The Iced Coffee Hour - Stocks Just Hit ANOTHER Record High - WTF Is Happening?! | MeetKevin

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Starting point is 00:00:12 Wayfair, every style, every home. This is going to be the most frustrating rally ever. AI giants, Nvidia, Open AI, and Oracle have built a circular network. Is it easier to build wealth right now for the average person in 2026? Unfortunately, AI doesn't make people. wealthy unless they're like at the top tier of being able to use AI but the people who will make most of the profits will be the shareholders which is scary when folks are saying this is a red flag you don't necessarily see it that way

Starting point is 00:00:42 nobody saw this company what do you think is the biggest risk to the economy right now that no one's talking about all that crap's gonna implode one day it's all going to zero one day they're going to overbuild and it's all gonna crash so if there's any motivation to leave from all of this I would say every single year from now over the next 10 years, it's just going to get harder and harder and harder. So I don't know where it all comes out. I don't know when it's all going to collapse, but it's going to be ugly. And a lot of people are going to get really hurt and leverage DTFs are going to go to zero. Kevin, thank you so much for coming on the ice coffee hour. Glad to be back.

Starting point is 00:01:17 Really appreciate it, man. So I'm curious. The big short investor, Michael Burry said, the stock market is minutes away from a bloody crash. Stocks are hitting a record high up 19% since the March bottom. Jack was curious about this one. What stocks have you made the most money on? Ooh, well, let's answer that. First, Michael Burr is probably right. I actually think that this market is going to see a whole lot more crazy ups and downs because what's gotten really popular lately has been super concentration and leveraged ETFs. So you see it like at the end of the day in the beginning of the day, things just go crazy up and down. And I think we're going to

Starting point is 00:01:58 see that craziness. Like these are going to be the most. volatile years I've been over the next few years because I kind of think a lot of people are like, it can't go higher and watch that, I follow the QQQ, the NASDAQ 100. It's going to go through like a thousand. And people are going to be like, what? This isn't fair.

Starting point is 00:02:13 Why does it keep going up? It shouldn't. But between here and there, Burry's probably going to be right and be like, see, I told you there was a 19% dip. And then it goes right back up. It's crazy right now. So what about the stock?

Starting point is 00:02:24 So on the stock, most money in the last like six months, circle, actually. bought it around 68 and then of course it fell to like 58. I'm really good at like buying when it's still like kind of got some room to go down. Like timing that bottom so hard. But now it's like 120, 1.30. And I'm like, okay, great. That's a really good play.

Starting point is 00:02:44 You know, longer term over the last four or five years, Nvidia has been really great. But, you know, they're also losers as part of that. More recently, like, the hell with Netflix. I shouldn't say bad words on the show in the ice coffee. But I bought Netflix, made money from my buys when they were going through that whole Warner Brothers crap. But recently, they just keep bleeding.

Starting point is 00:03:06 And they're such money makers. Nobody realizes they'll probably exceed the advertising that YouTube's growth has. So YouTube's advertising growth? Yeah. Netflix is going to blow it out of the water. Nobody's even paying attention to it. And what stock over your lifetime have you made the most money on? Oh, by far Tesla.

Starting point is 00:03:23 Yeah. I remember, man. I think it was in 2020 or 2020. Yeah. You showed me, I think it was like a J.P. Morgan account. Yep, yep, yep. I'm just going to say there was $40 million. Oh, yeah. And I remember looking at that and just thinking the only thing I would do, I wanted to click sell for you. I know, I just sell everything, right? I wanted you to sell so badly and just lock it in. And then. The crazy thing is it'd be like, you know, here in California, you pay like 35% in gains taxes. You know, because it's you got even, even the long term, right? Short term, you'd be at 55% gone. Poof, more than half. Yeah, but even then you would. Yeah. But even then you would. would walk away in the 20s. That's true. And I think I told you back then, man, I would just take a year off. Right.

Starting point is 00:04:03 Yeah. Yeah. How much did you put into Tesla? Was that all Tesla gains? Like, what did that $40 million look like? Because I swear, I blinked to my eyes. And all of the sudden, it was just like everyone here. And Kevin was leading the charge by miles.

Starting point is 00:04:16 I wouldn't say it was all Tesla. There was a chunk of it. I would say about $8 million of it was margin. So not all of that $40 was, and I have a video on this somewhere. where I break down, like how much of it is margin or whatever. So the video would be a really good reference to look up, you know, the $40 million portfolio. I want to say my buying, because I bought Tesla, I remember, before COVID in like 2017, I'm like, gosh, I got 500 grand in Tesla.

Starting point is 00:04:41 And then it went down. It was like, 300 grand. You know, and I'm like, ah, and everybody's leaving me comments. Like, you're such a loser because it was during production hell with the Model 3. Same was true, by the way, when I bought Nvidia. in when I launched my ETF back at the end of 22, I bought a ton of Nvidia at the same time. And it just went down another like 20%

Starting point is 00:05:03 and everybody's making fun of me. I want a loser. That was a six or seven figure return on that multi-millions of dollars from Nvidia. Tesla was probably seven million of that 40 in gains. I think the total was like maybe 15. That was in Tesla. Two concentrated.

Starting point is 00:05:18 But that's from memory. But yeah, I mean, hey, there are winners and losers, right? Like I lost money on, really is, I lost money on a firm back in 2021. How much? I think I rode that down probably a million and a half. Yeah. How does it feel looking back and losing a million and a half on that?

Starting point is 00:05:34 That's not the only place. I've lost a million dollars. I mean, because I've lost a million dollars and even just other business ideas or opportunities or like, oh, you know, I'm going to go learn how to be a pilot. That probably costs a million dollars, right? So I don't really look at the number anymore. I look at it more as it was a really expensive. college education. You know, so like, hey, you know, what lessons could I learn from why I didn't sell a firm earlier, right? And how can I not make those stupid mistakes again? How do you say that

Starting point is 00:06:04 so casually, like, oh, I can lose a million years? Honestly, it's probably the happiest I've ever been right now because I really just don't care about the numbers because I got these beautiful seven children, you know, I don't have any debt. There's no worry about anything. It's like I don't I have margin debt, a home debt or whatever. And I realize I'm a really fortunate place because, you know, there's YouTube income, there's other revenue, you know, I run house hack. Now we call it reinvest. So for me, I'm like, I just want to build.

Starting point is 00:06:34 And I don't really have this stress or fear of a downside. Back then I did. You know, I had $8 million in margin debt. I had 20 properties with mortgages on them, right? So it's weird, but like I'm way less stressed today than I was that. Didn't you used to make fun of Dave Ramsey, though? for the debt aspect. And now you're like,

Starting point is 00:06:53 well, you said billionaire or broke. Like confidently. That is still true. I still believe in the billionaire or broke thesis. So I still have that as an ambition. Like, I still want to do that.

Starting point is 00:07:03 And I think I can with, you know, the real estate company, with House Act, reinvest. But yeah, it's maybe like a, what do you call it like a mea culpa

Starting point is 00:07:13 when you're like, damn, the guy always used to make fun of Dave Ramsey. I'm kind of like, uh, maybe he kind of had a point. You know, like respect.

Starting point is 00:07:20 So you feel, So you feel better paying off all the debt. Great. Do you recommend the average person pay off their debt? It depends because the tough thing is, you know, you want to be able to build wealth. And I personally think one of the best ways to build wealth is real estate, which is really annoying for people to hear right now because rates are so high. It's like, nobody's building wealth with 6% interest rates.

Starting point is 00:07:42 That's fair. That'll change over time. We're not going to be at 6% interest rates forever. You know, I think the biggest risk now that people have is there's so. so much of a desire to take out margin debt for betting markets or Robin Hood or whatever, and I think that's where people are going to get destroyed. And I do think that debt, you know, there's the AI side of debt. We could talk about that later. But I think a lot of people are drowning in debt right now. I think a lot of people have a lot of credit card debt,

Starting point is 00:08:09 multiple credit card debts, student loans. I mean, you know, in some areas on the margin, you're seeing car delinquency skyrocket, credit card delinquency skyrocket, a lot of lower income. And it's really hard. But it goes. to show that that debt is something that does kill you and kind of prevents you from building a net worth. So what's causing the stock market rally? Okay. So once we had the ceasefire, what was really interesting was during the Iran war, geopolitics are almost always a buy-the-dip, by the way. And it's always painful to say because everybody sees every war is like, this is going to be the recession. This is it. The nukes are going, which it is possible that Iran

Starting point is 00:08:49 is secretly building a nuclear weapon in Pickax Mountain, but really... One percent. I would give it about an 8% chance that they one day just, like, in one in like 12 realities, they just wake up one morning and go, so bids, we got a nuke. And it's like, open up the strain. Otherwise, we're throwing it. We're lobbing it.

Starting point is 00:09:09 We're just going to lob it. Go ahead. Shoot it out of the sky. Guess what's going to happen? A lot of people get to die. All that radioactive material is just going to go blow over Europe. Yeah. Like one and 12 realities.

Starting point is 00:09:20 You give that an 8% chance. Yeah, yeah, yeah. That's the equivalent of, by the way, someone at a crafts table basically rolling like a tent, which can happen multiple times in a row. Yes, yes, yeah. Well, I mean, looking to Pickax Mountain is what I would tell your viewer, because it's the one that we didn't strike when we did Operation Midnight Hammer with the B2 bombers. And it's the one that we have not struck during this last operation.

Starting point is 00:09:46 Why? Meanwhile, they're still building it. weird. It's too deep. I think it's way too deep. Like, they built it probably twice as deep as the last ones and our bombs can't reach it. And you think America knows about this. Oh, yeah. I think they know that's also where the highly enriched uranium went. Because we saw on satellite imagery trucks, it's not a lot, but the 460 kilograms of highly enriched uranium that Iran has, we saw trucks back up to the various different facilities that were enriching. And, you know, if you read between the lines, they moved it. And they probably moved it to their deepest facilities. How do you know about this?

Starting point is 00:10:17 It's everywhere. You can Google. Yeah. I mean, you have to kind of look for it because it's not the sexiest, like, front page news. So what I do is this sounds really weird, but I still read the newspaper, like the physical newspaper. And it's usually on like B7, you know, in the back of the newspaper. And it's like, Pickax Mountain exposed. And it'll be in the New York Times.

Starting point is 00:10:35 You know, it's interesting. Tim Dillon had a whole rant about this. And he just said, it's not good news. Just details like this. It doesn't make for good news. They want the clickbait headlines of this and this. Oh, like pickax. Yeah, of course.

Starting point is 00:10:48 Oh, of course. Oh, yeah. And that's the struggle, especially now with, like, I mean, it's one of the reasons I turn my phone on, like, gray scale is I can't go on X without getting distracted by like, oh, damn, look at that police shootout. You know, it's like, dude, I can't work anymore with what I see on X. Or I open up Instagram and it's boobs or I open up, you know, TikTok and it's aviation or worse, it's female fighter pilots. You know, it's based on your viewing preferences, right? Nope. Because I definitely don't get boots.

Starting point is 00:11:18 I get reef aquariums and Rolex watches on my Instagram. And dudes. Wow. Just body billers, man. Just abs. So getting back to the rally here, is it justified in what's causing it? Yeah, partially. So during the geopolitical crisis, you had valuations tank, especially at companies like

Starting point is 00:11:38 Nvidia and AMD. So I like to look at companies on what I call a forward growth. growth basis. So without getting too granular, basically, what's its valuation? How much money is it earning? And then I divide that by its future growth rate. How much do we actually think they're going to grow earnings by? I think that's really important because you're going to see companies where you'll have like a palantier. People are like, oh, that's a hundred forward P ratio. That's too high. Okay. But they're growing earnings at 40% a year. So you're trading for like two and a half peg or whatever. And for software companies, that's usually actually totally fair.

Starting point is 00:12:14 AMD and Invadia, which are even better than software companies, they just design chips. They don't make the chips. They just design them. Their margins are through the roof. Invidia claims AMD in margins. But anyway, so we had a thesis that hardware would boom because earning season was coming up and the valuations were low. And there's no sign AI is rolling over yet.

Starting point is 00:12:35 One day, Michael Burry will be right. You know, we all know these depreciation schedules are crazy or the circular investments. Like, you saw the cerebrus IPO. Like, basically, quick example, somebody's trying to reinvent the mousetrap, make a different server chip. They go IPO. But the only way they could IPO is if they show U.S. revenues. So how do they show U.S. revenues? They call up one of their big investors, who happens to be the president of the board at OpenAI.

Starting point is 00:13:05 So OpenAI gives them a $20 billion contract. Oh, yeah, we'll use your chips. And now that guy probably is the one who set it up. now they can IPO the company. Company goes in IPOs, that guy gets rich. He basically set up the deal, right? This is oversimplifying the circular flow. That's like a 30-minute video on its own, right?

Starting point is 00:13:25 oversimplifying. But the point of it is there's no sign that that's stopping yet. So low valuations combined with a lot of people sold a lot of stock during the Iran crisis. I mean, Ross Gerber came on, and I love Ross. But when he's like, oh, yeah, Kevin, we're telling everybody raise cash right now. I'm like, dude, if everybody's raising cash right now, everybody's just going to plow into the market when it's green again. And so that's why we've seen this crazy rocket up. So it sounds like you have to be a contrarian investor to a certain degree, which makes me think, too, if everyone is saying

Starting point is 00:13:59 sell. The market's overvalued to see some of the highest PE ratios in history. Schwamp said the stock market is expensive by every single metric possible. And if everyone is shouting, were overvalued. It makes me think the contrarian of that is buy more. Yeah, ironically, I agree with you. I actually think this, I call it, this is going to be the most frustrating rally ever where people will look at 2026 and be like, how did this turn into another 2021? Where the gap between the bears and the bulls went astronomical. And some people just lost everything because they were bearish on it. And other people just made mega fortunes because nobody saw this company. So how should this apply then to the average person?

Starting point is 00:14:47 Because you have a lot of people out there that are saying, oh, you should just buy like mutual funds, very safe investments, T bills, you know, like a standard diverse portfolio. And then you have other people like Chris Camillo that say, hey, you should allocate a sizable chunk, a meaningful amount towards risk capital, maybe like some IPOing companies, some smaller cap companies, higher risk companies. What do you think the average person should be doing? Let's just say you take like the majority of people, they're earning between, let's say, like, 40K and 200K as a family. I know that's a huge spread. But, like, how should they approach today's market?

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Starting point is 00:16:27 podcast. The majority of people, they're earning between, let's say, like, 40K and 200K as a family. I know that's a huge spread. But like, how should they approach today's market? If you're in that range, that $20 to $200, probably the best investment you could really make is trying to figure out how can you and your spouse increase your own income. There are people that I know that went from being a nurse and with overtime they're making $120,000 a year to saying, you know what, I'm going to go back to night school and I'm going to study to be an anesthesiologist. Two, three years later, I do have to take on some debt, but two or three years later, they're like an anesthesiologist nurse instead of a normal nurse. And now all of a sudden they're making $400,000 a year. They're an independent contractor instead of a W-2 person. Now they get write-offs.

Starting point is 00:17:14 They could write off all their side expenses. They could write off whatever. Their education, you name it. And so what's fascinating to me is there's so many opportunities to grow your skill set and make more money that that's where I would focus first for most people. Then I would focus on owning my own home. And then I would focus on summer routines live or die by how easy they are. And honestly, if something takes too much effort, I'm out.

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Starting point is 00:18:06 That's Code Podcast at Jroons.com. That's code podcast at g-un-s-o. Yeah, adding some risk assets in. The diversified portfolio, I think, gets really interesting when you're retired. You know, when you're on that other side of the hump. Okay, that's so interesting you say that because what I've done is I have like maybe 10% of my portfolio in SPY. Everything else, virtually everything else is like QQQ. Nice.

Starting point is 00:18:32 Or VUG, which is just like a large cap. It's like top 100 stocks. A lot of people tell me that that's like ultra risky. But then you also have this other side of social media that are saying there was this chart that I saw. And it was if you bought $100,000 worth of TQQQQ, how long it would take for you to be a millionaire at a bunch of different years. So like the year 2000 all the way up until the year like 2020.

Starting point is 00:18:53 And it was not long every year. Like maybe the longest was like 10 years. But even then like people were, the returns of TQQQQQ are ridiculous. Yeah. What do you think about also the alternative side of like? like having ultra-risky ETFs, like triple leveraged QQQ, which is like very bad.

Starting point is 00:19:13 Jack is a problem with hindsight bias. Well, he likes to say, oh, if I bought NVIDIA 20 years ago. I'm just saying my QQQ portfolio has done pretty well. Could it just as easily have not us. 20% cash position. I mean, in fairness, over the last 26 years, we've really had a technological boom, right?

Starting point is 00:19:30 I mean, look at where we were with technology 20 years ago. I think Counterstrike came out like 24 years ago. These were like your first video games, right? And we were running on, you know, eight megabit internet. If you were at a T1 connection,

Starting point is 00:19:46 you were lucky and you moved from DSL to cable. That was lucky too. But anyway, so yeah, I mean, there is some hindsight bias there. But I actually think the spy and the cues that you said, great. I wouldn't touch triple leverage because I think as soon as we get our credit event,

Starting point is 00:20:02 which will happen one day, some black swan, whether it's private credit or all this crazy off-balance sheet financing that's happening with like meta and the big, you know, the blue owls and the mega caps to finance their data centers. All that crap's going to implode one day. It's all going to zero one day. They're going to overbill and it's all going to crash. And when that happens, TQQQ is really going to suck. In fact, it'll probably go to zero, which you can't come back from zero.

Starting point is 00:20:30 That's actually why the SEC just banned 5x leverage funds. God. They had 5X. Why did I not know about this? Oh, man. So they weren't available yet. So they banned it before they became available because it was getting so ridiculous. And if you look at just either the tariff shock or this Iran shock, you would be zero.

Starting point is 00:20:50 5X would already be at zero. They would have all already collapsed. So the SEC, you know, did a good thing there. They stopped that because they would have already been at zero. 3X leverage the next recession because we are so, like we've never been through a real recession. Well, I don't even know that during COVID we had triple leveraged DTFs. We should look into that. But let's say we did. Absent COVID, because it was such a short recession, absent COVID, we didn't have triple leveraged ETFs in the great financial crisis. Back then,

Starting point is 00:21:18 they would all go to zero. So you would always argue, hey, don't touch the triple leverage ETFs. But you do think QQQQ is fine. Totally. Oh, I think QQQU is great. Love it. If you're going to buy it long term, get QQQM. It's a little trick. So slightly different, but their fees are like, I want to say half or look into the fees. The reason is they advertise QQQQ. So everybody who comes in from the advertising funnel buys QQQQ because that's where they spread the name. Everybody who knows like the financial advisors that they're trying to, you know, also have used their product. They have QQM for them.

Starting point is 00:21:53 I have no idea. So what do you think is the biggest risk to the economy right now that no one's talking about? It's that credit, credit, credit, credit. That's it. So explain this like I'm five. Because Jack is five. Basically. Explain it like to Jack.

Starting point is 00:22:08 A lot of debt that, so people owing other people money. And we don't know if those people are going to be around in the next five or ten years, whether those are data centers, people who are building out, you know, H-100 Nvidia facilities or data centers. or they are construction companies that are building these and rapidly expanding their debts so they can hire people to build out, whether they're, you know, generator selling companies, you know, whether it's, I mean, not Generac, but there are plenty of other even private companies that are trying to build out data centers and everybody's trying to expand quickly. So people are taking on debt to facilitate data center construction somewhere that's all going to go to crap one day when that cycle turned. So how are you so sure of that? I'm not. That's the toughest part is I don't know where the credit cycle will be. I think it'll be in data centers, but it could be in somewhere else. Somewhere. So what you're assuming probably will happen because these, we don't just, we will always need data centers. But there will be a few winners, a lot of losers, and these losers are going to be caught up in the credit cycle? Well, it's typically what happens when you have an industrial boom as we overbuild. So there were like a quick comparison. If you go back to like the dot-com bubble, We always think of like the consumer.com bubble, like pets.com or whatever. But before that, you had the infrastructure buildout boom, dark fiber, basically. You know, let's live fiber everywhere we can.

Starting point is 00:23:39 I think there was a company called WorldCom and Cross Country, I don't know, whatever, massive debt expenditures driven by spending from the big mega cap incumbents of the day, which is exactly what's happening today, except just for scope comparison. back then, the total, like, the highest annual CAPEX spend was $82 billion from all of the mega-cap incumbents back then. Today, In vidia almost makes $80 billion in a quarter. In about 100 days, Nvidia makes about $80 billion. The top five data center plays, so like Google, meta, Oracle, Microsoft and Amazon,

Starting point is 00:24:19 are projected to spend over a trillion dollars in CAPX next year. which is more than 10 times what we saw in the dot-com bubble. And I think a lot of that is financed by debt. There's a reason why companies who are doing great, you know, Google's great. There's a reason why, though, Google and meta have stopped doing stock buybacks. If you go look at their earnings, they're like, oh, last year you guys were buying back all your stock. They do that because they issue a lot of stock comp to their people. And the people who work there are like, well, I want to buy a house or a boat.

Starting point is 00:24:47 I'm going to sell some stock. So the company buys back the stock so it doesn't impact the stock price and the CEOs get yelled at or fired because the stock goes. down. So they buy back stock. They've stopped doing that because they're out of money, which is crazy. If you look at Microsoft's balance sheet, it's like, what did you guys do with all your money? It's all gone. It's crazy. The balance sheets have gone from amazing to bad. And meta is now hiding debt from their balance sheet. They're literally able to structure somehow legally $27 billion lease commitments that don't show up on their balance sheets. That was a blue owl deal that they just did last year. Doesn't show up on their balance sheet. So a new investor who goes in says, oh, you know, I'm going to

Starting point is 00:25:28 be a diligent investor. I'm going to look at the balance sheet. $27 billion wouldn't even show up. So you wouldn't even know, which is scary. So I don't know where it all comes out. I don't know when it's all going to collapse, but it's going to be an overbuild. It's all going to collapse. It's going to be ugly. And a lot of people are going to get really hurt and leveraged ETFs are going to go to zero. I was reading, though, that a lot of those aren't really going to impact the broader market, that if you're in the S&P, 500, you're going to have very little to worry about outside of a few deals that seem to be isolated. That's the hope.

Starting point is 00:26:00 The biggest thing that concerns me about the economy outside of credit is the labor market. The labor market drives everything. There's a reason why retail sales are still booming right now, which is crazy that they are, but they just keep beating estimates.

Starting point is 00:26:14 Even with oil prices, what, 50%? Well, actually, we're almost double the oil prices per barrel that we had in January, which is also crazy. But despite that, people are still spending more than economists have been expecting. and that's even excluding but that's oil and gas

Starting point is 00:26:29 all driven by the top 1% predominantly yeah okay like 80% of that spending is like the 1% because the stock market is so high

Starting point is 00:26:39 and it's an annoyance to go and fill up your gas tank and pay $7 but you don't care this is true there is a massive massive wealth effect people are feeling rich because the stock market

Starting point is 00:26:51 is at all time highs and so that I'll actually bring me to my point and you're right yeah the top you know, one percent has a big spending, top 10 percent is a big spending. Top half spends almost all of it, right? The bottom half doesn't matter so much for spending, which is sad. But the point is, that's what drives the economy. The consumer is still 72 percent of the economy. You know, that'll start flipping because of AI. But what's really interesting is when people lose

Starting point is 00:27:16 their jobs, then they stop spending. And so that's what makes me the most scared is that once we see that slowdown, we don't know when it's going to be, but once we get that construction build out slow, all these great jobs reports we're getting, they're not going to have that support anymore from construction or from, you know, software developers getting hired. Ironically, even in the age of AI, we're seeing more software developers get hired now. Here's my prediction. The stock market's going to keep going higher and higher and higher and higher and higher. And people are going to keep saying it's a bubble, it's a bubble, it's a bubble. And then there's going to be a point where they're going to say, I was wrong. It's not a bubble. And they're going to buy. And that's when you sell. And it's

Starting point is 00:27:55 that's the moment you gotta click sell is where all the doubters say, I can't keep doing this any longer. I'm back in. But they'll never do that. They will. Michael Berry will, I just don't think that that's. I think there will get to a point where the majority of people out there

Starting point is 00:28:10 who have been sitting on cash say, I've lost so much an opportunity cost. I've been wrong. I'm going to buy it. So what do you think then for the average person? Because this is one of Graham's favorite things is having what we call dry powder. Yowie. So having a good amount of cash,

Starting point is 00:28:25 You said your portfolio is, what, 15% cash? 20% cash. 20% cash. Well, it's not cash. Treasuries. Yeah. Cash. So he has 20% cash, treasuries.

Starting point is 00:28:34 A stabilized asset. Cash equivalence. Cash equivalent. Do you think that this is a reasonable approach for most people? Like what percentage cash or dry powder treasuries, cash equivalence, should they have set on the side to purchase in the case something happens? Like we have another like geopolitical. Yeah. Crash. I think that's great. I actually, I'm a big fan. I, you know, I think a lot of people could benefit from that because what it means is, first of all, if you have cash on the sidelines, you probably don't have a lot of margin. It depends on what kind of structuring or deals you're getting, but margin rates for most people are very high right now. And so if you have cash on the side, there's a good chance you're not borrowing against your stock, in which case you don't have pressure to sell. And if the market goes down, the market goes down, it doesn't matter. You have that opportunity to buy. And psychologically, when people are buying, when the market's going down, it kills that feeling of fear of, oh, crap, it's going down, I'm losing all this money.

Starting point is 00:29:35 You're buying, if you're buying, you're psychologically seeing it as an opportunity, which is great because you're increasing your ownership. Like, I always see it as ownership with any stock. If you like a, if you have a favorite company or you want Nvidia, the stock price is at 150 during the geopolitical crisis. Great. I was able to buy more ownership of that company at a lower price. It's great. DCAN. So then how is your net worth divided up?

Starting point is 00:29:58 What does your portfolio look like in the middle of 2026? Well, there's a good amount of treasures, cash equivalents. Love that. I'm a really big fan of that right now. What percentage cash equivalent? A lot of my net worth is in house hack and reinvest. And I don't really know what the daily value of that is because it's a private company. There's one value based on what we recently raised at.

Starting point is 00:30:20 Then there's a value based on what we're about to raise that, probably in like September. you know, and then there are also stock options. So there, that's a big skew. But let me put it in comparison to history. In comparison to history, I've got probably four times as much cash than I've ever had before now. And I feel great about it. No debt, too, which feels great. So I think that's probably the easiest comparison. There was a viral clip from our podcast that occurred recently of Kevin O'Leary saying you're not truly wealthy until you have $5 million of cash liquid available to you at any given moment. What do you think about that? I think that's great because

Starting point is 00:30:58 now you're sitting around with true like just FU money basically. It doesn't really matter if you know, oh, the car needs a $10,000 repair or the house needs a new roof or whatever. If you've got five in cash sitting around, those are all just rounding errors, right? That's a wonderful place to live in, but that's not for

Starting point is 00:31:16 everybody, right? Kevin O'Leary's talking about the top 1%, or maybe even a fraction within the top 1%. So it's not relatable. And so honestly, I haven't seen the clip, but he probably gets a lot of flack for that. But that's kind of what keeps Kevin O'Leary really relevant because he says these things that people go crazy over. He's really good at clips. I think that's why like Fox loves having him the clip man.

Starting point is 00:31:41 A lot of people actually agreed with him. Like if you went into the responses, a lot of like wealthy people are like, I actually 100% agree with this. I was blown away by. I thought he was going to get a lot of hate for sale. I honestly thought I was going to get hate too, but I also agreed with him. So that's interesting. It's funny you're talking about treasuries here because I just saw it for the first time since 2007. U.S. Treasuries are selling at 5%.

Starting point is 00:32:01 And Jack says, is this a good investment? No. I have to say, to me, it seems kind of appealing to be able to lock in 30 years at a 5% return. Guaranteed risk rate. I mean, obviously, there's some interest rate risk in between there. But I think locked in 5%. And we're talking right now about the risk reward of the S&P 500. And people basically say that the risk premium that you pay for the S&P 500 is now negative.

Starting point is 00:32:30 Yes. When you account for what you could get guaranteed in a treasury. It's true. So, I mean, let's break it down. The reason people say that is the S&P 500 trades for like 21 times forward earnings. So if you just divide that into 100, you get like 4.8% a year. That's what you're expecting. You're expecting 4.8% per year from the S&P 500.

Starting point is 00:32:49 Yes. Okay, this is always what people end up doing. And then the S&P 500s ends up doing 13% years, you know, or dividends reinvested even more. I think historically it's like over 9%, but lately it's been more. The problem with the Treasury play, and that's why I was so quick to say no, is I understand the appeal of locking in that 5%. But the problem is duration. So if for whatever reason, interest rates go up a percent, you know, because inflation, you know, because inflation. last even longer, that 1% is going to kill like 22% of your portfolio instantly. That's what you'll see. Now, if you want to hold those bonds for 30 years, you'll get 100% back.

Starting point is 00:33:36 But in the meantime, one year later, interest rates are 1% higher, you're going to be 20% lower. You put a million bucks in. You're going to be looking going, hmm, I only have $800,000. Now, you're still getting a 5% yield on a million, right? you're still getting that $50,000. But usually that then shake people out and be like, oh, just tax loss harvest over here. So people just don't hold them until the end.

Starting point is 00:33:57 If you really truly hold it to the end, fine. It's great for retired people. For you, at what price would you invest in a 30-year treasury? I don't think I ever would. I really like the Warren Buffett mentality of six to 12-month treasuries. And the reason for that is if there's some kind of crazy weird shock, whether we have stagflation or rates go to zero, I want liquidity. But there's got to be an interest rate where you say, hey, you know what, I'm going to

Starting point is 00:34:25 go 50% in this. Because I got to say, if right now I had the option to lock in a 12% return, I would probably just lock in a 12% return. If I knew guaranteed for 30 years, I just average that, I would probably do it. It all depends on what inflation is too, right? Because if inflation were 13%, you'd be like, hell no. Right? I'm not going to do that. Just given right now. Just given what we know right now at what price. So I think that all comes down to people's individual opportunities too. Like if you're running a, if you're a real estate agent and you're making $100,000 a year, I'm thinking myself, all right, what can we do to get your business to $300,000 a year? That boost of income is going to be so much larger on a percentage basis than worrying about that treasury bill, right? Like what can we invest in? Let's get you some better open house signs or a nicer suit or what?

Starting point is 00:35:15 whatever. It's not that expensive of business to run. So it depends on everyone individually. Me personally with what we're doing with house tech reinvest, I wouldn't want to lock in 12 percent because I think we will make more than that on an annual basis. But that comes down to everyone. That's also going to take a lot of work. So, you know, if I think we can make 25% compounded per year, I have to work my ass off to earn that, right? And if I'm retired or I'm not running a startup, up, yeah, dude, 12% might look pretty appealing. So I don't blame you. Are you worried about the hentai virus? It's funny you ask me that because I joke that it's the... Dude, I always call it the hentai virus. I love it. Yeah. I joke that it's the virus that's the

Starting point is 00:36:02 final boss of house hack. Because it's spread by rats and dude, we buy a lot of properties that are like infested with like hoarders and rats and cat urine. And people are getting sick from this just by like sweeping garages and like aerosolizing or whatever it's called or whatever. The urine and the feces or whatever. And that's how they're getting sick. And people are dying from it like a lot. Like 300 people have died.

Starting point is 00:36:28 I think it's like a 38% death rate. It's bad. On your properties? No, nobody's died on my property. I'm kidding. No. People are dying from it. No, it's so weird because it's like it's, it's, it's, it's,

Starting point is 00:36:40 Literally, I'm reading about this virus and I'm studying it. And I'm like, cat urine, rat urine, doesn't spread human to humans. So it's like you have a really low population risk. But then if you get it, it's like bad. You have like a one and three chance of dying. But I'm like, man, this is like a hoarder's virus. If you're a hoarder, you probably have rats in your house. You probably have henta virus in your house.

Starting point is 00:37:00 So now I have to underwrite my deals a little more sharply. But I'm not really broadly worried about it. Why aren't you worried about? Why are some people saying that this is like the hidden catalyst for a risk? session in the economy that we're no one's paying a lot of attention to it now i did look back at a tweet from the world health organization in january of 2020 that said the same thing about covid the transmission rates are really low it's nothing to worry about and a month later oh yeah well we were wrong and yeah it's really interesting i mean covid was crazy because you just wonder like

Starting point is 00:37:32 what money interests were at play especially with like wuhan and the development of like oh yeah let's direct evolution between these monkeys. It's crazy. That virus should have never existed. But that COVID spread person to person through us just sitting here, you know, breathing and talking. I can't spread henta virus to you if I have it right now. Maybe I do. You know, I have to like, urinate. You have to go touch it, you know? Or like, we have to, we have to hug. Uh-oh. So, so fortunately, I think just because of, and I'm not a doctor, but because of the, mechanisms of it for as a stock analyst guy and a real estate guy, I'm not worried about it for the market. I probably am not going to be sweeping any rodent homes anytime soon.

Starting point is 00:38:24 So do you think then, given all of this, there's nothing to worry about so far with that in our economy, that is it easier to build wealth right now for the average person in 2026? This episode is in partnership with Airbnb. Graham and I are always traveling for the podcast, We were just in Nashville filming a few episodes there, and let me tell you, the food was incredible. I had the absolute best appetizers I've ever had. There was this dough ball and these steak-skin potatoes. It was incredible. But let me ask you this.

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Starting point is 00:39:42 If you're trying to make some extra cash on this side, I couldn't recommend Airbnb more. If you're ready to host but need a little bit of help, find a co-host at Airbnb.com slash host. Now, I've got to say, we recently replaced our entire invoicing system with AI, and what used to take five hours now takes about a minute. So it's no secret that AI is a must at this point. But here's the thing that most people miss. Knowing that AI is useful and actually putting it to work, are two completely different things.

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Starting point is 00:41:04 I think, unfortunately, AI doesn't make people wealthy unless they're at the top tier of being able to use AI. I don't think most people use AI to the best of their abilities. A lot of people still doubt AI. I think only 18% of companies, according to Goldman Sachs right now, are actually implementing AI inside their companies, which is insane. That's such a low level. But what'll longer term happen, I believe, is corporations will take almost all of the profit from AI. corporations, whether it's logistics, shipping packages, customer service, you know, your T-Mobile, your grocery store, whatever, stocking inventory, making products, everything, can almost all be automated with software over time and artificial intelligence. And guess who cuts out? Gets cut out. People. A lot. And I'm not saying there won't be other jobs or other opportunities, but the people who will make most of the profits will be the shareholders because you're going to see companies like you, even Cisco, where, I mean, they just reported banger earnings. Their stock has gone like straight

Starting point is 00:42:09 vertical. And they're literally reporting what I expect is going to continue happening. Wow, we're beating earnings and we're firing more people. And it's a terrible transition because to me it says it's harder for people to build wealth. It's kind of hard to build wealth if you can't qualify for a loan or you got fired and now you got to take a different job and you got to go back to school or, you know, go learn a new skill. That's hard. That takes years. So I think there's like, there's unfortunately this sort of like a lull that we're in right now where if people are kind of screwed and it's the corporations that are winning and that's going to lead to a rise of more AOCs and more Mondonies in New York.

Starting point is 00:42:49 So if you were to give advice then for the average person out there, not what you would do, but you think would be the most productive at scale for someone to implement in their life to become wealthy in today's environment, what would it be? And then also what would you specifically do? because I'm sure what you would do would be different than the wide appeal advice that you would give. Let's say I was starting over or somebody else is listening

Starting point is 00:43:12 as like, how can I make a lot of money right now? I actually think the people who are going to make the most money are the people who are the best at implementing AI and things that are traditionally kind of boring. Insurance, bookkeeping, accounting, these are places that AI is going to dominate. And I'll tell you, I'll get on the phone with insurance brokers,

Starting point is 00:43:32 and I immediately know the people who are actually productively using AI because these people get emails out fast, they get quotes out fast, they get policies out fast, and they know where the holes are because they're using AI, and I can tell they're using AI,

Starting point is 00:43:46 but they're not using it a way where they're copy and pacing everything. They're still using their brain, and they're like, okay, yeah, yeah, this is what this person needs. All right, let's fit this puzzle. That's where all the money's gonna be. Eight out of ten people, I would argue,

Starting point is 00:43:57 are the opposite. And they're like, no, man, nah, man, AI. You know this one time it, it hallucinated and it told me this. AI stupid. Those are the people are going to go bankrupt

Starting point is 00:44:07 because AI is now chat bots basically are like three and a half years old already. The chat sheet sheet meeting was about a little over three years ago came out in November of 22, three and a half years ago. It's gotten a lot better.

Starting point is 00:44:20 Now I don't think it's going to exponentially keep going we're not going to get artificial general intelligence. This is still token next letter prediction stuff. But basic stuff, a real estate agent,

Starting point is 00:44:31 a lender, getting your loan license for when rates come down in the future, because they will come down again in the future, bookkeeping, whatever. Power that with AI, even an attorney, honestly. An attorney with AI, probably the most dangerous thing that could exist right now. It's so funny you say that because right before this podcast, we were talking about Grant Cardone, we asked him the same question. He said the exact same thing. Shut up. Yeah, he said he did. He said the exact same thing.

Starting point is 00:44:58 It's AI implement. Yeah. Yes. And AI implementation, he said you go to businesses that don't have 24-7 sales centers. And a lot of people will call after hours, but they can't get a hold of anyone. So what do they do? They call another business. Yep, exactly.

Starting point is 00:45:10 If they want a solution, they want it right now. They want their AC fix. You don't answer. They call someone else. Exactly. So if you can get an AI call center that, I mean, realistically, if I call and it's an AI call center as long as it's good, I don't care. Or text.

Starting point is 00:45:22 Exactly. I don't even know if it's an AI. I just want my problem solved. He said you go to 10 businesses, completely revolutionize their business, take $8,000, from each business, you're making a million dollars a year. First year of doing. I actually, I mean, those numbers are very ambitious, but I think that this is like the lowest lift, most scalable thing that people can be doing right now to make a ton of money. Totally. I agree. That's scary. That I like.

Starting point is 00:45:43 Millions of views and people were sh-oh-old. Yeah. Well, a lot of people in the tech world. What they say? Like, we're like, we're, like, we're shing on it. Yeah. What did they say? They said it was unrealistic. You're never going to get 10 businesses. No one's going to pay $8,000. But like, if you're like an 18-year-old kid who knows nothing about AI, how you're going to like, and great Cardone responded and he just said, have fun being poor.

Starting point is 00:46:03 Right. Well, okay. That would be his reply. Well, so the thing about Cardone is he's not really, like, somebody who's 18 doesn't have to make a million. They have to have a goal of making a million. Even if they make 200, they're freaking killing it, right? That's the mentality that Cardone's trying to push with his 10x, which is good.

Starting point is 00:46:23 Like, that's one thing I won't bag on him for. I'm like, damn, if you try to go 10x, well, even if you think, 3X says better than what you were doing before, right? It's like shoot for the moon. And even if you're still around, whatever, we've all heard that crap before. But so he's not wrong with that. But, but yeah, I mean, how much, the more people are reluctant to use AI around you, when you hear your parents or doctors or people around you are reluctant to use AI,

Starting point is 00:46:48 the more you should be doubling down on it. That's my take because that means there's more money to be made. What sort of investing opinions do you have that you think most people would disagree with? I think this is going to be the best decade ever, 2022 to 2032 to buy real estate. Now, everybody hates that idea. Absolutely everybody hates that idea, which is exactly why I think it's the best idea that exists. Mostly because between 2022 and 2032, we're going to likely continue experiencing the highest interest rates that we've seen since, like, you know, the 70s, sagflation era, which is crazy. But it's been caused by shock after shock, whether it's the tariff shock, the Iran shock,

Starting point is 00:47:31 COVID, Russia, Ukraine, whatever. These are all inflationary shocks. Okay, great. So we have rates higher for longer. Even though we are getting Kevin Warsh, as the new Fed chair, he's not going to be able to dump rates. The best thing that he's going to do is be an anchor to prevent them from going higher. That's it. That's the best you're going to get out of Kevin Warsh for a while.

Starting point is 00:47:51 Which means real estate will continue to be unpopular unless you have a lot of cash. So we're fortunate that at House Act reinvest, we don't have any bank debt. So it's $80 million of real estate, maybe $85, if you include some of our dirt, of paid off real estate. And I see that as not sort of a way of saying, oh, you know, a way of all this money or whatever. It's a way of saying this is where we're actually putting money. And the reason we like doing it during this decade is because we believe that by 2032, rates will probably be back at zero. we might actually even look like Europe. It becomes socialist,

Starting point is 00:48:28 and then all of a sudden wages go down for the average person, productivity goes down, and interest rates end up going negative on savings. We'll probably be back to that in the 2030s. And the people who have acquired the most real estate between 2022 and 2032 will have the biggest piggy bank and say, I now get to refinance all of this at you thought 2.7% was great. Try 1.7%.

Starting point is 00:48:52 or whatever. So I think it's interesting that 75% of the U.S. right now, in terms of homes that are currently for sale, are unaffordable to the typical household. Ninety-seven percent of the U.S. counties are now considered unaffordable by historic standards. Most Americans say now is a bad time to buy. There are 64 percent more sellers than buyers, and negative equity is increasing for buyers who purchased in the last few years across the country. I would argue that real estate is fundamentally too expensive at today's interest rates, that prices have barely budged because there's such a lag effect. And I'm taking the opposite approach of you, and I'm selling my real estate.

Starting point is 00:49:34 In fact, I just listed one of them for sale today, hours before this podcast, and I can't wait to be done with it. I'll buy it with shares of house hack, and you'll get a call option on the future. Real estate software and cash real estate baby. I want cash right now to be able to buy this. installment things. 5% treasuries. We'll installments sell you so you don't have to pay taxes or 1031. I want I want 5% treasuries.

Starting point is 00:49:59 If you could just give me a 5% treasury. Our last round was a 5% round. I don't want house hack equity. I want to be able to, I want the cash. I want cash to be able to buy triple leverage to QQQQ. I just think your thesis counts a whole bunch of what ifs. Now, I do think real estate is stable. Yeah.

Starting point is 00:50:20 But I look at the yield. that you get on real estate. And when I say you, I don't mean you specific. I just mean in general. I see the yield on real estate and what you're getting. And I think there's no way that's worth it at today's levels. And I see in a lot of properties, I say, okay, if I get this at a 30 to sometimes 40% discount, I could make that work. Yeah.

Starting point is 00:50:41 And that makes sense to purchase. But unless they're willing to come down to a certain level where I feel that compensates for the higher interest rate environment that we're in, it doesn't make sense. And if you buy it today, what I believe to be a premium, you're basically banking on all these things happening in the future to bail you out, so to speak. I totally understand where you're coming from. And I agree with you. With all your statistics, I think are 100% right. I think there are a lot of portions of the country that have been overbuilt.

Starting point is 00:51:10 And those are areas that are seeing a lot of negative equity. Austin, Texas was a great example of that. Parts of Florida were an example of that. I also agree with you that if you're going in financing a property, it's very challenging to make it make sense right now. You'd probably have to put 35% down. And a lot of people don't have that cash. You know, 35% down, we're filming this is, you know, $350,000 just to buy a home out here, which is crazy. So for most people, it doesn't make sense. And you're right. It doesn't make sense to finance. There's certain areas of the country that valuations have gone down. On top of that, your returns right now are probably in line with kind of like a commodity. It's almost like gold. I mean, gold has done really well over the last year, but traditionally, longer run average, it's sort of like you're trying to protect yourself from inflation. So you're really not getting anywhere, which is exactly why I want to be shopping, because nobody else is wanting to buy really real estate right now. So here's what I'm saying, though, you say cash. I would be the equivalent of a cash buyer. And what I see, even if I were to buy a property is to look at the opportunity cost. of something like a treasury. And so even though I'm not paying the 6% mortgage rate,

Starting point is 00:52:23 I am paying a 3.5% to 5% tax-free yield on a muny bond. And that's how I view it. Because right now I could get risk-free 3.6% in one of the Schwab tax-free muni bond funds, and it'll deviate plus or minus like 5% in perpetuity, basically. Until the cities go bankrupt.

Starting point is 00:52:45 If the United States goes bankrupt, If the United States goes bankrupt, then there's funds. That's different. Yeah, but not when they're buying a basket of funds spread across hundreds of funds. If the United States goes bankrupt, then I am screwed. I agree. But I think we all are at that point. Yes, correct.

Starting point is 00:53:02 No, I agree with you. I think treasuries are great. But here's my point is that I look at that and then I say, well, I could rent basically the same house for 30 to 40% to less than it would cost to own. Of course, you're right. And then I look at that delta, that premium that I pay. And I said, well, what else could I do with that? I could invest. I could burn the money.

Starting point is 00:53:21 You could throw it. You could join him. He burns the money, you know? You guys can have a little money burning party, you know? That, you guys have the rich person left now. That's crazy. You guys both have always wanted that laugh. We just need to go out of laugh now.

Starting point is 00:53:38 All right. At what net worth does the rich person laugh start? I'm really curious. Oh, man. I don't know, man. Is it $5 million? 10 million? It's just a rich person.

Starting point is 00:53:49 I mean, I can never say that. Oh, well, you should have listened to yourself scackling. 10 seconds ago, Graham, you have the rich person laugh.

Starting point is 00:53:57 Did I not have that before? I don't think so. I think it's developed. I'm not even kidding. I think it's developed. I crossed a milestone recently, and I told Jack and a few people, I crossed this milestone,

Starting point is 00:54:07 and then he says I have this laugh. It could be that. Yeah, it could be. It could be that. That's incredible. I mean, you guys have to, Graham did not laugh like that back in the day. Well, congratulations.

Starting point is 00:54:18 Congratulations. Yeah, so something to consider the way we look at it, which is just how we run our business is we look at buying our properties for 20% less than what they're worth because we buy fixed ropers, and that's considering the fix-up cost. So for us, we're getting a discount on the property up front. Of course, you butter that out over years. You know, it boosts your rental return. But yeah, you're right.

Starting point is 00:54:41 Treasury yields are attractive. But to us, it's already a stabilized asset that we can do a lot with. in the long term, primarily refinancing. If and when, which I expect will be by 2032, rates come down. And let's say by then we've built to make MathEasy a $100 million portfolio, which we're already at like 85. So we're going to be at $100 million probably by the end of the year. Then we can turn around and leverage that with 30% down. All of a sudden that becomes a tool for us to get access to maybe another $200 million. And so now we have nearly a third of a billion dollar company based on assets that we can buy.

Starting point is 00:55:23 If I can go buy another $200 million of real estate, especially when rates are low and I get a 20% discount on those, that's another $400 million. Or sorry, $40 million. So for me, I look at owning real estate as a stable inflation hedge. It's very undesirable for people to buy right now. And it's a call option on the future. But it could only be in highly desirable markets. So we buy in high cost of living markets. And most people especially hate that idea.

Starting point is 00:55:52 Well, your risk, the two risks. One is tenant habitability lawsuits, which in California are a dime a dozen. Your other risk is all these initiatives that are going into effect right now that want to ban institutional buyers. Yeah, you're right. And I saw the recent Trump proposal, and I think it was 250 homes or more. And what they're probably going to do is there's. going to go back and forth on that they're going to argue and someone's going to push it up to 500 and it'll only impact a few specific places and I saw even in that fine print because I

Starting point is 00:56:25 look through it because I'm really curious about this that it doesn't apply to build to rent communities which means that all these companies are now just going to buy a plot of land build their own rental community with 501 and they're going to be totally fine but I think it's a it's a it's a risk that if if housing prices remain high it's politically popular to ban investors from buying houses. It is. So there are two things to answer there. One, it's interesting, the habitability issues have been more of a red flag in insurance policies, and insurance is hard to get. It's keeping insurance happy is tough. So we've actually used our software team to make habitability inspection software. So we have to deal with that crap, which we could do with the scale we have. How do you do

Starting point is 00:57:07 that? Because habitability is such an legal. It is, but you have to send people as the owner of the property to verify that these properties are habitable. Okay, let's explain it for people who aren't aware. A habitability lawsuit is basically all a tenant has to say. My unit, I had a leak over there, and it's not habitable. The heating isn't working. This window is broken. I got a rodent.

Starting point is 00:57:34 I can't live here. Anything, any reason. They could come up with a myriad of issues that they could make up. There was even a case recently. It was a mansion. And in one of the mansions, I'm talking about like $100,000 a month. They claimed a habitability lawsuit because there was like water damage in one of the bathrooms. Oh, yeah.

Starting point is 00:57:53 For the whole house. Of course. And then they stop paying rent. And then they get a lawyer who could drag it out for a year. And during that year, you can't sell the property. It's untransferable. You are paying legal fees. And it's basically this legalized extortion where the tenant just says, you give me this amount of money and it all goes away.

Starting point is 00:58:12 Or you let me live here for a year and it's going to cost you a few hundred thousand dollars. And in many cases for the tenant, the legal services are free paid for by the mansion tax or by these taxes that landlords and real estate investors have to pay. So tenants, no risk, landlords, all the risk. Almost all of these settle immediately. This is why you're getting out of L.A. Mansion taxes in L.A. Okay, so, okay, let's talk about that bill because it is interesting and a lot of people are going to care about that. So there's a Senate version and a House version.

Starting point is 00:58:40 the Senate version said if you built a rent or you bought a fixer, you're allowed to exceed the limit, but you had to sell the property after seven years. So there is now forced liquidation after seven years, and you would give the tenant a 30-day option to buy the property first, which I'm actually not really opposed to because your costs are going to be a lot lower if your tenant pays a fair market price for it. You know, you're just saving real estate commissions and whatever. So that's fine. The House fought this with like, I think it was somewhere around 76 members of the house, signed a letter, they're like, this is a horrible idea we can't do. And what they struck was specifically the seven-year sale, which is really interesting because it basically means if you built a rent or you buy a

Starting point is 00:59:27 fixer upper, you can hold a property forever. So it basically changes nothing. But a lot of people always say, well, Kevin, what does this mean for reinvest? Our thesis and what we're doing, is we're taking our real estate software profits from our valuation AI and from, you know, the other things that we sell. And we're reinvesting them into real estate. So really simple. How do you grow an AI company like that? Yeah. To like a billion dollars. Well, hopefully you sell a lot of AI software. So you're very bullish on homeownership and real estate investing. Graham is very bearish on it. Who then should buy and who should rent? Because you agree that it's cheaper to rent. 100%. So what would make it a good decision for someone? I'm a contrarian, right? So I buy Nvidia when it's in the toilet and it paid me seven figures. I buy Tesla when it's in the toilet. It made me seven figures. I like buying when people hate stuff. Like what I like right now? Software. Dude, everybody hates software right now. I think, are people going to vibe code away into it, QuickBooks? No. Are people going to vibe code away body camera AI that you're getting at Axon or, you know, you know, taser manufacturing? No, you're not going to vibe code these companies away and they're making massive software revenues. That's where people can make big money, in my opinion. Great software

Starting point is 01:00:47 companies or even advertising companies, another great sector. Anyway, you know, I like buying when those things are in the toilet and they're all in the toilet right now. They've all gone to crap. But for real estate, then who should buy and who should? People with a lot of cash, which is not very relatable. But again, if you could put 35% down or 50% down, great. So most people should probably rent. Yeah. And then I am curious because you didn't necessarily answer the question of what your portfolio looks like. You said you have four times more cash now than you have in the past. But what about the other portfolio allocation? Like how much of it is in the stock market? You did mention house hack. That's some big ambiguous. No one knows how much it is or whatever. But let's just say

Starting point is 01:01:23 outside of that. Stocks, real estate, et cetera. What's it look like? It is, I would say, the vast majority of short-term treasuries, some stock, and the rest house hack. So that's almost like the pie that I would make. And of the stock. A little bit of real estate, personal real estate. Of the stock, what does that look like? Software.

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Starting point is 01:02:37 restrictions apply, see terms at fandul.com slash predicts slash bonus, hyphen offer, hyphen terms. What's the number one holding you have right now? Well, it's kind of a balanced pie. Circle has done really well. You know, App Lovin is another really good one that's sort of underrated.

Starting point is 01:02:55 It acts on an intuit or some favorites that have. The index was talking about that. Ablovin? Yeah, there was a huge discussion. Everyone loved talking about it, yeah. Wow. Yeah, yep, yep. So those, I mean, they're the things nobody wants right now, which is fine with me. There are some software that I don't love, like, I don't really love Adobe or Service Now.

Starting point is 01:03:14 Like, so, you know, I'm a little choosy. You know, it's so funny, someone on Twitter said that, you know, Photoshop is screwed because no one says that's Photoshop anymore. Everyone just says, that's AI. That's like how Xerox died. Nobody uses that phrase anymore. That's true. I posted a picture of me and a horse and everybody's like, that's AI.

Starting point is 01:03:32 And the irony was, there was not even like a color filter on my photo. There was nothing on my photo at all. No AI. But everybody thinks it's AI. This is like a humble brag. Did you see this photo? I did. Oh, I stopped.

Starting point is 01:03:43 Well, I literally messaged you back. Oh, yeah, yeah. I don't know who was this photo, but one of the other shirtless ones. Something. I think that was one of the, fronting around all shirtless on social media. The few ones that I responded to. As a story, I never swipe up. And, like, I think I swiped up.

Starting point is 01:03:55 I sent like a little thing. Yeah, he zoomed in. He, like, I put this story. Wow, look at this. I think it's one of the people that's fake. But you're right. I mean, like, it's, now you're right. It's not Photoshopped.

Starting point is 01:04:04 It's, that's AI. That's crazy. So you have gotten into incredible shape, and I know we're not like a fitness podcast or anything, but I'm curious. Are you taking redatory tide? I take nothing. Nothing.

Starting point is 01:04:13 So it's literally whole wee nuts, salmon. That's my diet. But you run. You run a lot, right? Yeah. So this is actually where I give a lot of credit to AI, because I don't know much about fitness, but I tell it I want Mediterranean.

Starting point is 01:04:27 any diet. I want pure. And like, I talk to it about everything. And one of the things that I've been learning is you've got to run with your heart rate low if you're also lifting weights. Because if your heart rate's too high, you're burning all your glycogen stores and your muscles or whatever. It's too complicated for me. I just listen to it. And so I've actually been running more slower. I even go on walks with Lauren. So I'll go on like a five mile walk with Lauren. I'll go on a five mile run. But it's like a slow run most of the time. Sometimes like 20 percent of time, I'll run fast and I'll do a four mile. I'm not that fast, but I'll do a four mile in like 31 minutes or whatever, which is an improvement for me. But it's mostly, never in

Starting point is 01:05:08 my life have I done weights. And I started doing weights November 30th. And it's awesome. I'm a big fan. So I wish I started many, many years ago, but I never had the consistency. And now I go every day. So two questions. Which AI do you use casually? Like if you're just having questions that you want to bounce back and forth, because I am constantly using a bunch of different ones. I want to commit to one. Graham uses grok. I love Brock. His favorites Grock.

Starting point is 01:05:33 I still use chat. Interesting. I still use chat. What is like your go-to AI? It depends what it is. So for me, I think the daily driver is probably Gemini. But I find that if I'm reviewing documents like legal text or I need to write an attorney letter, is or whatever, chat is actually really good at letters. Like I don't copy and paste.

Starting point is 01:05:55 I actually tell the things like, you know, I don't want you to rewrite all my stuff. I just want little tips, like change this line or this, that, or whatever, right? But I talk to all of them, and I kind of ingested all into all of them. Then I close all my windows and do new chats with no memory on, and I start the conversations over again. And I get such good insight from these models because they're not biased to what I've anchored them to before. So that's sort of my little AI usage tip. But Dr. Claude, I call it, Gemma for Gemini, and then chat.

Starting point is 01:06:26 And then for the diet. Yeah. I'm curious, have you noticed any other benefits outside of, like, you know, having a good physique? I've regularly had sort of this Mediterranean diet. But the one thing that I found is I have been able to cut my coffee back because I'm increasing my carbs more than ever before because I'm tracking all my calories now. And I'm not getting tired like I used to. I used to have six, seven cups of coffee a day. Now I stopped drinking coffee by 12 people.

Starting point is 01:06:56 PM and I might have usually it's like two or three cups of tea, green tea, which is like barely one cup of coffee, maybe a cup of coffee if I didn't have all my tea. It just depends. But I stop then and that's it. So for me, the carbon intake has been great for boosting my energy. And I was blown away because people are always like, oh, when you work out, you need more protein, more protein. But I look and I'm like averaging 200 grams of protein and all the AI are like, heaven, you're actually getting too much protein. Your body can't use all this. Get more carbs. And it actually works. I'm sleeping back. and more hyped up, so it's pretty cool.

Starting point is 01:07:28 One thing that sparked some interest online, we had George Camel on the pod. George Camel thinks that we need to make $6,000 per month in order to support a family of four. Oh, that's low. So in 2026, how much does someone need to retire with a family of four? $8 to $10 million in assets, whether it's real estate, stocks. I think anything lower than that, if you're, you said 40 years old, you're going to run out. And why 8 to 10? Like, what's the math?

Starting point is 01:07:57 If the traditional financial advice is retire with $4 million, what happens when we have a 50% market downturn? So I'd rather be at 8 and then be at the 4 after the market downturn. It is so funny. I don't disagree. I do not disagree. Exact conversation. Exactly. I'm just going to say it.

Starting point is 01:08:16 Jack said he wouldn't be working or he would work for fun once he has $10 million. And I said, well, when you're at 10, you're going to want. 20 because of 50% market down to 10, so you need a buffer. Yeah. Yeah. You got to have the buffer. I'm like, when you really start looking at it, like the three, because really I see 10 million bucks is $300,000. But the reality is that 99% of people don't have that amount of money and they're

Starting point is 01:08:44 getting along just fine. Well, a lot of people are getting along just fine with less than that. And so like, why would I need to have, you know, sterling silver silver. I don't need it. I don't need to have all of the nice things. People with 10 million don't have sterling silver silverware. Well, at least now they don't. There's the rich laugh.

Starting point is 01:09:05 There it is again. There it is. It depends on your lifestyle, too. Some people are happy playing World of Warcraft and Rust all day long, and they don't need a lot of money. You can play video games. You can crash in a small apartment. And you just, you can survive on way like. less money. You know, my dad doesn't survive on a lot of money. I mean, he fortunately lives rent

Starting point is 01:09:31 free. I bought him a house to live in. But beyond that, he budgets to save up and he's happy. Oh, now I'm going to save this month so I can invest in this or buy this or whatever. And he seems very happy. He's got a dog. He's happy. He's got family nearby, right? He doesn't seem like he needs more. Some people want to retire and they want to travel a bunch. I think what a lot of people underestimate is when they retire, a main source of your sort of busyness goes away and you have to find a way to be entertained. So typically people are like, oh yeah, when I retire, I'm going to spend less. The reality is you're probably going to spend more. So that's why I would encourage people to try to retire with more money. It's true. If you have more time, you're going to be spending

Starting point is 01:10:11 more money. It's like, it's so funny because everyone thinks as you start your own business, you start making a bunch of money, then you're going to be cashing out all the time. But the reality is, if you're working 12 hours a day, you're not going to be spending a bunch of money. You have no time. You're so tired by the end of the workday. You want to go out. Yeah, which is absolutely true.

Starting point is 01:10:29 Just keep reinvesting into the business. Yeah, when you're bored, you tend to spend a lot of money. Like, I find that the days where I'm not busy, like nothing planned on the weekend, I start scrolling heritage auctions. I start seeing what's going on. I throw a few bids.

Starting point is 01:10:43 Yeah. Because you never know what might hit. And then I check carsandbids.com just in case. There's a good deal. And then I check, bring a trailer. And then I browse eBay. I'm just trying to find like deals.

Starting point is 01:10:54 But every now and then I get a deal. Like the other day, I bought these nightmare before Christmas animation sells from the movie, like the originals. Wow. And I was like, oh, man, I need this. Yeah. So I bought them. That's awesome. I had nightmare before Christmas bubbleheads when I was a kid.

Starting point is 01:11:10 Oh, the bubbleheads. Yeah. Jack. What I'm curious about is you said 8 to 10 million to a lot of people that sounds ridiculous. Yeah. You would say that that's. probably that final tier that is worth striving to. And then after that, you see a strong diminish of returns in terms of amount of effort that you put into working and then the money that you get

Starting point is 01:11:31 back. You'd say that's about where the dollar starts to diminish in terms of value. It might even diminish before that. You know, a lot of that 8 to 10 is just hedging for market fluctuations. I'm a big fan of like stay at a margin debt or just debt in general. But again, it comes down to your lifestyle. I mean, when I was flying my own jet around, you know, Eight to ten goes really fast in expenses. So it depends on your lifestyle. And I think eight to ten is a great target. The problem is, you know, a few sentences ago, you mentioned that a lot of people are doing just fine on way less, but I think 70 to 80 percent of Americans are paycheck to paycheck. So I mean, yes, could they be fine? Yeah, we're surviving, but are we thriving? And then the question

Starting point is 01:12:14 is, where do you want to be? Over 50 percent of the people that went to Coachella did it on credit. Oh, yeah. Yeah. Well, the buy now paid later stuff honestly probably helped us avoid a recession. Like the amount of spending that was enabled by BNPL. Did it avoid or just deferred? Probably deferred. Delayed. Right. Yeah, probably. That's going to come do it some point. 100%. That'll be part of sort of that next recession. Whatever causes it. That'll be part of it. Because, I mean, what's crazy to me is there's so much talk about how AI, everybody's spending money on AI. You know, Gemini, just two days ago had to come out with BNP. A firm in Klarna now available so you can pay your stupid $24 a month or whatever to Gemini. But that boosts conversions. I saw like 40% of course. Oh, it definitely boost conversions. No, yeah, it makes sense. But it does make me wonder, is it boosting conversions on that because people wouldn't get it otherwise?

Starting point is 01:13:08 And then is that because they don't have the money? So that's the question. It seems. $25 a month is. I mean, it's like another Netflix. It's another Netflix. subscription, you know. So, I mean, then you get Disney Plus. You know what does all add up? YouTube plus. So what do you think is the ideal amount of money to have? I'm not a big fan of

Starting point is 01:13:28 thinking retirement-wise. I like to think, can you get to a lifestyle where your salary covers all of your expenses and your bills? So let's say you're an entrepreneur and you're able to make $200,000 or $300,000. But your entire family can live on 10 grand a month. So that's $120,000. Whatever extra you make, you should immediately pay yourself $120,000 salary to pay your bills to cover all that net of taxes and then invest the rest. Just pretend you don't have the other growth. Like I'll put myself in these shoes. I would, and the place that I feel like I'm in is whatever money I make from stocks or investments or house hack or whatever, that's all bonus.

Starting point is 01:14:18 Any living expenses that we have for school, insurance, kids, seven children, cars, car insurance, whatever, should be covered by my salary for running reinvest. And it is. So for me,

Starting point is 01:14:32 I'm very happy because I look at it as, okay, I don't need a single dollar more than that. And that's why I started early in the podcast by saying it's hard

Starting point is 01:14:41 not to be happy right now because all bills are covered. There's nothing to worry about. How much do you spend a year as a family of nine? It's hard to say because the numbers fluctuate a lot because all of the children just started going to school in February. So our expenses on home care has plummeted. We had nightcare specialists for like summer who almost died and we had, you know, help 24-7 for the first year of their lives. Those expenses were absorbed insane because we're not just paying for help.

Starting point is 01:15:12 We're paying for specialized help. How much was that? probably north of 800 grand just for a year, you know, in payroll expenses or contract expenses, right? So that's a lot. Now, that said, it's come down massively. And so I honestly think if we spend, you know, just for, you know, travel or giggles or whatever, the family might spend, I don't know, eight on average a month, maybe with food. It probably comes to 10, 120. And then add to that just other living expenses, we probably live on a $250,000 salary. Without a mortgage.

Starting point is 01:15:47 Correct. No mortgage. So we watched a really interesting video. We drove from Vegas to the city you live in, Ventura, Southern California, a beautiful city. And on this five-hour drive, the one video that stuck out to me was this video, Ben Felix, and it's the best way to spend money. And I'm curious, what is the best way to spend money? I would say my favorite, and I've spent money in crazy ways, whether it's in Vegas, on, you know, parties, or again, flying my own plane around, learning how to become a pilot, all the licensing or whatever, business ideas.

Starting point is 01:16:22 By far, of all the money I spent, my absolute favorite money to spend, family vacations. That's it. Disneyland, Disney World, going to Hawaii, going to Europe. that time you spend with family, I think, is everything. I still, I always on my phone or my iPad have a little memory screen on the top. And I always get those feeder scrolls of like, oh, remember that time you were in Rome or remember that time you were in Japan or whatever? Those are priceless.

Starting point is 01:16:50 So big fan of spend money on experiences. You could cut on, you know, the size of your home or the size of your car or all that crap. But experiences with family, spend it all. or the size of your jet. Yeah. Well, that's the joke about jet ownership is as soon as you buy a jet, you think you're cool until the guy with the bigger jet rolls up. I mean, I've parked next to Taylor Swift's jet, Jeff Bezos's jet, and you look like you got a really small peepie.

Starting point is 01:17:20 Did you ever feel broke pulling up in your jet and seeing like the next guy over there? No, actually it was, it actually robs a lot. of the enthusiasm of like be a billionaire because I had the exact same experience as them, which isn't like, look, flying private is great. But I'm using the same bathrooms, the same like FBO where you get your rental car and you get your little snacks or they hand you a little glass of champagne or whatever, unless you're a pilot, then you don't get any, obviously. It's the same thing they do.

Starting point is 01:17:56 The same little golf cart treatment to take you from the side of your plane to your rental car. They drive the car to it. It's the same exact treatment. So it kind of like owning that aircraft for three years sort of burst the bubble for me. And it's like, all right. It's like I don't need to. But you still have the motto, billionaire broke. I do.

Starting point is 01:18:13 I do. Yeah. So it didn't quite burst the bubble. It burst the enthusiasm of what money can buy. I still have that as sort of like an entrepreneurial goal because it means that house hack was a success, reinvest was a success. That number, if I have a billion dollars, the people who invested in house hack early should be very, well off on their investments, right? So that's sort of a dream in a milestone of mine, like trying to create like a mini Berkshire. I know Bill Ackman wants to do that. And I admire that.

Starting point is 01:18:43 I think that's great. I'd love to do that. But it's certainly the private aviation, it's great, it's awesome, but doing it sort of bursts the bubble of how great. So walk us through the purchase of the jet. How much was the jet? What was the payments like? How much did it cost to have a private jet. We bought it for 12.9. We sold it for $69,000 more than that, which was really weird because my tail number was 69 for Pee-P from the very beginning. So it's sort of weird that it's sort of like, oh, you got $69,000 for your prime inflame, right? Weird how that worked out. But fate loves irony, I guess. But on a monthly basis, I mean, I put 25% down on it. I wrote off all of that $12.9 million year one,

Starting point is 01:19:32 which was great because I paid like no taxes that year. The problem is when you go to sell it, you get to pay all that back, which I did. And I was actually really grateful to because when you own a plane, every single month, you hate going to the mailbox.

Starting point is 01:19:48 Because it's like, here's your $70,000 mortgage. Here's your $100,000 Ventura property tax bill you had no idea existed, right? Here's your insurance renewal. Oh, you're going to fly your own aircraft. That'll be $135,000 for insurance for a year. So the bills are insane and you really have to have a lot of FU money to do it. I'm grateful that we had the opportunity, but it got to the point where A, I wasn't flying a lot. And then it becomes a really expensive paperweight. Like, in order to justify it, you probably need to be flying two or three times a week.

Starting point is 01:20:31 And it got to the point where the only flying I was doing was off this coast, being around on top of Santa Barbara, stalling the plane because it was fun. And I called it practice. That's how I knew I'm like, this is stupid. So how much was it costing every year to have a private jet? Probably three mil. $3 million per year? Yeah.

Starting point is 01:20:50 Is that expenses? Not even an equity building. Yeah. Was that stressful? Yeah. You don't keep practicing that because it's going to catch. And it's going to stick. So you spent $10 million on owning a private jet for three years?

Starting point is 01:21:13 Probably somewhere around, probably somewhere on that, yeah. Was it worth it? Yeah. I wouldn't change it. Would you buy a private jet again? I should say no. I should say no. But honestly, I probably will again in the future.

Starting point is 01:21:32 What's the worst waste of money you've ever done? A jet. Outside of a jet, because you said nights in Vegas, you said this, you said that, I'm curious. Yeah, but experiences are so worth it. You know, all of that I'd love. So what's something you did that was not worth it? But one thing is not worth it is like getting to the point where the regulators are starting to like breathe down your neck.

Starting point is 01:21:52 So I was trading a lot of options for a period of time. and then I got these letters they're like, you need to register as a large options trader and we're going to monitor every single one of your trades and the SEC is going to be breathing down your neck and I'm like, hmm, this is not really a game I want to play with.

Starting point is 01:22:10 So, and what's weird about that is soon after that, the SEC is like, oh, by the way, give us all your shit on house hack, we're going to do a colonoscopy on you. And they did for

Starting point is 01:22:25 nine freaking months. And it's not just like, oh, send us this one statement. It's send us everything. Like they go through, they're like, just send us your general ledger, every bank statement, access to your Discord, your courses, your video, everything. Deeds for properties, appraisals, everything. Closed it, no issues. No comment.

Starting point is 01:22:47 When was this? That would be May 2025 through a month. about a month ago. Holy crap. What were they looking for? Well, I mean, think about it. YouTuber raising money on YouTube, flying around in a private jet, telling people that he's not using any house hack money to pay for the jet. Let's see the proof. I give him respect, though, because in fairness, from the day I created this company, I told people, I go, look, anybody who's ever worked for me, I said, YouTuber, plane, raising money on the internet, it's not if, it's when. They will come. And they will look at everything.

Starting point is 01:23:25 And it's fine. It worked out. We were prepared for it. This is why we're PCAOB audited, which like no private company is. But ignoring all that for a moment, your question was what is like basically almost like something you would spend money on that that was a mistake? Anything that would attract bad regulatory attention, even if you're totally innocent, it's still a burden. It's like, it feels like you're going through a lawsuit, right? Because somebody's examining everything you're doing. And I'm sure they still are. Now, in fairness, I feel fortunate because I went through a lot of securities licensing tasks, you know, I kind of know a little bit about the finance world in that sense. So I felt more prepared. But it's a lot. And I just, anything you could do to stay out of the radar worth it. Remember when I ran for governor? I ran for governor. And I commented on somebody's stock portfolio. And then Gavin Newsom sent his California version of the SEC after me. And then they ended up finding me five grand because they said, you raised money making YouTube videos

Starting point is 01:24:25 talking about stocks. You gave personalized financial advice on a YouTube video. We'll settle it for five grand. I cut the check. It wasn't worth it. But my point is, don't attract bad regulator attention. Be a good boy. Do the right thing. What kind of options trading were you doing

Starting point is 01:24:41 in order to get the regulators' attention? Just like massive volumes worth of like zero days. So you were like almost gambling to this. So you were buying call options that expire on the same day that you were buying. Heck, yeah.

Starting point is 01:24:58 The problem is if you spend too much money, the very movement of your own money can move the market. And that's a problem. You don't want to do that. So you were moving the market. I don't know that I was, but. You had an effect that caught their attention. You must have some degree of movement in the market to a small degree. Right.

Starting point is 01:25:20 Right. So I'm like, okay. get out of the radar this isn't worth it. Explain these options though. I'm curious. What stocks were they were you making money on it? Oh yeah, yeah. So I would do things like you know, hey

Starting point is 01:25:33 I think Nvidia is going up. I'm going to buy a one week call expiring next Friday or I think the cues are going to this today and so now what I do instead because again my baby is house hack the focus is on that what I do now is I just do a report

Starting point is 01:25:50 in the morning I go hear my ideas. Like, for example, today was, hey, I think we're going to 718 to 720 on the Q's on triple Q's. And we went from 714 to 71950. Right. Okay, great. Great call. Not every day is perfect. But I think we have a really good track record on that.

Starting point is 01:26:06 But the point is, I used to make all the trades. And I think the concern was were my dollar volumes influencing the actual market. You wouldn't on the Q's. Like on the Q's, you would. Lower cap stuff. There's so much volume on that. Yeah. Yeah.

Starting point is 01:26:23 So are you still doing those trades, though? I don't trade anymore. Yeah, because of that. I just, I don't want the radar. I've had too many colonoscopies. I've had a personal colonoscopy, the SEC colonoscopy. Too much, man. Too much of a radar on me.

Starting point is 01:26:36 What was the largest amount of money you made in options trading? And what was the largest amount of money you lost? Individual trades, probably plus or minus 300 at a time, which is crazy for option swings. In a day. Well, yeah. Like zero day or weeklies? Well, so one example was, this was, it was awesome. I made a bet on Tesla and it was a one week option.

Starting point is 01:26:57 And I said, I'm going to hold this over the weekend. And then there was news over the weekend. I think I fluked into it. But I saw that the volatility was really, really low. So what I, and this is a lesson for anybody who trades options. I like buying options when the volatility is low, the historic volatility, because they're cheaper to buy. And I like selling options when the volatility is high.

Starting point is 01:27:18 It's very simple. You could look at historic volatility graphs. Not everybody's into options, but I think Alpha Quarry has some good options, Bloomberg Terminal, refinative Terminal. You know, there are plenty of tools you could look at these, but most people don't. I want this option because I feel this. So it was a low volatility entry, and there was news over the weekend. And when you go from low volatility and added news, volatility skyrocketed.

Starting point is 01:27:43 So the options premium went through the roof. And within 10 minutes of market open, I'm like, get me out. I'm taking my profits. Had I held on, I probably would have made another 30%. But that's always how it is, right? You always sell it and then it goes up even more. Jack has a great option strategy that all of us call kind of dumb. But Jack swears by it. And we're not going to go too deep in the weeds here because he'll talk to you for an hour about it. And I'm sick and tired of hearing about it. Selling calls? Yeah, I'm just selling covered calls on stocks that I think are either fair valued, maybe a little rich, maybe a little bit cheap. But they have the high implied volatility. And so something like Robin Hood, which, I think is a pretty blue-chip stock, you can get two to three percent selling weekly covered calls. And realistically, you're going to make your money back, or if you just consider as decreasing your average cost by 3% per week, if the stock goes up, I don't really care if it gets called away from me, because the only way that I see it is in terms of a weekly percent change. And an annualized return is only just 52 weeklies combined.

Starting point is 01:28:40 And if you can make on average 2 to 3 percent, if everything goes according to plan, if it doesn't, it's fine because you're still holding Robin Hood and you made 2 to 3 percent on the premium. Right. Like, I don't see how you can lose, except for the tax consequences. Those can be pretty brutal. Sure. But I've been doing it in my Roth IRA, and it's been going extremely well.

Starting point is 01:28:57 Even with QQQQQQQQ, you can still make like 30% annually selling dailies because they have daily options. So how, so Jack's question is this. Yeah. Why isn't everyone making 90% a year selling call options? That's not necessarily, Mike. But that's what he implied. Because the market makers take all the money.

Starting point is 01:29:18 I hate to say that, but the more options volatility there is, the bigger the spreads are, the market makers never lose. I like that strategy what you're saying. If you're like, I'm married to the stock. I want to hold it. Great. In fairness, Robin Hood has also gone from $140 down to $70. I like Robin Hood.

Starting point is 01:29:36 I happen to actually like Vlad, and I actually think it's at a fair price, right? It shouldn't be down this low. But a lot of finance stocks are down, so it's not just Robin Hood. like SOFI went from like 35 bucks down to 16, right? It's just we are in a momentum driven market right now. And what's sexy right now is hardware and nothing else. Software's in the toilet, finance stocks are in the toilet, real estate stocks are in the toilet. Some of the pharmaceuticals aren't even doing well right now, which is crazy. So we're momentum driven. That's why Bitcoin, people are like, well, well, the stock market's at all time highs. Why is Bitcoin not at all time highs?

Starting point is 01:30:09 Well, it's not at all time highs because that's not where the momentum is right now. The momentum is in hardware stocks. That's it. So who makes money in the meantime? The market makers. That's why all the betting markets love people betting on like the stupidest, most random crap ever because the spreads are the widest. The bigger the spread, the more money they make. They don't make a lot of money on you selling options on the queues because the spreads are really tight. They're going to make more money on Robin Hood. But in fairness, a lot of your option money is probably getting paid by the Yolo weekly buyer. Yes, that is exactly right. That's why you have to go to Wall Street bets and find the people that are shooting that volatility up

Starting point is 01:30:47 and like paying crazy rich prices. Yes. Where if you're getting 3% on a blue chip stock, like the thing is, even if the stock goes down, it doesn't matter because it's such a large percentage relative to the share of the the stock. Yeah. And like, I don't understand how you can go wrong. Jack doesn't understand that he could have his shares called away.

Starting point is 01:31:07 The stock pops 15%. But that's fine. And then he's saying, well, I'll buy back in. And then he buys back in and the stock drops 15. But is that going to happen every single week? It's going to happen. I think you'll average probably less than if you had just held the stock and done nothing. I think that is possible, but this is more predictable. Yeah. I mean, it's how much work do you want to put into it too? For me, all I do is like the top of the week, Monday, I just sell a call on Robin Hood. I'm doing a

Starting point is 01:31:34 test right now because we collaborated with the money guys. And we went back and forth on this strategy and I was like, guys, I've never done it like weekly because it's just never been worth my time. And everyone tells me it's a dumb idea. So I just believe with. they say. And so I'm like, I'm not going to do it. But now because we're all in a group chat, I can add you to the group chat, and I send my reports every week. And I will say. And guess who's up three percent in one week? What's interesting is there are a lot of hedge funds and financial advisors who know that there are so many people who are buying these short-term options that you can make some spread. So yeah, you're you are picking up onto something that institutions love.

Starting point is 01:32:09 You have to go into the stocks that have the high volatility. The stocks that everyone super hyped about because realistically, if you try to sell calls on something with a bunch of volume, like you want to sell calls on Apple, like no one is going out there buying weekly calls on Apple because they think it's going to pop. Right. Unless if maybe they're doing a new dropper release. But on something like Robin Hood that dropped as much as it did, everyone is just waiting for it to completely skyrocket, which even if it does, and I get the bag called away from, it doesn't matter. The bag. Oh. Well, to me, the way I see it, it doesn't matter because I still made my 3%. That's fair. So, yeah, I agree with you. If you go to the ones where ever,

Starting point is 01:32:44 everyone's chasing the money, then it's... It's funny. That's why so much of this makes me think, like, the millennial money podcast could be like all over this, right? The good old days, if you will. But it's so funny because I feel like a lot of us, I guess I can't speak for everybody, but it certainly seems like you guys and me to some extent here

Starting point is 01:33:06 feel like, hey, like there's so much to talk about in finance, but we are also so removed from that daily struggle of, you know, filling up the tank or your credit card bills or, you know, wanting to get ahead and get a home or you're having a baby and it's like, crap, these are a lot of expenses. So it's fun to talk about all these things, but I go back to like the early part of the pod where we're like, man, how does this affect like the consumer, that regular person? And it's, I think every single year from now over the next 10 years, it's just going to get harder and harder and harder. So if there's any motivation to leave from all of this, I would say

Starting point is 01:33:45 the sooner you can grind and make more money now, the better, because it's just going to keep getting harder. So if you're to give one piece of wisdom off of that, what would it be to the viewer? So grinding is very, like, it's hard to quantify. It is because you got to grind on the right thing. So, you know, like, I always make the analogy. You can only be so good of a forklift driver, and you could go, you know, do laps in the forklift all over and over and over again, but, you know, your money is going to be capped. To some extent, the same is true of being a pilot. You know, how many times can I land this plane and how smooth can I make that landing?

Starting point is 01:34:21 You're not going to get paid anymore if you butter the landing, right? So it's got to be where you're able to make more money. And usually that's entrepreneurship. There are, though, people who can work for startups or larger corporations that have growth. You know, a company that's growing, great place to work. You don't have to be on your own. A place you can clock in at A and clock out at five is great, especially if you're at a growing company, is eventually you'll probably get stock options and you'll be able to grow with that company. So I'm a big fan of being either at a company that's growing or finding a vertical that you could really use your energy with AI and accelerate. Like bookkeeping, we said, accounting, whatever, lighting. You know what Chris Camillo said? He said his prediction was that, podcasters. Over the next 10 years, you're going to be the next professional athlete. That's interesting. The New York Times just had a piece yesterday about how YouTube is so desperate to get even more podcasts onto the platform. They're going to celebrities. They're pre-setting up

Starting point is 01:35:23 sponsors. And they're like, hey, do a podcast, hosted on YouTube. We'll get it all set up for you. will even place your first sponsors so that that very first episode you make, you already know you're going to get paid X dollars by this. I think it's a terrible idea. I actually think it's a great idea. I think it's a terrible. No, no.

Starting point is 01:35:44 Just because they're famous, they could attract initial attention. It happens all the time. They start a podcast. They get a few episodes that hit, and then it's boring as hell. You have to be... You have to pick the right guy.

Starting point is 01:35:54 You pick a Matthew McConaughey. He's going to have a banger podcast. He doesn't need to do a podcast. You have to find someone hungry enough and interested enough to do podcasts and in the game of the algorithm. I will say like LeBron James, his podcast does incredibly well. Like you have other sports people that are not podcasters. Like you want to tune in to the podcast where they're talking about, you know,

Starting point is 01:36:13 game seven finals. And it's an ex-NBA player and they're being, they're able to cover it. Like that's, you can pick the right person. If you find the right talent, I do think that there's still like a ton of demand. Even like the rewatch podcast. Like the, listen, I think there's a lot of demand for podcasts.

Starting point is 01:36:27 My thing is that if you're bringing in a celebrity is that, the poll, I don't see that at all. I don't get it. I think YouTube channels and media are so fickle that it's like a needle in a haystack and like, hey, you maybe do a hundred of these and a few of them stick and it's just the numbers game. I mean, I agree. You have to be entertained. There are some podcasts that are popping up now that are like covert big mainstream media. Like there are some, even in the finance space and they're getting like a lot of these podcast interviews or whatever with people from finance and you dig into it a little bit and they literally worked for CNBC.

Starting point is 01:36:59 Yeah. You know, or Bloomberg. And they don't advertise that they do. So they come across as like, oh, yeah, I'm just so. You know, it's so funny, man. There's a big company that I did a, like, a free consulting thing with. And I was telling them their social media sucked. And my advice to them was start a podcast.

Starting point is 01:37:17 Do a podcast. You have access to, like, all these people, all these, like the top talent. Like, this would be the best use of it. They didn't listen to me. And I'm honestly, like, I'm looking at that and thinking, you're an idiot. it for not listening to me. But I think for big businesses out there, that's the best way to do it. Oh, totally.

Starting point is 01:37:34 I don't know why Robin Hood does not just, like, acquire us. Dude. Or, like, sure. Like, it's, it's so incredibly, if we just had the Robin Hood things right here, and there was a Robin Hood segment on every podcast, or I could show my Robin Hood collapsing portfolio. If I could just show that every episode. He's literally buying call-ops.

Starting point is 01:37:50 I'm buying call-off. Zero day. No, no, because, because, you get these, uh, what is it, these big, like, like, Black Rock is buying, uh, YouTube channels. What is this? What are we called? Like institutional buyers are coming and buying YouTube channels? Oh, I didn't know that. It's massive. Because I know Robin Hood started their own podcast and they look at like stock charts and stuff. There's this video that went viral that was like your favorite YouTube channel is corporate owned. Oh. And they listed out a lot of YouTube channels that actually had corporate backing that you would never know.

Starting point is 01:38:21 And believe it or not, because they have ownership, you don't have to disclose that like this is an advertised product. Wow. And so this YouTube video explained it, and I'll just, I'll link, you'll see it here on screen as we're talking about. I want to check that out. That's interesting. But I am astounded that we haven't gotten any offers. And I'm thinking, like, we are the best acquisition for the right company. You're like putting a hot air balloon out there.

Starting point is 01:38:46 Like, hey, guys. We're for sale. Take us. Obviously, we wouldn't sell all the like just Joe Schmo. Yeah. But, like, listen, if the numbers make sense. I got house tax shares. If the numbers made sense.

Starting point is 01:38:59 We wouldn't just go to anybody. But China has a big budget. Xi Jinping comes over with his yen. Yeah. I have no problem complimenting his haircuts. Hilarious to talk about the latest Chinese electric car.

Starting point is 01:39:13 It's all just like dubbed in China. Oh my, yen, you won. Yeah. Anyway. Oh, dear. That would be hilarious. I told Jaguar about, I don't think I've ever talked about this before. 2021, I got an offer for $2.2 million

Starting point is 01:39:26 to buy 10% of my YouTube channel. Oh, really? Yeah. Oh, wow. They were reaching out to all the finance channels at the time. And what they wanted to do was IPO. They wanted to acquire like a few dozen finance channels specifically. And then IPO it. And then people could invest in the stock, which is backed by your YouTube channel and a portion of your earnings funnel into this. And I said no to it. And the reason why is because I said it's such a terrible investment to pay this multiple that they were offering me, I'm like, you're never going to make your money back.

Starting point is 01:40:00 And then what's inevitably going to happen, the stock's going to fall. Yeah. And if my name is attached to that stock, it falls, there it goes. And it's not worth it because it's a bad, and what's funny is that I was talking to these guys in their 50s and 60s who are like corporate dudes,

Starting point is 01:40:15 and I'm telling them it's a terrible idea. Like, your offer is more than, it's just a really bad idea. You're never going to make their money, ever. And what's funny is that I know a few of the chances. that sold to them. Oh, interesting. And they're in the toilet. Really? Yeah, because they were on the run up from like 2020, 2021. And I'm like, dude, I've never seen these views before. I've never seen the sad revenue before. That was crazy. It makes no sense at all. And this is not going to continue. And those channels that did it, their views dropped probably 90 plus percent. And this, this stock

Starting point is 01:40:48 is in the toilet. Sure. Oh, so it actually did go public. It did. Oh, wow. They've, Yeah, it's funny, or maybe not funny, but there are so many CEOs that I'll see that go on essentially CNBC and Bloomberg and they complain about how the stock market is treating their stock because they see it as a reflection on them and the quality of the business. And it kind of makes sense why a lot of companies are staying private longer. Like, I think you've made videos on this before. Maybe not. I don't know. But there's this idea that companies have stayed private a lot longer because we're. Why do you want to deal with being in the regulator's eyes?

Starting point is 01:41:26 You've got a momentum-driven stock market that's going up and down on a daily basis. And the stock's down 5%. You're getting blown up with emails going, what did you guys do wrong? And it's like, bro, we're doing the same thing every day. And like the stock market's manic. I honestly wonder if Warren Buffett would go public in this kind of environment that we're in today. I think it's an interesting thing to speculate about because I don't think he would. I am going to give you a great idea for a podcast and anyone could steal this.

Starting point is 01:41:51 I told you, Jack, this is a banger idea. I started seeing these clips on Instagram of a father just talking to his toddler, who's like three years old as a podcast. Wow. And you see the toddler in the chair with the big mic, and he's like, so what do you do today? Oh, I want this thing. And then I got mac and cheese.

Starting point is 01:42:09 He's like, what did you like the mac and cheese? Could we get ice cream? And the guys are like, well, a little later we could get out. Okay, because I really like ice and the vanilla flavor. And it's like, so cute. How could you not watch that? And just it uplifts your day. Because it's like you're scrolling and you're seeing this disgusting vile stuff in your feed and negativity.

Starting point is 01:42:34 And then you scroll and you see just a kid just eating ice cream and having a great time. I'm like, that's a great idea. Let me just say he has never had urgency to have a child. And then he said this podcast and he said, you could probably make like 30K months. And I'm like, are you saying you now want to have a child knowing you could make a podcast to generate? Like, I'm not going to get the wrong day. And he's like, well, you know, it's pretty easy. I'm like, dude.

Starting point is 01:43:01 It would be easy. But how wholesome is that? It's just a big, because listen, most parents. Dude, for a 30K a month, freaking give me a shave my head bald. Give me a big lollipop and I'll be the baby. Like we could do that. You and me, man. I would almost pay 30K to be able to do that.

Starting point is 01:43:17 Big swirly lollipop. Yeah, dude. Come in. You're in like a diaper. Yeah. Doesn't matter to me. One thing that I found for me is, or my channel is we've really, I try to niche it down, really, to a finance person. It's way more even niche than I think you do.

Starting point is 01:43:37 Like you do great. But like some of my stuff is just really niche into this finance person. And I think it's, you know, either an entrepreneur who wants to build wealth or maybe, I mean, my average ages are like 25 to 45. That's sort of the big curve right there. I don't get a lot of high school or younger than that. I actually have more people that are seniors than are under 25. And for me, I think it's helped us build house hack, you know, because I look at it. When we first raised money, we raised 25 million, you know, and we've had more raises since then. The last fundraise we did, we raised $37 million. And so what's interesting is even though I might get fewer views,

Starting point is 01:44:19 per video, we've raised more money than ever before. And so I think it's because of niching town and providing more value on finance. And so if there's any reason I wouldn't do a podcast with Jack, it would probably be that long-winded response to that. But I do actually think, you know, like a family, an occasional family vlog video would be fun. I don't know if anybody would watch it. I'd like to make it. What would do well is a family dinner podcast. Oh, interesting. I'm just a family table talking about, like, what did you do today? I clean the floors.

Starting point is 01:44:53 I did this. What did you do? Oh, work was kind of tough, you know, Joe, who was over there kind of like fumbled a little bit. We lost a client this week. Yeah. It's okay. And like, the kids like, oh, I had my math desk. I would love to just be a fly on the wall.

Starting point is 01:45:08 I wish I could have a functional family dinner without kids throwing food at each other or somebody screaming. Retention spike right there. Somebody crying, right? Like, yeah, true. I mean, there'd be plenty of those. But at least with seven, it seems like there's always somebody pissed off. They all sleep well, but boy, we did not invest enough money into actually getting them to sit at the table. Yeah, it's tough.

Starting point is 01:45:33 You'll see one day. How many children are you going to have? I'd say two to four. And what about you? Two. Two? Probably. Yeah.

Starting point is 01:45:42 Yeah. Trying to get to 12. You really? Yeah. Why? I want double digits. And I don't want it to be 10. and I don't want it to be odd.

Starting point is 01:45:50 But why? Yes, it can be 14. But what joy do you get in having 12 kids versus 7? They're all different personalities. It's the weirdest thing. I thought they would all be clones. I honestly thought this, that, oh, five children all in the same time, they're all going to be the same.

Starting point is 01:46:12 Every single one of these kids, even the identical twins, totally different personalities, every single one of them. Jack, Max, totally different personalities. The five babies, totally different personalities. I had a dad or a moment today. I got one of our first of the bunch, twin, one of the first twins, got her to go poo in the potty. That's a big milestone.

Starting point is 01:46:37 You got her to do that? I got her do it. Well, I saw her kind of like grabbing her leg pants and I'm like, do you have to go to the bathroom? She's like, yes, potty. So I took her over to her little potty. And her sisters come running in, everybody's looking and I'm like, no, wait, do you really have to go? She shoes off, dad, shoes off. I go,

Starting point is 01:46:54 okay, other girls out. One of those ones. It took her, yeah, took her pants off, gave her her privacy, put her down, walked out, came back giant poop. Greatest dad moment ever. She didn't flush. She didn't flush. But mom didn't get it. Nannies didn't get it. Dad got it. How did that feel? Oh, like, I've been, I think I've probably told Lauren like 20 times today. And she's like, I, I, know. So how do you not look forward to that? It's, it's just, it's just fecal matter. I don't know, man. It's just like, it's a shit. Could have henta virus. That's where it all started, man. It's just like, it's a bodily movement. It's just like, I don't, but for some, that's a big deal. But maybe it's different when it's your own. Like, I hear that. I'm like, it's a first, though. It was a first time in a

Starting point is 01:47:47 In the toilet. In a toilet. It's light. Do you know we go through about a thousand diapers a month? Yeah. That's a Mediterranean diet. Isn't Gavin Newsom giving you some diapers? That's true.

Starting point is 01:48:00 Yeah. Baby born. More free stuff. Good. Gas might be $750 and houses might be unaffordable. Well, you'll get free diapers and we'll tax you 55%. Welcome to California. Could you technically structure your income under the poverty limit to then be able to get

Starting point is 01:48:15 like all the free subsidies? Yeah. Sure. You could also take write-offs. Yeah. Like, I mean, if you buy equipment, right, and depreciate it, whether it's a plane or whatever, yeah, you could write your income down to zero, qualify for medical. I don't structure my income, though, but I think there are a lot of handouts, and it's going to get worse. Are you doing the Trump account? Well, my children were born after the Trump accounts. I thought you could. Can you enroll?

Starting point is 01:48:41 Yeah. I would do it. Sure, because I do 529s for them. I pay the children to hold coupon codes so that way they earn a salary and they have earned income and then they can invest in their rough. So I'm a big fan of that. I'd consider the Trump accounts. I haven't really looked into that yet. I thought it was just they had to be born. I could be incorrect. Oh, I'll look at it. It was a great thing to look up. It's $5,000. Total. Yeah. Across the kids. I'm a big fan. I think it's great. And any of those tax advantages, HSAs, I'm a big fan of use them. So yeah, but more children. All right, Kevin.

Starting point is 01:49:17 So thank you so much for your time. Thank you for the flexibility. This is pretty last minute. We have one final question. If you were to leave the viewer with one piece of advice, what would it be? Don't ever skimp on experiences. Spend on experiences with the people you love. And the second thing is, if you're jaded about AI, know that 80 to 90% of other people are as well,

Starting point is 01:49:40 you got to be part of that 10 to 20% that's going to take you to the next level and whatever. you do. And if you can do that, no matter what your job is, you will always get a job at any corporation. You'll be the last to get laid off. What's your advice? I didn't think you're asking me the question. Well, that's what makes it fun. Yeah, yeah. First thing, go ahead. First thing is just always work more. But, like, I don't know if that's, I'm always just like, just double down, just whatever you're doing is work more. It's, it's weird. I have honestly, I feel like I've been working fewer hours and getting more done.

Starting point is 01:50:20 I'm not just blaming yet, but I've had time to go on runs and walks and go to the gym. You know, I cook bread now. I have a little garden. A little moss garden. I bought a gong. I play my gong.

Starting point is 01:50:34 You know? Okay, well, here's, I'm going to dive deeper. And I know I've had time to think. I think most people only use a small fraction of what they are capable of. And that if you had a gut to their head and they say you have to do this,

Starting point is 01:50:45 this or it's over, they'll do it. So they have what it takes to do it. But most people don't operate like that and they'll not utilize everything they could. And so I think if you just approach the day as though you have to do it otherwise lights out, you'll be able to accomplish so much in the same amount of hours that you wouldn't otherwise have done. I agree with that. I mean, Jensen just did an interview like 10 days ago, CEO of Nvidia. He said, you're underestimating your potential. That was sort of his like walkaway line. Like you're,

Starting point is 01:51:20 and it's essentially the same thing you said just in a different manner, which is you don't even realize that you can do so much more. You know, I do this little trick where there are many times I don't want to work out or I don't want to do a work project or I don't want to send an email or don't want to write the letter. And so I call it microgrind. And I try to convince myself like,

Starting point is 01:51:40 okay, I have those feelings coming in that I don't want to do this. Just get it done. Don't be a little B like, like Grant Cardone says, don't be a little B, just get it done. And then I make this little challenge out of it. Like, well, if I micro grind it and I just get it done really quick, then I get it done, and I get it done. And I get it done. It actually gives me more free time. So I agree with you. You know, you could definitely double down and get surprisingly a lot more done than you think in a day. Now, what's yours? One of the most important predictors of success is your response to failure. And I think that if you can see failure as an opportunity to learn and to pivot and to. do things differently, then you win from your successes because you won, like there's a yield, there's a reward there. And then from your failures, all it is is more information. Yeah. Right.

Starting point is 01:52:25 Like the thing that will cause you to lose is inaction, not action. And if you could see a failure as an opportunity to think, okay, what did I learn from this? And I'm going to try something a little bit differently this time. You're coming in with more of an educated perspective, a more experience-based perspective to increase your likelihood of success. And you feel right there, that's another opportunity. So it's like, how much? much consistency and how much, I would say, devotion do you have to the craft? I think that's so amazing. I would actually say the best people to hire if you're at a company or your managers thinking about who to hire or who to promote. The best person to hire, the best person to

Starting point is 01:53:02 promote is somebody who has had a lot of failures themselves because they have the experience and they know how not to fail. And you know they're not going to give up if they fail. Yeah. Well, thank you guys so much for watching. And by the way, if you want the extended version of podcast because we had to cut it a lot for retention purposes because we know a lot of people might not be interested in some of the weeds and the nitty gritty. Feel free to join as a channel member and you're going to get the extended cut. No ads, no sponsors, and you get early access to all of our future episodes as well. So feel free to join.

Starting point is 01:53:34 Really appreciate it. And I'm personally responding to all the comments on members. That would be absolutely incredible. All of your stuff is linked down below, Kevin. Thank you so much for coming on the podcast. And lastly, we have a new business that we're working on. And if you want to be a beta tester of it, it has to do

Starting point is 01:53:48 with credit cards, you'll get some money back. If you're nerding out about like sign up bonuses getting the most amount of money that you can, squeezing every drop that you can out of the cards, sign up. The link is also down below in the description. You will not regret it. All you have to do is go to extra dollar.

Starting point is 01:54:05 Extra dollar.com. Extra dollar.com. Boom. Bought the domain. $7,000. I think it's $5,000. $5,000. Guys, thank you so much. Until next time. Until next time.

The Iced Coffee Hour - Stocks Just Hit ANOTHER Record High - WTF Is Happening?! | MeetKevin

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