Animal Spirits Podcast - Are Bonds Competition For Stocks (EP.297)

Episode Date: March 1, 2023

On today's show we discuss Michael's trip to Disney, the economy is too hot to not go into a recession, why inflation remains elevated, the junk stock rally, why housing prices aren't falling faster, an appreciation for streaming and much more.   Find complete shownotes on our blogs...  Ben Carlson’s A Wealth of Common Sense  Michael Batnick’s The Irrelevant Investor  Like us on Facebook  And feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation.      (Wealthcast Media, an affiliate of Ritholtz Wealth Management, received compensation from the sponsor of this advertisement. 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. 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.)  Learn more about your ad choices. Visit megaphone.fm/adchoices

Today's Animal Spirits is brought to you by our friends at Y Charts. Michael, when I go on Y charts, I have my templates all set up. And the first one I see now, because I'm interested in the stuff, is real estate. And click on it. And also, it shows you the kind of news releases of the day for real estate, what the different rates are, all that stuff. And the one I came up today was Case Schiller National Home Price Index has been updated through the end of December. So it does not include my neighbor selling his house. All right, go on. It might change things. So it is showing off the highs. The data, it was back like 35 years or so. And we're now 2.7% off the highs for housing prices,

which is actually the second largest. Yes, through December. It's not that much. So this is national housing prices from the top. I guess if you wanted to include inflation, I'd be a little lower. The funny thing is you can also look at national year over year. So you can look at both ways, just the drawdown. You can look at the gains. We're still on a year over year basis. Home prices were up 5.8% last year. Actually, you know what? We had a bet on this, didn't we? Home price gains for the year, someone's going to remind us of this. I feel like we did a bet on this.

Home price is being up 5% or more. Let's pretend. Okay. Pretty sure whatever happened, I won. Okay. Anyway, you would hope that this would get a little better. We're going to talk about why the losses aren't larger on today's show. If you want to learn more about finding these charts,

all the other charts and white charts, go to whitecharts.com, tell my Animal Spirits sent you, and get 20% off that first subscription. Welcome to Animal Spirits, a show about markets, life and investing. Join Michael Batnik and Ben Carlson as they talk about what they're reading, writing, and watching. Michael Battenick and Ben Carlson work for Ritt Holt's wealth management. All opinions expressed by Michael and Ben or any podcast guests are solely their own opinions and do not reflect the opinion of Ritt Holt's wealth management. This podcast is for informational

purposes only and should not be relied upon for investment decisions. Clients of Ritthold's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits. with Michael and Ben. I want to start by acknowledging an anniversary. Ben, you've been blocking for 10 years. Is that real? It's hard to believe, yes. I had this marked on my calendar some reason. So it was February of 2013 I started. Was it WordPress? Yeah. There was no sub-sac at the time. I don't think medium even existed. I had to basically build a website myself. I had help from some dude who was in my MBA class who said he could build websites. And I stole a header from something else and did a picture and off we go.

Where'd the name come from? I don't think I ever asked you that. My brother and I always talked about people making mistakes with their finances. And we always thought like just, yeah, it's true. But we'd always say like, just use a little common sense. And so common sense was always the name that I was thinking about. I honestly don't know. I came up with it on my own.

I tried 50 different variations and that's the one that I figured. And credit to me for not spelling sense, C-E-N-T-S. Because people in personal finance sometimes will do that. And credit to me for not doing that. Wait, was your first post the one that you sent to Josh? No, no, no. No one read any of my stuff for a year, probably. What was your very first blog post?

I don't even know. Someone sent it to me, actually. It was kind of laying out what the blog was supposed to be. And honestly, when I started it, I figured I would make it like six months. I wrote out a list before I started. I'm going to blog about these 50 things. And I assumed I'll get through that list and then I'll run out of stuff to say. And that'll be that.

And I'll have this just sitting there if anyone ever wants to read it. That's kind of what I figured when I started this. And you were working at the endowment at the time? I was working at the endowment. I think I honestly was just getting a little bored. It was a good job and it was secure and it was interesting. But I'd been there for going on seven or eight years. I wanted to try something else.

And so blogging was my way of, all right, I need to do something here. So you wrote a great post, some of their biggest takeaways. If you had to pick one, what do you think is the biggest lesson that you've taken away? I think the biggest one, if we're talking about people in finance, is just putting stuff into plain English. That's the thing that really surprised me. I was working in the institutional field, and I thought everything there was so complicated. And my whole ethos was born on, like, investing is not easy, but you don't have to make it hard. You don't have to make it so complicated that people can understand it.

And so the idea of putting stuff into plain English, I thought made sense. And the most surprising thing to me was, after six or 12 months of writing, my biggest audience was financial advisors. and they were emailing me and saying, hey, can I share your post with my clients? And I was not in the financial wealth management industry at that time. I was working with institutions. And it kind of like a lay-bob owner for me, like, oh, people could actually use this stuff. I was just trying to explain it to friends and family. And people in the industry thought that that was actually useful.

And that to me, I didn't even realize at the time, like, oh, this actually could be useful. Communicating their clients in plain English makes a lot of sense because they don't pay attention to this stuff as much as we do. Well, congratulations on 10 years. It's pretty incredible that you're still pumping them out at the page. which you are. I feel like you're only getting started. It feels like you're like ramping up. We'll see. It's one of those things that's just become part of my routine. I get a lot of like personal satisfaction of putting my thoughts out there for myself just to like organize what I'm thinking. Well, I have not been blogging much these days. I think doing four podcasts a week.

I feel like I say most of what I need to say on audio. But I did write a blog post while I was in Disney. Credit to me. That's work-life balance right there. Maybe this is a good segue to start the show. The TLDR of what I wrote is maybe a paradox that the economy is too strong to avoid a recession. So as listeners know, we were away last week, but prior to that, one of the themes on the show has been the resilience of the stock market. And it was really a narrative shift from avoiding a recession to the soft landing, to no landing, to, oh, wait a minute, wait a minute. Things are accelerating. Stop, stop, stop. And so now we're at the point where the market expectations have shifted to the Fed has to maybe do more

because the economy just is not relenting. And in some areas, it's accelerating. And so therefore, we are going to go into a recession. It felt like we had a little three to four week window there where inflation was coming down and it felt like, okay, we're almost ready to claim victory here. We're going to do this. It's going to be smooth. And now it's instead of, people thinking we're going to overshoot to the underside and things are going to slow considerably and that's going to be the problem. The economy is stronger than people realize. All it took was mortgage rates going from 7% to 6% for the housing industry activity to pick up a little bit. And people are still spending. And I don't know that anyone would have said a year ago,

the problem in February or March of 2023 is the economy is going to be too strong. And that's going to be the problem for the Fed. And that feels like where we're at, things are just not letting up. Is the Fed going to panic? Is something that investors are asking themselves? But we did say a couple of weeks ago that if inflation has peaked, it's not going to be a straight line down. That wasn't the case in the 80s. It wasn't straight down. So there's going to be some fits and starts. And obviously, we'll see where this thing goes. But the market is not necessarily expecting the Fed to panic. So a month ago, if you're looking at the CMA Fed Watch tool, which gives you market expectations of where Fed fund rates are going to be, a month ago, there was a

0.3% implied probability of a 50 basis point rate hike. It was 18% a week ago, and now it's up to 27%. So still 73% probability of just a 25. But now there's a question is the Fed going to maybe overcorrect. I'm going to jump down to the inflation thing here. We'll come back to the market stuff. Did you read the latest Matt Klein one last week on inflation? I did not. He's been one of these people that saying a lot of this stuff has really just been pandemic stuff. And once that comes off, but it's probably going to get back to normal. And he's saying all the data is showing that it's probably not going to do it. And his whole not going to get back to their 2% target on its own. And he says the good news is that the humming economy continues to provide more opportunities

for more people to produce more of the things that we need to want. The bad news is it seems increasingly unlikely that America will return to the pre-pendemic inflation rates without a downturn. Here's one for me that maybe you can back up with some Disney stuff. This was an interesting one from his beat. Just anecdotally, the 7% surge in spending at bars and restaurants not adjusted for inflation is the largest single one month increase in that category since mass vaccination began in March 2021. This is one of the interesting things to me about inflation is that you would assume inflation and price rises would cause people to change their habits. When I go to a restaurant now, I notice that it's way more expensive. And I have a family of five, so that's part of it.

But the bills at restaurants now for me are noticeably higher. But all of them are packed. And it's not like anyone is saying, geez, these restaurant prices are so much higher. Maybe I should just eat at home and not do this anymore. And no one seems to be doing that. No one seems to be changing their behavior because of inflation. Well, so the impetus for my blog post was seeing the line at Magic Kingdom. It was madness. And to your point about things getting more expensive when people not changing their behavior, we're going to get into this stuff later. I'm guessing for a family of four, it's the neighborhood of $10,000. It's not an insignificant amount of money to take your family to Disney. There was one point where we bought

the pool and there was like an ice cream dip in dot type of thing and on the label said five dollars guess what they charged me seven did i say wait it but that's over the line no i just i paid seven bucks i think i said this one out to disney do you look around and go how is everyone affording this how are these thousands and thousands of people all affording a ten thousand dollar or whatever the bill is when you come down to that is it just is everyone just taking out credit cards to pay for this stuff? Everyone's still employed. I guess that's it. It's kind of like, yes, I'll spend the money now and I'll make it up for it in wages. I guess that's the hard part. So back to markets and then we'll filter through the economy and inflation stuff. So Michael Sembalest, who does probably one of

my favorites. Yeah, it's one of my favorites. Did this great post as he always does. You can listen to his posts in podcast form now. I'm a reader. Okay. Especially there's charts. I guess he does a lot the charts, yeah. He said, what kind of rally is this? And there's charts. This chart shows low quality stocks and high short interest stocks. And Ben, I feel like one of us called this. No, no, no, no, no. You're poo-pooing it. I know. I maintain that the rally that we saw, I'm just giving you the facts via Michael Sainbelass. These are just the facts. So what do you have to say for yourself? I said every time we have this happen coming from a bare market, the first stocks to lead the charge are highly shorted stocks and low-quality stocks.

It's always a junk stock rally. I guess we'll see. Here's one I wanted to ask you. I've got a few questions to ask you on this show today. Oh, question. Okay. All right. I was looking at this other day.

What's your best guess for annualized returns in the SP 500 this decade? So starting in January 2020, what are the annualized returns? So from 10 to 20? No, from the beginning. So we're three years in, basically. Oh, uh-oh. What are the annualized returns this decade? 20 and 21 were monster years.

And then 2022 was awful. So 8%? 11%? I don't know. 8.5%. We're basically average. It's crazy to think we've had... Yeah, how are the last three years?

Yeah, average. If you take the boom and the bust, put them together, we have average, basically. That's kind of what happens. All right, good one from... Wait. What? Any more trivia? That was fun.

I got more to come. Don't worry. It's in the diet. Let's do this tweet here, and then I got another trivia question for you. You do the tweet, and I'll... Come on the trivia. All right. Katie Greifeld tweeted that the six-month T bill is yielding 4.99%.

The S&P 500 earnings yield is 5.06%, implying that stocks are expensive relative to bonds or cash. It's the narrowest spread since 2001. All right. I did some work on this because you and I have been talking for a while and I was saying, geez, these short-term rates are so high. Will that cause allocators to change the way that they allocate money? Will that impact risk assets?

Well, it starts trickling down to short-term rates. So I looked at the history of T-Bill rates, and the Federal Reserve has this data going back to 1934. If you want to check out further from me, I do a plug here. I did a little blog post on this, too, but I'm just going to tease some of the years. Where can people find that? Where can people find your blog? Something common sense. Three-month T-bill rates from 1934 to 2023.

70% of the time, it's below 5%. So right now, we're in the upper echelon of yields for short-term T-Bels. 61% of the time is below 4%. So 30% of all years since 1934 have experienced a three-month T-bill, I looked at the averages per year. How often does it average 5% or more per year that's happened in 30% of the time? What do you think the annual returns are in those years, and it's 25 out of 89 years that we average 5% or more on short-term T-bills? What was the annualized return for stocks in that period in those periods? Well, was one of those decades of the 80s, which were very strong for stocks?

I'm not going to give you any more context. I'm just asking, what's the annualized return when T-bill yields have been, 5% or above. Okay. Average. Let's go with average. Eight and a half percent. Above average, 11% per year.

And times when... Like, why? Is there anything in the data that's like a big outlier? It's because it happened to the 70s, 80s, and 90s. So it's bad in the 70s, good in the 80s and 90s. Okay. The highest average yields for 10-year treasuries and T-bills is in 1980s, but it was falling.

That number surprised me. I would have assumed... Now, I guess you would think, okay, stocks are long-duration assets. T-bills are short-duration assets. and maybe one of the reasons people take a little more risk when T bill yields are high is because inflation's high and they think they need to get even more bang for their buck to beat inflation. How's that?

That drives, but we know it's not the number, it's the direction. So I would bet you, because just because we did this work on inflation, that when interest rates are rising year over year, stock returns are way below average. Ocontrere, I looked at this. I look at the monthly and annual returns and rising or falling yields, the returns are basically identical. I looked at even monthly returns. If T bill yields are rising or

falling, the average monthly return was basically identical, like 1.3%. It's more, again, rising and falling inflation that matters more than rising and falling rate. So I would say... I guess I thought they were the same thing. Surprisingly not. So I would say inflation is probably going to be more important than interest rates this year if we go based on history. I like you would have thought in theory, if rates are higher, that makes sense. But I think investors care more about inflation than they do about rates, which seems surprising if you're thinking in terms of like textbook knowledge. Huh.

This next chart, did you put that in there or did I? I think you did. We both probably read this from Jeremy Schwartz. So let's skip this one. Let's just look at the next one. So Jeremy Schwartz did some work and said, actually, the real way to compare stocks versus bonds is not to use the earnings yield versus the nominal interest rate because stocks are a real asset that's a nominal yield.

So instead compare the earnings yield versus the real rate using tips. And if you do it that way, actually, we're right in line with historical average. So Jeremy agrees with me. Inflation matters more than nominal yields. Yeah, but I don't know if investors mentally adjust for real rates or if they just see the headline and say, I just want bonds. I don't know. I think this is, it's too big of a question.

I mean, certainly, certainly it would stand to reason that interest rates risk rate for six months annualized at five percent has to be competition for stocks. How could it be otherwise? Yes. And then the counter from someone would be, well, yes, nominal T bill yields are five, but inflation is still six. So why wouldn't I go for nine in stocks or 10? That's the rub, I guess. But I don't see how you couldn't look at five percent nominal yields and be pretty happy about that with the assumption that inflation is going to fall at some point. And then I guess at that point yield fall as well. So that, here's your paradox. If inflation does go back to two or three percent, guess what, we're not going to have five percent short-term rates anymore. I guess enjoy them

while they're here and forget about inflation if you can. Just push it out of your mind. It's not here. Don't worry about it. I guess. This is a true story. It happened right here in my town. One night, 17 kids woke up, got out of bed, walked into the dark, and they never came back. I'm the director of Barbarian A lot of people die in a lot of weird ways You're not going to find it in the news Because the police covered everything all up On August days

This is where the story really starts Weapons I love to see the annualized inflation rate From when I went last year to you this year For Disney It's probably got to be 15%. They can name their price And it doesn't matter, people will pay it

I think a daily pass is like 165 which doesn't even scratch the surface when you put all the extras on top of it. You know, not everything was so expensive at Disney. I mean, certain things were certainly, but like a bottle of water. Guess how much a bottle of water was? Desani, by the way.

Three bucks? $4.75. It's not terrible. It's ridiculous, but it's not egregious. I go to NASA Coliseum for the monster truck thing and water's like $7. We were traveling at an airport and we were at Panera

and my kids grabbed Fiji waters and just opened them. I'm like, no, no, no, no. Because it was like $9. Right? My son just opens it immediately before I even pay. Credit to Robin, she shipped snacks, like fruit snacks, goldfish, all the junk that the kids eat, and bottles of water to our hotel. Oh, that's a good idea.

Not to be frugal, but just because we needed snacks. Why not get bottles of water? Disney charged us a $30 handling fee to receive the package, which as a customer, I was annoyed, but as a shareholder, I like that. If I'm paying that, I want Mickey Mouse delivering that water to my money. room. All right. So Paul Godroski tweeted, I haven't seen the data put this way. And the state changed daily rent retail investors net inflows into the U.S. markets is startling. It trundled along. Trundled. That's a new word to me. Yeah, never heard of it. It trundled along at around $300 billion and people got bored in the pandemic and daily inflows quadrupled. And we've never come back

down. I was definitely saying that investors, if you come into the market as a gambler, you don't become unaddicted because it's on your phone. Right now, Robin and Activity would suggest otherwise, but what do we make of this? They're not leaving. I'm shocked that 2022 didn't see this crash. And I see a lot of people say this bear market can't be fully over until all of these investors capitually. What if they just don't? They're not going to just go away for good.

You put money on Fandual. You gamble that money until your Fandual account is zeroed out. And then you probably go back again, just like the blackjack table. Guilty. You don't stop gambling because you lost your first five hands in blackjack. You go to the ATM and you come back and play again. That's what I do. Every time my account goes to zero and fan deal, I just re-up. And I think that's probably what's going on here. And I will say, this surprises me. Because it wasn't just that 2022 was a bad year. It's that it was an awful year. The stuff that people speculated on had a depression, basically. All these stocks were down 70, 80 percent. Crypto crashed. All their SPACs crashed. I options that they were putting on did horribly. So the resilience here does surprise me. Yes. Getting back to the economy, Stephen Geiger tweeted from the Cleveland Fed, quote, a deep recession

would be necessary to achieve the 2.1% inflation projection. That's basically the TLDR. Why are they so hung up on the 2%? I honestly don't know because- Why not move the goalposts? We had 2% inflation in the 2010s and no one was happy. What's wrong with 3% to 4%. I know they they probably say, well, we can't say that because that ruins our reputation. But all the stuff that people complain about in the 2010s, we have now. We have higher growth. We have higher interest rates for savers. We have low unemployment rate. We have plenty of job openings. We're not complaining about 0% rates from the Fed anymore. Wage growth, especially at the lower end, is higher. Yes, we have inflation. That's the tradeoff. But if we just say, okay, fine, three or four percent

instead of 2%, and we don't have to go through this deeper session to get there, isn't that a good trade-off? Yeah, but I do think that there's a meta-game going on where I think, if I had to guess, they're less worried about their credibility and more worried about the market's reaction to them saying, you know what, we're going to go to three to four. They can't say that. Because if that happens and then financial conditions ease and loosen, then it just defeats the whole purpose of what they're trying to do in the first place. Yeah, unfortunately. All right, this is interesting from bespoke. Natural gas prices are down by a record 79% of the last six months. There's no analog to the magnitude of the current decline as the largest six-month decline prior to this one with

68 percent. Unbelievable. I looked the other day. We came up on the one-year anniversary of the war in Ukraine, which is mind-boggling to think about that, it's still going on. And commodities, I looked at a bunch of different commodity indexes. There's five or six of them if you want to look. They're all down since the start of the war. So we had the initial spike, and commodities have round-tripped in our down a year later after the war started. Pretty incredible. Things you wouldn't have predicted at the time. All right, here's another good one from the Wall Street Journal. This one was flying around social media this week. Part of rents fell in every major metropolitan an area in the U.S. over the past six months through January,

a trend that is poised to continue because we had the biggest deliver of new apartments in nearly four decades slated for this year. Three and a half percent lower, according to apartment list, nearly half a million new apartments are coming online this year as developers seek to cash in and higher rents that tenants have been paying. Who would have thought if you actually build more housing that prices would come down?

This is what we need in the regular housing market. Guess what happens? Housing becomes more affordable if they build more houses. So why is this happening in apartments and not single-family homes? Is it just because apartments are more economical for them to develop and they make more money on them? Well, did you, we're going to get to Conor's Sense piece later about home builders actually being the only game in town because existing homes are basically frozen. People can't afford to move. If you're locked in at a three and a half percent mortgage, you're not going up to

seven. That is kind of a funny way to think about it. The way that you said that, you think as a home buyer, you can't afford to buy, but as a home seller, you can't afford to sell. You putting yourself into a worst financial position by moving. You would simply think, just if you knew nothing, you would say, all right, mortgage rates are at 7 percent, what are homebuilders doing? You would say, they're getting crushed. All contrary, my friend. I'm looking at Pulte. I slipped down in. That was like, I just inceptioned that phrase to you today. What, which one? Oh, Contrere. I said it earlier. See, I intercepted it into your brain. I just leo DiCaprio to you and intercepted it into your brain. You know what? This is a great time to address the fact that the Wall Street Journal intercepted rich

session into your brain. So Ben, here, let me lay this out. So a couple weeks ago, Ben, like, made this proclamation that he's going to coin it. You know what? It's a rich session. The Wall Street Journal wrote about it last week, and we got a lot of emailers saying, hey, they stole your rich session. Actually, it turns out that Ben probably, and I'm going to give you the benefit of the doubt and say inadvertently stole it from them because they actually said rich session back in January, early January. So you stole it from them. Unknowingly. I'm going to leave this one up to Great Mind's thing alike because it's not. not like it's that original rich session, but the Wall Street Journal, they scooped me on it.

What do you mean they scooped you? They beat me. Oh, oh. They got me. I'm going to say that you saw the article, because you're a Wall Street Journal subscriber, as I am I. You probably saw it and planted. It's okay.

It happens. I thought about that on the fly on the show. I'm leaving that up into great minds think alike. You think you thought about it on the fly. That's the whole thing. Just like you saying, oh, contrary right now. I don't even remember you saying that, but yeah, you did it. But anyway, the stocks of these home builders look phenomenal.

because, again, the only option is new construction. Yeah, we're going to get into that. I think if I was in the market for a new home and I could afford it, I would build now rather than buy existing. I think you're going to get a better deal. So, Ben, you said, like, is one of the big takeaways that really, you said, my biggest takeaway from this experience, there's still so much we don't know about how economic relationships work.

I think that's probably partially true, more than partially. Certainly, there's a lot of truth in there. but I still think that the pandemic and its aftermath just twisted everything that we thought we knew into a pretzel. The biggest one is inflation because that one goes even pre-pendemic because the Fed was trying to get inflation higher in the 2010s and they couldn't do it. It took the pandemic to get inflation higher. And I know everyone wants to blame the Fed and they were late and all this stuff.

But it's obviously fiscal policy matters more than monetary policy when it comes to inflation. Manufacturing a recession or inflation upwards or downwards with monetary policy. probably doesn't work. Who knew that all you had to do was send out $6 trillion. That'll do it. But we started this show saying that the housing market is down 2.7%. If you would have said interest rates are going to go to 7% and stay there between above 6% for, I don't know, it's probably been nine months now.

Wouldn't you even assume the housing market would have crashed or come down 10% in a hurry and it's sticking? In certain cities it is. I just think that those levers, if we're in an economics class, you pull a lever and this thing goes up. You push this and this thing goes down. It doesn't work like that. Allison Schrager wrote a post. There's no going back to the old normal. And she hit on this. I want to read this from her. Allison says, it somehow became conventional wisdom that an aging population put downward pressure on interest rates. Yes, this is me now. That was sort of the

narrative. She says, the thinking went that older people facing a longer life expectancy save more and invest in bonds, increasing the stock of saving money, meaning naturally lower interest rates. But this never sounded quite right to me. Haven't we understand. saved, and aren't we probably going to have to go into debt to pay for our aging populations? Additionally, as people age, they need to spend their savings, which means more bonds and less demand for them, increasing rates. Then the explanation goes, there are younger countries who will buy our debt, but this all sounds sort of desperate to me.

The story now states that older people are unproductive, which will lower the marginal product of capital, another way of saying interest rates. However, that assumes there will be no new technology. I think rates fell and kept falling, and we needed a reason why. It just so happened that growth fell and the population aged, bringing this all together into a neat little story that infected every international organization and justified spending forever more. I think there's a lot of truth in there. That makes sense. I always thought that the idea that as societies become wealthier, their natural interest rate should go down

because the economy matures. That was a William Bernstein point in his book, The Birth of Plenty, like how capitalism was born. He said, historically, that happens to almost every society. You start really high interest rates. And as you become wealthier, more mature, they go down. That always made more sense to me than demographics, but that's a pretty good debunking right there. There was an article from the Federal Reserve Bank of St. Louis, title is a tightening

monetary policy and patterns of consumption. And they say, the theory suggests that consumption should behave during periods of tightening monetary policy is not clearly observed in at least two of the first four tightening episodes in our analysis. So, Ben, you asked earlier,

why aren't people responding? to different Fed policy, inflation, and maybe it's just not that simple. Maybe it happens on a really long leg, or maybe it just doesn't happen at all. And maybe sometimes it does and sometimes it doesn't for reasons that we just can't know. I also think there's a big thing to this, the fact that I wrote a piece about this last week that 70% of the debt in this country is mortgage-related debt. And if you can lock that debt in at 3%, taking marginally higher rates and other stuff like credit cards and auto loans and all these things, is not going to feel that bad because you have this one huge chunk over here, your biggest spending category locked in. If you have that locked in at 3%,

eh, who cares if I take a 6% loan out in my HELOC? I got this other piece locked in at 3. So to the point about a lot of the debt being fixed, Seveda Supermanian from Bank of America said the average maturity of bonds issued by S&P 500 companies is 11 years. Look at this. Long-term fixed, 78% of all outstanding debt of the S&P 500. So you say, oh my God, rising interest rates are going to crush corporations. Well, yeah, listen, if you've got floating rate or your lower credit quality, absolutely. You are smithereens. This other chart here, interest as a percent of sales. Look at how low that is. So this is from S&P or standard impores. And again, as Ben just mentioned, this shows the interest as a percentage of sales for the S&P 500,

and it's never been lower. Why? Companies gorged in 2020, 2021 in particular of lower interest rates. So they're good. I know people like to say that like all companies are dumb and CEOs are dumb. I could do this better than them. The old Buffett line was always don't try to take out debt when you need it. Take it out when it's cheap. And companies did that.

This was smart. This was like good capital allocation. By the way, is it a good thing or a bad thing that I didn't read the Buffett letter this year? And I don't care that much anymore. That's okay. Is that a good thing or a bad thing? I read a few quotes on people posted on Twitter. I feel like I've graduated.

I can't tell if that's good or bad for me. Well, I forget who said this. It's a good thing to graduate from your heroes. And certainly there are people that I won't mention who's religiously, everything that they wrote. I would just drop everything and read it. And listen, we're growing up. I'm returning. I still read the Buffett letters because I like it. This sounds so ludicrous. It brings me back to basics. Just like, oh, yeah, yeah, it's not that complicated, even though it is. But he makes it seem like you, Ben, you know what you and Buffett have in common? What's that? You can explain things very simply. Common sense. I think, For a young person, going back through and reading all his old letters and you get them for free right on the website is very helpful. And I'm sure there's other places, too, that have probably taken out the best stuff. And yes, it's very helpful to do. Fidelity is hiring 4,000 new roles. How about that? Nice. We're growing. I don't know if this was a week that I was less tuned to the news, but were there not a lot of layoff announcements this week? Because our layoffs section is pretty empty. I think you did pick a good week to call it off a week. It felt like it was a pretty

slow news week that you took off. Were you not paying attention to anything at Disney? I thought so. Oh, I was on my phone the entire day. Oh, okay. Well, I guess you're sitting in line. If you're sitting in line for an hour, you have time to do that. It didn't feel like a slow news week. Okay. It felt like the market was either down or fading every single day. It felt like the narrative changed last week, actually. Yeah, it did. I also think sometimes people are just looking for an excuse to sell. You wrote a post about this a month ago saying that like don't get caught up in the narrative vortex of the change, like, you're right. It's changing in a constant basis. constantly. And here's the other thing. We kept saying, like, why are stocks so strong? Why are we afraid

to say it's a new bold market? Which, my bad. But, all right, we had a 5% pullback. In this case, I don't think we're trying to over-explain or over-engineering explanation. I think it's pretty clear. The data is too strong and the market is reacting appropriately, in my opinion. This is from Torson Slack, I believe. The consensus, he's showing NFP, non-farm payrolls, better than expected, getting back to the strong economy. The consensus has been systematically too bearish in the economy for the past 10 months. This chart goes back to 1998, and that's a record. You would think that whoever puts out these estimates are catching up, and they're just not. This is probably one of the other things that this caught the most people by surprise is just the labor market just continuous

to be strong. Like I said, since the Fed started raising rates, from zero percent, the unemployment rate is down. And it's gone basically from zero to five, and the unemployment rate has fallen in that time. Yeah, pretty wild. All right. I think we've got a lot of stuff on real estate. Rick Palacios, your total number of realtors falling for the first time in a decade, tick down a little bit. I'm sorry, I'm sorry. It's realtors. What did I say? Say it again. Realtors? No, you say realtor. Oh, it just sounds better. Yeah, it's a common. People say that. Like nuclear, nuclear, nuclear. Nuclear. Yeah, people say that wrong. My least favorite one is Chapulte. Oh, it's awful. I can't handle. I can't handle Chapulte.

The average age of people who say Chipotle is what? Now I would say 49. It's not even that old, 53, 58? Do you sometimes find it with your kids that you find it funnier when they say things wrong so you don't correct them? Oh my God. So Kobe has not bad speech issues. He's in speech therapy, I guess. And there's a book called No David, which, do you know that book? Mm-mm.

It's a great book. And I was reading it in Logan's bed last night. And they both say, no, David. But Kobe calls it Dave End. Okay. And Logan was getting so mad. Logan's like, it's not David. And Kobe's like,

I'm saying David. It was hysterical. So yes. My daughter, Kate, she puts a D in front of some words that don't have. So instead of saying remember, she says de member. And my wife and I crack up every time. She says, do you guys de member? And we crack up every time.

I don't want to correct her about it because it cracks me up. All right. By 2020, the number of realtors surpassed the number of homes for sale. We talked about this. Now it's fallen from 1.6 to 1.5. So it's fallen a little, not that much. This is surprising to meet. Typical realtor in the U.S.

Has eight years of experience, works 35 hours a week, and earned a gross income of 54,321, according to the NAR. I think some people think this is going to be easy work. I sell a few houses. The commissions are big. It's probably a power law thing where the top five or 10 percent of them make most of the money. I also do wonder how many of them do it part-time? I'm sure a lot of people.

And I'm sure in the pandemic, a lot of people thought like, oh, yeah, this is a part-time gig. I'll just pick it up. and most of the people who pick it up part-time probably end up falling by the wayside eventually. Although they do say the typical realtor. So that would, you know, an average to me has eight years of experience, 35 hours a week. It's a lot. Yeah, the other thing is it's not like you're working nine to five hours.

You're working on the weekends. You're working probably at nights when people want to see houses. I'm anti-realtor. I sold my apartment by myself. If I ever sell my house, no offense, probably can do it by myself. But I get it because from the sales point of view, it's like, wait a minute. Why am I giving this person 3% to open a door? Listen, I used to be like that.

I've had two good realtors in the past seven years, and I found them both very helpful in the back and forth in negotiating the contracts and stuff that they handled. I thought they were worth the money. I used to be in your same boat. I think in New York it just costs way more. But I thought, as far as I was concerned, people who did it for me were very helpful in the negotiating process and the back and forth, handling all the behind-the-scenes stuff and transfers.

I'm not trying to on realtors. My point was, though, it's a super hard job. and the reason why the commission is what it is is because they got to eat. It's hard. It takes time to sell a house. It's not like you sell houses on day one like we did during the pandemic. That's not normal. My neighbor sold his house. I see it on Zillow. The last price cut was $2.90. And I asked why. And somebody said just so he could like get back to the spur activity. It says it's pending. Although, oh, wait, it says this home has a pending offer. Oh, interesting. But that doesn't mean anything. This is why you need a realtor in your life so you can ask them,

what did it actually sell for? A pending offer. That means nothing. All right, so maybe I jumped the gun on that. We'll see. You forgot to tell us the biggest thing about that's happened to your life in the last three weeks. You finished your mudroom. You sent us pictures. You finished your mudroom.

Did we speak? I don't know if we spoke about this. Maybe we did on the previous podcast, so we forgave me if I'm repeating myself. But when we were in Miami, everybody who came up from me said, how's the mudroom? And credit to Robin. It's a good mudroom. She did the design and everything. It looked nice.

Thank you. She did a good job. We talked about this for. Kids have so much stuff. My kids come home when they have their backpack. and there's snowbags and you need that kind of stuff. You need like a locker for them all.

Ben, we have been on the right side of this, I believe, of why Starter homes don't make sense. But the angle that we were taking was moving and all this, it's stressful, it's time consuming, it's expensive. One thing that we didn't consider was interest rates could go from 3 to 7%. We were definitely in the maybe rates

are going to stay low forever camp. I'm not afraid to admit it. I said that. We definitely said that. That's one of the things that were wrong, but there was no one. Not one person said mortgage rates are going to 7%. Of course. It was obviously pre-pandemic.

But anyway, one thing that we didn't consider about why start-homes don't make sense is if you got into a starter home in 2020 or 19 or whatever, you're staying. You're stuck. Yes. You're going to add a bedroom. You're going to fix it up. Yeah, you're not going to sell it. So we spoke about U.S. existing home sales just completely collapsing. I think it's 12 straight months.

I think it might be a record of declines. So U.S. existing home, this is from the journal who Ben likes to steal stuff from, U.S. existing home sales at January by price change from a year earlier. So a million dollars and up, down 40%. Oh, wait, what is this show? This is not price chain. Oh, I'm sorry, by price. My bad.

My bad. So homes that are a million dollars. Those U.S. 60s home sales are down 40% year over year. So they're not selling. No, you can't. It's too expensive. Which is also interesting because you think if people are paying $5 or $10 million for a home,

some of those people are buying in cash. and that rates shouldn't matter there. Apollo has some graphs. They show the housing inventory decline, which it bumped up when rates went up and then it just is crashing again. And they're also showing that the number of days the houses for sale has gone up,

which makes sense. Lance Lambert, mortgage purchase application index is at an all-time low going back to 2000, meaning there are no mortgages being originated right now, which makes sense. Imagine being a mortgage broker in 2021, having probably the best year of your entire career to 90s,

And you put a drawdown. Awful. Really tough. Do you think we get a pre-pandemic housing market coming back? Are the demographics and the changes that we've seen are all these numbers are going to stay low for like the next decade? Which numbers? Just the activity, staying lower. Is this going to be a one-time 3% mortgages are going to be paying over the housing market for a decade? Oh, I see what you're saying. I still think the structural imbalance between more buyers and sellers is real, but with mortgage rates at 7%, it's just, you're frozen. Every time we talk about this, someone says, well, people get married, there's death, there's dying, there's divorce, these things, and obviously there's still transactions

happening, but it's so much lower. It's down 40%. Yeah. Here's from Home Depot CFO. The housing renovation boom is still intact. They say, let's see, 90% of homeowners either own their home outright or have a fixed rate mortgage under 5%. And so they're saying for them, that's great.

rate. Home Depot, we love it. Renovation boom is going to continue, especially when you consider how much equity people have in their homes. That's what I said. Even if you're a home equity line of credit is now 7%, you would rather take that equity out of your own home and redo it than you would probably take out a new mortgage. No doubt. Let's do great quarter guys. Okay. I finally listened to my very first live quarterly call. Someone was posting quotes from the Toll Brothers call as it was happening on Twitter, and I said, oh, wait a minute. Let me pull up quarter. You can now listen to live calls. I listen to the toll brother's call for the first one. And they had an interesting point about people who build new homes. This is from their CEO. The buyer doesn't have a mentality of,

I'm locked into this six and a half percent rate for 30 years. Refis happen all the time. Our buyers are sophisticated. They know for two, three, four thousand dollars, they can get out of a high rate and get into a new low rate. They don't want to get out of their lives. They took eight months off. They're now sensing some urgency. And I'm not saying rates aren't important and they don't impact affordability. They do. But for our business model, it is not the number one thing. And Axios had this thing saying that part of the reason that these home builders doing so well, Pulte's offering 4.25% Linar is offering 5% for mortgages. 75% of builders are dangling mortgage rates that buyers can't find on their own through lending

institutions. So the home builders are doing mortgage origination now? Yes, and they're paying down rates for the buyers. How? They're paying the bank? Yeah, so you can pay points. You pay more money at closing and you can get a lower rate. You could do that now if you wanted to. So instead, of lowering their prices substantially, they're paying down the mortgages for people that are offering huge incentives because the home builders need to get that inventory off the books. They need the activity. They need the stuff to keep going. Interesting. That's why if I was in the market for a house right now, I'd be talking to a home builder. If I could afford it, I would not be looking at an existing home. I'd be going to many home builders in finding places where I can build a new home and

negotiate with them and get some incentives. Survey of the week comes from Coinbase. And they say, according to their study, more than 50 million Americans own crypto, or 20% of the adult population. At first, I thought this was crazy. No way. No way. So I think this might be overestimating it by 2x. 4x. I don't think it's completely egregious. You think only 50 million?

There's 300 million people in the country, 30 million people in the country. If 50 million people on crypto, Bitcoin would be at 200,000. One out of every five adults. I'm going to say one out of 15 adults, maybe even. one out of 75 adults? I don't even know. 50 million is a lot. That's taking a wild leap from the survey. I agree. They say one out of five. So what do you say? I'm going to say one out of 20. Five percent? Even five percent is a lot. Five percent is probably all right.

Five or ten percent. Yeah. I guess we'll never know. All right, let's get into some auto stuff. Wait, we should know because crypto's supposed to be so out there for everyone to know. The addresses, someone can look at all the addresses for us and tell us. Yeah, but there's a lot of chicanery that goes on with that. True. Some 9.3% of auto loans extended to people this from the journal with low credit scores were 30 or more days behind on payments by the end of last year, the highest share since 2010. Now, these are for subprime borrowers, those with a credit score of less than 660.

So that makes sense. They have another try. If you look at subprime delinquency rate by credit score, it's really people that have a credit score of 300 to 530. At that point, it's like 25% delinquency rate, which is high, but that's a very low credit score. I don't know how many people this represents. You probably build that in for low credit scores. So if you look at the New York Fed puts out this thing on credits every quarter, and they did percentage of balance 90 plus day delinquent by loan type, credit cards, student loans, auto loans,

mortgages, and home equity. And auto loan is basically steady over the last, I mean, it's gone up and down a little bit, but it's not looking terrible yet. No, it's on all the time of all. But still, yeah, no, you're right. Auto loans look pretty healthy. So anyway, car dealership guy said American Car Center, a 50-sour subprime dealer group, just went under this morning. No pre-warning or anything to customers or employees. He also predicted, this was back in December, that used car dealers will shut down in 2022 at the fastest pace since 2009. So there you go.

This was pretty insane. He also tweeted. Just because the activity is so low or what? Because prices are too high and people aren't buying used cars anymore or what? Or they're just not a inventory? I don't know if it's because credit is deteriorating. I don't know. A woman goes viral for buying a 1998 Ford Escort for $289 a month.

Oof. For 84 months. Oof. Ouch. We went to Arizona for a little four-day getaway for like midwinter break. These kids have so many breaks now. And we went to Phoenix and we rented a car and they didn't have a SUV, so we got a sedan. I was driving like a Nissan Ultima.

And man, do I miss driving a sedan? Do you know how much gas mileage those things get? I know SUV and truck gas mileage has improved. but we got like 500 miles to a tank of gas in this thing. It's like driving a little go-kart. I wish I could drive a sedan. I just need like a six-seater sedan. Like a limo.

I need a limo or something. Well, when we took a car to the airport, we were in, I don't know if it was like the suburban, like the extra long one, but it had the two pilot seats and the third row behind it, which is way easier than having the second row like flip over. That was very nice. But the Grand Wagoner car dealership guy tweeted this, $11,000? Hello? That's insane.

What is the payment on that thing? Honestly, is that $2,000 a month? I have no idea. I can't believe that. Maybe the Fed should do $50. Gambling in the U.S. reached a record high last year as commercial casinos and online betting apps reaped more than $60 billion in gambling revenues. This seems like the kind of thing that's just going to go up every single year. So here's an interesting quote.

about like people's behavior. Somebody said, the surgeon gambling was initially attributed to people having economic stimulus money. But I think it's hard to make that argument now. Yeah, I think so. Across the U.S. gamblers lost $34 billion in slot machines. How is it possible? To each their own. But the slot machine thing, I will never get it in a million years. Players lost $10 billion on table games, up 14%. Sports betting generated a record $7.5 billion for more than $93 billion in wages, wagers on sporting events. Not bad.

So the Super Bowl broke records. This is the headline. We know that. That's going to happen every year, probably. Every year. Is this your first Carl Continia tweet from this week? Took a while. Well, we just discussed this.

This is from bespoke. Just showing retail sales by category. Bars and restaurants of 7% month over month. That's insane, no? In January? That was a Matthew Klein one. Yeah. People still going out.

Is there some seasonal things there? But it wasn't even cold in December. at least not where I am. Every time I go out to eat, the restaurants are packed, everywhere to go. All right. Should we do Disney? All right, so I took notes. I want to thank Michael Antonelli, who is a great person.

His email was so helpful, wasn't it? Yeah. Or was your personal consultant, too. Yeah, I was basically texting him the entire, not the entire time, but I was texting him a bunch. Michael told me to get these Balega blister-resistant socks. That's such a dad move. Blister resistance socks.

They're expensive. They're 20 bucks. I got four of them. And I got to say, incredible socks. B-A-L-E-G-A. Incredible socks. Absolutely incredible. Best socks I've ever worn.

My overall take from Disney, and I've got a whole bunch of notes, it is a premium experience like no other. So, for example, the wristband thing, right? Isn't that amazing? Forget about it. Incredible. So when you go to like Six Flags or any other park, I mean, maybe there are.

people sweeping up and there's no places to park your stroller at Disney. If you put your stroller someplace that's not supposed to be, they move it over to the stroller area. Yeah, they've thought things through there. It is just so clean and we really do pay for what you get. Or you get what you pay for? It's the most magical place on Earth, right? Well, that's for sure.

All right. So in the hotel, I noticed something, tip top cocktails. You ever heard that thing? No. You don't really a cocktail drinker, but they have these little cans. of cocktails in your room no no no at the convenience store oh okay they had like old fashions marg's oh pre-mixed drinks okay it was pretty good got a few of them effective you kind of have to drink to make it through disney i think as a parent especially with epcot yes so the first day that

we got there we got there on sunday at around noon and we did animal kingdom right away which is great planning by the person that helped us plan it because animal kingdom is not a full day thing it's just not a ton to do there so we spent half a day there that's where the avatar ride is So, Ben, you mentioned the wristbands that get you in faster. Avatar had a 215 minute wait. So it's like three and a half hours. So you buy these genie plus lightning lane wristbands where you could book two trips at a time and get ahead of the line.

For the first time ever, to the point about the economy being too strong, they sold out. That's crazy. So the next day, we did Epcot, which was incredible, the drinking, the countries, the rides. Epcot really is an adult place. It's not as much for kids it is for adults. Not really. Totally for adults. So then the next day we did Magic Kingdom, and we got a guide.

Now, Disney sells guides that are $6 to $700 an hour, and it's a minimum of eight hours. So it's like $6 grand. Jeez. We paid this guy for the same service. We paid him $200 an hour, which is still an insane amount of money. But I have to say, Magic Kingdom was absolutely swarmed. So this guy, like, got on lines for us, got us food. If Logan couldn't go on a ride, he stayed with Logan.

He's like your own Metaverse Avatar. Yeah, he was great. It was obviously ludicrously expensive, but if you could afford it, it was definitely worth it. So he, give me some good intel. So, Epcot, 100,000 people capacity. Okay. Magic Kingdom, 65,000. Now I'm going to ask you a little trivia, Ben.

65,000 people in Magic Kingdom. You've got these two hour, three hour weights all over the place. How many riders are in the park? Wait, what do you mean? Out of that 65,000, how many people ride the rides? No, I'm sorry. How many available rides are there at one time? How many available seats for rides?

Oh, jeez. So there's 65,000 people, how many rides go at one time? Or how many total bucks? How many people could be on a ride? Yes, I'm sorry. That was very confusing. 800, 800, 850? 2,200.

Okay. So 65,000 people and only 2,200 riders at a time. Nice little business. Yeah, geez. I noticed a lot of Bill's fans. Bill's fans travel well. Okay. Just an observation.

I also noticed a lot of LSU people. I tap one of them on the shoulder. Is there like a game here or something? What's going on? Apparently they traveled from Mardi Gras to Disney. Okay. They were all over the place. I'm just going through my list, so forgive me.

One night, we were in the hotel, turned on the TV, and I saw, oh, true blood. Remember that show? Vampire Bill? Whatever happened to that guy? I watched that show. The first couple seasons were pretty good. Amazing. Tailed off at the end.

Yeah. So I just want to give a shout. How about my thing? Why do they not have Disney Plus in all Disney resorts? Yeah, that's a great question. For free. Crazy. The true blood, the opening song is one of the best songs of all time for an opening show.

Yeah, that was. It was a really weird intro as well. Yeah, great tune. Not to overtake your Disney stuff, but at our hotel, we had really spotty Wi-Fi. I could not get good internet access because my computer didn't work very well. So there was no streaming in our TV. It really made me appreciate streaming and the ability to just find something on demand. There was nothing, like trying to watch something that's already started 15 minutes ago.

What am I? Schmuck. By the way, this whole thing that we're doing right now is basically for Michael Antonelli's benefit because you can't wait to hear about my experience. I should mention that I had an amazing time. Absolutely one of the best trips in my life. More importantly than me, the kids forget about it. And I almost cried, like watching their joy. It was just, it was too much. That's memories for a long time for you. Forever. Yeah. So that's what you pay for. Speaking of, not to put a downer in this, but some butthole message me on Instagram or left a comment, why would anyone in their right mind

introduce their kids to Disney? So many better things to do with the time and money. I'm sure this person's very happy, just a very happy. But how do you keep your kids from Disney? What do you mean to introduce? They have TV, dumb, dumb. Here's a thing. Would you be willing to go back next year already? Oh, no, no, no, no. This is like, you check it off your list and you go like five years later, right? Or you're done? I think I'm done. But if the kids wanted to go back in maybe 10 years, but no, I'm done. So anyway, so speaking of true blood, Tara, Suki's best friend was in The Last of Us. Yes. I did notice that, which, to be fair, has kind of tailed off. a little bit. It came out really strong. The last few episodes, I thought they need a big

finisher because I thought this week's episode was not that great. Yeah, okay, that's fair. Robin and I got into a little bit of battle over my tropical bros attire. Did you wear it to the park? That had to be great for Disney if it's warm. Exactly, because it's so hot. I wore it twice. She's like, listen, you want to be an idiot with Ben? That's fine, but you are not wearing that into the park. I won. I did wear it to the park. I noticed a lot of man fanny packs around the shoulder. Oh, okay. Didn't know that was a thing. Got to carry stuff, I guess. So we went to like a buffet, and at the end of the buffet, they have like desserts. And I grabbed a bread pudding, I think for the first of my entire life, said, yeah, I'd give me that bread pudding. And I realized

I'm my dad, because my dad's a bread pudding guy. Sooner or later, we all become our parents. And it's eating bread pudding at Disney made it really official. Did you lose it at all? Did you, like, get really mad or impatient at any time? And I'm at my wits end. Did you have one of those moments? Only one time. And it's funny you mention that because Morgan texted me he said I took my son to Disneyland for one day

and I was exhausted took me two days to recover just trying to understand how you and Robin are seemingly going out day 77 and everyone looks happy it's a lot

credit to Robin it was a lot that's one of those places where if you have kids you go to bed early you get at home the night and you're dead so then Wednesday

we did half a day at the pool back to Magic Kingdom Thursday we did Hollywood Studios and on Friday we just did a full pool day and I said to Robin I could not go back to the park on Friday

I would have lost it you need the pool day You know when you go on the ride and they take a picture of you on the ride and you get to see it afterwards, Robin spotted me, except it was a different bald guy. She's dying. We all look the same. All right, this is sort of random, but I had the pool. I noticed something that had never occurred to me before. People who lie face down on a lounge chair, what are they trying to do?

What do you mean? Like, is the goal just to burn the shit out of their back? Why would you want to tan your back? I don't even because they're trying to get a nap. Yeah, so you're even. If you just tan on the front, it'd be weird. if you weren't tan on the back, too, trying to even it up. Ah, see, my

aversion to the sun, I never got that. Now, it makes sense. We're almost done, Ben. Okay, there was, like, no Marvel presence in the parks at all, except for Guardians of the Galaxy? I'm guessing that is coming. I'm guessing there's going to be a big Marvel push soon. Has to be coming.

And I also thought, speaking of Marvel, maybe we'll get to that later. I feel like Marvel is, like, the perfect analogy for late stage capitalism. Just fucking done. Ant Man got slammed. Just completely out of ideas. There's nothing else going on.

After 45 movies, they had to run out of ideas eventually. So anyway, that was my experience with Disney. Could not recommend it highly enough. I know it's not a scorching hot take, but really just an absolute joy. Top to bottom, start to finish. I'm not a Disney guy, and the memories we created there, it was totally worth it, even though it seems like half the time you're going, are we really spending this? And you're like, you know what?

Screw it. It's the memories. Got to do it. You're creating nostalgia. Last last thing. How insane was that Star Wars ride in Hollywood? studios, the rods of the resistance. My wife lost her phone on that. You know that the car's whipping around? Her phone fell out and they had to go back and find it. And some guy randomly found it.

The amount of thought going into that was when they take you off the ship and they bring you to all the stormtroopers. And they yell at you. My kids still talk about that. How they, their grandma, the guys, the stormtroopers yelled at her and they're, they still think it's hilarious that the stormtroopers are yelling at them. Yeah, that was good. All right, any good recommendations. Did you see Succession is done for good now after the season? I think I'm okay with that. I'm great with that. Before we get to recommendations,

I just want to read this quick email that we got. Oh, this is a good one. I had to write it and to clarify something you inadvertently touched on during your brief tangent about actors' names. I believe that the Lee and Tim and Lee Jones is in fact a middle name, but there's a bigger backstory here. Credit point for Ben. The reason why some actors have middle names or middle initials is that SAG

AFRA, the actors union, requires all actors to register a professional name when they join the union. the union requires that those names be distinct from all of the other actors' names in order to avoid confusion. In practice, this is why you'll see middle names or middle initials in all references to some actors, especially ones who might have a relatively common first and last name combination, like Tommy Jones, hence Tommy Lee Jones, but there are many other examples name of few.

Samuel L. Jackson, Michael B. Jordan, Michael J. Fox. All right, we get it. So I guess I was completely wrong. Makes sense. I was completely wrong. Although Brian Austin Green is still a two-name last name. All right, Ben. So, yeah, Succession.

I'm glad they're going on the top. Credit to... Yeah, so many other shows... Yellowstone is the horse where it looks really good at the front and like a cartoon drawing and a kid's drawing in the back. It just totally trailed off

after the first three seasons. I'm happy with this. I watched the new Scream movie. I've been watching movies while I rubbed the Palthine. It was pretty good. Pretty good. Here's my one criticism.

Our movie's too self-aware these days because we went through the 80s when there was zero self-awareness. Nineties had a little self-awareness, but we're still like available to be kind of cheesy. and now the movie was so meta. There was talking about the original scream

and like trying to figure out as people are getting killed, like who's the killer and it was so meta that I think movies are too self-wear because of the internet these days. They want to be in the joke like wink, wink, wink, we get it. Yeah, that's a good episode. I thought it was effective though.

I thought it was a good movie. The original scream came out when that was in like eighth grade and that was a big deal when it came out. Was that 96? Yes. Incredible. It was a big deal. That movie shook the world when it came out.

I texted, so they had slips in Seattle on rewatchables the other day And I texted you this on Saturday night, I think, a Friday night. My mom was in town watching the kids play some sports and stuff. And when I was growing up, I watched football and basketball with my dad, and I watched movies of my mom. And one of my mom's favorite movies of all the time is Slippes in Seattle. And I thought, why don't we rent this for something to do?

My mom and I watch Slippes in Seattle, drank a little wine. And it really holds up still. Again, very cheesy over the top. But is Tom Hanks the best yeller in movie history? When Tom Hanks raises his voice in like a funny way, though, him yelling is gets me every time. I don't know that I ever saw the business in Seattle. I think I might have gone to the theater with my dad to see it, but I can't quite remember. Tom Hanks and Meg Ryan both throwing like 101 miles an hour.

Just. What's the other Tom Hanks, Meg Ryan, Romcom? That came out around that time. You've got mail. That's the one that I saw. We actually watched that one this weekend, too. Not as good, but some people still like it. One more thing.

I watched Primal Fear the other day. Did the 90s use up all good movies endings? So we have Fight Club Primal Fear, usual suspects in seven, all with like these fantastic twist endings. Did we use up all the good movie endings in the 90s? I feel like Primal Fear showed me what a movie could be. I was young, right? But I was like, whoa. Yeah.

Finally, we finished 1923. I'm doubling down in my take that this show was good. They had a story about like the son and his new wife getting home from Africa. Is I have a Ford? Yeah, the whole show on just them. There's a season two, and I'm in for season two. I thought the first season was really good. Better than I thought.

Is it Paramount Plus? Paramount Plus. I don't think I have Paramount Plus. Shrinking I'm kind of out on. Okay. Really? I only saw two episodes. It was a little too corny for me. Okay. Yeah, it was cute. It was a little cheesy. So Harrison Ford's betting 50, 50 for me. All right. What do you got?

So I am very surprised with your honor. Are you watching it? I couldn't get into second season. Is it worth it? It's awesome. Really? Okay. Awesome. It's good. After season one, I said, I liked it, but I think I'm done. I don't think I'm done. But it's good. Okay. I'm in. It's good. On the Airbus. plane on the way home. I was on an old jet blue airplane and they didn't have like where you could like pick the new movies. There was three options. It was Waconda forever, something I've never

heard of in the menu. So I rewatch the menu. It was even better the second time. Okay. I thought it was okay. Yeah, so did I. So even better the second time. All right, real quick, highest grossing films of 2003, even though Ant Man by all accounts stunk, which is sad to me because I really liked the first two, still did $120 million. Domestic, 350 worldwide or 360, which is not a bomb. How about Megan? How about who went to see 80 for Brady? What even is that?

I don't want to talk about it. Okay. So I did not see Cocaine Bear. Surprising. A lot of people tagged me. Snakes on a plane. I'm not into that where it's like too over... Listen, I mean, I'm obviously going to see Cocaine Bear at home.

But I like Crawl. I like the Meg, where it's not just a complete outright joke. And March, I'm very looking forward to. Listen to what we've got coming up from March. We've got John Wick. I'm in for that. scream definitely seeing that it's in new york creed three yes 65 so those are probably four visits to the theater for me murder mystery too yeah first one was kind of i might see one of these movies maybe

what about what's tetris i don't know how they make a move bet is that the video game petrus which are these are you going to say 65 probably maybe scream i'll watch the other scream and i might even watch chazam i like the first one anyway this is kind of a depressing slate of movies nothing new anymore late stage long episode today but we had to catch up we had to catch up Animal Spiritspod at gmail.com thank you for listening

and we'll see you next time