Animal Spirits Podcast - Is the Stock Market Getting Ahead of Itself? (EP.293)

Episode Date: January 25, 2023

On today's show we discuss why the narrative changes for the economy on a weekly basis, the snapback rally in the stock market, trouble in the car market, the boom in entrepreneurship, putting tech layoffs into perspective, why the housing market might have a floor under it and much more.   Find complete shownotes on our blogs...  Ben Carlson’s A Wealth of Common Sense  Michael Batnick’s The Irrelevant Investor  Like us on Facebook  And feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation.      (Wealthcast Media, an affiliate of Ritholtz Wealth Management, received compensation from the sponsor of this advertisement. 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. 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.)  Learn more about your ad choices. Visit megaphone.fm/adchoices

Today's Animal Spirits is brought to you by YCharts, financial advisors. Listen up. There's this new tool that they built. It's called scenarios. And what you can do with this tool is you can look at different scenarios, just like it says. If you want to think about... Good explanation. Investing money either with DCA.

Average. Dollar cost averaging. Lump sum. Contributions. What if this? What if that? Portfolio withdrawals, all that stuff. So I guess previously, you could have done this. I mean, we've done this a million times with Excel, pain in the butt. This makes it very easy. If you want to learn more, and if you're a new subscriber, you want to get 20% off a discount off the subscription, visit Ycharts.com. Tell them Animal Spirits sent you. Welcome to Animal Spirits, a show about markets, life, and investing. Join Michael Batnik and Ben Carlson as they talk about what they're reading, writing, and watching. Michael Battenick and Ben Carlson work for Ritt Holtz Wealth Management.

All opinions expressed by Michael and Ben or any podcast guests are solely their own opinions and do not reflect the opinion of Ritt Holt's Wealth Management. This podcast is for informational purposes only and should not be relied upon for investment decisions. Clients of Ritthold's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. We're going to start the show off with two quick announcements. One, future proof. We're back.

The registration is now available. What is future proof? Ben, how would you describe future proof? It was the greatest financial event I've ever been to in my life. It's beach, food, booze, and some music hanging out with us and a bunch of finance talk. And it was awesome. It was the most fun I've had at a finance event in my life. life. And I think the fact that we've done it once already means that next year is going to be

even better. Thousands of people will be there. Some screws to tighten up. Tons of advisors, big speakers, all that stuff. So registration is now available. We'll link to this all over the show notes. You'll see it in the future. It's in September. I don't know the exact dates, but it's not hard to find. So we are excited. Can't wait. And we'll see many of you there. All right, that's number one. Number two, Ridholt's wealth management is looking for a power planner, a junior associate, a junior advisor, whatever you want to call it, there's a catch. We need somebody who's in the Pacific Northwest. That is the upper left-hand corner of this great country. Seattle, Portland, those kind of areas. If you are in and around that area of the country and you're looking

to grow into an advisory role, it would help if you had a little bit of experience. If you're interested, you know where to find us. Hiring at RedHaltzwalth.com. If it's para planner and paralegal, what else does para get put in front of? Is that it? Parachute. There you go. That's pretty good. Paranormal.

All right. You had a piece. Wait, I had one more, paranormal. Okay, paranormal. There you go. Not bad. I can keep going. Just, no, I can't.

I bet you saw all 12 of those movies. Well, I stopped it for. The first one was a classic. Truly scary. You had a piece last week, I believe, called the narrative vortex talking about how we're doing the Snipsnap back and forth. If stocks are down, oh, that means recession is imminent. Week to week.

Day to week. Stocks are up, but that means inflation is falling and we have a soft landing possibility. And we did this a little bit last year, but it feels like this year is going to just continue where we go back and forth between no matter what the stock market does or the bond market, people are going to be looking at that and trying to figure out a signal to, okay, this means this regime is over, this is the new one, and that's what people want. They want to have some finality to the markets. They want to know, okay, this is it.

One point there. I agree that the first half of 20, 22, probably the spring time into the summer where you had a lot of bear market rallies, there was a lot of back and forth. But I think maybe towards the second half of the year, I don't want to say reality set in, but the narrative was firmly. It was a one-sided narrative. This is bad. Yeah. Inflation is bad. It sure is the one side of nerve. But now that we've bounced so much and inflation is coming down and rates are coming down and stocks are bouncing, we're back to, we're bouncing all over the place, ping pong balls. And the thing is, as inflation falls, if it continues to fall, both sides are going to be able to hold on to their argument as hard as they can because, okay, it's falling because things are getting better and this is a soft landing. Or no, no, no, it's falling because this means you're going to recession. You're probably not going to know for a long time what this actually means. So far be it for me to make a short-term market call. It's not what I'm doing

here, I'm just throwing it out. Just want your opinion back. Just asking questions. Does this bounce warranted? Feels like it's a healthy size bounce. Too far too fast? How far away off the bottom? How far off the lows? I want to say October 12th of a low. Is that fair? October something. No, no, no. I'm just saying in January. Oh. So the stock market is up 5% year to date? So the NASDAX up 8%. It's January 24th. Strong month. Too much? Warranted? It was down 30% last year. Big moves don't really surprise me either way anymore. How about this? Let me be specific.

So one of the stocks that I own, and this is not to brag, we don't brag around here, but Facebook, for example, I'm using this as an example. This stock over the last- You own Facebook? Yeah, but $2.99. Okay. Maybe I should do some more brag, and you don't even know that I own Facebook. Since Facebook bottomed, when was this? Let's go back to November.

Since Facebook bottomed, it is up 58%. And actually, I think I literally bought the bottom. Again, it's not about me. It's not about me. But my question to you is, what sort of earnings or maybe reduction in spending or guidance will Facebook have to deliver in order for the stock to not go down 11%. My point is, there's a lot of stocks like this that are up a massive amount off the lows. Is it justified?

It's hard to tell because some of these stocks are down so much. Facebook, you said, is up 58%. it's still down 62% from all-time highs. So you say, man, that's a huge bounce. But you also got to say, well, that's coming off of a very low level. Same thing with Netflix. Netflix has probably doubled at least, maybe more. You said it not me.

Netflix, another stock that's in my portfolio, my repertoire, my wheelhouse. Actually, on T-Caf last week, I said I'm fully prepared for the stock to fall 8% after hours just because it's run up so much. Well, it's up 13% since it reported earnings. What do I know? I guess maybe this is just luck, but they, They were both down 76% from the highs at their low. Now, Netflix, this is different because Netflix legitimately smashed expectations.

I have a very hard time seeing Facebook with an upside surprise. I think it's going to be harder to gauge the stock market based on individual names that are down 75% or 80%. Good point. How could expectations be any lower for a stock that's down 80%? So I think it's going to be hard to gauge what that means for the market for a while. If you have a stock double after it's down 80%, it's still got a long ways to go to make all the money back. Okay, here's another example of stocks having a heck of a run. Carl Keptaneda tweeted, this looks like it's from Deutsche Bank.

Yes, it is. Best start to the year for the year of Stock 600 since Bloomberg data began in 1987. It's up 8% in just the first three odd weeks of the year. I saw data this morning. I haven't had a time to check on it. I think it was PMI data in Europe that's actually accelerating. So maybe Europe is avoiding a recession. Do you know what the total return for European stocks is for the past 10 years?

40%. Okay. EFA is up 60% of the last 10 years. It's 5% per year. It's not terrible. It's not U.S., but... But I'm saying, it's not like stocks overseas have been crushing it. The fact that they're having a big snapback, I mean, the S&P is up over 200% over the last 10 years.

Admittedly, this is short-term thinking here. I don't condone this. Just asking the question. So here's another example. XHB, housing-related stocks, is on a monster run, and we're going to talk about some housing stuff later today. Is this run too much? Maybe not.

Maybe. I just think if you get violent downturns, you're going to get violent upturns too. And it's going to be hard to know, is this the weird deadcat bounce thing or is this the true bull market? I don't know. True. By the way, this is a waste of time. But listen, we're just talking.

This is what the podcast is about. You and I would have done this on the phone before we had a podcast. Just try to have some fun. Individual investors have been doubling down on Tesla. They spent more money on Tesla in the past six months than in the past five years prior in January. Net purchases hit a one day record. That's kind of crazy. And I guess they're buying what Elon's been dumping.

So the stock got as low as $100, and this was like massive, massive volume. The stock bounce. If they really wanted to have NFTs that worked, couldn't you do an NFT of a stock share saying, I bought this stock share from Elon Musk when he was selling it to build for his position after he bought Twitter. I love it. I love the use case. Tesla got as low as 100 and it bounced to 140, so 40% run in like, what is this?

I don't know, 10 sessions or something. There's another stock that was down 74% of the lows. Still down 65%, even after that, huge run-up. If you bought it at the bottom, congratulations. If you've held from the top, that 40% bounce doesn't feel quite as great. I don't know how much Wayfair fell. Was it 90%? I don't know if it was one of those, but the stock went from 30 to 60 in three weeks.

So there's a lot of these. I think, Ben, that's a good observation. Things that go down so much can go up so much. It's down 92%. I think Wayfair for us has kind of replaced Amazon as the go-to place if we're looking for furniture to buy online first. Do you use Wayfair a lot or not? I do.

You've been in my kitchen. I've got the island with the bar stools, and we buy relatively cheap ones on Waysfair because they get destroyed. Yes. You know, we throw them out every two years. That's one good personal finance hack for if you have kids. Never buy expensive furniture.

It's a waste of money. It's going to get destroyed. So, yeah, I'm a Wayfair customer. I'm a friend of leather. We have a leather couch. The kids just beat the crap out of it, and leather holds up really, really well. You know, my couch stinks.

Get a leather couch My couch is awful Just not comfortable At all You have to have a good couch You have to But that's the thing You can't get a cheap couch

No That's true We got a leather one though And it held up really well Speaking of home decor I think my wife Was trolling me last night Invertently

She sent me like somebody Did a DIY mud room It was like 600 bucks By the way Ramp was talking to me about this He said Tell me exactly what you paid for So I told him

And he goes bro What the fuck did you pay for Materials on that pick or maybe $1,500 max. All right, what do you want to do? What am I going to build my own? You don't read the comments, but some of the YouTube comments last week said,

it was a nice surprise to hear you guys talk about the markets on a mudroom podcast. All right, I think I'm done with that. All right, don't know. I think we're done. All right, Jeffrey Patak, Vanguard's U.S. funds and ETFs continue to gather prodigious sums from investors. $83 billion in net inflows in 2022 alone,

but growth does appear to be slowing. The fund's 1.1% organic growth rate in 2022 is a slow since 1999. Do we have to call Jeff Hot for using prodigious as a word? Is that like granular? Prodigous. I got to be honest. I'm just asking.

I don't think I know what that means. I mean, I have decent reading comprehension. I could gather from what he's saying. But if you said to me, what does prodigious mean? I would say... A lot. Yeah, I don't even know what I would say. So what do you think?

Any thoughts about Vanguard? Are they in trouble? A Vanguard's best stays behind them? Analyst asks. No, the growth had to fall off eventually. It's coming from a much larger position. No. Vanguard's still fine.

Okay. Warren Pye's tweeted. The China reopening appears to be real as time. there's data. When he was on TCAF, I think he said he's got a guy that builds this. I think that's what he said. Oh, never mind. It looks like he sources somebody else data provided by.

Whoops, I'm sorry. All right, anyway, China flights ramping now higher than at any point in 2022. It is interesting how quickly, I guess not being a China expert, but how quickly they can just flip the light switch on and off to be like, no, no, no, we're shutting down completely to open. The stuff with us, it feels like it takes a little longer. I was going to talk about this later, but the guy from Moderna was on. in CNBC last week, talking about how they pretty much had the vaccine done before they

even had the COVID name. They had a couple cases, O'Darna got it. They had this name. Duncan goes, Mike, give us your stock picks for February, exclamation mark. But can you imagine, I don't know what would have happened. The pandemic itself was not great. The whole time dealing with it, the waiting. I think what happened was probably about the best case scenario in terms of how that ripped through everything. And then we got the vaccine so quick. Can you imagine if it took like five years to get a vaccine? What would have happened? No. It's a great point. How awful. Eventually people would have moved on. There probably would have been some rioting. I don't know about that. Things would have got really bad.

I don't know if people would have moved on. Like if there was no vaccine, it just would have been two sides, one line. You're either not moving on or you are moving on. That would have been ugly. I think there are no counterfactuals. You don't think about it. But the fact that we have just moved on after the vaccine happened and we've put that time past us, I don't think people realize how lucky we got. Great point. Here's a question from someone, a professor emailed us. That this is a good one.

For my students, trying to come up with reasons why 2022 is not a big year for corporate or hedge fund blowups or bankruptcies, notwithstanding the worst year for stocks and bonds since Great Depression, basically asking stocks and bonds both got hammered. Why were there no fund blowups last year? I don't have a good answer for this. I have a good answer. The corporate side of it is easy. They were flush with cash.

Yeah, the corporations were fine. Yeah, they gorged. They borrowed at low rates, yeah. Here's another answer. hedge funds, at this equity hedge funds, long, short hedge funds. This is a huge overgeneralization, but go with it. They buy cheapish quality and they short expensive. So 2020 should be a good year for that.

It was a good year. If you were doing anything but buying fan mag, the last decade has been brutal. So 2022 was finally a time for them to shine. I guess you think of a company like Tiger that was down, what, 60% or something? Was that not a blow up? They didn't go bankrupt. But the thing is, they had such a big margin of safety because they had such huge returns leading into that 60% decline, maybe that was it. If you think about it, besides crypto,

there's not a ton of leverage in the tech space. Venture capital is not using leverage. If something goes to zero, it goes to zero. It's not like there's a cascade of other problems that are going to domino from that. You could say arc blew up. In fact, I don't know how else you would describe, but it did blow up. True. But how many hedge funds look like arc? Zero. It is surprising that just having both of those things not worked, that there wasn't some over leveraged hedge fund that got wrecked. Okay, out of the economy. I talked about this a little last week.

Well, hang on. I'm sorry. One more thing. Tiger's hedge fund, I don't know what's inside of it, but they were down a ton. Probably did kind of look like Arc. Didn't I mention Tiger like two minutes ago? Sir, you were talking about the private one. I'm talking about their public hedge fund.

I thought it was together. I thought their public and private is one fund. I don't think so. But that's what they did. I thought that's all the hedge funds do these days. They have public markets and then they invest in venture capital. All right. So one of the things that we hear about the economy is that monetary policy works on a lag. Maybe that's why we haven't seen huge problems in the economy yet in the labor market

because they raised rates really fast, but now it's been a few months and now we're going to start seeing this. I did this little thing where I looked at Fed funds rate and compared to the unemployment rate. So when the Fed first, it's kind of hard to believe, their first rate hike was in March of 2022. Not that long ago, less than a year ago, for how fast that they raised rates, the unemployment rate was 3.8% at their first raise. By the time they got the 4.5% it's 3.5% for the unemployment rate. So as they went from basically zero to 4.5%, the unemployment rate went down. So we could say monetary policy works in a lag.

Or maybe, just maybe, the monetary policy doesn't work like the Fed wants it to or thinks it does. What if that's what we're learning now is that what they think monetary policy does, it doesn't work like they want it to. I think we kind of learned that in the... This is a true story. It happened right here in my town. One night, 17 kids woke up, got out of bed, walked into the dark, and they never came back. I'm the director of Barbarian.

A lot of people die in a lot of weird ways. We're not going to find it in the news because the police covered everything all up. On August days. This is where the story really starts. Weapons. 2010's when they kept interest rates at zero to try to get inflation to go high and it. didn't. And now maybe it doesn't work the other way either until they get to like, I don't know, 7% or something. Listen, it's not a conspiracy to say that higher interest rates at a certain

point will rect demand. Yes. I don't know. I think it does matter. Look at all the blowups it caused. An asset price is not in the real economy. But again, you just say this, does it work on a lag? Yeah, I think it does. But that's what I mean. Maybe it's more important to asset prices than the actual economy for a while. I think it just, it hits asset prices first. Could be. Oh, we got retail sales. Oh, man, this seems like a year ago. So we got retail sales on Thursday, and the market fell. And it was up. And PPI came in soft and expected because demand destruction.

Well, bad news is bad news again. Well, guess what? Again, back to that narrative vortex. I'm looking at the chart of the SP 500. Candlesticks, of course, so I could actually see what happened. Stock had a rough day on Thursday. Fell more on Friday and got it all back. We go back and forth.

The thing is, though, if you look at retail sales, I didn't put this in the document. If you put it on white charts, it is so far above trend from what was happening before the pandemic, even if it went back down to trend, that would feel like a huge slowdown, even though that would be still a rise from what we were in 2019. We spent so much money in this country for like two or three years. So Lizan Saunders tweeted exactly that. Take out 2021. 2020 sales went to zero, 21. All right, take that out. Retail sales were up 7.2% to 2022. It's the strongest nominal annual gains since 2004. Now, there are people that are

listening that I'm probably like, you idiot, it's all inflation. All right, fair. But still, sales were okay. So, what were they down last month? Was it 1%? Something like that? But even if you look at real retail sales, which is inflation adjusted, it's starting to roll over because of inflation, but it's still well, well above trend. It's coming down, inflation is eating into that, but it's much higher than where it was beforehand. That's the thing. Just a normalization of that, for some people, it's going to look like a crash, even if it's just getting back on to what we were before. A lot of car stuff going on. What's going on with this car stuff? Here's the thing. So a lot of people are saying people who are

buying cars now are underwater and their loans are so high and their payments are so I can see how the payments being high would be a thing. But how many people do you know that are willing to give up their car? What do you mean give up their car? Isn't everyone who drives a car off the lot underwater on their car loan? Doesn't your car depreciate by 20% the minute you drive it off a lot? Okay. People keep saying there's so many people underwater on their car. Oh, as if they're not going to make the payments. Yes. Yeah, I understand. No one holds a car loan. in the hopes that it's going to rise in value, like a house. So maybe that's like a narrative crime.

A car payment is like the last thing you're going to give up. If you have kids and you need to get them somewhere, aren't you going to stop paying your gym membership and Netflix and maybe your mortgage before you stop paying your car payment? I feel like car payment is like last in the line of things you give up on. Yeah, it's a narrative crime. I agree with you. Before we get to this car stuff.

So last week, Bullard and Summers, I think on the same day, said the possibility of a soft landing had improved. And then J.P. Morgan, according to the firm's trading model. Seven of nine asset classes now show less than a 50% chance of a recession. How would asset classes show a chance of recession? What was it in here? It was credit spreads, stocks, things like that. I think maybe asset classes is maybe the wrong word, although I can't remember.

Cannot remember, the guy to follow on all this car stuff is at guide dealership. But he does say subprime consumers are not paying their car loans, Ben, more than ever before. 7.11% of subprime loans were severely delinquent in December, the highs in the data series going back to 2006. So he cited this thing, Cox Auto, they do a weekly market summary. Loans delinquent by more than 60 days increased by 5.3% and were up 26.7% from a year ago. Of all loans, 1.84% were severely delinquent. I mean, that doesn't sound that bad, does it? That's what I was going to say, how much of subprime is the total? And he also says, also, this is important, delinquencies have not let the defaults yet,

although I guess you would probably expect delinquencies to leave the defaults at a certain point. He also says, average monthly payment on a new car hits $777 in December, an all-time record. That's nuts. That's very high. I partially blame the environment for cars being at lack of supply, but I also partially blame people spending too much money on SUVs and trucks. I'm going to keep saying it until people listen. to me. Every time I go into a parking lot, you can't even fit two cars in a parking lot anymore

going different directions because the trucks are so big. I'm going to harp on this as much as you talk about your mudroom. I almost got to an accident the other day. Funny you from you mentioned in a parking lot. Yes. It's hard to get through them now. I hesitate to say this out loud, but I have a pristine track record behind the wheel, not to brag. Knock on wood. I got it to one accident in 2002. Not my fault, in my opinion. My worst one was I used to drive a Nissan Ultima. And I'm driving down the road and it's kind of icy out. And the guy next to me, shimmies a little bit of his car and he sideswipes me. I'm just driving straight. Side swipes me. So I pull over. And the guy took off, just took off. Turned to the left light and just ran. Thanks, man. My first car was a gold

Bewick Regal, probably like 1997. Not the coolest car in the world, but did the trick. A lot of memories in there. Anyway, I was in a parking lot the other day. And I was at the mall. And I was with Logan. we were going to dick sporting goods. And I did something very dumb. I don't know why I did this. Oh, I know I did this. I put on my right signal to pull this way into it. But I looked, as soon as I started turning the wheel a little bit,

I could tell the space was too tight. So I instead saw a spot out of the left corner of my eye, and I wanted to go this way, and there was a car incoming. But it was 6.45 at night, the guy didn't have his lights on. So I feel like technically, even though I would have hit him directly. correctly head on, that would have been his fault. Who doesn't have their lights on in a parking lot? Hello? Duncan wants to know that if you'd be a gregal is a grandpa car. Pretty sure it is. Grandpa car. Yeah, totally. Definitely. Absolutely. Absolutely. Google it. So we talked last week about the

Tesla price cuts and the Wall Street Journal had a story saying that it's messing with the market. They lowered their prices enough so some of their models could hit that $7,500 tax credit. I think above a certain price point, you can't get the tax credit anymore. So they not only lower their prices, but people could also, if you are under certain income, level, you qualify for a $7,500 tax credit, which is great. And they're saying all these other car companies that have been jacking up their prices are now thinking, do we have to lower them too? I think this is a great thing. The Bank of America analyst was talking about Tesla saying they don't know if this is a good thing that Tesla's doing this because they're trying

to stoke demand or it's a bad thing saying that their prices are too high. But isn't this kind of thing where one company does the other ones have to do it a little bit? I hope so. And hopefully we get some other price cuts coming for the cars? The prices are ludicrous. So I told you I've been texting with my car broker, just putting out feelers, seeing what the market is like. It is absurd. Still feels like now is not the time to buy a car.

I still feel like if you can, you wait. Can't do it. I just can't do it. I think we've got to wait for more supply. I think more supply still has to come online. Yeah, I can't do it. It doesn't make sense. Oh, how about this?

Here's some good news from Stephen Ratner chart showing that the average deposit held by the bottom half American households more than tripled. from 2019 to 2022. Does that mean we can finally get rid of that stupid stat that seven out of ten Americans can't come up with $400 for an emergency, whatever it is? No, now the status of seven out of ten can come up with an inflation adjusted $400 for an emergency.

All right. Another good piece. This is from Bloomberg. More than five million businesses were created in the U.S. last year. I signed that entrepreneurship boom spawned by the pandemic, maybe long-lasting. New business applications rose by 44% from 2019 to 2022. Sharpest increases was in southern states.

That's the good news. The bad news is three million of them were on the blockchain. Doesn't this fly in the face of no one wants to work anymore? Quiet quitting. Everyone is lazy. We're creating new businesses at a record pace. I kind of feel like a lot of that was probably bullshit.

14,000 businesses were created every day in 2022. Well, but there's a big difference between creating a job versus lazy employees. Or I should say bad employees. Employees that don't want to work. Those are two very different people. I'm sorry. Here we go. Grog back in the Stone Age was a lazy worker.

Grog? Isn't that the name of a Stone Age man? I'm saying throughout history, there's always been lazy workers. There's never been a time when everyone was all of a sudden like, I love my job. I'm going to do the best I can. There's always been lazy workers. It's not like that would be a new thing. Maybe we just know it now because people post their jobs on social media.

Exactly. All right, let's talk about layoffs. They're coming. This is a big week for layoffs. Paul Kodroski tweeted not a fan of the guy who owns this place. Talking about Elon, but it is worth pointing out. that despite having lost 80% of its employees and being down to 550 or so engineers,

it is still mostly running. If you think bio firms like Thomas Bravo aren't noticing, you don't know your capitalism. Then Alex Cantowitz tweeted not to him directly, but the meme that Elon cuts 75% of Twitter and the service works just fine is a bit off. Many of those cuts were in the sales org and revenue is down 40%.

That's not working fine. Now, I feel like the revenue being down is more of an indictment on people just boycotting Elon than the service being shit. Maybe it's a combination of both, but the service is definitely glitchy now. But for the most part, it does work. I mean, it works. Yes, people keep saying that they're getting shadow banned and not seeing certain accounts.

I guess I haven't noticed any difference. I've noticed some things here. We don't have to complain about Twitter. Alex Morris tweeted a chart. Yes. You complain about Twitter on Twitter. Exactly. That's the platform for cleaning out Twitter.

Amazon, Google, Microsoft, and Mattisote. So tech labs are coming in hot and heavy. 2016 cumulative head count, 545,000, 2021, 2021 cumulative head count, 2 million. I think one of the things that was so special about these tech companies early on was just the insane amount of leverage they had in the system in terms of revenue per employee, income per employee, all that sort of stuff. And I don't know what happened, but it turned out that, I guess, growth and headcount growth became in vogue.

This is from the Wall Street Journal. This is why I think tech layoffs tell us absolutely nothing about the economy right now. I don't think you can learn anything from these tech layoffs. from fiscal year end in 2019, September 2019 to September 2020, Apple's workforce grew about 20%, 164,000 people they added. Over the same period, employee counted Amazon doubled, Microsoft's roll is 53%, Google's rose 57%, and Facebook rose 94%. So if you're seeing these numbers and thinking they're big,

just think about how many employees were added in that three-year period. They over did it. And I don't know if that was because of competition with one another, or they thought things were going to be rosy forever and they're making so much money. The reason that they are letting so many people go is because they overhired, plain and simple. This has nothing to do with the economy. So Google laid off 6.4% of their employees. That's 12,000 people.

Guess what? I'm not happy they're doing, but that's a professional layoff. 6.4%. That's true. It wasn't a 10%. It says Google Brain, this is from the information. The AI lab that has helped Google's core business, use machine learning software to personalize products from proven ad targeting was relatively uninfected.

that unit is now urgently trying to work with product groups and how to develop new services powered by human machine learning, blah, blah, blah, in response to open AI, chat, GBT, and micros. Okay, you ever see something that is so obvious that you sort of wonder how you didn't think of it yourself? Here's where I'm going with this. Somebody tweeted, I can't remember who, that the Google box, the Gmail inbox is just a disaster.

Or something along the signs. And I realized, I was like, hey, yeah, it is a disaster. But it was a weird disconnect. Do you know what I'm going with this? You wish you would have thought that you would have had that idea. Yes, like it's such an obvious thing to say, but you don't really think it out loud in your subconscious until you see it on screen. All right, anyway, the Google inbox sucks. I search for stuff all the time.

I can't find anything ever. The search is tough. It's horrible. I don't mind the inbox itself, but you're right, the search, if you need to find something. No, I'm talking about the inbox. I can't find anything. I'm looking for old conversations. I just, it's one of 475.

The targeting on the word, it's terrible. What is a good one for search is Slack. Slack is pretty good about finding little conversations. I find everything in two seconds. With Slack, you could search, who is it coming from? Which chat? Is it a file? Slack is phenomenal.

Google New York City employees who arrived at the office earlier this morning, stood in a line to test their badges. If light turned red, it meant you had been laid off. If green, you were safe, that sounds pretty cold. By the way, the stock was up 5.4% of the day. All these stocks, these stocks do you announce layoffs, and the stocks go nuts. Sounds like the beginning of season two of Squid Game. You get the red thing, you go down to the subway.

The guy hands you the card. You're on Squid Game Cases. season two. When is Squat 2 coming out? I don't care. I don't know. I think about it. Really? But anyway, somebody Google commented, I know this seems cold, but we have 30,000 managers. It's too big, right? 30,000 managers. Something probably slipped through the crack. They didn't do this on purpose. I think they did, but I'm saying, now that there's not a more humane way to do this, but yeah, it was not an accident. Microsoft to ask thousands of jobs, was it 5% of their workforce? Yeah, let's try to Microsoft employees. It's just, it's crazy. It's huge. They all. They

all over hired. So Microsoft is taking a $1.2 billion impairment charge and soon to be announced earnings related severance costs. Think about how big that is. One point two billion in severance costs. There was an article about why Apple hasn't done it yet. Here's an interesting stat. Apple has 65,000 retail employees. So they need those people. That makes it 40% of the company's workforce. Apple hasn't done a big round of layout since 1997. That is the kind of place where I don't go to the mall very often. I don't frequent them all as much as you do. The old store it's packed. No, I never go to the mall. Never go to the mall. You call me like once every six months. Hey, I'm looking for some new clothes. What should I get? Once every 12 months. Do I always come

through for you with the new fashion trends? You do, except every time you tell me to buy something, it's like a $180 shirt. I don't know what places you're shopping at. All right, Spotify. What did they announce? How many was it? Oh, 6% of its workforce. Is 6% the new 10%? I feel like 6% is legit. As long as it's an even number, like you said, at 6.4 for Google or whatever, if it's a flat number, there's more coming. Bob Elliott tweeted, tech layoffs are getting a lot of press, but these layoffs are small, being quickly absorbed into a tight labor market. Wayfarer, cutting 10% of its staff, 7, 150 people, I'm sorry, that won't be the last cut.

You see these headlines, and this is why you say, see, we're already in a recession. All these people are getting laid off. In the past, you never saw layoff announcements, like you do on social media now. If these things happen, you didn't really hear about that much. That's true. The stock had a huge pop on that. I can't remember what the number is. I think Mark Andreessen wrote this one time. It's something like every single year, five to six million jobs are lost and five to six million jobs are created. That's just like the dynamism of the U.S. economy. That's whether we're a recession or we're growing. That kind of thing happens all the time anyway. We've said this a million times. All the lives are happening at the most high-profile

companies in the country, so maybe it feels worse than it is. Or maybe not. Someone from Goldman Sachs just sent me this message. So here's a message. I work in institutional sales at Goldman Sachs. Entire floor laid off today. Partner held a meeting saying that the quote, music was about to stop. Please keep anonymous. Maybe they should have cut off the message at please keep anonymous instead of posting it on Twitter. Is there a read-through to the economy about investment banking? Goldman did terrible with their push into the consumer banking. But isn't part of it also? There's been no IPOs. It was an awful flop. There was no underwriting activity last year. So does this say more about the global economy? Is the music about to

stop because Goldman is cutting back? I don't necessarily think so. This is also the thing, if you worked in the loan department at a bank and you're doing zero refinancing now, you were going bananas with refinancing for three or four years straight and half of your department gets laid off, you're probably thinking there's a depression coming. So a lot of this is targeted at specific industries, unfortunately. So if you're in one of those and you were unlucky, enough to be there. It doesn't matter what the economy is doing to you. It feels like a recession. And it is because you lost your job. I have a take on all of those people getting cut, which we'll revisit in a second when we get to real estate. But before we do, so a tax percentage

of S&P 500 market cap was as high as 30% at the peak and it's now down to 21. That's a gigantic drop. That is gigantic. In that quick of time, yes. Wow. Slumdog billionaire. It's not bad. What's that? The chart's called slumdog billionaire. Not bad. Ram tweeted a chart from Indeed via the journal, job postings on Indeed.com changed from a year earlier. How about this? I remember when I was looking for jobs back in like the mid-2000s. And even then, the career builder or whatever they were back, I can't remember what they're called, the monster.com, the job sites, they were all worthless back then. There's no way that these things can be helpful for anyone. If you're able to send out your resume from all over

the country, there's no way that these sites are helpful anymore. For finding a job? Wrong. LinkedIn is like one of the biggest... I'm saying LinkedIn, that's different. But for some of these other places, just going to whatever, I don't know what the website is people use these days to find a job. There's no way that's helpful to people. Where do you think people find jobs? LinkedIn. I'm saying like these are the ones where you just post your resume, getting through because now that people can work remotely, there's got to be 10 times more resumes coming

to these people. I'm just saying it's got to be very hard to get yours for someone to actually look at. Well, we don't need to talk about what my resume looked like. You know what I had in my resume? I had Cabanaboy in my resume. I had a waiter. And you wrote about the Cavs versus the magic. You changed your mind. Proficient in, I don't even think I had proficient than anything. I don't think I had that my resume. My resume was a disaster. All right, let's talk about crypto for a second. So, Bitcoin is now at 23,000, by the way. It's Tuesday, 11.15 I.m. Bitcoin was 20,000 when FTX news came out. Isn't that kind of wild? What were the lows? 15-ish. The low was 15-5.

I still can't believe it didn't go below there. Same. Does that show that the people who are the biggest holders are literally never going to sell? Are the whales that control the most of the Bitcoin? Can they control the price that much? No, no, no. It's the opposite. It's the opposite.

You take them out of the equation. Because they're not setting prices. Yeah, all that happens at the float shrinks. But it would take one of them to sell towards the bottom to really see this thing plunge. Yeah, yeah. I think so. So it really is the marginal buyer and seller. Guess what?

More buyers and sellers? I guess so. the longer Bitcoin goes without dying, that's the bull case for me. That's like the one remaining bull case is this thing will not die despite all the bad stuff that happens in crypto. All right. There was an article on ETF.com about untangling the web that is DCG, which owns Genesis, which I believe filed for bankruptcy. I'm so confused. There's Genesis and GBTC and it's all very confusing. DCG is a parent company. DCG owns CoinDesk. It owns Genesis, and it owns Grayscale and some mining companies. I don't know if it's the biggest

company in crypto, but it certainly is an extremely important player. All right, so the deal is that Genesis owes its largest 50 creditors, $3.5 billion. Genesis got a hole blown it when Terra Luna blew up and then Three House Capital blew up and they were lending money to Three House Capital and did not get paid back. So DCG owns 67 million shares of GBTC, which is around the 10th of all shares outstanding. At current market prices, those are worth around It's $800 million, thrown another $100 million worth of shares for the Ethereum Trust, E-T-H-A. So they're saying, like, why not just sell to, like, make them whole?

Could they sell at NAV if they wanted? Does it work like that or not? In like a private transaction? I don't know. Why would anybody buy it at a $80? That's true. When you could buy it at a 40% discount. So ETF.com says, one, is that regulations prevent it from selling more than 1% of

GBT's shares outstanding per quarter. So at that pace, even if they wanted to unwind, it would take two. and a half years. Okay. Secondly, if they were to do that, the discounts would widen it even further. So they're not going to dump this on to the market. This is not going to. And even less like the option is for DCG to order Grace County to liquidate, but with $13.3 billion in AUM and a 2% management fee, that's $266 million in annual revenue. So that's not happening either. But then I saw a tweet from this person at North Rock LP. Genesis refiling reveals that $31 million of GBT was already sold by Genesis in the last few months. This actually might explain why the

spreads widen so aggressively and clears a large overhang from the future. So GBTC is actually outperforming Bitcoin by a decent amount this year. The discount was almost negative 50%. Now it's like negative 40. So I pulled this as of last Friday. GBT was up 47% on the year while Bitcoin was up 27%. But it's obviously underperformed for a long time before this because Bitcoin is up 100% over the last five years, what do you think GBT's performance is? As Bitcoin has doubled. Over the last five years, that's it. Five years, Bitcoin is up 100%. I guess that's what happens when you lose 70 plus percent. I bet if you zoom back six years, zoom out, then, zoom out. Well, five years is about the last peak almost, so that's why. Okay, got it. I don't know,

what? 30%. It's down 34%. Whoa. Can you imagine holding that five years and you're underperforming about 130% of the asset you're supposed to track because there's a discount? That's rough. So also involved in this is Gemini, who their earned product was funneled through Genesis. We've been through this. Gemini loans to Genesis. Genesis loans to people that apparently didn't pay them back. Now people that had money in Gemini. This is why I'm so confused, Gemini, Genesis, GBTC, D.C. There's a lot.

All right. So Gemini earned customers are owed $900 million. That's a lot of money. And that's just awful. $900 million on the platform that stuck. The person that I've been following for this is AP. p underscore abacus on Twitter. So update, per Genesis bankruptcy filing, Gemini has $600 million available pledged via

GBTC shares value to return to Gemini earned customers. 31 million shares have already been delivered and another 31 million have been pledged. So it looks like there's a 300 or some million dollar difference. So if that's the case, that's actually decent news. We've got a bunch of questions for people who say, I have my crypto or whatever stuck on platform X, name five different platforms. Can I write that off for my tax purposes? I don't think I'm ever going to get it back.

Oh, I don't know. I don't think so. I have no idea. Let's say you had 10 grand in Bitcoin on FTX. That money is gone. Do you write that off as a loss in your taxes? I don't know. As your accountant.

There was talk that DCG would sell CoinDesk. They were looking to get $200 million. This guy, again, AP underscore Advocas, says initial conversations for CoinDus range from $15 to $25 million. Who knows if that's true. or not. How much money could be making right now if there's no crypto companies that are able to advertise? I don't know. I think they're the biggest. 200 million for a crypto media company right now? You kidding me? I'm not buying it. I hope no one's buying it for that. All right. So,

let's talk about real estate. There were a lot of layoffs in the mortgage departments of these banks. When I refinanced in 2021, I guess, it took forever. Why? You're muted. This is what happens to you. Tap your mic. You don't need to move your mic. Now, I muted by Mike because I've been sick for a week and I'm clearing my throat and I don't want people to hear me clear in my throat. Oh, that was a deliberate mute? I did it on purpose. Oh, very nice.

But I'm saying, us complaining about our mortgage refinancing in 2021 was to 2023 as you complaining about your mudroom. Well, I'm not complaining. You didn't complain. Just stating the facts. I might have complained. But anyway, so what happens if mortgage rates continue to pull back, which they have, activity shoots up, which it has?

there's not enough people to service these mortgages, then what? Is it deja vu all over again? But it's fallen so far, the activity. I think even if you see a big increase in activity, it's still going to be way below levels that we had in the past. But you know how like all these tech companies overhired, what if the mortgage companies, what if they overfired? True.

People are just going to have to wait again for their paperwork probably. Cause another logjam. All right. So I saw this tweet this morning, Goldman calling your housing bottom already. We believe that the aggregate drag on GDP growth from the housing sector peaked in Q422. The negative impulse of home sales is diminishing and leading indicators of home sales have already turned to hire. So the 30 year was almost at 6%.

Maybe that explains the housing stocks going bananas. Can you imagine thinking that this is it, this is the housing crash I've been waiting for, and then it doesn't really happen. We get like a 5 or 10% pullback. It's way too early to say that it's still over. But I think we've been talking about this. It's all based on right. So Bill McBride tweeted that it got down to 6% yesterday.

This is interesting from MarketWatch. They had a story about home builders who, instead of lowering prices, because home builders don't want to lower prices right now, because here's the problem. If you have 30 people under contract for a home and then you say we're lowering prices by $30,000 for a home, all those people under contract are going to go, screw you, you can keep my deposit. I'm going to get a new one at a lower price point. And so what they're doing instead is instead of lowering prices, they're buying down

the mortgage rate. So they said in California, Pacific Point Communities is offering mortgage rates. rates as low as 2.75%. Pulte homes in Texas is offering them for 4.25%. And K, how do you say that? Havannian is offering at 4.9%. I don't understand. Here's what's happening. The mortgages, here, it's in this article. It says put simply, some builders are eating the difference between prevailing mortgage rates and what the consumer will accept just to get inventory moving and empty homes off their back. You know how you can pay down for a mortgage rate at the bank? You can pay points. The home builders are paying those to the banks, saying we're going to pay down a rate from

6% to 4.5. And so instead of lowering prices by that much, we're going to pay for the mortgage to come down that much. The home builders can't do huge price cuts. Instead of cutting the prices, they're cutting the mortgage rates. And they're paying for the mortgage rate points to come down. Because if you put a bigger down payment down, you could pay down your mortgage points if you want it to pay down to a lower rate. That's what the builders are doing. That can't last forever, but after they get the backlog of houses in, that could potentially for a while put something of a floor under housing prices if they're not willing to lower prices. chart that shows 96% of outstanding mortgages have interest rates below PMS. We're looking at

the distribution of outstanding 30 mortgages and just eyeball. It looks like almost all of them are well below five. What's PMS? Prime. I got nothing. Mortgage, market, salary. Sure. I don't know. I think that's the thing with the home builders. Because rates change so quickly, that's why it's easier for them to pay down rates as opposed to cutting prices, which is a weird dynamic. Look at this chart of NBA U.S. Mortgage Index, weekly percent change. So what? You saw a huge spike in applications? Highest spike since pandemic. So rates came back down. So rates came back down. And people decided to get back in. All right. So what's the situation with Australia? Apparently, we've got a big Aussie audience. Thank you for listening.

So they say 30-year fixed rate mortgage isn't an option there. At best, you can lock in for five years, but generally pretty expensive to do. So at the best, people would lock in rates for one to three years. Most people are floating or rolling off of their fixed rate. That's tough. One to three years. That's a lot of change. So if you bought two or three years ago and rates were near zero, you may have a two and a half percent variable mortgage. If rates keep going, that could easily get up to five or six percent in a few years and your mortgage repayment suddenly shoot up. Could force some people to sell. That's painful. I'm glad we do not to do that. Not good. Ready move on to some quarter stuff? Let's do it. Just a few plugs for quarter. You could sign up

for a weekly recap, I obviously don't expect anybody or most 99% of you to ever listen to a conference call. But if you are interested in staying on top of the stuff and you want to just see like a weekly recap, they provide that so we can look at them to show notes. All right, Sam Rowe tweeted, with 11% of S&P 500 companies having reported, 57% are beating earnings, which might sound good, but it's actually well below the 70% average and 61% are beating on revenues, which is lower than the 69% average. That's so funny that. 70% of the time they beat estimates, showing that the estimates are just a crock, basically. So that's not good.

Listen, it's only 11%. So definitely early. Who do we have coming up this week? Do we have Microsoft? I think most of the tech giants are next week. All right, let's start with Netflix. Alex Morris has a wonderful substack showing we're going through some charts. I'll talk through it.

Global page streaming subs had plateaued for, I don't know, five quarters and accelerated. So they added $7 million. I think they were expected to add four. So that was a great beat. The Netflix cycle over the last four years has been, they're the top dog. There's way too much competition, and now they're the top dog again. That happened very quickly. Their annual revenues are now up to $31 billion.

Guess how big that is? We've said a million times that Netflix is a king. If you stacked $1 bills, it would go to the moon. Is they going to tell me? No, we'll talk about HBO later. Is that the most worthless stat you've ever heard? Apple makes so much money that if you stack them in $1 bills,

it would go around the earth 12 times. I used that line in my book. Back then... It's a long time ago. It was legit. HBO are the Eagles. Maybe this is too disparaging to Netflix. I want to say Netflix is the Giants.

What I'm trying to say is there's a huge gap in just the quality. By the way, let's just say, Saturday night sucked, but proud of my boys. We outperformed with a really lousy roster. I was shocked the degree to which their offensive line dominated,

Not necessarily on the defensive side, I expected to get beat up a little bit, but it was just not a fair fight. You didn't expect to be there anyways. You were playing with house money. It was all good. I wish it wasn't the Eagles because I hate the Eagles, man, but such as life. All right, so $31.6 billion. That is equal to the combined run rate of Disney plus Warner Brothers and Paramount. Pretty good.

This is from the earnings report. They said, as it's become clear that streaming is the future of entertainment, our competitors, including media companies and tech players, are investing billions of dollars to scale their new services, but it's hard to build a larger profitable streaming business. Our best estimate is that all of these competitors are losing money on streaming with aggregate annual direct operating losses this year alone that can be well in excess of $10 billion, compared with our $5 to $6 billion of annual operating profit.

For incumbent entertainment companies, this high-level investment is understandable, given the accelerating decline of linear TV, which currently generates the bulk of their profit. Because of all the debt these companies have taken on and losing some money, that's why there has to be consolidation. Peacock and Paramount Plus and Hulu, eventually some of these have to come together. Oh, I found out that I pay for Peacock, which was news to me. I saw my wife watching

something. I was like, what is this? She's a peacock. We have peacock. Phil Huber told me that the entire WWE catalog is on Peacock. So maybe I'll watch the latter match from Sean Michaels and Razor Ramon. I haven't seen that one in a while. Ninety-94, Ben would be very excited about that. 2004. I think it was literally not so much. Last thing. This is from Ben Thompson. He's talking about the debt. Is this Netflix that's $14 million in debt? I think that's what it is. Warner Brothers Discovery, meanwhile, has $50 billion in debt. Disney has $45 billion in debt. Paramounts is $15.6 billion. Comcast, the owner of P-PAC, has $90 billion in debt. None of them, in contrast to Netflix, are making money on streaming. So how about that?

When do we see consolidation? Too early? Netflix is in the driver's seat again. Yeah, maybe in the recession. I don't know if we ever have one. We heard from the CEO Verizon this morning. It was on CNBC. I just saw a tweet goodbye. Customers are paying. Delinquencies are low. consumers waited longer during the holiday season, but they came just days before Christmas and did a deal. I feel like that's where you see delinquencies. Cell phones? Yeah. Isn't it a phone kind of like you have to have one now, though? Yeah, maybe. Well, actually, how about this? Absolutely. That's the point, Ben. Everybody has a cell phone. You're going to be late to pay if you're having financial troubles. It doesn't mean that you're going to default and you're going to

stop paying, but you would see delinquencies in cell phones because everyone has one, even the lowest than consumer. I don't mean that in an insensitive way, but just lowest income. Even people who have Android phones and not iPhones. Schwab, I don't think about Schwab. It's kind of boring. I put ally financial in here. Why? I think they're the biggest digital bank in the country. I didn't realize how big they were. They have this chart on the used vehicle outlook because they're a huge auto lender. They're expecting values to be down 13% in 2023. For used car prices. which would be a 30% decline since the 20-21 peak. That makes sense.

It's pretty healthy. If you look at their actual retail auto net charge offs on delinquencies, they're certainly on the rise, but these are not big numbers just yet. You're more worried about the car market than I am. Fair? I'm just thinking, I don't know if I know enough to have an opinion. I'm just going to be following this guy and see what he says. Okay.

That's what this is for. You put an average U.S. commercial credit card interest rate, it shot up to like 19% and it shot up immediately. How do you feel about this? offsetting. So the Wall Street Journal today had an article about how people are finally moving out of their crappy savings accounts. The average savings account according to FDIC for banks is 0.33%, which the fact that you can raise credit cards this high, this fast, and keep your savings rate at 30 basis points, it's pretty gross. The Fed funds rate is 4.5% is ridiculous. If you're going to

raise borrowing rates, you should have to raise savings rates as well. There should be some sort of linkage there. I'm surprised that Elizabeth Warren isn't fighting out about this. Maybe she has that I don't know about it. With all the nonsensical arguments, who's that guy that goes after corporations was talking about? It's a really bad tweet this week, a really bad take. No, not on Twitter. All right, so this guy Robert Reich tweeted,

egg prices are up 60%. That's absurd. People are playing upwards of $6 and $7 for a dozen eggs. Why? Corporate greed. The largest egg producer, Cal Main, is raking in record. Okay, stop it. Stop it right now.

Everybody knows this is nonsensical. We know it's not corporate greed. how many hens have died? It's bird fluids. So just stop it. Anyway, this guy and now those who make silly arguments about corporations go off to the banks about this. This is a worthy hill to fight on. Here, here. I've been on this one for years. No one's listening to me. We didn't spend a lot of time here, but this is a great example, a great example of gradual improvements going on noticed, which is a blog post that I've written about that I believe I stole from Bill Gates. Good news is not in the headlines. It's not a one-day thing. It's a process.

that's not an event. So Derek Thompson tweeted, new report, U.S. cancer mortality rate fell by one-third in the past three decades. Mortality declines are accelerating for lung cancer. Oh, that's not good. Slowing for breast cancer, stabilizing for prostate cancer. But again, U.S. cancer mortality rates fell by one-third in the past three decades. This should be the front of every newspaper and every media outlet for weeks. Probably won't see a mention of it because who's clicking on this? Your weekly dose of optimism from us. That's the way it works. Can I tell you while we're on just tangents? Quick story. The listeners can decide if this makes me look like a good person or a jerky person or somewhere in between.

I'll be the judge of that. Fair. I did give you a heads up about this. But here's a story. So I went to dinner with Phil, after TCAF. Phil, Doug, and a friend of mine. And we went to a steakhouse, like a French steakhouse. And here's my line on steak. What's your favorite steak? Well, I've said this a million times. I love steak. And I've never had a bad steak in my entire life. really, in order to give like a favorite, I really would love to do a taste test, which will never, ever, ever happen because you're not going to put all these different steaks on a plate next to each other. So I have somethings that are like better than others. There's a lot of good steaks. Yeah, I've never had a bad steak. It's like pizza. I've had bad steak. Well, I've had bad

pizza. Had Domino's the other week, terrible. I've had bad pizza. I've never had bad steak. So we got a tomahawk ribeye. That's expensive. It's not a cheap piece of meat. And it was objectively bad. We got it medium rare, and it wasn't even necessarily overcooked. It was really tough and really fatty and just not good. It wasn't going to say anything, but I said to the guys, I was like, not to be a bummer. This isn't a good steak. It is not good. Again, I'm not like a food snap.

I don't have like a fine palate. I like steak. This stunk. We were on an upstairs level. So I was waiting on the steps for the waiter to just tell them. And I wasn't even necessarily asking for anything. Listen, would have been nice if you took it off the check? Yeah, it would have been nice.

But I just wanted to let them know, hey, this was just, I'm doing it for the people. I want to make sure the people behind me get the bad steak. That's not sure. kidding. But so I'm waiting on the steps and the waiter's not coming down. So one of the assistant manager comes over to me and says, is everything okay, sir? And I said, I'm just waiting for the waiter. Waiter didn't come down. So I said, you know what? Let me just talk to you while I have you. We got a timelock whereby and it was not good. It wasn't great. And he was like, oh, I'm so sorry. I'll take that right off the bill. I was like, great, thank you. Another manager came over to the

table. Now I go back to the table and I didn't tell them I said anything. I didn't want to do it to the table. I would never send food back. I've never sent food back in my life. You ever thought? I'm just thinking back to like four weeks ago and he said, I never say anything to the manager. And now that's two instances in a month that you've done this. That's why I'm bringing this up. I'm pointing out there. The last time I was in the right, 100% of the right, I ordered Casamigos to give Class Aizu. Stop.

That's inappropriate. Although in that sense, I shouldn't have even paid for it. I should say, I don't want to pay for this. I did pay for it. So the manager comes over to the table. Now, mind you, I have not told the guys anything. I'm sitting next to Phil Huber. Phil is from Chicago.

He's Midwest nice. Doug is not that nice. I love Doug, but he's not afraid to say something. So the magic comes over, is everything okay? Phil's like, oh, everything's great. Phil's about it's like, oh, best meal I've ever had. Amazing. Thank you so much.

I'm like, shut up. She goes, what about the steak? And immediately, Doug flip switched. Doug knew that I went and said something. So Doug had my back. He's like, you know what? You got to be honest with you. The steak was fatty.

It wasn't good. It was overcooked. You know what they did for us? And it gave us a free dessert. Okay. Okay. I don't know. What do you want them to?

I don't know. They should have given you a gift. Not okay. So, yeah, listen, I'm not a send-it-backer. I won't pay for this. Is that also a you get a worse tip for this? I didn't do that, because it's not a waiter. But here's the thing. That's true. It's the kitchen. I should have mentioned I was in the hospitality business. I was waiting for four years. What do I do in that scenario? That comes right off the bill.

That's fair. I'm not looking to abuse the system. Here, have a piece. Stunk. All right, sorry, that story was way too long, and probably not even that good. You just wanted to tell people that you really are a Karen and you go to complain to the management. That's twice now in a month. Not at a month. We were in Houston. I can't go anywhere with you anymore. Okay, so streaming took over a thousand basis points of share over the past year.

Of what, TV? From Alex Morris via Nielsen. So it looks like it's slowing down. A thousand basis points or 10%. Wow. Well, whatever. You know what I mean. Same thing.

That's crazy. It's one from 28% to 38%. This is like the ETF mutual fund thing. It's inevitable. True. How about this? This is like the one outlier, outperformer. I don't think we're making a big enough deal about the fact that a sequel for Avatar

made $2 billion, a non-marvel. Somebody tweet that Jim Cameron, do I call him James or Jim? What do we call him? Jim. He has three of the six highest grossing movies of all time, and the only director with three films across $2 billion. That's wild. And, oh, I bought Disney stock.

You're a Disney holder, okay. I did. I bought Disney last week. Welcome to the club. Disney owns 21st Century Fox, which produced Avatar. That's true. It's going to be on there. The first one's on there.

My son keeps asking, when is number two going to be on Disney Plus? He loved the first one. Great. All right. Recommendations. What do you got? 1923. They had the first four episodes up in Paramount Plus. I think it starts it up again in a couple of weeks. I don't know if they're waiting for the Super Bowl to be over or what, but the first episode, I liked 1899. It didn't love it. It was interesting. 1923, the first episode, I'm like, oh, is this going to be kind of like 1899. Is that with Harry Ford? Harrison Ford is in it. Helen Mirren. It got better every episode, and I love it. It is so good.

I can't believe how much I like it. It gets way better every episode. What's the story? It's just the Dutton Ranch in 19... It's after World War I, one of the suns is kind of messed up. There's some ties to 1899, we didn't have to watch it. It's very good. But one of the funny things was, they're walking into town in the 1920s, and this is when refrigerators and wash machines first started coming up like you could have them.

The guy is trying to sell them, and he said, hey, if you buy a refrigerator and a washing machine, your life is so much more efficient. And they're like, what are we supposed to do if we get these? They're like, you have a life of leisure. And the one guy goes, no, no, no, no. If we get these, we'll have to work more to pay for them. And so he's like, those luxuries become an excessive. I thought it was a very good.

Then you find yourself having a Tom Hawk red by that tastes like brisket. That's true. I tried Wednesday on Netflix because it's such a big phenomenon. Not for you. Not for me. To me, it falls in the Harry Potter category of, I think it's very creative and there's good performances. Like, the girl plays Wednesday is very good.

I watch two episodes. But it's just not my thing. It's not for me either. I don't think so. And I flew through the chair on Netflix. It's a six-episode show. I think it's from last year, maybe 2021. Sandra O.

and one of the Duplas brothers is the Duplas brother who was on industry who I didn't think he was great in industry but I loved him in this one it's just a show about an English chair

at a college and it's teachers versus students and how students on college campuses act these days it's a half hour one it's when you can turn your brain off on

they for some reason didn't pick it up for a second season which I think is fine because the whole first season to me was just like one long movie and I enjoyed it

not great but good that's all I got what did I watch this week not much oh the second episode of Last of Us I have to be honest I like the first episode.

So the first episode of The Last of Us, like everybody else, I was all in only because I have such conviction and zero doubt that HBO is just the best of what they do. In terms of quality, there is no number two. It's HBO and everything else. I don't love the first episode, is what I'm saying. Even though I knew the season was going to be great. I loved the second episode. Loved it.

That's a great show. Did you love the second episode? We're even staying five minutes after the show and listening to the director or the creator of the show talk about what they're doing. Oh, I know what was the thing. I should do that. Keep it going. It's good.

You know what sort of came and went? Josh mentioned this, that he liked it. The Will Smith movie on Apple Plus, or Apple TV, or whatever it's called, emancipation. We pulled it up the other day and thought, eh. I haven't heard a thing. Nothing. I think Will Smith kind of just tanked his career. Think so?

Yeah. Could be. Nominees came out for the Oscars. So this is what's on the list for Best Picture. By the way, 10 is too many. All right, all quiet on the Western Front. I started out to not finish it. Avatar, The Banshees of Inchiren, Elvis, everything everywhere, all at once,

the Fableman's Tar, Top Gun, Triangle of Sadness, Women Talking. Come on, this is the year. Don't be so stuffy. Just give it a Top Gun. Just do it. And give T.C. His career achievement, Best Actor. Is he nominated?

I think so. I thought he wasn't. No, he's not. Okay. He should be right. Come on. It's top gun. It's got to be Top Gun.

Send us an email. Annal Spirspot at Gmail.com. Next week, Michael's going to talk about how they got his order on McDonald's. They put pickles on, he did want them. See you next week.