Animal Spirits Podcast - The Most Bullish Backdrop (EP.380)

Episode Date: October 2, 2024

On episode 380 of Animal Spirits, Michael Batnick and Ben Carlson discuss: the biggest risk to the real estate market, why bull markets are different today, gold & stocks both hitting ATHs, the US economy is sitting pretty, wearable AI glasses, bullish housing demographics, Michael's favorite horror movies, and much more! This episode is sponsored by YCharts and Fabric by Gerber Life. Get 20% off your initial YCharts Professional subscription when you start your free trial through Animal Spirits (new customers only). Sign up at: https://go.ycharts.com/animal-spirits Join the thousands of parents who trust Fabric to protect their family. Apply today in just minutes at https://meetfabric.com/spirits. Sign up for The Compound newsletter and never miss out: thecompoundnews.com/subscribe Find complete show notes on our blogs: Ben Carlson’s A Wealth of Common Sense Michael Batnick’s The Irrelevant Investor Check out the latest in financial blogger fashion at The Compound shop: https://www.idontshop.com Feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation.   Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Ben Carlson are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. The Compound Media, Incorporated, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. For additional advertisement disclaimers see here https://ritholtzwealth.com/advertising-disclaimers. Investments in securities involve the risk of loss. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. The information provided on this website (including any information that may be accessed through this website) is not directed at any investor or category of investors and is provided solely as general information. Obviously nothing on this channel should be considered as personalized financial advice or a solicitation to buy or sell any securities. See our disclosures here: https://ritholtzwealth.com/podcast-youtube-disclosures/ Learn more about your ad choices. Visit megaphone.fm/adchoices

On today's animal spirits, Ben and I talk about why Tom Lee went so viral over the weekend. Someone asked Michael and I why we lease cars instead of buy them, even though personal finance people say that's a no-no. Spoiler, it's fun. We talk about the most bullish backdrop for equities, and it's not just me saying it. The economist from Moody's will corroborate my story. I tell a story about being a homeowner with a roof leak, and the guy told me $500. is basically free, and I thought that's a very good way to put the inflationary period that we just lived through.

And finally, I've got this question before, and I never went through the exercise, but so thank you for the most recent email. It's October. It's Halloween. It's horror month. What are Michael's favorite horror movies? Stick around and find out. Today's Animal Spirits is brought to you by our friends at Y charts.

We're in a rate-cutting season now. Not fall season, not October. What is the Pumpkin Spice season? It's rate cutting season, it's pumpkin spice season, it's quarter zip season. That's true. I didn't get the memo. So Whitecharts has a new white paper out that looks at asset class performance when inflation is going lower. So disinflation, which is the kind of period that we're in.

So you can receive your free copy. It's great. Link in the show notes. Don't forget, if you haven't subscribed yet, do so. Tell Minil Spirits sent you 20% off that initial subscription. Today's show is brought to you by Fabric by Gerber Life. Ben, Fabric is term and life insurance so you can get done on the internet right here right now. No health exam. I'm in the best shape of my life, so I'd be fine either way. Your health is more volatile than the stock market

because I feel like two weeks ago you say you're in the worst shape of your life. Did I say that? Okay. That actually is close to the truth and best shape of my life. I have an announcement later on the show about my health, but back to Fabric. Very easy to do. You can do it on the website. You can do it on their app. Meet the thousands of parents who trust Fabric to help protect their family. Apply in just minutes at meetfabric.com slash spirits. That's M-E-T-Fabric.com slash spirits. Policies issued by Western Southern Life Assurance Company, not available in certain states. Price is subject to underwriting and health questions. Welcome to Animal Spirits, a show about markets, life, and investing. Join Michael Baton, and Ben Carlson as they talk about what they're reading, writing, and watching. All opinions expressed by Michael and Ben are solely their own opinion and do not reflect the opinion of Ridholt's wealth management. This podcast is for informational purposes only and should

not be relied upon for any investment decisions. Clients of Ridholt's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. It is Tuesday morning. We're recording the show at this time as we always do. And the latest news over the weekend was this horrible horrible Hurricane Helene, which I guess came up through Florida and went along the East Coast and did an enormous amount of damage to a lot of places, but specifically Asheville, North Carolina, which is, I don't know much about that space. As the chocolate night person would say, I'm geographically challenged. But I do know from what I've heard that this is a place that was never in a million

years thought that they can get this type of damage in rainfall. I heard it was 30 inches. So I mean, the city is in really, really bad shape. It's an awesome city. I went there before. My brother used to open the south. A lot of fun, live music, all that stuff, good breweries. And the pictures are just, I can't even imagine the looking at the businesses and the houses and how impact of those people are. I don't know how you pick up your life and start over again, essentially. Yeah. I was listening to The Daily this morning and they were talking

about the devastation. It's hard to imagine many things worse than watching your house just get wiped off the map. Like all your possessions. There was literally a video of a house floating down the river basically. I can't even imagine what you would go

through. So Axios had this piece this week. talking about how Zillow is now adding climate change and insurance risks to their listings. So this says, mindful of increasing risks from extreme weather events such as hurricane, Zillow will combine climate risk scores, interactive maps, and insurance information on its home listings, the company announced this morning. So they're going to have risks on floods and wildfires and high winds and extreme heat and poor air quality. And they're saying that like climate risks are now a factor for a lot of people when buying a home.

But the thing is, like, this was not on anybody's radar. The idea that this city can get 30 inches of rain in the mountains was unfathomable, unthinkable. And with the climate insurance, what if somebody opts out? You know what I mean? Like, somebody ups in, somebody opts out. So what? If you pay for it, you're good. And if you didn't, you're totally screwed.

Like this, the answer to this, and I know some people don't like this, it has to be the government. So, okay. There has to be a governmental solution. So this was a story from three days ago. Florida Congressman is advocating for the creation of a national catastrophic insurance fund to spread the high cost of home insurance claims by major storms. He said it'll add no money the deficit. It will allow states to buy bonds that when we have these one-in-one-year events,

which seem to happen every year now, even though the first thousand-year events, would take that off the plate of insurance companies. He said, I think we have to amortize the risk. We have to spread this risk around. It can't be just on one or two states to deal with this. See, I mentioned this before, and a lot of people said, no way. There has to be a national bipartisan solution because when politics gets involved and it's no, we're rescuing your states are, your city can go f*** itself. We can't live like that as a country.

I agree. But do you think people are going to be okay saying, and this is saying, we're not going to save your million dollar beach house in Florida because you decided to live as close to a hurricane alley as you could? I get it. I get it. But no, I agree. There's no other solution. Yeah. Because insurance costs are just going to continue to go through the roof, and it's going to have to be the government. I guess I would say that there are going to be some people that probably should not be, I hesitate to you the words, to use the word bailed out, but I don't know what else is how to describe it.

But I'd rather some people get away with, you know, whatever unfair treatment to their benefit than innocent people get screwed. Yeah. But, I mean, this is the way the United States works. There's states that bring in high tax revenue, and they feed. it to the states that don't bring it out. So that's how we do already amortize the risks in a lot of different ways. So they, in the same article, they said they average Florida insurance premium in 2023 is $11,000 a year. The national average is like $2,300. So people are already paying more on costs, but it's probably not enough. No, it's not. We spoke. Kyle,

Kyle did a piece on this a couple of weeks that we were talking about this. I mean, the thing is nobody, it's nobody's problem until it's our problem. That a lot of people that had been against this sort of relief, when it happens to their city, all of the sudden, come asking for it. And of course. Everybody, there's got to be a way to cover everybody. But I think, I think, I guess there's a difference between relief for a city in FEMA and all these different places and like putting your house, living in a place that's in harm's way. I don't know what the, the right tradeoff is going to be. Okay, but I agree. But was Asheville in harm's away?

Yeah, I know. I, listen, I totally agree with you. I'm just saying consumers are going to be spending more in home insurance and the government is probably going to have to help too. I think it's going to be both of those things in the years ahead. Yeah, so maybe it's unfair. Maybe it'll leave a bad taste of your mouth that you're paying more to subsidize other people. But that's sort of the way this country works in many respects. But the other problem is these insurance companies are not going to sit there and eat losses. They're going to pull out.

They're going to say someone else can do it. Yeah. We're not dealing with this. Government is not the solution for every problem, but for something of this magnitude, you know, it's got to be. Yes. I really am curious to see part of me has been saying Michigan is a climate hedge. tongue-in-cheek for, but I have believed it. I wonder what the migration patterns are going to be in the years ahead

if this stuff keeps happening because it doesn't seem like it's slowing down. But the west coast of Florida got pummeled as well. Right, and which it has a few times, obviously. So I'm curious to see the migration patterns of people that actually view this as a risk and change where they're going to live because of it. Anyway, just the whole thing is tragic. Yeah, again, I can't even imagine how disrupted your life are. And it's one of those things that puts you over.

your minimal problems that you have into context and perspective, right? You would hope. All right, let's get on a good topic. So Josh and I had Tom Lee on the compound and friends on

on Friday. And his video went mega viral. Five days later, we've got or he's got 182,000 views. And I say this not to pet ourselves in the back, because it has a lot more to do with Tom than it does with us.

But that's, Tom's what I want to talk about. We spend so much time, you and I and a lot of other people, bemoaning the fact that Dumer has got all of the attention, that bad news travels around the world before good news can put its pants on or something like that. You see one of these Permabair YouTube channels that has like a million followers and you go, how is that possible? Yeah, yeah. And Tom is a great counter example to the fact that maybe there is, not maybe, there is clearly

a demand for people like Tom that are optimistic with data, not blindly optimistic, and right, what a wild concept. And so I just wanted to point out that it's really a breath of fresh air to see somebody who's not all doom and gloom. Yeah, so guys, glasses have full. Have such a large audience and people really loving it. And really nice guy too, right? Great guy, yeah.

And the thing is, it's not like he's like a psychotic permable who just tries to twist everything that end of being positive, he backs up with data in historical analogies. Yeah, there are other people that are wildly optimistic without landish forecast, not naming names, and they get discarded, as they should. Right. Yes. All right, I want to talk about bull and bear markets.

So last week on this show, I said, this is kind of tracking to be like the 1980s and 90s. And then I put Chart Kid Matt and said, do this for me. I've never done it. So he went from the bottom of 1982, which was essentially when, after we had those two recessions, like back to back,

and Volcker finally said, we think inflation is kicked, and then that's when the bull market took off. And if you look just at the lines for a total return basis, we're an AI bubble away from basically reenacting that 82 to 99 bull market. So you and Josh and I got into a little semantics argument yesterday about what constitutes a bull and bear market. And Josh said, well, maybe the bull market starts in 2013 when we break out the new highs.

And I think the problem is, and this is, splitting hairs here, we've never had a bull market that started at the bottom of a bear market before, or like a crash. Every, so we had the 1920s roaring, you know, roaring 20s, we had the 1929 crash. The bottom was in 1932, but the bull market didn't start again until like World War 2. So you had this sideways period for like 10 years. Then you had a 25-year bull market from World War II to the mid-60s or whatever, right? And then from the mid-60s to early 1980s, you had another sideways market. But the bottom was in 1974.

This is the first bull market that's ever started from the bottom of a crash. And so I think... In terms of what measurement? Like how people talk about it? Yeah, because you could say, well, why wouldn't you start the bull market for the 80s and 90s in 1974

when stocks bottom? Because it took... You still worked off a lot of sideways action there until 1982 things took off. So I don't know if you ever read this book. It's called The Little Book of Sideways Markets and Alson. It came out in 2011.

And I read it. And he looked at all these historical analogies and said, listen, coming out of the 2008 crisis, if we follow the same script, you're going to have a period of like seven to ten years where you're going to work off the excess valuations and valuations are going to get very low, and then the bottom hits, because that's what's happened historically. And I read it at the time I'm thinking, this makes a lot of sense. The historical analogies are there. This is what happened in previous secular bull and bare markets. And then it didn't.

And I think that's because the Fed and the government's assistance has changed things. I don't think we're going to have those periods of working off the excess, working off the excess, then go. So you think the idea of... I think it's just like a... The V is...

We didn't have the Vs in the past. The Vs are there now. So I think the V's... These are different. The recoveries are different. Yes. Because the government steps in with the bazooka with monetary and fiscal policy

during those really terrible financial crises and they didn't really do that in the past. Yeah, I think that's fair. Kind of semantics, but that's where I've landed. All right. I feel like so many scenarios now, you could say, like, if I told you this five years ago, you wouldn't have believed it.

This one is, I don't know what the explanation for this one is, but gold and the S&P 500 are both at all-time highs right now, or around there. It's kind of a weird, because usually it's one or the other, right? You see the chart here? They kind of tend to flip-flop and go in different directions, and there's the correlation thing. But what's the explanation for why gold and the S&P are both breaking out to new all-time highs? And gold did it during a hiking cycle when the relationship is supposed to be,

higher real interest rates is bad for gold. Yeah, I don't know. We're just so rich. We have so much money, money. There's too much money and not enough assets. There's a scarcity of places to put your money. Is that absurd? I feel like that's a very smart talking point.

I don't know if it's evidence-based. Thank you. And I've heard people say that. There's a scarcity of assets, but is it true? I don't know. I don't know. How do you prove it? I don't know.

The stock market's worth like $50 trillion. So it seems like... Well, you could show that real wealth is at an all-time high. True. Yes. I'm just saying to me it's kind of surprising that they're both at all-time highs

it doesn't seem to make sense but here we are. Yeah. Not complaining. All right. China and emerging markets are ripping. Check out the year-to-date chart I put in here for Vanguard Emerging Markets Fund

and the China ETF, the MSCI China, just took off in the last week. And China is now outperforming ESMP on a year. Yeah. So I've always thought, like, China can get stuff to happen with a snap of a finger, essentially.

And I've always wondered, can they get their stock market to go up if they want? No, no, no, no. No, they've tried things like this in the past over the last. But I don't think they've followed through. So, and because I hear a lot of people... I don't buy that. If they could make their stock market go up, why wouldn't they? I mean, that's, come on.

It's ridiculous. Remember a few years ago? They essentially were like, listen, we don't want these tech stocks in China to be as big as powerful as the U.S. And they kind of slapped the wrists. And Jack Ma, like, went away for six months or whatever. Yeah, they could destroy things. It doesn't mean they can make the market go up.

They're not like, God. But they can't make it go up. But do you think that they could put enough reforms in where they say, we want the stock market to matter? They're trying. And so to your point is I've heard a lot of people poo-poo they're saying, no, no, no, no, they've tried this in the past. It's not going to work this time.

My point is, what if they do try to do like Japan did and say, let's make things more shareholder-friendly, let's really push the stock market and try to build stock market wealth in this country because real estate is obviously not working for us. I think that's an upside risk that not a lot of people are considering, especially considering how cheap stocks are abroad. Yeah, it's an upside risk to the entire global economy and stock markets around the world.

Yes. I agree with the sentiment. People keep saying, well, they've done this before and it didn't work. But I'm just saying one of these times they could just say, you know what, we need this now, and we're going to keep pushing it. We're going to make it easier. And I think it could be a real thing. I think they have the ability to snap their fingers and make the stock.

market go up. Then why haven't they in the past? They tried. They didn't want to. They don't want to be like the U.S. They've tried reforms in the past to make the stock market go up that have fizzled out. I don't think it's that simple. Maybe they're doing more this time, but why wouldn't they want their stock market to work? I just think they have so many resources. I think they can if they want to. I think there's a lot of ways for them to attract capital if they really decided the stock market is going to be our number one goal now. I don't think they've wanted that in the past. They didn't want to be like the US. Maybe. I don't know anything about Chinese culture, really, so. All right. I want to quote you to you. Thank you. It's hard to imagine a better macro backdrop

for equities. And then you said, I can't believe I'm saying this. Still listen to my face later. Blah, blah, blah. I'm not afraid to be wrong. No, it's, so listen to this from Mark Zandi. Who's he the chief economist for? Moody's? There you go. Is that, is they? I think you're right Yeah, Moody's analytics, okay I've hesitated to say this

at the risk of sounding hyperbolic But with last week's big GDP revisions There's no denying it This is among the best performing economies In my 35 plus years In an economist Economic growth is rip roaring While GDP is up 3% over the past year

Unemployment is low at nearly 4% Consistent with full employment inflation is fast closing on the Fed's 2% target Grocer prices, rents and gas prices are flat to down over the past More than a year Household financial obligations are light and set to get lighter with the Fed cutting rates.

House prices have never been higher. Most homeowners have more equity in their homes than ever. Corporate profits are robust, and the stock market is hitting a record high in a seemingly daily basis. Of course, our blemishes is lower-income households are struggling financially. There's severe shortage of affordable homes,

and the government is running large budget deficits. And things could change quickly. There are plenty of threats. But in my time as the economist, the economy is rarely looked better. I told you, I got a degree from economics. He said it way longer than you did. You said it in one sentence.

He said it. much lower. Listen, this is not what, the way that I'm, the way that I'm describing the state of the economy, it is nothing, it's not a prediction. No, it's not a forecast. Based on the data, yeah, based on the data right now, things look great. These are the facts today. It doesn't mean that this will always be the case, but for now, could you poke holes?

Like, could you Grand Rapids hedge it? Of course you can. You always can. But the facts are the facts, Jack. And right now, things look pretty good, except for that next trade, if things look pretty good. I'm bullish on that trade, actually. I think you're going to be happy with that in the long term. I hope so.

Torson Slocke also said, so he shows real GDP by quarter. And the latest one is 3%. The GDP now for Atlanta Fed is showing another 3% for the current quarter. He said it's difficult to argue that the U.S. economy is slowing down. I guess you could argue the labor market, but as far as growth goes. Can I give another analogy for why stocks are more expensive than they used to be? And this is a drum that I've been banking, not to brag, for, a long time now.

I wrote a post maybe in 2015, like, why stocks should be worth more today than they used to in the past. I can't remember what the title was. But it was based on the fact that valuations have been rising over time since the early 1980s. Last night, I was on the way to a movie, movie theater, maybe you've heard of it. And I took my wife's car because it's a loner. And I wanted to check it out.

We got the... Still having some audio issues, huh? It's been in the shop for like six weeks. Robin goes, should I call them? Said, no. Who cares? Fix our engine, damn it. Drive that loaner into the ground.

Until then, we'll put miles on the loaner. So my wife's car is from 2019. I drive a cheap wrangler. As you probably know, they don't drive very well. Not the most pleasant driving experience. So I'm driving this brand new, I guess this is a 2024 out of Q5. And I'm on the highway, the Southern State Parkway for those from my fellow upper class Long Islanders.

This is a- Lean into it. This is a highway that twists and it turns. And I'm driving and the steering wheel is moving for me, like actually, to the point where I have my hands on my lap. Look at me at King of the Castle. And it's just going. Now, eventually, it says, put your hands on the steering wheel. Yes.

My wife says that too. But I call my wife, I'm like, this is incredible. Holy shit, what a smooth sailing vehicle this is. Like, forget about the electronics of it, but just the way that it drives compared to the Wrangler. So anyway, we know that cars are more expensive than they used to be. But when you adjust for quality over time, cars are what? 4,000% better. Just the Apple Car play.

interface that you get on every car now, right? Yeah, should cars not be wildly more expensive than they used to be? A car that used to cost $20,000, even adjusted for inflation, should probably cost $70,000. They're so much better. So the moral of the story is you're going to call your car broker today and say, I want a Q5. Well, I told you. Get rid of the death rat's Jeep. I still identify as a middle classman, okay?

I don't need this luxury vehicle. I love my $560 monthly car payment. Thank you very much. But my point is, bringing it back to the stock market. Apple is to the 2024 out of Q5 as IBM in the 90s, with all due respect, to my Jeep Wrangler, hunk of junk. That's a good analogy. I agree.

Thank you. Yes. Very well said. So we're paying up because the product is better. And you want to know the other reason? We've cut off the left tail, the severe left tail. That, that, that, that, that, no, no, no. The severe left, the Great Depression left tail.

has been cut off, right? That 85% crash in U.S. stocks, that would never happen anymore. So I know that there are people hearing this and say, never say never. All right, you know what? We could say never. 99.9%. Yeah. All right. I never would have believed this in 2020 as well. So real GDP has outpaced the pre-COVID projection. It's 2.3% above the pre-COVID projection based on trends. Like if we would have followed that historical trend. Real wages as well. So the real wages of non-managerial workers, that's 80% of the private workforce, right, are above the pre-pendemic levels and higher than expected based on pre-pandemic trends. So it was actually the managerial workers who saw slower wage growth than the pandemic, that are below trend.

But 80% of workers are seeing wages that are above where we thought they would have been had the pandemic never happened. Where does this data come from? Like, literally. How do they know who's managerial? I mean, it's reported, I would imagine. Yeah, but who? I mean, I know you don't know. I'm not putting you on the spot. I definitely don't know.

They do surveys on this. That's how they get the data. Are you a manager? Yeah. Huh? I guess. Speak to the manager, please. And then that's how they get.

Uh, bad. So remember the technical recession we had where GDP was down two quarters in a row and people said, hey, that was a recession. You can't, that was it. Right? Well, I remember very. Well, you and I say, NBER never said it's two quarters.

They never said it. The unemployment rate kept going down. So it was not, but this is why you don't just use GDP to factor in the economy. So Ben Casplan says, revised data shows that the GDP rose in the second quarter of 2022. So now it did not fall two quarters in a row anymore. What about the revision to the revision?

Yeah, if it goes back down then, then the recession was back on. All right, I want to get back into the rich, the rich versus wealthy thing we talked about a few weeks ago. He's another tors and slok one. Are you still using Stitch Fix?

I do. So I get it once every other month. Where'd you get that shirt? It's interesting. That doesn't sound very complimentary. No. I don't dislike it. How do you say it like the madras or whatever? I have no idea. What's a madras? I don't know.

By the way. Probably like a J. Crew shirt. I don't know. Speaking, what do you mean? You know exactly with it. That's a J. Crew shirt. It's probably J. Crew. What? You didn't buy that J. Crew? Did the store say probably J. Crew when you walked in? Yeah. You know, I never really understood. Jay Crewe, middle class.

That's true. That's middle class. It's upper middle. It's upper middle. I never appreciated how ridiculous the English language was. And apparently how poor I am at speaking it until this podcast. Last week when I got confused at the term thumb your nose, I was like, is that a thing? Because when you're just talking, you don't think about what you're saying.

But when you're talking to it, Mike, you got to speak, this pressure. Thumb your nose, what the fuck does that mean? thumb your nose, grain of salt. Did you look it up? Exactly. Why should you have to look up a phrase? We should have phrases that make sense. Blame Shakespeare. 80% of those phrases came from Shakespeare.

Like every phrase like that is traced back to Shakespeare. All right. U.S. income and expenditure by quintile. And he shows the spending and the income percentages broken up by each 20%, right? And the highest income quintile, the highest 20%, what is this looking at? I don't get it.

So it's percentage of income. So they break people out into these groups. How much do they have an income and how much do they have spending? So the highest 20% of people spend 40% of the money on expenditures. This is our rich versus wealthy talk from a few weeks ago. Oh, the blue and the green each separately end up to 100. I got it, I got it. This is a pie chart.

There's a pie chart in bar form. Okay, weird. Yes, there you go. Okay. As a connoisseur of pie charts, that's why you didn't get it. Yeah, this. But my whole point is that higher income people spend a lot more money, and that's where the feeling of rich comes from

and the feeling of being left out if you're not in that group. We can't stop spending money. You know what I saw on Instagram the other day? A thing that opens eggs, a thing that cracks eggs. And I got it beyond. honest, I'm probably going to buy it. As somebody that breaks, and you probably break a ton of eggs, do your kids eat hard-boiled eggs? My kids love hard-boiled eggs. And I, for the life of me, I throw them in the tub of freezing cold water when they're done. I was told that's the way to peel them cleanly.

I can't peel a clean egg. And then cracking the egg, I cracked it the other day. I tried cracking it with a knife that splattered everywhere. So there's a little plastic thing on Instagram where you put the egg in into an individual, it just cracks it right open. But my point is, we're a nation of spenders. We can't stop. There's something for everything. My daughter likes over-easy eggs lately. There's not an easy way to make over-easy eggs.

It's very hard to do. Okay. I can make an over-easy egg. I've become quite the chef. Let me tell you. What's the secret? Do you put like butter down first or oil? Because you've got to get it very, very slippery.

You got to use low flame. Low-fling. Okay, slow burn. Kind of like a marshmallow if you want that golden brown. Right. So speaking of spending, I was going to talk about this later. We had a little, we have a screened in porch. And we got it redone because it was just screen. And so every spring, it would be full of pollen. Is this at your primary residence? Yes. And so it's full of pollen. And I wanted, I'm like, I want this still to be a screen in porch room, but I want to be able to close off the screens a little bit. So we got this new. Back your house. Back your house. Yep. So we got a lot of like woods in the back. And so again, everything is just covered in pollen. And it was, it defeated the purpose. Oh, we got a lot of woods. Big woods guy.

Yeah. Big woods guy. So I'm constantly wiping it down. So we got this new thing where it's kind of like half screen, but it also has these like window things that open. Okay? Makes sense? Kind of like plastic.

Yeah, it kind of opens. And so we got that done and we got it all new couch in there. And we put a nice rug down. And then big rainstorm and there's a leak in the roof. How is this possible? The house isn't at old. So I had a roofing company come yesterday. Yeah, it's just a something joint, like I,

know what he's talking about. And he's like, listen, you could spend thousands of dollars getting in there and really figuring out the problem is, or we can replace this joint, we can hammer a few nails, and 500 bucks. He goes, 500 bucks is basically free these days, right? He said that? Yes. And I'm like, yeah, let's do it.

That mentality, though, is like, we've got 500 bucks. He's like, that's basically free. Wow. Yes. And this is in Michigan. Yes. No offense. Right.

I mean, whatever, they're getting up on the ladder. They're getting on the roof. They're taking a little risk, but I bet it'll take them 15 minutes to do it. But yeah, that whole thing got me thinking that when we do have the renovation boom, if rates get back to 5% or whatever and people start borrowing their equity, I think there's going to be still some sticker shock of people going, whoa, I can't believe it costs that much to redo this kitchen or bathroom or bedroom or whatever. And then they're going to do it anyway.

Yes, then they're going to say, eh, you know what, fine. From Vanguard, they did a study. I like how Vanguard, they do this every time there's a huge spike in volatility. They show what their investors actually did. Panicked. Volatility in the U.S. stock market hit a four-year high on August 5th

when the Standard & Poor's 500x drop down near 3%. I feel like when you call it Standard & Poor's instead of S&P, that's like the announcers that say National Football League instead of NFL, right? The National Football League. Anyway. Speaking of, thank you to the Lions because I bet on Jemir Gibbs, Mr. Williams and Mr. Montgomery to each have touchdowns.

And so that I've been in a hole. We're going to get to that later. Who would have bet that gold is at all-time highs, the S&P is at all-time highs, and the Lions have the most fun team in the NFL right now? Yeah. Right? Do they have the best offense in the NFL?

Yes, they do. They do. So more than 97% of Vanguard retail investors held steady, placing no trade. This is the day of the Japan blow up. Of the 2.5% of investors who traded on August 5th, net buyers of equities outnumbered net sellers, by more than four to one.

So the people that did, no one traded basically, but the people that did trade got in there to buy. I don't see what stops this, this type of behavior lien. This has been learned over 15 years. And the dumbasses will say, just to wait, just wait, one day. Okay.

Everyone's going to rush for the exits. Yeah, no, no, stop. Nobody's rushing for the exits, okay? Now, I'm not an idiot. it. Bare markets happen. I'm not saying just because people won't rush for the exit that we can't get a 40% drawdown or 40% crash for that matter. 40% is not a drawdown. It's a big one. We can and we probably will. We just had a bear market long ago. But there's not going to be this day where all of the sudden people stop contributing to their 401 keys, where all

of the sudden everybody dumps their index funds. If it takes 15 years to learn this behavior, how long does it take to unlearn it? I don't know. We just had a two-year bare market. Did that stop it? Would it take 10 years? I really don't know. But there's not going to be this day of reckoning where everybody rushes for the exits.

If that's your fantasy, well, A, you're an asshole, but B, just stop. Well said. Yeah, I don't see what stops it. All right. I'm a big proponent of asset allocation quilts, right? The colors, it's just, it tells a good story. Eric Soda tweeted this out. He did S&P 500 sector performance in this asset.

quilt style by presidential term. So he did all the way back to Bush senior. Bush senior, Clinton, Bush Jr., Obama, Trump, and Biden. And he breaks it out by sector. And there is no rhyme or reason here in terms of, the funniest thing is that the best performer for Biden is energy. Because typically you think, and guess what the worst performer was for Trump? Energy. You would assume energy is going to do better under Republicans. And the whole point is there's really no rhyme or reason here in terms of the best performing sector for each president. And then he also looks at asset class returns by president. Again, same thing, all over the map.

There's no rhyme or reason here. There's no, this president, because they're in this party, is going to help this sector more than any other. No rhyme or reason. I think that our audience is well aware of the fact that this is not any way to invest. But I do think the people that are not listening to the show, a lot of people still believe that politics, who is in the White House, I won't say it matters, because it does matter, that it's actionable, that you can, like,

right, you know, have a better outcome based on who you think might win. And of course, that's nonsense. Ben, you don't like politics? I just want to talk for a minute on how much I hate it. So I thought this was one of my, this passage from the book Tribe by Sebastian Younger. I don't know if you read it. It's like a 150-page book. It was really, really good. Yeah. And this passage stuck out to me. The United States is so powerful that the only country capable of destroying her might be the United States herself, which means that the ultimate terrorist strategy would just be

to leave the country alone. That way, America's ugliest partisan tendencies could emerge unimpeded by the unifying effects of war. I don't think that there's any way to unify the fractions anymore. My team's over here, your team's over here. And I just hate it. I hate it, too. Unfortunately, uh...

Tragedy brings us together. But the thing is, the pandemic should have brought us together. And all it did was, and it didn't. I don't know what could happen these days that would cause the country to come together. Not that I want to have that kind of situation. But I think his whole thing about, again, you can always look for the bad side of things and say that this is bad and that's bad. But things right now are as good as they've ever been in history.

There's never been a better time to be alive than right now this instance. but because things are so good it's never been easier to complain about the things that are bad. Oh, yeah. Jonathan Haidt wrote a book Hold on a second. Basically, the whole book was about this,

I believe, I'm getting the book right. Oh, the coddling of the American mind. Was that it? Yeah, yeah, the coddling of the American mind. That was part, I think that's part of the message of the book. But yes, things are so good that we have so much time to complain. Yes, unfortunately.

There was an article of the, you know, speaking about politics, which is obviously ramping up. Netflix cancellations spiked. They have to read Hastings donated to Kamala Harris. Can you imagine? We're not political people. But can you imagine canceling Netflix based on who the former CEO is endorsing? Especially with season two of Squid Game coming out soon. I have no interest in that, by the way.

As much as I love the first one. You think it's a one and done? I don't know. I mean, if it's good, I'll watch it all. I'm just going to wait. I'm not going to, I'm out of day one view. That's all. All right.

If you watch what it was just as good, all right, I'm in. I'm just, I'm waiting and sing. Somebody tweeted last night, there was a video of an older guy who bought a Taylor Swift guitar for $4,000 at a live auction. And when he won, he went up there with a hammer and destroyed the guitar. because she's not voted for Trump. Yeah. Oh.

And that's a guy who probably complains about the price of eggs. Yes. That was the tweet. That'll show them. Yeah. Unbelievable. So Mark Zuckerberg says that wearables and the AI glasses are going to replace the iPhone. And when he says replace, he says, listen, the mobile phone did not replace the desktop.

We still have desktop computers and laptops. But the mobile phone takes precedent now. Right? You can sit at your desktop and still do stuff on your phone. He says that's what these glasses are going to do. You saw a picture of them, right? Like the Drew Carey glasses. I'm all in on this idea.

I got to get one. I'm shorting this. This is my highest conviction short. There's no way that these wearables and glasses are going to be bigger than phones. I'm sorry. There's no way. I think this is a terrible call by him. I'm shorting this on leverage.

I'd be careful. Be careful with this short. Remember Vision Pro? But this is not the Vision Pro. How did the Vision Pro go? People don't want to wear clunky stuff on their face. This is not clunky. These are glasses.

I'm sure the mistake. I think the glasses are going to be enormous. I don't know if it's going to be in like 10 years, but I think that the glasses, it's going to be like the Iron Man shit. How many people want that? I do. All right.

You bought a Vision Pro. I was so worried about the Vision Pro that people are going to become hermits. and it sounds like no one bought it. I know this stuff, I know this stuff is going to get better. It's apples and oranges. This is not the Vision Pro. These are glasses.

The Vision Pro are goggles that turns the world off. Nobody wants that. All right. I don't want to live in a video game all day on my face. Yeah, you're old. I'm shorting this. Sorry, I'm shorting this. There's no way these are bigger, bigger than the phones.

Bigger than a smart phone. I'm not saying that. That sounds like a lot. I don't know. I guess I would take Mark Zuckerberg's take on technology over you, again, with all the respect. He stole it from the Winkle boss twins. All right, the average month of the mortgage payment for a new buyer of $500,000 on the house is the company court. This guy literally changed the name of his company to meta and plowed money into the metaverse in 2021.

Yeah, we're going to trust him. It's not a matter of trusting him. I just think he's, all right, listen. You know, credit to him, though, I do call the company meta now. He's not bad. No, I will never call him out. It's always Facebook to me. Okay.

You're going to be the one. I'm not a narc, so I don't call Twitter X either. If you call Twitter X, you're a narc. Yeah, that is, yeah. Right? So anyway, the average home payment is declining. That's good news. Based on median home price and...

I think it's probably more function of mortgage rates. You saw mortgage rates ticked up a little in the last week, though? Did they? Son of a bitch. Yeah, it's going to take some time. I just, I put out a piece the other day saying, I think the Fed should try to narrow that spread. But what narrows that spread?

What would cause bond buyers to step in and narrow that spread? Well, the Fed buying mortgage bonds. That's it. Do you think it would narrow substantially, though, if Powell just said, if it doesn't narrow, we will step in? Do you think that would be enough to do it? Yes. All he has to do is say, listen, if this spread doesn't get back to historical norms,

which is like, I don't know, 50 or 75 basis points, they would come down just to get back to historical norms. He would be telling the market, hey, buy these bonds before. before we do. Yes. I think that's what he should do. And then the Fed doesn't have to do anything. And the spread comes in and mortgage rates fall. All right. Morgan News on the housing market. Redfin reports asking rents for new apartments drop 6% to the lowest level since 2022. Take it. And they talk about because so many buildings have been finished. So, but this kind of makes me think in two or three years, we're going to be seeing the opposite of this. Because

they've built so many apartments, but now all that construction has slowed to a halt because rates went higher. Yeah. So there's going to be a low period now until rates get lower again. Good news, though. I'll take it. All right. Eric Finnegan, we talked about him last week on last week's show, and he said, hey, guys.

Appreciate the shout out. Here is our new demographic book. I thought it was really well done. A whole presentation on demographics. We've talked a little bit about this. I know you're going into your Simon & Garland. uncle right now because you hate demographics. It is funny how that, that, like, classic song is just now thought of as someone going

off to La La Land. You know, I saw Paul Simon with my dad, I think my dad, his last concert at Forest Hill Stadium. What a grump that guy is. Oh, really? It's his hometown. He didn't say a fucking word. I always do find that weird when artists just play the show and don't interact with the audience at all.

don't say anything. It's very bizarre. That's how he was. He's a grouch, yeah. Okay. Also, one other thing. Do you think, so third eye blind, going back to concerts. I don't know what year semi-traum kind of life came out.

And then we're going to sing, do, do, do, do, do, do, do. Do you think the band members are like, that's dumb? No, but do you think that, so they haven't had a new hit in 20 years or something, do you think they go, we got to play this again? Or do you think they're like, yeah, this is our, this is our cash. we got to play it. Do you think they get sick of it? Yes.

And yes to both. Yeah. They have to, right? Because they came out and played a couple of songs that we'd never heard before. And they looked like they were having fun playing them, but no one knew what they were. Yeah.

Oh, yeah. Remember early I was like, I'm about to start booing if they don't play their hits. Like, the whole concept of a one-hit wonder fascinates me. Because if I had a one-hit wonder, I would just make another song that sounded just like it. Just a little different.

Right? Like how they don't know. I stole David Bowies. It's different. That would at least have a two-hit wonder. All right. Largest population group turns 32 to 36 in 2024. So this is a cool chart showing the breakout by population. This is interesting. The population of typical entry level and first move-up buyers will grow in size by 6 million through 2040. So this is household formation. I think this is even more interesting. This is going from middle class to upper class, Michael. The second move-up and luxury buyer population will grow even more by 8 million through 2040.

So I think this is the next wave of, if it's not people who are renovating, it's, all right, it's time for us to move from that starter home that we bought pre-pendemic to now a McMansion or whatever it is. That wave of millennials, as they hit their 40s and 50s, I think is going to be huge. And they're going to have very high tastes, and that's the next, like, wave, I think, after the young people. Housing is in a secular bull market. It is. U.S. housing is underbuilding based on today's population growth. He said U.S. housing undersupply were grow by 200,000 homes per year if we continue building at the current level.

That's not good, right? Not good? Not good. We need to build more homes. All right. Story time. So I went to Boulder, Colorado last week to talk to a group of financial advisors. Beautiful, beautiful city. The only thought I had was why didn't I go to college here? Absolutely amazing. The Rockies.

I tried to jog the trails at the Rocky Mountains, and it was like a street to get to the trails was like a whole hill up. Like, I'm rising in the altitude, and it feels like there's a vice grip on my lungs. And slow and steady wins a race. I couldn't do it. Couldn't jog.

Anyway. So I'm going home, and I go to Clear, which Clear is a joke. Clear is never faster. Clear is always slower than the TSA Precheck, right? There's a lot of problem, so I use clear something we need to take a picture of license again, blah, blah, blah. I give the lady my license, and I'm at the Denver airport. And she says, oh, you live in Grand Rapids of Michigan.

We have relatives there. I would love to move there. I'm like, oh, why? Denver is one of those beautiful places I've ever seen. The weather's here great. It's sunny. I like it here. And she says, no, ever since the pandemic, there are so many people that have come here, and everything is more expensive,

and it's too expensive to live here, and there's too many people, and we lost this. the soul of this city. I want out. I feel like this is a common theme we're hearing in cool places. Remember when we went to Charleston? Same exact line of thinking. It's just funny to me that

so the combination of remote work in the pandemic, if you live in a cool area, guess what? Lots of people are going to flock there. Yeah. And you can't be mad that people want to live in a cool place like you.

So the whole charm of the really nice places is probably lost forever on a lot of them. Well, but it's also starting to unwind a little bit. Like Miami and Austin peaked a while back.

and people are starting to normalize population levels, I think. True. Not like Miami was a quaint place, but Austin is the kind of place that is, like places, I guess, like Austin and Nashville are way bigger than people probably ever could have imagined one or two decades ago. Anyway, I thought it was interesting.

All right. Poll from Duncan on the compound, 3.3 million, no, 5 million votes. 3.3,000 votes. Which is, that's a pretty good sample size. Do you live below within or above your means? Below is 52%. Way to go within 36% and above 12%. Are people lying?

What do you think? Would you think there should be more above? I think we have a pretty good finance-based audience, though. Yeah, I would say that's probably right. I would say that's probably right. But sticking on the theme of people lying on surveys. So Bob Elliott did a long thread on the consumer. confidence index and some shenanigans that are going on.

So I want to read something that Jim Bianca wrote about this particular thread that was so obvious to me once I read it. I'm sort of embarrassed that like a light bulb went off. So Jim says, so it's markets want to move on these reports, a quick TLDR about them. The conference board released its consumer confidence results yesterday. The University of Michigan Consumer Confidence Survey is out Friday. So these are two reports that should track each other, right? it's both, it's, it's, it's the same thing.

Right. The University of Michigan conducts a phone survey of 600 respondents. Michigan does not disclose its disconnect rate or the number of people who hang up. Political pollsters say their disconnect rate is about 95%. So to get to 600 answers, you have to call about 12,000 people. Wow. As noted on the chart, the conference board and the University of Michigan tracked each other with a nearly 100% correlation between 1992 and 2020.

But like so many things in the past COVID era, in the post-COVID era, excuse me, they have diverged. The conference board has been much more optimistic since 2020. It is not clear why this is the case. The conference board does not break down its results by political affiliation, which we know is the driving force behind these surveys. Bottom line, in 2012, I dubbed confidence surveys the world's most useless economic statistics. And he did. Jim was in the Washington Post because he linked to it. And the Washington Post talking about how surveys are bullshit.

13 years later, I have not found reasons to change this view. Confidence surveys tell you really nothing. We spent all of 2022 or 2023 wondering why there's such a disconnecting the vibes and the hard data. Because it's bullshit. People just lie on surveys. True. And the people that do answer surveys are probably not representative of the economy. Because who the fucking answers a survey?

Dumb question. Why don't, instead of calling these people, why don't they email people? click three boxes. Wouldn't it be, wouldn't you get a better response on email? I don't know. But Bob Elliott summed it up.

He said just the reality is that the surveys look like they have degraded in quality. Yeah, no shit. I agree. All right, Ben,

somebody sent us an article on credit card laws and we were talking about how they're able to charge high rates and what happens if there's a cap on rates, then they're going to stop

extending credit. So somebody sent us an article and I thought, you know what? I don't really feel like reading this article. Thank you for Sunday yet. I just don't feel like reading it. I dropped into chat, GBT, as summarize it, boom, four sentences. Everything

I need to know. So, my daughter's soccer coach, like if the girls aren't hustling, he's this British guy, thick, you know, British accent. He goes, you're being lazy. That's what I think of being used to. You're being lazy. I was like, can't read everything. So what's a TLDR then?

Chad GPD summed up for you, summed up for me. That I won't do. Okay. There was a ruling in 1978, a Supreme Court ruling that effectively allowed cities or states to do what they decided to do. All right. The Atlantic what an article on the threat of online gambling, which you and I spoke about. Yeah, I saw this article. We spoke about the source data.

Legalized sports gambling was a huge mistake is what the title of the article is. I've had a rough start to the NFL season. The Lions pulled me out of a hole. I'm still back to, I'm still back to trend. My trend is I lose five cents of every dollar that I bet. Problem is, the problem is, which sounds pretty good. Oh, okay, I bet $100, I only lose five. That's like a, that's like a pretty decent entertainment tax, right?

Problem is I'm approaching $100,000 in bets. So you're just constantly betting and re-betting and betting and betting and betting. Yeah, I'm betting and betting and betting. Yeah. So the problem is eventually, you know, I'm going to have to, I'm going to have to cut myself. off off at some point, right? Right, yes. Carely is 5% forever. The nobody's going to get absurd. At some point it would be like, wait, I lost how much money?

All right, but most people... You're paying the Vig basically. Yeah, but I... It's a good ratio. Yeah. But the good news is most people are responsible bettors. So I do wonder if... So they say, the rise of sports gambling has caused a wave of financial and family misery, familial misery, one that falls disproportionately on the most economically precarious household.

Now, that's a fairly dramatic comment, right? That paints sports gambling in a really negative light. That's like people saying the phrase is always that the lottery is a tax on the poor. So that's essentially what they're saying here. Yeah. However, since they say way later in the article, because this is what, you know, this is what the media is, since the U.S. Supreme Court struck down federal restrictions on sports betting in 2018, the market has grown.

I'm sorry. My bad. This is just a stat. So since 2018, Americans have wagered almost $400 billion online, which is, you know, that's a lot of money. Okay, this is what was buried deep in the article after they talk about how it's killing families. And again, they did use source data. But so here's what they say later in the article. The good news is that online sports betting appears to be relatively harmless for most customers.

Well, maybe that should be the headline. But no, of course not. The median gambler in the study deposited $136 over five years. there's a quote in here. A lot of people are getting entertained for very little cost. So are there people whose lives are being ruined

by gambling? No doubt. No doubt. And I feel obviously for those families that are affected by loved ones that are, you know,

have an illness or can't control their behavior, which is a real thing. And I hate, I really, I kind of want to punch myself in the face. I don't know. I have mixed feelings

I'm about to say. Like hand waving it away. Like, well, because I don't like the what aboutism. Alcohol. is 4,000 times more dangerous for the population? All right. So to your point, it's kind of like the lottery

where are some people spending too much in the lottery? Yes, but are 95% of the people just having fun and doing it as a dream? That's also true. Yeah, most people, so, okay. So I don't think those things are in conflict with each other. But what, let me ask you this. In 20 years, are we more likely to say,

why was sports betting ever illegal? Sort of like alcohol? or, is it going to be a bigger problem than I'm anticipating? And we're going to say, I can't believe we ever allowed sports gambling. Well, the problems will be amplified more than the... This is the thing that shocked me. It says tax revenue has been anemic with all 38 legal states combined, making only 500 million from it a quarter, less than alcohol, tobacco, or marijuana. So I thought the whole reason was all the states are doing this because they'll make a ton of money.

So here's my question. Besides Draft Kings and Fanduel and stuff, do you think that people making the most money on sports gambling are the podcast hosts? Oh, yeah. They're the ones who are making the most money on this, right? The podcast hosts who are reading the ads for these places? Yeah.

They're making bank. They're the only ones making money on this stuff. Anyway, Fandual, hit us up. Michael's awful bet of the week. Okay, Americans are racked amounts of credit card points. Inflation is eroding their value. That's from the Wall Street Journal. That's what I've been telling people.

Use your credit card points right away do not hoard them do not hoard them look at this chart the spending power of 50,000 card points adjusted for inflation. It looks like a dollar, right? Like everything else. Do not sit on your dollars or your points. And I don't even, I used to use them for trips and stuff. Sometimes that's okay. I just get the cash back. I use it for my travel. Okay. I just, I get the cash back. It's easy. I don't mind. All right. All right, Ben, they keep, they keep doing it. the entertainment is now for for people our age

as there's another reboot Robocop. Robocop TV series is officially in the works of prime video. Gotta be honest. I don't know why I just said got to be honest. I saw Robocop recently. I don't know if I was on a streamer. Holt's up.

Really good movie. The funniest part out of it is that the guy who played Robocop wasn't even like a big actor. I don't know who he was. You couldn't name the guy who played Robocop, right? Yeah, unfamiliar with his work. I mean, it was an okay movie.

I guess I'd... Robocop. It was pretty good. Ben, you ever notice that you order something on Amazon and it's at your door a few hours later? Has that happened to you yet? Yeah, same day delivery. It's wild. Pretty great.

So somebody tweeted, click to door speed of U.S. digital purchases in days. Amazon versus other retailers. So other retailers are at 5.2 days. Amazon is at 1.5 days. It's really incredible how quickly they're getting stuff out. That is pretty great. Another data point. Things are getting better.

Think about how much easier your life is getting stuff delivered to your door from Amazon. We get stuff delivered every single day and not having to go to the store. You don't, going to the store with kids is such a pain in the ass because I want this and I want that. Now, it's so much easier

to not bring kids at the store. Is it not? Ben, somebody emailed us. I need to hear the full Ben's dad wardrobe story. Michael cut you off. Can't believe it. Oh, there wasn't really a full story. It's just my dad literally never spent on his wardrobe.

He had the same pair of Nike warm-up pants for like 20 years. He just, my dad could not have cared less about material possessions. He had, like, one suit, he had, like, he never got new clothes. I would have to buy, we'd have to buy him new clothes for Christmas, and usually he wouldn't want him. So my, my dad is, like, the most lack of material possession person that I've ever met in my life. Hmm. But he's happy with it, so more power to him.

Okay. My parents, hang on, travel story here. My parents did a trip to Ireland a couple weeks ago, and they went with him a bunch of other people, and it was like a bus tour of Ireland, and I think they got to go see all the cool towns and go to a couple different pubs in each city, right? My mom's family, my mom's maiden name is Kennedy, so she's big on the Irish thing, right? And I asked my dad, you know, how was it? Oh, it was, you know, a bus full of boomers. And my whole thinking is just that I'm bullish on boomer travel expenditures for the next 20 years. And I went, I pulled up Royal Caribbean. Have you seen

Royal Caribbean stock lately? Because those cruise ships are going to be full for the next two decades. Look at Royal Caribbean stock. Obviously, people got to this one before I did. What do you call that? That's like a massive breakout, correct? This is at, is that an all-time high? Looks like it. It is an all-down, which is crazy.

It came all the way back. So, I mean, this stock was down how many, what? 70% during the pandemic. Huh. Kind of surprising. All right, gentlemen, you both have a car lease is why. The legit question, the minute I could write a check for my lovely depreciating asset, I did,

and I've had three cars over the past 20 years. No, a car payment has saved 10 to 15% up to purchase. And every personal finance book, every in my 20s equated leases with something akin to devil spawn. Again, legit question. You were smarter than your average bear, so what am I missing? I wrote a blog post about this before. Go ahead.

I wrote a blog post about this before. I like having a newish vehicle every three to four years. I have kids who destroy it, and the payments lower. And I did the thing in the past where I paid off a car and drove a car into the ground. want to do it anymore because the amount of money you pay for repairs and a hassle that it costs, to me, is not worth it. Okay. I would mostly agree with everything you just said. I don't, this is something I don't care about. To me, this is not a finance. There's not a spreadsheet decision.

I'm willing to pay more money for the luxury of having a new car every three years. It's fun. It's exciting. I enjoy it, even though I pretend to complain about it. I like getting new cars. And I don't care if I'm spending more on a lease versus owning. In fact, I know I am, but there are certain areas of my life where I just, I don't care about the money. And this is one of them. New car smell is worth it, too. Yeah. Yeah, love it.

Okay. What's the worst place for small talk, Ben? All right. Can I guess? Yeah. It's an elevator. Elevator, we bad. Here's the, no.

You know who talks in the elevator? Yeah, the Barry. Barry. I can't He'll talk to strangers The real thumb usually is If you're having a conversation In the elevator and someone else gets on

That conversation ceases to do If you're in an elevator, here's what you do You put your head down Head down, yes No, but so I had a dentist's appointment today The worst place for small talk is the dentist Because you're laying in a chair So they have high ground on you

Oh, how are the kids? How was your summer? Yeah, you can't talk when Stop talking to me, just do your thing That's the worst place for small talk You ever meet a young dentist? Yeah. It's kind of funny, right?

When you've, you're like, I'm a dentist. Oh, because your whole life you view them as being older dentists? My dad was a dentist, a parodontist. It's not a, not a braces dentist, but yeah. What's a peri dentist? I don't know. Sounds like a dinosaur. Like implants.

Okay. Dental implants. Okay. So you got veneers then? All natural. You know how they do that? So I heard this story from a hedge friend who works at a hedge fund. And she told me,

whenever the portfolio managers or analysts get their very first big bonus, the first thing they all do is get brand new veneers. That's like the thing. My dad did do veneers, but what are they? Are they literally teeth on top of your teeth? It's like porcelain teeth. But she explained how they do it, and I never knew this. They literally grind your teeth down to the gum.

And then I don't think, yes. And then they put... Oh, my God. Just thinking about that doesn't make you want to do it, right? Ben, I got an MRI. I've had a headache. a persistent headache for a couple of weeks. And I think it's like,

I think it's a blood pressure thing, it turns out. My blood pressure is slightly high. I went through to over 90, which is like not that bad, but I've been taking blood pressure medication and I've been feeling better. So I want,

I want to get an MRI just to make sure that there wasn't anything bad up there. And so he puts me in the machine and didn't tell me that it's loud, really loud. So I'm in there. And it went, er, and I almost jumped. It was super loud.

But I got the results a day later. And you know what the results of the scan said? It called my brain Unremarkable. Wow. It matches the title of your blog. Pretty good. A relevant investor. Pretty good, but also a little bit insulting.

So I think we need a new way to gauge blood pressure. Because you say the numbers, I know you can look them up, but I just need it on a scale of one to 10 or one to 100, right? Where 100 is good and one is bad. Like, I got my physical last week. And they're like, oh, your blood pressure is 120 over 70 or whatever it was. And I'm like, oh, great, that means less to me than the dipstick at the oil change place. I don't know what that means.

Is that good or is it bad? So, Ben, I started, I got a trainer, what, probably like two years ago. And the reason why I got a trainer was because I hurt my back. We have new listeners since this story happened. It's probably two years ago. I hurt my back sneezing. Like, bad. Like, it fucking hurt.

I couldn't. I went straight to the ground, my lower back, I couldn't, like, get up. And I said, so I found, I said, I got to start working out, striking out my core. And so I've been with this trainer for two years. And every- How many days a week are we talking here? Two days a week? Monday and Friday for 50 minutes.

I got to be honest. I hate it. I hate it. Still hate it. You don't get any satisfaction from it. I hate it. I really don't enjoy working out. But I paid him for a few reasons.

By the way, my back has been much better. So that's why getting to the, This is like the car lease versus buy thing. Some people would tell you, Michael, suck it up and go to the gym yourself. But if you paid it, you need to pay someone to help you do it. So I pay this person because if I don't pay him, I'm not going to work out. But hopefully I'm turning the corner because I'm here to tell you that two years later, I just stopped paying him.

And I'm sharing this for a few reasons. One, because I want to help Matthew. So if anybody's been curious about working out, but you don't want to go to the gym. So Matt, it's on Zoom. So he helps me on Zoom. So I thought this is going to be a short-term thing, right? The only reason why I stuck with him for two years is because I like the guy so much. I talked to him like I talked to him.

My wife's like, who you do? You don't talk to anyone. Like, so we talk about movies. We shoot the shit. We talk about our lives, our kids and stuff. So I love this guy. I feel bad that I'm canceling. You cheated on me.

So wait. So do you feel like you know the work exercises now or you're going to do them on your own or not? So it's a combination of that. But primarily, it's just too disruptive to my schedule. So I do it every Monday. and Friday at 9 o'clock and half of the time in between my sets

I'm on my computer. It's really hard to be away at that time. Now, why don't I do it in the afternoon? Shut up, but I want to. That's why. But if you are curious about starting to work out,

we're going to have a link in the show notes or email me. I love this guy. It's the only reason why I stuck with it for two years and I would love for some of you to experience what it's like to work out with him.

Now you're an exercise broker. I'm an exercise. broker. There we go. But I went to Kava for the first time. I'm not sure how it's my first time. I don't know what Kava is. What is it? Okay. It's a publicly traded company. It's Greek Chipotle. Oh, okay. And I went to one and it's phenomenal. And I walked out, the place was packed. There was a policeman inside. That's how busy it was. There was a, not a policeman getting food, like guarding, I guess the area where people pick up their order. Is this in the suburbs. In New York City. It was so packed. I went to, when I got to the desk, I went to the

computer and I punched up the chart. Like, maybe I should buy this. Like, Chipotle, all-time high. Stock is absolutely on fire. Food, phenomenal. Totally get it. Okay. They don't have it in Michigan. Really good. But, but more expensive than Chipotle or similar? Yeah, 13-ish, but really excellent quality. All right. Before, oh, wait, I got one story for you, for when you get your new dog. So my mother and father-in-law had a dog back in the day and they put these little bells on the door,

hang it with a little string, those little circle, like Christmas bells, you know? Yep, yep. They hang it on there, and they taught their dog to hit the bell when she had to go out to the bathroom. So for our first dog,

we said, we're going to do this. And so every time she went to the bathroom, we'd bring her out, we'd hit her paw on the bell, and then bring her out, bring her and give her a treat as we're training her, right? A month later,

she kind of perks up and she runs over and she slams into the bell. And after that, she did it. and it works. And she would go over and hit the bell. And so we tried it with our new dog. A week in,

she's already using the bell to go to the bathroom. Wow. Isn't it crazy how smart dogs are? All we did is hit her pot. And then the other day I'm doing laundry. I'm changing the laundry out because I'm middle class. I don't have someone fold my laundry for me like an upper class person. And all of a sudden I hear the bell ring.

And I walk out and the dog sitting there looking at me, ready to go outside. I can't wait to get a dog. My wife sent me a picture of a boxer. And she said the store has it. I was ready to go. I called the store up. False advertise.

She's like, oh, no, we don't have that. We can get you a box. I'm like, well, then, what? I miss my dog. I really want a dog. Starting out a new puppy with kids is a totally different experience, too. Watching them take some responsibility

and play with her and bring her to the bathroom. So my dog was like, I'm not saying that I love my dog more than anybody else, but my dog was my baby. I was, because I was unemployed when I got her. I was a ton of time. I was at home with her for like almost two, full years. She was like my only friend. And life is not the same without dogs. All right, Ben,

uh, somebody emailed us. I've started listening in the past six months. What's not clear to me is how you guys have the time to consume so much new content to recommend. Trying to understand for myself is on mid-30s with young kids. And I haven't owned or watched a TV since before COVID. Dude. Wow. Owned a TV? We get this question probably once, we have to answer this once over two It's not complicated. First of all, I might have a little bit of ADHD. And I say that to say that my life is chaotic. If you were looking over my shoulder on a daily base, you'd say, what in the world is wrong with this person? I'm chaos, but I've learned how to harness it. I am very, very efficient with my content consumption because I consume so much of it. I've got a system in place. And it's, listen, there's a lot of hours in the week. So my kids go, I don't know about you. Ben. My kids are done at 8, 8.15. So there's an hour 45. I go to sleep 10, 10, 15. There's two hours every single night. So that's 10 hours during the week. Not that I'm watching two hours every single night. Maybe I am. And then my wife leaves for work at 6 in the

morning. So I'm up. If I wanted to, there could be an hour before the kids get up before I get out of bed. So that's 15 hours a week. That's a lot. And then, you know, just, I mean, there's so much time. It's just, but you got to prioritize. And when you have kids, you don't have a social life as much. You have a little bit of social life, but not like you did when you were younger. And I'm a night owl. I stay up till midnight every night almost. And so I have, my wife goes to bed at 9.30 or so. Kids are in bed by eight for the twins, nine for my older daughter, 930. And then I have two hours by myself. I feel like there's nothing but time. Yes. And I'm multitasker, too. If it's a show that I don't have to pay attention

to, I'll be answering emails or writing a blog post or whatever while I have a TV or show or movie on, too. So speaking of TVs that you have in the background, Bad Monkey is that for me. I don't know if I'm going to get through the whole season, but it's like background show. Would you agree or do you really enjoy it? I still like it. I'm just, I love Vince Vaughn and his quips and such.

It does kind of feel like it probably could have been a couple episodes shorter, but I hope they make a second season because there's a second book on it. No offense to Vince Vaughn, you know, one of the, one of the goats among goats. But I will say, the, the, giant forehead Botox does look a little bit weird and the hair, the whole situation just looks odd. I mean, he definitely got some Hollywood hair, correct? He did something.

It doesn't, it looks, it looks, it looks, uh, I thought he was looking at work on. I thought he was looking, well, he doesn't look like that work. I thought he was looking at work. I thought he was looking at his age. I'm just saying, it just looks a little weird. Okay. So I was trapped, when I was traveling last week, I realized as I got to the airport, oh, no, I forgot my Kindle paperweight.

That's what I read on. And I'll have like five or six books going at once and I'll kind of hop back in fourth, you can highlight in there. And so I had to go to the bookstore to get a book like a schmuck. And I got like a paperback book. It's like the house on the lake or the house across the lake or something. It was, it was like, it's okay. It was kind of a page turner, like a beach read, basically. Yeah. Right? There's like three twists at the end where you're kind of like, okay, that twist was a little too much. Could it just on one of them. Just get rid of one of those twists. But I realize that I can't read physical books anymore. It's way harder. Reading a paperback book,

You have to like, you know, like push it open to see the edges. And, like, reading on a Kindle is so much of a better experience. I didn't realize how much I would miss that if I didn't have it. Have you tried it yet? The Kindle White is amazing. It's such a better reading experience. Especially on the plane, you can turn the brightness up or down. You can highlight stuff.

There's a website. I like how books smell. There's a well. And I did too. There's a website where you can see all of your highlights in one place. That is very cool. And then one more. I watched Rebel Ridge on Netflix.

And I got to say Netflix movies are getting. better. This movie wasn't like... Because they're not making as many. Yeah, they're getting higher quality. This, I thought this movie was, it could have, it should have been 90 minutes, then it would have been really good. But the first like half hour of the movie is cooking. When the cops first knock him off his bike and you start to realize who this guy is and what he can do. I mean, it's a rip off of like Rambo and a bunch of other movies, but I thought it was really well done for a Netflix movie. Yeah. It was entertaining. Yeah. Okay. Oh, so last night, I went to see the substance, the movie with Demi Moore. It's like

a body horror movie. It's a very Kronenberg-esque. Probably not for you. Another movie I've literally never heard of. Probably not for most of you. Debbie Moore, like, it is weird that she was like such an icon of the 90s and hasn't really done much work that I remember. So I typed this movie in and it says, the extreme body horror film causing mass cinema walkouts around the world. Is that true? Is there a walkout? Well, there was only four people in my theater, so we all stuck around. I enjoyed the shit out of it. It was a good movie. Okay. She's in a new TV show. I can't remember which one it is. Anyhow. Um, so if you are of that persuasion, yeah, you'll like the movie. But I want to...

All the headlines say that this is a demented movie. Oh, yeah. Totally. I'm a, I'm a sick puppy. Yeah, you are. Um, so there was a, uh, one of the trailers was Y2K, uh, 824 hard movie, which I... I think that actually looks pretty good. Can't wait. And there was one scene in the trailer where this guy was using devil sticks. Now, if you're not, if you're younger than Ben and I, you probably have no idea what a devil stick is.

Devil sticks are two. I don't know what a devil stick is. Remember there's like drumsticks with a long stick and you would like hit them back and forth? Oh, yeah, yeah, yeah. You'd see the guy outside of Spencer Gifts doing it to like you get to go in the store.

Okay, credit to me and definitely you, never believed in devil sticks. They were always the dumbest shit ever. And the kids that used devil sticks, there was so, you remember that? Yeah, yeah, yeah. Yeah, the guy in the mall will be doing it. Yeah, it was like the people that were bigger to yos.

Yeah. But even dorkier. I don't know that's what I was. Probably, I would also probably put a hacky sack in the same category. Oh, yeah. Hockey sack devil, devil sticks. So dumb. Great moment of the time.

All right. Lastly, by the way, are you watching the penguin? I haven't got into it yet. Quite good. Okay. Quite good. But there's no Batman in it? Not yet.

Okay. I totally understand if you go. can't, but I have a big ask for the scary movie King himself, Michael. Thank you. Michael, I'm wanting to watch one scary Halloween theme movie every night in October. Can you throw together a list of 31 movies to watch? Geez, save some for the rest of us, dude. I threw together 46. How about that? So I, I charted it, and I charted it by year and by audience scoring around on tomatoes. So I've been asked this question multiple times, and I just never put pen to paper, so to speak. So thank you for the nudge. Here it is.

I hope you enjoy them. And aliens, your favorite one on here? No, no. This is, this is by year and audience review. But I'm asking, what's your favorite of this list? Oh, I don't have a favorite. Come on. Okay.

These are my favorites. I have 46 favorites. 46 favorite horror movies. Okay. There's some that I, like, there's, as I'm going through the list, because I cross reference to make sure I'm not leaving anything yet, here's what's off my list. No Jason movies except for Freddie versus Jason, which is obviously not, it's a horrible movie, but it was fun to see them collide.

probably should have Friday the 13th on here, but I don't. I don't have any Lepricon movies. Those were silly. Not a big, not a big zombie guy. I don't have any zombie movies on here. Although you have Halloween Rob Zombie. I do. I love the Rob Zombie Halloween.

I did. Okay. All right. I've probably seen like three of these movies. Great. I'll give you credit for putting it together, though. Way to go. Thank you.

I saw that email come in and I was like, Michael's never going to do this. And credit to you. Oh, one last thing. So I don't know why I thought of this movie. I showed my kids three ninjas. Do you remember that movie from back in the day? Sounds familiar.

So my friend texts me, Rocky loves Emily. That was like one of the lines in the movie. So I said it holds up. And he said, I haven't seen it in like 20 years, L.O.L. Watch with the kids. Oh, it's like a little kid movie. Yeah.

So I said, so he said he hasn't seen it in 20 years. I was like, bro, we're old. If you haven't seen in 20 years, it means it you saw it when you were. in college and I highly doubt you watch as a college more like 30 years. That's how old we are. 92. Yeah, it's like 30 plus years. Yeah, 30 years ago. All right. After your time.

All right. Holds up if you want a movie for your kids. All right, Ben. That's a long show. Sorry to Duncan and the crew for keeping them so long. Duncan, Michael had to go long because he did this chart of horror movies. I did like

how you segmented it out by year though. Thank you. That was well done. Ben, give the dark and the wicket a try. Just kidding, don't. All right, Animal Spirits at the Compound News. Thank you for all the questions. We'll see you next time.