Animal Spirits Podcast - Unaffordable Housing (EP.225)

Episode Date: October 6, 2021

On this week's show we discuss supply chain problems, buying Christmas presents early, why progress requires inflation, investors have been spoiled, housing affordability in the United States, Zillow's problems buying houses, Squid Game and much more. Find complete shownotes on our blogs... Ben Carlson’s A Wealth of Common Sense Michael Batnick’s The Irrelevant Investor Like us on Facebook And feel free to shoot us an email at [e-mail] with any feedback, questions, recommendations, or ideas for future topics of conversation. Learn more about your ad choices. Visit megaphone.fm/adchoices

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com. Welcome to Animal Spirits, a show about markets, life, and investing. Join Michael Batnik and Ben Carlson as they talk about what they're reading, writing, and watching. Michael Battenick and Ben Carlson, work for you. for Ritt Holt's Wealth Management. All opinions expressed by Michael and Ben or any podcast guests are solely their own opinions and do not reflect the opinion of Rit Holt's wealth management.

This podcast is for informational purposes only and should not be relied upon for investment decisions. Clients of Rit Holt's wealth management may maintain positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. We have a new category that we're going to lead the show off with. And I feel like we've had this category. We've been talking about it.

But now it's officially, it's a standard. alone in the document supply chain. And I want to tell you a quick little story. This weekend, Robin said to me, she's like, do you know about the, there's like ships in Los Angeles? I don't know if we're going to have toys for the toy season or whatever for Hanukkah. And I was like, you know I have a podcast that like talks about like finance and economics and stuff. So while you get your news from Good Morning America, if you could assume that yes, I've heard about this. Anyway. We had a conversation about it at like the parents at the soccer games this weekend. It's got mainstream. My wife has already started ordering Christmas presents because

she's worried they're not going to be there because they told a lot on the Today Show. So your wife is Today Show. My wife is Good Morning America and we're Animal Spirits. So is this like the Shushine Boy equivalent that if the Shushine Boy is talking about, it's time to sell. So if my wife, your wife is talking about supply chain issues, does that mean it's time everything's could be okay, bicyclicals? My favorite part of these stories is usually the telephone aspect of the, remember the telephone game? Of course. One person always be. like, you know what the problem really is? It's that the dock workers aren't working 24-7. They're taking weekends off. They're not working past 6 o'clock. And then someone else be like,

no, no, no, no. I heard the actual problem is it's the truckers. Not enough truckers to take them off. And it's like, no, no, no, it's the train. So this thing's just a big cluster. I don't know. So you put this in the dock. How long will this be here? What's the over-under for six months? Six months over or under that this is going to be in the dock for supply chain issues. I'm going to take the over. Not to be a pessimist, but I'm going to take the over. Until into end of first quarter, you think supply change is still a problem then. Listen, these are complicated issues. They don't get solved quickly.

All right, but here's the good news. So this is on the cover of balance this weekend. Will shortages ruin the holidays? What you need to know? So the executive director of the Port of Los Angeles. So take this with the grain of salt. He said, you heard it here first. Christmas will happen on December 25th.

That's technically true, whether or not toys will be there. Christmas will happen. That's like the joke people make on finance Twitter when the market is crashing. They say, to the market will close at 4 p.m. today. I've made that joke before. Of course you have. It's been a while. You can't go to that well too often. He said many of our savvy retailers and importers advance their orders. We started seeing Christmas goods arrive on our shores back in June. Normally, that arrival would take place at the end of August, beginning of September.

But now the question is, our parents even front running that. So the retailers might be getting ready. But what happens if my wife, your wife, other wives start front running this, dads too, and So maybe the Howard Mark's second level thinking here is I'm just going to buy all the toys on Christmas Eve because then they'll be restocked and no one will want them. Or, you know what, good never runs out. You can always get your kids doge coin. That's true. Like at the 11th hour, if you're totally screwed on December 24th and you're scrambling, you have no toys. My kids do like dogs. More from the article.

Toy maker sound confident. Mattel said that they are guiding for a 12 to 14% sales increase. Nerfmaker Hasbro said some sales might slip. Maybe we'd like a little more product, but we have the product for the holidays. We'll be fine. For transparency, I don't even know why I said we'll be fine. That was me literally putting words in his mouth. He did not say that.

I apologize. That's bad journalism right there. No slander for animal spirits. Do you think any of these companies that are now global in nature that will say, you know what, screw it? We're building more factories in the United States. We're not going to have this happen in the future. Is that too much to ask?

An overcorrection? Yeah. Do you think that any companies will say, that and say, we're not going to deal with the global supply chain anymore because it's obviously becoming way more expensive to ship as well. Dude, at $18 an hour? No, that's not on the table. No chance. True. But if anyone would do it, wouldn't it be Amazon? To start making toys? I'm just saying some of their products that they, obviously they do a lot of third party, but one of the issues is Vietnam factory shutting down for COVID. I can't imagine what the wages are

there compared to here. I don't think that's viable. At a Rhode Island mall this past week, a teenager who was at the kiosks said, quote, I've had a couple of parents say they might as well save these items for Christmas. So anyway, where does this go? Where does it end? I don't know, but I'm taking the over on six months, Ben. I'm curious when we get to the point where the over correction happens and we are just at a glut of supply.

That's going to happen eventually. Hanukkah will happen the second week of December or whenever it happens. There will be eight crazy nights. We got an email from a listener talking about beverage. supplies, a beer maker. Don't need to name the beer maker, but it's a big one. He said we're literally out of 12 packs. The wholesaler is out too, so the supply lines are empty and will need to be filled before the stock settles. This beer maker's products have been on allocation for over a year now, and they still haven't filled the pipeline, not even close. A local

wholesaler couldn't get a container of German beer out of the port for the entire months of May and June. Wine and spirits are in the same boat. Haven't seen anything remotely like this in 25 years. Here's my prediction for corporate executives in the coming, like, quarter end company results. First, it was people, like, if you had bad results, and let's say like these issues didn't even impact you, you would blame inflation. Now, if you have bad results, and even if it's not, if you don't have supply chain issues, you blame supply chain. So every CEO. It's a get out of jail free card. So this was interesting.

We spoke about this on listener questions. You made the very good point that there needs to be a little inflation. Yeah. If we're talking about inflation versus deflation, inflation is the. Lesser of two evils. Because prices aren't going to say the same. And if prices start falling, that's very dangerous because then, of course, rising prices impacts consumer behavior, but falling prices might have a much worse impact. If people think prices are going to continue to fall, they delay buying and then spiral, spiral, no good, no good. So a director and senior

economists at Wells Fargo, this is a cool chart. There's the portions of items in the price index with price increases. And it's high. It's really high. So this is an alternative index. And this person said that they're signaling that inflation is not as extreme as what the headline or traditional course shows right now, but it is picking up. A senior U.S. economist at Berkeley said, to see price pressures picking up, but not at extremely worrying levels, it's progress. And I thought that was a very interesting tape because the knee-jerk reaction is to get

worked up that inflation is going to spiral out of control. But maybe actually, this is definitely better for you to defend, not me, because I'm a realist, you're a Fed employee, that actually price increasing is actually progress. So why don't you piggyback on that? First of all, on this chart, I think the most interesting thing on here is the 70s and 80s, you had 100% of items increasing in price. Literally everything in the basket was going up in price. So now it looks like it's over 80%. My whole thing is that like this pie is always expanding. And so that's... Which pie? The economy. So when growth expands, debt expands, prices rise. It's all part of the same interlocking.

You can't have the pie get bigger and prices fall across the board. That's my whole thing. It doesn't work like that. That's, again, it's the lesser of two evils kind of thing. Ben Breitholz puts these great charts together at Arborate Data Science, and he said that transitory language from the Fed peaked in mid-July. So it sounds like maybe they're getting religion and seeing that a lot of these price increases are perhaps not transitory.

Isn't it funny? Just saying the types of stuff were able to map these days. We did the chart a couple weeks ago about how many times Lehman Brothers was mentioned in stories. Now it's how many times the Fed has said certain words.

You got it right. What? Lehman Brothers. Yeah, whatever. I just think it's just fascinating all the things that we can map out now. He's got this data going back to the 1990s for types of words that the Fed is saying,

I don't know what it means, but it's interesting. All right, I want to put you all on to my favorite new substack. It is, I guess, pessimistic in nature and its flavor, but it is very fine writing. Yeah, by the name of it alone, you could tell that. It's very witty and clever. And I hope it doesn't get too too doomy, even though the name of the substack is Duneberg, but very clever. He wrote a post on what does price mean when there's no supply?

And so I don't know anything about the art market, but this was a piece about Rolexes, why the price of a new Rolex doesn't mean jack shit because you basically can't get a new Rolex, they're not making them. And why the prices of used ones can actually go for more than new ones because that's where the supply is. So it's like the car market right now. Yeah, it's very similar. So I thought this is very interesting. And the kudagra from the article is, quote, so he's talking about Rolex stores or distributors, whatever you call them. He said, the juxtaposition of gorgeous branding and store design with empty display cases and board salespeople is the perfect metaphor for our time. So if you walked into a Rolex store right now, you couldn't get one, basically. Yeah. More or less.

So his post leads off with, he was at an investor presentation and some young kid was wearing like a kind of a funky Rolex. And he's like, why the hell is he wearing that? He's like, oh, yeah. He's wearing this because he wanted to get a Rolex. He went to the store and this is all they had. That's why he's flexing on us with this weird watch. So we are taping this Monday afternoon.

The S&P 500 is now in its first 5% correction in over a year, I believe. It's been a while. It's been a long while. I'm going to make the case that investors are spoiled here. This is a headline from Bloomberg, and I'm not calling out the people who wrote this headline. I get it, but it says, battered 60, 40 strategy followers face more pain as yields rise. Battered! The traditional U.S. asset mix of 60% stocks and 40% fixed income securities was down

about 97 basis points in September, 1% in September, and we got battered in the headline. And as someone who's written for publications before I understand, the people who author the article never get to write the actual headline, so it's not their fault. But I think that people are just kind of spoiled. Battered. Battered. It's saying that's like the biggest monthly loss since last October and yields are moving higher again. So, I mean, things have been so good for investors that, I guess this was bound to happen. You're bound to see worlds like tumble and turmoil and all.

all these things because stocks are falling. By the way, the NASDAQ 100 is fast approaching a 10% correction for the second time in about a year. So there's that. I mean, this would have happened if it wasn't for the Evergrand story. I mean, that was the canary in the coal mine. Hey, listen, jerk. That did it. What happens if this rears its ugly? It's the second biggest real estate company in China. Come on. Hit me with it. Listen, what if the mark? By the way, that's the only thing you have on that one. The market falls 30% Evergrand default. Sending ripples across the economy, markets are down 30% and Ben's yawning. Let's bring it.

We need something. Why be so cavalier in the face of risk? I just don't understand. I mean, you could say, like, listen, this is probably overblown. But to be so blasé about it, I mean, you're tempting the market guys is all I'm saying. Show a little respect. Yeah, I was right. All right, this one's from Lizanne Sanders at Trell Schwab.

She showed equities as a percentage of household net worth by age. And it was over 69, 55 to 64, under 40. Come on, you know my rule, right? What? When you become a dad, there's no more 69 jokes. Sorry, that's the rule. You can't wear your head backwards anymore. No 69 jokes. Sorry, those are the rules. I don't make them. And it's showing that they're increasing. So in 1990, people over the age of 69 had 11% of their portfolio in stocks. Now it's 31. These numbers are still pretty small, if you ask me. But the point of the whole thing is that they're rising across the board from 1990 to 2021. Equities as a percentage of households are rising. People that, to thank the Fed from pushing them out on the risk spectrum and getting all these excess returns? Yeah, maybe. But I mean, this is the kind of thing where some people will look at this and go, this is worrisome because, and I looked at the Jesse Livermore quote, remember he had the

greatest stock market indicator of all time. I looked at this last week. You were talking about the pseudonymous, Jesse Livermore. Yes. So he uses household equity allocations as a way to forecast future returns in the model shows that in the past, when allocations to equities were high, future returns were lower. So it got to like 50% in 2000. That's the height it's ever been. We're now back there at that same level. And my thing is, this is the way it should be right now. Back then, interest rates were 6%. In 1990, interest rates were like 8 or 9%. So equity allocations should be higher. I'm actually surprised they're this low. 50% seems low to me. I'm going to make the case that this is another model that could go to the dustbin in history. Easily. You're going to see a huge

divergence there because it's a totally different world. It makes good sense that when everybody owns stocks, and again, 50% is not everybody. But the more bullish people get in general, the lower stock market returns should be going forward. Of course that makes sense. I'm not completely dismissing it out of hand. But I guess what I'm trying to say is it's different this time. I just think with generationally low interest rates, it would be even stranger if equilocations weren't at all-time highs. That would be the situation where I go, wait, what is going on here. All right, we got a bunch of theories about rich dead, poor-dad guy, because we did a whole diatriab in him last week. Here's one that I'm putting together a bunch of people

wrote in. So the majority of gray-haired investors who are out there as pundits that are making these crash defensive calls for the last eight, nine, ten years, people like Jeremy Grantham and Howard Marks and Mohamed L. Arian, they've been very defensive the entire way up, telling people to caution. Here's the simplest theory maybe on why these people are always so cautious. Following the great financial crisis. We had a long short hedge fund manager in the endowment I worked for, and he went really uber defensive coming out of the crisis and missed out on the whole rally for a few years. And his whole thing he told us was, listen, I have every penny of my liquid net worth in this fund, and I decided to manage this fund coming out of such a huge crisis as if there's no way I was

going to let it go to zero. So if we had a great depression, I wasn't going to let this happen. I got defensive, and that's why I probably missed out on a lot of this. Think about how rich these guys are. Grantham and Marks and Ellarian and people like that, they're already loaded. So with so much money that they have $100 million, they all made a ton of money. Marks is a billionaire. For them getting defensive, they're trying to preserve their wealth. So saying and staying defensive for so long for them was probably more about their personal assets as much as anything, correct?

Yeah. They're trying to preserve their wealth because they already have it. So it makes sense. It makes sense in a lot of ways. And Robert Kiyosaki is trying to, he's trying to help us for West Nile. So I just wanted to read one more tweet someone sent us. Please. This is another. West Nile disease is shutting down the economy. West Nile is spread by mosquitoes. Don't know if West Nile is real or fake. But the economy will not survive another pandemic. Gold, silver, Bitcoin are your best antibody defenses from medical and economic and sanity. Take care. When did he tweet that? When did he tweet that? Like five days ago. I was looking for somebody emailed us about why Kathy is trolling. I I feel like I put that in the dock, but I can't find it. Does that ring a bell? Okay. I don't have that one either. I just think the funny thing about the finance world is you could be a one-hit wonder, and that can take you through your whole career. Remember the tub-thumping guys? The who? I get knocked down and I get up again. They had like the one-hit wonder. You hear it all the time. Yeah, but what did you call them? What's that tub-thumping? What's it called? Tub-thumping? What's it

called? Tub-thumping? Chumbab-wumba? Yeah. I don't know what tub-thumping is. You might be right. I don't know what that is. That's the song. Tub-thumping is a song. Okay. That was like their one-hit wonder. The finance equivalent of that would be like, these guys still coming and hosting the VMAs every year because they had one good song. That's the financial equivalent of someone getting a one-it-one or call right or a good book early in their career and then using it the rest of their career to prolong it. I found that this was a good troll from Kathy. Kathy Wood tweeted, today Tesla announced that in the third quarter, it sold 241,000 vehicles globally, up 73% year over year and 20% quarter. Meanwhile, GM blamed the 30,000.

3% year-over-year decline in its U.S. sales on chip shortages. What EVs require three to five times more chips per car produced? Solid trolling on her part and also very, very fair and accurate. And come on, GM, what's up? That's true. She's getting good at this. Hungry now. Now.

What about now? Whenever it hits you, wherever you are. grab an O'Henry bar to satisfy your hunger with its delicious combination of big crunchy salty peanuts covered in creamy caramel and chewy fudge with a chocolatey coating swing by a gas station and get an O'Henry today oh hungry oh Henry okay so I wanted to do a little bit of debunking here I've seen a lot of these stories lately about endowment funds okay and how they are crushing it and so this is from the Wall Street Journal. University of Minnesota's endowment gained 49.2% for the year ending June 30th. So it takes

them a while to report sometimes because private equity and venture capital is on such a lag. Duke reported a gain of 65%. Washington University in St. Louis reported a gain of 65%. Speaking of Duke, you see Danny Dimes, number two overall quarterback rating in the NFL, not to brag, still one in three, but still. Okay. You guys had a nice salvage. I don't want to hear about I'm a alliance fan still. University of Virginia gained 49%. They're attributing a lot of these gains to investing in venture because they said the average value. I'm sorry, what time period do we talk to here? So this is June to June. They, for some reason, endowments do a June 30th year end. And it takes a while for them to get all their private equity market valuations and stuff in. So they're always reporting on

a big lag. What's your fiscal year? What it mean? Personally? Yeah. I just operate 24-7, Michael. There you go. I grind in a daily basis. So they're saying the average valuation of early stage US startup shot up to 96 million in the first half of 2021, up over 50% from 62 million at the end of 2020. the fact that these places have done a huge push into venture is the reason their returns looks so high popping. But I'm like... They're like making their own alpha by putting money into the space? I don't know if this is really alpha. So over this same time period, this is a time when markets shot up big time. NASDAQ 100 was up 44%. So not even, not really that high.

Small cap, Russell 2000, up 62% and microcap Russell, ETF, up 76%. So I'm trying to put these numbers into context. I'm saying good for them for having such big returns, but I think that comparable microcap slash Russell 2000, you probably could even do Russell 2000 growth was probably a little better, putting these into perspective a little bit. That's all I'm saying. Fair. I mean, let them have a victory for once. I'm just saying people are like, how could these endowments be up 50 or 60 percent? This is why. Right. Getting back to the startup thing and having these huge startup valuations, Angel List just announced this thing called Angelus Stack. And you and I have been talking for a while now about how the environment for startups is unlike anything we've ever seen

before. And we're not startup experts or anything, but the stuff that we're seeing and hearing from people, Angelis is starting. They're basically creating this stack to get you ready to fundraise as a startup. So this is not allowing people to invest in startups. It's actually helping startups get off the ground. So they say everything from a corporation, banking and equity management tools in a single place so you can focus on your company. So they're handling all the back office stuff for a startup so you can get going and potentially raise money. We've talked to a number of startups in recent months and years. And this is not like the 90s. Everything I think is so much more professionalized, but also different because you just have such a long runway as a startup founder now. How many conversations that we had where we go, what's the business plan? And they go, I don't know. I don't have to figure it out yet. I mean, just imagine, like if you tried to put together a business plan in college for a project, you could never say that to your business professor, right? Getting your MBA and doing something like this. Well, what's your business plan for this? Well, we don't have a business plan for this. Well, we don't have a business. business plan. We just have a good idea. I mean, some people look at this and go, okay, you're

creating zombie companies. I look at it the other way and say, I think this is pretty cool that people these days have the opportunity to really have a runway to see if their ideas and products can actually turn into something. Yeah, I agree. I mean, there's, I guess what you're saying is companies are having such an easy time today raising money that they have a longer runway. It's not like they have a couple of bad quarters and it's over. Yeah, they have time to see if this stuff actually works. The theme of a lot we've been talking about last weeks is there's so much money sloshing around. People have to put it somewhere. All right. So we got an email from a listener, Kobe Lefkowitz, and we have, I'm sorry, is it Cody or Kobe? I can't remember.

We have referenced his stuff in the past. He wrote an article debunking the myth that institutional investors are buying every house in the neighborhood. So he emailed us and said, I don't know if you followed the Zillodrama the last few weeks on TikTok and Twitter, but it's quite a story. There's been a massive backlash on Zillow's I-buyer program, which has placed blame at their feet for fueling the housing crisis by acquiring several homes in a concentrated area, then buying one for an artificially inflated price to make all the others more expensive on a comp basis. This is, of course, false, verifiably so, as the market doesn't work like this. Zillow and other eye buyers only control a very small portion of transactions per year,

and they're mostly unprofitable anyway. So some of the data that he gave us was from April 2018 through the second quarter of 2021, Zillow bought 17,000 homes and sold 13,700. So to put these numbers in perspective, there are 86 million single family homes in America. Last year, six and a half million were sold. Of those six and a half million, four thousand were bought by Zillow, less than one tenth of one percent of transactions. And funny enough, it's actually turning out to be a terrible business for Zillow. at least right now, it is not working very well. Zillow is losing money.

To date, they've lost $667 million, arguably impressive in a time when the housing market has increased by more than 30% in value. Now, take this for what it's worth because it's from Redfin, but they said, because people are saying, like, yeah, well, Zillow is just paying whatever they want, thereby making all the comps higher, making everybody lift their prices. So even if they're only buying a small amount of houses, everybody else is lifting. That's bullshit. Redfin says that the average value of homes that I buyers have acquired is roughly 6% lower. than the median average in the markets that they operate in. But his whole point in his piece was, what kind of business strategy would that be for them to just overpay for houses all the time?

Eventually, that's not going to work. We're going to buy high, sell low. But we get emails from people. I'd say we get one every two weeks talking about Zillow inflating housing prices on their block or their area. And I think this is one of these anecdotal things where people think Cody and his piece said, it's like this dangerous allure of using easy anecdotes to explain complex problems. The problem is certain people get this in their head and they want someone to blame for things. This is probably true for most people who are trying to buy right now.

They want someone to blame for housing prices shooting to the moon because they're getting priced out. Yeah. So on the one hand, housing prices are becoming more affordable. We'll get to that in one second. But here's a great, great anecdote from a listener to show that not only is they're not driving up home prices, but they're actually taking a bath along the way. So Zillow bought a home near me for 300. This is from a listener, for 393K, listed it literally four days later for 388K, 5,000 less than their purchase. This is anecdotal, but it's happening

with every single Zillow and open door deal in my area, which is St. Petersburg. At the deal level, they are losing a lot of money on every single deal is I buying just one big advertising expense of these companies. Why would they do that? Do they need to show that they're actually like having transactions? I don't know. That's an interesting theory. I guess. And maybe this is making the case that they're lifting home prices. But I think that they're overpaying and then they're like, oh, shit, we just overpaid. We got to get our money back somehow. How about this? They can overpay a little bit because the margins on their deals is not requiring a 6% realtor fee. So back out a 6% fee. True. But if they bought a house and listed it five days later

for a $5,000 loss, that does sound a bit suspect. So he's a great example of their sheer in aptitude. I personally bought a house from Zillow in April for an investment property. So again, this person bought the house from Zillow. They bought it for 267, spent 15 to fix it up, so they're in it for 282, listed it for $2.93. So they're trying to make $11,000 profit. They cut the price half a dozen times. I bought it for $275K, four months after they listed it. So it sounds like Zillow lost $7,000 on that one deal. So this person bought it for 275, four months after they listed it. They also paid me $7K in commission since I'm a licensed, LOL, and gave me $7,000 in seller credits for inspection issues.

I closed in April 2021. I did $10,000 worth of work and rented it out. I just got this appraised for $375K, less than six months after buying it from Zillow for $275K. So I think to me, at least my takeaway, is that what Zillow is trying to do is not working today. Now, full disclosure, I bought Zillow after it was already down 50%, so I'm not sitting on a 60% loss.

And the stock is not working right now. And this is because right now, this I buying clearly from everything that I can gather is a shitty business today. My guess is this is probably the worst environment for it as well because it's a seller's market. So I was thinking about this like, I used this example in the past, but businesses can evolve and change, right? Just because Zillow and Open Door are not making the economics of this work today doesn't mean that they can't get more efficient than one day make it work.

Now, listen, that might not happen, but it also might just take time to get efficient in this. You're not going to like this business model until they start saying we're not going to charge title insurance. Then you're in. That's a fact. So, anyway, bringing it full circle, the real problem is that we do have an affordability issue in America. We really, really do. Do we? Yeah, we really do, Ben.

Nearly half of American households are burdened by housing causes from Cody, with 17.6 million households paying more than 50% of their gross income towards housing expenses. This is from the Wall Street Journal today. The median American household would need 32% of its income to cover mortgage payments on a median priced home. That is the most since November 2008. So, Ben, if you don't see an issue here, then I mean, seriously. Because look at the monthly payments. They are.

Okay. So in 2006, it was 40 some percent. To me, this looks like over the last 15 or 20 years, this looks like it's below average. Look at the average on that chart. Where are you looking at? Oh. Look at the chart. Does that look like it's screaming higher to you?

It actually does look like it's breaking out. I'm not going to lie. Okay, they're judging this from almost the bottom in 2008. Nearly half of American households are burdened by housing costs more than 30% of their gross income. 17.6 million households are paying more than 50% of their income towards housing expenses. I'm not saying that like it's a crisis and it's out of control and everybody's completely effed. But I think we have to recognize that housing affordability is definitely becoming an issue. I agree.

obviously going up 20% in one year is not a great thing. But I think when you combine it with low interest rates, it makes it easier for people to stomach. That's what I'm saying. Of course it does. But I think that the home price increases are offsetting the low interest rate. So again, bringing it back. Cody made the really good point. Or housing prices are going up because interest rates have gone down. How's that? It's a seesaw. But you're saying it like the sea saw is balancing. And I'm saying the seesaw is not balanced. It's still too expensive. Even with interest rates taking into account. I don't believe that. Okay. So Cody said the danger of seemingly innocuous posts going viral. Somebody tweeted like, Zillow is stealing our houses or Zillow is making everything affordable. Unite. And so the danger of seemingly innocuous post going viral is that they can come to be broadly accepted and woven into the fabric of our collective knowledge. So I think that there is definitely danger there. And this is the internet. This is what it is. Yes. I'm blaming BlackRock. I'm blaming Zillow. And they're still so small. Get them. Get them. So you and I disagree. You think think that there's nothing to worry about. And I'm saying that host... I don't say there's

nothing to worry about. Obviously, it's in certain areas and for certain people. It's gotten ridiculous and out of hand. But we talked about so, I think we talked about this in space as Bill McBride had the thing, that the affordability index, it was way worse than like 1980 than it is now. It's much lower. I adjusted it for inflation and interest rates right now. And even with the 20% increase, like, it's still not that high historically. What do we say? The average down payment for the median home is $12,000. I'm not saying that that's the same case for everyone, but I don't think it's as bad as some people are making it out to be. Fine, fine. I think a lot of people are getting royally screwed, like a lot of people, millions of people. How many people out

there, so two-thirds of the country owns a home? Right here, it says 17 million people are paying more than 50% of their gross income towards housing expenses. All right, what were you going to say? Well, I'm saying two-thirds of people already own their home. They've taken part in this 20% increase. So I'm just saying what percentage of people who don't own a home right now want to buy a home? Because I think those are the people that are screwed the most is first-time homebuyers. Yeah, a lot. I know a lot of them. So do you. You're using anecdotes yourself right now saying, I don't know what that pool of people is that want to buy home that can't. Well, I know a guy, so I'm just saying. Okay. Okay. I'm not trying

to poo-poo this. I'm just, is it really as bad as people are making it out to be? And is this really just, are we blaming HDTV because people are taking on houses that they shouldn't. It all comes back to HDTV. That I agree. I do think that housing affordability is definitely an issue for some people. I mean, I know it's, you know, how's this for a hot take from Mike Alfred. This is on Twitter. Paying off your mortgage used to be a badge of honor. Now it's a sign that you don't understand how money printing and asset price inflation works. The asset price inflation thing always kind of annoy me, but paying off your mortgage is a badge of honor? Is that something that with low rates all across the board is not going to be a thing for certain people anymore?

I know there's certain young people that still say, I hate debt. I can't stand it. Get me out of here. If people are locking in 3% interest rates on fixed rate mortgages right now, is that going to be a thing that is for a lot of people not a necessity as it was in the past to pay it off? as quickly as you can. I mean, this is anecdotal, but after we talked about our refi and hope we're not, like, influencing people to do the same. But I guess maybe we are, maybe we're not, we've got a lot of emails about people doing the same thing as us. I'm hearing tons of stories from people saying similar things that as a young person in rates so low, I want nothing to do with paying off my house right now. How about this? If somebody says to you, like, I just want to

be done with it just psychologically, like, this is my asset, this is my nest tag. I'm not going to say, like, I'm not going to talk them out of that. No, the counter argument that people always give us is no one has ever regretted paying off their home before. Interest rates have never been 3%. I'm saying, like, his whole thing about it being a badge of honor, maybe it's not anymore. I feel like of all the personal finance issues, like of all the topics, like to me, this one is the most, like, listen, whatever is right for you. A lot of stuff we could spreadsheet out and just say, well, actually, the math says this. But I feel like in this case, like, do what's best for you. The math doesn't matter.

Oh, this is interesting. So I don't know if there's any solutions out there for this type of problem, but somebody emailed us saying that the current housing market is broken for the freelance worker. So he said, I'm self-employed white-collar freelance worker 20 years of industry, pre-tax of $100,000 annually for most of that time. He has a six-figure cash down payment, well over the $20,000 down payment you pointed out is the industry average. Perfect credit score. Despite this, it's virtually impossible for me to get a mortgage.

Banks will just not loan to you. Freelancers make up 67 million of the U.S. workforce. And depending on these circumstances, many of these are locked out. Well, I feel like I'm turning into Michael Batnik because I have other sources of income besides what I get from my employer. And I'm going through a refinance right now. And the bank is being a giant pain to my ass about it. There are turds. They're being turds. I don't know if it's the regulations or what, but I'm on like week seven of multiple requests per week. And this isn't even a new loan. This is someone that I refinanced with multiple times in the past. I already have a home equity

line of credit with them. Was I exaggerating about how much of a pain in the essence is? I don't understand. They're going to lose me as a customer. Are you saying long Bitcoin short, the bankers? I'm saying if defy is going to take over the financial system, let's start with mortgages, please, in refinancing. Let me give a plug to this company. I don't know if they will help with the freelance worker, but I suspect they will actually. The company is called Upstart. And Dave Gerard was a guest on Patrick O'Shaughnessy's podcast, Founders Field Guide. Did you buy any chance to listen to this? Yeah, I did. It was awesome. It was freaking awesome. So they use AI to give loans, basically like they'll use algorithms that are predictive of some. somebody's income. So his co-founder, really bright kid, went to Yale, perfect credit, $100,000 job right out of college, and couldn't get a loan from anyone. And it's like, well, what an opportunity this is. Of course this kid is good for it. He's going to have a great income. And so they do that sort of a loan. So it strikes me that the freelance example is

right in their wheelhouse. But yeah, that whole process of refi of lending, it's so broken. I think I've already changed my mind about the fact that you said housing is unaffordable for most people because of a viral tweet here. Oh, you're back? This has gone on this weekend. I know a guy who lives in a three-bedroom apartment in Manhattan with wife and kid. Here's the estimate of their months of expenses. $18,000 mortgage, $2K, HOA. Pause, pause, pause, pause. $18,000 mortgage? Is this a joke what you're about to read? I think this guy was being serious. $3,000 for property taxes, $500 a month for parking, $16,000 a month for $247 nanny. This is a joke. This is a joke. 5K for food and entertainment, 2K for travel,

$46,500 a month, over $1.1 million of pre-tax income per year. He had some follow-up tweets. I think he was being serious. I could be wrong. Well, what was this point? That it's expensive to be rich? I think so. And of course, a lot of people pointed out the 24-7. But it's funny to me when stuff about budgeting goes viral, because I saw people all over-financed Twitter commenting about this one and saying, why do you need a 24-7 nanny? Hey, that's a pretty good life. You're spending $2,000 a month on travel, blah, blah, blah. This guy probably is trolling. I don't know. This seems like an outrage post. But let's say he's not. I bet if every person in America posted their monthly budget, you'd be able to find something on there

that you'd go, wait, why do you have that on it? That makes no sense. That's ridiculous. You don't need to spend that. You could do this. Or, why aren't you spending more on this? I just think the whole budgeting process for everyone, there's always something that you could point to that you go, this makes no sense. You're an idiot for spending money on that. Yes, agreed. Having said that, $16,000 a month 24-7 nanny, that's not a bad gig for nanny, despite the fact that you're working 24-7. What is that a year? $200 grand a year? Yeah, it's a lot of coin. Okay. You're right. If you live in Manhattan with a three-bedroom apartment and a wife and a kid

in a 24-7 nanny and you spend 2,000 month on travel and $5,000 on food and entertainment, it is impossible for you to live a good life in America. How's that? Unaffordable. It's ridiculous. I feel like this is a giant story that's getting attention, but maybe not as much attention as it should, about Eric Rosengren and Bob Kaplan resigned. their posts from the Fed? Why? Why what? I don't know. Why is it a big story? Because they resigned because they were caught with shady trading activity. My misrepresenting the story. As an insider, what do you think? I don't know. I think rich people will always try to skirt the rules. Like, obviously, the people in Congress doing insider trading and people in the Fed doing insider trading,

these people are all rich already. I just think they assume the rules don't apply to them. And rich people doing shady stuff just to me, I don't know. I guess it's not a surprise. That's where I fall on it. Nothing can shock me anymore from rich people doing dumb stuff. So I don't know. It's kind of funny because the headline, now listen, I'm outraged. I have to be honest. The fact that these assholes are trading stocks when they should be doing their job and they're already rich during a pandemic is completely morally reprehensible. Yes, I agree. Full stop. Like trading during their pandemic. How about you do your job and don't trade stocks? How about that? Counterpoint, everyone on finance Twitter was saying, it doesn't matter what the Fed does.

they can't stop a pandemic. Now, getting back to Cody's point about the danger of narratives. So on the one hand, we can say that they should not have been trading at all, full stop. On the other hand, we could say, let's be honest with what actually happened. Because the headline, not the author's fault, the headline was Clarita traded into stocks on Eve of Powell Pandemic Statement. And you see that headline and you're like, what? the hell. The statement, it's not like that he bought stocks before Powell was like, all right,

we're doing all of these emergency measures. The statement was on February 27th, where Powell said that the virus poses evolving risk to economic activity. And if you remember, in the same statement, Powell said the Fed was closely monitoring developments and their implications for the economic outlook. So that was like four weeks before the market bottom. So this person sold bonds, bought stocks before that, and I think it might have even been like a sort of, I don't know if it was rebalancing or mechanical. I don't want to make that claim. I forget what the article said exactly. But the point is, this person got wrecked buying stocks on February 27th. The market went straight down after that for three weeks. So on the one hand, he shouldn't have been doing

that. He should not have been trading stocks during a global pandemic. He should have been doing his job and not training stocks. Don't even allow the appearance of nefarious activity. But at the same time, the headline kind of sucks that he traded into stocks on Eiff of Powell, pandemic statement, insinuating that he made a killing. No, no, no, no. He got wrecked. Look at the chart. How about maybe for the people in Congress and the Fed, they're in some sort of blind trust or their strategy is completely automated or like something, something simple like that, where they just can't do anything active. Yeah, just sorry. If you're going to do this, yeah, you lose that ability. You lose the right to trade stocks. Dude, anchors on CNBC can't own

individual stocks, I don't think. Who has more influence? David Faber or the head of the Federal Reserve Bank of Boston? Is this nuts? And speaking of nuts, how come I can play daily fantasy sports on Draft Kings or Fandle or whatever the hell it is? I could do that, but I can't bet on the outcome of games. Explain that to me. It is pretty funny to me that New York is the financial center of the universe and you

can't bet on sports and you can't like own stable coins and you can't do crypto stuff. No, you can own stable coins, just not block file. You can do it through Gemini. How come I can own, seriously, I can bet on Daily Fantasy Sports. Somebody decided that was okay, that Daily Fantasy Sports are legal, but picking the outcome of games. No, no, no, no, that's over the line. You don't get to do it until you pay like a 14% tax on it. Like, it's going to come to New York, but you have to pay a 15% tax.

That's only fair, right? Nonsense. All right. We got an email from someone at Fidelity. We have a Fidelity insider in our email inbox who said, no, Ben, we are in crypto. You don't realize we custody for institutions. My point about fidelity and crypto, since they got back into it in 2017, they should have stepped on the neck of Coinbase and never let Coinbase get this big. That should have been Fidelity. Fidelity should have been Coinbase. And I shouldn't have shorted Amazon four times in 2011, but you live and you learn. That was my whole point, though. I thought Fidelity could have owned this space if they wanted to. And they didn't seem to want it. Or maybe they just didn't think it was going to get this big. But the fact that they were in it made me think they should have been the one that was well positioned to have to take Coinbase out and never let it get as big as they would. Okay.

okay, I had to make a pretty sizable withdrawal out of stable coins for something, five figures, not to brag. One of the things I've heard some people say with stable coins they're worried about is, okay, it's easy to get money in, but what if I have to get money out? So I had to make a pretty big withdrawal, and I thought, okay, is this going to be a problem taking money out? I'm going to have to do it in like five different chunks. Is it going to take two to three weeks to get the money back?

No, I did a sizable withdrawal from stable coins to make. at the Zach. And two to three business days hit my account. It was the same exact process as taking money out of Marcus for my savings account. Just not going through the process before, I was pleasantly surprised with how easy and simple it was. And it seemed to work for a decent size amount of money. And where did you take this money from? From the stable coins at BlockFi. And I moved it to my bank account. Two to three business days, moved a whole amount at once. Simple. I was pleasantly surprised at the experience. No issues. So stable coins aren't enough for you. You know, you actually sold your stable coins to buy Dogecoin at Robin Hood?

Is that what I'm doing? Bold strategy. The whole process was fairly simple for me. All right, survey of the week. It's been a while since we've done a bullshit survey. A third of U.S. customers who use Bynetat Pay Later services have fallen behind on one and more of their payments. And 72% of those said their credit score declined.

A new study published by personal finance company credit karma showed. You buying this? No way. Bine No pay later is like six months old. I know it's been a longer longer than that, but yeah, there's no way. I bought a can of spicy chili, like Sichuan chili flakes in the oil on Instagram. I'll let you know how it is. But I got an option to pay it from afterpay for installments of $3.12.

That's so bizarre. I don't get it. The thing that surprised me most about us talking about this is how many people in other countries say that it's already so highly used in their countries? I'm not walking back my fears or our potential concerns that people might get out over their skis. But it is interesting to hear from other people in other countries who say, listen, like, we view our income as 12 monthly income streams. Like, I know my income is a month and I know what goes out. And so it sounds like there's not massive problems in the rest of the world.

If there was going to be problems, irresponsible buyers, we probably would have seen it already. Now, that's not to say that it's not going to get bad in a recession. I guess that's kind of where the rubber might be. U.S. consumers say, hold my credit card. I think as far as consumption and spending goes, don't we have to be the best and the worst of the bunch? There's going to be a lot of people who take this too far. I think the U.S., if anyone can do it, it's us. That's what I'm trying to say.

I just don't know how people keep track of all of their spending with buy now pay later. At least with a credit card, yeah, you might get railroaded with fees, which is not cool. At least you know what you owe. If you're doing buy now pay later and you're just click, click, click, click, click, click, click, click. Like, how do you even know what you owe? Seriously. They're apt to aggregate all of your Boundatnaiplay later. purchases? I'm guessing not. The one that I used it for at first was Peloton. That made it easier

for me to buy. What was it? $2,500 for the bike? Maybe I can't remember. But it was worked out to $60 a month over four years. This Wall Street Journal article says that from April 2020 to June 30th of this year, Peloton signed up more than one million connected fitness subscribers, which is great. And I know some of their subscribers use different machines. They don't have to use a Peloton. They can just be a subscriber and use the classes. But they're saying there's maybe some fatigue. For the three months ending, June 30th, connected subscribers average 19.9 workouts per user a month, including bike and treadmill sessions compared to 24.7 during the same period last year. People aren't using it as much, they're saying. I still think this is a really

cool company that has some legs. My biggest worry has always been with companies like this, how much of it is a fad and timing. That's just my one concern. I think that Palaton has brand recognition. And I'm not surprised to see the numbers down you over year given where we are in the pandemic cycle. People want to get outside and go biking. Well, and like how many people sneeze and throw their back out and can't use the Peloton? That's got to be like three or four people in the whole country. I haven't been on the bike in a while for obvious reasons. I'm getting better. Yeah, I still think there's a lot of things that Peloton could do, even if it makes sense that we've buying pressure a slowdown, obviously. The bull case for them would be brand recognition.

The bare case for them would be literally every company in this space over time has been a fad. Let me give a plug. By the way, you know what's interesting? If you had to say which stock was the poster child of the pandemic? Zoom. Boom. That's what I was going to say. Okay.

So Zoom is now, I mean, it looks horrible. Zoom is now at $256 a share down from $590 at the peak. So Zoom is down 57%. And maybe this is an example of... By the way, kudos to you for still having. a calculator on your desk. Is there a CFA calculator? Okay.

Use it all time. I threw mine away. So what we are going to be doing starting next year is we don't know the exact format, but we're going to be doing quarterly podcasts of the most interesting data points from different earnings reports. And so there's a company that Ben and I use that we've invested in called quarter, Q-U-A-R-T-R. And we've spoken about this before.

but it's an app where you can listen to the earnings call, you could fast forward to the pre-labeled garbage script, go straight to the Q&A, and you can hit the PDF all inside your phone. Yeah. Going through some of these, we just realize there's so much information that is potentially being missed from these that we want to kind of aggregate it all and try to do it in podcast format. So we'll let people know when we get closer to that. I am very, very curious to see to keep an eye on Zoom because the rise and fall. I mean, what did I say?

It's down almost 60% from its high. All right. So I got Zoom down 55%, Zillow down 57%, Peloton down 51% as of right now from the all-time highs. Let's be clear. Those are full-blown crashes. Teledoc is down 59%. Teledathe's another one. I have no opinion on how low these stocks can go, but we lost the script a little bit with the market being so close to the highs for a long time that nobody was paying attention to these stocks that were getting blown up. And I'm not saying that we should have seen this 5% correction. coming. I'm only making the point that in a bull market, a lot of the stuff like this just falls by the wayside. People just don't pay attention to it. Even though some of these were the most favorite stocks for people to own last year. They rotated out of this into NFTs. Is that what happened? Probably. So last week we talked about how there's no distinct fashion for the 2000 to 2010.

Some people gave us some ideas. A lot of people said hipsters and yoga pants. But I mean, I don't see those at a party being a big. So someone sent us. I stand by my call. You definitely wore a visor. I'm positive. No, no, a visor? I'm not like a high school football coach. What do you? Why would I wear a visor? Well, like upside down back, like Jamie Kennedy. No, sorry. So someone sent us this explanation from Paul Scalas, who writes at the Lindy newsletter. And he said, he thinks the explanation is the explosion of social media and distributed culture. He said between 2004 and 2007, we saw the rise of Facebook, YouTube, Twitter, Netflix. Suddenly people no longer took their cues from MTV, the Academy Awards are Rolling Stone. Almost

over and up, we went from an environment where ideas spread from the top down to the bottom up. Nowadays, influencers on TikTok and Instagram are far more influential than tabloids or any single media outlet. Interesting. And I guess Andreessen said the same thing. I buy that. In the 50s and 60s, we had like this centralized media stuff, a few channels. And now we have all these different. I never really thought about the internet having a piece. I wouldn't even know to this point. Who are the influential pop stars that are influencing how people dress and how people think and what people say? You're asking the wrong guy here. I know. Taylor Swift and Bailey Ilish and that sort of crowd.

But, I mean, I didn't think they have a way of dressing or something that even really gets people to follow their fashion sense anymore. You look pretty good today. Nice shirt. Thank you. New will. All right. Peter Malook tweeted a target date fund swerve that was terrible and caught a bunch of criticism.

But the broader point was that given the current interest rate environment, the typical allocation of bonds and target date funds is too high, which I think is actually legitimate question and interesting to consider. Yes. So do I. Question. I'm pushing 40. My TdF is 90.

seems about right. Do you have any sense about broader allocations across different vehicles and whether they tend to be too conservative with regard to the body allocation? I really feel like we're splitting hairs here. The difference between a 90-10 allocation and 100-0 historically has not necessarily moved the needle on your ability to retire or not. Here's what's going to happen to the next 19 months, call it. One of these companies is going to say we're increasing all the allocations to equities by 5%. And then all the other ones will fall in line. How about this? What if there was a leveraged target date fund, a la the 9060 portfolio from Wisdom Tree? It's actually not a bad idea. It's actually a really good idea. Did I just think of something?

Well, I mean, the fund exists already. But yeah, so you'd have a glide path from, yeah, I could see. So you have a glide path down from the 9060 and it eventually gets to an actual, okay. I feel like from a fiduciary standpoint, that wouldn't pass the test. But I feel like we're a better place to take leverage in your portfolio than inside of a target date fund. True. That can rebalance. All right. Recommendations. What do you got, Ben? Do you want to do Squid Game now? Sure. I'd love to hear your take. Did you finish it?

I'm only halfway through, but I thought when I started watching this, after episode one... I'm very curious to hear your take. I feel like this is not your cup of tape, but maybe I'm wrong. I almost gave up after episode one, and I thought, oh, okay, the thing that kept me going is the violence is so gratuitous that, like, it feels like a Quentin Tarantino movie. Like, the blood and stuff is so over the top. It doesn't really feel that real. I think that the human nature, human psychology aspect of the show really gets me like thinking through incentives and what would cause people to do crazy stuff. I also think if these people would have just taken a personal finance class in high school,

all of this could have been avoided. They wouldn't have had to go through the game. I can tell why it's the more you watch it, the more you want to keep watching to see what happens. I feel like it was two episodes too long. They spent a little bit too much time on the character development for my taste, but I was shot how they really pulled it off. Like, I thought that the production was incredible. Even though it was too much character development, the characters were great, the acting was superb.

I get why it's the biggest show. Oh, I don't know if Tetzaranda said this. Somebody says, it might end up being Netflix's biggest show ever. That's pretty crazy. And it sounds like for years this show couldn't get off the ground because people thought it'd be too unrealistic. It's like, guess what? Unrealistic stuff is people don't mind if something unrealistic, if they can turn their brain off and just enjoy it for entertainment. I got to say, that's a little bit of a pet peeve of mind.

Somebody critiquing entertainment for not being realistic. Like a friend of mine was talking to me. I figure what we were talking about some show. He's like, it's so unrealistic. I'm like, well, who cares? It's not documentary. Isn't that kind of the point you're trying to entertain yourself? The Fast and Affiris has, what, 10 movies?

Every single one of them more ridiculous than the one before. But I don't know. You have to go into it without understanding. It's not a true story. What else? Anything else? I'm back on reading again. Davis Dynasty.

That was a V-shaped bare market. That was very quick. This is a book from like the 19, late 1990s, I think, early 2000. It's called the Davis Dynasty, 50 years of successful investing on Wall Street. You've heard of like the Davis family of mutual funds before? Yes. I guess someone wanted to write a book on the guy who started that. Christopher Davis, I think it is his name.

How did this get to your inbox? Someone shared the story with me, and I think I might have posted the substack that they did a big sort of review of it. And it's about this guy, Shelby Davis. He was like, the guy said, you don't want to write a book on me. You want to write a book on my grandfather. He's way more interesting. He turned like $50,000 and invested in insurance stocks found the Great Depression, and he turned it into $900 million. And it was basically like him and Buffett were the only two stock pickers that made it into like the Forbes 400 list.

Everyone else had just like had equity from a business that they started. The problem was like, this guy was a total jerk. That's the interesting part about it is he was frugal. He wanted to like screw his own kids over out of money. But it also has some really great history stuff from like what was going on in the Great Depression. And so there's a lot of good market history stuff in here that I hadn't seen before. Here's, by the way, we talk about things that get started when times are bad. Like we're going to have all these great companies start out of the ashes of the pandemic.

Oh, hang on, hang on. We almost wrote a book. We thought about that, didn't we? We almost did an audio book where it was just going to be podcast format. We were going to do chapters in the same format as a podcast. The working title was out of the ashes. And we were going to highlight companies that were born in recessions. And there's a ton of them.

The problem is it's too much work. Yeah, we didn't want to do it. Here's one from 1932, which is like the depth of the Great Depression. Zippo lighters, Friddle Corn Chips, Skippy Peanut Butter, Three Musketeers, Candy Bars, and Revlon all hit the shelves in 1932. Maybe we should do the buck. Pretty interesting. Yeah, that's all I got. By the way, Squid Game is so good.

I wanted to watch the Sopranos movie and some other shows, and I put them all in Backburner to watch the Squid Game. Wait a minute. You just said Squid Game is so good. I didn't realize that you like, okay, you fall on indoors. Yeah, it took me two or three episodes and I'm like, okay, I'm into this now. We're watching this exclusively until it's done. We're binging it. I'm excited to hear your full recap because I really think they did a great job with the ending. Okay. So I saw, is it many Saints of Newark? Is that the title?

I think so, something like that. Okay. I made it three seasons of Sopranos and it was too slow for me. I'm not in any way denigrating the show. I wish that I saw it in real time. I just didn't. So I had some background. So it wasn't completely foreign to me. I liked it. I heard a lot of criticisms. I understand the criticisms, but I really enjoyed it. I'm trying to ignore it all. No, it didn't get panned, but some people just didn't really love the story. I found it thoroughly entertaining. And it's funny because I saw this after I saw No Sudden Move, and they felt similar in the

sense that they were both gangster-ish movies from the 50s, 60s. No Sudden Move was a Soderberg movie that came out on HBO max probably two months ago with Don Chita, Benicio del Toro, Kieran Colkin, a great Matt Damon cameo. I watched it, and I fell asleep after like 20 minutes. I probably watched it when it came out. It is a little bit slow in the beginning. It's one of those rare movies that the second half was way better than the first half. Okay.

I gave up on a halfway through. Okay. It wasn't great. I liked it. I remember this. It was filmed and I kind of thought my eyes were bugging out. I was like, what the hell is going on? But it was deliberate.

It was filmed with like an old-fashioned type camera. It didn't matter that you hadn't seen the rest of Sopranos to appreciate the movie. Nope. Okay. Having some background, knowing who Jr. was, for example, like that helped. I thought it was definitely well done. Lastly, I rewatched The Matrix. I haven't done that in a long time.

And I forgot in the first scene where Trinity, like, runs on the walls and does all that CGI stuff. That was like the beginning of crazy graphics on the big screen that we had never seen before. That was the biggest part of the movie I thought is just the stuff that they did had never been done before. So there's a lot of really memorable scenes. I feel like this is like ridiculous to even say it's a good movie. Of course, it's a good movie.

Not my favorite movie, but holds up very very very. very well, I thought. Yeah, not bad. What do you mean not bad? Not a fan? It never did it for me in like a fanboy sort of way. I was always kind of like more of an admirer of the technology that they used in the pop culture aspect of it, but more than the movie itself. So you were bullish on the blockchain, but the coin was neither here nor there. Yes, pretty much. All right. Animal Spiritspod at gmail.com. We will see you next time. Thank you. Thank you.

Thank you. Thank you. Thank you. Thank you.