Animal Spirits Podcast - How to Pick the Winners (EP.371)

Episode Date: July 31, 2024

On episode 371 of Animal Spirits, Michael Batnick and Ben Carlson discuss: how small cap stocks got so cheap, how to improve your chances of outperforming the market, why investors are rushing into bonds, Americans make more money than you think, good news on gas prices, how the Fed can help the housing market, the best way to eat potatoes, the downfall of Nike, IMAX theaters, and much more! This episode is sponsored by YCharts and CME Group. Subscribe to the YCharts Advisor Pulse, and remember, get 20% off your initial YCharts Professional subscription when you start your free trial through Animal Spirits (new customers only). Sign up at: https://go.ycharts.com/animal-spirits Access CME Group's valuable educational materials and trading tools and learn more about what adding futures can do for you at cmegroup.com/animalspirits Sign up for The Compound newsletter and never miss out: thecompoundnews.com/subscribe Find complete show notes on our blogs: Ben Carlson’s A Wealth of Common Sense Michael Batnick’s The Irrelevant Investor Check out the latest in financial blogger fashion at The Compound shop: https://www.idontshop.com Feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation.   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

On today's Animal Spirits, we talk about Michael's old DVD book. Thoughts? Not bad. It's a lot of movies. The best type of potatoes. French fries? The polarization of Elon Musk and Twitter. We also discuss what people mean when they predict the end of the world but say,

I hope I'm wrong. And also, I give a pretty big dig at Michael for not watching the Olympics. Stay tuned. Today's Animal Spirits is brought to you by our friends at YCharts. They have a bunch of good free content at Y charts. We have a LinkedIn newsletter. I've been more active on LinkedIn lately. Remember Josh told us, hey, get on LinkedIn.

And we said, get out of here. And we did. Me too. And I have something to say about Twitter later in the show. That's a teaser. Okay. So check out the YCharts Advisor Pulse, which is updates on the market. So the most recent one, they showed that three stocks contributed to

49% of the S&P 500 gain in the first half of 2024. Can you guess what those three stocks are? Besides Nvidia. That's an easy one. Apple and Microsoft? Google and Microsoft. Close enough. They also had our own Nick Majulian on an update about how stocks perform in the election years.

That was good. I think white shirts also tease. We'll give a little teaser here. They're going to come out with another book of politics and investing and how politics impacts the market that we'll be using in any weeks and months ahead. Also, if you're attending Future Proof, Y Charts has a booth there. Check out their twos and data. Give it a test run. It's pretty cool.

Check out the YCharts Advisor Pulse. There'll be a link in the show notes. Remember, if you do not have it a subscription to Y charts yet, tell them Animal Spirit sent you 20% off when you first sign up. Balance your trading strategy by adding futures. CME Group helps you manage risk and capture opportunities in all market environments. Capitalized on around-the-clock access to highly liquid global futures and options markets across all major asset classes.

And with CME Group's e-mini and micro-sized futures and options, you can diversify your portfolio and manage your exposure in equity indices, interest rates, crypto, metals, FX, and energy. These smaller-sized contracts offer access to the same transparency and liquidity of the benchmark contracts with less upfront financial commitment. Access valuable education materials and trading tools and learn more about what adding features can do for you at CMEGroop.com slash animal spirits. Derivatives are not suitable for all investors. and involve the risk of losing more than the amount originally deposited and any profit

you might have made. This communication is not a recommendation or offer to buy, sell, or retain any specific investment or service. 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 is your summer going? By the time this episode comes out, it'll be August, the dreaded final month of summer. Are you trying to have small talk with me? I don't get them. I am. Okay. When do your kids go back to school? August 21st, which seems very, very early to me. I want to be an after Labor Day guy. I don't want school to take over my summer.

Yeah, I know it's regional. Our kids don't go back until, I guess, the first week of September. Yeah, that'd be fine for me. We're going back early. They're taking away like a week and a half of summer for me. My wife will be happy because the kids go back to school, and she's been just filling their time with camps and stuff to do, but I want summer to keep going.

I hate to say it, but summer's over. at least we're getting there. I was just talking with some of the fellas. We do one Giants game a year. And we're already booking the Giants game out in October. It has me thinking. Got to enjoy summer while we still have it. It's not quite over, but it's basically, it's basically over.

Talk about a filler small talk thing. Man, summer went like quick, didn't it? That's something people say. Tell me about it. All right, before we get to the meat of the show, we are looking for a full stack engineer. We've got something cooking in the hopper. If that is you,

do that job. I can't do the job. I don't even know. What does full stack mean? Front end, back end, design, develop, engineer. Are there half-stack engineers? Just like they're junior gold miners? Is there a half-sac engineer? I'm sure there are. Fronten only. Email us, Animal Spirits at thecompannews.com. All right.

All right. Good one from Michael Semblist. We've been talking about small caps lately because they've been doing really well. He has his eye on the market called the lion in winter. and there's some sort of analogy there that he shared on his podcast. But I thought this was really good charts. So, first of all, he shows the three-year rolling over and underperformance of small-caps versus large-caps. And you can see, it's cyclical. Makes sense.

But his point was, listen, there's a reason for this cycle happened for a reason. Small-caps didn't underperform just for no reason. It's because large-caps had higher-earned growth. They had better free cash flow margins. And all throughout. And he also showed that it's not just tech that did well. Small cap tech didn't do that well. It's just large cap tech that did well.

That was an interesting chart. He showed large cap outperformed small cap in every sector, except for maybe one, going back to 2010. Yes, which was interesting. And it wasn't, yeah, it wasn't like small cap tech did very well. And he shows that the thing is, as much as small cap is underperformed large cap stocks, international stocks don't even worse. So small caps have done okay.

It's just they haven't done as well as large cap. So his point is now, listen, small cap valuations look pretty juicy historically. Like they're looking pretty good. And the whole point is they're cheap, but they're cheap for a reason. And now you have to guess, like, does that cheapness give it a tailwind? And does it the expensiveness you have large caps a headwind? That's the trillion dollar question, I suppose. The gap between small cap stocks and large cap, the NASIC 100, whatever,

that's like, the gap was huge and it basically is almost all the way shut for a year-to-day performance. Kind of wild. That happened pretty quickly. I mean, we've had these head fakes along the way for the past 10 years or so where something else will do well. International stocks had an 18-month window. Small-cap stocks did. It's just can it actually sustain. That's the thing we haven't seen yet.

All right. So we talked a lot about the Bess and Binder studies last week. And I heard from some people at Vanguard who wrote a piece about this a few years ago. and said, how do you actually increase the odds of owning those stocks that drive the returns? Okay? Moliers, please. Okay, it's interesting. So they did all these simulations.

They looked at portfolios from one stock to 500 stocks out of the Russell 3,000. Wait, are we about to learn how to pick the winners? Well, just how to increase your odds of owning them. All right, listen to up. Pay attention. If you're dozing, pay attention. It seems obvious, but I think that this is kind of an important point. So they look at, again, so the Russell 3,000 University,

They did all these different scenario portfolio simulations, Moni Carlo, and they did 1,5, 10, 15, 30, 30, 50, 100, 200, or 500 stocks. And the probability of outperforming the benchmark is the highest if you own 500 stocks out of 3,000, as opposed to 1,510. So the probability goes up, the more stocks you won't. Oh, that's lame. What? It makes, so, but think about it. So the way to beat the index is the closet index? That is one way to look at it.

Obviously, you can outperform more if you have a concentrated. The whole point is that the concentrated portfolio just puts you out way more risk. Poppycock, I say this. Just pick the winners. You'll be fine. But it is kind of a thing. This is why closet indexing exists because it works.

If you want to be, remember Peter Lynch? Peter Lynch owns thousands of stocks. I would invert that statement. Clauseit indexing works because if you don't closet index, the odds of you severely underperforming increased by a lot. Yes. This may seem obvious,

but I don't know. I think it's important to note, though, like, if your universe is the S&P, you probably shouldn't own 30 stocks. You should probably own 300. This is like, I don't know who said it's better to fail conventionally, right? Yeah, but I'm saying if you want to increase your odds, that, it makes sense. To your point, I knew that you were going to be in the closet next thing. So here's how you pick the winner. Next time, I'm going to want you to set a reminder for me. Next time Netflix falls 70%, just tell me to buy it, please. I did. I literally did tell you. Okay. Did I not say it here on the show?

So I pulled this up after we talked about it last week or two weeks ago, whatever. And so going back to the history of Netflix, which is, I think it went public in 2002-ish, 2001, something like that. It's had 63%, 74%, 74%, and then 74%. And it came all the way back each time, obviously. 32% per year all time, 26% per year for the past 10 years. And that includes a 74% drawdown. Pretty amazing. What was with the 2012 crash? I don't think I remember the cause of that. Oh, yes, I do. That was the, that was they were canceling their, what were they trying to do? They canceled the DVD business. Right, which I was a member of.

I was a proud card-carrying member of the DVD business, where they send you- It's funny, it's funny that the market didn't like that. Right. Remember, they were going to split up into two companies, one DVD and one streaming. But in hindsight, killing the DVD business, of course there was a right decision. But at the time, the market punished them. Interesting. I forgot about that.

it makes sense. So one of my big things for the past, I'd say 10, 15 years is just that investors are becoming better, the behavior is getting better for investors. It's not perfect. There are still dummies out there who buy high and sell low, but on aggregate, people are getting better as investors. And Wall Street Journal has an article that investors embrace bond funds before rates start to fall. And they said that a ton of money is poured into bond funds. U.S. listed fixed income ETFs have taken in $150 billion through July, a record through this point in a year. When looking at mutual funds and ETFs together, taxable bond funds were responsible for nearly 90% of the net U.S. fund inflows in the first half, which is a wild number, ton of money going into bonds. And I don't know how much of this is people trying to, hey, rates are higher, the short end's going to fall if the Fed cuts, or it's just boomers getting defensive and saying I've got huge gains in my stock portfolio.

No, no, no, no, no, no, it's the first thing you mentioned. That's clearly what it is. Trying to time it? It's almost like the, I mean, bond yields are already. You're not like timing yet, like it's happening. The rate cuts aren't going to happen. Right. Yes. And the Fed has given you ample. I mean, obviously bond rates yields have fallen a little bit, but they show the yield on the Bloomberg ag, which got as low as 1% or so in the pandemic. And it wasn't that high going into the pandemic either. It was, you know, less than 3% for a long time. And it got as high as almost. six percent when rates went up. But now it's still 4.8 percent, I think, as of the last part of this chart. Still pretty good. So, I mean, everyone, you know, because we have to do this, said 60-40 portfolio is dead in 2022 because bonds and stocks both fell. But bonds are

going to give a better ride through the next downturn or recession or whatever it is or just rates falling, right? There's way more margin of safety. That's not like a prediction. That's That's math. Right. So I looked at the asset center management for the ag, which is $112 billion. So scroll down a little bit. And I did the chart before of like stocks versus bonds. And the ag is flat for the last five years, no return.

Plus you've got a 20% drawdown. But look at the, look at the assets. It fell a little bit in 2022. But in 2023, ever since, those assets have skyrocketed. 75 billion at the end of the beginning of 2023 to 112 billion now. There's a ton of money going into fixed income. And I think this behavior makes sense. People probably, it's rebalancing.

Well, you know why? You know why? Not to pat ourselves on the back, but a lot of this is advisor driven. Yes. In fact, basically all of it. Probably. Yes. That is true.

One of the big reasons for behavior getting better is people taking their hands off the steering wheel and say, I have an advisor do this for me. Yeah. Okay. This is kind of wild. Dalchun has tweeted, VOO has broken the all-time annual inflow record for an ETF. VO is Vanguard's S&P 500 index fund. 50 billion, and it's July.

Wow. I don't get it. Where is this money coming from? That's a good question. Like, honestly. So this broke up record, plus we're seeing record flows into bonds, but money market funds are still $6 trillion-ish. So you, what's happening?

Everyone's rich, man. If you own financial assets, you're rich right now. Yeah, I know, I know, I know, I know. But like, literally where is it coming from? Deposits? So how about this, baby boomers retiring and they are... Selling businesses and buying index funds? No, they're rolling over their 401ks and they're putting their money into Vanguard funds.

Is that part of it? Yeah, I buy that. And that's a way that's going to happen for a while. So that's actually another way that investors are going to become better behaved because there's a lot of crappy 401 plans out there with terrible funds in them. We see this all the time where a 401 plan. By the way, can we just give a plug? Yeah.

Dan LaRosa was on Ascent Compound last week. Dan LaRosa runs our 401K business here at Rit holds wealth management. He's very good at it. If you have a 401k at work or if you're a business owner and you might, want to refresh or a look over or, hey, am I doing this right? Reach out. We get questions all the time. Hey, our HR has us in this crappy 401k plan because their brother-in-law told them about it. And most of the time, HR is not doing this maliciously. They just don't know any better. So sometimes you need some help on your 401k plan.

Great chart from Tom Sarifagus. The tweet is this from Eric Balchunis, eating two. much boomer candy can lead to decay in ETF returns. Did we talk about the boomer candy story on here? That boomer candy is just funds with high yields? Yeah. Well, that was our talker book with J.P. Morgan we talked about. So they showed the percentage of equity ETFs that are beating the S&P 500 ranked by yield. And what it's showing is that, and this should surprise nobody, but it's still very interesting.

The higher the yield, the less likely that you're beating the SEP 500. And maybe not a fair comparison because I think by definition, a lot of these stocks, a lot of these, I'm sorry, a lot of these ETFs are by definition capping the upside. But it's a reminder, high yield does not always mean highest returns. In fact, it almost goes the opposite way. In fact, it does go the opposite way. No hedge is here. No maybe.

The higher the yield, the less likely you are to beat an index of stocks, whether or not that's the right bogey. Just saying. I think that this is also environment dependent, too, because dividend stocks are more high quality, blue chip names, they've been left behind. So during the next recession, it'll probably flip. 100%. 100%. But yes.

And the thing is, back to the behavior thing, a lot of the people who own those higher yielding funds or stocks are probably okay owning them because that yield makes them feel good about themselves, right? It's the guarantee in the box like a Tommy boy. I could take a shit in the box and stop a guarantee. on it. There you go. Okay.

I had Chart Kid Matt updates for me just because it's interesting and it's a kind of chart that just I was looking for surprising charts this

week for some reason. I was like, I haven't seen this updated in a while. You and I have both written blog posts about this. If you inflation adjust the price of gold,

it was been below the 1980 peak forever. And I thought, well, gold's making new highs and we've had inflation, so I wonder where we are now. It's getting there

but still technically below the peak, inflation-adjusted, which is surprising to me. The funny thing, and this is fun with numbers in a lot of ways, because I looked at the other day, if you go from 2000 when the S&P and NASDAQ peaked basically the start of 2000, gold is crushing them this century. Right. So it is kind of a change or start an end date kind of thing, but surprising nonetheless, correct? It is surprising, caveats aside, that going back 45 years, give or take, gold has had a real return of zero.

Now, doesn't your brain want you to say that it's only been 30 years since 1980? Like, wait a minute, it's that long? Did you see Elizabeth Berkeley put on Instagram the video of her screaming, I'm so scared, remember the classic Saved by the Bell episode? Jesse Spanow, yeah. That was 33 years ago. Okay. How does it make you feel?

I mean, I spent a lot of my summers. my brother and I talked about this the other day. Our kids are in so many different things in the summer. Camps and going away to things and they're packed with stuff to do. Every day it's a different thing. And when we were growing up, we had the TV. That's what we did. I watched Save by the Bell reruns and I watched movies on USA.

Like, I didn't have a summer planned out for me, anything. I know you did the camp thing when you were young. But my summer, maybe I did a basketball camp here or there, but I really didn't do anything. The TV was basically my babysitter when I was growing up. Yeah, we grew up with A.C. Slater and Zach Morris.

It's true. All right. One more to add to America is rich. This is from the Economic Innovation Group. And they did a study on wages in America versus wages in other developed countries. And they broke this out by states,

all 50 states versus all these other countries. and only workers in Luxembourg and Switzerland have higher wages than the lowest wage U.S. states. Hmm. Okay, so average wages in Mississippi are higher than average wages in Germany or Canada. All right, no offense to Germany and Canada, but that's kind of embarrassing. And no offense to Mississippi either, but. But then you take, like, West Virginia is higher than Austria or Denmark or Belgium, and these are pretty shocking.

I'm sure you could probably poke some holes in here. And the funny thing is they give another chart that says the reason and why do you think that our wages are higher? Just tell me. We work more.

We work more hours. So that's part of it because they take more vacations and stuff over there and they're more laid back. But isn't this, that's pretty surprising, is it not? Like the majority of U.S. states

have higher average wages than most of the developed countries around the world. I did not know that. Americans are richer than they think. All right. something we don't talk about enough as far as good news go, so I'm going to talk about it. Torsten Slok does his weekly economic update now for Apollo. I think he does it on Sundays.

And he shows this U.S. daily national average gas prices. And you look at it, it goes back to 2004. And it fluctuates all over. But really, if you look at it, if you draw a trendline on here on an average, right now at $3.5 a gallon, we're pretty much on or close to the average we've been since 2004. If you inflation adjust this, chart kid Matt did the price of oil inflation adjusted. 2008 inflation adjusted peak is $696. We're at 288 now. The funny thing is, 1970s inflation adjusted was probably double what the prices now for oil. That's how bad the 70s were. An inflation adjusted basis, oil prices have gone nowhere for years and years and years.

another chart. Personal consumption on energy over total personal consumption. So this is the percentage of money people spend on, our friend of the show, Telfth from New York Times sent us this one. Percentage of their budget, people spend on energy is the lowest point ever was 2020, which makes sense. But other than that, this is about the lowest it's been. There was a 2016 period, 2008. But look at how much higher this used to be. It's gone from 10% in the 80s to 4% now? We'll take it. It's not bad.

Good news. Ben, I just turned my head and saw somebody on CNBC that I haven't seen in a long time. And he looks significantly older. As I mentioned, I've seen. CNN on your TV all day, on mute, obviously. CNBC. Yeah, on mute. You said CNN.

CNBC. Close enough. No, most days my TV's not on, but today it is. And it looks a lot different than the last time I saw him. This weekend at the beach club, I saw somebody that I hadn't seen since college. For those of you who don't know, I went to Indiana University, was an early mid to the Kelly School of Business, not to brag. Got kicked out twice, also not to brag. So, yeah, I was not a great student, was not a great human being.

And the person that I saw at the beach club, I guess I even seen since the college. So it's, my God, it's 20 years. And so we're hanging out, talking, catching up. And he saw me with my kids and he goes, I just can't. It's so weird to see you and me as a functioning member of society. It is hard to imagine the friends you had in college having kids and having a real... I agree. Wait, so who's the person you saw on CNBC?

You didn't tell us. I don't want to say his name. It doesn't matter. All right. So speaking of TV, I got to ask you, just because I have a thought of my head, do you watch the Olympics? I can't see you being a big Olympics guy. Yeah, I'm not that into it.

I watched men's basketball. Okay. All right. See, I love, love watching. the Olympics. Okay, so the way that you just said it felt like it put down. It felt like it put that.

I'm questioning your Patriotism. I love the Olympics and I'm pretty sure that you don't care about it. It felt like to put down. No, it's kind of like I can just, you're not. It was kind of what. No, same more.

Go ahead. I had a funny, I just had some Olympic thoughts. I was watching handball yesterday. Handball? What the hell is handball? They have the little ball. And then it's kind of like basketball. but you throw it into a net.

It's a basketball and soccer combined. It feels kind of like basketball. Remember basketball the movie? I don't know how handball is a sport. It is. But my comment on it was both of the goalies were wearing Adidas Sambas. Remember those shoes that you wore in high school? Yeah.

And my whole point was like you can't wear Adidas Sambos and call yourself a real sport. That's like an intramural sport if you're wearing Sambos on the playing field. Is that fair? Yeah, there's no support on those sneakers. Give me a break. True. That's how you'd blow out your Achilles. with one of those.

For sure. By the way, it's funny you mentioned that. I did hurt my back tying Logan's sneakers yesterday. I was supposed to play basketball, and I was a healthy scratch. And I'm unhealthy scratch. Tying your child's sneakers. I bet you're going to go, ah, good fuck. Okay.

So you're going to hurt yourself off the court before you heard it on it. Okay. We just spoke with Mike Simonson earlier today. So that episode is coming out on Monday. Mike is an expert on all things to housing. Those are great conversation. Is it not? It was awesome.

Mike is the man. I love his weekly updates. And the whole backstory of how he started tracking data on a weekly basis and created his firm. It's really cool. I forgot to ask him about this phenomena. U.S. mortgage rates eased last week to their lowest level since early February. This is from Bloomberg.

While a further decline in home purchase application suggests the even cheaper borrowing costs may be needed to demand. So in other words, rates are coming in, but an index of mortgage applications decreased to the lowest level since May. So is this like, I wonder if this is more seasonality or more, we just need lower rates. Is it also kind of like an inflation thing? The whole worry about inflation is that it'll become ingrained in people's minds. And so they buy more now because they're worried prices are going to rise in the future. Is the housing market a thing right now where you're trying to time it and you go, yeah,

it's 6.8% now, but what if it's 6 in like two months if the Fed starts cutting? So I think that's the hard part with people. I don't know if buyers are getting that cute. But you might be right. This is why the Fed needs to cut, though. Housing activity getting this low is not healthy for this economy. We need more housing activity. It's a big part of the economy. The NAR had this presentation they shared with all these different slides.

And they looked at annual existing home sales that this year is the worst since 1995. And there's 70 million more people in the U.S. now than there were in 1995. But they also shared some other things about, like, sellers. can't wait forever. They said over the past two years, there's been 7 million new babies born, three million marriages, 1.5 million divorces, 7 million people turned 65, 4 million people died, 6 million people got new jobs on a net basis, and 50 million people switched jobs. Like, you can only hold it on for so long. Question about this. Are we still, or half of us still getting divorced? Okay, that stat is a misnomer. I think the divorce rate is

50% but most of Yes Oh, thank you, my wife New, uh, what is this? I thought she was bringing you a Starbucks. What's this called? Oh, title on the Registration, new registration.

Oh, for your car? Yes. Does it tell you how far underwater you are? I never know what to do with these. Okay, I got a letter. Response to this notice requested. Attention to Michael Batnik. This notice is to request that you please contact us

regarding mechanical coverage on your 2023 Jeep Wrangler that you service with us. Limited warranty. Is this a recall? I never heard of these letters. You ever have a car recalled? Yeah. If I'm going to be honest, I usually throw in the trash.

Unless it's something really important, it's more of a pain to bring the car in than it is to get it fixed. Limited factory warranty coverage. Yep, sounds like garbage. it's a lease yeah all right uh wait wait why is that data a misnomer what's a misnomer oh okay the divorce rate because technically the divorce rate is 50 percent but it's mostly people who've been married multiple times so the person who gets married four times and divorced three

times like the majority of the people who are getting the divorces are people who get multiple divorces all right so for people that can't remember where i heard that well okay so i say so a hundred of people who only are married once don't get divorced Right. I mean, obviously people do get divorced once, but most people getting divorced do so multiple times. All right. So if you back out the people that could divorce multiple times. Hopefully someone can send us the data. Okay. Here's a good one. Chiming in to support Ben's theory about housing market being squeezed for another decade or so, reasons. Step up in basis on capital gains. I have a family member who bought a small home in L.A. in the 70s for $150,000. They regularly get people's offering $2 million to $2.5 million. Despite the neighborhood around them having sold, knocked down, McMansions being built, they were refusing.

So exclusion from cap gains for a couple on a primary residence is 500K. They're saying, like, they have, basically they have a huge gain. But if they live in it, die, and then their daughter sell it, the step-up basis takes away the whole tax bill, right? Because you can only have $500 that you don't pay taxes on for a house. So they're saying that's an extreme example, but for a lot of people, that will be their inheritance they give to their kids. right?

And so the boomers are going to wait and wait and wait and hold on to those bigger homes for a lot longer the people assume probably. So they're disincentivized to sell the older they get. That's a pretty good theory. Pretty good. Ben, I don't know about you, but I've been using

the quarter app for the last two weeks aggressively. I think that listening to what these companies are saying gives you a much cleaner, not cleaner, a much more informed view of what's happening in the economy

versus some of like the official economic data points. I also like to, if I don't have time to listen to one of these things, and if I do it on two times and I hit the Q&A button. But I like pulling up the slides as well.

Because a lot of these really big companies have great slides. Yes. Right? So I like looking on the desktop and looking for the slides. I think Spotify is a cleanest slide deck. If I had to pick.

Okay. Lamb Weston, company that I had never heard of. I listened to their call last week. They sell potatoes. You could have given me 10 different things that they could do. Like, they're a sheet metal factory, and I would never would have known. I would never have got potatoes. This is in the profile from Whitechards, which, by the way, great way to just, wait, what does this company do?

Go to the Whitechard's profile. Lamb Weston is North America's largest and the world's second largest producer of branded and private label frozen potato. products, both by volume and value. The company's portfolio was anchored by French fries, but it also sells sweet potatoes, fries, tater, tauts, diced potatoes, mashed potatoes, and chips. That's a lot of potatoes.

I don't think we've ever had this conversation. What type of, you're out of spakehouse. What type of potatoes do you get? I'm a French fry guy. Oh, even at a steakhouse. Yeah, they get the big steak fries. Potatoes, like mashed potatoes, okay. Bake potato, okay.

French fries. I was about to say, this might be too out of a taker. Are potatoes overrated? Maybe this is recency bias. Maybe I'm just being influenced by the results of this company. French fries are one of my ultimate delights in life, so no. No, that's true. Properly rated.

Yeah, that's, I'm only. So what happened? People aren't eating much potatoes? I don't like fat. I don't like fat potato fries. Okay. Yeah, I'm a skinny potato guy as well, fry guys. All right.

So tell me if this sounds good or bad. Here's a quote. Here's how they open the call. We are disappointed by our fourth quarter performance. Our price mixed results were below our expectations. While market share losses and a slowdown in restaurant traffic in the U.S. and many of our key international markets were greater than we expected, we also incurred losses related to a voluntary product withdrawal.

We expect fiscal 2025 to be another challenging year. The operating environment has changed rapidly over the past 12 months as global restaurant traffic and frozen potato demand softened due to menu price inflation, continue to negatively impact global restaurant traffic. We believe the supply demand ballots were persist through much, if not all, a fiscal 2025. Do you think the stock went up or down? You know, credit to Tom Warner for taking it on the chin here and not like trying to spin it positively,

he was, he admitted it. Yeah, so the stock was down 20% of the day. That makes sense. You know, I have a lot of respect for people who were willing to admit they're wrong. My kids, a couple weeks ago, what were we doing? they did something where they weren't listening and my wife and I had to kind of let them know you guys haven't been listening well today

and we said you guys are in the way to get my kids really scared I'll just say you're in big trouble and I don't ever follow through with anything but I just say hey you're in big trouble and that whoa whoa what okay that only works with Midwestern kids I guess so

my son loses his mind when I tell me he's in big trouble but if I tell Kobe's in big trouble he just won't he doesn't even and my youngest daughter Kate started crying and she said I'll take the blame it's all my fault And I go, that's, that's, of course, my other two kids didn't take anything, but. That's very impressive.

Taking the blame is, that's a good personality trait. You know what's interesting about this earning season and just this year in general? A lot of the companies that are just getting blown up, we discussed this a few weeks back, are just the giant brand names. Yeah. Starbucks, McDonald's, Nike, Lulu. Can you blame it all on them hiking prices too much and getting out of their skis or not? A lot of it.

Is that too simple? No, I think it's a pandemic. Things were too easy. And they got complacent. Then we were reacting to an environment that was changing. And it's hard. Okay, so I talked earlier about Netflix. I said, tell me to buy Netflix if it's down 70%.

So I didn't seen. Nike is down almost 60% from the highs right now. Is that just another one of those? You have to buy a brand name stock like that when it's down so much. I actually already, I sold Nike on the Gap Down. So I own the stock going into the print, and I sold it on the gap down. On the one hand, I agree. Nike is still the brand name leader.

And so it's been de-risk, whatever. But on the other hand, it's really had a lot of really, really, really bad missteps. And there was an article that shared with you and Josh earlier highlighting management decision to go from wholesale to direct-to-consumer. And they blew a hole in their ship. And this sort of thing is going to take months, quarters, if not probably years. So they stopped going through as many store channels. Is that the problem? Yeah, they've, they f***ed all their biggest customers.

And they said, we're going to go straight to consumer. So I don't know. I just think that this is going to be a really bumpy road to recovery. So what, but the other point is like, well, when does an activist investor come in and like, de-rescue further still and make, I don't know. Yeah, maybe. but not for me. Not here, not now. All right, speaking of Nike. So yeah, they're on pressure or under pressure from OnCloud and Hoka, which I'm not a hoka guy. Do you have a pair ofokas?

I haven't gotten into any of the new sneaker brands. I wore some Allbirds for a little bit, I guess. I kind of grew out of those. I never did allbirds. What about, but Onclouds? Never got On clouds? I'm a Nike Adidas guy. Okay. I would say I'm like 90s. 90% Nike, but on clouds, I do have a few of those. New Balance, apparently, is like a monster. Sarah Eisen tweeted, New Balance CEO reveals over $6 billion in annual sales, making it the fourth biggest sneaker company by sales. Did you know that 40% of all New Balance sales come from dads with white New Balance

that's wearing jean shorts? Yes, it did. That's a, yeah. So I also don't think I knew that New Balance is a private company. Well, I didn't either. I would have assumed they're owned by Puma or Adidas or someone like that. Yeah. Ben, did you see Apple is coming up with a foldable phone?

What? Why? Doesn't Sam have one, too? So I'm sure people are asking for it to have a smaller fit for the pocket. Oh, yeah. What's next? Spotify is going to come out with a CD player? True. I will not be a foldable phone purchaser.

I just, how does it work? There was something about closing the phone, right? That's true. with you. Boom. Close it. My first little Motorola one. It was one of those tiny ones, you know? Yeah. Those are great. Is there going to be an antenna too? Remember antennas? Oh, yeah. My first one had an antenna on it. That's true. The funny thing is the antenna was like two inches. Like, did it really do anything? And it always fell off. But there was an antenna that you had to actually. Oh, yeah. Yeah, you'd pull it up. It would always fall off

too. Speaking of like old things, I was talking about my friends over the weekend. Remember back in a day, like a huge innovation was you had like the six CD changer in the trunk of your car. Oh, yeah. Like, oh, six CDs? That's true. Oh, yeah, and the boom box as well. Thanks are pretty good. These are 20.

Yes. Speaking of phones, this is a great PSA. The subject of the email was lost phone tip. Because last weekend, I almost lost my phone. We were talking about this on the show. Edit the wallpaper photo you have in your phone and add text. Add your wife's phone number and add If you found, please call Michael at whatever the phone number is.

I love this tip. I'm not going to do it, but I do think it's smart. It kind of makes you feel like a dog, though, right? The dog with a phone number on the collar. It's a good idea. I probably would never do it either. Listen to this nonsense. Subject line phone etiquette.

The other night, my wife and I were eating dinner at a sushi restaurant. We were seated outside next to the sidewalk in front of the building. Shortly after we were seated a young couple, early 20s, was seated directly behind us. after about five to ten minutes, we heard EDM music being played from someone's iPhone in our vicinity. My wife glanced around to see that this couple had propped up their iPhone in an empty glass on a neighboring table playing their own music at full volume. We were dumbfounded. My gut reaction was, wow, Gen Z is messed up. In what world is this an acceptable

thing to do? Have you guys experienced behavior like this in your own lives? Do you think we said something? We're both from the Midwest. They definitely didn't say anything. They definitely didn't say anything. This is outrageous. So one of my worst habits people have is talking on either FaceTime or speakerphone when they're calling someone and other people around. You can't do that. You can do it in your car on your own if you want to, but if other people around, you should get a ticket from the police. Like, you should not be able to talk on speakerphone in public. Citizens arrest? Yes. Boom. Ticket. I saw at the Food Fighters concert, there was a dude in front of me who had

his face time on the entire time. And I saw his wife which was just like doing the dishes. She was cleaning up the entire time. Do you think he's a very, very caring husband or he was in a lot of trouble? That's a good question. That's weird. Who would care to watch a concert through a phone? People do it, though.

People tape like the whole show. They never watch it again. Ben, I want to talk to you about a tweet I saw from Morgan, a tweet threat, I guess. It's only three tweets. Is that a thread? Probably not. Anything over two is a thread, right? Okay.

Morgan tweeted a disingenuous take is when someone predicting the economic collapse says, I hope I'm wrong. I would love to be proven wrong here. Of course. Like, right, that's a... Listen, I'm not a bad guy here. I'm just telling you what I... Yeah.

Don't shoot the messenger. I don't want to be right. I'm just warning you in case it does happen. If it doesn't happen, I was just trying to protect you. How about this? If you say, I hope I'm wrong, you really secretly mean I hope I'm right. every time of course but so so that's a thought that we've that we've probably had a million times right but i never thought about it this way and this was the interesting part he said

a similar take i heard recently that explains a lot of things is that some people like to be offended because it gives them an intoxicating sense of moral superiority i never thought about that and i was like oh yes that does explain a lot of the outrage the outrage porn yeah that's true I'm smarter than all you idiots because I'm paying attention. Yeah. So speaking of outrage and porn, Twitter, I don't know about you, but for me recently, I've been on the for you tab and I do not like what's happening. It feels TikTok-esque where it's like just serving you up the nastiest, shittiest, addictive

stuff. And for me, like, it's like a lot of violence. And sorry, I don't know if it's just me, but I watch it. I don't ever go on the 4U tab. If I do by accident, I immediately get off. I do not want to see, I don't care what they tell me. I want to have my own filters in place. So the 4U tab is dangerous.

I stay away. Because it is serving you like the, so I won't, I will not download TikTok because I know that I will just fall in and I have no interest in that. The 4U tab is doing it to me. And I'm like, I feel icky and I'm on it for like 10 minutes. I'm like, what am I looking at here? Just the most horrific shit on the internet. Anyway, so Elon.

If I could block one thing for my kids growing up, I was talking with some friends last week Like, when do you buy your kids a phone? My daughter's 10. She's already started asking, we're going to wait until at least he's a teenager, probably. But I wish that you could just say, I'm going to block all algorithms from you. You can go on social media when you're older, but no algorithms. No, I want to block all the algos. No social media.

It's too dangerous. Well, that, yeah, that too. That's going to be at least 16 maybe for social media. 18. So, speaking of dangerous, Elon is, in my opinion, a pretty dangerous person. Now, you might think this is a political statement. I don't view it as a political statement. I don't even think Elon's politics are all over the place, right?

He changes pretty quickly. But right now, he tweeted, he quote tweeted somebody who said, 76% of all personal income tax last month went to servicing the $34 trillion national debt. And Elon, who is the wealthiest man of the planet and one of the top, I don't know, two most powerful people on the planet, right? Like he's tweeted, America is headed for bankruptcy. FYI. FYI.

I hope I'm wrong. Now, he didn't tweet. I hope I'm wrong. I wish you did. So Twitter is getting killed. The estimated revenue is down over 80%. Have you ever gotten? This is pre-Elon and during Elon's reign.

Have you ever gotten an ad on Twitter and you go, they know me. They got me. Yeah, I don't get it. I've never gotten one. I've spent millions of hours on this platform. He also apparently tweeted a Kamala Harris AI fake video.

I don't know, man. I don't know what the... Now, listen, I know it's sort of lame to complain about Twitter and don't bite the hand that feeds you. We've obviously gotten a lot of benefit from the platform over the years and it's still a great place for certain things and meeting people and all that great stuff, but holy shit, is it bad too? Well, Elon Musk has become kind of a stand-in for politics as well. There are certain people who will defend him to the death no matter what and other people who hate him no matter what. and he's become a political figure almost.

No, but not almost. He's becoming like a lightning run. He's in the center of the universe. Maybe you get to the point where you have that much money and nothing else excites you anymore. It was like the SARS guard guy on Succession. Remember, he's like, making money doesn't excite me anymore. You know what excites me?

Losing money. Maybe that's his thing. Like, I already have enough money. Who cares if I piss away $44 billion on Twitter? I'm still going to be fine. all right story time ben uh i don't know if you know this about me but i've become a food influency what that means is i am the target of food influencers okay just please don't ever call yourself a foodie i won't i promise is that one of the worst word that that's worse than fam

i'm a foodie who doesn't like food yeah oh oh you like food whoa tell me more that's so interesting guess what i like music oh no way so the instagram algo has been serving me up a lot of recipes. By the way, if you want to know somebody, like really know somebody, you look at their magnifying glass on Instagram. Like, what are the recommended things? And I'm not going to tell you what the algorithm serves me because it's personal. But you can learn a lot about somebody from that, no? Okay. I don't go on Instagram a lot, so I don't know. I don't even know what mine would be. I didn't know you could do it. What's a magnifying glass? The search function. Okay. Gotcha. I assume it's magnifying glass.

I think it is. So I made something over the weekend that I brought to the beach. It was pretty hot, not to brag. There's people that were getting very interested. Can I tell you what it is? You cook your own food to bring to the beach? Not usually, but I had to share. It was so good. Well, it can't be, it can't be hot because you're on the beach. It's got to be something cold. Something cold. Okay. Something that might sound disgusting when you bring to the beach. Okay. This food is very divisive. It's a political lightning rod of food. Let's hear it. Either love it or you hate it. Egg salad.

Okay. Not an egg salad. I know people who love egg salad. You're, you're, you're, you're You're right. It's a love it or hate it. Potato salad, egg salad, all those kinds of deli salads. It's love it or hate it. Yeah, nobody's take it or leave it. You either eat it or you don't. But here's the thing. I don't eat it, yeah. So here's the thing. It was also, so it's like mushed up with avocados, pickles, lemons, and all sorts of other accoutrement. Oh, and dill. Dill was a key ingredient. Quite good. Okay. Here's another thing that is take it or leave it. I don't think about this week. Playing cards. Okay. You're either a card player. You don't dabble in cards. You're a card player. You're a card player or you're not a card? Because when my family gets together, we went away for a little family

vacation this past weekend. And we played cards every day, every night. That's the thing we do. We drink beer and we play cards. Are you a card player? Yes. You are. Okay. But, but, but do I play cards? You know how to play cards. You know how to play cards. Matter of fact, I might, I was talking with Jeremy Schwartz the other day. He's go, he plays cards. He's going to the World Series of Poker in Vegas. Now, there's like, there's not, like, there's the main event and there's like a million in other small games, I might go with him next year. See, poker's actually the one game I don't play, but I have the greatest card game in history

that I'm going, I'm going to bring a deck of cards to future proof. We're going to play a card game. I'm teaching you a new card game. Trust me. I'm going to make it happen. What's the name of the game? It's just called the one card game. That's all I'm going to say.

Okay. Did you make it up? Because I don't think I like that. No, I didn't make it up. Okay. I don't make up game. Ben, I got, I got truck. by Stubhubh recently. I forgot to tell you.

How much money have you lost to Stubhub in the past 12 months? So this was in April, this nonsense, where they charged me five times for selling tickets. Now they ended up only charging me, I think twice,

and then there was an investigation. I got charged like three weeks ago out of nowhere. I got a $14,000 on charge or whatever it was. So you know what I did? Called Amex. I said, I explained this situation.

They understood. They canceled the car and they're disputing the charge. You need an Amex on your side Yes, it's worth a... I've had Capital One has told me No a few times on some of those But it's worth having the conversation

Yeah All right, a couple of... So we went to this place in the middle of nowhere in Ohio Where they have all these caves And hiking and waterfalls It was beautiful And we were kind of the middle of nowhere So internet basically didn't work

We stayed at a cabin And I often think How boring was life If you think in the past 150 years or so, before then, for tens of thousands of years, people didn't have sports, they didn't have internet, they didn't have TV, they didn't have games, they had like no form of entertainment. What did people do to keep themselves from being bored before all this stuff existed? And I think most people probably just sat and stared at the fire that was keeping

them warm. Because we had an outdoor fireplace. That is great. I love to do that. With chairs around it on the big deck and it had a chimney so the, and the chimney worked great You didn't get any smoke at all. And there is something to be said about fireplaces just. So sitting around, telling stories, drinking beer, listening to music. And we did it every night. And is it possible fireplaces are underrated? Can fire be underrated?

Is that a hot take? Not possible. Get it? I know. That was clever. But I don't know if you know this about me. I've spent hundreds of hours borderline thousands in front of a campfire at the cabin upstate. That's like what I like to do.

And you have a little fire pit in your backyard. Front yard. Oh, in my backyard. Yes, my own backyard. True. Yes. Which you sent me a picture of the other day, and I totally forgot that you had, you literally have fake turf in your backyard. Yeah. Which is, which is crazy to me. Do you have the little pellets like at the football field one? No pellets, no pellets. Okay. Yeah. Oh, wait, one more thing about going, so when we get to get my family, we are a family that likes to have fun.

Like I said, we play cards. We drink. The first night, everyone always goes out pretty hard, you know? Like, we're staying up late. We're drinking. We're by the fire. And when you say my family, I want more information. How extended are we talking? So every year, my parents plan a little trip, and it's my whole family with my wife and kids, my brother, his wife, and their kids, and then my sister and her husband. So there's 15 of us. Okay.

So it's all just me and my siblings. That's very nice. I feel like that's a very nice thing to have. Yes. But we go out hard at the first night. Now, this is a middle-aged thing. Second night, everyone goes to bed early because you can't do it two nights and are on middle-age anymore. Nor do you want to. Right? The staying up late, the drinking that you can't do it

two nights and all is hard. I went out Thursday, Friday, Saturday. Speak for yourself. Still got it. Although I'm much younger than you. Listen, I, and the thing is, I still get up early with the kids after a long night like that. I can hang that way and go hiking and all that stuff. Sam Rowe tweeted, this is a great chart from Charter. Can streaming save the music, music biz, and it's showing U.S. recorded music industry revenues, and vinyl, obviously went away, cassettes, next, CDs, next. And in there, Sam spotted ringtones. Do you remember that? No. We used to, for kids I don't know. I never had a, I never paid for a ringtone. No way. As a guy who doesn't use emojis, you think I was going to pay for a ringtone?

Yeah, I don't think you did. I feel like I might have, but what ringtone would I have paid for? Some sort of like 70s rock. Either Billy Joel or Dr. Dre. The thing is... I don't know. I don't think I paid for... The whole, like, 1990s CDs and DVDs, that was, to me, seems like a one-time deal.

That Fed is never coming back in terms of a revenue generator like it was in the past. Oh, speaking of that. Hang on a sec. Duncan, stop recording. Press pause. One sec. Is that a CD book? So, I told you, we cleaned up my closet in my office.

Look at this thing. Robert goes, what are you doing with this? I said, yeah, don't touch my DVDs. Oh, those are DVDs. I thought they were CDs. Do not touch my DVDs. Oh, man. Speaking about nostalgia.

Holy moly. Okay, look, you know what? The first page, I haven't opened this up in 20 years. What a great representation of who I am. This is heavy I see aliens Okay Olly G

Oh Oh these are Oh Ali G 8 mile aliens and airplane I had these enough blood to order Wow

Now my guess is Back in the day You had a DVD tower 100% Giant Everyone had one of those Giant Every

Can you know what I would do Oh man Delirious Eddie Cisorhands Um Oh man this is fun Remember, so at Blackbuster, like, they used to sell, like, to use DVDs for 20 bucks or 10 bucks or whatever it was. I was all over that.

Think of how much more expensive that used to be, too, than buying a streaming platform today. But you know what's interesting? The price, like, we spoke about Blu-Rays at Walmart or whatever. They're still, like, $24. Yes. I don't know who's paying for those. Who? Somebody is.

All right, Ben. Recommendations, I want to talk about for a second, about a little stock. that I bought a couple of months ago. IMAX supported the movie industry in more ways than one. Out of all the movies you go to, how many times do you go to IMAX versus regular? Because it's harder to, sometimes it's harder to get.

Like, we're gonna see, my wife, the kids are gone this week at camp. My wife and I are gonna see Twisters and I want to see it in IMAX. Yeah, yeah, that's an IMAX movie. I don't know, I don't know, four times a year maybe. All right, they put out of release. Deadpool and Wolverine scores biggest IMAX opening weekend

since 2002, excuse me, We're $36.5 million. Ryan Reynolds. I don't think I's so hot right now. Who is? Ryan Wendell's? Biggest IMAX July opening ever. Biggest IMAX R-rated opening weekend ever.

Biggest IMAX opening weekend of any movie since Avatar The Way of Water. And biggest IMAX opening weekend for Marvel movies since Spider-Man, No Way Home. Pretty good summer for movies. So listen to this. Deadpool and Wolverine open to $19.1 million. This is for IMAX. Good for 9.3% of the domestic box. office on approximately 1% of total screens.

So it's a premium experience. A matter of fact, the Walshut Journal wrote an article about IMAX's success. They said fewer people may be going to the movie these days, but those who do clearly are willing to pay up for a better experience. Oddly enough, though, the box office downturn is proven it to be another flex for IMAX. So it shows a chart of the share of Demex's box office per year. And it was 3% in 2018, and now it's pushing up against five percent. people like iMacs i get it you're not going to the movie theater that often but when you do

you want the good speakers you want the big screen shelf that makes sense to me anyway Deadpool and Wolfrey monster so how is a stock doing look how is a stock doing it's breaking out oh it's up 30% this year uh Friday Saturday and Sunday 444 million dollars wow 211 domestic 233 worldwide or international pretty wild huh I will be watching it when it comes out on streaming. I'll probably watch it when it comes to. I love, I really liked the first two. Okay, I just doesn't do it for me, but all right, Ben, what do you got?

Okay, my son is a huge fan of the Planet of the Apes movies, the new ones. So there's been four or five of them, I think, now. And so we just watched the Kingdom of the Planned of the Apes last week. I had to buy it for my Amazon because he couldn't wait. The funny thing is, these are a kind of move that shouldn't work. And it actually is not, it's kind of entertained. My son loves them. They're just okay.

First three? Oh, yeah. I watched them with them. They're excellent. They're actually, it's pretty, for this, for having four of them. Dude, stop hedging. Don't beat around the bush. They're great movies.

No, I'm surprised how good they are. That's what I'm saying. Okay. But wait, so how was the kingdom of the planet of the apes? It was good. I liked it. Because it's like a reboot. It's a new storyline.

Well, it's into the future. It's further along, yes. It was, it was well done. Okay, so I finished the presumed innocent show, which I thought was good. I was actually, I love the who-done-it kind when you know they're going to tell you on the finale. Like, I was genuinely excited to watch the finale. I thought the last two episodes were killer.

You could pick Nitz if you wanted to with this show on like the ending. And, but the night before the finale of the show, I had never seen the Harrison Ford movie before. So I watched the Harrison Ford original movie. Okay. Is the twist the same? It's not the same. Oh, interesting.

But the movie twist is really good. I was, I didn't, I'd never heard of it of the ending. I knew it was a twist. and it still surprised me. I thought it was really good, which my wife said was unfair going into the finale of the show that I watched the movie first

because I had preconceived notions because I guessed who did it in the show. You did? I picked the eye, yeah, I guessed it. But my wife was like, that's not fair, you saw the movie first, and I'm saying, well, it's a different... Anyway, so it was good.

Wait, you know what they did with President of Disset was interesting? They dropped it a day early. Oh, did they? Think so. Yeah, good show. It could have been a couple of episodes less, but I don't care. I love horror show.

We spoke about that on episode four. just like, come on, it just was drago for no reason. It ended. It had to be six episodes. Most of them do. All right. I've been reading the book Heat 2, which is both a sequel and a prequel to the movie heat. And I love the movie. So I'm a little, I'm a little nervous about these things. The book's actually pretty entertaining. And I think it sounds like like they're going to make a movie out of it. And I think I'm okay with it. I say, do it. I'm surprised how much I enjoy the book. Well, they just started filming?

I think they'd talk about it. Okay. But I watched... Oh, Inside Out 2 is now the highest grossing animated movie of all time. Crazy, right? Box Office is back. That is wild. I watched Horizon.

Oh, and? Took me three or four settings, seating. It was fine. Like, it wasn't great. It wasn't... It was a decent Western? It was whatever. I'm not a big Western guy.

I just was more curious than anything. Will you watch the second one? It was kind of boring. No, I'm not going to watch the second one. Okay. And I'm not surprised that it bombed, and I'm not surprised that they pulled the second one. It was just a whatever,

I don't know, what is he thinking? It was like, I'm going to make dances with walls, but way worse. And it wasn't like dancing with, it was just a Western, but was not compelling,

really not much happened. I think it took me like three or four settings. So I can skip it. Oh, yeah. A comfortable, and a comfortable skip. All right. I saw a tweet or a meme,

on Instagram, and it was like, my 10-year-old can watch this movie in 1995. Okay. And I'm looking at the movies. I'm like, that doesn't look like 1995. So I spot-checked it, and it actually, they weren't 1999-5 movies. Point was taken.

But last week, I was talking to you about, like, Venom 3, which is rated R and can I or can I not take Kobe? So I want to talk to you for a second about some of the movies that I saw when I was six, seven, and eight years old. So in 1991, I was six years old, and that's what Terminator 2 came out. And I remember vividly, my dad rightly saying, credit to him,

this movie is not for you. And I cried. I was really sad because I remember my brother and his friend went, I couldn't go. Terminator 2 was 1991. Did you see that in 1991? Like I said, you're a lot of others.

I saw when it came out on VHS. I didn't see in the theater. All right, so this is what I did see. I did see these movies in 1992. The bodyguard, which I do want to rewind, watch, because I don't have any memory of that, but I did see it. And under siege.

Speaking of Kostner. Under siege, that is wildly inappropriate for a seven-year-old. Where the girl jumps out of the cake and the laying guys die, yeah. All right. Passenger 57. Remember that one? Always bet on black. Universal Soldier.

Is that a Van Dan movie? And Drago. I'm drawing black in his real name. Duff Longgren. Remember the ears? Oh, yeah. I saw that when I was seven. And The Lawnmower Man.

I don't remember that exactly, but I know I saw it when it came out. 1993. Demolition Man. So in 1993, I was eight years old, Kobe's age. Demolition Man, Cliffhanger, alive, fire in the sky, the good sun, the program. The program is, I should not have seen that. Falling Down. Do you remember that movie?

I used to love that movie for, I don't know why. And then on the complete other side of the spectrum, I also saw Homer Bound, free willy. Those are more by speed. So I don't know where to draw the line. Like, I was seeing wildly inappropriate stuff, but I don't think I want Kobe seeing R-rated movies at this age. She feels way too young.

It's the language for me. My son, he sees one of his movies and he parrots the language. My daughter, my oldest daughter, is just so averse to bad language, and my son loves it. So if he hears it on a movie, he's going to use it. So we're like, you can't see Twisters if you keep using bad words, dude. And

he's like, no, no, no, I want Twister so bad. I don't know if that's cursing in Twisters. There probably is. Okay. Anything else? Last thing. We just mentioned a podcast with Mike Simon's inputs, but in Twisters, it's interesting. The bad guy is a landlord.

He's buying up homes after the tornadoes destroys them. And it's now in pop culture. I can see that. People really hate homebuyers. Okay. That is interesting because sometimes the economy seeps into popular culture. It would be interesting if the housing market does in. some way. Yeah. Interesting. Okay. Thanks to the production staff, as usual. Duncan, John,

Daniel. Hope everyone enjoyed their summer. Yes, it went way too fast. Email us Animal Spirits at the compound news.com. We'll see you next time. Thank you.