Animal Spirits Podcast - Do We Need a Recession? (EP.45)

Episode Date: September 5, 2018

The FIRE movement, why you're paying so little for stuff, the private jet college tour, the new technology sector, bounties on new brokers, why celebrities are terrible with their money 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

Welcome to Animal Spirits, the podcast that takes a completely different look at markets and investing, hosted by Michael Batnick and Ben Carlson, two guys who study the markets as a passion and invest for all the right reasons. Michael Battenick and Ben Carlson work for Ritt Holt's wealth management. All opinions expressed by Michael and Ben or any podcast guests are solely their own opinions and do not reflect the opinion of Ritt Holt's wealth management. This podcast is for informational purposes only and should not be relied upon for investment decisions. Clients of Ritthold's wealth management may maintain positions in the securities

discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. There was an article over the weekend. This is a bit of a hot topic these days. How to retire in your 30s with $1 million in the bank from the New York Times. So there's this thing called the fire movement. I think we probably spoke about in the past. Ben, what are your thoughts on this thing going on? Right. So fire means financial independence retire early. And I think that Mr. Money Mustache guy was the one who really started this whole movement, or at least he's the most high profile one. But the idea is to save a huge percentage of your income at a young age and retire and live off of not much money. So I think people save upwards of 70 to 80% of their income

and they spend very little. And the idea is if you can do that, you can, if you're saving enough, you can just take yourself out of the job. And if you have such a low lifestyle, then there's not much to replace there. I think in one respect, you have to like, you have to appreciate what these people are doing in a lot of ways because so many people are so bad with their finances, the fact that these people are so disciplined, you almost have to like give a, you know, hat tip to that. But on the other hand, I think a lot of this just revolves around people that hate their jobs, don't you? Like a lot of the people who, when you read these stories, they just hate their job and they want to just basically do something else.

Yes, I completely agree. And before we get into this, I think this is a topic that people feel passionately about and we're just giving our opinions. I don't think that this is like good or bad. This is obviously a personal choice. And I think that people should be allowed to do whatever they want. So these are just my opinions. An interesting quote in here was somebody in the article said, to go to a job that's making you miserable every day, it doesn't make sense to pay the bank account at that point. And I would agree with that. If you're in a decently high-paying job and you're just miserable, why wouldn't you just get a different job? Yeah, this is, and I think a lot of it comes down to people just not wanting to work for someone else. I think maybe a lot of

it is someone just wants to go on their own. And what you've seen a lot of these cases is the people that you read the stories about have just turned into, like, lifestyle bloggers, and that's their new job. So they say they're retired, but really they've just moved into the publishing industry, and they're full-time bloggers now. So I think in a lot of ways it's just getting to the point of doing what you want and having no one looking over your shoulder, telling you what to do. I mean, again, I think a lot of the fact that these people are able to live on so little and be so frugal, I think you have to respect that in a lot of ways. But in other ways, I think it's going to be interesting to see what happens on the other side of things because

stocks are up nine or ten years in a row. A lot of these people have been saving for that long. Maybe they started saving during a financial crisis. But when you run through the research reports and the studies on like the 4% rule, which is what a lot of these people are using, those studies aren't meant for people in their 30s. Like if you save a million dollars and live on 4%, that's supposed to be for people in retirement, not for people in their 30s who want to then have this money less than their entire life. So I think a lot of these people could be in for a rude awakening. Maybe their frugal lifestyle will help, but I think a lot of them are going to probably have to go back and get a job if things don't work out the way they plan.

One of the people in this article said that he has two daughters and a wife, and they spend $40,000 a year, or the plan is to spend $40,000 a year generated from investments. So it's a life rich on time but short on luxuries. And that's not necessarily a lifestyle that I would want to live, but for people that chooses, that's obviously something that they enjoy. I do wonder if this is something that it's more of a reset, and I wonder after 10 years these people get a different job. Maybe that's the whole point of it is not financial freedom, but freedom to do what you want. Because a lot of people still are technically working. They're not really retired. And in many cases, they have a spouse that's still working

because they need health coverage. There's a lot of different things you have to consider when thinking through this. But it is interesting, like the dichotomy between people like this who are so extreme and save so much and people on the other end that don't save anything. I'm more of a balanced person that wants stuff in the middle where I do like to spend on certain things in concert with a good saving plan. But I'm kind of like you. I would never be able to take it this far, especially with a family. I think it's kind of, it's really almost impossible. But I say kudos to these people who, if that's the way they want to live their life, you know, go for it. Yeah. One, One of the things that I think gets people sort of laughing or poking fun at this is like the articles don't really do them any favors.

So, for instance, even with those lifestyle cuts, the couple couldn't increase their savings rate substantially unless they relocated to a cheaper community, a delveraging tactic that the fire crowd calls, quote, arbitrage. So they made up, they made up that word, huh? Yeah. So not exactly what arbitrage is. But speaking of moving to cheaper cities, there was a tweet from, I'm not sure this is by Rosenberg. and he said, updated salary needed to buy the median home by metro area. And it's just, it's wild, how expensive it is to live in major metropolitan areas. So San Jose, 275K, San Francisco, 215, San Diego 130, L.A. 115, Boston, 109, etc.

It is really, really expensive to be a homeowner. There was a survey the other day I saw on Twitter that said something like 46% of people in California would like to move out of California just because of the cost of living. But yeah, this is pretty interesting. So when you see things like aggregate data on saving or income or whatever, it almost needs some context behind like how far is that going to get you depending on where you live. And yeah, obviously, Sam, and anything in the West Coast looks pretty high in this chart. Yeah.

So somebody tweeted over the weekend, somebody, Val Fixer, I thought that's kind of funny. Why does everyone congratulate people when they buy a house and buy as in quotes? In most cases, the buyer has simply acquired a minority stake in a real estate. venture with a bank where they have to pay all operating costs and bear the market risk. That's not bad. This is one of the reasons that I think people always argue, like, is real estate an asset or is an investment? I think it's almost like a form of consumption. So like if you're renting or buying, you're consuming real estate because it's part of it's where you live. So I think it's almost, it's neither an investment or an asset. It's kind of

just something that you're forced to spend money on. Yeah. So an article over the weekend in the journal, am I paying too little for stuff? And this person spoke about. something called Meal Pal, which is a restaurant that offers one dish a day for 639. And then he tied that into other things like Uber Pool and movie pass and how you can get a free trial for basically everything these days. By the way, the meal pal thing was you pay 639 for lunch that cost $11.50 on the menu. So this is like the movie pass of restaurants. Is that it?

I guess. And it just goes to like what sort of environment we're in with cheap money and obviously a good economic backdrop. And a quote from the article is, to grow, companies need to stand out in some way, said Robert Dolan, a professor at Harvard Business School. There's so much emphasis on growing their user base. All other considerations fade away. This kind of gets back to our talk with Morgan from a few weeks ago about there's just so much money in the private space these days that it's almost like a lot of these companies are being subsidized to see if they can grow their user base. And I think a lot of it is, everyone wants to be Amazon or Netflix or whatever and have

that scale or Spotify, but a lot of these ideas here just seem like there's no way it's ever going to happen. So a lot of these ideas that are subsidized by VCs are subsidized by investors who will probably not have great returns when you're just throwing money against ideas like this. Pretty much. So are you saying that this is a headline that we see in the 22nd inning or the 23rd inning? Yeah, pretty much. So we spoke about the athletic a few weeks ago and same idea. They raised $28 million from venture capitalists, and they are spraying it all over the place. Now, I think it's a good idea, but whether it turns into a profitable business, I guess, is sort of besides a point at these early innings.

Right. People just want to try to get as many people signed up as they can on the services and hope that everything else, all the profits and stuff come in later. But it will be interesting to see when the VCs decide to put some pressure on these companies, or do they just say eventually one of these is going to work out in the other 10 that don't, we don't care. So, yeah, I don't know how that all that all rectifies in the end. So there was an article in Axial saying how the lower middle market is too hot to touch. And I don't know which part of the market this is in, but somebody sent us an article showing

that people are now traveling across the country in private jets to take trips of different college campuses. So that's probably what, 27th inning stuff? It was funny because they said that the average package can top like $30,000 a trip, which, or six figures in some cases, which is basically the price tag of college that a lot of people have a hard time saving and going into loans. So, yeah, this is not a very good one for people who are arguing that inequality is not a problem, I suppose. Yeah, this is a great quote from somebody named Abby Siegel who works for one of these companies. She's a New York College Entrance consultant. And she said, as a neutral party, I can be extremely helpful.

If it comes out of my mouth, the children will listen, where they might not listen to the parents. Okay. So if the private jet doesn't sway you, then she will be the one that tells them where to go? I just, man. Yeah. So have you ever heard of a company called, well, probably not because you're not a coffee drinker, but have you ever heard of Costa coffee or Costa coffee? No.

Yeah. So I don't nothing about coffee. Okay. So I've never heard of this company, but apparently it's a big deal. Coca-Cola is buying it for five. billion dollars. This company has nearly 4,000 stores in 32 countries. And similarly, Pepsi also just bought soda stream. You're not a soda drink either, are you? Pop. Yeah, we call it pop in the Midwest. I used to have one of the soda stream things. I can't believe that it survived as a company for that long.

It's basically the thing that you put carbonation into the bottles, right? It sounds like a stock I definitely would have shorted. Right. And it was like $3 billion. So the point here is that these companies are just flushing cash and spending on everything, which kind of gets to a point about the lack of public companies. I think these large companies have so much cash at their disposal that we're just seeing so much money in like the M&A game. So that's part of the reason that we just have such fewer companies in the stock market now. Have you heard about Tilray? No, you're testing my knowledge of companies here today. So this is quite a lead from Bloomberg. Tilray Inc. sold less than $10 million worth of cannabis in the second quarter. Its market

value is approaching five billion dollars. So this is a cannabis firm? Yes, but we're in the first ending of the cannabis explosion. By the way, so it's all good. I feel like cannabis is definitely the highbrow way to say this instead of like a weed or potstock. It's cannabis. But also, Tilray definitely sounds like the name of a company that was that someone came up with when they were high. Correct? Correct. Yeah. Let's call it Tilray. And even, I don't care how high I was, I would still not eat this. China, or Mondal is in China, plans to offer Orioles. Okay. Okay. Two different new flavors.

Hot chicken wing and wasabi flavors. Gross. See, this is another thing that's not made for me because I can't do spicy stuff very well, but no thanks. That sounds awful. That's pretty bad. So we've now moved into the 30th ending then. Yeah. Well, let's shift gears.

Let's talk about the sector shakeup. Okay. So one of the big news in terms of index providers is that some of the index providers in S&P are changing the way that they do their, so it's called the global industry classification system or GICS. This is kind of some nerdy behind the scene stuff, but basically it's the way they classify different sectors. And what they're doing is breaking out technology and communication sectors. And so it's kind of hard for them to really pinpoint what places like Google and Amazon and Apple and Facebook look like. So they're breaking them up into a technology and a

communications sector. Is that correct? Yeah, I liked what I shares did. I think we spoke about this a few months ago on the show, how they are coming up with new ETFs that have part of Amazon in one and part of Amazon and another because is Amazon a retailer? Is it a technology company? Obviously, AWS is a huge part of its business. So this is a big deal in certain circles. For us, it's not so much of a big deal, but for people that manage money specifically in sector rotation strategies, this really throws a monkey wrench into the back test. So Barron's has a good chart on this and they show that before the technology, information technology sector would have close to 16% of Apple and also Google and Facebook.

And then in the new shakeup, Google and Facebook will be going to the communication sector and Apple and I'll make up 20%. And in the grand scheme of things, this doesn't matter that much to most investors. The people it doesn't matter for are those who invest in these sector ETFs or maybe like a sector rotation fund because any and all back tests completely get thrown out the window, which they probably should anyway because frankly the sectors have evolved so much over time that it's hard to, I think, play this way. But for those who are in those individual ETFs, it's going to make things a little different. I feel like you weren't listening to me, which is fair. But you just repeated what I said. Seriously. It happens. So, yeah, what is

interesting is that the new communications service sector is going to be 50% Facebook and Google. And Ben, are you listening? What's that? So Amazon and the consumer discretionary is going from 28%? up to 35%. But I think you can also make the argument that Apple should be in consumer discretionary in a lot of ways?

Absolutely, absolutely. So, yeah, so again, it's hard to really, and especially when these companies, I think Amazon today became the second company to hit a trillion dollar market cap. Like, when you're that large of a company,

it's going to be hard to put you into one specific box, right? You can make the case that Apple is an energy company. Why? No, that was a stretch. But so there are $500 billion in sector ETF. So it's certainly a big deal within the industry for certain people.

Yeah, I would never, I don't know, I think, I think sector ETS probably do make it easy for people that want to trade stocks and want to trade on a theme instead of picking an individual stock. But yeah, this kind of adds a little bit of monkey wrench into that idea. Speaking of busted back tests, so trans America is settling with the SEC for misleading investors for $97 million. And question, do you know, where does this money go? and they have to pay the fine? Yeah. No clue.

I assume it's part of it paid out to the investors, but I honestly have no idea. I have a pretty good idea, I think. Okay, let's hear it. What if this just went to pensions? Boom. Crisis over. All right. Probably goes straight into the Federal Reserve's assets and it manipulates a stock market,

but I'm not sure. So what exactly did they do? This is pretty wild. According to the SEC, the quantitative models had been developed by a junior analyst with no experience in portfolio management or formal training in financial modeling. Whoops. That kind of hurts. And so these two guys, Paul Sankan and Paul Johnson, wrote a blog post talking about the performance.

And one of the amazing things is that I think this was in like, this was right down the middle of performance. I think it was like in the 50 percentile, something like that. So they wrote, wait a second, the TTI fund was managed by someone without experience and contained numerous emers, but it outperformed half of the funds in the category. Who was managing the funds that perform worse? Presumably, they were run by people who were competent and, knew or thought they knew what they were doing. What kind of models were they using for question marks? I find that shocking. Like the realization that the proverbial monkey throwing darts had a page

of the newspaper will pick stocks better than professional. Not good news for active management. So this place wasn't just fine for, it was just for misleading. It wasn't for like they made up anything. They actually did perform okay. Correct. It was not like a colossal blowup, I don't think. Wow. That would be a good, that would be a pretty good game. Just take like five people off the street and see if they could come up with a better quantitative model than the current mutual funds have right now? Buy stocks that start with the letter A. Pretty much.

That is pretty bizarre. Okay. So there was a piece in advisor hub this week that you pointed me to that Merrill Lynch is now offering bounties for recruiting novice brokers. And they are paying up to $25,000 for people that will join their new program as a broker. So do you take this to mean that they're having trouble recruiting? talent, or are they just trying to get younger in their ranks? Or what's the story here? Both. This is kind of wild that they're so starved for young future advisors. What was interesting

is that a lot of these people are being driven over to Merrill Edge, which has 2,600 financial solution advisors, as they call it, up from just 466 12 months earlier. But I can't imagine that they're paying 25 grand for advisors to join this, right? That would make sense. No, unless they came with a big business. Because this is a very, right? This is a very, right, a low-margin business. But I mean, it makes sense when I think that Cirulian associates, they quote here, they've talked about like the average advisors in their mid to late 50s, and most of them have no contingency plan whatsoever. So I think the numbers are like 100,000 advisors out of the 300,000 are going to be retiring in the next, you know,

decade or so. So trying to get younger, I mean, it definitely makes sense, especially if they put them through some sort of training program. We have a lot of people who ask us through emails and such, like, what should I do if I want to break into an RIA? And that's really tough, especially as a young person with a little experience. And I think for a lot of people, that means going to a bigger place like this and going through this type of training program and learning the ropes a little bit and then breaking off to a smaller place. Yeah, it's tough because RAs just don't have the war chest of cash like wirehouses do. Right. But then, of course, wirehouses are probably on the wrong side of this business. I mean, obviously, there's

still trillions and trillions of dollars there. Kits has said that I think Morgan Stanley and UBS each have more money than all of the RAA assets on TD Ameritrade, Fidelity, and Shrop's platform combined. Right. I mean, they have trillions of dollars combined. So yeah, it is still an uphill battle for the independence. And I think a lot of people still just latch on to those those brands and those names on the door. So Prince died a year ago, or is it more? Sounds about right. And he died without a will.

I don't really know what's going on with this estate. I haven't heard much. But we found out similarly that Aretha Franklin just left behind $80 million also without an estate. It is kind of amazing. You see these stories every single time a famous person dies, correct? It does seem that way. I mean, it's like it's constant, it's like constant headlines for market. watch. I feel like every time it'll be like famous person dies did not have a will. So I was listening

to a podcast with Dex Shepherd and Seth Rogen a few weeks ago. And that's actually not a bad podcast because Dex Shepard is the guy from Pongton. He's been in a number of movies and he just kind of interviews his friends and it's kind of a good time waste your podcast for me where a lot of the kind of like Mark Merrin where the celebrities kind of open up. But Seth Rogen had said, he asked him, you know, what do you do with your money? Have you ever had your money person audited And Rogan said, I know nothing about this stuff. He's like, if there's ever going to be like a fraud that happens, I'm going to be one of the people that gets taken under.

So I feel like a lot of these celebrities just don't, they assume they have so much money that it probably doesn't matter. And so I think a lot of them just don't pay attention to what's going on with their money, which is a lot of why a lot of them end up in getting scammed. So this isn't necessarily a will issue, but I don't know if she had life insurance. So her estate tax is going to be $27.5 million. And she had no plans on that money. That's pretty amazing that no tax person or financial advisor ever pulled her aside and said,

we need to figure this out. But again, I think a lot of times people just tell them what they want to hear. And that's, again, why these people get taken advantage of. And one of her kids is special needs and there's other financial complications that goes along with that. So, yeah, it is always surprising when you see stories like this. It's like, how could you be so irresponsible financial? it's just yeah that's tough especially with that much money it's almost like you don't you don't think about it okay let's get to a couple questions we get called out in our first question so it says

your podcast is a must as a must listen for me but i can tell how young both of you are because you did not experience past economic and political periods i can tell you that the 1970s were far worse than the great recession of 2008 i would much prefer to have the band-aid being ripped off and then trying to slowly remove it the decade of the 70s were terrible both financially and economically i graduated of college in 1975, and not one of my friends got a job in the area of their studies. So what say you on this? Okay. I mean, I think this is a fair point because obviously the economic implications of the stock market crash was worse than 2008. But think about the recovery. Young people, maybe not until like sort of recently, have had an okay time getting a job.

Whereas in the 1970s, it was just so long. It was 16 years of sideways movement in the market with some crashes between it. I just wrote a recent piece about this, the forgotten bear market. And I don't remember exactly the statistics that I cited, but the crash of 69 into 70 70 was pretty brutal. Yeah, and the 73, 74 bear market. I think part of this really, it shows like when you're young, it's going to have a huge impression on your memory, in your market memory. So I think the young people who went through 2008, that's going to leave a huge impression on them, just like the young people who went through the Great Depression, it left an impression on them. So the fact that this reader or listener went through the 1970s and said it was worse for them,

I think that has a lot to do with where they were at that time because no one knew that the band-aid was going to be ripped off so quickly in 2008 and things were going to come back. So at the time, that uncertainty still lurks. And so I wrote a piece a few years ago talking about, you know, was the 1962 to 1982, was it as bad as people think? Because that's when the Dow basically went nowhere for, what was it, 16 years or whatever, I guess. Yeah. And real returns were awful. And part of the reason was because inflation was so high. And so on a real, so actually the market was up like 7% nominally, but 0% on a real basis because inflation just killed your return. But the one thing I did

find in that period, from 1966 to 1982, wage growth was over 3%. 300% in total in like almost 9% a year. So from that perspective, inflation actually helped a little bit because people were making more money. So I kind of looked to look at both sides of this deal. So obviously it was tough in certain areas and things cost more, but people actually started getting paid more, which is something that people that we're dealing with now where wages aren't going up.

So I don't know. I always like to look at both sides of this, but I think a lot of it has to do with where you were at in your career and how these financial crises really impact you. I also wonder if we're falling prey to looking at stock charts and come into like conclusions about real life matters, you know? Yes, that's fair. Yeah. And at the time, yes, I've talked to my friends in the past about if you held your, kept your

job through the 2008 crisis and continued to put money away, it didn't really feel that bad to you. But if you were one of these people who lost their job and you had a hard time getting another one, then of course, that felt like the worst thing in the world to you. So yeah, it's a very financial crisis can be very personal. Okay, here's another one. I need once and for all for all the zero-sum thesis to be settled. I've heard many people say that the market is zero-sum.

If I buy a stock at 75 and sell it two at 100, and you go on to sell it at 150, who loses? So in the fullness of time, if markets tend to go up, surely zero-sum does not apply in a healthy economy and market. I would love to hear your thoughts. I think that the zero-sum really applies to active management, that gross of fees, every winner is offset by a loser, and the net of fees, on average, the active manager has to lose. I don't, I mean, I understand

his example, but I think that that's like just too clean of an argument. It doesn't really work that way. And also, if you're talking about the stock market in the fact that it goes up over time, that's the overall market. That's not individual stocks. So if you look at the numbers for individual stocks, that one study from Longboard funds showed that, you know, a very small percentage of stocks had the biggest overall waiting on the winning. So the majority of stocks end up losing. What is it? Like 60% of all stocks underperform or go to zero or something? I think two-thirds of all stocks underperform their benchmark. That's right. Unperform the index. So if you're looking at just on an individual stock basis, then it's not really zero-sum

from that perspective because most stocks are going to end up being losers. It's kind of the 80-20 rule where 20% of the stocks probably lead to 80% of the gains or whatever. So yeah, I think the zero-sum is more dealing with, I agree, active managers and the fact that there's a loser for every winner overall. Okay, any good recommendations this week? So I told you to listen to Coach Raffling with Tim Ferriss, and I had never heard of him, but what sprung to mind was he, if you've seen the Dream Team documentary, which is on NBA TV like all the time, he was the coach for the college kids when they played the Dream Team. So I know Bobby Harley was on that team. I don't know who else. Oh, Jamal Mashburn, I think. And I think they beat the Dream Team and then

they played again and they went nine minutes without scoring a single basket. So he was the coach of that team. But he just told some incredible, incredible stories about Martin Luther King and his time at Nike. And it was just really, really, really, really special. His stuff as he's 80, I think he said he's around 80 years old. And he said all the people he hangs out with are younger. And I thought that was kind of interesting because he said he doesn't want his brain to like atrophy. And I think that that's kind of an interesting way to look at the world when you age. Like, I can't ever really see myself just sitting on a beach and doing nothing. I think you always have to do something to like keep your brain.

brain active and especially at that age. So that was that was kind of an interesting lesson for me of talking to young people and figuring out what exactly is going on in the world with with young people and new ideas. So this guy's a fern, financially independent, retire, never. You just come up with that? Did you listen to the hot hand fallacy with AQR? Not yet. Okay, so they're talking a lot about gambler's fallacy and mean reversion and Amos Dversky said I've had this conversation a thousand times. I've one of all but convinced nobody that the hot hand fallacy is a fallacy, that it doesn't exist.

But I think that this is one of those things where sampling has a huge issue. And like in my mind, I cannot be convinced. Data cannot convince me that there are not streaky shooters in the NBA. And I think that if you measure like, you know, if you include like power forwards in the mix or Big Man and maybe muddies the data, but for sure, J.R. Smith is a streaky shooter. Steph Curry, Clay, like these guys do get hot and cold. Yes. John Stark's for your New York Knicks was the one that comes to mind for me. Yeah, I agree that you can't, this is one of those behavioral studies like loss aversion that you can't, like the studies don't do it justice, I feel like it. Yeah. What's the line like some things that. Not everything. Not everything. Yeah. You say. Go on. Not everything like we counted counts and not everything that counts can be counted or something. Exactly. I think this falls directly into that pile.

Do we just quote Einstein there? Something like that. All right. What else do I got? So I have. 50 pages to go. This is a really long book, but really, really, really good. Barbarians at the gate. You ever read it? No, I never got to me. Okay. So there's just, I think one of the things I made this a little bit tricky was there's so many characters, but it was like a really, really in-depth look at RJ Nabisco, which was a cash cow. It was a tobacco company that was throwing off gazillions and dollars of free cash flow. But it was valued like a tobacco company. There was a lot of political pressure going on. So it wasn't getting, it's multiple was depressed. And so they had companies in there like Del Monte and Nabisco. And so this was one of those

companies that was obviously worth more broken up. So all the vultures came in and tried to get involved in the deal. And it was just really, really, really good. Highly, highly, highly recommend. Okay. Lastly, there was an article over the weekend that Bethany wrote, in the New York Times, Bethany McLean wrote in the New York Times, the next financial crisis lurks underground, fueled by debt and years of easy credit, America's energy boom is on shaky footing. So she took a little bit of blowback for this, and I think that what happened here, it was really a case of the headline not matching up with the meat of the article.

And not that she meets my defense, but the book was awesome. And the Federal Reserve and the cheap money was probably a footnote, maybe a little bit more than that, but it certainly wasn't like the whole story of the book. And I will say that I'll defend her on the headline thing because when I wrote the stuff for Bloomberg, like you have, as a writer, you have no say in the headline. They write a headline to try to get people to read. And a lot of times the stuff that I would write, I would send it to you, I'd say, look at the headline and look at what I wrote and it doesn't match it all. So I agree that once you read the piece, it's not exactly coming out what's the tension-grabbing headline says. And then lastly, I saw the Meg again and it was much better the second time. you know what, you're probably serious and I wouldn't doubt it. Okay, so I got into, it took me a long time and people have been recommending this for a while. I got into Peaky Blinders on Netflix. Did you ever watch this one? No, Josh always talks about that though. I'm, it took me, it's about, it's, it's only six

episode seasons and I think they've had four seasons. It took me two or three episodes to get into it, where I thought like, this isn't that great and people are talking about it. But then by the end of the first season, I was hooked. I'm halfway through the second season. It's like a mobster one from the early 1900s it's really good hold on question how long are the episodes they're an hour each and i didn't i didn't realize tom hardy actually has a guest starring role in the second season so it's you're not going to see van amaria that went okay maybe that's when it comes to hbio i'll watch it how's that sound okay i won't go to the theater uh we also started watching the sinner on netflix with jessica beale i think a second season just came out it's like a crime drama but it gets into like the

psychology of why people will do a crime and it's it's really good so far Robin loves that show. I think she watched the second season. But for some reason, I'm a USA snob. Yeah, I can see that. I just think about like MacGyver and Baywatch. And not that I mean, I like those as a kid. I don't know. I just, I'm anti-USA, maybe unfairly. I was surprised to see that's where it came from. But I'm, I'm agnostic for where my entertainment comes from these days. I also read the girl who takes an eye for an eye, which is the second follow-up from a new author who started. Did you ever read The Girl with a Dragon Tattoo? Yes. I love that series. movie. I love that series too. So the guy who wrote it, Steve Larson, he died, and then another author picked up the story, which has to be very, like, a lot of pressure. So this other guy picked it up, and he wrote one a couple years ago, and then this is the second follow-up. And

actually, they've both been really good, surprisingly. I heard bad things about the first one, I think. I liked it. I thought it was interesting. And so... Is it the same character? What's her name? Yeah, Elizabeth Salander. Yeah. And it's all the same characters. And he picks up a story and I thought he did a really good job of keeping it going because when you get to a fourth or fifth book, it's kind of tough. And I finally finished the geometry of wealth from Brian Portnoy, which you've talked about before. I thought it's kind of more of a philosophy book, which when you talk about finances is probably what a lot of people need. But I thought his graph on risk versus reward was one of the best ones I've ever seen where he shows as reward goes up,

your range of outcomes just gets wider. And so the hair, it was perfect. So I'll put that in the show notes. It was really good. that because somebody tweeted this and then it sort of blew up and Brian was like just an FYI I took this from somebody so right which makes sense yeah there's probably nothing new in terms of this realm but it was I've never seen it like that before yeah really good yep okay that's all I got send us an email anal spirits pod at gmail.com and we will talk to you next week