restaurant stuff. I feel like every restaurant show or movie now has to have the one night where hey the times critic is coming in. It has to be perfect. >> But having said that so it is a little I only saw two episodes but I'm all in. I love the black sheep brother. >> It is a little cliche. I think Jason Baitman is underrated as an actor. He's good in everything he's in. >> No, he's not underrated. Everybody who doesn't like Who doesn't love Jason Baitman? >> But I feel like he's he seems like he's kind of just playing himself but he he's always believable in every single part he plays. >> He's fantastic. I don't think anybody would say otherwise. He's properly rated. Jude Law's American accent, but >> Oh, really? I I was going to say I thought it was very good. He's deeply British. >> I think he's he slips in some Anyway, um so they're trying to get money to pay off these people that they own. Um and they got to come up with 20 grand a week to pay these guys off, otherwise they're they're dead. Uh Jude Law doesn't have a 401k and IRA he can tap. Nothing >> for that age. I guess he works in the restaurant business. Anyway, I like it. It's it's it's a little cliche at points, but I still I'm I'm all in. Obviously, I'm watching it. >> Was that a Grand Rapids hedge? What was that? >> You like it? There was like a hesitation in your voice. You like it. It's cliche, but you're all in. No, you're all in. >> Yeah. So, here's the thing. It's a seven. Seven out of 10, not an eight out of 10. >> I feel like if you want to be prestige TV, you got to be eight out of 10. This is a seven out of 10, but it's still enjoyable. Uh, I started the paper, which is the offshoot of The Office that's on Peacock now. >> There's an offshoot of The Office, like a new one. It's like a new office. >> Okay. >> It's like so it's the same format as the office of like the mockumentary and Oscar from the office is on it playing himself. So it's like say hey we did a documentary on the office paper place now we're going to do a new one on a on a newspaper that's dying and um there's a there's a handful of actors and actresses that you've heard of and it has the same vibe as the office like the feel of it you know and uh it's not nearly as funny obviously it's it's and it's stealing some stuff but uh it got me to laugh a few times and it's good background show. >> Okay. Wow. >> So not terrible. Table Pounder. >> Finally, uh, Robert Redford passed away last week, I think. And for whatever reason, I'd never seen Butch Cassidy, the Sundance Kid. I've always heard it's one of the best westerns ever. Have you seen it? >> No. >> Um, fantastic. Yeah. I I'm usually a Okay. It was because it came out in 1969 and I'm usually like a gh. >> And I right when it started, I was like, "Oh, it's going to feel old." But those two guys, Paul Newman and Robert Redford, I think Newman was in his 40s, Redford was in his 30s. They were just oozing charisma. And it's like, oh my gosh, we do not have actors like this anymore. And I thought the only thing we've had as a modern comp would be Once Upon a Time in Hollywood with Brad Pitt and Leo who were older at the time. But it's I thought the first like hour of the movie was like unassailably good. I thought the end it kind of drifted away at the end and slowed a little bit, but it was really and it was written by William Goldman, so it had to be good. >> Okay. I will definitely watch it. >> It was good. and you got me listening to audiobooks somehow and I decided I have a I have 10 biographies that I've started to read picked up and started and stopped and started and stopped and I said, you know, I'm just going to listen to biographies and so I listened to Hamilton by Chernau and >> Wait, did you finish it? >> I'm 3/4 of the way through. >> How long would it have taken you to read that book? >> Oh, so long. And I got it on 1.75 speed. And the thing is that you said that you stopped listening to some podcasts. I have sports podcasts and pop culture podcast and then market podcast and I'm realizing like wait do I want to listen to this dumb podcast or I'm going to listen to the audiobook and I'm finding myself choosing the audiobook more and more. I have listened to I haven't listened to a podcast uh in a month. >> I'm gonna go on a hike later in the mountains here and I'm gonna bring my AirPods and listen to the thing the thing I picked up from the Hamilton the book and I'm not the obviously he had his run of popularity and I'm way late to this but just how young those guys were and how impressive they were and they would be shaking their heads and rolling over in the graves at the politicians from both parties these days cuz they were they were obviously they had their flaws but they were such high character intelligent individuals. integrity. They had it. >> Yes. They would look at the politicians of today and go, I can't believe this is what we have to choose from. These two poo poo platters. This So anyway, that's what I got. >> You're welcome. Um I too am listening to a biography. This might shock you. I'm listening to the power broker and it's 66 hours on one time speed. So I don't know how long it's going to take me, but this will probably take me three weeks. >> That's the Long Island guy. What's his name? >> So Robert Moses built New York City and the surrounding area. Long Island as well. >> Everything. Built it all. Um okay. Uh uh oh, you're not watching Task on on Max? >> Of course I am. >> Okay, we didn't mention that. I I I uh I think The Move has really buried me. I that and and Future Proof getting behind on work. My calendar is is my head is spinning, so I I've only watched one episode, but I I'm excited to watch more. Um >> it's good. >> All right, last thing. I popped on Field of Dreams the other night. I haven't watched that movie in full in 20 years. Like, why would I I know that movie like the back of my hand. I saw when I was four in the theater, not to break. Um, and the scene that I popped in on was Kevin Cosner with a fake gun in his shirt. And of course, you know exactly what I'm talking about. The chemistry between him and James L. Jones was ridiculous. So, I I only caught 10 minutes of it. What a dumb movie. Only in the sense that the plot is so insane. The fact >> it really shouldn't work. the fact that they were able to turn that into an alltime alltime alltime great alltime classic. So the scene with uh Go the Distance when they're at Fenway, it's so dumb. It is so dumb and it never occurred to me because I saw it when I was, you know, a baby. Um but god, what a movie. >> It's a movie that really shouldn't. I watched it with my daughter last year. It shouldn't work, but it still does. >> All right, I got to show it to my kids. I'm I'm going to cry at the end, obviously. >> I I did I I got a little teeyed at the end. I'm not going to lie. All right, so an hour and 16 minutes. This might be a new uh new record for us. I didn't even know this would be a long podcast. So with that, I want to thank uh Duncan and John and Nicole Daniel and Travis. Uh the team is going above and beyond. We are doing media. >> We are doing 19 podcasts a week. Graham and Rob of course too. Um, so in addition to that, we are full steam ahead on Talking Wealth, the show that we're doing for advisers. It is now on its own audio feed, Spotify, etc. called Talking Wealth. We understand that advisers probably don't want to sit in front of their computer watching an interview. So, if you wanted to tune into that content, but you don't have time to to watch it, you can now listen to it uh instead of audiobooks. So, check us out. We're out talking wealth and we're doing uh one or two conversations every week last week >> in around the the industry. That was very good. >> Very good. So, all right. Thank you everybody for tuning in. Happy New Year to my Jewish brethren and sisterin. Um animal spirits at the compoundnews.com. We'll see you next time. [Music]