Animal Spirits Podcast - The Healthy Correction (EP.51)

Episode Date: October 17, 2018

The current market correction, the myth of the 401k market floor, the problem with 401k loans, the downfall of Sears, the massive size of the student loan market, what's holding back young homebuyers, value investing in taxi medallions, Amazon wants to know when you're sick, who benefits from HSAs and much more. Find complete shownotes on our blogs... Ben Carlson’s A Wealth of Common Sense Michael Batnick’s The Irrelevant Investor Like us on Facebook And feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation. Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to Animal Spirits, the podcast that takes a completely different look at markets and investing, hosted by Michael Battnick and Ben Carlson, two guys who studied the markets as a passion and invest for all the right reasons. Michael Battenick and Ben Carlson work for Ritt Holt's wealth management. All opinions expressed by Michael and Ben or any podcast guests are solely their own opinions and do not reflect the opinion of Ritt Holt's wealth management. This podcast is for informational purposes only and should not be relied upon for investment decisions. clients of Rithold's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. Ben, we've got a pullback in our hands. We have a pullback.

By my calculations, the S&P is down 6% from the highs, which is just a few weeks ago. Nasdaq's closer to 8%. Actually, international markets are still down from the January highs. They never actually retrace them. Is that a technical term retracement? At emerging markets, what are they doing? I got emerging markets down 23% from the The January highs in IFA, which is a developed foreign markets are down 14% from the January highs. So it's a pullback in U.S. stocks. It's a correction in international stocks. And it's a bare, I'm sorry, international developed and it's a bare market in emerging market stocks. The question is, is this a healthy correction anywhere? It's pretty healthy.

Healthy. It's not getting ugly yet. I've seen a lot of words strewn about like jitters plummeted. They seem to be talking more about individual stocks than anything. Well, I don't know. I think those superlatives are fair because it certainly was a washout. And we're going to start with a tweet from our friends at Beesbook who showed the percentage of technology stocks above the 50-day moving average completely collapsed to 3%. And none of the stocks in XLK are positive in the last month, none of them. So this washout is, took technology stocks lower than they have been in pretty much any

correction of recent times. I did a little look on this, and I think you might have talked about this last week, but I looked at the year-to-date gains in the biggest technology stocks. Facebook's down like 12%. Apple's still up 30%. Netflix is still up 70-plus percent. Amazon's still up 50-plus percent. Microsoft's up 30 percent.

I mean, Google's only up six, but these are just coming from huge gains already that we're seeing some give-back. So it's almost like you can't call this like carnage by any means. I mean, you can. It just depends where you start. I like to say that a pullback only looks healthy in other. people's stocks. Exactly. And there's few people who admit that they don't, I don't know I was going with that. What? I lost it. I lost it. What would few people admit? Anyway, all right. So Andy Thrasher

threw up a really good chart showing more S&P 500 stocks dropped to a 50 day low this week than during the February sell-off, most since the early 2016 decline. So are we still positive for the year? are stocks still doing extraordinarily well over the last nine years? Yes, but so what? Because every single time these hiccups occur, everybody thinks it's the end, myself included. Okay, I'm going to take the other side of that. I'm not a gambling man, but if I was, I would say new highs by the end of the year. All right. Well, I don't know. But this feels like one of those corrections that we've had. I'm going to hold you to that because I know you say you're joking, but you did tell me that off record. Yeah. That doesn't count then in the podcast world. But I think

this feels like one of those, there really was no reason. Like, everyone was always looking for a reason for a correction. And did we really have one again this time? It doesn't feel like it. Well, what was different instead? Well, actually, was the parity funds blamed this time? The risk parity? They are every time after the fact. But, and I guess you could say interest rates are rising, but interest rates have been rising for a long time now. So it's like, was there a magical threshold that was reached? I think investors are always looking for an excuse to, to sell. And they're looking for a reason and usually... Well, let me ask you this. Let me ask you this.

Okay. Maybe it wasn't a technical level on interest rates, but what if it's like grains of sand being stacked on top of the other? And just suddenly you get to a point where they just all crumble. That's, I mean, that's fair. That's quite possible. I mean, that would be the 1987 corollary, but I don't really want to go there, but... It's also similar to like, what is the PE that's too high? Well, I don't know, I'll tell you when we get there type thing.

Right. And there isn't one. So one of the other things that I want to talk about a little later, but I might as well bring it up now. So our friend Jake at economic pick on Twitter said, he tweeted out last week. U.S. equities look pretty darn attractive if earnings come in as expected. He said the forward PEs for the Russell 2000, which is small cap stock, is back to 2012 levels, midcap is back to 2012 levels.

And the Russell 1000 is back to 2015 levels. So it's almost like what was the valuation level that? made stocks way too overvalued for people, but now what if the fundamentals catch up? And maybe that those overvaluations were just forward-looking that fundamentals are going to come in better than me. So I don't know. It's like a circular argument where... Well, let me actually Jake, where he can't respond. Okay. I can't prove this, but maybe somebody can. Isn't it better to buy stocks when multiples are expanding than when they're contracting? In other words, who wants to buy the pullback on valuations? Sure. That makes sense. But I don't

I don't know. It's kind of one of those things like I don't think that you can actually use evaluations to time these things. And I guess if you're trying to use momentum on a value indicator, I don't know if that really works. I feel like you're kind of muddying the waters there. All right. Well, last week I was listening to our show and I took exception with something that I said. Does that count the downloads if you listen to our own show? Well, we both listen. Okay. That's fair. So I was listening and I took exception with something that I said. which was this is a self actually yeah no which was a reminder to take it easy on people maybe that are just talking extemporaneously because it really is hard like a lot of these stuff you know

we just have we have topics that we're going to talk about but I don't necessarily like think or prepare notes for what we're going to say right you with me all right anyway so I said something along the lines of maybe the bi-monthly contributions and to 401ks would help with the relentless bid theory that there is so much money coming to the market just in the way of former case. And that's true. James Seifat and Eric Boutchunas had a ton of great charts this week showing Vanguard's monthly flows in 2008. And every single month was positive, which is pretty incredible. And this is not just at the stock level. And there's another chart showing 2008 flows by fund type, and it was out of active mutual funds and into index mutual funds

and ETFs. And we'll link to this in the show note. But anyway, the point that I'm getting to is yes, if stocks are down 15% people will continue to contribute every two weeks, probably if stocks are down 20, 22%, they'll continue to contribute every two weeks. But there is a level. And I don't know if that's down 28% or down 33%, but there is a level where not everybody, but where panic ensues and people's 401Ks do not become immune to get me the hell out of this market. I agree. There was a lot of people I talked to, not a lot. I'm talking coworkers and such here that told me in the fall of 2008 that they were going to put all their 401k contributions into money market funds until things, the dust settled or whatever. I'm sure they felt good about that.

So I can definitely see how that would happen. And I guess so a lot of what happened for the Vanguard flows was it was just money coming out of active funds into Vanguard. So it wasn't necessarily new money. Is that the deal? I'm not really sure. But obviously Vanguard is in a much different place today than they were in 2008. I know they have around, let's say, I don't know, $2 to $3 trillion in indexed products. Yeah, that sounds about right. And I think if you, If you look at the amount of trading that goes on, I mean, there's, I think the number is, what, $5 trillion or something in retirement, workplace retirement plans? Maybe I'm pulling that number out of head. Well, if you scroll down, if you scroll down to the chart below, you'll see assets

of 401k style of retirement plans are approaching $8 trillion. Okay. All right. So I was a little under. But the amount of new money that goes in every couple weeks is probably just, it can't be that big compared to the amount of trading that gets done in the markets. Oh, drop in the bucket, no doubt. Right. So that's kind of what I'm getting at is, yes, people will still be buying, but I don't know how much it moves the market. So did we just argue against ourselves there? Well, I certainly took exception with what I said. And you agreed. So I took exceptional with you said as well. So, all right, so you put another story in here, and this was about 401K loans. And I guess this is kind of another side of the story that there's a huge amount of people that are taking their money out of their 401ks or taking loans against them. So this is from the Wall Street Journal. Yes. And the story is the $210 billion risk in your 401k. And what they said was 30 to 40% of people leaving jobs elect to cash out their accounts and pay taxes and penalties rather than leave the money or transfer it to another 401k or an IRA, which is a stunningly big number, 30 to 40%. Here's my question. Is this a survey or is this an actual study? All right. Never mind. Let's throw out this garbage.

I mean, it's possible. I honestly, I don't doubt it in the fact that people change jobs so much more often, I guess, especially young people. You'd think when you see the amount of money, it takes a while to build and compound. It's probably easier for people in a lot of ways to just cash out and take the money and do something else with it instead of letting it sit there or rolling it over to an IRA. Imagine you see you leave a job and you're like, oh, I'd be $1,000. Like, I could use that. Right. So they also want to say that one fifth of 401K participants with access to 401K loans take them.

and Deloitte projects that those who default on these loans, which is about 10% of people, those loans are worth $7.3 billion this year and will drain about $48 billion from their account if the money remains and it's stayed earning 6% a year. So, of course, take these numbers with the grain of sand, but these are big numbers and I didn't realize that this is such an issue. Well, yeah, the big thing is that you just miss out of a compounding. So if people take these loans and they're basically paying themselves back, they probably feel like it's all okay, but what they're really missing out is the growth from the markets. And so that's

the big issue there, which makes sense. Obviously, they're taking some liberties with their calculations, but I tend to agree with this. And I feel like one of the, one of the best things about the 401 is that it's kind of hard to get into. And there are some barriers to exit. And it's unfortunate that people are still taking them, even though it's not that easy. And speaking of retail. Nice. Sears went out of business this week, or they filed for bankruptcy. I think they're going to keep some stores open. The one in our mall closed years ago, I think. And it sounds like Warren Buffett actually kind of predicted this. So Eddie Lampert is the hedge fund manager who bought Sears and merged him with Kmart in the early to mid-2000s. So I guess Buffett was

talking to a group of students a couple years ago. I guess it was in 2005-ish. So he said, Eddie's a very smart guy, but putting Kmart and Sears together is a tough hand. Turning around a retailer that has been slipping for a long time would be very difficult. Can you think of an example of a retailer that was successfully turned around. And he pretty much nailed this. I don't know if this is necessarily turned around, but Best Buy stock has certainly been a surprise. And I feel like it did get annihilated maybe five years ago. That would be a stock that I think a lot of people would be surprised to hear has actually done well. And I think over some period over the last few years, it actually outperformed Amazon. I don't know if it is this year. How about this? You know how

there's this thing about like cars being such a disruptive industry, but picking the right automobile maker, why don't I keep saying automobiles, but picking the right car manufacturer would have been a really tough gold thing to bet on. So you were better off shorting horses. Right. I guess maybe you could have said the same thing about Amazon. Like, who knows what Amazon's future is going to do, but maybe short Best Buy? Yeah. You're right. Short the ones that are going to get hurt or a basket of them instead of trying to pick one. Which I guess actually would have been not a terrible trait to short the retailers. Yeah. Well, yeah. And, And so my favorite piece on this was actually written a year ago, and Derek Thompson from the Atlantic, he kind of compared Sears to Amazon and said that a lot of what Amazon is doing now started from Sears.

And they did a lot of it through mail ordering until they kind of built some businesses. We'll put a link to that one in the show notes. It's worth a read. But the interesting part was, so between 1895 and 1905, Sears revenue grew by a factor of 50 from $750,000 to about $38 million in 10 years, which is pretty amazing. So it's, I think it's actually, I mean, some people are giving them a hard time in saying that they should have pivoted or done other stuff. But the fact that they've existed that long, I think is pretty impressive. No, it's a good magazine indicator. Okay.

Not necessarily stock market related, but maybe manager related. Anytime there's a question about, you know, somebody's the next Buffett or the next Steve Jobs or whatever, whatever. Right. It was first, Eddie Lampert got that one on Business Week a few years ago. Bill Ackman got it. Did anyone else get it lately? Yeah, it's like, what's her name? Elizabeth Holmes got it? Ah, yes, she was the next Steve Jobs, actually. So, for Forbes, please, please, I will not,

I will not be on your cover. Right, yes. Right. All right. So student loans, for the second quarter of 2018, outstanding student loans hit $1.53 trillion. Now, I don't want to be just blinded by a huge number, but holy shit, that's a huge number. That's not bad. Let's see. So this is another, I guess this will be an intro into our second survey of the day. It says 57% of young adults said they felt burdened by their student loans, more than one in three said they delayed buying a home because of their debt or knew someone that had done so. So here's my question. I'm not going to discount the fact that student loans are difficult. We've both looked into this. And I think the average is closer to 17 grand, I believe, per person,

which, what's that a decent used car? Maybe a nice new car for some people. It's a lot. It's a a lot of money coming out of school and you're not making a lot of money. But is it really the end of the world? I feel like the really huge ones are kind of outliers and those are the ones they focus on people coming out with six figures in debt. I mean, we've spoken about this an nauseam. And I would say that it is absolutely affecting a ton of people our age and younger. However, is it like the next subprime? No. Right. Yeah. I think that's a good. But will it be a headwind to like household formation and new homes and stuff like that because this one person, I know this is just one person, but there are thousands of people like this. He said, and he has

$70,000 worth of loans. He said student loan debt is literally the only reason I do not own a home. Even with ridiculous property prices in the district, I would be able to swing at least a halfway decent condo in a good location. If I wasn't paying hundreds upon hundreds of dollars in student debt each month, I've been making regular payments for the last four years and my total balance has barely put it done to it. I wonder how much of this is to the fact that real estate has been going up as well. I think maybe it's a combination. I don't think it's just the student loans, but I can see that. I just, I don't know, it's kind of a balance between it's going to give you a better job potentially or give you a better shot at getting a better job, but it's also going

to put you in the hole a little bit at the outset. I don't really know what the answer is. Well, I have good news and bad news. Okay. There's another survey. All right. Those weren't even it. All right. The official number three. The official survey of the week. And I forget who this was done by and who is that. So I apologize, we'll link to one in the show notes, talking about our home price is too high. Only 44% said they think homes are affordable for first-time buyers, yet 62% said rents are too high to be able to save for a future home. Is everything just too expensive? That's pretty tough. You wonder what the location of these people, where they live. I feel like if you're doing the rent versus buy, unless you're in a huge

city, it's probably for most people still going to be much more affordable to rent. That would be my guess because there's so many costs as a homeowner that people don't plan for. But I don't know. Nor do I. Let's move on. All right. So I had this PDF open on my computer for weeks, and I'm glad that Brendan Maloulli gave me the nudge took through it. And we've spoken about this a lot, a lot, probably too much.

But you keep your tabs open on the things you're going to read? Only on this computer. Okay. You don't close them. And when I say this computer, I'm talking about my laptop that stays open and on forever and ever. Okay. Somebody emailed us, something about Vanguard being a Ponzi scheme. That was a hot take, yes.

Right? And something about the passives and the blah, blah, blah. So this article, or this PDF from iShares or BlackRock, said, in U.S. equity markets, an estimated $22 is traded by active stock selectors for every $1 traded by index funds. I'm going to repeat that. $22 is traded by active stocks collectors for every $1 traded by index funds. But who's going to set the prices if everyone indexes? I don't think you get it. Right.

That's a good stat. And there's a good table in here that shows it kind of breaks it out by institutions as well as individuals for how much is actually indexed and we'll include that on the showouts. It's pretty good. No, but hold on. This is important. So percentages of total market cap owned is 4%. ETFs represent 4% of the total market.

And we've spoken about this a lot of them past. that what about institutions that sort of do SMAs but are essentially indexing? So if I'm reading this correctly, institutional indexing is another 8%. Internal indexing is 2%. And mutual fund indexes are 3.5%. So a total of 17.5% of the market is indexed. Right. Which, yeah, that's actually lower than I would have thought.

But I think if you'd include closet indexes, it's got to be close to what? 85%. Totally. But we keep seeing this. that when everybody leaves, it's like, wait a minute, an index can't be overweight stocks. It's the active managers that are overweight Amazon, Google, and Facebook. Exactly. Like when people say indexing is propping up the value of certain stocks, there's no way it can because it buys them in proportion to their market cap weighting, which is where all the money's going into index flows

for the most part. It's a huge percentage of it. So I saw an article, are we done with this? Yes, we just busted that myth, wide open. Yeah, we'll never be brought up ever again. You're welcome. I saw an article in the journal that sort of reminded me of the way that value investing works. And it talked about a fund, not I don't want to say finally, but coming in and putting a lot of money into yellow cabs. All right. So it says that buyers such as Marblegate have paid less than $200,000 apiece for medallions in recent auctions down from the record $1.3 million they garnered in 2013. So that is an 85% decline in price. Now, they show it. a chart in the article showing yellow cab total fares. And this is not exactly apples to apples

because I'm showing down from 2013 peaks, but this is down 2014. So close enough. So this is showing yellow cab total fares are down 27%. And again, prices are down 85%. So this is what happens with value investing is that anybody who steps in is buying some shit. There's nothing necessarily attractive about yellow cabs. If anything, it's awful. Because who knows yellow cab fares are down 27% from 2014, but maybe in three years, they're going to be down 70%. So this business is in decline. However, like I said, prices are down 85%. So maybe, just maybe people got too pessimistic and maybe things aren't, maybe things are bad, obviously, but maybe they're not that bad. So to put a neat little bull on this, yellow cab is best buy and Uber is Amazon. There you go.

Does that work? That works. So wait, who actually goes in and buys these medallions? Is it investors that can do it? Is that what you're saying? Or is it just, it looks like a, Yeah, no, it looks like a hedge fund went in and bought a lot of the... Okay, that is pretty interesting. Yeah, this is a cool chart. We'll put that in there. So there was a piece this week in The Daily Beast and talking about how Amazon and Walmart want to get more into the health industry.

So here's the, this is from the Daily Beast. On Tuesday, Amazon secured a patent for technology that would let its artificial intelligence assistant Alexa analyze people's voices for signs of illness and those of cues to sell them products. That same day, Walmart secured a patent for interactive display that can sing. up with another pending Walmart patent, a shopping cart handle that can read a customer's biometric data. So they want to get ahead of this stuff. And I don't know if this is them wanting to get into the insurance game because they also talk about how John Hancock wanted

to encourage their customers to wear a Fitbit. But it sounds like they're making a push into healthcare to be able to sell people more stuff. Hmm. Is that, I wonder, what can you hear from someone's voice that tells how ill they are? Like, is Alexa going to say, Ben, it sounds like you have a cold. Here's some cold medicine. I don't know. It's interesting, though, because I can definitely see a world where all the insurance companies are not going to want to, they're going to want to track people more closely. And if Amazon and Walmart can get in there with the sheer number of customers they have, that could be interesting from an insurance standpoint. Cool. Okay. All right, let's move on some tweets of the week. I'm going to skip this first one.

Sam Rowe shared a chart from BlackRock showing the annual price return of the S&P 500 index and the median stock return. And the one that really stands out in this one is the S&P climbing, let's say, 20% in 1999, while the median stock was negative on the year. So this is the chart that shows when a handful of stocks are really propping up the market, which a lot of people have been saying has been happening in the last few years. And alternatively, when the biggest... stocks are dragging the indices lower. So after the tech bubble burst in 2001, 2, and 3,

the median stock outperform the S&P every year. Yeah, this is a cool little chart for people like to dig into this stuff. Actually, you know what? It looks like the median stock outperformed in 2001, 02, 03, 05. Kind of cool. All right, so we'll put this on the show notes. This was a supriser. Tesla outsells Mercedes-Benz in the U.S. for the first time ever. In the third quarter, July to September, Tesla sold 69,925 cars compared to Mercedes-Benz, which sold 66,542 vehicles. That's kind of nuts. So Elon Musk tweets aside and financials aside. Maybe I guess you can't put the financials aside, but whatever, they are producing it looks like.

I'll bet if you put this one on Twitter, you could find a lot of people to take the other side. I don't think I've ever seen a company that has so much confirmation bias built into it, where it doesn't matter what the news is or what Musk has done that. day, the people who like the stock will find something positive to spend and the people who hate it will find something negative to spin about it. Well, back out the cars and they didn't really sell any cars, did they? That's fair. All right, listener questions. We got a few here. All right, as it relates to retirement and long-term investing, one area I don't recall you guys touching on in any prior episodes was an HSA account, which is a health savings account. I think a lot of millennials are given this option these days and pending on the plan,

one salary and saving. This could really be a game changer down the road. However, if you're older and married with a family, and HSA might not be the best option. What say you? I don't really say much because this is out of my lane. Do you have anything to say? So our colleague Blair Ducane wrote about this on her new blog called The Bell Curve, which is one of my favorite names of any blogs that we have out there. And she wrote a really good piece on this, and she kind of breaks it down. We'll make sure to put that in the show notes. And it basically talks about the fact that it's a great way to sort of save pretext dollars. Unfortunately, she found one of the surveys, the studies that around 20 million Americans take advantage of it

and most of them are the wealthy. So unfortunately, this is kind of good tax deferred saving vehicle that usually gets used more by the wealthy than anyone else. So like everything else. Yeah, pretty much. It's definitely a good option. I think one of the downsides of it is like there are so many different tax advantaged accounts that you can take advantage of these days. So if you're using them all, a 401k and IRA, a 529 and HSA, I think it can get a little confusing for people in complex. It would be nice if we could just sort of mush these all together and make it simpler for people. You've been quite clear on the podcast over the past few weeks that you think it's incorrect to be invested in financial markets with money or saving towards a short to medium-term

goal. I'd like to know, does your answer to this question change at all? If you anticipate having the flexibility to push like a lot further by five to 10 years, what do you think? I think, so this reader's talk, your listeners talking about buying a property and if things don't go as well as they like, maybe they can wait a little longer. I guess if you're flexible, that That's fine. If you have the five to 10 year cushion, that makes sense. It's kind of like trying to double time the market. So if you're trying to use this for property, so you're maybe you're waiting for real estate to look attractive from a buying opportunity and stocks look attracted from a selling opportunity, which might not line up so neatly. So I think that could be an issue. But I mean, if you if you have flexibility in your plan and you have decade long window, I think that's probably not the worst thing in the world. But I think you maybe want to be a little more balanced in how you allocate assets in that in that equation. Yep. That's all I got. It's a good answer. I plan on doing a 100% stock portfolio in my 529 and only checking on it every six months or so.

But this got me thinking on a larger topic. If I don't care about volatility because I literally won't be checking it regularly, should I still allocate to fixed income? Said another way, does increasing volatility and correlation also increase risk? What do you think about people using 100% stock portfolio in any situation? I'm totally fine with it, assuming that they have 18 years ahead of them. Yeah, that's fair. If you really can stomach it and not even looking at the market value, but just understanding that,

it's going to change a lot. And I guess you have to understand how close you are to that goal if you're just starting out versus getting a little closer. I have to check to verify this because I think that the New York plan offers you like a glide path. But maybe I did it myself. I honestly don't remember. But I think that I'm 100% stocks and probably will be for a long time. The one I'm in is like that too, the Michigan one where it's like a target date fund that eventually the closer you get, the more bonds it adds. And I think that that makes sense. And it's pretty easy for a lot of people depending on what state you're in. But I think a lot of people assume they can handle 100% stock portfolio and in reality cannot. But if you can, I mean, the only huge downside is, of course, stocks have a massive, massive decline. And then you're just out of luck and there's not enough time for them to come back. that's why you should probably, I mean, yeah, it's closer to time to the time that you're going to be using these funds. I don't know whether that number is when the child is 12, 13, or 14, but at some point you should probably go away from 100% stocks. In fact, you definitely should.

Yeah, that makes sense. All right. Any of my recommendations this week? Did you read anything on your plane ride? I did. So I went to my first Amazon store the other day, and I was blown away, but then I'm thinking like, wait a minute, am I just blown away? Because, I mean, it's just a bookstore. but am I impressed by the Amazon sign? Like, what is it? And then I realized what it was. All of the books face you, which is awesome. So when you're in Barnes & Noble or library or whatever, you have to crank your neck, right?

Because some of the books are facing full, but a lot of them, you just see the spine. Ah, huh. That makes sense. I never would have thought of that. So I bought a book, and it's the same price as ordering it online, which is great. So I bought Doris Kerns Goodwin has a new book called Leadership in Turbulent Times. and it is fantastic. She's fantastic.

It covers Abraham Lincoln, Teddy Roosevelt, FDR, and LBJ. And it's just awesome. Really great, cannot recommend it highly enough. But when I bought that book, I was given a free trial to Audible. And I have not done any audiobooks so far. But on Saturday, Robin was working. So I had Kobe. And it was a beautiful fall day.

So we were walking. We spent, I don't know, a few hours. hours walking around the city or my neighborhood. And I had a great, great experience listening to City of Thieves. I don't know what's that one. So City of Thieves is by a guy, David something. I'm drawn a blank on his last name. He's a writer for Game of Thrones. He wrote 25th hour. So he writes novels and he writes TV shows. Oh, so it's a novel. David Benioff. That's his name. Oh, okay. Yeah, that name sounds very familiar. So the book, the book was freaking awesome, but it was just really a great experience listening to it. And of course, there are some parts

you know, where I got distracted and stopped paying attention, had to rewind a minute or two to catch back up. But I think that I'm going to do this going forward with either historical fiction books or just fiction because I love fiction. I just, I don't read it because I feel like I'm not learning anything, which is kind of dumb. So I canceled my audible, but I think I'm going to get back on it. So the other book, so I finished City of Thees was great.

And then on the plane ride, I started listening to the city of the monkey god, which is also are really good. You probably recognize the cover. Okay. All right. Anyhow, I tried one audible book and it just didn't work for me, but I'm willing to jump back in if necessary. I think that it probably won't work on the subway, because I do think it's like you get easily distracted, but at least for walking when there's no distractions, like it was a really pleasant experience. I saw the other night, I saw Chapiquitic. Have you seen that? No, I saw it was on Netflix, though. Okay. Very good. I had no idea that Ted Kennedy was a senator when that happened. I thought he was like a teenager. It is kind of a bizarre story. If that something,

that happened today. I don't know if he could live it down quite so easily. No. And it showed what a tough guy Joseph Kennedy was. And I read his book by David Nassau called The Patriarch. And he was a fascinating guy. And then lastly, this is not a recommendation, but somebody retweeted The Iron Sheik. So I was reminded that he follows me, which is like the most random thing, because he only follows 800 people. So maybe it was a mistake. You know who that is? the Iron Sheek, the wrestler? Yeah, is this a recommendation or a humble brag? No, neither.

Maybe a humble brag. But I have a question. Who's the most random person, like semi-famous person that follows you on Twitter? Doesn't Tay Diggs follow everyone? Who? Oh, I don't know. He doesn't follow me. I don't think.

I got a follow from Adam McKay a while ago, the guy who did all the Will Ferrell movies. Oh, that's cool. Maybe that one. He's the guy who did the big short movie, too. I think it was actually because he retweeted one of your pieces. But, yeah, I don't know where this is going. All right. I got a movie watch this weekend called Hotel Artemis.

We rented it. It was almost like a throwback to a 90s action movie. Be careful here. Be careful here because my recommendations are on record better than yours. It's confirmed. According to one person. It's confirmed. I took a survey.

Okay. So this is Hotel Artemis. It's only an hour and a half, which I kind of liked. It's with Jody Foster and the guy who plays Randall and this is us, who I really like. And Jeff Globom's got a little piece in it too. It's like a throwback to the 90s. and it was a movie that's like 10 years into the future, and the hotel is for criminals who need a place to lie low

when they're on the lamb and get stitched up when they get hurt. And it's like kind of a weird apocalyptic view of the future in some ways, but this was a good kind of mindless action movie. And I think with your taste in movies of like Alien versus Predator, I think you'd like this one, especially since you like those. What's a guy's name, Jason Stath, the movies. This is kind of a, I don't know, a recommendation, de-recommendation. We started watching The Deuce on HBO because we had,

had a bunch of people tell us about that. My dad likes that show. It's about 1970s, New York, and kind of how just it wasn't that great back then. It's a show about pimps and prostitutes and cops and bar owners. I just think we watched four episodes and we gave up. It's a decent movie. It's about the guy who made The Wire David Simon. Five years ago, I probably would have just kept plugging along and watched it, but it just didn't quite get my attention as much. It was good, but not great. So we gave up. I just gave up way too easy and shows more than I used to. Finally, a book I've been reading called The Systems Bible by John Gall. I forget who recommended this one.

Patrick O'Shaughan to see, always talks about that. Okay, I read it. The tone of the book is kind of bizarre, but it's really good on like systems and simplicity versus complexity. Wait, what do you mean? What do you mean the tone of the book is weird? It's hard to explain about reading it. It's not your typical, like, psychology, Malcolm Gladwell book that you get these days.

It's a little, it was written a while ago, I think, and that's probably why. So it's just not your typical nonfiction book, but I still like it. and he talks about a lot about how complex systems can be so difficult to, like, overcome the unintended consequences. And I like this one example. He said, the French built this underground line of fortresses aimed at Germany in World War I, and it was like their ultimate trench warfare strategy. In 1940, they said the Germans simply went around it, and the cannons were pointed the wrong way. And then only then did they realize that they couldn't actually turn the cannons around, so they were just screwed. So he has a lot of examples like that that are kind of like,

So I did a lot of highlighting this book. So I really like this one. That's pretty good. And yeah, that's all I got for this week. Oh, well, I'm making this, we're doing this podcast. I'm going to closet. All right. This is true. You're New Orleans for the week. Or Norlands, Austin. You're on a little road trip. Yep. So, all right. By this time next week, stocks higher or lower. Unchanged. All right. That's a good one. All right. Thanks for listening. Leave us a review. Send us an email atadmalspiritspod.com. And we'll talk to you later. You know what I'm going to be.