The Compound and Friends - Betting on OpenAI, SpaceX Dust Settles, Josh’s New Trade

Episode Date: June 16, 2026

On this episode of What Are Your Thoughts, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Downtown Josh Brown⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Michael Batnick⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ are back to break down one of the biggest investing stories of the year: SpaceX joining the ranks of the world's most valuable companies. What does its rise say about American capitalism, private markets, and the role investors play in funding innovation? They also dive into the best ways to invest in the AI boom, including the growing debate over OpenAI exposure and where the biggest opportunities may still lie. Plus, can AI-powered productivity gains coexist with rising layoffs and what does that mean for the economy? Josh and Michael discuss whether traditional software is facing an existential threat, Nvidia’s massive bond sale, the escalating AI infrastructure spending race, and why Josh thinks Robinhood deserves a closer look. This episode is sponsored by Public and ClearBridge Investments. To learn more about Public, visit ⁠https://public.com/WAYT⁠ Rising geopolitical tensions, continued market uncertainty, stocks backed by can offer more predictable cash flows as volatility increases. Visit ⁠https://www.clearbridge.com/ ⁠to learn more. Sign up for ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠The Compound Newsletter⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and never miss out! Instagram: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://instagram.com/thecompoundnews⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Twitter: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://twitter.com/thecompoundnews⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ LinkedIn: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.linkedin.com/company/the-compound-media/⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ TikTok: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://www.tiktok.com/@thecompoundnews⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Josh Brown are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. The Compound Media, Incorporated, an affiliate of ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Ritholtz Wealth Management⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. For additional advertisement disclaimers see here ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://ritholtzwealth.com/advertising-disclaimers⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠. Investments in securities involve the risk of loss. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. The information provided on this website (including any information that may be accessed through this website) is not directed at any investor or category of investors and is provided solely as general information. Obviously nothing on this channel should be considered as personalized financial advice or a solicitation to buy or sell any securities. See our disclosures here: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://ritholtzwealth.com/podcast-youtube-disclosures/⁠⁠⁠⁠ Public Disclosure: Paid for by Public Investing. Brokerage services by Open to the Public Investing Inc, member FINRA & SIPC. Advisory services by Public Advisors LLC, SEC-registered adviser. Complete disclosures available at ⁠https://public.com/disclosures⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

Nixon 5 Did you know those were the words To the song all along? Oh, make it louder What song we... Listen, this song. Yeah, ready? Ready?

Nixon 5. See? I told the McWhirster Nixon 6. I was wrong. Yeah. We did it. I know the chat's super excited for us, like 1% of the chat.

Yeah, everybody's super happy for us. We are the champions. If you guys have been, if you guys have been with us since day one, you understand how meaningful this is to us and how long we have been waiting for this moment. Michael's going to the parade. So that's pretty exciting. I'm not. When you get to my age, you run from parades. I don't know if you know this. I'm going to be 50 years old. Do you have any idea how many books about World War II I'm about to buy? Can you even, can you even

comprehend what's about to be happening? Anyway, we finally got it. So, uh, Congratulations, Nick, Nick fans. Welcome to what are your thoughts? This may or may not be, depending on whether you've seen the show or not, this may or may not be your very favorite show about investing. We do this every week at 2 p.m. Eastern and almost all the time we do this live. For those of you tuning in for the first time, my name is downtown Josh Brown. I'm here with my co-host. His name is Michael Batnik.

Michael, say hi. Hello, hello. All right. And a few long timers. We love that you come back for the live. Thank you so much. Denver Scribe says, Almost missed the live.

Wasabi, everyone. Wasabi. Heather says, Hey, Pounders. Good to see you, Heather. Who else is in the chat tonight? KPS Fred, happy for the Knicks in New York. Somebody said, holy hair.

I know. I had a PRP treatment this morning. actually. My my my my scalp is on fire, but the results are are coming through. It's so good that your face is growing here. I know I'm like the Jalen Brunson of hair regrowth at this point. I'm going for a championship. All right, we have a sponsor tonight. That sponsor is our friends at public the public trading app and public.com. It feels like there are two types of investing platforms right now. Legacy brokerages that look like they were disqualification that look like they were designed in 1997, and then the new wave that looked at investing and thought, you know what,

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and manage your cash and execute your trades. Just enter a prompt, approve the workflow, and put your agent to work. Go to public.com slash wayy to get started. That's public.com slash wayt, paid for it by public investing, full disclosure in podcast description. Go to the thing, guys.

Click the thing. This episode is sponsored by Clearbridge Investments. Amid rising geopolitical tensions and continued market uncertainty, investors are looking for stability. Even before recent developments in the Middle East, stocks backed by real assets were gaining momentum and can offer more predictable cash flows

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I think you're going to, are you starting with doing SpaceX? You know, we're sort of sharing the doc. We're going to start with SpaceX. There's two mega themes that we're going to get to in the show this week. One of them, or tonight, one of them is for the last, as long as we've been working together, which is since 2012, hard as it is to believe, one of the themes over the past 15 years, 16, 14 years, has been, there's not enough stock.

There's too much demand from the relentless bid, and there's just not enough supply because all of these companies are buying back a lot of stock. We're doing it, and there's just not enough equity issuance. That is over. All right. So that era, over in the rear of your mirror. The other mega trend that is over is to the extent that these companies are doing R&D, and I shouldn't have a caveat of that.

They are doing a lot of R&D. It's all been funded with cash flow. In 2020 and 2021, these companies turned the hell out. They gorged on debt because interest rates were basically free for them, too. And they didn't need to issue any more debt. They've been good, better than good. Well, now they're issuing debt. Nvidia $20 billion.

So we're to get to that two themes. But it's kind of amazing. Like, those are mega themes. So we have the SpaceX IPO. Do you think, so both of those things are really important? Do you think the average market participant, even professionals, have come to terms with this really big and important change to the investment landscape? No.

Barron's is going to write about it. it's going to start to become a thing. But no, because it's just happening. It's only just begun. But this is the end of an error. Not saying it's bad, but. That's a great intro to tonight show because we have a lot to say on the topic. All right.

So SpaceX, as we've discussed, the IPO was a little bit interesting, a little bit unusual, very unusual. Only 3% of the flow was unlocked. Or they issued 3% of the company in new shares. So they raised, what are they raised, $75 billion? And so it was a very successful IPO. I think it's most people suspected. Most people did not think this is going to faceplant, given all that we were hearing

about the oversubscription and all that sort of stuff. And it did a face plant. In fact, it did the opposite of faceplant. It is now the market cap of the company is now $2.64 trillion. And I don't know, it's probably going to pass Amazon tomorrow. It is about knocking on twice as big as meta. It's bigger than Taiwan semi. What are your thoughts, Josh?

Well, hang on. It went up 20% the day of the deal, which everyone said, perfect. That's like Goldilocks for an IPO. That means the company did not value itself too low. They didn't leave money on the table. And there was room for the people who bought the IPO to see a profit right out of the gates. So that was Shangri-La. The next day, the stock ran another 15%.

And then today plus six was the last night soon? Plus 4.8. So well off the highs. It got as high as 225, closed at 203. Okay. So if you are an IPO fan and you were watching this from the sideline or you got a piece of it or whatever, there's nothing negative that you could say about the way that this was received, the risk appetite in the market, the pricing. They literally nail, what is the phrase? What is the phrase?

Stuck the landing. That's right. They did. Okay. They manufactured the landing. They did. These are like the smartest people. Like, respectfully, you don't have to like Elon.

I'm not an Elon stand. But these are the smartest people in the world at the big investment banks working for one of the smartest people alive. And there was, I could not imagine a universe where they brought this thing public at a price where it was going to dump on day one. I know a lot of people thought that I know people. did think that there was a chance of that. Of course, there's a chance of it. I did not think that there was a chance, but neither did you. Okay.

So throw that chart back on. I think a lot of people are scratching their head, make it make sense. SpaceX is revenue. I can't remember what it was. I think it's less than $15 billion. Amazon is, I don't know, what's Amazon's revenue? $250, whatever it is. Yeah, hundreds of billions.

All right. So you're like, make it make sense. It doesn't make sense. It can't make sense. And I think that, talk to me in a year, when all of the shares, ex-elons are publicly traded, and there is not $75 billion out there, or I guess it's now up to $110 billion, whatever it is, when there's a trillion worth of stock out there and it's

still $2.6 trillion, I'll say, all right, this makes no sense. But right now, it's sort of, it's not real. It's not really $2.6 trillion. I mean, I know based on like the traditional technically it is, but it's really not. Well, it's not because of the scarcity of shares available, but that's going to change within a couple of weeks. Really fast is going to change. And then that'll be a good test. How many versions of the chart? What does the typical IPO do a year after it comes public? How many versions of that did you see going around last week? Yeah, there's a lot. What is that sour grapes, people that like they feel bad that they couldn't get in on it. And so they're like professionals, like telling their clients like, yeah, but dude, here's what's going to happen.

No, listen. I think I, I, it's 50%. Yeah. I like, I like, IPO. is 50% lower a year later? Okay, so I think people need to know that. So I don't think anybody's valuing this on the discounted cash flow or looking out 10 years. People looking out 10 days, tops, 10 hours. People are flipping this. So again, talk to me in a year. Like, we'll see where it is in a year.

I would expect it to be lower. I'd be really surprised. Put it this way. If the market holds basics at $2.6 trillion or even $2 trillion or even $1.5 trillion a year from now, then the bull market is still, is still, is still roaring. The sell side started coming out with $3 trillion revenue projections. Obviously, not for 2026, but like he started hearing some of that. And then, oh, what was the other thing I wanted to ask you about? It escapes me. I think the big takeaway is there just wasn't enough stock

relative to the amount of demand. And it's not even like the demand shocked anyone. Everyone knew there would be a lot of demand, but there was just, there was more. And that's why you get a follow through into day three. It's pretty, it's pretty remarkable. The 2X, the 2X leverage versions of SpaceX, the ETFs, came out the next day. That's brave new world shit. I remember when it was like six months or three months or so. Now it's just like automatic, our product is ready to go.

And they did a billion. They did a billion dollars worth of volume. Do you think that influenced this follow-through that we're seeing in the price? I would guess. I don't know enough about the mechanics of how these things impact the underlying. I would guess. Josh Shaver tweeted SpaceX just had the second largest one-day market cap increase on record. That was yesterday.

$433 billion. Again, yes, technically true. Phantom market cap. That's exactly right. So to me, this is not a valuation story. Anybody who's looking at this, and I understand why they're saying that, anybody who's looking at this and saying this is such a sign of the times, How do we have a two points?

It's not 2.6 trillion. It's not. On paper. On paper. It's a giant asterisk. On paper, the company, based on the 3% of its shares that trade freely or that were sold last week, on paper, it's worth that. I mean, there's nothing you could do about it.

That's just what it is. But even the indices that are going to add it, they're not adding it as though it's 2.6 trillion, they have to adjust that by how small the float is, and they will. So we're going to get used to it. The dust is still settling. They basically confirmed the cursor deal today was the news. So they announced in April that they were going to acquire this company cursor, which at one time, maybe in 2025, was the leading AI coding company. So they would help software developers with AI tools. And then, of course, as we know, a lot of, a lot more tools came along, most notably,

Anthropics coding, coding tool. And what's interesting about cursor, it's a $60 billion acquisition. It's being paid for in SpaceX stock. Do you know what the breakup fee is? What is it? $10 billion. dollars. If SpaceX fails to complete this acquisition, they would owe Cursor, the company, $10 billion. Think about this world that we live in right now. Like, breakup fees,

I remember like $5 million breakup fees being like customary. So this is just complete insanity. Where, what is cursor? It's interesting. They kind of, of piggybacked on Anthropic and built their own tool utilizing Anthropics models, but then they pivoted and starting doing a lot more with XAI, which is the SpaceX, sort of the thing that owns Twitter, but also it's like SpaceX's LLM business. And they went from being a custom, primarily a customer of Anthropic to now being a competitor to Claude Code that's going to be full. folded within the Elon Empire. And we know there's no love lost between Anthropic and X-A-I or Elon and the people backing

Anthropics. So it's sort of like, it's sort of like, what's the thing that happens in wrestling where 20 guys are in the cage together? The Royal Wumble. It's like a Royal Wumble at this point. And it's hard to disentangle who's invested in what and who's backing who. This is the part of the story that pisses people. pull off, and I understand the sentiment. I'm not exactly thrilled about it either. There are,

I don't have the schedule in front of me, but there are provisions in the waterfall, the lockup, that if there are targets met, if the stock is up 20%, the stock is up 30%, more shares are able to become unlocked early. And when, or if that happens, then I do suspect that this thing will trade way down, way fast, upon index inclusion. Now, thank God the index providers or the index manufacturers are saying, we're not taking all of this. We're not doing it. We're going to put a cap.

We're going to put a maximum of three times the float, whatever the rules are. So it's not going to absolutely nuke the index. It's not going into a $2.6 trillion valuation, thank God. But nevertheless, it does kind of suck that they probably will be using retail or index funds as exit liquidity. Again, it might be 30 basis points, But whatever it is, it still doesn't sit right with a lot of people. Right.

In their minds, they're like doing retail of favor. Like exit liquidity. They're begging us for the stop. Right. That's the attitude. This tweet is wild. What's going on here? Here's another thing that people don't particularly care for.

There's just no rules anymore. Julian Climochco tweeted. So Elon tweeted, I think SpaceX might be able to reach approximately $1 trillion in revenue in 2030. And I would be surprised of revenue is not greater than one. trillion dollars in 2033. Are you allowed to do that? Traditionally, I mean, traditionally, this is this sort of thing is, I think, frowned upon. So Julian said this is the most ambitious management guidance in market history and there's been no AK filed. By the way, somebody said this would be a 90% K-Gar between now and then maybe they could do it. I don't know.

And if they, I hope they do do it. It'll be wonderful. It'll be wonderful. But put that, put that back up. This tweet would be handcuffs. Handcuffs, not a fine, handcuffs in another era. You could not do a public offering and then two days later come out and put your 20-30 revenue guide on Twitter. No. In the midst of the hottest offering of the year without some sort of a filing. But Elon Musk told the SEC literally to SSD on Twitter six years ago.

I don't think anything happened with that. Like, I'm sure a lot of lawyers got paid, but there were no consequences to him whatsoever. Remember funding secured when he was going to take Tesla private? Right. And frankly, from the White House's agenda and, you know, the SEC sits beneath the, you know, the president wants more of this. The President of the States sees this as America winning. And it is. So I really, I think he could basically say whatever he wants and I don't think any rules apply to him at all.

It's the world's richest man. Who's going to do anything about it? So a good segue into something that you wrote over the weekend about what makes our country special. You said, I went into the weekend thinking about how... Can you read this without shedding a tear? It's so beautiful, whatever. I cried the first time. I went into the weekend thinking about how incredible our capital markets are.

Only in America can a company start itself up in a garage and within a few decades because one of the most valuable businesses on earth. It takes intrepid entrepreneurship, sure. But what's also required is you, the American investor. The Germans and the Japanese and the British and the Brazilians have their founders and their risk takers. But what those markets are missing is the tens of millions of ordinary people who are willing to back these dreams and gambles with their own investment capital. Nobody does us like we do. We are the descendants of dreamers and gamblers, many of whom left behind everything.

Many of whom left everything behind that took the ultimate gamble with their very lives on the line in order to get here. This started in the 1600s, and it continues until this day. without the American investor, there is no SpaceX, without the city of New York, there's no transference of these risks from venture capital to the public stock markets. It's so true. Yeah. So look, there are unbelievable entrepreneurs around the world. Like, look at the guy from Spotify, Daniel Eck, what a genius. But that thing trades in New York. Like, let's not, you know what I mean? Like, let's not forget. And, you know, it's, it's not, it's not, It's not anything specific about the NASDAQ and the New York Stock Exchange, although those are the two greatest exchanges in the world.

Those exchanges could exist elsewhere if the investors were there. But the investors are here. They're in America. The type of psychopaths like us who are willing to put money into things where maybe the rocket won't explode the 10th time after it just exploded nine times in a row. That doesn't exist. No one's doing that. Look at what people are doing with their money in these other places. They're holding gold jewelry under the bed.

They're holding bonds at negative interest rates for 10 years in a row. We are, we, all of us, and I'm saying this on the 250th anniversary of the United States, and on the heels of a championship in the city of New York, we are a rare breed on this planet. And it's not that there aren't risk takers elsewhere. there aren't a hundred million risk takers elsewhere. We are the only game in town for something like a SpaceX to be able to come along. So I appreciate that that struck you. And I think it's super important for people to understand.

We are built different. So getting to the conversation that we opened the show with about there was everything up until 2026. And now there's what happens on a go forward basis. So Bloomberg wrote about this. They said for the better part of two decades, a defining feature of the U.S. stock market has been scarcity. Year after year, it shares disappeared from public hands with buybacks by S&P companies alone erased nearly $12 trillion dollars worth. 12 trillion in corporate buybacks.

And now investors are about to discover what happens when the supply suddenly comes rushing back. So check this chart out. I mean, it's, it's, I'm sorry. Is that, wait, wait, wait, wait, is that what are the numbers here? Is that $1.2 trillion in equity issuance? Yeah. But is Is that inclusive of SpaceX? These are estimates. Holy shit. Like the estimated free float changes. Yeah.

So this is what they expect to actually come to market. And Josh, you've been talking about us for a long time, like, it's all about when investors are satiated and when we're overserved. And this is it. I mean, I'm not, you know,

this is like the thing. And if we can get through this, then I don't know what the bears have left. But we're not through it yet. And I'm definitely not ready to spike the folks. because there's there's a lot in front of us still to come open a i and anthropic which we're going to get into in a second and they're all i mean there's a lot more yeah well that that's probably a 27 vintage we don't know the extent to which we'll see more of what we saw from oracle and alphabet we don't

we i mean what if what if apple decides yeah we've spent 15 years buying back stock we made the decision we actually want to sell a big chunk. What like meta, very likely, you know, it's a lot of companies are reversing the flow. They were sucking up every share of stock out there that they could. And now it's a different world. And I agree with what you said. I don't think this has dawned on everyone yet. No.

So probably not going to be bullish for multiples for long. This is, this would not be bullish. forget about Apple, they're not going to do it. But it's happening. Like Oracle is doing 20 and 20. Yeah. It's happening. Google.

What is this rainbow, Joe? Oh, all right. So I want to just, I would just want to, before we get to the next topic, by the way, today, we don't really have much about the actual stock market in the show tonight. Did you see the candle in Micron? Micron opened at a new all-time high and closed down 6%. Barish and golfing. Barish and golfing? All the way.

Engulfing. All the way. Engulfed. Oh, we'll do it on compounded friends. So, all right. I just wanted to make the point that we're talking a lot about it's AI and everything else. And there's few stocks working. Not really true.

In fact, not true. Not true at all. Mike Scorardi tweeted this chart. Throw those up, please. Look at the green line. We've got 64% of the S&P 500. above their 200 moving average. That is the highest since,

uh, was that March of last year? So long as those companies are either involved in AI or luxury travel will be okay. I don't think this really, I don't really think there's much else. It's not just seven stocks, not even close. All right.

Um, so Josh, how do you play Open AI? Well, so this, this is, uh, this is where we're going now.

So if you watch this SpaceX thing with your jaw, a gabe going into day three of gains. Probably goes up every day for the rest of our lives. I have no idea. And you're wondering what's going to be the next one. It's probably going to be open AI. They seem to be very aggressively elbowing to the front of the queue. It seems like there is a concerted effort to get news out there, get filings out there,

and get out ahead of Anthropic. I think they don't want to be the third one of the three public. and I think maybe there's even some cachet getting to get out ahead. And so we are hearing increasing rumblings that this thing is going to come soon. Originally, they were saying September. But they could shock everyone.

Nobody knows at this point. It just feels like everything's in flux. My friend Andres Shepard at Canter Fitzgerald put out a note citing the OpenAI IPO filing. They filed the confidential S-1 last week as a material catalyst for SoftBank, which is a huge shareholder. And so I wanted to share this idea with our audience.

If you don't think you're getting allocated OpenAI and you miss SpaceX, this might be a stock, a ticker that you want to have on your screen. And you definitely don't have it already because it has five letters in its ticker. It is an ADR. SFTBY, if you want to punch it up, is SoftBank. And SoftBank is run by Masayoshi. son, who is a riverboat gambler, has taken some of the biggest swings of all time that anyone has ever seen in the stock market.

Sometimes they've worked out like Nvidia. And sometimes they haven't like we work. But this is what he does. He takes huge concentrated positions, borrows a lot of money to do it. And when he believes in something, he goes all in. And he has gone all in on AI, specifically open AI. Here's Andres. Open AI recently announced that it has filed an S1 ahead of a public listing.

While the company did not provide exact timing, it stated it may now potentially accelerate its timing. We view this as the most material catalyst for SoftBank and hour coverage. Open AI comprises 25% of SoftBanks equity value. Since Open AI and Arm, which is also now in AI play, comprises 25, hold on, arm comprises 65% combined with OpenAI of SoftBank's equity value as of March 31st. Open AI closed its latest funding round

with $122 billion in committed capital and an $852 billion post-money valuation. This latest round includes a previously announced $30 billion commitment from SoftBank to be deployed in three $10 billion tranches. SoftBank is committed. 65 billion so far to open AI. We continue to believe soft bank benefits from direct access to rapid AI trend via its open AI stake plus market leadership position in semiconductor IP

via the stake in ARM. They own 90% of arm holdings and all those royalties flow through to SoftBank for all of the way that ARM is involved in data center build out. So Um, he's bullish on soft bank. And I wanted to show you guys the chart. Put this up. So, insanely volatile. Oh my God.

As you can, I said riverboat gambler. And this is, I'm just showing you the last three years. You look at a 10 year history of this. It is a leverage bet now on AI, not quite at the high, but close. And looking like it really wants to party when this open AI, uh, IPO comes along. So, um, The bulk case here is very simple. It is a net asset value of 40 trillion yen or 260 billion U.S. dollars of gains for the company's valuation over the last quarter, most of which is because of Arm and Open AIs market valuation, or in the case of Open A private market.

The thing that's interesting here is that this stock used to trade at a discount. Think of like a closed end fund. Investors would not actually pay what the net asset value of the holdings were because it was so volatile and people didn't fully believe in the bet that he was making. But that discount is closing. And you might think, oh, that's not bullish. Now I have to buy a smaller discount. Actually, that is when you want to buy.

when the re-rate is in full effect. So over the last five years, the discount of soft bank stock to the NAV if its holdings has been 50, 5% percent. In early 2025, it got down to 60% discount. But as Morgan Stanley talks about this, as the AI assets have matured, the discount has fallen from 50 to 35,

and now it's about 17%. This could go to a premium. The stock could trade at a premium to its holdings if people are willing to make a big enough bet on the opening pop for OpenAI. So that's, to me, that's a really interesting story that not a lot of people are aware of. And it's an absolute gamble. People have said, oh, it's like the Berkshire Hathaway of tech. No, it's not.

It's a ton of debt. It's not a ton of cash. And his chips are all in the middle. But if you felt like you missed out on the last big IPO and you want exposure to the next one, this is a pretty obvious. And it trades. It trades millions of dollars. Like it's not a problem to allocate to it in the U.S. So I'm not saying go out and buy it.

I'm saying put this thing on your screen. Start watching it. This is your proxy for what they're going to do with the Open AI IPO. What are your thoughts? Yeah. Yeah, that's interesting. I agree with most of what you said. I think this is going to trade on.

I think this is going to piggyback on what SpaceX does. Because I would guess that OpenAI, as much as Sam Altman and Elon, do not like each other, if this works, and we're three days in, it's early, but it looks like so far so good. If it holds. Then they are likely to follow a similar playbook because the bankers, they're all motivated to do the same thing. Keep the price of the stock up. What does the price of SoftBank do when we hear that the IPO for OpenAI is not going to be a trillion? It's going to be $1.5 trillion. This thing is going to fucking launch.

There's probably a lot of leverage in there. So yeah, no, I agree. I think to the extent that you do want to gamble on the OpenAI IPO, this is probably a smart way to gamble. Gamble. Yeah. I'm crazy enough to maybe do this trade. I'm not sure yet. Maybe I would wait for some negative news flow on AI and try to catch this thing, not at the low, but lower, because it's just had a pretty substantial move from the low teens into the low 20s. But certainly, certainly worth keeping an eye on. We can move on. What did you think about our conversation with Ivesant yesterday? Yeah, guys, we spoke to the chief investment officer at PIMCO, which is one of the largest asset men. in the world yesterday uh we put that out yesterday yesterday it's it all blends together anyway um dan

iverson at pimco and i wanted to bring this back because he said something that we didn't spend any time on i i listened to the show again and i and i said huh that's interesting so here he basically i don't have the exact words he said um the disruption is here which you remember Like the time is now, it's happening now. But then he said, we're going to have a good economy, but with a lot of credit losses and a lot of issues with private equity investments into disruptive companies. And at the same time that we're having these losses, that's actually going to be boosting economic growth. Because those losses represent increased efficiencies and opportunities for profitability for a company. So he's talking about like, it's economic expansion, but with credit losses and with people

underwater and a lot of private equity investment and probably a lot of job loss. And he said it's going to be a very weird economic situation, which I think was his exact words. People can go back and watch that episode. It's up now. But what do you think about that concept? Because we kind of just like it glossed over that. But I don't think we've really spent any time on it.

I think that's, I think that is a likely outcome, unfortunately. You think he's been right about that. I think, yeah. We've never seen anything like it, though. Yeah, so I think the case that he was making that we would agree with is that if you are zooming out and you're purely looking at this, the economic lens and forget about actual human beings for a second. If you are purely a robot and you're looking at the economic, through the economic lens, this is going to be a good thing. The economic pie will increase. There will be productivity gains.

there will be, the pie will grow. Okay, but when you zoom into how the pie is going to be redistributed and where gains are going to be felt and losses are going to be felt, it's going to be really fucked up. And I hope it's just like not as bad as I think a lot of people think it's going to be. And I changed my mind every day on how bad I think it's going to be. But there's going to be obviously political ramifications.

No, no, no, no. But wait a minute, but this is the kernel of that that I want to get to. Which piece? Real quick. Let me just answer it in the chat. New York Dom. why not buy Microsoft on OpenAI IPO as they are the largest single investor at 27%. I have that later in the show.

Okay. Microsoft and Open AI are undergoing a slow motion divorce. And that relationship seems to not be great. Microsoft now is branching out and working with a lot of other companies in AI. Stop. I have Microsoft later in the show. What do we talk? Get back to the day and obvious thing.

So all right. So the kernel that I, the kernel that I want. to do with this is like, we're going to have to throw a lot of things out that we used to think we're meaningful to understanding the economy. Oh, yes, yes, yes. So like, in other words, let's say, so who are we talking to last week, Brian Levitt? I asked him, like, what are the things you actually do care about? Because he's like, I don't care about that. I don't care. Okay, what do you care about? One of his things was about credit and lost, like, I forget some of credit spreads, let's say. you might have to you could see you could see defaults tick up without spreads taking up which would be

super weird but that's what i'm saying because what those defaults ticking up represent is success for ai and all the companies employing it so is that still the negatives is it still a negative signal if we get a wave of disrupted company um issues in the debt markets normally we would say uh-oh, that's a bad signal for the economy. But in this case, it might actually be evidence that AI is working and taking out the trash. Well, let me give you one piece of evidence for why you're right. Doesn't that twist your brain around a little bit?

Let me give you one piece of evidence for why you're right. And it's just one, but whatever. Two Fridays ago, when we got the really strong jobs report, I think a lot of the self was, oh, shit, is AI not working? Are we overspending? Right. We got a booming job support and the opposite happened. So I think in your scenario, it's plausible that we could, that the stock market could cheer

this on as horrible as that sounds. All right. So I guess what I'm trying to get at and then we can move on is the layoff piece too. Ordinarily, we would look at rising unemployment claims, jobless claims, and say this could be problematic. What if we have a scenario where the unemployment claims are rising? But that is contributing in and of itself to S&P 500 earnings growth because every laid off person is a higher profit at a public company. So it is a fucked up like, let me do this. That is a dangerous world that I, you know.

That would be a dystopian bull market, but what quite possibly a bull market, nonetheless, tech crunch. The AI layoff wave is becoming a powder keg. tech layoffs hit their highest single month in two years 40,000 cuts. This is the tech industry laying off its own workers. Other voices have begun to weigh in, including Mark and Driesen, who recently called AI the silver bullet excuse for layoffs. Really, this is about mismanagement. Quote, essentially, every large company is overstaffed.

It's at least overstaffed by 25%. I think most large companies are overstaffed by 50%. I think a lot of them are overstaffed by 75%, and now they all have the silver bullet excuse. Ah, it's AI. I sort of think just 150,000 layoffs in tech year to date. I sort of think the truth is somewhere in the middle. I don't think most large companies are overstaffed by 75%.

If AI is super effective, it might prove to be the case that they are in two years. I have a hard time believing these people, these executives who fight, tooth and nail for every penny in earnings per share are overstaffed by 75%. What do you think? It's hard to make general statements. I think that Jack Dorsey's company block or square, whatever the hell it's called right now, I think they were extremely, I think they overhired and they're not alone. There's a lot of examples of companies that just got lazy and fat and bloated.

Let me end this. What makes this, this is back to the tech crunch. What makes this combustible is that. at the very moment, tens of thousands of workers are being shown the door. A small cohort of AI insiders is becoming wealthy on a scale that's hard to comprehend. And then they do a whole thing about like we're creating like overnight billionaires with AI IPOs and stuff. I don't know if that's the thing that makes it combustible, but it is a sort of perverse coda. Oh, it is.

A lot of the Elon becoming a trillionaire type stuff. I mean, it's not going away. It's just going to get worse. the rhetoric around it. So I'm worried. I don't like it. I don't think I'm like it. If we get to six or seven percent on employment and you're like an open AI day one

employee who's just become an overnight billionaire, like you're probably rolling with personal security at that point. Yeah. So to be clear, I don't have a problem with Elon being a trillionaire. I mean, I understand why. Believe me, I understand why people do have a problem with it. But the thing that I, that worries me is. all of the rhetoric around it.

Like that, you know. But answer to that, people are crazy. Is personal security the new, the new bull market? Like the new obvious bowl market. Because if you're really going to have, if you're really going to have this thing where a million people have jobs at AI companies and are worth $50 million each.

And then all of a sudden, gutting white-collar unemployment at the same time. And, you know, who knows what happens with Autonomous for blue-collar employment. It kind of seems like it's either unsustainable or you're going to want to invest in bodyguard companies. Like, I know that's a dark place to go, but that's sort of what it sounds like it's going to turn out to be. All right.

Let's talk about software. I want to move off this. Jammin' ball tweeted, Q1 earnings season is just about. out done and this quarter has been great for software. Looking at the year-over-year growth and quarterly net-new A-O-R added, this was the best quarter by a long shot in the last five years. Now, there's like some base effects going on here. They're coming off a lower base, but whatever. This is the fact. He says this chart uses a basket of 50 public companies who report AOL or subscription REV. While the aggregate net new ARR was high, 17% of the companies saw

aAR shrink. This is the second highest percentage of companies who shrunk quote over quarter in the last five years. So the aggregate was great, but very high dispersion. So there's a great complimentary chart from A16Z showing big software moves, a three-part story. So this is hard to see, but what they're looking at, what they're showing is on top, the companies that never sold off and are trading near their year-to-date high. So all cybersecurity. We're talking about data dog, fortnight, crowd strike, Palo Alto, something on. And now, let's be clear, they did sell off. These were in bare markets. These felt 20 percent. But nothing like the ones that, partially recovered. We're talking about stocks like Catlation, Unity, service tight-in, workday,

service now, Oracle. These are the stocks that fell whatever, a pun, and then bounced to varying degrees. And then the other one is the stocks that went down and stayed down. And these are the ones that are like in the absolute eye of the storm of the red. Sorry, dude, Salesforce is going to replace you. And we're talking about Intuit, right, like TurboTax. We're talking about DocuSign. We're talking about Adobe and trot off, please. We have an ops offsite. We have, I don't know, 25 people in Chicago this week. And Chris sent me a PDF of the agenda for what's going to happen. And he said, remember graphic designers. That was like an actual quote that Chris sent to me. So Adobe reported this week. And Adobe's market cap peaked at $327 billion a couple of years ago. It's now $84 billion.

$84 billion. Now, Adobe is the graphic designing company. Oh, my God. And what's interesting is they reported earnings this week. What's not really awesome is they're looking to transition the CEO. They're looking for a successor and the CFO just left. So that's not great. But what's so wild is they said we achieve $6.62 billion in revenue in Q2,

representing 11% year-over-year growth. earnings are at an all-time high. Nobody cares. So nobody cares. 11% year-over-year growth, the stock is down 47% year-over-year, year-over-year. Earnings per share was up 18% year-over-year. And again, the stock is down 47% year-over-year. They spoke about the AI innovation.

They did three-x year-over-year increase in AOR to greater than $500 million. So, I mean, this is like so fascinating. I just want to fast-forward five years. Is this the greatest buy of all time, or is this just an obvious value trap? And the market is clearly saying the latter. This is a value trap. It doesn't matter what the earnings are today, next quarter, next quarter, next quarter, because in 10 years, at five years and 10 years, it's not going to live today.

And, you know, we'll see. Situation zero in the chat points out, Canva is eating Adobe. I know that there is some market share gains. And Canva came publics and now they have a stock price. I could promise you, what's going on is not benefiting Canva at all. They're taking market share gains in an industry where people think it's going to disappear. Look at Figma. So Figma's eating at Adobe's knowledge?

That's the one that came public. Figma stock is terrible. Perible. Go back to that first graphic with all the companies, guys. So they really think, like just based on this and it's not science, but they really think into it is the most f*** company in the software industry. Zee-Sk. Scalar ended up in the bottom.

And that is, so what's interesting about Z scalar, is that it's a, it's a cybersecurity name. And they don't think that one is scaled enough to be part of like the, I guess, the big four. They don't, they don't think that one's going to have enough about it that's unique, that it'll be able to hold customers. That might just be a competitive story. But it is never been tougher to be in a. software stock investor. I don't know anything really about the fundamentals of Intuit. I don't know much debt they have or anything like that. Let's see. It's turbo tax. You don't have to know anything. Hold on. Hold on. I know what it is. It's a $77 billion market cap. All right. I don't know much debt is on

here. Debt equity ratio looks pretty pretty reasonable. So this is this is turbo tax. It's it's MailChimp, QuickBooks and Credit Karma. And all of these, each of these are like AI, AI, Well, do it yourself tax filer who would be paying a subscription to TurboTax, just says to Claude, I always use TurboTax. Can you just tell me what I own taxes and help me with the filing? Oh, it's done in one second. Okay. Goodbye.

TurboTax subscription. Like, it's not a complex situation. It's as cut and dry as you could possibly imagine. I do wonder if Intuit is the type of company that gets taken private. The problem is, is it like at half the valuation from here? Is it at $20 billion? It's still $77. Yeah.

And that is one of the all-time, prior to this era, one of the all-time big winners in the software space. It just, it was a home run on top of a home run for such a long period of time. And just like that, natural language questions of an LLM. And you can get the same result as you would get logging into their. marquee flagship product. And they won't be the only one. Intuit was, Intuit peaked at $820

in 12, dude, 12 months ago. It was $820 a year ago. It's $2.80. Sick. $2.80 from 820. Look, either it's the status pitch in history or it's

or the market is right. And this is going to be a very difficult 10 year stretch for that. Last thing. All right. The biggest software company in the world is Microsoft. And somebody mentioned earlier in the chat, well, if you want to play OpenAI by Microsoft, the partnership, blah, blah, blah, blah. The problem is that software is just not.

Yeah, they're eating themselves. Right now. So look at this chart. Look at this chart. The ratio of Microsoft to the S&P and Microsoft divided by the cues, the cues especially, it is at multi, multi-year lows. I don't know. So the Microsoft has underperform the cues by a lot since at least 2019. I don't know how long this chart goes back where it's a break-even.

But, again, Microsoft is the biggest software stock in the world. But they have the cloud business. And the cloud business is booming. So it's not 100% software. In the same way, like Oracle is a software business that's, you know, building a huge network of, of AI data centers. So it's not that cut and dry in the way that Adobe is. The market, the market, correct, correct.

But the market is treating it as such. The market is saying you're the biggest software name in the world. Yes, there's other stuff, but you're in trouble. Okay. So like, why not buy Microsoft to play OpenAI? Because Open AI and their products and Anthropics, too, are coming for a lot of what Microsoft does. So at best, it's a push.

And I'm not saying this is how it will end up. I'm saying in the eyes of the market. That is how they're looking at it. Eric in the chat, co-pilot is a huge failure. That's a whole other narrative overhanging this thing. A lot of corporations are forcing this co-pilot down their employees' throats. And their employees are going around the back and asking people, hey, I'd really rather use Claude.

Is that okay? I use it at home. I like it better. So there's a lot of that going on as well. and it's, look, it's a shitty time to be in the software space. I own two software stocks. Neither of them are acting well. I don't expect them to anytime soon.

These companies are guilty until proven innocent. If you're a value investor, congratulations. You're in heaven. Like if you want to make the bet, you have never had a better opportunity to make the bet that we're all overestimating the impact. You can, every day, the stock is cheaper than the day before. Knock yourself out. And I hope it works.

Last thing we're going to do tonight is tech debt. Invidia is planning to sell $25 billion of investment-grade debt on Monday. That's the, oh, or it was yesterday. That's the first bond sale for Nvidia since 2021 during the pandemic. They actually upsized it from $20 billion after, this is the FT. after receiving more than $85 billion in orders by early afternoon in New York. Thanks to the robust demand, the 10-year portion of the bond was expected to yield 0.5 percentage points, half a percent above U.S. Treasuries, down from 0.75 earlier in the discussions.

They say they'll use net proceeds for general corporate purposes. They also are making a ton of AI investments themselves. they're using the balance sheet, they're using their cash to buy stakes in a lot of customers, which people have criticized, but that's another thing Nvidia is doing. Nvidia's debt outstanding will go from $8.5 billion to $30 billion when this is done. They have a double A credit rating. Hold on. That's like barely any debt at all for a company that size with that sort of, I mean, come on.

$96 billion in cash flow. Like, it's no big deal. No big deal. Goldman, J.P. Morgan, Morgan, Stanley, running it. Our friend of the show, Matt Phillips wrote about this at Axios today. Put up this chart. This is the net debt position of a handful of AI companies. What's included in here is Amazon alphabet and video, Oracle, Meta, and Microsoft. So we're at $158 billion. And just to put that into context, in 2020, that number was, minus 150 billion, so on a net basis, meaning they had that much more cash than they had in debt. Debt was almost non-existent amongst the tech giants.

This is the thing that we originally loved about these companies. They were not capital-intensive, with the exception of Amazon, and there was no need for debt because they were producing enormous cash flows. And to your point earlier in the show,

that has completely gone into reverse. 770 billion in CAPEX in 2020. 100% of cash flow from operations for those companies. And not only are they selling more stock in some cases, now they're selling a lot of bonds. And that is not a problem yet because they all have very high credit ratings. The last thing on this, Tony Pascarello from Goldman Sachs, quote, for several years, U.S. mega cap tech companies have generated, returned, and reinvested capital to an extent that no other cohort could touch.

I believe that will be the case for a while longer, but what has clearly changed is the capital requirement of AI so immense that free cash flow alone can't do all the heavy lifting. He says, put the chart up, in the aggregate, it's not yet time to worry about the inability of these companies to access capital. our work suggests the core hyper-scalers can add around 700 billion of more financing before their net debt load is greater than one times 2026 EBITA. So, of course, that's a very Goldman-friendly message from Tony at Goldman. They do want to be involved in selling more debt for these companies. Would you agree?

Sure, it looks that way. Oh, would I agree. Yeah, Goldman wants you. Yeah, I think they'd be interested in that. By the way, look at Goldman's stock. Yeah. Looks pretty damn good. Last chart.

Not all hyper-scaler balance sheets are created equal, guys. So if you want to screenshot this and look at it, they're showing those names, plus they added CoreWeave and Nebius. So those are considered neoclounds, right? Like the newer data center companies. And CoreWeave is a B-plus, according to S&P. Oracle is now a Triple B, which made a lot of news. Google is the only AA plus. Met is still a double A minus, maybe not forever.

Microsoft is still AAA, remarkable. Amazon double A. But look at Oracle. This is, you know, the market is not cool with this. They're saying we don't like it. Net debt to last 12 months EBITDA at Oracle is 4X. They're going to spend 132% of their cash flow on whatever that was, OPEX next year. It's a lot.

Yeah. Market is saying it's too much. Is the market saying it's too much if Google? For Oracle. And Amazon are still going up. I said for Oracle. For Oracle is too much. I don't know.

I really don't know what it would take for Oracle to get back to a tie. Oracle looks nothing like the other two. It looks more like four weave than it looks like the others. You're 100% right. Yeah. And S&P has already reflected that in this rating. There's no A in that rating. So, all right, we're going to do make the case.

And then Michael has a mystery chart for me. And we'll get out of here. I bought a stock today. I am now long Robin Hood. What are your thoughts? Can I tell you something? I swear to God, I was going to make the case for Robin Hood next week. Well, too late.

I told the boys yesterday. Hold on. I'll give you the mic for a sec. But my thesis was going to be, if you are and you wrote by the robots a long time ago, if you are in the financial services industry and you're worried about being displaced by by the robots, this is the robot to buy. Now, public hour sponsor is not publicly traded. Robin Hood is, but they're coming.

37% drawdown for the stock is where I pulled the trigger. Not like me. I don't even look at stocks in 37% drawdowns normally, but for a trade at least. But I like the way this thing is recovering. The RSI is now back above 60. The rebound looks real. Today they announced a 10% workforce

reduction in a filing, and they did not use the word AI. They did not even hint at it. Here's what they said. The company is taking this action from a position of business strength, including June month to date, average daily trading volumes at record levels across equities, options, and prediction markets. You know what I think they want to do? I think they want to right-size the workforce now.

they're having an incredible quarter to come out of the quarter and be able to give really good guidance for the second half. I think they looked at their stock below 100 and they said, fuck that. Now is the time to get back in the game. That's, I'm just,

we met Vlad when we spent two hours with him. I'm just like trying to mind meld with him from afar. That's what I think the mentality is. I think he wants a triple-digit stock price. I was going to say, oh, this helps. Give me the chart.

Bitcoin is picking itself up. And for whatever, for a good reason, Robin Hood's stock price is still fairly correlated, not perfectly, but fairly correlated to Bitcoin. Obviously, it's a lot of crypto trading on the platform. And when Bitcoin is in a free fall, as it has been, less people want to fuck around with other tokens and coins and crypto trades. It's a huge part of their business. Huge.

Here's another growing part of the business. Our friend Dan Dolev at Missouho wrote about prediction markets. He's got a note out saying prediction markets reach all-time high in May. And in addition to equities and options and all the things that are going well at Robin Hood, this is now becoming 9% of total revenue. So this is what Dan said. Prediction markets are the key positive. We now model prediction market contracts rising from $8.8 billion in Q1 to $13 billion by Q4 or $44.8 billion for the year and $57 billion for fiscal year 2027. Revenue from prediction markets is modeled at $464 million in fiscal 26, $570 million next year.

that would be 9% of total revenue, but 19 to 20% of transaction revenue, meaning it's not like earning money on cash or something stupid like margin loans. This is like actual action. So Dan says that is no longer immaterial. In our view, investors should see prediction markets as a new engagement layer. Do you think the NBA playoffs and finals were a big boost to prediction markets, not just at Robin Hood, but everywhere? So two things. Number one, I have to take the loss here because I was pretty public to Vlatt's face that I thought they were drunk on this stuff. Now that I was bearish on prediction markets, but the way that they were leaning in, I thought that they were overestimating the amount of interest. Obviously, I was wrong.

So guilty on that. It might be early. We'll say, yeah. But no. People could lose interest. So far I'm obviously wrong. When I was in Texas, I wanted to bet on the Knicks winning the game. The Knicks were five and a half point underdogs, and I said, I want the money line. I couldn't do that because the sports books are not legal in Texas.

So I went on, I went on Kalshi and I bet on Jalen to win the MVP. I figured if they were going to win tonight, Jaylon would be the MVP, the odds were better. But the state stuff, the state specific stuff is really interesting. It's a huge arbitrage, right? now. That's what's going on. So I don't know how long that lasts. And that is, that would have a material impact on these markets. You know, I was in Las Vegas. I was at the win, encore or some of the regular win, maybe the regular win sports, sports book for game one. I was in Vegas. I had to go to the airport, but like I caught

most of game one before I left. I walked up to the window in the sports book to place a bet on on the Knicks to win. And they said the game started five minutes ago. I'm like, all right, that's, that's great information. Thank you for that. I'm aware. She's like, no, no, no, you don't understand. There's no in-game bet in the sports book.

She's like, it's not like your phone. I'm like, oh, all right, I just pull out my phone and do the bet. She's like, yeah, I guess everyone else is. So it's an arbitrage. It's crazy arbitrage when you think about it. Maybe that's the bulk case. The states make money handover fist from Draft Kings and Fand and they make shit from these companies.

I promise you that ain't going to be for long. Can I put up, can I put up, can I put up, can I put up the technicals on Robin Hood? This is what I'm, so this is what I'm seeing. I'm seeing a stock challenging a falling 200 day, which is not bullish by any means, but bouncing off of a now rising 50 day. And I don't really see a lot of resistance until like 125, let's say, which this is a nice, I bought it at 95 and change today. There's a lot of room between here and that cliff from December.

What do you think about my trade? Do you like it? You're blessing it? Look at the RSI confirming 61. A lot of momentum here. What are your thoughts? Yeah, it looks good. Can I interest you in some shares?

Yeah, listen, I've been looking at it. I've been saying it. It was my making the case for next week. Well, don't just look at it. trade it. All right. No, I like it. I like it. All right. Here's my mystery chart. This is, I'll start here. I know we could, we could go deeper. Obviously, you saw the stock got pummeled. There were macro headwinds in 2022, 23, 24. And unlike the rest of this industry, and it's a large one, this is violating the narratives because this industry is supposed to be.

be doing really poorly right now. And this is a stock that I do want to buy. I want to buy this more than Robin Hood. Okay. I want to say it's housing or mortgage-related. Right, right. Housing-related. Stay on that.

Yep. It's violating the narratives. I mean, look at that stock. Look at that stock, dude. It's breaking out. So is this Lowe? No, Lowe's in Home Depot. Don't look like this.

I'm trying to think of what housing stock What housing stock could possibly look like this? It's a luxury brand. It's a luxury brand in homes themselves. I think it's a luxury brand. Oh, this has got to be some sort of furniture shit. Yeah. Restoration.

Is it R.H? No, that one doesn't look good. That's the other one. That one looks like death. All right. I don't have it. William Sonoma. There you go.

Jay Mintzwin in the chat gave it to me. I did not guess it. Okay. Thank you guys in the chat. Look at this chart. So what the story is, the story is they're buying back a ton of stock, like a ton of stock. EPS has inflected higher. And I, so I own Flore and Decor.

I think that people that are on the sidelines, rightfully so, because they can't afford a house or they can't mentally get there because it's just, it's too much. I think after three years of this, the fact that there are still 75 million people that are like 37 years old, I think housing might be turning a corner. I think people are just coming to the realization that, all right, I guess this is just what houses cost now. All right. I don't think so. And I'm going to correct something.

This is not a bet on housing in any way, shape, or form. This is the top of the top of decay. That's who's shopping at William Sonoma on a regular basis. And then regular civilians pop in there once in a while when they need a new pot or pan. This is nothing to do with housing. also the longer you're stuck in a house, the higher your propensity to want to redecorate because what else are you going to do?

Can't buy something new, can't build something. All right, I'll redo my kitchen. That's what William Sonoma is about. You're 100% right. However, look at Floor and Decor, which I do own, look at Home Depot, look at Lowe's, look at Sherman Williams. They have bounced pretty, pretty strongly. Now, it might just be a...

I'll give you another. Shark Ninja made a... Shark Ninja, made a record high. And shout out to the Baracca's family. I don't even know what this. They're from Long Island. Shark Ninja is the shark is the blender and the ninja is the vacuum or vice?

No. Oh. It's the shark vacuum and the ninja blender. Yeah, I have one of those. Okay. So is that a housing play? Not really. Not really.

It's appliances. Well, that's maybe sort of. It's appliances, but, and the appliances go in a house, but nobody would say that's a housing play. Here's my point on housing. It's not getting worse. The housing situation is not getting worse. It's not like rates are going to 7.5%. I think people are digesting the fact that housing is about as bad as it's going to be. And I think if you get any sort of lift, any sort of lift, there's a ton of leverage in William Sonoma, which I want to buy. What's so funny? Matt Static said William Sonoma is not for the salt of the earth. I don't know if he's joking about me not the salt. Yes. Yes. No,

Josh is a pot of your bone chopper, obviously. No, shawry is. Yeah. Guys, I want to say thank you so much for coming by for the live chat. This is a major show. We covered so much ground. Michael, you did great. Duncan and John, fantastic, as always.

Nicole, everybody, just all around. Thank you guys for rocking with us. We appreciate it. I want to remind you, first of all, we have the new compound hats in the store. We very rarely remember to send people to the store. I don't shop.com. Obviously, no apostrophe. I don't shop.com.

There's a dad hat version that we did for the summer in green. And then there's, I guess you'd call it a trucker hat version. Black with pink writing and it is sick. So go to I don't shop.com and get your official compound gear today.

Tomorrow is Animal Spirits of Michael and Ben. Do ask the compound this week, of course. And then we'll end the week with the compounded friends with a first-time guest, somebody we've never talked to before. We're super excited about it. Thanks so much for watching. Thank you for listening. See you soon. Ridholt's wealth management is a registered investment advisor. Advisory services are only offered to clients or prospective clients where Ritthold's wealth management and its representatives are properly licensed or exempt from licensure. Nothing on this podcast should be construed as and may not be

used in connection with an offer to sell or solicitation of an offer to buy or hold an interest in any security or investment product. Past performance is no guarantee of future results. Investing involves risk and possible loss of principal capital. No advice may be rendered by Ridholt's wealth management unless a client service agreement is in place. Hey, y'all, it's Kelly Clarkson with Wayfair. Ever order furniture online and wonder what if? Like, what if it doesn't hold up? That sofa was four days old. You should have ordered from Wayfair. With Wayfair, there's no what if. Just style you love and quality you can trust. Visit Wayfair. Wayfair, every style, every home.