The Best One Yet - 🧃 “Hold the caffeine” — Four Loko’s return. Europe’s military stocks. Warren Buffett’s fave biz.

Starting point is 00:00:00 This is Nick. This is Jack. It's Thursday, the new Friday, March 6th, and today's pod is the best one yet this is a T-boy. The top three pop business news stories you need to know today. Did you get your birthday spaghetti, Jack? Did you get it? Yes, although it was controversial. My mother-in-law made me spaghetti meatballs like I asked. Nice more. And then she realized yesterday was Ash Wednesday. Okay. Eating meat was a sin. Didn't realize that. Good thing she's got Sunday confessions, though.

Starting point is 00:00:29 Three stories for today's tea boy, Jack, what do we got on the pot? For our first store. For Loco, the notoriously high alcohol and high caffeine party drink, is having a renaissance. For Loco used to be a lawsuit in a can, but now it's having to come back, and we will tell you why. For our second story, it's shocking news from Wall Street. Europe's stock market is outperforming America's stock market since the election. Because Europe's new growth industry is national defense. And our third and final story.

Starting point is 00:00:59 Warren Buffett just wrote a tribute to his favorite CEO of all time who passed away last year. This guy drives RVs, he doesn't own a computer, and he sold his company to Warren Buffett after sending him a fax. A cold fax. But yet he's, before we hit that wonderful mix of stories. What a fantastic mix of stories. Love the mix of you. Best selling board game of all time hath disrupted itself. It's the biggest change in the toy industry since Elmo got tickled. Get this, Yates. Monopoly just launched a fintech version of the famous board game.

Starting point is 00:01:33 FinTech Monopoly. It's actually called Monopoly app banking, and it's a BIO phone situation. So the famous Monopoly money, it's gone. You must use the Monopoly app instead. If you want a loan from the banker, that's gone too. You must apply online instead. Now, there's still a physical board, and there's still physical pieces that you move around the board. But the rest of this Monopoly game is basically Venmo. Honestly, I kind of love the idea. Because you get to play Monopoly, but without having to keep organized, that unruly stack of colorful monopoly money.

Starting point is 00:02:04 And Jack, the banker is the app, not your little sister who you can't trust, not to cheat on the whole thing. It's like Jack Dorsey became Mr. Monopoly and added a square dog. It feels like a VC is behind this new monopoly, Jack. By the way, the game has the same goal. You take over the board via ruthless capitalism. But the game has different means. Pro tip, get a Coinbase account if you want to buy Illinois Avenue. So, Yadis, the newest monopoly is actually.

Starting point is 00:02:26 Actually, a digital banking app. Because in this economy, even Monopoly is trying to cut some expenses. It's a SaaS company. Savings has a service. Jack? Let's in our three stories. Fifteen years before this song, two boys from the Northeast met in the dorm. They had an idea to cause a cultural storm.

Starting point is 00:02:45 It's the best one yet, but the best is a norm. Jack Nick, that's it. I don't even think they need to practice. 50%, that's a fat tip. Tea Boy City on your at list. If you know, you know, because we're ready to go. We can't wait no more, so just start the show. First, a quick word from our sponsor.

Starting point is 00:03:09 For our first story, Four Locos, the craziest alcoholic drink ever, is having a shocking renaissance. Four loco sales are surging again because of one ancient Japanese proverb. But yet is, for various reasons, we have shared with you on this podcast. Alcohol sales are down in America.

Starting point is 00:03:40 First, OZempe makes people crave alcohol less. Second, legalized weed is replacing alcohol sales. And third, Gen Z, they're just not that into drunkenness. They're hitting snooze on the booze. But there is one alcohol brand that is surprisingly up. And it's For Loco. Or as Jack and I like to call it, Quatro Crazy. Okay.

Starting point is 00:04:01 Sales of Four Loco are up 64% in the last five years, and it's now the top-selling maltloca. liquor in America. Could you pour on some context for us, please? For Loco is the first drink ever to combine caffeine and alcohol and put it in one product. It's basically like a Red Bull Tequila Coffee cocktail. Invented by Ohio State grads back in 2005, it's 12% alcohol by volume, which is why they called it a blackout in a can. That at Sig Sig Sig Epp. Now let's talk the numbers here. 24 ounces in a can with 12% alcohol. Nick, it was a huge can and it contained the same amount of alcohol as six bud lights, plus a couple red bulls. And that's why I was only sold in

Starting point is 00:04:43 gas stations where the fake ID was easiest to use. When Nick and I were in college, this product was notorious. Because it sent co-eds from zero to 60 and three point four gulps. Four loco was the big man on campus until 2010, when it got banned nationwide. Four loco was forced to remove caffeine because of lawsuits and their sales started slipping year after year after year. Because the caffeine plus the alcohol in one can for like three bucks at your local gas station. Once they removed the caffeine, it didn't have the appeal. But here's the news. Fifteen years later, Four Loco has been resurrected.

Starting point is 00:05:20 Again, sales are up 64% since 2020. Jack, Four Locos sales are even up 20% internationally. The French are trading Pino for Four Locos. I guess you're right with the whole Quatro crazy thing. I think we're on to something here. But yet he's the wildest part about Four Locos' success, it's that it's targeting the smallest possible audience. Forloko says they're targeting Gen Z,

Starting point is 00:05:43 not nostalgic millennials like Nick and me who remember it from college. Here's an interesting business model distinction. Four Loco isn't distributed to restaurants and bars like every other alcohol is. Because the concoction is simply too crazy for the Olive Garden. I don't think their insurance policy would cover it. So if you're only targeting Gen Z and you're not selling to retail drinking establishments, then... Four Loco is only targeting like a two-year-oldo.

Starting point is 00:06:07 two-year age group. Yeah, college juniors and college seniors. Because you can basically only drink four-locos when you're on campus. You're not going to order a four-loco at the analyst dinner with your boss at the table. And yet, that demo of 21 and 22-year-olds buying at their nearby college bodega, that is a high-volume customer segment. Apparently, it's a high enough volume population that four-locos sales are up 64% to become the number one malt liquor. Those numbers are so good. You don't need to hide it when public safety. safety knocks on the door. Excuse me, nothing in here. They're watercups. But besties, there is actually one product change that Forloko made that's actually deep.

Starting point is 00:06:46 We're about to pivot from Forloco to philosophy. So, Jack, what's the takeaway for our buddies over at Four Loka? Four Loco practices the Japanese art of Misagi. Yiddis, Misagi is a Shinto tradition in Japan. It was actually once practiced by the ancient samurai. Here's the concept. You should strive to do one hard new thing every year because focusing on one challenge makes it more likely that you'll succeed and it unlocks growth. Well, For Loco does this. They actually introduce one major new flavor every year and then they build hype around that one flavor for the whole year. The CMO of the company recently said that they've seen maximum

Starting point is 00:07:27 impact with their one flavor a year focus. This year, that flavor for For Loco is camouflage for 2025. Like, the whole marketing budget of Forloco is Camo for loco. It's less of flavor and more what the can looks like, right? Just roll with it, Jack. Just roll with it. Now, Vasty, that's singular focus. It gave the company clarity and it gave consumers clarity. And it's having the same impact as the Japanese samurai would have wished. Misoki, unlocking growth by committing to one big challenge for the entire year. For our second story, there's only one sector of the stock market booming right now. And that sector is European defense stocks. With the U.S. withdrawing from Ukraine, Europe is arming itself. And there is huge money in that.

Starting point is 00:08:19 Yeties, let's start by sprinkling on a little bit of history. Since the end of World War II, the United States became the de facto military for the whole democratic world. But with the second election of Donald Trump, that era is officially over. Yeah, you saw the news this week. The United States paused funding for Ukraine to defend itself from Russia's invasion. Which means that Europe has to defend itself against Putin without America's help. It's not just politics, it's also money because the United States is also prepped and tariffs against the European Union. Which is going to raise prices in Europe and hurt Europe's exports to the United States.

Starting point is 00:08:54 Pardon my French, Jack, but add it all up, and that sounds like terrible news for the entire continent of Europe. It's bad news for France, Germany, the Spanish, the Brits. Of course, the Ukrainians. But Yetis, this is what Jack and I found fascinating about this story. It leads to a hero stat you will not believe. European stocks are up because of all this. Sit down, stand up and watch the stocks again.

Starting point is 00:09:19 Because U.S. stocks are actually flat since the November 5th election. Europe's stocks over the same period are up by 10%, which is the best in the world. The index of Europe's 600 biggest stocks? It's up 10% since President Trump got elected. and started pulling things away from Europe. And one sector in particular is driving all those gains in Europe. Defense companies. European defense companies.

Starting point is 00:09:44 Yeties, in America, we got Northrop Grumman, Raytheon, and Lockheed Martin. They are profit powerhouses. Those American companies are making the rockets, the grenades, the fighter jets that America and other countries buy. But now, Europe needs to build its own weapons of war based on what Trump has done with his foreign policy. European grenades, European fighter jets. You thought it was not possible?

Starting point is 00:10:06 They got to make it possible now. They got to DIY their own dynamite now. Yeah, they need to basically Bob Villa their own rockets. That's why Germany's Ryan Mattel and Italy's Leonardo, two defense stocks over in Europe, have both more than doubled since Election Day. Across the channel, England's Rolls Royce and B.A.E., well, His Majesty's defense stocks are up 45 and 30% this year.

Starting point is 00:10:29 Because a whole bunch of European militaries are about to send those companies a whole bunch of new. orders. Now look, maybe President Trump changes his mind and the United States resumes funding for Ukraine's European struggle. That's definitely possible, but honestly, it does matter. Europe sees that they can't depend on the U.S. for security against Russia anymore. That bridge has been burned. So, Jack, what's the takeaway for our buddies over in European defense? America's Europe retreat could ironically be the best thing for Europe's economy. Yet is Europe's missed out on tech trends.

Starting point is 00:11:06 Europe's car companies, they've lagged behind. And productivity over in Europe, the numbers show it's weak. And the result is that for decades, the EU economy barely grew, which actually led to civil unrest and a whole bunch of political upheaval. But then this week, the head of the EU unveiled a new plan to invest $840 billion in defense spending. Almost a trillion dollars in military orders, that's huge economic stimulus. And then, Jack, did you see that Germany's new chancellor announced $500 billion on non-defense spending this week, too? Almost one and a half trillion dollars of spending is the response to Trump's Europe retreat.

Starting point is 00:11:44 Besske's Jack and I were trying to think of like an analogy here. This is like America ripped off the warm, fuzzy blanket that it's offered Europe since 1945. And instead of being scared about that, Europe is stepping up and weaving their own blanket. Yes, they are spending big to protect themselves in a post-America Europe. Now, there is one big question to watch. How is a very indebted Europe going to pay for all this? Totally fair question. But in the meantime, Europe is more united than ever.

Starting point is 00:12:10 And rearming is its biggest economic stimulus in decades. Now a quick word from our sponsor. For our third and final story, Warren Buffett just revealed his favorite CEO of all time. and it's a guy who made them billions of dollars. The guy is crazy, though. And he runs a random RV company. You definitely didn't expect this, besties.

Starting point is 00:12:38 But you should know, by the way, Yeti's that when Warren Buffett talks, Jack and I grab a pen, a paper, and a copy machine, and then we call each other up. Last week, he spoke. Actually, Warren wrote. Good point, Jack. He wrote his annual shareholder letter for Berkshire Hathaway, so Nick and I read it. He read the whole letter. And honestly, the best story that we found in it, what was it, Jack?

Starting point is 00:12:57 20 years ago, out of nowhere, Warren received a letter with a specific proposal. That letter was from a man named Pete Ligel. This guy wanted to sell his recreational vehicle company, which was called Forest River, for $800 million. One week later, Warren met Pete in Omaha, Nebraska. And the guy said that he believed in his RV company. He wanted to keep running it, in fact, but he also wanted financial security for his family, so he was looking to sell it to get some cash.

Starting point is 00:13:24 So Warren, the greatest investor in the whole world, asked Pete to name his salary. And whatever Pete said, Warren would accept it right there. Pete said $100,000 plus 10% performance bonuses. The two shook hands, signed papers, and the deal was done in just one week. Now, Yeti's Pete, the RV entrepreneur, passed away recently at the age of 80, and that's why Warren wrote about him in his annual shareholder letter. He continued working for Forest River, which is now owned by, by Berkshire Hathaway, right until his death, by the way.

Starting point is 00:13:57 But what Warren Buffett didn't know 20 years ago is that Pete Lytle is actually the George Washington on the Mount Rushmore of recreational vehicles. Because Pete's company, Forest River, which was founded in 1997, they sell RVs and campers the size of a tank, plus they do pontoon boats for sipping marine margaritas during some batch parties.

Starting point is 00:14:18 Jack, did you know there is an RV Hall of Fame? Oh, the Mount Rushmore of RVs? No, no, like there's an actual hollowo. Fame. And he was inducted into the Hall of Fame 10 years ago. Well, this RV company does $6 billion in revenue today as a subsidiary of Berkshire Hathaway, which happens to be the same amount as Ferrari. And this RV company's growing 10% a year. But Pete, Warren's favorite CEO ever was also the craziest CEO ever. Okay, get this, besties. Every year, Pete Lytle would take his family to Disney World for a nice casual spring break vacation. But he insisted on taking one of the

Starting point is 00:14:52 company's RVs for that 17-hour drive each way. He wanted the whole family to understand the ins and outs of his product. But during the trip, he would not let his wife or kids use the bathroom or the shower on that RV. Because it's a company vehicle, and he intended to sell that vehicle after they got home from Disney World. Plus, he's pretty old school. This guy had no computer and no email. He just never used either of them. He was the ultimate founder mode founder. He had his fingerprints on everything the company did. Okay, at one point, He went into the dumpster outside their office and measured it inside the dirty trash cans to make sure they were paying a fair price for their waste management bill.

Starting point is 00:15:32 What did he find out? The cubic volume of that dumpster was smaller than what he was paying for. So he demanded a refund. So best he's added all up and we were curious. Why do Warren Buffett buy the $6 billion recreational vehicle business in just one week with a single meeting? Because of six things. Six keys.

Starting point is 00:15:51 So Jack, what's the take? for our buddies who are following Warren Buffett. Warren Buffett uses six criteria to evaluate a company in just six minutes. Yeties, when Buffett buys a company, there are six criteria that it must pass, and these are the six. It must have consistent profitability, one durable, competitive advantage, and be offered at a fair price. It also must have a honest management team in place, low debt, and be, most importantly,

Starting point is 00:16:19 simple to understand. Warren Buffett's not. not interested in Enron. The Wi-Fi connects to the Bluetooth. The world's most famous investors, most favorite investment ever fit all six of those criteria. And those same six criteria are what guided Warren's other investments into Coca-Cola, Apple, and GEICO as well. It's a reminder how investing can be simple, if done thoughtfully, and quality, if done consistently. So besties, Jack, and I want to know, what are your six keys to decide something in just six minutes? Hit us up in the comments.

Starting point is 00:16:52 Jack, can you whip up the takeaways for us for the new Friday? Four Locco has made a comeback. It's the top-selling malt liquor in America, even with no caffeine in there. Because For Loco practices Misogi, setting a goal to do one big new thing every year. For our second story, with Trump signaling less American support for Europe, European stocks have actually soared. America's Europe retreat could ironically be the best thing for Europe's economy. And our third and final story was Warren Buffett. He basically eulogized Pete Lytle, a crazy RV entrepreneur whose company he bought. Because Warren has six criteria that he uses to evaluate a company in six minutes.

Starting point is 00:17:36 But Yeties, this pod's not over yet. Here's what else you need to know today. First, yesterday, we told you the story of the new U.S. tariffs using a single car, the Chevy Silverado. Well, Trump might have been listening because yesterday, he announced a one-month exemption of the North American tariffs, specifically for car companies. The S&P 500 jumped 1% on the news yesterday, hoping that trade war two may slow down. But it's another example of policy whiplash. Policy whiplash.

Starting point is 00:18:05 For our second story, FIFA, the World Soccer Organization, is planning a new halftime show to rival the Super Bowl at the next World Cup. By the way, the World Cup's coming to North America in 2026. And for the final, which is at MetLife Stadium in New Jersey, on July 19, 2026, they're going to turn the halftime, which I don't think it's called halftime in soccer. I think it's called like, Yellow Card, Jack, yellow card, you took too long. Well, anyway, there's going to be a concert that rivals the Super Bowl halftime show. No word yet on who the artist is, but whoever it is is going to have the biggest stage in history.

Starting point is 00:18:38 And finally, HBO is bringing Harry Potter to the small screen. You know that there's a 10-season TV show coming to HBO Max. But the newest news? Who's playing Dumbledore? Who do they got, Jack? It's actually going to be an American. John Lithgow is playing Elvis Dumbledore for 10 seasons of Harry Potter. John Lithgow, the only American capable of playing a Brit.

Starting point is 00:19:02 Now, time for the best fact yet. This one is a correction from Yetty Tim Mueller over in Adina, Minnesota. The clarification is, how many strikes in a row do you need to get to bowl a perfect 300? A 300 game is something that a Yeti did the other day and we gave them a shout out. And what does that mean? And I asked, I was like, what is that? 10 strikes in a row. It's not a correction.

Starting point is 00:19:23 I asked the question. That's true. It was a question mark at the end of it. I saw that, Jack. Well, a 300 bowling game means you through 12 strikes in a row. Wow.

Starting point is 00:19:32 One per frame, one through nine, plus three strikes in your 10th frame. And Nick still never made a turkey. He doesn't even know what a turkey is. I know is every time I'm eating the chicken fingers,

Starting point is 00:19:44 my hand doesn't fit in the ball anymore, man. Are those pins in regulation size or what? Yet is, you? look fantastic today. And if there's one thing that Jack would also like for his birthday week, it's for you to ask your buddy, H-Y-H-T-B-O-I, and send a link to this episode. If you know, you know, and then give us five stars because we love reading each and every review. Nick and I, we'll see you tomorrow. Stocks are up for Jack's birthday, and we'll see you there. Before we go, a congratulations to Yeti's Luis and Maria down in Austin, Texas,

Starting point is 00:20:19 who just welcomed their third child, and Luis Jack, he's been listening for years. Congratulations to and Maria. And a shout out to Emma Foyer, a power listener and the entire integrated marketing communications crew over at Northwestern University, those wildcats are Yetis. Happy work anniversary to Walter Thurmond from Tucson, Arizona, who's been working 25 years at Raytheon, a company we mentioned earlier in the show. And a congratulations to Savannah Westwood. Happy professional pet sitters week. You're doing a fantastic job with all those P-U-P-P-I-E's. Happy 40th birthday to Bruce LaRario in Connecticut. And Rachel Brock's turning 40 years old in Courtsdale, Idaho. She's got three baby eddies and the best husband yet. This is Jack. Nick and I both own stock of Apple,

Starting point is 00:21:09 and I own stock in Berkshire Hathaway.

The Best One Yet - 🧃 “Hold the caffeine” — Four Loko’s return. Europe’s military stocks. Warren Buffett’s fave biz.

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