We Have to Talk About Sports Betting (EP. 417)

Summary

Animal Spirits Podcast Summary: "We Have to Talk About Sports Betting (EP. 417)"

Podcast Information:

• Title: Animal Spirits Podcast
• Host/Author: The Compound
• Description: Animal Spirits is a show about markets, life, and investing. Join Michael Batnick and Ben Carlson as they talk about what they're reading, writing, listening to, and watching. New episodes every Wednesday morning.
• Episode: We Have to Talk About Sports Betting (EP. 417)
• Release Date: June 18, 2025

---

1. Introduction and Overview

In Episode 417 of the Animal Spirits Podcast, hosts Michael Batnick and Ben Carlson delve into a variety of topics ranging from market dynamics and investment strategies to the burgeoning realm of sports betting. The episode is peppered with insightful discussions, personal anecdotes, and expert analysis, providing listeners with a comprehensive view of current financial landscapes and societal trends.

---

2. Ritholtz Wealth Management's Expansion into Tax Services

Michael Batnick reflects on Ritholtz Wealth Management's strategic decision to incorporate tax services into their offerings. Initially hesitant due to concerns over liability and uncertainty about the benefits, Batnick acknowledges that the move has proven to be a significant asset both for the company and its clients.

"Chris was 100% right. I was 100% wrong with my reservations. It's been an incredible asset for our company and our clients."
— Michael Batnick [02:05]

The team, led by Bill Arts, has grown to include six or seven professionals dedicated to tax services, highlighting the firm's commitment to comprehensive financial solutions.

---

3. New Initiatives: Future Proof and the "Talking Wealth" YouTube Channel

The hosts introduce Future Proof, an annual festival where The Compound shifts focus from fintech demos to artificial intelligence (AI) innovations within the wealth tech sector. This year, they are specifically seeking AI-driven solutions, emphasizing the transformative potential of AI in their industry.

"We want to talk about AI. We want to see what you're cooking up. This is the future of our industry."
— Michael Batnick [03:40]

Additionally, Batnick announces the launch of the "Talking Wealth" YouTube channel under their Unlock series. This platform aims to explore various facets of the wealth management industry through interviews and discussions with experts like Phil Huber and Dave Nig, particularly focusing on the intersection of AI and financial advice.

---

4. Market Sentiment and Household Equity Allocations

A significant portion of the discussion centers on the shift in household asset allocations. Ben Carlson presents a chart indicating that the average household's equity allocation has risen from 30% during the Global Financial Crisis (GFC) to 53% currently.

"Equity keeps coming, rising to higher highs. If you do an average by decade allocation to equities, this is the new normal."
— Michael Batnick [10:47]

This trend suggests a permanent shift towards greater equity investments among households, driven by the democratization of the stock market through mechanisms like auto-enrollment, ETFs, and zero-commission trades.

---

5. Valuations and Market Fundamentals

The hosts engage in a nuanced debate about high valuation metrics in the current market. Ben Carlson cites instances of exceptionally high price-to-sales (P/S) ratios, such as Palantir trading at approximately 70x sales, questioning the sustainability of such valuations.

"I'm making the case that valuations don't really matter anymore."
— Ben Carlson [11:44]

Michael Batnick counters by emphasizing the underlying fundamentals that justify these valuations, such as robust operating margins and accelerated revenue growth among top-performing companies.

"We're talking about margins for growth companies as high as we've ever seen and accelerating."
— Michael Batnick [13:02]

This exchange underscores the complexity of evaluating current market conditions, where traditional valuation metrics may not fully capture the growth potential of leading firms.

---

6. Retail Sentiment: Schwab's Stacks Index

Michael introduces Schwab's Stacks Index, a proprietary behavioral-based index designed to gauge retail investor sentiment. While historically correlated with market movements during periods like the COVID-19 pandemic and the 2021 bubble, recent readings indicate a disconnect between the Stacks Index and the broader market.

"Nvidia was the number one sell in May. Isn't that wild considering how strong tech stocks have been?"
— Michael Batnick [16:55]

Ben Carlson notes that despite strong performance in tech stocks, Schwab clients have been selling, possibly reflecting profit-taking behaviors or a divergence between different investor groups.

---

7. Stock Volatility Trends

Drawing on a compelling chart shared by Grant Hawkridge, the hosts explore the increasing volatility in the stock market. The chart illustrates that the 2000s are on track to be the most volatile decade in market history, characterized by numerous 1% up and down days.

"The S&P 500 is up over 80% since 2020. Big moves, big gains, not the combo we're used to."
— Michael Batnick [25:22]

This heightened volatility suggests that the market is experiencing more rapid and significant fluctuations, challenging traditional investment strategies and risk assessments.

---

8. AI's Impact on the Economy and Employment

A substantial segment of the episode is dedicated to discussing the potential repercussions of AI advancements on the labor market. Ben Carlson raises concerns about job displacement and its cascading effects on consumer spending and overall economic health.

"If many of the jobs disappear in labor markets start to show massive amounts of unemployment, where will the relentless bid come from?"
— Ben Carlson [28:09]

Michael Batnick acknowledges the uncertainties but speculates that some job losses might be mitigated by increased productivity or the creation of new roles, although he concedes that the future remains unpredictable.

"Who knows, right? I don't know where this is going to go."
— Michael Batnick [30:18]

This dialogue highlights the dual-edged nature of AI—while it promises efficiency and innovation, it also poses significant challenges for workforce adaptation and economic stability.

---

9. Media and AI: Google's Influence on News Outlets

The hosts discuss the profound impact Google's AI tools have had on media companies, exemplified by Business Insider's drastic reduction in staff due to a 55% decline in organic search traffic from April 2022 to April 2025.

"Google is shifting from being a search engine to an answer engine,"
— Nick Thompson, Atlantic CEO [42:33]

This shift underscores the vulnerabilities media outlets face as AI changes how information is accessed and consumed, necessitating strategic adaptations to survive in the evolving digital landscape.

---

10. Sports Betting: Popularity and Potential Issues

In line with the episode's title, Batnick and Carlson address the rise of sports betting platforms like Polymarket, FanDuel, and DraftKings. They explore the addictive nature of these platforms, their growing popularity, and the challenges in regulating a system engineered to entice continuous betting.

Ben Carlson cites a study indicating that a small percentage of bettors account for a large majority of sportsbook revenue, raising concerns about problem gambling and its societal impacts.

"87% of bettors accounted for a total of 1% of sportsbook revenue, which means that the vast majority of betters are able to play safely."
— Ben Carlson [44:33]

However, the remaining percent who contribute disproportionately to revenue may be adversely affected by addictive behaviors, prompting discussions about the feasibility of implementing effective regulatory measures.

---

11. Cryptocurrency: ETFs vs. Exchanges and Spread Issues

The conversation shifts to the challenges within the cryptocurrency market, particularly the significant spreads observed on platforms like Coinbase.

Michael Batnick highlights the inefficiencies in trading Bitcoin on exchanges where the bid-ask spread can be substantial, making ETFs a more attractive option for many investors.

"Bitcoin is way more liquid now than it was. I understand this happening in 2014 and 2017 at the beginning when it was still this new thing."
— Michael Batnick [50:06]

Ben Carlson concurs, noting that while using limit orders can mitigate some spread issues, the persistence of wide spreads suggests underlying inefficiencies that ETFs are uniquely positioned to address.

---

12. Housing Affordability and Mortgage Trends

Addressing the housing market, Ben Carlson discusses a notable increase in the proportion of income households spend on mortgage payments—from approximately 12-15% pre-pandemic to 24-26% currently.

"We're talking about a huge jump. 25 to 26% of your income."
— Ben Carlson [53:46]

He attributes the lack of widespread public outcry to the majority of homeowners benefiting from mortgage rate stability and increased income, which contrasts with the minority struggling with affordability. This disparity underscores systemic fairness issues within the housing market.

---

13. Private Markets: Yale's Private Equity Sales

The hosts examine Yale University's attempt to divest portions of its private equity investments, reflecting broader pressures on large institutional investors. This move highlights the liquidity challenges inherent in private markets, especially during times of financial strain.

"Yale is rushing to sell private billions in private equity investments."
— Ben Carlson [57:04]

Michael Batnick elaborates on the complexity of private equity returns, distinguishing between Internal Rates of Return (IRRs) and actual compounded returns, emphasizing the often misleading nature of IRR metrics.

---

14. Consumer Confidence and Wealth Distribution

Examining societal trends, the podcast touches on Gallup's American satisfaction survey, which has plummeted to below 40%, a stark decline from the 70% satisfaction levels of previous decades.

"In the 80s and 90s and even the 2000s, it was regularly 70%. It's now at below 40%."
— Ben Carlson [61:00]

This drop is contextualized within discussions about wealth concentration, with the top 1% owning 51% of stocks compared to the bottom 50% owning merely 1%. Such disparities contribute to the declining overall satisfaction and highlight the entrenched inequalities within the economy.

---

15. Additional Topics: Email Etiquette and Personal Anecdotes

While primarily focusing on financial and economic topics, the hosts share personal stories and minor pet peeves, such as frustrations over email etiquette and punctuality in personal interactions. These segments add a relatable and human dimension to the episode, fostering a connection with listeners beyond purely financial discourse.

---

16. Gold as a Reserve Asset

Concluding their financial discussions, Batnick and Carlson note the growing prominence of gold as a central bank reserve asset, surpassing the Euro in importance. This trend is driven by record purchases and surging prices, signifying a shift in central bank strategies amid economic uncertainties.

"Gold is now the second most important reserve asset for central banks, overtaking the Euro."
— Michael Batnick [64:35]

This development is linked to broader concerns about deficits and the perceived stability of traditional fiat currencies, positioning gold as a hedge against economic turmoil.

---

17. Conclusion

Episode 417 of the Animal Spirits Podcast offers a multifaceted exploration of contemporary financial issues, blending market analysis with societal observations. From the evolving landscape of private equity and cryptocurrency to the rising challenges of sports betting and housing affordability, Batnick and Carlson provide listeners with a thoughtful examination of the forces shaping today's economy. Their balanced perspectives, enriched with expert quotes and data-driven insights, make this episode a valuable resource for investors and enthusiasts seeking to navigate the complexities of modern financial markets.

---

Notable Quotes:

• "Chris was 100% right. I was 100% wrong with my reservations. It's been an incredible asset for our company and our clients."
  — Michael Batnick [02:05]

• "We want to talk about AI. We want to see what you're cooking up. This is the future of our industry."
  — Michael Batnick [03:40]

• "Equity keeps coming, rising to higher highs. If you do an average by decade allocation to equities, this is the new normal."
  — Michael Batnick [10:47]

• "I'm making the case that valuations don't really matter anymore."
  — Ben Carlson [11:44]

• "Nvidia was the number one sell in May. Isn't that wild considering how strong tech stocks have been?"
  — Michael Batnick [16:55]

• "If many of the jobs disappear in labor markets start to show massive amounts of unemployment, where will the relentless bid come from?"
  — Ben Carlson [28:09]

• "Google is shifting from being a search engine to an answer engine."
  — Nick Thompson, Atlantic CEO [42:33]

• "87% of bettors accounted for a total of 1% of sportsbook revenue, which means that the vast majority of betters are able to play safely."
  — Ben Carlson [44:33]

• "We're talking about a huge jump. 25 to 26% of your income."
  — Ben Carlson [53:46]

• "Gold is now the second most important reserve asset for central banks, overtaking the Euro."
  — Michael Batnick [64:35]

---

Note: The timestamps correspond to the transcript provided and indicate when each notable quote was made during the episode.

Transcript

[Michael Batnick]

This message is brought to you by Nuveen. What does it mean to Invest like the Future is watching? As one of the largest global investment leaders, managing $1.3 trillion in public and private assets, Nuvian is uniquely positioned to take on tomorrow today.

[Ben Carlson]

Combining over 125 years of deep expertise across income with innovative alternative solutions, Nuveen adapts to the needs of investors as they change, offering reliability, access and foresight to its clients, communities and the global economy, all in the pursuit of lasting performance. Nuveen Invest like the Future is watching. Visit Nuveen.com future to learn more. Investing involves risk. Principal loss is possible.

[Michael Batnick]

Today's show is also brought to you by Fabric Life Fabric by Gerber Life is a term life insurance you can get done right from your couch, all online and on your schedule. You can be covered in under 10 minutes with no health exam required. Ben, have you spoken to your kids yet about life insurance?

[Ben Carlson]

We haven't had that talk yet. I'm working on the personal finance stuff. I tried to talk to my daughter the other day about savings, but insurance is probably next in line.

[Michael Batnick]

Kobe's been asking me a lot about allowance. Not he hasn't used the word. He hasn't used the word allowance. He doesn't know what that means yet, but he's he's writing a list of chores that he should be doing, like taking R to the bathroom. Now Logan is getting involved. This has nothing to do with life insurance, but actually it does. I have kids. I want them to be protected, God forbid. So got to get yourself protected.

[Ben Carlson]

Thousands of parents trust fabric to help protect their family apply today in just [e-mail] spirits that's meatfabric.com spirits m e e t fabric.com Spirits policies issued by Western Southern Life Assurance Company not available in certain states. Prices are subject to underwriting and health questions. Welcome to Animal Spirits, a show about markets, life and investing. Join Michael Batnik and Ben Carlson as they talk about what they're reading, writing, and watching. All opinions expressed by Michael and Ben are solely their own opinion and do not reflect the opinion of Ritholtz Wealth. This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Ritholtz Wealth Management may maintain.

[Michael Batnick]

Positions in the securities discussed in this podcast. Welcome to Animal Spirits with Michael and Ben. Let's rewind maybe five years in the life of Ritholtz Wealth Management. My partner Chris was saying that we need to be doing taxes for people. This was a bit outside my lane and I wasn't totally against it, but I was nervous. A lot of liability. Didn't really see the upside. Chris was 100% right. I was 100% wrong with my reservations. It's been an incredible asset for our company and our clients. They love the service. We have the right people, led by Bill Arts who discovered us or came to us through this podcast. So now here we are five years later. We've got a team of, is it six or seven people on the tax side? We need more CPAs, especially in the Philly area. But we will talk to anyone. If you are licensed to file taxes, please reach out either to us directly. Animal spritscompoundnews.com or [e-mail] okay, one more plug. Actually two more plugs. Excuse me. This year at Future Proof. Can you believe it's already. Can you believe it, Ben? Can you believe it? You know, let's do the weather talk. Let's do the. We'll combine that. Can you believe it's that time of the year Slash weather? So it's been a shit week here in New York. A lot of gray, a lot of, lot of rain. Apparently it's gonna be 99 a week from today.

[Ben Carlson]

Okay. 80s in Michigan. So we've been, it's been lovely.

[Michael Batnick]

Oh, it's been okay. Because I was wondering, you know, I know we're in different parts of the country, but your Hawaiian shirt does not fit the mood around me.

[Ben Carlson]

It's Hawaiian shirt season. It's gonna be 80 something day.

[Michael Batnick]

It's okay.

[Ben Carlson]

It's nice and hot.

[Michael Batnick]

Credit to you anyway. I know I'm talking about the weather, but. Oh no, yeah.

[Ben Carlson]

I do Future Proof because you're a middle aged guy.

[Michael Batnick]

So we're doing something new this year at the festival. Heretofore that I use that. Right. Prior to we had been doing a fintech demo drop, which was mostly, not mostly which was reserved for newish companies, not the incumbents. We're doing something different this year. We want to talk about AI. We want to see what you're cooking up. This is the future of our industry. This is the future of the world. And if you are working on AI within the wealth tech area, we want to see it and not just, not just for the noobs, not just for the noob whales. If you've, if you're in a company, you're cooking something up, we want to see it. So we're doing a AI demo drop. Not just a wealth tech Demo drop. So, Lincoln show notes, time is running out. My bad for not plugging this sooner, but the deadline is this week, so please hit the link in the show notes, sign up there. Similarly, in that vein, I have a new channel on YouTube, a new show on our Unlock channel called Talking Wealth. Ben, you, me, Josh, we do a lot of podcasts. It's all about markets and the economy. When we are off mic, all I think about and all I talk about is our industry, the wealth management industry. And we did the first episode with Wealth.com. tomorrow I will be with Phil Huber talking about the alternative asset management industry the week after that. I'm very excited, speaking of AI, to talk to Dave Nig about the intersection of AI and financial advice. And I have a scorching hot spicy take. Not just for the sake of being provocative. I've been thinking about this and I think there, there might be. You know, I don't even want to say what there might be. Let's just tune in a week from today. After that I'm doing with Jason Wank with Ed Altruist, talking about the future custodian. So I'm very excited about this channel, about what we're doing. Please subscribe and if you're an advisor, you're not going to want to miss it.

[Ben Carlson]

Yeah, a lot more stuff coming there. A lot. And yeah, you're. You're. You're turning up the dial one more. We got new compound [e-mail]. we have a great Animal Spirits T shirt. It's a bull and a bear drinking cocktails. I'm just going to assume I'm the bull and you're the bear. Is that fair?

[Michael Batnick]

Really, dude? I have to remind you about your stance on tariffs, sir.

[Ben Carlson]

Hey, that was like, the fastest bear market in history.

[Michael Batnick]

You know what? How about this?

[Ben Carlson]

I got bullish at the bottom.

[Michael Batnick]

Each of us are bullish and bearish at certain times, when appropriate.

[Ben Carlson]

Speaking of, the bull has no shirt and the bear has no pants on. I think that's fitting.

[Michael Batnick]

Okay, well, then in that case, I'm the bear, and you're certainly the bull. I got new merch. And.

[Ben Carlson]

And. Wait, wait. And very good compound towels. I need to get some for the beach.

[Michael Batnick]

Excellent. I got new merch. Ben, as you mentioned before, we started the show, for those of you who are listening, I'm wearing a shirt. Robin took this out of the bag and she said, what the hell is this? And I said, what do you mean, what the hell is this? And she goes, what? I don't I don't get it. And I said, are you kidding me? You've never seen my cousin Vinnie? And she said, no, I don't know what to do with that. How's my wife? Never seen my cousin Vinnie. My wife is secretly movie person.

[Ben Carlson]

I would have assumed anyone who has even a slight New York accent would be force fed that movie at birth.

[Michael Batnick]

I mean, it was on USA and tnt on, you know, forever and ever.

[Ben Carlson]

Always still on HBO and those channels all the time. And it still slaps nostalgic movie T shirts and Knicks gear. Has to be 9% of your wardrobe.

[Michael Batnick]

How much?

[Ben Carlson]

90?

[Michael Batnick]

Yeah, I think he said not yet. 90. Yeah, we got. So these shirts are getting expensive. I don't. I definitely. I'm noticing it's pinching the pocketbook. Ben, we got. We got a retail print this morning. Retail sales. What was the number? It was not good. Down 0.9% in May. The worst reading since February 2023. The T shirts are getting too expensive. People can't. People can't afford to buy things anymore.

[Ben Carlson]

Is that tariff related?

[Michael Batnick]

Maybe tariff jitters? I don't know. I'm sure it's. It's bacon to the pie.

[Ben Carlson]

Okay, all right. I'll believe it when I'm still in a wait and see approach, and I'll believe it when I see it kind of thing.

[Michael Batnick]

Whoa, whoa. You'll believe and see what I just told you. We just got it in the data.

[Ben Carlson]

Yeah, but that's one. That's one reading. I need a trend fair, but it.

[Michael Batnick]

Corroborates a lot of what we're seeing and feeling.

[Ben Carlson]

Fair. All right, I have a question for you.

[Michael Batnick]

Okay, hit me.

[Ben Carlson]

I feel like for my entire adult life, there has been conflict in the Middle East. This whole century, it seems like there has been a ongoing conflict somewhere in the Middle East.

[Michael Batnick]

Not just your entire adult life, my friend. Everybody's adult life who has ever lived walked this planet.

[Ben Carlson]

It sure seems that way. And this may seem glib and not apathetic to what's going on over there, but does the Middle east even matter to markets anymore? So the US Is the biggest oil producer in the world. It seemed like that was the thing that always roiled markets is just. I mean, energy is such a tiny piece of the S and P now, what is it, 2 or 3% of the S and P oil prices? They spike when they see a headline of something going on, but then seem to just come right back down. Does it even matter anymore?

[Michael Batnick]

For. Okay, again, this is purely through the lens of the stock market. We are not overlooking the human tragedy. Okay. So just want to say that.

[Ben Carlson]

Yeah. When you're investing, sometimes you have to be unemotional about these things, unfortunately.

[Michael Batnick]

Does it matter for the stock market? That's a good question. I mean, the vix, I don't even want to say it had a baby spike. It didn't have a spike at all. It barely got over 20. Crude oil, to your point, did have an 8% rally on that night. Gave a lot of it back. Because we are not just dependent on the Middle east for oil anymore. So I don't know that it doesn't matter, but it certainly, certainly matters a hell of a lot less for the markets than it did previously.

[Ben Carlson]

It feels to me like investors are wising up to the idea that most headlines just don't matter anymore.

[Michael Batnick]

Well, certainly this. I can't imagine an average US investor making any portfolio changes based on what's happening in the Middle East.

[Ben Carlson]

Yes, exactly. And there's not even any really questions coming in anymore. Like any time there's a geopolitical event, it's. It used to be like, oh my gosh, what is this going to mean? And people don't even really question.

[Michael Batnick]

This is sort of circular. But if the market were down 6%, they would be.

[Ben Carlson]

Yeah, true. The market price forces narrative. All right. I can't remember where I stole this chart from. I get. I don't know, I'm subscribed to like three or four of those, you know, daily chart.

[Michael Batnick]

Daily chart book is a key.

[Ben Carlson]

That's probably it. And I can't remember what the actual source was. So I apologize. But this shows the aggregate allocation by households and it shows equity, fixed income and cash. And equity keeps coming, rising to higher highs. So it was as low as 30% at the bottom of the GFC and now it's at 53%. And if you look at a lot of, a lot of the historical studies will say, well, listen, anytime equity allocations peak, that's like a bad sign. It's a warning sign for the market. People are too far over their skis. And I just continue to think this is another sign of investor behavior improving that the fact that investors held so few equities back in the day was. That was the mistake, not this.

[Michael Batnick]

Yeah, I think this is a permanent shift.

[Ben Carlson]

Yes.

[Michael Batnick]

It's not to say that there won't be ups and downs, of course. And by definition in bear markets, the percentage allocation to equities falls as bonds offset that ostensibly and you know, more cash. But the average, if you do like an average by decade allocation to equities, this is the new normal. We're not going back to 30%.

[Ben Carlson]

And I've done a lot of work on this over time. The historical allocation to equities by households before the 1990s was very low. And so the fact that more and more people are involved in the stock market, it would make sense that this goes up.

[Michael Batnick]

You know. You know, there's a lot of talk about democratizing all sorts of different investments, particularly alts. We really democratize the stock market big time with, with auto enrollment, with ETFs, zero commission trades.

[Ben Carlson]

The barriers to entry have been completely wiped out.

[Michael Batnick]

Much more accessible than it happened in the past.

[Ben Carlson]

All right, so I keep making the case that valuations don't really matter anymore. And I say this kind of cheek.

[Michael Batnick]

Hold on. When you say, are you talking about the overall market or individual stocks? What are we talking about here?

[Ben Carlson]

I'm going to say individual stocks. So Sherwood News had this story about the most highly valued companies according to price to sales, and they used the price to sales as the end of Q1, 20, 25. And Palantir is at like 70. And there's all these.

[Michael Batnick]

It's not at 70.

[Ben Carlson]

Okay, so you think it's way higher than that.

[Michael Batnick]

No, look at the number.

[Ben Carlson]

Sorry, 69.

[Michael Batnick]

What does the number say?

[Ben Carlson]

I round it up.

[Michael Batnick]

I don't know why you would round up. It's right there on the screen.

[Ben Carlson]

We did bingo this past weekend with the family and like a bingo night thing. And B69 got called literally every time. And I just made me think of you for some reason. So they show all these companies that are trading at 15, 18, 20, 40 times sales. And as a point of reference, the S and P trades at something like 2.8 times sales. So obviously way, way higher. I just think investors are more accepting of these unbelievably high valuations than they ever were in the past. And I guess it kind of makes sense when you see these stories of companies with ridiculously high valuations continuing to charge higher.

[Michael Batnick]

Okay, what is. Okay, here we go. Wait, is this a post that I wrote? This is a post that I wrote. This is a post that I wrote. I was looking for something and I got myself. How about that? So I wrote this back in 2016. We've been doing this a long time, Ben.

[Ben Carlson]

Very long time. We've got plenty for an LLM to take all of our content now and just recreate us.

[Michael Batnick]

Okay, so when you are talking about valuations and in this case, we're talking about the price to sales ratio. We are. And I'm not saying that you're doing this, but you have to talk about the fundamentals of why valuations are rising. So the post that I wrote was Crist on value. Stephen Christ. He wrote about the parallels between horses and securities. Do you remember this?

[Ben Carlson]

No.

[Michael Batnick]

Okay, so Mauboussin wrote a piece quoting this piece, and Mobison said, Michael Maubouson said fundamentals are how fast the horse runs and expectations are the odds. In this case. Expectations. We're talking about valuations.

[Ben Carlson]

Okay. I have heard you make this. Do this spiel before. Yes, I remember now.

[Michael Batnick]

So the horse is running very fast. We're talking about margins. And we actually have this later in the doc for the show. We're talking about margins for growth companies as high as we've ever seen and accelerating. You're talking about companies getting to revenue milestones faster than you've ever seen and you're talking about, in some cases, pretty damn wide moats. So I reject the notion that valuations don't matter. I'm not saying that valuations aren't potentially silly in certain areas. I don't know enough about Palantir to say whether or not that's the case, although 69 times sales seems pretty rich. But we have to talk about the why.

[Ben Carlson]

How about this? In the past, it was way more clear if you saw numbers really high that. Okay, this is. This is a crazy bubble.

[Michael Batnick]

Yes. And it's harder to say that now because Gina Martin Adams on LinkedIn has a great chart showing the operating margin since 2000 of the S&P 500 and the S and P X Information Technology. And those have basically tracked each other. Okay. In fact, X Information Technology is a little bit lower because information technology, all of the giants that we discuss all the time have been up and to the right and have made new all time highs. We're talking about their margins alongside their growth. Actually, their growth is slow, but whatever. Not whatever. Their operating margins have continued to make new all time highs. Rewriting what we thought was possible for the stock market.

[Ben Carlson]

Right. Versus individual baselines. Right.

[Michael Batnick]

Yeah.

[Ben Carlson]

I heard Dan Rasmussen on a podcast recently. I think he's on the Long View. And he said, you know, when you're in a crisis, everyone knows when they're in a crisis. It's really hard to know when you're actually in a bubble because it can just. Things can go on for so much longer than you think. Like, I don't know, I'd say like the meme stock bubble, that was like a mini bubble. I suppose that was pretty obvious at the time. But just think about all the graveyard of tech predictions over the past 15 years about how crazy this stuff is. And now it's just become the new baseline, these growth rates and all that stuff.

[Michael Batnick]

So you know that quote, I won't read it right here, but that quote from the Money Game by Adam Smith talking about what time is it? And everybody's looking at the clock, but there's no hands to talk about where you are in the market cycle. Everybody knows it's getting close to midnight, but we don't know what time it is exactly. We've been talking about that environment for so long now. And there are obviously, by the way, there's pockets of the market right now that are acting insane. For example, consensus media, who is a great follow tweeted, Quantum Beverage Ticker Cub. I don't know what that company does. Do you?

[Ben Carlson]

I. AI Software.

[Michael Batnick]

Sure. Quantum Soda. I don't know.

[Ben Carlson]

By the way. Hang on. I think a couple weeks ago we said we didn't know what Palantir was and I got an e, a few emails from people being like, I can't believe that you guys talk about the markets all the time and don't know exactly what an individual company does.

[Michael Batnick]

It's defense tech. Do we need to know, like, what exactly that means? I don't know.

[Ben Carlson]

No, but this is the thing. You literally don't need to know what every company in the market does. And you can still be a good investor. How's that?

[Michael Batnick]

Sure.

[Ben Carlson]

It's okay. It's okay if you don't know everything. Yeah, honestly.

[Michael Batnick]

Okay, so Quantum.

[Ben Carlson]

There's a lot of stuff I don't know.

[Michael Batnick]

So Quantum Beverage is a $3 billion company that trades more daily dollar volume than intel, but with less revenue in forward projections than a single Chick Fil A location. That's insane.

[Ben Carlson]

Wait, why is this called Quantum Beverage when the company is showing Tamir as Quantum Computing? Q U, B, T. Yeah, okay. I don't know why they're calling it Quantum Beverage.

[Michael Batnick]

Is that a joke? I.

[Ben Carlson]

If you type in the tickets, it's Quantum Computing.

[Michael Batnick]

If you type in Quantum Beverage company.

[Ben Carlson]

Okay, see, this is showing how much we really don't know.

[Michael Batnick]

Yeah. Who cares? I don't know.

[Ben Carlson]

That's what the company's been around for a long time.

[Michael Batnick]

Either way, it looks a little bit. A little bit confusing. It is confusing. Either way. Again, I will reiterate, it's a $3 billion company that trades more daily dollar volume than intel, but with less revenue and forward projections than a single Chick Fil? A location. Wow.

[Ben Carlson]

Chick Fil A is very profitable, though. And they always say my pleasure when you say thank you for something. Okay, I'm going to start picking that up. I should teach that to my kids. I feel like when you say thank you to someone, you're welcome or no problem or any of that stuff, I feel like my pleasure. That's the. That's the boss answer.

[Michael Batnick]

You know one of my weaknesses. I'll say it. I'll admit it right here, right now. When people say something to me, I'm very bad at saying something back. Like when. Not mid conversation, but just a. Hey.

[Ben Carlson]

What? Have a good flight. You too.

[Michael Batnick]

Yeah, I did that. I did it the other day for something ridiculous. It might have been. It was something like, have a good flight. I can't remember what it was, but like a dad in passing that I've never spoken to at a baseball game said like, hey. And I. I said, you too. No, I didn't say you too. I said, good morning. But I. I did get a little bit flustered, I will admit.

[Ben Carlson]

Okay. This is us. We're not good at small talk sometimes. Right?

[Michael Batnick]

I should have just given one of these.

[Ben Carlson]

No Shame. Yeah.

[Michael Batnick]

All right. Schwab has this thing.

[Ben Carlson]

No, you're right. But there are. There are certain dads who. That's their thing. They can. They'll go up and glad. Hand every person along like. Like at the soccer field. They'll say hi to every person on their way to their spot.

[Michael Batnick]

Yeah. That's impressive.

[Ben Carlson]

I'm a head down kind of guy. Or a wave or a nod kind of guy.

[Michael Batnick]

You know, Same. I think I'm probably come off as very rude. Not my intention. I have a friend who every time we go out, he'll introduce himself to the waiter or the bartender. And for no other reason than he's just that friendly.

[Ben Carlson]

Okay. Yeah.

[Michael Batnick]

Hi, I'm Danny. Nice to meet you. What's your name? Like, who cares What. Uh, okay. Schwab has this thing. It's not brand new, but we. We don't discuss it much on the podcast. The Schwab trading Activity Index or the Stacks. It's a proprietary behavior based.

[Ben Carlson]

I would call that. Stacks.

[Michael Batnick]

Stacks. You know what you should call it? Stacks. You're right. I'm wrong. Stacks. Although something. Something screaming s taxing me. I don't know why. All right.

[Ben Carlson]

You always do this.

[Michael Batnick]

A proprietary behavior based index designed to indicate the sentiment of retail investors. So this tracked the market very closely. Sentiment and price in the 2020 period. Particularly Covid dump and the bubble in 2021. And then it's been sort of in the doldrum since there's a wide disconnect between stacks and the market.

[Ben Carlson]

Do you get how they're doing this?

[Michael Batnick]

It's. Excuse, sir. Proprietary.

[Ben Carlson]

Okay. Behavioral based index design to indicate the sentiment of retail investors. Okay.

[Michael Batnick]

Now it's. Now listen. It's quantitative. They've got all the data. Right. Like they say.

[Ben Carlson]

It makes sense that the behavior of investors was way crazier in 2021 than it is today. I. That makes sense. Surprising that it's going down though.

[Michael Batnick]

Well, this surprised me. Get a load of this. By the way. Good line. Get a load of. You don't hear people say that anymore.

[Ben Carlson]

Sure.

[Michael Batnick]

Nvidia shares, which gained nearly 24 during the May stacks reporting period on strong earnings and hopes for improved U.S. trade relations with China went from being the most heavily net bought stock in April to most net sold in May. So people took profits really quickly on that dip buy. Infotech was the biggest net seller sector on a dollar basis for the fourth month in a row. How do you like them apples? Isn't that wild considering how strong tech stocks have been? It was the biggest net sell sector on a dollar basis for the fourth month in a row.

[Ben Carlson]

It's interesting though because those stocks haven't rolled over at all. Not really selling. It's not.

[Michael Batnick]

I'm an all time high yesterday.

[Ben Carlson]

That's what I mean. Nvidia is still going up. So it's not like this has impacted the stocks at all. It's still selling.

[Michael Batnick]

Exactly. I thought this was very noteworthy. Nvidia was the number one sell in May. Mola said clients bought into the earnings the week of May 23rd when shares jumped above the 200 day moving average. And then they sold out after earnings of the week ending May 30th.

[Ben Carlson]

That's just a classic sell in May and go away. That's all that is.

[Michael Batnick]

Isn't that wild? That's surprising that Schwab clients sold Infotech for the fourth month in a row the biggest seller.

[Ben Carlson]

Do you think part of that is I was in a 40% drawdown or whatever it is and I. And I came all the way back and broke even and now I'm going to take some profit. I'm going to.

[Michael Batnick]

Because if you rewind, I could do this backwards in my watch this. May, April, March, February. Did I do that right? Yeah. Pretty. Pretty good. Those were down months, so people sold into the decline. Like those stocks got hammered in the first quarter. We spoke about that last week.

[Ben Carlson]

Yeah. Okay. So do you. Do you think that there's a difference between retail traders at Schwab and a place like Robin Hood?

[Michael Batnick]

Yes.

[Ben Carlson]

Right. That's.

[Michael Batnick]

Bingo. That was about to be my next comment. So you. There's so much data out there. You could really. You could really credibly make any case with data without. And. And get it wrong because there's just so much data like Schwab.

[Ben Carlson]

Maybe that's. Maybe that's why the sentiment readings are so much harder. Back in the day, when there wasn't as many investors, it was easier to compartmentalize and talk about investing as one big group of people.

[Michael Batnick]

Yes.

[Ben Carlson]

Now it's. There's so many different groups of investors and types of investors.

[Michael Batnick]

Bingo. Bingo. All right. On the other side of the spectrum, this is. This is very interesting. So we had mentioned that Jeffrey Patak, $1.7 trillion number in the. In the total stock market index at Vanguard a few times.

[Ben Carlson]

Right.

[Michael Batnick]

So I finally got around to reading it, and.

[Ben Carlson]

But that. That's ETFs and mutual funds altogether.

[Michael Batnick]

I think he said he excluded the etf, but I can't remember. Check the link in the doc if you're. You're curious.

[Ben Carlson]

Okay.

[Michael Batnick]

But there's a chart that shows the monthly flows as a percentage of assets. Now, because this is such a gigantic fund, there's not a ton as a percentage coming in and going out. Right. On a regular basis, except in April, they bought the shit out of this.

[Ben Carlson]

Wow.

[Michael Batnick]

So Vanguard investors, for example, aggressively, aggressively bought the dip. 2% of the fund came in in April. Or this is. Yeah. Is that right? Yeah. Wild, right?

[Ben Carlson]

That's a big spike. Huge spike.

[Michael Batnick]

So billions, tens of billions of dollars bought the dip. And. And they are not leaving.

[Ben Carlson]

No. So it's funny because people always say, like, don't time the market, but at times like this, when it, when it works, that makes sense to me.

[Michael Batnick]

Time the market on the way in.

[Ben Carlson]

On the way down. Right.

[Michael Batnick]

Yeah.

[Ben Carlson]

How's that?

[Michael Batnick]

I'm saying, like, when your money's coming in.

[Ben Carlson]

Yeah.

[Michael Batnick]

All right. I saw a great chart from Grant Hawkridge, who does fantastic charting work. Top 10. For me, the chart was so good that I said to Matt, you and.

[Ben Carlson]

I have a completely different experience on who we follow on Twitter. Because every time you're like, this is a great follow. I've never heard of this person.

[Michael Batnick]

Well, that's why I Love plugging people. Want to put. Put people on the radar.

[Ben Carlson]

Sorry, that was.

[Michael Batnick]

That was. That was like the clip of Shaq and Chuck.

[Ben Carlson]

Yes. Yeah. I love. I love plugging people out.

[Michael Batnick]

I do. That's. That's my thing. So Grant Hawkage tweeted a chart that showed the number of 1% up and down days by decade. Okay. And he says.

[Ben Carlson]

Which is a pretty good indicator of volatility because you get more of those. Yeah.

[Michael Batnick]

437 1% days up and down and counting. Grant says the 2000s are on track to be the most volatile decade in market history. But here's the twist. The s and P500 is up over 80% since 2020. Big moves, big gains, not the combo we're used to. So this chart was so good that I had chart kid recreate it. Credit to Grant. It's our chart of the week over at exhibit A. If you're an advisor, you can grab this.

[Ben Carlson]

That's a really good chart. I've never seen that before.

[Michael Batnick]

Me either.

[Ben Carlson]

And to your point, this is my whole idea of markets getting faster.

[Michael Batnick]

Yes.

[Ben Carlson]

It's more booms and more busts, and things are going quicker, and the moves are just more violent. And this makes sense to me that this would be elevated going forward.

[Michael Batnick]

Yeah. So I immediately thought of you, and you're 100% right. And this is. This evidence supports what you've been saying. Great chart.

[Ben Carlson]

I love it. So we got a little AI Pushback. And it is worth noting that the stuff that we're talking about, A.I. especially last week, we went really heavy on A.I. no one knows how it's going to end up. I'm using an NBA analogy here. After the Denver Nuggets won their title, it was like, whoa, there's a window here for dynasty. Right. And the Celtics won last year, and it's like, whoa, there's a window here for a dynasty. And now the Thunder looks like they're going to win. And it's like, well, there's a window here for a dynasty. And it seems like we're really quick to. So I just want to say, like, it seems like this is where we're going with A.I. we don't know. Here's a good pushback.

[Michael Batnick]

I'm very jealous of your night owl abilities. I fell asleep in the third quarter last night. I woke up very upset. I'm having trouble. Like, on Friday night, I had to do this.

[Ben Carlson]

I've realized that sleep is a very personal thing. There's people who say, like, you have to get Eight hours of sleep a night. Otherwise you can't function as a human being. I realize, and this year especially, I just for some reason have gotten less and less sleep and I stay up later and later and it hasn't impacted me at all.

[Michael Batnick]

It's a superpower. I mean, you've got lots of hours on me.

[Ben Carlson]

Remember, you know the video of the guy who says he does three days in one?

[Michael Batnick]

That's you after a month, by the way.

[Ben Carlson]

You have no chance.

[Michael Batnick]

I would have to look back and, and, and see. But from memory, this has been one of the best finals I've. One of the best finals in, in a long time.

[Ben Carlson]

Very competitive. Yeah, it's like, is it the best.

[Michael Batnick]

One since, since Dallas? I mean, that's 2011. I think since Dallas beat Miami. That's a long time ago. But it's. The games have been so, so good.

[Ben Carlson]

Yeah, no, I agree. And no one's watching. Let's see. Allow me to make a counterpoint on your AI Take. If many of the jobs disappear in labor markets start to show massive amounts of unemployment, where will the relentless bid come from? Who will spend money on all the things that power earnings for the companies? Why would small businesses advertise on Mag7 platforms if there's no return on their ads? Because no one is spending money. You just told me 60% and change of Americans own the stock market. Unemployment will cause that number to fall as people dip into their savings. The consumer power. The consumer powers earnings. Employment powers the consumer. Just a thought of employment gets weak, earnings will suffer too. I can't replace the spending power by the consumer.

[Michael Batnick]

Very good point.

[Ben Carlson]

Fair enough.

[Michael Batnick]

Here would be my counterpoint. I think it's possible and I think this person is generally right. Okay, so like yes, right. The pushback or the zag that I would have is this spend is being powered by the Mag 7 stocks. We said they're spending half a trillion on R and D and Capex. Now this person would say, yeah, okay, fine, but if the consumer stops spending, then they're going to slow down. And I would say probably true. But you could also see a weird dynamic where some of the jobs get that get displaced have no impact on the ultimate spending on these tech giants. But yeah, it's who, who the hell knows where this is going to go?

[Ben Carlson]

My, my, the counterpoint for me would be, well, the wealthy people are going to spend the money and they're going to be ones who benefit the most and they're going to power everything.

[Michael Batnick]

Well, you're right. So we Mentioned this a few times. The people that are most likely to get laid off, I would guess are probably not the wealthy. Although maybe not. Maybe AI displaces white collar jobs too. Anyway, we're all just guessing, like, who knows, right? I don't, I don't know where this.

[Ben Carlson]

Goes, but I also think we are so dynamic that we will like literally make up jobs for people. People need a reason to get out of bed in the morning. And so if waymos are getting lit on fire, guess what? Eventually they're probably going to pay a guy less than they would pay a driver to sit in the car and make sure no one messes with it.

[Michael Batnick]

So here's evidence supporting there's going to.

[Ben Carlson]

Be, there's going to be a way more greeter in your car or something.

[Michael Batnick]

Here's evidence to support what we're talking about from Schroeders. This is a great chart. US companies have been generating near record profits per employee. So real profits per employee. If you were to draw a trend line, it is straight up and to the right.

[Ben Carlson]

Okay, so you're just saying that like they don't need as many employees as they used to.

[Michael Batnick]

Correct. Okay, not great.

[Ben Carlson]

You know what would be the growth industry for me is probably just leisure and hospitality and other things. If AI is going to make you more efficient, I still think, regardless of how efficient technology has made us over time, does anyone work fewer hours than they did in the past? I always think of my dad working in the 1990s, pre Internet, pre cell phone, pre bring your work home.

[Michael Batnick]

It's different work, but it's more work.

[Ben Carlson]

We've given ourselves more work. You're right, it's different, but we've got all these tools to make us more productive. But we still work just as much or more.

[Michael Batnick]

But I do a lot of work and I don't know why I'm like, I guess you could air quote this because some people would say, how does that work? But I do a lot, especially when the weather gets nice, I do a lot of walking calls. That is so much different. Like my dad was a dentist. He didn't have that luxury. Right. He was over the table in people's mouths.

[Ben Carlson]

I think about that often when I'm at the dentist that, you know, you and I sit in front of a computer all day and we can get sidetracked on something else for 10 or 15 minutes or however long, watch a video or do some, something on our banking or whatever it is. But if you're at one of those jobs that you're constantly doing and you can't have computer time. That's real work. What we do sometimes is not real work. Knowledge workers. Yeah, right.

[Michael Batnick]

Yeah. And so I think that, like, people that are doing different work than us, where they don't have the luxury of being able to take a phone call and walk in the sun or to be able to stand and look at their screen. I would hate people like us. Seriously?

[Ben Carlson]

Oh, yes. No, I totally. No. My wife was a radiation therapist and she would be. She would be there at the machine all day long and get like a half hour break for lunch, and that's it. I want to talk about how much money there is in the economy, which is something we've talked a lot about. But I have a story to start this off with. So you have your beach club in the summer you talk about. Right. We have a pool, boat club on our lake that we go to. And this is. It's not like anything super fancy. This place has been around for like 100 years. So it's really, really old. And the dues for this thing are comically small. Less than $1,000 a summer. And we get to go there. They have a little window. You can order food for the kids and get ice cream and there's a pool. And they have events. They have these social events. It's really fun place. And this place has been around for a long, long time. The building is over 100 years old. So we had to have a meeting this past weekend because this building needs to be totally renovated. They've done studies on it, and they say there's so much that is not to code here, that this place is literally. It's 118 years old. So we have to either completely renovate it and bring it up to code or tear it down and build again. It's a huge, huge. This is like an 8,000 square foot building.

[Michael Batnick]

And what's inside of it? Is it like a hall?

[Ben Carlson]

So they have a hall upstairs where they do events. It's really fun. It's. It's a very, you know, they have big parties. They have like theme parties. And it's. It's like at the end of the year. The big party every year is a pirate's costume ball. Everyone dresses up as a pirate. Remember I sent you pictures last year of me dressed up as a pirate? And so the community loves this place, but this is a big undertaking. And they're saying, like, every, like the foundation is like. So all the stuff that was done 100 years ago, they didn't expect it to last this long. And it did. They need to redo it. So they're probably going to like graze this place and start over. So I'm at this meeting and trying to understand what this means and stuff. And there's only like a handful of like a few hundred people who belong to this club. So obviously the dues don't cover anywhere close to the cost. So it's going to be five or six million dollars to either renovate or redo this place. Right. A lot of money. Halfway through the meeting, finally someone raises their hand. How are we going to pay for.

[Michael Batnick]

This private equity infrastructure Done.

[Ben Carlson]

Yeah, I'm going to start a private credit fund. But they weren't really worried about it because, like, we have a few affluent members who are probably going to pick up the cost. And I feel like that's the U.S. economy. Like rich people power the U.S. economy. And they are in such a better place than the rest of the, like the, I'm talking like the top 1% here are like, they have the ability. They, they don't have to worry about the economy really unless their, their company or business goes under or something. Right. So Mike Zakari had this tweet. I'm pretty sure Goldman stole this for me because I, I did a piece about this about a month ago. So they say the top 1% owns 51% of the stocks. The bottom 50% owns 1%. Right. And this, this has been pretty stable over time too. I pulled this one from JP Morgan. It's total assets in the economy versus total liabilities. It's 190 trillion assets and it's 21 trillion liabilities. But when you dig down. Jeremy Herbert. I'll put this out. The median net worth.

[Michael Batnick]

I'm sorry, you think Goldman stole this chart from you? They've been, they've been charting this for years. I think they incepted into your brain and you stole from them. How you like that?

[Ben Carlson]

Now the way that they're showing this, the 50 and the 1 and the 1 and the 50, that was me, trust me, I was on this well before them. So he shows the median net worth by households. And this is, goes back to 2022. So it's a little higher now, but not much. It's like $140,000. So you look at all these assets.

[Michael Batnick]

That sounds, that sounds pretty good.

[Ben Carlson]

So it's, it's, it's the highest in history. Again, that's the median number. But that just, but that also shows how, how much is concentrated at the top, though, right? He broke this down, too. By married, not married, single, children, no children. And if you are, you know, you're married, you're. And you have no children, your net worth is a lot higher. If you have married with children, it's a little lower, but that's much higher than people who are married and such. But my whole point here is that there are just a lot of rich people, and I think that they are kind of the savior for the economy at times. And I think they're probably part of the reason that this has just been powered for so, so long, because they're almost immune to the ups and downs of the economy. Save a bad business deal or a business sector going under. Fair enough.

[Michael Batnick]

That's mostly right.

[Ben Carlson]

It just makes me realize that, like, oh, rich people just. They'll come in and save the day. It's like that. Oh, okay, okay.

[Michael Batnick]

A good segue to this.

[Ben Carlson]

There's lots of rich people. That's my point. How's that?

[Michael Batnick]

Yes. So.

[Ben Carlson]

And they have lots of money.

[Michael Batnick]

New cycle high for continuing jobless claims. Kevin Gordon tweeted this. Does this matter? Does a slowing economy matter for the stock market? I mean, I can't believe I'm saying this out loud, but I'm. I'm kind of curious.

[Ben Carlson]

It would be weird if it didn't right now.

[Michael Batnick]

It matters for certain areas of the stock market, obviously, like, areas that would be impacted by, you know, people, whatever. We spoke about McDonald's as an example of things that people would cut back on. But how does this impact the hyperscalers? Do they care?

[Ben Carlson]

I do think. Could this be the time where the unemployment. I've said this a few times, where the stock market doesn't care if the unemployment rate rises a little bit because it'll think, well, that's AI working. AI is crowding out jobs and making it so we're more productive. I don't know that you could prove that, but I don't know.

[Michael Batnick]

Strange times we live in.

[Ben Carlson]

Ben, it would be a weird statement to make that the stock market doesn't care about a slowing economy. Yeah, that would seem to be a stretch.

[Michael Batnick]

I would agree. All right, Nick Timoraos tweeted, fed call as of 610 in terms of where banks are looking for rate cuts. And really nobody, except for mufg, who, I'm not quite sure who that is, expects a July cut. We've got a Fed meeting tomorrow. It looks like there's a bunch of Septembers, couple October's Decembers. Tim Morellos had a piece out this morning talking about why the Fed is not cutting. And it seems like they are just for better or worse in my estimation. Worse? They are much less focused on the slowing economy, arguably. Well, yeah. Deteriorating economy as they are, the potential for inflation to come back. They're not cutting in July.

[Ben Carlson]

If the economy is slowing, the Fed's going to be late. That's. That's should be your baseline assumption.

[Michael Batnick]

Yeah. And they're basically saying that. So this is a wild chart.

[Ben Carlson]

Wait, hang on, Duncan. Duncan says that I'm going to get punched in the face by someone, think I'm sarcastic by saying my pleasure. So maybe I should rethink that strategy.

[Michael Batnick]

What's wrong with my pleasure?

[Ben Carlson]

How many people do you know, besides Chick Fil A that actually say that? It could sound kind of sarcastic.

[Michael Batnick]

Depends. Depends on how you say it. I don't think it would sound sarcastic coming from you.

[Ben Carlson]

Okay.

[Michael Batnick]

All right. We talk a lot about consumer confidence. The UMich survey, Tor and Slack did a chart book on China and look at this. Chinese consumer confidence index. Holy mackerel. Crashed and no recover.

[Ben Carlson]

I thought the way that it worked in China is the president tells you what your consumer confidence is and that's what you say is that surveys work there?

[Michael Batnick]

I guess not. Look at this. Isn't that wild?

[Ben Carlson]

Not great.

[Michael Batnick]

I mean, compared to them, we are downright giddy.

[Ben Carlson]

Okay. They don't enjoy spending money as much as us though. Right.

[Michael Batnick]

I know very little about the Chinese culture, but I would assume that's fair.

[Ben Carlson]

All right, so I have read a lot of books about bubbles over the years. I find it fascinating. From the South Sea bubble to the Mississippi bubble and the great the Roaring Twenties and all these different nifty fifty stocks. And every one of those books that I've read about bubbles, I think the Devil Take the Hindmost is my favorite. Just short chapters all on. And it has great stats on every one of them. And every one of those has stats that you read and you go, oh my gosh. Like in the South Sea bubble. Like there was a hunchback people were using to sign away their equity papers on his back or something like crazy stories, like. Right. This is the one from Mr. Tekery about the AI bubble. This is going to be used in future books about the AI bubble. Okay. I don't know if you read this. So this is Ben Thompson quoting Casey Newton's substack. They're talking about meta trying to hire away AI researchers. All will be making pro athlete money or better. I heard one credible story of a researcher being offered $75 million to join Meta, the Times reports some offers stretch into nine figures. That may sound like a lot for one person, and it is. But in some sense, Meta's future depends on hiring, retaining these people. And Meta has already committed 65 billion billion to AI infrastructure this year. What's a few hundred million more? Now this may seem like, oh my gosh, these AI researchers are making NBA money. But when you think about the amount of wealth that's at stake here, it actually makes sense. It doesn't make sense, but it does actually. But that's a bubble anecdote right there.

[Michael Batnick]

That's a good one, right? That is a good one. All right, here's a good one from the Wall Street Journal News sites are getting crushed by Google's new AI tools Business Insider cut about 21% of its staff last month, a move CEO Barbara Peng said was aimed at helping the publication, quote, endure extreme traffic drops outside of our control. Organic search traffic to its website declined by 55% between April 2022 and April 2025. At a company wide meeting earlier this year, Nick Thompson, chief executive of the Atlantic, said the publication should assume traffic from Google would drop towards zero and the company needed to evolve its business model. Quote Google is shifting from being a search engine to an answer engine, thompson said in an interview with the Wall Street Journal. Quote, we have to develop new strategies.

[Ben Carlson]

So, wow, this is a crazy chart. So this is why I keep coming back to the whole creativity thing and the ability to build your own audience. And I think having an email list is so important now because you go straight to the consumer as opposed to relying on. I know why these big news sites have to rely on these platforms, but that's why as an individual practitioner or whatever, having your own audience is going to be more important than ever.

[Michael Batnick]

So these stories, stories like this are going to keep coming.

[Ben Carlson]

Oh yeah, for sure.

[Michael Batnick]

All right, Ben, I've been thinking a lot about this and I'm glad that I waited on the matter because there was an article that Kyla wrote on her substack talking about a new book called Losing America's Reckless Bet on Sports Gambling by Jonathan Cohen. And I've been thinking about this because there are people, many people, some that I know, that are being greatly impacted by sports betting. Now I want to preface this, have.

[Ben Carlson]

To be there have to be some tales of woe for this stuff.

[Michael Batnick]

It just has to by saying I love gambling and I enjoy the shit out of sports betting. Yes, I lost more money than I should have last season. Oops. Happens. I'm not mad. I will continue to gamble because I love it. I will put better guardrails on this time. But okay. With that said, this is, this is not great. So the the founder of Polymarket tweeted how popular Polymarket is getting visits in May 15.9 million Coinbase 34.7 million Robin and 37 million. Also right on this list, right behind number four and five, Spotter, DraftKings and FanDuel. Now I think betting markets like Poly Market are generally like more fun, less addictive type betting. Right. I would suspect.

[Ben Carlson]

I bet there are people who are addicted to just trying to guess every outcome of everything though.

[Michael Batnick]

Yeah. But I feel like I got ruined on Poly Market is like, come on, like how. I mean that's true.

[Ben Carlson]

More likely on FanDuel or DraftKings. Yes.

[Michael Batnick]

But the, the betting on sports now I it's not going backwards. I think that there are probably some things that can be done. They alluded to in this article about how to better regulate it and prevent people so here's, here's some something from from Kylie Substack. A study on NFL betters from the 2023, 2024 season found that 87% of bettors accounted for a total of 1% of sportsbook revenue, which means that the vast majority of betters are able to play safely. Okay, It's a big number. 87 accounted for 1%. Then there's the that other percent of players, like 3% of players that account for like 80% of the revenue. Some of them are really rich and good for them. They can spend their money however they want. Some of them are not really rich and their dopamine pathways are rewired and they're addicted to. So Kyla asked him, how do you exercise personal responsibility against a system designed by teams of behavioral psychologists and data scientists specifically to defeat your capacity for rational decision making? I genuinely don't know. And I've used, I've used as an analogy alcohol, but I don't it's probably not a good one because John said it's unlike drugs or alcohol in that way. There's no reason that you'd expect oh, if I have another shot of vodka, it will cure all the negative effects of my alcohol addiction theoretically. Like if you hit the Milwaukee Bucks over tomorrow night, it could wipe out all of your debt. So you just keep chasing and keep chasing.

[Ben Carlson]

So it's more like, it's more like a lot the lottery mentality.

[Michael Batnick]

So there's been a lot of studies out of the UK about suicide among young men because they. They're way ahead of us in terms of their adoption of this. And again, I know this is, like, wildly complicated, and I get personal responsibility, you know, people, but like, oof. I just don't know.

[Ben Carlson]

So we had. Before casinos were everywhere. We had a handful of them in Northern Michigan, where I grew up, on the Indian. Indian reservations. That used to be the only place you could have casinos in a lot of areas. Right. When I was younger, and they made the switch when I was in high school, it was perfectly timed. When I was a senior in high school, they made the switch from the gambling age being 21 to 18. Right. So a senior year of high school, my friends and I would go out to the casino, drink a few beers in the parking lot, go gamble. The greatest thing was the first weekend they made the change. All the waiters and waitresses in their head, it was like, you don't have to ID anyone. So they were serving a beer at 18 at the table. Great time. But I would witness these people on a Friday night take their paycheck, sign it over to the casino and get it all on chips and go literally gamble their paycheck.

[Michael Batnick]

And now it's on your nose on your phone.

[Ben Carlson]

And we talked earlier about the benefits of breaking down the barriers to help people invest in the stock market. That's amazing. Breaking down the barriers to help people gamble, obviously, is the opposite effect. And it's one of those you can't put the genie back in the bottle things. Unfortunately, people want everything to be easier because we have the technology for it. And I don't know.

[Michael Batnick]

One of the. One of the. One of the suggestions that was made which seems reasonable is I don't know how this would be work or enforced, but make maybe, like, some income verification on if you get past $10,000 in losses, whatever it is like now, are they going to enforce that? Why would they? But lives are being ruined, and that is just a fact.

[Ben Carlson]

Yeah. And I think we are in the era of I don't need other people to tell me what to do. I can do what I want, like, good and bad, put it all out there, let me make my own choices. And unfortunately, that's gonna hurt a lot of people.

[Michael Batnick]

Yeah.

[Ben Carlson]

I think that's just the way it is.

[Michael Batnick]

That is just the way it is. You're right.

[Ben Carlson]

All right, let's talk about bitcoin again. Last week, I talked about how crypto is tradfi. I think crypto needs tradfi. So Eric Balcunas quote tweeted this one from a crypto person. What percentage of crypto people do you think have like a cartoon or AI generated picture for their social media? It's gotta be like 90% high, right? It's very high. So this person tweeted. Bitcoin is currently trading at over $105,000. If you want to buy on Coinbase, they charge 100 and close to $107,000. If you want to sell, it's more like $104,000. WTF? So Eric Balchuna says, like this is why ETFs are growing like wildfire. They don't have these wide spreads like this. And I do wonder how much of the money going into this. Obviously a lot of it is new adoption is just people who are like sick of paying these ridiculous spreads. And also, how is this still happening? Bitcoin is way more. It has to be far more liquid now than it was. I understand this happening in 2014 and 2017 at the beginning when it was still this new thing. How are. Because I saw this when I was on trying to sell some bitcoin earlier this year on Robinhood, which was a great timing at the time. Round trip and not so much anymore. I did buy back in some, but I looked at this and the spreads were really, really wide still. And I guess the whole point is use limit orders. But how many people actually use limit orders? Yeah, yeah, but I mean that's the solution. But this is why the ETF make. Even if you're paying a fee on the etf, it probably makes sense. Cause you're gonna pay higher fees to jump in and out on these brokerage platforms.

[Michael Batnick]

No doubt.

[Ben Carlson]

Why are these spreads so high still? Just cause they can and no one pays attention. That seems ridiculous to me.

[Michael Batnick]

Yeah, because they can. I don't know. That's it.

[Ben Carlson]

Okay.

[Michael Batnick]

I think the potential gains that people are looking at on bitcoin and the speed with which people are transacting, they just, they don't care because if they did, yeah, it would change.

[Ben Carlson]

I do think that's part of it, but that's the bull. That's one of the biggest bull cases for the ETF though is just people finally wising up to it.

[Michael Batnick]

So here's the headline. Crypto tycoon Justin Sun's Tron Group to go public in US via the first merger, AKA spac. Here's the lead. Winter Park, Florida based SRM currently designs and manufactures toys, souvenirs and plush Items for theme parks and entertainment ventures. Its products include Smurfs, water bottles and stuffed animals such as Hannah Hedgehog and Gideon Gatorade. SRM shares surged on the disclosure, rising more than 500% in midday trading. The toy company said it was acquiring TRX to establish a Tron treasury strategy, referring to the growing ranks of publicly traded companies that have announced plans to add cryptocurrencies for their balance sheet.

[Ben Carlson]

Okay, seems legit. I don't know.

[Michael Batnick]

So I guess we're doing this again. This is where we are, right? This part of the cycle.

[Ben Carlson]

It'S going to get stupider. Just wait, we're not even close.

[Michael Batnick]

All right, here's another one. Thomas Brazil tweeted, at this rate, chart a circle. At this rate, the company is going to be worth more than the assets under admin. Haha. I mean, come on, people. So Split Capital Quote tweeted it and said Circle made about $200 million after paying out incentives in 2024. It's trading at 162 times those figures now. Market can't get enough stablecoin exposure. Now, I think the last part is the interesting part. Market can't get enough stablecoin exposure. Now you may say this is madness, this is stupid. This makes no sense. And I would agree, but I also am a market person and the market has spoken. It's not to say that the market can't change its mind, but it's really interesting. Market can't get enough stablecoin exposure.

[Ben Carlson]

Did you read the Michael Semblance piece on stablecoins? He's, he's. Okay, take a look at that. Maybe we can discuss it. But he's.

[Michael Batnick]

Oh wait, yes I did.

[Ben Carlson]

On sale. He's not sold. On sale.

[Michael Batnick]

Yes, I did. He does some adjustments about the actual transaction count, right?

[Ben Carlson]

Yeah, he's, he's not as sold on stable coins as the BL end like a lot of other people are.

[Michael Batnick]

Okay. And, and I, I don't really have opinion on, on the long term adoption of stable coins. I would probably think I'm a little bit more bullish than him, but I'm just think it's interesting that public markets are eating this shit up.

[Ben Carlson]

It is.

[Michael Batnick]

And I, I generally am of the mind that even though stuff is stupid, markets aren't that stupid.

[Ben Carlson]

Yeah, I, I just do find it kind of hilarious that the whole idea of crypto was like we're going to end the dollar. And, and the whole idea of stablecoins is it's a way to put your money in the Dollar.

[Michael Batnick]

Yeah, but that's. I don't think that's like a good. Gotcha.

[Ben Carlson]

What, are you kidding me?

[Michael Batnick]

It's not like every bitcoin person is saying it's going to replace a dollar, and every bitcoin person is saying stablecoins are the dollar. Like, I get the paradox. But.

[Ben Carlson]

Okay, let's talk about housing. A lot of people keep saying housing is broken. Maybe I've even said that before. I think I've come around to the fact that housing is just not fair. It's not broken, but it's not. It's not fair.

[Michael Batnick]

So, okay, go on.

[Ben Carlson]

Joe and Tracy on odd lots this week, had the guy from Morgan Stanley, their housing expert, and did you see this chart here? The evolution of mortgage payments to household incomes? It's kind of a weird chart. So. But go with me. And so it looks at the percentage of your income you're spending on your mortgage payment.

[Michael Batnick]

That's an excellent chart.

[Ben Carlson]

And this went from 12, 13, 15% pre pandemic to now in 20, 22, 23, and 24. More like 24, 25, 26% of your income. That's a huge, huge jump. Obviously. Now here's the. Here's the not fair part. So I'm making these numbers up and I think they're directionally right. So 60 to 65% homeownership rate in this country. Right. We know that number. I would say 25 to 30% of the country is probably always going to rent because they live in a big city or they just can't afford to buy a house or don't want to buy a house. And then that leaves anywhere from 5 to 15% or so of people who like, want to buy and are in a difficult situation. My point is, and obviously there's people who own a home already who want to buy, but they have. And they don't want to cause of mortgage rates. But they have equity and they could if they wanted. Probably my point is that it's a minority of people who are really impacted in a bad way by this. It stinks. It's not fair. But I think that's probably why there's not more like groundswell support for like pitchforks and torches. Right? We need to fix this. That's probably why it doesn't happen. Because the people who already own a home are the majority. They're the ones who benefited the most from this.

[Michael Batnick]

Think about new homeowners are getting. Absolutely.

[Ben Carlson]

So think about this. If you bought a house in 2018 and it was 16% of your income. Wages are up 30% since then. So your mortgage payment has stayed exactly the same and now it's a smaller percentage of your income because your income has grown. Think about how much of a better position you are as a consumer to spend money now because of that. Yeah, it almost doesn't seem fair.

[Michael Batnick]

It's not fair.

[Ben Carlson]

All right, let's talk private markets, because we've been talking about them a lot lately and this is one of those that it's not a flash in the pan thing. Right. Private markets. This is going to be a big story for a long time to come.

[Michael Batnick]

I feel like I am super bullish on the idea that private equity, private assets are going to continue to infiltrate and grow in size. That is no comment on whether or not these are going to be good investments, but they're going to win.

[Ben Carlson]

Yeah. We've talked to a number of managers that they've made these evergreen slash interval funds that make it easier than ever to invest in this stuff. And yeah, I, I agree. And I assume, do you think that some of them, I don't know what the rules are. Why do you think it is that every quarter you can only take 5%? Is that a rule?

[Michael Batnick]

So with.

[Ben Carlson]

Or is that just the industry standard?

[Michael Batnick]

Okay, I'm going to talk with Phil about this on talking wealth. And there are certain funds, there are certain interval funds where it is contractual that you have to redeem up to 5% of NAV. There are other structures like Starwood that have the ability to say, can't do it.

[Ben Carlson]

Yeah, we can't get it.

[Michael Batnick]

But I'm just gated at 2%.

[Ben Carlson]

Wouldn't we get in the future one of the companies saying, all right, these companies, these funds are all doing 5%. We're going to let 10% out. We're going to be more liquid.

[Michael Batnick]

It depends on, it depends on the underlying investments. If you're a real estate, how do you do that? You can't.

[Ben Carlson]

True. All right, so this is from the New York Times. Yale is rushing to sell private billions in private equity investments. Here's from the story. Yields University's famed endowment has been trying to offload one of the largest portfolios of private equity investments ever in a single sale. A movie that reflects both pressures on Wall street and higher education under the Trump administration. The Ivy League school has sought buyers up to $6 billion in stakes of private equity and venture funds. And it sounds like the secondary discounts aren't as much as they were. But this is the downside of illiquidity they realize, like, their liquidity profile might have to change if they're going to have to pay higher taxes or they're, like, going to have to spend more money because they're not going to get as much government funding. This is when illiquidity hurts you. Now the people would say, well, who cares? For 40 years, Yale has benefited from private equity. They're way bigger than they would have otherwise. I read all the David Swensen books, like, they were the first ones there. But this is, this is the downside of it. This when, when you need the money, sometimes it's, it's going to be painful to get it.

[Michael Batnick]

Did you hear Mobison with Patrick?

[Ben Carlson]

I don't think so.

[Michael Batnick]

So I'm sorry, not Mobison. Bill Gurley. My bad.

[Ben Carlson]

Yes, I did listen to that.

[Michael Batnick]

So Bill Gurley said, and by the way, shout out to Patrick for including videos. I love seeing videos on podcasts. I, I kind of didn't think I was going to five years ago, but.

[Ben Carlson]

It is something I would never would have thought of either.

[Michael Batnick]

And it's not that I'm like, glued to it, but like, I like looking down and seeing people laugh and seeing the body language and seeing who's speaking. Right. These are generally faceless people. Not all, not all of Patrick's guests are, are, are people that I've heard of. Graham Weaver, for example. Like, I enjoyed watching that guy.

[Ben Carlson]

We have a lot of YouTube only viewers of this podcast, obviously.

[Michael Batnick]

Yeah.

[Ben Carlson]

Part of it is they get to see some of the visuals and they get to see your T shirts and my Hawaiian shirts.

[Michael Batnick]

And so Bill Gurley said, does the Yale model work when everybody's doing it now? There's a lot of nuance in the story because Yale's been doing secondaries forever. And I think the impetus for this is potentially new regulation. So in a statement provided to the New York Times, a representative for the Yale Endowment acknowledged the sale, but called private equity, quote, a core element of our investment strategy. The statement added, we are not reducing our long term target to private equity. So there is so much to talk about with private markets and there's so much nuance and damn it, I lost my train of thought. How about that?

[Ben Carlson]

How about this? One of the reasons they're harder to understand is because this is a good one from Morningstar. IRRs are not the same thing as returns. You can't eat irrs. I wrote a story on this. A long time ago. There was a story that Yale's venture Portfolio has an IRR of 70 because they invested in LinkedIn early on or something and it was like 70% IRR and that would be like an annual return. But if you plugged 70% per year on Yale's endowment or just their piece of venture, their portfolio would have been worth like a trillion dollars or something. So the way IRRs work, it's not, it depends on the timing of the cash flows. Matters a lot in that calculation and so it's not the same thing as a compounded return. Now I do think that the interval funds make change this a little bit, make it easier, but those old school private equity funds are not as good as they look from their IRR numbers.

[Michael Batnick]

So the example that they gave was. They gave an example. And again, we'll link to this if you want to read it more closely, but they show an ETF with a 15% annualized return. That's actual dollars annualizing versus a private fund that is able to say that they have a 15% IRR and the growth of a dollar. It's, it's night in day.

[Ben Carlson]

Not even close because you don't just give all your money one day to the private equity fund. And it's total, it's invested up front. It takes a long time to invest. So that's, that's the point. It's a different.

[Michael Batnick]

I lost my train of thought. I felt like I was rolling. Oh, well, okay.

[Ben Carlson]

Well, more to talk about with this.

[Michael Batnick]

More to come for sure.

[Ben Carlson]

All right. Survey of the week from Gallup American satisfaction. With the way things are going in.

[Michael Batnick]

The U.S. this is just trash, just garbage.

[Ben Carlson]

I mean, in the 80s and 90s and even the 2000s, it was regularly 70%. It's now at below 40%. And really since the great financial crisis, it never recovered.

[Michael Batnick]

Do you think you could accurately track happiness?

[Ben Carlson]

No. Impossible.

[Michael Batnick]

Impossible.

[Ben Carlson]

There was that one happiness study. I can't remember what the name of the book was. It was a happiness study by Harvard that they did over the course of people's lifetimes. And they constantly sent them surveys like that to me. But that's not how these other surveys work. It's a point snapshot in the point of time. Right?

[Michael Batnick]

Yeah.

[Ben Carlson]

All right. What did you call last week? The people who are really rich, but then they don't. It's a reverse. What do you call?

[Michael Batnick]

Reverse flex.

[Ben Carlson]

Reverse flex. So I don't even know how to say his name. Ingvar Kampra. This is from Dividend Growth Investor on Twitter. Founder of Ikea was close. Worth close to $60 billion at the time. Of his death. He drove a 1993 Volvo for two decades, purchased clothes from flea markets, got his haircut in foreign countries. Can you get cheaper haircuts in foreign countries? And he flew coach. This is not something to aspire to. But the problem is, and I don't think so personally, he probably doesn't become as successful as he is if he doesn't do these things. He doesn't create Ikea if he doesn't have that maniacal whatever about him.

[Michael Batnick]

Sure.

[Ben Carlson]

So that's the hard part about it. As a regular person, you look at this and you go, this is insane behavior. But if he wasn't a little insane, he doesn't create this type of company. Right. All right. Our very own Kelly Cox had a great piece this week called My Money Story, and she talked about how childhood financial insecurity defined her life. And she told her whole story about growing up in a family with a lot of kids and not having a lot of money, and how the great financial crisis sort of devastated her family. Her parents lost their jobs. And it's really good. It's a really, really good reminder of how much your experiences can shape your views of the world and your views of money and risk and all these things. Because I think a lot of times in finance, we look at the spreadsheet stuff and go, here's your measurables. You should do this. And so many times that those measurables do not tell the whole story, obviously.

[Michael Batnick]

No doubt.

[Ben Carlson]

It's really great. I mean, I remember talking to a client once who worked at Lehman Brothers and had. I can't remember the number. 70% of their net worth in the company that went to zero. Totally, completely changed their view of risk forever.

[Michael Batnick]

Of course. How could it not?

[Ben Carlson]

How. Right. These are the things that I think you can't pick up in just the measurables.

[Michael Batnick]

Totally. All right, then. We are living in the age of nostalgia in movies in particular. So we've got a new Naked Gun coming out.

[Ben Carlson]

We've got looks Decently Funny.

[Michael Batnick]

I was forced. I said I was out, but I was forced to watch a trailer and a movie I saw lately. And you're right. Looks good. Okay. Lewis Pullman is set to star in Spaceballs 2 next to his father, Bill Pullman.

[Ben Carlson]

I mean, obviously, that guy's the guy from Top Gun Maverick. That's Bill Pullman's son.

[Michael Batnick]

News to me.

[Ben Carlson]

Can I make it? Can I give a. An admission here? I have seen Spaceballs more than I have seen Star Wars. Like, I enjoyed Spaceballs more than Star wars growing up.

[Michael Batnick]

I mean, that's fair. I certainly enjoy Hot Shots more than Top Gun.

[Ben Carlson]

That Hot Shots was pretty good. I have some. I still have Star wars hot takes. I'll save them for another time because we're going long. Okay, one of these times.

[Michael Batnick]

Another one. Masters of the Universe. Holy shit. He Man. You kidding me? By the way, I haven't said the word he man in 30 years. And that's a hilarious name for a superhero. He man.

[Ben Carlson]

Yeah, that was kind of a weird one. Skeletor. Great, great villain, though.

[Michael Batnick]

Who is He Man? Do you know who that is?

[Ben Carlson]

No idea. Looks pretty jacked, though.

[Michael Batnick]

All right, let's. Let's just skip. Oh, one thing. I just want to talk about this real quick. So there's a chart in the ft. Gold is now the second most important reserve assets for central banks. Gold is overtaken the Euro as the world's second most important reserve asset for central banks, driven by record purchases and soaring prices. So we had Steve Eisman from the big short on tcaf, and he spoke about all of this deficit talk is virtue signaling. He's like, where else are you going to go?

[Ben Carlson]

I loved. I loved that. That's always been my take. I was like the lady in church with her hand in the air with a preacher like, yes, preach. I have. I have for years have said, I'm not worried about this. And I totally agree with him that all these hedge fund managers, they have to try to one up each other and say, like, I'm more worried. No, I'm more worried.

[Michael Batnick]

And then if you're not worried, it's like, you don't care about America. You don't care about starving our children, leaving them the burden like it is.

[Ben Carlson]

Screw the grand. Screw the grandkids.

[Michael Batnick]

Yeah.

[Ben Carlson]

When has the bill ever come due for the grandkids? When.

[Michael Batnick]

You know, now you're being selfish because. Just wait.

[Ben Carlson]

Yeah. Did. Did the grandkids pay off the bill from World War II? Like, I don't know. Seem to work out. Okay. I don't. Yes, I totally agree. Them. What's. What is the alternative? Show me an alternative first, and then I'll start worrying.

[Michael Batnick]

Yeah, so I thought. I thought it was well said. All right, Ben. I saw what you did here, by the way. We could talk about this in a sec. Okay, I'm gonna. I'm gonna out. My beloved partner, Chris Venn, who is the ire of one of my pet peeves. Don't tell me you're. You're five minutes away when you're really? 45 minutes away. Why do that? Why do that? He does this repeatedly. I FaceTimed him. He was in the shower. He said, I'll call you back in five minutes. He called me back in an hour. All right, I get that. Like, I'll call you back. I get it, you know, but. But that's an expression. I'll call you back in five minutes. But I was meeting him at the dock to go ride in on jet skis, and he said, I'm at Belmore Avenue. I'll be there in a minute. No, you won't. You're 14 minutes away. Why say that?

[Ben Carlson]

Okay, I do that sometimes. Where I'm still at my desk cleaning stuff up and getting ready to leave for the day. And I'll text my wife, hey, on the road. See you soon.

[Michael Batnick]

That's fine. Well, on the road, but here's credit to me. I am. If I'm, like, 17 to 20 minutes away, that's what I say. I don't say five minutes away.

[Ben Carlson]

Why would you, Waze? Makes it easier to know those times now, too, right?

[Michael Batnick]

Yeah. Just. Just tell me exactly how far away you are. Don't. Okay, here's. Here's a email etiquette tip. Not to sound too.

[Ben Carlson]

I haven't had one of those in a while. The funny thing is, is that a handful of our emailers now will say, ps, I hope I didn't break any of Michael's rules.

[Michael Batnick]

And guess what?

[Ben Carlson]

People are walking in eggshells around you. None of them.

[Michael Batnick]

None of them do. None of them do. A little pro tip here. Although this is such a weird thing to do. This is not even like a. It's not even, like, nitpicking. It's just, you know, come on, don't do this. Somebody sent me a text message. What's your email number? What's your email address? An acquaintance, right? This is not a friend of mine. An acquaintance, barely. Although I do like a nice guy, so no heads up. And this. This part I could forgive, Although I don't like to see their action. Actually, you know what? This bothers me more than the. The pet peeve. The nitpick. So he connected me with somebody who can offer me nothing, and I'll take the meeting because he asked me to, but, hey, give a heads up. Like, hey, you mind if I connect you with this guy? Cause I would have said, like, actually, I kind of do mind. I have no use for that guy. I can't help him.

[Ben Carlson]

I'm done with this guy.

[Michael Batnick]

I can't help Him. All right. But that's not. That wasn't even the part that I led with or that came to mind. It's this part. So this person clearly asked for an intro to me, which I. That makes me feel good. Thank you. But he. This person who made the intro, copied and pasted into a new email and then signed off and clearly separate texts. So it's now obvious to me that he just copied and pasted what the guy told him to send. Don't be so lazy.

[Ben Carlson]

Right?

[Michael Batnick]

Right. It was like the texts weren't even remotely close. It might as well have been 14 point purple versus, like, 11 point black.

[Ben Carlson]

See, this is why you need to just train AI in the future to, like, look out for these email etiquette things. That's going to be.

[Michael Batnick]

It's the little things. That's all I'm saying.

[Ben Carlson]

Okay. I have a. Probably a mild case of ocd, so sometimes I just have a pen in my hand when I'm doing stuff. And. And you commented on it a couple weeks ago, like, why do you have a pen in your hand? I don't. It's just. It's something to do. Again, mild ocd. And yesterday we were doing a podcast.

[Michael Batnick]

You know, I saw you smiling, and I was about to say, what are you laughing about? And when I saw this picture in the doc, I knew what you were laughing about.

[Ben Carlson]

That was it. So I snapped a picture of you. You did the pen in the mouth, the whole podcast. And I didn't know if that. If you were trying to, like, make fun of me or you actually, just. Because sometimes it just is nice to have a pen in your hand.

[Michael Batnick]

So the pen is on my desk. I almost never have a pen on my desk because why would I have a pen on my desk? I don't write. Do you write?

[Ben Carlson]

Occasionally, I'll write a note to myself, but it's very. Yeah, it's not as much as I. I have a whole, like, cup full of pens that just never get used.

[Michael Batnick]

Okay. So I had to sign documents the other day, and now I've got a pen up here, and I. I kind of get it.

[Ben Carlson]

It's useful, right? Yeah. Okay, I get it. I got a story. Taking your dog for a walk. When you take your dog for a walk and you pass someone else taking their dog for a walk, there's this constant. Cause my dog's still a puppy. She's like 11 months old. You worry that your dog's gonna be a little spaz or freak out or, like, bark and make you look like an idiot, right? So the other day, the other day we were walking by and usually my dog, she's fine. She's a little. She's like ten pounds, tiny, more bark than bite. Usually she's fine unless the other dog makes a noise. Then she'll freak out, you know, and I have to pull her back. But the other day she kind of did one of these and jumped at the dog, you know, and the other guy, I was a little like one of those little bulldog kind of, I don't know, not a bulldog, but English bulldog or whatever.

[Michael Batnick]

A French bulldog or a bulldog.

[Ben Carlson]

There you go. French, not English. And the owner goes like to the dog. Good job, Denny. For not like freaking out, like kind of like, you know, and I'm going to be like, dude, come on. But isn't it. You always. You feel good when your dog doesn't freak out, but the other one does, right?

[Michael Batnick]

Yeah.

[Ben Carlson]

Well, yes, That's a great, that's a great feeling.

[Michael Batnick]

I have extreme anxiety about dog walking. I am not prone to anxiety and I didn't really know what the feeling was in most of my life. But my other, my first dog, Bianca, we used to take her to the dog park all. Every single weekend. And she was great. Got her energy. Boxers have a lot of energy. And when she turned one, something in her behavior changed where she would get into fights every single time we brought her to the point where I had to stop bringing her. And she's the sweetest angel, but around dogs she would get aggressive and so I felt like my. My balls in my throat. Like it was just an awful feeling walking her. And so now that I've got like my new boxer, like I took her for a walk the other day and two dogs came over and like I just felt it again. I was like, oh, like a very uneasy feeling. And she made it, but I am nervous.

[Ben Carlson]

Yeah, you do like the. Wrap the leash around your hand a couple times to get them closer. But I love my dog has a lot of energy too for a puppy. So I take her for like two walks a day and it's kind of, kind of nice just to out of the house and. All right, let's do recommendations.

[Michael Batnick]

Okay, I've got a bunch. Somebody emailed us. I can't remember what the exact email was, but recommended the way, way back.

[Ben Carlson]

And wait, is that the Ben Affleck one or the Summer one?

[Michael Batnick]

The Steve Carell one.

[Ben Carlson]

Okay, that's funny cuz I really like this movie.

[Michael Batnick]

Okay, I know you do.

[Ben Carlson]

Okay.

[Michael Batnick]

So I watched the first 45 minutes of it. And it's just. These are just not my type of movies.

[Ben Carlson]

Coming of age.

[Michael Batnick]

Yeah, coming of age. You know, not. Not a whole lot happens. And I turned it off and. And like, I gave, like, a few different sittings. I watched it for 15 minutes here, 30 minutes there, and then I was like, I. I get it.

[Ben Carlson]

So here's what I. But this is.

[Michael Batnick]

This is. I thought, like, Ben must love this movie.

[Ben Carlson]

I do. The kid in the movie is not very good, but it's got Steve Carell playing a jerk, and. And he's pretty good at playing a jerk. Sam Rockwell, who I love, and then Maya Rudolph. So I love the whole summer working at a water park thing. It's a great.

[Michael Batnick]

I didn't not like it, but, like, whatever. It's a Ben movie.

[Ben Carlson]

See, those are the kind of movies that you watch them in the summer, and it puts you in a good mood.

[Michael Batnick]

Sure. All right. Tire Season two, like, laugh out loud. Funny. I can't believe season one was, frankly, junk.

[Ben Carlson]

I didn't even crack a smile in season one.

[Michael Batnick]

Yeah, I don't think I did either. I'm literally lol ing. Thomas Hayden Church as Shane's dad was incredible.

[Ben Carlson]

I love Thomas Hayden Church.

[Michael Batnick]

What a season. Right? Like, just. And I love that the episodes are 23 minutes long. Like, it's nothing.

[Ben Carlson]

I think the. The dorky guy who plays the boss or the manager, he was so much.

[Michael Batnick]

Better than in season one.

[Ben Carlson]

Yeah, I mean, it's a. It's a ripoff of the Office in a lot of ways, but just a little more crass because it's at a tire repair shop or whatever. But it's those workplace comedies, they almost always work.

[Michael Batnick]

Okay. I saw Bring Her Back in the theater. Bring Her Back is. Is the movie that was done by the dudes who did Talk to Her. Talk to her was a mainstream ish horror movie. There's some laughs. It's fun, it's scary. It's. It's. It's a little bit light in certain places. It's a good watch.

[Ben Carlson]

This movie looks psychotic from the poster.

[Michael Batnick]

Okay. You could watch. Talk to her and have a good time.

[Ben Carlson]

Okay.

[Michael Batnick]

Okay. Bring Her Back was soul sucking. It was the darkest movie I might have ever seen. It's up there with Speak no Evil and Not Speak no Evil. Damn it. The Dark and the Wicked and Something Evil.

[Ben Carlson]

I can't remember how they not run out of names for these movies.

[Michael Batnick]

Just. Dude, this was pure black. Did I enjoy it? Kind of. Oh, my God, this movie hurt. So this is for sickos only. So suddenly, Ben, this is not for you. Wow. Credit to them. They. They really did it. Just.

[Ben Carlson]

This movie hurt after that description. I can't believe you said, I actually kind of liked it.

[Michael Batnick]

It physically. It physically. I'm a sicko. I'm a sick puppy. It physically hurt to watch. All right, lastly, I saw. I took the boys to see how to train your dragon in imax. And we walk into. Logan goes, whoa, that's a big TV screen. And it is. And this was, I think, the best kids movie I've ever seen.

[Ben Carlson]

Wow.

[Michael Batnick]

Like, with your kids, you mean with my kids? I can't believe how good it was. I had. I was certainly. I was more expecting, like, to be on my phone. And the plot is. It's kind of like Free Willy, but with dragons. Remember that movie?

[Ben Carlson]

Oh, yeah.

[Michael Batnick]

Just fantastic. It's gonna do half a billion.

[Ben Carlson]

I think kids are gonna love this one, huh? It was my kids. Can't wait.

[Michael Batnick]

And not just kids. You're gonna have a great time. It was so, so good. Shockingly good. So if you have a child of age, go see that movie.

[Ben Carlson]

Okay. My daughter and I are still going through our sports movies. We started Miracle this week. And the credits for Miracle at the beginning. This is like a 2004 movie.

[Michael Batnick]

I never saw that one. I don't know how I just missed it. Kurt Russell.

[Ben Carlson]

They go through, because it was the 1980 Olympics that this happened. Right? And do you believe in miracles? And they show the 70s how awful they were. Like, it's just this constant barrage of, like, the seventies are so bad. And it was kind of like how this was an uplifting moment for the country after the terrible 70s. It's funny that I feel like the sentiment of the 2000s and all the crazy stuff that's happened kind of almost feels like it matches the 70s. But we've also had a good economy and a booming stock market. Like, it's weird to think the 70s had a lot of bad stuff happen, but also a terrible economy and a terrible stock market. Like, we. At least we've had some crazy things happen, but at least, like, that stuff is going okay. So I think there's a lot of TV shows that should be miniseries and miniseries that should be movies. Like, the better Sister. I finished it. Probably not for you, now that I think about it. That should have been. It should have been a movie because there's three episodes that were totally unnecessary. And then at the end, they hurried the last 20 minutes, like, shoved all this stuff in there and didn't explain it. So it was decent. But it should have been a movie. And the Handmaid's Tale that we finished, that should have been a mini series. Because I read the book now. Chris talked me into reading the book and the book is fantastic and it actually makes the TV show better. But it made me realize that the TV show was way too long.

[Michael Batnick]

So this is the last season.

[Ben Carlson]

Yes. And I didn't realize that the book is written in like 1985. It's really, really good. And finally, Chris Hutchins was on Tim Ferriss this week. This past week. Chris from all the Hacks. Friend of the show. I'm going to be on his podcast soon. I recorded it last week. I don't know when it's coming out, but he talked about. He is like the most optimized points person there is. And there's kind of like a dark web for credit card points. He was talking about how he's buying $300,000 worth of gold bars on Costco for the points and selling. Reselling the gold bars and like making the difference and buying a million dollars worth of cards on Amazon, gift cards on Amazon for resale because he can somehow get the points. It shows you how crazy this is. Like this is what you're up against in the points world because Tim Ferriss. Tim Ferriss has 15 million points because he's never spent a dime of his points, even from all his business cards.

[Michael Batnick]

What does he say? Why is he doing that?

[Ben Carlson]

He's just decided never to do it. So Chris is giving him advice on what he should do. Those 15 million points.

[Michael Batnick]

Okay.

[Ben Carlson]

Very interesting episode.

[Michael Batnick]

Did you see the sapphire reserve is now going to 795?

[Ben Carlson]

I'm out.

[Michael Batnick]

Well, they're also. They're also increasing their benefits to $500 cash back.

[Ben Carlson]

I'm so out. That's too much. Sorry. See you later, Chase.

[Michael Batnick]

Okay.

[Ben Carlson]

Too much inflation. There's other cards. It doesn't. I'll.

[Michael Batnick]

We'll report back next week. I have some. Maybe some work to do there. Lastly, I know we're. By the way, I could feel Duncan sweating. This is probably the longest pod we've ever gone. I saw 45 pages in the doc, so thank you, Duncan, Daniel and the rest of the out for justice rewatchables you have to listen to was laugh out loud. Funny. Now, mind you, I don't think I've ever seen this movie. It's Seagal's first big hit. Or I might have seen it when I was a child. I don't remember.

[Ben Carlson]

I saw all the Seagal movies back then. Here's my problem. I don't really like the. I like this movie ironically. That doesn't do it for me.

[Michael Batnick]

How could you like Seagal movies unironically? That.

[Ben Carlson]

That's the thing. You don't. So I don't. I don't get the point of liking something ironically. I don't get that.

[Michael Batnick]

Just. I'm telling you, just listen to the podcast. It is so funny.

[Ben Carlson]

All right.

[Michael Batnick]

It is so funny. Some of the Seagal stories are hilarious.

[Ben Carlson]

Okay. All right. I was a big fan of Under Siege, of course. Under Siege two.

[Michael Batnick]

Under Siege might have been the first time I saw a naked woman on the screen.

[Ben Carlson]

All right. Congrats to you. All right.

[Michael Batnick]

It might have been Terminator 1 with Linda Hamilton. I remember my dad putting his hands over my face and fast forwarding.

[Ben Carlson]

Okay, you can come up with your top 10 list of naked women you've seen at a young age.

[Michael Batnick]

Desperado number one. That's obvious.

[Ben Carlson]

Shoot us an email. Animalspiritsompoundnews.com we'll see you next time. Don't get.