Animal Spirits Podcast - Boomflation or a Recession? (EP.244)

Episode Date: February 16, 2022

On this week's show we discuss the latest inflation numbers, the Fed's conundrum, why corporations have the upper hand with inflation, bullish on Disney, BlockFi's SEC fine 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.   Learn more about your ad choices. Visit megaphone.fm/adchoices

Today's Animal Spirits episode is brought to you by our friends at YCharts. Remember, YCharts is a research platform that enables smarter investments and better prospect and client communications. We use this for our client communications. Let them know Animal Spirits saying you can get 20% off of your new subscription. Michael, what whitecharts data are we looking at today? All right. What we're looking at is a chart for the ages, Ben, and I do not use those words lightly. For the past 40 years, interest rates and inflation have both gone from the upper left to the lower right. They've both gone down. And now we're in this really weird period in time where even though interest rates are rising, which I think we have a chart

of the two year in here later for today, the 10 years now above 2%, but inflation is so far ahead. Actually, just eyeball on this, we've never had inflation this far ahead of interest rates, ever. And for a little bit, they were both rising at the same pace and then rates basically just sputtered out. Yeah, they've been rising a little bit, but isn't it funny when you see prognosticators say, like, interest rates spike today and it's like a 10 basis point increase or something? It seems so small, but I guess it's a relative basis. The big question is, is the Fed able to navigate this sort of soft landing where we can have inflation moderate without going into a recession, which I don't think, not that there's that many examples of this, but Tim Dewey on Oddlots was talking about

this. We've never had this before where the Fed or the economy has rained in inflation without a recession. So will this be the exception? Could be. The last two years are filled with exceptions. So we'll see. Go to Whitecharts selling we sent you. You'll get 20% off your initial 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 Holtz 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 Rittholt's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spears with Michael and Ben. Michael, we're at 7.5% now. I keep waiting for inflation to stop going up. It doesn't, it's not happening. Eventually it's going to happen. It hasn't happened yet. I finally subscribe to Matt Klein's substack, and I see that you put his story in here. I think it's worth it because the way he breaks this stuff down is helpful. So Matt Klein has been writing about inflation. He's been breaking it down into its components of subcomponents. And one of the big themes was a lot of this was supply chain COVID-related issues.

But now, over 90% of the components are above the Fed's target, which is 2%. And Matt Klein wrote, and we'll show this chart, this gorgeous chart, he wrote, The Consumer Price Index rose by 0.6% on a seasonally adjusted basis relative to December. The drivers of that increase, however, have begun to shift from pandemic-sensitive categories into everything else. So I was going through the report. it's everywhere. We spoke about this with Derek Thompson. Beef up 16 percent. Chicken up 10 percent. Gasoline up 40 percent. Furniture and bedding up 17 percent. Apparel up 5 percent. You know how much respect

of the tank the day? 80 bucks. Okay. It's up a lot. 80 bucks. What is it in New York? Four bucks yet? I think it's 350. Okay. Pretty close to here. So Connorson had this piece in Bloomberg where he said, listen, the Fed has two choices, basically. And I think maybe we give the Fed too much credit here. but speak for yourself speak for yourself i'm just saying like if the fed was going to do something about this inflation they probably had to do something a long time ago to get ahead of this is what i'm saying so they're playing catchable a little bit but he said should we accept this boomflation where we have higher growth higher wages and throw out that 2% inflation rate and say okay maybe our target now is more like 4% or 3% and 2% is ridiculous because if we do that 2% then that's

pretty much going to have to be a recession. So what would the Fed rather do? And obviously, I would think the boomflation scenario is preferable. Some people don't agree with that. And they want us to get thrown into a recession. I think the boomflation of keeping nominal growth higher and wages higher and dealing with a little bit higher inflation probably is the better alternative. I think so. The question is, and again, Tim Dewey was talking about this with Joe and Tracy, we can't know. But what if the Fed started to hike last year? Do you think that would have anything to moderate inflation? The lack of counterfactuals here is tough. I'm asking your opinion. I honestly don't know because how much of it is coincidence and how much of it is

actual the Fed doing something. Is the consumer demand and consumer balance sheet so strong that everyone's going to say, who cares about the Fed? I want to get into it a little later on Disney, but Disney parks were at capacity. Do you think those people who are spending thousands of dollars at Disney are going I go, ah, geez, the Fed just hiked to 50 basis points. I better cut back on this trip again. I don't know if consumers care what the Fed does at this point. I agree with you. I honestly don't know what overnight rates rising them to less than zero would have done to moderate CPI. Now, I do think that they should have raised rates. I no longer think that we need like emergency accommodative positions. At least cutting back on all their bond purchases that we talked about. It's not necessary.

At the same time, I don't necessarily think that that would have slowed down inflation. I don't know how much this really matters, the psychology of what the market is pricing in in terms of the Fed rate hikes. So we looked at this on Kalshi, and Kalshi has these bets that you can do for the interest rates in March that the Fed's going to set. The market is moving so fast. The market already hiked. Overnight rates are still at zero, but the market already hiked. I'm looking at this. So after the CPI report came out, I put a bet on that there was going to be a 50 basis point rate hike in March. I bought the yes contracts for 28 cents. I did it a couple weeks ago just because I felt like why that it was price pretty good.

I almost took it off actually and I probably I should have in hindsight, but we'll say. Now I'm riding with it. It came back in a little bit. It shot off from 28 cents to around 70 cents and now it came back down. But these markets, like the market is moving so, so, so fast in anticipation of what the Fed might do. If the Fed is going to do and people say like we need to get back to normalize 2% or whatever that rate is, but you're right that the market could do this for the Fed and they might not even have to get to those levels if inflation. cooperates. We don't know. There was a closed-door meeting yesterday. What did you guys talk about?

You had to look at the size of my briefcase and know what it really meant. This is a beautiful chart. So Carl Kintiniated tweeted this chart. It's a chart of CPI divided by median, what is this, household income? This chart from J.P. Morgan, and he wrote, is inflation triggering demand destruction, not at current levels? CPI divided by median household income paints a different picture about the U.S. consumer's ability to absorb higher prices. While energy prices are back to 2014 levels, incomes are 25% higher. So somebody, I can't remember who a quote tweeted this and said, the truth is much different than the picture that's being painted in the newspapers.

Like that inflation is killing us. And we spoke last week about is inflation like changing consumer preferences and habits? Not yet it's not. Because my point has been this whole time, consumer balance sheets are as strong as they've ever been. So if we've ever been able to handle inflation, it's now. Obviously, you could look at individual cases and show when that's not the case. But as a whole, the collective country balance sheets for households have never been in a better spot to handle this exact situation.

So we're going to talk later about Chipotle, but Neil Irwin tweeted Chipotle reported earnings last week. The CEO of Chipotle, Brian Nichols, said, we've done 6% price increases so far in 2022. Room for more. See no resistance from customers to price increases so far. Actually, I got resistance. I have resistance. I'm resisting. I'm going to the city on Thursday.

No, you're not. You tweet about it, and that's it. That's all you do is you tweet. This is above my line. This matters to me. I'm not paying $14 for a chicken bowl. I will draw the line of... That is my upper bound.

I'm not going above 14. That's the price for me if I do double meat. So maybe once a week I'll get double meat. Just, you know, I got to treat yourself. I still think it's a pretty good deal. 14 bucks? It's more New York, obviously, but you pay $14 for a beer in New York. No, I don't.

What are you complaining? I pay $19 for a cocktail. I don't pay $14 for a beer. But that's the point, though, is that people are not changing their behavior, and that I think these corporations, like, are going to keep towing the line to see how far they can push this because they can. All right. So a lot of people have been talking about this crazy smile, you, whatever you want, in the two-year yields, it's kind of crazy. So in December 2019, right before the onset of the pandemic, end of 2019, two-year yields were at 1.6%. Inflation was at

2.3%. Now, two-year yields are back right at 1.6, almost, 1.5. And inflation is at 7.5. And people are saying, like, these are violent moves up. And they are, like, on a realm of Are you poo-pooing this? Look at this chart. I feel like you're not giving enough credit to the fact that this absolutely matters. There's two ways of looking at this. One way, this is really crazy. And it is kind of insane. So it was at a low of nine basis points, basically a year ago. So rates are up 17 times over a year. It's a huge move from that low. It's a massive move. That's a huge move. On the other hand, people must say, like, oh, bonds are getting crushed. Look at this SHY, this HY chart I put in here.

This is the one to three year treasury bond. So this is basically two year treasuries. This is the ETF on a total return basis. Rates are up 17 times. This bond ETF is down 2%. So like people always worry about like bonds are going to get crushed when rates rise, especially on the shorter to mid duration range. That's not what happens at all.

Well, counterpoint. This thing is getting crushed by inflation, not rising rate. So after inflation, it's down 10%. But rising rate basis is only down. I'm saying people have always worried for years because you have this inverse relationship between bond prices and yields and whatever nerd talk. You're right. But my counterpoint would be that SHY, that 2% down move just took out two and a half years worth of income. Yeah, but your income is now back to 1.5%. By the way, that's the point.

We've been very consistent saying this. We need rates to rise. If you're a fixed income investor and most of us have some exposure to bonds, sure, you're going to take a step backwards. But the only way we're ever going to make money on bonds is by having some erosion tower principle in the short. term. So we could take one step back to hopefully take two steps forward. I'd love for rates to rise. And that's actually why short term bonds are pretty good inflation hedge, because you get those higher rates sooner, because the bonds that are in your portfolio are maturing faster and you're getting to move up the rate curve quicker than you are in long term. So I think the TLT I looked, which is the 20 to 30 year year, is down like 10%. But those are long term bonds. And you're not moving up as fast because rates aren't moving up there. So, Ben, we got an email from a listener

who said he started to listen to our podcast a year ago, decides to listen to the podcast. podcast on March 25th, 2020, because I really wanted to hear your perspective on the market. There was such an unbelievably volatile time. Apparently, I called the short-term bottom. So I was, like, very excited to go back and listen to that podcast. So market bottom on the 23rd. Yeah, I will say it all credit to us, not because I called the short-term bottom, and that was not a call. I went back and I listened to it.

I was not pounding at the table. I was basically like, yeah, I would have been surprised. So I was sort of disappointed that I wasn't more emphatic. But credit to us, because listening back to that, we were very level-headed. I think. We were like, if you listen to the podcast, I don't know that you would have thought that markets were down 35%. I think we might have said it a few times, but that was interesting to go back and listen to. So credit to you. We're also running on pure adrenaline and doing two podcasts a week and doing it from our closet or our bedroom, basically. What you did say, though,

this is a good quote from you. You said, in 10 to 15 years from now, I'm not going to care about what the markets did in 2020. So why would I change my investment philosophy now when stocks are at a discount. I think that was a combo of you and I, this person said. How about this one? I don't know if I said this. Someone called it. No, you did. You did. You did. If we get inflation 12 months from now, that means we won. I would be stoked. You literally said that. And I feel like having that sentiment because good on a lot of people. People were concerned about inflation even back then. It's going to come from this potentially. I still believe that. That the alternative is credit to those people, because there were a lot of people that were like actually saying that there

would be inflation. Also, you did a blog post last night with another listener email. A lot of people think that if you have an audience, you're bound to get trolls and people dunking on you, we do get some of that. But for the most part, our listeners send really valuable feedback and good stuff to read and charts. And like, we have a- That email we got last night, blew me away. It was fantastic. We'll share that on the show notes if you're interested. Credit to the audience for being so much credit. Just tons of credit. All right, this chart seems sort of out of place. But, oh, this is a good tease for Monday's episode. We have Julian Koski back on the show from New Age Alpha. He was the guy that came up with the

H-factor, which we got a lot of good features. feedback on that. And one of the things the H factor does is it basically determines how much noise is in the price or what are the, that's not true. The growth probability is implied in the price, right? Basically, like, trying to figure out what's price now. One of the things that he said that surprised me, I teed him up for Tesla thinking that it was so overpriced. He's like, no, Tesla has had a low H factor, which is a good thing, low probability of failure because they keep beating expectations. And this chart that we're looking at shows the electric vehicles. I knew that surprised you because you followed up with like three follow up questions

and you're like, wait a minute. It was not the conclusion. That's kind of like every once in a while, I'll have a blog post in my head and I'll look at the data and sometimes I have my conclusion ahead of time. And I look at the data. You delete your post mentally?

No, I deleted my conclusion and I had to change it because the data shows something different. So electric vehicles as a percentage of all cars sold. It was zero in 2010 and it's almost 9%. This is important. I just started a lease five or six months ago.

The next car I get will probably be electric. I'd be surprised if it's not. Don't you think we're getting to that point where you have to start thinking about making this? I always thought, remember we had conversations in years past about when our kids are 16, they're probably going to be having self-driving cars. And maybe that future will still happen. But they are for sure going to be driving electric cars.

There's almost no doubt in my mind that that's going to happen. Well, I definitely wanted an electric car after paying 80 bucks for gas. I'm jealous. Yes, it's not bad. I think my next car will probably likely be able to. Well, good news in the cars, used car prices are flat. out finally this is the whole thing about consumers though that how starved they are this is the one area for the last year if I would tell someone pump the brakes change your spending habits don't get a car

if you don't absolutely need one the prices for cars and used cars especially are insane so that's like one area where you could have helped yourself and I say this as both of us got cars in the last year But especially in the U's side, if you could have held off, that would have made a lot of... I didn't get a car. I bought my lease out. Oh, that's right. You bought your own car. Not to brag.

You hedged. I must have done it six months before things spike because they were asking me to trade my lease in and I got a deal. So we got lucky. My wife, we paid a lot more for hers probably. Ben, can I say something? Yes. That email about me calling a bottom has me feeling a little bit confident. So you know what I'm going to do?

What are you calling now? I'm going to call top in inflation. Oh, okay. There's this great chart. Liz Ann Saunders shared it. New York Fed survey of consumer expectations. The median one year ahead expected inflation rate and median three year ahead expected inflation rate rolled over pretty nicely. I'm going to do it. That's it. Prices have peaked. You may be right, but I would love to know who they're surveying on this and where those expectations come from. Do we really think consumer expectations on inflation are a good

indicator? There's no way. I mean, probably not, but I'm saying you could be right, but I can't imagine people have a very good read on what inflation is going to be, even if this turns out to be true. I will say that I am coming around to the idea that the supply chain dynamics was over discussed. Tim Dewey gave, I keep talking about, he gave this great analogy about it's hard to know where it comes from supply versus demand. He said it's like a scissor. Like you don't know which blade is cutting a piece of paper and not enough is being made of like the actual pent up demand. I agree. And that's the thing is consumers are I'm the captain.

And you, months ago, you said, thank God their supply chain issues. Oh. What if we were actually able to satisfy demand? Inflation would be way high. Again, a counterflactual that we'll never know, but I think that's plausible that inflation would be just the same if demand was able to be met. Yes. All I know is I would have gotten my car fixed a lot sooner and I would got a washer that

matches and not have two different washer dryer. What do you think has the biggest time inflation? What I'm hearing, it's furniture. Oh, that's not. You know, they had a story today in the New York Times about garage doors. So if you're building a new home, it takes a long time to make a garage door, apparently. A lot of weird things like that. I guess if you're buying furniture, you want to buy something that's in stock and not get

something that is crazy or hard to change. All right. Interest rates coming back up on high-yield savings account. Are they, though? I don't know. That's what this chart is showing, though. Okay. I feel like the Marcus one has been at 50 basis points.

No, 40. Oh, is it at 50? Yeah, it's at 50 basis. I don't know. We spoke about this. We'll talk about stable coins and blockfire in a minute. but what interest rate on cash would entice you to take money out of stable coins or something like that?

3%. Oh, that's not happening. I know, exactly. The funny thing is that these things act on a lag. So the Fed will raise rates and then these places will wait a little bit and then they'll raise a little bit. And then by the time, like, I mean, let's be honest. The Fed is only raising rates to cut rates in the future. We're going to be back at zero in the next five to seven years.

Let's be honest. Oh, that's, yeah, fact. I mean, so we're raising rates so we can lower them in the future. That's all we're doing here. I don't want to spend too much time on this because we have so much to get to, but this is a really good chart I wanted to share. Gabriel Zuckman tweeted, real income growth per adult in 2021, broken down. And the real income growth is 7.6%, which is great, matches inflation.

But it varies. And one of the reasons for the extent that we have a divide in this country, and we certainly do, it's because the middle class has not kept up. The middle 40%, only 5.1% wage growth. This is why people are unhappy, because the lower end is doing better, the higher end is doing better. And if you're in the middle, you're kind of getting screwed. You're looking, you're saying the people below me are doing better. People above me are doing better.

What do I get? Shout to Derek Thompson. This morning I was looking for, I wanted to know what's going on with Canada and the trucker protest because I keep seeing it, but I haven't read anything about it. I want to get the TLDR in it. So I went to the Daily, the New York Times podcast. They don't have anything on it. Like inexplicably.

How is it possible? And then this morning, Derek Thompson dropped a podcast. And one of the things, one of the undercurrents of that protest is just people are pissed off. And it's not necessarily a vaccine rally. It's just people are upset. And wages and economic splits are a huge part of that. So listen to that if you want to learn more about it. I don't want to poo poo like this stuff going on the news and people being angry. But that was the best part about being away last week and Disney for a whole week is. is just Disney feels like its own little country in some ways. Like you're totally disconnected from everything. And being away from the day-to-day news, I mean, obviously it's on your phone and you can check it if you want. But just being out of that grind was really, really nice.

Not having to worry about anything in the outside world for a week. It was really enjoyable. Oh, I just want to shout this out. A listener sent this to us. Ben, you've asked about this before. Fidelity actually offers a custodial Roth IRA. I funded one last year for my six-year-old with money he earned doing minor chores around the yard. he talked with two CPAs, and they saw no issue.

As long as you actually report any income for the child, that would be taxable, and don't go overboard trying to max it out at two years old, you can give them a huge like forward on savings and investing. And as a Roth, it doesn't affect financial aid. That's cool. There was another blogger I know who would include pictures of his kids on the blog, and he would pay them for it. That way they have income and then they can contribute to a Roth.

This is great and all, but it sounds like too much of a pain in the ass for me. Part of it for me is like, do I really want to go through the time and effort of doing this and then filing a tax return for them. Just make it easy and let them fund a Roth. That's all I'm saying, government. Okay, Michael, we've heard from people for a while since we launched our crypto index, asking when is it going to be available for other people, retail and advisors, and we're getting there. Retail not yet, advisors, yes.

I am doing a webinar with Jeremy Schwartz and the Enram team on February 22nd at 1 p.m. Eastern where we'll discuss the index and how advisors can access it for their clients. So we'll link to that. That is on February 22. And I think one of the coolest things about this, the whole crypto team at Wisdom Tree that they've built has been a great resource for us. They are very sharp and that's been cool to work with them. All right. So crypto ads at the Super Bowl is a big topic. Look at this chart. Before we get into this, my favorite tweet from that night was it was a comedian and he said, the only reason I'm still kind of nervous about crypto is because if crypto is going to be money. You never see commercials for money. You don't have to advertise money. Money just

is. Anyway. Not a fan. Not a fan. Oh, come on. That was pretty good. No, it's not. These are commercials for Coinbase. You don't see TD Ameritric. E trade advertised. I know. I know. It's just kind of funny. But anyway. All right. So, oh, I didn't tell you. This chart is from FinTech Frank. It's showing crypto app rankings on the app store and Coinbase obviously spiked to like, I don't know if it was number one, but it was close to it. I did a podcast yesterday with FinTech Frank. And I let him know what a big fan I was. I did with Jeremy. He's the guy with the mustache, right? Yeah. It was a thrill. All right. Before we get into the block-fi stuff, I want to my two things quickly. So I'm buying NFTs. Don't judge me. I'm judging you. I don't just have Eith sitting in my

metamask wallet. So I buy it on Coinbase. I try and transfer it over to my metamass wallet. If somebody has a better way for me to get money in my metamass wallet, it doesn't take this long. Please let me know. Look at this. Look at this. So you could send a thousand. thousand dollars instantly. But the rest of your purchase will be available to send in 12 days after your funds arrived. 12 days. Now, I think a workaround is I could have just wired money in instead of doing an ACH. I think that probably would have solved it. So I got a thing yesterday. I told you, Robin Hood emailed me and said, hey, you're off the wait list for crypto. I'm so jealous. We have a crypto wallet now. You can move crypto on and off Robin Hood. I said, great. So I signed up.

I had to do like a two factor authentication thing. It was pretty easy. And then they send me an email saying, hey, you're ready to go. And so I tried. it was pretty painless to sign up. And then I go to try, I said, all right, I'm going to try it today. I'm going to move some of my ETH off and I'm going to move it to BlockFi. And I go to do it. And first thing, it says you can only transfer $3,000 or less every 24 hours. I have more than $3,000 in crypto, not to brag. So I was trying to move a little more. But then you copy the thing of where to send it. It's like this huge string of letters and numbers. And I tried to transfer it to blockfi. And when I put it in there, it said, this address is not supported. We can't move it for you.

So what are you going to do? You'd open a Coinbase account? I have no idea. Opening a coinbase account doesn't help me. I have a great idea. Move it to Gemini. Put an entire index. I mean, that's what I'm going to do. Oh, that's right. I can do that now. I can move crypto to Enramp. All right, you just solved my problem. You're welcome. I actually did that. I did that. Not with Robin Hood. But I move money into my wallet at Onramp. And it was pretty easy. So if you have a lot in crypto at Robin Hood, they're not going to make it easy for you to move a bunch of money off all at once. Of course they're not. Of course it not. All right. So we've got tons of questions on board. We're about to get there. We're about. We're about. together, I promise. So when CPI was released on Friday, were you at your computer? No, you were in Disney. Okay. Bitcoin, along with every other risk asset, whoosh lower. And it's a good thing that I didn't tweet anything about Bitcoin being an inflation hedge L.O.L. Because about 30 minutes later,

inexplicably, it reversed way higher. Like it went from 45 immediately down to like 43. And then back all the way up like an hour later. People always say, okay, it's, the algos doing this, and obviously it is, they see the number and then they go, whose accounts are tied to these algos? Who are the idiots who are selling Bitcoin because they see a headline and then buying, like, whose money is this? It's hedge funds. I mean, what else is it? Who else are writing these programs? It's Bitcoin hedge funds. Then they're the dumb money. They see a headline, the headline. How stupid are they? I cannot agree more. But Bitcoin is many things. First and foremost, it's a risk asset. Yes. It's a risk asset. Maybe there will be

a time where equities puk and Bitcoin moons, but I doubt it. But maybe not. The other thing about it is, I think one of the things that people really took for granted with the growth stocks getting killed is not only like people think about asset class diversification and strategy diversification, but how about diversification of your investor base? So that investor base, what's the Carolewether's Schrozenegger meme where they hold hands like this? Predator. Oh, it's growth investors and crypto investors are all the same thing. Oh, what's his name in that? You son of a bitch. Oh, man, it's on the tip of my tongue. Can't remember. I can't remember either. I love that movie. So if you have growth investors getting killed, eventually they're probably going to have to sell some

crypto too. You have all these same people holding. So I think my point is crypto, maybe this is why they're doing all the ads. They need a more diverse investor base. Yes. Who's not just tech people who are invested in gross stocks as well. And I think that's probably coming. All right. So the deal is that BlockFi is paying a $100 million fine. I believe 50 is going to the SEC. 50 is going to the States. Here's the deal. We'll try and break it down as good as we can.

And I'm sure we'll... First of all, we get treated like we work at BlockFi, by the way, with the only questions that we get. Fair enough. Fair enough. No, it's true. But we had Zach on the show a bunch of times. To his credit, he put out a threat on Twitter, kind of explaining stuff.

Here's my initial read of this, without getting into the details first. I think the SEC is dumb. So dumb. that they're handling this. So it's not like BlockFi was taking advantage of people. It's not like they were doing something nefarious. Essentially, what they did is something like what Uber did or Airbnb where the regulations weren't in place for this type of product. So they kind of just did it. And since the SEC didn't have it in place, now the SEC is going back and saying, whoa, whoa, whoa, you can't do that.

Well, well, well, I think what they got banged for was, let's just read it. BlockFi made a material misrepresentation to investors, to BIA investors concerning the level of risk in its loan portfolio, beginning at the time of the BIA launch on March 4th, 2019, Block 5 made a statement in multiple website posts that its institutional loans were typically over-collateralized, when in fact, most institutional loans were not. So approximately 24% of institutional crypto asset loans made in 2019 were over-collateralized, again, meaning over-collateralized, meaning more than $1 for every dollar that they were loaning out.

But in fact, only 16% were over-collateralized. So anyway, what the SEC is saying is that although BlockFi made other disclosures on his website regarding its risk management practice because of BlockFi's misrepresentation and omission about the level of risk in its loan portfolio, BIA investors did not have completed an accurate information with which to evaluate the risk that in the event of defaults by its institutional borrowers, BlockFi would be unable to comply with its obligation, blah, blah, blah, blah, blah. They got five to $100 million for that. This is ridiculous. And the fact that we still have- Who got hurt? And I'm not trying to send it. a show for BlockFi, but they paid their interest. It would be different if they would have

figured out that it's a Ponzi scheme and BlockFi is taking in money from investors and that's what you're using to pay people. That's not what happened here. They actually had the money. They paid it to people. No one missed their interest payments. And in fact, their interest rates have interest rates have gone up over time. And we still have gray scale Bitcoin trust that's trading like a 25% discount in no ETF yet. And the SEC says they're protecting investors. It makes no sense. Excuse me that language, but well, give me a effing break. Seriously. Yes. This is just them like. Puffing their chest out and showing like this stuff. See, we did something. We don't like this stuff.

We did something. All right. So Hester Pierce, who is a governor at the SEC. She said, lurking behind the legal analysis, however, is an important question. Is the approach we're taking with crypto lending the best way to protect crypto lending customers? I do not think so. So I respectfully dissent. Again, she works at the SEC. She wrote, as an initial matter, it is difficult to understand how the civil penalty will protect investors. BlockFi will pay the SEC $50 million and will pay another $50 million in connection with state settlements for the same conduct. While penalties of size are intended to deter bad conduct, here there is no allegation that BlockFi failed to pay its customers, the money do them, or fail to return the crypto lent to

it. BlockFi's misrepresentations about over collateralization are serious, but the combined $100 million penalty nevertheless seems disproportionate. So what they have to do is basically they have to register, they have to go through this whole process, which we spoke to Zach. They want to do it. They want to register it. They need clarity. Yeah, they're now going to have a registered yield product. It would have been nice if the SEC would have said, go through these six steps before we ever get to fining you for it.

Like, taking the money just seems, it's like a mob practice almost, essentially. It doesn't make sense to me. So now they're going to come out with a regulated yield product, and I'll be interested. If you have an account like me, you can't put money in anymore and you can't open it. Are you worried about your money? Are you taking your money out? No, I'm not going to.

So they said they're still paying interest on it. And if they're not bringing more money in, I'm sure they're probably going to be fine. And now they're going to come out with it. it with a regulated product, I will be interested to see if a regulated product will be different or if it will be a lower interest rate or what the case will be. I'll be interested to see what happens of it. But I didn't think this is like some black eye for BlockFi. I think this reflects more poorly on the SEC than anything because they miss. I agree. And the last thing, I think this is important. So forgive me. Hester Pierce concluded her post saying, these products matter to people.

A program that allows people and not just affluent people to keep their crypto assets while still earning a return is valuable to many Americans as evidenced by the program's popularity in the United States to date. The investor protection objective of today's settlements will be poorly served if retail investors are ultimately shut out from participation in these products. Second, our process speaks volumes about our integrity as a regulator. Inviting people to come in and talk to us only to drag them through a difficult, lengthy, unproductive, and labyrinth regulatory process, cast the commission in a bad light, and thus makes us a less effective regulator. That's pretty crazy. This was on the SEC. Yeah, like, this is not honest. I'm literally quoting

somebody who works at the SEC. Third, and this is the last one, a company that tries to do the right thing should be met across the table by a regulator that tries to get it to a sensible result in a reasonable time frame. For the sake of the American public, our own reputation, and the companies that heed our call to come in and talk to us, we need to do better than we have so far at accommodating innovation through thoughtful use of the exemptive authority Congress gave us.

Jeez. I felt like a movie speech. That was my Independence Day speech. All right. Good for Hunter Pierce. Much needed. Yeah, I'm not moving assets out. I'm not that worried about it.

And I have moved money on and off the platform multiple times. They've done a very good job. It's like my Marcus account where if I move money out, it's there like the next business day. And even if I move a decent amount money out, not to brag. So obviously there was a lot of misinformation being spread on the internet. A well-known account posted that over-collateralized numbers and said,

there's no collateral. And it's like, whoa, no, that's not true at all. And so this is the problem with the internet as we well know, unfortunately, the disinformation, it spreads so quickly. And as an example, somebody tweeted about Peloton, the departing CEO, $119 million in stock sales. sales. Peloton's departing president, $105 million in stock sales, 2,800 laid off workers, complimentary Peloton memberships. And I get it. I get the injustice of it all. But the Peloton CEO. You think they got a free bike too? I hope they got a free bike to. And I believe founder of the

company, this is what it is. We should be rewarding these behaviors. Again, in the context of this, I understand the tweet. And I'm definitely sympathetic to the people that got laid off. But just Twitter and the internet is a powder keg. It sucks. The CEO didn't do anything wrong. He built a company, was selling his stock to get liquided like every other CEO founder has ever done. Diversification. And the business is going through a rough spell. This is what happens. Anyway, so what's going on with Peloton, Ben? I don't know what's going on. The new guy they brought in is like 69 years old. So it sounds to me like, no, this is a person you bring in to sell a company. You're not going to bring in some young energetics. They're going to sell the company, don't you think?

there's a really high probability that's going to happen. I see no other. So we spoke about Amazon. Amazon should sweep the floor and buy all the Peloton machines for 300 bucks. Yes, why not? And I'm sure people would sell them used too. I think I trust Amazon to do this. It makes sense. Are you still holding Zilla? I am. I'm a buying hold investor, Michael. This is one of the few quarter calls that I took a look at last week because I said, what happened? They had the store in the Wall Street Journal. They talked about it. They lost $881 million on their houses, which sounds like a lot of money because it is, but there's an average of like $25,000 in every home. Hold on, pause, pause. That's terrible. They lost 20. How? What? How? How do they do they do that?

How did they do that? This is the best real estate market to sell a house ever. How do you lose? I wonder, every buyer's like those idiots. Well, I'm sorry, every seller, every seller. I'm I know they sold a bunch of them like in bulk to some other institutional investors. So I wonder if they said, we're going to buy all these houses from you and make it easier and get them off your balance sheet, but you have to give us a discount. I don't know if that's what it is. But listen to this, though. This is from the report. Housing related transaction fees roughly $300 billion in 2021. This includes residential real estate, mortgages, rentals, title, escrow does not include stuff like renovations and home insurance. So there's- Hang on. We want to take this

over. Yes, in 2021. And so they're basically saying, we're going to create this super app that helps do all of this. And I think that sounds awesome because the Tam is huge. But I think they've shown the real estate market is impossible to take over at scale. This super app they want to do to handle all this stuff, it's probably not going to happen. So you're a seller? Revenue for the core segment of Zillow, based on home listings on its website rose 30% in 2021 compared to the previous year. Margins on that business were 45% up from 38%. Why don't they just stick to this same core business and not try to take over the whole real estate market? Because guess what? You just showed you cannot do that. I don't think anyone can do it, frankly. And obviously they, more than anyone who lost $25,000 per

house in the best sellers market in history. Maybe just pump the brakes and just do the core zillow part and have that be the business. What do I know? Well, it sounds like that's what they're doing, no? Well, no, they said they're going to create this super app that tries to be a realtor and refinance and title and escrow and mortgages and rentals and all. They still have this world domination thing. I don't know. So, Chipotle, what's going on with the stock? Chipotle had a good quarter, I think. Hey, do you know anyone who says Chipotle? No, I don't think I do. I've heard it. It's offensive.

It's like nails on a chalkboard for me. Chapulte. I can't take it. Anyway. Revenue of 22%. Comp stores or comp restaurants, I should say. 15%. Damn.

That's quarter over quarter? Pretty good. All right, digital sales. Now 42% of sales. So every time I walk in there, I used to be the only one who did the app and my food be waiting for me. No one orders from the counter anymore. It's all from the app and people just walk in.

and pick it up. It's like they have like an assembly line now where it's just people making to go orders. Frankly, that makes more sense because getting in line, people go, add a little bit more. I hate it. I get nervous. I get like embarrassed. I don't know why. But I feel like people are like judging you for what you order. Okay. So they raised prices. We had Sean, our new research channels, check this out for us. He said even though they raised prices and everything costs them much more, they're operating margin grew 5% year over year. Gross profit margins up 30% year over year. So all these companies complaining about higher costs of commodities and chicken and beef and all this stuff, they're doing just fine. Obviously, there's some companies that's impacting

a place like Topoli, not at all. Like I said, they're about to lose my business. I'm just saying. They didn't they have six more rate hikes for burrito bowls? They got another thing coming. Hey, can I do a humble brag here? Please. So when I order online, they have all these charities and it says, would you like to round up? And every time at, yeah, sure, I'll give 80 cents to whatever. I got an email saying that I was in the top 1% of all round up people in the country. for Chipotle customers. It's got to feel nice. I think what it really says

is that I eat Chipoli a lot. Why just survive back to school when you can thrive by creating a space that does it all for you, no matter the size. Whether you're taking over your parents' basement or moving to campus, IKEA has hundreds of design ideas

and affordable options to complement any budget. After all, you're in your small space era. It's time to own it. Shop now at IKEA.ca. So maybe that's it. All right, Disney. So we talked about Disney last week because I was there. And then what day did they announce?

Tuesday, I can't remember. All the days last week kind of rolled together. Everyone said, Ben kind of called it. Called what? The fact that Disney had a blowout quarter because of their park. So their park revenue was up 100% year over year, which for me to see, I think here's my call of the next six to nine months. If we don't get some other crazy wave, we're going to see a vacation boom unlike any we've ever seen in this country. So I went to Disney in the early February.

Kids are still in school. It's not spring break. It's usually a downtime at the park. It was hopping. We were getting alerts saying parks are at capacity. There are no more tickets for sale to get into the park. And of course, again, we pulled our kids from school for this. I might buy Disney.

On the artist call, they said international travelers, which were historically 18 to 20% of visitors, have yet to return. The one thing is we stayed at a Disney resort, and the resort actually still felt a little thin. And so I think people were staying off site and then coming to the park. But again, packed for a, I think spring break is going to be nuts. So we got back from Disney. We said, all right, we got the vacation it. That was our first vacation in like two years besides somewhere in Michigan. We want to go again. So we looked for spring break. Basically, the whole state of Florida is booked. We couldn't find anything for spring break. It's in like six or eight weeks,

so that kind of makes sense. But I think, yeah, they said that there's no international travelers yet. When that comes back, I think Disney, here's other thing. They have so many brands. We went to Hollywood Studios and Magic Kingdom and Epcot, which I'm going to rescind my Epcot. Epcot is great. Terrible take. But it's a good take if you have little kids. Epcot is not great for little kids. Wait, hold on.

I have a question. What's the place in Epcot? Is it like an innovation land or something like that? It's tomorrow land. Tomorrow land? Future land? Something like that, yeah. I mean, it's so funny because it looks all the future stuff from Epcot and Disney looks like

it future people thought 90s. I'm supposed to be going next year with my family in February break, though, because that's the only time Robin could take off. I'm nervous. Same time as it. So we went to Epcot. It rained. And I thought, okay, this sucks. It's raining. It's not very fun. But guess what? You can get a beer anywhere in Epcot. So what did I do? I started drinking. And I figured out something. I have the perfect number of beers during the day for a dad or a mom, for a parent. You can't have too many, right? Because you have to still care of kids. Three beers is the perfect amount of beers. Well, it depends what type of beers. Are you a Pilsner guy? I'm an IPA guy, so I can't have three. I could have two. I said we have from IPAs. But I can see how Epcot would be a blast if you were older without kids and did a food and drinking tour. I could see how that would be a lot of fun.

So I was wrong in Epcot. But again, totally packed. And I think we're going to see this. And you had to wear masks everywhere indoors at Disney. And so the COVID stuff, it was kind of annoying, whatever. I'm not going to even complain about masks. But I think people have just moved on. And I couldn't believe how packed it was.

So Disney had like amazing numbers. And here's the thing. They have so many brands. they don't even have a Marvel section of their parks yet. Oh, wow. How big is that going to... So, I'm not a Star Wars person at all. I think that it's the most overrated movie franchise.

Just stop. Just stop. Send me here. It is. From a movie perspective. Matthew, edit that out. Not from a pop culture, but from a movie perspective, I think they're overrated. But the Star Wars whole set of the park at Hollywood Studios was amazing. And my son, who's four, is a huge Star Wars guy now. They have their own lightsabers now.

He is huge into Star Wars. And I was like, okay, I kind of get it. And it made sense. Part of me respects the people that go to Disney every year, like as a tradition. Shout to Mike Antinelli. Part of me also thinks those people are insane because my wife and I said, we're not coming back here for years, if ever. It was like something we were glad we did.

And I got amazing memories from my kids and it got better as the week went along. But it's definitely overwhelming with people and lines and work. One final thing on Disney, though. I just mentioned I might buy it. I am a little bit nervous about the other side of the business. So traditional TV segments, ESPN and ABC, revenue fell 13%. Not great, and that's only going down. They should spin out ESPN, that's Mike.

And they spoke about the content spend. And the CEO said content, content, content. Like, they're trying to put out one new thing a week. I think they're on track to spend $33 billion in content. Well, they need to. So it sounds like their subscribers came in higher than expected. They're going to need to to get more people to join. This is the problem because Netflix is now on sort of on the other side of that

where I don't know how much more subscribers they can get. And now it's just a game of pumping out content. Like, how good a business is that? Good question. But that's the recurring revenue that they want, I'm sure. But what's interesting is that Disney is the stock is basically back to the levels of where it was before the pandemic. I don't know that sense. That's not interesting.

I'm sorry. No, that's a Disney Plus launch date. That's what I wanted to see. Okay, that is interesting. So Disney added this amazing business. And the stock's gone nowhere. Yeah. Kind of like your Netflix theory about how Netflix prices the same as it was in 2018.

I think last one, affirm. Oh, boy, this is hilarious. Hey, were we right or were we right about this? We said the buy now, pay later just doesn't make sense to us as a business. Is this too early of a victory? Credit to us. They tweeted another great quarter bubble, but whatever they tweeted, the stock was up 11%. Though, they tweeted the results early, though. That's the problem. And then they deleted the tweet and the stock crashed.

It was down like 30% after the tweet. Whoops. Someone's on LinkedIn looking for a new social media manager role at this point. Tough scene. The stock fell 20% or something. Well, yeah. Operating loss of $196 million compared to $26 million in the second quarter. Not great.

I don't get everything. I bought airline tickets the other day. We are going back to Florida. And you could use a firm to buy airline tickets like $49 a month to pay off airline tickets. I just don't. So here's the thing. We spoke about this with Twitter. And not that this is that big of a number.

I mean, well, actually it is a big number. how much they're spending to hire people and just stock-based compensation. One of the reasons why Twitter stock has gone nowhere is just they just keep diluting existing shareholders. $82 million in stock-based comp in the second quarter. Jeez, that'll do it. All right. This is from Barron's. Super Bowl Sunday, bettors are on track to wait your $7.6 billion on the game, up 80% from the year ago almost.

So they're showing these numbers like how legal sports gambling is now in 30 states. and the numbers are just growing by the day. I love sports gambling. It's all the best. But over the last year, Draft Kings and Penn are both down 60%. This is another reason buying stocks is hard. You see these numbers like sports gambling is going to be huge

and these sports gambling stocks are getting crushed. Same thing with when marijuana became legal. Everyone wants to buy the pot stocks. There's so much competition. The amount of incentives that these companies are giving out, they're just eating each other's lunch. By the way, not to brag, I bet pretty heavy on the Rams.

Just saying. I'm a diversified target date investor. And I bought last year the day they traded Stafford, I put $150 in the Rams win the Super Bowl. It would have paid out like $2,200. So I had to go into the game thinking I either win $2,200 or I lose it all. I talked about this on Spaces. Did you hedge? And I talked to you, I didn't know what to do.

So I could have bet the Bengals money line for like $750 would have given me a $1,200 turn. Essentially, I would have gotten $1,200 either way if I would have done that. And I hedged at halftime. I'm okay with that decision because the Bengals could have should have won. Oh, yeah, yeah. I'm okay with that decision. I was very nervous there for a little bit. Oh, I like the bills next year, seven to one odds.

I took some of my winnings, and I rolled it into the chiefs bills and maybe one other. I also like the Ravens as a long shot. I think they were 19 to one. Those kind of bets are kind of fun where you put it in and then you worry about it later. Okay. So this is something that's happening from the Fed, I guess, from them moving markets. This is from Freddie Mac. The 30-year fixed rate mortgage is now at 3.7%.

15 years almost at 3. These were like 2.7 and 2.2 in August. Did we refy at the bottom or did we refy at the bottom? them. Pretty darn close. If rising mortgage rates don't slow the housing market, I'm not sure what will. They will. You think so? I'm not so sure. It should in theory. I'm not so sure it will. But I think if this doesn't do it, I don't know what will. There is a level. I'm not saying that we're there right now, but there is a tipping point. I don't know where it is, but it's there. I wonder if it's more like four and a half or five as opposed to four. Could be. Because at the same point, like people still

our age, not your age, your old. People my age still need to buy houses. What it will do is it won't necessarily slow them down for moving. It'll just bring prices in, I hope. Maybe people use that as a way to negotiate because, hey, my monthly payment's going to be hired. I don't know if sellers will balk at that or not. They don't have a choice. Okay. Here's a good one on a home builders. That's a good listener question. Okay. Listener question, but an avid listener of your show, I know you guys are very well aware of the crazy hazy market. What has always been interesting to me is how much more rigorous process, the underrating process has been during this cycle versus what we saw in

2006, 2008. This leads me to believe that if the underwriting standards had just been tight, There just simply isn't enough supply in the market to meet demand, thus causing prices rise. If you guys notice the multiples at which home builders are trading, so KB, home is trading like seven times earnings, D.R. Horton at seven, Pulte homes at eight, M. My home is at four. What am I missing here? Why isn't this sector trading higher, given the market conditions to blah, blah, blah. So basically saying what's going on with home builders? Because it looks like they're 20% off the highs or so if you look at the ETFs. So do you have an explanation here? Yes, I do. I do. Investors are smart. Investors are smart. And they're realizing, rising mortgage rates, going to cool off demand, boom, I just cracked the code. No, honestly, I don't know.

I really don't know. Here's the other thing. I looked at from the bottom, they're up like almost 200%. They're outperforming a ton over the market. Don't get me that. Don't get me that. No, that's the best explanation for most things. Returns were pulled forward too much.

They got too high. Now they need to come in. This is, again, why stock picking is so hard because you look at the macro date and you go, the housing market is on fire. Why wouldn't these stocks be on fire as well? always line up exactly like that. So you had to buy them early to get those gains pretty much. Can I just say that as people that don't cover the housing industry, as analysts, there's probably a story here that we don't know about. I don't think it's just that stocks went up too

much. I'm sorry. I am a housing analyst at this point. I got an email from someone the other day saying, Ben, thank you. You are now my housing expert. So there. All right. Let's see. I got a couple of the things on Disney real quick, boom. Wait, wait, before we get to recommendations, They're just real quick two surveys. I just want to get these out of our dock. This is hilarious. I guess this survey was conducted by Bitcoin. 33% of Americans said they would be more likely to go on a date with someone who mentioned crypto assets in their online dating profile.

But that's only if your girlfriend lives in Canada. Does that count as a date? We watched the Tinder swindler over the weekend. Worth it? It was good enough. Here's a take I have. There's too many documentaries right now. I love documentaries.

I just never have in the time. I never watch them. I would rather watch a TV show or a movie than most documentaries. All right. The percentage of Americans who think their financial situation will worsen in the next 12 months, this is a really, really lousy chart. This is a really lousy chart. It's not good.

It's going in the wrong direction. It used to hover between, I don't know, 10 and 20 percent, and now it's just gone vertical. Definitely not what you want to say. So it's way higher now than it was even during COVID. So what I said earlier on the show about Americans being able to weather inflation better than the media is reporting. is negated by this chart, but I wonder what impact reporting has on consumer psychology. I still think it's watch what they do now what they say. People complain and then they still

spend. All right, recommendations. What do you got? Here's my recommendation for you in a crowd. What did you watch on the plane? Remember I told it. Both ways. Both ways. Okay. I did a bunch of reading. So I started reading the 90s by Chuck. Oh, how is it? It's very good. I mean, I love it. His opening chapter about how different life was in the 90s versus now. And I thought, like, I graduated college in 2004, so I graduated high school in 2000. That was basically one of the last groups of like pre-Facebook, pre-social media, pre-all this stuff. And it really was a different world. The way that he explains it, it's kind of like, oh, my gosh.

The point that we made a few months ago on a show was that like there's not going to be 2000s parties or 2010 parties in the future. Like there were for 90s, 80s, 60, 70s. He made a point about this that like the internet basically, the 90s is the last decade. So the internet just flashed. and everything. Do you remember waking up on a Saturday morning and literally like picking up the landline and dialing your friends to say, what are we doing today? Yes. And if you met somewhere, like you couldn't text to say, hey, I'm here. It was just like we hoped we found each other or- How did life function before cell phones? Like, I know we were alive, but I think we're all

just happier. You know what life was great in the 90s because I was 10 years old? That's why it was so great. Not too many worries. There's definitely a lot of nostalgia there that we're probably missing. There's a lot of stuff. All right, here's a recommendation for you if in big crowds. Follow someone like me. I realized that Disney, now we had strollers. I'm in the top 1% of walkers in a crowd. Is that possible? People move at different speeds. You were running back. So I was following the lead blocker. It was like I was following the left tackle pulling and that was a stroll. How do you find the left tackle? Oh, you follow a stroller? The stroller. Yes, the stroller. And I can maneuver in and out of crowds of people that move too slow. I'm in the top

1% of that. I'll give it to you. I'll just saying. All right. I started the new reacher show on Amazon and it shows how much I talk about this book because I think I've read all 25, 26 Reacher books that there are by Lee Child, not to brag. So I've spent a lot of hours with this character. They did the Tom Cruise movies. I didn't like him because it just felt too much like Tom Cruise and he was not anything like the character in the book. The show and I've gotten a lot of rave reviews from people saying you got to watch it. We're like two or three episodes in. I love it. They were so true to the character. I keep pausing and tell my wife like Oh, in the books, this is what I'm probably annoying her.

But I love it. Like the tone of it is perfect. The character, they get this huge buff ripped like 6-5 dude who looks kind of like Chris Pratt. And I absolutely love it. It's so good. It's on Amazon. I think it's probably better. It has a premium because I love the book so much, but I am enjoying it.

Can I get it the other side? I'm also watching it. And definitely gets a premium because you know the source material. But I'm enjoying it. It's mindless fun. It's not mentally taxing at all. It's very easy. and light and don't expect to be like a deep HP.

Yeah, it's not great, but it's certainly good enough. It's fun. Yes, I'm entertained. All right, finally, I enjoy the first few episodes of podcasts with celebrities that come out because then they get all their best friends to be on it. So the fly in the wall pod with David Spade and Dana Carvey is like behind the scenes of S&L. Talk about 90s. They had Chris Rock on.

They had Tom Hanks on and they just tell stories about hosting SNL and doing the skits. And I'm sure eventually it'll run out of steam a little bit, but right now I'm in now. I can't wait. All right. Good Rock. I will definitely listen to that. So I did a tour of duty. You know, I've been making the rounds.

I watched Apocalypse Now. You say I did a tour of duty? Yeah. I went to NAM this weekend. I watched Full Metal Jacket. And I would tell you something. I've seen the first hour of that movie. I don't know if the first half is an hour, but you know what I mean?

The private pilot part. I've seen that like half a dozen times and then I just always turn it off. To me, that's the movie. That's where it ends. So I did the back half? Very good. So you did Full Metal Jacket, Apocalypse Now. What was the other one?

Well, I said I do. Oh, I talk about Deer Hunter. Oh, I don't know if I necessarily to call this a tour because it's back in the States, but I watched Rambo. Okay. Have you ever seen Rambo? The first one is not what you'd think.

It's not like an action movie. It's kind of dark. Oh, it's action-packed. Well, okay, there's that, but it's not like you'd think like a 90s action movie or something because it came out in the 80s or 70s. It was 82. Was it 82?

I can't remember what year it was. But it's more of like a serious movie than like an over-the-top action film. Yes. So that was awesome. Oh, Tom Callahan? What's Tommy Boy's name? Tommy Boy's Dad was the bad guy.

1986, that's when that came out. Yeah, big time, Cal. So, but how is it possible, wait, I'm not done. How is it possible that I've never seen Rambo in full? I don't know. I mean, there was like six of them. And then lastly, I watched, this took multiple settings because it's a long movie. Dances with Wolves, finally.

I feel like that's been on my to-do list for like 20 years. Have you ever seen that movie? It's a great movie. Great movie. Seven Oscars, including Best Picture, Kevin Costner. It beat Ghost and Goodfellas. Kevin Costner also, you won't Best Director. Not a good movie. Not a good movie. A great movie.

I think Goodfellas has gotten better with age. But I think at the time, it probably wasn't the wrong choice at the time. I think O's the best picture. That gets my vote. So, all right. This blew me away. Somebody tweeted, Bruce Willis made eight garbage movies you've never heard of in 2021 alone. I know there's a story on this we talked about. I don't understand. I would love to know about his personal finances. Look at this. 2.5, 3.2, 3.2 out of 10 for the ratings. Just... Does he not have enough money? He must have a tax problem or something. Hello, I'm sorry, I do have one more thing. I've got to tell you this.

I went to the movies this week. Okay, what did you see? What do you think I saw? I'll just tell you. Nothing to leave you hanging. I saw Jackass. Oh, how was it? I love that show.

I used to love that show. And I went with my friend. We were the only two people in the theater, which is a real shame because there's nothing like laughing in a crowd. And I don't know if I'll ever laugh in a crowd ever again. So that show for us in college was appointment viewing. We would get together as a group and watch that show on Sunday nights or whenever it was on. I think those guys are groundbreaking in a lot of ways. The opening scene, I was absolutely

howling, howling, screaming and crying, like tears down my face laughing. Yes, okay. That probably would be good to go into theater. All right, lastly, lastly, what, you have anything else? No. All right, lastly. Let's talk about the best picture nominees. Okay. Oh, yeah, yeah, I want to do that. But lastly, somebody else tweeted, looking at the upcoming slate for Netflix original movies. I'm not going to read them to you because we'll just show you in show notes. What the hell is this nonsense? Are movies just, is this it? What are we looking at here? I think you got got got. Am I judging a book by a cover? Oh, these aren't real? There's no way. Oh, I got got got. You got, yeah, these are not real. These are,

but honestly, the fact that they got you on this, I got got it's like blimp the Hindenburg store with Bradley Cooper and Amanda's secret. These are fake, but. But it's representative of where we are. It wouldn't surprise me if it was real. I'll give you, yeah. Okay, so Calci. Death flow is definitely real. They do kind of, but chunnel with Daniel Craig and Aaron Eckhart and, yeah. So the best pictures this year, this is a travesty, an absolutely travesty.

So you can now bet on this on Calci. I'm going to put some bets here, but so I looked, they have every one on here. This has got to be the worst Oscar best picture lineup ever. Ever, ever. It's a travesty. Easily. So the power of the dog is now on Calci, the high, probability to win it's at 60 cents. The next one is

Belfast at 21%. Did you see that movie? I didn't realize, I've never heard of it before. It's on Netflix, and I've never even heard it. Yeah, it's what? It's Benedict Cumberbatch. Yeah, Dr. Strange. Yeah, yeah. Okay, I'm going to watch it, but I've never heard of it before. How is it on Netflix? I never saw it in like the top 10 or recommended or I've never, never even heard of this movie. You know what I bet on? I feel like this would be the trolleest thing ever. I love these odds. Don't look up to win best picture. 20 bucks to win 600. The thing is, the hard part about this is you bet on the one that you want to win

versus the one that will win based on the academy. Well, but I'm saying this would be the trolleest movie ever. If the academy if don't look up wins, everyone hated that movie. Not everyone, but like if that wins, it was a very politicized movie. So what else did I bet on? Oh, I bet on Dune winning Best Adapted Screenplay.

Okay. What's your inside knowledge there? I saw the movie. You can pronounce the director. You should bet on him for best director. Denyville knew. That's my edge. Actually, you know, I have to back Deneville New for Best director. Yeah, since you actually can pronounce his name better than anyone after seven. When are the Oscars?

This lineup sucks. It really is depressing looking at this lineup, but best picture. Did you see Coda? I liked Cota, but best picture, no. Nightmare Alley? Yeah, that was okay. That was one that I said this is for the Oscars. But I actually really liked Coda, but it's not like a best picture, that's for sure.

All right. That's a shame. Yeah, go to Kelsey. You can bet against us. I'll probably take the power of the dog. I'm going to watch it, and then I'm going to bet on it, Since it's the... You're going to bet on the favorite?

Still, it's 60 cents. That's not bad. No, all right. I'm going to watch it, too. All right, Animal Spirspot at gmail.com. Thank you for listening. We will see you next time.