Big Tech Is Fun Again & The Fed Speaks

Summary

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Motley Fool Money — "Big Tech Is Fun Again & The Fed Speaks"

Date: September 19, 2025
Host: Travis Hoyam
Guests: Lou Whiteman, Jason Moser

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Episode Overview

This episode dives into several major topics impacting investors: the Fed’s latest rate cut and what it signals for the economy, a deep look into Nvidia's $5 billion deal with Intel, the practicality (or lack thereof) of Meta’s new AI-powered Ray-Ban glasses, and the evolving landscape of “agentic commerce” in AI, featuring Google/PayPal’s new partnership. The team wraps up with insights from David Gardner’s new book, “Rule Breaker Investing,” and their stocks to watch for the upcoming week.

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Federal Reserve Rate Cut: Implications & Market Response

[00:40]–[08:23]

• Fed Cuts by 0.25%:
  The Federal Reserve announced a 25 basis point rate cut, aiming to mitigate economic slowing while acknowledging continued complexity and uncertainty.

• Market Reaction:
  Stocks near all-time highs, but concerns remain about the underlying signals.
  Lou: “The Fed is sort of sounding the alarm ... we had a very, very complicated economic situation with tariffs ... and the Fed is sort of confirming, yes, there's a lot going on here and it's only getting more complicated.” (01:28)

• Policy Guidance:
  While the Fed didn’t explicitly promise more cuts, its “dot plot” implies further cuts may be coming this year—shifting the narrative from fighting inflation to fighting rising unemployment.

• Mortgage & Consumer Loans:
  Although the Fed sets short-term rates, longer-term rates (like the 10-year Treasury) rose—a mixed result.
  Jason: “We saw applications to refinance home loans ... up 58% versus the previous week. It was 70% higher than the same week a year ago ... but purchasers clearly are still on the sidelines.” (07:09)

• Long-Term Market Outlook:
  The panel notes that the Fed has limited power—other factors like US debt, tariffs, and global trends matter. The old belief that the Fed can fix everything is waning.

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Nvidia and Intel: Partnership or Lifeline?

[08:23]–[12:45]

• Nvidia’s $5B Investment:
  Nvidia is set to invest $5B into Intel, following government moves to convert grants into equity. This brings together two major semiconductor players as Intel seeks relevance.

• Nature of the Collaboration:
  More than foundry work, this partnership will see tighter integration between Intel CPUs and Nvidia’s AI chips and GPUs.
  Lou: “I think intel is a winner here. But gosh, I feel for AMD because AMD has to compete with both of these guys ... having your two biggest rivals working together, it feels like you're ganging up on AMD.” (10:05)

• Bigger Picture:
  Possibility for even larger industry-driven funding of domestic semiconductor manufacturing (akin to ASML in Europe). But both Nvidia’s Jensen Huang and the panel agree: money alone won’t recreate TSMC’s “magic.”
  Lou: “Jensen Huang said ... ‘Taiwan semi makes magic. So we don't just need money, we need the magic of that.’ He sounded pretty skeptical of just recreating Taiwan Semi at Intel.” (12:25)

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Meta’s New Ray-Ban Smart Glasses: Tech’s Next Platform or Overhyped?

[13:57]–[19:44]

• Meta Doubles Down on AR:
  Despite huge losses in VR/Metaverse, Zuckerberg pushes forward with smart glasses—new models offer AI integration, real-world querying, and messaging.

• Panel Response:
  Respect for persistence, but doubts about mainstream appeal.
  Jason: “They're coming along, but they're still not fully there yet. But I do see a lot of promise ... I think a lot of it is really just finding those killer apps, why we need these devices.” (14:47)
  Lou: “Everything you talked about was cool, but all things I can do with my phone ... you need to have a killer app that differentiates from the phone.” (16:13)

• Competitive Landscape:
  Google partners with Warby Parker; Snap struggles after six generations; Amazon enters both retail and delivery glasses.

• Generational Divide:
  The younger generation hasn’t shown clear interest; could be a “want,” not a “need”—similar to smartwatches, but with more skeptical economics.

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Rule Breaker Investing: David Gardner’s Approach & Lessons Learned

[20:31]–[29:39]

• David Gardner’s Book Launch:
  “Rule Breaker Investing” provides lessons from Motley Fool’s long-term, high-conviction stock picking.

• Key Lesson:
  Big winners (the “100 baggers”) are the core of long-term outperformance.
  Travis: “Those winners are the point. That is the point ... That is the entire goal is to have the mindset to be able to find those stocks and then hang on to them for decades.” (22:59)

• Holding Is Hard—but Essential:
  Jason: “It is. The value comes in the holding of those, of those tremendous companies ... David Garner ... taught me how to look at things differently beyond sort of the conventional thinking ... adding to your winners can be a very powerful strategy, particularly over, over long periods of time.” (23:20)

• Investor Mindset:
  The Fool’s philosophy emphasizes building long-term relationships with companies—buy the vision, not just the near-term numbers.

• Uncertainty Fuels Opportunity:
  Travis: “There's something too about buying a culture ... and sort of understanding that there is uncertainty. And that's the point and that's the upside that you don't get that upside by, by having all the answers.” (27:14)

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Google & PayPal: Agentic Commerce and AI Integration

[31:06]–[37:56]

• Agentic Commerce Defined:
  The new Google-PayPal partnership is meant to enable “agentic commerce”—AI agents handling purchases, searches, and transactions for users.

• Skepticism on Real-World Impact:
  Jason: “It sounds like a big deal ... but the process ... there are a lot of things that have to go right ... customer or consumer adoption ... historically, the E-commerce hype cycles are just notoriously overhyped.” (33:31)

• Best Use Case?:
  Consumer use is uncertain (would you want your fridge automating groceries?), but AI automation may prove most valuable in large enterprise settings (like automated supply chain orders).
  Lou: “It makes so much more sense for a corporation than it does for ... consumers.” (35:10)

• Google’s Platform Advantage:
  The key advantage may be Google’s distribution—they can roll out new features to billions via Chrome and Android.
  Jason: “If Google can just roll out all of these features and all of this technology that makes that experience better and more seamless ...” (37:37)
  Travis: “... for free. We also need to bring that up is that ChatGPT runs on subscriptions. Google has an ad business.” (37:44)

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Stocks on the Radar

[38:06]–[40:54]

• Lou: FedEx — Beat lowered expectations, showing green shoots in a cyclical industry hit by tariffs. “I think we be nearing time where this works again.” (38:06)
• Jason: Costco (COST) — “Boring” company, but shares up 180% in five years, with membership renewals as a core metric of value and growth. “Renewals just continue to impress ... 92.7% U.S. and Canada renewal rate.” (39:20)
• Dan’s Pick: FedEx, for the strong brand and intriguing turnaround.

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Notable Quotes & Memorable Moments

• Lou: "I don't think we are just doomed to just the plane is going to crash from here. But I also don't know if it's a reason for celebration." (01:28)
• Jason: “The Fed is not the economy. ... This isn't the Wizard of Oz here.” (06:34)
• Lou: “Everything you talked about was cool, but all things I can do with my phone. ... I think you need to have a killer app that differentiates from the phone. And I'm not sure if I've, I've seen that Yet.” (16:13)
• Travis: “Those winners are the point. That is the point.” (22:59)
• Jason: “Adding to your winners can be a very powerful strategy, particularly over, over long periods of time.” (23:20)
• Travis: “There's something too about buying a culture ... and sort of understanding that there is uncertainty. And that's the point ...” (27:14)
• Jason: “Agentic commerce is a new form of commerce where autonomous AI agents act on behalf of consumers to search for, purchase, and receive goods and services. ... a little bit more difficult to actually execute.” (33:31)
• Lou: “Not buying Meta display glasses, not buying stuff with agents, just a grumpy old man.” (36:06)

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Episode Structure

• Fed & Economy: Discussion of rate cut, economic signals, long-term market shifts
• Big Tech: Nvidia & Intel’s partnership, implications for chip industry
• Consumer Tech: Meta’s smart glasses, platform ambitions, generational perspectives
• Investing Philosophy: Rule Breaker approach, mindset shifts, real-life winners
• AI & Commerce: Google/PayPal’s agentic commerce, Chrome as an AI platform, practical use cases
• Stocks to Watch: FedEx, Costco, with analysis and a lighthearted logo discussion

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For long-term investors: the episode’s core theme is not only navigating macroeconomic uncertainty, but also understanding how technology innovation, investor mindset, and business models—often ahead of market consensus—shape durable outperformance.

Transcript

[A]

Will Nvidia be Intel's savior? Motley Pool Money starts now.

[B]

Everybody needs money. That's why they call it money.

[C]

Are free.

[B]

But you can give them to the From Fool Global headquarters. This is Motley Fool Money.

[A]

Welcome to Motley Fool Money. I'm Travis Hoyam, joined this week by Lou Whiteman and Jason Moser. We have a lot to cover today, from changes to Chrome Meta's new AI glasses. But we have to start with the elephant in the room and that is the Federal Reserve. We got our rate cut, guys. The Fed cut rates, the Fed funds rate, which is a short term interest rate by 25 basis points, which is a quarter of a percentage point. The commentary was interesting because basically they said that there was two bad options. You either let inflation run by cutting rates, but you also have a worsening economy which isn't good for investors long term, it's not good for employment, things like that. So this is getting obviously a lot of attention. But Lou, is this a big deal for investors or is this just the noise that normally happens in the market?

[C]

It is a big deal for investors. I mean we should know too that stocks were what, near all time highs or celebrated the news. I worry about that part of it because Travis, to your point, what's going on here is the Fed is sort of sounding the alarm. I don't want to overstate, I don't want to be Chicken Little here. I don't think we are like headed towards 2008 all over again. But the bottom line here is that we had a very, very complicated economic situation with tariffs. We were expecting a slowdown last year, it never came. All of this going on and the Fed is sort of confirming, yes, there's a lot going on here and it's only getting more complicated. I hope that works out well for us. Again, I don't think we are just doomed to just the plane is going to crash from here. But I also don't know if it's a reason for celebration.

[B]

Yeah, I think, I mean that's basically right. I would say, I mean we most, I think most of us expected that, that 25 point basis cut. I think the bigger headline maybe was, was the commitment to two additional cuts for the rest of the year. I mean, they only have two meetings left to begin with. So it sounded like they're already sort of saying, listen, you can expect more and getting out there and explicitly stating that.

[A]

And to be clear, what is that commitment? Because they don't, they don't explicitly say we're going to Cut it to cut rates two more times. But they kind of give this hand wavy indication with.

[B]

Yeah, and you see the dot. Exactly. The dot plot thing which basically kind of gives you, it's, that's that anonymous sort of graph that sort, it shows you where all of the Fed governors stand on the matter. There was some discrepancy there. I know some were thinking maybe a 50 basis point cut made more sense. I mean, to me, I always kind of think slow and steady wins the race here. There's no reason to overreact. But it has gone from this battling inflation narrative, which inflation is still higher than the target, but it's somewhat in check, to now battling unemployment. And I think that's really noteworthy given the recent downward jobs number revisions. Right. I mean that was a big revision at 900 plus thousand jobs were basically wiped off the books there. So it's gone from this sort of battling inflation narrative to now we're potentially going to need to battle unemployment in like you both noted, I mean it's showing signs of a weaker economy. So either way, I mean these are just tools that the Fed can use to try to combat those things. It doesn't necessarily mean it's going to work, but I mean I, I think it's fair to say that we, we probably will see them continue in this cutting mindset for some time because it sounded like they wanted to get that down to about a 3% target, which right now I think it stands at 4 to 4.25.

[A]

Now guys, when the Fed cuts rates, the, the entire idea here is to make it easier for people to buy vehicles, to buy houses, for businesses, to borrow money. That's, that's the idea of lowering rates because when you, when you lower them makes that cost of capital a little bit lower. The interesting thing was the reaction from the market because the Fed sets the short term rate, that fed funds rate, but they do not set the 10 year, the 20 year, the 30 year. And the 10 year is kind of the benchmark that things like mortgages are set on. That was actually up about a tenth of a percentage point this week. Lou is, I mean, what do we make of that? Because I think the story that the market has been talking about for six months is we got to cut rates and that's going to help the cost of capital, it's going to help business. But then if the long term rates go up, that's exactly what you don't want.

[C]

Yeah. So two big picture thoughts here. For one, I think the market isn't questioning The Fed. But I believe that we went through a period where there's almost the cult of the Fed that the Fed can just the masters of the universe that can just cure all ills. And this is a relatively new phenomena. If you go Back to the 70s, the Fed was being made fun of as the Fed can't do anything. So this idea that the Fed can just solve all of our problems is relatively a new phenomena. And I think it's beginning to break because the truth is Jason mentioned that the Fed doesn't really have a lot of control. They have a couple of blunt instruments and those instruments don't always work. They don't work immediately. And even when they work, they can work in odd ways. The other thing going on here too is just look, the market is looking at a lot more than the Fed, all right? And these long term rates, where's the US debt going? Where is long term inflation rates and tariffs and trying to insure and all of that? These are maybe not offset the Fed, but these are just pulling in different directions than a near term rate cut. So I think the market is acting rationally. It speaks to the limits to the Fed. And also sort of this maybe the idea that maybe they're still in the markets. There seems to be an impression that if the Fed acts, everything will be fine. I think that explains why we rallied after it. But I don't know if the, you know, the bond markets really subscribe to that.

[B]

Yeah, the Fed is not the economy. I mean, I think you put that very well there. It's. We've seen this, this going from one extreme to the other where it used to be seen that they couldn't really do much and now this, this perspective that, oh well, whatever the Fed says, that's going to change everything. I mean, this isn't the wizard of Oz here. Right. It wasn't terribly surprising one way or the other in regard to longer term rates. To your point, Travis, I do think, I mean, the Fed cutting rates can have an impact on consumers in the near term. Absolutely. It's going to be very modest, but it absolutely can. Now when you start talking about things like mortgage rates.

[A]

Yep.

[B]

I mean, you're right, they're pegged towards longer term instruments. So it doesn't necessarily mean mortgage rates are going to come down. I did think it was interesting to see mortgage activity did pick up a little bit last week. We saw applications to refinance home loans. That was up 58% versus the previous week. It was 70% higher than the same week A year ago and the refinance share of mortgage activity increased to almost 60% of total applications versus just under 50% from the previous week as well. So there is some activity picking up, but purchasers clearly are still on the sidelines. And I think that's going to be something that's going to need to pick back up to really kind of boost the housing market. Right. And that, that in turn can stoke some growth and maybe take advantage of this, of this lowering interest rate environment. But I mean, keep an eye on companies. The one I'm watching, Rocket Companies, a company I recommended recently in one of our services, I mean that's their game, right? Mortgages. And They've got this Mr. Cooper acquisition closing at the end of the year, which is essentially going to make Rocket the largest mortgage servicing company in the world. And that is very attractive from a financial standpoint. A lot of sticky recurring high margin revenue there.

[A]

Mortgages are going to be something to watch, but that is a little bit of a longer game. The ebbs and flows are years and decades. The one to maybe look at for more short term is going to be what does the auto business look like in the third quarter? And then also what do they think for the fourth quarter? And eventually we'll get guidance for 2026. Things have been pretty good, especially selling big trucks and SUVs as those interest rates kind of eat up a little bit more of your costs. Maybe that doesn't continue, but we will see as earning season rolls along. I did want to touch on Nvidia and Intel. This was really the big story kind of the middle of the week. Nvidia agreed to invest $5 billion in Intel. This is after the US government basically converted some grants and stuff like that to equity. I don't know if that deal has actually closed, but. But this agreement really pulls together the power player in the semiconductor space right now. Nvidia gives intel maybe a little bit of a lifeline. Lou, is this something that is actually going to help save intel or is this. $5 billion is a lot of money to me and you. Maybe not a lot of money if you're building a foundry.

[C]

Travis, it would really help with my. Yeah, yeah, yeah. Five billion would make a dent with me. And look, shout out. Jensen Hong really does have the Midas touch.

[B]

Right.

[C]

You know, he's already up 25% on that investment based on that. So well done.

[A]

I think it does.

[C]

And the interesting to me, when I first saw this, I assumed it was just Foundry.

[B]

Right.

[C]

It was just going to Be Nvidia would source chips, you know, just have intel built.

[A]

Right. Because intel needs buyers for their Foundry. They basically said, we're not going to build out this next generation if we don't actually have customers, which they currently don't. Is sort of a chicken and egg situation they're in right now.

[C]

Right. But this doesn't involve Foundry. It involves just kind of working together to integrate intel processors with Nvidia's AI chips and their graphics chips to kind of create a more streamlined solution. I think intel is a winner here. But gosh, I feel for AMD because AMD has to compete with both of these guys. I mean, I don't think they're cooked now, but having your two biggest rivals working together, it feels like you're ganging up on amd. I think this is definitely a positive step for Intel. I don't know if it saves them, but it's $5 billion and a powerful partner. There's a lot to like there.

[B]

It's definitely a bigger win for Intel, I'd say. I think that we would all agree there that Nvidia, I mean, you just look at how the companies have performed over the last five years alone. You've got intel revenue actually down 7.5% on an annualized basis, while Nvidia is up a whopping 66%. So we kind of know what the market is telling us there. And this deal focusing on specifically PCs and data centers, I think that is encouraging just given what we know about the growth in data centers and really how darn good Nvidia is at this stuff. But, I mean, listen, Nvidia still has a clear incentive here, too. That $5 billion investment comes at a price of $23.38 per share. You base that on the closing price of intel today. That' $30. It's a nice little discount and it could work out well if the partnership flourishes.

[A]

Now, it's not necessarily Nvidia's job to save intel, but they do have an interest in having a second source. You know, Lou talked about that. This doesn't necessarily include the Foundry, but I've seen reporting that there's sort of. It could include the Foundry in the future, but they're going to need more than $5 billion to actually get that Foundry business up to competing with tsmc. Now, this isn't my idea, but one of the things that I've seen floated is now that the government's involved, now that Nvidia is involved, why don't we just get $100 billion or so from some of the big tech companies. Nvidia, Google, Apple, Amazon. That's kind of pocket change for them. And build this, you know, domestic U.S. supplier and second source. That should be kind of a win for everybody. There is actually precedent here. You know, ASML was saved by the industry. You have ARM was effectively saved and funded by the industry. So this has happened before, but we're talking about a lot of money. Lou, is this something that could potentially be in the works?

[C]

It could. I mean, now note that from Nvidia's perspective, Jensen Huang said that. I believe the quote was, Taiwan semi makes magic. So we don't just need money, we need the magic of that. He sounded pretty skeptical of just recreating Taiwan Semi at Intel. But look, it, it makes sense. If you want a national champion. Let's go all in, huh?

[A]

Next up, we are going to find out if Lou is going to be buying Meta's new Ray Ban glasses. You're listening to Motley Fool Money.

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[A]

Welcome back to Motley Fool Money. When Mark Zuckerberg has an idea media, he really sticks to it. Despite burning $50 billion plus on the Metaverse and VR, he is pushing forward with AR glasses. You got to give him some respect here for really sticking with it. They intro, they announced the Meta Ray Ban display glasses. This is going to bring artificial intelligence tools basically to your eyes. You can kind of talk to these glasses. It's got a camera on it so it can. You can ask questions about the real world silent interactions like responding to WhatsApp messages. If, you know, we're not distracted enough driving, maybe we'll be distracted while walking now too. Jason, what was your reaction to this? I have to respect them pushing forward, but is this ultimately a product that's going to matter for Meta as a company?

[B]

I do respect them sticking with it. I also agree with you. It does seem like they would be a bit distracting. I mean, having having been a part of our immersive tech technology service here for some time. I mean, I continue to root for the technology, but it's still nascent in its development. And you've got form factor, the technology. They're coming along, but they're still not fully there yet. But I do see a lot of promise. And they're not the only ones in the market too. Right. We got Alphabet now with a partnership with Warby Parker. Meta, of course, we're talking about Snap. Speaking of sticking with it, they're on their sixth generation, ultimately to no real avail there. So that's a little concerning. And then to top it off, Amazon now is also vying for share in this market, working on both consumer glasses that are operating under the codename Jayhawk, and then they're also actually working on delivery driver specific glasses to aid delivery drivers with things like maps and directions. So that could be interesting. Yeah, I mean, that's a good use. That's a good use case right there. Language translation, I think, is another great use case for things like these. So I think a lot of it is really just finding those killer apps, why we need these devices. And I think it's happening slowly but surely. There are things that these devices can do very well, I think, in time. I mean, listen, I understand why Meta's trying, and they're kind of leading the way here at this point.

[A]

Lou, you're an early adopter with a lot of this technology. $800. Where are you on the waiting list here?

[C]

So here's the thing. I think I'm much more of a normal and trying to think as a normal normie. I'm skeptical here because, guys, here's the thing. Travis, everything you talked about was cool, but all things I can do with my phone. All right? And I'm already spending 800 bucks for my phone. I don't know if I, if, if normies like me are going to spend another 800 bucks to replicate, even if the form factor is cooler. Okay. I think you need to have a killer app that differentiates from the phone. And I'm not sure if I've, I've seen that Yet I don't want to be totally dismissive. I think it's a neat idea. But look, even on the directions, if I'm driving and I'm using my directions, it's better somehow shut off all the other apps so I can't be watching a YouTube video while I'm driving. There's just a lot of, like, real world practicality out of the. This is cool that I'm skeptical. And look, I hate to say this, but with all due respect to Mark Zuckerberg since Facebook, what has he come up with that people actually want to use?

[B]

It's a fair observation. And I mean, to your point. Yeah. I don't know that this is necessarily the new computing paradigm. Now, on the flip side of that, Meta Chief Products Officer Chris Cox is standing very firm. They believe that smart glasses are the future computing platform. I am skeptical of that. I am truly skeptical of it because I don't think that's. Everybody's got a smartphone these days. I don't think the market opportunity is as large as the smartphone. Maybe I'll be proven wrong in time, but I mean, I look to the younger generation of consumers today to see is that something they want or need. Right. I look to my kids, their friends. I mean, they're not interested in this stuff either. So if this is something that's going to happen, it's going to be a generational play, which means it's obviously going to take a while.

[C]

Here's a question I have for both of you. Can it be a hit if it's a just want and not need?

[B]

Sure.

[C]

It's kind of like the watch market, you know, I mean, the watches are a compliment to our phone. They haven't replaced our phones. We're not Dick Tracy ing everywhere, you know, talking to it. It's still kind of a hit. Right. But I mean, so I don't know, maybe I'm setting the bar wrong.

[A]

The challenge is at this level of spending, they've got to cover that operating cost with revenue and gross margin and profit on. And I think that's really the challenge, people. It's. It's hard to understand how successful the iPhone is because they have such incredible scale making a piece of hardware. And this is what I quickly. I want to just touch on. Mark Zuckerberg has been talking about wanting to have a platform business. This is why he part of the reason he named the company Meta Platforms, even though none of the businesses are really platforms, they're more applications. So, you know, Lou, is this him? Sort of Sticking with this because he needs this kind of product, just kind of. Because that's what he wants to be. He wants to be Microsoft, he wants to be Alphabet or he wants to be Apple. But that's not actually what Meta's business is. And that could make them throw good money after bad.

[C]

I think you said it well, I mean, you said at the top he sticks with something. Look, there are better ecosystems out there, period. I mean, what Meta is. Meta is an amazing ad revenue generation machine and I will not take that from them. But I see nothing to suggest there are anything other than that.

[B]

Yeah, glasses notwithstanding, how much do you pay Meta on a daily, monthly or yearly basis? My guess is we're all going to answer zero, right? I mean, it's not directly anyways. Yeah, exactly. It's an ad business. And yet making up, making up the investments that they made into this hardware is going to be a high hurdle.

[A]

Yeah. And the other competitor in this space that we should acknowledge is Alphabet. They do have a platform in Android. That's what they sort of seem to be leaning on in moving into things like glasses and other wearables, even robotics. They have AI tools. So interesting to see where Meta stands next. When we come back, we're going to talk about Rule Breaker Investing. You're listening to Motley Fool Money. When you wake up in the morning and the light is red.

[E]

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[A]

Welcome back to Motley Fool Money. This week, Motley fool co founder David Gardner released his newest book, Rule Breaker Investing. So I thought this is a good opportunity to talk about some of the lessons that we've learned through Rule breakers, the service from David and I. I think one of the things, as I look back, I've got 15 years now writing for the Motley fool and I remember early on looking at the Rule Breaker service and you could see these huge outliers, but if you took those out, I remember downloading every single one of the stocks and all the returns and I took out, I think it was Priceline, Disney and it was actually Marvel. That was, that was the, the stock pick and then Netflix. Those are the big outliers. But if you took those out, you know, the performance was kind of, eh, it was market average. And I thought, you know what, they just got lucky. Right? You picked a couple of good stocks, you Just got lucky. Since then, since I did that exercise, Rule breakers has picked Tesla, which is actually the best performing stock in the entire portfolio and just continues to have these massive, massive winners. And as we think about Rule Breaker investing, and I was going through the book, listening to the book on Spotify, another favorite Motley fool stock, I just think this thinking about investing as you have only so much you could possibly lose on a stock, but the upside is so enormous. And I think that's the one thing that I have taken away from listening to David, reading David, Everything that the Motley fool does is those winners are the point. That is the point. The Netflix is the Tesla's, you know, the Marvel becoming Disney. Those aren't getting lucky. That is the entire goal is to have the mindset to be able to find those stocks and then hang on to them for decades. I think he said at the beginning of the book, now has. David now has seven 100 baggers. That is just a crazy number. So Jason, as you think about, you know, I think we, we started with the Motley fool at about the same time. What are the lessons that you think about, through about Rule Breaker investing that you know, has, have really changed the way that you think about investing in the market?

[B]

Yeah, you make a lot of good points there. I mean, Rule Breaker investing is, it's a unique approach and you kind of have to take the good with the bad, right? I mean, they're not all going to be home runs, but a lot of them will be. And you want to get to that 100 bagger. Well, you got to get to a two bagger and a three bagger and a four bagger first, right? It is. The value comes in the holding of those, of those tremendous companies.

[A]

And that's the hardest part. You see 100% gain and you go, man, I did it.

[B]

I think it's human nature to say that. And I think that the longer that you invest and the more that you hang on to those winning companies, the easier it gets. Right? I mean, I can look back and say, well, I'm sure glad I've held on Amazon since 2010, because that's worked out pretty well. I've had the good fortune to work with David off and on since getting here as part of the Stock Advisor team. And I enjoyed meeting with him and going through his process and learning sort of about how he approaches investing and views the world. He's just a tremendously optimistic guy and you just can't help but leave a room, leave a meeting with him, just Feeling inspired and optimistic. And that really is part of rule breaker investing as well, is being optimistic about the future. I think that one of the lessons that's always stood out to me, and I've said this, I think since pretty much I've been here, I've learned so much about investing from everybody with whom I work. But for me, I mean, David Garner is the individual who's had the most profound impact on me as an investor because he taught me how to look at things differently beyond sort of the conventional thinking. And one of those lessons that I continue to really appreciate is that concept of adding to your winners. Right? I mean, looking at these companies that are performing well in your portfolio and saying, all right, well why are the companies, why is that stock performing well? Well, chances are it's because the business is performing well. And isn't that kind of the goal to own good businesses for as long as we possibly can? So it. I. There was, there was sort of this value bent, I think, on the investing team when I first got here that was always looking for stuff on sale. I just think it's really important for investors to realize that adding to your winners can be a very powerful strategy, particularly over, over long periods of time. And that that's something I took away from working with David.

[C]

So much good stuff here. And yeah, echo everything you say. I'm the relative newbie here. I think I only got here 2016 and I came from very different places that don't have that, that don't follow all of these philosophies. The thing that's always struck me about Motley fool and I think it's, this is the founder's DNA running through it is just this mindset for lack of a better to, to form a long term relationship with the company instead of it just being transactional. You know, the old expression, you know, make your investing the vision of the future you want and kind of just to climb on board. It's all these things we're talking about with like long term adding to it, but just to not think of a stock as oh, this can run this week, or oh, this can. This is going to be under near term pressure. But to actually kind of say to, to get, to become a part owner, to be part of a business and to just make that business, you know, part of just kind of who you are and, and to run with it, just that mentality. And I do think that that helps you find winners because, you know, when you're thinking in those terms, you are actually sort of judging Something. It's not just, oh, I think I can get momentum here for a week. It's, oh, I looked at what they're doing, I looked at management, and I'm aligned here. I think that actually is almost a cheat code to finding good businesses because you're actually taking the time to get to know them, to learn them, if that makes sense.

[A]

It seems like those intangibles, too, are something that a lot of times with these companies, if, if you look back on Tesla in 2011, very different from the company that we know today.

[B]

Yeah.

[A]

They had, they had the Roadster. They were not into robotics, they were not into artificial intelligence. Axon In 2015, that was a Taser. It was not even called Axon. It was called Taser International.

[B]

Yeah.

[A]

And that was their biggest business. They were kind of getting into body cameras. But they were not a cloud business. They were not a services business, a subscription business that they are today. You know, even a stock like Netflix, which is well known in the Motley fool universe, when that stock was first recommended, they were mailing DVDs all over the place. It was not a streaming company. So there's something too, too about buying a culture. Buying a lot of these are founder stories and sort of understanding that there is uncertainty. And that's the point and that's the upside that you don't get that upside by, by having all the answers.

[B]

I like that.

[A]

If I know the next story, the next product that's coming, then it's already priced in. There just seems to be something to that that you are investing in the unknown. If you're going to hold Nvidia, you know, for 20 years, you. That wasn't bought because it was an AI story.

[C]

Not at all.

[B]

No. I think that's it. We as investors always have to recognize there's so much that we don't know. And that is a superpower, if you can embrace it. I mean, Another example, Amazon 2010, we weren't talking about that as a cloud services company. Right. We were talking about it as this massively unprofitable e commerce business that was just on borrowed time because it wasn't making any money at the time. But you said it. Buying into a culture. I think if you can find those companies buying into a culture of innovation, it can be very powerful.

[A]

And then the other thing I think I always go back to is just not selling. Because if you own one of these great companies, you could have made the case. I have made the case that Tesla's been overvalued for years. You know, I made the case. I'm sure you could go back to 2010, 2011, making the case that Amazon was overvalued. I do have that analytical mindset and engineering background that I think you were talking about, you know, both Jason and Lou, where the numbers, there's, there should be in the numbers. But I think, you know what, what David talks about so much is the story. Right. He has, he doesn't have an engineering background. He's a English background because the that is ultimately what we're all investing in. I think Morgan Housel has written about this too. You know, the stock price is is the earnings today times a story about the future. And sometimes that story is a lot bigger than we really give it credit for.

[B]

Absolutely.

[A]

Well, when we get back, we're going to get back to stocks. We are going to talk about the latest from Google and Alphabet, maybe some big changes, changes in their AI business. You're listening to Motley Fulman.

[E]

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[A]

Welcome back to Motley Fool Money. As always, people on the program may have interest in the stocks they talk about. In the Minecraft. Motley fool may have formal recommendations for or against so don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley fool editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. The big story from the week in the world of artificial intelligence. Last week we had this huge Oracle deal with OpenAI, but Google is really starting to flex their AI muscles in the big partnership. Kind of early in the week we've got to talk about Chrome a little bit, But Google and PayPal announced a deal for Agentix Shopping. So Jason, what did we find out from those two companies?

[B]

Yeah, this is an interesting relationship. It's going to ultimately allow the two companies together. They're going to work on agentic commerce experiences. They're going to be embedding PayPal solutions across Google's platforms. Expanded payment processing. This is something that PayPal enterprise payments will be a key provider to processing card payments across Google products like cloud ads and Play and then ultimately working with Google on cloud expansions. I think all of that together, I mean, this certainly isn't bad news. I mean, it could indeed have a material impact on the dollars flowing through PayPal's networks as well as maybe boosting its user base in the process. And those are very good things. I wouldn't make the immediate leap that this is game changer for either company to the extent that we just don't know how it's all going to shake out. And I'm particularly not so sold on the agentic commerce opportunity.

[A]

Well, that's what I was going to ask about is what is agentic commerce? Because as I look through these announcements, it sounds great, right? The thing that I always keep going back to is could this just do my grocery shopping? Can I take a picture of my fridge and say I need to make dinner tonight. What do I need to get from the grocery store? And can you just get it shipped through doordash or whatever? Like, is that sort of the best use case? And then we'll figure it out. Maybe there's like, you know, a couple of use cases like that. There's another one that I saw that was, hey, I'm looking for this product. Can you tell me when the price comes down a little bit? Because maybe not worth paying $50, but maybe I pay $40 for it. You know, it just seems like we're, we're in a world of great headline, but we don't quite know what the there is there.

[B]

Yeah, it's kind of defined. It's like defining what salesforce does. Right. We know it's a big business, but what in the world does it do? I mean, in its simplest terms, right, Agentic commerce is a new form of commerce where autonomous AI agents act on behalf of consumers to search for, purchase, and receive goods and services. So it sounds like a big deal when you look at it from that perspective. I mean, I do think there are a lot of challenges there. Right? I mean, the process of agentic commerce on its own, there are a lot of things that have to go right for it to actually be successful. And that starts at the very beginning with customer or consumer adoption. So that's going to be challenging, I think, on its own. And then when you kind of look back historically, I mean, the E commerce hype cycles are just notoriously overhyped metaverse commerce. I mean, what happened to that, Travis? Live streaming commerce, voice commerce. Right? Even the Internet of things commerce. You're talking about your fridge ordering stuff for you. So it sounds great. A little bit more difficult to actually execute. I'm not saying it won't be a thing. And I do believe AI is going to offer opportunities for merchants and consumers alike in the retail space. I think it's just this agentic commerce experience that's still a little squishy and firmly unproven to this point.

[A]

Yeah, Lou, I, I want to sort of bring in that maybe the better use case here is these massive supply chain operations. I mean, you think about like a Chipotle, for example. Somebody's got to order the beef, Somebody's got to order the tortillas. If I can sort of figure that out and do it automatically, that would be a huge value add. That's not really what we're seeing in this. But, you know, we're trying, we're. We're also trying to squint and see where this is going, but that's it.

[C]

Exactly. It makes so much more sense for a corporation than it does for it. Because, Travis, even you say the, the reorder your groceries. I don't know about you, but I don't want to eat the same thing every day. So I don't necessarily, you know, and I like, I like being a human being getting to figure that out. I don't think it's that practical. I think for. On the. For consumer, just stalk the price and tell me when it's lower. I don't know if that's great for retailers, but I see it there. But I don't want a robot Deciding what jeans I wear or something like that. So I, I don't get it on the institutional side that. Yeah, that the, that McDonald's knows that they have 37 ingredients and when this ingredient gets down to this level, it's time to get more stuff like that. Yeah. I don't know how complicated that is. I don't know how much of a game changer it is. It makes sense to automate it. A lot of this, I think, was like Jason said, there's definitely something there. It's neat. But I'm going to take the under on it being on whatever revolutionary scale as far as hype is right now.

[A]

Not buying Meta display glasses, not buying stuff with agents, just a grumpy old man. I want to bring Chrome into this because, you know, OpenAI and ChatGPT are the biggest names in artificial intelligence. But the other announcement that Google had this week is that they're including more of their AI products, Gemini more deeply in Chrome. And at the end of the day, Chrome is the biggest browser in the world, has far more users than ChatGPT does. It seems like Jason that they're really leaning into this point of distribution. You had Chrome, you've also got Android. That could be the way that Alphabet, Google kind of takes a lead in the AI race, which the market seems to. To be buying into a little bit more now.

[B]

I agree. I think we're starting to see the sentiment shift on Alphabet and Google's position in the AI arms race. I think that makes a lot of sense. It ties back to what you were talking about earlier in regard to Meta. Right. And Alphabet having this advantage. Google having this advantage with all of these different platforms and ways to distribute this technology basically at the snap of a finger. And so then it becomes, all right, it's about changing consumer behavior, which as we know, it's. It's obviously doable, but it's difficult to do. And a lot of us are just used to using our browser, whether it's the app on the phone or the browser on your laptop or however you may do it. And if Google can just roll out all of these features and all of this technology that makes that experience better and more seamless. I just.

[A]

And by the way, for free. We also need to bring that up is that ChatGPT runs on subscriptions. Google has an ad business.

[B]

I think that's one of the big challenges with AI from that ChatGPT perspective is how are they going to monetize it. Right now, it's firmly the subscription side. They're going to have to figure out a way to evolve and iterate on that.

[A]

We do need to get to stocks on our radar, which is what we like to end with here on the show. Lou, you're going to be up and we'll bring Dan Boyd in to ask you a question about what is your stock on your radar this week?

[C]

All right, Dan, I'm looking at FedEx. Okay. The entire transportation sector has been beaten down. First due to slowdown fears last year and now tariffs. That has been a big deal this year. This is a notoriously cyclical business. And the question has become when do we get the bounce back? FedEx did earnings this week. They weren't really well, but expectations were really, really low. They beat them, but there's at least green shoots they beat. And they are actually forecasting modest growth, which is a lot better than even UPS said just a few months ago. Dan, this is a market where it's hard to love it long term, but with the transports, it pays to get in ahead of them. Sounding the all clear. I'm not ready to call a bottom, but FedEx has gotten my attention. I think we be nearing time where this works again.

[A]

Dan, are you a FedEx guy?

[G]

I mean, I am. Is in so much that sometimes FedEx delivers things to my house. I don't think I have a preference as to which carrier I.

[A]

You don't. You don't visit the FedEx Kinkos near you?

[G]

No, I don't. Yeah, FedEx. Hey Lou, you ever notice the arrow in the FedEx logo?

[C]

Yeah, it's kind of. It's a great logo, isn't it?

[G]

It's beautiful.

[A]

Jason, what's on your radar this week?

[B]

We talked a lot of tech today. So let's go to one of those boring businesses. I'm talking about Costco here. Ticker C O S T. Costco earnings are out next Thursday. And I mean, wow, talk about boring. But bring in the business. Shares are up 180% over the last five years alone, outpacing the market nicely. We know there's tremendous value in the private Kirkland's brand. Last quarter they ended the quarter with 79.6 million paid household members and 142.8 million cardholders. And you know, this has always been a renewal story, right? And renewals just continue to impress. And when we saw renewals at this past quarter, US and Canada renewal rate was 92.7%. Worldwide rate came in at 90.2. So 92.7 and 90.2. That is just consistent. It's amazing. It tells you why this is such a good business. And, you know, I can't believe it. But, Dan, I'm not even a Costco member.

[A]

Dan, what are your thoughts on Costco?

[G]

I'm not a Costco member either, Jason. There isn't one close to me, close enough to me to warrant going to Costco. Which is strange because I live in a pretty big area here. But, yeah, Costco. Did you get any gold bars, by any chance, when they were selling those things?

[B]

No, no, no, I didn't. But that's just. Just goes to show you, they have a tremendous and diverse supply for all consumers.

[A]

The biggest problem with Costco is they're so busy, it's hard to get parking around town.

[B]

It's like an airport.

[A]

But, Dan, which one of these stocks is going on your watch?

[G]

The logo carries it. Let's go, FedEx.

[C]

There you go.

[A]

All right. Lou wins this one. For Lou Whiteman, Jason Moser, Dan Boyd behind the glass, and the entire Motley fool team. I'm Travis Hoyam. Thanks for listening to Motley Fool Money.

[C]

We'll see you here tomorrow, Sam.