The Best One Yet - 🎮 “Playstation on Wheels” — Sony’s 1st car. Krogertson’s $25B grocery run. Cathie Wood’s lost Ark.

Episode Date: October 17, 2022

The 1st tech company to release a car will *not* be Apple — It’s Sony. Cathie Wood’s legendary ARK fund just hit a major milestone that screams “Do Less.” And Kroger and Albertsons are merging into a mega grocery store for $25B, but the real story here is Walmart.$SONY $HMC $KR $WMT $ARKKFollow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypodAnd now watch us on YoutubeWant a Shoutout on the pod? Fill out this formGot the Best Fact Yet? We got a form for that tooLearn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. Welcome back. It is Monday, October 17th, and today's pod is the best one yet. Welcome back, besties. We served up a T-boy. It's a T-boy, Jack. What's your podcast of choice?

The Nogroni. Best. Spagliato. One. With Prosecco in it. Yet. Splendid, Jack. What's our first story?

Yet he's the first tech car. It's not going to come from Apple. No, it's not. It's coming from Sony. Sony and Honda are building a PlayStation on Wheel. For our second story, we're looking at Kathy Wood of the famous Ark Fund. It's one of the best stock pickers in the world. Her eight-year record is now the exact same as everybody else, like everyone else, including us.

Our third and final story is Kroger and Albertsons. They're merging into one of the biggest grocery stores in the country. But the real story is neither of them. It's actually about the biggest grocery store. But Yeties, before we hit that terrific mix. Just a perfect mix, man, to start a week. We're opening it up. Porter's Omnack Week 133.

Things were running at it because the pandemic, Jack and I have been keeping track for you. Yeties, call Homaker and Schlemer because this week we're running low in Birkenstocks. We are literally out of Birkenstock shoes. Like, we can't find them. We don't see them. The classic German-made clogs since way back in 1774. Things are older than America. They were using cork before Bieber ever touched a crock.

200 years before Bieber touched a crock. But get this, Yeties. The New York Times says that the $160 car. Classic Birkenstock sandal. It's out of stock. Specifically, the Boston variety, the full cover clog, they are nowhere to be found. Sit down, stand up, and stub a toe again. This is the only shoe that looks like a potato. Yeah, it's like a later hosing for your left foot. Online, offline, in-store, second-hand. These clogs are nowhere to be found. Apso facto, the burke and stock is out of stock. Now, we looked into this.

We did. And it's partially out of stock because of the comfort economy. Like you sold your stilettos and you slip into something a little more casual. But it's also MIA because of some horrible horrid. You worried Birkenstocks would sell out so you bought up. Makes sense because the Germans are famous for buying next year's Christmas present the day after this year's Christmas. They're very fast, very machinsey-Schnell. Now if you want to pay for some Birkenstocks, you're going to pay three times the price on eBay. Now the way we see it, if you've got Birkenstocks, that's not just a 300-year-old shoe under your foot. Yeties, that is not just a clog that. Is that an investment?

This is Jack. Nick and I both own a pair of Birkenstocks. And those Birkenstocks are outperforming both of our stock portfolios. Thanks for the dividends, Wolfgang Fun Wolf and Stalkin. Let's slip into our three stories. Fifteen years before this song, two boys from the North East met in the dorm. They had an idea

that caused a cultural storm. It's the best one yet, but the best is a known. Fifty percent 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. Start the show. For our first story, the first ever car made by a tech company is coming, and it will be made by

Sony. Not Apple. Sony. Sony and Honda are teaming up for a PlayStation on wheels. But yeties, we know what you were thinking, because we know what you were thinking. What's the ETA on the Apple car? The ETA and that Apple car. TBD.

Yeties, they've actually never explicitly confirmed that they're working on an Apple car. Tim Cook's like, uh, yeah, they think we're working. on an Apple car. Can you believe they still think we're working on an Apple car? Hey, Yetis, if you work at Apple and you're working on a car, cough twice. The Apple car, best lie, Silicon Valley is never told. In the meantime, Yetis, Sony did tell us something yesterday. They told us, hold my smartphone, we're going to make our own tech car. Sony and Honda just got together two of Japan's finest publicly traded companies

teaming up for the first ever tech car. These two Japanese companies just announced, a 50-50 joint venture, and together they're going to make a car. And it comes to the United States in 2026. It's going to take a few years because it takes a few years to make a chassis. It does. And Honda's going to bring the muscle, the hardware car chassis muscle. Exactly. What's Sony bringing Jack?

Sony's bringing the software, the engineering, the coding, the technology. Exactly. The SAT score. In the meantime, Jack and I are looking at this and we're like, uh, feels like a missed opportunity, Sony and Honda. Where's Nintendo? Get the third biggest Japanese company. on board. Do a 33, 33, 33 deal and make it a true Mario card.

Oh, one second. I don't need to fuel up. I need to put some mushrooms and banana peels in the back, Jack. America, we give you the Cooper Trooper. It's a me. But, ladies, here is the funny thing, Jack, and I noticed about this new Sony car. This kind of is a Mario car. It kind of is a Mario car. We're looking at this thing, right? Jack, what's going on here? The Sony car, we saw pictures of it. It's a PlayStation on wheels. They're calling this joint venture a mobility tech company. It is a tech company, but it is on wheels. Yeah, they showed us pictures of the prototype. And in appearance and function, this thing's a rolling iPhone. Jack, this thing has more screens than an Apple store. The steering wheel should just be a joystick.

Another missed opportunity. Great call, man. It looks like the interior of the car was painted and iPad. Ready Gamer One. Actually, instead of doing a single screen like a Tesla, the entire dashboard front of this car from side to side is a screen. Five screens from side mirror to side mirror. It's like an IMAX theater. You get in there, you feel like you're missing the popcorn. That's the only thing. But the back seats not missing the popcorn because each headrest has a huge screen as well.

So get this. The seating in this car, it's basically like a video gamer's gamer seat. Right, because it's an electric car, there's no huge engine. There's more space for comfortable chairs. Which it means Sony could stick in some wide seats like you're in an arcade, playing cruising world and are 17 years old. Sony reimagined the concept of the car with this thing. The way we see it, it's less about driving and it's more about watching.

So, Jack, what's the takeaway for our buddies over at Sony and Honda? The future of the car is your living room. Okay, Yetis, the car's value proposition from the start has always come down to two things, function and comfort. The car has to get you from A to B. That's the function. And it has to get you there with heated seats and six cup holders. And that's the comfort.

But the car industry is now adopting the language of consumer tech products. They're not pitching performance. They're pitching entertainment. Actually, literally. Nick and I have seen a few car unveils. This is the only one that didn't mention horsepower, zero to 60 acceleration, anti-lock brakes, automatic transmission. Honestly, full disclosure, we were disappointed.

They didn't even say the word chassis. Instead, Sony described this car as, and I quote, an entertaining and emotional space. No chassis? A third, Mr. opportunity, Jack. Because when you're self-driving in five years, power steering that chassis is not going to matter. No, besties, you're going to be in that car space for a five-hour drive. And so you're going to want to be looking at something. You're going to want to be entertained.

You're not driving. Uh-uh. So the future of cars, it's not really cars, Jack. What is it? It's your living room. For our second story, Arc, the most exciting fund in the whole stock market is shockingly losing to the most boring fund in the whole stock market, Jack. Do less. Do less. Do less. Do less. Do less. It applies to surfing and investing. Okay. Should we tell a story here, Jack? It feels like it's storytelling time. The most memed investor of the last few years, Yeties, it's Kathy Wood. Let's go back to October 31st, 2014 Halloween. Kathy Wood launches a brand new investment fund called the Arc Innovation Fund. Kathy Wood was a Wall Street veteran sick and tired of boring investment banks and old school blue chip companies.

Exxon and GM. All right. So basically here was her investing thesis. What was it, Jack? Invest only in industries of the future. Yeah, the kind of stuff that freaks out your uncle Greg. The internet of things, cloud computing, 3D printing. Gene editing, blockchain, robotics, block blockchain, block robotic. If it could be a club at a business school, an emerging club, then she invested in that industry. Now, she ended up forming ARC as an exchange traded fund in ETF, and it's packaged just like a stock,

even though it's a fund of stocks. Which means that anyone with a brokerage fund could just type in ARKKK and buy that ETF and join in on her stock picking. And many, many, many did. Now, interesting context here, Kathy Wood grew up in Los Angeles from an Irish immigrant family. She's actually a devout Catholic. So she named her fund ARC after Noah's Art.

Now, Yeti's, let's flash forward a few years. during the pandemic, Kathy Wood's ARCETF became the most popular fund in the whole market. If Kathy's fund bought the stock of a particular company, the masses follow. We're talking about the queen of buying the dip, the old BTFD. Bloomberg named Kathy Wood the best stock picker of 2020. Now, Kathy's favorite child always was and still is Tesla. Every fund picker, yeah, every one they've got a favorite child. From the start, Tesla was the number one most invested company in this fund.

Honestly, Jack, she timed Tesla well. Yeah, Tesla, that investment is up 12X for the ARC investment fund. And she's doubling down because what happened when Tesla stock dropped last week, Jack? Every time Tesla stock dips a little bit. She buys a bunch of million dollars more. We knight you queen of buying the dip. Okay, so Tesla's been fantastic. But the rest of her investment,

Not so much. We've hit a new milestone. Yeah, Kathy's legendary Ark Fund has gotten slaughtered the past couple of years. And now here's what Jack and I find fascinating. Shockingly, this fund, this innovative fund, has fallen by so much, it's now losing to the most boring fund of all. Since Ark launched eight years ago in 2014, it is only up by 69% in those eight years. Which means that the ARC fund is now doing worse than the S&P 500 during that same period of time. The ARC fund is doing worse than the most boring fund ever. The rest of the stock market. So, Jack, what's the takeaway for our buddies over at Kathy Woods' arc fund? Do less.

Do less. It's the most broken law of investing. Besties, do less. Just like Paul Rudd told Jason Siegel and forgetting Sarah Marshall, how could we forget that? Finance textbooks have been saying the same thing for decades. Do less. Jack, when a business school professor says to do less, they mean one thing and what is that one thing? They mean, just put your money into one thing. The S&P 500. The S&P 500, the broad, diversified index of the top 500 biggest stocks in the United States stock market. When we say the stock market,

we're referring to the S&P 500. Well, Kathy's fund did too much. Yeah, it actively managed a portfolio every single day, it was trying to beat the market. And full disclosure, this is Nick and this is Jack, and we did too much too. Guilty. We invested in many of the same stocks as Kathy did. Even though those business school professors told us not to. Yeah, we're getting into F in our post-college careers. And yet studies keep on showing that the S&P 500 keeps beating retail investors and hedge funds and hedge funds and Kathy Wood too. In the past year, only 21% of hedge funds.

Hedge funds, the most sophisticated investors, only 20,000. 1% beat the market last year. Now, Yetis, we're chatting with you here. We're all tempted to try to outperform the stock market. But honestly, few people like ever do. Very few do. So we all, we have to do less. Yeah, it's the most broken rule of investing.

Do less. Now, a word about our sponsor, Robin Hood. You know, honestly, your salad, it says so much about you. Nick, you like to blaze your own trail at the salad bar. Yeah, I'm ordering a salad. I go off menu, man. Like a combo of kale and croutons. that has never been made before.

Me? I'm not reinventing the wheel. I like to go classic. If Sweekerian thinks it's a good combo, Jack's not going to change that. Kind of like investing strategies. Some want to build a custom portfolio of stocks, crypto, and options. Others don't want to reinvent. Just give me the most standard ETF. Whether you're tweaking your one-of-a-kind portfolio every day

or prefer a more hands-off approach, Robin Hood has the tools. If you're not investing on Robin Hood yet, to get started, go to robin hood.com slash T-boy to choose your free stock. That's robinode.com slash TBOI. Limitations apply. Stocks offered by Robin Hood Financial LLC, member SIPC. Crypto offered through Robin Hood, all investments involve risk. By the way, this podcast is not owned or part of Robin Hood, and we are not employees of Robin Hood. For our third and final story to kick off the week in the biggest grocery deal in years,

Kroger is buying Albertsons for $25 billion. But the real story here isn't Kroger or Albertson. it's the largest grocery chain. Okay, yesterday, we all did our weekly grocery run. Everyone has like a go-to store. What's your go-to these days? Where are you going? I'm a co-op guy.

Cooperation, not competition. Comes with a free kombucha. I miss gourmet garage in New York. That was a great institution. What's the one called like Zabirs on the Upper West? It's Zabars and we'll have to work on this pronunciation after the pod jack. Yeties. Isle 6 just got a whole lot bigger.

Kroger and Albertsons just announced that they're merging. M-E-R-G-I-N-G. America's two biggest supermarket chains. Kroger is buying Albertsons for $25 billion. Kroger's stock fell 5%. Because that's a lot of money. But it's not just those two brands, Kroger and Albertson. No.

This comes with an all-star food lineup, including Safeway. Yeah. Vons. Uh-huh. RELF. We're talking California classic grocery stores here. All the regional grocery icons are now sitting under one corporate company. It's like Iron Man Captain American Black Panther fighting to

together to sell you a rotissory chicken. But let's look at the numbers. This isn't just a massive grocery chain. No, it is not, Jack. This is officially qualifying as a grocery continent. It's not a chain. It's a continent. Get this, Yeties. We're talking 5,000 grocery stores, 4,000 pharmacies, 2,000 gas stations included in this grocery deal. It would take Lewis and Clark to Newfoundlands to get through all that continent right there. And this new grocery store, it's going to have a combined $209 billion in annual revenues. That is a ton of revenue, Yetis. That is more revenue than Microsoft, a $2 trillion company.

All right, Jack, can we take this context a step further? It's more revenues per year, this combined company, than Uber, Lyft, Pinterest, DoorDash, Airbnb, and Facebook combined. Combined. Yiddies, yeah, we know what you're thinking. Okay, tech companies, they're way more profitable. than grocery stores. True. Grocery stores only have like a 1% profit margin, but few industries take in more of America's cash than groceries. They devour cash. Your weekly food run on Sunday

evenings, that is a recession-proof habit. But this new Crowbertsons, it's going to be so big. So big. It could monopolize grocery competition in lots of regional markets. And they could pump up the price of your pancakes. So the government very well may block this deal. This deal may not happen for this mega new grocery store. But in the meantime, this deal reveals something completely different. This deal reveals our takeaway. So, Jack, what's the takeaway for our buddies over at Kroger and Albertsons? This wasn't just a merger announcement.

It was a giant free ad for Walmart. Funny thing Jack and I noticed, besties. All the press around this story wasn't just about Kroger and Albertsons. It was about Walmart. We could troll after it. In almost every article, Walmart was mentioned more than both Kroen. Broger and Albertson. So like the combined Crowbertson's grocery chain, it's going to have 18% of the U.S.

grocery market. Like, that's big. That's big. That's a big slice of a big market. It's a big slice. Walmart has way more than both of them. Walmart has 25% of the American grocery store market. 25% of sales go to Walmart.

Every fourth mac and cheese, every fourth pack of frozen peas. Every fourth cookie crisp job is going to Walmart. So this Kroger Alpsie's, Albertson's deal, it basically just reveals to us how insanely huge Walmart is and how big their lead is. It wasn't just a mega food merger. This was a free ad for Walmart. And another opportunity for me to cookie crisp. Jack, can you whip up the takeaways for us to start the week? Sony and Honda are going in 50-50 to build a PlayStation on wheels.

Because the future of your car, it's your living room. For our second story, the ARC ETF has fallen so much, it's now losing to the S&P. Do less. Do less. It's the most broken law in all of investing. Our third and final story is Kroger and Albertsons. They are merch in their shopping carts. Yep, but it was really a free ad for Walmart. And Walmart's insane lead in grocery. Now time for the best fact yet. This one sent in by Allison Richards from lovely Marblehead, Massachusetts, just outside Boston. Nick and I mentioned some bears last week on the pod. Jack, it was technically fat bear week, a great week for bears. But we also mentioned koala bears.

Remember the folded towels? Because you get the first impression at the hotel. As Allison pointed out, apparently koala bears are not quite bears. It's not a bear at all because technically a koala bear is a marsupial. Marsupials like kangaroos and wallabies, they are the animals with the pouches. A kangaroo is not a bear. So we shouldn't call a koala bear a bear bear either. In fact, the sprinkle on some Greek on you, marsupial in Greek literally means pouch.

Yeah. So don't call a koala bear a bear. No, it'll slap you. It's a koala marsupial to you. Or to all our Greek Yetis, a koala pouch. You can call it a koala pouch. Yetis, you look fantastic to kick off the week. And if you haven't yet, remember to follow us at T-Boy Pod on Instagram, TikTok, like everywhere.

Yeah, we've got some shenanigans going on over there. You're going to love it. We'll whip up some shenanigans. It's for your podcast of choice. In the meantime, Nick and I'll see you tomorrow. Tea Boy Spagliato. If you know, you know. You know.

just recorded her own first podcast episode over in New Hampshire. Big shout out to Grady, who's getting married in Jakarta, Indonesia. And Emily Brines just got married to her hallway sweetheart down in Maryland. You know, Nick's hallway sweetheart is now his wife, too. True story. And congratulations to Isaac Valdez, who just got a new job in logistics for the Department of Defense. Is that top secret? And happy birthday to Rob Lewis, turning 53 in North Vancouver.

And Brian Harrison is turning 40 on the big volcano. of the Big Island over in Hawaii. And happy 10th birthday to Rafa Bernaldi in Newport Coast, California. Enrique is turning 25 over in New York City. And happy 25th birthday to Paulina Serna in Oakland. Celebrate with an iced Americana. Light on the ice,

Darlene. And to anyone else who's celebrating something today, make it a T-Boff. Celebrate the wins. This is Jack. Nick and I both own stock of Apple, Airbnb, and Robin Hood. And we should do less. We also own some ETFs with the S&P5. Now, a word about our sponsor, Robin Hood. Okay, so Jack and I both worked in finance for a while.

And we know the six-monitor Bloomberg jockey, with charts, numbers, balances, and more charts. They got coffees in both hands while they're executing some complex trade on a soybean future. Well, we're not trying to impress with our mission control trading center. Just give us an app, please. Robin Hood, with its mobile first and intuitive design, it lets you trade with just a few quick taps on their app. And even if things still don't seem easy, Robin Hood has your back 24-7 with its live. and robust customer support. If you're not investing on Robin Hood yet, to get started, go to Robinhood.com slash T-Boy and choose your free stock. That's Robinhood.com slash T-B-O-I. Limitations

apply. Robin Hood Financial LLC, member SIPC, all investments involved for us. By the way, this podcast is not owned by or part of Robin Hood, and we are not employees of Robin Hood.