The Compound and Friends - SpaceX IPO With Rupert Mitchell, Consumer Discretionary Is Not an Econ Signal, Halo ETF Launches

Episode Date: May 26, 2026

Join ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Downtown Josh Brown⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Michael Batnick⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ for another episode of What Are Your Thoughts and see what they have to say about: SpaceX IPO, Halo ETFs, consumer problems, a mystery chart, and more! Plus, a special appearance by Rupert Mitchell! This episode is sponsored by: DBMF and ClearBridge Investments. Find out why managed futures should be a foundational part of any alternatives allocation at ⁠www.DBMF.com/WAYT.⁠ Rising geopolitical tensions, continued market uncertainty, stocks backed by can offer more predictable cash flows as volatility increases. Learn more at ⁠https://www.clearbridge.com/⁠ 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/⁠⁠⁠⁠ DBMF Disclosure: The Fund’s investment objectives, risks, charges, and expenses must be considered carefully before investing. The statutory and summary prospectuses contain this and other important information about the investment company, it may be obtained by visiting www.imgp.com. The iMGP DBi Managed Futures Strategy ETF is distributed by ALPS Distributors, Inc. Learn more about your ad choices. Visit megaphone.fm/adchoices

We're getting roasted in the chat for being a minute late, Michael. What are you going to do, right? Aren't we doing the best we can? I always am. Okay. Jonathan 7768 says Josh must be combing his hair. You're not totally wrong. You're not totally wrong.

All right. Hey, everybody. Welcome to what are your thoughts? The world's greatest investing podcast, at least in my opinion. We are back because it is Tuesday. It's 5 p.m. East Coast. So you know what that means? It's time for an all-new edition.

What are your thoughts? And with me today, my co-host, Michael Batnik. Michael say hello. Hello, hello. All right. The live chat is going off right now. Happy Tuesday Compounders from Real Manning. Yes, I made it live.

Zeke 316. Welcome, brother. Joe Al-Tamoros says, well, what's up, Pounders? Daniel Cucks says Micron is bigger than Walmart and JPM. Combined? No. Can't be, right? Just bigger than, bigger than both.

All right. They had the change into Nick's gear, Biff Gribles. We didn't have to change into Nick's gear. We haven't taken it off. And I don't see it happening anytime soon. Tonight's show, we're going to get into all the biggest topics in the market. The economy, stocks, bonds, IPOs, interest, all the things.

But before we do, we have a sponsor tonight. Michael, who's a sponsor? That's right, Josh. This podcast is sponsored by DBMF, a market leading managed futures ETF. Alternatives should do two things, be uncorrelated to traditional asset classes and deliver strong performance.

But many alternatives don't do those things very well. That's where DBMF comes in. With its revolutionary low-cost approach, DBMF has grabbed the attention of savvy allocators looking to deliver both alpha-generating returns and genuine diversification to portfolios. Find out why managed future should be a foundational part of any alternatives allocation at www.com slash way-t. The fund's investment objectives, risk, charges, and expenses must be considered

carefully before investing. The statutory and summary prospectuses contain this and other important information about the investment company. It may be obtained by visiting www.imgp.com. The IMGP DBIM-MATM-MATF is distributed by Alps, Distributors, Inc. 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 as volatility increases. Position your investment portfolio for wider equity participation, with fundamentally driven Clearbridge active equity strategies. Clearbridge, a Franklin Templeton company, go to clearbridge.com to learn more. I think we really need to start with the SpaceX S1.

We sort of touched on a... What in the world? Who could that be? Oh, my God. It's Rupert Mitchell from Blind Squirrel Macro. How did you get here? Hey, Jen. So good to see you.

Good to see you. guys. It's so crazy that you're here because we were going to talk about some of your research that you've been putting out. What an unbelievable coincidence. We're so excited to have you. Thank you, Rupert. It's a pleasure. It's a pleasure. I pull my house out of bed for you guys anytime. All right. And you just happen to be in the neighborhood, aka in Hong Kong. So it works out Perfect. All right. It works out perfectly.

Let's get into SpaceX. You have been writing a lot and speaking a lot about the topic. And you've got a lot of experience in the investment banking world. And you have thought a lot about the sheer size of the, let's call it the opportunity. The basic argument, I'm going to quote you to you and then have you react. The basic argument that you're making here is that. a lot of people already own this stock. All of the people who are going to be speaking positively about it,

not only are they extremely long, but they're long from pennies. They own this thing, I don't know, from seven years ago, nine years ago, 10 years ago, is people with a cost basis that it's almost,

they almost own the stock for free. And that's a very important point. This is not as though venture capitalists, or Wall Street players participated in like a series D round two weeks ago at roughly an equivalent valuation. We're talking about people who are up huge. This is your actual quote. You are currently being submitted to a continuous barrage of propaganda. You must tune out CNBC bubble vision, rockets, Mars, wow, SpaceX has also co-opted the entirety of Wall Street. The assembled syndicate is probably looking at a fee pool of $850 million,

which is an underwriting commission of 1%. Let's put this graphic up. This is from Blind Squirrel Macro on Substack. This is everyone. I can't think of anyone that's not on here, to your point. There is one missing, Josh. Who's that? Jeffreys is not on there,

and they've got a very highly ranked aerospace and defense analyst. So keep an eye out there. Okay. Do we know, has there been any public comment about why they're missing or? No, but I've got my ear to the ground. Okay. All right. So tell us, tell us to start with why you think we're on the receiving end of this barrage.

Surely it's not because people genuinely think that they need to promote this. It sort of promotes itself. It's Elon Musk. Yeah. Okay. Well, let's I mean, the world is motivated by

constraints and opportunities and incentives, right? And right now, everybody is on one side of the incentive bus, right? Pretty much anyone who's anyone has had the opportunity to buy SpaceX and has bought SpaceX at significantly low evaluations

over the course of the last 20 years. And trust me, everybody owns it, right? There's not a sovereign, and wealth fund. There's not an institution. There's not a mutual fund. There's not a private equity shop. There's not a crossover hedge fund that doesn't own this thing in size at a much lower price than what is being offered to the market. Now, I don't want to, I have given views on valuation. You can read it in the note. I don't want to clutch my pearls around the government stuff.

I just want to focus on the size, right? So let's do the numbers. They're talking about a $75 billion dollar primary raise. By the way, 20 billion of that's going back to pay the bank. So that's not exactly a growth stat story. But $75 billion. That's just about four point. Well, what you need to do is you need to add the green shoe, the over-allocation option. So actually, they need to find a home on day one for $86 billion. Oh my God. In one shot. In one shot, one day in June, where everyone that's big. Now, trust me, there's going to be a lot of performative participation in this deal by big Wall Street names. They're just averaging up, right, by a tiny bit, right? So you have to tune that out. You've just got to look. I have no doubt that there are a lot of people that are

really excited about owning the rocket ship company. I have no doubt, right? And so first thing, how are they solving this? First of all, they are co-opting the passive funds, effectively. The rules have been changed with the NASDAQ, with the NASDAQ and the S&P and the Russell indices, this thing's going into the index as fast as humanly possible. Now, I've run the numbers, right, and I've looked at all of the funds that are both passively benchmarked to these indices and those that are sort of closet benchmarks. They're benchmarked against it. They can't afford to completely ignore it, right?

if you assume you've got almost full compliance, right, by the, well, full compliance by the passive guys, and reasonable compliance by the closet benchmarks, you get to a number of about $44, $45 billion of that, of that 86. Then, and this is quite an amazing stat, they reckon they're going to place 30% of the deal with retail, right? That's $26 billion. I don't know if that's 100 or 150 times more than has ever been placed at retail.

It's a staggering, absolute and relative number. 26 billion, and we were talking before we went live, you were saying, of the millions of deals that you've seen in your career, 5% to retail is considered risky or high. So I'll tell you a story. So, I mean, we used to get twitchy if we had to place more than 5% with retail, right? And then we'd go, well, that's great. If retail, if retail flips the deal completely, flips a deal completely, we've still got a 15% green chew. We don't really have, we need to just worry about

how tight the top of the institutional book is, right? Okay. And I remember this is, this is in my, my city days, back at the time of the Facebook IPO, I was running, I was, I was, I was doing US-listed deals out of Asia, think, you know, think Alibaba and others back then. I remember getting, getting the, I was on the chat with the guy that ran the Smith Barney retail network, just as the IPO was going out. And he was saying, hey, by the way, do you want any Facebook stop? I said, you've got something. I said, yeah, you can have as much as you want. And at that point, I went, whoa.

Yeah, that's not great. But we all know what happened to Facebook. Yeah. Opened at 40, ended up at, I don't know, 18. Okay. What if everyone just sells 10 shares a microphone? Boom. We pay for the whole deal.

That's a really good point, right? It's not as easy as that. So let's get to the scale point. So just to finish on the layout, right? That leaves 16. Assuming we get all the index guys, get that retail sticks, that's a big ass. You've got another $60.5 billion just to get to one times covered, right?

Then the next problem is, is that Vanguard, BlackRock, State Street, and Invesco, the guys that run the big ETS. well, space space isn't yet in the index. They can't come into the order book. So essentially, the hedge fund community writ large is going to have to warehouse this stock until this thing goes into the index and they're going to need to hedge, you know,

hedge that position. And the prime broker community has never supported that kind of quantum of warehousing before. You know, these aren't treasuries. This is a hand. It's a handoff. So if BlackRock, State Street, Invesco, the big index, ETF houses, they have to wait, it's 10 days?

Well, I mean, the NASDAQ 100 is going to be the first to admit, right? 15 days. 15 days. But that's, that's only $6 billion, right? Out of the 44. So there's actually quite an extensive wasting period, right? Yeah. Okay.

So the hedge funds are going to be the bridge from the IPO date until the index providers and all of the active funds that are mimicking the index de facto can come in and buy. So you have this two-week period where it's almost like, well, who else is left to buy it? And it's unclear what that's going to be. It's a bit like the Spider-Man mean, right? They're all going, no, I'm going to sell it to invest going, no, no, I'm selling it. I'm going to sell it. So, I mean, I think, you know, they're going to look around and all of their peers are doing exactly the same trade.

And I think that the risk managers at the big investment banks are going to be going, how much of this stuff are we really warehousing, right? Yeah. They're being paid a small fortune to do the deal. But, hey, I think this is hard. I think this is really hard. And then the other thing is, right, you know, that's to get to one times covered, right? you know, if this thing's going to, if this thing's going to pop off the bat, right, we need to raise what, we need to get to two or three or at least four or five times covered. You're going to

see some, I mean, listen, ignore the, ignore the noise because if you, if you, if you, if you, if you're hearing a number that's more than twice covered, that's, that's, that, that, that, that, that, that, that just isn't that kind of money going around. It's impossible. It's impossible. It's impossible, right? It's not five trillion in demand for a two trillion dollar IPO. It's impossible. Well, yeah. I mean, it's, well, where's it coming from? Two trillion market cap, right?

But you make a really good point, Josh, because if you read the S1 in a bit of detail, the lockup agreement reads like a sieve, right? Essentially, all of the ex-Elon floats, so that's 60% roughly

of the economic interest. You know, basically is unlocked by November. of this year, and it all happens in stages. Now, I'm not necessarily opposed to the idea of avoiding a cliff edge, a cliff edge vesting for insiders, because that looks like a sort of, you know, runaway locomotive coming at you. But what I'm saying is that as these guys get unlocked into the free float, and it happens much faster than normally happens in an IPO, there's just going to be constant supply to absorb

any any and you know any people there's constant supply to support support the passive index demand that's coming in so it isn't a short squeeze on the passive community there's going to be a not more than enough stock for them to buy as as these shares become unlocked so if you think this is some kind of opportunity to play a short squeeze on the backs of the vanguard's

and the and the and the and the and the investos of this world I think think again it's 3% of the float trading or something? Out of the gate, 4.3%. But, you know, you have got shares coming into the float incredibly quickly, right? Okay. Within 30 days, right? Then if the share price performs by 30% from IPO price, a whole load more gets unlocked.

So just as this thing's really getting going, there's a whole load more stock that comes out to hit. It's not a six-month lock-up, which is what investors are accustomed to. It would be a typically a clean 180-day lock-up, right? Why don't you think the market is big enough to absorb this? Or do you? I don't want to put words in your mouth. No, I actually am, this is where I'm really concerned about the broader market right now, because top-of-book liquidity and equities is not what it used to be, right?

And actually, I don't know if you follow the work of Mike Green on passive. You know, you've got this inelastic market effect coming into play right now, whereby, you know, 44 billion of, 40 billion of money that needs to be raised from those passive funds to fund their participation is going to create an awful lot of damage on the top of the, on the top of the S&P, right? You know, all that liquidity vanishes any kind of, any kind of pressure. And if you've got all of the passive guys trying to sell 50 bits of Google or invidia. Or inviator alphabet, who's picking up that tab? Right. How much money is coming into index funds on any given week? You know, you get the drip, drip, drip of the 401K blows every month.

You used to have the drip, drip, drip, or the suck, suck of the buybacks every, every month, provided you weren't in a... Now, the hyperscales are all spending money on... on data center CAPEX right now. So that bid has gone away. You know, you've got people worried about their jobs in 401K land. So, you know, there is, there is, you know, I think that could go and that, that could become a net supply of equity into the market over the next year.

So all of the positive US de-equitization dynamics that we've lived through for the last 10 years, like the perpetual money machine, a lot of that stuff is, well, I'm not saying screaming into reverse, but maybe kicking back into neutral right now, which is a really bad time to be really testing the debt of liquidity. I want to do one of your charts real quick. To the first point you made, all of the people that we're going to hear from are super long from a super low price. Put this SpaceX stock chart up. So with the caveat that obviously this is privately held, but it's, I mean, this is the perspective. So this goes back to 2020. And you could see that this company had a valuation of a couple of billion dollars. What do you think the valuation

was in 2020? 20 billion. It's a fraction there. I don't know if you've got the other chart with the cat table. No problem. People can look it up. And by the way, all of my stuff on SpaceX is, is completely free. Anyone can, anyone can take a look at it. But, Essentially, I think the really important point here, guys, is that for this $2 trillion company, have a guess what the total quantum of equity checks written to it are over the last 20 years. Uh-uh. Is it like a stupidly small number? A billion dollars?

No, no, not that stupid. Like just under $11 billion. That's it. Yeah. Well, all right. Well, this is why everybody loves Elon. He's like how much money he makes people. He's the best stock promoter that ever live, right?

And he's a decent, decent company runner, inventor, whatever. Like, I understand that there's a lot of parlor tricks that he plays that pisses people off. But like, he's done some incredible shit. Let me ask you this, Rupert. And I'm not like a Elon stand, far from it. But I think credit where credit is due. So I think everybody understands what you're saying. And I would encourage listeners to go read the piece because it was excellent, very, very well done.

whenever people speak about or call some warning shots, which is very fair game, nothing that you're saying is like hyperbolic or inaccurate. There is going to be a lot of supply hitting the market. I'm going to put you on the spot and not to make you look like a jackass, because I'm genuinely curious, the level of concern. Zero, you have no conviction, 100, you have all the conviction in the world, that this is going to go south for the broader market. Like, where are you in your conviction on that?

15 to 20 delta roughly what does that mean 15 to 20 percent chance okay so this get really nasty which is a high which is a high which is high which it's high it's high it's high when you think about the stakes around that around this transaction right it's enough to be pretty wary right and you know people have not got their left tail they haven't got their downside insured right now it's just it's just something to keep a close eye on now personally you know I am I am almost in the camp where I think this is too big, right? I think that this might not happen. And let's agree, let's agree on one thing, right? It makes sense for all of the Elon companies to be under one roof, right? Ultimately, the car company's got to go with the rocket ship

slash AI company and all makes sense. This is tinfoil hat territory. But, okay, let's get nuts. Let's get nuts. So Goldman Sachs, my former employer got appointed left leave. Now, Morgan Stanley has been Elon's banker over the last of years. They went through a ton of pain. Michael Grimes. Michael Grimes, financing the Twitter buyout and were left holding the bag in terms of the LBO loan for a long period of time. And that must have been really painful. And then suddenly, you know, just because apparently DJ Sol slides into Elon's DMs on Twitter, picks up the, you know, the, the trophy equity capital markets mandate of all time, right? Lead left on the SpaceX IPO. I just wonder, I just wonder if Grimes is working on Plan B in the background. I mean, he gets, he gets, he gets,

to be lead advisor on the shotgun marriage of SpaceX and Tesla when they realize, he gets to represent Tesla. He gets to represent Tesla. Yeah. Okay. I mean, it's, I mean, it's, advisor on the combination. Listen, that's crazy. It's a 1% probability priced on polymarket right now of a Tesla SpaceX merger announced by June 30. 100 to 1 shot. I think that's, I think that's, I think that's worth doing. It's worth crazy. Crazy your things have happened. Can I have Rupert's SpaceX IPO layout analysis? So, no. No, that's not it. That's something else. But that shows SpaceX on the chart.

Yeah, that was a why. So, yeah, but this is great. This is great stuff. What are we looking at? So this is incredible. And the red number toward the bottom, middle, the shortfall. So I know you gave us the 50,000 square foot view, but basically like, that's the dollar amount that you think we don't know where it's going to come from to get to the amount of money they're raising.

I'm being pretty charitable, right? About that $42 billion. That 30% sticking with retail, right? And also giving full credit to the past. massive demand with the proviso that that's got to find a warehouse, right, before the passive guys can buy it, right? Right. Okay.

So you have to stress that about it. And anyone can download this from the, from the research piece. Rupert, I have a question for you. Obviously, I hope you're wrong. And not because you don't seem like a very lovely guy, but nobody wants you to be right, right? Okay. I don't want to be Pollyanna either. I mean, I just, I'm just, you know, that's why I was asking how much conviction you

act. I feel a lot better now. If you were saying like, no, I've been in this business a long time. I've done these deals 90%. I would have said, all right, Josh. So I feel better about that. But let me ask you this. I would have thought that if this was going to go south,

then obviously it might. We'll find that in a couple of weeks, I probably would have thought that shares of Tesla in anticipation of raising money to buy this deal, I probably would have thought that shares of Tesla would sell off in front of this and it hasn't. Does that is there any signal in there to you whatsoever? So, you know, for me, the the mid-curve trade into the SpaceX IPO was to short the hell out of Tesla, right?

Because all of the fanboys were going to migrate into Musk's favorite baby. Raise capital for the new one. That's the one thing that makes me think that 1% polymarket price on the merger is the wrong price, right? Okay. because, because it, you know, the shorts would get completely run over if that trade happens, right? Yeah. So that, that, that, that makes me pause for thought, certainly. Yeah, I mean, I think that there's an interesting dynamic just, if it happens, right?

Think about all of that transit. You've got, you've got 60% of a two trillion rising company transitioning, you know, transitioning into the passive world, right? Because all of these guys that have got these really low basis, they've made their 40, 50, 60 baggers. They're selling now, right? Yeah. You know, they've got a, in most cases,

they've got a fiduciary obligation to sell now that they've been in the investment for 10, 15 years. And this one, you're going to hate Josh, because I know that you don't like equal weight indices. But I think that, I think that the RSP, the equal weight S&P, is going to outperform the Mag 7, right, until this deal is fully seasoned, right? That's my prediction. How long is the seasoning is, what, two years before they...

It's going to take nine, twelve months for this all to sort of equalize, right? So even if I'm not predicting sort of fireworks of, you know, doom at 11, which I'm I think there's a risk, right? But I think if the syndicate and everyone thought that that was going to happen, right, I think they would move to Plan B pretty quickly because, you know, there's a lot of people that have got a lot of skin in the game here. And, you know, it's the investment banks prime broker balance sheets that are going to have to support that transition to the passive funds.

And if they're worried about liquidity generally, you know, that's going to contribute towards a plan B. I want to ask you, during the Snowflake IPO, this was a situation. So this is the fall of 2020. It was the biggest IPO ever, I think, at that time or maybe like neck and neck with Alibaba or something. But like, it was huge. And a lot of the hedge funds that were sort of had like a VC bent to them, I don't know,

the D ones, the twos that, yeah, those guys. Yeah. So what they ended up, some of them ended up doing, rather than make the sell decision or the hold decision, they distributed the stock to their LPs, which is the third option that people forget exists. Yep. Depending on the fund, many funds have the ability to say, you know what? We don't know if it's the right time to sell snowflake.

We were smart enough to get you into it 100 X ago. And now we're going to put that decision in the hands of the LPs. We're actually going to distribute the shares that they got. Do you think in a situation like this where. like everybody understands that this is the ultimate unknowable like there's no multiple there's no real cash flow like everybody gets that this is pixie dust do you think there will be a higher likelihood um of of funds just saying as soon as they're able you know what you figure it out like you made you money take it i think i think i think that would be the right thing to do

that's what i do doing it's the i that's what you would that's what you would do if you you were running off on that owned this. Because the insider stock is all loose anyway, right? So you're not protecting your investors by staying strong and, you know, keeping the float tight. That's all loose. So you should absolutely distribute in specie this investment to your LPs and say, right, you call it, right? This is a stock at 100 times revenues.

You know, that may make sense in some. universe. And we can talk about universities here. Okay. Last one I wanted to ask you, do we start saying Mag 8 right, like right out of the gates? Because this is, I think, instantly going to be five or six in market cap. And as sort of an ancillary, a lot of people are saying Nvidia is the thing that's going to get sold the hardest for, in order for people to own SpaceX. I don't know why, but I'm seeing that everywhere. Do you have any insight into why people think that? It doesn't make a great deal of sense to me. I mean, you know, Elon with a lot of money, building building colossuses and colossuses too. And he's a big customer. He's going to keep the flywheel going for Jensen, right?

Yeah. But I just think it's, I wouldn't try and single out. I'd keep it much more high level. Look at. you know, long RSP short mags, right? And I think that, I think that, I think that works as a, as a trade. Once this thing's priced, you know, once this thing's out of the gate, then the machinery's rolling now. And that is just going to put a huge amount of pressure at the top of the stack on the top of the top of the S&P. Okay. I, I told you 15 minutes. We kept you for 30. I, uh, I can't tell you how much the audience and I and Michael appreciate having your insights. This is obviously a major historic moment for the stock market. And your writing has been really making this much more clear to people that don't have insights directly into these types of deals. So we really appreciate it.

Thank you so much, Rupert. Thanks so much for having me on, guys. That's been fantastic. Of course. And guys, we'll drop a link to Rupert Substack. It's a Blind Squirrel Macro. And he's also got a podcast. So if you enjoyed learning from Rupert the way that Michael and I have, there's more where that came from. Thanks again, Rupert. Have an awesome day. All right. Thanks. What do you think? You know, it's interesting. I thought that a lot of the narratives that I'm seeing out there are an artificially low flow to inflate the stock. Yeah. And then the index inclusion is just further pumping. So you know what? Who cares what I think? Throw up this polymarket thing. By the way, this.

to me, this is the vision and the premise, in my opinion, of prediction markets. This shit can't be gamed. Nobody knows where this is going to lay. But I take a decent amount of signal in something like this. I think this is very cool. The dollar amounts are tiny, though, still. I wish they were bigger. I mean, well, they'll get there.

They'll get there. But it's not nothing, dude. So most of the money is, and this is the closing market cap, I guess, on day. I won. Most of the money, and to Josh's point, it's not a gigantic, but it's $143,000. It's not nothing is between $2.5 trillion. Okay. So that's where the market on polymarket has settled out in terms of people's expectations

of where this thing will. So that would be bullish if that happens, frankly. No? Yeah. So there was two different conversations that we were having with Rupert. One is what happens in the first two weeks in terms of like who supports the float until the NASDAQ 100. comes along and starts to buy.

And then longer term, I think the valuation stuff to me is kind of boring. He didn't even want to do that. Right. We all, like, everyone said, anything that you could say has already been said.

The mission, the mission did read a little we-worky, the consciousness of the, the hell would we say. Read it. Read it. Our mission is to build the systems of technology is necessary to make life multi-planetary,

to understand the true nature of the universe. Come on. And to extend the light of consciousness to the stars. All right. The light of extend the light of consciousness to the star. All right. I'll buy the crystal. Right.

So Eric Newcomer said, this may be one of the largest leaps of faith. Musk has ever asked investors to take. What a great tagline that is. That's like for a movie. It's good. And you know what? I'm so excited to see how far they leap with him.

Like he is a singular inventor, creator, founder, entrepreneur, carnival Barker. like he is a one of one. I was going to say it's like a combination of jobs, Edison, but then also P.T. Barnum, right. But also PT Barnum, like all rolled up into one. He's a one of one. So here's another good quote. And think about something clever to say.

O'Mallick said at $1.75 trillion, SpaceX is asking investors to price in the orbital data centers, the Mars mission, the chip manufacturing, and the plan to build the infrastructure of a type type two civilization. The believers won't know the difference. The faithful have been well rewarded before. They have also occasionally learned that their Messiah is known to blow air hotter than the exhaust of those rockets. Well done, sir. So I said this on TV the other day, not in defensive Elon or not that anyone cares if I defend them or not.

But he does deliberately do this thing where he says self-driving cars in three years and then seven years goes by and they don't exist. Yeah, they're coming. But he has, I don't know if this is in the Isaacson. But he has like explained that. He's like, well, if I give a realistic timeline that's further out, then everybody just takes their time. If I put a more ambitious timeline up, people break their neck to get there. And they may not get there. But imagine if they weren't killing themselves to get there, how long everything would take.

So there's a methodology to this. It's not crazy or it might be crazy. But this particular thing that he does is. There's a point. I guess there's a point to it. And it's not random. You need to be a little bit crazy with your goals in order to raise the amount of capital that he has. Here's another really good one. And this is the stuff that pisses people off. Musk's company, this is from, I think I pulled this from the journal. I can't forgive me. I can't remember who I pulled this from. So SpaceX bought, this is nuts, dude. SpaceX bought 131 million dollars of cyber trucks.

What are they fucking Armageddon? Remember of the movie Armageddon? They had the cyber truck on the planet. They bought a million of them? $131 million of cyber trucks at the manufacturer suggested retail price. He can't even get a discount. Here's another one. Okay, in 2025, SpaceX also purchased $506 million worth of megapack energy storage products from Tesla. Meanwhile, Musk's XAI has paid Tesla about $731 million since the business.

beginning of 2024 through February 2026. It's funny. A lot of people, myself, included, thought that I thought Starlink was the company. Like, I really thought that that's what it was. That was like the backbone of this company. And apparently he's, he's selling it like, no, forget about Starlink, not forget about it. But it's, it's, it's the enterprise application of the, at the AI level. It showed this Tam that he made, $22 trillion. So Starlink is whatever. The Starlink broadband is, is sort of an afterthought. I thought that is the whole company. It is the whole company fundamentally. It's the only, it's the, you know, there are NASA contracts and then there's the Starlink revenue. But like the, the, the cash flow is

coming in from Starlink, which is hugely successful and is not even close to full penetration of its own individual Tam. And really doesn't have, and really doesn't have any competition to speak of. It's got companies that would like to compete and might in five years last week. We talked about, Amazon Leo and, you know, some of like the, some of the things holding them back, starting with they don't have their own rockets. They have to rent space on other rockets to put their satellites in space, whereas Elon's already got 8,000 satellites in orbit. Not a pipe dream.

It exists right now. I have a sign. So like Starlink is a great business. But he has always done this where he's bootstrapped the growth of the company from like a starting point of like here is some revenue coming in that we can then build on. Like that's not that if you're if you've been long Tesla, then you recognize this playbook. He's not selling this as though Starlink is the end point.

Starlink had 2.3 million subscribers at the end of 2023. The year later was 4.6. Then it was 9.2. Now it's 10.3 million. You know, I said this to Ben on the pod today. I love people that do the work. There's a lot of people that read the headlines and they look at the numbers and they don't read shit.

And the one that got all the headlines or all the attention was Starlink's ARPU, the average revenue per user going down dramatically. And people like, what in the world? You got to be kidding me. Okay. Well, thankfully, we have people like O'Mallek, who actually took the time to read it. And he said, there's an explanation for this. It started with maritime terminals.

They paid between $250,000. The highest paying customers. Yes. And then it was in the airplanes. and they spend $12,500 to $25,000 per month. He said, consumer residential is where the growth is now. It is the lowest paying tier and outside of North America, increasingly price sensitive.

Fast forward. So the mix explains- He's selling this to households in Brazil. But he said they're not paying what the original buyers were paying. It's not a mystery, is my point. That mix explains the slide from $99 to $66,000 in $3 years. maritime and aviation grow slowly and pay well. Consumer grows fast and pays less each year.

But I think the bigger point that I am genuinely so curious to fast forward, how does the market absorb all of this supply that is coming? And yes, it's a $2 trillion market cap. The float is relatively small. The numbers are big, $50, $75 billion. But to Rupert's point, like, if there is success early on, it unlocks more float faster and what might that do to the market? So chart can made this chart.

This is not inflation adjusted, but whatever. Not whatever. It's not inflation adjusted. Okay. In the dot com bubble, what fueled the bubble was a true, and Josh, you were there, a true IPO mania. Yep. Like an unsatiable amount. Like three to five a day, five days a week.

Okay. So in 1998, the U.S. markets, the U.S. IPO has raised $34 billion in money, and then 65 and then 65 the year later. from 1998 to 2000, nominal dollars, SpaceX Open Ionthropic are estimated to surpass all of the money raised in those three years. Yeah. And these are the big difference is obviously the quantity of deals was much higher then, but lower quality. Not that I'm saying like these are all high quality or there aren't issues with these. Those were people would, people would bought, would go to Veracine. and buy a URL and call Goldman Sachs and start working on IPO paperwork.

Like, it was literally like, we just, we launched a website. You also had existing companies build a tracking stock for the online part of their business and IPO that. So like a really funny example, Donaldson Lufkin, Genrette, DLJ, sort of like a smaller version of Goldman Sachs, but it was a big deal 25, 30 years ago. They had an online brokerage website, barely any customers. They called the DLJ Direct. They IPOed it. Like, you could do that just because it would be like a way to raise equity capital to build your website. So we just, we just had, I don't know, a thousand IPOs and most of them were kind of a

joke. We had some good ones, but most of them were a joke. So coming back to today, I think that, listen, I don't know if this is going to be a top or, or the obvious, I feel like in hindsight, if this is a top, this would be with the benefit of hindsight, the most obvious top we've ever seen. Which is why I have, that's what exactly what you just said is what I have in the back of my head. It's too obvious. It's too easy. It's too, how could it be so obvious that the biggest IPO of all time coming public via the

biggest showman of all time who will literally say anything. And every big, every major investor is already looking for the exit. They've been in the stock forever. Like, how could this, how could it be so obvious? Of course, it won't be the top. You know, you know the breaking bad scene where Mike is like, you stupid bastard, we had it all and you f***ed it all up or something like that. Yeah.

Oh, is that how we're going to look back at Elon is like, you dumb asshole. What you did? the combination of this anthropic and open AI or going public inside of the year, it might be too much. It might be too much. I don't know. You know me.

I'm the primary. Where's the money coming from, guy? Like, this is my whole thing. So for me, I just don't believe that there's $2 trillion on the sidelines. Stop saying that. It's not $2 trillion. That's the market cap. It's not the buying power.

I understand. I don't think there is $80 billion for him. There's another $40 billion for Open AI. We will find out. We will find out. We will find out. It does sound like a lot of money when you put it that way. I don't think it's in cash.

I think it's, it's got to come from somewhere. Where's going to come from? If they sell my stocks to buy this thing, I'm going to be pissed. All right. I like your next topic. All right. This is one of those things where this is, we're going to provide a service to the public. We're going to put an,

end. We're going to put an end to something that too many people do. Way too many people do. They look at the consumer discretionary sector of the S&P. And then they look at the consumer staple sector of the S&P. And they tell a story about the economy. And it's fucking nonsense. It's a great intuition. Like, oh, if we look at maple syrup and and canned fruit, that's like the stuff people have to buy. And we compare that to the things that people might want to buy, like leather jackets and pickup trucks. And we can sort of see like the priorities of the consumer or we can see how the

institutional investors are betting. Are they buying the staples because they're worried or are they buying the discretionary because they're bullish on the economy? Throw it out. It's garbage. It's always been garbage, but never more so that it is right now. Here's what I want to show you. This is the consumer discretionary ETF.

Just the price. Okay? It is at or close to highs. That's fine. Let's not use this as a story to say that the consumer spending appetite is this or it's that or it's the other thing. Because when you actually decompose what's in here, you realize this is just being led around by two very large, very important stocks.

But I want to make a different point, which goes a little bit further. This is the Staples, ETF. Put this one up. And we're dividing it by the, excuse me, we're dividing discretionary by Staples here. So it's a ratio chart. So 1.4, the way to think about that is 40% move by the discretionary versus the Staples. And a lot of people would look at that and say, well, that's indicative of how strong the consumer is or how good investors feel about the strength of consumer appetites. Do I have you so far?

You with me on that so far? These are the things people would say? Okay. All right. Now when we take a look at the equal weight consumer discretionary, this is going to control for those two gigantic stocks, which I'll mention in a second. that's the purple line. So now obviously doesn't look as good. So we're comparing this to the consumer discretionary,

the regular sector is an orange, the one that everyone talks about. That, of course, over the last year is up 16%. But the equal weight is up only six. And so if we're going to say that this says anything about the consumer, we're going to have to say that the equal weight is the more legitimate. I don't agree with the premise that it's saying something about the consumer, but I would say, like, if we have to, let's at least equal weight it. And here is why. This is the price of gasoline is in blue up 58% of the last year. And what you can see in this chart is that the orange line, which is just the regular consumer discretionary sector, holding up pretty well. And the purple line starting to break down right around the time. that gas prices really accelerated.

And that's not an accident. I think that is the true state of the consumer discretionary situation is in purple. And I think the driver of a lot that happens in that equal weight index is the price of gasoline. Not the only, but right now,

the most important one. This comes from Ed Yardinni. Give me the next chart. I want you guys to understand what's actually in the consumer discretionary. 10% is apparel, retail apparel. So this would be like Abercrombie and Fitch and Lula Lemon and Gap. Then we've got like all retailers 9.3%.

And then when you look at everything else in this index, this is year to date. This is year to date. So all of that gain is coming from those two categories that I mentioned. Everything else is detracting. casinos are down 17% Auto parts are down 13 Home improvements down 10 Even hotels, resorts and cruise lines

are down almost 10 Home building, we know the story there It's shit Restaurants are down Automobile manufacturers Which are also in discretionary Are down This sector is not in good shape

It's being artificially propped up Ed points out Give me this next chart This is market cap and and the earnings. And we're talking about the share of the index. So the sector is 9.8% of the S&P's market cap. Next chart shows you Amazon and Tesla, which are 62% of the market cap weighted consumer

discretionary. 62. And rising pretty much every week for the last, I don't know, the capitalization share is in blue. So that's the percentage of them. So in 2018, they were 18%. Now they're 62%. They're almost the entire average when you think about that.

And last one. This is just breaking it down in cap size. The S&P 500 is in blue. This is the consumer discretionary stock price, but by cap size. So the discretionary names of the S&P 400, those would be mid caps. That's in red.

They look much worse than blue. and then, of course, small cap discretionary in the S&P 600 look the worst, actually are negative versus versus 2021. So the more you go down in cap size or the more you equal weight, the more the consumer discretionary theme comes back down to Earth. And it's all being distorted by those two gigantic stocks that are now almost two thirds of the index. So doing ratio charts, doing storytelling, surrounding,

surrounding like consumer discretion and consumer staples, it's always been nonsense. But these days, what you're really saying is, you know, stocks versus, stocks versus two gigantic companies. And that's my, that's my shit. I agree with almost everything you just said. I don't think it's always been nonsense. I think there used to be simpler.

times the market wasn't as dynamic and it used to make a lot more sense than it does today. But I completely agree with the premise of looking at these two areas of the market and concluding anything about the economy, pump the brakes. Here's why. Look at restaurants, for example. A lot of them are doing really poorly. Oh, the consumer must be not able to afford a lot of these prices. Yeah, partially true. Obviously, it's a part of it. Part of it is an inflation story. You know what else is part of this story? Supply, valuation. The valuation is, a lot of these quick service restaurants were so stupid that they're now normalizing, comps are tougher, there's too many sweet greens and cavas and the Miami Pura V.

The competition tells you nothing about the consumer. Okay, that's number one. Another area worth looking at or thinking about is the performance of the stock might tell you the opposite about the consumer and who knows in which case. So, for example, is dollar general, would dollar general or dollar tree be ripping because the lower end consumer is in good shape and they're able to, buy more stuff? Or would Dollar General be doing poorly because people that are trading down can no longer,

like where else are they going to go? Or, or a third scenario, no, the consumer is doing poorly, but the middle class is now trading down and therefore the stock is performing better. Like, it's so messy and you can craft. Middle class people are going to Dollar General. Therefore, the economy's bad, but it helps Dollar General stock. Yeah. Okay.

It's just, it's very convoluted. Stop. Yeah. So I think you have to, you. really have to look under the hood with this one. I totally agree. Yes. And for God and for God's sake, again, Tesla and Amazon are almost two thirds of the index. So you're not saying anything about the consumer. You're saying something about whether or not people want to buy those stocks or not. Amen, sister. All right, let's skip topic through that's Evergreen. We could do that next week.

Let's do, you want to do immune to the news? Or do you want to skip up to? Well, this was just a question I wanted to ask you. Okay. Are we immune to the news, Michael? No, no. No, no, I reject that. Okay. This is the way I wanted to phrase it, though.

You have Iran, whatever the fuck is going on there this week. It's either a ceasefire or going to wipe them off the earth. It's like one or the other. A truce or World War III. Okay. Oil prices related. The Fed now on hold, maybe hiking, also related, inflation-related. Tariffs, sort of orthogonal.

all of these things, though, have basically become background noise. We made a record high last week. The Dow is over 50,000. So you can't tell me that people are actually reacting to the news in any meaningful way. I think they're just ignoring it. The next thing that's going to have, I bring this up because I think, like, in a few weeks, we're having the midterms conversation. I don't want to have it.

I don't either, but it's going to happen in the market. It's going to be in all those stupid. We're going to start whipping the stock market back and forth. The Republicans are going to lose the House. What does this mean for tax reform? What does this mean for this? What does it mean for that? That's going to be like the market conversation.

And part of me feels like, oh, that's going to be so annoying. But then part of me is like, actually, no, we're just going to ignore it. We're ignoring everything. Maybe this will be the thing that we don't ignore. I don't know. What do you thoughts? Yeah, no, I just disagree with the whole premise of we're ignoring the news. the reason, and you say ignoring it because with the backdrop of the market is out at the

all-time high and therefore we are ignoring the news. No, that's the part that I reject. The market is on an all-time high because earnings and profits are an all-time high. The market will be going- Therefore, we're ignoring the news and focusing on earnings. That's the question. That's what I'm asking you. The premise of that, and maybe not you per se, but when everybody's saying, why aren't

we reacting to this and this? Why are we ignoring everything? We're not. We're focusing on what matters. And investors are focusing on the bottom- Stop. I agree. But that's, you're not disagreeing with me. I know you want to. You don't like the premise, but that's what the premise is. The premise is, yeah, there's shit going on in the Middle East. There's geopolitics, whatever that means. The market doesn't care because it's focused on fundamentals, not news. Correct. The fundamentals are the earnings. Yes.

So we agree. The market is better than ever at tuning this all. out. I don't think Kevin Warsh got even a 24-hour cycle, like in the minds of the average investor. We used to talk about the new Fed chair like it was the new Pope. This is so much better. And we were Catholic. It's like, all right, new Fed chair. It's Trump's son-in-law. Who is it?

Whatever. I don't care. Next. Like, we're not doing these news discussions anymore in the stock market. And I'm sure at some point there would be big enough news. There's a guy outside the White House like two days ago firing an automatic rifle. Do you even know that it happened? I saw that briefly.

Could you imagine if that would have happened in 1997? No, it's crazy. Like it would have been on the news, like it would have been on the news for five nights straight. So I think I'm sure something crazy is going to happen and that's going to make this look crazy. crazy what I'm saying. I think we're sort of like in a post macro geopolitical news backdrop for a little while until something gets extreme enough. It's because the AI story is so all encompassing and engrossing. Yeah. All right. That's all I wanted. That's all I wanted to ask you on that. All right. Let's skip everything else. Let's just go to your make the case. We could do the MacLand stuff

on TCAF. Good idea. We have a good guess for that too. this week. Okay. Oh, I did want to mention the Halo ETF. So this actually ended up happening. We got the Halo ETF finally began trading. And I have to read a disclosure because I am involved in it. Halo is offered through Roundhill Financial.

I, me, Josh Brown, have a outside business activity where I act in a limited consulting role for Roundhill to advise in their marketing efforts. investing involves risk, possible loss of principal capital. Nothing discussed should be considered personal financial advice or a solicitation. All opinions are expressed on my own, not the opinions of Redoubt's wealth. The way that they built this, I have the top 10 holdings. So basically, it's a rules-based strategy. Roundtail is the ETF company behind DRAM, which I think is the most successful

ETF of the year. and they've done some other thematics. What jumps out at you about this top 10 holding screen that we have up here? Obviously, you have a limited role because I see this is equal weighted. So, of course, they don't care what you think at all. They don't care what I think. No, I didn't create the index at all. I know, I know.

I'm teasing. What jumps out to me? These are names that these are not individual stocks anybody buys, except for Philomores. Okay. So for people listening, AutoZone, TFI, Cummins, JV Hunt, Lamara advertising, Lennox International, Rider System, Magna, Philip Morris, and Auto Liv. I would say nobody in our audience owns these stocks individually except for maybe Philip Morris. Philip Morris is out. Yeah. So, no tech, no financials. And in fact, the index was built by a company called Acro. which is an index provider to the ETF industry.

And financials are explicitly ruled out of being owned by the HAL-E-F ticker is L-O-H-A, by the way, for people that want to check it out. Apparently, HALO was taken by a biotech company. Can't own financials because the rules that they're applying to determine heavy assets, low obsolescence risk, don't apply to financial companies. Right. There's one tech stock in the index, and I've never heard of it. Right now, the index will change, but right now the companies that made the criteria,

and there's one communications services stock. That's it. So in other words, like tech is one percent communication services, one percent. I think communications is charter. We need to have a broadband conversation. We'll do that one of these weeks. Holy shit, dude. What's that?

A broadband? conversation. Oh my God. They look like they're going to zero. And then the other thing, all right, so I have two charts of some holdings in here. Here's Cummins, CMI. Okay? So we're not talking about sleepy stocks. This thing is, I want to say it was $150. It was $200 a share. A couple of years ago, it's almost 700. And the other one,

Southern Copper. Obviously, like, this is a rock and roll style. It doesn't only go up. Of course, it goes up and down. But like, nobody misses. Here's a name that's gone from 60 to almost 200. The reason I bring those two up is I think they're very,

they're emblematic of this moment. They're halo because they have heavy assets and very low obsolescence risk. No one's going to disrupt the copper mine, like for obvious, like for obvious reasons. And, you know, Cummins is making engines. You can't just decide I'm going to chat GPT. me, T myself, an engine. So these are like quintessential halo stocks, and they're in the index. But they also benefit from the AI story.

So while we're betting on stocks that we think aren't disruptable by AI, we also sort of, in some of the names, get the tailwind of all the AI activity. I think 36% of the portfolio is industrials. Oh, wow. And you better believe a lot of the industrials in that index are AI benefits. So I just thought it was interesting the way they constructed the index. Anyway, that's my spiel on Halo. I know we talked a lot on the show about me suing people.

We're going to do the next best thing. I'm going to help Roundhill out with their product. And I'm pretty excited that I have birthed this into the world. And in many ways, you're a midwife to this product. Whoa, whoa. You have helped to shepherd its birth. So that's the story. Love it.

All right. Let's, uh, wait, you have a different make the case, don't you? Yeah, we're not going to do that tonight. We're out of time. All right, good. Let's do a misrecha short real quick. Let's knock it out. All right.

Oh. Okay. So the purple line is the S&P 500. All right. This is the last five years. The orange line, and don't guess yet, the orange line is a country. Okay. Next shot.

This is an equal weight version. This is an equal weight sector version. You're definitely not going to get this. You're probably not going to get the other one. Wait, stop, stop. Equal weight sector version? What does that mean? It's an equal weight sector of that country.

So chart, first chart. All right. This is a country that has beaten the, yeah, you can say beat in the pants. So the orange becomes purple in the next chart? The orange is a country ETF. Let's start. All right. What am I guessing that?

The second chart or the first chart. Let's start this one. All right. And it's a country. Is this a G7? I don't know what that means. I'm going to say, I'm going to say Korea. No, that wouldn't have been more vertical.

This is a neighbor of ours. Ooh, our neighbor to the north? Yeah. Is it Canada? How'd you know? Oh, this is oil. Okay. This is oil and gold.

Okay, I'll better one do you. Next chart. You're not a good guess. So let me just tell you. This is equal weight financials of Canada. What in the world is happening here? Ooh, that's interesting. Like, literally.

Like, it's the, wait, it's equal weight that it owns all the Canadian financials. How bizarre is this? What is the Canadian financial? Like the five big, the cartel banks? Like Royal Bank of Canada. Is there a Nova Scotia up there? I guess they benefit. Well, they benefit from higher oil.

rail and gas prices and activity and probably a little bit of sprinkle a little bit of gold on that. And so that Jason in the chat is saying it's all Brian Belski. That could also be. So for as much as we rightly talk. So by the way, by the way, it's 40% of the index is financials. 40% is financials. Then it's 19% energy, 15% in materials and 10% industrial.

So it's not just energy. Financials are rocking and rolling. Can I say one funny thing? Good. Everyone thinks Belsky is from Canada. He's from Minnesota. He's from Minnesota. He worked at a Canadian bank called BMO for a long time.

He's no longer there. People just, they think he's Canadian. He's going to be back on the show this summer. It drives him up a wall. Well, people think he's crazy. Because he sounds it too. That's a problem. He used to write research on Canadian stocks also.

So he kind of didn't do itself. Anyway, just do the exercise. If you're thinking that the valuations don't make sense, we're ignoring the news, it's a bubble. Look at global stock markets. They're doing really well. It's not just us. That's a really great point.

It's a great place to end. We have, as Michael mentioned, we have an all new edition of the compounded friends coming at the end of the week. So much to talk about. I'm super excited about it. Once again, special thanks to our guest, Rupert, who joined us to talk about. about SpaceX, if you were into his stuff,

make sure to check out Blind Squirrel Macro on Substack. Tomorrow's and all new animal spirits coming out with Michael and Ben. Any next talk? I love. You guys like, Ben doesn't give a shit at all. He doesn't want to hear it. He asked.

All right. And we'll do Ask the Compound this week. So there's a lot happening. I also wanted to mention, we dropped this like two hours ago, also on the channel. We did sort of like a, I don't know, I don't know if you'd call it a trailer or a mini documentary. It's three minutes.

Good stuff. But we had a big launch party for our Porterhouse portfolio strategy. And a lot of the people that you guys have seen on this channel, a lot of the financial rock stars in our orbit came out. And I think it would be a fun watch for you. So go look for that. It's on the compound channel. All right, that's it from us.

Thank you guys so much for tuning in. Thanks for coming live. We'll talk to you soon. Rittholds 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.

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