Animal Spirits Podcast - The Leverage Mania (EP.388)

Episode Date: November 27, 2024

On episode 388 of Animal Spirits, Michael Batnick and Ben Carlson discuss: great stock market returns so far for 2024, Bluesky vs X, the impact of tariffs on the U.S. economy, when to sell Bitcoin, money in college athletics, a lightning round of vacation thoughts, and much more! Thanks to Global X for sponsoring this episode. To learn more about Global X’s entire suite of ETFs, visit: https://www.globalxetfs.com/ Animal Spirits survey: https://www.surveymonkey.com/r/ZBBJ69Q Sign up for The Compound newsletter and never miss out: thecompoundnews.com/subscribe Subscribe to The Unlock newsletter: https://www.advisorunlock.com/subscribe Find complete show notes on our blogs: Ben Carlson’s A Wealth of Common Sense Michael Batnick’s The Irrelevant Investor Feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation.   Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Ben Carlson are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. The Compound Media, Incorporated, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. For additional advertisement disclaimers see here https://ritholtzwealth.com/advertising-disclaimers. Investments in securities involve the risk of loss. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. The information provided on this website (including any information that may be accessed through this website) is not directed at any investor or category of investors and is provided solely as general information. Obviously nothing on this channel should be considered as personalized financial advice or a solicitation to buy or sell any securities. See our disclosures here: https://ritholtzwealth.com/podcast-youtube-disclosures/ Learn more about your ad choices. Visit megaphone.fm/adchoices

Since 2008, GlobalX ETFs have been committed to empowering investors with unexplored intelligent solutions. GlobalX specializes in exchange traded funds that offer exposure to the artificial intelligence ecosystem, including themes like data centers, robotics, semiconductors, and cloud computing. To learn more about GlobalX's entire suite of ETFs, from covered calls, fixed income, and merge markets, and more, visit GlobalXETFs.com. Welcome to Animal Spirit. a show about markets, life, and investing.

Join Michael Batnik and Ben Carlson as they talk about what they're reading, writing, and watching. All opinions expressed by Michael and Ben are solely their own opinion and do not reflect the opinion of Riddholt's wealth management. This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Riddholt's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. I want to start the show by thanking all 1,300 of you that filled out the survey. Thank you very much for doing so. A little bit surprised that our audience of financial professionals is smaller than I would have thought.

However, I have a hunch, Ben. I have a hunch. What if the financial professionals are not doing their part? What if they're not filling out the survey? Because I say, we'll let the other people do that. If you're a financial professional and you are listening to the show and you would like to do us a solid or not, there's a link in the show notes.

Please, we'd like to hear from you. Listen, if we poisoned the well being an anti-survey podcast, that's on us. You need to help us. No, that is on us. But you need to help us by putting in the right answers because we're not trying to lean you one way or another. We just want to know some general information.

All right. So, Ben is coming to us live from, are you in the Dominican Republic? Yeah, Punta Kana, Dominican Republic. I'm not going to say that I thought Putticana was Mexico. I'm not going to say that. I'm also not going to ask, I'll ask, how are you an hour ahead?

How is that even possible? I thought most places were behind. Not going to lie, I did not realize we were somehow passing some, I timed travel to get here. I flew through Bermuda Triangle or something. All right, given that I, I wasn't exactly sure where Putticana was. I joke.

I might have known that it was in the Mexican public. Who's to say? I kind of thought that was like due south of the East Coast, but I guess it's to the right of the map. Well, there's many beautiful places in the Caribbean. This is one of them. Great people. I have some travel thoughts.

I don't know if you want to get into it right away or save it. No, no, no. We could save it. Okay. It's on the travel section. All right. Let's get into the stock market, shall we? Okay.

Let's do it. Okay. Where do you want to start? You got to hear some stuff on this at the top. Are you worried that things are getting topy? Are you worried that people are worried that things are getting topy? No, in fact, what I had in there that I moved over to what of your thoughts, Doc, or all of the things that people said up to now had been the top.

For example, the NVIDIA watch party, that was like a 20% ago. Oh, yes. You know what I mean? Or when the CEO signed the woman's bra or whatever, signed her chest. Yeah. That was going to be the top. Okay. Char kid Matt did an annual sector return form going back to 2014.

total returns, and surprise, surprise, technology is at the top. At the top, it's up almost 800% since 2014. The second place is consumer discretionary up 271%. So technology obviously dominating, not surprising, I guess. This is pretty nuts from Bloomberg. So they looked at the California budget, and they say that stock pay at the four large tech companies accounted for 10% of the revenue. in 2024 in the first half of the year for income tax withholding. That's Nvidia, Alphabet. Dang it, I should call it. I meant Google. Invidia, Google, Facebook, and Apple.

The top 1% of California earners pay nearly half the state's personal income tax collections. You know, Ben, I don't know that I've ever seen you in a hat. And also, you're breaking your rule. I believe it was you who said if you're over 40, you can't wear a backwards hat. That was you, no? Oh, that's definitely me. I said once you become a dad, you can't wear backwards hat. Guess what?

I'm a middle-aged guy now, and I'm going through midlife crisis. So backwards hat. I just came from the beach. Went for a nice walk on the beach this morning. And my son was jumping with joy because he was, there's been a lot of waves here. And they've been red flags. We couldn't go in the ocean.

Today was a yellow flag day. So he was psyched. So after this, I'm going to go get pounded by some waves. You know, just back to the back to the, the, the, the not top stuff. Let's just say that we are near some sort of top. I feel like the Jensen bra thing, the Nvidia,

like how much time needs to pass? You know what I mean? Like, because if this is a top, even though it wasn't like the exact tippy tippy top if after the signs of the top we ran another 20% and then we fall 30% and we're talking like five years in the future

we'll still say that those are pretty good signs at the top though so I feel like it's too early it's too early to be super dismissive is all I'm saying yes and there have been a million things that have been said about anecdotes of okay this is it and something is going to do it but it's trying to guess which one it is is really difficult

now if we were to zoom out and take a look and plot all of the signs of this is the top, that people were saying this is the top, all the magazine stuff over the last 10 years, we'd have a long list of things, right? Yes. Yes.

And you did a good job of doing this on, I guess yours were more risks, but yes, people have been calling for the top since I think 2013, really. All right, and here's another potential wall of worry for us to climb. Although, actually, this is not a wall of worry, but it's just potential reason to be concerned.

Not a wall of worry. Bank of America. U.S. stock market concentration hit record high in 2024. All right. So they're looking at the top 10 companies as a percentage of the total S&P 500 market cap. And at the peak of the 2000 bubble, Microsoft, Cisco, GE, Intel, Exxon, Walmart, Oracle, IBM, Citigroup, and Nokia were roughly 27%. Who was the one who said that this is a bull market phenomenon and then the bear market things? Because you can see in 2022, this reversed.

Mobeson. Okay. So this reversed in 2022. Moposon's concentration as the features of bull market that sort of be careful what you wish for. Nevertheless, I don't know that extreme concentration is a good thing. The top 10 stocks are now 36%. Microsoft Apple and Video, Alphabet, Amazon meta, Berkshire, Eli Lilly, JPMorgan, and Broadcom. Do you think they're really going to like make Google spin out Chrome?

No. Because that's, they can't do that, right? I don't know enough to say can't, but I would, I would, Guess that they're not going to. Okay. So Nick and Jessica over at Datatrack tweeted, we lose no sleepover an S&P 500 that owns heavy doses of outstanding global companies. As an index, it does something many active managers likely wish they could do, take meaningfully

large positions in superior companies and stay with them over the long term. And it's funny that this is like a courageous thing to say, even though it's pretty commonsensical, right? Because the knee-jerk reaction, I think everybody's spidey senses sort of tingle when you see a chart like that, you think it has to be mean reverting, which it doesn't. So I think Nick and Jessica say something that is, again, seems like common sense, but that people would be like, well, that's an outlandish take or that's a contrarian take. I don't know why it should be.

Can you imagine being a large-cap growth or a large-cap fund manager right now? Anywhere in the large-caps industry? I guess in the growth sector. That would be a large-cap manager than a mid-cap manager, small-cap manager. It's got to be so difficult to look at these percentages and go, okay, I'm going to play or I'm going to overweight them to try to outperform. It's got to be playing huge mind games with you at this point. those big top six, ten, whatever it is.

It's kind of funny that, so you show the names on here, Berkshire Hathaway being one of them, they're a trillion-dollar company now. It's funny to think that, oh, well, this thing is past Buffett by. He's kept right up, kind of. They're one of the trillion-dollar companies. Speaking of signs at the top, when Apple crossed a trillion dollars,

I think that was 2017, but I'm not positive. That was very, people were screaming, right? It's another one of those things where the numbers just, they seem outlandish at first, and then people get used to them, and then it's kind of like, oh, okay, this is it. We have a trillion dollar companies now. Yeah. All right. I did a little reading on the way down. I filled up my Kindle before I left. And one of our readers actually, or listeners, emailed a couple weeks

and said, hey, I got a new book for you. So I decided to check it on the way on. It's called Boom. Bubbles in the end of stagnation by Byrne Hobart and Tobias Huber. Burn Hobart has a substack that many of you might follow. What's it called? The diff. Yeah, I'm a subscriber. Okay. And this is one of the better books that I've read in a while. I haven't read a good nonfiction book in quite some time. I pretty much just read all fiction these days because I feel like nonfiction, I don't know, I just can't get into it. This was very good. And I'll say this, not to pat myself on the back, but I think it's hard to do sometimes. Maybe I'm patting myself in the back. To disagree with something in one of these takes, but also really agree

with other parts. So the whole point of the book is, I'll read you this. After the Manhattan Project in the Apollo Program, whose major technological innovations, atomic bombs, nuclear energy rockets and semiconductors were largely physical. Progress became increasingly confined to the virtual. And their whole point is that it's kind of hard to believe. They say progress is stagnating while innovation is still going. So, because I thought about this, why are they so down in innovation? And they're saying, listen, we haven't done anything physically. And they give this example where they say, listen, you can book a trip on the New York subway to fly from New York City to Tokyo and do it all on your phone. And that's great.

but the physical infrastructure that you're writing on was built in 1970 and trying to build that same infrastructure today would be impossible. And so they're saying, yes, they say progress is slow, while innovation is increased. And it's basically just the stagnation comes from these breakthroughs have all been stuff in phones and technology, stuff that maybe makes your life more convenient, but doesn't necessarily make us push forward and push the bounds.

And so their whole point is we need to have more bubbles and they say it in a good way. Like they say the Manhattan Project was a bubble. Like to like a track capital or what exactly? To track capital and ideas and kind of just let things happen. And their whole point is kind of just we need to just let stuff happen and stop being so risk-averse with all this stuff. And stop worrying so much about what technology can do and just let things go. Which is interesting.

But you know what? This is where politics comes into it because I think people are generally risk-averse and it's so easy to win the electorate by sort of scaring people and saying like we can't do this. Okay, so I listened to a podcast with Ben Thompson. He interviewed Bernholbar about this book. And at the end, they talked about politics. And I didn't really put this again. I listened to a podcast with Brad Gersner, too, and he talked about this. And I never really put this together during the election, but now it makes so much sense. The Silicon Valley crowd doesn't think that Trump won the election. They think they won the election. Like Elon Musk is their surrogate. Because look at this. So, and they talk about the fact that they just want to let things run. And they want to let. Right. Not entirely untrue. I mean, it's a reasonable, did they not push them over at the edge, or help to at least? Oh, I mean, the richest man of the world spent a lot of money. So it's, it's something. So the Washington Post has a story saying that Mark Andreessen and Joe Lonsdale, he's the guy from Palantir and Travis Kalanick are going to be on this, this Doge thing to try to make things more efficient in the government. And I guess it makes sense. Who's going to be on the Shiba project? But they, this was bound to happen. Silicon Valley has so much money in power now,

they're not these little upstarts anymore. They have a ton of power. So it's kind of like, I guess this was bound to happen at some point. Will they like the results? Will they like having less red tape is what they want? And they just want to do stuff and not have the government get in the way. I think that was their whole problem. And that kind of comes back to this booms and bust thing.

So I think it's going to be interesting to see as an experiment. Do they get into the government sort of periferate, get into the government, I don't know, the books or whatever, however the government works and realize, like, we can actually make some meaningful change here or do they look at it and they go or do they get in and they go oh my gosh i can see people have been trying to fix this stuff for years and it's it's impossible at this point so i it's interesting but but my whole point is i think they see this election as kind of like listen this is our turn just get out of our way whoever whatever party we're

affiliated with we just want them to get out of our way and let us do stuff so i think it'll be interesting to see if they can do stuff now like it actually builds stuff and not just make gaps for us. I think regardless of your political affiliation, we should all be rooting for this experiment to work, obviously. Yes, but I can't believe I kind of missed that. Like, oh, the tech people, it's not like, for them, it's not Republican or it's not Trump. It's, it's get out of our way. Let us tinker and do stuff. Yeah. All right. Well, yeah, no, you're right. It's going to be very interesting to see how they do. Yes, if they can actually do it. Okay. I feel like this happens. You guys, you and Josh had a great conversation.

with Cliff Asness. I snuck away to the gym the other night at the gym at the resort. Not to brag. Nice little gym here. And I put on my headphones and I listen to you and Josh and Cliff Asness. And you talked about market efficiency. And I thought that was a really interesting conversation. For people outside of the industry, it might seem like splitting hairs. But I think it's an important conversation. But there was this news saying that investors confusing blue sky with a Toronto blockchain company send the stock soaring 1800%. Which is kind of funny that the fact that it's a crypto stock didn't do it. It was being affiliated with a new social media company. And the firm even said, like, listen, we're unaware of anything that happened here that caused anything for our company to do better. It's just people, it's a market efficiency thing, right? But what was close to the point? Like, okay, fine.

You say the market is inefficient because these stupid stories happen. Fine. Create a fund or a strategy and make money off of it, which is impossible, obviously. Yeah. Which was a good point. So this is from the FT. They show that blue sky users have not overtaken threads. And that happened in a hurry.

And I'm starting, so it's daily active users are closing in on 3 million. Threads never really felt real. When we talked a little about Blue Sky last night, I feel like it might have legs. I don't think you're quite there yet. Are you on the platform or not? I just sent my first, what are we calling it? Sky. Why don't know if it has a word?

Blue? Sky? Post? I did a meme. I did a meme. I did a meme. I did my Michael Sailor meme. Did you see the, you know, when, when I, I, I,

Otto Octavius is like trying to control the sun and the thing with his arms. Remember Spider-Man 2? Oh, okay. Gotcha. And that's the Michael Saylor? So I said, Michael, I was just saying I tweeted. I wrote when Michael Saylor and Micah Strategies market cap hits $47 trillion. And the caption is, Otto says it will stabilize it's on the control.

Okay. You said that to me and Josh. That was like you were trending on Slack first. Yeah. That was pretty good. So I think the best part about it is... Anyway, there's zero response. Zero like, zero...

It'll take a minute. Swig of a mess. It takes a little bit. But here's the thing. You're starting from ground zero in terms of followers and such. And I know there's some people who will migrate over from Twitter, but it's actually kind of refreshing to start over and build her way back up. I mean, it is kind of annoying that you already build a following somewhere else and

you've got to try to do it again. But here's the best part for me. It feels like there's a lack of perma bears and psychos so far. I know they'll come if this thing gets big enough. Yeah, give it a minute. But it does feel fresh. And I think it has legs. I think there's, especially in terms of the finance people that we follow,

unfortunately, I think we're going to be dual screening it for a while. We'll see if it actually keeps going. I don't know. It does seem for whatever reason this is taking up. But when I signed on, it's, I don't ask you what are your interest and it shows a bunch of different bubbles with software development, education, food, journalism, whatever. You know what's not their finance? There's no business thing, which is odd.

You say degenerate movies? So, yeah, I was on, I know it's lame to complain about Twitter, but so I'll move off this quick. But, like, I hit the 4U tab just to, like, see what was up. And the first thing was a thread of all different angles of the planes going to the World Trade Center. And so I'm just scrolling for, doom scrolling for 30 minutes. And I, like, threw my phone. I, like, snapped out.

I'm like, whoa, what in the, so I have little. interest in, like, uh, tweeting again, but it is cool to see an alternative to. See, I'm not, I'm, some people were saying, oh, look at Ben's, Ben can't handle being on Twitter anymore. I'm not leaving Twitter. I'm still there. I'm still tweeting. Come on, people.

Yeah. But having an alternative is kind of nice. And I guess the one thing people are saying is, listen, there's no algorithm on this thing. It is just a feed. And you can follow your feed and there's not, there's nothing that's going to be forced to be, like people are saying, if you post a link on Twitter, it doesn't work anymore. or it gets pushed down for he doesn't want people leaving the site and blue sky doesn't have

that yeah okay yeah no that is so that is nice we'll see all right i'm you know what i'm not making any predictions into how i will use blue sky we'll see we'll see we'll see we'll see um all right uh todd sown has a chart that uh is a faceblower it's of single stock levered ETF volume and he said boy that escalated quickly i mean that really got out of hand fast and he's quote of the great Ronald Burgundy. I don't have the tweet in front of me, but Corey, our friend Corey Hofstein made a tweet last week, making the astute point that there was a lot of these ETF companies that came out and said, we're going to do this kind of investment.

We're going to do dividends or quality or something like this. And he said, so many of these places have just transitioned into two times this company or one times that company. And they brought in a ton of money. And how can you blame them if this is what people want? Yeah, no, these are, I don't blame. And credit to Corey, I don't think he was blaming them either. This is capitalism.

This is what we're here for. I had this in the DAC actually with Cliff, but I didn't get to, I didn't get to it. Corey tweeted, depression is seeing that a 2X micro strategy ETF with a 1.29 expense for EGO has nearly twice the AUM of my firm. All right, let's talk about the economy for a second.

So, wait, wait. Is this just life now, or is this a flat? in the pan kind of thing. It seems to me like this stuff is every time there's a new hot stock, this is, it's going to get more month flows in terms of the double and triple levered stuff, right? Yeah, no, I think this is here to stay. I don't know that it's like going to be micro strategy forever. In fact, it's almost certainly not. But this, whatever the hot stock is, yeah, this is how it works now. So the, the strange thing about this whole market environment, it's been this whole decade, it feels like, is you have tons of money still going

into index funds, right? Eric Beltuna's always tweets about how VOO is like the king now. He's taking in all this money that's an S&P 500 index fund. You also have all this money that's trading meme stocks and trading double levered this and crypto and there's $7 trillion in money markets. It's just, it's not like people are really picking one area of the market and this is it. There's stuff going on everywhere. All right. So the question I keep asking is, where is all this money coming from? I just, I continue to not really understand. I don't know. It can't all be coming from active mutual funds. You know what I mean?

Like, that can't be the source of all the capital. All right. So Donald Trump put a message out last night onto truth social. I think it gets recycled on Twitter. And let me just read it. He said, as everyone is aware, thousands of people are pouring through Mexico and Canada, bringing crime and drugs at levels never seen before. Right now, a caravan coming from Mexico composed of thousands of people seems to be unstoppable

in its quest to come through our currently open border. on January 20th, as one of my many first executive orders, I will sign all necessary documents to charge Mexico and Canada a 25% tariff on all products coming into the United States and its ridiculous open borders. This tariff will remain in effect until such time as drugs, and particular fentanyl, and all the legal aliens stop this invasion of our country. Both Mexico and Canada have the absolute right and power to easily solve this long-simmering problem. We hear by demand that they use this power, and until such time that they do, it is time for them to pay a very big price. And interestingly, the market didn't really react to this.

Like, this was after hours. You would have expected to see big moves in the dollar, big moves and maybe interest rates in international currencies. Well, the dollar took off a little bit. A little bit. But EW, which is in Mexico, ETF stock, it's down less than 2% today, which is, you know, all things considered what a big trading partner there. It's not a whole lot. Do you think Canada's up there going, what did we do, eh? Come on, we didn't do anything. Do you think Wall Street is hearing what it wants to hear on these policies, though? Because it feels like people on Wall Street and finance are pretty happy with his selections for the finance positions.

So I'm, so they're pretty, they think he's going to rein him in or this is just a negotiating employee. Do you think people are just hearing what they want to hear in assuming, well, he's using this as a negotiating employee. Take him. Yeah. Well, that's literally not seriously or whatever it is. We're speculating. Yeah, but the market speculation seems to be like, ah, it's not a big deal.

Well, but Trudeau said that there was somebody tweeted that they were going to speak. The leader of Mexico already reached out. So I don't know if this is going to go into effect or whatever. The market seems to not be concerned. But Ben, you mentioned that Wall Street is happy with Scott Besson, the new incoming Treasury Secretary. And for those of you who don't know who that is, he was, he's a longtime Wall Street guy, was a chief investment officer at Soros, raised, started at the time,

was the largest macro hedge fund in the world. If you're interested in learning more, I find Ted Cite, he's an interview with him. Mike Green had a really good conversation with him recently. And he seems to be, by all accounts, and I've only discovered this man, you know, in the last week or two. This is not something that was on my radar. But he seems to be incredibly reasonable.

And I feel, again, the little that I've seen of him, I feel very, very happy that there's like a sober, rational person who's going to be effectively the chief financial officer of the United States. it's a pretty important job. And maybe that's why Wall Street is not that concern, but who knows? I guess we shall see. We shall say.

But I was very happy with that. So is this going to be, I was thinking of this tear of things, but companies have to plan for this, right? And people are saying if he does these, that like, if he does that immediately, you know, because the U.S. automotive industry gets so much from Mexico in terms of the supply chain, like that decimates the auto industry. So this is going to be like the recession where people try to get ahead of this. So Sam tweeted a chart from Goldman, and it shows.

So this is Trump enacted tariffs in his first term. And there's a chart showing the PCE for prices across nine tariff-impacted categories and the PCE for all other core goods. And when Trump implemented his tariffs, the inflation for the tariff-impacted categories did go up quite a bit. But it had no impact on all other core goods. It's not to say that it won't this time. like maybe we'll, maybe we won't. But the point is last time it didn't, which is encouraging.

Right. It just depends. Are they bigger this time? So this is from Wall Street Journal. American businesses are dusting off the playbook they used during Trump's first term, stocking up on imported goods before tariffs are enacted. They're also considering how to cope with the levels if and when enacted. So they're trying to get ahead of this. Do you think that that makes it kind of almost like the member companies kind of got all like in a fetal position like planning for a recession in 2022 that never happened? Is this going to be a situation like that? They plan and they pull us all forward. And then if it doesn't happen, okay, now what do we do?

So are there waves and waves of impacts of this as people try to figure out what is actually going to happen? I think we'll say. I always defer to the market. So I think on the one hand, I take a little bit of comfort of the fact that the market did not freak out over this. On the other hand, we'll say it's two months away, right? So we shall see how this plays at.

So the thing that we keep hearing for three years now is, listen, it's not the inflation rate jerks, economists. It's the level of prices. Even if you get a one-time up in prices, how are people going to feel about that? CBS News had this poll about Trump's transition. They asked people like 50 different questions about how do you feel about stuff. And they asked him what their highest priority was. And they talked about deporting immigrants and cutting taxes and tariffs and DEI stuff and all this stuff that people have said is that Ukraine in the U.S. And the number one highest priority was we want lower prices of goods and services. Right. They don't just want inflation.

fall. They want lower prices. This is what people say that 80% of people said, this is a high priority. There was not even another one closer. Even tax cuts, this was higher than that. Are we ever as a nation going to understand how inflation actually works? Because I don't think we are. Collectively. I mean, but that's okay. I mean, how would everybody be an expert on price levels? You know what I mean? Yes. I think that this is just a lost cause, though, of explaining, like, actually. Because what you're saying is, listen, for prices to fall, the economy would need to being in a bad place and you actually don't want that. But guess what?

I think some people do because Josh made this point very... No, but they're not going to... People aren't going to take a 20% haircut and pay to have lower prices. But they don't know, no, no, no, no. But they don't necessarily have to. Like, unemployment can go to 6% and prices could fall. And I think the 94% would say, f***ed at 6%. No, no, no.

Even in the 2009 crisis, prices, we had deflation for a blip. It was not a mass fall of prices. It was, prices kind of slowed, but so did, so did wages. It's possible that some category prices fall. I don't think it's impossible. Sure, J.C. Penny could have a 50% off sale, but that doesn't mean that, but I'm saying if you want a full scale, yeah, we're going back to 29 prices, you need wages to fall. There's no other way to do it.

Yeah, yeah. I would agree. Okay. All right. Let's talk about crypto for a little bit, which is everybody's favorite category around here. You know, uh... Well, it's both sides. This is the market.

say, listen, keep talking on crypto, guys. I think it's interesting. Not, no, no, no. Not really. You have any of those emails? I got a few of those emails. Okay. I'm saying the people that really, that think it's all the scam and tulips.

Like, guys, enough with the crypto. And by the way, the guy that said to me in the airport, I'm not having it. We had a lot of people saying, he was saying, I'm not having it. There's no way. There's no way. A hundred people made that joke, which was a pretty decent joke, but he would have had to give you a wink if he did that. Yeah, we walked away awkwardly.

I think people were trying to be. funny when they said that. No, no, no. I think people were earnest in the email. There was, there was none of that. He was, he was, he was sincere. We walked away awkwardly. There was no smile. And if he did come up with that, it would have been like the quickest joke ever, right? Because he wasn't planning it to see me in the airport. So, anyway, but so I'm also not a funny joke. So, so I'm here. So, so people that don't like us talking about because I think it's a scam. And then like the real Bitcoin people who are like, you guys are such idiots. You don't understand it. You don't get it. You're missing.

All right. Well, great. So anyway, that's true. We'll keep this brief. And Matt Hogan, I have something to save. How about this? We're not going to keep a brief. This is my podcast. I want to talk about this because I've gotten some ton of feedback. So I, I've been talking to you for a while. I said, I think on last week's show, I said, when it hits 100, I'm selling. And finally, it got to 99 and change. And I thought, I just got to do it. I pulled the trigger. And I sold 25% of my Bitcoin position. And I just did it. And I put another limit order in to sell. And I didn't want to do it right at 100 because I knew if it hit 100, something weird could happen and a bunch of other people could sell. So I did it at 99. I sold some. I got to say it felt

kind of good. Like, it felt like a weight lifted off my shoulder. I've got to, and I said the reasons I'm doing it. I'm rebalancing. It's a way bigger position. It's almost 10% of my portfolio. It's bigger than I ever thought possible. You get huge drawdowns in Bitcoin. And I said, I'm practicing regret minimization and I'm doing the grand advantage. Right. Somebody said, somebody emailed us, what does Ben going to do about the taxes? And I assume you're just going to pay them? yeah no you don't have to pay taxes on crypto i heard yeah once january 20th happens there's no tax on crypto i am still holding on some eth i think i had the i had pretty much the market weight of 8020 or so i'm swilling on that because that didn't really catch up as much but i think i on my

cost basis i was up six times or something on bitcoin and i just i couldn't so i'm rebalancing and i'm using it as an is in a constructive portfolio management way and if it crashes again i'll i'll buy more probably and i'll rebalance back into the pain and i had a bunch crypto people kind of say, people were writing, there was guys, there was blog posts written about it, and people were commenting. And I had a lot of crypto people say, you know what, this is a very reason to argument. I appreciate that. You're still an idiot. Overruled. So I kind of, they're like, you know, the government's going to make it a reserve currency and it's going to go to 400. And guess what? That's why I only sold half or a quarter. I'm going to sell another quarter if it goes

up. So that's why I did that because I didn't want to look like an idiot either way. So yeah, so that's why I spread my bets. And I always say, investing it's is a form of regret minimization. You have to take a risk one way or another. If you're all cash, that's a risk. If you're all stocks, that's a risk. If your hedges, that's a risk. The famous Bogle quote was he has 50%, he had 50% of his portfolio in stocks, 50% in bonds. And he said, when stocks are doing really well, I wish I had more in stocks. When bonds are doing well, I wish I had more in bonds. So that's the whole point of it. And so that's why I did it. I'm, I'm happy with the decision. I'm at peace. Until it goes to 150, then I'm going to be pissed.

Well, listen, being at peace is a good place to be. It's the only place to be when you're investing, especially at something as volatile as crypto. Matt Hogan tweeted, 95% of the world's largest investors have zero exposure to Bitcoin, but 95% of all Bitcoin has already owned. Well said. So for me, for me, that's always been the driver. It's the supply demand, the supply demand and balance. Here's an econ 101 guy.

Pretty simple. It's not to say that prices can't go down or crash. They can and they will at some point. All right, the, the Michael Saylor stuff, the micro strategy stuff. Look at this chart. It's the most ridiculous stock chart in history. It's wild. So for those who were unfamiliar with the story, I know we went over it, but it's so crazy.

Micro Strategy last week was the number one most heavily traded security in the United States ahead of Tesla and Nvidia and double SPY and in front of it. everything, okay? Micro Strategy is a software company that loses money. It's not really a software company. It's a Bitcoin Treasury company. That's how they describe it. And I watched, so you see like clips of Michael Saylor on CNBC and he says a lot of crazy shit and things that really make no sense at all, like really and truly. But I watched a longer video that Corey Hofstein posted. And the first 25 minutes, he did it, Michael Saylor did a really good job laying out exactly what he's doing in a way that you might think it's crazy, but it's a, it's

one of the greatest financial engineering schemes in the history of Wall Street, like Hard Stop. And I wrote a post about this and I said, somebody said, oh, he won the lottery, this and that. I mean, yeah, he did, but he called his shot. And he's been laying this out for years, right? Yeah, he calls his shot, and then he smacked a grand slam. This wasn't like a mistake.

So anyway, what he's doing is... Yeah, you wrote a blog post about this and you said this is for normally to understand like what he's actually doing. Yeah, so I tried to explain it that way. So he's issuing convertible debt at effectively, different interest rates, but like close to zero, right? So he's getting free money and he's immediately buying Bitcoin and it worked, right?

The price micro strategy went up, Bitcoin went up, the convertible bondholders converted into equity, they made money, and then they did it again, and then they did it again and they did it again and again and they keep doing it. And it's spinning really quickly. And the way that he described the strategy with the options market and the liquidity and like it's it's compelling and it worked and now the question is when how does this end does it end today does it end at a much crazier number because what did I say if it keeps going at this pace by next year it'll be the biggest company in the world so it's an it was it hit a

$90 billion market cap which is bigger than Starbucks and Nike and all these other monster companies so you might say this is the craziest shit ever this is going to end so badly and you be right, but it also could get a lot dumber or it could end today. Who knows? But the point is it's wild. It really is the greatest spectacle like I've ever seen in my career. I have two things. I don't know if I'd say that because there's been some crazy stuff that's happened, but it feels a little like... Wait, hold on. What's crazier than this? I don't know. Oil going negative. I don't know. There's so much crazy stuff that's happened last four years. It's hard to pick. I'd have to think through it. It's like asking me with my

favorite movie. I can't do it right off the spot. To me, this is the number one. Okay. So I have two things. One, this feels a little bit like Tesla in that. Remember all the people shorting Tesla we're saying he's never going to raise enough money. And every time Musk was able to raise money and raise equity and that kept Tesla going, even though people thought it was going to fail. Number two, here's what I think makes, obviously people say, well, if Bitcoin crashes, this thing's going down, of course, because it did already. Wasn't it down 90% during the last crash? So here's the thing that I think makes it not end badly, but just end is, and Josh talked with this a little bit, but I have a further take. So it's other companies starting to do this.

And here's it, remember how Berkshire used to have a premium on book value? So the underlying holdings of Berkshire, people would pay like one and a half or two times for them. So right now, people are paying three to four times the value of Bitcoin for, for micro strategy. It's just if other companies start doing this and they don't have as big of a premium, investors are going to say, why would I want to own micro strategy and their levered Bitcoin play when I could get this other leopard Bitcoin play and we're not paying a bigger premium. So if other people started doing this, their premium will just shrink. And their premium goes from three or four to one to two. And that's what makes it stop going up. forever. So it's a faith-based thing. Yeah, could. That's not a bad take. Anyway, so a lot of

the people that are investors in micro-striety get upset when normies like us, like sort of are condescending or mock them. And I'm not trying to do that, for the record. I think that there's a lot of really sophisticated investors on Reddit boards that understood exactly what Saylor was doing and made ass loads of money. And to those people, I earnestly say congratulations. to the people that are phomowing now, phomowing in who don't really understand

what's going on. I'm talking to you. Just be careful. So, for example, and then there's a good article in Bloomberg about like the market makers and the people that are supplying the swaps and the leverage to the double,

like literally they're double levered micro strategy instruments, which is a whole other interesting chapter in the story. So there was an article in the Wall Street Journal covering it. And they highlighted Chase Fury, a 25-year-old trader in Newport Beach, California. He started buying Bitcoin-related stocks, hoping to the Turchase gains. He moved about, he moved all of his investments worth

about $112,000 into the defined CTF, and it's growing his portfolio to about $400,000. The Harvard graduate, the Harvard graduate, okay? So to the point of, no, don't laugh. It's funny to think about it this way, though, because he probably learned all these different discounted cash flow methods and he's yolo. Yeah, but credit to this kid, because obviously he's incredibly intelligent. And he saw what was happening. And he fucking made a lot of money. But, not but, his parents, he convinced his parents to let him manage $700,000

of their retirement assets. I'm guessing they were well off, but who knows? Who knows if that was like 100% of the portfolio or 10%. He said he came up with a less dangerous and smarter plan for them. He invested 27% of their portfolio in the defiance ETF and the rest of micro strategy. I'm not on board of that. I think that's a dumb idea. For his parents' retirement strategy?

Agreed. Agreed. Agreed. If you're looking at the outcome, I'm sure. They're great, but that sounds like that. Anyway, anyway, does this, does this end badly? Today, does micro strategy double from here? There's no outcome that would surprise me. But this is why Bitcoin is up a lot, obviously. And even that is not enough for people. This is why bubbles will always be part of, it's a permanent part of the process.

People are never satisfied with just saying, hey, there's big gains. I need bigger gains. And this is why this stuff will always, always happen. Yep, yep, yep. Okay. The Wall Street Journal has a piece about America's piggy banks, which we've been talking about for a while here, hitting up the home equity lines of credit. We done with crypto before we move on? That was it? Okay. I think we gave it ample time. We're going to have to do like a stopwatch, I think, to figure it so we don't go over. We need a shot clock on it so people don't get mad. So they show the value of home equity in the country is $35 trillion. And then they show the first time homebuyers. And they're calling it to piggy bank and just saying that it's unfair because first time homebuyers have gone. from, call it 40-ish percent in the 80s and 90s and 2000s. It's slowly gone down from there, and now it's at 20, below 25.

I think it's 24%. And basically just saying, like, so I think the only people who, I mean, obviously there's still first-time homebuyers happening, and maybe they're getting help, or maybe they're just the people who are well off and can afford it. But it's just that the people who have money in their home are the few people who are able to transact in the real estate market because they have that equity to play with. Yeah. It's house money.

It's free money. They can roll it over and use it as a down payment. Those are the people that will be spending more when mortgage rates fall, not first-time homebuyers. I agree. Yeah. One of the biggest themes of the last, I don't know, two, three years are first-time home buyers just getting absolutely railroaded. Yes.

Yes. And I've said for years now of any group that got screwed the most during. this 2020's period, it's first-time homebuyers. Yeah. They just got unlucky and bad timing. Nothing they did on their part could have foreseen this happening. House prices is going up so much and mortgage rates going up. Totally screwed.

Torsten slock in his daily letter wrote, as home prices continue to rise more and more households are taking out HELOC to finance consumer spending, in other words, homeowners are liquefying their home price gains and using the proceeds for consumption. combined with low jobless claim, strong wage, growth, high stock prices, solid cash flows from fixed income, including private credit, the U.S. consumer continues to do well. And, Ben, you've been talking about this for a while. This is, I don't know if this is going to, like, you know,

put a floor into the next recession or if it's going to just continue to spur the economy, but people are tapping their home, and why would it they? It's going to, yeah, it's going to accelerate if mortgage rates overfall. The Washington Post had a piece actually saying this is the biggest problem for Trump's economy right now, 7% mortgage rates. And how do you fix that? And I don't see, there's none that I can see any policies that he can do. They're going to fix the mortgage rate market because he wants growth to pick up and he wants. What if we stop buying mortgage bonds again? I mean, that's a, that's a solution. That's the only, that's what I've been saying for a while to narrow that spread,

but I don't know if people are going to be on board of that. What people? I don't know, economists, people who make financial decisions. Yeah. All right. Email question. Just because we talked about this last, wondering if you could elaborate why it's a bad strategy to pay off or accelerate payments on a 3% mortgage. For me, I just don't want

to make payments for the next 25 to 30 years. I would rather get out of the mortgage and have a possibility to make income on it through rent one day. Thoughts. Okay. I just think it's the, it's one of the biggest financial assets

you have because after inflation and the interest expense that you can write off for your taxes, you're effectively borrowing at zero percent in a 7% world. I don't know why you would ever want to give that up. when the hurdle is that low. It's not math.

Yeah. I say that on a, I think it's not math on a 6% mortgage and a 3% mortgage is math. How's that? I agree with you. But like for people like this, like you're not going to convince them with numbers,

right? Because this person is saying, I just don't want to be making payments for the next 25 to 30 years. It's not a numbers thing. Yeah. And I still don't get it. It still doesn't make sense to me.

And I get where he's coming from and I still don't get it. I'm with you. And this is, okay, because this is like a personal, this is a personal decision. Yes, but he still shouldn't do it. I agree.

All right. Survey of the week, except for hours. Like and subscribe. From Matthew Miskin. He tweeted, a difficult element in tracking this economic cycle is that soft data, which is surveys, has been weaker than the hard data. Love this chart from NFIB showing the conversion starting, business, consumer surveys likely to be more indicative of real growth.

So again, another huge theme of not just this show, but economics talk in general for the last couple of the years has been the disconnect between the hard surveys and the soft surveys, meaning like how is the economy doing? How do people feel it's doing? Okay. And the good news is that the soft, how people feel, it started to converge. Would it be funny if this happens right as the hard stuff is going to roll over? Like the sentiment comes back and then the actual numbers go down.

That would be funny. So this isn't just a Trump thing this bottom a couple of years ago, although it certainly seems to be kicking into over here now, which I, to which I say, wonderful. Because if people feel better about the way that the economy is going, then the vibes will improve, right? That's feelings. And hopefully they will start to spend more and feel more comfortable

on making investments. This should be good for growth. Yeah, but the funny thing is that people will still spend a ton of money when the vibes were down. So I don't know if it matters. True. True, true. We'll see. But I think the vibes and the vibes have been totally disconnected from spending for a long time now. I don't know if that ever. Okay. That's not, that's not, you're not wrong, but I would love, I think it's good to see people feeling better.

All right. So you know the Tom Hardy gift from, if you're, what's a Frereosa movie, Mad Max? Where he goes, uh, that's bait. Yep. This is from Axios salaries. Americans say they consider the minimum to be for the next success successful. Boomers, it's 100K. Gen X, it's a little over... Show me the survey questions. Show me the source. I don't believe this.

I don't either. So Gen X says 200-something, millennial say 180. Gen Z says $587,000 to be happy. The average is like 270. Obviously, Gen Z pulls it up. This is an engagement-bate survey to get people mad on the internet.

There's no way this is real. No way. Because a lot of people are saying, oh, see, Gen Z, they're so coddled and they're disconnected from reality. And there's no way this is a real survey that they think they need $600,000 to be happy. And boomers think

need 100. Thank you, Ben. You're saying the truth. It's a fake survey, people. I can't prove it because I didn't see the survey, but I know it's true. I know it's fake and you know it's fake. I had a friend sent this to be. Yeah, this is fake. This is fake news. This is bullshit. There's no fucking way. There's no way. Nice try. Not buying it. All right. So I have a take here. I think we got a minor reprieve from incoming inequality and wealth inequality in the 2020s because the pandemic, but that was an outlier event and it's a one-off. and I think inequality is just going to explode and get worse from here because I think the attitude towards inequality has changed. I think it's always been the case that money can buy everything, by anything, but it used to happen behind the scenes.

Now it's in your face out in the open. So here's an example. I'm a Michigan football fan. It sounds to me, so Michigan just, I don't know if you don't pay attention to this because you're in New York and people in New York City don't pay attention to college sports, right? So the number one football recruit in the country is a quarterback who plays in Belleville, Michigan, which is right down the street from Ann Arbor where Michigan is, so Michigan should have had this. but LSU signed him. And then they had this NIL money, right, where you can pay college football players now, or college athletes. And Michigan didn't do much of that before.

And finally they went to their rich donors and said, listen, all the other teams are paying a bunch of money. Ohio State went out and paid $20 million to get a roster last year. We need some money. And Dave Portnoy said, I'm going to give $3 million to get a quarterback. And little that I know, Larry Ellison's fifth wife went to Michigan.

And Larry Ellison came off the top rope with, I don't know how much money to give this kid. but it's a ton of money in Michigan flipped the number one recruit in the country to be their quarterback. Oh, that's awesome. And so for me, I'm thrilled. If I was a fan of the team

that we took him from, I would be so disheartened. And this is going to happen. So my point is... True. So Nike has the Nike guy, Phil Knight, basically told Oregon, open checkbook.

How much every one do you want for stadiums and jerseys and people on your team, I'm going to do it. So I think there's nothing standing in the way the inequality train right now because big money people, like, it's not like it's a, it's not taboo anymore to just

push your money. It used to be like, we're going to do behind the scenes a little bit. Now it's just everywhere. Yeah. All right. So, I mean, capitalism has lifted so much of the world out of poverty. And unfortunately, this is one of, this is, this is what comes along with it is, is wealth inequality.

Yes. And for me, it means it a more than a country, so I'm happy. But, yeah, this is, this is permanent. I guess you have to take the. bad with the good. I just, my senses is going to get worse. That's,

that's why I've fallen in this. Well, maybe I'm making a leap here. It's not going to get better. Unless, I don't know, maybe economic policies coming to the White House

will improve growth radically. Who knows? Who's to say? I don't know. Hope it does. Well, if growth improves radically, people who will benefit

the most, be the rich people. But I just think there's no stopping this train. True. All right. Let's talk about driverless cars for a second. I saw our friend Tom Morgan tweeted a video, Joe Wisenthalt did the same thing.

And this is such a great example of how we... Are you done it or not? No. Okay, either way. We don't celebrate good news. By the way, I saw a gas for 279, I think, or 289, whatever it was. Is anybody championing low gas? Does anybody give a shit?

Do we only talk about things when they're bad? We have actually driverless cars. It's pretty amazing. And nobody seems to care. Maybe it's because it doesn't... Probably because it's not happening where we are. That's probably why I don't hear about it. Getting back to that boom book, this is a form of progress.

If this actually happens and it's a real thing. But it is real. It's happening in multiple cities. And I feel like it's not getting the magical coverage that it deserves. It's, holy shit. They're self, they're driverless cars. Like 150,000 rides a day or something. Is that the deal?

It's a, it is. When does this become a political issue? Where in the future, people say, I'm not driving one of these fancy cars. I'm driving my truck. and that's, it becomes a political cliche eventually, right? Like, there's going to be the non-drivers and the drivers. I feel like those are the two groups. Everything becomes political.

But, yeah, but it's, we're not talking about enough. It's amazing. Shout it. Why can you say self? Driverless cars. Self-driving cars. That's what I was trying to say. All right.

I got a lightning round of vacation thoughts for you. There we go. All right? I got a lot here. So I'm just going to, I'm going to throw a bunch of audio to you, then I have a big one at the end. So I'm just going to stop me if you want. I had my first real experience of being a middle-aged dad on vacation. We go to the airport.

My wife buys a hot chocolate for my daughter, and they gave her two an accident, so she just got two of them. She gives one to our youngest and one to our oldest. It says, here, and I said, wait, wait, wait. And we just sat down at the gate waiting for a flight. I said, that's a terrible idea. Every time we give them hot chocolate, they spill.

My wife's like, it's fine, just letting have the hot chocolate, it's vacation. And of course, immediately, all three kids have hot chocolate all over them. Spilled everywhere. It's on the seat. It's up their pants. Everyone is covered in hot chocolate.

And my wife's trying to clean it up for you. And I said, you know, I just, I told you, and I just had to be the dad that said, I told everyone, but I get no credit for it. So that was my dad moment. Wait, hold on, question. Like, did you yell? Were you annoyed?

No, no, I just, I smirked and I said, I knew this was going to happen. As the dad, I knew this was going to happen. I just want to put that out there and let it be known on the record. I said so. And then everyone said, yeah, whatever, we don't care, we'll move on. Number two, why does, why are so many faucets that's now don't have the H and the C or the blue and the red for the hot and cold?

You get into a hotel shower. Such a great point. And you have to stay there for like 60 seconds and turn it this way and wait, and turn it this way and wait, and you can't just give me an H&C or a blue and a red. Bring back the blue and the red. Ben, you're making sense. Keep going. All right.

I love it. We're in an all-inclusive resort in Punta-Kana. Why do we not have all-inclusive resorts in the U.S.? Food, go get it. Booze, go get it. Fridge, stocked every night with everything you want. I'm guessing. Because we could get away with it.

Well, I'm guessing part of the reason is because the labor is so much cheap. So on a cruise, you go on a cruise. You pay for drinks, but the food is just free. Like, not free. It's part of the thing. I can't imagine there wouldn't be a premium resort that people would pay for in the U.S. for all-inclusive. Just you show up and everything's taken care of.

Just having that stress off your back of not like, I have to sign for my bill, figure out what this costs. It's so nice going into it with all-inclusive. But I'm going the other way because generally, if you have an all-inclusive place, you can't have the highest quality ingredients for the food. So it has to be cheaper by definition. True. Food's pretty decent. I mean, it's not top shelf, but it's still pretty good.

three. I made this joke on Blue Sky the other day. I got a little engagement. I love going to an island nation like this and they have their own beer. So we have Presente here. I went to Aruba before. It's Balashi there. They just make their own beer. Like, you don't have choices. Like not Corona or Dosakis. It's here. You're drinking Presente. And they call it Dominican water here. It's like Steve Jobs with a mock turtleneck wearing the same thing every day. Like, I don't have to think about it. I just know, hey, I'm getting a Presente when I go to the Swamp Bar. So wait. So wait. So wait. So when you order a beer, do you just say, can I have a beer? Yeah. Because that's awesome.

I know what it is. The best time they do is a tequila shot as a middle-aged person, middle of the day. Not at night, because that's going to, but middle of the day. I got some phone-mo the other day. I got a million people doing shots during the day, and I went to get a beer, and I ordered a shot at the keel. My wife goes, what are you doing? I go, just doing a shot at tequila?

She goes, why right now? I'm like, I don't know, because we're on vacation. So I ripped a shot by myself. All right, here's another one. Lazy rivers are an elite, elite vacation activity, and more places should have lazy rivers. If there's incommunity and they're a rich person, like, why wouldn't you put a lazy river

in your backyard instead of a pool? This place has a lazy river, and it's amazing. I don't think I've ever been on a lazy river. What is, describe this? It's just, it's a place. They have tubes, and then they have things that push you in waterfalls, and you kind of just sit in the tube, drink in your hand, and the tube goes around this huge thing

all the way around a resort. Oh, that's great. Kids love it, parents love it, teenagers love it, even the grandparents love it. People just floating around the lazy river. Elite vacation activity, because you can relax or have fun. Is this, is this? Is this a Carlson-wide family vacation?

This is, no, my wife's, so my mother and father-in-law, it's a 50th wedding anniversary. So we even have the T-shirts, you know? 50th, and they took everyone, my brother-in-law and his girlfriend are here, and my wife and our kids, so there's nine of us. And so this is celebrating their 50th wedding anniversary. Very nice. All right. You know when you go to Chick-fil-A and you realize how much better the service is there, and they say, my pleasure every time they serve you?

I don't go to Chick-A-Lay, though. Okay. So the service there is 10 times better than any other place. I feel the same way with service in the Caribbean. So when you come down here, the service is amazing. Everyone always has a smile on their face. They're always happy. The service is top-notch, and it's so much better service than you get anywhere in the States for anything. Everyone is always happy.

The people are walking around singing and dancing. All right, one more. We did an adventure yesterday. I sent you some pictures. We went to go in the jungle, like 45 minutes away. We did a zip line course, these huge long zip lines, which was really fun. And then afterwards, we got to, like, hold these monkeys.

And they give a bunch of food, and they put it on a plate, and they put it on your head, and the monkeys jump all over you. Those monkeys were adorable. Squirrel monkeys, I guess. Very cute. And so we drive about 45 minutes into the middle of the jungle in the mountains to get there. And it's going through all these little cities, and the guy is on the speaker on the way there talking about the country

and telling us about it. And all these little houses you pass on the way, these little shacks. They're not even houses. They're probably two to 300 square feet. And that's all there is is these houses. And it's a lot of poverty in the country. And the guy was telling us about it. He's saying, see these houses here?

Those are middle class. And you look at it. My kids are like their eyes are wide going, oh, my gosh. And every mile or two that he's like, that's the rich person. They own all the land. And all the other people just live here. They don't have any cars. They kind of get bused everywhere.

And the houses are very tiny. And there's a lot of trash. And it's just not very nice in these places. And the guy says, you know, I think Americans look at this and they feel bad for us. And they probably should in a lot of ways. And I looked up the median income here. annual income here is like $8,000 or something. That's what I found on the internet.

And the guy says, you know what, though, we are pretty laid back and no stress. He said, we never have any stress here. And it is funny, they're so happy. You could never go from like the lap of luxury that we lead in America and move into that setting. But the fact that they don't know any different, I guess, for the way they grew up. And everyone here is so happy. And that's the crazy thing to me is that even with all those luxuries, this is like

the happiest people I've ever seen. It's kind of crazy. And the guy said, he said, we don't have stress here. We are not stressed. We hang out. We drink. We relax. We have family.

We don't leave nice lives. And we're, but we're no stress. Yeah. No capitalism. It's kind of. And he's talking about the property taxes too. And he said, one of the reasons things are so bad on the infrastructure here is because we don't pay a lot of property taxes.

He said, you pay one time tax when you buy a house. And then if you pass it down to your kids, they don't pay a tax. So he's like, I'll give my house to my daughter someday. They don't pay taxes. And he said, that's one of the reasons. But he said, again, one of the reasons. But, yeah, again, one of the diseases of capitalism is like the desire for more. And it's, you know, it's great for all of us, but it's sort of tough on each of us because we always want more.

It's just, it's one of those prospective things that. Yeah. For sure. That's all I got for my travel thoughts. All right. The boardroom tweeted, thank you for that, Ben. That was great. Boardroom tweeted New York and New Jersey are in a league of their own when it comes to sports betting.

New York did $2.33 billion in money wagered, I think so far this year. Is that what it's showing? You know, I've been thinking about this. So I've been hot and I've been cold. That's kind of crazy, though, that it's that much more money. Do you think it's all like finance people or just everyone in New York just has that mindset? I don't know. Yeah, I don't know.

I got hoes this week, tough week for a tough week for me between the commanders and the Texas and who cares. But anyway, so I was thinking like, let's say that I lose five cents of every dollar that I bet. I've been as good as three cents, suddenly at five cents-ish. that's the tax that I pay, at some point, I'm going to have to stop gambling, right? Like, because with each passing week, month, and year, like the, the, even if it stays at 5%, the number is just going to keep getting bigger, bigger, bigger. And all of a sudden I look at my cat, be like, wait, it's not that much fun. So this is a good rolling into a...

Where does this go? Like, there was an article in Bloomberg about, like, betting in Brazil, and there's a higher level poverty there so people are really stretching to gamble. It's like the lottery on steroids. I wonder if like regulation comes back and away and the idea of regulation coming in sounds like laughable now, but is this going to eventually become

a problem in our society as well? Like at large, like not just, of course people's lives are going to move by gambling. That's not new. But like, is this going to be the type of thing where like that we have to crack down because it's like start to spread? Maybe there'll be more gamblers and on it. I think it's just going to be the kind of thing where someone goes, well, that 10% of the population has an addictive

personality. They're going to be addicted anyway. hopefully we take care of them and I don't think people are going to care, unfortunately. Yeah, I think that's probably right. So this is a funny email. I came to Arnold Spirits a couple years ago and decided to listen to the first episode this week. Pretty funny hearing Ben reveal his Bitcoin ownership.

I forgot this when I talked about it. And Michael's saying he doesn't trade stocks and hopes he never will. Now you're talking about gambling. I thought that was pretty funny. Oh, yeah. No, no. You know what?

No, he also says, wanted to get your thoughts in an email etiquette situation. Big email etiquette guy over here. someone reaches out to you asking you to provide times you have availability for meeting. You respond to that person saying that the times you are available. And then they respond saying, this time and day works for me, but they don't schedule the meeting. It feels weird that I now have to schedule the meeting that they originally asked for. Yes, if you say, if you say the 15th at noon works for me, then you have to say, I'll send an invite.

Yeah. Yeah. Or you just send the invite. Yeah. Okay. Okay. All right, another good email. I started reading Extra Life, a Short History of Living Longer by Stephen Johnson. By the way, Stephen Johnson, great author.

If I ever read fiction, nonfiction again. By the way, I was looking at my book the other day, and I'm like, oh, man, there's a bunch of books on my shelf that I haven't read, like, I would love to in a big meeting, too. But realistically, I don't know if it's ever going to happen. It's hard. I do get almost my reading done in an airplane, but it's hard to find the time anymore. Who has 40 hours or however many hours? I don't know how it takes me to read a book, but like...

It's a lot. I don't have that time. I'm going to start a new publishing company called 100 page books, nothing more than 100 pages. It masterfully tells the story of how human life expectancy has grown over the last 400 years. And anyway, the point is, one question this all got me thinking about. At what point in reading a book, is it fair to recommend it to someone else? Halfway, fully read. Such a great question because, Ben, I've got a show that I started that it's called Man on the Inside.

Now, it's the number one show on Netflix, so it's probably safe to recommend. It's Ted Danson. Are you familiar with this? No, I haven't watched it. I've seen it on the ads. Okay, I laughed out loud three times in the first episode, 30 minutes. Pretty good sign. The second episode, third. I think for a book, you have to go all the way through. You do feel, because I've done that before, I've been halfway through a book and

said, you have to read this. And then it kind of tails off, and you go, oh, shoot, I jumped the gun on that. Okay, but I think that happens with shows all the time, too. Yes. Right? We finish the old man in FX, second season. How was it? I like the first season.

the second season, it just, it was the total horse meme of great horse cartoon. At the end of the season, it was just, the whole show ended my wife and I were like, wait, what? That's how it. And Jeff Bridges and John Lithgow, and it was just, ugh. Did you watch the penguin, by the way? I'm halfway through it. Okay. Okay.

I like it. I'll save my thoughts when it's done. Bad recommendations. What do you got? Okay, so on the way down here, I watched Deadpool versus Wolverine, and I texted you, and I said, this movie is totally unnecessary. It doesn't need to happen, but I still enjoy it. It's very entertaining, a very good plane movie.

It's just Ryan Reynolds for two hours, just riffing, telling jokes. And it's, again, totally unnecessary. But I can't believe the amount of celebrity cameos in it. There is a ridiculous amount of big-name celebrities in this movie. So this screams the airplane movie. Definitely. And I was laughing. My kids kept being like, what are you laughing at?

And I'm like, oh, it's Ryan Reynolds. He just, he gets me. And he tickles your funny bone. His sarcasm is just perfect. And yes, again, it's like. Like the whole movie doesn't necessarily have a point. It's not necessary, and it's still funny. I find you finish.

Necessary. I mean, it's just, it's, it's, yeah. But as far as superhero movie goes, I would rather watch that then. It's just, it's so self-aware that it's really well done. I was about to say, is it necessary that I drink my own urine, which is a joke that I've used on this show multiple times. What is that? I know you're not, I know you're not, I know you're not a Dodge Bowl fan.

Oh. It's Patches of Hulian. Okay. Uh, I finally finished Slow Horses Season 4, and it's the worst of the seasons and it was still a great show. The last episode was great. Hugo Weaving plays the bad guy this year. Really good twist at the end. It's just, I think it's the best, I think Gary Oldman gives the best performance of any TV actor in the 2020s. He is amazing as Jackson Lamb. So, Gary Oldman is amazing in this and no one watches the show, I feel like. Okay.

It's the best show on TV right now. Okay. You know what? I respect you for saying that. I'm going to dive in. It's been on my list. Just give it the first, and each season is six episodes. Whoa, whoa, whoa, whoa, whoa. Give it what? Give it what? And I'm just saying it, give it a shot because it's only six episodes. I thought you were to say, like, give it four episodes until it gets going. The first one starts after the first episode. It's off and running.

Okay, okay. So the guy who we met last week at the Chicago live event, his name is not James, it's Brian. And Brian emailed us with a list of movie recommendations, all like these horror movies that he likes to watch. And one of them, this made me, this killed me, was. Dude bro, am I getting this? It's Dude Bro Massacre Party 3 or something like that. Dude Bro Massacre Party 3.

And he wrote in parentheses, there is no one and two. Okay. I did not see that movie, but shout to Brian. Okay. I tried to take my kids to see Wicked on Sunday. And guess what? Sold out? Couldn't get seats.

The only seats available were like first row. And there was one theater had a time every single half hour. I'm surprised that you don't walk into the movie theater like the regular, like at Cheers and I go, hey, Michael, take your usual seat in the front. So you love to see it. And it's getting great reviews. So Eric Davis can't wait to see it.

My wife took them to see the play and they love it. So they can't wait to see the movie. Yeah. So I'm going to take him on Friday. So Eric Davis tweeted, Wicked wins the weekend with $114 million domestic, 164 million worldwide. That is the biggest opening ever for a Broadway adaptation, the third biggest opening of year and the fourth biggest opening for a musical worldwide and the biggest pre- Thanksgiving weekend since 2013 and also gladiator did some numbers to the box office it's getting mixed

reviews which makes me sad i haven't seen it yet uh i will see it but i kind of wish they didn't do it well uh okay so so oh uh there's a new taylor sheridan show on paramount plus at least that's where i'm watching it called landman it's with billy bob uh john ham Larder, remember her from Varsely Blues? She's now much older because we're much older. I don't know if I'm about to say this about getting in trouble, but this is, this is, you know what?

I don't know why I would be able to say this. This show is more for men than for women, okay? I would probably say most Taylor Sheridan shows are. Okay. I'm almost ready to give up on Yellowstone. You're still watching? It's the last season. I thought I'd give it a try, but...

Okay. I mean, the guy does like 12 shows. How can any even be that high quality? I gave him credit for doing it, but... First for you, Susie's Yellowstone, some of my favorite television until it horse... I don't think I'm going to try Landman, I'm sorry. I've watched a bunch of his other shows.

I like the people's to Yellowstone, but... It's, the quality is not that great, but it's, you know, it's fun enough. Entertainment, okay. It's fun enough. It's, uh, it's brain candy or brain garbage. I don't know. I can't believe we've made it on this because I'm doing this podcast from the 3G

cell phone network here because the Wi-Fi was a little spotty on my phone. Can you imagine that? We can do internet from our phone in a different country to do a podcast. It's wild. It's wild. Right? Yes, I made it. All right.

The lazy river is calling me. All right, Ben. Enjoy. Thank you very much for taking time away from your family vacation. Listen, I needed a break from my thing. You could thank Ben by filling out the survey. All right. Animal spirits at the compound news.

Personal emails. Personal responses. If you emailed us before, you know what I'm talking about. Thank you, everybody. Thank you, Duncan, and the rest of the team for producing this as always. We will see you next week. Oh, wait. Happy Thanksgiving.

Okay. Yes. Happy Thanksgiving. This is a great time of year to be with your family. Go lions. To watch the Giants. I can watch the Giants here, too. To watch the Giants gets destroyed.

And I'll say this out loud, Ben. Oh, the Giants are playing too. I'll say this out loud. My highest conviction bed of the year. Okay. Money Lion, Lions, Moneyline Cowboys. It's minus 1.30. So there's a bit of a Vig.

If this doesn't work. I'm putting multiple units on this. If this doesn't work, I'm going to hang my cleats up for this season. How about that? Just be careful. The lions have been known to blow games on Thanksgiving, but fingers crossed. We're a new team. The Bears are not going to score more points on the Lions,

and I'm pretty sure that's how football works. All right. See you next time.