The Pet Cause Edition

Summary

Slate Money — The Pet Cause Edition (April 22, 2017)

Episode Overview

This “Pet Cause” edition of Slate Money, hosted by Felix Salmon and joined by co-hosts Anna Shymansky and Jordan Weissman, is a whirlwind weekly deep-dive into the top news from business and finance. In this episode, the team explores:

• The wild drama of activist hedge funds, focusing on Paul Singer’s Elliott Management and its campaign at Arconic.
• The merits and implications of Portland divesting from all corporate securities.
• The so-called “retail apocalypse” and the much-hyped $3.35 billion Chewy.com acquisition.
• A “numbers round” filled with striking statistics and quirky business stories.

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Key Discussion Points and Insights

1. Activist Hedge Funds & Arconic Drama (00:31–16:30)

Paul Singer vs. Klaus Kleinfeld

• The team begins with the saga of Paul Singer, the famed activist investor, and his battle with Klaus Kleinfeld, CEO of Arconic.
• The narrative gets juicy with the disclosure of an outlandish letter sent by Kleinfeld to Singer, referencing a wild party at the 2006 Berlin World Cup—with singing in a fountain and Native American headdresses.

“My favorite person in the world, Paul Singer, who’s completely insane…The guy who famously extracted billions of dollars from Argentina in a decade-long court fight.” — Felix Salmon (01:10)

Activism Tactics and the Bizarre Letter

• The panel reads excerpts of Kleinfeld’s strange letter:

  "It was much to my delight when I recently learned from Berlin what a phenomenal soccer enthusiast you must be..."
  — Anna Shymansky, quoting Kleinfeld’s letter (05:39)

• Discussion on whether this was a threat to “reveal kompromat,” with the group lampooning the ineffectual attempt at intimidation.

The Effectiveness of Activist Hedge Funds

• Deep dive into why hedge fund activists like Singer are more successful than pension funds—it's about concentrated portfolios, more resources, and different client expectations.

“Most strategies have much more concentrated portfolios…which means you have the time and resources to devote to individual investments.”
— Jordan Weissman (09:20)

• Anna and Felix note the negative public perception:

  “The PR problem…you’ve got guys like Carl Icahn who are famous for just demanding money.”
  — Anna Shymansky (11:31)

Are Activist Hedge Funds Good or Bad?

• Debate over the “duration mismatch”: activists often seek short-term gains, potentially leaving “smoldering wrecks.”

  “The idea that you can waltz in, dividend yourself out a huge profit, leave a smoldering wreck behind…you can see why that leaves a bad taste in people.”
  — Felix Salmon (12:10)

• Jordan counters that evidence shows many targeted companies actually perform better after five years.
• The conversation turns philosophical: Are they doing the dirty work of holding management accountable? What about the ethical costs?

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2. Ethics, Divestment, and Portland’s Investment Fund (16:31–28:41)

Portland’s Radical Move

• Discussion shifts to Portland’s $1.7 billion fund and the city’s decision to divest from all corporate securities due to mounting demands for ethical exclusions.
• Felix outlines the paradox: every time the city banned a new company, management said, “This is unwieldy,” leading to their dramatic solution—no more stocks or corporate bonds at all.

“They came up with the most glorious solution to this problem...they said, okay, let's just not invest in any corporate securities whatsoever.”
— Felix Salmon (18:06)

A Fiduciary Duty Debate

• Jordan argues this is a “clear violation of fiduciary duty” (18:40).
• Felix pushes back: fiduciary duty isn’t just about maximizing returns; it's also about matching the client's ethics.

What Now? The Risks and Rewards

• Anna notes the portfolio will likely lose return; Felix suggests alternative investments (impact, local projects) might make up the yield and offer new “double bottom line” potential.
• Anna and Jordan voice skepticism about the risks and practicalities of such impact investing.
• The segment closes with mutual skepticism but appreciation for Portland’s boldness—and the inherent tension in aligning municipal investments with local values.

“How do you measure [your duty] without something like a vote or something formal?”
— Anna Shymansky (25:13)

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3. The "Retail Apocalypse" and Chewy.com’s Mega-Deal (28:41–41:50)

Is Retail Dying or Evolving?

• The hosts dissect headlines about collapsing department stores (Macy’s, Sears) and widespread job losses.
• Anna clarifies that only a particular sector—department stores—is imploding, while broader retail is more resilient.

“You do have one sector of retail that is being kind of eaten alive by online merchandising... that is something to take note of, but…whether or not that has profound consequences for the economy isn't totally [clear].”
— Anna Shymansky (30:47)

• Felix spotlights how the retail crisis is largely invisible compared to coal mining, even as losses dwarf those in coal.

Chewy.com, the $3.35 Billion Sock Puppet?

• The retail debate segues to Petsmart’s $3.35 billion purchase of Chewy.com, evoking flashbacks to the infamous dot-com bust and the meme-ified pets.com failure.

“Somehow pets.com was a really stupid idea which deserved to go to zero and did go to zero. And chewy.com is worth three and a half billion dollars.”
— Felix Salmon (35:21)

• Anna cites Marc Andreessen’s theory that many doomed dot-com ideas were "just before their time." Is Chewy.com next-level genius, or a bubble-blown repeat?
• Jordan points out Chewy.com’s expensive, loss-leading business model; skepticism runs high.

"I would argue I don't see how this growth possibly continues. This is a company that doesn't make any profits..."
— Jordan Weissman (37:41)

What Does This Say About Tech Bubbles?

• Felix reveals pets.com’s peak market cap (00:39:12):

  “The answer is the maximum ever market cap for pets.com was $300 million. It was less than a tenth of what chewy.com is [sold for].”

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4. Numbers Round & Memorable Moments (41:50–49:17)

37% — Social Media Use in Germany

• Felix: Only 37% of Germans use social media, compared to 69% of Americans. (41:50)

  “Germans. 37% of Germans actually use social media at all.”

3.8% — Turkey's Current Account Deficit

• Jordan: Turkey’s current account deficit represents its reliance on foreign capital, which may hold authoritarian impulses in check (42:12).

2 Million — Venezuelan Protesters

• Felix: Two million Venezuelans protest against Maduro, drawing parallels to global political unrest (44:02).

$400 — The Juicero Juicer Flop

• Anna: Juicero, a $400 (once $700) cold-pressed juice machine venture-backed for $100M, is lampooned after Bloomberg discovers you can squeeze the juice packs by hand. (45:29)

“Bloomberg had a fantastic article where they discovered that you could just take one of Juicero’s juice bags and using your bare hands, squeeze it and get basically the exact same result as the $400 machine.”
— Anna Shymansky (46:33)

$190 — The Most Expensive Dog Food?

• Jordan mentions Chewy.com sells an eight-pound bag of New Zealand lamb dog food for $190. (48:33)

“One of their products that they sell is a $190 bag of dog food…an eight pound bag of New Zealand lamb.”
— Jordan Weissman (48:33)

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Notable Quotes & Memorable Moments

• On Activist Letters:
  “In your mind, imagine Hans Gruber from Die Hard...when Alexander saw the breadth of his domain, he wept for there were no more worlds to conquer.”
  — Felix Salmon (05:26)

• On ‘Retail Apocalypse’:
  “I like this idea of velocity of employment, that coal mining was a low velocity industry…retail was a high velocity industry...”
  — Felix Salmon (33:00)

• On Chewy.com’s Price Tag:
  “Pets.com was the ultimate dot com bubble bad idea…chewy.com is worth three and a half billion dollars.”
  — Felix Salmon (35:21)

• On Juicero Ridicule:
  “I have literally put up a…post on Instagram that said if anyone ever sees me buying $10 juice, they are entitled to shoot me with a dart gun and drag me out of the store.”
  — Anna Shymansky (47:51)

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Timestamps for Key Segments

• Arconic & Paul Singer drama: 00:31–16:30
• Activist fund analysis: 08:14–16:30
• Portland divestment ethics: 16:31–28:41
• Retail apocalypse & Chewy.com: 28:41–41:50
• Numbers round (miscellaneous business curiosities): 41:50–end

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Tone and Style

The conversation is irreverent, witty, and deeply informed, blending sharp financial analysis with cultural critique and plenty of asides. The hosts play off each other’s insights with banter, skepticism, and the occasional digression into “singing grannies” and juice tech absurdity — all while striving to clarify complex business news for a general audience.

Transcript

[Anna Shymansky]

The following podcast contains explicit language.

[Felix Salmon]

Hello and welcome to the Pet Cause edition of Slate Money, your guide to the business and finance news of the week. I'm Felix Salmon of Fusion. I'm joined here by Slate moneybox columnist Jordan Weissman.

[Anna Shymansky]

Hello.

[Felix Salmon]

By woman about town, Anna Shymansky.

[Jordan Weissman]

Hello.

[Felix Salmon]

Who sadly is not going to talk about anything emerging market. Well, numbers around. There will probably be something emerging markets in here, but we will. Yeah, we will talk about more wonderful things this week. We're going to be talking about. This is great. I don't know if you've heard about this, but the city of Portland has decided to divest from all corporate securities. We're going to talk about what that means because it's kind of awesome. I love it. We're going to talk about. About the second coming of pets.com?

[Jordan Weissman]

No sock puppets.

[Felix Salmon]

And there were fewer sock puppets but like more money.

[Anna Shymansky]

A lot more money.

[Jordan Weissman]

Yes.

[Felix Salmon]

And what this means about the in terms of the retail apocalypse. Have you heard about the retail apocalypse? There have been big articles about the retail apocalypse all over Bloomberg and elsewhere. So we're going to talk about the retail apocalypse. But first, Anna, this is the story which we had like requests coming in over Transom. Can you talk about this? My favorite person in the world, Paul Singer, who's completely insane, who's a good friend of ours. Yeah, I guess we have to talk about emerging markets, don't we?

[Jordan Weissman]

Right? You can't say Paul Singer and not say Argentina.

[Felix Salmon]

You can't say Paul Singer without mentioning Argentina. This is the guy who famously, you know, basically extracted billions of dollars in money from Argentina in a decade long court fight. But he doesn't just fight countries. No, it turns out he also fights this company which used to be called Alcoa and is now called.

[Jordan Weissman]

Well, this is actually a segment of the company that has been spun off. The aluminum parts manufacturing for aerospace and automobiles. The kind of higher margin, higher growth segment.

[Felix Salmon]

So Alcoa used to just make aluminium and now it's two companies, one which makes aluminium and which makes things out of Alameda.

[Jordan Weissman]

Exactly. Which is run by Klaus Kleinfeld or.

[Felix Salmon]

Was run by Klaus Kleinfeld. This is the guy who got fired from Siemens for under some kind of a bribery issues and has now been fired from Archonic as it's known.

[Anna Shymansky]

Wait, wait, is he the. Wait, is that back when Siemens was literally like stuffing cash in drawers for people to go and bribe third world like bureaucrats?

[Felix Salmon]

Well, it's a large German company. What can we say?

[Anna Shymansky]

Yeah. Oh, I didn't realize he was part of that whole Michigan. Okay. Anyway, sorry, I could take some of this.

[Felix Salmon]

So he. So Alcoa is a great American company which used to be run by our former finance minister, Paul o', Neill, but it was run by a German because we were all good globalists around these parts. And it was run by this German who was very good at making things, because Germans are great at making things. And sadly for Klaus, while he was presumably quite good at making things, he was quite bad at making the stock price go up.

[Jordan Weissman]

Yes. Apparently he was spending too much time at Davos, too much time with Trump, not enough time meeting profit targets or dealing with competition from the Chinese aluminum industry. So. But most importantly, he recently sent a pretty fantastic letter and an Adidas soccer ball to Paul Singer.

[Felix Salmon]

And. Okay, so, all right, we need to back up a little bit here. Paul Singer runs an activist hedge fund called Elliot Management.

[Jordan Weissman]

Yes. They do other things as well.

[Felix Salmon]

And one of his activist stakes was in Arconic.

[Jordan Weissman]

Exactly.

[Felix Salmon]

He was looking at Klaus and saying, klaus, you're spending too much time in Davos and paddling around with Donald Trump and not enough time, you know, making the company's share price go up. So we want you fired. We want the board replaced. We want to come in here and shake things up.

[Jordan Weissman]

Right. And the board and the company had been, up until very recently, supporting Linefeld. But then this past week, this letter emerged where. It's a very, very bizarre situation. But the letter suggests that Singer was engaging in some, I quote, lastingly legendary partying in 2006 at the Berlin World cup involving singing. Singing in the rain in a fountain, and a Native American headdress is somehow involved.

[Anna Shymansky]

I have the letter up if. Do we want to, like, read a little bit directly onto his flavor. It's kind of. It's almost like he's talking about, like this. Apparently, Paul Singer showed up at the World cup and just went hog wild. Or that's what it's suggesting. And there's something that he's almost. Klaus is going to reveal some compromise, right.

[Jordan Weissman]

Innuendo, that, yes, he will, like, release this information to the public. It's suggested.

[Felix Salmon]

Okay, so, Jordan, like, let's have a little excerpt of this letter. And I am going to preface this by saying I have met Paul Singer. He is very boring.

[Anna Shymansky]

And yet this letter makes him sound like just fucking life of the party. But anyway, I'm not going to do a German voice. I thought about doing a German voice, but anyway.

[Felix Salmon]

But you. In your. In your mind, imagine, like, Hans Gruber From Die Hard. Yeah. When Alexander saw the breadth of his domain, he wept, for there were no more worlds to conquer.

[Anna Shymansky]

Anyway, it was much to my delight when I recently learned from Berlin what a phenomenal soccer enthusiast. You must be Quite a few people who accompanied you in Berlin in 2006 during and especially after the many matches you attended are still full of colorful memories about this obviously remarkable time. It indeed seems to have the strong potential to become lastingly legendary. Like, imagine like tinted fingers.

[Felix Salmon]

And the book goes on in this vein and there's some vague, like, mention of an Indian headdress. It's kind of insane.

[Jordan Weissman]

It's ridiculous.

[Anna Shymansky]

Yeah. The P.S. if I manage to find a Native American Indian's feather headdress, I will send this additional assignment. Essential part of the memories. And by the way, Singing in the Rain is indeed a wonderful classic, even though I have never tried to sing it in a fountain. Sorry, it's so. It's so weird.

[Jordan Weissman]

It's so weird also because, like, Singer is the head of a $32 billion fund. He is not involved in most of the day to day investments. So it doesn't even make any sense why the letter was sent to Singer. Like, that's the whole thing makes no sense.

[Anna Shymansky]

Unless he was like, is he drunk?

[Jordan Weissman]

Like, it makes.

[Anna Shymansky]

Unless it was like, literally, like, he was like, doing hookers after these matches. And that's like, what he's hinting at. But like, what could. Like singing a fountain. That's only going to make him. People like him more.

[Jordan Weissman]

Exactly.

[Felix Salmon]

And Paul Singer receives this letter with glee, immediately turns around to the board of Iconic and says, do you realize what your CEO is doing in a period of drunken craziness? And the board says, we totally support our CEO's strategy and our plan, and we don't really believe in anything that you say. But yeah, you're right, this letter was a bit too much. And they fire him.

[Jordan Weissman]

Yes. Suggesting that apparently they did have a point all along.

[Felix Salmon]

Well, because, like, Elliot's reaction to this has been fascinating. Elliot's reaction has been, yeah, okay, fine. You know, we got this guy fired because he was really stupid and wrote a stupid letter, but the board is still saying that his strategy was right and his strategy wasn't right. Have they achieved something?

[Jordan Weissman]

Well, again, so much of their attack on the company had been targeted to Kleinfeld. I mean, granted, it's part of a larger strategy, but he was the kind of embodied that strategy, so. And with a lot of activist hedge funds, they tend to focus on CEOs, so getting the CEO kicked out and then potentially getting Larry Lawson, who they want to have a CEO put in. We still don't know if that's going to happen, but that could potentially allow them to put forward their entire strategy and get that share price up in theory.

[Anna Shymansky]

So this actually kind of, there's sort of a bigger question this story kind of brings up and I want to ask you guys about, which is why guys like Paul Singer seem to be so damn effective at what they do. Because this is, you know, in the end he got rid of the CEO, he succeeded. And then if you look at the econ research, right, the kind of finance econ research, what they found over and over again is that, you know, there are multiple kinds of activist investors. You have like pen pension funds, right, who often own like a big share of a company and, or, you know, together. A few pension funds own big shares of a company and they'll get together and try to do something where they pressure the board to make changes in the way it's managed. And then you have these guys like Singer who are hedge funds who take up a, you know, a large share and like, you know, you know, aluminium maker or some such thing, and they try to pressure changes at the corporation. And what they find, when researchers look at this, they find over and over again is the hedge funders are just better at it and they are just, they are more skilled at getting higher returns than compared to other people who try to go in and somehow pressure companies. So why is it that the hedge funders are so damn good at this? Why? Why are they better than the rest?

[Jordan Weissman]

So if you're looking at a hedge fund, alternative investments in general, most strategies have much more concentrated portfolios. So you don't have as many investments, which means you have the time and resources to devote to individual investments as opposed to real money guys, your pension funds, your endowments, your mutual funds who have hundreds and hundreds of investments. So even if they have some bigger positions, at the end of the day, they do not have the time and resources to devote in this type of action. Also, they have a different client base. Yeah. Or the resources.

[Felix Salmon]

So, and I think this, it really does come down to money. You know, if you look at how much money Paul Singer spent fighting Argentina, it was hundreds of millions of dollars. And any mutual fund who spent hundreds of millions of dollars on lawyers fighting one of its, you know, own positions would, you know, there's just no way that you could get that through compliance.

[Jordan Weissman]

No, it's also, it's a different client base if you're looking at who's investing in alternative investments, and granted you do now have a lot of institutional investors like endowments, pension funds investing in alternative investments. But in general, the clients that are investing in a place like Elliot understand that they're going to be engaging in this type of action, whereas individual investors investing in a mutual fund or just an endowment themselves, it's, it's a completely different client base that doesn't have the tolerance for this type of activity long term.

[Felix Salmon]

And, and also I your comparison, you know, you can say that pension funds are activists, but really, are they activists? No, they're not really activists. They might come out and have a quiet, you know, word in the CEO's ear saying I think you should have more women on the board or something. But in terms of like wanting, they don't generally go in with the expectation of getting money by making change if they, they buy stock in companies they like, not in companies they don't like and want to like.

[Anna Shymansky]

Right.

[Jordan Weissman]

They tend to be passive. Which I also then think raises another question of why we have such negative connotations of activist hedge funds. Like if these funds are essentially the only people holding corporations and management accountable, why do they still continue to have such negative reputations? Aren't they doing what we want them to do?

[Anna Shymansky]

Well, I think I can answer that. Just like the, you know, the PR problem they have, which is that you've got guys like Carl Icahn who are famous for just demanding money, right? They demand payouts when the company has too much cash lying around. And some people, there actually is something to be said for that. Sometimes the money is just sort of sitting there and not doing anything. But I think that people see that and they think, well, couldn't that cash be spent better on investing or in research? And at the same time, there is evidence that companies that get targeted by activist hedge funds do tend to cut things like R and D spending. The question is actually whether or not that is really hurting them sometimes that R and D spending wasn't really helping them either.

[Felix Salmon]

So I mean, for me, the problem with activist hedge funds is really what you might call a duration mismatch that I think of someone like Dan Loeb and what he'll do is he'll take a big stake in Yahoo, he'll throw out the CEO, he'll replace the him with someone else, and he'll persuade the new CEO to do, you know, to basically, you know, say that she'll spin off the Alibaba stake and there's all manner of, you know, financial engineering going on. And then he gets what he wants, the share price goes up and he sells his shares and he leaves. At which point Yahoo is basically a basket case. He doesn't care. He's not a shareholder anymore. And the idea that you can waltz in, dividend yourself out a huge profit, leave a smoldering wreck behind you and go on, rinse and repeat is. You can see why that leaves a bad taste in people, right?

[Jordan Weissman]

But are they leaving smoldering racks behind them?

[Felix Salmon]

Because have you seen Yahoo?

[Jordan Weissman]

Right. I realized Yahoo is one bad example. But if you look overall at companies that have been targeted by activist funds, usually five years out, they have better performance.

[Felix Salmon]

So one of the interesting things that also came out this week was an article in the Atlantic by Frank Partnoy and Stephen Davidoff. And they were like, hey, why don't we try and be activists? Just the two of us, law professors. And I like them both. They're good guys. And they found this tiny little company in Southern California which owns a bunch of land. And they reckoned that the value, that the market capitalization of the company was much lower than the value of the land. And so there was an arbitrage there. And they had right ideas of what the company could do to improve, improve its share price. And they tried to activist and, you know, spoiler alert, they failed. But like, it's a great article, it's a fun read. And I think again, what you saw there was a duration mismatch, that what they wanted was a short little bump in the share price on the grounds of like, you know, the share price representing the value of the land. Whereas the people who are owning that stock are basically owning it as a proxy for owning the land. And they know that at some point some gazillionaire is going to come along and buy the company in order to buy the land for some vast amount of money. And they're not going to try and rush it, and they're happy to sit there and twiddle their thumbs until it happens. And it's a question of do you have patience or do you not have patience?

[Anna Shymansky]

Well, I was going to say their point at the end of that article is that this company was not just kind of lazy and not really moving quickly, but it just wasn't very transparent. And it wasn't, you know, it wasn't, it wasn't sharing information with shareholders. And their conclusion is that more of these small companies could use impatient, you know, activist investors. And they're never going to be but they're never going to be targeted because those aren't the sort of corporations that attract attention from people like Paul Singer for the most part.

[Felix Salmon]

Well, I mean like Herbert Life was. And that wasn't huge.

[Anna Shymansky]

That's true.

[Jordan Weissman]

But that's still a bigger company than like think Tayan Ranch. I mean I. But going back to what you were saying in terms of this duration mismatch, I mean, I think though that's suggesting that there is no connection between increasing short term efficiencies and long term profitability. As though I do understand that often when you're thinking about hedge funds or if you're thinking about like private equity firms, which is a different issue of coming in and actually buying out that, oh, they're just completely destroying long term value. But there. And sometimes that can be the case, but sometimes that's not the case. And sometimes it can be the case that in fact these companies are being poorly run, they are paying their CEOs too much, they aren't using cash efficiently. And these companies, these funds can potentially come in and force them to engage in changes that can affect long term share value and also frankly help your real money investors like your pension funds and your mutual funds that don't have the ability to do this, but they.

[Felix Salmon]

Also, they, they get to be free riders.

[Jordan Weissman]

Exactly.

[Felix Salmon]

Yeah. So I want to continue here on this question of activism because there are various different types of activists. There are the hedge funds, as we have talked about. There are the pension funds who are relative, who are better at free riding than they are at actually making change. And then there are our favorite like.

[Jordan Weissman]

You know, singing grannies.

[Felix Salmon]

I was gonna say Park Slope food co op types, you know, having huge fights about whether you can sell hummus and the spiritual center.

[Jordan Weissman]

Why could you not sell?

[Anna Shymansky]

No, this was actually. Have you never heard of it? The great. It was over Sabra. Right. Is about, you know, Israeli settlement thing anyway. And don't, don't go on so.

[Felix Salmon]

Well. Yes, well, this is part of it. There's this thing called the BDS movement, which is a big thing where you can't invest in Israel as long as it's, you know, settling Palestine. There's a bunch of other companies which are considered to be beyond the pale, including obviously tobacco companies, firearms companies, energy companies. The list goes on. Caterpillar was on the list for reasons I can't remember. I'm sure we're all boycotting United Airlines right now. And on and on and on. And the spiritual home of this kind of like it's Unethical to invest in everyone from ExxonMobil to United Airlines is, of course, Portland, Oregon. And Portland, Oregon has a $1.7 billion investment fund to pay its pensions and whatnot. And the good burgers of Portland, Oregon turned up one day and said, here's our list this week of the companies you can't invest in. And the investment management team in Portland, Oregon said, listen, every time we come back here, you give us a new list of companies we can't invest in. This is becoming unwieldy and unmanageable. And we were okay up until now, but we can't go on like this. And they came up with the most glorious solution to this problem that I've ever heard, which is they said, okay, let's just not invest in any corporate securities whatsoever. No stocks, no bonds from any corporation anywhere in the world.

[Jordan Weissman]

Yeah. I would just like to say that if I were a Portland taxpayer, I would be quite angry at the clear violation of fiduciary duty of the people running this fund.

[Felix Salmon]

And I am going to take the other side of this. And I'm saying that the fiduciary duty is not the same thing as maximizing returns. And that if your client, which is the city of Portland, wants you to invest a lot, you know, in accordance with certain ethical principles, then all power to you. You should do that.

[Anna Shymansky]

So I'm going to take a middle ground here and say, I don't know if I'm really for or against this, but I think it's going to lead to, like, some hilarious outcomes somehow. Like, so, I mean, on the one hand, they're definitely going to lose money. Like, they're. If you're not going. I mean, that is. You take that for granted.

[Felix Salmon]

Okay, I will push back on that.

[Anna Shymansky]

Okay, well, okay. Unless they go for. So they're not going to invest.

[Felix Salmon]

You should see the look that Anna just gave.

[Anna Shymansky]

So here's the thing. They're not going to invest in corporations. Corporations, typically, that's kind of a drag on your portfolio. However, this could lead to some crazy situations like, well, there's sovereign debt. So I almost imagine a situation here where, like, the investment fund of Portland is just going to be lending money to, like, the South African government in some chase for yield.

[Jordan Weissman]

Pretty sure it's domestic munis and federal.

[Felix Salmon]

Well, it's not munis, because the only reason you invest in munis is for tax purposes, which this is. Okay, so this is my insight here. Okay, this is. This is like. So Anna's 100% convinced that this is going to cost a significant amount of yield or return or whatever you want.

[Jordan Weissman]

To call it, because I can add.

[Felix Salmon]

Jordan is more or less convinced as well. So I'm going to try and take the other side of this one and say there's a, another way of looking at it. $1.7 billion is a lot of money. The corporate part of that $1.7 billion portfolio was about 30%, so it wasn't a huge amount to begin with. It's not like they're changing the entire thing. They're keeping 70% of what they had. And so the question is, if you have 30% of your portfolio in like risky stuff, interesting stuff, which is meant to be like boosting your returns, where do you invest it right now? Is overheated public equities the smartest place to invest it is hi sir, this is going, you know, is overheated bonds the smartest way to invest it? Or if you're coming at this from a more ethical point of view, maybe you could start doing some interesting things in say impact investing. Maybe you could start doing some interesting things in like real resources like low income housing or timber or sustainable energy or various other alternative assets which aren't necessarily just buying and selling stocks on the stock market. And if you do that, there's a good chance that if and when the Trump crash happens, you will look really smart.

[Anna Shymansky]

Wait, how do you do impact investing or alternative energy investing if you're not going to corporate?

[Jordan Weissman]

Because I mean, also I would argue that that impact investing tends to overweight small cap growth stocks, which are probably some of the most overvalued right now. So I think the argument that by moving your money out of corporate bonds, especially very low risk, currently low yielding corporate bonds, and putting them into small cap growth equities in a moment when the market is frothy and thinking that you're going to have better returns.

[Felix Salmon]

So impact investing in my mind never includes buying securitized equities on the secondary market. They're buying securitized equities on the secondary market, just is never going to have an impact on anything. Now you know, I will agree if there was a criticism here which I haven't heard, like, you know, divesting doesn't make any difference. Like it's true. Divesting doesn't make any difference.

[Anna Shymansky]

We're all taking that for granted.

[Felix Salmon]

But by the same token, investing in some like already issued equity, whether it's a small cap stock or anything else, also doesn't make any difference. So that's not impact investing. You're not going to have an impact by investing in a small cap growth.

[Anna Shymansky]

So you think venture, so you think venture capital here.

[Felix Salmon]

So, so yeah, I'm saying like you can buy equity overvalued, you can buy equity, but you're, what you're doing is you're, you're, you're structuring investments in certain companies directly into that company. It's always primary deals. So you could call it private equity if you wanted or you could call it structured finance or you could call it, there's a whole bunch of things which involve a combination of debt and equity and real assets and which are designed to have, you know, the term of art among these people is double bottom line investing.

[Jordan Weissman]

You could also call it quite risky investments. And I would argue, yes, and this.

[Felix Salmon]

Is 30% of your bucket which is allocated to risky investments, but it's not.

[Jordan Weissman]

Allocated to risky investments. If you looked at that portfolio, those were very low yielding, short duration investments.

[Felix Salmon]

And you can do this in debt instruments as well, which is, you know, I can give you a risk profile from alternative investing and impact investments and real assets which is almost identical to the risk profile you had in bonds and stock.

[Jordan Weissman]

I mean you're looking at bonds that were yielding not that much more than the Treasury.

[Felix Salmon]

Right.

[Jordan Weissman]

So you're not going to be getting, it wouldn't make any sense to go into alternative investments, vc, where you're taking on tremendous, more risk for that type.

[Felix Salmon]

Of return, friendship debt or you know, there's like I say real estate. Right.

[Jordan Weissman]

But the whole point is you're going to be expecting a much higher return because you're taking on significantly more risk. And my guess is I don't know what Portland exactly uses its money for if this is to just offset life like pension liabilities or if they have a longer term investment horizon so they have fewer liquidity needs, so then they could take on more risk. But I would imagine just looking at the structure of their portfolio, they have to, they cannot take on tremendous risk. So it wouldn't make any sense to me to go into alternative investment classes which are far more liquid, far riskier. That doesn't seem to make any sense to me. I don't disagree that ethically there could be an argument for it. But in terms of your fiduciary duty as an investment manager, that doesn't make a lot.

[Felix Salmon]

And I, and you know, as I say, I hate it when people like I just wrote about the Ford foundation going on about fiduciary duties. This idea that there's this mythical thing called fiduciary duty which prevents you from investing in, like, according to the ethics of your client, is complete bullshit.

[Anna Shymansky]

It's also a little tricky when you're trying to figure out what your duty is to the city. Like, right. Like right now they're. I mean, my guess is that the, you know, Raging Grannies who showed up to sing a protest song at this last meeting, and that's actually what they call themselves, the Raging Grannies.

[Felix Salmon]

From Standing Rock to Palestine. Here in Portland, Texas, human life is under attack, and the right thing must be done. Which side are you on? Because this is Portland.

[Anna Shymansky]

Because this is Portland. They were wearing funny hats because I don't know if any had a bird on it, but, like, you know, probably decently represent the views of their fellow Portlandians. However, I mean, how, you know, when you're making an ethical call as running an investment fund for a municipality, it is a little bit. It's tricky. What is your duty, period? I don't know how you measure that outside without something like a vote or something formal.

[Felix Salmon]

I think there was a vote. And I think that, you know, while getting some kind of combination of risk and return is certainly part of what an investment manager's job is, I think it is not true to say that that's the be all and end all. And then in any way you kind of deviate from your risk slash return mandate is a violation of your fiduciary duty. I think that's just not true at all.

[Jordan Weissman]

I mean, I think there is certainly a smarter way to. I mean, obviously there's a smarter way than what they did, but in terms of saying, okay, we want to meet a certain return target, because as a city, we have certain things, services, affordable housing that we'd like to pay for, so we need to earn a certain amount of money to pay for that. Okay, how can we earn that money? Well, maybe we can do some research into certain corporations or whatever that we could potentially earn that same amount of money, which is not at all what they did.

[Anna Shymansky]

Yeah, I think I. You. You kind of articulated. I was trying to get out much better. But, like, you know, you have a bunch of activists who are angry about corporations, but it's not clear if they understand that, okay, we may be sacrificing some returns and that might hurt our other priorities. We may be making a trade off elsewhere. And cities do have responsibilities for things like affordable housing and such. So the, you know, so it's hard to say, like, okay, is your fiduciary responsibility. There are things to weigh here. It's not just about appeasing a few activists who show up and get pissed off about you investing in a coal mining company or something.

[Felix Salmon]

And we will see. And I guess the big question, everyone is trading this as a trade off. Is it worth losing a certain amount of return in order to be ethically happier? And I think a lot of people in Portland would say, yes, it is. And they're making that trade off quite consciously. And then I'm just going to say, like as a provocation, that maybe it's not even a trade off at all and maybe they're not even going to give up.

[Anna Shymansky]

So just to recap, Anna wants them to drop what they're doing and just invest in companies. Felix, you want them to become a $300 million venture capital fund for alternative energy. And I want them to start lending money to Venezuela or something just for, just for the hell of it, to see if they can get high yield.

[Jordan Weissman]

That way or just essentially an oil.

[Anna Shymansky]

Company and prove their lefty bonafides by supporting socialism directly.

[Jordan Weissman]

The socialist oil company.

[Anna Shymansky]

Yeah, that's what we each do.

[Felix Salmon]

Or just lend the money, you know, to people building affordable housing in Portland, keep it local instead of throwing it to the New York Stock Exchange. Let's talk about the retail apocalypse. Which Jordan, you think doesn't exist?

[Anna Shymansky]

I mean, like, it depends which retailer you're talking about, what kind of retailers, you know.

[Felix Salmon]

So, I mean, I've been reading these articles about how the workers in shopping malls around the world, or at least around the United States, you know, the employment is down 20%, that it's mostly women, that no one knows or cares about these people because they're mostly women. And that the number of losses in retail, job losses in retail in recent years is like 20 times bigger than the number of job losses in coal mining. But you never hear about it. Is this true?

[Anna Shymansky]

So, I mean, there definitely is a sector of retail that's in trouble. Department stores are very, you know, are ailing. They're falling apart. Macy's is not doing well, and, you know, Sears is not doing well. And there definitely are retailers that, you know, I think there have been nine retail bankruptcies in 2017. I mean, this is not Neiman Marcus is for sale. Yeah, I mean, it's. They're troubled. But, you know, I think you have to separate the entire. You know, you'll see a lot of these articles that say, oh my God, retailing is falling apart. And 1 in 10American workers are in Retail. And you have to separate the department stores, which, you know, really are kind of falling apart. If you look at this, if you look at a sector called general merchandise stores that the government tracks, I think they've lost like 100,000 jobs in the last few months, which is quite a bit. You have to separate that out from the greater retail sector, which is seeing sort of like, which includes things like auto dealers and, you know, clothing stores, etc. And that is essentially seeing a small dip in jobs that is not really apocalyptic. So you do have one sector of retail that is being kind of eaten alive by online merchandising. Essentially it's being eaten by Amazon. And you know, that is something to take note of. But at the same time, you know, whether or not that really has profound consequences for the economy at this point isn't totally.

[Felix Salmon]

Well, I mean, let's put aside the economy. Let's just like stick to profound consequences for the people who work there. Like if you're, if you have a job in a department store, your employment is precarious. We have seen this movie before. Ask anyone who, who used to work in a bookstore 20 years ago. Like these jobs can go to zero.

[Jordan Weissman]

Right. But are those people just unemployed or are they going into another job? I guess that would, this would be my argument because even though we're seeing some of these numbers, it's not as though we're seeing tremendous. In fact, we're seeing decreases in unemployment. Granted, I realize that at this point we don't know this specific segment of workers, which jobs, whether or not they're able to shift into another job. But there is also an argument to be made that as some of these low paid, low skilled retail jobs are going away, there are other jobs, often unfortunately low paid, also low skilled, that these workers could shift into. And I don't.

[Felix Salmon]

Such as, such as.

[Jordan Weissman]

I mean, what we're seeing in a lot of malls where you're seeing a lot of the decline of some of your traditional retail stores, you're seeing the growth of hair salons, nail salons, fitness centers, entertainment centers, is kind of more the shift to like experiential retail. And essentially it's often the same skill set. So my question is, are we actually seeing an incredible increase in unemployment among these workers moving forward or are they just shifting? Exactly. I don't know. I haven't seen that data, but I think that's a, it's a question to raise.

[Anna Shymansky]

Yeah, and there's been this sort of political meme going around which is, you know, Donald Trump cares so much about coal miners. Right. And retail is so much bigger than coal mining. All these retailers jobs are disappearing. And why does, why don't Republicans care more about retail jobs? And you know, in the end, it's because retail typically isn't the main economic support for a, it's not the main economic support of a community. There is no, like Poughkeepsie is not, you know, balanced on retail. Like, there's no, there's no West Virginia of retail. But beyond that, also, I think these jobs, I mean, not, I think these jobs do tend to be more transient. People move in and out of them. That's one of the defining things about the retail workforce is that people shift from job to job. And so, so when one store closes, it might not have the same devastating effect on a career.

[Felix Salmon]

I like this idea of velocity of employment, that coal mining was a low velocity industry where people would stay there for decades and retail was a high velocity industry where people would normally, even in the boom years of department stores, not stay working for the same department store for that long. And that if you're going to be moving on from that job anyway, then the idea that the total number of jobs in that store or in that industry is going down is going to be less harmful.

[Anna Shymansky]

Right.

[Jordan Weissman]

And it's just culturally so different. I mean, you hear these stars when people talk. And granted, coal miners are a very small segment of the economy. There are more yoga instructors in America than there are coal miners. But coal mining represented something culturally to a lot of people, even though these weren't particularly fantastic jobs for many reasons. Black lung, least among them. But it did represent something, whereas that isn't. We don't, you don't have the same cultural associations of working at Sears. Whether you should or shouldn't, that's a larger question. But you don't.

[Felix Salmon]

Let's, let's move on to the news hook here because, because this is. I had a little poll on my Twitter feed this week. I said, has anyone here ever heard of chewy.com C-H-E-W-Y.com and 70% of the respondents to my highly scientific Twitter poll said, who? What? No, never heard of it. And I've been talking to other people, you know, around town and say, have you ever heard of Chewy.com? and pretty much that seems about right. 70% of it. People have never heard of it. And it's a retailer and it's a retailer that most people have never heard of. And yet it is being bought.

[Anna Shymansky]

Yeah. So Chewy reportedly, According to Ricodo, Petsmart purchased Chewy.com for $3.35 billion.

[Felix Salmon]

$3.35 billion. That's more than the. That's more than Jet.com sold for.

[Anna Shymansky]

Yes. If true, this would make it the largest E retail, e commerce purchase ever. And what you neglected to mention, Felix, is that Chewy sells pet supplies like dog food and things like that we.

[Felix Salmon]

All learned during the dot com crash in 2000. Well, at least those of us who were alive. I think Jordan was in diapers or something.

[Anna Shymansky]

My fifth grade class did have a stock picking. My fifth grade math class had a stock picking project. And I might have invested in pets.com.

[Felix Salmon]

For a while, but there was this, this generally accepted idea that like pets.com was the ultimate.com bubble bad idea. And like it made no sense to sell cat litter over the Internet because by the time you paid to ship it to people, it cost vastly more anyway. Somehow pets.com was a really stupid idea which deserved to go to zero and did go to zero. And chewy.com is worth three and a half billion dollars.

[Anna Shymansky]

So there are two ways to think about this. There's the Marc Andreessen point of view, right? Which is that he likes to argue that every idea that went bust in the early 2000s, every.com idea that we laugh at was actually a good idea that was just before its time. This would seem to be the ultimate indication thereof or the biggest vindication of his perspective. However, assuming that this $3.5 billion, you know, $3.35 billion price tag is true and some people have contested it and, you know, anonymously said, actually it's inac it. But let's, let's take for granted that it's true. You could just say is we're looking at a highly inflated market for, you know, for startups and with way too big valuations. And at the same time, you have this retail apocalypse happening. So you have companies like petsmart freaking the hell out and saying we have to pay top dollar just so that we don't get eaten by this competition.

[Jordan Weissman]

And I would actually argue that these are really connected too, because I would say that it's not necessarily the retail apocalypse as well as instead the retail shifting that you have a lot of traditional bricks and mortar stores that understand that they're going through a very expensive transition and it's, it makes more sense often to buy another company that's already doing something, well online as opposed to trying to start that in house. But in order to Generate the cash to buy that. You often have to close things like unprofitable stores, which is what we're seeing happening. So I think these ideas are very much connected. But I would also agree with you that I think that if it remains to be seen if this isn't going to be another cautionary tale down the line, if. Because the type of growth we've seen in Chewy.com is pretty remarkable. Granted, it's only been over five years and I would argue I don't see how this growth possibly continues. This is a company that doesn't make any profits, which I realize that's always the case with a lot of these tech companies. But this, I mean they, they have a lot of revenues, but they don't make any profits. And if you look at the type of food, pet food that they've been making money on, it's just very expensive. This is a, like a, I would say like a really like niche market that I don't. And it's primarily been New York and California. I don't know how you expect. Because also part of the reason that they've been able to grow is because they have great shipping and great customer service. Can you scale that?

[Felix Salmon]

Yeah, that's, that's the thing that the big difference between chewy.com and pets.com and the big difference in a lot of these businesses is that Pets.com was basically built on UPS and the USPS. Whereas Chewy.com and the sort of second and third generation retail startups are saying, no, we are going to invest huge amounts of money in distribution centers in Brooklyn and in Oakland and places like that so that we can get people stuff ourselves very quickly. But as you say, you know, that's great if you live in Brooklyn or San Francisco and it's not so great if you live in Boise. Yeah, but this is my favorite data point. I need to throw in the data point here. We look back on the dot com bubble as the time of like max crazy. And I think in many ways it was certainly, if you look at the NASDAQ Stock Market. But my little quiz for YouTube is at the very, very height of the dot com bubble, when Pets.com was trading at its maximum amount. What was the market cap of pets.com?

[Anna Shymansky]

Okay, so I know the stock went up to like 15. It disappointed from the outright because pets.com debuted and immediately started falling because already people knew it was in trouble. But like, I don't know, I'm gonna get like, let's give it I was pretty young. Yeah, I was like two years out of that fifth grade. Stock picking class or project. Let's give it. Let's say I. Let's say it went to 900 million. Let's say sub a billion.

[Felix Salmon]

So you think it was less than chewy.com but sort of within the same neighborhood?

[Anna Shymansky]

Yeah, Anna?

[Jordan Weissman]

I would say, yeah, maybe around. Around a billion.

[Felix Salmon]

Around a billion. The answer is the maximum ever market cap for pets.com was 300 million. It was less than a tenth of what chewy.com is.

[Anna Shymansky]

What is that adjusted for inflation? Still not. It's not. Well, it's still not going to get that much.

[Jordan Weissman]

Yeah.

[Felix Salmon]

Which just like, you know, goes to show how everyone says that the private markets are the new public markets, but just that really brings it home that we're not even talking the amount of money that Pets.com raised in the stock market. We're talking about the entire market cap is less than many capital raises that you're seeing these days from the big private companies.

[Jordan Weissman]

Yeah.

[Felix Salmon]

Okay, let's have a numbers round.

[Anna Shymansky]

Okay.

[Felix Salmon]

My number this week is 37%, 0.37. This one came out from a Pew Research poll, and it was looking at Internet use around the world and in developed countries where basically everyone is online. And in fact, the idea of going online is something which is. It doesn't even make any sense anymore. We're always online. Our phones are always connected. Our computers are always connected. It's not something where you need to press a button and dial up and go online. But the one thing which you do need to actively do is call up Twitter, call up Facebook. You do go on Twitter. You do go on Facebook. So what you can do is you can measure how many people go on social media. In the United States, it's 69% of Americans use social media. In Germany, it's 37%. That's my number. It's 0.37. Germans. 37% of Germans actually use social media at all.

[Anna Shymansky]

I wonder if they live rich. I kind of am envious of that.

[Jordan Weissman]

Interesting. I wonder if there's like a demographic reason or if there's also.

[Anna Shymansky]

Or they actually read books instead. Richer, more intellectually fulfilling.

[Jordan Weissman]

Feld would suggest that that may not be the case.

[Felix Salmon]

Unless you consider sending a soccer ball in the mail to be social media analog.

[Jordan Weissman]

Social media, Anna, My number is somewhat of a sad number, I'd say. Well, it's 3.8%. That is Turkey's current account deficit. Your current account deficit is essentially a measurement of whether You're a net debtor or net lender. If you have a deficit, that means you rely on foreign capital to meet your domestic consumption investment needs. Point of this, this story is that I think that this is, right now, the only thing standing between Turkey and total authoritarianism after last week's referendum result, where Erdogan essentially now has his executive presidency, has tremendous powers. And what we've seen in the last year in Turkey is. Is really, truly devastating. But because their economy is still heavily reliant on foreign capital, that. That hopefully will somewhat restrain him in the way that other countries like Russia that have a much different. They're not as reliant because they have a lot of natural resources. It's quite different. So, although I am concerned about the market's ability to restrain some of these strong men, I'm hoping that this will help somewhat moving forward.

[Anna Shymansky]

I was gonna say we just did an entire episode about how the markets fail this job consistently.

[Jordan Weissman]

Yes, I know. This is what I was thinking. But I will say recently at my last job, every time Erdogan did something, he would then send out Mehmet Simsek as deputy Prime Minister to essentially calm the markets, which to me suggested they would have these investor calls, and he would do this little dog and pony show, like, nothing to see here, folks, which suggested that he still understood that at the end of the day, maybe there's only so far he can go. And as I've said, from what we discussed last week, this is a big concern I have, but I'm hoping it restrains him somewhat.

[Felix Salmon]

So I'm going to come up with the second number, which is 2 million, which is the number of Venezuelans who came out on the street to protest Nicolas Maduro. And it's. I mean, it's looking very much. Right now, Nicolas Maduro, the president of Venezuela, is in his sort of Bill O'Reilly mode. He's going to be out any minute now.

[Jordan Weissman]

He's not going to get $25 million.

[Felix Salmon]

Well, he's probably got more than that.

[Jordan Weissman]

Probably get far more from FX arbitrage. You make a lot of nice, but.

[Felix Salmon]

Yeah, I feel you're absolutely right there. Whereas sooner or later, Erdogan is going to wind up on the receiving end of the popular opinion, which he still, weirdly, is on the beneficiary end of right now.

[Anna Shymansky]

Well, just like. I mean, it's interesting because it's an urban, rural split.

[Jordan Weissman]

Oh, totally.

[Anna Shymansky]

So, in a way, that disadvantages them because it means that all the angry people in the cities can show up in the city streets and start demonstrating. Whereas if your supporters are in Anatolia, it's a little different.

[Jordan Weissman]

Yeah.

[Anna Shymansky]

Bloomberg just had a piece called the Bond market prefers dictators to democracies.

[Jordan Weissman]

Right. Although again, I'm not saying I necessarily agree with this, but part of the argument is that now that we have the referendum result and he has. His executive presidency was essentially all he's been working towards. People think now he may actually pull back because the argument is this is all he's been working towards. So even though he'll make some noise about the death penalty, all these things.

[Felix Salmon]

That this actually, he's like Hank Paulson. If you give him a bazooka, he'll decide he doesn't need to use it to use it.

[Jordan Weissman]

Exactly. That is, I think, what the markets are actually pricing in right now, which I have no idea if that's actually accurate or not. Most likely it's not, but one can hope.

[Anna Shymansky]

Yes. My number's $400. This is the best story of the week.

[Felix Salmon]

Oh, is this about juice?

[Anna Shymansky]

Yes, this is. Yeah. So I wanted to, I wanted to make this a whole segment, but we're going to reserve it for the numbers round. So $400 is the cost of the Juicero juice making machine. Juicero is a. A very hyped startup that has received over $100 million in venture funding. And its promise was it was going to make. It was going to be the apple of cold pressed juice. It was going to make this machine that just made fabulous, fabulous juice for people who had the money to blow on it. And like, apparently the machine was able to like put 4 tons of pressure on these bags of juice materials that were, you know, and that was going to get that perfect squeeze. Why I'm bringing this up this week is because Bloomberg had a fantastic article where they discovered that you could just take one of Juicero's juice bags and using your bare hands, squeeze it and get basically the exact same result as the $400 machine.

[Felix Salmon]

The same amount of juice in the same amount of time. Although given that you can only get the bags if you own the machine, I'm not sure how this actually helps you.

[Anna Shymansky]

Well, so I think it just. So this is a question, right? Like, if you are so, so determined to get Juicero's juice, will you still pony up for the $400 machine just so that you can get the bag? You know, I think that the, just the kind of, the halo of bullshit around this company is going to be devastating. It's just knowing that you're Getting ripped off. Essentially you're getting sold pre made juicers.

[Felix Salmon]

But this is a discounted machine. It was $700. They've now discounted it to 400.

[Jordan Weissman]

And maybe they'll just switch. It'll be like printers all of a sudden. They'll make the machine itself very cheap. But then the juice bags will cost like $400.

[Felix Salmon]

It'll be like your toners, and they will expire. This is my favorite thing about Juicero is that apparently it's a feature rather than the bug, that if you put your bag in the machine and it's one day out of date, the machine will refuse to press it.

[Anna Shymansky]

One day.

[Felix Salmon]

But now we know. But now we know that you can take the bag out and you can just press it yourself.

[Anna Shymansky]

No, but I think you're right about they make this machine cheaper and the bag's expensive. That I can see it surviving because then the halo of bullshit disappears. Disappears to some degree.

[Felix Salmon]

How cheap would the machine need to be in order for you to buy a Juicero machine?

[Anna Shymansky]

I literally have put up a, I one time post on Instagram. A message said if anyone ever sees me buying $10 juice, they are entitled to shoot me with a dart gun and drag me out of the store. Like, I have never, like, just tranquilize me.

[Jordan Weissman]

It is not difficult to buy $10 juice.

[Anna Shymansky]

I know, that's what I'm saying.

[Felix Salmon]

They are everywhere in New York City and there's this chain called Organic Avenue which specializes in $10, which recently got sold by one private equity to a company, to another private equity company because they can't make it work. And it turns out that the number of people with that kind of disposable income to spend on $10 juices is maybe a little bit lower than we had suspected, perhaps.

[Jordan Weissman]

And going back, sorry, to our previous discussion, one of my favorite data points, or not really a data point, [e-mail], one of their products that they sell is a $190 bag of dog food. What it is a New Zealand lamb eight pound bag of dog food that costs $190.

[Felix Salmon]

Wait, for eight pounds of lamb?

[Anna Shymansky]

Yes. Wait, you could just buy the lamb.

[Jordan Weissman]

You could probably buy more than one lamb.

[Anna Shymansky]

Digit the meat.

[Felix Salmon]

I have a very lovely halal butcher on 9th street in the East Village who will sell me eight pounds of lamb for much less than $190. And I can guarantee you that my dog, dog, my hypothetical dog would prefer it to this.

[Jordan Weissman]

Whatever you are buying.

[Anna Shymansky]

Yes.

[Felix Salmon]

That's amazing. Okay, I think that's it. On on which note, if if you have a dog you would like to feed some lamb, just let us know on slate moneylate.com and we won't be able to help you because we are not going to send you a hundred and ninety dollar bag of lamb from Chewy.com but keep us posted all the same. And if you do buy $190 bags of lamb, please write in and explain the logic. If you have a Juicero juicer, please write in and explain the logic. Because it would be great if we could have like a call in show next week from someone who has one of these things and goes oh well yeah, Juice but. So yeah, keep us posted and listen next week where we will have have an equally fascinating discussion but not about Juice. Many thanks to Zach Dynasty for producing this week and all of the other production crew here at Panoply Towers. Steve Lichti, June Thomas, Andy Bowers, all of the Panoply shows can be found@Panoply FM. Thanks for listening. Join us next week and subscribe. Just hit that subscribe button because it'll be even better next week. We'll talk to you then on Slate Money.