The Stock Market Crashed. Now What? (EP.407)

Summary

Animal Spirits Podcast - Episode 407: "The Stock Market Crashed. Now What?" Summary

Introduction

In Episode 407 of the Animal Spirits Podcast, hosted by Michael Batnick and Ben Carlson from The Compound, the duo delves into the dramatic stock market crash triggered by unexpected tariff announcements by the U.S. government. Released on April 9, 2025, this episode provides an in-depth analysis of the economic implications, market reactions, and personal strategies for navigating such turbulent times.

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1. Tariffs and Economic Perspectives

Michael Batnick opens the discussion by highlighting a perspective from Cullen Roush, emphasizing that tariffs have historically been viewed as a nonpartisan economic tool. Roush suggests that while inequality exists and needs addressing, tariffs undermine the economic advantages of free trade.

"[00:56] Michael Batnick: Household net worth at record highs... the average American in the top 10% of global net worth."

Ben Carlson references William Bernstein’s A Splendid Exchange to underscore the positive impact of free trade, noting a significant reduction in household spending on necessities due to cheaper imports.

"[04:48] Ben Carlson: ...households spent 25% of their budget on food in the 1920s, now it's like 10%. Free trade made that possible."

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2. Impact on Businesses and Consumers

The hosts discuss the immediate effects of the new tariffs on businesses, particularly small manufacturers. They cite real-world examples of businesses struggling to absorb increased costs, leading to higher prices for consumers and potential layoffs.

"[22:54] Michael Batnick: ...Lucerne International, another local auto supplier... they have to raise prices due to the new China tariffs."

Ben Carlson shares a poignant anecdote from a listener, Russ Latino, who faces the reality of increased tariffs wreaking havoc on his business contracts and profitability.

"[24:02] Michael Batnick: ...there are millions of Americans that feel this way... but their attitude towards people like us complaining about the stock market, I understand where they're coming from."

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3. Market Reaction and Recession Risks

A significant portion of the episode is dedicated to analyzing the stock market's swift downturn following the tariff announcements. The hosts examine historical data, comparing the current situation to past market crashes, and discuss the probability of an impending recession.

"[07:49] Ben Carlson: A recession is the baseline now. I think it has to be. Baseline is, I mean, I'm, I think it's 75% chance."

Michael references Larry Fink’s remarks about the economy already being in recession, highlighting the sentiment among CEOs and industry leaders.

"[08:23] Michael Batnick: Larry Fink was on stage yesterday and he said that CEOs are telling him that we're already in a recession."

They also explore the psychological aspects of investor behavior during such crises, citing Morgan Housel's insights on market denial and overconfidence.

"[10:50] Ben Carlson: ...if these tariffs are in place as they are, the market could be down 40 to 50%. And I say this without... I really believe this."

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4. Listener Emails and Personal Stories

The episode incorporates emotional narratives from listeners, illustrating the broader societal impact of economic policies. One particularly moving email details an individual's struggle to balance a successful career with personal challenges, reflecting feelings of community decline and economic uncertainty.

"[28:22] Michael Batnick: This person represents millions of Americans... For these people, it really isn't [the economy is fine]."

Ben Carlson adds his reflections on societal changes, such as delayed parenthood and declining fertility rates, linking them to economic pressures.

"[28:51] Ben Carlson: ...what if we would have just had kids when we were like 22. I wonder how many people, young people want to grow up that quickly these days."

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5. Investing Strategies During a Crash

Michael and Ben share their personal investment approaches amidst the market turmoil. They advocate for maintaining disciplined investment plans, such as regular stock purchases, despite the volatility.

"[46:28] Ben Carlson: My whole plan... Every week I buy stocks in my brokerage account. Every month I buy stocks in my SEP. IRA. Every other week I buy stocks in my 401k. I'm not going to change that because of this."

Michael emphasizes the importance of seizing opportunities during downturns, drawing parallels to historical market recoveries.

"[53:02] Ben Carlson: ...stocks are lower. And the thing is, if you're a young person, this is not going to feel like a blessing if we get a complete wipeout in a recession."

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6. Economic Data and Market Behavior

The hosts analyze recent economic indicators, including non-farm payrolls and the Economic Policy Uncertainty Index, to assess the health of the economy and predict future market movements.

"[55:39] Ben Carlson: ...the consumer is not going to get crushed right away by any means. But in terms of valuations for US Stocks, there wasn't a huge margin of safety."

Michael presents historical charts from JP Morgan and other sources to illustrate how the stock market typically reacts ahead of economic downturns, reinforcing the likelihood of a recession.

"[54:28] Ben Carlson: ...the consumer is not going to get crushed right away by any means... But in terms of valuations for US Stocks, there wasn't a huge margin of safety."

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7. Conclusions and Future Outlook

In concluding the episode, Michael and Ben express cautious optimism, acknowledging the severe short-term challenges while maintaining a long-term positive outlook on the stock market's ability to recover. They stress the importance of strategic investing and maintaining confidence amidst economic uncertainties.

"[71:37] Michael Batnick: ...tomorrow might get more painful, but I still believe this is the best way to building wealth. And I don't think that there is anything that could change my mind."

"[72:07] Ben Carlson: ...the stock market could fall 20% in the blink of an eye like that. That's the reason that you get the long term premium, because of the risk there."

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Notable Quotes with Timestamps

• Michael Batnick [02:27]: "We've got 50 pages in the Google Doc. It's got to be approaching the 2020 Covid records in terms of the length of the dock."

• Ben Carlson [10:50]: "If these tariffs are in place as they are laid out right now, the market could be down 40 to 50%. And I say this without... I really believe this."

• Michael Batnick [28:22]: "This person represents millions of Americans. This is not a completely... this is not an outlier."

• Ben Carlson [46:28]: "Every week I buy stocks in my brokerage account. Every month I buy stocks in my SEP. IRA. Every other week I buy stocks in my 401k."

• Michael Batnick [71:37]: "Tomorrow might get more painful, but I still believe this is the best way to building wealth."

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Final Thoughts

Episode 407 of the Animal Spirits Podcast offers a comprehensive examination of the recent stock market crash precipitated by the imposition of new tariffs. Michael Batnick and Ben Carlson adeptly dissect the multifaceted impacts on the economy, businesses, and individual investors, while also addressing the emotional and societal repercussions. Their balanced perspective combines data-driven analysis with personal insights, providing listeners with both understanding and actionable strategies during uncertain financial times.

For more insights and discussions on markets, life, and investing, listeners are encouraged to subscribe to the Animal Spirits Podcast and stay informed every Wednesday morning.

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Disclaimer: All opinions expressed in this summary are derived from the podcast transcript provided and are solely those of the speakers, Michael Batnick and Ben Carlson. This summary is for informational purposes only and should not be relied upon for any investment decisions.

Transcript

[Michael Batnick]

Today's show is brought to you by our sponsors. At Betterment Advisor Solutions, imagining a better future is the first step.

[Ben Carlson]

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[Michael Batnick]

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[Ben Carlson]

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[Michael Batnick]

Learn [e-mail] advisors. Investing involves risk performance not guaranteed. Today's show is also brought to you by Morningstar. Join us, Ben and myself live for a recording of Animal Spirits at the Morningstar Investment Conference at the Navy pier in Chicago, June 25 and June 26. I am excited for that. You know something, Ben? The first time I ever went to Chicago was in 2017 at the Morningstar Conference, and that's where we met Jonathan and Brian, and it was a pivotal moment in the history of Woodhouse Wealth Management.

[Ben Carlson]

Chicago also one of the better summer cities that there is. So this is at the end of June. Have you ever been to Navy Pier before? Mm.

[Michael Batnick]

Mm.

[Ben Carlson]

Okay. Navy Pier is really cool. There's a fun ride there that we should do. I did it with the family. Morningstar Conference is great. It's always a ton of people. A ton of people that you know. I think the first one I went to was like 2012, 2013. And Morningstar tells us it is free to attend for all advisors.

[Michael Batnick]

Okay, so go to our show notes, find the link, register today, and we'll see you in Chicago.

[Ben Carlson]

Welcome to Animal Spirits, a show about markets, life and investing. Join Michael Batnick and Ben Carlson as they talk about what they're reading, writing and watching. All opinions expressed expressed by Michael and Ben are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management. 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.

[Michael Batnick]

Welcome to Animal Spirits with Michael and Ben. It's going to be a long show. We've got 50 pages in the Google Doc. It's got to be approaching the 2020 Covid records in terms of the length of the dock.

[Ben Carlson]

We had a few people ask us if we're going to do an emergency pod. That didn't happen because I'm in spring break. I don't think we would have done one anyway, though, because I think we wanted to let things play out a little bit. Not that they still can't play out more, but where do we begin?

[Michael Batnick]

I always love hearing travel stories. Some observations from the isle, but let's put that to the side. That could wait.

[Ben Carlson]

I. I do have travel stuff, but yeah, let's. I think there's more pressing issues than my, than my takes on cabanas.

[Michael Batnick]

All right, so we're going to start with tariffs. Of course, a lot has changed inside the market in the last week. And we're going to start with some wise words from our friend Cullen Roush. Colin said tariffs are perhaps the most nonpartisan issue in economics. It might be the only thing that Paul Krugman and Milton Freeman agree on. But somehow, some way, the narrative got hijacked in recent years. How did this happen? How did we get to this place where something that was once so universally believed has somehow become controversial? And part of the talking points are fixing some of the problems in America, leveling the playing field inside of our country and with the rest of the world, the global trade. And Cullen says, listen, inequality is real. There are certainly problems in our country that need to be addressed. We can do better. We should do better. But with that context, these are some of the data points. Household net worth at record highs. This is before we blew it up. US households spend less on necessities than ever. This is the surest sign of increasing living standards as our basket of necessities evolves into items that the average American couldn't even fathom 100 years ago.

[Ben Carlson]

So I read this in the. I wrote a post about tariffs and William Bernstein wrote what I think is the best book on trade called A Splendid Exchange. And he says that in the 1920s, households spent 25% of their budget on food and now it's like 10%. And his whole point was, guess what made that number come down? Free trade. Because we get food from other countries and it's cheaper.

[Michael Batnick]

Inflation adjusted median income is up 50% since 1975. The misery index is low by historical standards. Real GDP is at an all time high. The median net worth median of over $200,000 places the average American in the top 10% of global net worth.

[Ben Carlson]

That's a crazy number that our median is top 10%.

[Michael Batnick]

Worldwide, global life expectancy is improving dramatically. Child mortality. Mortality has collapsed. We are experiencing exponential growth and technological advancements. The share of the world living in extreme poverty has collapsed. America owns 33% of all global wealth. When you exclude the UK, France, Germany, Japan, India and China. We own 50% of all global wealth. Yet we've somehow convinced ourselves we're being taken advantage of by the rest of the world and that I encourage people if they want more. From Colin on tariffs, he has a great video explaining in greater detail, is.

[Ben Carlson]

It too far to say, and I know other people have said this, that we got to the point where things are so much better than they were in the past, that we're starting to make up our own problems?

[Michael Batnick]

Yeah, yeah. I think a lot of the chronic complaining and listen, there are problems so it's not like to minimize it.

[Ben Carlson]

But compared to, I think compared to any point in history, we've never lived in a better place than we are in today. And it's like we decided to just throw just eh, fine.

[Michael Batnick]

Well I've made the case that you don't compare yourself to your ancestors, you compare yourself to your neighbors. And when you do that, the situation changes dramatically. I think it was Jonathan Haidt who said this. Maybe it was somebody else complaining. The way that we do is a sign of success. Back in the day, of course there was no Internet, but there was no time for this nonsense. You went to work. So the biggest question that we got in our inbox and we got quite a few this week is bending your brain into a pretzel trying to figure out the motivation. What is the end goal here? What is he doing? What is he. Where are we going with this? Neil Dada from RedMax says bringing, quote, bringing down interest rates to refinance debt. He's playing chess while everyone is playing checkers, end quote. This is a talking point circling around right wing circles. Here's why it is dumb. Recessions are non linear in nature. The risk is always that things can get away from you. Trump's policy, if it is indeed deliberate, is the equivalent of cutting off your nose to spite your face. Will you refinance debt at lower rates? Maybe. Then again unemployment will be higher, which means fewer people will be paying revenues into the treasury. What about households with bank stocks getting destroyed? What makes anyone believe banks are going to go out there and loosen lending standards to help people refinance in the first place? Trump is not, and here's the coup de gras, Trump is not doing this because it is part of some grand plan. The plan is the tariffs. He is doing this because it is what he believes. Trump thinks trade is bad. The market thinks trade is good. I would not expect Trump to be the one to de escalate because he does not believe in trading with other countries. His heart is not in that. It really is that simple. Trump is playing Russian roulette, not chess.

[Ben Carlson]

This is the hardest part about this downturn is that every other downturn in history, or at least in the last 20 years or whatever, you'd think, well, the government is going to come save us. We can throw money at this somehow rates are going to fall, the Fed is going to step in, but the government is causing this. They're causing this crisis. And do you think that a recession is the baseline now? I think it has to be. Baseline is, I mean, I'm, I think it's 75% chance. It's very, very high. And it's that that number shot up in the last month drastically.

[Michael Batnick]

Yeah. So betting markets have it, I think at 60%. I can't remember exactly where, but it's gone on dramatically. Base case is hard because the base is changing every day. Larry Fink was on stage yesterday and he said that CEOs that are telling him that we're already in a recession. And of course we're. What we've learned over the past many years is that there are certainly going to be pockets for recessions as there have been. The real estate market, for example, has been one forever. Whether or not the globe is going to be into a recession, I think it's early to say, but the longer this goes on, sure. The likelier of that happening increases dramatically.

[Ben Carlson]

So this is from Ryan Peterson, who works at Flexport, which is, remember he was a big guy. People were citing during the pandemic because of supply chain stuff. He said 28% of all customers in Flexport's call yesterday said that they're pausing all ocean free freight bookings from Asia until there's more clarity on where tariffs will end up. I think the biggest problem is even if, let's say they say we're going to stop this tariff talk for 90 days like they've been talking about, or we're going to have a deal with every country in the world. Now, even if that happens in the next few days or weeks, I think the confidence is the problem. Where does the market trust him? And business leaders go, wait a minute, we can't trust anything he's going to say now at this point, I think that's the, the confidence and trust part is the one that's gonna be very hard to bring back.

[Michael Batnick]

Okay, but, so let's just say that, that we roll this back he makes a beautiful deal and we sort of move on. And this story is, is, is not over because we're still going to see the ramifications of this. But do you think that, that people are going to. And businesses are going to say, all right, we've got another three and a half years, we're just gonna coast until he's out of office? I don't believe that. I don't think people need confidence in his policies. I think they just need him to remove the uncertainty.

[Ben Carlson]

Yeah. And I don't know if we're gonna get that. That's a problem. This is how crazy thing is, Dan Ives is bearish. Dan Ives put out this week. He said Trump tariff Armageddon will take us world back a decade. China wins. He said if US tech companies are faced with this reality, saying if Trump everything he laid out in that Rose Garden ceremony or whatever, it will negatively change the tech landscape for decades to come. The cost structure of the US tech world would make it impossible to compete with China. And this would be a lotto ticket for the China tech landscape. Byd, Hawaii, Alibaba Tencent and thousands of other Chinese tech players to gain more global market share over the years. And he goes through all the stuff that he's been talking. He travels the globe, he talks to tech suppliers. I've never seen Dan Ives like this before. Obviously.

[Michael Batnick]

I've obviously been wrong on what he was going to do. I still don't believe it. Maybe I'm. I'm the idiot here, but I still believe that.

[Ben Carlson]

I think we have to. The door has been beaten down at this point. And I think that that's what the market hope is and that is what worries me. So this is from Morgan Housel says, I spoke to an investor who said if the market actually processes what happened yesterday, and he wrote this on Thursday, obviously it would be down 30 to 40%. The fact that it's not is either denial or belief that it will soon be reversed. And I totally agree with this. If, if these tariffs are in place as they are laid out right now, the market could be down 40 to 50%. And I say this without. This is not. I'm not a scare person. I actually believe this.

[Michael Batnick]

I believe that too. I just. What I don't believe is that the tariffs as proposed are going to stay on. That's the part that I don't believe.

[Ben Carlson]

Yeah, I sure hope. Yeah. Because again, it would nuke. There's no way businesses could operate. There'd be so many businesses that would be completely Shut down. So here's the people who are trying to wrap their heads around, why is he doing this? Here's my analogy. This is the Luka Doncic trade to the Lakers. So everyone says, okay, set aside the fact that this was one of the worst trades of all time. And it's funny that trade is in both of these, right? The Luka for Anthony Davis is probably the worst trade in sports history. For what you're giving up and what you're getting, set that aside. The way that they executed the trade was almost as bad as the trade itself. And that's what's going. So that's the same thing that's happening with this. If people looked at these rates, these tariff rates that he created in all these different countries, and he did it on, it seems like every country in the world almost. And people eventually figured out, like, wait, how did he calculate this? And people looked at the calculation and it was basically like a fourth grader put it into ChatGPT and said, and there was this formula. And people said, even if this formula made sense, he did the formula wrong. And so that's the thing. Let's say you really believed that you want to ensure everything and that tariffs are a good idea. History shows, and logic shows tariffs are not a good idea. But let's set that aside. Let's say they are a good idea. The way that you do this, would you not say, listen, we're going to give you three years to get your act together and reshore as much as you can, and if you don't bring back a certain amount of. And we're going to incentivize you if you reshore everything, we're going to, we're not going to tax you or something. We're going to, we're going to give you incentives to do this instead of just laying these tariffs on. He could have said, we're going to give you three years to get your act together. Even then it probably is impossible. But. So, like, I feel like if he really believed this, he didn't. He gave it, he didn't give it a chance to succeed.

[Michael Batnick]

From the start, the execution was terrible. Unless his strategy, and this strikes me as ridiculous, but let's go so far over the top just to bring them to the negotiating table. People are saying that this is like as big a deal as the Bretton woods, that it is going to reshape the future of global trade and the global economy. Maybe I'm in denial. I just, I think that the megatrends that are in place. I think that if you look at, if you go back, if we're 10 years from here, I don't know that this is going to be looked back upon as a watershed moment in global capitalism or global trade.

[Ben Carlson]

It's hard to say again, because the trust and the confidence thing, if all these other countries say screw you, we're like, if, you know, China and South Korea and.

[Michael Batnick]

Yeah, but we're the world's biggest customer, and so we have the leverage and he knows it.

[Ben Carlson]

I agree. It's also a thing where, wait a minute, he's a lame duck president. We're going to, in 24 months, we're going to be getting new candidates who are going to be throwing their head in the ring to be president. Could we ride this out for 24, 36 months? I guess that is the thought process, too. The funny thing is we do keep getting emails from people and comments from people saying, this is all political for you guys. And the only people that say that are obviously. Yes. The only people that say that are obviously they're being political. Right. But so I am. I think you and I could probably count on one hand the number of times we've had an actual political conversation. You and I are not politics people. Right. We would rather if we never had to deal with politics. We know we have to.

[Michael Batnick]

The only time you and I have ever discussed politics off, off of the camera is through the lens of the market. Never asked you. That's not our thing.

[Ben Carlson]

So I'm going to give a very nonpartisan political take because I never give political takes. So here's my. Here's my political takes. I think the last two years have cemented the fact for me that we need to have age limits on the presidency because the Democrats screwed this up by Biden not leaving. And guess what? Trump is almost 80 years old.

[Michael Batnick]

Yeah. If that makes us ageless, I'll sign up for that.

[Ben Carlson]

Yes. I should have limits on that. And also, here's my other thing. If we, Because I feel like we have one party who is completely inept and doesn't get anything done, and we have one party who is just completely insane and does crazy things. So why don't we have a third party? Why don't we have someone come in and say, I don't like what these people are doing and I don't like what these people are doing. Let's do it a different way. Why don't we get that? Where is that? Probably never going to happen, I suppose. But those are my political thoughts.

[Michael Batnick]

All Right, let's move back to like, how did we get here and what in the hell is going on? By the way, this morning? There's some faction in the party now that Elon's the party. Well, I guess actually is. And what are you talking about? Elon called Peter Navarro, who is spearheading, who is like the, the microphone for Trump. He called him Peter Ricardo. Is that what he called him?

[Ben Carlson]

That sounds all right. So this is from the Washington Post over the weekend as Elon Musk launched into a barrage of social media posts criticizing one of the lead White House advisors for President Donald Trump. That's Navarro. His aggressive tariff plan. Musk was going over that same official head and making personal appeals to Trump. So this is the thing a lot of people said, well, if Elon Musk is going to be the. And I think this is what a lot of tech people thought when they backed Trump. If Elon Musk is going to be the de facto president, then that's who we're backing. It's not really Trump, it's Musk. And it is kind of scary that he's listening to this Navarro guy as opposed to Musk.

[Michael Batnick]

Okay. But I would disagree. I don't think so. My friend was like, doesn't he have advisors? Like, how. Who. What's going on? Who is, who's advising him? I said, no, no, no. I mean, yes, technically, but he's. They're not advising him.

[Ben Carlson]

Right. He's got yes. Around him saying, this is, yeah, great job, sir.

[Michael Batnick]

He's not doing what Navarro says.

[Ben Carlson]

Navaro, you did awesome.

[Michael Batnick]

Yeah. Matt Klein said, like all sharp budget tightenings, this will reduce living standards. And these tax increases are targeted such that the poor will suffer disproportionately. The tax increases are also sufficiently complex and arbitrary that they will create substantial costs for businesses, reducing productivity and exacerbating the direct hit to income.

[Ben Carlson]

Yeah. So he's saying tariffs are taxes, which it really is a tax. So he's saying it's like an equivalent of a 2% tax increase. And to some people, well, that doesn't sound like very much. But his point is this is going to hit the poor much harder than the rich.

[Michael Batnick]

Of course.

[Ben Carlson]

Yeah. So Jeremy Siegel said on CNBC, I think this is the biggest policy mistake in 95 years. So that gets back to the Great Depression thing. And I think that is, that is completely true. I totally agree with that. This is like the biggest own goal. And it's also. So I did a history thing where I looked at. There was Remember, Michael Semblance did this thing of the 1890 tariffs, and then there's the 1930s tariffs, and the world is more global than those times even. It was bad back then, but doing it now is even 10 times worse because of how interconnected everything is.

[Michael Batnick]

Yeah, it's surreal. Like just, just watching the screen these last couple of days and not just the market, but like, well, who am I cutting the market? It's hard to understand.

[Ben Carlson]

Here's my feeling, though, because a lot of people are thinking like, oh, boohoo, the rich people are going to lose money in their stocks. The stock market is frontal.

[Michael Batnick]

The rich people. Most people in America Getting more than 50% Own the stock. Own stocks.

[Ben Carlson]

60% of people own stocks. The homeownership rate in this country is 65%. Guess what? The majority of people own financial assets in the United States, even if the rich disproportionately own it. The other thing is, I keep thinking, I told this to you the other day. I'm in Florida for spring break and people are. The restaurants are full, people are spending money. And I feel like one of those people in a climate change movie, you know, where like the world is going to end and you're running around telling people like, do you people not realize what's coming? Because if we keep these on, guess what? It's not going to be the stock market. It's going to be the economy. And that's going to be more painful. The market will eventually, like, the market has been through more than this. Stock market will come back. But the pain that could be causing the economy from this, that is going to hit people beyond their portfolios. And that's what I'm worried about.

[Michael Batnick]

Right. So there's obviously been a political divide in the country. The haves, the have nots, the hollowing out of the middle class, as I like to say, the destruction of the manufacturing class. There was an op ed in the Wall Street Journal from Norbert Michel from the Cato Institute, which is not a liberal think tank, it's a conservative think tank. Right. Okay. He said populists such as Vice President J.D. vance argue that free trade agreements cause middle class wages to fall, hollowing out towns across America. Yet the only way to make this argument is to cherry pick the data to death. The US middle class has thrived over the past 40 years. In fact, Americans of all economic backgrounds have done well. The share of households earning more than $100,000 has tripled over the past five decades. And the share earning less than $35,000 fell by 25%. For most of this period, workers in the bottom 10% of income distribution experienced stronger wage growth than those with higher incomes. The middle class has shrunk only in the sense that former middle income earners have moved up the income ladder materially. Americans are much better off than they were in 1970. Over the past 40 years, 70% of working age Americans spent at least one year among the top 20% of income earners. I'm going to repeat that. Over the past 40 years, 70% of working age Americans spent at least one year among the top 20% of income earners. And 80% never spent more than two consecutive years in the bottom 10%. So he says it's true.

[Ben Carlson]

Those are really good numbers. I never heard that before.

[Michael Batnick]

It's true that the number of manufacturing jobs is lower than it was in 1970, but that's because we can make so much more with fewer people. And one of the things that that is always cited is NAFTA and the wto. And look what happened afterwards. Armand Domolewski tweeted, I am so tired of posting this chart and it's the manufacturing share of US employment with 1993 NAFTA passes on it. But the thing is it's been crashing since the 40s. It has been only going one way. And if you look at JP Morgan as a chart showing Germany as well, their manufacturing share of employment now significantly higher than ours, but it's going down because technological process progress, excuse me.

[Ben Carlson]

And we have more service jobs in this country. If you look at manufacturing versus service jobs, service jobs are the opposite.

[Michael Batnick]

It goes straight, shows that straight up into the right. And so this idea that the world has taken advantage of us and we're like boo hoo, it's just a complete joke. There's a chart from Bloomberg that shows US GDP per capita continues to grow at an accelerating pace. We are the envy of the world. So let's talk about the other side. The people that are supportive of these tariffs. The people that feel like they are getting left behind because I don't want to dismiss those feelings. They're real and they're legitimate. Everybody's life is personal, right? Like you live your own life. And so I totally get people's point of view that are feeling that way.

[Ben Carlson]

So Michigan is a perfect example of this because so I lived in the Detroit area for a few years and it's funny because if you drove like a foreign car in the Detroit area, like people would look at you side eyed like you, everyone knew someone who could get an employee discount at Ford or gm. So everyone, you know, luckily I was driving a Ford Taurus back then, so I, I fit in nicely. But obviously there was talk all the time of, of why can't we just have these people who could graduate high school and go get a factory job and, and live a middle class lifestyle and look what happened to the, the car manufacturers because they gave these unbelievable pension medical benefits. They almost went bankrupt. GM did go bankrupt. I guess it was just an unsustainable period and I think we'll probably never see anything like that again. That just didn't make any sense. And I understand people like, wish it would be that easy. And unfortunately it's just, it's not that that world is gone.

[Michael Batnick]

Correct. All right, so there was an article in the Journal talking about the title was the First Victim of Trump's Trade War is Michigan's Economy. Mary Book Zeiger, CEO of Lucerne International, another local auto supplier, is also talking with customers about her need to raise prices because of the new China tariffs. About 80% of the automotive hinges brackets and other components Lucerne says on made in China. She said, quote, there is no way we can absorb these tariffs. I don't have 20% margin to give. She, she, she's the owner of the company with 25 people.

[Ben Carlson]

And I'm sure that they look at this and they say, okay, great, will pass along that higher cost to customers, but our customers can all of a sudden go, wait, okay, you're making us pay 20%. We had an email from someone saying the manufacturing of his small business product is going to be, the tariffs will be in the 40 to 50% range. And he said, if they go through, I'm done. I don't have a business anymore. It's completely nuked. And there's going to be so many cases like that where, and obviously I think we heard an email from someone who said like, I'm actually on the winning end of this for whatever because of steel or something. But he, he even said, I'm sure I'm going to be in the minority of this.

[Michael Batnick]

So it's strong feelings on both sides. Like there are, there are a lot of people cheering this on and I want to give some examples of that. So I saw a thread from Russ Latino. He tweeted, I just got off the phone with a business owner in Mississippi. He's pumped millions into a business distributing a product he imports from China. His contract with the company prevents him from manufacturing in the U.S. he also contracts with A number of large retailers. He describes some of these contracts as inflexible, requiring him to sell a unit at a set price. He told me he anticipates paying over $1 million in tariffs next week and has no ability to simply upcharge his retail customers to cover the expense. In his words, Russ, I don't have 54% profit. This puts me out of business stuff. I share this because there are probably tens of thousands of businesses in similar situations. I. I just happened to have one reach out to me. So here are some of the replies and some of the dialogue back and forth. And this went viral and toxic and blew up. And somebody said, okay, well, maybe it's best you don't make a contract like that. I'm just a simple guy, but I would have never made a contract locking myself in. There's always a chance something like this could happen, and there should have been provisions on the contract, period. This is simply making this political. To which Russ replied, no doubt you're a titan of international industry and are speaking authoritatively from a position of experience. There was another reply. There are countless businesses like this. They will all need to relearn the basic principles of free market economics. I mean, come on and move manufacturing back to the US and that's a good thing. To which Russ replied, nothing screams free markets. Like, you just have to do that here if you want to be in business. Somebody said, if your business relies on exploiting Americans, we're happy to shut it down. Russ replied, his business literally saves American lives.

[Ben Carlson]

This is, this is the hypocrisy that gets me is the people who have been screaming for years about government manipulation and the government needs to get out of markets for free markets now want to see tariffs and price controls. This is literally controlling markets. And Colin's point from last week was this is going to drive prices up, not only because of tariffs, but because it's going to reduce competition and give the businesses that win have more pricing power and they essentially turn into a monopoly. And so that way you get lower quality goods for higher prices. The opposite of what you want, obviously.

[Michael Batnick]

All right, I'm going to read an email that was kind of long, but I thought it was just really emblematic of the type of frustrations that people in this country are legitimately experiencing. To my favorite weekly podcast hosts, thank you. Your podcast brings up a survey a lot. It's a repeated survey whose conclusions are something like, my personal situation is good, but the whole economy other than me seems to be very bad. It's always come across to me the same as it comes across to you. People are just listening to too much doomer media and things are actually pretty good. I have an econ degree from whatever and until very recently was a disciple concerning tariffs being bad. This despite growing up and returning to living in the Quad Cities, an area that has been truly devastated by factory moves in the past, I still believe in the comparative advantage stuff. Something clicked with me today. While thinking of all this tariff news. Everyone in positions like yours are absolutely livid or freaking out. It seems like something seriously bad can come of this. It's frightening, but like what are we defending here? I've got a good job. I'm the survey respondent that says I'm doing well. I am doing well. We make a lot more than the local average. But I didn't start trying to have kids until I was 35. I saw these plan closures when I was a kid. I still remember my father pulling me aside and telling me that I absolutely needed a degree in this info economy. I couldn't repeat his mistakes. So I did. I joined the Air Force to afford school. I worked hard to get a decent job out of school. I focused early on my career. The American Dream, baby Ivy grad finance job. And then I was 35 and I just started having kids. I'm 39 now and having kids is tough. But I have one drive to my to work with my wife, which is nice. We drop off the kid at daycare along the way and then I pick him up from daycare, return to my empty neighborhood bereft of kids maybe. Probably just like your neighborhood. Our community doesn't have its own little league anymore. I honestly don't know how to reliably get my kid playmates. What are we doing here? In the 1970s, before shopping containers, we all had cars, a house, food, some form of tv. And we had kids. People graduate, get a job that paid enough to have some form of life and of kids in their early twenties. In this information economy it is really hard to have kids early. And I need a bit more animal spirits myself because let me tell you, it isn't easy having kids late and my neighborhood is empty. Everyone says the person on the other end of the survey that they are doing fine, but their neighborhood is empty too. Anyway, thanks for all you guys do so I I can't empathize with this or I can't relate to this because my neighborhood is the opposite of empty.

[Ben Carlson]

Yeah, so is mine. We have a ton of kids, but I get the Whole thing behind thinking in the past, people having kids, because that's a, that's a real concern is the fertility rate is dropping and people aren't having as many kids. I also wonder though, would young. So my wife and I had kids when we were I, I was 32, I guess 32, 33. And I think about, what if we would have just had kids when we were like 22. I enjoyed having that extra buffer period to enjoy my life. I wonder how many people, young people want to grow up that quickly these days.

[Michael Batnick]

Yeah, no, I, I think, I just think it's the, it's an affordability issue. So I, I don't think we're arguing whether it's good to have kids at 22 or 39, but I think it's.

[Ben Carlson]

Also a maturity issue. In the past, people had to grow up and be more mature way earlier. And we, I don't think we, I don't think our young people are mature enough. Deaf kids these days that.

[Michael Batnick]

So here, here's my takeaway from this email. This person represents millions of Americans.

[Ben Carlson]

Right.

[Michael Batnick]

This is not a completely, this is not a total outlier.

[Ben Carlson]

However, people, everyone's people have seen, especially in the Midwest, towns that have been howled out, that once were manufacturing hubs that are not anymore. That's a, that's a real thing.

[Michael Batnick]

Yeah. So if you are this type of person who lives in this type of America, of course you feel this way. It doesn't mean that it's representative of the economy. It doesn't mean that the economy isn't working. But for this, for these people, it really isn't. And so I could cite Colin's data points and I am on the side that like, tariffs are not the answer to this. Right. Which is a separate conversation. So there are millions of Americans that feel this way, but their attitude towards people like us complaining about the stock market, I understand where they're coming from.

[Ben Carlson]

Right.

[Michael Batnick]

How could you not? I don't agree with their solutions, obviously, but I understand, I understand why they feel, how they feel.

[Ben Carlson]

Frederick Lewis Allen had that great book, only Yesterday that talks chronicles the Roaring twenties and then the aftermath. And he talks about the Roaring twenties were this unbelievable time in America. Obviously the war was over, the Spanish flu was over. People decided we're gonna spend money, have fun. But he also showed, remember back in the 1800s, 85% of the country worked on a farm. And he said the 1920s, that was when people started going to manufacturing jobs for the first time. And he said that farmers of America got Absolutely crushed. As people went from working on farms to working in manufacturing. In that period of transition, the farmers were like, to them it felt like a depression. But to everyone else it felt like the biggest boom time in history. And now we're.

[Michael Batnick]

That's capitalism. That's progress. And unfortunately people are left behind.

[Ben Carlson]

Yes, unfortunately, that is kind of what happens. And I think.

[Michael Batnick]

And so it's weird to scream at these people, you're wrong because. What do you mean? They're wrong about their, about their own situation.

[Ben Carlson]

Right. But the whole AI robotics thing is not going to make. This is not going to lead to more manufacturing jobs.

[Michael Batnick]

We're not going backwards. We're not going backwards. And so, so this idea that we're somehow getting ripped off to the bereft, that's not a. I didn't use that word. Right.

[Ben Carlson]

A for effort.

[Michael Batnick]

Thank you. That the rest of the world is ripping us off. Not even close. Geez. So somebody posted a chart. The US the United States renamed for countries with similar GDPs. And this goes back to 2019. But nevertheless, California does as much GDP as India. Texas as Brazil. Hong Kong, Illinois. I'm sorry, Netherlands. I always get Illinois and Indiana backwards.

[Ben Carlson]

So New York has. New York is Canada, Michigan is Belgium. So the point is that like we.

[Michael Batnick]

Are, we are the richest nation in the world by any metric. And this idea that they're taking advantage, the rest of the world is taking advantage of. And listen, I'm not going to pretend to be like a international cross border economists. I don't know the details of how all this works and I'm sure there are things that are. I'm sure there are areas in which it's unfair and we are getting ripped off.

[Ben Carlson]

Can we just, can we discuss though too, there's the economic impact of this? Obviously. Can we discuss how the Internet has brought us to this place too?

[Michael Batnick]

Yeah.

[Ben Carlson]

This does not happen without social media and the Internet.

[Michael Batnick]

Of course.

[Ben Carlson]

Right. It feels like we are being run in some ways by commenters on Twitter.

[Michael Batnick]

Yeah, it does. Because it's true.

[Ben Carlson]

And the hard thing is when you have a post that sort of blows up. I had to mute a lot of conversations on Twitter. I'm not gonna l through this the last couple weeks. This is probably about as angry as I've been about a bear market usually. I kind of like, you know, I think this is the dumbest bear market of all time.

[Michael Batnick]

Yeah.

[Ben Carlson]

And if we go into recession, it'll be the dumbest recession of all time. And so I was putting some tweets out there and I was venting and the comments I get, it's hard to tell the difference between a bot that's programmed to think a certain way and the way that some people are replying because they just, you know exactly what they're going to say.

[Michael Batnick]

Yeah. If tariffs are so bad, how come other countries do it?

[Ben Carlson]

I think we've lost the ability to think critically. And that is a thing that worries me that this is not just a one time shot across the bottle. This is something that is so. And this is something that I want to talk to. We're going to talk to Derek Thompson about his new book in a couple weeks and I think one of the things I like about the book, I don't know if you've read it yet, is that it's an optimistic book, it's not a pessimistic book. And my biggest worry, and I want to ask him about this, do we as a society have the ability to back an optimistic message like that? And I don't think we do anymore.

[Michael Batnick]

I disagree.

[Ben Carlson]

I hope, I hope we do.

[Michael Batnick]

I'm worried that we don't getting back to the execution of these ideas. So some of the towns that have been hollowed out and some of the, some of the areas where we're vulnerable that we have no production, that we're just reliant on China for whatever. I think most reasonable people would agree that we do need to protect national security interests.

[Ben Carlson]

Right.

[Michael Batnick]

That that should be like a bipartisan agreement. Like yeah, some of the stuff needs to get fixed. Then do it that way. Like let's be a little bit more targeted. These blanket tariffs on everyone, everywhere. This is not the way to do it.

[Ben Carlson]

No. If it wouldn't actually been targeted, that would have made sense to me. Listen, we're not going to let China rip off our technology anymore. We're going to produce chips here. That sort of stuff would have made sense. The way that we're doing it now, everyone's just going to end up paying higher prices and businesses are going to be hurt. And guess what happens? Businesses are going to protect their margins and that means they're going to cut costs. And what does that mean? Layoffs are coming. There's going to be a ton of layoffs coming in the months ahead.

[Michael Batnick]

We'll see.

[Ben Carlson]

Oh no way. I almost can guarantee this. We're going to see a lot of layoffs because of this. Probably companies are not going to eat their margin. Let's but these ether margins.

[Michael Batnick]

What if they just make stuff with shittier products? Like, are we going to wear Nikes and they're just going to explode after the whole stitches are going to fall apart.

[Ben Carlson]

Well, I tell you what, maybe we need to start making fishing poles in America again, because I bought like five fishing poles already on our trip and every time I do, they break.

[Michael Batnick]

Car dealership guy tweeted. Mercedes Benz to, quote, protect the price of its vehicles in the month of April. Parts pricing for customers will also remain unchanged through April. Incentives and discounts continue to be defined monthly and remain available. Standby to standby.

[Ben Carlson]

So I just saw a commercial down here for like a Tomiami Ford or however you say that word, like they were having a pre tariff sale. Buy your car now before the tariffs hit. You know what else is going to happen too is used car prices are going to skyrocket. So maybe you can actually sell your Jeep for more than it's worth.

[Michael Batnick]

But so what about this? We're going to see. We're going to see a lot of unusual data, people buying before tariffs, and there's going to be a surge in the hard data and Trump's going to declare victory.

[Ben Carlson]

It's possible. We see that. It's also. We're also.

[Michael Batnick]

No, there will be funky data in the next month or two, probably. As people get ahead of this, it is going to be weird. Somebody emailed us, guys, last week, our team at a bank was debating what's the opposite of animal spirits where we came into the year with. And they landed a sober resignation.

[Ben Carlson]

Oh, that's pretty good.

[Michael Batnick]

I don't know that one.

[Ben Carlson]

All right, I like silver resignation.

[Michael Batnick]

All right, last thing before we get to the market's reaction. We got small business optimism this morning. Mike Zuccardi tweets that the index fell 3.3 points to 97, its lowest level since October 2024 and its largest decline since June 2022, down three months in a row. I guess this is the thing. Like the. The Ron Burgundy. I don't believe you again, maybe I'm just a complete idiot, but I don't believe him. I don't believe. Because if I'm wrong and these are not a negotiating tactic, which I think they are, and these policies go through. Ben, I do agree with you that we will be down another 40% from these levels.

[Ben Carlson]

So I made this point in a blog post. You remember the old story from Art Cashin during the Cuban Missile crisis, how he talked to the old trader and he said, we have to sell everything now. There's going to be a potential nuclear war and the Old trader said, no, no, no, no, no. When the missiles are flying, you buy. Because guess what? If the missiles actually come and hit our shore, it's not going to matter what you own anyway because the market won't be open anymore. But if the missiles don't come and you buy, you, you're going to look a genius. And that, it does seem like that last week your whole point was a binary outcome. It feels like that because again, if these tariffs are implemented as he laid them out in that stupid sheet of paper that he's holding, if they're laid out like that, the market is going to be down 30, 40, 50%. And I, again, I don't say that lightly, but that I really believe this.

[Michael Batnick]

Yeah, so do I. For the record.

[Ben Carlson]

Okay, so do you think So I got, I got a flashback to 2008 on Sunday night when the. Sunday night. So Thursday down 5%, Friday down 6%. When futures opened down 5 or 6% Sunday night. That reminded me of 2008 because every time over the weekend something really bad would happen and futures would get slaughtered. So I looked at this. The two days in the two days, Thursday and Friday, the Dow was down 9% S&P was down 11, Nasdaq was down 11, Amazon was down 13%, JP Morgan was down 15, Nvidia down 15, Apple was down 16 and Boeing was down 19 in two days. It was pretty close to a Black Monday ish for two days, which is just nuts.

[Michael Batnick]

Yeah, market did not like that.

[Ben Carlson]

Joel Weisenthalt said this is the 11th worst three day performance of all time. And if you look at this list, it's recessions, 1929, World War II, depression. It's the worst of the worst essentially.

[Michael Batnick]

This is a great looking chart from Luke Stein. I've never seen data displayed this way. We just finished the 10th worst week for the S&P 500 down 9% 10th worst week since 1940. You ever see it laid out this way?

[Ben Carlson]

No. It would take me a really long time to learn how to do this on Excel though.

[Michael Batnick]

I feel like no idea. All right, so we got, we got where, where do we go here? Let's start here.

[Ben Carlson]

So wait, let me, let me just lay out like where I was at on Thursday and Friday. So Thursday the day after, remember we were all watching the futures market because he did the announcement at 4pm or whatever. And the futures market originally, by the.

[Michael Batnick]

Way, it was weird because we rallied pretty hard into Liberation Day.

[Ben Carlson]

Yes. Because people are trading on rumors and who knows? And Thursday starts off and the stock market is shellacked and then it keeps going down and down and down. And we flew out for spring break at like 1:30. So I'm watching the markets on my phone all day, seeing what's going on, what are the announcements. And I'm taking off for spring break. And then the next day, Friday, we get into Florida the next day. We had planned to go to a water park on Friday. We bought the tickets ahead of time. And I'm watching the market just melt down in real time and the stock market goes down 6%. One of the worst days, I mean, since 2020, but one of the worst days of all time. What was, I don't know what it. Where it hid in the hierarchy, but probably one of the, what, 25 worst days of all time, something like that.

[Michael Batnick]

It was bad.

[Ben Carlson]

And so we go to a water park and I had fun at the water park all day with the kids and rode a bunch of rides. You know those water park, those water slides where you, you go down the water slide, straight down, and at the very beginning you feel like you come like six inches off the water slide, like you're floating in midair. Have you ever done one of those before? And you come down, then you scream at the bottom and it just gives you a huge wedgie, right? We had one of those slides and we did it a bunch. My kids loved it. And that's what the stock market felt like that day. But here's the thing that I realized. Me sitting in front of the computer screen was not going to make the sell off any better. I almost felt guilty that I wasn't sitting in front of my screen all day watching. But I also thought, what good would that do to sit and watch the stock market get hammered all day? It's not like I could put my hands in a steering wheel and control it any better. I couldn't make it go up. So not being in front of the screen and watching was actually a freeing feeling because there was nothing I could do. And my whole thinking was, life goes on.

[Michael Batnick]

It does, right?

[Ben Carlson]

You can't let like a couple bad days in the stock market throw you off from doing what you were doing anyway. Although I'm sure you were in front of the screen all day.

[Michael Batnick]

I was. I sure was.

[Ben Carlson]

Are you trying to push it higher on your own?

[Michael Batnick]

I was doing some buying. I'll get to that in a minute. Bill Ackman tweeted, if you haven't noticed by now, I speak the truth, regardless of the consequences to me personally or what Other people think somebody responded, good job speaking out. But it seems like you should have foreseen the chaos. Your anger toward Dems clouded your judgment in my opinion. Amman tweeted back, I have no anger toward Dems, just disappointment. This is the part that I want to italicize and bold. I don't think this was foreseeable. I assumed economic rationality would be paramount. My bad. And that's where I was.

[Ben Carlson]

That's a lot of people obviously that's.

[Michael Batnick]

That's where I was. I.

[Ben Carlson]

No one possibly could have assumed the president is going to crash the market like this on purpose.

[Michael Batnick]

Especially the pro business president. The guy who all he does his first administration is tweet about the stock market and, and any down day in Biden's administration tweet about how Biden should be impeached because the Dow is down or whatever. So the analogy that I gave was there's a red button on his desk that said push to destroy the economy and he pushed it. I just, I couldn't believe that he would do that. And so that is still where I'm at. I still think that this is negotiated negotiation executed terribly. Tom. Tom Lee tweeted. Or Tom Lee was on TV saying we want to. And credit to Tom for doing this. We got it wrong. We want to apologize. As the terms of Tariff Liberation Day were far worse than we expected. The resulting market fury is not due to a reaction to a trade war, but rather the fact that the White House broke a core covenant of capitalism. So Tom Lee owning up. Myself and Bill Ackman I think is representative of a lot of people on Wall street. Felt. And then yesterday.

[Ben Carlson]

I love that you just put yourself in with Tom Lee and Bill Ackman. Yeah, me, Tom, Bill, Bill, here's the thing. There aren't enough rich people who will say, you know what? Hand up. I was wrong. And I think a lot of it. I think a lot of people say, oh thanks. A little. Little too late for you, Ackman. I think that's a lot of people think. But like at least you're saying like I will. And again, I think a lot of people should just say I thought we were getting deregulation and lower taxes. Right. I didn't sign up for this.

[Michael Batnick]

Yeah, it's okay. Listen. Wrong all the time. Publicly wrong. It happens.

[Ben Carlson]

Yes.

[Michael Batnick]

Nbd. So I did write this in the doc and I had to delete a lot of the stuff that was in the doc because it aged so quickly so poorly or so poorly so quickly. One of the things that I wrote was this was, I guess over the weekend, I'm a little bit nervous that I wasn't nervous. I wasn't feeling any sort of panic whatsoever. Sunday night I felt it. I felt the feelings of like, okay, okay.

[Ben Carlson]

Sunday felt like the ship was going down a little bit.

[Michael Batnick]

Yeah. Sunday night, futures open down whatever, I don't know, 4%, 5% at its worst. We finished green on Monday. But what was interesting on Monday was Walter Bloomberg, who we've been talking about, but I think he made the joke. Is this a robot? Like literally, is it?

[Ben Carlson]

Pretty sure he's an AI.

[Michael Batnick]

Walter Bloomberg at Delta One tweeted Hasset quote, Trump is considering a 90 day pause in Tas. And we had the craziest intraday volatility I've ever personally seen in my career. It was up 7%. The Nasdaq was in like 20 minutes, then gave it all the way back and then it finished up on the day. But I think the fact that the market isn't down a lot more and the fact that you get this sort of rally on any type of news reaffirms my position that if we do get a resolution that the market will scream higher. I don't know, man.

[Ben Carlson]

We were down almost. We were down 20% in like. Like that. You don't think that was scary enough?

[Michael Batnick]

What do you mean?

[Ben Carlson]

You just said that the market you. That the market isn't down more. The market went down very fast. If you look at a drawdown chart of the S and P, it looks like it fell off.

[Michael Batnick]

Yeah, yeah. Trung fan. This is fantastic. You see this meme? It's Walter and it's Walter and Jesse from Breaking Bad sitting at the diner. And Jesse says, you follow Walter Bloomberg, huh? So there's this anonymous X account, Walter Bloomberg, Swiss dude, but his real name isn't Walter and he doesn't work for Bloomberg. Weird. He takes paywalled financial news and pops it to 850,000 people on his feed. This morning he said Trump was going to delay tariffs by 90 days. Markets ripped added one to $2 trillion in minutes. Turns out it was fake news markets dumped again. He misheard a CNBC Q and A with a White House official. Then CNBC published a story with him as a source, which he then sourced as his source. He people wondering if he could do it again and trade on it would be insane. Anyway, far coin is up somehow 100% since Liberation Day. Walter says, Jesse, what the are you talking about?

[Ben Carlson]

Wait, Walter Bloomberg is from Switzerland?

[Michael Batnick]

Okay, so all right. A core tenant that I have when investing. And I can't help it, I'm proud of it. It's what I do. I have to do when the market crashes, when the market panics, I buy. I have to.

[Ben Carlson]

When the market's around, the market's around 5% in a day. I was buying on Thursday and Friday, as bad as it felt I was too. And those maybe turn out to be way early. And it felt like it after the fact because again, I still think the prospect of like a 30% crash in total is still very much on the table.

[Michael Batnick]

Agreed.

[Ben Carlson]

But what else are you supposed to do, right?

[Michael Batnick]

So Pierce Crosby tweeted US Economic Policy Uncertainty Index and obviously spiked, basically highs on record. Then he shows S&P 500 returns a year after the spike. And not a perfect track record.0108. We were down more a year later. But a lot of people and I don't know if this has me nervous, Listen, this muscle memory, it's going to take a while to unwind. Bank of America tweeted. I didn't tweet this. Somebody else tweeted it. Client US equity inflows were the fourth largest in our data history since 2008. Baltunas tweeted VO took in $4 billion yesterday. We're recording this on Tuesday, by the way, its biggest inflow in about three years. So people are at least retailers buying. And we asked like, what would. What would have to happen for this to reverse for the buy the dip the every two weeks, like for there to not be some sort of. And I don't know if it puts a floor underneath the market. I don't see how you could say that because we could still go a lot lower. Just the fact that people are for 1K. But Jeffrey Patak, we asked, like, what? Well, what do people do in 2022? And there were outflows, mutual funds, as there always are. And the outflows from mutual funds exceeded the inflow into ETFs. But the VO's of the world, they bought them.

[Ben Carlson]

Yeah. So that's the thing. My whole plan, I was kind of laying it out in a blog post. Every week I buy stocks in my brokerage account. Every month I buy stocks in my SEP. IRA. Every other week I buy stocks in my 401k. I'm not going to change that because of this. If anything, it makes me feel better making those purchases because stocks are lower. And the thing is, if you're a young person, this is not going to feel like a blessing if we get a complete wipeout in a recession. We've said you don't cheer for a recession. You don't want to play that game again. That's Russian roulette, where if you lose your job, who cares how low stock prices are, or if home prices come down, or if interest rates come down, but the fact that stock prices are 15, 20% off their highs and for individual stocks, in some cases it's more like 40, 50, 60%. You know, you still think of this as a good thing and you don't try to overthink it.

[Michael Batnick]

Okay, here's the thing though.

[Ben Carlson]

Here's my worry is interest rates began to creep up again yesterday. That is a big problem. If we do get a spike in inflation and rates go up and the Fed says we can't cut rates like this, that's where this thing is. Not just like one or two announcements and everything's back to normal. This is, this is, this is where this turns into a multi year kind of thing and trust is broken and then we see a sideways bear market for three years. And that is the thing that breaks some people's backs.

[Michael Batnick]

Totally possible. Sentiment Trader tweeted the S&P 500 after the Vix hits a high of over 45 for the first time in a month.

[Ben Carlson]

See, I feel like you and I have switched roles here. Usually in the downturns, you're the one who's not panicking, but you're feeling bearish. I feel like we've switched roles where I've felt very bearish and I'm not trying to take a victory out for last week, but what I felt, what I worried about was actually what happened and I think it might even worse than I thought.

[Michael Batnick]

Yeah. So again, I'm a little bit nervous that I'm still not nervous, but when Vic's over 45. So basically this looks at panic and generally speaking, so two months later, it's higher 67% of the time. So certainly not always three months later it's higher 83% of the time. Six months, 92%, 12 months, 82%. So those are the odds. Okay. Like this goes back to 1990. Those are the odds. Positive 82% of the time after, after a panic, not 100%. There's, there's no such thing as a certainty with investing. Subo Trade tweeted what happens to the S&P 500 after two consecutive days of negative 4% declines?

[Ben Carlson]

And obviously doesn't happen very often.

[Michael Batnick]

No. Six months later it was negative. So there's like n equals whatever. 11 here, maybe positive later. 90 of the time. 6 months. 80 a year later.

[Ben Carlson]

Look at those 1929 ones. It happened three consecutive weeks in the 1920s.

[Michael Batnick]

So, and this is not to make fun, we got a lot of people sending this to us. This has nothing to do with Matthew Shaughnessy. So I'm not dunking on somebody that's not a financial expert. I'm just, and I'm not dumping on the Wall Street Journal.

[Ben Carlson]

Know that people know that we like these stories.

[Michael Batnick]

It's just funny that the Wall Street Journal does this. Whatever. Can't help it. Tickles my funny bone. I'm just sending out as much cash as possible, said Matthew Shaughnessy, who runs an auto repair shop and pet spa in Idaho. If I try to catch this falling knife, I'm just going to get cut over and over and over on the way down. The 43 year old said he holds his shares in Rivian and Roblox in the days he sold. I'm sorry, he sold the shares in Rivian and Roblox in the days leading to Trump's Rose Garden tariff announcement. He still owns shares of Novo Nordisk and he has some $10,000 in cash in a brokerage account. Shaughnessy said he doesn't plan to buy any more stocks until the market carnage subsides. I don't know why this is necessary. Again, no disrespect to Matthew Shaughnessy whatsoever.

[Ben Carlson]

It's just he's waiting for the dust to clear. Right?

[Michael Batnick]

Okay. So this morning Trump tweeted or he socialed or I don't know what they're calling it. I just had a great call with the acting presidents of South Korea. We talked about their tremendous and unsustainable surplus. We are likewise dealing with many other countries. He says China also wants to make a deal badly, but they don't know how to get it started. We are waiting for their call. It will happen. God bless the usa. He's negotiating. As far as, as far as I'm.

[Ben Carlson]

Concerned, I hope so, because if he's not, then things are going to keep getting worse.

[Michael Batnick]

All right, so, so, so is it, is it premature to buy? Should you wait for the dust to settle? Here's how I see things and why. And this is, this is not blanket advice. You do what you want to do. Right? There's not like there are many different personality types. That's what you have to understand when, when you're listening to different people. My personality, my investing personality may be 180 degrees different than yours. It's fine. There are many different ways to do this for me. For me I buy panic because I know that if we, if we get the bounce and roll over then there will be a point in time where I'm too scared to buy. So I'd rather like just buy before that point happens. Okay?

[Ben Carlson]

I always buy too early as well.

[Michael Batnick]

So, so here's, so here's, here's the thinking. You might be like Michael, how, how dumb are you? You're buying stocks. We haven't even. We're day four. The tariffs. It's not even April 9th. What are you doing, you dumb bald asshole? Just. Can you. Can we just see how this shakes out? Here's the problem. The market doesn't wait. The market.

[Ben Carlson]

Obviously the market didn't. The market didn't even wait it. I wonder how surprised they were in the White House to see the market just get completely slaughtered. And back to the thing of the stock market not caring what you say. You can tell the stock market all you want that these are going to be wonderful beautiful policies. It does not care. So here's the thing to your point about being early in the stock market moving way faster than ever before. We could see the stock market rallying in the face of a recession big time.

[Michael Batnick]

100%.

[Ben Carlson]

The recession might get here 612 months whenever it happens. If he keeps going down this road.

[Michael Batnick]

In the stock market, just think about 2020. Remember when we made all time highs later in the year? And you're like you're telling me that stock XYZ is better today than it was in 2019. How does that make any sense? And people, myself included, it didn't make any sense to me. But that's how the market behaves. It bottoms way in advance of the things turning. So we have this chart from JP Morgan that I suspect will be shown for a long time. And it shows the course of. It's from semblance. The S&P 500 earnings, payrolls, GDP. The market on average bottoms five months before GDP troughs. So the news will continue to get worse and worse and worse. And the market will stop going down. You say what? Why isn't the market going down? Because it already went down. It already went down. Apple fell. How much Apple fall 30%. Nvidia was down 40% in like a couple of weeks. It already did it. So we have this great chart from chart goat Matt chart can Matt showing since 1957 all of the bear markets and there was 11 of them. The stock market bottoms on average nine months before earnings bottom. So on the one hand I understand how it feels way premature because this shit could get way worse. But that doesn't mean that the markets could be like, all right, guys, come on in. We're all clear. We're just going to, we're just going to stop going down and we're going to late. We're going to let everybody back in, everybody come back in before we rally. It doesn't work like that.

[Ben Carlson]

Yeah. The stock market bottom in 2009 in March. And the unemployment rate went up all the way through October till it finally peaked in October, which was whatever, seven months later. The thing is, the stock market moves so much faster than it did in all these periods too. So this is looking at all these different periods in the 50s and 70s and 80s and even the early 2000s, the great financial crisis. The market moves way faster now than it did back then.

[Michael Batnick]

Yes. All right, let's just talk about some economic data real quick because people are waiting for the hard data to fall off a cliff. And we got non farm payrolls data last week. Significantly better than expected.

[Ben Carlson]

Yeah, the market obviously eating. Don't you think though that at this point you cut it off and whatever has just happened in the past 612 months for the economy, it doesn't matter anymore. I don't think it does. I think you have to start new and we have to see what happens from here. This is, this is a total pivot point. A. This is a before and after.

[Michael Batnick]

I agree. I do, I do agree. So while I, while I don't think that we're going to look back on 2025 as like a global inflection point before and after. I could be wrong. I do agree that the data will, the data will continue to soften as a result of the lack of confidence.

[Ben Carlson]

But what if we, what if we do look at this as a global inflection point? What does that.

[Michael Batnick]

Well then, then, then it's good. Then it's really bad.

[Ben Carlson]

For everyone or just for us? Because I don't, I don't know.

[Michael Batnick]

How could the rest of the world do. Bet do great if we're, if the, if the largest consumer in the world is sucking wind, I don't see how that's possible. We are the global importer.

[Ben Carlson]

It's true. I, that's the thing that concerns me though. What if this, what if in a small way things are just different and you know, like if, if you're, come.

[Michael Batnick]

On, you, you think, you think I don't Know. You think we're gonna let that happen?

[Ben Carlson]

I sure hope not.

[Michael Batnick]

Do you really think we're let that happen?

[Ben Carlson]

I do think that if we had a 40% stock market crash and the economy went into recession because of these.

[Michael Batnick]

Idiotic policies, these people are gonna be like rats in a sinking ship.

[Ben Carlson]

Yeah, I do agree with that. Eventually. I can't believe Congress hasn't stepped in to try to take these powers away from him yet. Like, grandpa, give us the keys. You don't drive anymore.

[Michael Batnick]

Ben, what you just mentioned, the way that you just said, like, that's generally how the market behaves, the stock market investors tend to expect the worst, and the worst doesn't usually come to pass. Now, again, I could hear somebody saying, michael, we're flat year over year. What are you talking about? This has even started. I get it, I get it. Unemployment rate still pretty low. Creeping a little bit higher, but still low. All right, Anything else?

[Ben Carlson]

That's what makes this so infuriating is that he inherited a pretty darn good economy with low inflation, low unemployment rate, and he's just going to blow it up for no good reason. That's the problem that I think so many finance people are just ripping their hair out right now going, what are you doing? Why are you focusing on this? You focus on 100 other different things. Why this?

[Michael Batnick]

And again, this idea that it only. That this is going to only hurt rich people is so foolish. It is so foolish.

[Ben Carlson]

Yes. Guess who will be able to weather the storm? Rich people. They'll be fine.

[Michael Batnick]

Okay, one thing on AI I thought was kind of cool. And this is a plug for exhibit A. So Michael Kitz has put on the Advisor tech. Put exhibit A on the Advisor technology heat map, or I don't want to call it a heat map. And I uploaded this onto ChatGPT and I said, put a circle around a red circle around or a red square around Exhibit A. And it did it, but it changed like a lot of the images, which is weird, but back in the day you would have to like, use snip, maybe paste it to a spreadsheet. Like hit the square button, remove the. The. The shading or the. The color, and it did it for you.

[Ben Carlson]

Okay, let's talk about crypto real quick. We haven't talked much about that, so it was very bizarre. I think you even sent me a message or me and Josh being like, crypto is holding up really, really well right now. And last week as that was on.

[Michael Batnick]

That was on Friday.

[Ben Carlson]

Yes, I think Friday bitcoin held up Pretty good. It might even have risen a little bit as the stock market is crashing. It seemed weird. And then over the weekend, one of the Winklevoss twins said, look at Bitcoin is finally decoupling from Risk Assets. And almost to the minute after he tweeted that crypto, Chris, Crypto just completely crashed. So. But why was it for that one day, why was crypto still doing okay? I mean, there must have been slow.

[Michael Batnick]

I don't, I have no idea. This, this is. So this Tweet from, from Punk9059 says this chart looks at S&P 500 daily returns versus Bitcoin over the past 15 months. And he said pretty much every day the S and p was down 2%. Bitcoin was also in negative territory. So I don't know. I can't tell you why it was, it was, it was an outlier, certainly is not holding up.

[Ben Carlson]

But then it, then it played catch up over the weekend and now. Do you think that's why futures were down so much too? Because it was following crypto's lead?

[Michael Batnick]

I don't know.

[Ben Carlson]

Okay.

[Michael Batnick]

I mean, I think apps and crypto futures would have still been down quite a bit. Anything else you have to say about the market? Listen, I'm, I'm not, I'm still not naive to the risks. Right. Like if this is not a negotiation and the tariffs are the point, then, then lower we go. I'll, I'll believe it when I say it.

[Ben Carlson]

I am still a long term optimist and again, I think the stock market eventually will be just fine. My biggest worry is that there wasn't a huge margin of safety coming into this in terms of them. I mean, the consumer balance sheets, there is. So I think that the consumer is not going to get crushed right away by any means. But in terms of valuations for US Stocks, there wasn't a huge margin of safety. That's the. I suppose that's the concern. Is that just the valuation premium? If that compresses along with the earnings, that's, that's the. Okay, this isn't going to be very fun. We shall see. All right, I have some travel thoughts. Airplane first. This happened to me the last two times I've flown the rush the aisle people right when you land because they either have. They want to get off the plane or because they think they have. And it's just like when you cut someone off in traffic to get in and you give them the wave, like just say something, hey, I really have to catch my flight. But the People, they run up and then they pretend they look ahead like you're not there. And I just want to be.

[Michael Batnick]

Nothing grinds my gears more than somebody who. Who cuts in front of you to, like, as you're pulling into a red light. It's. It's the rudest.

[Ben Carlson]

Yes. All I want is a. Hey, I really have to. Do you mind if I just go real quick? Because I really have to catch a flight or I have to get off the plane, but the people that, like.

[Michael Batnick]

Like, run ahead four seats and then just get stuck. It's like, what are you doing?

[Ben Carlson]

Literally, you're gonna make it off 60 seconds earlier. All right, cabanas are out of control. We got to put a stop to this. There's. There's way too much cabana. So the first we got into town, we couldn't get in our house until Saturday. So we stayed in a. In a hotel. And by the pool, there's all these cabanas. And then the next day we go to the water park, there's all these cabanas. You have to pay to run them, obviously. I know that there's some places that are these really, really nice cabanas, and they have, like, TVs and air misters and stuff, and you pay like, $600. And it's really nice. But these are like, we're talking like Bed, Bath and Beyond cabanas. You know, all it is is shade and two lounge chairs, and they're charging, I don't know, 150, $200 just to get some shade. It's too much.

[Michael Batnick]

Why does that bother you? Seems like a weird nit to pick.

[Ben Carlson]

When did we start charging people for shade in the sun? When you were growing up, did they ever rent out cabanas? I feel like this is a new thing. It's just a new way to rip people off.

[Michael Batnick]

Shade is a scarce resource.

[Ben Carlson]

I just think these cabanas aren't even nice, right? And then you look at them, and most of the time they're all empty and just sitting there. No one's using them.

[Michael Batnick]

Yeah, well, the nice cabanas are really nice. And those are way more than 200.

[Ben Carlson]

Yeah, they're really expensive. I had a sentimental moment with my kids the other day. So I. I'm still the entertainment dad where I have to. Hey, dad, you got to come in the pool, though. Hey, dad, you gotta ride the bikes with. My kids do stuff on their own sometimes, so they still want me to, like, be their entertainment. And I have to play games and throw balls. And sometimes I kind of like, can I just sit here and not do this? But I think I'm going to really miss it when it's gone. The day that they stop asking me to do stuff and not be the entertainment dad anymore. That's going to be painful. I'm already feeling it. I was in the moment playing with my kid. I throw the ball and they jump in or we play paddleboard or whatever. I'm really going to feel it when they don't want me to do that anymore.

[Michael Batnick]

I'm the opposite. And I think I wish I was more like you in that sense. My kids are very self sufficient in terms of entertaining themselves. Sure, they want me to come in the pool and the lazy women stuff, and I do, but. But they are not reliant on me to entertain them. And I don't know that I'm going to miss that part of it. Maybe I'm wrong. Maybe I will. Time will tell.

[Ben Carlson]

All right, so for some reason, the laptop. I'm doing this from an Airbnb in Marco island and the camera on my laptop for some reason has never worked. We've had the tech people on our team look at it, the production people. No one can figure out how to get the camera to work on my laptop.

[Michael Batnick]

And where was your laptop made? China.

[Ben Carlson]

Seriously. And it's never worked. I can't. I can't figure it out. And I got down here and I realized yesterday I don't have a camera to do the podcast. And I ordered a podcast or I ordered a camera on Amazon at 6pm yesterday. It was here by 4am this morning. That is a benefit.

[Michael Batnick]

Who says we don't have it? Good.

[Ben Carlson]

Right? Another one. A lot of. I got a lot of emails about the Canadian geese from people.

[Michael Batnick]

Holy moly. Did we get a lot of emails?

[Ben Carlson]

Lot of them. My favorite ones were the fact that a lot of people call them cobra chickens. That is a great nickname for Canadian geese.

[Michael Batnick]

Yeah, it's good.

[Ben Carlson]

I like the cobra chickens. Yes.

[Michael Batnick]

Did you see this, Ben? Somebody tweeted you're hearing the first howl of a direwarf dire wolf. Excuse me. In over 10,000 years, back from extinction.

[Ben Carlson]

I saw the story on the news this morning about it.

[Michael Batnick]

Using ancient DNA from fossils up to 72,000 years old, colossal reconstructed a full genome through precise CRISPR edits and brought the species to life. Holy moly. That's kind of neat.

[Ben Carlson]

They interviewed the scientist and she's like, this isn't Jurassic Park. And she kind of gave a nervous laugh like, this is Jurassic Park. What are you talking about?

[Michael Batnick]

Yeah, I'm here for giant wolves. What are we going to do with them?

[Ben Carlson]

It's like it. It's like the big wolf on Game of Thrones. They're going to protect blind kids.

[Michael Batnick]

Quick plug for future proof. Leaders retreat, May 12 through May 15 at the Broadmoor in Colorado Springs. The Broadmore is a gorgeous hotel. There will be no booths, no. No overcrowded panels or anything like that. These are Wealth Management, CEO, CIO, CTOs, COOs, CMOs, industry executives from asset management, fintech financial services. One of the great things about this event, in contrast with all the others, is it's much smaller and more intimate. I think last year there was not. I think I know there was less than a thousand people there. I don't want to give an exact number because I'm not quite sure. But the experience as an attendee last year was different in the sense that it was much more intimate and there's a lot of people that came that. The feedback I got, and I totally. I totally get this was, listen, I wanted to hang out with you guys. I didn't want to be one of 4,000 people. So sign up. May 12, May 15, Colorado Springs.

[Ben Carlson]

People love those one on one meetings, too.

[Michael Batnick]

Yeah, they do.

[Ben Carlson]

People get a lot out of those.

[Michael Batnick]

It's nice. All right, recommendations? Ben, what do you got?

[Ben Carlson]

All right, so I told you, my daughter and I are going through the list of. Of good classic sports movies. And we watched Hoosiers before, which you said was underrated or overrated, which I hope you were lying about. So we watched your favorite of all time, Field of Dreams, which is nice because they have Netflix in hotel rooms now. And I don't know, I hadn't seen this movie in 25 years probably. And there's no better way to describe it than it's just a magical movie. The whole time I just had a big smile on my face. It's perfect. And at the end I totally lost it because he's playing catch with his dad and his dad's name is John. And so I lost it. My daughter's like, why are you crying? Just leave me alone. But there's the part where him and James Earl Jones go to the Red Sox game And they get two beers and two hot dogs at Fenway. And this is 1986 or something when this movie came out, maybe 87, something like that. How much did two beers and two hot dogs cost at Fenway back then?

[Michael Batnick]

Two beers and two hot dogs, $9, $7.

[Ben Carlson]

That stood out to me, that would be. What would that be today? $50 maybe.

[Michael Batnick]

Yeah.

[Ben Carlson]

We've been watching 1923 again lately. Season two. I think we have one episode left.

[Michael Batnick]

Wait, I thought it just started.

[Ben Carlson]

No, it's all out. I thought that I would be done after one season, and it took me a while to get back into it, but it's still a good show. And there's some things that happen in the show. Like, the foreshadowing is, like, they couldn't be winking at you harder. There's this part where she gets over on a boat from Africa and she gets off and she's in the Grand Central Terminal in New York, and five people tell her, like, be careful. There's a lot of pickpockets around here. And it's like, be careful. Someone's gonna see her stuff. And of course, someone pickpockets her and steal our stuff. But it's still. It's. I'm surprised how much I still like it.

[Michael Batnick]

It's like a fun background show, right?

[Ben Carlson]

Yes. It's still pretty good. Let's save White Lotus for the end because we'll do some spoilers. So why don't you go?

[Michael Batnick]

Okay. I rewatched. I did some Val Kilmer stuff this week, by the way. I. Maybe I. I don't know if it's weird. Like, you just. You don't appreciate these people until they're gone. Unfortunately, that's just reality of life. He was one of my favorite childhood actors, and I didn't really. I don't know that I would have listed him as one of them, but Willow was my first favorite movie ever.

[Ben Carlson]

Ah, I love Willow, too.

[Michael Batnick]

So I rewatched that one. Some new. That. Some. Some ones not new, some ones that I hadn't seen. But I rewatched Heat. I haven't rewatched Heat in a while.

[Ben Carlson]

I rewatch that one every two or three years.

[Michael Batnick]

Probably they should do a release in imax, because to see that on a giant screen with the machine guns, plus.

[Ben Carlson]

Like, the Dolby speakers for all the sound.

[Michael Batnick]

Close to a perfect movie as you get. You agree?

[Ben Carlson]

Yes. It's the best heist movie ever made, obviously.

[Michael Batnick]

Why is the Pit only on Max? I didn't even realize until I went to watch it live on whatever night it was out and Rob said, no, you have to go to Max.

[Ben Carlson]

I didn't know that either. I guess I just watch everything on Max now because I'm a YouTube TV.

[Michael Batnick]

Weird, though, right?

[Ben Carlson]

That is weird.

[Michael Batnick]

All right, so I love the studio. I Will make no apologies. I love the third episode. I love the second episode. I understand some of the criticisms of why it's too much like Curb. I don't care. I love it.

[Ben Carlson]

You're taking a little bit of contrained stance here.

[Michael Batnick]

I don't think so. The consensus that I've seen has been, like, wonderful.

[Ben Carlson]

Okay. I think my only problem is I think it's a little too over the top. It needs to be a little subtler. That's my only note.

[Michael Batnick]

I love it, but it's great to.

[Ben Carlson]

See all those Hollywood people in one place. Wait.

[Michael Batnick]

Oh, yeah, go ahead. I'm sorry. I'm done.

[Ben Carlson]

All right. White Lotus. I watched the season finale, so spoilers. If anyone wants to turn it off, they haven't watched it yet. I can't believe Tim Ratliff tried to kill his family with pina coladas. I told my family, listen, I have respect. If I ever try to kill you and we're all gonna drink the Kool Aid together, we're gonna do Miami Vices. Okay? Right. Is that fair? I thought it was pretty good. It's the worst season so far, but it still was high quality and really well done and I still liked it.

[Michael Batnick]

Agreed. Worst season of the three. Excellent seasons, but I still had a great time and I was happy with the episode. Like, a lot of myths to pick, but landing the plane on these shows is very difficult, and I had fun. No complaints.

[Ben Carlson]

The shootout and the he always kind of surprised you. Like the fact that the women friends went back and they were all still friends together, and I didn't expect that. So I enjoyed it. I'm ready for another season. I know a lot of people are pushing back saying they didn't like this season. I still enjoy myself.

[Michael Batnick]

Keep coming. All right, Ben, in conclusion, these are scary times.

[Ben Carlson]

Where's the stock market? We're recording this at 1pm or so on Tuesday.

[Michael Batnick]

Scary times provide opportunities. I'm sorry. That is a core tenet of my investing beliefs. Not saying that this is the bottom or that the reward that you or that the risk that you take will be rewarded. Tomorrow might get more painful, but I still believe this is the best way to building wealth. And I don't think that there is anything that could change my mind. I know that there are crashes, right? Like, we've seen that. We've been there, we've done that. I know that's part of the game.

[Ben Carlson]

Part of this is why there's a risk premium, though. The fact that the stock market could fall 20% in the blink of an eye like that. That's the reason that you get the long term premium, because of the risk there. I also, this is one of the things that just I will never back down on to. Having a automating good decisions ahead of time is so important because that, that was the other thing that made me feel okay to go on spring break even though the market is falling apart around me. I've already made the good decisions ahead of time for not knowing that it'll happen like this, but knowing that the market could fall out of bed like this.

[Michael Batnick]

Ben, in 100 years from now, do you think you're going to be upset you add it to stocks this week?

[Ben Carlson]

I don't, no. I mean by that point I'll probably be like a, you know, I'll just exist in the computer. Right. But in a hundred years, my great grandkids will thank me.

[Michael Batnick]

The S and P is trading at 6 times 2134 earnings, so pretty optimistic about that one.

[Ben Carlson]

At this time next week, are stocks higher or lower than they are today? Not that we're short term, but I'm just. Either either we're down another 10% or we're screaming back 5 or 7%. Higher.

[Michael Batnick]

I think I'd say higher. But sorry if I'm wrong.

[Ben Carlson]

All right. Your handicapping skills haven't been that great the last couple weeks, but hey, keep trying. All right.

[Michael Batnick]

Hey, shoot or shoot. All right. Animal spirits@the compoundnews.com thank you everybody. To everybody for the, for the emails. We love to see it stay, staying out there.

[Ben Carlson]

Hey listen, see you next week. This is like scary times, but it's still, if you can take a step back, it's still just fascinating to see that this kind of stuff can happen in markets still. Right. If you get rid of the losses and all the potential ramifications. The fact that this can happen in markets is one of the reasons that I think that it's the greatest game that there is. See you next time.