Animal Spirits Podcast - A Fire Alarm For Interest Rates (EP. 466)

Episode Date: May 27, 2026

On episode 466 of Animal Spirits, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Michael Batnick⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠���⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Ben Carlson⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ discuss: the SpaceX IPO, index fund bag holders, the pros and cons of rising bond yields, the markets got the war right, how consumer sentiment broke, the Bezos tax plan, AI optimism, did crypto miss its moment, the coming renovation boom, dad books and more. This episode is sponsored by Cullen Capital and YCharts. To learn more about Cullen Capital and DIVP, visit https://www.cullenfunds.com/US/A/ETF/DIVP/ Visit https://go.ycharts.com/animal-spirits get 20% off your initial YCharts Professional subscription. Sign up for The Compound newsletter and never miss out: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠thecompoundnews.com/subscribe⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Find complete show notes on our blogs: Ben Carlson’s ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠A Wealth of Common Sense⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Michael Batnick’s ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠The Irrelevant Investor⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Feel free to shoot us an email at ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠[e-mail]⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ with any feedback, questions, recommendations, or ideas for future topics of conversation.   Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Ben Carlson are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. The Compound Media, Incorporated, an affiliate of ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Ritholtz Wealth Management⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. For additional advertisement disclaimers see here ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://ritholtzwealth.com/advertising-disclaimers⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Investments in securities involve the risk of loss. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. The information provided on this website (including any information that may be accessed through this website) is not directed at any investor or category of investors and is provided solely as general information. Obviously nothing on this channel should be considered as personalized financial advice or a solicitation to buy or sell any securities. See our disclosures here: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://ritholtzwealth.com/podcast-youtube-disclosures/⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to Animal Spirits, brought to you by Colin Capital and DIVP. Most income strategies make you choose between yield and growth. The call-in-enhanced equity income ETF, DIVP, doesn't. Unlike strategies that write calls on the entire portfolio and cap your upside every month, DIVP strategically covers only 20 to 40% of the portfolio holdings at any given time, meaning 60 to 80% of the portfolio retains full upside potential. And rather than applying that to a broad index exposure, we do it on a concentrated portfolio of high-quality, large-cap value-oriented stocks.

Value-driven, income-focused, built for the long term. This is DIVP, and this is how we think about income differently. Today's show is sponsored by Y-charts. One thing we're excited about is a new offering from Y-charts called Communities. It gives advisors a way to follow research insights from voices they already trust directly inside the platform thousands use for daily investment research and client communication. That means instead of trying to recreate the charts or analysis after listening to our show, As a Y-chart subscriber, you can quickly pull it up and work with it inside the platform.

It's designed to make following Market Commentary feel more actionable, integrated into one's daily workflow. We're excited to be one of the first communities available helping advisors bring our charts in Market Commentary into their day-to-day Y-charts workflow. Click the link in the show notes, check it out, plus get 20% off your initial Y-charts professional subscription, new customers only. Welcome to Animal Spirits, a show about markets, life, and investing. Join Michael Batnik and Ben Carlson as they talk about what their very.

reading, writing, and watching. All opinions expressed by Michael and Ben are solely their own opinion and do not reflect the opinion of Ridholt's wealth management. This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Ridholt's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. If you've been following the show up for the past two months, you know that Michael is a kind of a Knicks fan based on his attire. Would you say 90% of your clothing these days is Knicks related? It's got to be clothed, right?

Yeah. Congratulations to you. It's got to feel great. You're a diehard Nick. You're not just like a casual fan. You're a diehard fan. So I have a personal finance question. But you're a Knicks season taken holder and have been for how long?

I'm almost crying just thinking about the next. It's been so fucking long. My dad started taking me to games when I was probably my kid's age, around seven or eight. and as much as sports can be an absolute waste of time. And sometimes I'm envious of like Chris, who literally has not a care in the world about what's going on. Right? It's a giant time commitment.

But the bonds... It's a mental commitment too. You're like, why am I so mad about this? It's anguish. Why am I so mad about this? Sports. Sports are constant misery, punctuated if you're, lucky by a little bit of happiness.

Yes. That's what being a sports fan is. But the bonds that it builds between parents and children, between friends, it's like, I was about to say it's all I have. But that's what my dad and I talk about. Yeah, me too. My dad and I, it's the same thing. And yes, so Michigan's won two national championships this decade.

It's been a long time between those two. And I got to do it with my kids. that made it even sweeter. So here's my question to you. You're a next season ticket holder. I want to bring this back to finance. So the greatest thing is you have anticipation while you wait for those series to go.

So this week, you're just on cloud nine all week. You don't have to worry about the games for a little bit. It's great. So you will get the... You guys won't be the home team, right? Either way? Correct.

Okay, so you'll have game three in New York. How much money would someone have to give you to take those tickets from you? What would be enough money where you'd go? No. Okay, fine, I have to take it. If someone said, Michael, I'm going to pay for your mudroom for your tickets.

I'm glad you asked. I'm glad you asked. So one of the benefits of being a next season ticket holder is I am able to get season ticket prices. Tickets are a fortune. Right. An absolute fortune. So for round one, my face value was 350. Then I went to 580, then 7.50, and the finals are 1350.

If you were to buy off Ticketmaster, which is like the primary secondary market, it is obviously a lot higher than that. And secondary market, like, if you want to tick pick, forget about it. It's bananas. So one of the nice things is I now have flexibility. So, for example, we sold game five. Now, there is no game five for the CAF series, right? Because we swept them.

But we sold my tickets for, I can't remember, $2,200, something like that. And we bought tickets in the section 200, where one, We bought Section 200, like the second bowl, for 900 or whatever it was. So we got paid a thousand. We would have got him paid a thousand dollars. So you can trade up for a nice receipt? Yeah. So you're going to be sitting by Shalmay?

No, no, no, no, no, you're missing it. We would have traded down. So we would have paid, we would have gotten, we would have gotten paid a thousand dollars to go to the game. Okay, gotcha. I got you. All right. So for the finals, my friend texts and me, we sold our tickets for game four, for $4,400.

Okay. And I set him, wait, whoa, whoa, timeout. What are we doing here? And he said, we spoke about this. I don't remember speaking about this, but fine. So if we are down three nothing, it will be the greatest sale of all time. I'll give him a big, fat, wet kiss. All right.

But assuming we're not down three nothing, now I'm getting a little bit nervous. Right. Because we have to buy back in. I'm not missing any games for the finals. We have to buy back in. Of course. So what would I sell to, well, I guess there's your answer. Although I didn't hit the sell button.

He did. Okay. So I'm not sure. I would not have sold. So we know your friends. We know your friends amount. 4,400. So I will be traveling.

I'm going to, I think I'm going to game five, assuming that we're not down, you know, assuming that it's not a sweep. If we're down 3-1, I'll still probably go. So I bought tickets for San Antonio.

Might be premature. I think San Antonio is going to win, but I'll buy tickets for Oklahoma City, if that's the case. In any event, in any event, it's been a long, long time. And I'm feeling good. Yeah. It's a great feeling. It's a wonderful feeling.

It's a great feeling. All right. Let's talk IPOs. Paul Kodroski, he wrote about IPOs. He talked about, so it's open AI, anthropic, SpaceX. These are going to be massive companies. Each of them, probably a trillion dollars at least. That's pretty fair to say. I'd be shocked if the AI companies were a trillion, right? Yeah, yeah, yeah. Okay. He says, people aren't focused on the right things. That much new equity supply hitting in a few months creates a math problem. The money has to come from somewhere. Most of it will come from existing holdings. Passive funds will be forced buyers once these names join the indexes,

which will happen much faster than usual, given an exchange. So he's saying, like, what if this is a thing? And there's going to be a lot of stories about this. Like, okay, this is going to mark the top. This is going to mark the top. The funny thing is, I'm not worried about where the money will come from. People keep worrying about that all decade about, where's the money going to come from for this?

Where's the money? The money always just comes from. People have money. People have more wealth than ever today. The money will be there. I'm not worried about the money. I'm also not, I just don't think it's cute enough to say a headline thing like this will be it. I know that's usually how it works historically.

I just don't think, I think that's a little too cute. Yeah, I agree. Where will the money come from? You also have to think about, so there's a lot of smoke around the SpaceX S1, which was filed last week. Their average revenue per user is coming down on Starlink. that was the headline. You know, I love and hate the internet. I hate it because the headlines get all the attention.

Nobody reads anything for the most part anymore. I love it because there are still people that do the work. So, O'Mallek, somebody who I only recently discovered, he's been writing about the internet for decades. That's the broadband bandits book that I'm reading. So he wrote about the Arpoo Crash. He's like literally one of the first bloggers of history, so it's kind of funny that you just discovered him.

Yeah, I'm a little bit late to that. So there's a lot about the numbers, right? Obviously, like what's going on with SpaceX, which is... Can I read you some of the numbers from Axios real quick? Sure. So this is from Axios. SpaceX is wildly unprofitable reporting a $4.9 billion net loss on $18.7 billion in consolidated revenue for contacts.

200 companies in the S&B had more revenue last year than SpaceX. this includes Tesla whose sales were five times higher. Okay, so if you look just at the surface level numbers, the thing I love about this SpaceX is that the two narratives are so compelling. One of them is going to be, this is a wildly over, like $1.8 trillion company, you're kidding me? They don't make any money. And the other one is going to be, no dummy.

It's because they're going to have huge growth in the future and AI and all this stuff. And both of them are going to sound reasonable. They're both going to make sense. Yeah, but the evaluation part is always a lazy argument. So it's a spectrum, right, of exit liquidity. This is, you guys are sheep. This is the dumbest shit ever. Yeah, but the valuation always sounds smart.

That's the thing. No, it doesn't. No, when you look at the numbers, because you... You think people that cite valuation sounds smart? No, I'm saying they sound smart. Am I saying it is smart? No, I don't think so. Not me, not to me.

Not anymore. We've been doing this a long time. That sounds lazy. To a lot of people, though, the valuation is like, you can't argue the numbers. The numbers are the numbers. Okay, true. I would agree with that. I think people, you're right.

the headlines and the average casual investor will gravitate towards the headline numbers, the money losing numbers. There's going to be a lot of throwing your hands up for this. Oh my gosh, you kidding me. There's going to be a lot of that. But it's the same stuff with the macro people that have no understanding of what's actually happening. They just cite historical numbers.

Right. Lazy. Okay. So on a spectrum of... You're right. That's not doing the work. Just looking at the numbers at face value is not doing the work. Correct.

So on the spectrum of dumb as shit ever, $2 trillion dollars, LOL. which I get, you know, there is a lot of money. It's an ungodly amount of money versus changing the world. I'm like closer to changing the world than, now I'm not like, I'm probably like, you know, I'm Grand Rapids Heading list a little bit. I'm not all the way there because I'm not buying the stock, but we'll talk about it in the second. But on the, on the Arpoo crash, or getting back to what Om wrote, the customer mix explains

it. Maritime terminals. So Starlink is basically broadband in space. there are satellites floating in space that are connecting difficult areas, previously difficult areas to connect to the internet, okay? It's a huge global unlock, obviously. If it just makes Wi-Fi better on planes, that's good enough for me. That's all I want.

All right. So maritime terminals, which are shipping vessels, oil rigs, they pay between $250 and $5,000 a month and have no alternative. Aviation is even richer. A commercial aircraft terminal runs 12,000. $12,500 to $25,000 per month. These customers anchored Starlink's early Arpoo. Consumer residential is where the growth is now.

It is the lowest paying tier and outside North America increasingly price sensitive. Add satellite to mobile users via carrier partnerships at a fraction of direct subscription revenue and the mix explains the slide from $99 to $66 in three years. Maritime and aviation grows slowly and pay well. consumer grows fast and pays less each year. Thank you person on the internet. Oh, Malik, for looking past just the headlines and giving us the actual story. So I guess my grand repress hedge here would be like, could this also be an Airbnb story

where the valuation at IPO is so high, the stock just doesn't do a lot for a while. Like, I'm sure there's, there's going to be a massive pop on day one. I'm sure. But if you're like shorting this, you're probably not going to be happy. But if you're going super duper long, maybe you're not happy either. What if that's the hedge there? like Airbnb stock has just gone nowhere since it went public because everyone says the valuation is way too high.

Yeah. So same thing with Snowflake. If you go public at a hundred times price to sales ratio and if you are buying and holding the stock for three years, of course, I can't see the future. But probability, historic probability says that's probably not an awesome idea. Might does it not 100%? Might SpaceX be the one that delivers a world? change of results.

Yeah. But I think most people, most people don't give a shit about three years from now. They care about the next three weeks. You don't think they want the idea. Terminal value DCF calculations on this? Right, right. So how long until all his companies are under one umbrella, though? That's the end game here, right?

Well, they are. Everything except for Tesla. That's what I mean. It's going to be all together. Tesla's going to merge of these companies. It's going to be one company. That's the end game. So SpaceX owns XAI, which is,

Grock, and they are, I think, trying to buy cursor, which is not an Elon Musk company for the record. But how, oh, Twitter, X.com, how long before Tesla gets absorbed? Who knows? But here's here. I've never gone to X.com, just so we know. Okay. It's Twitter to me forever. Here is where a lot of the scrutiny falls. It's with the NASAC 100, rejiggering the rules for a fast entry. So previously, a company needed to be, I think the term they used was seasoned, whatever that means. I don't think that there was like an X number of days or anything like that.

I think it was three to six months. They're going to get into the index in 15 days. And this enlies the thing that people are excited about. Because, and credit to NASDAQ. So yes, they changed the rules for fast inclusion, which people are like, oh, this is a bullshit. Passive lead to liquidity. Okay.

But they also protected investors. because what they did was, so SpaceX is not going to be selling or issuing a lot of new stock. Right. It's low flow. It's public. It is going. So a lot of it is not going to be publicly traded. Elon Musk's portion, for example, is not going to be publicly traded, okay?

Or not going to be available. He controls it. So what NASDAQ did was he said, we've been burned once before with a similar IPO where there was a lot of insider shares being held. We're not going to give you the benefit of the doubt of your full 1.75. trillion dollar valuation. What we're going to do is we're going to do a modified market cap, which is not unusual. We're going to allow you to have three times your float inside of the index. And that's what we're capping it there. So if they float, I'm making this up, if they float

$30 billion worth of stock, then the index will hold 90 billion. The market cap in the index will be 90 billion. Right. It's not going to be the full value. Right. I think the actual numbers are closer to, uh, 150 and a hundred 50. There's going to be a lot of people going, oh, the bag holders here are the index fund people. That there's going to be a lot of that. So there will be a lot of, there will be a lot of stock that has to be bought inside of the indexes. That is true.

So if the NASDAQ 100, we're looking at like four to five percent, I mean, obviously, it's a, you know, it's a range. Um, so that's a lot of buying. And with a float that small, the number of buyers is a, um, if you can't see me, I'm holding up my arms, a gigantic circle of buyers, pool of buyers that want the stock. and the pool of supply is much smaller. So the valuation does not matter in the short term. But could you imagine if it goes up to $2.9 trillion

because of the way they financially engineered this, people are going to lose their fucking minds. Yes. There's also like weird cliff devesting, unlocking up of the shares where insiders can sell. But insiders are not selling at the open. This is, they are, they are diluting the shareholders. What's interesting is that they're giving a disproportionate amount to retail investors.

Numbers are still being finalized, but anyway, it certainly, it's certainly captured everybody's attention as you would, as you would expect to do. It's a big deal. And maybe this will be the first level thinking again. Like this, this really will be it, right? I'm waiting for that to happen. Come back. I don't know. All right. Kai Wu, who was on the compounded friends with this couple weeks ago, writes these long, what will you call them? White papers? Is that fair enough to say? Mm-hmm. I pulled a little, he had an AI disruption paper, and he talked about modes and value traps.

I just wanted to pull out one thing here. I don't know that was interesting, just to show how hard stock picking is. So he shows the biggest disruptors of all time. He showed how Netflix disrupted Blockbuster, Amazon disrupted borders, Amazon disrupted Radio Shack as well. And then Google disrupted McClatchy, which I didn't get McClatchy. Is that Encyclopedias? Is that an encyclopedia Britannica? The owners?

I can't remember it. He said in the paper. He's got a great chart here showing the returns of each. And they're both going in opposite directions, right? Where these other ones are just, you know, fall off a cliff. But he also shows the stock prices of these disrupted companies. So blockbuster reporters, Radio Shack and McClatchie. And it's funny because as the stock price is dropping,

the revenue per share is either holding still or going up still as these things are getting disrupted. And that- McClatchie has newspapers. Okay. It says right there on the chart. Yeah, that's wild. That's what's going to make this stuff so hard about the software companies.

It's like you look at the results right now you go, these companies are fine. They're reporting great earnings. And then this could happen. That's what's going to make this so hard. And that's why stock picking is difficult. Yeah. Because the market is obviously pricing in.

The market is saying the terminal value is RadioShack. Yeah. So every time I see RadioShack, I think that I had a friend in elementary school. And I think we were watching the movie Coming to America, something like that in New York. And there was Radio Shack on a corner, right? So on each corner, there's a Radio Shack sign, right? Radio Shack on one side, radio shack on the other. And they show it overhead.

And my friend goes, totally serious. That's really weird. Why are there two Radio Shacks in the same corner? Because each sign, you know, didn't get it. Anyway. I don't get it. It was a store on the corner. So each corner had its own sign.

Got it, got it, got it. All right. Last week I talked about interest rate concerns, okay? John Arnold, very smart. one of the best, maybe the best energy investor of all time. He's on Patrick O'Shaughnessy's podcast recently. Very smart guy. He said a fire alarm is going off and everyone is ignoring it.

And he shows the long-term bond yields, like this is a Bloomberg chart. United Kingdom, France, United States, Japan, and all these long-term bonds, 30-year bonds are going vertical. Right? We talk about this lot. People are very concerned with this. All right. I want to talk about that worry, that five-alarm fire with this email we got.

Hi, Ben. I've noticed that the yield curve is no longer inverted. I haven't heard anyone talking about this. been observed that recessions occur not when the yield curve inverse, but when it uninverts. Looks like that hasn't happened this time. Harvey's recessionary indicator has experienced his first exception. What are your thoughts? And this is what I want to point out. When the yield curve was inverted, short-term yields were higher than long-term yields. People were screaming, this is going to be a recession because this indicator

has always done that. You and I said, wait a minute, this is just the Fed jacking up short-term rates. It doesn't have to be that. We were kind of saying, let's pump the brakes on that a little bit. Now, what we've seen is a normalization. Short-term yields have been. have come down, long-term yields have gone back up. That's a normal yield curve. This is normalization. This is not a reason to freak out people. Okay? I'm throwing cold water on this all day long. This is a normal state of affairs. Long-term yields should be higher than short-term yields when you're accounting for risk because there's way more risk in a long-term bond than a short-term bond in terms of volatility and interest rate changes in inflation. And maybe, just maybe, the bond market

is saying, I think we're in a higher growth in inflationary environment. Listen to this from Warren Pyes, another fellow T-CAP person. S&P 500 forward sale of growth has projected at 18% over the next 24 months. Historically, this corresponds to 12.4% nominal GDP growth, 6% annualized. Something to consider as yields in the Fed look for new equilibrium. So he's saying, we're probably going to have higher economic growth. And what if the bond market is just telling us, you know what? That period, the last 15 years, were not normal for interest rate.

We're trying to normalize here for higher growth and higher inflation than we had in 2010. Thoughts? That makes more sense to me than the alarm situation. Yeah, totally. I also think it's weird that everyone is ignoring it. I know it's just a tweet and he doesn't mean it literally, but I feel like a lot of people are doing the opposite. I think there's actually an overwhelming amount of worry relative to the potential outcomes

about rising rates. What I would say, though, is the part of the worry that I think is valid is it's not the spread between short term and long term, which are healthy and normal. It's the speed at which these lines are all accelerating. Like, I think people worried, like, what if this doesn't slow down? It doesn't, nothing has to happen, okay? Because I was about to say it has to slow down.

It doesn't. If the long end keeps going up and we're at, I don't know, where the line is, 6%, 7%, I'm going to start to get nervous. I would very much like for this to slow down. Yeah. We're not going to get there. That's not going to happen. I don't think so either.

Time stamp, double stamp, triple stamp. Not going to happen. We'd have to be way higher growth. The thing is, here's the problem. Here's the psychology behind this, though. You can't triple stamp, but double stamp. Come on. Here's the psychology behind this, though.

Everything is happening faster. So when we have these moves, that's what freaks ever and out because people are not used to it. When inflation went from zero to nine, it freaked out because it happened fast. When oil went from $50 a barrel, negative $37 a barrel. Everyone freaked out when mortgage rates went from three to eight. This is just the markets now. People are going to have to get used to things happening faster.

And just because they happen fast doesn't mean something is breaking. This is just how markets work now. You might be right. Okay. All right. Here's the positive side. I think there's pros and cons to rising rates. Because obviously, rising rates are not good for every, like borrowing, mortgage rates are back near 7%. I don't think that's a good thing. Okay. Here's the positive behind this. Exhibitating. chart of the week from last week. Bond yields are historically linked with higher forward returns. So we're looking at the 10-year starting yield, we've talked about this before, versus the forward annualized return.

And guess what? The starting yield's a pretty good predictor of future returns for bonds. So you're getting probably 5% now in high-quality bonds. That's great. You're right. That's pretty good. That is the other side of the coin, and it's a really shiny side of the coin. Hey, we give a ton of love to chartkin Matt for making and designing these charts.

as he has earned every ounce of praise. That kid is incredible. So is Eric, founding CTO, architect of Exhibit A. So I just wanted to give Eric some love. He's the guy behind the guy. He built the architecture that allows Matt to paint. So he made the canvas, and Matt is a painter. So let's say you're right that we do have a sustained rise in rates.

So I looked at this. Like what happens if we get a sustained rise in rates? And this is the 10-year going back to 1950. And I looked at the total return for the S&P over that time frame versus the drawdown. And now the total return actually is pretty comforting. Like most of the time stocks are up in these rising rate cycles. This is every time the 10-year had a sustained rise. And-

What is this? Oh, one more. Okay, got it, got it. Okay, yep. And that also shows the drawdown. And there was a correction in every single one of these of 10% except for one time and that was 1994. And so every time this happened.

And some of these are pretty big. Yeah, it's just supposed to make me feel. better? This looks really bad. But the thing is, we're not in a sustained... Ben's like, there's nothing to worry about except for the 40% declines in stock prices. Short-term hiccup. But the thing is, is this really... Didn't we already have the sustained

rising rates? Yeah. I feel like now we've been range bound forever. Right? So the thing is, is this another... Do you have a sustained rising rates? Like you said, we have to see six or seven percent for that to be another cycle up. We already had the one cycle up. Okay, yeah, you're right. So I think we already had it in 2025.

This is another thing. from Goldman Sachs, median annual S&B 500 total return based on nominal 10-year treasury yield. And they break it down by 0 to 2%, 2 to 3, 3 to 4, all these different ranges, just 1% all up to 8 plus. And there's no discerning, there's nothing to learn here. Well, yeah, when you present the data this way, I don't love this chart. Okay. Because I do think the direction of the speed of the 10-year matters a lot. I agree with you.

Just knowing what bucket you fall into doesn't tell you anything. But I really do think there's something to the speed. I know we can't do technical analysis on interest rate charts. Is that the thing? Like, we can't do that, right? Well, no, you can. It's applied demand. If we could.

I want to see, like, every time we've hit 5%, that's been a higher range essentially, and they've rates have come right back down. People freak out, then we come down. It's happened like five times. I just want to see a sustained breakout about 5% before I start to worry. Deal? You know, yes. You know the meme where it's the musician who looks at Jennifer Aniston?

Is that, is that Iggy Pop? I can't remember. Yes. Is? Okay. So it's, it's, uh, like the five you're on the way up. Yeah. Is him and the five year on five, five percent of the way down is her. Right. Yes. So it matters where you're coming and we're going from. So last week we, last week we talked about, I just want to talk about oil prices real quick. Because this, in this, this whole geopolitical situation, because oil is back to down to like $96 a barrel. I think the high was actually when you and I were at that dinner in Miami for future proof.

I remember people, everyone around the dinner table was like a game of telephone was talking about oil prices spiking. super duper high. They got like $120 a barrel. They're up like 20% after hours or whatever. Remember that? I think that was the high. I remember very well. So I think this is another game of really smart because you listen to all the oil analysts and they're like $200 a barrel. It has to. It has to. There's no situation that doesn't happen. And then it just didn't happen. Did the market get it right from jump? Kind of. From the jump? Because I've told the story. a couple of months in what it happened. But we were at dinner and me and Dan Ives were looking on our phones.

And I said to him, Bitcoin's flat, S&Ps down like a buck 10 or something like that. The market didn't really react the way that we thought it would. And it continued to underreact. We were like, this doesn't make sense. And eventually we're like, okay, this doesn't make sense. But the market was right immediately, not overreacting. It's wild. Yes.

The good lesson is always like the market is usually smarter than smart people. which is hard to wrap your head around. Usually is the caveat there. We've done this wrap a thousand times, but it is usually the facts. Okay. I did an awesome, this is like random,

but as we get into investor behavior, which is actually shockingly blank this week. This has been one of the most popular, what's that big fat text called? Categories. Jeez, Louise, my brain. You know, something about this microphone breaks the brain. investor behavior is one of our most popular, most most, most packed, jam-packed categories of the show.

The Wall Street Journal has got to get a profile interviewing traders what they're thinking about right now. That's what they got to do. Anyway, in here, I put Brent Sullivan, who has a great substack on a lot of the mechanics of tax treatment for custom indexing and particularly long, short strategies, which are becoming a bigger and bigger part of the advisor. toolkit on talking wealth, him and I had a great conversation. So if you're an advisor and you want to check that out, I cannot recommend to show me about. There was a big piece in the Wall Street Journal on that last week. Bloomberg had a thing on tax house harvesting a couple months ago. This is something that's- I'm surprised it took so long. Yeah, it's getting big in the wealth management space, and it's going to be something you're going to be hearing about more and more as we talk about.

Okay. Let's talk about broken sentiment. So, University of Michigan Consumer Sentiment Index, at all-time lows since this index started in 1950, the lowest this has ever been. Yeah, that's kind of stupid, huh? Okay? We've been talking about this for a while. I feel like maybe we're a broken record here. The Atlantic had this piece. The vibe session is over.

The perma session is here. Why Americans are so unhappy by Annie Lowry. Now, she's trying to get to the bottom of this. Like, why are, why is sentiment so low? There's no way you could objectively look at this. Someone on Twitter last week as a young person, I couldn't tell if they were, you know, engagement farming or what, but they said, was 2008 really worse than this economy?

And again, that's probably rage baiting and engagement baiting. But I think there are some young people who truly think this is a terrible, terrible economy. And they had to see what an actual bad economy is. So here's a quote from this article. People have stopped believing that the economy can be good and have lost the willingness to admit that they are doing well. That pessimism might be harder to fix than an actual downturn. And she goes through like, why is this? Housing costs and inflation and higher cost of living and all the stuff.

that you and I've been talking about forever. But this is, this boils on to one thing, and it's the internet. This is just... No, no, no, no, no. And inflation. We've had inflation in the past. And it's the 70s inflation, my God, I did a whole chapter my book... Yeah, but the 70s inflation destroyed the country, too.

And it's worse sentiment now than it was back then. Yeah, I mean... The inflation we've had this decade is nothing compared to that. Nothing. To just say it's the internet is, come on. That's not just the internet. Okay, it's the internet and it's COVID. And then sprinkle a little inflation on top of that.

But that's, it didn't, it almost didn't matter what it was. I think everything is just amplified these days. And we had no chance. Humanity had stood no chance against social media. None. We had no chance. Well, whether you want to blame COVID or inflation, this line broke permanently after that. So the internet wasn't created in 20.

My point is, if bad stuff that happened in the past would have happened in the social media era, that's what would have amplified it. Okay. It didn't matter what it was. It was something bad always. does happen, social media made everyone's sentiment worse. And now sentiment is a broken reading for all of history. It's never coming back. Not that, now that's not going to spike in the future, but as a reliable indicator of how people are actually feeling about the economy, it's useless. You can't use it anymore. Well, but for the stock market, for sure, and for real life, too.

But it does have political, like, this is a direct line to the political landscape. It's political politics is the thing that it matters for. And that's why we're going to have, people are like, Are politics just going to go back to normal eventually? Like, will we not have this like craziness of the extremes? No, I think it's going to get weirder. Could you say that even though it being lower than it wasn't the bottom in 80 and the bottom in 2000, even though that's stupid, right? Because this metric is objectively broken, even the way that they collect the survey,

we've been over this 100 times. I still think it's directionally it's right. Like people, the mood of the country is not awesome. At the macro level, at the micro level, things are fine. And not for everybody. Believe me, I'm not suggesting that they are. But I think, like, the average person feels way better about their situation. And this is always true than how the country is doing. That's not like an insight that I just made up.

And my point is, because we are just inundated with negativity at all times, that whole thing of the country is going to hell is never going to change. That's always going to be something now. Yeah. And also, people like us just give this sort of stuff too much oxygen. Potentially. But it's a thing, obviously, right? All right. U.S. household ownership of corporate stocks and mutual funds now totals $58 trillion,

which far exceeds real estate assets totaling $48 trillion. And this is part of the, this is like part of, you know, one of the key ingredients of the pie of discontent is all this wealth is in people's faces. And if you don't have a piece of it, it feels really shitty. I also think that what we experienced in the 2020s with simultaneous booms in housing prices and stock prices, we're never going to have that again. Okay? So people are going to look at that. If they miss the boat and go, oh, my gosh.

Here's the thing, though, two-thirds of the country-owned stocks, two-thirds of the country-owned homes. Most people have financial assets. I know it's skewed. I know it's skewed. You're right. It is funny. A lot of the people that are yelling at each other about how bad things are have benefited.

And they're yelling about how bad it is for people that don't have part of it. It's like this weird, it's weird virtue signaling all over all over the internet. All right, Jeff Bezos calls for zero income taxes on bottom half of earners. I didn't read this or listen to the interview. Did you? I listened to a CNBC interview, yes. Okay. What did you?

All right. The tax nerds were running wild in this one. Okay. Somebody said it's great that Jeff Bezos thinks this way because too many people who don't make money, because too many people who don't make money think that giving money to the government will solve a lot of their problems. They think these government programs are the end. answer and it's clearly not. I would agree with that. Jeff Bezos quote tweeted and said,

thank you. The important part is zeroing out taxes on the bottom half. Best way to put money in someone's pocket is to not take it out in the first place. Bottom half is only 3% of total tax revenue, but it's very meaningful to that person, zero it out. My thoughts on this are this is a very, very complicated topic. And there's obviously very strong feelings coming from every angle here. I think that it's a really potentially scary thing and slippery slope to divide the country like that between a thing about how bad the class warfare will get. If we, if the country allows a certain portion of the population, and I'm not talking about

people giving this as I could give a shit about that. But if it's like the us versus them and you really create like a caste system of halves and halves not like formally, now yeah, I think it's, I think it'll be phenomenal. like in a vacuum to not have people pay taxes that don't contribute a damn thing. Like in a vacuum in an ideal world, yes, who says no to that? Who says no? What type of monster says no to that? But I think it has real big societal ramifications that people much more thoughtful about

this topic need to spend a long time thinking about. Yes. That's a college of mine. And you go, well, I'm in the 51st percentile. And I'm having to pay now. I moved out of the bottom. Now I'm paying. If you're close.

Yeah, yeah, yeah. So you're right. It's... There's got to be a better system. It's never going to happen to because we just keep... Everyone keeps saying taxes have to go higher, and all they do is keep going lower. They keep funding different ways to take taxes away from people. So I think we're just going to keep testing how many taxes, tax rates we can take down lower and see what happens.

That seems to be my only... This is a true rabbit hole that I care not to go down. You know what? Speaking of that, when people say I went down on rabbit hole, no, you didn't. He spent 20 minutes on Claude. True. Right now. Like there's some people, there's some people that genuinely go down rabbit holes, but

I'm going to say 90% of people are full of shit. Rabbit holes are easier now. Speaking of Claude, this is, this is fucking unbelievable. So Ben got on an email from a famous author and entire inbox. I'm like, this is so weird. Who writes this way? Like it was just, there was a line in there. There was, I'm not even sure.

It was like, I thought it was like too cheesy to be AI. But Ben's like, this is obviously AI. I'll write back, whatever. So Ben responded. And the person responded. with what was clearly an AI response. And I said to my, it's like, you gotta be fucking excuse me for the F bombs.

You gotta be kidding me. This is a very well-known person who sold millions of copies of books. And the thing is... This is how you behave? I'm about to use the FOMB again. You freaking weirdo. You think this is normal behavior?

So I... Are you a human being? So since my book was released, I probably get two or three AI emails a day from like people who want to promote the book. And I can tell because they stole the... the summary from Amazon, and it like re-summerizes the book to me, hey, you did a good job explaining this.

And then it says, would you like to join our PR department help promote your book? And I get two or three of them a day. And I can't tell you how quickly I delete an email that I know is written by AI. And I can't believe that successful people, I get it. You want to be more proficient and productive and have an AI agent help you. But it is so cringe when I see an AI email from someone. I can't. I immediately delete it.

It's unbelievable. I hope that's just something that happens. the future with people where they go, no, we're not going to give you the light of day for this. Like, you can sign off using AI somehow, like, yes or no this work. But like an actual personal email to someone using AI is no way. Sorry. It's unbelievable. So Google had a big demonstration of their new capabilities.

It's called Spark. And it's basically like the AI assistant that's coming. So Ben Thompson wrote a lot about this. And a friend of mine actually was telling us. me yesterday, he's like, dude, it's here. Like everything that we've been like waiting for to like the really like, holy effing crap moment. Like that's what this is.

I haven't used it yet. So I'm excited to take it for a drive. But this is what crypto was supposed to be. Right. Where it was like, and I don't mean the promise of a different future per se. I mean specifically like, oh, the, the, you won't even know that you're using crypto. It's just going to be in the background or all. the companies are going to start to use it.

This is what Google is now going to be pushing. And a lot of these hyperscalalers are going to be, they're just going to be integrating AI more and more. So before you get to the AI stuff. Without us even knowing it. And what's so funny? What are you laughing at? Oh, no.

We have Duncan. Duncan being cute. Duncan was trying to guess who the author was. So did crypto like miss its moment is what I want to ask? Because there was a story last week about Mark Cubans. Like, I sold my Bitcoin. Like, I'm done of this. Like, do you think that AI has just sucked all the oxygen?

and out of the room, and crypto had its moment to, like, really get a consumer use case. And all you have people say staple coins and maybe that will be integrated with AI. But crypto never had its thing. It's like, oh, my gosh, this is the thing. Yeah. And it never happened. Did it miss its moment? It's easy to say, yes.

I don't know enough about what's happening in the crypto economy to say, like, yes, it's dead forever. But the short answer is yes. Shai Ballard tweeted Robin Hood's crypto CEO is stepping down. That's a big signal is their crypto revenue growth slows. this is a gut punch or at least a jab. SEC delays plan allowing for crypto versions of U.S. stocks. So is crypto dead and buried forever? You know, I'm not going to say that.

I have no idea. I wouldn't say that, but it's missed it. Like, AI has the... The thing is, AI is sucking up all of the talent in the world. That's what I'm... Remember before it was like everyone's going to work in crypto? Now all those people have to go to AI. And that's what drives innovation.

It's the talent that builds it. Right. And who is going into crypto now? Like, nobody. If you were going to, if you're of that mind and of that spirit, you're going where the next thing is and it's clearly not crypto. Right. That's what I'm thinking.

Who knows? So Benedict Evans has his, I think he does it every six months. He updates his presentation. And this one, of course, was on AI. This was interesting. We talked about this last week. He said, everyone is already using this as the title of the presentation. He says, open AI reports 900 million plus weekly users, but only 5% of them are paying.

which is kind of nuts. So getting back to the, the crypto stuff, we were so early was the rallying cry. And it's very easy with the AI stuff that we're talking about nonstop. This is a bubble. It's got to be a bubble. Look at the numbers. These are unsustainable, the spending, blah, blah, blah, blah. But and also the reality is getting back to like the earlier conversation of headline talk versus people that actually do

the work and contextualize where we are, we are in top of the first inning, as hard as I believe. Now, the stocks might be in a bubble, right? It might be that we discounted everything. Okay, fine. I don't know. We'll find out. But in terms of AI adoption, we really are so early.

Yeah. And the use case is obvious once you start using it. So you talk about the Bezos interview on CNBC. One thing he said, he said, I'm taking the other side of the labor disruption. He said he thinks AI is going to make people so much more productive. The productivity is going to go through the roof. People are going to have more money. He said, AI is going to lead to deflation and labor shortages.

He said, we're going to have more desire for things in the future because of AI and is going to create more businesses and more jobs than ever. He's taking the positive spin on AI, which is actually kind of refreshing to hear. Someone last week commented us and said, I'm sick of all the AI doom from you guys. And I think we've been pretty fair about it all. Doom. But, yeah, I know. But Bezos says, no, no, no, it's going to leave to job shortages because people are going to be more productive and richer.

Very plausible. I hope so. All right, Ben. I bought a stock. This is definitely not financial advice. People like when Josh and I talk about stocks and what are your thoughts. So as much as I would say this is financial advice. Has anyone ever said that before?

This guy. As much as part of me. would like to never pick stocks again because it's stupid and it's a waste of time and I don't make money and blah blah blah blah I love it keeps me it keeps me young Ben um and it's it's great for the content all right so whatever I'm picking stocks again um what you buy so I bought floor and decor floor and decor is a looks like an uh an incredibly beautiful perfectly perfectly perfect downtrend the stock sucks floor and decor do you do you do you do you? Do they have one by you?

I think there's like 500 stores in the country. I mean, it sounds like a place my mom's shop at. Okay. So it's, uh, they do, they do flooring, obviously, and other home improvement stuff, okay? So they compete directly with Home Depot and Lowell. As a matter of fact, I think they sell more flooring. So I, how is this even on my radar? So Alex Morris, who I follow.

Wonderful writer, substacker. This is a bit, he's been on this beat for a long time. And, uh, I followed him right into the stock. Stock is in a 65% drawdown. So he, so he, so he, he gets a, gave me financial device. So if any, if this doesn't work out, that's on him, not me. So anyway, you know how we were talking about like how fast things change? And part of the lessons, at least from recent history, is that stocks just don't let you in. Like by the,

when the story changes, like, look at Intel or, or any of these. Like, it's like, wait, what just happened? Why is the stock up 40%? Oh, I can't buy it now. That's how it works. Okay. So I am very confident that at some point in time, there will be a changing of the housing cycle and I don't want to miss it. Okay? So this is the stock that I'm betting on. And will I sell it in three months when I get bored and I don't make money? Yeah, probably. This is your way to bet on the home renovation boom. Yeah. People not moving. Yeah. So anyhow, that's a long setup, but I thought this is interesting. So the Wall Street Journal has a piece showing the age of America's homes. and most of the homes are 55 years or older.

A lot of the houses in my town, I'm sure, in every town, when they sell, there is a lot of work that needs to be done. And flooring to court and all these other housing stocks are in an absolute ice age. This is a great depression. This is a great recession for these housing stocks. The news cannot possibly be any worse unless it just goes on longer than even the market is suggesting, which obviously is happening, right? I got, who knows?

All right. So I saw a chart from Torson Slack, who we mentioned all the time. And it says higher rates, more renovations. Locked in mortgage rates are keeping homeowners in place and driving a surge in renovation spending. See chart below. Ha ha ha ha ha. See chart below. This chart is bunk.

I actually thought about this. So wait, let me see if I can guess. God. So the reason this is bunk because it's renovations as a percentage of. construction spending. Is it because construction spending is falling? Is that why? Yeah, the denominator. Right. Nailed it. Okay. So,

Claude decoded this for me. And if you look at improvements, now this is a little bit data, the data, but it's growing like 2% a year. It's barely growing. It's barely growing. And if you look at, if you look at the comps of all these companies,

Flore and Decor, Mohawk, Sherwin, Lois, Home Depot, William Sonoma, restoration. They're all saying the same thing. We know the housing market is an absolute shit show, okay? It is terrible. Whirlpool that sells dishwashers and whatever, annihilated. There is nothing happening.

There is nothing happening. So locked in mortgarets are keeping homeowners a place and driving a surge of renovation spending. Yeah, I suppose if you're looking at a denominator as a percentage. Okay, so what's your thesis here then? You're trying to get ahead of this? Yeah. Okay.

Yeah. So I think this is actually like not like a one or two year trend. I think this is like a 15 or 20 year trend because Redfin has the data that shows like two thirds of all baby boomers have lived in their homes for 15 years or longer. And something like 40% have lived in their house for 20 years or more. A lot of those houses are going to need a ton of renovation to meet the standards of young people who grew up on HDTV. Okay. I think that's going to be a big huge thing for baby boomers have just said, you know what, I don't need I'm old. I don't need to renovate.

I'm fine with it. We did a renovation 20 years ago. We don't need to renovate again. And young people who come in to buy those houses are going to go, nope, we need to gut this, new this, new countertops, new flooring, updated bedroom, open up for entertaining, all that stuff. That's going to be a 20-year trend. But does it, is it just dribs and drabs or is it like this, you know, that's the, that's the thing. Well, higher rates are killing housing, obviously.

So I hope you're right, Ben. I hope rates come down. Floor and decor. All right. Your bottom fishing. How about this? I was listening to Matt Bellany and he had a podcast on vertical, vertical streaming because everybody holds their phone like this.

And even though it's a minor inconvenience to do this, it's an inconvenience, right? This is the natural. So Netflix is getting in on it. Like all these companies are spending big bucks to compete. Because also like Reels, And TikTok, this is how people watch it. They said this on the pod.

I had Claude confirm and make a chart. Reels alone, meta's Reels is doing more revenue. Now, they just, this is a new product. Reels is doing more revenue than Netflix. Jeez. Just Reels. This is why the concentration argument about the big tech companies is, it falls flat for me. You always talk about the business lines of Apple.

Apple does more revenue in AirPods, and you know, you always talk about that. Like, if you break down inside these companies for Instagram and you said just reels, and then YouTube for Google and YouTube TV and all these things, like, those are individual businesses of themselves. This is, that's, that's pretty crazy. The funny thing is, is that's obviously not a good way to watch something vertically. It's way to watch it horizontally, but people don't care. It's convenient.

Right? It's not the best way to watch something. know what I did for the first time. We had a four-day week weekend, as did, I'm guessing, most are all of the country. I don't know why we were off on Friday. And the weather sucked. The sun finally came out on Monday afternoon, but it was a complete washout here. I took the boys to see the mandoamandoam and Grogo.

I sat in the seventh row of the IMAX theater. People liked the TV show, right? I watched one episode. I'm like, I'm not going to watch Star Wars show, sorry. I watched the first season. It was good. Yeah, I think people are into it. But sitting up front in Ivax wasn't as bad as I thought it was.

It was an neat experience. You didn't put your neck straight up? No, no. I was afraid of that. No, it was not bad. The movie was, so it did good business. I think it did 160 million globally. Not terrible.

And it was totally watchable. Kids loved it. Matt Bell and he had a stat like, I think it was like 7. 70% of all tickets were sold before 5 p.m. It was like a heavy, a heavy kids audience. Now, I don't watch Mando, so I don't know if this is an extension of the show. I'm guessing it is.

It just was like, why, you know? Like, it was just... That's what I was going to say. Why do we need this? Yeah, it was, the movie was like, fine. It was watchable was I didn't fall asleep. Actually, I did once. But it just didn't move the plot forward.

Like, this is the best they got. It's been seven years. John Favro, it's been seven years since we've had a Star Wars movie. And this was it. It was just like, it was just felt like, like Marvel did this shit and got it out of the system.

Like, it's over. We're not doing these movies anymore. But I guess we're still doing them. It was kind of depressing. Disney's going to squeeze the last bit of that toothpaste tube for as long as they can. Yes, they are, Ben. Nobody's buying dad books, Ben.

What is that? Dad books like World War II? Biographies. So, Charnow's most recent biography of Mark Twain. which was published in time for Father's Day, 2025, has sold $119,000 hardcover copies to date. Ulysses, which I read in 2017, sold $381,000.

Speaking of dad books. So, wait, they need to, it's because these biographies are too long. No one has time to read 900 pages on someone's third cousin. Sorry. Nobody. Too much. I always struggle. I'm not a big gift giver.

I'm a bad gift giver. I'm not a big gift giver, but I love giving gifts. I just don't know how to do it great. As an anti-birthday guy, I'm obviously not good at it. Okay. So in a period of being unlocked from this brick on Instagram, speaking of dad books, I bought my dad a book. And this is Reels, right?

Like, this is Reels monetization. I bought my dad a book where it's like the first time you did this, like the shit that I don't know that I would love to know when he's not here one day, hopefully far into the future. and he'll be able to fill it on and give it to me. I've heard about that. You interview your parents essentially, right? Yeah, so it's like that, but it's just done for you. My dad just has to fill it out.

So I'm excited. Yeah. A lot of the stuff you've literally never asked before. Yeah. And it's good for your kids too. And things that are like, you know, uncomfortable that you probably would regret not asking, not having asked before, you know, when it's too late.

Yes. You know, I had an uncomfortable with my conversation with my dad about six months ago. And I said, give me all your stuff. My dad's going to be 80 next year. I said, give me all your stuff. I need to know where your accounts are. I need to know your passwords. I need to know your insurance. I need a mortgage stuff. I need everything. Put it in one place for me. If something

happens to you, I need that. I'm, you know, I don't want to have to, like, go digging and looking for stuff. Did he do it? He did it. And he's an old school guy. He, um, he handed to be handwritten on a piece of paper. Not, not, not. I went home. I'm bad. I keep giving my dad crap on the show. I went home last week. And we're, we were a big card playing family. We love playing cards. My little playing cards, so we're playing cards. We're like listening to music and playing cars, having a beer. And my dad comes out with a sheet of paper with stuff written on it. And he says, Alexa, play Beatles hard days night. He wrote out his playlist. And he's, after every song was over, he'd tell Alexa to play the next song. I said,

Dad, can I show you how to create a playlist? He said, no, I don't want to do, I'm just going to, I have my playlist here. I'm going to, all right, so every song, he'd have to tell Alexa what to play. My uncle is cut from the same cloth. He's uses, and I think it's a joke at this point, but like he would do it even if it wasn't a joke. He uses week at a glance, which is the physical calendar. It's like a pocket size calendar. Oh, yes. It's always in his pocket.

Right. That's how he, and he has an iPhone, but he literally uses week at a glance. That's funny. And I know he used to print out his portfolio every single day. And, you know, some people are just, uh, Stuck in their ways. There you go. That's right, Ben.

All right, I wanted to ask you about this. So this article is not for me, but it's for you. The ice cold civil war between Diet Coke and Coke Zero drinkers. So I'm not a huge Diet Coke drinker. I try not to drink a ton of soda, but I drink it more than I would. You know, I probably have three cans a month-ish, ebbs and flows. Sometimes I drink it, sometimes I don't. I've never had Coke Zero.

Oh, my gosh. I used to be a Diet Coke Diet Pepsi drinker. I go back and forth. Coke Zero and Pepsi Zero are so much better than Diet Coke or Diet Pepsi. In what way? The flavor. It tastes close to the regular versions. It's so much better.

It's hard to explain. So I can see why the growth is happening in those zero drinks. It tastes a lot better. So Diet Coke sales increased by just 1.3% in the first nine months of 2025. Coke zero grew by 4.8% of the same time period. I'm a big zero guy. I love it.

That's all I drink now. This is zero stuff. I'll try it. It's good. My interest is peaked. All right. Retach retied. I don't know if I'm saying that right.

But that's the new shit, the new hot shit from Eli Lilly. Phase 3 obesity trial just came out and the results are genuinely insane. 28.3% body weight loss on 12 milligrams over 80 weeks. I don't know how much 12 milligrams is. 70 pounds on average. 70 pounds. Man, people are heavy. 45% of patients had 30% weight loss.

This is bariatric surgery territory. We've solved weight loss. What does this mean for the health of this country? We've literally got doctors should be handing this out to every patient who has a BMI over X or a like the savings on heart disease and it's unbelievable. So I just said, yeah, like yeah, they should do it. I literally know nothing about medicine. I'm the last person that should be giving medical advice. I have, I am like a hypochondriac about death because my mom died young.

I think about death a lot. And I just think that I'm going to die young, which is not the greatest feeling in the world. So I did a blood test. There's a company called Function Health that I found through somebody substack that I like. And I said, you know what? This is probably overdue for me. So I got like 96 different blood tests. And I signed up like the cancer, the pre-crancer screening, the heart stuff.

And it's not cheap. It's like, it was like 14 or 1500 bucks. Certainly cheaper than dying. Or like there's no amount of money I wouldn't pay to know that to know that I'm either whatever on the right track or not or if I need to course correct. I hate giving blood. Not a fan. It was 12 vials. Not fun.

Do you get like squeamish about it? Not really. I just don't like it. But it was it was over fairly quickly. Anyhow, um, so I got the results and my biological age, Ben, would you like to take a guess? 40. 30.8. Okay. My, no, my, my biological back age is 75. True. But 30.8 made me feel pretty, pretty good.

There was like, there was four things that were like on the upper range of borderline, like, borderline out of range. And it was like... So this is like... And it was like diet stuff, stuff that you control. But I shouldn't expect the football just yet. In fact, I probably shouldn't even be mentioned in this because I haven't gotten the results for like the pre-cancer stuff,

which is the stuff that is especially like prevalent to my family. And do you have to do this like once a year now? It's a good question. That I don't know. Okay. So if you take your internal clock versus your hairline, average it out, you're right at where you should be. Right? That was a positive surprise.

I feel pretty good about that. All right, recommendations. Ben, I took your advice and I listened to the Harrison Ford podcast, which, speaking of genetics, his mother was Jewish. I had no idea. One of us. Great pod. You know what kind of annoys me?

Not kind of. It annoys me. For whatever reason, on Spotify, there was no video for this. And it's not, there's some, are they on Netflix? Oh, maybe. I don't know. That's a good question. I don't know.

I saw, there's a video version on YouTube. Okay. So, what a dude? It's great. So I, after listening to the podcast, I said, you know what? I watched the first season of shrinking. It was a show I liked I didn't love. I need it as a background show.

And I realized maybe I already made this observation. Bill Lawrence is the Taylor Sheridan of comedies. So he's got shrinking, Bad Monkey, Rooster, Ted Lasso. He did the Scrubs remake. Wait, which was Bad Monkey? The Vince Vaughn one. Oh, I didn't watch that.

No, none of them are great. They're all good, though. Yeah. Like, there's no comedies anymore. So it's nice to just have, it's a background show. You don't have to, like, pay attention to every scene. So I put it in the background while I'm doing stuff at night, emails and catching up on stuff.

It is a good background show. Oh, Obsession, which is a hardcore Michael movie. I haven't seen it yet. You might have heard about this. Ben, have you heard about this yet? No. It's one of those indie horror movies. It's on fire.

Okay. I think it passed 100 million out of the box up. or it's going to. Movies are, what, you have seen it? I know it's a trailer for it. I'm not going to watch horror movies.

You know that. I know you don't. Movies are having a moment. So much so that one of the stocks that I've owned for a long time in Michael years is IMAX. There was reports that IMAX might be getting some offers.

We got a lot of congratulations. Are you going to sell it? Are you going to wait? I'm not selling it. You're going to wait? I'm not selling it. Okay. I actually took your recommendation for a movie. My wife and I watched remarkably bright creatures this week on a Netflix. That's a Ben Carlson movie. It's so nice to have just a sweet

movie. That's the best way I can describe it. It was sweet. It had like no ulterior motives, no like cynicism, just like a nice movie. Like it was kind of surprising because it was a lot of ways. I feel like I got a little like, whoa, a little chucked up maybe. Sally Field still has it. Like I haven't seen her in something in forever. She's still got it. And I love Bill Pullman's son. I love him. He's. He was in Top Gun Maverick. He was in the show with Brue Larson on Apple. I think he's going to be a great character actor.

He's, he looks different in everything he does. He's like, Sally Field, like, still has it. Yeah, it's just a nice movie. It's a nice movie. Like, didn't have any, like, yeah, any other agendas besides just being a nice, sweet movie. I really liked it. It was pretty good one for Netflix.

Really good for Netflix, yeah. All right, I believe that's it. Sun is shining. that's good. This guy hasn't been falling for a while as far as the markets go. Someone said that I'm like the dad when I say, like, whenever we do get a correction, I'm going to walk out like after it rains and said, ah, we need that. That's going to meet after correction.

We just came out of a correction. But I agree. We do need one. I'm with you, Ben. 9% is nothing. All right. Animal spirits at the compound news.com. Personally, most personal responses.

See you next time.