Animal Spirits Podcast - Eff You Money (EP.391)

Episode Date: December 18, 2024

On episode 391 of Animal Spirits, Michael Batnick and Ben Carlson discuss: the prospects for another 20% year in the stock market in 2025, the U.S. economy is firing on all cylinders, no one is predicting a recession anymore, Hussman is still predicting a crash, why retail traders underperform, chart crimes, when money becomes a liability, when middle age hits, and more! This episode is sponsored by Westwood. Rethink how you approach energy investing and learn more at: westwoodgroup.com Animal Spirits survey: https://www.surveymonkey.com/r/ZBBJ69Q Sign up for The Compound newsletter and never miss out: thecompoundnews.com/subscribe Subscribe to The Unlock newsletter: https://www.advisorunlock.com/subscribe Find complete show notes on our blogs: Ben Carlson’s A Wealth of Common Sense Michael Batnick’s The Irrelevant Investor Feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation. Public disclosure: A Bond Account is a self-directed brokerage account with Public Investing, member FINRA/SIPC. Deposits into this account are used to purchase 10 investment-grade and high-yield bonds. As of 9/26/24, the average, annualized yield to worst (YTW) across the Bond Account is greater than 6%. A bond’s yield is a function of its market price, which can fluctuate; therefore, a bond’s YTW is not “locked in” until the bond is purchased, and your yield at time of purchase may be different from the yield shown here. The “locked in” YTW is not guaranteed; you may receive less than the YTW of the bonds in the Bond Account if you sell any of the bonds before maturity or if the issuer defaults on the bond. Public Investing charges a markup on each bond trade. See our Fee Schedule. Bond Accounts are not recommendations of individual bonds or default allocations. The bonds in the Bond Account have not been selected based on your needs or risk profile. See https://public.com/disclosures/bond-account to learn more.   Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Ben Carlson are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. The Compound Media, Incorporated, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. For additional advertisement disclaimers see here https://ritholtzwealth.com/advertising-disclaimers. Investments in securities involve the risk of loss. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. The information provided on this website (including any information that may be accessed through this website) is not directed at any investor or category of investors and is provided solely as general information. Obviously nothing on this channel should be considered as personalized financial advice or a solicitation to buy or sell any securities. See our disclosures here: https://ritholtzwealth.com/podcast-youtube-disclosures/ Learn more about your ad choices. Visit megaphone.fm/adchoices

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It's time to rethink how you approach energy investing. Visit westwood group.com to learn more. Investing involves risk, including the possible loss of principle. Carefully consider investment objectives, risks, charges, and expenses before investing, visit westwoodetefs.com to learn more. 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. All opinions expressed by Michael and Ben are solely their own opinion and do not reflect the opinion of Ridholt's wealth management.

This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Ridholt's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. Ben, how are you? This is my favorite month of the year between Christmas and Thanksgiving and Christmas.

I think you can make the claim it's the best month of the year. December. For vibes. I don't think you can. It's just, I don't know, I feel like the vibes around the holidays are immaculate. Yeah, they're good. Everyone's in a good mood. People are eating and drinking and gifting and it's slow at work and people are, you know,

circling back in the end of the year. It's just, it's a great time of the year. Yeah, I'll buy that. I don't know if it's the best month of the year, but it's top 12 for sure. Ben, you tweeted, I'm sorry, you Skyed, you Blue Skyed. Did you tweet this as well? Are you double-dipping, son of a bitch? I try not to, occasionally I will, to test it out.

Is Blue Sky like where you do like a little bit of, like, your work? You're like a comic going, trying some new material? Yes, that's where I put out the, like, instead of the draft folder on Twitter, it's like, ah, just put it on Blue Sky and see what happens. Because they don't have a draft folder there yet. So I do notice that, so the thing that's really annoying to me about Twitter is I see all these people write a whole paragraph, and then they say link in the next tweet. And that's just annoying.

I feel like the links actually do sometimes do better on Blue Sky, which is kind of annoying. Okay. What are you going to do? As a content creator. So Ben Skide, 2021, recession is coming. 2022, 100% chance of a recession. 2023, we are probably already in a recession. 24, we have to have a recession eventually, right?

2025. What if we just don't have another recession this decade? And that's not too far off. It kind of feels like that, right? I feel like the recession predictions have completely gone away. Oh, they did. No, they have. I saw, I saw Jeffrey Kleintop tweeted a chart of the number of countries where economists expect there to be a recession next year hit zero. Wow. Wow. You. Even around the world? Yeah. Holy cow. Okay.

So it's come completely full circle. And we've, you and I have thrown this out there a little bit. Like, what if we just don't have one for a while? And now it feels like that's just becoming almost consensus. It is consensus. Yeah, yeah. No, I don't think, I don't think anybody's expecting recession in 2025. So you and Josh talked to Rick Reader from BlackRock, and he talked about this.

And Josh has been throwing out this idea. And so is Rick that it just the whole economy has changed. And it feels weird saying this because it feels like permanent plateau-ish. But what if things just are completely different in our economy? Well, there's no what if. Things are completely different. I guess the question is, what are the implications for that? And I didn't get to, I didn't have a chance to say this because we only had a limited time with Rick.

But just because the business cycle is not going to be prone to booms and busts of the past because of the physical to digital transformation of our economy, the booms and the buzz of the inventory buildup, like that's over. definitely does not mean that there can't be recessions or bare markets. I think a great example is Netflix. Netflix was in a huge recession, right? And that is like still, is there any stock that is more consumer staple, less prone to booms and buffs?

But it was a growth stock. They stopped growing. They had to change their strategy. They got whacked. The stock felt like 75%. So I don't think Rick would say, I don't want to put words in his mouth, but I'll say that just because I think that the booms and bus cycles are going to be different than the past, I definitely do not think that bare markets are going to go away, cyclical and

secular. Like, I 100% believe that that's still a thing, just to be very, very clear. And we just had a bear market, not that long ago. But I think the recession thing that this century alone, we've had the fewest recessions of, I mean, they're being more and more spread out. And maybe it is just the rolling reset, like how the housing market had a recession. It's in, no, it's still in a recession, right. And so they're in the tech industry, the startup industry.

Yeah, how quickly we forget because of chatchee, and the AI hypers that seems like it's been here forever? It hasn't. Chat GPT came in November 2023 and that basically

marked the bottom. But those stocks were in a massive recession. Look at the charts of Amazon and Google and Netflix and meta. Yeah, Facebook was down 70%. InVIDIA was down 66%.

It lost two thirds of its value. So I think the big thing that I am a true believer in of this time is different is these cycles are just going to keep happening faster and faster. So when you get the downturns, they're not going to last

as long as they did in the past. That I definitely agree with that this stuff moves way quicker than it did in the past. Technology is a big reason for it. All right, Barron's had their forecast, which feels a little bit like they're on my corner here. They stole it from me. What's your corner, the fence?

No, my corner is taking the probabilities of the past and looking at the fact that usually when we have an up year, it's a big up year. And so I said if I was a Wall Street strategist, I would predict a 20% gain most years. That would be my target. my baseline target. And then once every four to five years,

I would predict it down 10 to 15% year. And I'd be right probably more than any other strategists on the street. Fair? No? Yes. Keep going. So they also said they're predicting another 20% year. And they said it's basically AI growth, deregulation,

but expect some volatility. So I looked at it, so this would be, that would be three years in a row of 20% gains. I looked, we're now, we're on track four unless we fall out of bed here in Santa Claus rally doesn't happen. We're looking at two back-to-back years of 25% gains in the S&P. So last year was 26%. This year so far is like 29%. And I've tried to look back, how many times have we ever had back to back 25% plus year gains in the S&P, going back in the last 100 years? A stock market three, Pete. So it's only happened twice three times. So the 1930s, the 1950s, and then the 1990s. And the 90s

went on a five-year run of 20- and 30-perty-percent gains. Then I looked at, okay, what happened in the year after these back-to-back-25% gains? And basically something for everyone. In 1937, the stock market fell 35. Following back-to-back, it was 47-32 minus 35. 1950s, it was 53% gain in 1954, biggest gain in history that I could find for the S&P. The next year, after a 53% gain in 1954, the stock market was up 33%. Can you imagine how many people were ready to call it over at that point? Then the following year, in 1956, it was up as another 7%. So that was pretty good. Then the 90s, it was plus 33-97, plus 28, 98, plus 21, 99. So you have the third year you have minus 35, plus 7, plus 21. So kind of something for everyone. A tepid gain, a crash, and a really good

gain again. The sample size is n equals 3 here, so throw this out the window. But the point is this doesn't happen very often. Last week, we were talking about David Rosenberg throwing in, but not throwing in the towel. So wait, wait, wait. You do your Michael's predictions every year. If you had to stake your claim

next year, what would be more likely to you? Another 20% gain or a down year? You can put some odds on it, too, because I know you're not, Scott. Yeah, I will. I will. All right. I would say they both have plus

odds. So I would say up 20% give me like plus 180. That sounds like pretty good odds to me. Plus 180? Well, let's let's convert this. So convert just for the audience who's not gamblers.

Convert plus 180 to percentage. So that is oh, thank you. Thank you, AI. Don't tell me how to do it. Just do it. Convert plus 180 gambling odds. Come on, Gemini, you piece of garbage.

All right, so it shows me the answer. See, this is why Google's over. There are times when I look at gambling odds and it makes me feel like an idiot. I know why they do it that way, but it is kind of hard to comprehend. All right, so while we're doing this, while we're doing this, all right, plus 180. Thank you. Thank you, odds converter. That's a 35% chance.

Okay, so that actually does sound realistic to me. Thank you. I'm a good handicapper. Okay. Now, for a down year, I would say plus 150. Not saying, one third, one, let's go 142. Final answer. All right, that's a 41% chance.

So I think that it's a, I think that if I'm, if I'm Vegas, I'm saying a slightly more likely to be down than to be up 20%. Okay. History would say that you're more, there have been more up 20% years than down. years. Yeah, I don't care about history. Okay. I'm just, if I'm playing the probability, I'm an odds maker, that's what I'm going to do. So, okay. So you're more in the camp of, okay, it'll be if we're up, we're up kind of a muted year. Yeah, I don't, I think another 20% gain is slightly unlikely, you know, with the caveat that like literally who the hell knows,

we're guessing. We're just having fun. Just a couple of guys talking sucks. This is why, if you're trying to make a year-end target, it's basically an impossible thing to do. So here's my prediction for next year. I'm going to say like an air quote prediction because, again, I'm guessing. I'm going to say that the tail wins, the momentum is strong. It's not just going to fizzle on January 1st because the calendar rolls over. So I'd see a strong first half of the year, some sort of Vic spike in the back half of the year. We're up 15% in the first half. Give most of it back in the second half. We end up 3% for the year. 3%. Okay. Volatility is a second half story. I think there's my only prediction

is there are going to be a lot of by the election, sell the inauguration pieces in January. Okay. That's going to be the call. Yeah. All right. So anyway, getting back to what we were talking about how David Roseberg didn't throw in the towel, but he did say some things that, you know, definitely made...

He threw in the towel, but he said he didn't throw in the towel. Right, right. Definitely, definitely some... Listen, I'm throwing the towel in, but I'm going to say I'm not throwing it in. Yeah. Just so we're clear. All right, so not every bear is throwing in the towel. No. John Husband, would you say there's been a lot of bear poster children of the last 15 years, Ben, a long list of them. Would you say that if there's

one Mega Bear, see the one, is it Rubini? Is it Husman? It's got to be Husman, right? He literally hasn't changed his tune since probably 2011, I'd say. 2011? All right, so for the audience, who is this, this John Husman? So he first came, he rose the prominence following 2008 crisis because he said there's a crash coming, everything's overvalued, and he hedged his portfolio in his mutual fund, which is, which is a stock, was a stock fund that could also hedge, was, the SPP was down 37% in 2008. His husband's strategic growth was down 9%. So it had to be one of the best performing funds of the decade, right? Because it started, when did it start? It started earlier than that.

And he did pretty well on the dot-com bubble as well. Yeah, so he had a 10-year track record that was pristine. And billions of dollars float in, obviously. Was it six at the height? What was the height? It was five or six billion, yeah. It was a lot of money. To give you an idea of how long we've been talking about John Hussman for people that

might not be familiar with him, Colin, our friend Colin Roche tweeted, this is years ago, this bull market still has $300 million left in it. And I don't know if the number is $300 million, but what Colin was showing was the total assets under management of, is it HSGFX? Is that the ticker? Yes. So basically, basically like this bull market won't end until Husman's assets go to zero. The crazy thing is. When was that? Was that 2015? That was so long ago. Yes. And the crazy thing is I think most of the money in there is his own that he's made from fees.

I think the majority of the assets in the fund are probably his. It was about $7 billion at the peak. And then he did not get off the bear's train. He started calling it a bubble in like 2010, 2011. I found a piece that he wrote for Business Insider, 2012. This is the headline, Hussman. This is one of the worst times to buy stocks in history. And the reason we're saying this is because the Financial Times posted a piece of his that says, New Era, same bubbles, and forgotten lessons of history.

Yeah, so anyway, yeah. So John Hussman is still saying the same thing. Yes. So he basically has been comparing this to 1929 and 2000 for like 15 years. And he says, this is a. in 2012. We presently identify market conditions as being in the most negative 1% of historical data based on the average

expected risk return. And since then, of course, the S&P is up almost 500%. It's up 14% per year. So I can't believe the Financial Times gave him an op-ed and allowed him to publish this saying, like, listen. Well, he has a PhD.

So, Husman is... He really does sound... I had an old colleague who in 2014 was telling me, you know what, what if Husman's right? And because he's He sounds very smart one. He's a very intelligent sounding person who is always wrong. By the way, I'm not going to lie. Again, getting back to the things that we were writing in 2015 that were like taking the other side.

I was nervous to take the other side of a PhD. Like, he's got models. You know what made me feel good, though? What? Jesse Livermore, who used to blog out of philosophical economics, who's the smartest investment personal lie, probably wrote a critique of John Husband's chart of estimated future equity returns in 2014. I remember reading that.

Basically saying these models are form-fitted, it's torturing the data. And I guess the hard part is, the thing that gets me is like the lack of intellectual honesty. I don't know to him personally, but... People say he's a nice guy for what it's worth. Yeah. He changed the name of his fund from Husband's strategic growth, which was a stock market fund, to Husband's strategic market cycle fund. Oh, boy. Come on. He changed his models from a 10-year model to a 12-year model at one point because the 10-year model looked bad. And so instead of changing his mind over the last 15 years, he's dug his heels in and won't just say, you know what, of predicting this is 1929 and 2000 all over again, I'm just going to stop making predictions.

Yeah, no. Josh would say that he beclowned himself many, many, many times over. So he's saying the same shit that he's been saying. And maybe he's right. But there's a little... No, no, no. He can never be right. At this point, you can't be right after you've been predicting it for 15 years. So there's a little story of the boy who cried wolf. Ben, you're familiar with this story. Yes. I read the book, I read this book to my five-year-old. because Logan told me that he brushed his teeth when, in fact, I smelled his mouth. He did not brush his teeth. And he's been telling untruths.

So I sat him down. And I said, come here. Come here, son. It's time for a story. And I read him, the boy who cried wolf. And the lesson, and when he, when I catch Logan lying, his lips quiver and his eyes well up with tears. Kids are the worst liar.

It's the cutest thing ever. And his eyes go to the side. It's just beyond adorable. So, but anyway, here's the lesson from the boy who cried wolf, which we all were, which we all had that story brought to us many years ago. People don't believe liars even when they're telling the truth. And now I'm not calling John Hussman a liar because I don't know him, but he is the boy who cried wolf.

And perhaps this is the time where the wolf does come and eat the sheep. But to Ben's point, he gets to the boy. no credit for that. Because had you listened to him in 2012, you would have missed one of the greatest bull markets of all time. And he is the most cited. He is the ultimate bear's bear, right?

When Henry Blasjo was writing his pieces, he was citing John Husman. When people are bearish, yeah. They cite the PhD with the model, with the mutual fund, with the track record. And he's digging in his heels. And it really is, it really goes to speak about how

incredible America is, the land of opportunity. that you can have this sort of performance for so long and be so wrong and do so well for yourself. Yes, it's, it's really, it really is unbelievable. The guy's probably made $100 million in fees or something. And from the life of his fund, his fund started in the year 2000. It's up a grand total of 3%. Yeah. So listen, again, not to get personal because I don't know this person. I don't think that he intended to be wrong. Obviously, I think that he was doing his best. But at this point, yeah, maybe just stop writing op-eds. Maybe just stop trying to scare people.

And when you are right there, it's an elixir like none other in this investment business. When you get headlines written about you, the person who called the 2008 crisis is calling another one, it's very hard to get out of that mindset. And I saw so many people in 2008 that called the correction right, the crash right, that never got out of that mindset. This is why Mr. Barry Riddholtz is a true one of one. He really is. Like, Barry was bearish in 05 and 06 and saw this coming, and then, and he'll be the first.

I read some of Barry's housing stuff, and I'm like, this guy doesn't he'll be talking about. And he called the housing crash, right? And Barry will be the first one to tell you that this turn was nothing but dumb luck, but he turned. And not only did Barry turn, and again, the time was dumb luck, but it was like three days either before after the bottom in March 2009. Barry was in the New York Times, it's on record. He's the only bear that I know that didn't get. stock in the mud. Yeah. And he became well known because of having, he was bearish on the stock market going into the crisis and then said, all right, I think the stocks are down 60%. Probably

got to buy him here. Okay. Let's move on from this. Hey, this is a craziest chat of the stat of the week from Jeffrey Kleintop. If one stock in Vidia was not part of the S&P 500, Europe's stock market would be outperforming the S&P since the current bull market began. This is October 2022. That blows the face and the mind. Right? Wait a minute. I thought maybe if you would have said, like, oh, take the Mag 7 out and we're even, but Europe would be outperforming X-NVIDIA. You sure about that? You sure about that? He's the chief investment strategy to Charles Schwab, so I'm guessing that they checked him a few times on that. Wow. That's one of those stats that just gets you, right? That gets you right in the funny stock market bone.

Wow. Also, why stock picking is so difficult. Imagine being an active manager and looking at this stat and going, see? See what I'm dealing with here? It's like you're trying to pick a car. Too soon, man.

By the way, I walked into basketball on Sunday morning, and one of the older gentlemen goes. So, I shouldn't buy an Audi, huh? I think everyone learned that. I just turned my auto pay on. Someone said you should be looking into the lemon laws in New York. I did it. It's too late.

It's not technically a lemon. All right. Good one. Sam Rowe did a 22 eye-catching charts post on the TKer. And did I do wrong again? Every time. Ticker. All right.

And speaking to this time is different. He shows how companies have changed over time. This is from Bank of America. And they show companies have lower leverage now they did in the 90s in 2000s, which is like leverage has fun. which is kind of crazy when you think about it because you would think companies would be more highly leveraged now

because rates were so low for so long. They're higher quality. This is based on credits. They're credit rating. So B plus or better credit rating is much higher than it was in the early 2000s in the 90s. And they're more asset light.

And I think this is the big one for recessions. It's the asset light thing, right? The fact that we're not dealing with a big CAPEX re-spend or whatever, inventory. But also think about how much information and how good these companies are at responding to the changing environment. Think about how quickly the tech companies shifted and pivoted out of a recession.

Like, because they can, everything is on the cloud and everything's software base, they could just turn the dial. Whoop. Right. Uber just decided, hey, we're not going to lose money anymore and get people cheap rides. We're just going to change. And it was as simple as that, right? And they didn't have to go buy a bunch of stuff to make that change.

Okay. Talking with, this is from an American living in Europe. Talking with French people, I don't get the same feeling of entrepreneurial spirit as the U.S. I think there's also a general risk aversion of capital allocation and the stock market is perceived as risky. To some degree, the prioritization of stability leads to lower growth. Only recently have I heard discussion about the S&P 500, perhaps due to the visibility of its performance. When I go back and forth between the U.S. and Europe, Europe seems in a standstill in comparison. The flip side is the European lifestyle actually is great and the two continents

could probably learn something from each other. Yeah, I buy that. I feel like we've heard this from a lot of people overseas. So we have a decent overseas audience that basically say, yes, you are right. We don't create businesses like you. We don't innovate like you, but we probably lead a more comfortable life. I told you what the guy said to me in Dominican Republic, right? He's like, look at our houses.

They're shacks. And he said, but I have no stress. And that's like etched in my memory of like, man, that's the tradeoff. I like stress. I think a lot of people do, though, in America. I think that's part of what makes our, like people, we love to complain, we love to consume. and we love to be stressed out.

Yeah. Right? People love to talk about, you cannot go to a child's game anymore, any of the games I go to without parents talking about how many other games they've had that day or how many practices they've had

and how busy they are. They wear it like a badge of honor, though. They're not really complaining. They just like to tell people, you know, how busy I am. Oh, yeah, how busy I am? Yeah, no, it's the new weather, right? Yes.

All right, so a great chart from a still bear, credit to him, Albert Edwards. I don't know, there's something like kind of charming about Albert Edwards. He wears, like, he wears, like, funky shirts. He's got the British accent. Is he not throwing a towel yet? No. Oh, okay. He seems like a happy bear. I don't know. I kind of dig that guy. So, he has a chart showing U.S. stocks and profit continue to gain market share in global

equity. So he's looking at the profits as a percentage of U.S. global like, I'm sorry, the U.S. percentage, let me try that one, third time. The U.S. as a percentage of global equities in terms of profits. And that's obviously gone up. It was as low as like four. 40% in 2010. Now it's 55%. But then he compares it with the market cap. U.S. as a percentage of global equities. And of course, that has even outstripped, that is gone even further still. It's now 70%, which is what you would expect, right? I think you would expect the market to, like, I'm using air quotes, like, overdo it. Right. You wouldn't expect these to just follow in line. Right. It would be in line. Like, one would outpace the other. But it is interesting. If you want to make a bearish case,

like, yes, the U.S. is swallowing the world. Look at the profits as a percent. However, the market cap is just outdoing even that. And so... The crash in the late 1980s to the 90s with Japan in the market cap, the U.S. is something to behold, right? Yeah. Look how fast that happened.

Somebody emailed us, Ben. And this one sort of... Not sort of. It annoyed me. I'm going to be honest. It annoyed me. It was very nice. Like, thank you for making great content.

I love the team dynamic and all that good stuff. Having said that. Having said that. It would be cool if you guys had your own patented fear, greed, gauge, stick segment, and we could track this over time. Michael's attitude slash emotion towards market sentiment is readily apparent in the tone of voice used. I was there for COVID and the fear was palpable.

Yeah. Were you not? I mean, I was scared in COVID. That's a scary time. Yeah. Were you not scared? Like, in fact, let's run back to tape. I'm pretty positive.

In fact, I'm absolutely fucking positive that I never told anybody to like sell stocks out of fear. Not saying that you said that I said that, but I definitely did not say that. Okay. I'm also listening now, and it feels all caps so frothy. I don't like that. Okay, I want to come to your defense on this. Please defend my honor.

To your defense, the way that we talk about the markets on this show, it's a coincidence, not a leading indicator. Coincident meaning we're trying to gauge. No, it's concurrent. Yet, it's a bull market. How should I sound? Right. We're trying to pull together how people feel about the markets right now.

And that, so yeah, it's coincidence, not. It's not leading, like, this is what's going to happen, and it's going to happen forever. We're trying to gauge how things feel at the moment. But I would like if he provided an example of me sounding all caps so frothy. Yeah, I don't see that either, because I feel like we've really tried to take the other side for the last six months least or so just to be like, are we sure this isn't, you know, this feels kind of crazy. I think this person is projecting. It's possible. They're worried or they're being left behind or the way that.

Anyway, I responded to this person as I respond to everyone. Please, email me back. I'd like to hear, I'd like to hear some more, please. The other thing that, the way that I look at it is, Greenspan gave his irrational exuberance speech. I'm going to write a piece on this. In December of 1996, if you read the transcript, it's not as bad. He wasn't, like, pounding the table saying irrational exuberance.

He was just kind of, like, lightly planting the seed. He wasn't saying, like, this is crazy. The way that he, it's not as bad as history makes it out to be. But I think the stock market fell like three or four percent the next day afterwards because he said this. But then it was up 100 percent from then to the end of the decade or something. So I do think that while markets seem like they're very speculative and people are going out of their skis a little bit right now, things could always get way crazier. And that's the way that I feel about this stuff is like, yeah, there's frothy parts of the market, but be careful.

It could go even more nuts. That's the way I feel. Yeah, who knows? Yeah. All right, good one from Clementine investing, which is a good substack. So a study from Purdue University analyzed 77 million messages on stock twits to analyze how retail traders form their investment opinions. This is, I don't, I didn't read through the actual study to know like how much of a leave

they're making here, but they said they compared the analysis with how people talked on social media on stock twits with trading data from Robin Hood. And they found that Stockwick sentiment does influence Robin Hood trading volume, indicating that retail traders follow through in the advice and opinions shared on social media, which I, that makes sense to me, right? But then they look at technical analysis for people who were bullish or bearish based on technical analysis on stock twits, okay? And then they look at this chart here.

So this is retail technical analysis on stocks that were bullish and bearish. And in this piece, they talk about how no, these charts are not reversed, the stocks identified as the ones with the best technical analysis picture, not only underperform, but system lost money. The stocks identified as the ones with the most bearers chart systematically gained after 10 years retail traders would have lost almost 40% of their initial investment on their buys and would have gained 30% had they held onto their cells. Do you think that this is just that the stocks that people are talking more about are probably too stretched? Wait, hang on. Retail traders have lost almost 40% of their initial investment on their buys and would have gained about 30% had they

held onto their cells. Right. Based on people talking about charts saying this chart is bearish, this chart is bullish. It was essentially the opposite. So I do understand, I do understand the fact that like people have a tendency to sell too early. So, so in a bull market, I'm not surprised

that the stocks that they sold continued to work. But I... True. But they were also bearish on those stocks. Well, maybe they're just being labeled bearish when they sell them. True. I agree. This kind of, it feels like there's some leaps being made here.

But this makes sense to me in terms of sentiment, in terms of the stocks that people talk about the most, are probably really popular because they've already gone up a lot. And people probably got up, people probably missed the boat when they started, when sentiment really started taking off with these stocks. Yeah. That makes sense to me. I wonder if, yeah, I don't know. It does make sense.

But again, I didn't read the article, nor, let's be honest, nor would I be able to understand the context of the article and debunk any of the models. that they made. But I feel like this, can you actually measure this? Yeah. I, but as far as sentiment goes, this actually kind of makes sense to me. It does. Yeah, it does. All right, so let's talk about what's going on inside the market. There's some weird shit happening then. As always. The total return, this is from sentiment trader. And I'm going to be speaking a lot more about this on what are your thoughts tonight with Josh. The total return for value stocks has declined for 10 consecutive days. Since 1926, this has happened fewer than 10 times.

So very rare. Over the past 50 years, it has preceded double-digit one-year rallies and value stocks. So there's some funky shit happening inside the market, Ben, I don't know if you're aware of what's going on. But there are three sectors that are absolutely crashing relative to the market. So if you divide like this by the S&P, and it's XLE, so it's energy, it's materials, and it's health care. And they are all violently crashing compared to the market. This morning Axel E's down another 1.4%. And this definitely

has me not feeling too bullish. Counterpoint, energy is like 3% of the stock market now. It doesn't matter. Is that fair to say? So oil has gone nowhere for 15 years. Is it safe to say that energy doesn't matter as much as it used to?

That's a fact. Nevertheless, healthcare? This has been the worst sector. Energy had a, a little comeback in the early 2020s, but I don't know, for the last 12 years or so, energy has just been a terrible place to have money? I'm just saying as a person who looks at what I consider to be like a weight of the evidence

approach within the stock market, I look at a lot of different things. Whoa, whoa. The J.C. Peretz approach. That was very CNBC of you. How did you say that again? No, that's J.C. Oh, okay. I look at a lot of different things, and I don't like that these three sectors that are

not insignificant. I know energy is a small sector. I know materials is insignificant, though. Don't you think? No, I don't think that. That's why I'm saying I don't think that. I understand that energy, isolate energy. It's a small sector. It's a small slice of the overall stock market. I get it. But I don't like that these three sectors are full out, I don't want to say full out crashing because I don't want to be like hyperbolic. But if you, I don't know how else to describe it. Look at XLE divided by SPY. It is crashing. And it's not just XLE. Look at materials doing the same thing and look at health care doing the same thing.

So earlier in 2024, in fact, for most of the year in 2023 as well, Josh and I were saying, like, listen, I'm not concerned about concentration because it's not as if the rest of the market is falling out of bed. It's not like SPI was going up and RSP was rolling over. So RSP, the equal weight, has been down, has closed lower than the open for like 12 straight days. I'm having Matt Charkin do some work on this. So, listen, is it like, I'm not trying to... Under the surface, things don't look very good to you right now.

That's all I'm saying. All right. That's all I'm saying. Okay. I mean, it feels like we could use a quick little washout just to slap everyone on the wrist again, correct? Yeah, people are getting too bullish. And apparently I'm getting all caps are frothy, so... Okay.

Well, here's some more froth for you. Torson Slok gave his economic outlook for 2025. 2025 economic outlook firing on all... cylinders. He's basically saying, boom, this is, we're not slowing down for anyone right now. This bus is keep going. So he talks about how he said, what happened to long and variable lags? Fed starts hiking. Look at economic growth. Didn't impact it basically at all. Keeps remaining strong. Fed hikes have not slowed down the consumer. Personal consumption expenditures relative to GDP has been rising for the past three quarters. Corporate profits are near all-time

highs as a share of GDP. Ben, you're right. There's a lot. There's a lot of And Torson's right. There's a lot of reasons to be bullish. People aren't bullish for no reason, okay? Everyone's not an idiot. And I would say to all of you people listening who think they're so smart and they're going to fade this, you might be right. But also understand that if you look at the historical data, everyone being bullish is not a sell

signal. It's just not. Everyone being bearish is a buy signal. They're opposite but not equal. Yes. Most of the time, the trend, you want to write it. If you're contrarian all the time, you're going to be wrong most of the time. There are times when being a contrarian can be very, very beneficial to you.

It doesn't happen that often. So I understand that it feels like everyone's bullish and therefore you should probably you should be cautious and I get that and we will see. But if you look historically, these bull markets can last for a long time. And how many fucking times been have I used the quote from the money game over the last 10 years about people want to know what time it is? Everyone's at a party and everyone wants to leave early and people are saying what time it is, but the clock has no hands.

How many times have I used that quote for people that are worried that the bull market is getting long on the tooth? We've been in the eighth inning for like 12 years now, according to most people. All right, good email on wage leverage. Ben mentioned 25% increase in wages. Isn't there a lot of leverage within increase in wages versus discretionary investments? Example, when my wife started working part-time, fourth child started school. Oh, man, that's a great feeling when all your kids are out of daycare. She'd compare how little it was versus my full-time fairly high salary, not to brag.

as a percentage of total, it was small, but it was huge for discretionary at that point of our lives after all necessities were covered. So even if it's only 10% of total income, it could more than double our leftover income. So that makes sense to me, where you already have everything covered

and think about it. So Mike Zucardi tweeted this one from Bank of America, after tax wages have grown significantly for lower households. We've talked about this, but the highest percentage gain is in lower households. And to me, those increases, obviously some of that is eaten up by inflation,

but a lot of that is just going straight to spending. It's all being spent. Yes. All right. Inflation chart crime time. I've seen this a lot. This is from Deutsche Bank. They show 1970s inflation.

You have a little bit of about inflation early. Then it goes down. Then it goes up. Then it crashes. And it goes back up. And a lot of people saying, hey, we're following this same path. And I think this is a chart crime. Not quite a felony.

Definitely a misdemeanor. Is that fair? Because look at the axis. The axis is way more truncated for the 70. I did this today, and I had chart kid Matt do this for me, look at the next one. It's sure it's kind of following the same path as the 1974 to 1982. Well, you know what, then? Like, you don't, they don't need to cheat because the, the proper one that Matt created

still looks pretty good. Yeah, it kind of follows it, but, and I've talked about this, you can find on my blog where I said how all the ways this isn't like the 70s, but if your reasoning for inflation heating up again is because the chart from the 70s looks like the chart from today, that's a good reason. You wrote about this a long, I remember a long time ago, where you picked two random lines that fit each other, right? And they were completely different. It was Altria and the Dow, I think. Yeah. And that was a long time ago. Just line on top of line. It's really easy to form fit two lines if you really want to. But that doesn't mean,

and inflation could rise, but it's not going to rise because there's lines like this. Yeah. All right. Good news of the week. Obesity is falling. This is from Bloomberg. Ben, I like when you speak like a reporter. Like you've got like your pet in your head. Let me do the papers together, you know? The number of obese Americans has been steadily climbing for years in the country's average BMI has been creeping up along with it. But in 2023, something changed, obesity levels fell to 43.96% from 44.1. Okay, I didn't realize it was that small decline.

If you have to go to two decimal places. Okay, so they say it's a small... There's 70 fewer, fat are Americans. This is great. Okay, it's a small decline, but a meaningful one. The biggest change occurred in the south, according to the Nile Cichita has the highest concentration of prescriptions for written for the drugs of Ozempic and these other things. Just anecdotally, I'm hearing a lot more people that I know, like friend of friend or family

member or whatever, using this, do you have any of this or not? Like, oh man, that person lost a lot of weight. Oh, yeah, yeah. What happened? And someone will go, well, it's Ozempic. But so what? They lost weight. I don't judge. I think, uh... I feel like a lot of people are judgy about that. And I, like, if it's going to help us become a healthier country, I'm all for it as long as the side effects aren't. to grad, and it sounds like... I saw somebody recently. I wasn't trying to do it.

I was like, you look amazing. But how is that? I mean, why is that rude? Is that rude? It's not. I don't think so. No, people, they looked amazing. Yeah.

That's the whole point, no? Yes. And I continue to think that if this, the pros and the cons, the pros totally outweigh the cons here, if we can get people healthier with this, we should be handing this stuff out like candy on Halloween. I'm not a doctor. If you are a doctor, please don't email us about muscle loss. Don't care.

I just, it's good, no? The one thing I've heard from a lot of people saying that, like, one of the reasons you don't eat a lot is because you're nauseous a little bit on the drug, which makes sense. Like, you don't want to eat when you're nauseous. Hey, listen, tradeoffs, right? Yes. Life is full of tradeoffs. Okay, we got an email. Homes and Michael's neighborhood.

What's that? We talked about it last week, but it got cut out because you were in, like, the worst internet ever in Las Vegas. Oh, what were we talking about? I can't remember. By the way, we got an email about. Speaking of my neighbor, we got an email about a, somebody said they feel like they're paying like sprinkler insurance, there's like sprinkler inflation. Yes, because we talked about this last way.

A lot of people said, we need like an inflation gauge of sprinkler shutoffs. And here's the thing. Oh, actually, I think I have my bill right here, actually. One of the reasons mine is so small, though, is because we, we have like 20 houses in our neighborhood and we all come together. Oh, man. What a boomer. Look at all those paper bills you have there.

You formed a union? Well, no, we have an association. So, an association. So, no, my wife, listen, we still got papers. And my wife said, you got to go through all these papers. So I got one right here. Okay, here we go. Jimmy Sprinklers.

What did I say it was? Yeah, okay. 85 bucks plus tax, $92. Okay, so ours is like 50, maybe 60. So yours is a lot more than ours. But we, again, we bring it all together and they do it all in one day. Yeah, but Jimmy stands by his work. I love how it's called Jimmy Sprinkler.

Yeah. By the way, speaking of Boomer. So there was a guy, you know, we've been speaking about things that are going to die with our parental generation. There was a guy on the flight home from Vegas who was reading a newspaper, a physical newspaper. Wow. That's a move. And speaking of airports, Ben, you mentioned it's fun to run an airport. I'm here to tell you it's not fun. So on the way home, my flight was delayed. And I was doing some shots. shopping for the kids, looking in the stores, and all of the sudden, I look at my foot, I'm like, f***. Like, I completely lost track of time. My flight was boarding. That doesn't sound like you at all. Yeah, because my flight was delayed and I just, whatever.

So I started sprinting. It was horrendous. I get, I was sweaty for the flight. It was the sweaty part. That's the worst. It's sitting down in your seat and being all sweaty and trying to turn the air thing up as as high as you can. Yeah, so it was the opposite of fun.

Okay. I'm sorry. I think it's a little exhilarating just to push that boundary of... Okay. All right. So we got an email about Christmas lights. We'd like to downsize and sell our now non-decorated for Christmas home right next to the high school, but there's nothing for us to buy. Plus, my husband has a shop in the basement and a condo isn't going to do it. I wish we could simplify, but we were stuck and the nice young family who should be in our house are stuck too. It's a multi-generational issue. Oh, this is the one saying, oh, saying that older people are, that makes a lot of sense to me.

That, I guess that's a good point, is where are these baby boomers going to go? Is that the point? There's nothing for us to buy. Yeah, there's no inventory. Yeah. That, yes. I thought we got another email about Christmas lights. Didn't somebody say that, like.

I'm an ER doctor, and I'd like to make a counterpoint to Ben's position about hanging Christmas lights. Just like every July 4th, we see patients with missing fingers after home fireworks go wrong. Every Christmas, we see multiple traumas from falls off. ladders and roofs while hanging Christmas lights. Yeah, not worth it, Ben. Just pay for it. Okay, but I don't go high, though. I don't go way up on the roof.

I'm not doing the Clark Griswold. I'm doing trees, and I barely, I have like a five-foot ladder that I get on. So I don't go up top. So that's, that is fair. A lot of people did say also the other counterpoint is it's very expensive to have someone else hang your lights. But I guess you're, I don't know.

Again, I live in life in the edge running through the airport. I don't mind it. All right. All right. Car dealership guy tweeted. Odometer fraud is shooting up. According to the latest data from Carfax, 2.14 million cars may have had Odominor rollbacks in 2024. How do you do that?

Up 18% since 2021. Just like in Ferris Bueller. Yeah, just do it backwards. The reasons, he said technology has made rolling back in Odometer easier than ever and is often done to dodge the lease mileage fees or artificially inflated cars value. It takes seconds to do and cost the next buyer an average of $4,000 lost value. Bottom line, if a low mileage car deal seems too good to be true, it just might be. Did I speak about the, what was that bullshit fee at the dealership? The, I forget what they call it, where it's like $600 if you don't get another lease with the car.

Oh, yeah. This is something I want to talk to you about, though. How many miles do you get on your wife's lease? Because that, that to me seems like the biggest reason where you guys should buy a car not lease, because if she's putting a million miles a year on, then leasing doesn't make sense for you at all. Well, this is going to be her last year driving to Brooklyn. I'm putting my foot down. It's too much.

Okay. That is a lot. Okay. This is from the Wall Street Journal. The week CEOs bent the knee to Trump. So they say companies abandoned him after the January 6th rise. it. Now they're rushing to Curry favor with the president-elect as he prepares to return to the

White House. Oh, shut up, Duncan. What? Duncan's on our Slack group. Hashtag homeowner problems. Hashtag must be nice. Yeah, Duncan, you don't have to worry about hanging lights because you rent. So they say

Trump had this get-together. I think this was at the stock exchange where executives from Visa and and Facebook and Goldman Sachs and Charles Straub and Citadel a big aerospace magnate was there, Bill Ackman, and he said already Zuckerberg has donated a million dollars. Bezos has donated a million dollars to his inauguration. And it's basically, this article is basically saying like, yeah, you guys moaned and stuff, but you fell in line. And this got me thinking about FU money, right? Because I feel like at a certain point of escape velocity, when you are super duper rich, you no longer have the ability to have FU money. Because you have stakeholders and shareholders, in charities and whatever hangers on. Like, there's a certain level of wealth where you don't have FU money anymore. So I want to think with you,

what is the true FU money of, like, your good place? Because I remember on Succession, cousin Greg said, hey, if everything falls through, at least I'm going to get $5 million. And Tom and Connor basically like, whoa, whoa, well, $5 million, that's the worst level of wealth. Because $5 million, like you,

It's you're, you can't retire, but it's not worth it to work. It's a nightmare. So I have a true level of FU money in mind. And when I see FU, I mean like, fly under the radar, not as much social pressure, but you're in a really, really good space for a, so what is your number here? I think the money doesn't consume you or your life. Okay. I think I have it.

What is it? No, I'm not going to tell you how much money I have, but I think I currently have it. Oh, no, I'm saying what is the number, though? where you could say, like, that is the sweet spot. Yeah, so I don't know. We'll get into this. But I think it's a mindset. And I think it's very much path dependent.

Yeah, true, true. Okay, but I need a number. Okay, so I have a number of mine. So the number, 10 million dollars. This is, I've dealt with hundreds or thousands of investors from all shapes and sizes. And once you get past a certain point, there's so much stress that comes with the money and you feel like it's a responsibility and you're worried about errors and family members. And then what you're saying is there is a level and it's different for everyone.

And maybe it's 10. maybe it's 20, maybe it's 50, where the money becomes more of a liability than an asset. Yes. Yes. And I think 10 is, from my experience, is about this sweet spot in terms of being able to be very happy with a large amount of money, but not enough money where it's going to cause you other outside stresses. So to be clear, I think that if any rich person looked at my bank account and my assets, they'd laugh and they'd call me poor. But I'm saying that, like, I think coming from a place with not a lot of money and being able to, like, make more money than you thought you ever would and pay your bills and provide for your family, like, to me, that's, that's F you money, even if it's not like, you know, what people think of when they think of FU money. Being grateful is a big part of it. I remember my brother when he got his first job out of college. And I asked him, I said, like, how much you make it, you know, which was a, not something you ask people.

But he said, I make enough to go out on the weekends and the bars of my friends and go on, like, one. nice vacation a year. Yeah, so how much more do you need? I was, uh, I was at a conference recently, and somebody did ask me what my number was, and I was so taken aback. I was like, what do you mean? Like, he's like, you know, like, what's like your number to like, I don't know, I guess we're Thai. I'm not sure what he was asking exactly. It was like, I don't really, I don't really think like that. I don't know. What's yours? And he said, and he said 100. I was like, a hundred. What? Jeez. Yeah, I don't really think that way either. I, I'm with you. I'm at a way better place in my life at age.

40, how am I, 43? Yeah, I'm not motivated to see like dollars stack up. I'm much more motivated to like live my life and spend the money and enjoy it and give some of it away if I can and all that good stuff. Speaking of money, I was trying to teach

Kobe a lesson. So we converted my attic into like a play area. So we don't have like a, we don't have a basement or any really place for the kids to play. And when they come over, they're like all up in our business, right? Do most New York homes not have basements?

Is that right? No, I think most of the towns in my, most of the homes in my town do have a basement. Okay. So the style house that I have does not have a basement. So we just finished and it's great. The kids are upstairs. They're having fun. It's like their own space.

Like it's quiet downstairs. Robin and I could like breathe a little bit. So I was trying to tell Kobe that the attic costs a lot of money. And I said, because he's like at the point in time, he's seven years old. he's resisting math homework and stuff. And I said, and I'm trying to teach him that the reason why you have to do well in math and school is because you need to get, you need to get into a good college and get a good job. So I was like, so daddy did really well in school.

Daddy got good grades, liar, liar, liar, pants up liar. Daddy got into a good college and daddy has a good job. And he said, you have a job? And I said, what do you mean? What do you think I do every day? I work, and he goes, you don't, and he's like, he's not trying to be funny. He's like, you don't work. You go on your laptop.

And I'm like, no, I have a job. And he's like, what, what's your job? And I said, I run a business. And he goes, he looked me like that. He goes, the compound brothers? That is funny. So I feel like being able to do the basics and then some. Yeah, I feel like I have Fee money, even though it's,

Not the F-U money, for real. That's a good way to put it. So Stuart Butterfield said this on a podcast number years ago. I wrote a blog post. It was like the three levels of wealth or I'm not stressed about debt, level one. Level two is I don't care what things cost in restaurants. And level three is I don't care what a vacation

costs. That to me is like going on a vacation and not being stressed about what it costs. That's a few money. Yeah. Right? Like, what more do you need? If you could take your families on vacations

and yeah, you might not have the second house or the third house for that matter, but like who gives an F? yes but but there is not to believe but the point but there definitely is a level like there is a level where you cross over and the money becomes a liability or a source of stress yes that's what i'm talking about and i think for a lot of those big CEOs it's and the one example people always give me as the guy who actually did it is the guy sold my space like 400 million dollars it's like my space tom and all he did was basically travel the world and give his money away and he's happier than ever he doesn't

do anything out. He might invest in some startups or something, but he just, he sounds like he has the coolest life, and he decided to- So that's, that's the outlier. I have a friend who, like, knows some rich people, and he said he has, like, three friends that have had, like, $100 million exits, and they all say it became, like, an existential crisis for them. Like, their life, their life was destroyed by the money. I'm sure. Okay, way back machine chart of the week. I just pulled this up. This is interesting talking about frothiness. Is that a U-Chart or a me chart? That's a me chart. Uh-huh. Uh, no. number of trading days between all-time highs, and this must have been in

2023 because it was almost 500 days between all-time highs from 2022. Hard to believe. It doesn't feel like it now, but we had a pretty prolonged bare market. I'm saying. People forget. Yeah. It was, so it was almost 500 days between all-time highs. What's the line from old school?

People don't know for Greg. Was it Greg? But people do forget. There's no Greg in old school. Sorry. No, not old school. I'm sorry. Super bad.

It's like one of those scenes. in the beginning. Oh, yes. The kid is pita's pants or crampus pants or whatever. Yeah. Soccer, Greg. Speaking of comedies, so Meet the Parents did $330 million at the box office. I was thinking about this because they think they did it rewatchables, and they were talking on the box office.

And then Meet the Fockers did $517 million. 2004, shit. I remember I saw that movie in Florida. Meet the Fockers. It wasn't great, but it wasn't bad. It was kind of funny. The last one was unnecessary. So the Little Fockers, which was a disaster, even that to $311 million.

So these movies used to like really slap at the box office. And anyway. So it's more than a billion dollars between the three of those. Yeah. At the box off. And I'm sure the DVD sales for Meet the Parents was ungodly high. Forget about it. So they're doing it.

They're bringing it back. They're running it back. I'll see the next one. There's no way it's going to be good, though. Well, I'll still say it. So Ben, you move to YouTube TV just in time for them to jack up your prices. How do you feel? Damned if you do, damned if you don't.

That's FU money. See? Doesn't even care. Yeah, I don't know. I like YouTube TV. But I'm still paying for all the streamers. It's now $83 a month. Yeah.

So this is the Uber model too, where they made it really, really low at the launch. Yeah. And now they're increasing it. All right. I own the stock. I like it. Because they can. Here's what I don't like.

We're just out of ideas. We beat the super movie, the super movie. the superhero movie themed to death. Craven came out this weekend, Craven the Hunter. By the way, young Michael loved Craven the Hunter. When he was on Spider-Man, big fan of that character. I have no idea what that is. Nobody wanted to see it.

It bombed. So they beat that to death. Now we're going to beat to death the remake. So Austin Butler has been cast as Patrick Bateman in American Psycho. Do we need to see another American Psycho? I mean, I'm going to see it, but... Here's a take that will get me off of the finance world. I didn't think American, I don't like American Psycho.

It doesn't do it for me. I know people love that character and the memes and I don't like the movie. I understand. It's like not everybody's cup of tea. I get that. I just wonder how many people actually seen the movie. It's not that good of a movie. Oh, it's a good movie.

I like it. Quite a bit. I mean, he's good in it. I didn't think the movie was good. Okay. So, Ben, I had been mentioning, like, IMAX should do more releases. Like, this is what we should, we should go back to this well. That's more, like, I'd see Goodfellas at IMAX.

Not that Goodfell's is an IMAX movie, but. Especially since there are obviously lulls in movie times in the, like, there are, there are only certain movies that come out that are big enough to fill the theaters, right? So they re-released Interstellar, right, Ben, to 320 screens, and it did 3.5 million domestically and 3.75 million globally. The 10-day domestic re-released total now stands at an extraordinary 10.8 million, the highest grossing iMex re-release of all time we're going to see more of this and i'm here for it so in mccaneh's book he talked about remember the part where he cries because he's basically

saying goodbye to his family or his daughter yeah and in a in a ship he says that he did that in one take so he got he went over to the corner he didn't talk to anyone he went into his dark place and he walked over to no one he said let's roll and he did it in one take incredible you know we've spoken about this that movie did not was not that well received when it came out people yeah it's got a long tail i guess people love it i skipped it i watch it on a freaking airplane. Yeah, I own the movie. Again, I don't think it's one of no one's best,

but I think that's okay to say. All right, I got a question for you. So we did the running thing. Wait, do you want to read this person's story? No, we got, just shout out to Andrew, who had a funny story about running through the airport. Yeah, had a similar experience to me. Okay, so I asked you this the other day.

I went to get a haircut, get my ears lowered, as they say. That's a dad joke. And I think we were on a, filling a podcast, something. I said, hey, when's the last time you got a haircut? And I thought about it. And I said, wait, did you go into your last time sitting at the barber chair and think, this is it? This is the last time I'm getting my haircut ever. Or did it just sort of happen? No. Like, did you walk in and say, this is the last haircut I'm ever getting, make it good? No. So my last haircut, I'll tell you what year it was. It was 2013. It was before my wedding.

But I don't remember the actual haircut. But I do remember for years I hated getting my haircut but because my barber, who had a wicked sense of humor, would always show me the back of my head as if I didn't know what was happening. Ah, the mirror in the back. Yeah. So you have to see the, yeah. Because otherwise, it's out of sight out of mind.

It was horrible. I don't have I ever told a story in the podcast, but I was so anxious about losing my hair. Like, obviously, I was, like, very young because I always wore a hat, and it was, like, very much something that was, like, a big part of my life. And it was awful.

And I wanted to shave my head for a while and my, Robin didn't want to let me because she's like, just, like, I don't want you to like shave your head before the wedding. Like, what do you? No. So I had been thinking about this for years and I finally grabbed the, get the courage to do it. It wasn't courage. Let's be honest.

It was, it was forced. And I'm like, I'm going to be by myself. I'm going to do it. So I take the, the clipper to my head and I, and I do it. And it was such a relief, a weight lifted because I didn't know what was underneath there. I didn't know what I was going to look like, right? I'd never see myself bald before. So I didn't know if I had any, like, any, like, red spots or, or blotches or whatever

were. So I, I, I, face-time Robin. And I'm like, not so bad. Not so bad. It's like, and she goes, okay, cool, got to go. Bye. And I was like, that's it? That's it.

She did not, she did not care at all. Yeah. That's tough. At that age, I feel for you. I was like, I was like 20 when it started to go. It was not great. All right. this is one of my favorite emails in a while from Larry. Hey, guys. My name is Larry. I've been listening. What did you just say? Sorry. Hey, guys. My name is Larry. I've been listening to the show since the beginning. Love you guys, but I feel compelled to send an email. This week was different. The first roughly 30 minutes to show this is last week. We got a lot of people. We got a lot of people. During Michael's stories about the oddie fiasco, the Rosenberg Electric Story, and Oscar Robertson quote, Michael seemed incredibly relatable. As a Midwest public servant, I'm wired to assume that no one in the vicinity of NYC is a man of the people, a la'a Duncan and Sean.

broke that bias this week. I'm a 40-year-old fireman stuck in Cleveland, Ohio area. I know who, what the people are. Michael, you are a man of the people. Thank you, Larry. It's been settled. Larry, the fireman, and Cleveland settled it. That was one of my favorite emails ever. So thank you, Larry. That email went a lot to me. All right, Ben, there was an article that was forwarded to us by many of our listeners. When Middle Age arrives in your 20s was from the Wall Street Journal. And they did this cool thing where they said, how old does Middle age to you, and they say, see how your opinion compares to other Wall Street Journal readers in your age group. So they ask you two questions. What ages do you consider to be the start

and end of middle age? And how old are you? So I put the dial at 48 to 60. That was my answer. And I'm, of course, 39 years old. You think 60 is middle age? I say that's the end of middle age. No, 50 is the end of middle age. After 50, it's over. You're old? 50. 50 is a new chapter in your life. I'm not saying it's old, old, but middle age is 40s. That's middle age. You are, I can't wait to see you move these goalposts. Sorry, after 50, you're old. No. When I'm 50, I'm going to be old. You're almost 50.

I know, and then I'm going to be old. I've accepted this fact. It's part of life. So, on average, readers think middle age is between 42.7 and 60 is like when people start to retire. Ben, you're not a man of the people. I am. On average, readers think middle age is between 43 and 61. See, you're out of touch. People are out of touch with their own life. Middle age is typically defined as ages 40 to 60. See, it's settled.

But about 20% of younger people ages 25. How many people live to 120? That's not how it's measured. It's not literal. 20% of younger people ages 25 to 34 feel middle aged. The average 25-year-old says middle age starts around 37 and ends around 53. conversely, the average 65-year-old says it starts at 46 and ends at 62. See, the older you are, obviously, the later you think middle age starts.

Somebody, here's my favorite quote from the article. I still feel like I'm 27. Exactly. See, so when you're 60, you'll feel 40. Here's my favorite quote from the article. The things I care about have changed, says Young, who is more comfortable with people who are 35 to 40. He also thinks he looks five years older because his hair has thin and he has a bald spot.

So, you know the line from, uh, Black Swan author, Oh, Taleb, I was drawing a blank. He says, don't tell me what you think. Show me your portfolio. Same thing. Don't tell me how old.

Do you? I just show me your hair. I'll tell you if you're middle age or not. Whether you like it or not, right? What's this email about New Yorkers? I didn't put this one in here. Okay. I don't necessarily disagree, Duncan,

but who are the New Yorkers you're talking about? Duncan, if you want to jump back in here, you're more than welcome. The ones who moves here less than a year ago from Iowa or the one who have been, here their entire lives. There's an old joke about New Yorkers versus Angelinos that goes, oh, Chris loves to say this. People from L.A. are nice, but not kind, whereas New Yorkers are kind, but not nice. The example often used is that if you have a flat tire in L.A.,

people will stop and tell you how sorry they are for you and wish you the best. Send a healing thought, but will not help you with the tire. In New York, we'll call you an idiot for how you're driving and question how dumb you have to get a flat in the first place while fixing them flat for you. I think that's about right. All right. It is funny to be good... Duncan, your silence speaks volumes. The East versus West Coast thing as far as that goes.

The Midwest people are never involved in these conversations. I guess for good reason. Yeah. Ben, here's a great email. Somebody wants car advice from us. Okay. Which is kind of hilarious, given my experiences with the automotive industry. All right, here's a scenario.

My son has turned to 16 next month and will be able to get his driver's license. My wife and I both drive modest vehicles that are pay it off. She has a 2017 Honda pilot and I have a 2015 Jeep Grand Cherokee. Both cars have been good to us and look as though they have room to run. My dilemma is this. Do I give our son my 2015 Jeep and purchase something for myself or purchase something for him? I plan on putting $10,000 down on either purchase for me or try and find something that my son that's worth $10,000 and cross fingers are a less of the college. What would Michael or Bend do? First of all, that sounds like way too much money to put down for a car.

cars cost yeah i don't put that much down but cars cost i've i've been told but if you put if if you put down that much money and you get into an accident or the cars total that money's gone so i prefer to roll into the lease or the monthly payments but i would get yourself a new car yes kids get the hand-me-downs yeah definitely you do not get the kid a new car and you drive the old no no kid drives the old one they're going to run it in the ground anyway kids destroy cars there's going to be trash on the floor. You get the new car. We've said this before, but my first car was a 1998 gold Buick Regal, which was a hand-me-down from my mother. Not a cool car. That's okay. But it worked. Ben, what was your first car? Was it a civic?

1998 Honda Accord. Manual. I had to learn how to drive a stick shift, which was the first time I drove with the high school. I stalled it out like six times on the way to school. Could you still do it? Oh, yeah. It's up in the memory bank. It's like riding a bike. And it was, once you got used to it, it was kind of fun. It felt like you were driving a race car. Because back then, you didn't have the cell phone and stuff to deal with. So you could actually, I can't imagine anyone would want a manual drive today. I had a friend in high school that drove a stick shift.

And it was very much like the, and like, you couldn't tell them, like, bro, you're going to make me throw up. And I think the reason that eventually the clutch just goes. So it's like, it doesn't make sense to have one to drive for a long time. Were you a smooth driver or were you like my friend? No, I figured it. I could shift pretty easily. Like, I had a smooth. I had a smooth shift, yes.

We spoke recently about the number of CFA charter holders going off a cliff. Conversely, in 2024, a total of 10,437 candidates took the CFP exam, setting a new high for the annual number of CFP exam takers. And this makes a lot of sense to me, and I'm guessing it does to you as well. Yes, I wrote a piece about this like five years ago. Someone asked for advice, do I do MBA, do I do CFP, do I do CFA. And I said, CFP, there's going to be more need for financials. advice in the next two to three decades than ever in history.

See if there's going to be more need for CFPs in the years ahead if that's what we're thinking about. Yep. It makes sense. All right, Ben, I've got a bone to pick with my custodian, and I won't name names. I transferred money. I pulled money from my custodian into my brokerage account from my bank on November 25th. Okay.

And I see that the money, only half of it has settled. So I call them to figure out what's going on. And they say that there's been a lot of fraud lately from TikTok. And so they're making money settle longer. So I said, okay, well, it's November 25th is when I put the money in. When will it settle? December 18th. And I said, you got to be kidding me.

I know what's going on here. I know exactly what's going on here. You're trying to make money off of the spread from what you're going to pay me on the money and what the money's going to earn, what you can earn on the money. I don't like this. I don't like this one bit. That's a long time. That's absurd. Give me a break. What year is it?

So they said, if you pushed money from your bank, from your bank to your account, it would settle, you know, in two days or whatever it is. So I'm annoyed. What else was there? Yeah, I'm just annoyed. I don't like it. Blockchain fixes this. You know what's happening? You know the funny thing is about crypto? I feel like no one ever talks about the blockchain anymore. Yeah. Yeah. Right? It was cool in the early days to say like, listen, I'm more bullish on blockchain than I'm on Bitcoin. That was like a really smart thing to say.

That was the playboy. I read the articles. Yes. But I feel like you don't really hear about blockchain technology as much anymore. Oh, here's what I was going to finish with. So I'm like, well, I can't trade because it says you have zero available to trade. He said, you can call it in place to trades. Like, come on.

Like the 1980s. Come on. All right, Ben, recommendations. What do you got? All right. So did you see this movie carry on on Netflix, this new movie? I started and fell soup immediately. Any good?

Okay. So it just came out on Friday. I, that's one of the great things I love about streaming people. It's easy to complain about how cable is today and streaming. But going on a Friday night, seeing there's a new movie and just going, oh, yes. Yeah, no, excuse me. Who complains? I know people do, but streaming is wonderful.

Stop. Stop it right now. So it's that Taryn Edgerton guy, who you've probably seen in the Kingsman and a bunch of other stuff. And then Jason Bateman plays the bad guy. I'm not going to lie. Jason Bateman is a bad guy when he's, like, beating him up in the bathroom. It's not that believable. And I'm going to, I'm going to offer a bunch of nitpicks here.

Then I'm going to give my review. So it's way over the. top. It's a ridiculous plot. A lot of the stuff doesn't make any sense, and I loved it. Okay. It was one of those movies where, like, what would you do in that situation kind of movies, right? Like, we're going to hold your this person hostage if you don't let this bag through TSA. Does it take place in the airport or on the airplane? All in the airport. A little bit airplane at the end. Okay. And it's over the top. The plot is ridiculous. A lot of the stuff would never happen, and it was very entertaining. Two thumbs up for a sit-at-home movie. I enjoyed it. And it's a

set around the holidays that didn't need to be set around the holidays? And I think that just gives you a 10% premium. It was, it happened on Christmas Eve. And Christmas wasn't in the plot at all for it, but it just, they played Christmas music and it's like, oh, that made it better. I love it. All right. I watched Gattaca and I actually asked you if you, I think the reason I watched Gattaca is because some idiot on Twitter tweeted about how, like, you shouldn't have kids anymore until they figure out how to genetically alter them and make them perfect, which is something only a young person would say. So I watched Gattaca and I didn't see it probably since college. This is a movie I watched a lot in high school. Did we discuss this on the show last

week or was it off the show? Off the show. Okay. And it's Jude Law. It's Ethan Hawke and Uma Thurman and I think Alan Arkin is in it. And a lot of movies from the past about the future don't age well. But this is a movie from 1997 about the future. And it ages so well. This movie is like, dare I say, almost like a masterpiece. It is so good. It's such a good movie. And the guy who wrote and directed this, did Gattaca and Trubin show back-to-back years. Wow. What a run. Andrew Nicol, I think, he hasn't done much since then.

And also, since Jude Law was in this, Jude Law and Hugh Grant, both amazing on Smart List in recent months. Hugh Grant might have been my favorite podcast of the last, like, six months. The guy's hilarious. One more. You asked me for, what's my peak Ryan Reynolds? I've got it. Because I feel like you're a Ryan Reynolds hater. That's not true.

Right now, it's just friends. That's peak Ryan Reynolds because he's funny, he's arrogant, he's over the top. Oh, it's a good one. It is a good one. It's just friends. That's peak Ryan Reynolds in all his glory. Yeah. And it's a holiday movie, so you can watch it right now.

I'm almost certain I saw Van Wilder in the theater. I am not a metal theater. I don't think Van Wilder aged very well, but I loved it in college. Okay. All right, I've got a lot of wrecks this week. Where do I begin? I spoke about Blink twice last week, right? Yes, I looked for it.

It's not out yet, or I couldn't find it. Okay. So Christian Slater isn't blink twice. And I thought about this because Christian Slater is in the new Dexter, which I saw the trailer for. It's just, it's too much for me. I rewatched, like, the new Dexter season last year. I think I'm out at this point.

I only saw three seasons of Dexter. I stopped before the good one. But my point is this. You're like, sort of like, what happened to Christian Slater? He had like this really great career trajectory. And then, I don't know if it was drugs or whatever. 80s and 90s. He was huge.

Yeah, but he looks great. He looks kind of the same, right? He aged incredibly well. So, credit to him, I saw Smile 2, maybe two weeks ago. I forgot to mention it. I'm good with those movies. I don't need to see a Smile 3, even though I will see Smile 3. It might be too scary.

Okay. You're not a smile guy, right? I don't know what it's about. Okay. It doesn't matter what it's about. It just, it's terrifying. It gets me in the same. scared in the scare area. It is just a very

scary movie. I watch it with my hands front of my eyes. All the scary movies you watch and you still get scared. Very scared. Have you started watching the new Ray Ramano, Lisa Kudrow, Dennis Leary show? No. Oh, Dennis Leary has had it too? Owen Wilson as well. I'm a big Dennis Leary fan. Okay, I'll put that on my list. And I know you love Ray Ramano, right? Who doesn't love

Ray Ramona? It's called No Good Deed. It's going on my list. I'm a big Rayamano fan. Not exactly sure where it's going. but it's uh it's a it's a robin and i are enjoying it okay on the airplane on the way home i watched a movie called blood simple have you ever heard of this movie is that jeff daniels one no take a look from the dock okay so that is that guy he's the dad from clueless i don't know his actual name he's in aliens what's aliens four called he's the guy from uh what was a scott bacula show

back in the day. I can't remember it. What's the aliens four called? I'm drawing a blank. Oh, Resurrection. Yeah, he's in Resurrection. Anyway, and it's Young Francis McDormand. So this is the Cohen Brothers first movie. Oh, really? I've never heard of it. Me either, from 1984, and it's fucking great. And you could very much see early signs of, like, these guys are good.

It was from 1984, and it's very much one of their movies. I'm shot. I don't know how I never heard of it. Is that Dean Stockton? Is that how that guy is? Is that his name? I don't know. He's like the prototypical that guy. Quantum Leap, that's the show.

Okay. Ben, here's the difference between the jackal. What's it called? That show called? Day of the Jackal. Day of the Jackal on Peacock and the Agency. So I only saw one episode of the Day of the Jackal, and I'll watch it because it's good enough.

They talk to the audience. They're giving you, it's basically subtitles. You know when you watch a show, like Robin watches lawn odor. And you close your eyes and it sounds like they're reading from a script. And it's like, what? So the Day of the Jackal, it's more for the common man. I agree.

Going back and forth between the agency and David Jackal, you realize like, oh, the agency is way better. Yeah. So there's a scene with Day of the Jackal where he has like, he shoots it from like 3,600 yards. And they're like very explaining to the audience. Like, how could he have done that? The previous record is, you know what I mean? Yeah.

Whereas the agency is just very sophisticated. Doesn't do any like of that. They don't hold your hand. Yeah, they don't hold your hand, exactly. They respect the, they respect the audience. Okay, lastly. Having said that, I'm still kind of in the day of the jackal. It's entertaining still. Yeah, yeah, it's fun. But it's not as good.

I'm all in on Landman. It started out cheesy and silly, but I suggest you get on board. It's a good show. Okay. I, for whatever reason, I'm still finishing Yellowstone, and the last season has been pretty tough. Okay, well, I don't know why you're doing that. Stop watching that and start watching Landman. I had to, you're your pot committed? You're way easier at just letting it rip. I had to just finish just to know what happened. But I wish I didn't. You know the scene in Curb where Larry says that he's loyal?

He goes down with the ship. He hates some of his best friends. Yeah. That's like you with TV shows. Okay. A lot of people did mention that. Some of your stories last week were very curb-like. You did sound very Larry David-David-esque in some of them.

I did have a Larry David-ish-esque moment. Robin and I went to Peter Lugarfara anniversary. And I saw a fan of the show. and she was like, that's it? You're not going to like, I was like, what do you mean that's it? What do you want me to say? I said, thank you very much for listening. It was tight quarters.

He was passing by. What I'm going to, like, stop him and like, tell me about his life. What are you doing here? What does she want from you? Exactly. Okay. She's like, this is how you treat your fans? I was like, what do you mean?

I say, if I'm out in the airport, I'm much nicer. I'm much friendlier. And I say, hey, what you're going? How you doing? Not a man of the people. It's off the table. It's not good at small talk. Not in those situations.

Yeah, I agree. What else are you going to say? All right. We will be here for the next two weeks, right? We've figured out, we've made it in our schedule work. I think the Wednesdays are Christmas and New Year's, but there will be a new episode. We will be here.

Listen, the listeners show up for us and we show up for them. Yeah, Michael will be here with his Steve Jobs' Christmas sweatshirt on again. Yeah, this is Mike, this is Mike Franchise. It's Mike Francesa. Come on. It looks like Steve Jobs. It looks like Steve Jobs. sweatshred on you know. It kind of does, but this is, uh, this is the Pope. This is the go.

Okay. Animal Spirits at the Compot News.com. We love the emails. Michael probably responds to 75% of them and I'll do 25%. 95. That's okay. Are you sure? Anyway, send it to email. Thanks to Duncan and Team as always. See you next time. Thank you.