Animal Spirits Podcast - Best Case Recession (EP.100)

Episode Date: August 28, 2019

On this week's show we discuss the finances of having kids, the best case scenario for the next recession, is anyone bullish right now, hedging out the end of the world, Michael's worst take ever, Ben's student loan story, Joe Rogan, trading options, the best book of the year so far and much more. On this week's show we discuss the finances of having kids, the best case scenario for the next recession, is anyone bullish right now, hedging out the end of the world, Michael's worst take ever, Ben's student loan story, Joe Rogan, trading options, the best book of the year so far and much more. Learn more about your ad choices. Visit megaphone.fm/adchoices

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 Rithold's wealth management may maintain position. and the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. Michael,

anything going on in your life these days? L.O.L. Ben. Laugh a lot. One question. Have you started your 529 plan? No, because you need a social security number, but more importantly, I'm waiting for the dust to settle. Okay. So you had a new child on Friday. Thursday? Friday morning. How are we feeling? Good. Thank you. So when we had Kobe in February 2017, I think it probably, it took me a while to get there emotionally. Something that I was told that dads are not told. And obviously it's different for everybody. So I don't want to speak too broadly. But for me personally, it took a few months for me to develop like the emotional connection with him. For mothers, it's instantaneous for obvious reasons. But with Logan, the new baby, it was a very different emotional reaction

that I felt immediately tears everywhere because I know what it's going to turn into. So it was definitely different for me. That is one of the good parts about the second time around. is you know what to expect a little bit. There was so much in that first time where you're just, you're totally blind. We spoke about this. And maybe I blocked it out, but it was funny because Robin's like, oh, I can't believe we have to wake up every three hours. And I was like, oh, my God, I forgot about that.

So we went to sleep on Friday night and woke up, and I'm like, what time is it? And Rhomba goes, 10, 15. Whoops. And so I named the baby Logan Graham. And more than one person has asked me if I named him Graham, an homage of Ben. And maybe some consciously, I did. I guess I would be lying if I said, like, I didn't think about it at all. However, I didn't think of the name. We were thumbing through like Tinder for baby names.

Oh, and that's what you came up with. You guys actually pick the name from that thing? Yeah. And my wife and I both liked it. I guess I liked it a little bit more than she did. But so no, it was not a direct reference to Ben Graham, but I guess I would be lying if I said he didn't like cross my mind. I hate to be that guy, but when does the financial implications of having a second baby hit or has it already? I started a post about this last week that I didn't get to. Somebody asked me about the financial implications of raising a baby. So I wanted to run this by you. Because I never really, like, put this into a spreadsheet and figured out what it was. And this is just an approximation. But tell me if this sounds about right to you. So for monthly expenses, I got daycare at 1,500.

College fund could obviously be whatever you choose, but let's just say $500. Food, $250, activities, soccer, gymnastics, whatever, whatever, another $250, clothes, $100, life insurance, $100, diapers, $50. I don't know, I just sort of made that up. So that right there, does that sound approximately right? Like ballpark? Looks right to me. Okay. So that's $27.50 a month, which is $33,000 a year. Yes. I was telling you recently, I've become a little more empathetic to the fact that it's hard for a lot of people to save. But especially when you have kids, I really understand why people have a hard time saving money. Yeah, of course. It's ridiculously expensive. The alternative of no daycare is someone stops working or stays home and then you forego that income.

I guess the only other way that you could kind of do it and have both spouses work would be if a family member helped out. But still, there are no easy choices for a lot of people. I would love it just if we had daycare as a public school option. Like we have public schools. Why can't daycare be that same option, I guess? It's so cost prohibitive to so many people these days. Especially now when you have multiple kids, we just had our first go to kindergarten this week. And getting her off of the daycare bill was amazing.

Obviously, we still have twins going through it, but... The other side of the ledger that isn't discussed, and this is probably not huge, but you definitely spend less on yourself. Yes, big time. Once you have a child. So that puts maybe a little dent in it. You're not going out as much. You're probably more conscious of where you spend your money on buying a pair of clothes or whatever.

Yeah, I mean, you don't go to movies by yourself on a Friday night. No, it is true. I've made that point before, too, that you spend less in yourself. But especially in the first few years, I mean, maybe people have tried to tell me that it just keeps getting worse because the activities build on each other. But in terms of like the daycare and the diapers and all that stuff that you have to continuously buy that those first whatever three or four years, it's a lot. And then there's of course there's other expenses like one time things like furniture, religious ceremonies, maybe a baby nurse, like things like that. So it definitely adds up.

Yes. Yes. Having a kid is expensive. So if you want to retire early, don't have kids. Right. Is that we're saying? Yeah. Yeah. All right. Hot take. Maybe I'm coming around in your headline idea stuff. but well well no i want to lay out the best case recession for you here i'm trying to figure out what is because listen we're going to have a recession at some point you can't put them off forever eventually there's going to be recession it's just part of how these things work national australia yeah right 25 years or something okay either way the expansions are extended but eventually there's going to be recession i almost want to just rip the bandit off obviously but i want to find a best case scenario and i think the best case scenario maybe is this stupid trade

war and then you have someone to blame for it like wouldn't that be the best case scenario and for a few reasons one it would almost be like a gift to stock market investors to be like yeah listen everything was going fine and the economy was doing okay and then we had this trade war that was seemingly forced upon us and so a kind of into recession stock prices went lower buying opportunity maybe we don't see a 50% crash like we usually do we have in the last two times you know what, I don't think this take is too hot because I think it's dead on. Because I think maybe this would allow people to look through the decline in prices. Not, I mean, stocks fall because people sell. But for people that are able to see through it, the idea that the potential recession

feels tangible, like you could say, okay, once we get past this stuff, I think you're right. But Mark Dow, I think is the one that said like a recession with GDP growth at whatever, two and a half percent, maybe three percent. It's like jumping out the first floor window. Right. Yeah. Maybe that's, it's not as major a recession as people are predicting. And you know the other great thing about this, just from a personal standpoint, is all the people who have been calling for recession for the last eight years, they wouldn't get to take a victory lap, really. Like hell, they won't. The stuff that they've been screaming about, it wouldn't be able, they wouldn't, well, yeah, you're right, they would. They still would. They're going to anyway.

Well, the Fed policy caused the trade war, obviously, if you've been paying attention. But of course, we can be in a recession now because all of the stuff is very backwards looking. like we just don't know in real time. However, Urban Carmel tweeted last week, I believe, trucking tonnage is up 7% year over year in July to a new all-time high. Trucks carry 70% of U.S. freight. I feel like we are really getting in on the automobile signals lately, the transportation signals. I just call it how I say it. Patrick O'Shaughnessy tweeted, is anyone bullish on equities? Which is kind of interesting because seemingly nobody is optimistic except for the market, right? the market is what, 5% off all-time highs. Yeah, it's really not that bad. So it is a very hard

circle to square because everyone, quote unquote, is bearish. Do you agree with the fact that people say, well, maybe no one is saying they're bullish, but everyone is positioned to be bullish. So the fact that people have more money and equities, I don't really buy the fact that you can say people are bullish, though, because of that. I think people have, I'm in the Tina camp where people have no other options, right? We're living longer and people have to take some risk for retirement. They can't, earn five or six percent in a treasury, you have to accept volatility. And so the fact that more people are in equities, it makes sense. I don't think that necessarily means people are bullish on the market. I think it means people have no other choice. Okay, fine, fine. But this is semantics. By positioning

yourself in equities for whatever reason, you are bullish, I guess, is the takeaway. But I hear what you're saying. I think it means you're reasonable. Like you understand over the long term stocks earn more than bonds. And especially with the expected returns on bonds right now, the hurdle rate is getting much lower for stocks. Okay. So let's put it into personal view. My investment portfolio is 100% stocks. I'm not like wildly bullish on the stock market, but I guess to your point, like I'm 34 years old, I mean, this is where my money is because... You're long term bullish. Yeah. I mean, am I bullish over the next year or even three years or am I bullish on the next decade? Hell no. Honestly, I don't ever even think that way, though, because what's the point? Right.

The people who have those stances are trying to prove something to someone and trying to be right or wrong. And who cares if you're right or wrong? Just so you can take a victory lap. You're not trying to be right or wrong. You're trying to make money. Right, Ben? You have that traitor's mentality. Yeah, you got me.

But in terms of, forget about people like you and me who are, I guess, cowards for not taking a short-term market view. But there's a survey, so take it for what it's worth. But this goes back pretty far. This goes back to 1998. net percent of asset allocators, I guess AA stands to asset allocators, say they are overweight equities. And right now, we are at the lowest levels since, believe or not, 2009, for people that are saying they're overweight global equities. Okay. Yeah, I wonder if people even understand what that means half the time. What do you mean? What are they measuring it against?

Okay, so they say global equities versus a 60, 30, 10 basket, which would be 60% equities, 30% bonds, 10% cash. So there it is. But again, this is a lie because people are, are overweight equities based on what the allocations show. People have more equities. And if you look at any of those numbers, remember the old Jesse Livermore, one that shows a percentage of asset allocation. People have more in stocks than they have since the early or late 90s or early 2000s, right? This is why we don't trust surveys, Michael. Come on. Get with it. Well, people are scared of the stock market, as I always are, but I feel like especially more so today. And so UBS was in the news because they were selling a product to appease investors

that are worried about volatility. You want to talk about this? Who is the PR firm who came up with this name? Because I think honestly, sometimes you can just tell by the name, it gives it a 20% higher chance of losing a lot of money because you know it's going to sell good. So this is called the yield enhancement strategy or YES for short. Oh my Lord. Josh and I were talking about this, I guess a few weeks ago when I think investment news broke the story or somebody did. And I said, how many times do you think somebody said these words, you don't say no to yes? Right. Yes. It's a perfect, I'm sure the sales strategy for this was great. They said they had

$5 to $6 billion. Marketing materials said the program sought to limit exposure to extreme market moves. And lo and behold, the strategy had losses of 13% in one month. And I guess I don't know what exactly the whole losses were, but it was bad enough that clients had to sue them. I guess I think it was a hand, like dozens of clients decided to sue them. One of the pitches from a broker, this is someone who is in the lawsuit said, her broker told, her, if the world came to an end tomorrow, you'd be the only one with any money left. And this is something that sounds unbelievable in a pitch. Guess what? If the world comes to an end tomorrow, your money is not going to do much for you. Right? Like, what is the point of money if the

world comes to an end? And I mean, if you have things completely hedged out and the world comes to an end, good for you. You're the last jerk with money and people are going to come take it. In that scenario... It's funny because UBS marketing material state the program seeks to limit exposure to extreme market moves. But then a representative said, clients who participated in the strategy acknowledged in writing that significant market movements could result in losses and they should not participate in the strategy unless they were prepared for potential of large losses. So on the one hand, they say that. But on the other hand, to what the broker said, they're also saying that sort of stuff. So I'm sure that there was disclosures up the wazoo in the fine print.

But who reads that? I'm sure this was like a 50 page prospectus that the lawyers made sure that they had their behinds covered. It also has like a one point. a 75% fee. It was some sort of option strategy. I'm sure no one who had money in this thing really understood exactly what it did or what the potential downsides were. The funny thing is these strategies that seek to head you against the end of the world and big market moves, they always seem to see these huge market moves when not much is happening in the market. What do you mean? Well, it's like the risks that they're trying to offload are seen in different times. So, well, if the market crashes 50%, this thing's probably going to be up. And then they

see their huge losses when nothing really crazy happens in the market. It's just like a one-off because they have these, it's like this four-corner option strategy that honestly I don't even really understand. But the whole idea that it was called yield enhancement, like how many retirees would turn that down these days because of the bond market idea, right? I'm sure that they were told that this is something that it's not stocks, but it's not bonds and it can probably get you stock like return with bond like volatility. And yeah, good luck with that. All right. So the homes on my block were destroyed by Hurricane Sandy. So there's like probably like three houses that are still there. You know, it probably

wouldn't have happened if we would have just nuked that thing. So there were like three original houses that are all like, they're pretty small. They're one story. They're probably 300 square feet or whatever, fairly modest homes. And one of them just got put on the market. And so all the ones that were knocked down were rebuilt into decent size houses. So this guy, hipster trader, tweeted a headline, Long Island home flippers sell to each other in red hot market. And he said, not the type of headline you see early in real estate cycle. So one of these houses that I mentioned went on the market, I guess on Sunday or something like that. And it was in the story. I don't know. There's no link to this. But point is this. My neighbor across the street who is our age

texted me that he's going to buy it and flip it. Oh, okay. So anecdotal, but I can correct. operate this headline. Anecdotal top in the market. You heard it here. That's just, it's a tough game. I mean, because you have to figure out whether you're putting money into it, how you're going to sell it. Do you think more people in New York are selling kind of like you did where they don't use

a realtor to help? I don't know about that. Probably not in the suburbs. But I was thinking about it for a split second because it is sort of seductive. Oh, you buy it for this and you sell it for 2X. But then I went through my mental log and thought about all the shit that I had to deal with getting into my home and the permits and all that sort of stuff. And it's a fall-time job. Like, I don't want to dabble in this.

Yeah, you definitely don't dabble in real estate, especially if you don't know what you're doing. And if you're going to make it your first time and you do it some sort of an expensive home in a nice area probably, like that's your risk is heightened. And obviously trying to flip something like that in the short term, you also have to take into account taxes and who the hell does a fixer up or during a trade war? This guy is not paying attention to headline risk, which you're coming around to and I appreciate that. Not necessarily head around. I guess I'm looking at true risk here. Not just headlines like you noob whales. All right. So Matthew Ball had a opinion piece in the New York Times. Wait, hold on. Can I just do a quick plug for that? So we're very proud and thankful for our listeners. As of this morning, we've got $1,013 from proceeds that we're going to be giving to the Fisher House. And Ben and I are going to kick in another 500. So thank you very much to everybody who bought something. We really appreciate it. Yeah, we really appreciate it. It was, I think it kind of blew away our expectations of the amount of stuff people.

purchased. People have been sending us pictures on social media. And yeah, we really appreciate it. This has been kind of a fun experiment to do. So maybe we'll do some more stuff like this in the future. And a lot of people have reached out and said that they had heard of the Fisherhouse Foundation in the past too. And it does really good work. So we appreciate all the help on that. Okay. In 2018, audiences worldwide spent some $300 billion on TV, $13 billion on video gaming, $41 billion on movie tickets and only $19 billion on recorded music. Wait, $19 billion on music. That sounds high. You think so? I mean, it's pretty low in terms of the entertainment categories.

That's just a big number. I guess if you include the subscriptions now, people pay to Spotify and Apple or Amazon music. I guess I didn't know what to expect. The fact that TV was five times as big as movie tickets, I mean, you can see why all these places are coming out with streaming. So in the next 12 months, we'll see Disney Plus, HBO Max, Comcast, NBC Universal's unnamed service, Apple TV Plus, and Quibi. That one doesn't really roll off the tongue. From Hollywood Executive Jeffrey Katzenberg. The point here was something that I've talked about before is that he talked about

how in the past people got really upset that they were paying big cable bundles for TV channels that they didn't watch. And all these other bundles are starting to come out because they want to take their properties, like people were, whoever owns the Friends franchise wanted to have it on theirs, so they're taking it off of Netflix. And so they're starting to parse these out again. So what's going to happen again is these streaming services are going to turn into bundles again, people are going to have to pay for them, right?

and people are going to have to, again, pay for channels that they don't want. I just honestly don't think that there is ever going to be a good solution for this. That doesn't include a bundle. I don't think what exists currently is terrible, do you? I've always said that I'm going to be the last man in America to get rid of cable because I love it. Unless you really want to be a minimalist and have the lowest possible YouTube TV or whatever or just an antenna and pay 20 to 40 bucks a month or whatever it is, you're going to have to spend some money and diversify your channels if you want to have all the options. And that's, I do.

I know that you did not get excited by the new Star Wars series at Disney Plus announced, but I think it's going to be such a monster. This was even before thinking of the other Star Wars and Marvel franchises. I've been on the Disney Plus bandwagon since the beginning. I pretty much started that car up on my own. And I think that's going to be enormous. Right? Come on.

Yeah. Can I pat myself in the back on that one? You can. I just, I mean, the fact that TV is so big. And I think that spread between movies and TV is only going to get bigger because the streaming platform, they're going to continue to take all the good entertainment from the movies, right? Yep. All right. Survey of the week. More than one third of borrowers said college loans and other money woes contributed to their divorce, according to a recent report

from Student Loan Hero, a website for managing educational debt. In fact, 13% of divorces blame student loans specifically for ending their relationship. The report found. And this was the survey of more than 800 divorced adults in June. I totally buy it. Good survey. This actually, yeah, might make sense. I just don't get, so I'm going to share my personal student loans. I actually just made my last student loan payment in August, July, whatever. No, you didn't. No, you didn't. If you didn't tweet it, it didn't happen. That's true. I think I did tweet it that I was almost down a couple months ago. So I issued a retraction. So I paid it off. And the reason I never paid them off before is I suppose I could have. My monthly payment wasn't that high

because my interest rate was so low. So I graduated from college in 2004, 2005-ish. And I consolidated I mean, it was, I guess, 25 grand or something, probably not much lower than that current average right now. But my rate was like 2.2%. And I think if I made something like 20 payments in a row automatically, my rate would go down another 25 basis points or something. So my rate was effectively like 2%. After inflation, I'm basically paying nothing. So it made no sense for me to pay it off early. And interest rates at the time were 5 to 6% when this was happening. So I don't understand why rates could have been so low for student loans back then and so high now. I know people have sent us some stuff about the new regulations they put in place. Well, that's it.

It makes no sense that they ever did this and didn't think like, oh, you know what, maybe we should go back to the way it was when interest payments were much lower on student loans. How dumb are they that this is becoming a problem? And it's self-inflicted in a lot of ways. I think that they thought that the system was not functioning properly. So they tried to step in. And I don't think that they made it any better, obviously. I basically got lucky to have rates where they were at the time. And it saved me a bunch of money over time, I'm sure. It's just, that's something that I just don't get how rates continue to be that high. So what's this Google story? All right. In June 2019, for the first time, a majority of all

browser-based searches on Google resulted in zero clicks. So they have this chart here, and it shows 50% of all Google searches are zero clicks, 4% are ads, and then the other 46% are organic clicks. Meaning, if you type something into Google, you ask, I'm looking for restaurants in Topeka, whatever, it will just give you those restaurants instead of you clicking on an actual website. So I think what I'm trying to say here is that all those SEO consultants that email you and I three times a week for our blogs might be out of business because the SEO stuff probably doesn't, search engine optimization probably doesn't work as well anymore if Google's just giving you the answer. It's just pretty wild that Google has figured out how a way to show above the fray

instead of clicking on a website, they just give you the answer without you having to go to that actual website. Scott Galloway talked on this pivot, how did you listen to the live version with Curiswisher? It's a little over the top, but he said Google is God these days. In the past, people would want something to happen and they'd go pray to God. Now they ask Google, which is a little, I mean, over the top, but he made the point that when you have a kid, what's the first thing you do when something goes wrong? You go to Google, right? But don't you think, especially that now that you have a new one, I think it's probably more for your first time parents than second time. when something goes wrong or the kid gets a fever or they have a rash or something and you go on Google, doesn't that almost make things worse sometimes? Absolutely.

When you do the WebMD and you think your child, their foot's going to fall off or something? We had that with Kobe. It didn't even occur to me to go to Google, but there was something like so absolutely minor. We went to the doctor and she told Robin to stay off Google. And I said to Robbins, like, have you been on Google? And she's like obsessively. Yes. It makes things worse a lot of times because you read the stories of here's the like one in six million bad thing that could happen because of this sim. And I think it almost makes it worse sometimes. Yeah. So there was a big article in The Atlantic about Joe Rogan and how popular his podcast is. And I have to admit, I don't really get it.

I've listened to Joe Rogan's podcast, depending on who the guest is. I'll tune in. That's kind of the way that I am. It's guest dependent. I was never one of his big stands that has listened the whole time. Yeah, I'm not sure that I understand exactly the obsession with him. I don't think I'm not like a hater at all. I think he's totally adequate.

But so there was, and I guess adequate sounds insulting. I mean, I think he's totally fine. Well, he obviously has a huge fan base because he's. he has one of the biggest top two, one or two biggest podcasts in the world, right? Yeah, yeah, yeah, huge. That makes a ton of money. He's got a huge audience. He's been building it forever.

I thought that this was a funny line at the end. This guy goes, Joe Rogan lives every day like it's his last. I live every day like I'm going to have to do most of this crap again tomorrow. So I read this one. This guy decided because Joe Rogan wouldn't do an interview with him, he was going to live like Joe Rogan. So work out and take all these supplements and eat the way that he eats. and it was interesting trying to understand through the eyes of Joe Rogan by living his lifestyle.

No, what I think he does, that's very, very smart. And he seems to be very authentic. Like, I don't think, at least he doesn't appear as if anything that he does is calculated. He just seems to be pretty genuine guy. But one thing that he doesn't do, and I think this is very smart, at least I don't follow him too closely, but from what I can tell, you never like see him on a private jet. Like, he's not flashing what he has because I think that to his average listener, that would probably be a huge turnoff.

Am I wrong? One of the videos of his I just saw was, yeah, he's. talked about what it was like to party for a weekend with Dave Chappelle. I saw that too, but that seemed to be sort of like a one-off. Yeah. No, yeah, right. You're right. He was saying this isn't really what I usually do. So Chappelle is more like that than him. But yeah, it was an interesting story. The video is probably worth watching what it was like to party with Dave Chappelle after a show, basically. All right. Let's get some listener questions. All right. I'm a fresh law school grad who is trying to learn more about the markets. Will we ever get the chance to

participate in an IPO like Amazon again or are those days long gone with how long companies are saying private. I would say that we're probably not going to see something IPO at 50 million go to inflation adjusted a trillion dollars. I mean, I think those days are over. However, I don't think that means that there won't be big opportunities. I also don't think it means that this is Amazon as a postal child for this, but who invested at the IPO and held it for 20 years? So I think that you should just forget about that in the first place. But as a, as an anecdote, or just one example, Facebook IPOed at what? A hundred billion and went to 500. So I think that there's going to be plenty of companies like quadruple and stuff, but I think the

Amazon's are probably long gone. I think that there are things they could do to make it so these companies don't say private quite as long. But I think the fact that private equity and venture capital has now gotten so institutionalized and much bigger than it was in the past that if they don't want to, a lot of these companies just don't have to go public as fast. So there really is no incentive for them to do so if they have enough funding. But I think if you're trying to learn about the markets and one of the things that

you're trying to figure out is will there ever be another Amazon IPO again, that's probably not one of the first lessons you want to learn because that just kind of sets you up for failure. If that's what you're trying to look for is the lottery ticket, that's not what markets are really about. That's more you're trying to get lucky, basically. All right, here's two questions by a person who's trying to become a trader. So maybe this one's for you, Michael. Two questions. What do you think about the Jim Kramer idea of putting your first 10 grand in an S&P 500 ETF? And should amateur traders ever dip into options. One, I go where his head is that because he is a big advocate of doing individual stock research. So I think this is like sort of a hedge against what he's doing.

So I think it's reasonable. But I don't think that's probably a great. I mean, it depends what you're trying to do. And I've said this again. If you are trying to become a trader, then trade. If you are just trying to like build a base and invest and you really don't want to be obsessed with the markets, then I think that buying an index fund is totally an appropriate first move as you did, Ben. But if you are trying to trade, there's no substitute for trading. so I would say to do that. I do like the idea of first having this thing taken care of in building a base and having the simple stuff saved

and then getting into trading. So after you already have some money saved and something that's more diversified, I think that actually makes sense. You're different. I think that most people start out with the mentality that they can beat the market without knowing anything because most people are overconfident.

So I just don't think it's practical for people to buy an index phone because they're just going to think it's so boring. So I think if you try first and most likely fail, then maybe you will buy an index fund, but the reverse isn't true. You don't think it's a good bogey to be able to compare yourself to, so you have this 10 grand or whatever sitting in an index fund, and then you have your other money that you're trading with. That is the waiting on fire.

You have something to compare it to saying, and that gives you, if you get out of the gate and you do great, you're probably going to say, I'm taking that 10 grand and I'm putting into my trading strategy, and maybe you light that on fire too. But you have that to compare to and you do it for a couple years and you say, you know what, this money's been sitting over here doing way better than me. Maybe I should just stop altogether. You should have led with that because that's a persuasive argument. Should amateur traders ever dip into option? If you like to have fun, then yes. If you're trying to make money, probably not.

How many options trades have you made? Oh, hundreds. Really? Back in your trading days? Yeah, yeah. I bought weeklies all the time for fun. One time I meant to buy puts on Zing and I bought calls. Weeklys, I was like, all right, I guess I'm bullish now. Okay. Recommendations. Let me start with this. So we were in the hospital, Billy Madison was on. And your Adam Sandler theory goes that he's no longer funny because he got too famous and too rich and lost touch, whatever, whatever. I have a new Adam Sandler theory. And I'm just asking, was he ever really funny? Oh, man.

When's the last time you saw Billy Madison? All right. It's been a while, but this is an awful take. No, it's not. Awful take. This is maybe your worst take. I think that we love Adam Sandler because of nostalgia. And I thought that he was, hold on, hold on.

Hold on. I thought that he was brilliant on Saturday Night Live. his stick was new and unique and funny. But him eating glue in Billy Madison, if you saw it today, you would be like, this is not funny. It's over the top. And I think every one of those kind of comedies

has an over the top element to them. And if he came out today, eating glue with the wood stick is not over the top. It's just not funny. Yeah, that's true. Okay. So I came up with this Sandler theory. I mean, I don't think he's done anything funny in probably 20 years.

But his stuff on SNL was amazing. That's what I said. Happy Gilmore was funny. Happy Gilmore was funny. Big Daddy was funny. I mean, he had a lot of funny stuff. I think there's so many quotable lines from those movies that have withstood the test of time that I think you have to lower look.

I think he's sort of like Eli Manning, like two Super Bowl MVP's, but passage of time has not been good for him. I like you, started watching The Boys on Amazon, I'm three episodes in and thoroughly enjoying it. I am surprised. So Barry Rittholtz told us that we have to watch this show, and we both kind of poo-pooed it and said, it's another superhero thing. It's on Amazon. I think I'm one and a half episodes in, and I surprisingly like it. because it's not, even though it's a show based on superheroes, it's not a superhero type of show where it's just a bunch of CGI fighting. That's what I don't like about those movies is it's all CGI fighting and bad one liners. But this is actually kind of a show that just uses superheroes as the background. It's satirical, right? Yes. I actually, you're right. It kind of, to me feels like, it feels like a movie. It feels like a good movie. I'm pleasantly surprised and my wife and I watched the first episode and he said, oh, wow, I like that better than I thought I would. So I listened to Ben Messerich with Brian Kaufferman and he's running a ton of books out of

become movies. I only read rigged, which was a book about oil. But so I picked up Bitcoin billionaires and just started. And I'm sure, I say all this books are fun. I only read one. But I've read probably six or seven of his books. Huh. I mean, they're a little over the top in that he embellishes the truth, you can tell, to make a good point. But he wrote the Facebook one during the social network, which was really good. He wrote one about this guy who tried to steal a moon rock from NASA, which was excellent. I'll have to figure out the name of that one. The one that he wrote about the card counters from MIT that was turned in. a movie you wrote two of those books were also excellent too so i'll put those in the show notes those

were really good actually land of the giants podcast that's about amazon did you start listening to that no who does that one it's fox it's very good like a history of amazon yeah okay does it talk about who bought the IPO uh no it does not okay we'll put it on my list all right any other ones yeah went to way fair i'm sorry not way fair way do they have fairways in michigan no what's that it's just an excellent supermarket okay supermarket or grocery store either way all right that's it Oh. Is this your new weekly thing talking about the grocery stores you go to? Well, no, I don't plan on this becoming a recurring segment. But, like, they had three dozen different types of apples. There was just an excellent store. Speaking of which, Honeycrisp apples. Paradox of choice.

No. Too many. Okay. I endorse Honeycrisp apples. That's my choice. All right, go ahead. Okay. That was one of those unpopular opinion tweets that is actually popular. What's that? You said Honeycris apples are good. Of course Honeychris apples are good. I actually had to Google it. I was like, at least a new invention because I don't remember these being around when I was a child. We always get the, yeah, I've got those for years. Like, I grew up on, like, Granny Smith and McIntoshes, and these are like 50 times better. Okay. We probably have better apple orchards in Michigan than you do in New York.

I'm just saying. Just put it out there. All right. So I finished the book, Alchemy. I talked about it a few weeks ago. I think this is, like, the behavioral psychology book of the year. And it's not even close. This was really good.

This Rory Sutherland guy, he has an amazing way of thinking about it. So he talked about how, so this is kind of comparison of that book of Loon Shots. So he said he thinks psychological moonshots are compared to. easier than actual moonshots that people make. So he said, people have been complaining London area about making the trains faster and how much money would cost. So he said, making a train journey 20% faster might cost hundreds of millions of dollars, but making it 20% more enjoyable may cost almost nothing. And he talked about how making a simple thing like telling people the train schedule and maybe giving them like an alert on their app when something is going to be

on time or late and just making things more enjoyable. So he said basically having these psychological improvements might be way easier in the future than having these fiscal improvements where we actually spend money on stuff. So he said that's where his line of thinking goes. A really good book. Chapters are very short. And so you can kind of skim over some of them and pick up on the good ones. It's very good. Okay. So our kind of entertainment usually goes TV shows during the week, movies on the weekend, unless there's a really good show we're watching. And so since there's no good movies out anymore, we rewatch this is 40 last weekend. It's a Judd Apatow one with Paul Rudd. I think so I just turned 38 like two weeks ago and I'm getting fast approaching 40 I know it's a bad look as you told me I'm fast approaching 40 I think that this movie actually was funnier to me because I'm approaching 40 and so I wanted to throw out a theory to you about the fact that depending on where you are in life movies can actually be funnier to you absolutely maybe Billy Madison would be funnier to be a little elementary school so here's some of them in my life that I think are funnier because of the stage of my life where I was at so American Pie came out in 19

1999, I believe, when I was a senior in high school. Perfect time. Classic movie. And actually, you might not know this. The guys who wrote it were from Grand Rapids, Michigan, and the school was actually based on a high school in Grand Rapids. I did not know that. What do you think about that?

Okay, Van Wilder came out when I was in college. Like, very funny movie, probably funnier for someone or they're in college. Neighbors, I thought, was kind of underrated from a few years ago. That might be a good one for you to watch right now because they have a young child at home and they're dealing with people next door. And then this is 40 for me now. So anyway. Good theory.

All right. So I think some of these movies are. maybe funnier when you are around those ages or those stations in life. Okay, we'll make one more plug. Newb Whale.com, if you want any of our swag. Again, all the money is going to go to charity. People have already spent more than we thought was possible, so that's great. Follow us on Instagram.

What's our Instagram handle? Animal Spirits Pod. Animal Spirits Pod. Michael says I'm a take machine, but he's a meme machine. And email us Animal Spiritspod at gmail.com. We'll talk you next week. Thank you.