The Best One Yet - 🎬 “Quentin Tariff-tino” — Hollywood’s digital trade war. Warren Buffett’s secret investing sauce. Skechers’ $9B retirement.

Starting point is 00:00:00 This is Nick. This is Jack. It is Tuesday, T-Boy, Tuesday, May 6th. And today's pot is the best one yet. This is a T-Boy. The top three pop business news stories you need to know today. And yet is, in case you missed it yesterday, mark your calendars. We announced our next city for the T-boy Live show. What do we got, Jack? On July 23rd, Nick and I are going to record this podcast live. Oh, yeah. From the Vic Theater in Chicago. Oh, boy, 1,000 seats. There you go, Jack. There you go. Tickets drop tomorrow. Follow us at T-Boy Pod on Instagram for the link. If you're not in Chicago, fly into Chicago and pull off some logistics. You're going to love this live show. But Jack, three stories for today's pod. What do we got on the T-boy? For our first story, Hollywood was just terrified. Oh boy. All movies must now be made in America

Starting point is 00:00:49 or else pay a 100% tax. So we are turning our spotlight on the first ever digital tariff, the Tom Hanks tariff. For our second story, Skechers was just a quite. fired for $9 billion. Skechers is the third biggest shoe brand on Earth. And why is that, Jack? There are more retired athletes than there are athletes. What are we going to do with cleats? Honestly, what are we going to do with cleats?

Starting point is 00:01:13 I haven't bought cleats since I was 21 years old. Skechers is the only shoe company that gets that. Third and final story, what do we got, Jack? Over the weekend, Warren Buffett announced that he is retiring from Berkshire Hathaway at the end of the year. So Jack and I found the secret sauce to the world's greatest investor. Get this. It's not calculations. It's culture. But yet,ies, before we hit that wonderful mix of stories. Whoa, what a mix of stories, Jack. Odds are, statistically speaking, there's one app besides the podcast app, open on your phone right now.

Starting point is 00:01:42 And that app is Google Maps. You've arrived at your destination. Cartography is a thousand years old, but Google Maps is the only map to go viral. Get this. Two billion humans use Google Maps every month. to get from point A to point B. And the numbers are so big, it would make Magellan explode. But if you think Google simply built Maps with a team of engineers... Oh, boy, are you wrong? Get this. Google Maps was built by a startup.

Starting point is 00:02:12 Nay, two Danish brothers living on their mom's couch created Google Maps. But then once Google acquired their startup, they used it to make Steve Jobs very, very, very angry. This is the unknown part. Google Maps caused the biggest tech beef in here. history between Google and Apple. This story is so wild, it even involves the CIA. Oh, and Google Street View? The wildest logistical accomplishment since Hands Across America. So besties to hear the true origin story of Google Maps. Turn left. No, no, no, no, don't do that. Don't do that. If you want to hear the true origin story, check out the latest episode of our weekly show, The Best Idea

Starting point is 00:02:52 Yet. Google Maps, it turned a two-dimensional piece of paper into a multi-dimensional economy on everyone's phone. Tap the link in this episode description to listen to our other show The Best Idea Yet on Google Maps. Because this week we tell the true and untold origin story of that wild product. But Jack, we got three fantastic stories for today's T-boy. Should we hit the show? Let's do it. Let's hit him, baby.

Starting point is 00:03:13 Fifteen years before this song, two boys from the Northeast met in the dorm. They had an idea that caused a cultural storm. 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.

Starting point is 00:03:29 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. First, a quick word from our sponsor. For our first story, President Trump announced a 100% tariff on movies and not filmed in the United States of America.

Starting point is 00:04:00 What does that mean? It means the trade war just leaped from physical goods to digital, too. The industry is dumb. Dying a very fast death. That's not a quote from The Fast and the Furious. It's a tweet from President Trump on Sunday night about the Hollywood film industry. Because other countries give tax incentives to Hollywood so they will film abroad. And President Trump says that is a national security threat.

Starting point is 00:04:27 So our first thought, what is it, Jack? We're going to need domestic dupes for all these foreign filming locations. Yeah, like the Avatar sequels, they can't film those in New Zealand now. It's going to be too expensive. What's the New Zealand equivalent of the United States? Oregon? Yeah, let's do an Oregon, Jack. Broad landscapes with the ocean right next door. Or instead of filming in Austria, you could do Vermont.

Starting point is 00:04:49 Instead of Paris, do the French court of New Orleans. Oh, you need a location dup for 18th century England. The back bay of Boston, baby. Just blur out all those Dunkin' Donuts in the background. Yeties, what we are saying is we are about to face the first ever Tom Hanks tariff. Or do you want to go with Tom Cruise tariff, Jack? Tom Huddleston tariff. Or Jack, what are you?

Starting point is 00:05:08 What about Quentin Tarifino? Could we go with that? That's pretty good. Now, yet he's Hollywood is confused about this situation. And economists think this is unprecedented. Because tariffing physical goods is pretty straightforward. It's been done for 100 years. But trying to tariff a movie, how would that even work?

Starting point is 00:05:26 The fear of the industry is that a new tax might have to be added to movie theaters when you go and buy tickets. There's a whole bunch of other questions. What will happen to films that have already been filmed overseas? like the wicked sequel. Or Jack, what about the Minecraft movie that's in theaters right now? That was filmed abroad.

Starting point is 00:05:42 Does that mean prices are going to double at the cinema? And if so, when is that effective? And Jack, this tariff, does it apply to animated films in addition to action films? They're not shot abroad, but they are coded abroad. Oh, and Jack, will TV shows be included if we're talking Hollywood? Trump only mentioned movies.

Starting point is 00:05:57 So Basties, like with previous tariff announcements, this one is raising more questions than it is answers. But here are some of the facts about the industry. In the 1970s, 60 to 70% of all movies and TVs were filmed in Hollywood Studios, right here in Los Angeles, California. But Jack, could you sprinkle on some context to Hollywood today? The percent of movies filmed in Hollywood is down to 18 percent. Much of film production has moved to Atlanta, New York, or the UK due to tax incentives. That's why Ben Affleck recently said California

Starting point is 00:06:25 has taken the film industry for granted. Too much red tape when you're trying to tape film. So a new tax on movie tickets filmed entirely or partially overseas that will make America. and made movie productions more competitive. It'll make Disney more likely to greenlight a project if it doesn't have to be filmed abroad and be subject to all those new taxes. But as economists would point out, it could also, like all tariffs in general,

Starting point is 00:06:50 simply make the entire market smaller. There isn't going to be a Lord of the Rings sequel if filming in New Zealand means a 100% tax. But Besties update as we're recording this episode right here. The White House just said, no final decisions have been made on movie tariffs and they're still, and I quote, exploring all options. Like with the Jurassic World movie coming out this summer, dinosaurs are from another era.

Starting point is 00:07:13 Do we tariff the Tyrannosaurus if it's a Cretaceous period? TBD. TBD. Where am I tariffs? So, Jack, what's the takeaway for our buddies over in Hollywood? The trade war just made a leap from the physical to the digital. Yeties, this announcement by Trump is a declaration of war on digital goods. And digital happens to be what America's economy does best. Remember, 70% of America's GDP is non-physical stuff that we make.

Starting point is 00:07:44 In fact, as Jack and I have told you, our economy's digital power has been our strength during this trade war. Because as countries retaliate against the United States, they were never able to retaliate against the U.S. technology, software, movies, music, or finance that we export abroad. But Trump's Hollywood tariff, it would make all our digital services suddenly fail. game for trade war retaliations. Don't be shocked if countries announce reciprocal tariffs on U.S. filmed movies. And that is why Netflix's stock and Paramount stock, they both dropped on news of the Hollywood tariff. And even if governments don't act, we could get boycotts from citizens abroad, just like Canadians are boycotting made in America whiskey. Because the Hollywood tariff, the Quentin Tariff Tino, it opens up a new front in the trade war. It would be the

Starting point is 00:08:30 world's first digital tariff. For our second story. Skechers, the least athletic shoe brand in history, was just sold for $9 billion to private equity. Skechers became the third biggest shoe company on earth by jumping generations. Now, Yeties, Jack and I are putting ourselves out there. We're doing a little reputational risk right now, but Jack, you want to share with the Yeties our thoughts?

Starting point is 00:08:56 Is Skechers one of the great American fashion startups of all time? I mean, hear us out here. Founded 33 years ago by Robert and Michael Greenberg, a father-son founding duo, baby. I can't think of another father-son company. It's a lovely story. Also, an L.A.-based company. The father is still the CEO.

Starting point is 00:09:13 The son is still the president, and the company is still headquartered right by the beach. The IPOed in 1999, and get this, sales of Skechers have tripled from $3 billion 10 years ago to $9 billion today. In fact, Skechers is still in growth mode. Their stock, I'm sorry,

Starting point is 00:09:30 their sales jumped 13% last quarter. In fact, by sales, In sales, Skechers is the third biggest footwear brand in America behind Nike and Adidas. That's right. Skechers is walking all over Birkenstock. And when Crocs heard this news, they almost choked on their gibbets. Well, here's the news. Skechers is being acquired for $9 billion by the private equity firm, 3G Capital.

Starting point is 00:09:53 That's right. The same PE firm that once acquired Kraft Heinz, Burger King, and Budweiser. The stock jumped 25% on news of the acquisition. In fact, the stock rose so quickly. So fast. Investors pulled a hamstring trying to keep. Kee Chouse. Slow down over there! Here's the surprise when Nick and I jumped in T-Boy style. Yes, Jack. Every sneaker brand is defined by top performance. Just do it. Phil Knight came up with

Starting point is 00:10:16 this idea initially in the 1960s. Yeah, we read his autobiography, and he talks about how aspiration is how you sell sneakers. Kind of like how if a Jeep is good enough for World War II, it's good enough for your Costco run. Well, if a Nike sneaker is good enough for the New York Marathon, it's good enough for your gym visit. And yet, Skechers is the opposite of aspiration. That's right. There is no sneaker more associated with walking, not running, than Skechers. It is literally the only shoe that adds treads to slow you down.

Starting point is 00:10:48 It's the unofficial dad shoe of Stroll and Disney World, too, by the way. And it pairs well with a fanny pack. Oh, it looks fantastic with a fanny pack. And Jack, remember when Skechers did try to do performance shoes? I do. We covered it on our newsletter before we launched this podcast. Skechers shapeups. They were purported to tone your calves, your butt, even your abs, because the way the shoe was shaped, you had to be on your tippy toes the whole time.

Starting point is 00:11:13 But Jack, what happened in 2016 with those Skechers' shape-ups to boof-up your booty? The FTC charged them with deceiving customers, so Skechers paid $40 million in a settlement. But then, Yeties, instead of falling down, Skechers made a pivot. They made a generational jump, actually. Basically, Skechers realized the sneaker industry was just too obsessed with the young, with youthfulness. What about the not young? Every shoe company was ignoring the entire population over 55. So Skechers made an interesting move. Instead of just changing the marketing, they also changed the product. They added foam insoles to make the shoes comfy. They launched slip-on, so you don't have to bend over to put these things on.

Starting point is 00:11:51 It basically said, we're going to make a shoe not for track and field, but for the shuffleboard. Now, Skechers still has basketball shoes and baseball cleats available today. That is a fair point check. But the biggest celebrity athlete endorsement, Skechers has? Yeah. It's your Nana's pickleball team. Yeah, they've switched from kickball to pickleball. From the Dallas Cowboys to Del Boca Vista. No more Justin Bieber. They're all in on Tony Bennett, baby.

Starting point is 00:12:12 So, Jack, what is the takeaway for our buddies over at Skechers? One man's trash is another man's target customer. Yeties, Skechers CFO said that Skechers does the complete opposite of every other shoe brand. Mainly, they found who Nike ignored. Nike is for superstars. Hoka is for elite runners. On is for tech bros, and Adidas is for fashionistas. Even in their marketing, Skechers found value in retirees, the same kind of retirees who they're targeting.

Starting point is 00:12:43 Because look at Martha Stewart, Joe Montana, and Howie Mandel. They're all past their prime. They're all retired, but they're still household names and their Skechers' celebrity endorsers. Yeah, Nike's not sponsoring Wayne Gretzky anymore because he's not on the ice, but Skechers will, and they did. Sketchers strategy was basically to embrace retirees, to fill the hole left by every other shoe brand. Because one man's trash is another man's target customer. Now a quick word from our sponsor. For our third and final story, Warren Buffett is stepping down as CEO of Berkshire Hathaway.

Starting point is 00:13:22 So here is our living eulogy to Warren. Warren Buffett's secret to financial success and a 5 million percent return. True story. It actually has nothing to do with stocks and has everything to do with culture. Now, yeah, he's a funny thing, but over the weekend, we did a video and we dropped it on Instagram. New York City Restaurant Influencer does the Berkshire Hathaway Shareholder Conference. Come with me as we review the hottest news shareholder event in the history of finance. That video caused a minor stir on our socials.

Starting point is 00:13:52 But then something else caused a major stir in the news industry. Warren Buffett's retirement announcement at that shareholder conference was a huge, deal. That's right. After 60 years, Warren Buffett will retire to become chairman of his investment firm on January 1st, 2026. A man named Greg Abel will take over as CEO. We actually did an episode on him one year ago. We did. So there's a link in the show notes if you want to hear that episode and hear our profile of Greg Abel. But yet is Berkshire stock? It fell 4% because shareholders are sad that the legendary Warren is leaving. But Nick, imagine if Warren Buffett, who's 94 years old, had died while still being the CEO.

Starting point is 00:14:31 I don't even want to picture that, Jack. So this announcement ensures a smooth succession from this wise old man to someone younger. In fact, he got a standing ovation, and honestly, Warren's response tells you what kind of a guy he is. Here's how he responded to the standing ovation he got after announcing his retirement. The enthusiasm shown by that response could be interpreted in two ways, but I'll take it surprise. In fact, he had these people in his hometown of Omaha, Nebraska love Warren so much, they don't list their homes in U.S. dollars. They list them in the number of Berkshire Hathaway shares. I don't know.

Starting point is 00:15:04 Now, here's a reminder about what Berkshire Hathaway does. First, they buy entire companies outright, like they've bought Guycoe and Dairy Queen in the past. Or they buy stock of companies who they can't buy outright, like shares of Amex, Apple, or Coca-Cola. And under Warren Buffett's leadership, Berkshire has picked the right companies. They've picked the right stocks,

Starting point is 00:15:26 and they've done it for 60 years. Get this, Warren Buffett has only lost. money in 11 of those 60 years. This year, the stock market overall is down, but stock in Berkshire Hathaway is up by 20%. This might be his best year yet. In fact, Berkshire Hathaway stock has risen 5.5 million percent from 1964 to 2024. Mathematically, I don't even know what that means. Mathematically, we've never even said the number 5.5 million percent before, Jack. Here's how we got there. The average annual gain of Berkshire Hathaway. stock is 19.9% for 60 years, which happens to be twice the rate of the S&P 500 over that same period.

Starting point is 00:16:09 And if you're wondering when to sell the stock that you recently got a nice gain on? Well, Warren Buffett and Berkshire Hathaway would tell you to hold it forever. That's right. Their quote is, our favorite holding period is forever. And what's the reason for that check? They describe long-term compounding of gains as like a snowball rolling down a hill. It gets bigger and bigger. What that means is, as a stock gives off dividends, you could just take that cash and spend it, or you could reinvest it in that same dividend driving stock. Berkshire reinvests. Now Yeti's finance professors, they always say, hey, you can't beat the market, you shouldn't even try. And yet, Warren Buffett has beat the

Starting point is 00:16:46 market consistently for 60 years. Five and a half million percent of return, we've never seen anything like it. The result, Berkshire is now worth a trillion dollars. The only non-tech company ever to hit that high besides Saudi Arabia state-owned oil company. So we know what you're thinking besties? How the heck did Warren Buffett pull it off? And the answer is our takeaway. So Jack, what's the takeaway for our Omaha buddy over at Berkshire Hathaway

Starting point is 00:17:11 and everyone investing right now? Where culture leads, money follows. Yides, when Jack and I started working at Robin Hood after we sold our first startup to Robin Hood, the compliance officer named LaSallevon showed us this cool video. It's Warren Buffett testifying to Congress in 19, He was saying how he would clean up Solomon Brothers, the Wall Street firm that had recently been in a scandal.

Starting point is 00:17:34 But I also have asked every Solomon employee to be his or her own compliance officer. After they first obey all rules, I then want employees to ask themselves whether they are willing to have any contemplated act appear the next day on the front page of their local paper to be read by their spouses, children, and friends with the reporting done by an informed and critical reporter. If they follow this test, they need not fear my other message to them. Lose money for the firm,

Starting point is 00:18:05 and I will be understanding. Lose a shred of reputation for the firm, and I will be ruthless. Yet these thousands of men and women in finance try to pick stocks just like Warren Buffett, but nobody ever has. That clip shows why. It shows his commitment to a culture of integrity,

Starting point is 00:18:21 and it was unmatched. So Bessie is the secret sauce to Warren Buffett's success. It's not stock picking prowess. It's cultural prowess. Jack, could you whip up the takeaways for us for T-Boy Tuesday? President Trump asked his Commerce Secretary to create a 100% tariff on all movies filmed abroad. It's Quentin Tariff, Tino, baby.

Starting point is 00:18:44 The trade war just leaped from the physical to the digital. For our second story, Skechers just sold for $9 billion, and the stock will get delisted as this private company takes over. They did it by jumping generations. One man's trash is another man's target customer. And finally, Warren Buffett is retiring as the CEO of Berkshire at the end of the year. His genius wasn't in calculating stocks. It was in creating a culture. But Yeties, this pod's not over yet. Here's what else you need to know today.

Starting point is 00:19:13 First, OpenAI is abandoning their conversion to become a for-profit company. Awkward. It will instead transform its for-profit subsidiary that owns ChatchapT into a public benefit corporation that is controlled by the non-profit parents. Don't worry, Basties. Even the lawyers don't know what that means. Chat TVD is basically like that kid who works for Teach for America, even though their parents are in Peace Corps. Definitely no profits.

Starting point is 00:19:42 No. And second, Lady Gaga had a free concert over the weekend in Brazil. That was the biggest concert in history for a female artist. Two and a half million people attended. It was on Copacabana Beach in Rio. Madonna drew 1.3. 6 million people at the same venue last year, by the way. But the biggest concert of all time, it was 1994, it was Rod Stewart, and it was at the same venue.

Starting point is 00:20:04 And by the way, this summer is expected to be the biggest concert summer ever. And finally, brawny just launched the largest innovation we've ever seen in the paper industry. An unprecedented three-ply paper towel. Which makes it 50% stronger than bounties two-ply toilet paper. Sorry, not toilet paper, paper towel, big distinction. That's the math. But we should bring up, this could bring up an escalation, a slippery slope in the paper towel industry we haven't seen since the nuclear crisis of the 1960s. You don't think bounty's going to launch a four-ply paper towel, do you? Jack, it could end up like Gillette and the Razors. Remember the Mach 18?

Starting point is 00:20:40 We need a mutual de-escalation right now. Before things get out of hand. Now, time for the best fact yet. This one sent in by the lovely Molly Martel in San Francisco by way of Allen Hall at Middlebury. college, and yes, we said lovely because she's my wife. Now, many people think of May 6th as simply the day after Cinco de Maile. Molly thinks of it as her birthday, but she also pointed this out, Jack. Not only is it Seis de Mayo, Molly's birthday, it's also the birthday of one of the greatest structures in the history of architecture. On May 6, 1889, the Eiffel Tower officially opened to the public during the Paris World's Fair.

Starting point is 00:21:20 It was supposed to be temporary, but the city of Paris, and they decided let's keep this thing. They said, you know what? It's possible. It is possible. Happy birthday, Molly, you look fantastic. Great girl. Great girl. Yiddies, you also happen to look fantastic today.

Starting point is 00:21:37 And right after the show, we know exactly what you should check out. Make a right, make a left, and then go straight to your destination. Our TBIY episode of Google Maps. If you're listening to our Frapachino episode, you've gone too far. You need to do a U-turn and listen to our Google Maps episode. The best idea yet. And Nick and I will be right back here tomorrow for another T-Buy. If you know, you know.

Starting point is 00:21:58 And before we go, it's a birthday week in the Brink family. Brookie Brink and Skyman Brink are celebrating birthdays just outside Boston in Angham, Massachusetts. Brookie and Sky, can't wait to see you next winter at Sugarbush. And down south in Montclair, New Jersey, it is Sophie Panzer's best birthday yet. Happy birthday to Will Power in Chicago, who's killing it at work and is a great partner and a fantastic father. And Lindsay Pulitzer in Chicago as well is celebrating with the best eighth graders for the fantastic birthday of Lindsay. And finally, tickets to our live show in Shytown come out tomorrow. We'll see you there.

Starting point is 00:22:39 Check it out. This is Jack. Islandstock of Berkshire Hathaway, Netflix, Disney, and Crocs, and Nick and I both on stock of Apple and Robin Hood, as well as some ETFs of the S&P 500.

The Best One Yet - 🎬 “Quentin Tariff-tino” — Hollywood’s digital trade war. Warren Buffett’s secret investing sauce. Skechers’ $9B retirement.

There aren't comments yet for this episode. Click on any sentence in the transcript to leave a comment.