Everyone Hates AI (EP. 453)

Summary

Animal Spirits Podcast (EP. 453): "Everyone Hates AI"

Date: February 25, 2026
Hosts: Michael Batnick & Ben Carlson

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Episode Overview

In "Everyone Hates AI," Michael Batnick and Ben Carlson dive into the mounting anxiety, market reactions, and existential questions surrounding the latest wave of AI pessimism. Using a viral research piece as a springboard, they examine how fears about AI-induced white-collar job losses and economic disruption are affecting sentiment and the stock market. The duo weighs doom-and-gloom scenarios, practical investment strategies, and the enduring role of the human element, while exploring how headlines, narratives, and Twitter are feeding a real-time market feedback loop. As always, they spice up market discussion with personal experiences, cultural references, and their hallmark banter.

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Key Discussion Points & Insights

1. Viral AI ‘Doom’ Research and Host Reactions

[01:48–07:36]

• Citrini Research Piece: The hosts discuss a widely-read bearish AI scenario that painted a 2028 world with 10% unemployment and a 40% market drop, sparked by rapid wide-collar job displacement.
• Emotional Responses:
  • Michael admits: “The human element of it breaks my heart a little bit.” (02:28)
  • Ben tries for optimism, calling it “all science fiction still... None of this stuff has happened yet. The unemployment rate is at 4.3%. Come on.” (03:46)
• The Power of Narrative: Michael acknowledges, “Morgan always says best story wins. This is a really well done story ... I don't know enough about each of the industries to say 'that can’t happen'." (10:45)

2. AI Anxiety, Markets, and Human Nature

[07:36–15:14]

• Friction vs. Relationships:
  • Michael quotes the piece: “Turns out that a lot of what people called relationships was simply friction with a friendly face. And that is some real talk." (07:10)
  • Ben firmly disagrees: “That's the most wrong thing in the whole article." (07:36)
• Network Effects & Human Behavior: Ben: “The human element ... there's no way you can take away the human nature out of this. That's the part, Pete. I absolutely say throw that in the garbage.” (08:35)
• Barriers to AI Proliferation: Technical, economic, and behavioral limits are discussed (e.g., high compute costs, “these agents are very expensive” [09:54]).

3. Market Reaction – Are Investors Getting Ahead of Themselves?

[11:10–16:19]

• Beauty Contests and Meme Stocks: Ben compares the panic response to prior bubbles, saying: “Investors are trying to think about what other investors are going to do next.” (11:10)
• Pricing Information vs. Overreaction:
  • Michael: “I do think there's information in American Express and Capital One falling 8% of the day. But, but I also think it's an overreaction...” (12:22)
  • He describes his approach: “I'm going to buy Microsoft today. I am running into the fire. That's the only thing I know how to do when I'm scared." (12:54)
• Buying Amid Panic: Michael lists his recent buys – Blackstone, Salesforce, ServiceNow, Netflix, CrowdStrike, and Microsoft – noting significant drawdowns: “I know this is a bad strategy... I'm not trying to make you feel better. I'm trying to make me feel better.” (13:12)

4. AI, Productivity, and the Nature of Work

[17:04–21:34]

• Using AI at Work: Both hosts agree that AI makes them more productive, not less busy.
  • Michael: "Every time I open these things up... I feel like I'm getting so much smarter, so much more effective." (19:44)
  • Ben: "Are you working any less because of this?" Michael: "No, no, no." Ben: "Same for me. I'm working more. I'm doing more stuff because of AI." (20:14)
• Transition Turbulence: Both recognize the disruption for some workers will be “very painful,” but Ben takes heart in historical precedent: “What did they do before? ... The transition period... is going to be very painful.” (20:33)

5. Social, Political, and Human Backlash to AI

[21:48–25:44]

• Hostility to the Boom: Ben shares a quote: “I can't remember a boom with such active hostility to it. People used to find new technology exciting ... AI is notable, perhaps unique, for the lack of enthusiasm.” (22:25)
• Communication Failures: The tech industry is failing to explain why the public should want AI. Ben: “Tech people have done a horrible job of telling people why they should want this technology.” (22:34)
• Societal/Political Risk: Jamie Dimon is quoted questioning whether mass white-collar automation is “good for society.” (23:36)

6. Market Structure, Rotation, and Breadth

[27:30–35:43]

• Broad Market Health: Though many tech names are in a correction, global market breadth is robust.
  • Ben: “66% of index constituents are outperforming the S&P itself, which is nuts.” (27:45)
• Cautious on Tech Drag: Michael is wary: “If the Mag 7 keeps getting killed, like the market can only take so much... the Mag 7 as a group can't fall 20% without ... bringing the market down.” (29:32)

7. Individual Stock Picking vs. Systematic Investing

[28:42–45:04]

• The Pain of Owning Losers: Michael and Ben discuss abandoning single stocks for systematic strategies.
  • Ben: “Do you know how much less brain damage I have now that I don't have to, like, check my app every day to see how my individual stocks are Doing?” (44:53)
  • Michael: “Why would you ever buy another individual stock ever again? I say to myself as I'm buying another individual stock at the open.” (44:08)

8. AI and Labor Markets: Signals and Noise

[45:35–48:03]

• AI-Exposed Industries: Charts show negative job growth in industries exposed to AI (Management Consulting, Graphic Design, etc.), but Ben attributes this to post-2021 overhiring, not AI itself. (45:59–46:07)
• Tech’s Place in Employment: Tech is still a tiny fraction of total US jobs (“tech employment accounts for only 2.3% of overall payrolls in software publishing for just 0.4%”). (47:12)

9. Financial Sector Woes: Blue Owl and Private Credit

[57:06–64:49]

• Private Credit Issues: Michael provides a nuanced breakdown of turmoil in BDCs/private credit and why some of the panic may be overdone despite real problems—especially the lack of communication and transparency from Blue Owl.
• Valuation Gaps: Markets are discounting portfolios as if a global financial crisis were imminent: “If you take OBDC's discount literally as a pure credit loss forecast, the market is pricing something like a GFC level or worse." (63:13)

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Notable Quotes & Memorable Moments

• On Market vs. Narrative:

  • Michael: “Watch what people do more than what they say and you'll learn a lot more.” (48:44)

• On Human Element in Transactions:

  • Ben: “You don't need a human to buy a house right now because all the information is there for you to see. It already happened. And we still require humans..." (07:44)

• On Why People Hate AI:

  • Ben: “The tech people have done a horrible job of telling people why they should want this technology.” (22:34)

• On Investing During Fear:

  • Michael: "If you've ever said buy when there's blood in the streets, if you're selling here, you're a clown. ... If you are selling right now, you don't get to quote Warren Buffett ever again." (31:13)

• On AI Disrupting White Collar Jobs:

  • Michael: “It's coming for white collar workers, because for blue collar workers that took place over 30 or 40 years... That's why it's so scary.” (52:00)

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Highlighted Timestamps

• AI Doom Piece and Human Impact: 01:48–03:46
• Debating Human Value vs. Automation: 07:10–09:16
• Buy/Sell Decisions Amid Panic: 13:12–15:16
• Psychology of Market Rotation: 28:05–29:59
• Political/Societal Reaction to AI: 21:48–23:55
• Stock Market Breadth and Rotation: 27:45–29:32
• Blue Owl/Private Credit Crisis: 57:06–64:49

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Episode Tone & Style

Staying true to Animal Spirits tradition, the conversation is candid and self-aware, balancing anxiety with humor, and bears and bulls alike with humility. The hosts openly share doubt, confusion, and changing minds, all while reminding listeners that sentiment, story, and stats are as tangled in investing as ever.

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Closing Thoughts

Despite the prevailing AI “doom porn,” Michael and Ben ultimately argue that, while disruptive technology causes dislocation and pain, panic can create buying opportunities for long-term investors. The human element, adaptive markets, and the cyclical nature of narratives are recurring themes. As for the rest? The story isn’t written yet.

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Culture, Recs & Lighter Moments

• TV & Movies: Game of Thrones spinoffs, revisiting The Sopranos, classic action movies (Terminator 2!), and the increasing length of modern films.
• Comic Relief: "I'm buying Microsoft right now. Bear with me. First time, long time I've done this on the show. Locked in." (36:01)
• Personal Reflections: Michael on his dump runs being “AI-proof,” and why Netflix, despite being a category winner, has underperformed benchmarks.

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For full show notes and disclosures: The Compound – Animal Spirits

Transcript

[Michael Batnik]

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[Michael Batnik]

Position your investment portfolio for wider equity participation with fundamentally driven Clearbridge active equity strategies. Clearbridge, a Franklin Templeton company. Go to clearbridge.com to learn more.

[Ben Carlson]

Welcome to Animal Spirits, a show about markets, life and investing. Join Michael Batnik and Ben Carlson as they talk about what they're reading, writing and watching. All opinions expressed by Michael and Ben

[Michael Batnik]

are solely their own opinion and do

[Ben Carlson]

not reflect the opinion of rich wealth management.

[Michael Batnik]

This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this podcast.

[Ben Carlson]

Welcome to Animal Spirits with Michael and Ben. Michael, I talked to you yesterday. You were feeling a little. A little down, I think. Is that fair to say? Not down, just okay. The AI doom has reached escape velocity and it's now a daily weekly occurrence where you have one of these big pieces that paints the doom. And as a glass half full guy, I like the other side of these. But I don't mind the AI doom porn. I think it's good to go through these scenarios. I don't necessarily agree with them, but I think it's probably healthy for people to think through what the potentially bad ramifications could be on these things.

[Michael Batnik]

I appreciated the craft and the effort behind the post. I thought it was incredibly well done. It comes from Citrini research and this person is not a bear pornographer like this is a legitimate research person. They are not one of these people that has been saying the world is going to end for the last 10 years. So I think that context is important. We'll get into some of what was said. The part that bummed me out the most is let's say that I don't know, 30% of it comes true. Who the hell knows how to handicap this? The thing that I was thinking about where my head went was there are people in and around our lives, everybody listening, who are going to be impacted in a material way and they don't know it yet. And I can see this coming where there will be people that get laid off from a, a very nice white collar salary that won't be able to replace it. And they're first they're going to miss a vacation and then they're going to miss a this and then their kids won't be going to camp and then they're going to have to move. And that is going to happen all across the country. And the human element of it breaks my heart a little bit.

[Ben Carlson]

All right, maybe we don't know yet. We still don't know how this is going to play out. To me, this is all science fiction still. Okay, none of this stuff has happened yet. The unemployment rate is at 4.3%. Come on.

[Michael Batnik]

Yeah, but, but, but isn't there, but isn't there an inevitability feeling that you had reading this?

[Ben Carlson]

Well, listen, here's my take.

[Michael Batnik]

Even, even if it doesn't lead to 10% unemployment, I mean it's not, it's not a stretch, like it's not the, the thing that bummed me out.

[Ben Carlson]

But the Michael arguments always sound more plausible. Always some more plausible. Yeah, always. I agree. This, this, this stuff is more plausible than a lot of the other stuff. The technology people have been telling us is going to happen the last five to seven years. But a lot of the stuff they've told us hasn't happened.

[Michael Batnik]

That's true for me. This feels personally different from every other stock market linked event. And it is wild that what this piece did to the stock market yesterday, which is already very fragile on thin ice, what it did to Capital One and American Express merely by mentioning what would happen with stablecoin. So this piece went mega, mega, mega viral.

[Ben Carlson]

It actually did move the market.

[Michael Batnik]

Yeah, no, it really did. But I feel like for the tariff tantrum, like I think there was a, I was able to look past it a little bit because it wasn't. Yes, I guess the global World order was changing, but like, it was very easy to see that maybe not in real time, that like it was hyperbole that he was going to be able to walk some of these things back and not just the Tower of Tangent, but every, every like, market related sell off. When in the spring of 2022 when Netflix got bombed out. I know that's like a very, you know, it's a Netflix issue specifically because they had business issues, right? Like they lost subscribers and they were able to figure it out eventually. This is just so much bigger than all of that. And it does seem like there's an inevitability of some of this happening, even if, even if it's overblown.

[Ben Carlson]

All right, I, I'm gonna, I'm gonna paint it with a, with a much brighter brush than you are. So it starts out saying that in 2028, you know, the unemployment rate is 10% and the market is down 40%. And the reason for this is because AI leads to white collar job loss, that leads to demand slowing, because who's going to spend money if bunch of people are losing jobs? And that in turn impacts the economy. That's the TLDR of this piece, right? Even though it was a lot longer than this and it went through specific examples and it's basically saying, like, listen, AI exceeded all expectations. It's just the economy wasn't ready. It says the AI capabilities improved, companies needed fewer workers, white collar layoffs increased, displaced workers spent less margin pressure pushed firms to invest more in AI and AI capabilities improved. And it was a negative feedback loop. That's what it's saying happened. And then it's also saying, you know, this is going to impact the mortgage market because people aren't going to be good on their loans. And that was the cascading like, oh no, here's the doom. Okay, I get it.

[Michael Batnik]

Before, hold up, before the other side, there was two things in particular that like, and I, I'm, I'm generally always in the same mood. I'm not a moody person. Like, I, I don't, I don't have a temper. I never yell in my house, except for when my kids are getting me upset. Like, I'm a very sort of down the. I don't wake up on the wrong side of the bed. But this definitely changed my mood. Financial advice, tax prep, routine legal work, any category where the service providers valued disruption was ultimately, quote, I will navigate complexity that you find tedious, end quote, was disrupted as the agents found nothing tedious. And here was the coup De Grace in terms of like putting my, my head in my hands. We had overestimated the value of human relationships. Turns out that a lot of what people called relationships was simply friction with a friendly face. And that is some real talk.

[Ben Carlson]

I absolutely don't agree with that at all. I think that's the most wrong thing in the whole article.

[Michael Batnik]

Oh, God. Over to you. Make me feel better.

[Ben Carlson]

There are so many things we could do right now without human relations that we choose to do. So the big one that they talked about was real estate. Like, hey, listen, agents are going to be able to comb through everything. Listen, real estate has already been disrupted by the Internet. You can go on Zillow and find anything and everything you want about a house, how much it sold for in the past, all the different rooms, what people have said about it. You couldn't do that in the past. You literally had to go to a house. And realtors still exist because people like working with humans to make these transactions possible. You don't need a human to buy a house right now because all the information is there for you to see. It already happened. And we still require humans think about all the things that we could have done this with and we didn't. Okay? So I think that this is just making a huge leap. This is like. This is like saying everyone in the world is going to act like an Economics 101 textbook. Everything is going to follow supply, demand. You're going to look out just for yourself. And that's just not the way the world works.

[Michael Batnik]

True.

[Ben Carlson]

The biggest thing that they said that like it's going to be disrupted is network effects. There's going to be no more network effects because these agents will find everything. And I just don't really agree with that. I think network effects are still going to be very important. And you're going to. Because you look to see what other people are doing to do stuff that makes sense to you. You don't do it just because this is the absolute right decision. There's. There's jealousy and envy and what is the cialdini call it? Like, you look to see what other people are going to do and then you do it yourself. Like that stuff still exists, the human element. Like there's no way you can take away the human nature out of this. That's the part, Pete. I absolutely say throw that in the garbage. That is not how the real world works.

[Michael Batnik]

All right. More practically, Gavin Baker tweeted. And Gavin is all over the stuff. He's an analyst, he's a He's a pm. Love the Citrini piece. Thought piece, however, seems unlikely we will have enough compute for the scenario in 2028 or even the early 2030s. Distillation, quantization, and I cannot bridge the gap. AGI is an event horizon with a significant compute dependence. So I said, oh, enough said. I feel much better now. And then I saw Jake's tweet. Economic said, the AI will create new jobs we haven't thought of. Argument falls apart the moment you assume AI will probably be better at those jobs too.

[Ben Carlson]

But here's, here's the thing though. I thought the best pushback was this stuff costs money. Like, running these agents is very expensive. You can't just say, I'm going to have AI run these agents for me all day and all night and they're going to find the best of whatever's out there and they're going to do it all for me. It costs money. It's going to be cost prohibitive. And then guess what? Other companies are going to say you're going to have to go through 50 different steps and you're going to be running your agents so hard and, and you're going to spend so much money to do this stuff, it's not going to be worth it anymore. You don't think that there's going to be hurdles and places?

[Michael Batnik]

Of course, of course, of course, of course. So, all right. On the one hand, I definitely feel bummed out and I'm not going to say that I feel a lot better this morning. Like, I'm still pretty uneasy about everything. And there are people. I saw people like, did this only just occur to you? Like, why are people.

[Ben Carlson]

It is weird that we've been feel like we've been talking about this for two years now. Like, what I could do to people.

[Michael Batnik]

Yeah, you know what? I guess this was just so well done. It just seemed like, yeah, this could happen again. There's. There was a million different industries that he got into quickly that I don't know if I'm gullible. I'm sure I am. To a great story. Right. Morgan always says best story wins. This is a really well done story. And I don't know enough about each of the industries to say, oh no, that can't happen with these agents with doordash or whatever.

[Ben Carlson]

Can I, can I give a market explanation of this though? This is back to the Cannes beauty contest. This is kind of like how what happened with crypto and what happened with Meme stocks is that investors are trying to think about what other investors are going to do next. What's the, what are people going to think the next meme stock is? And so they think, listen, everyone thinks software is going to be disrupted. What companies do they think are going to be disrupted next? And let's sell those. And I think that's where a lot of this is, is just getting ahead of it. So I thought Ben Thompson had a really good piece this morning. He said, he said basically the view in this article and from all the anti monopolist is grounded in a fundamental lack of belief in dynamism, human choice and markets. DoorDash didn't always exist because doordash was one of the big things he took down. He said, hey listen, there's going to be a million apps being created and they're going to create their own DoorDash. DoorDash ceases to exist. So he said DoorDash was built and it wins through affirmative choice of all three sides of the market. It serves customers, restaurants and drivers. Does the company have varying degrees of power over different sides of that market based on its dominance of other sides? Absolutely. But that power flows from delivering value, not from extracting it. And that's the whole point is that like these companies exist not just because like ah, we use them, because they make us use them and we're forced to like there's the human element here, cannot be taken out of this.

[Michael Batnik]

Yeah, okay, so that part I totally agree with. And also for as, as not great as I'm feeling, which I hope will pass, I also think that the market overreaction is stupid. So American Express and capital1 falling 8% yesterday. Now on the one hand, I am a big, I am a big efficient markets guy. I really am not in the sense that markets are that the price is always right at every time and not that the market can't get drunk, which I think, I think the market is more drunk than sober right now. I do think there's information in American Express and capital1 falling 8% of the day. But, but I also think it's an overreaction if I'm trying to like thread that needle. So I, I am going to buy Microsoft today. I am running into the fire. That's the only thing I know how to do when I'm scared and maybe I'm early. I'm sure I am. It's okay.

[Ben Carlson]

I bought like an octopus lately. Catching falling knives. You got tentacles everywhere catching knives all over the place.

[Michael Batnik]

I know it's.

[Ben Carlson]

I know I. Daniel, make Michael an octopus for me.

[Michael Batnik]

Please, I know this is. I've said a million times why this is a bad strategy. And please, this is not investment advice. I'm not trying to make you feel better. I'm trying to make me feel better.

[Ben Carlson]

I feel like taking over my mantle here of being the person who's trying to catch the.

[Michael Batnik]

Listen, here's a good thing about, about investing in a brokerage account. You either make money or you make tax losses. Either way, you win. See, that's Michael math. So, all right, these are the stocks that I'm. That I'm. These are the knives I'm catching. I bought Blackstone on Friday. I'm already down 7%. LOL.

[Ben Carlson]

We talk about. We'll get into that later. But all the private market stuff is getting slaughtered because that was part of it too. Private credit is going to get killed in this anyway.

[Michael Batnik]

So Blackstone is in a 43 drawdown. Yeah. I'm comfortable holding this stock. I understand. So here's the thing. Oh, these names are risky. No, this stock is down 43%. Software just had its worst month since October 2008. Don't tell me it's risky. I know. The market knows.

[Ben Carlson]

Instead of buying the individual names, why wouldn't you just buy igv?

[Michael Batnik]

You think there's more money to me because I'm buying. I bought Salesforce and ServiceNow. These stocks are both down. And I'm down 7% on each of these names, by the way. Just full transparency there.

[Ben Carlson]

I want nothing to do with these stocks.

[Michael Batnik]

Fair thing. Listen, maybe, maybe I change my mind next week and say, yeah, I sold it for a 10% loss. ServiceNow is down 57%. Salesforce is down 52%. Those I am definitely not getting married to. But like Netflix. I'm not selling Netflix. I bought Netflix last week. I'm not selling Netflix. I don't care what happens.

[Ben Carlson]

I sold. I sold it a couple weeks ago.

[Michael Batnik]

Okay.

[Ben Carlson]

I feel like. See we've. We've changed spots here.

[Michael Batnik]

That's okay. Listen, I'm changing my mind every. Every other day. S P global. Not scared. I bought CrowdStrike yesterday. This seems like a really, really, really, really stupid overreaction. Like you're companies are gonna clawed away Claude code away their cybersecurity gets out of here.

[Ben Carlson]

That that narrative makes sense.

[Michael Batnik]

And I'm buying Microsoft at the open. If AI is so powerful. I think Microsoft is a buy down 30 something percent.

[Ben Carlson]

It is kind of funny. You can't have these two competing ideas that AI is going to kill the technology industry. But it's also going to be so powerful that, so these tech companies have to be part of this.

[Michael Batnik]

Let's, let's also say that right now, yeah, the market looks abominable. There's no evidence. So this is where I'm taking, I'm going against.

[Ben Carlson]

No, the market looks fine. These stocks look about okay.

[Michael Batnik]

The market from there. I, I, I've always said to people, and this is maybe not, watch what they say. What, watch what they do. I don't know. I'm being a hypocrite. Wait for any evidence that there's a bottom. Wait for a higher low. Wait for the sellers to dry up. The sellers have not dried up. They've got all the ammo. I don't care. I'm running to the fire.

[Ben Carlson]

Here's one thing that I, David Goggins, running an ultra marathon.

[Michael Batnik]

Here's what I take comfort in. There you go. It's not, it's not hard to imagine us laughing about this in six months at all. Think about how fast sentiment changes.

[Ben Carlson]

I think, and I think 2028, they're gonna look back at this piece and go, why did people believe that? I totally, wholeheartedly believe that in 2028, people are gonna look back and go, oh my gosh, how could we be. Of course, of course.

[Michael Batnik]

Think about how fast the narratives changed last year and over the last couple of years. This can, it seems really hard that this is all of a sudden going to dry up because this, this fear that has, that is spreading rapidly. It's, it's, it's Covid, it's a virus.

[Ben Carlson]

Happens.

[Michael Batnik]

We're not going to, we're not going to get vaccinated and all of a sudden like, or, or a magic wand, bing, forget about it. So that's the part that it's like, it is hard to foresee this changing or stopping at a dime, but things change. Narratives change.

[Ben Carlson]

There was a story flying around Twitter yesterday of someone from Meta who put an agent to work and it went through and deleted all of her emails. Even she said, don't do it. There's going to be a story where someone's going to be using this software, they're using cloud or whatever, and it's going to make a mistake and everyone's going to go, oh, it made a huge mistake. I feel way safer in these software stocks now. Like that. That's kind of thing where AI is going to have a mistake. And because of course it's not perfect, that's going to have, I want to talk about one More thing with this article, he talked about how the real estate market is going to get hammered. Right. I actually think that real estate is the best AI hedge that there is. I think the physical world becomes way more important in a digital environment, in a digital world that we're moving into. And I think, especially if you really believe in the AI case, that it's going to be deflationary. Rates are going to fall. Guess what? The government's going to have to print more money. That's the other thing that this piece didn't mention is the fact that there's going to be a fiscal response and a political response. I think in that scenario, I think housing prices are going to be one of the strongest hedges against AI that there is because we're obviously not building more of it. I thought.

[Michael Batnik]

Anyway, I guess what he, what he said, which was like, what happens when the top of the K gets busted and we start seeing mass unemployment and the mortgages are no good? Yeah, that to me was a stretch. Whatever. Listen, it was a good piece. Really well done.

[Ben Carlson]

Obviously, here's the thing for your worry about all the white collar workers getting out of jobs. So he mentions tax client taxes, lawyers. There's gonna be when lawyers don't have to hire paralegals to do all this grunt work and they don't have to be reading all the time, guess what there's gonna be. There's gonna be a million more lawsuits. There's gonna be a million more people that you can do taxes for. There's gonna be more financial advisory clients. There's gonna be more medical testing. Think about if you can use an AI chatbot for customer service. Think about how many more complaints there are going to be. And someone's gonna have to take go up, run up the poll and then take care of those complaints.

[Michael Batnik]

Good take.

[Ben Carlson]

There's going to be more media. There's going to be more work to be done. We're not going to be laying on a hammock doing nothing. People are doing more work with this.

[Michael Batnik]

I completely agree with you on that front. I completely agree. No hedge. Think about what. By the way, you know what's funny? Open I ain't shit. Nobody was worried about chatgpt up the labor market at all.

[Ben Carlson]

You're right. Anthropic is the one that did it.

[Michael Batnik]

That's a lot. Anthropic. Everything with hunky dory. People are laughing at Sam Altman. This thing gets everything wrong. Don't worry about it. Here's the thing comes and then comes

[Ben Carlson]

Daria So last week we talked about how like is a mistake and people are going to hate it. And the media picked up on that narrative really big this week. So Time had this article, the people.

[Michael Batnik]

Wait, hold on. Just. But just before we shift on to this part of it, I just want to stick with the productivity, the work piece of it.

[Ben Carlson]

Okay?

[Michael Batnik]

Think about how much better you're getting at the work that you do as a result of having access to these tools. I feel it. I feel like every time I open these things up and I type something in and I'm talking to it, I feel like I'm getting so much smarter, so much more effective at being able to communicate and understand.

[Ben Carlson]

But are you. But is it making you work less? Are you working any less because of this?

[Michael Batnik]

No, no, no, Exactly.

[Ben Carlson]

Same for me. I'm working more. I'm doing more stuff because of AI. I'm not working less.

[Michael Batnik]

Right. So that's the part of it that gives me hope and excitement. And again, I'm not saying it's all doom. I'm just saying that some of the stuff, like the stuff I said at the top of the show about people that we know that are going to be made obsolete, like, that's. That's so it's.

[Ben Carlson]

It is fair to think that the transition is going to be bumpy. It's just. It's kind of crazy that something like DoorDash and Uber were created and now we have 3 million people doing these jobs, and then you look ahead and you go, oh, my gosh, autonomous vehicles are coming. What are those 2 or 3 million people going to do? But what did they do before? That's like. That's the thing is, like, how dynamic this. But you're right, I totally agree with you that the transition period for millions of people is going to be very painful. And I don't think anyone wants to look at the mirror and go, that's me. Even though a lot of. I think a lot of tech people right now are doing that anyway. Thinking. Thinking through all this doom porn, though. This is why everybody.

[Michael Batnik]

Sorry, I will let you get to this. But that's also what is putting. So that is also why the stock market feels so bummery right now. We'll get to the overall stock market, how well, different parts of it are doing, but that's what can shift. Like the. What would stop the buy the dip mentality. It's like, well, if I'm, like, sort of anxious about my job, I'm probably not psyched to put money to Risk that I might need.

[Ben Carlson]

Yes, right, yeah, People that if it changes people's appetite for risk. And we've kind of wondered like, boy, it seems like this risk on attitude for this decade has just been unstoppable. What could stop that? And maybe AI is that thing. You're right.

[Michael Batnik]

Unreal. Okay, 1, 6, let's get to this cover.

[Ben Carlson]

All right. I totally understand why people hate AI. We sort of planted the seed. Last week, Time did this thing about the people versus AI. It's called like the growing backlash. The New York Times had a piece called People loved the.com boom. The AI boom, not so much. And they interviewed this guy who was a co author of Boom Bust. He said, I can't remember a boom with such active hostility to it. People used to find new technology exciting. It happened with electricity, bicycles, motor cars. There were fears, but also hopes. AI is notable, perhaps unique, for the lack of enthusiasm because duh, hey, do you want a capex bubble or a bunch of job loss? Which one do you want? No one wants either of those things because that's what's being presented to us. And I think the tech people have done a horrible job of telling people why they should want this technology.

[Michael Batnik]

It's just tech people and Blue Owl shared the same PR manager, right?

[Ben Carlson]

Sam Altman needs a new pay and he's not the guy to lead this because he was telling people, listen, yeah, it takes a lot of energy to run AI, but it takes 20 years of life and food before someone gets smart enough to work at a job. This guy, he's not the person to do this. And so, dude, the thing we're learning is that tech people, obviously their intrapersonal skills are not very good. And that's one of the reasons why I think that they're overlooking the fact that the human element of this, because they're not good at being humans, no offense. They're not good at the emotional side. They don't have. They have iq, they don't have eq. There's a lack, a deficiency of EQ among the tech leaders and they don't understand that part of it. And they just assume everyone is going to be a robot and that's not going to happen. But I don't, I totally understand why people hate AI because the way that they're presented is, listen, you, you don't even know what's coming. Just wait. You have no control over this. There's no stopping it. Job loss. And it's like, why would I want this? So my question is, what's the political backlash going to be. We're going to get. If this, all this stuff comes to fruition, we're going to have a socialist president in three years.

[Michael Batnik]

Jamie Dimon was talking yesterday at a, at an investor event, and he was saying, like, for people running companies, if you can eliminate $150,000 jobs and replace them with $20,000 line item expenses, like, are we sure we want to be doing that as business leaders? Like, is that good for society?

[Ben Carlson]

And I hope more CEOs are thinking like that. You're right. Jamie Dimon probably could snap his fingers and replace a lot of the people at JP Morgan with AI but politically, how does that work for him? Financials are a regulated institution. Is the government going to look kindly if you just all of a sudden Let go of 25% of your labor force? No way. So there's going to be other human elements to this, these decisions, like career risk. Right.

[Michael Batnik]

Do we trust government to step in and make good decisions here?

[Ben Carlson]

That's the, that's the problem. Because I think a lot of people think, well, listen, in 2020, we learned the fiscal response when something like this happens, we throw a bunch of money at it and the economy's fine. So if this happens with, I will throw a bunch of money in it. But yeah, you're right. I don't have faith that the government is going to, like, thread this needle. I think they would have to. They'd probably wait for a crisis first and then do something. That's. That's my worry.

[Michael Batnik]

Here's another interesting thing. Somebody tweeted. Who. Who is this? We sort of hit on this last last week. James Wong said, I followed tech for 25 years and I've never felt a larger gap between the million people using Codex Claude and the rest of humanity. And it's like, are they. Are we. Are they gaslighting us? You know what I mean? Like, are we just believing or is the, is the rest of the society just like Walking Dead and they don't even know it yet? I'm sure it's not either. Or it's probably somewhere in the middle, hopefully.

[Ben Carlson]

But don't you think it's possible in the future that people are just gonna be using these tools and they don't know it, it's gonna be part of their life and it's like, oh, that's easy. But they're not gonna, like, celebrate it every day. It's just gonna be slowly ingrained into our lives. I don't. The tech people still want it to Be like, boom. This day. It's like BC and ad, right? I don't think it's gonna be like that.

[Michael Batnik]

Maybe there's a prediction. Will unemployment be over 10% in the next five years?

[Ben Carlson]

I would need a caveat there because it's like, is AI going to cause.

[Michael Batnik]

No, no, no.

[Ben Carlson]

Recession?

[Michael Batnik]

Well, yeah, obviously that's it. Will. Will unemployment be over 10?

[Ben Carlson]

No, but I think some people think that there's going to be a. You're going to get this, this unemployment in this. At the same time the economy's booming. That's what the AI people are trying to tell us. Productivity is going to go through the roof. You're going to get huge unemployment.

[Michael Batnik]

That's a separate. That's part two. Will unemployment hit 10% or higher in the next five years? I would say no. I mean, you're going to need some pretty juicy odds to make me better. Not that I would bet on that, but.

[Ben Carlson]

Right.

[Michael Batnik]

You say no. I say no. All right, let's talk about the stock market. So last week I said, you know what, I'm still bullish. Like the macro. Backtrack.

[Ben Carlson]

Sorry, I'm going to backtrack one more time. So you said you were walking around. I like, try to talk to my wife about this occasionally. And you're right, there's a lot of. There's. What percentage of the population just isn't paying any attention to this? 80.

[Michael Batnik]

No more. Most people have. Yeah, like most people that just aren't online, that just live a normal life, why would they be paying attention?

[Ben Carlson]

And the other thing, I think a lot of people assume Twitter is like this dead place, but Twitter is the reason all this stuff has blown up in the last month. If Twitter didn't exist, this stuff doesn't blow up as much as it used to. So Twitter is still like a market moving mechanism for. Even for warts and all. I feel like they, they try to change something to make me hate it more all the time. Like the way videos play now is way worse. The way you read stuff and links is way worse. But they keep trying to make it worse on purpose if you like. And they can't. They can't make it go away, though. Anyway, let's talk about the stock market.

[Michael Batnik]

Okay. So last week I said, I think this is healthy. Like rebuilding the Wall of Ari is a good thing. You need that. I love that the stock market is that. That stocks are out from the stock market. Like 65% are outperformed the index highest on record or what?

[Ben Carlson]

That's A crazy highest in the last 50 years from Ned Davis. 66% of index constituents are outperforming the S and P itself, which is nuts.

[Michael Batnik]

Yeah.

[Ben Carlson]

Especially since you hear about all these stocks crashing. You would never think that.

[Michael Batnik]

I do love, I do love that. And I'm not going to change my tune there. And the macro backdrop is still good like inflation.

[Ben Carlson]

Okay, consumer, this is what's funny to me about your strategy. Instead of buying, instead of doubling down and buying these areas of the market that are going up, you're trying to buy the ones that are going down. Usually a momentum trader would say, no, no, no, I'm going to keep, I'm going to buy stapled in industrials, materials.

[Michael Batnik]

Okay, we haven't spoken about this and maybe we will at some point, but we have a strategy internally that I put a lot of my money into, into the momentum strategy, so.

[Ben Carlson]

Me too. Because I don't, I don't. I would rather have an algorithm or rules pick my stocks than me. That's why I've decided to, you know this. I sold all my individual stocks like three weeks ago and all I have is this one rules based strategy.

[Michael Batnik]

Well, I, so I told bet I'm done picking individual stocks. I'm just going to, I'm just going to put, I'm just, when I want, when I want to buy size, I'm just going to put it back into whatever strategies we run internally. One of them being a momentum one. And I meant it, I did meet it. And then sometimes opportunity strikes. I didn't think that CrowdStrike was going to fall 15% in two sessions. Like I meant what I said three weeks ago and then the world changed. All right, so, so getting back to like the backdrop, like everything fine, like earnings, revenue, top line growth, multi year high, things are good. The thing that worries me, there's two things. One is the rotation. The, the hard rotation into risk off names out of discretionary and not just the cap weight, but the equal weight basket into staples. That worries me. Seriously.

[Ben Carlson]

So this is more like a late cycle kind of stuff, right?

[Michael Batnik]

Late cycle behavior. And just if the Mag 7 keeps getting killed, like the market can only take so much. So right now Microsoft is down 30%. Apple's fine. Meta's not doing great, Amazon's not doing great, Google's fine. Nvidia reports later this week. Like, I feel like the Mag 7 as a group can't fall 20 without the mark, without it bringing the market down.

[Ben Carlson]

Don't you feel like we're at the point where everyone kind of assumes we deserve to be in a correction right now. Like it should be worse. It should be worse than this. Why isn't it? I think that's what the.

[Michael Batnik]

But why should it be worse? I just said that revenue growth is at an all time as revenue growth is accelerating margins Forward looking.

[Ben Carlson]

In 2028, this market's gonna be on 38, remember?

[Michael Batnik]

Right.

[Ben Carlson]

So might as well, might as well get to getting. Getting there now.

[Michael Batnik]

Yeah. But you know what? For, for all of the anxiety that I'm feeling and I'm sure I'm not alone. Listen, imagine people that like, what if you're a Salesforce employee? What if there's a lot of people probably listening? That works at these companies.

[Ben Carlson]

Yeah.

[Michael Batnik]

Michael. Shut up, asshole. Oh, you don't. Six percent of the salesforce. This is like my life.

[Ben Carlson]

Yes. If your retirement plan was all based on I'm going to get shares in these companies and now my shares are down 60%.

[Michael Batnik]

Devastating.

[Ben Carlson]

Yes, yes, I totally agree. But here's the thing. If we do get an AI induced sell off, if people like start extrapolating and oh my gosh, if this technology is as great as they think it is, I think it's going to be a wonderful buying opportunity. I think every bear market is about wonderful buying opportunity. But I think that if you get a tech induced innovation sell off and as we sort of slowly but surely integrate this into our society, I think that's a fantastic buying opportunity.

[Michael Batnik]

How about this?

[Ben Carlson]

You heard it here first.

[Michael Batnik]

All right? If you've ever said buy when there's blood in the streets, if you've ever used that quote and you're selling here, you're a clown. I'm not saying you have to buy, but if, if you are selling right now, you don't get to quote Warren Buffett ever again. Fair. Okay, so the Mag 7 is in an 11% drawdown. The equal weight index. Let's use the cap weight actually, just for apples. For apples, the cap weight is down 2%. Unbelievable. So I'm not suggesting that the MAG7, which is what, 35 to 40% of the index. I'm not suggesting that 35 is bigger than 65, but I'm just saying if the MAX7 falls 15%, forget about it weighing mathematically on the market. I'm saying the psychology of the market is going to shift.

[Ben Carlson]

I agree. It seems like there's only so long that these stocks can crash without people saying, okay, now I got to sell something else.

[Michael Batnik]

Exactly. That's my take. So if a lot of Fs. A lot of Fs.

[Ben Carlson]

You know what I'm doing? Every month I buy stocks in my. In my ira. Every paycheck, every, every twice a month I buy my 401k. Twice a month I put in my brokerage account. Once a month I put my kids 5 to 9 plan. And AI is not going to cause me to change that ever.

[Michael Batnik]

Yet. Of course. No, of course. Listen, auto buys for the win, always.

[Ben Carlson]

If you really think AI is going to be this disruptive, invest in the stock market. Okay. If profit margins are going through the roof and profits like the stock market is going to be the savior in the future. Okay. I totally disagree with the fact that this is going to cause a stock market collapse. That makes no sense to me at all. Keep going.

[Michael Batnik]

Okay. Oh, this is a good one. All right. For financial advisors, we built a platform called exhibit A. We've spoken about a million times. We do these charts of the week, different charts, upload your logo, your color scheme, blah, blah, blah.

[Ben Carlson]

I'm going to be. I'm. We're working on something. I'm going to be doing some more commentary there.

[Michael Batnik]

Yeah, well, we'll tease that later.

[Ben Carlson]

Yeah.

[Michael Batnik]

All right. There's a great chart that chart. Go created. Chart Kid Matt. That shows the number of 1% up and 1% down days by decade. And the average is 507. We are halfway through the 2000s and we're basically right at the average. This is. Are we going to break the record?

[Ben Carlson]

So this shouldn't happen. And the thing is this shouldn't happen in a bull market. This should happen in a crappy market. Right, Right.

[Michael Batnik]

This is. This is. It's all weird.

[Ben Carlson]

Yes. Anyway, things are just happening way faster these days. The repricing.

[Michael Batnik]

So there was really. Everything is like pretty much in line with like. They all cluster in a pretty tight range as you would expect. Like market like normal markets. The 20. The 2000s was through the roof. Right? Yeah. The dot com bubble and the GFC. So that was 840. But we're on pace to smash that, which is kind of nuts.

[Ben Carlson]

Yeah, it's been a crazy decade. It's only gonna get crazier.

[Michael Batnik]

Yeah.

[Ben Carlson]

These overreactions aren't gonna like just die down all of a sudden.

[Michael Batnik]

You know what?

[Ben Carlson]

Right.

[Michael Batnik]

Can I put in some hedging trades?

[Ben Carlson]

All right.

[Michael Batnik]

I'm buying Microsoft right now.

[Ben Carlson]

So Microsoft, I'm looking at the MAG.7 is down 21% on the year so far.

[Michael Batnik]

Oh, it's what? Down 30% from its high.

[Ben Carlson]

Yeah. So three of the MAG7 are down more than are down double digits this year. That's Tesla, Amazon and Microsoft. They're all down double digits. Microsoft being the worst. All right, Godspeed.

[Michael Batnik]

Listen, if I'm wrong, I'm a big boy. I've lost money before many times. I should say many times have I lost money before.

[Ben Carlson]

That's Brad. But do you think that the Mag 7. So I saw that you have the global breadth chart in here showing that the most number of markets near highs in over 20 years. And this is like the global stock markets. If the Mag 7 and AI takes a bigger tumble here and software stocks continue to get hit, that's not going to impact overseas markets at all, is it? Like that's the. That's the hedge. Isn't.

[Michael Batnik]

Depends how bad it gets. I mean, obviously in a bear market, correlations go to one. So it. It. I guess it. It. If the. No, if the max 7 fall 30%, the rest of the market will tumble too. No.

[Ben Carlson]

Okay, that's. Yeah.

[Michael Batnik]

All right. I am actually buying Microsoft. Bear with me. First time, long time I've done this on. On the show. Locked in. All right, let's move on.

[Ben Carlson]

Market order kind of guy.

[Michael Batnik]

Market order.

[Ben Carlson]

I mean, especially with a stock like that, right? Isn't it a new move to buy in the first half hour of the market? First or last half hour?

[Michael Batnik]

I don't know, man. I'm scared. I'm buying. Okay. All right. This is a good chart. It's so fun. I mean, it's markets, man. Am I right? How much fun? It's unbelievable how I. I know we. We're broken record here. Broken horse, dead horse dead record. Something like Walking Dead.

[Ben Carlson]

Yeah. Beating a dead record.

[Michael Batnik]

Dead Man Walking. Never saw that one. Sean Penn. Sean Penn.

[Ben Carlson]

Not a good hang that movie.

[Michael Batnik]

All right. Of course, coming into 2025, it was like, all right, game on. I'm sure there were many episodes where we said, is it even possible that we avoid an AI bubble? That's how we were talking, right? Like, yeah, probably not. It's probably coming wrong. All right, here's a good one. Steve Dons tweeted. I definitely did not pronounce his name right, but there's a. There's a line, a diagonal line over the E. I don't know which. I don't know what you do. Is that Don say Donzai. Who knows? He has a chart showing global IT sector in the late 90s and the global IT sector today. And the 90s chart shows the price and the earnings. And of course the price diverged bigly from the earnings versus today where the earnings are ahead of the price. Nothing like the 90s, couldn't you see? Nothing.

[Ben Carlson]

We never really. So like we're already separating the wheat from the chaff or we're trying to. And these, these. It feels like people are in the stage of. The surprising thing to me is that where people are more looking for losers than winners. Right. It feels like when this. Usually in innovative bubbles, everyone's looking for winners. This was, it was not like this in the dot com bubble where people are trying to figure out who's the losers going to be. Let's sell those suckers. Right? This is different.

[Michael Batnik]

Like a great use of suckers.

[Ben Carlson]

We never really, we never really got our like blow off bubble here because people are looking for the losers as opposed to the winners

[Michael Batnik]

which by the way, let's assume that, let's assume that we're like somewhat in the vicinity of a bottom. Right. Let's say that the S And P falls 10. I don't know, whatever that, that we don't like the wheels don't come off. As shitty as this feels, I still maintain this is a much better outcome for all of us stock market investors because had it gone, had the S and P gone straight to 8,000, you know it's coming back, you know it would have come back.

[Ben Carlson]

This probably is a better outcome. I agree.

[Michael Batnik]

All right. Oh, speaking of 1999, I haven't told you this. I've been slowly getting back into the Sopranos.

[Ben Carlson]

Okay.

[Michael Batnik]

So we didn't have HBO growing up.

[Ben Carlson]

No, me either. That was a sign of wealth for me when I grew up. If you had hbo, you were a rich kid.

[Michael Batnik]

Yeah. So I definitely felt like from that angle I didn't feel very good about my standing in life.

[Ben Carlson]

It is funny how everyone has every streaming service now. It's seems like it. But back then like HBO was a really big deal if you had it.

[Michael Batnik]

Yeah. So as. However old I was as a 13 year old, you say you're not watching. Surprise. I don't, I don't like it.

[Ben Carlson]

But do you remember when you'd get a free weekend once a year of the Movie Channel? Man. Yeah, that was a great weekend.

[Michael Batnik]

Anyhow, so I'm, I'm, I'm up. I'm on season three and I'm not like plowing through it because I just, I just fall asleep in 20 minutes. But it's the season where Tony and Ralphie are fighting. Anyhow, I was at the dump last week. Guess what's not being disrupted by AI. My dump runs.

[Ben Carlson]

Your favorite place, Gandolfini. That, that's. That's the best TV acting in history though, right? There's no one that has a better performance than him. Maybe, you know,

[Michael Batnik]

so absurd. I can't get used to it.

[Ben Carlson]

Yeah, okay. I, I think it's. He's the best TV character of all time. That's where I landed on Sopranos. There's a lot of really bad acting in that show though. That's the thing that like is kind of hard to. Isn't there? There's a lot of not so great.

[Michael Batnik]

So anyhow, I bring this up because I was at the dump and I saw something that just brought me back to simpler times. A box of DVDs and CDs. And I couldn't.

[Ben Carlson]

Oh, wow. Do you take a look?

[Michael Batnik]

I couldn't help but give one of the, one of these. And so the, the Sopranos was, was on top of the Sopranos DVD was on top. So back in the day, like when I used to live in like in this, in Astoria in Brooklyn, people would leave on the sidewalk a cardboard box of books, CDs, DVDs. And there was just, there's just. That was, that was, that was peak life for me. You would stop, you'd look, what do they got over here?

[Ben Carlson]

I'm glad I never got into the collecting DVDs.

[Michael Batnik]

You. I was obviously one of those maniacs. I would go to Blockbuster, get two for 10. Used to be able to. Or was it two for 20? I, I bought, I spent all my money on DVDs.

[Ben Carlson]

Okay.

[Michael Batnik]

Not a great investment, but good memories.

[Ben Carlson]

What's your retail flow?

[Michael Batnik]

All right, check this out. You mentioned like global breadth, global stock markets. The number of markets overseas near a 52 week high. I'm sorry. More than 2% above their one year peak has jumped to its highest level since 2004. So amidst all of this, global markets are on fire.

[Ben Carlson]

But that's what I was asking.

[Michael Batnik]

So that's why, that's why I say like, I don't know, man. I know I'm. I know I'm flopping around like a dead, like a dead fish. But it is hard to get too bearish when the global markets are like this.

[Ben Carlson]

That's what I mean. The pushback would be. Listen, this is the peak before. Because I'm thinking the S and P is almost at all time highs. Global stock markets are breaking all to all time highs. The economy is still growing. Interest rates are Falling inflation is relatively benign. And the unemployment. And the 4.3% unemployment really hasn't happened yet. So people say, no, no, no. This is. This is the worst before. This is the best before the worst comes. That's. That's the pushback. I don't know. I go back to the Charlie Munger line. Like, if you're not. If you're not confused, you're not paying attention.

[Michael Batnik]

Right now, software stocks are bouncing pretty hard at the open. Salesforce is up 5%. Who knows? Let's see what happens at the close this Friday could easily fizzle, but hit the sell button. Hit the. I'm not selling. I'll sell when I'm down 30% or up 2%. That's it. There's no between. I've got great risk reward here. Okay, this is a good one. Exchange, trade a call. Options are slowing dramatically from retail. Yeah, people are. People are. People are scared.

[Ben Carlson]

Oh, okay. So the. The bullishness, it really, really peaked towards the end of last year, and now people are pulling back. Okay, that's interesting.

[Michael Batnik]

All right, here's a great chart showing why investing is so much fun and so exciting and so frustrating and so maddening, and probably a great chart on why you should just index. But I can't help myself. I mean, I do index. Who am I kidding? But why? I also love that. Love the game. So Netflix, clearly, clearly a global winner, right? It won streaming. Now, of course, it's not. It didn't. It didn't win. It's not the only winner. YouTube, we get it. But Netflix beat Disney. It beat Paramount. It beat prime, it beat Max. Like, it won't even close. Yeah, no, it won. There's no. The battle in the war is over. Netflix is the winner.

[Ben Carlson]

Right?

[Michael Batnik]

Okay. And if I gave you the financials of Netflix and the free cash flow, you'd be like, wow, five years ago, I would have loved to buy that stock. Netflix has underperformed, not just the. Not just the S and P. Netflix has underperformed, let's say the average stock over the last five years. Netflix has underperformed the equal weight. More specifically, Netflix, the biggest winner of one of the biggest categories of the decade, has underperformed the equal weight S, P over the last five years. Why would you ever buy another individual stock ever again? I say to myself as I'm buying another individual stock at the open.

[Ben Carlson]

Do you know how much less brain damage I have now that I don't have to, like, check my app every day to see how my individual stocks are Doing. It's so. It's such a freeing feeling.

[Michael Batnik]

I know. Why am I doing this?

[Ben Carlson]

It's fun. It's a game. It's like, it's entertaining, right? It's. It's part of the game. All right, so I was thinking all, all the crazy stuff we've thought about. This is like in the. When you hear the bad stuff. Excuse me. When. When it doesn't happen, you just kind of move on. Remember how, how long we debated hard landing versus a soft landing? That was the number one debate in finance.

[Michael Batnik]

And then it just went away.

[Ben Carlson]

And then it just went away. Right. And that's. That's what happens with a lot of this stuff. All right, what does Mike Zuccardi have for us this week?

[Michael Batnik]

Okay, let's talk about something fun. Let's talk about how AI is impacting the labor market. All right. Average monthly job growth in AI affected industries over the last three months. So in here is management consulting, graphic design, office administration, telephones, call centers, computer systems, and a bunch of others. And it's just negative.

[Ben Carlson]

This is not AI related, though. The reason this happened is because look at how many more jobs they put on in 2021 and 2022. Over hired.

[Michael Batnik]

True.

[Ben Carlson]

So there's still not an AI story yet.

[Michael Batnik]

Okay. Warren Pius has another chart showing AI exposed versus non exposed payrolls. And I don't know what's exactly in here, but I trust Warren's intuition. Not intuition skills, research skills here. And these charts are diverging bigly.

[Ben Carlson]

This is payrolls. Okay. All right.

[Michael Batnik]

I mean, there's no doubt about it that this is a thing. Right? Like companies are not going to be hiring at the same level as they were.

[Ben Carlson]

I agree. I actually think that if we're going to have this mass unemployment, it's not going to happen on its own. It's going to be. There's going to be fewer job openings. And it would be in the recession scenario. That would be when this really drives into hypergear. Right. Because in recession, people lose their jobs and then they don't get them back. That would be. The fear for me is that I don't think companies are just going to rip the bandit off and just do mass layoffs outside of a recession.

[Michael Batnik]

You know, it's not. American Express is not bouncing today. That's interesting. Let's see what else is going on. Are the asset managers bouncing a little bit.

[Ben Carlson]

All right, so I thought this was interesting. I think this was Goldman Sachs via Samoa at his substack. This is interesting. So. And maybe why A lot of this is just really feels like it's overdone. One nugget buried in the January jobs report was a notable drop in tech employment over the past few months. And the recent disruption in software stocks could foreshadow further pressure down the road. But it is worth keeping in mind that tech employment accounts for only 2.3% of overall payrolls in software publishing for just 0.4%. So as big as tech is in the stock market, as far as the economy goes in the labor market, it's still a tiny, tiny piece of the labor market because guess what, you don't have to hire as many people in tech. We've talked about this. That's one of the reasons it's so profitable and a big profit margin. So just because you're seeing a bunch of software people potentially losing their jobs are laid off, that doesn't mean that it's going to impact the entire labor force yet.

[Michael Batnik]

All right, let me read you some quotes about the economy from the transcript. This is from Thomas Peterfy, CEO of Interactive Brokers. There are two economies in this country. If you listen to the bls, the economy is doing great. If you listen to the big firms that are making huge capital investments, the economy is doing great. If you listen to the newspapers and the television, the economy is doing extremely poorly. So I don't know quite how to interpret that, but I believe the economy is doing great and it will continue to do great.

[Ben Carlson]

Okay, I don't interpret that the media is negative all the time now, right? Everything is bad. That's how you interpret that. Been like that the entire decade for the economy, the economy is. The economy hasn't changed at all really in the past, I don't know, three years.

[Michael Batnik]

You're right. You're right.

[Ben Carlson]

The view of the economy has. Nothing has changed in the economy.

[Michael Batnik]

Walmart CEO. Across our customer base, spending continues to be resilient. In the US we see the customers choiceful in their spending. Okay, Capital One, the one word I would use to describe the consumer these days and everything we Observe@Capital1 is the word stable. Let's just start with the story from a macro point of view. Things, despite all the noise in the economy, things are pretty stable. And lastly, this is my favorite one from Truist Financial CEO. I'm sorry, Senior EVP Consumers beliefs don't match their behaviors. And my dad used to tell me a long time ago, watch what people do more than what they say and you'll learn a lot more. So they're giving surveys or taking surveys. That sentiment may not be as high as we would hope that it would be. But what they're actually doing is totally different. They're spending, they're active. And so that's something that we're seeing.

[Ben Carlson]

You could have said this every year. These quotes could have been read every year since 2022, and it would have been true. It's been the same thing the whole time. This whole economic cycle. It's the same thing. People say they're bearish and they keep spending money and they don't act bearish. All right, let's talk about some funny AI stories. A $7 billion Japanese toilet company just discovered its ceramics tool can be used to make bleeding edge AI chips. That's a $60 billion market. Their stock is up 60% of the news. That's a funny story, right? Okay. Mike Isaac, Amazon's internal AI coding assistant, decided the engineer's existing code is inadequate, so the bot deleted it to start from scratch. That resulted in taking down a part of AWS for 13 hours and was not the first time it happened. And everyone and their brother pointed out this actually was a plot on Silicon Valley. The show, like, the AI bot decided to, like, just delete stuff.

[Michael Batnik]

And I rewatched the first season in the last five years. That show was.

[Ben Carlson]

Mike Judges is a genius. He is such a genius and ahead of his time with office space and idiocracy in Silicon Valley and. But don't you think that's going to be a savior for. I keep saying this top, like, AI is going to start making mistakes. Of course it is. It's gonna do something. And that's when people go, okay, I'm going back in the loving arms of Salesforce or whoever. Like, I can't. I need someone to blame if there's a mistake. I can't have the vibe coding do the mistake for me.

[Michael Batnik]

The push and pull is humans always figure it out. Right? We've always adopted new technologies and like. Yeah, but this technology is different. And

[Ben Carlson]

Michael, people. There literally used to be a job of someone would walk around and light gas lights before electricity was around. People would knock on people's windows because alarm clocks didn't exist. There used to be telephone operators.

[Michael Batnik]

I know, I know there used to be.

[Ben Carlson]

This is not elevator operators. These things all used to exist and they don't exist anymore.

[Michael Batnik]

Yeah, we all know all of this. To me, why that's like, sort of erroneous is because none of the inventions and the new technologies that the place specific industries like the blacksmith for example, it wasn't like a technology that applied, that could be applied to every single sector and industry and job. Like that's the obvious difference.

[Ben Carlson]

But it can't, you're not, you're not going to displace a plumber. The person drywalling is not going to be display.

[Michael Batnik]

I know people.

[Ben Carlson]

The reason this is so scary is because it's coming for white collar workers, because for blue collar workers that took place over 30 or 40 years and you're saying this is happening faster. That's why it's so scary.

[Michael Batnik]

Okay, this is hilarious. Charter has a chart showing the free cash flow that companies burned on their way to profitability. They're looking at Tesla and Netflix and Uber. And just for context, Netflix, which was spending, I remember when they were spending $7 billion on content and people were like up in arms, like this is irresponsible. It's crazy. And it was, it's easy to say now that you know they won, but it really did seem nuts at the time how much money they were spending on content and how much free cash flow they were burning. So Netflix burned $11 billion. Tesla building electric vehicles burned $9 billion. And Uber building out this three sided network build burned $18 billion. OpenAI is telling investors that I think through 2030 they're planning on burning $218 billion.

[Ben Carlson]

So if you could right now, in their public short, open AI and go long, claw, anthropic, would you do it?

[Michael Batnik]

No, because OpenAI would be down 70% and Cloud would be up 40%.

[Ben Carlson]

But wait a minute. Which corporation has the biggest partnership with OpenAI?

[Michael Batnik]

Microsoft.

[Ben Carlson]

What stock did you just buy?

[Michael Batnik]

All right, I just sold it.

[Ben Carlson]

All right. Going down to the ship. All right, so Bitcoin is still just a software stock. The charts line up perfectly. I know, like the analog charts aren't always right, but this is pretty, right?

[Michael Batnik]

It's amazing.

[Ben Carlson]

It's kind of amazing. It's just, it's a software stock, but

[Michael Batnik]

I guess it makes sense. Maybe we're retrofitting the narrative, but it is, it is software. I guess it's code, right?

[Ben Carlson]

I just don't know how this happened with all the things that Bitcoin was supposed to be, how it ended up just being like a software stock. It's really surprising to me with all the stuff that we read about it over the years and all the podcasts and all the think pieces and then it's just, it's a risk on risk off software stock. Maybe that'll change. All right, crazy. Let's talk about real estate. Let's talk about some real stuff. Crazy chart from Mike, by the way.

[Michael Batnik]

Hold on, just one last thing. I know I probably said this already. The everybody back in the boat can happen really fast.

[Ben Carlson]

Oh, yeah, I agree. Yes. Like, well, the deep sea thing lasted a weekend. Remember? This is longer than that.

[Michael Batnik]

Obviously it sounds implausible now given how, you know, whatever. Because it's not. Because it's not going to end. Right. The threat is not going away. It's just a matter of how investors interpret and digest it and react to it, which is, you know.

[Ben Carlson]

All right, Mike Simonson says this just blows me away. He has inventory change from 2019 to 2026 by state. So, for example, Michigan, the inventory is down 40%. Almost. New York is. Is more than that. Texas inventory is up 42%. Florida is higher. A lot of places in the Southeast are higher. This is showing that like the bifurcation we're seeing in the housing market, like it's, it's not a net. It's always been kind of a local market, but I feel like for a few years there it was. What happened nationally impacted the housing market. Now it's totally changing. And the location matters more than anything.

[Michael Batnik]

It's like a buyer's market, but there's no buyers. People still don't want to buy. There's. There's a house. There's a house on my street on the water listed for $1.2 million. And it sounds like an absurd price and it is. It's not a, it's not a big house, but this would have gone in two seconds.

[Ben Carlson]

Right. Because it's on the water.

[Michael Batnik]

And I don't know. I mean, there's just, there's no buyers.

[Ben Carlson]

Yeah. Look at this. In Illinois.

[Michael Batnik]

But isn't 70% did buyers dry up? Like, if you wanted to buy a house, you would have bought a house. That doesn't make sense because there's demographics wise. Or how about this? If you wanted to buy a house and you could have afforded to buy a house, you already did.

[Ben Carlson]

Yeah, there's. I mean, there's still activity, but it's just, it's. It's certainly slowed. Either risk appetite slowed.

[Michael Batnik]

Pending home sales hit like a. All time low. Do you see that chart?

[Ben Carlson]

Modern? Yeah. Not great.

[Michael Batnik]

The company pool. Pool. The ticker is pool. What's the name of that? Company pool. Something they pool Corporation sales. They just reported last week. Sales are down like 1%, I think year over year.

[Ben Carlson]

Well, think about how many pools were pulled forward during the pandemic that would have happened anyway. Yeah.

[Michael Batnik]

All right, well, we'll do Blue Owl real quick if you want to hear a deep dive. I spoke to Brian Moriarty yesterday on the Talking wealth podcast about what happened here. To me, there's this. This is not one story. It's a lot of things happening. I think this is a. This was a pr. Mega, mega, mega fail. Like, mega fail. So the story with these BDCs, these business development corporations think publicly traded private credit, or not even publicly traded. Some are listed, some are not listed. It's private credit. These things first started to go sideways to south when interest rates peaked and started to come down because these are floating rate loans. And they worked really, really well in 2022 because it kept up with. With increasing interest rates. It didn't destroy the price, and there was really very little defaults. So in 2022, this thing was a home run, especially compared to bonds that were down 15. And then money flooded in and there was a lot of questions like, wait a minute, how are you putting the money to work so fast? Like, are there really this many decent loans? What are the underwriting standards look like? And of course, investors, like, this is what we were asking over the last couple years. Like, how would we know? I don't know what you guys are doing. I'm not reading the sub docs. Even if I was, it would be. I wouldn't. It's not my language. So that was the first threat. And then there was the Tricolor first brands, which ironically wasn't even a private credit thing anyway. But it got lumped in with them and I was able to like hand wave away some of the cockroach type stuff. You can't hand wave away the software exposure. BCRED just put out a thing. Blackstone, 26% of their fund is private is software. Like this is. This is a thing. So it's just like a triple whammy of like bad shit.

[Ben Carlson]

And then potential deflation is bad for these funds too.

[Michael Batnik]

That's not great, right?

[Ben Carlson]

So I listened to your talk with Brian. I thought the best point you made was that isn't it weird that this stuff is happening when there's no credit problems like the high yield spread? Spreads are still very tight.

[Michael Batnik]

Yeah, there's no stress yet in the portfolios.

[Ben Carlson]

Yeah, there's no stress in the economy. There's no stress in spreads. And this is already happening.

[Michael Batnik]

Blue Owl stock is down 60%. So I actually listened. I got. I got bumped. I had the phone call to take, but they they did a, they did a call yesterday at 11:30, Blue Owl did. And it's. They just seem to be just deflecting and not taking responsibility and acting like there's nothing to see here. It's just bizarre. And yes, I'm sure that the article in the FT didn't help, but everything's not going great. The stock is down 60%. Okay. So there's obviously like some shit happening that investors don't, don't care.

[Ben Carlson]

No way the CEO survives this knowing nothing else about the company. There's no way to see. There's.

[Michael Batnik]

So, all right.

[Ben Carlson]

The way that they've handled this is. Is awful.

[Michael Batnik]

So I didn't even know. And I follow this pretty closely. Okay? Anytime there's an article about this, I'm all over it. I'm reading the substacks like I'm all over this story. I had no idea that OBDC2, the one that is in the headlines now, that air quote, gated Redemptions, that was always supposed to be a finite fund that always had a 10 year life. Did you know that?

[Ben Carlson]

No.

[Michael Batnik]

Why did it. Why? How did I not know that? That's a huge.

[Ben Carlson]

I don't know, I'm not a big, I'm not a BDC expert over here.

[Michael Batnik]

No, but how did I not know that? I. That's a big part of the story that I only just found out about anyway.

[Ben Carlson]

This is a credit tourist.

[Michael Batnik]

I guess so. I guess so. No, yes, absolutely. Here's the part that I spoke about this with Josh maybe six months ago. You listen to the Blue Owl earnings call and you listen to Mark Rowan at Apollo and Mark Rowan is being very candid about the opportunities and the environment. And Mark Lipschultz is just like. I don't know what he's saying. He said facts matter or you gotta look at the facts, facts do matter. Like eight times on the call. So he was asked about the stock reaction and he said the end of the day stories don't drive results. Results drive results. Oh yeah. And as you can see, we have delivered on every one of our products that absolutely top level performance. Thinking about what we've run at an 8 basis point net net loss rate. And so these facts do matter. What else did he say? I mean, it was just, it was just a lot. He's like, we don't see red flags or yellow flags. We see green flags. Like, it's like, bro, your stock is getting murdered. There are redemptions out the ass. Like it's not all misinformation now. Fine. Maybe some of it the media has taken too far, but just. If I'm a shareholder, I'm losing my mind listening to this guy act like nothing's going on.

[Ben Carlson]

Yeah, that's not great.

[Michael Batnik]

And even on the call yesterday that I was on.

[Ben Carlson]

So you've been, You've been very bullish on the Wealth Channel, getting into this stuff. Do you think this totally slows the pace of this? Right?

[Michael Batnik]

Of course it does. Of course it does. Now, the good news is you're not going to see, like. Like, is private credit going to take down the economy? It's like, listen, there's no rush for the exits. That's sort of part of the point, is that there was an asset liability mismatch here. These loans were illiquid, and investors all want their money back. Like, this is not a great. This is not a great scenario. Do I think that private credit, the asset class is dead? No, of course not. But I think that, like, well, Blue Owl is done. They will not raise another dollar. And these private credit funds.

[Ben Carlson]

How about this? It's probably better that this stuff happen now before the spreads blow out in a recessionary environment hits and people kind of understand, okay, this, because it's. I'm guessing with my experience with, like, credit hedge funds that have shut down in the past that I was involved with in my prior life, it's going to take years to get all these assets back. Years, not months. Years. And you're gonna. These people realize, like, oh, my God. Oh, this is what we own.

[Michael Batnik]

Okay, so. So here's what they did that even when they announced this, I was like, what are you doing? This is so stupid. So they said, okay, you want investors keep asking for 5% of their money back, we're gonna give you 30 of your money back. Take that. How do you like that? See, we're good. We have 30, and we're going to sell for 99.99.7 cents on the dollar. They said yesterday that they were completely surprised by the market's reaction. They thought that would be interpreted positively. And anybody with a brain or common sense, I'm sure these guys know math very well, could have seen. Hey, wait a minute. There's so much smoke. You think that the market will take this at face value? Nothing to see. Everything's fine. See, we just did $1.6 billion with the sales, by the way. Yes. Like, how are flows going to do? So Blackstone, for example, monthly inflows. This is from the Wall Street Journal. Monthly inflows into the largest fund managed by Blackstone dropped to $600 million in January from $1.1 billion in November. So still positive in January. I would be very surprised if they were positive in February, but who knows?

[Ben Carlson]

Yeah.

[Michael Batnik]

Anyway, Blackstone. Yeah, these, these stocks got murdered yesterday. Murdered. There is one substack that I, that I follow called Covenant Light that writes about the stuff. And he said using. This is a bit mathy, so just bear with me for a second. Using OBDCS, that's the publicly traded one, using their 1.19 debt to equity leverage, a 23 discount implies a 10.5% gross markdown on the portfolio. Okay. He said we can further break this down to see what it implies about future defaults. If you assume a 50% loss given default, a 10 and a half portfolio loss implies about 21% cumulative defaults spread over time. That works out to roughly 11% annualized defaults over two years, seven and a half over three years, annualized at four and a half percent over five years. For context, leveraged loan defaults in the worst stretch of the GFC ran at roughly the mid single digits annualized, so 6% from 2008 to 2010. So in other words, here's the TLDR. If you take OBDC's discount literally as a pure credit loss forecast, the market is pricing something like a GFC level or worse. So why am I, like even moderately comfortable catching some of these falling knives? There is a lot of fear out there. And yes, of course it can get worse. There is no valuation support. It's not going to stop. I get all of that. I get all of that. I might lose money on these trades. I probably will, let's be honest. But there is blood in the streets.

[Ben Carlson]

Okay. You've diversified your blood too.

[Michael Batnik]

Very bloody. Very bloody. All right, let's. I want to talk about some of the prediction market stuff from Mike Selig, who's the head of the cftc. But we're going to say this to next week because we're, we're already going very long here. All right, let's talk about movies.

[Ben Carlson]

All right, so Mike Zaccardi gave us a, gave us a chart that shows movies are getting longer. So it shows the average runtime of movies going back to 1980 and in the 1980s, 1990s even, it was right around 100 minutes. A little over 100 minutes.

[Michael Batnik]

That's, that's perfect.

[Ben Carlson]

Which is perfect. Now it's taught we're up at 100150020 minutes. Movies should not be getting longer. There's A lot of movies I watch these days where I go, man, that would have been a great movie if it was 90 minutes instead of 2 hours and 20 minutes.

[Michael Batnik]

I just. I just clowned myself twice. I'm like, you know what? Think back to the 90s movies that were the perfect runtime. Go to. Go to the Rock. Go to Conair. Whoops. Conair. Runtime, two hours, three minutes. Face off, two hours, 19 minutes. The rock, two hours, 15 minutes. All right, maybe not Nicholas Cage movies. What about Demolition Man?

[Ben Carlson]

It was. It was really like the comedy man.

[Michael Batnik]

At hour 55. That's. That's under two hours. Under the. Only you know what needs to be more than two hours? Shawshank Redemption.

[Ben Carlson]

Right.

[Michael Batnik]

And that's about it.

[Ben Carlson]

Yeah, but the comedies and the rom coms and like, that kind of stuff, that can be an hour and a half. We don't need longer movies.

[Michael Batnik]

I took Robert to see Wuthering Heights.

[Ben Carlson]

Yeah.

[Michael Batnik]

Speaking of long movies. So this Emily Bronte, she did Saltburn and what was the other one?

[Ben Carlson]

I never ended. Never subject myself to a Saltburn.

[Michael Batnik]

Not for you. And Promising Young Woman. You saw that one, right?

[Ben Carlson]

Sounds familiar.

[Michael Batnik]

That was with Carey Mulligan.

[Ben Carlson]

Oh, yes. Yes.

[Michael Batnik]

Okay, so Wuthering Heights had a lot of highly anticipated Margot Robbie, Jacob Elordi. It's a. It's a romantic movie. It's a rom com without the comm. Way too long. No nudity. How do you have sex scenes with. With these two people with clothes on? There's, like a lot of sex with cloth. They're wearing cloth or whatever they were wearing.

[Ben Carlson]

People used to wear a lot more layers back then, though.

[Michael Batnik]

This movie, it was. This was like the zebra to the donkey meme for me. I really enjoyed, like, the first. I really enjoyed. I tolerated the first two acts. There was some stuff that I. And then to me, the last. The last act completely fell off the rails. But this was. This. This is 2 hours and 20 minutes. I took Robin to it, and the person next to her. Her entire tub of popcorn fell into Robin's pocketbook.

[Ben Carlson]

So are you watching Love Story with Robin? I mean, you have to. It's a New York. It's the JFK junior Story with Carolyn Bessette. It's on Hulu. It's actually pretty good.

[Michael Batnik]

I think Robin might be watching it. Or she spoke about it. Should I watch it?

[Ben Carlson]

It's like I'm watching it with Courtney and it's. It's. Yes, I'm in. I mean, as a New York person, too. It's all about New York, essentially. And so. And the guy looks. Looks a lot like JFK Jr. They did a really good job getting the guy who looks like him all.

[Michael Batnik]

Anyway, I reject. I don't want to sit in the out. So once it goes like it felt just the last 20 minutes, unless it's like a banger, it just feels way too long.

[Ben Carlson]

Yes.

[Michael Batnik]

I don't want to sit in the movie for 2 hours and 20 minutes ever.

[Ben Carlson]

I agree.

[Michael Batnik]

All right, let's wrap it up. Oh, I really. I think I'm having an impact on the culture. Or maybe I just. Maybe. Maybe I just identified it. I don't want to act like I invented the question mark, but in Miami, Ben and I did a bit about things people say in group settings when you meet somebody. This guy, there he is, here comes trouble. That sort of thing. Like, I feel like that's taken on. I saw you. We saw the Instagram meme of that.

[Ben Carlson]

Oh, yes, right.

[Michael Batnik]

So we got a great email. Don't know whether this is in addition to the this guy lexicon or just a variation. I was sitting at Starbucks next to two well groomed guys in their early 30s. They were talking about buying a local business. Another 30 something prances by my table in sneaker shoes, slim FOs and a three quarter length trench coat because it was raining. He stops, opens his arms and says, look at these guys. I never thought about the plural. The three of them bro hugged and I almost shouted, there he is.

[Ben Carlson]

That's pretty good. That's a thing.

[Michael Batnik]

Great email, right?

[Ben Carlson]

Yep. Okay. Recommendations? Besides Wuthering Heights. So I was a Game of Thrones person from the very first episode. I watched it. I was always a little confused, but I was very entertained. And then when the next Game of Thrones show, the dragon one, came out, I was like, do I need another Game of Thrones show? Like, how many seasons was that? But I watched it and I liked it.

[Michael Batnik]

I love that show. Do you watch it?

[Ben Carlson]

Yeah. So I watch it and I like them both, but it's just like. And then I saw a preview for another new show and I'm like, do I really need another one? And I didn't watch it. And you said a couple weeks ago, hey, give it a try. So we binged it and we watched the whole thing in the last week. And the finale was on this week too. Knight of the Seven Kingdoms. It's my favorite one of the three. It's not the best. It's not the best. It's my favorite because they were half hour Episodes. It had way more humor to it. It had, like, a heart. And it was just like, I could actually understand what was going on. And it's not the best. The other ones are by far better. There's better actors. There's better characters.

[Michael Batnik]

This is a little bit more fun.

[Ben Carlson]

Yeah, it was more fun. And it was my favorite versus the best. I really enjoyed it. I can't believe I liked it so much.

[Michael Batnik]

Can I ask you a question? So I've said this a million times. I stopped watching Game of Thrones in season three because I remember just, like, looking up one time and not knowing a single character. And I was like, why am I watching this? I have no idea what's going on. I have not a goddamn clue what's happening. For the season finale, I. Shame on me. I was on my phone the entire episode, and then the episode just ended. I'm like, wait, did it. What happened? What did I miss at the episode?

[Ben Carlson]

Funny thing is, I don't know what

[Michael Batnik]

it's about my brain in particular with this type of show that, like, I just. And I really enjoyed the first, like, five shows. Cause there was only six episodes. For some reason. I just. My brain has a blockage with this type of show.

[Ben Carlson]

It was a lot. I was thinking, after we finished this, I don't remember how the Game of Thrones show ended. I remember the finale. Remember kind of being underwhelmed. But I don't remember who won. All right. So I finally. I've been working through my action movies I showed because George is such a big action fan. We watched Terminator 2 this weekend for the first time. And, man, I mean, I told him, like, there's. The two greatest action movies of all time are Terminator 2 and Die Hard.

[Michael Batnik]

As far as I'm concerned, Terminator 2 is. It's at the top of the mountain. You can't make a better action movie. Cannot.

[Ben Carlson]

Well, and Kate kind of strolled in halfway through, and she's like, what this? And she just sat transfixed for the rest of the movie. And it really is. And the funny thing is, is you can tell so much of it is just actually done by. Is by real people and stunts. Because you can tell the person on the motorcycle is not really Arnold. It's a guy with a wig. You know when he lands. But George just kept saying. He kept saying, why does this look so real? Because it's not A.I. like, he's like, all the stunts are actually done. He's like, why does this look so real? He kept saying that. And I think they liked it so much because it wasn't just this AI computer driven garbage. And man, that was a movie just. I still remember the thing is to this day, it came out in 1991. It still holds up. You don't look at it and go, oh man, that doesn't hold it. It still holds up.

[Michael Batnik]

I wish Kobe would like watch. That's Kobe. So Kobe's still like a baby. Like he's still like. He watches Diary of a Wimpy Kid all the time. He just hasn't graduated yet. Obviously he will to like grown up movies. Even like moderate like Ace Ventura. Like I don't think he would sit through.

[Ben Carlson]

Oh yeah, that's my daughter. She still likes the movie. Good stuff too. So I decided to watch a movie from 2013 to figure out how the future's gonna play out. So I watched her again, which is a really good movie. We got Joaquin Phoenix. It's amazing how much stuff that show really. But here's a. Here's what's a great optimistic take on AI. Everyone had their own AI system, you know, and they're there and Joaquin Phoenix wrote greeting cards to people and he lived in a sweet apartment. So I think everyone's gonna be fine. Right? But hey, Chris Pratt was in that movie as kind of like the schlubby friend and he was like the schlubby guy in Parks and Rect. He weighed like 300 pounds. Has there ever been a better glow up than him going from like this schlubby dude who was like the sidekick and funny to like the leading man chiseled, you know, I completely.

[Michael Batnik]

I have no memory from being in that movie.

[Ben Carlson]

Yeah, he's like the friend and he's kind of forgettable in it. It's crazy what happened to him. All right, I guess it's on the rewatchables this week, but I watched Crazy Stupid Love again on Netflix just cause it kept feeding it to me on the algorithm. So. All right, fine, I'm gonna watch it again. It's the best rom com cast ever. And I don't think that's even like you can even argue it. Ryan Gosling, Emma Stone, Steve Carell, Julianne Moore, Marisa Tomei and Kevin Bacon. Plus like three that guys, that's the best rom com cast. It's the most like.

[Michael Batnik]

There he is.

[Ben Carlson]

Right? Anyway, I love that Ryan Gosling is so good in that movie.

[Michael Batnik]

I only recently saw that for the first time maybe six months ago. Phenomenal.

[Ben Carlson]

When all the stories come together at the end, that One scene is just movie came in 2011. There's no more spoilers for something that old. All right, what do you got?

[Michael Batnik]

All right. Not to be annoying, but industry is so good. And I know, like, nobody watches it. I think I'm the only person that does. It is. Season four is the best season. It's easily, for me, my favorite show that. I feel like I'm on an island. I feel like nobody else watches it.

[Ben Carlson]

Okay. It was so depraved. Here's my problem with it. I never believed that any of the lead characters were going to be in those jobs. It just. It was too unbelievable for me to grasp.

[Michael Batnik]

It was the first two seasons, they're like trainees in the bank. And then I think. I think they leave in season three, and season four is completely outside of it. Okay, Season four is so good. It's unbelievable, and it is. It is completely depraved. They do not make shows like that.

[Ben Carlson]

That's the problem with me, is that I feel like the depravity, like, that was the stuff with, like, the show Girls. I feel like they did it just to, like, really push buttons. And it's like, it didn't help with the story at all. It was. It was unnecessary. It was gratuitous.

[Michael Batnik]

Don't make me say the Patch Adams line. Patches of Houlihan. Patch Adams. That was Robin Williams.

[Ben Carlson]

All right. I can't believe you're gonna quote Patch Adams.

[Michael Batnik]

Patch Adams. I did like that.

[Ben Carlson]

I cried with, like, the clown nose on. Yeah.

[Michael Batnik]

Rest in peace, Robin Williams.

[Ben Carlson]

Okay.

[Michael Batnik]

All right. And of course, I watched Primate over the weekend. Robin was playing mahjong with her friends. I fired a primate, which is about a chimpanzee that kills its entire family. Great stuff. Really.

[Ben Carlson]

What's it. What, Is mahjong making a thing? Because my wife is playing it now, too. Is it, like, a thing?

[Michael Batnik]

Yeah, yeah, yeah. I thought it was, like, only for older women. Although I guess our wives are getting older. They're not. Not chicks anymore.

[Ben Carlson]

Little.

[Michael Batnik]

Little chicks. I wasn't using the misogynistic. Is that misogynistic? I don't know. Either way, they're not baby birds is what I was trying to say. Don't be mad at me, all right?

[Ben Carlson]

How you feeling? These. How you feeling? Better now after this.

[Michael Batnik]

What's the stock market doing? No, listen, I'll snap out of it. Oh, maybe I won't. I.

[Ben Carlson]

I'm optimistic.

[Michael Batnik]

You know the scene. You know the scene in the Wedding Singer where the. Where the old guy at the bar says to Adam Sandler, I just need somebody to hug me and tell me everything's gonna be okay.

[Ben Carlson]

That's you.

[Michael Batnik]

I feel like. I feel like that guy.

[Ben Carlson]

We human beings have survived and made it through worse than this. That's why. That's what I'm choosing to believe. We're a dynamic species. We're gonna figure it out.

[Michael Batnik]

We've survived worse. Yeah. It's true.

[Ben Carlson]

All right.

[Michael Batnik]

All right. It feels like so much is happening between these episodes. Right. I feel like. I feel like we could do, like, two a week. This feels like pandemic times.

[Ben Carlson]

That was. Yeah. You burned out pretty quickly, though.

[Michael Batnik]

I mean. No, I didn't. We did it for like a year and a half.

[Ben Carlson]

Was it that long? Okay. I thought we were done pretty quick. I don't remember. I. The pandemic is, like, when you have kids, the first three months, you black out. That's the end of the pandemic for me. I. Nothing.

[Michael Batnik]

The only thing I remember from the pandemic, other than drinking every night, which is maybe why I don't remember a lot, is Tiger King and the Last Dance.

[Ben Carlson]

Okay. The Last Dance did get us through. All right, email us animalspiritscompoundnews.com what do we say? Personal emails, personal responses. Thanks to production team filling in for Duncan, who's in Japan this week. Thanks to Daniel and everyone else. All right, see you next time.