The Zero Dollar Club (EP. 435)

Summary

Animal Spirits Podcast Episode 435: The Zero Dollar Club

Hosts: Michael Batnick & Ben Carlson
Date: October 22, 2025

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Episode Overview

In this episode, Michael and Ben explore the ever-shifting landscape of market sentiment, speculative fervor in unprofitable and "zero dollar" companies, the persistent AI bubble debate, and how investors are dealing with systemic risk warnings. They discuss their nuanced views on owning gold, analyze ETF and equity market flows, and comment on trends in housing, consumer spending, and auto markets. The hosts combine historical anecdotes, personal investing philosophies, and contemporary data to help listeners make sense of today’s investment climate.

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Key Discussion Points and Insights

1. Market Sentiment, Bubbles, and the Difficulty of Reading the Room

• The AI Bubble Debate Continues

  • Michael and Ben reflect on media fixation with the "AI bubble," and how the relentless commentary itself signals something unusual.
  • Michael: “No bubble in history has ever had so many people call it in advance… but no bubble in history has ever had this many people giving opinions all the time.” (03:31)
  • They reference a Today Show segment and the persistent caution from major news outlets, illustrating how ubiquitous the topic has become.

• Historic Bubbles and Sentiment Indicators

  • Michael describes reading Andrew Ross Sorkin’s book on 1929, drawing parallels with current speculation:
    • Quote from 1929 article:

      “It is quite true that the people who know the least about the stock market have made the most money out of it in the last few months.” (05:31)

    • Jesse Livermore used this as a contrarian signal, shorting the market and reportedly making $100 million then.

• Relevance and Reliability of Sentiment Indicators Now

  • Both hosts agree that traditional sentiment signals are far less useful due to the democratization of information and mass participation.
    • Ben: “I’ve said this a million times. Are you looking at Schwab investors? Reddit? Wall street bets? Media wants a bust—they’re dying for it.” (07:05)
  • They caution against taking negative headlines as systemic warnings without supporting data.

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2. Systemic Risk Warnings and Investor Behavior

• The “Everything is a Risk” Narrative
  • Michael voices fatigue with endless doomsaying:

    “I'm sick of people warning me about systemic risk. I’m at the show-me point—stop telling me what could happen. Show me when it does.” (10:31)

• BDCs, Regional Banks, and the Default Setting for Worriers
  • Ben: “The more you expose yourself to different asset classes, the more likely you are at some point to rip something out because it’s not working.”
• Historical Perspective
  • Many worries, like the recent 10-year Treasury yield panic, faded away: “Remember we were worried about that? Doesn’t matter anymore.” (09:08)

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3. Why (Not) Own Gold?

• Personal and Philosophical Stances
  • Michael outlines his arguments for not holding gold, while acknowledging reasonable "insurance" and diversification cases.
    • Michael: “Three out of four decades where gold was in a lost decade.” (14:09)
    • Ben counters that those periods followed exceptional runs, and rolling returns or correlation with a 60/40 portfolio should be considered.
• They joke about bitcoin’s failure to “knock gold down a peg.”
• Notable Exchange:
  • Ben: “Gold is a headline asset... gives potentially uncomfortable feelings about the system.” (11:39)
  • Discussion of “gold bugs” who only seem happy when the system fails (12:05).

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4. Diversification — You Can’t Own Everything

• Trend Chasing and Portfolio Construction
  • Ben: “If you own everything, at some point you’ll rip something out because it hasn’t worked over X period of time.”
  • Historical examples: Managed futures after 2008, gold’s various cycles, etc.
• Diversifying Assets Keep Rotating:
  • Citing Verad Capital’s research, they note that the “best diversifier” shifts every few years.
  • The challenge: “You have to be okay not owning everything.” (17:50)

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5. ETF and Equity Flows — What’s Driving the Records?

• Enormous ETF Flows:
  • $1 trillion mark in ETF flows — “Unbelievable.” (24:29)
  • Top flows to S&P 500 and Bitcoin ETFs.
  • Theorizing the drivers: Inflation, baby boomer rollovers, conversion from mutual funds, workplace retirement contributions.
• Equity Value Across Households
  • Under-40 households have increased equity value by 542% since 2020. Ben and Michael debate whether this is healthy speculation or a risk-prone surge.
  • Ben: “It would take an extended period, maybe a crisis, for young people to throw in the towel.” (28:25)
  • Michael self-corrects, noting most young investors' assets are probably in blue chips or ETFs, not meme or speculative stocks.

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6. The “Zero Dollar Club” and Speculative Mania

• Companies with No Revenue, Huge Gains:
  • “Zero Dollar Club” refers to heavily-speculated companies with little or no revenue, now commanding multibillion-dollar valuations.
  • Michael: “This is a young man’s game and I’m no longer a young man. That’s $35 billion.” (31:40)
  • They acknowledge some may be justified if national policy shifts or government support comes in, but recognize the enormous risk.
• Speculative, Retail-Led Environment
  • “Despite clear outperformance from such stocks, long-only managers underperform… This decade, literally the only people winning are retail.” — Jim Chanos, quoted by Michael (44:10)
• Shorting is Hard
  • “Hedge funds are so bad at shorting stocks.” (42:12)

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7. Crypto, Housing, and Other Asset Classes

• Crypto Market’s Big Bets
  • Will Bitcoin top $200,000 by 2027? The odds are near 50/50 in prediction markets.
  • Michael: “That number should be 25%.” (45:54)
• Housing Market Frustrations and Wealth Effect
  • Data from Redfin shows homes sitting longer, higher down payments, and a shrinking qualified buyer pool.
  • Ben sees a sharp uptick if mortgage rates dip back under 5%; Michael’s more skeptical after seeing repeated “failed rallies.”
  • Ben: “It’s a shrinking group of people who can afford to buy.”
• Regional Home Cost Differences
  • Data from Flowing Data: States like California are far above average, but “there are more states below the national average than above.”

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8. Consumer Credit, Spending, and Bank Health

• Amex: K-Shaped Economy
  • Amex’s premium business continues to thrive, with Gen Z showing 39% YOY spend growth, Millennials surpassing Baby Boomers for total spend (52:16).
  • Amex is not a traditional credit card, so these numbers reflect premium spenders, not distressed borrowing.
• Credit Card and Bank Charge-Offs
  • Bank of America’s net charge-offs and delinquencies are falling — “Show me the data.” (55:17)
  • Michael: “If you had one indicator… credit card companies, that’s your indicator.” (55:17)
• Historical Perspective on Poverty
  • Even after the Roaring ‘20s, 60% of households were below the poverty line; today’s pain is real but not unique.

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9. Auto Markets — Sticker Shock and Underwater Loans

• $50,000 Cars and Average Car Age
  • Average new car price is now $50k, but longevity and tech upgrades are significant — “It’s like the stock market, the multiple should be higher, it’s just a better product.” (63:09)
  • Most cars are technically "underwater" immediately after purchase — nothing new here.
  • Bloomberg headlines about underwater loans (28% of new car purchases) are more dramatic than the reality supports.
• Anecdotes on Car Leases & Brokers
  • Exchange on end-of-lease car values and whether it’s time to switch brokers, with typical Animal Spirits banter.

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10. Miscellaneous: ETFs, Regulation, and Consumer Experience

• Extreme ETF Products
  • SEC filings for 5x leveraged single stock ETFs raise red flags: “If this poses market structure risk, then ban it immediately.” (36:14)
• China, Trade Wars, and Macro Debates
  • China’s pain tolerance is discussed; Michael and Ben agree the U.S. caves sooner, but believe in the long-term edge of freedom and innovation.
• Media vs Reality
  • Michael notes that the abundance and repetition of headlines can distort historical memory; future generations may have a “choose your own adventure” version of history (58:24).

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Notable Quotes & Memorable Moments

• On market bubbles:

  “No bubble in history has ever had so many people call it in advance… but no bubble in history has ever had this many people that are giving opinions all the time.”
  — Michael Batnick (03:31)

• On owning gold:

  “I just personally could never wrap my head around it… I get why people hedge or diversify with gold, but for me, three out of four lost decades is too much.”
  — Michael Batnick (15:53)

• On speculation and retail winners:

  “This decade, literally the only people winning are retail… retail degen traders or retail just, I’m going to buy what I know.”
  — Michael Batnick (44:10)

• On shorts and speculative stocks:

  “Hedge funds are so bad at shorting stocks… They did not learn their lesson from the Gamestop fiasco.”
  — Michael Batnick & Ben Carlson (42:12)

• On wife and pumpkin farms:

  “I’m done with pumpkin farms. Just take the pumpkins. I want to go home.”
  — Michael Batnick (69:42)

• On audio learning:

  “It feels like I’ve unlocked a new form of learning in my life with Audible.”
  — Ben Carlson (67:16)

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Timestamps for Important Segments

• AI Bubble Discussion & Sentiment – 02:16–08:13
• Historic Bubbles & Contrarian Signals – 04:09–06:09
• Media’s Role and Changing Indicators – 06:43–10:47
• Systemic Risk, BDCs, and Risks that Don’t Materialize – 09:14–10:47
• Gold: To Own or Not? – 10:48–15:53
• Diversification Evolution and Limitations – 16:49–18:28
• ETF Flows & Equity Value Distribution – 24:29–29:20
• Zero Dollar Club & Speculative Stocks – 30:48–34:02
• Crypto Prediction Markets – 44:53–45:54
• Housing Market & Demographics – 45:57–48:47
• Amex Spending & K-shaped Economy – 51:13–53:18
• Car Market & Underwater Loans – 62:31–66:37
• On Modern Wealth & Historical Comparison – 59:42–61:38

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Recurring Themes & Tone

• Origins: Rich with history, amusing personal stories, pop culture asides, and honest reflection.
• Tone: Mix of banter, straight-shooting optimism, skepticism about doomsaying, and a grounding in empirical data over narratives.

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Closing: Recommendations and Listener Connections

The episode closes out with media recommendations (John Candy documentary, ‘Tremors’, and more), Michael’s favorite horror movies for Halloween, and playful anecdotes about family life, home renovations, and fall traditions.

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Summary Takeaways

• Be skeptical of broad, systemic risk narratives unless backed by hard data.
• Sentiment signals are less useful in today’s environment of information overload.
• Retail investors have dominated during this decade’s speculative stretch.
• Diversify knowingly but accept you can’t own every winner.
• Beware of letting headlines overtake real, long-term investment discipline.

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Email feedback or questions: [e-mail]
Podcast link & disclosures: ritholtzwealth.com/podcast-youtube-disclosures

Transcript

[A]

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[A]

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

[B]

All opinions expressed by Michael and Ben are solely their own opinion and do.

[A]

Not reflect the opinion of Ritholtz Wealth Management.

[B]

This podcast is for informational purposes only.

[A]

And should not be relied upon for any investment decisions.

[B]

Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this Podcast.

[A]

Welcome to Animal Spirits with Michael and Ben. Michael, I told you I know you didn't want to talk about the AI bubble anymore, but I want to talk more about sentiment in general.

[B]

Hold on. You're putting charts into my. Into my doc? I never said that. I never said I don't want to talk about the AI thing anymore. I merely said I feel like it's all we're talking about. Can't avoid it.

[A]

Oh, okay. Two weeks ago, you said you wanted to do an entire episode with no AI talk. Remember?

[B]

Impossible.

[A]

Did you forget this?

[B]

Already failed? Failed.

[A]

All right, so I want to talk about the difficulty engaging sentiment these days. So Bloomberg has this chart, and they show that the S and P has gone nearly 100 days out of 5% pullback, and the average is around 97. So we're right about there, which is kind of. Kind of crazy. It had been that long, and this whole article was about like, hey, listen, turbulence ahead. Expect more volatility. We haven't had this 5% correction. It's coming. Do you look at these AI takeaways from all these articles now? It's like the very top of every article now. Wall Street Journal, Bloomberg, AI takeaways.

[B]

No, I still. I still read the articles manually.

[A]

Okay. The whole thing is just talking about how, like, stocks are due for a pullback. It's. You know, my wife is still a Today show watcher. Which one does your wife watch?

[B]

Cause Good Morning America.

[A]

Good. Yeah. So everyone has their one. My wife has. She doesn't even watch it, really. It's just on in the background. Okay. And she had it on.

[B]

On.

[A]

I think this was Sunday Morning and the whole. They had a whole expose piece Willie Geist talking about, are we in an AI bubble? I did a little screenshot here of my tv. It's weird because on the one hand you'd say, listen, no bubble in history has ever had so many people call it in advance. But I think you could also say no bubble in history has ever had this many people that are giving opinions all the time. So I'm reading. I'm listening to not reading. The 1929 book by Andrew Ross Sorkin. That one on your list?

[B]

I'm gonna do it the old fashioned way. I'm gonna read it.

[A]

Okay. Way too long for how many pages is it? It's way too long for me to read, so I had to listen to it.

[B]

Credit to him. I didn't even look at the back yet until just now. He's got Ron Chernow, Walter Isaacson, Beverly Gage and John Meacham writing reviews. That's, that's, that's the Mount Rushmore reviewers.

[A]

Okay. Sense. Because this, this feels like a biography in the sense that there could have been some stuff in the chopping cutting room floor. Okay, no offense, that's how I feel about all biographies. Right. But this is. It's a story. And I'm a huge fan of the reading about the Great Depression. It'd be weird to say I'm a fan of the Great Depression because that's obviously a really bad time in history of our country. But he. It's way more stories and anecdotes than I ever thought before. But there's a really in. In ton of good characters, and there's some that it's like, some that's a little too much. But then you hit hear these anecdotes and stories you never heard before. So he has a whole chapter on Jesse Livermore, which is excellent. And he talks about how there was this story in the New York Times in 1929 called the Magnet of Dancing Stock Prices. And I actually found this. I think you showed me this. The New York Times has their archive, right. So I pulled up the actual story, and it's funny because a lot of it does. And people keep asking Sorkin about, like, does this period, time, period kind of make you feel like the 1929 peak? A little bit. And so this is from the article. Despite setbacks, the broker's wires again become clogged with orders for stocks from all parts of the country. Tips fly about freely. Violent advances and declines in leading issues are a daily occurrence. This is the best part that reminds me of today. It is quite true that the people who know the least about the stock market have made the most money out of it in the last few months. And Jesse Livermore stepped in and he. He essentially said, I'm using this as a contrarian indicator. All the amateurs are making way more money than the pros. I'm shorting the market. And he did. He made like.

[B]

He made like 100 million, I think.

[A]

In 1999, and he made a 20 ton of money. And this isn't. This isn't a quote from the article that I never heard before. He said stocks could be beat, but no one can beat the stock market. So that was a really good. Yeah, I've never heard that one before. It's really, really good. Yeah. So anyway, it talks about how he used this. And he. He used this. This sentiment shift to short the stock market, made a ton of money Can.

[B]

I ask you a question? You think Livermore was a. There he is. Or was he that guy?

[A]

Well, they said he, he really liked to show off his apartments and his cars and his nice clothes and.

[B]

So he might have been this guy.

[A]

Yeah, he wanted to be. Oh, there he. Oh, there he is. One of those guys. But anyway, I just, my whole thinking is I don't think that you can use these indicators as well anymore as you did in the past because there's just so much of it everywhere. It was, it was very confined in the past. You wouldn't, it wouldn't be shoved in your face all the time.

[B]

I'm glad to hear you mention that because I feel like the noise of the sentiment that that's, I've been on that corner for a while now and you could look at 10 different pieces of information, data and make 10 different conclusions. Now, of course, the best is to just make it composite, but even then, which investors are you talking about? I've said this a million times. Are you looking at Schwab investors? Because their S. Tax report paints a lot, much different picture than what you're seeing on Reddit or Wall street bets or the Robin type of younger like so. And then to the point about the media. The media covers the stories and the bigger the story, the better their ratings. And so they are dying for a bust. Right. Like that would be a very. Yeah, that would be a great story. So I think you're 100% right. It's, it's just, it's very difficult to talk about indicators the way that we used to because how many over the last decade have we. Could we point to now? Listen, once in a while they work, obviously. Right. Like, they're not, they don't all not work.

[A]

Right.

[B]

But I keep coming back to Jensen Wang signing a bra and the Nvidia Watch party was that two years ago at this point right now, if you zoom out, if you zoom out and this does become an 80 washout, which I very much don't think is going to happen. But if that were to happen in the future, 50 years from now, people are reading about today. Well, it doesn't matter if These indicators were 24 months early in the grand scheme of things.

[A]

Yeah. But to your point about the financial media, I've made the point that the financial media was cheerleaders for the dot com bubble. And, and no one in the financial media called the 2008 crisis.

[B]

Well, they learned their lesson. They don't want to be embarrassed again.

[A]

Yeah. So the fact that the financial media is more negative about everything going on. Right. And pointing out all the risks all the time. There's a reason for that. That's learning, learned from past behavior. But I, I, I think it's funny though because you see, so right now the, the worry is what regional banks and BDCs and maybe private credit and, and there's, there's so many of these worries. I put this chart in here about the 10 year treasury yield back under 4%. Remember three months ago when people thought treasuries are at 5% that means we're imposing fiscal discipline and bond vigilantes. And here we go, inflation is taking off. And I think all these little things people worry about, I think it's worth reminding people that the majority of them just kind of fall by the wayside and people forget like, oh, remember we were worried about that doesn't matter anymore.

[B]

Well, that's, that's, that's gotta be your default position for most things. Now. It doesn't mean that you're being complacent and you're not worried about risk because as investors, risk should be first and return should be, who cares? They'll take care of themselves. So you have to be disciplined. And it's not to be, oh, nothing matters. But it's. Okay, how about this? If there's two extremes, everything matters and nothing matters, probably nothing matters is the better default position. And that's, that's where I landed on this, this BDC stuff. I've been doing a lot of reading on it and the truth is we're all guessing. Nobody knows, nobody's, nobody knows where the cock, which is nobody reading the loan documents. I know as much as everybody else. I read the same about this.

[A]

Sometimes there is only one cockroach. Sometimes it is your first rodeo and sometimes you haven't seen the movie yet and you don't know how it ends.

[B]

Right?

[A]

How's that?

[B]

Yeah, I love it, Ben. But the, the, so my default position with this is yeah, there's some bad behavior going on and there's some, there's some bad loans being made. I, no doubt about it. There's no doubt about it. There's too much money coming to the space. People are, are lackadaisical. There's no, I have no doubt about it. But does that mean that this is systemic risk that is going to take down the financial system and BDC is the canary in the coal mine? Maybe. It could happen, right? We'll see. But I don't, that can't be that Your default case. Unless you really know something that everybody else doesn't. Unless you really know.

[A]

I'm sick of people warning me about systemic risks. Like I'm, I'm at the show me point of stop telling me this could lead to something down the line. Show me when it does. That's where I am at. Because it's everything that people have warned us about. None of it has mattered, right? None of it.

[B]

Most of it.

[A]

All right. Speaking of hedging systemic risks, I wrote a blog post about why I don't own any gold. And it's, it's a tough position to be in because. So here's our friend Matt.

[B]

I would, I would not be pounding the table on why we. I don't, we don't own gold. Like it's, you know, gold is kicking ass.

[A]

I'm not pounding the table. I want to explain myself. So MEB Faber says, listen to a suite. Going to be a lot of uncomfortable conversations at year end when people ask why their portfolio manager or advisor doesn't own any gold. Been a menace this year. So I felt like perfect time to explain the reasons behind why I personally don't own any.

[B]

Well, we don't. I think we don't own gold for clients. And there's, there's people that are asking about it. Yeah, because gold, Gold is a headline asset.

[A]

Here's the. Here. Yes, it is. When it's doing well or when it's not doing well. Here's the thing though, like when MEB says there's going to be a lot of uncomfortable conversations. You could say that every single year about any single asset class. Why don't we own Bitcoin? Why don't we own biotech stocks? Why don't we own.

[B]

But, but gold. Gold is a. Gold is a different beast than all of those things. Gold is not biotech stocks because gold is. When gold is flashing on the front pages of the, of the paper of the USA Today, it gives potentially uncomfortable feelings about the system, about the dollar, about confidence in the economy and the political system like it is its own beast. And people don't ask about biotech stocks or any other asset class the way that they own. Ask about.

[A]

Yeah, and I, and I heard from. There was some crazy gold people who, who gave me the business a little bit on this. And it's funny because the real true gold bugs. It's funny even when gold is working, they're not happy. Right? They're not. Because it's like, of course the system's going to. The system hasn't failed yet. Like, they want the system to fail. That's the only time they're happy. But there's a lot of people who wrote me and said, listen, I put 5 to 10% in gold as an insurance. A lot of people use the word insurance for me for why they own gold. And I thought that that's a, That's a completely fair reason. It's a hedge. It's an insurance. It's. It's the dollar falling. It's all this stuff all valid. And, and I get it. And gold is one of the most unique asset classes that there is. It really does march to its own beat. And I think. So, like the case, I, I tried to paint a nuanced picture here. Like, I totally understand the case for owning gold.

[B]

I just, I do think, I do think last week you're, you were a bit harsh on this podcast saying that, like, none of what they said came true. Like, it felt like it felt beneath. Beneath you. You're punching people when they're winning. It felt, it did feel. It didn't feel great.

[A]

Okay, I, listen, I just, I, it was, it's more the charts than anything. I was, I was.

[B]

I know, I know where you're coming from. You're thinking like, oh, the dollar is going to blow up, the system's going to melt down, and therefore gold is going to be your savior. I know what you were saying, but in a vacuum, it felt, it felt harsh.

[A]

Okay. I am an optimistic person. I'm anti doomerism. So that, that maybe that's where I'm coming from is that I, I don't like the people who are constantly trying to use scare tactics and so same page, of course, those chart crimes and stuff just kind of. But listen, the people who own 5, 10, 15 or 20 in gold or whatever, obviously they don't think the system's going to fall. It's an, It's a diversification, volatility, rebalancing. Because that piece makes sense to me, obviously. Like, I, I get that from a portfolio management perspective. Here, let me just walk through why I don't. My personal opinion on it. So I did this thing in the, in the, in my post where I looked at the return history of gold and gold went crazy in the 70s, mainly because Nixon ended the peg to gold with the dollar. Right. So it was up like 1400%. So that it's a huge. And it was playing catch up because it was pegged all those years.

[B]

I feel like that, that whole period, the, the, the bubble and the aftermath sort of has to be removed from history because it is a true one of one will never happen again. So it's almost like irrelevant a little bit now. I know it also, it also coincided with, with inflation. And so that's part of the story. So we can't do that part of it.

[A]

Oil price shocks. And so. But my, my point is, if you look at gold in the 80s, 90s, 2000s and 2010s, you had three out of four decades where gold was in a lost decade. So in the 80s and 90s, gold. And obviously part of that was the overhang from the 70s. But that whole period, I'll be honest, that, that whole three out of four decades of having a lost decade and going nowhere. Now you could say I'm cherry picking because if you start in 2000, hey, gold looks pretty good. You start in 2020. Like there's time periods where gold does look better. I just. That whole period of multiple decades in a row where you go nowhere. And now some other people said, listen, you're comparing gold to stocks. That's the wrong comparison. Compare gold to bonds. And if you look at the long history Demoderin has the return history going back to 1928 for gold and actually gold returns going back that long are closer to bond returns, actually. And obviously some people would say, well, why do we have to choose? I could do gold and I could bonds and I could do stocks. You don't. So I, and, and I'll be honest, I, I was wrong about this. I kind of thought bitcoin would take the shine, pun intended, off of gold a little bit. So that this, it surprises me that bitcoin didn't knock gold down a peg. I, because I'm more of a, I guess a techno optimist. And I, I would have thought gold, bitcoin would have had a bigger impact on gold. So I was wrong about that. But that, that's the reason it's, it's more of a market history thing for me than, than anything. And, and the people own it. I understand it, but I just, I personally could never wrap my head around it.

[B]

Fair.

[A]

Anything to add?

[B]

I mean, this is, it's such a big conversation. It's like I feel like you could spend an hour on this. There's a great book, the History of Gold or the power of Gold by Peter Bernstein.

[A]

Yeah, that's right.

[B]

Gold is an interesting, unique.

[A]

And it's been around for thousands of years too. So that, that could be part of it.

[B]

I guess the only, the only yeah, listen, I mostly, I mostly agree with you. I don't old gold either. We don't know if our climate says so, we're, we're on the same page. The thing that, the thing that it's like again the decade of the 80s you really have to take with a grain of salt because that happened after one of the greatest runs of all time.

[A]

Right.

[B]

So I think it's, I think it's more fair to look at like maybe rolling returns or how it diversifies to 60, 40, 40 portfolio. Do you need gold? Obviously we don't think so. Do I wish we own gold this year? Absolutely. I guess like anything else, I would say that know why you own it? If you don't, if you didn't own it, now is now the best time to really dive in.

[A]

I mean probably, I think that's, that's the point. I, but there's, I think there's always going to be something that you go, man, I wish I owned that or so. So Verad Capital did this really cool chart where they show the US equity market in a 6040 portfolio going back to 1975. And they look at what was the diversifying asset. And you see that, see these colors, how it changes. So it's in some instances it was international equities and REITs and gold and factors and fixed income and commodities. And it changes every two to three years where it's like the, this is the diversifying asset. Now you could say, listen, I'm going to own them all. And as a someone who is a diversified investor, I like being widely diversified. But I also don't think that you can own everything. Remember following 2008 crisis, in 2000s, everyone talked about how you need to own managed futures.

[B]

Yeah.

[A]

And some people would say, listen, you have golden managed futures and you'll be fine, do that. Just do it. Trend following. But to me, that was like, I understand the appeal for managed futures. It just doesn't fit in my portfolio purview. And that's okay. I mean you have to be okay not owning everything, right?

[B]

You can own everything. You definitely can. But if you do, depending on the rapper in which you own it and the visibility in which you own it, there is a high degree of likelihood that at some point you're going to rip something out because it just doesn't work or I'm using air quotes, it hasn't worked over X period of time. And the more you expose yourself to different asset classes, the more likely you are not everybody. But in general, the More likely you are to point to something and say, get rid of this piece of shit. It's not working. Why do I own it?

[A]

That's the thing. And the problem is you do that and then you add something else that just did well, and then you're investing in the rear view mirror. That's the problem. So, yeah, you just have to be comfortable what you own and why you own it. I understand why people own gold, I just personally don't. That's all.

[B]

Yep. Okay. Remember this chart? Mike Bird tweeted.

[A]

Who?

[B]

Remember those Fed balance sheet s and P500 charts? You don't see those so much anymore. And it was. Yeah, it's funny. Yeah, great chart. This was the thing. It was all liquidity. Fed induced liquidity. And I'm not saying that wasn't part of the story, because it absolutely was, but clearly wasn't the whole story. And I mean. AI, my God. Not to. I. I can't not bring it back to that because it's true. Absent. Absent open AI and what they're doing in the arms race, maybe this would have. Maybe this chart. Not in fact, not maybe this chart would have looked a lot different. It is highly possible that the S and P would have followed this chart and this relationship would have appeared to be rock solid.

[A]

Were you a Scooby Doo watcher when you grew up?

[B]

Oh, yeah.

[A]

Okay. So at the end of every episode, they would. The bad guy would say. And I would have got. He would tell his whole plan. He said, I would have gotten away with it. It wasn't for those darn kids and that dog. Right. That's the stock market of the US Economy. It's always the bad guy saying, I would have gotten away with it. If there's. It seems like there's always something and eventually there won't be something.

[B]

Sometimes those, Those cries are more valid than others, and I feel like this time it is. It is valid. I think that absent, absent open AI, the stock market would not have bottomed in October 2022, and we would be singing a different story.

[A]

Yeah. But my point is the US Economy, it's almost always something that saves us.

[B]

You're right. And. And speaking of October 2022, last week we spoke about the. The fun you have debating when a bear market started. When. When a bear market ended. When a bull market started. While it is. It is unequivocally true that the market did bottom three years ago. And Yurian Timmer wrote a piece on where we are, year three of the bull market. The Bull turns three. So this next segment is sponsored by Fidelity Trader Plus. They allow you to trade seamlessly across all your devices from anywhere. If you want to learn more, check out Fidelity Trader Plus. Let's look at some of Yurian's charts in this note that he put out.

[A]

So some of the best charts in the game too.

[B]

He's. Does he have the crown?

[A]

I mean, they just look the best. I don't know how he does it, but. And if you missed it, he was on acid compound with me a couple weeks ago. We just did a whole thing where I just. We went through all of his charts. Yeah, you know what, it was fantastic.

[B]

You know what, I think you could crown him. He's certainly on the Mount Rushmore, but he's. Yeah, he's the king of charts as.

[A]

Far as the good thing is, is that no one's charts look like his.

[B]

Yeah, yeah, yeah. All right, so the first chart that I want to pull out, he looks at cyclical bull markets. The median length, and he does them with dots. And the size of the dots represent the Cape ratio over that period of time. I've never seen it broken down this way. So this chart also, it adjusts for inflation. So look at like for example, look at the 1978 cyclical bull market. Look at, look how tiny those dots were.

[A]

Oh, okay.

[B]

Money. Right. So I think what stands out to me on this chart is this is right down the fairway because there's another line and you just go to the shots to take a look at this. If you're not, if you're not watching the video, there's another line that shows like the average path or like a band. And this is following it to a T. That's interesting.

[A]

So this is. So we had a textbook bear market, like non recessionary bear market. And this is a now a textbook bull market coming out of it.

[B]

Here's another great one. So Urian says the first year of a bull market typically begins with PE expansion as price discounts and earnings recovery. And then in year two, the baton gets passed to earnings growth as valuation compresses. Not this one. So take a look at this. I've never seen it broken down this way. He's showing the price from the low, he's showing the PE from the low, and then he's showing their earnings per share from the low. And the price, as we mentioned already, right down the fairway. PE on the higher side, and earnings growth pretty much steady as it goes, like right in the middle. Then the next chart shows this and this is the, this is the key takeaway, at least for me, for as much as we talk about bubble euphoria, expensive stocks, peak earnings, and maybe look at this. So Urine's chart shows the stock market on top and on the lower pane, he shows the EPS growth and the PE over year. The PE has only grown by 1% over the past 12 months. Only 1%. Not a lot of multiple expansion there. 11% earnings growth.

[A]

So yeah, this recent period has been almost all earnings driven and fundamentally driven. Right, that's good.

[B]

And exactly what you want to say.

[A]

And it's not a huge spread either. Right? It's. It's pretty. There's a lot of huge spreads on this chart.

[B]

So look at what happened like in the rebound in November, in the spring of the spring and the summer of 2020. That was all multiple expansion. You had earnings shrinking. Duh. Right. Obviously. And you have PE is supporting the entire rally.

[A]

Right. Which is because in 2022, the PE ratio dropped by a considerable amount.

[B]

And that was an interesting observation too. In, in 22, obviously multiples got crushed and earnings. Yeah, earnings fell, certainly. Or, or they came off the highs, let's say another weird period in time. You know, everything's a weird period in time.

[A]

Yes. No, this, if you look at. Just compress this to this decade. Look at. It's. It's crazy. It's all over the map. And obviously that, that's the COVID and supply shock and inflation and all that stuff. If anything, the most normal part of the period is right now. Right. The last 612 months or so.

[B]

Sure.

[A]

Feels like everything before that was crazy.

[B]

That was a. That was a JK. All right. Balchunas tweeted $1 trillion with two and a half months to go. He's talking about ETF flows. Unbelievable. Unbelievable.

[A]

So look at, look at the biggest flows. Voo, ivv, sgov and vti. And then, then ibit, which is the bitcoin. So three out of the four are just big stock market ETFs and then short term treasuries.

[B]

Keep asking this question. I don't know that there is an answer. That's not very simple. Where is all this money coming from?

[A]

I mean, listen, part of it just has to be inflation, doesn't it? It is funny at three out of the top 4s and P500. But.

[B]

No, no, no, I'm saying like the fund flows. Like is it, is it, is it merely earnings? Like American people are earning a lot of money and then putting it into the stock market.

[A]

So if we're looking at.

[B]

I'm sure that's obviously the biggest source of it, like, duh. But it just seems like so much money.

[A]

I would. I would need to study this further. But how much of this could possibly be. Baby boomers retiring rolling over 401ks into IRAs. And that money is going into ETFs and money going into financial advisors.

[B]

That's a.

[A]

You need to see the other side of the equation with mutual funds to understand that.

[B]

Okay.

[A]

But yeah, you know what theory?

[B]

That's a. That's a. I'm going to say that's obvious. That is 100% happening.

[A]

That that's probably part of it.

[B]

So is that two thirds of the pie or maybe more?

[A]

Or. I mean, think about our business. When we have people come to us who have individual stock holdings that they made a ton of money on, what do we. What do they want us to do with that? Diversify it.

[B]

Yeah.

[A]

Out of the concentrated position into funds or. Right. So I think that's probably part of it. It's not the whole thing. It's part of it, though.

[B]

Well, hold on. Maybe two thirds is underestimating it. It's earnings and it's. And it's that. What, What's. What other pieces can there be?

[A]

Where the money's coming from? Where else would it come from?

[B]

Right.

[A]

Com. Yeah.

[B]

Earnings and 401k stuff. All right. We cracked the code. Good stuff, Ben. This is a great 1. Since 2020, the value of equities. Who tweeted Daily Trick. The value of equities held by households has risen 300% for households under 40, 542% for the final 50% of households, and 50% for the middle 40%. The 10 to 50% of households. This is via Citadel Rubner. There's a wonderful chart.

[A]

That's really good. This is really good.

[B]

So the value of equities held by the middle 40%. That is steady as it goes for the most part. Now, there was an inflection in 2020, but the under 40. This chart is worrisome. And I love. I love that people are in the game. I love that they're speculating.

[A]

You're worried about this. I think this is fantastic news.

[B]

No, no. Worried. I don't know if that's the right word. Let's just say that I think that this one is the most susceptible to drop dramatically.

[A]

Okay. That's fair.

[B]

Because as a lot of these DJ names, and I don't mean that disparagingly, I would assume that this is not cool to say. But listen, I'm sorry, I don't know what else to call it. A lot of these non profitable names that have gone up into the right, which is what this crowd owns, they are going to crash.

[A]

So I think my thesis is, and again, I think this is fantastic news that younger people are more represented by the stock market. This is great.

[B]

So do I, by the way. Three trillion, that's, that's a hell of a lot of money. Wow.

[A]

If, if you look historically, the, the really bad. It takes a really bad period for young people to throw their hands and give up. So after the 70s, when the death of equities happened, it was young people who gave up. Older investors stayed invested. Young investors said, I'm out of here after the 2008 crisis and, and we saw two 50% crashes. It was young people and millennials that said, I'm done with the stock market forever. So I think it would take, especially since people are more diamond handsy these days and used to crashes, I think it would take an extended period and probably a financial crisis to get young people to say, all right, I give.

[B]

Up, I'm tapping out 100% concur. Can I take umbrage with something that I just said? Now I've mentioned this in the past, but it's been a while. So for newer listeners, there's times that I say stuff on the show that I acknowledge sounds completely idiotic and I'm about to do it where I will listen back to something I said two days ago and said, nope, nope, you're wrong and it's me, I'm calling myself out. So we've got takes flying all over the place. So if you disagree with something that I said, there's probably a good chance that I would say, yeah, you're right, that was stupid. All right, so what did I, what do I disagree with myself 30 seconds ago about this inflection point that you saw in 2020? I think that if you were to look at the aggregate holdings of this younger cohort, it most likely is dominated by the Mag seven names. Okay. It is most likely dominated by the blue chippers. Not probably.

[A]

There's probably more ETFs and index funds in here than most people realize.

[B]

Yeah. So it's not to say that those can't fall 50%. Of course they can. But the names that I was just referencing, the nuclear, the uranium, the quantum computing, all the names that are up 1,000% of the last 12 months, that's the names that I think are at some point going to crash. And I also think that that is probably a relatively small, let's call it less than 10% slice of the pie.

[A]

Right? Yeah. These people are the, These people are the gamblers too. They're. They're on the Reddit or they're on their sports stuff. Gambling, like this is just. I don't think that crowd. It's going to take a really bad bear market to get that crowd.

[B]

Yeah. And now I also, I also think that these people are smart. Like they, they know what they're doing. They know that the, the music is playing. Now there's some true believers who think that these companies are the future. Maybe they are.

[A]

And they've also, they've jumped from the meme stocks of GameStop and AMC to these other. To AI stocks, quantum computing, to like these people. These people who are speculating and stuff. They've been jumping from idea to idea, stuck in something, have been.

[B]

Have been making a hell of a lot of money. So I don't begrudge. This is not shot. Shot and Ford if, If it doesn't crash, I would do great.

[A]

Wonderful credit to you for saying that word correctly because it's always hard for me.

[B]

Yeah, no, I'm. I have no rooting interest for these people to lose money. I, I don't like when people lose money. All right, so. So at Speculator, Underscore IO tweeted a list of these companies. It's called the Zero Dollar Club. And there's.

[A]

Wait, why is it zero? Because they don't make any money.

[B]

That's right, Ben. That's wild, huh? Forget about money losing companies. Like companies that like basically have little to no revenue, like Serve Robotics is on here. We've joking about that because. Because I think that's the name that Josh might have owned in the past. We were looking at their earnings report and it was it like $400,000. ARR. I mean it's like a joke. It's like a, it's like a seats. It's like a.

[A]

It is funny that on this chart they list price to sales and price to earnings for everyone is at na.

[B]

And then it shows the year to date returns and it's just, it's. It's hilarious. I mean, absolutely a wild scene here.

[A]

So, so obviously the BA and I. I don't follow these, these DGEN socks very closely. The. The market caps for these were pretty small to begin with, but now they're all like relatively large companies. Yeah, like look at the size of the market caps. On these things.

[B]

Yeah, dude, these are, these are not small names.

[A]

They're not tiny anymore.

[B]

So what's the biggest name on here? Ast. Space Mobile. ASTS is the ticker. I will admit I am not familiar with this name. This is, this is a young man's game and I'm no longer a young man. That's 37, that's $35 billion. Olo is 25 billion. Rtti is 18, QuantumScape is 10. Joby is 15.

[A]

Big companies now.

[B]

And listen, these allegedly are going to be the companies that, that change the world. So I'm, I'm hoping that they work. Okay, don't, I don't get it twisted. I'm not, I am not looking to pound my chest if these names crash. I think everybody's consensus that these crash.

[A]

There's no way that a pasta is going to change the world. Brigetti Computing is never going to change the world. I'm, I'm willing to say that.

[B]

I'll also say like there is a reason that these stocks are, are doing what they're doing. And now there's always a reason. And it doesn't mean that it's not being taken 3,000 steps too far, but there's a reason. So Morgan Stanley has a national security index. Who tweeted this, I want to give this person credit. Dividend talks. So 39 companies across four major industries worth watching. They look at nuclear energy and uranium, battery batteries and energy storage, rare earth and strategic metals and lithium. And a lot of these names are in this list. And so if these are deemed to be national security type stocks and the government gets involved and puts them on our balance sheet. Lolo. Maybe, maybe the valuations might not make sense, but maybe they might, maybe they might be elevated for reason.

[A]

So getting back to my Scooby Doo analogy with all this stuff you're seeing, like if this economic recovery or economic expansion continues in the years ahead, people are going to go, well, if it wasn't for robotics and if it wasn't for self driving cars and if it wasn't for all this, this new energy sources, the economy and the stock market would have rolled over that. That's going to be the story if this thing continues. Right. They're going to like, it's kind of crazy to think we're people are debating the AI bubble, but we haven't even got the robotic side of things yet. Yeah, like I actually think, here's my take. I think if an AI bubble does burst, I think it will be a glorious, glorious Buying opportunity, because the AI stuff is going to work eventually. Robotics is coming along like you could if there's a 20 to 30% bear market because the AI stuff gets too far ahead of itself, it is going to be an unbelievable buying opportunity for the years ahead.

[B]

I need a humanoid in my house that can do all sorts of tasks. One of them, electrician, plumber, cleaner, all this sort of stuff. I need somebody, I need a robot to look at my WI fi connection and figure out what the hell is going on. Because I've had Verizon in here three times. And, you know, these extenders, there's. I used to have an Orbee at my old house. Now I've got these Eros. Are they just complete? They just selling us because we buy it? I can't prove that it works. I can't even prove that it's on. I see a yellow light, it's not working.

[A]

Yeah, I use some Google ones. I agree. It's hard to tell if it really makes your WI fi better or not.

[B]

I just feel like this is.

[A]

I've got two or three of those throughout my house too.

[B]

Is this.

[A]

I really don't know.

[B]

This is the American consumer. Oh, an extender. Yeah. Yeah, I need that. Yeah. Extend doesn't work.

[A]

That is true. I don't know, but think about. I. I've said this before. All the baby boomers in the years ahead, when they. When they get to old age and need to be helped, like, we're going to need. We're literally going to need robots help take care of them in old age because they're never going to leave their house. Right. Like, millennials aren't. Are too selfish to take care of them. Sorry, Millennials is true.

[B]

Yeah.

[A]

We're going to need robots to help take care of people. All right, here's this. This is worrisome to me. A million people tweeted this out. ETF tracker says this. There's 13 new five times single stock ETFs that were just filed. The SEC, AMD and Amazon and Coin and Google and Strategy and Nvidia and Palantir and Tesla and all the companies that you know.

[B]

And Ether. Wait, so what happens on the day that ether felt had a 30 drawdown? Does this five times leverage? Does this. Do you. Do you owe this company? Do you owe the stock exchange money? How does this work?

[A]

I mean, a million people made this joke, but this is the Onion headline of Gillette saying, we're doing five blades. Which they did eventually. But I. Come on, what are we Doing here. This is, this is the kind of thing to me that is going to lead to a flash crash someday. Like, there's taking stuff too far.

[B]

Yeah, yeah, this is, this is crazy talk. I also don't know how much I'm bothered by it. I would want somebody, I would want like natic to say, like, dude, this, this is, this is the type of stuff, to Ben's point, that does flash crash the system because in a vacuum, I don't give a about people gambling because that's clearly what this is. Right. And that's like obviously the world that we live in.

[A]

And so to each definitely be people that use these.

[B]

Now, if this, if this poses like market structure risk, then ban it immediately. To that point, Dave Dondick does weigh in here and he says, if I was making odds here, I suspect that these will be nixed by the SEC staff as soon as they come back to work and clear off their desks. There's a government shutdown, Dave says, but that's part of the strategy, thanks to the ETF Rule 6c11 and recent generic listing standards. As crazy as these filings may seem, they are actually, quote, normal. And Thus, if the SEC doesn't explicitly kibosh them, they go live in 75 days. If this shutdown drags into the end of the year, a whole lot of products are just going to appear without a weather eye. And it will all come down to how conservative Velocity. All right, whatever. This is crazy town. So if their strategy is to sneak it through while the government shut down, and I guess from a business point of view, kudos to them, right? Like, know they're doing business and this is business, but my goodness, if this is where we are, this is.

[A]

Yeah, I don't love it. I, I get it. People are going to do what they want. And the pendulum obviously just keeps swinging. I, I just. If we're going to get the deregulation, can we please make it in places where it matters, especially the housing market? Just, I like, is the deregulation really just going to be. We're going to let people blow themselves up with these different strategies? Yeah, let's make it easier to build houses. Come on. What are we doing here?

[B]

All right, there was a article in the journal China betting it can win a trade war is playing horrible with Trump. Last week, Beijing imposed sweeping restrictions on the export of rare earth minerals, which are vital to consumer electronics in the tech industry. Trump then threatened additional 100% tariffs on China. All right, so China knows what they're doing, right? They're trying to mess with our stock market. They know that Trump is going to cave. I mean, they've, they have seen this movie before. They do know how it ends.

[A]

It's now Taco Day. It's not just Taco Tuesday, it's Taco Seven days a week.

[B]

Yeah. And speaking of China, I just want to make one thing. Last week we spoke about, about, about Beijing versus the United States. The book Breakneck. Who's gonna win? And when I said those people about China, just to be very clear, I don't mean the Chinese people, I mean the government. Right. I'm not disparaging a whole nation.

[A]

Oh, because they control everything. Yeah.

[B]

I'm not dispatching a nation of 3 billion people. I'm talking about the government specifically. And then.

[A]

No, you don't. To say that Cancel culture is over.

[B]

Fine. So I also wish that, So I didn't finish listening to the book while we were having that conversation. And towards the end, they were talking about, like, people defecting and leaving China and not thrilled. What's with what's going on? And I wish. I would like to amend my answer of last week. Like, oh, they're a tough opponent and who knows how it's gonna play out? Who knows what's gonna. I, I, they, they are a very tough opponent. And yes, who knows how it's going to play out.

[A]

Yeah, that was interesting. Basically saying a lot of the people who are well to do and not well to do in China are saying, I, I'm not going to, I can't take this. I'm out of here.

[B]

Yeah. So it's not, it's not like black or white where there's going to be, okay, here's the winner, here's the loser. Like, it's obviously shades of gray and everything else, but, but if I, we're going to win, like, I, how could you just not believe in, in, in freedom and human rights versus a centralized authority, authoritative decision maker that gets to do whatever they want to their people. Like, so, answer amended. We're going to win to these other.

[A]

Here's the thing, though. I, I have faith in the US System as well, but in something like this, in a trade war, they can take pain way more than we can. So in a trade war, I would put my money on them.

[B]

Like, yeah, because they don't give a, they don't, they don't care about their citizens and their, the livelihoods of people.

[A]

The way that we do.

[B]

Some of the stuff that's described in the book is, is truly Horrific. And they, the, the, the ability for them to tolerate pain on their society is next level compared to ours. We cave, as we should.

[A]

Yeah. So the fact that we did cave and it, it's better late than never, I guess. But if you, after reading that, and you and I are still macro tourists, but now I think we consider ourselves like 20 China experts. If you read that, read that book or listen to the book, you, you realize, like, we never had a chance in this trade war against them, the way that they produce products and how far ahead of laughing. Yes. They've been laughing this whole time. So the Wall Street Journal says the US Is tiptoeing away from many of Trump's signature tariffs. Apparently they're exempting a lot of the products because they're goods that the. We can't make in the US and can't produce in the US and duh. Of course this makes. But at this point, then we should just probably take them all back and just like, let's, let's chill here because it does seem like it's all small businesses that are the ones that are dealing with the pain here. The large businesses have the margins. If they're dealing with, they're fine. That's why the stock market hasn't cared as much. Because someone asked, I think my dad asked me a couple weeks ago. He said, man, I guess I was totally wrong about these tariffs because I thought for sure it was going to sink the economy and the stock market if you just look historically how bad tariffs can be. And I told him, like, no, you don't get it. They, they went back on all the biggest stuff that impacted the biggest parts of the economy in the market. That's why they're still having an impact just in different, different ways.

[B]

Totally. And when I say totally, I have to admit I wasn't listening. I was typing. I apologize, that was rude. But I had to, I did have to send something.

[A]

That's okay. The over under for parlay on how many times Michael's going to ignore Ben for this. This episode is set at four and a half.

[B]

Under that. That's one time.

[A]

All right, that's at least two. All right, so there's this chart from the Financial Times showing the heavily shorted. The heavily, Most heavily shorted U.S. stocks have raced higher this year. And it shows the most shorted stock since 2020 versus average US equity returns. And so this is the top 250 stocks that are in a heavily shorted basket with a market cap above 300.

[B]

Million that Justin Liffenmore quote.

[A]

It has not just outperformed recently, it has literally outperformed the entire decade now. It's raised way higher recently. Now, I have, I have two ways of looking at this chart. Okay. One is, man, this stuff is out of control. This is insane. Like speculative, whatever. The second way to look at this is why are hedge funds so bad at shorting stocks?

[B]

Well, there's a third way. There's a third way. Okay, so the first one is. What was the first one?

[A]

This is a speculative. This is crazy. It's so speculative and. Oh my gosh. The.

[B]

So control. Yes. Why are hedge funds so bad at shorting? I know, they're so bad at shorting.

[A]

I think obviously they did not learn their lesson from the Gamestop fiasco.

[B]

Correct.

[A]

That's surprising.

[B]

Correct. All right, so it's a combination of speculation unleashed on society and in trading apps, the likes of which we've never seen. Right.

[A]

Bucket shops, Reddit, Reddit. 1.

[B]

Bucket shops made it very difficult to speculate. And even in the 60s, right, when, when these, these brokerages got just literally they, they couldn't fill all the orders. Remember that? The one was, what was that book, the Go Go Years once in Gokon, one of the John Brooks books.

[A]

Yeah, Go Go Years.

[B]

Okay. The other part of this potion is in a technological revolution like we're in right now, the money losing companies that people would short and say, these aren't real businesses, they get the benefit of the doubt because you are in a believe everything bull market.

[A]

Yeah, right. It's funny though.

[B]

So all of, all of these names like, yeah, this is a speculative bull market with new technologies. The companies aren't making money because what. They don't need to. Right. Like they're, they're just, they're not there yet. It's like that thing. It's in, in, in Silicon Valley. No, no. Revenue is the worst. Don't show any revenue.

[A]

So it's funny though, because I, I tweeted about this and I gave my two things like saying, one, speculation is out of control. Two, hedge funds are terrible at shorting. And Jim Chanos, a famed short seller, replied to me and said even another way to put it. Despite clear outperformance from such stocks, long only managers still generally underperform the market. And it's like everyone loses. But the thing is this, this decade is literally the only people winning are retail.

[B]

Yeah.

[A]

Like retail degen traders or retail just. I'm going to buy what I know. Those are the only people outperforming the market.

[B]

As, as somebody who is not on the other side of those people. You love to see it now. I can't imagine the frustration from the professional investors.

[A]

Fundamental had, I'm guessing like a David Einhorn or something like that would look at balance sheets.

[B]

I can't, I can't, I can't. I can't imagine the pain of. I, this doesn't make sense. I've seen this movie before. I can't imagine what that is like to live through that.

[A]

I'm happy that I, that I don't short selling stocks. Just, it's, you have to be wired differently. I, I would never be wired to try to short anything.

[B]

Oh, no, I'm a sheep. I, I, I need. I can't, I can't take the, the pain of people being mean.

[A]

All right, this is interesting. Let's talk about crypto. This is from Kelsey. They have a bet. Will bitcoin be above $200,000 by 2027? And I think the, the, it's, does it hit that at any point in the year, which is not that far away. And it's essentially, it's a little, it's like 53% say yes, above 200,000 by 2027.

[B]

I feel like that's, that's exactly where the ad should be. It feels like a coin toss, really.

[A]

Like a double, essentially, in the next.

[B]

Two years and a half.

[A]

Two years?

[B]

Yeah.

[A]

You think that should be a 50, 50 proposition? I mean, that seems, those odds seem way too high for a double.

[B]

Okay, then. Bet.

[A]

No, I, all right, I think I.

[B]

I, I mean, if this, if, if it's free money. Ben, pick it up.

[A]

All right. Obviously it's not free money because there is the, the tail.

[B]

Oh, there's that Grand Rapids hedge right there.

[A]

Yes, but I, that, that, I'm sorry, that number should be 25.

[B]

Okay, then that's grossly mispriced, and you should pick up those dollars.

[A]

Yes, I think I will. How's that sound? No, I don't do these prediction markets. Come on. Kind of degenerate. All right, let's talk housing for a second. You just bought a house, so this has nothing to do with your purchase, but I think it's, it'd be really hard to be bullish and, or positive on the housing market right now for a number of reasons. Here's some charts from Redfin. The homes sit on the market a lot longer, so they, this is median days on the market has gone from like 20 to 50, which is a lot. It's going up and to the right. Most houses are selling for under list price these days. The median down payment obviously has hit a record high. This is kind of crazy. So it's $70,000 on a US on a median home these days. This is surprising to me, though. Where's the chart? Oh, I didn't put it in here. But they show that the average down payment is still roughly 20%. I'm surprised people or the median down payment. I'm surprised people haven't lowered that. But listen to this. So this is. It seems to me like it's just the people with. It's a shrinking group of people who are. Can be the buyers. And you mentioned this. You said, like, listen, we had like one or two people check the house out essentially. Right. It was a small pool. So this is from a Redfin article. With the housing market in a downturn, the people who are buying are those who are financially comfortable, secure in their jobs, and have money ready and waiting in the bank for a down payment. Said this guy who's a agent in Austin, Texas. For example, a few months ago, I helped a buyer close on an $800,000 home with a 50 down payment. They were able to liquidate stocks to make a full 400,000 down payment without thinking too much about it. And now their monthly payments are lower. That's the wealth effect right there.

[B]

Yeah. Austin is one of the worst areas of the housing market right now.

[A]

Yes. Texas and Florida sound like they're in a kind of a world of pain. And I don't know, I'm starting to think like the people have. People have decided, like, listen, the prices are just too high in a lot of. A lot of areas. And I'm just going to sit out.

[B]

Okay, I, I am on the other side of this. I don't think it's hard to be bullish about housing. I think that.

[A]

What's your bull case?

[B]

Rates come down, Rates continue to come down. That's it. And it's a whole king caboodle. I don't think it's a down payment per se. I think it's. I think it's the monthly payment. It's just crushing.

[A]

I feel like I've been on that corner for a while now, and I'm, I'm wondering if the, the level of rates is lower than we assume to get people to really. Because rates have been falling this year.

[B]

I think we're right there. Like, I think that, like, once we get to five and a little bit under, I think, I think housing activity can explode.

[A]

All right. I. I've had that same feeling for years now. I'm starting to, like, backtrack on it a little bit.

[B]

I don't know that I'm saying that prices are going to explode higher, but I think that activity is going to. I think activity could moon. I still think that there's a lot of people. I don't think people stopped wanting to be in a house. I think it just became completely unaffordable.

[A]

Think that.

[B]

Go ahead.

[A]

The difference between buying and renting in some places is so wide now that I think a lot of people just said, fine, I'll just keep renting. It's not worth it.

[B]

Yeah, well, that is. That is definitely what happened.

[A]

All right, cool chart from. We. We talk about this all the time. Like, am I rich? Well, tell me where you live. Right, right. Flowing Data has this cool chart where they. They broke out housing costs by state, and it's. Are you paying more or less than the national average? Right. It looks like Alaska and Delaware. Right. At the national average. Of course, places like Washington, D.C. california, NJ, these places are way above. So California is 60% higher than the national average for housing costs. But it's funny that there are more states that are below the average national. The national average than are above it. So the places that are really expensive, California and Hawaii and these places, they pull up the average a lot. It's a huge, huge difference.

[B]

Yeah, it's really good stuff.

[A]

Yeah. Anyway.

[B]

All right, let's do some. Let's do some quarter stuff. I, I do. I keep saying this. I do love hearing from the companies. And we've had people say, like, Michael, you keep saying the CEOs won't lie. What are you talking about? All right. I think what I'm saying is that, is that.

[A]

That's a fair pushback.

[B]

Totally. So let me be. Let me be clear. If they are forced to report every 90 days, the ability for them to hide parts of the story that they don't want you to hear goes up dramatically. Because if you give them 180 days, they can maybe think that they could figure it out. That's human nature. Don't. Don't tell anybody. We'll figure it out. If you report every 90 days and there's cockroaches and you don't tell shareholders you're out, your stock will get crushed, the board of directors will remove you from the position if you lie to your investor so blatantly. So are there a million examples of that happening? Yes, there are. Absolutely. And I think that if you were to, if you were to remove the 90 day increments, that would only happen with an increasing amount.

[A]

I agree. The. The level of analysts looking into things and asking questions, they'd kill you.

[B]

So I only mean that, that CEOs are incentivized to tell the truth only because everything's public. That's all. That's all I'm saying. If they could lie. Oh yes, they would.

[A]

Absolutely. There still will be cases of fraud. But it's, it's got to be so much harder today than it was in the past.

[B]

Yeah.

[A]

To, to, to really fool people.

[B]

Yeah. So. All right. Amex. Amex is just. Amex is in the absolute sweet spot of this K shaped economy. They are a premium product for premium spenders and they are killing it. So their total build business, it's just, it's 6%, 8%, 6%, 7%, 8%. That's year over year growth. And these are not small numbers. And goods and services and travel and entertainment up 9 and 8% respectively in the recent quarter. Here's the chart that we share every year, every quarter. And it just continues to blow the face right off my body. Look at the year over year growth of the younger people. Gen Z is 39% growth. Millennials growing 12% versus baby boomers are only growing 4%. And if you look at a percentage of the total, Gen z is only 6% with 39% growth. That will continue to, to creep up the. The, the percent of the total. But look at millennials, dude. Millennials are 30% of total spending higher than baby boomers.

[A]

Where is.

[B]

How about that?

[A]

Where did you put this?

[B]

It's a great quarter, guys. Total build businesses. The second chart, US Consumer services build businesses I highlighted in yellow.

[A]

Oh, there we go.

[B]

Okay, how, how crazy is this? Millennials are spending more at Amex than baby Boomers, huh? Yeah.

[A]

That is surprising. So a lot of people would say this is, this is bad news, but bad news. That's the bad news that people are spending more on credit. But I.

[B]

This. No, no, no, no, no. Amex is not a credit card. Amex is a charge card and you pay this. Amex people are not. People are not relying on their Amex to make ends meet. That is not what's happening. Until that point. Their credit metrics, no change percentage of card member loans and receivables that are 30p. 30 days past due, 1.3% for the last five quarters. These are. Now again, does this speak to the entire economy? No, these are premium spenders. But Net write offs, too. There's nothing here. People with money are continuing to spend money, but look at their net card fees. Ben, look at the next chart.

[A]

Yeah, I know because I pay them.

[B]

So it was, it was $1 billion in Q3, 2019, and now it's $2.6 billion.

[A]

I wonder how much of that is the annual payments.

[B]

That's what this is. That's what this is. That's.

[A]

By the way, speaking of credit cards, this is another one that was. Do you remember how many news stories there were about when the US credit card debt hit $1 trillion? Oh, my gosh. A trillion dollars in credit card debt.

[B]

What's it now?

[A]

1.2 trillion. It's at 1.2. This is from Y charts as of Q2, 20, 25. And guess what? I actually view the increase in credit as for most people, like you say, it's probably a positive because they're feeling good and they're okay. And you're right, most of them pay it back off. So it doesn't, it doesn't matter that much.

[B]

Right.

[A]

It's an expansion of the piece of.

[B]

Right. All right, so let's talk about bank of America, a company that serves more or less Main Street, Main Street, America. Right, bank of America. All right, look at their asset quality net charge offs and their net charge off ratio. Is this going higher or lower, Ben?

[A]

It's falling.

[B]

Total net charge offs of $1.4 billion decreased by $158 million from the second quarter.

[A]

Plus look at how tiny the percentage is.

[B]

It's nothing. Provision for credit losses also down. And if you look at, if you look into consumer net charge offs and you look at credit cards falling, Ben, in the first quarter of the year is 98. Basis points down to 90 now down to 82. I'm sorry, I. I know that there are people struggling broken horse here. There always are.

[A]

But you say broken horse.

[B]

Broken horse. Broken dead horse. Beating the dead horse. Broken wheel.

[A]

You just put broken arrow.

[B]

Broken arrow. Broken arrow. That's what I meant to say.

[A]

I think you combine broken record, dead horse. Nope, I can't remember. I. We do so many podcasts, sometimes they all merge together. But you asked someone a few weeks ago, like, if you had one indicator in a few years to know if you're right or wrong, what would it be? And I feel like for you credit card companies, that's your indicator.

[B]

I feel like if this is it, I don't, don't. I don't care about the stories in the Journal that are Interviewing random people. Show me the data.

[A]

Right. We found this one person who is struggling because they have a low income. Of course you did. There's a lot of them.

[B]

Show me the data. And matter of fact, somebody sent us a video that I watched. It was on PBS about the K shaped economy. And it's, it's, it's Santa. I. Hearing these personal stories from people, like on an individual person basis, it's, it's horrible. I hate that there are people struggling. That's not unique to today. There are always. But if you look at the aggregate data, it is not showing what they want you to believe.

[A]

So I just put the finishing touches on my new book. I'm handing in the edits this week. It's done going away. It's going to come out in the spring. And I write about the Great Depression a little bit in there. And even after the Roaring twenties, which is like the biggest, one of the biggest booms for retail households ever, like, they got all these new, fancy new things in their houses and they borrowed on credit for the first time. By 1929, at the peak after the great decade, it was one of the better decades we'd had. At that point, 60% of US households were below the poverty line. So like no one, no one had any money. And so it's, it's like you sit, people point to these things and obviously it is sad, but it's an improvement on the past, which is hard to wrap your mind around sometimes.

[B]

Yeah. Speaking of the past, one of the books that I'm listening to, I'll talk about it maybe next week if I finish when I finish it. Historical records and all these historical books you mentioned, the 1929, you know, where a lot of the qualitative, the good stuff comes from. It all comes from diaries, right?

[A]

Yes. People kept track of stuff.

[B]

Right. Like my grandfather had a diary. We found them when he died. And reading them was actually pretty brutal.

[A]

Yeah. You know what our diary is called? Twitter.

[B]

Yeah. The, the, yeah. Prior generations did not have easy lives.

[A]

You're like great grandchildren gonna be like, wait, my dad, my great grandfather created this pie chart.

[B]

Yeah. He was just posting all. Well, well, for, for a period. He wasn't.

[A]

Then he grew up. I mean, I, The Hamilton one, all of it, it's based on letters they wrote to people. Yeah. It's. It is kind of crazy. That's how people. Because they had, they had nothing else to do. What else are you going to do besides write a letter at night by candlelight?

[B]

You know how TV you know how.

[A]

People had nothing to do.

[B]

Bill Simmons always talks about, like, future generations are going to think Karl Malone was the greatest power forward of all time. And that's why he created this sort of line in the sand, arbitrary metric that cuts off Karl Malone. I wonder if future generations are just going to, like, look at headlines as the arbiter of truth. Like, just. They're gonna look at Google searches and newspaper articles as if that represented the. The reality of what was happening.

[A]

I think history is going to be rewritten a million times because there are so many opinions now. I think in the future, people are going to be able to look back and pick and choose, and they're going to be able to create the history that they want. So it's. History is going to be very hard to discern going forward.

[B]

It'll be a choose your own adventure. Speaking of that, I had this. I had this really dumb, obvious, not profound thought the other day about. Because Kobe. Kobe is reading Goosebumps. I told him to get. See if those books were still around. So he got one of the ones. And I was like, oh, man, I remember this from my childhood. Yeah, books don't disappear, obviously. Right? We're reading books that are hundreds of years old still. But I was like, oh, wow, Goosebumps is still around. Yeah, of course it's still around.

[A]

No way.

[B]

Yeah. All right. This is a. This is a. This is a tweet on the Internet from Boring Biz Underscore. People wildly underestimate how hard it is to be wealthy. The bull market has cooked everyone's brain. And reality is that almost people, that most people will not come out wealthy on the other side, many will be stuck as our paper wealth evaporates. Being sustainably wealthy is grueling, requires years of hard work and building up skills and relationships. The people trying to tell you that, that you can side hustle or day trade your way to wealth are selling a complete lie. I agree with most of this. I fully agree with that last sentence. I do. I think that most people will not come out wealthy on the other side. Depends what the other side looks like. So you could, you could, you know, quibble with that maybe on. On where the market is in a couple of years. But the people, the people trying to tell you that you could side hustle or day trade your way to wealth or some complete lie. Amen, brother.

[A]

I agree with that. I actually think. I disagree with the first part of that. I think it's never been easier to be wealthy than in the past. We Talk about the, the Vanderbilt stuff and them squandering it all. That would never happen today. I think there are so many experts and advisors and consultants and lawyers these days. If you're an extremely wealthy person, it's never been easier to hold on your wealth.

[B]

Yeah, yeah, yeah. I guess he's probably talking to like the self directed young men.

[A]

Yeah.

[B]

That are 23 that think that like they are going to be wealthy for the next forever and ever. And I think for that cohort. Yeah, he's right.

[A]

Yes. Right. And yeah, the paper wealth thing, it's true. It's not real until you, until you make the sale. Right.

[B]

Yeah.

[A]

On the other side though, you can say, like, listen, if I don't sell, I don't lock in the loss. Right.

[B]

Zero. Am I right?

[A]

All right. This is not speaking of wealth. Our colleague Patrick Haley shared this. I think it was a Boston Globe article talking about how to deal with like cognitive decline as you get older and health problems and how, how are the baby boomers going to deal with this? And they show this chart that shows wealth and death gap of US adults over 60 and it breaks it down by people over 60 and what part of the wealth cohort they're in. And so the top 10%, the death rate is 11% and the average age of death is 85. If you go down to the bottom 60, 80%, the death rate is closer to 20% and the average death age of death is 79. So as you go lower down the income scale or the wealth scale, the death rate increases and the average age of death is earlier. This is a crazy chart, is it not? This is nuts.

[B]

Yeah. Also what you would. The numbers are startling, but also what you would probably expect.

[A]

No, I guess I just didn't expect the gap to be that large and that. So the bottom 80 to 100, the average age of death is 76. If you go up to the top 10%, the average age of death is 85.

[B]

Yeah.

[A]

Nine year difference. That's crazy.

[B]

It is.

[A]

All right, we got to talk about $50,000 cars. This is just my beat, I guess, because a million people sent me this story about how the average price of a car is now $50,000 according to Kelley Blue Book. Adding to the sticker shock, more than 60 models had average prices of more than $75,000. Insane. How much of this is attributable to inflation, which is obviously big. And I think the average price of a new car is up 25% since beginning of the decade. Right. And then we have all these new sensors on the cars and the cameras and so like the Apple carplay the screens, there's more stuff in them. So in that, in that sense it makes sense cars would be more expensive. But how much is this? How much of this is also just people buying trucks and SUVs as opposed to sedans. Like I'd love to know what, what percentage of that increase is because of that. It's got to be a big part of it. I, I suppose you can still get an Accord for I don't know, 35, 38 something.

[B]

So Arbor data and science wrote about this. They, they write the average age of the US passenger cars on the road up until the right since 1995 was 8.4 years. Now it's 14.5 years. They also say that the Toyota Camry, the bestselling car in the US is more affordable than ever. They show it adjusted for the median hourly wage. It used to take 1600 hours. Now it only takes a th000 hours.

[A]

That's it. That's very interesting.

[B]

But, but here's the other thing that I was thinking about. Yeah. 50,000 for the average car does sound nuts. I think that a lot of the SUV's are pulling this up and maybe some of the high end cars are pulling this up.

[A]

Yeah. It said the luxury vehicles definitely are pulling it up.

[B]

All right, but think about it this way. Because cars are on the road longer than they ever have been because cars have so many more pieces of technology and gadgets and are more durable. It's sort of like the stock market. Like yeah, the multiple is higher. It should be higher. It's better companies. Is it not the same exact thing with the cars?

[A]

Right.

[B]

The tech not with standing the piece of that I drive. But. Oh, and speaking of pieces of. So my, my car is. My lease on my Wrangler hybrid is up in April. So called my broker or texted him and said hey Steve, I've got a. I'm like six months out. Can I, can I get out of this now? Like the summer's over. I'm not going to take the roof down. I want to get out. He goes, maybe what's your VIN number and how many miles you got? He goes, Nope, you're 10,000 underwater. He goes, he goes, you're paying the lease off and then you get a new car.

[A]

All right, not to throw shade here. Is it time to fire your car broker? Because every time you get a new car, you're underwater like immediately.

[B]

No, these, this is an insane amount of Money. This had nothing to do with him. All right.

[A]

On the other way, Duncan, Duncan sends us that a new Accord starting MSRP is 28,002 95. There you go. So you, you drive a car along. If, if this concerns you, you drive a car longer or you get a sedan or so. Like there are ways around this. If, if that number is sticker shock is so big for you. But I'm guessing most people will just say, screw it, I'm taking an 84 month loan now. I don't care.

[B]

Okay.

[A]

That's where probably most people land.

[B]

Other part of the car story is headlife in Bloomberg. Underwater car loans had four year high and new signs of distress. Just over 28% of trade ins toward new car purchases carried negative equity, the highest level since the first quarter of 2021. According to. Okay. The amount owed on those so called underwater loans was $6,900. Not nice. In the latest quarter, I think that a lot of this was supply chain Covid issues. I also think, hey, guess what? Headline writer back. It's not even where it was in 2019. And was anybody writing about this story in 2019? Did anybody care about underwater cars in 2019? Nope.

[A]

Yeah. Aren't most cars underwater by definition? You drive it off a lot and it's 20 less than when you had.

[B]

Exactly. Ben, it's not even where it was in 2019.

[A]

Right? Oh yeah. So in 2019 it was 34.

[B]

Yet here we are. And I'm not mad at journalists. I know I've been like hard on them. Like I. This is the business, okay. And we all deal with what. What?

[A]

You're right. No one was talking about this in 2019.

[B]

It wasn't a story at all. Nobody gave a. And in fact, getting back to why I enjoyed listening to the company call so much. Ally kind of exposed to the auto market. So Sanjay Sakurani and analysts asked. Okay, obviously lots of jitters around some of the cracks that we've seen in subprime auto and just broader consumer credit trends. Michael, it seems like your metrics don't necessarily suggest a lot of that. Okay. So the CEO said, I appreciate there's a lot of macro uncertainty in the environment, but we're not seeing that impact our credit performance. And so we feel good about where we are where what we're seeing right now. Credit performance day to data. Okay, look at the net charge offs. Do you see anything there? Is it going up to the right or is it going down to the right? Look at the delinquencies. Ben is it going up or is it going down? This is the. This is one of the biggest. Some prime lenders in the world.

[A]

No, just wait. Hasn't happened yet. It's going to happen.

[B]

So. Okay. I saw this morning on Instagram an image of somebody who looked a lot like Rocky on the beach running with the dog from Rocky. And it said, oh, I play Rocky. And I said, no, no, no, no, no, no, no, no. We're not doing this. We are not doing this. I don't want a remake of Rocky. No. Hard. No. And good news, it's not a remake. It's. It's the making of Sylvester Stallone making Rocky. And that I'm in for.

[A]

What documentary? Okay.

[B]

Yeah, yeah.

[A]

All right.

[B]

That I'm in for. All right. Danielle tweeted. I can't believe it's been two years since we brought in audiobooks. Premium Spotify audio listening hours up 37% year over year.

[A]

It does feel like I've unlocked a new form of learning in my life with audible.

[B]

How.

[A]

Really feels good. Yeah, it does. It feels so much better than listening to most podcasts. A lot of the garbage I listen to. I still have some garbage that I listen to because I listen.

[B]

I listen to Sean and Chris talk about the best horror movies of 2025, and I loved it, and I do love it, but it feels nice to mix in a little bit of education every now and then. All right, two quick things. I know we're running long here. Sorry, Duncan and team. So I got the house that I bought. There's a bar in the basement area, and we don't really have, like, a place for the kids to play. There's no, like, there's no. That. That is the basement. There's no up. You know, so the great thing is.

[A]

Eventually the kids graduate from play areas. We took the play area and gutted it and turned it into a media room.

[B]

Yeah, Didn't.

[A]

Didn't need it anymore.

[B]

Yeah, I can't wait to get there because I'm. I'm going the other way right now. So there's a bar in the middle of the room, and I love it because I love alcohol and I love the look of it, and I. I want it to be my bar, but it's not my bar. We're getting rid of it. So. All right. What?

[A]

No. You're getting rid of your bar?

[B]

Getting rid of.

[A]

Tell Robin to call me. You can't get rid of the bar. Sorry.

[B]

I lost this battle. So we got two quotes. One of the people we know is A little bit more expensive. And the other guy just wasn't getting back to us. So I'm like, all right, well, go with this person. It seems like, I guess, sort of reasonable. $5,500 was the quote that he gave us to get rid of the bar and clean up and paint it, whatever. And then the other guy just got back to us this morning. Eighteen hundred dollars. And I said, well, because we just gave the other guy $2,000 deposit. And so I went to chat GBT and I copied and pasted. And I said, tell me the difference between these two contractors is some. Why is there such a discrepancy in the prices? One promising to deliver anything more than the other person is. And it worked amazing. It was perfect. The output was freaking perfect. So, anyway, now I gotta call this guy and be like, dude, I need my money back, and. Or you gotta lower your price dramatically.

[A]

Oh, so it didn't say, like, this other guy is. Is ripping you off.

[B]

He was. So the one the higher price is two and a half times. It's $1,800 versus 5,500.

[A]

Right. That's a big deal.

[B]

It's a big difference. So. All right, I'll let you know how that goes. I'm a little bit nervous to be, hey, I need my money back, but I'm going to do it. All right, Ben, you would just say, it's fine, keep my money, right?

[A]

No way.

[B]

All right. I am done with pumpkin farms. I'm done with pumpkin farms. I'm just done.

[A]

Oh, thank you. It's. They. They get bigger and grander every year, don't they?

[B]

It's just enough towards the end, I'm yelling at R. I'm like, just take the pumpkins. I. I'm done. I want to go home.

[A]

And then everyone's got to take the Instagram pictures next to the. Whatever.

[B]

She's 100ft behind me. I'm online. There's people that are now behind me online. And now I have to let them go in front of me because Robin's not coming. She's with the kids. And I'm, like, letting people go. And I just get off the line and I'm mad. I'm like, I. Screaming. She goes, you sound like a crazy person. I'm like, yeah, I want to go. Been here for long enough.

[A]

I hate those places, too, kids. But here's the thing. We. We've been so busy with kids sports, we just realized this morning, my kids go, wait, we don't have pumpkins yet. And my Wife going, oh, my gosh, you don't pump.

[B]

I'm jealous.

[A]

And we just realized that we have no time to go to a pumpkin farm. And I'm going, yes, it's awesome. Yes. I. I'll get them at the grocery store. Don't worry. Who cares? Yeah, we're going to throw them out anyway. All right, before recommendations, real quick. Paul Warner on Blue sky said, looking to differentiate this, this a new system. Halloid, which is the original name of Xerox, hired a Greek scholar at Ohio State University and coined the term xerography from two Greek roots meaning dry writing. Hallowed changed his name to hallowed Xerox in 1958 and Xerox in 1961. So they literally made up. They literally did make up a word. Xerography wasn't a thing.

[B]

Huh? Good for them.

[A]

Yeah. All right. Recommendations. I got a lot this week. God, I watched. I like me the John Candy doc on an Amazon Prime. John Candy was my guy.

[B]

Yeah.

[A]

Okay. I think Uncle Buck is one of the greatest movie characters of all time. It's one of my top 10 favorite movies. Planes Trains Automobiles is obviously one of my obvious favorite movies too. And it's just, it's so, so good. It's very sad, too, in a lot of ways at the end. But it's crazy how in the 70s, there was a group of people that got together in Chicago and Toronto and it was like Martin Short and Bill Murray and Harold Ramis and Catherine o' Hara and Dan Aykroyd and Eugenia Levy and John Candy and all these people just happened to be coming up at the same time together. And it's kind of like one of those lightning in a bottle moments. But it was so good. And you, you got to see all the, like, how good of a guy he was and all the different parts he played and everything he was in was good. I, I summer rental and great outdoors, and he had the small parts in, you know, vacation and Home Alone. And I was a big John Candy guy. Love him. It was very, very good.

[B]

I think I want to watch it. I'm not as, as big on. On him as you were, but I love that you love him. And I want to watch it.

[A]

Uncle Buck is probably one of the movies I watched more than any other in my life. And I, I introduced to my kids a couple weeks ago, and they, they loved it too.

[B]

Is there one in the, in the woods that you've mentioned with him and Dan Aykroyd, or is it just Dan Aykroyd?

[A]

No, that's him. That's him. And Dan Aykroyd, the Great Outdoors. That's a great summer movie. Great. Dan Aykroyd plays the shooter guy from Chicago. Very, very.

[B]

No, it's so interesting. So because you're just a few years older than me, like, your. Your window of movies of your childhood movies is, like, fairly different than mine, at least on the early side. Like those 80s movies. Like, I just missed them by like a year or two.

[A]

Yeah, that makes sense. Like the whole. I remember seeing the preview for Home Alone and going, oh, my gosh, this Uncle Buck too, because it was Macaulay Culkin and realized, oh, that's a kid from Uncle Buck. Okay. I also introduced myself, my kids, to Tremors this week.

[B]

Kevin Bacon, classic.

[A]

My son.

[B]

Wait, why Tremors? It's so random.

[A]

My son loves that kind of cheesy action stuff. Tremors was one of my movies too, growing up. I don't know why it was. Tremors was just. I watched it all the. Anytime it was on usa, I watched that. And my son watched it like three times last weekend. He loved it. And it. It just. It's. It's one of those movies that shouldn't work. It should be way. If it was made today, it'd be way cheesier than it is. But it just. I don't know, something about that movie. It's so good. And you being a horror guy, you should love that movie.

[B]

I like Traverses. It's so kids don't know what it was like to watch a movie on usa.

[A]

Oh, yeah.

[B]

It's like, all right, this movie's three hours with commercials, and you're just gonna sit here, right?

[A]

And the swear words are bleeped and. Yeah. All right, one more. Another movie I watched all the time was on Rewatchable, so I rewatched it again since it was Robert Redford Month. Sneakers. They ever watched Sneakers before?

[B]

I never watched Sneakers, and I never saw the Natural.

[A]

Okay. We. My daughter and I sat down to watch the Natural this week, too, and I. I said, he's like Otani on the Daddy's, basically in real life. But Sneakers is another one of those 90s movies that I watched all the time. My mom and I loved that movie. And it's just a great, like, Spy. And it's. It feels a little dated now, but it's in the cast of that is Dan Aykroyd's in that as well. It's amazing cast in that movie. Great movie. And I think Robert Redford, my. Does he has People always talk about, like, James Earl Jones and Morgan Freeman. I think Robert Redford has one of the best voices ever.

[B]

Oh, yeah?

[A]

How's that? Because he. He did the voiceover for River Runs through it too. He's just got a great voice.

[B]

Did you finish task?

[A]

We didn't do it yet. I was watching the Lions game last night.

[B]

Okay.

[A]

What do you think about the finale?

[B]

Great. So just HBO is just better than everything else. I mean, obviously Ruffalo. Oh. So there was a. There was a. Not spoiler. There was a scene at the end in the courtroom where Ruffalo just was amazing. Amazing acting.

[A]

The acting in that show was. Is amazing.

[B]

The character Maeve, I thought was the strongest.

[A]

She was good.

[B]

The dude who played Robbie, I forget his name was excellent.

[A]

Yeah, he's the guy from. He was in Ozark. Yeah, I think he's fantastic.

[B]

Yeah, it was. It was a very good show. And I love. Because I even do think that episode six and seven had quite a bit of fat in it. Like more character stuff than I. Than I love. But I love those seven episodes.

[A]

Yeah.

[B]

Love that.

[A]

That's pretty. Yeah.

[B]

Oh, I'm okay. I almost forgot about this. I saw. I saw one battle after another.

[A]

Okay.

[B]

All right. It was a good movie. It was a very good movie. It didn't drag. Even though it was very long. It wasn't like. It wasn't like I didn't fall asleep. I wasn't bored. But. But. And there's some. There's some. Some great stuff in there. Some really cool camera stuff that the film nerds love. And it was a good movie. It just was. It was it. 170 million dollar budget, good movie. Wild. But I just. People love pta and I don't get it. And I don't want to be a hater because I like the movie. I really did. I really did.

[A]

So it's like a 7 out of 10, maybe?

[B]

No, it's better than that. I would say, like, it's like a seven. Four. Like it's a good movie. It is a good movie.

[A]

You're right. That's why I told you. Can't trust the film nerds anymore because they. They're blinded and they just say everything is the greatest thing they've ever seen.

[B]

I just. The. The pd, The PTA adoration. Now I'm just a movie guy. I'm not a film guy. So I just don't get it.

[A]

Yeah.

[B]

All right, last. All right, real quick, let's run through this. It's Halloween season, so I did Come up with my 10 favorite horror movies. Now, this is no particular order and I, to be honest, I didn't spend a ton of time on this. So is this the definitive finalist? No, but it's my list and there's no. Nothing obvious in here. Okay? No Friday 13th, no Halloween, no Scream, no Blair Witch. No the Ring. Like, I don't there's any movies on this list. In fact, there are no movies on this list that did like $50 million at the box office. So nothing mainstream. Okay, here we go.

[A]

It. These look like names that you all could have just made up and I wouldn't have known that any better.

[B]

Now, I do love found footage. I love a good found. They just scared the bees out of me where it's either either found footage or when they hold the recording. Yeah, fat footage. I guess that's what it is. Dead Stream was one of those host. Host they did during the pandemic. It was. It was a zoom call with. With five teenagers and things went awry and that scared the hell out of me. Speaking of hell, Hell House llc. Hell House llc. Great one, Great one, Ben. I think. I think you might like that one. All right. I saw this movie when it came out in 1995. I've. I've spoken about on the podcast before. What year was this? 94. Insane. My dad took me to the sea this when I was nine and this movie gave me nightmares for months. My mom was very upset that I saw this in the Math of Madness is a John Carpenter movie with Sam Neill. You ever hear of it?

[A]

No. It sounds like it could be a porno though.

[B]

So the concept is Sam Neill is see an agent, a literary agent. I don't even know. But like this. This author, this famous horror author goes missing and they go to find him and they get wrapped up and like he's writing the movie. It's very meta, very good. All right. Vhs, similar to Hell House. While there's multiple of them, VHS has also found footage. One, the most recent one is a Halloween version. There's probably five or six of them. Always slap. All right. And then the next few are demented. The Dark and the Wicked. The Dark and the Wicked is quite dreadful. Just. Just hurts to watch. Borderline painful. Speak no evil. Not the American version. Not the American version. Not the American version. Green Room. I don't know if Green Room is horror per se, but I don't know what other genre you would put it in.

[A]

Okay. I actually tried to watch that. I couldn't make it through it very.

[B]

Gnarly, I would say grizzly. That's, that's grizzly. Eden Lake, also a grizzly movie that is with Beth from Yellowstone. And lastly, perhaps the, the cake taker of demented films is When Evil Lurks. I think that was an Argentinian one, but I'm not 100 positive.

[A]

Okay. Green Room is the only one I've ever heard of here, Argentinian horror. And well, you said you're not a film guy, so here I, I had a realization this weekend. We went to one of those horror things in the woods, right, at our local ski place. And it was a, it was a path you followed and it was, it was meant to scare you, right? And so we went with my daughter and her two friends. They're 11 and people jump out and the people dressed up were really, really spooky looking. It was very well done.

[B]

I don't like that. That's too, that's too much.

[A]

See, I wonder. But so like, honestly, I had zero. I was, my daughter's like, why are you laughing? I was laughing at what I was going through. It didn't, nothing scared me. It didn't do anything for me. And my daughter and her friends are freaking out, right, because they're jumping out and they have cleavers.

[B]

I, I, I'd be terrified. I, I get very scared at hard movies.

[A]

So I think that's why you like, for, for whatever reason, the, the horror thing doesn't do anything. Like, it doesn't bring about any emotions for me at all. And that's why I don't like these movies.

[B]

All right. You're not alone. I just, I find it bizarre, personal.

[A]

Yeah.

[B]

Any for me? I, there's often times, in fact, I would say 90% of the time where I will either have to like mute it while I'm watching. Like, I prefer to watch Halloween during the day because I get very, I, I close my eyes, I get scared. And maybe that's why I love it.

[A]

See, that's it. For whatever reason, it just doesn't hit me that way. So to each their own.

[B]

Okay? Credit to you.

[A]

That's why there's, that's, that's why There's a market. Itemshop.com we have a brand new animal spirits mug for the fall for all those hot chocolates, coffee, tea. Right? Very well done. Thanks to the production team as always. Duncan, Dan, John, Travis, who else am I forgetting? Nicole, Rob, Graham. Appreciate you all. Email us, Keith animalspiritscompoundnews.com and we will see you next time. Good.