These Are the Stocks to Buy In 2026

Summary

The Compound and Friends: "These Are the Stocks to Buy In 2026"

Date: January 16, 2026
Hosts: Josh Brown, Michael Batnick
Guest: JC Peretz

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Episode Overview

This lively episode explores which stocks and sectors are best positioned for gains in 2026, with deep-dives into commodities, small caps, international markets, and why trend-following continues to matter. The hosts welcome technical analyst JC Peretz for an energetic roundtable—full of actionable insights, analysis of historical cycles, and a signature blend of irreverence and investing wisdom.

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Key Discussion Points and Insights

1. The New Commodity Supercycle

• Commodities, especially gold and silver, have exploded since the start of the year—potentially marking the early phase of a new "supercycle."
  • Michael Batnik [00:17]: "Historically these bull markets don't just last a few quarters or a few years. They last 10, 20."
  • Josh Brown [00:04]: "Starting the first of the year, it was like a brand new bull market just started for a lot of them."
• The consensus: it's not too late to ride this trend; if you think the commodity rally is over, "you're betting this is the shortest supercycle ever."

2. Lessons from Blow-Ups: Why Smart People Do Dumb Things

• Warren Buffett’s famous anecdote about Long-Term Capital Management (LTCM) sets the stage for risks of overconfidence.
  • Buffett Audio Clip [11:19-13:05]:
    • "To make money they didn't have and didn't need, they risked what they did have and did need. And that's foolish."
• Recognizing and exploiting both your own behavioral biases and those of others is key to long-term success.
  • Michael Batnick [14:03]: "You don't have to be smarter than everybody else, you just have to be slightly less stupid."

3. The Four "Fade Groups"—Who To Bet Against

JC Peretz and the hosts share a tactical framework:

• Sell-side analysts—prone to herding and conflicts of interest.
• Asset managers (esp. hedge funds)—data shows they’re often wrong at consensus moments, especially on futures positioning.
• Journalists—by the time mainstream media highlights a trend or sector, it’s late.
• Economists—often wrong because they ignore "what is" (market prices) in favor of "what should be" (models/data).
• Michael Batnick [24:28]: "There's a lot of information out there. There's a lot of noise. Focus on these. Do the opposite. Especially when they all agree."

4. The Power of Trends & Breakouts

• Strength is not a red flag—most investors miss out because they fear buying at highs.
  • Michael Batnik [46:44]: "The best time to buy stocks is when it’s making new highs. We have the data."
  • JC Peretz [47:09]: "Asset prices don't oscillate...they're going up, or they're going down, or they're doing nothing."
• The myth of “weak market breadth” is debunked; concentration in leaders does not equal danger if participation (breadth) is rising.

5. Small Caps Poised for Rebound

• Small caps have been base-building since 2021. Multiple indexes and sectors within small caps (industrials, materials, tech, financials) now show breakouts or major bases that suggest large upside.
  • Michael Batnik [56:05]: "You want to walk through it? ...This thing has done nothing since the end of 21."
  • JC Peretz [56:19]: “The bigger the base, the higher in space.”
• Debate over Russell 2000 (all comers) vs. S&P 600 (earnings requirement) and how profitless companies have driven outperformance in recent runs.

6. International Equities—Breakout at Last

• For the first time in over a decade, non-U.S. equities have decisively outperformed U.S. stocks—especially EM ex-China, Europe, and Japan.
  • Michael Batnik [39:41]: "Emerging markets EX China up 35%. Emerging markets with China up 34%. All Country World Index X North America up 32%. IFA... over 30%."
• The trend may have several years left to run, reflecting long cycles of mean reversion and global synchronization.

7. Bullish Confirmation: Dow Theory & Breadth

• Industrials and transports both at all-time highs confirm underlying strength ("Dow Theory"); NYSE Composite also at record highs.
  • Josh Brown [44:24]: "Industrials and transports...have never been higher."
• The team emphasizes that new highs are historically bullish, not a reason for skepticism.

8. Commodities & Energy—2026’s Opportunity?

• Energy (oil, oil services, refiners) now shows the same type of breakout/base as gold before its huge run.
  • Michael Batnik [60:43]: "Look at that base, bro. By the way, gold looks just like this before it broke out."
• Services (Baker Hughes, Halliburton, Solaris) could be the trade of the year, as few investors own or overweight the sector.

9. Magazine Covers as Contrarian Indicators

• Price action regularly reverses after major media covers declare a bubble, crash, or coronation.
  • Michael Batnik [35:59]: "The rule of thumb is whenever there's a chart on the cover of the magazine, you buy stocks."
• Example: "Beware the Bubble" Economist cover marks more bull fuel, not a peak.

10. Rotation Within Tech ("Mag 7" vs. Semis + Next Gen 100)

• Mega cap tech’s relative performance has faded; “next 100” NASDAQ stocks and semiconductors (semis at new highs) now lead.
  • Michael Batnik [53:46]: "Practically every stock is going up except those [Mag 7]."

11. Prediction Markets: A Fad, Not a Threat?

• Vigorous debate over whether binary prediction markets will ever rival traditional securities markets.
  • Michael Batnik [78:04]: "If these prediction markets didn't suck so much...they're nothing. It's an irrelevant penny stock scam."

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Notable Quotes & Memorable Moments

Commodities & Behavioral Contrarianism

• Michael Batnik [14:03]: "You don't have to be smarter than everybody else, you just have to be slightly less stupid."
• Josh Brown [13:05]: "The more arrogant people are about what they think they're good at is one...needless risk, risking what you did have and did need for more."

On Fading Consensus

• Batnik [24:28]: "There's a lot of information out there. There's a lot of noise. Focus on these. Do the opposite. Especially when they all agree."

On Buying Highs and Momentum

• Michael Batnik [46:44]: "The best time to buy stocks is when it’s making new highs. We have the data, we have the math."
• JC Peretz [47:09]: "Asset prices don't oscillate...they're going up, or they're going down, or they're doing nothing."

Humor & Life Advice

• Batnik [06:22]: "You provide and you hire people to do all that shit. Don't worry about it...go make money."
• Batnik [61:28]: (on oil service stocks) "Allegedly they're in the oil and gas space, but I don't know. Maybe it’s a Ponzi scheme."

Market Wisdom

• JC Peretz [47:16]: "If you want to manage a portfolio, you better be comfortable with buying things after they’ve already doubled. If not, you’re not going to last."

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Sector & Stock-Specific Highlights

• Small Caps — Now developing actionable bases across major sectors. Both small-cap indexes (Russell 2000, S&P 600) and industries (industrials, tech, financials, energy) highlighted.
• Commodities — Silver, gold, oil, energy services (Solaris, Baker Hughes, Halliburton) called out for current and future upside.
• International Stocks — Clear outperformance seen in EM ex-China, Europe, Japan; the trend may be persistent.
• Tech & Mega Cap Rotation — The semiconductors and "next-gen" mid-cap tech (QQQJ) show strength as the "Mag 7" pause.
• Financials — U.S. large caps (Morgan Stanley, Goldman Sachs) remain in uptrends; European and Japanese financials also strong.

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Timestamps for Key Segments

• Commodity Rally, Gold & Silver: [00:00–01:00]
• Day Trading Stories (Kenny): [01:06–02:56]
• Buffett LTCM Clip & Behavioral Lessons: [11:19–14:55]
• "Fade Groups": [19:23–24:35]
• Equal-Weight vs. Cap-Weighted Indexes: [26:08–28:32]
• Consumer Discretionary & Sentiment: [29:07–30:16]
• Magazine Covers as Contrarian Signals: [35:43–37:31]
• International Outperformance: [39:40–43:07]
• Small Cap Breakouts & Sectors: [55:09–60:25]
• Energy & Oil Services: [60:25–61:44]
• US Financials & Technicals: [68:15–69:59]
• Prediction Markets Debate: [77:08–82:14]

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Conclusion & Actionable Takeaways

• Stay With the Trend: Don’t overthink breakouts and all-time highs; momentum is real.
• Commodities and Energy Are Early in New Cycles: Ongoing strength signals opportunity, not exhaustion.
• Small Caps & International Stocks: After years of underperformance, they may lead the next phase.
• Avoid Consensus Traps: Be wary of analyst, media, and economist groupthink.
• Watch for Rotations: Tech leadership is shifting beneath the surface; watch semis, “Next Gen 100.”
• Don’t Bet Against the Market When It’s Strong: Highs are to be bought, not faded.

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For charts and further reading, visit trendlabs.com and review the Chart Summit 2026 presentations.

JC Peretz: “We want to be buying stocks, we want to be buying breakouts…I think [2026] could be a K-shaped market: there will be huge winners, huge losers, and some that just trade flat.” [66:00]

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End of summary

Transcript

[Josh Brown]

You are so early to the commodity rally.

[Michael Batnik]

Dude, I said gold. 5,000 people thought I was crazy.

[Josh Brown]

No, but even like last summer, commodities had been rallying, but not like this. And they just. They just exploded. Starting the first of the year, it was like a brand new bull market just started for a lot of them.

[Michael Batnik]

And here's the interesting part about commodities, is that historically these bull markets don't just last a few quarters or a few years. They last 10, 20.

[Josh Brown]

Yeah.

[Michael Batnik]

So if you're. If you're betting this is over, then you're betting that this is the shortest commodity super cycle ever.

[JC Peretz]

Who's your boy that did the chart? Y. Is it Alfonso that did the gold to stock chart? And it looks like it might be breaking out.

[Michael Batnik]

Oh, yeah.

[JC Peretz]

You know what I'm talking about.

[Michael Batnik]

Of course.

[JC Peretz]

That's a great chart.

[Michael Batnik]

Gold dow. I think that was Rick. Slick Rick. Okay, we got this. This Lebanese Mexican dude.

[Josh Brown]

Really?

[Michael Batnik]

Slick Rick. He's the man.

[Josh Brown]

He does commodities only or.

[Michael Batnik]

No, he just does everything, dude. He's like overlaying tack with like the Israeli shekel. Like this guy's.

[JC Peretz]

He's a lesbianese Mexican.

[Michael Batnik]

Yeah, they got those. Yeah, Lebanese Mexicans. Yeah.

[JC Peretz]

You got a lot of talented people on your roster.

[Michael Batnik]

Thank you. I agree.

[Josh Brown]

How's. How's Kenny doing?

[Michael Batnik]

Dude, Kenny is a legend.

[Josh Brown]

I know, he's hilarious.

[Michael Batnik]

Love Kenny. He showed up funniest. Showed up on the morning show today with no shirt on, right? Just like this like 1970s disco shirt and his chest hair all sticking out.

[Josh Brown]

Yeah. Oh, yeah. Like a jacket with no shirt under it.

[JC Peretz]

Wait for the audience. Not everybody knows Kenny.

[Michael Batnik]

So Kenny. If you don't know Kenny.

[Josh Brown]

Kenny Glick, AKA Kung Fu Kenny, AKA Hit the Bid. But he's like. He's like Jefferson Kroll. Jefferson Kroll.

[JC Peretz]

He was like. He was like Davey day trader before, like, way back in the day.

[Josh Brown]

But like I was gonna say that.

[JC Peretz]

But he actually knows stocks. Like, he was. Is the funniest person on camera talking about 100.

[Michael Batnik]

He's the grandfather of day trading. Because think about that. Because day trading didn't exist until Kenny got on the scene. And he was there day one. He's the grandfather.

[JC Peretz]

He invented day trading.

[Josh Brown]

No, he's a mid to late 1990s vintage day trader. They don't make them. They don't make them like that.

[Michael Batnik]

They don't make him like that. No, you can't.

[Josh Brown]

And most of those guys have not started.

[JC Peretz]

Does he still day trade?

[Michael Batnik]

Right. That's my point. Does he still day trades every day?

[Josh Brown]

Dude, if you still have capital and, and you're doing it like late 90s style, you figured something out.

[Michael Batnik]

Well, he only, he trades the only intraday strategy I've ever seen work, which is you're fading rallies and you're. And you're buying dips, particularly after earnings. They cross the one day anchored vwap, and then that's your risk reward.

[JC Peretz]

Is it like a 20 minute strategy or.

[Michael Batnik]

Well, you're looking at a one minute anchored VWAP. Right. And then as soon as it gets above that and it mean reverts up on a sell off, you're in. And then on a, on a, on a rally, you're fading the breakdown.

[JC Peretz]

That's gotta be good for your blood pressure.

[Michael Batnik]

I mean, listen, most trades are in the first half an hour of the day, so you're in your world's.

[Josh Brown]

I tried day trading in like 98. I was the world's worst. I do not have the temperament for that. And I was one of those guys where I get into a trade and then it would start going against me. And the three guys around me were like, dude, that's. You gotta sell it now. I'm like, no. I start reading about the fundamentals of the company. They said, I don't think you understand what we're doing here. This is ticks, bro. This is not about being right. And that doesn't sit well with me. I sort of, I sort of can't operate that way.

[Michael Batnik]

We've known each other for 20 years. You're still like, oh, yeah, you like that stock. Why? Yeah, no, because I think I could sell it at a higher price. What do you mean?

[Warren Buffett]

Why?

[Josh Brown]

You know what? It's not a character flaw. It's due to my superior intellect. I have to have the reasoning behind everything.

[Michael Batnik]

Yeah.

[Josh Brown]

Even if it's fake, I still need something.

[Michael Batnik]

You sound like one of these, like old angry macro perma bears.

[Josh Brown]

You know, I'm 48 and I'm a perma bull.

[Michael Batnik]

No, I know, I know.

[Josh Brown]

Other than that.

[Michael Batnik]

No, no, but the things you're saying, like how you're speaking, obviously you're being sarcastic, but like those angry perma bulls actually do think that. Angry perma bull.

[Josh Brown]

Angry perma bulls.

[Michael Batnik]

Bears.

[Josh Brown]

Perma bears, yeah.

[Michael Batnik]

You know that their intellect is so far superior than the market.

[Josh Brown]

Dude, I'm joking.

[Michael Batnik]

No, I know.

[JC Peretz]

For as long as you look. As long as you know Josh, have you noticed that every single year he says, I'm effing this age? I remember when he was like, Dude, I'm 38 years old.

[Josh Brown]

I don't have time for that.

[JC Peretz]

41 years old.

[Josh Brown]

I don't have time for that. I'm getting too old for this.

[Michael Batnik]

Yeah, but now as you're getting older, you're like, oh, you know, he was right.

[JC Peretz]

I've never said. I've never. I've never said those words out loud. I'm X years old.

[Josh Brown]

Yes, but there are things that you now acknowledge that you're too old for.

[JC Peretz]

Like, I'm still feeling good.

[Josh Brown]

I feel great. But I'm too old for games. That's.

[Michael Batnik]

What kind of games?

[Josh Brown]

Like, games people play with each other. I don't. I don't play games with people.

[JC Peretz]

I thought you meant, like, Call of Duty. I don't play that anymore.

[Josh Brown]

No, no, no, no, no, no. Like, I don't do. I don't do group texts. I remove myself from. Like, I'm like, in five group texts. I used to be in 50. I used to be. I used to be in group texts with people from college. At a certain point, like, are we even talking about anymore?

[JC Peretz]

48.

[Josh Brown]

What is this even about?

[Michael Batnik]

No, but you want to know something about Josh is that, you know, he gave me a lot of advice over the years because he was, like, ahead of the game. Like, he had his kids before me. Like, he was just a little bit older in. Not just in age, but in other things, too. And it's like, all the things that dads tell you all are true, right? Like, you know, as you become a dad. I mean, my oldest is five. The twins are three. So, like. But all the things that you ever said.

[Josh Brown]

Do you remember I used to tell you, let me say. Let me say this. Like, 10 years ago, you'd be like, yo, what up? I'm in Manhattan. What are we doing? I'm like. I'm like, I'm taking the train home and taking my kid to Little League. And you're like, oh, I respect that. That makes sense. How many days a week do you do that? I'm like, pretty much five days a week. And you're like, really? I'm like, just you wait. And now you're in the shit.

[Michael Batnik]

That's right.

[Josh Brown]

You're in the shit. For real.

[Michael Batnik]

No, it's all good. You know, some of the.

[Josh Brown]

You know, it's the best time of your life.

[Michael Batnik]

You want to know one of the best pieces of advice you ever gave me? Right? This is a good one, because I think about this a lot.

[Josh Brown]

By Six Flags at four and a quarter.

[Michael Batnik]

Yeah, well, it was. But it was three And a half. It was like three and a half, but that's another story. It tripled. I thought I was Warren Buffett. It was just Josh getting lucky, as it turns out. But so. So I walk into Josh's office one day and I was like, you know, I can't, like, screw anything in. I can't hang a picture on the wall. Like, I'm such an idiot. Like, I can't do any of this stuff. And Josh goes, let me stop you right there. You go, you provide and you. You hire people to do all that shit. Don't worry about it.

[Josh Brown]

Yeah.

[Michael Batnik]

And I'm like, yeah. He's like, yeah, yeah, go make money. Don't worry about it. I'm like, oh, okay. Let me tell you, I think about that shit all the time.

[Josh Brown]

But what was the alternative? You're gonna go to carpentry school?

[Michael Batnik]

Well, I'm in my early 20s, so, like, I don't know anything. So, like, now, in hindsight, I'm like, yeah, I'm not doing that. Josh says, just pay someone to do it.

[Josh Brown]

Your time is better spent reading, writing, researching, talking to people.

[JC Peretz]

Candlestick.

[Josh Brown]

Your time is not well spent learning how to screw in a light bulb.

[Michael Batnik]

So thank you.

[Josh Brown]

You're welcome. You're welcome.

[JC Peretz]

How's Disney?

[Michael Batnik]

Listen, it can't be a bear market, man. Talking $15 hot dogs, bro.

[Josh Brown]

$15 hot dogs go to Vegas. $30.

[Michael Batnik]

I was just there.

[Josh Brown]

$30 hot dogs.

[Michael Batnik]

I was just there. $30 peanuts in the room.

[JC Peretz]

I had a $16 Subway sandwich. So offensive.

[Michael Batnik]

That's gross. In New York, bro.

[JC Peretz]

No, in Vegas.

[Josh Brown]

The last time I was in. The last time I was in Vegas was with JC and Fami and we went to Pierro's and a week later, somebody tried to blow the restaurant up.

[Michael Batnik]

Are you serious?

[JC Peretz]

Uh huh. I love Vegas.

[Josh Brown]

I didn't send you that link. No, somebody. Somebody in the middle of the night went and lit the restaurant on fire. I swear to God, a week after we went there, wow.

[Michael Batnik]

This place was like a little DL. Like, I could see how that would happen there.

[Josh Brown]

It's. Pierrot was in one of the scenes with Sharon Stone and Teniro in Casino.

[JC Peretz]

Get up.

[Josh Brown]

Not that one, the other one.

[Michael Batnik]

Dude, that place was good.

[Josh Brown]

Yeah, yeah, it was. It was legit.

[JC Peretz]

That scene where he's shaking the table.

[Josh Brown]

Yeah. Not the one where he busts her with Lester's, but maybe the one where she's like, really?

[JC Peretz]

I wouldn't do that.

[Josh Brown]

All right, let's get the show on the road. We got things to do.

[Michael Batnik]

All right, you know the drill.

[Josh Brown]

All right. Thank you, John. What episode is this?

[Michael Batnik]

My friend, this is public episode 225.

[JC Peretz]

Whoa, whoa, whoa. Stop the clock. Here's a word from our sponsor. Today's show is sponsored by Public, the investing platform for those who take it seriously. On Public, you can build a multi asset portfolio of stocks, bonds, options and crypto and now generated assets which allow you to turn any idea into an investable index with AI. It all starts with your prompt. From renewable energy companies with high free cash flow to semiconductor suppliers growing revenue over 20% year over year, you can literally type any prompt and put the AI to work. It screens thousands of stocks, builds a one of a kind index and lets you back test it against the S&P 500. Then you can invest in a few clicks. Generated assets are like ETFs with infinite possibilities, completely customizable and based on your thesis, not someone else's. Go to public.com compound and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com compound paid for by Public Investing. Full disclosure in Podcast Description.

[Michael Batnik]

Welcome to the Compound and friends. All opinions expressed by Josh Brown, Michael Batnik and their castmates are solely their own opinions and do not reflect the opinion of Ritholtz Wealth Management. This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this podcast.

[Josh Brown]

Ladies and gentlemen, you are now rocking with the best investing podcast on God's Green Earth, episode 225. Super blessed. Whole gang is here. Daniel is back. John's in the house. Duncan Nicole, fan favorite, returning champion, making his I've lost count appearance on the Compounded. Friends. Y' all give it up for J.C. perez. You hear it? Your hands broken?

[JC Peretz]

All right.

[Josh Brown]

All right, guys. JC Is the founder and chief technician of Trend Labs, a technical analysis focused research platform. JC also authors Everybody's Wrong, where he delivers charts and actionable ideas on a daily basis. Jc welcome back to the show.

[Michael Batnik]

Thank you guys. My favorite show to do in the whole world. Number one, Easy.

[Josh Brown]

We're really excited to have you here. So today's gonna be fun because I know you have a bunch of charts that we're gonna take a look at and then I'm going to show you some charts that you may either like or be offended by. I'm not sure yet, but we'll do yours first.

[Michael Batnik]

If you bring me an arithmetic scale price chart, I'm going To throw it at you.

[Josh Brown]

Something tells me I'm already in trouble. All right. I did want to. Am I, Can I play, I could play an Instagram, right, John?

[Michael Batnik]

Yep.

[Josh Brown]

All right.

[Michael Batnik]

Play an Instagram.

[JC Peretz]

Yeah. That's not, that's all.

[Michael Batnik]

Is that what the kids.

[JC Peretz]

Dude, he's 40. He's 48. He really is 48.

[Josh Brown]

All right. Is this working?

[JC Peretz]

Oh, I don't know, Warren.

[Michael Batnik]

Who even uses Instagram?

[Josh Brown]

I don't know if it's work. Oh, wait, wait, I got it, I got it, I got it.

[JC Peretz]

Hold on.

[Warren Buffett]

The whole Long Term Capital Management, I hope most of you are familiar with it, but the whole story is really fascinating because if you take John Merriweather and Eric Rosenfeld, Larry Hillenbrand, Steg Hawkins, Victor Agani, Smart Men, the two Nobel Prize winners, Merton Shoals, if you take the 16 of them, they probably have as high an average IQ as any. Sixteen people working together in one business in the country, including at Microsoft or wherever you want to name. So there's incredible amount of intellect in that room. Now you combine that with the fact that those 16 had had extensive experience in the field they were operating. I mean, it was not a bunch of guys who had made their money, you know, selling men's clothing and then all of a sudden went into scourge business or anything. They had, they, they'd had in aggregate the 16 that probably had 350 or 400 years of experience doing exactly what they were doing. And then you throw in the third factor that most of them had virtually all of their very substantial net worths in the business. So they had their own money up, hundreds and hundreds of millions of dollars of their own money up, super high intellect, working in a field they knew, and essentially they went broke. And that to me is absolutely fascinating. I mean, I, I, if I ever write a book, it's going to be called why Smart People Do Dumb Things. My partner says it should be autobiographical. Yeah, but this might be an interesting illustration. And these are perfectly decent guys. I, you know, I respect them and they helped me out when I had problems with Solomon. And so they're not bad people at all. But to make money they didn't have and didn't need, they risked what they did have and did need. And that's foolish. That is just plain foolish.

[Josh Brown]

All right, that's the goat.

[JC Peretz]

That's the goat.

[Josh Brown]

That's the goat. Warren Buffett commenting on Long Term Capital Markets Management, Long Term Capital Management, which was a prominent hedge fund that blew up in the late 1990s and I think there's a lot in there, a lot to that. The first big idea is these are literally the smartest people there are working in money management. These are Nobel prize winners, theoreticians, professional traders, asset managers, pickleball players, a whole and a whole room full of them. Whole. It's not even like one, one guy making an error, it's a whole committee. I think there's a lesson in there that blow ups can happen and they probably will happen. The more arrogant people are about what they think they're, they're good at is one. And then that second part, like needless risk, risking risking. They all of them were multi, multi, multimillionaires at the time that they were putting on the trades that melted down. What are your thoughts?

[Michael Batnik]

You know, I think it gets back to something that, thank God I understood is that you don't have to be smarter than everybody else, you just have to be slightly less stupid. So that's number one. It's about understanding the flaws that we have as human beings so that we don't fall victim to a lot of the mistakes that other people do. Right. We have to understand the way the human mind works. We have to understand those emotions when they come, recognize it, laugh about it and then not do anything about it, not act upon those emotions. Now there's a second element to that, which is where I come in, where not only are we recognizing our own human behaviors, but we are taking advantage of the fact that all the other humans not only do. They don't know that they have those human flaws, they don't even care to know and they're just living their lives. But us as investors, we, we can exploit their flaws for our own selfish endeavors so that we can make money for ourselves.

[Josh Brown]

But does, but does. Is there a such thing as being overly aware of those emotions and then having that be a limiting factor where you don't take enough risk or you don't trust your instinct enough because you might say to yourself, oh, here I go again, my hubris.

[Michael Batnik]

Yeah.

[Josh Brown]

And then a huge winning trade goes by because you were so busy self deprecating. Isn't that like also a thing?

[Michael Batnik]

I mean we could talk about precious metals over the last few months and every day it goes up another 4% and I'm like, oh my God, like there's no way this can keep going. Meanwhile, I haven't sold a single precious metal stock, right. Because it has a hit of our target, right? So it goes back to pre nailing down what you're going to do so that you're completely eliminating your brain from the situation. You're just following the plan. So what I think this morning or yesterday doesn't matter. I'm like, dude, there's no way this is going to keep going up. Oh, okay. Well, it doubled after I said that. So, you know, it doesn't matter what I think. Right. Just follow the plan. Stick to the plan. So I think that that's the big thing. And in terms of, like, you know, an overabundance of information, you know, there's a specific groups that you want to fade. You want to fade. And if you could throw up. Slide one, the new slide one. I just added another slide because we didn't have enough. You want to fade.

[Josh Brown]

I love this.

[Michael Batnik]

All right, why don't we get into this, and I'll tell you what the four fade groups are.

[Josh Brown]

Okay?

[Michael Batnik]

So you're talking about smart people blowing themselves up in 1998. Well, Isaac Newton, I don't know, pretty freaking smart. He blew himself up, too. And for the same reasons that humans are blowing themselves up today has nothing to do with intelligence or that. Isaac Newton was the man. He's a human at the end of the day. So what happens?

[Josh Brown]

Isaac Newton was the man.

[Michael Batnik]

He was the man.

[Josh Brown]

I think. I think. I think scholars believe that he was one of the 10 smartest people who ever lived.

[Michael Batnik]

Yeah.

[Josh Brown]

So, okay, very important.

[Michael Batnik]

So nobody's going to argue. Nobody's going to say, oh, that guy was an idiot. Right? No, he's just a human. Right. So what happens? So he starts, this is the South Seas stock back in the day. If you don't know the story, go learn about the story. Just one of the great bubbles of all time. So I'm not. We're not going to go into the bubble. The point is he starts buying it, right? Then he quickly doubles his money. Isaac Newton.

[Josh Brown]

This is in 1718 for the fort. For the people not looking at the.

[Michael Batnik]

Chart, this is the roaring 20s of the 17.

[Josh Brown]

1700S.

[Michael Batnik]

So Isaac Newton doubles his money. Nice trade. Not bad, Isaac. Not bad, bro. Right? And then, you know what I'm saying? Nice little double. And then all of a sudden, what happens? Newton's neighbors are getting rich. They're still in it. And now he's got the fomo. He's like, bro.

[Josh Brown]

So he doubles. He's out. And then the people around him that he knows he's smarter than are making even more money. That will make you insane.

[Michael Batnik]

Yeah, yeah. And so he's like, you know, what the hell with it. I'm in.

[Josh Brown]

Oh, my God.

[Michael Batnik]

At the top. And then he blew himself up.

[Josh Brown]

Yeah. Exit's broke. We know that for sure.

[Michael Batnik]

Yeah, bro.

[Josh Brown]

You heard that story.

[JC Peretz]

There's that famous quote that is, I think, misattributed to him. Somebody said that I can calculate the heavenly bodies, but not the madness of the crowd or madness of people.

[Josh Brown]

It's probably made up, but it's a perfect quote. I don't think he actually said it.

[JC Peretz]

By the way, that chart kind of looks like silver. A little bit.

[Josh Brown]

Yes.

[Michael Batnik]

Well, half every uptrend is going to look like that. Don't even go there with me.

[JC Peretz]

No, no, no, that's going. That's not an uptrend. That's not an uptrend. That. That's a vertical trend.

[Josh Brown]

Listen, that's parabolic, is the message here. It does. This is not a contest of who's the smartest. That's number one. Right. And then the number two is comparison. My gains versus someone else's gains and, oh, shit, I better catch up.

[Michael Batnik]

Being too smart might even be a negative.

[Josh Brown]

I've seen a million examples.

[JC Peretz]

The midw. The midwit curve is real.

[Josh Brown]

Yeah.

[JC Peretz]

One thing that Buffett didn't mention in that video, and it's sort of besides the point, but also relevant. They were levered 250 to 1. Probably like, not a great.

[Josh Brown]

But that's the arrogance. They wouldn't do it, wouldn't do that if they weren't thinking to themselves, we have the whole machine.

[JC Peretz]

It's fixed income arbitrage. What can go wrong? Like, these things don't really move that much until they do.

[Michael Batnik]

That's right.

[Josh Brown]

Right. So. So there's a couple of components to it. It's like we know exactly what we're doing. Therefore, why 100 times leverage when we could be 200? Why 200? We could be 250. So that's one thing. And the second thing is just like, look at. Look at how brilliant we are. And the third thing is, why are we putting the pedal to the metal? Do we really need to make this much money? And of course, none of them did at the now. They might. None of them did at the time. So I think those are really crucial lessons for investors. I just thought that was an interesting thing to see Buffett pointing that out.

[Michael Batnik]

So it's two things. It's the internal and the external. If you could throw up the slide, too, I just added one more. So it's the internal and the external.

[Josh Brown]

Good luck today, John.

[Michael Batnik]

No, no, that was it. That was it. So, you know, it's about recognizing our own flaws and then taking advantage of the others. Right. For our own selfish gains. So to me, there are four basic fade groups. You have sell side analysts, right? So they come with their own conflicts of interest, of course, like, you know, they're going to say something bad about a company, but they're working on an M and a deal. They're going to get a tap on the shoulder. And if you think that doesn't happen, I think you're crazy. So there's that. There's the career risk where, you know, if there are 30 analysts covering a stock and they're all bullish and you're not and you're wrong, you're going to be looking for a job. Right. And it's not worth the career risk because little Timmy's private school and Martha's Botox and the country club and the whole thing, it's not worth it.

[Josh Brown]

Call it hurting.

[Michael Batnik]

Hurting, Hurting mentality. Right. Hurting is very strong safety in the, in the 100%. So you have that. So we could take advantage of that for our own selfish endeavor. So you got the four, you got the four. Is that me or is that you, Josh? Dude, who's. What are we doing here?

[Josh Brown]

Kids got tonsilitis or something?

[Michael Batnik]

I don't know. Is this your first podcast?

[Josh Brown]

It might be amateur hour.

[Michael Batnik]

All right, Wall street, right? Wall street analyst, Right. Great fade. Particularly at consensus. Remember three years ago. Exactly. Coming into 23, Wall street was at a consensus that the stock market was going to fall in 2023. As it turns out, the NASDAQ doubled instead. Right. Classic. It's a better signal when they're all bearish versus when they're all bullish. If they're all bullish, that's standard hurting. Yeah. S and P is going to go up 8 to 10%, even though it never does.

[Josh Brown]

Not the fade. The fade is when they're all bearish.

[Michael Batnik]

Yes.

[Josh Brown]

Okay. It's asymmetric. It's not the same thing.

[Michael Batnik]

Not the same.

[Josh Brown]

I like that.

[Michael Batnik]

Asset managers, these are hedge funds. Asset managers. These are historically the worst investors of all time. We have the data. Right. So how do you measure that?

[Josh Brown]

Makes perfect sense.

[JC Peretz]

What do you mean?

[Michael Batnik]

Well, in the futures market in particular, Right. So you're seeing futures positioning, you're looking at the speculators. The asset managers, when they're at a consensus, do the opposite. Right. Like, for example, they had a historic net short position in Russell 2000 futures this summer. How'd that work out? Right. For Example, but we can go. It goes on right now.

[Josh Brown]

Hedges, though, now, isn't it. Is it ever good if, if they lose money in the Russell futures. Maybe they're hedge fund.

[Michael Batnik]

There's this thought process that hedge fund managers hedge. No, no, no. It's just a fugazi they're in.

[Josh Brown]

Okay, Right. So those are concentrated bets, not hedges.

[Michael Batnik]

Yeah.

[Josh Brown]

Okay.

[Michael Batnik]

Asset managers. Fate. I'm at consensus. Journalists. Because they're so good at their jobs, right? Journalists are not traders. In a lot of cases, they can't afford to be. In a lot of cases they have the money, but legally they can because they're not allowed. Right. So they're not traders. Fine. They're really good at what they do. What do they do? They see what the narrative is. They're there to sell newspapers, magazines, Right? So they want to see what people are talking about and then write articles about that. By the time the journalist figures that out, by the time they write their article, submit the COVID all of that gets approved. By the time that hits the shelves, it's too late. Take the other side, right?

[Josh Brown]

Like, because they're writing about something that already happened and explaining it to people, and they do a really good job at that. But that is not the same thing as trying to find a prospective opportunity that hasn't happened.

[JC Peretz]

But within journalists, it depends on the journalist. For example, Barron's only writes about the stock market, Right. They're pretty much on top of it. Now, of course, there's been some magazine covers, but like, you can't fit every Barron's cover. When the Economist is putting Lululemon on the COVID Yeah, that's like, wait, what? Why is the Economist talking about Lululemon, Forbes, Newsweek, Time?

[Josh Brown]

I like that distinction. Where, look, if you. If you're feeding everybody who's writing about stocks everywhere, you're fading. Some people that focus on stocks 247 and they understand everything we just said. That's not the answer. I do agree with Michael. When a stock story crosses over into the mainstream media, you're in the eighth.

[Michael Batnik]

Inning or a theme or anything like that. Like, how many AI covers did we have? At the end of the day, every.

[Josh Brown]

Investor is doing X, right?

[JC Peretz]

That was an account.

[Michael Batnik]

We talked about it on the show. And again, it's not like we're just fading magazine covers. It's like when it lines up with price and it lines up with futures, positioning and other things.

[Josh Brown]

The Time Person of the year is like the seven most important AI CEOs perfect a month ago. It's beyond perfect.

[Michael Batnik]

Perfect.

[Josh Brown]

Okay.

[Michael Batnik]

And then the fourth one is economists. And the economist is easy. Why are they wrong all the time? It's very simple by design. They ignore what actually is happening in favor of what they think should be happening based on information that may or may not have happened. Right. So wait, are you surprised that they're wrong all the time?

[Josh Brown]

Say more.

[Michael Batnik]

Okay, so economists, what do they do? They ignore what is happening. The prices of assets is what is happening in favor. And I know you have economists friends, so don't get sensitive about it. It's just what it is. Yeah, they. He does. Right, so you got.

[Josh Brown]

You do I Maybe.

[Michael Batnik]

Maybe. I don't know. Don't tell anybody. All right, so what are they. Look, they ignore what is happening in favor of data that may or may not have happened because we know it. It may probably will get revised.

[Josh Brown]

Right, right.

[Michael Batnik]

And ignore. It's like pay no attention to what is happening.

[Josh Brown]

Right, right. So if you're not fate economists on the economy. Fate economists, when they start talking about the stock market.

[Michael Batnik]

Hell yeah.

[Josh Brown]

Yeah.

[Michael Batnik]

Hell yeah. All right, you guys ready? All right, so those are the four fade groups. Simple.

[Josh Brown]

Okay.

[Michael Batnik]

We don't have to complicate things. So there's a lot of information out there. There's a lot of noise. Focus on these. Do the opposite. Especially when they all agree.

[Josh Brown]

Okay.

[Michael Batnik]

All right.

[Josh Brown]

I don't hate that.

[JC Peretz]

I think. And we're painting with a broad brush.

[Josh Brown]

Of course.

[JC Peretz]

There's some awesome.

[Josh Brown]

Every single person, obviously.

[Michael Batnik]

I know sell side analysts. I know asset managers and journalists and maybe I know economists.

[Josh Brown]

There's a. There's an economist somewhere listening to us saying fade podcasters. Yeah, for sure.

[Michael Batnik]

For sure. And then what happened to that guy?

[Josh Brown]

Fully justified.

[Michael Batnik]

Whatever happened to that guy who was hating on blog. On the blog. On the bloggers back in the day that nobody ever heard from again. Yeah, right. How'd that work out for him?

[Josh Brown]

Not great.

[JC Peretz]

Hating on bloggers.

[Michael Batnik]

Dude, he was hating. Josh went. Went off. We don't have to go there.

[Josh Brown]

There was a guy. I'm not going to say his name. He sucks. He was a CNBC guy in like 0809, 2010, and blogs were a brand new thing. He was like forced to react to all these stories that were happening on blogs, like Barry's site and Zero Hedge and you know, like all the stuff.

[Michael Batnik]

The reform broker.

[Josh Brown]

Yeah. So he would do a segment, I think it was nightly blog you. And he would just go off on somebody that was like from Twitter and he didn't make any friends. And I don't I don't know if he was right or wrong. I forgot what he was saying. But that was a thing, okay, that was a, it was a moment.

[Michael Batnik]

Don't fade the bloggers. I'll tell you what they got. They got because they got followers, right? I mean, myself included. I mean, I'm there now. I wasn't them, but I'm there now. All right, let's get into it. You want to talk markets or what?

[Josh Brown]

Yes, let's do it. All right, let's do it.

[Michael Batnik]

So speaking of economists, the economists tell me that US GDP, 70% of that is, is consumer. So I don't know what a GDP is, but 70% of a lot. 70% of anything is a lot, right?

[Josh Brown]

Yes.

[Michael Batnik]

So we're seeing new all time highs in consumer discretionary on both a market cap weighted and an equally weighted basis. Is that bearish?

[JC Peretz]

I don't think so.

[Josh Brown]

Is this heavily influenced by the stocks that are in the index or. It doesn't matter really. The, the, the biggest market cap stocks in the index.

[Michael Batnik]

So in the discretionary, Tesla and Amazon are each over 20%.

[Josh Brown]

That's why I'm asking.

[Michael Batnik]

Right? So fine. People are like, oh, it's just the big ones. Well, the equally weighted consumer discretionary index that completely eliminates those stocks out of the equation altogether is also making new all time highs.

[Josh Brown]

Yep. Okay. That's the signal, right? How many, how many people fail to correct themselves and look at the equal weight version of the index for that confirmation?

[Michael Batnik]

Humans are lazy, bro.

[Josh Brown]

Right. It's like, doesn't take much to double check. If you just look at an index and say, oh, it's all Apple and Microsoft. Well wait, what does equal weight tech look like?

[Michael Batnik]

Right.

[Josh Brown]

Not everybody will do that.

[Michael Batnik]

And what does small cap tech look like? And what does mid cap tech look like?

[Josh Brown]

Are you less bullish if you don't have that confirmation in the equal weight?

[Michael Batnik]

You know, it's funny because, well, first of all, in the consumer discretionary consumers have been quite the underperformer of this bull market, right? It's been technology, industrials, financials, communications. It's been the other offensive groups, not discretionary. So looking at discretionary underperforming, if, if there were others in that group underperforming, that would be a problem. But because it's the only one we've been betting on rotation into it, I'm.

[Josh Brown]

Going to sort of say something that you probably don't care about, but I actually think there's a huge flaw with consumer discretionary being in A sector because the bifurcation between travel and restaurants last year is the reason that the consumer stocks, quote unquote underperformed as a sector. The reality is they're not really a sector. People don't necessarily choose between I'm going to go out to eat versus I'm going to go on a trip. They probably can do both if they feel like it. The restaurant stock's been horrible. A lot of consumer discretionary stocks have been horrible. The travel stocks could not have been better. Even like I know airlines are not in it, but like the Expedias of the world.

[Michael Batnik]

But airlines you could argue should be in it. And Delta and United Air are making new all time highs.

[Josh Brown]

And then here's the other thing.

[Michael Batnik]

And Walmart is not in it and it's making an all time highs.

[Josh Brown]

What if I just hit take consumer discretionary and throw it out and look at Visa and MasterCard instead?

[Michael Batnik]

Right.

[Josh Brown]

I like that signal better.

[Michael Batnik]

Well, Jeff Mackey would agree with a lot of the things you're saying. Yeah, right. I talked to Jeff a lot and he's like, like, you know, Uber's in the consumer stock. Apple's a consumer stock, Google's a consumer stock.

[Josh Brown]

Right.

[JC Peretz]

So weird.

[Josh Brown]

So, so just go, Visa, MasterCard, let that. What are they, what are they saying? What are their share prices saying? I'd rather know that than start cherry picking. Like what is Applebee's? Think of the environment. Who gives a shit? They might be doing really well or really poorly. Chili's relative to their peers.

[Michael Batnik]

Chili's though.

[Josh Brown]

Yeah, great, okay, I like that concept.

[Michael Batnik]

Okay, but meanwhile look what's happening. Consumer sentiment is actually the lowest levels ever. So you got the humans, pure politics. Yeah, maybe, fine. But the humans are very upset and the price of assets is making new highs.

[JC Peretz]

Yeah, these are different people. The people that are upset don't own stocks.

[Michael Batnik]

Yeah, well, I'll tell you what. In the, in 1999 when this was at highs, the stock market crashed from there. And in 2019, with this as it was, and this was the highs, we had three major corrections including a full on bear market and a historic market crash immediately after. They were all super giddy. So yeah, these might be different people, it might be politics. I hear all that shit. All I know is these people are angry and the consumer stocks are making new all time highs. I couldn't think of a better combination.

[Josh Brown]

I can't believe this hasn't bounced.

[JC Peretz]

Well, I guess what, this will never, this will never be where, where it was. This is a, this is A secular bear market.

[Josh Brown]

Yeah, I agree. Because the top is the advent of the Internet. It's the Internet makes people miserable.

[JC Peretz]

Nobody answers questions. People are miserable on the Internet. This will never be over 110 in our lifetime.

[Michael Batnik]

I guess we'll see. My point is the humans are angry and the stocks that represent the humans.

[JC Peretz]

Humans are.

[Michael Batnik]

Humans are angry and the stocks that represent the behavior of those humans are making all time highs. I love that combination.

[Josh Brown]

Okay. I like. That's a good counterpoint to the people that are talking about bubbles and euphoria and all these things. Yeah, yeah. Okay.

[Michael Batnik]

Okay. So let's. Let's do a little. Let's have some fun here. We're looking at MicroStrategy hitting new lows more recently. And this was. Look at that top right when that cover came off. If you want to go to the next one, zoom in on that cover. You know, right there. The Bitcoin alchemist. The volatility virtuoso, Michael Saylor. Michael Saylor. So just look at where that peaked.

[Josh Brown]

Right, that's January 30, 2025. That's a year ago next week.

[Michael Batnik]

Yep. So that's not a coincidence.

[JC Peretz]

Do you have a relative chart?

[Michael Batnik]

Jose, settle down. Here we go. So microstrategy relative to Bitcoin.

[Josh Brown]

Oh, so beautiful.

[Michael Batnik]

So this is a ratio of the price of MicroStrategy, which is doing the Ponzi with the Bitcoin and then the actual price of bitcoin. Right. And then notice when it peaked. It peaked on November 20th of 2024. Does anyone know what happened the day before that?

[Josh Brown]

The coronation of Donald Trump.

[JC Peretz]

No, wait, the day before what?

[Michael Batnik]

I'm sorry, I was thinking November 20th, Thanksgiving, November 20th of 2024, the ratio between MicroStrategy and Bitcoin peaked. In other words, up until November 20th, if you wanted to put on a leverage long position in Bitcoin and make money in Bitcoin, MicroStrategy was the preferred.

[Josh Brown]

Vehicle over the ETFs.

[JC Peretz]

No, that was January 2020. Yeah. What. What happened that day?

[Michael Batnik]

November 20th, 2024 was the peak and it crashed after that. The day before that, November 19th was the day that options started trading on iBIT.

[JC Peretz]

Oh, that's good. Oh, well, that explains it.

[Josh Brown]

Price discovery, dude.

[JC Peretz]

No, no, no. It's the opposite.

[Michael Batnik]

It's not necessary.

[JC Peretz]

You don't need this anymore.

[Michael Batnik]

You don't need it anymore.

[JC Peretz]

Superfluous. And by the way, it's not. That's not a Ponzi scheme. Literally.

[Michael Batnik]

I'm not smart enough to Understand? I don't care. It's a Ponzi. I hope it is. It doesn't matter to me at all.

[Josh Brown]

Right?

[Michael Batnik]

So my point is, not only does it not matter, I got long yesterday.

[Josh Brown]

You're long. Microstrategy.

[Michael Batnik]

The Ponzi. Yeah, throw it up. There it is.

[JC Peretz]

It's a false breakdown.

[Josh Brown]

You're short the Ponzi.

[Michael Batnik]

Long the Ponzi.

[Josh Brown]

It's not a Ponzi.

[Michael Batnik]

Okay, fine, great. No, but he doesn't matter whether it is or not.

[Josh Brown]

It's a digital assets Treasury Corporation.

[Michael Batnik]

Yeah, sure.

[Josh Brown]

Okay, so you think we're seeing a false breakdown in strategy, so.

[Michael Batnik]

Dude, I'm telling you right now. How long have you known me? Every year is the same shit, man. At the end of the year, between that Christmas, New Year's, you got the B squads on the desks, you got like, nobody's. You got.

[Josh Brown]

There's no liquidity, tax law, selling. They're puking stocks up.

[Michael Batnik]

There's just low liquidity. Weird shit happens. And then you get back to work and they squeeze them higher. And going into that week, I'm like, crypto. Crypto, Coinbase, Microstrategy. I didn't know. I had to see confirmation. And then we got it. So I got long yesterday. Pretty aggressively so, I might add. Let's see how it works for me. I'm gonna keep a tight stop.

[Josh Brown]

You like this the way this one looks? Because it's a false breakdown that's now recovering versus the coinbases. Or just buying a bitcoin etf.

[Michael Batnik]

I'm in Coinbase already also.

[Josh Brown]

Okay.

[Michael Batnik]

But I put on a microstrategy position yesterday, which I hadn't in a long time.

[Josh Brown]

Okay. All right.

[Michael Batnik]

And then if you want to throw up the bitcoin.

[JC Peretz]

Wait, jc, what does a tight stop mean to you? I'm curious.

[Michael Batnik]

Well, I'm using a time stop because it's either going to go or it's not. And if it's going to go, it's going to go now. So I might be out of this tomorrow.

[JC Peretz]

Time stop. Like a mental thing.

[Michael Batnik]

Yeah.

[JC Peretz]

Oh, okay.

[Michael Batnik]

Yeah, Yeah, I like it.

[Josh Brown]

So if it doesn't work now, I'm in this for two. I love three days.

[JC Peretz]

I love that.

[Michael Batnik]

Well, I'd like to be in it for three months, but if it doesn't go in the first couple days, I'm out.

[JC Peretz]

Right. Because if trades don't work immediately when you think they should.

[Michael Batnik]

Not all of them, but this one, definitely.

[JC Peretz]

Yeah. Okay.

[Michael Batnik]

This one's either going to go or it's not.

[Josh Brown]

This looks. This looks good to me.

[Michael Batnik]

So there's your anchored V web from the highs last year. You know, you're looking at 97. If we're above 97, the squeeze is. Oh.

[Josh Brown]

I mean, this is like. This is like. I don't know how. How meaningful is that? Is that moving average? Is that a 10 day?

[JC Peretz]

It's a VWAP.

[Josh Brown]

That's the VWAP.

[Michael Batnik]

Volume weighted average price.

[Josh Brown]

All right, so they're kind of. They're coming for the stock. They're coming for their coin.

[Michael Batnik]

That's right. That's right. So funny money, long. And then I just want to remind everybody that we've seen this story before. There's Fat Fred Savage right there on the COVID of Forbes. And then remember what happened wasn't.

[JC Peretz]

Didn't you make that.

[Michael Batnik]

That's a Josh line. Yeah.

[Josh Brown]

So Sam Bankman fried Fat Fred Savage is funny.

[Michael Batnik]

That was you.

[Josh Brown]

Yeah. It's funny me calling anyone that, but. Okay. Got it. He's in. What is he gonna do about it? Nothing.

[Michael Batnik]

He's playing chess with Diddy.

[Josh Brown]

Yeah, I'm not worried about it.

[Michael Batnik]

All right, so my point is that we've seen this before, right? And we'll see it again. So it's not like, funny ha ha. Not like. No, no, no. Pay attention because we will see this again. This is not like a one and done. This happens again and again and again. I probably have the greatest collection of magazine covers probably in the world. I don't think anybody has a collection like mine. I have magazines that go back to the bicycle bubble of the late 1800s. I got some shit, right? And it's the same story again and again and again.

[Josh Brown]

What? The rise and fall of a. Of. Of a theme.

[Michael Batnik]

Also all kinds of things. All kinds of things. All right, you're right.

[JC Peretz]

That is one of the constants. Forever and ever and ever will never not happen.

[Josh Brown]

I hope they.

[Michael Batnik]

I'm going to bring them next time I'm on the show. I'm going to bring a bunch of magazines and we'll look at it. I have some good stuff. All right, so this was in November. So this was very creative. The best ones usually are. So this one is a guy doing a yard sale down the. Down the mountain, and then they turned his skis into red arrows pointing down how the markets could topple the economy.

[Josh Brown]

Josh, what does that mean? Like, if the markets. If the markets get crushed, the economy will get crushed with it.

[Michael Batnik]

Notice. Hold on. Go back, go back, go back. Notice the map of the World on his ass. That was good, right?

[JC Peretz]

Look, it's really good.

[Josh Brown]

It's snow comprising the continent.

[Michael Batnik]

So good.

[Josh Brown]

I wouldn't have seen that if you pointed out.

[Michael Batnik]

I know. So good. So good. Anyway, so the rule of thumb is whenever there's a chart on the COVID of the magazine, you buy stocks.

[Josh Brown]

Yeah.

[Michael Batnik]

Right. So I polled all my associates, and we agreed that that was a chart, technically, with the arrows.

[Josh Brown]

Yeah.

[Michael Batnik]

And so here's the returns of stocks since then.

[JC Peretz]

Oh, micros.

[Michael Batnik]

Micro caps up 15%. Tranny's up 12. Small caps up 12. Mid caps up 10.

[Josh Brown]

Don't say trannies.

[JC Peretz]

We do this every Transportation American.

[Josh Brown]

They don't like it.

[Michael Batnik]

Transportation Americans.

[Josh Brown]

Disrespectful.

[Michael Batnik]

So stocks absolutely ripping since then. Because. Of course they are. Because if the. If these British journalists are telling you that the stock market is going to topple, it's probably going to be the opposite. Right. And sure enough, it was.

[Josh Brown]

This is unbelievable, the unanimity with which every one of these things proceeded to work.

[Michael Batnik]

Is this surprising to you?

[Josh Brown]

Yeah. So I guess the economist has to wait for Q2 for markets to topple the economy. Oh, here we go. So they. So the journalists weren't wrong. It's just a bubble. That's all.

[Michael Batnik]

So Ritholtz is slipping into my DMs.

[Josh Brown]

Oh, boy.

[Michael Batnik]

You know.

[Josh Brown]

Oh, boy.

[Michael Batnik]

He does that late at night sometimes.

[Josh Brown]

Yeah.

[Michael Batnik]

And so we're talking about this one. What do you guys think about this one?

[Josh Brown]

Beware the Bubble. How to Survive the Year Ahead. What day did this come out?

[Michael Batnik]

Is this last week?

[Josh Brown]

This last week?

[Michael Batnik]

Yeah.

[JC Peretz]

I just.

[Josh Brown]

What are they. Is it even worth commenting on what they mean? Which bubble?

[JC Peretz]

AI.

[Michael Batnik]

It's just.

[Josh Brown]

It's AI every.

[Michael Batnik]

It's just a bubble. All the bubbles.

[Josh Brown]

It's just everything is a bubble, you.

[Michael Batnik]

Know, all the bubbles, Josh.

[Josh Brown]

So for me, the cover's not enough. I have to read the spiel.

[Michael Batnik]

Got it. Of course.

[Josh Brown]

See what they're saying.

[Michael Batnik]

Yeah, yeah. He buys the Playboy for the articles. Yeah, yeah, yeah.

[Josh Brown]

No, I just have to. I can't paint something if I don't even know. They're not even saying what the bubble is in. It's almost like this cover will be wrong or right no matter what, because they're not saying what the bubble's in.

[Michael Batnik]

That's right. Well, I gave a presentation a couple months ago, I think, in Vegas, and I asked everybody, you know, raise your hand if you think we're in a bubble. And the entire room raised their hand. And I'm like, I Didn't even mention an asshole.

[Josh Brown]

Who's the audience?

[Michael Batnik]

I don't know, like rich investors.

[Josh Brown]

Right. Raise your hand if we're in a bubble and it doesn't even matter.

[Michael Batnik]

Doesn't matter. Okay, it was great.

[Josh Brown]

What do you think most of them think? You mean, are they thinking like Nvidia AI?

[Michael Batnik]

Probably.

[Josh Brown]

Okay. All right.

[Michael Batnik]

Yeah, probably.

[Josh Brown]

Okay.

[Michael Batnik]

All right. I mean, listen, any, anything that's going up that you're not in is a bubble, right?

[Josh Brown]

I think there are a lot of very well known stocks that are not in tech that are definitely, if not in bubbles, on their way. Costco, Walmart. These should not be 40 times earnings.

[Michael Batnik]

Oh, here we go. Earnings.

[JC Peretz]

Those are not bubbles.

[Josh Brown]

They're on their way.

[Michael Batnik]

Dude, 90% of Americans live within 10 miles of a Walmart. How about that for a funny thing?

[Josh Brown]

Stop saying it's not a good Costco.

[JC Peretz]

Can't be a bubble.

[Josh Brown]

I'm saying historically, people didn't buy those stocks at that expensive of a price without getting their asses kicked eventually.

[Michael Batnik]

Don't worry. This time it's different.

[Josh Brown]

Fair enough. All right, go ahead.

[Michael Batnik]

All right, so last year, a year ago today, check the tape. I told you that International was going to outperform the United States and the dollar was going to get smoked, right?

[Josh Brown]

Yes.

[Michael Batnik]

And you said that. I hope you're right, because that would be really good for our industry. As in financial advisers, you know, that would be really good. So I'm curious. It was said that then, was it? And how.

[Josh Brown]

Well, for the first time in a decade, my advisors don't have to explain to clients why they own anything other than the s and P500 or the keys. Am I overstating it?

[Michael Batnik]

No.

[Josh Brown]

Okay. Like that has been a conversation. Not every client, not every year. But it's like, what, what is the point of emerging markets? What is the point of Western Europe? What is the point of span? Different people at different times. Nobody's asking that question right now. So nobody who stuck it out.

[Michael Batnik]

That's right.

[Josh Brown]

Yeah.

[Michael Batnik]

So emerging markets EX China up 35%. Emerging markets with China up 34%. All Country World Index X North America up 32%. IFA, which is a lot of Europe and Japan up over 30%. You know, go down the list.

[Josh Brown]

If you pull back, if you pull this back 15 years and just look at cumulative returns, that trade could have like five more years to go and still not get. Get to where the S and P. And it may never. I'm not, I'm not telling you. That'll mean revert and you'll get those types of returns. But, like, for people who think they missed it, what do. What do you think on the technicals?

[Michael Batnik]

I agree wholeheartedly with you that, I mean, this was a long time of the other side, you know, so There's.

[Josh Brown]

It's.

[Michael Batnik]

It's 15 years and we don't need to, like. If you. If you want to see what all these countries look like, go watch the last episode I was in in the summer and the same. We went through excep. Higher and more to the right.

[Josh Brown]

Right.

[Michael Batnik]

But all these countries are up. Latin America, South Africa, Asia, Southeast Asia, all across Europe, up and to the right.

[Josh Brown]

Japan, China.

[JC Peretz]

I love that. Higher and more to the right.

[Michael Batnik]

Yeah, higher than they were in the summer and more to the right. Right. So the United States put up historic numbers. 20 year for the NASDAQ, 17 year for the S P 500. And the US was one of the worst countries on the planet.

[Josh Brown]

Yeah. And that's. And that's like, even with all the AI that people were saying, there's no AI stocks in the. Like, Right. Like Europe has asml. That's it. And. Well, is there a plot?

[JC Peretz]

Is this an advertisement?

[Michael Batnik]

Let's go. So I dove. So I dove into this in our chart, kid.

[Josh Brown]

Put a banner ad. Yeah.

[Michael Batnik]

So this is brought to you by our sponsor, Charge Summit 2026. No, I mean, because I get. I dive into all of these charts.

[Josh Brown]

You're the only person that this is allowed for.

[Michael Batnik]

Well, I.

[Josh Brown]

All right, go.

[Michael Batnik]

Go download the deck. Go download the deck from the presentation. You have friends on this list.

[Josh Brown]

I'm going to see Katie Stockton in 45 minutes from now.

[Michael Batnik]

Well, tell her I said, what's up? She was great. David Lundgren, Frank Capillari, Straz. And I gave a great presentation. Go download the deck. Check it out.

[Josh Brown]

Hey, this is a. This is actually a pretty damn good roster. How do you get all these people?

[Michael Batnik]

Drinking buddies.

[JC Peretz]

Is that. Is that Max Kellerman on top?

[Warren Buffett]

Right?

[Michael Batnik]

Who is that? Yeah, Max Kellerman, talking about boxing. John Netto, market wizard. So you could download my deck and all the other decks and watch all the presentations. It's totally free, so go check that out.

[Josh Brown]

Chartsummit.com all right, so these are, in your opinion, like, some of the more interesting technicians who made presentations.

[Michael Batnik]

I mean, listen, Katie's great, Frank is great. Netto Lundgren, they're all fantastic. But I got to tell you, me and stress, this presentation was pretty good.

[Josh Brown]

Did any of the technicians disagree with what you guys are telling people?

[Michael Batnik]

You Know, people weigh different things more heavily and lighter. Katie uses a lot more oscillators than I do. For example, she uses the Ichiro clouds and all that stuff.

[Josh Brown]

She's a demarc person.

[Michael Batnik]

She's a demarc. Lundgren looks at things from a different perspective. Frank Cap as well. So like, you know, check it out. Enjoy. Ryan Dietrich as well. All right, so I don't want to get into all of the different international markets and everything like that. We've done that before. We go over it on the presentation. Go check that out there. This is the big one. These are the assets throughout 2025 and the returns. Bitcoin was actually down bonds, Flat S&P's put up record numbers with the Qs and just massive underperformers. Look at silver.

[JC Peretz]

Why you say record numbers? What do you mean by that?

[Michael Batnik]

17% return in the S&P 500, double the annual average return.

[JC Peretz]

Yeah, I'd say that's, that's nowhere close to a record. But it's a good, it's a good year.

[Josh Brown]

It's not a record amount, but it's a, it's a better year than the average. Yeah, of course.

[Michael Batnik]

A great year. No one's going to say it wasn't a great year.

[Josh Brown]

It's a great year.

[Michael Batnik]

But, but underperformed practically everything else.

[Josh Brown]

Look at that. Look at this though. Silver up 150%. Gold of 65 emerging markets, 34 developed stocks, 32. Like that's where the real money was made last year. Yeah, it's, I mean, it's obvious.

[Michael Batnik]

Yeah.

[Josh Brown]

So it's too late. My barber asked me this morning, a haircut from Dominic.

[Michael Batnik]

How early do you get a haircut?

[Josh Brown]

Bellmore barber, he wants to know if he should buy more silver.

[JC Peretz]

Seriously?

[Josh Brown]

Yeah. So he said, he said, I'm hearing, I'm hearing it could go higher from here.

[JC Peretz]

Are you making a joke or swear?

[Josh Brown]

My life. And I said, I said, dominic, definitely go higher from here. Yeah, I don't, I'm not going to be the one that tells you that's right. But just understand like it was 16, it's 90, you know, I'm saying like, like it's not early. So I mean, I don't, I don't know what to tell anybody.

[Michael Batnik]

We'll get to the silver in a second. Let's stick with the stocks for right now. I just kind of wanted to put things in perspective. Look at the industrials and the transports. Both of these indexes are making new highs. This, these indexes go back to the late 1800s. They've never been higher. Closing at all time highs together.

[Josh Brown]

That's so bullish.

[Michael Batnik]

So it's less of a signal. I'm getting, you know, emails from, you know, journalists and stuff like that. Like, oh, big signal. It's like. No, no, no. It's not so much a signal as it is confirmation. Yeah, Confirmation of what? Confirmation of all the other things that are suggesting and have been suggesting that we're in a bull market. This just confirms that all those things.

[Josh Brown]

Are in fact something about Dow theory though. This is my, this is my. This is like anecdotally what I find. When it is in favor of the bulls, people will point it out. And then when it's not because transports are doing badly, people just forget about it. Like who cares? Do you, do you get that sense also?

[Michael Batnik]

I feel like just nobody cares and I'm the old man in the room telling you that this is the most important thing that you need to be watching. All right.

[Josh Brown]

Because I want to point out we had a really great run of years where the S and P was making highs or the Dow was making highs and the transports were not. And people like me very cleverly substituted the socks.

[Michael Batnik]

Yeah.

[Josh Brown]

And I would say semis are the new transports. Anyway, don't care that the airlines don't look good. And like the markets did great. Like it. It didn't matter that we didn't have that confirmation, I guess is what I'm trying to say. Now we have it. Okay. Convenient.

[Michael Batnik]

These divergences come at peaks like regularly. Even before COVID trainings were already rolling over. Look at the never change. Look at the New York Stock Exchange composite making all time highs. These are the stocks that trade on the world's most important exchange. You know how many mega cap tech stocks there are on the New York Stock Exchange? 3 United States Mega cap tech stocks, I should say. You got IBM Salesforce and Cisco. No, IBM Salesforce. And there's one more, Oracle. Those are the only three mega cap tech stocks on the New York Stock Exchange. Meanwhile the Nasdaq, you got Nvidia, Apple, Amazon, all those others, Taiwan, Semi. Also trades on the New York Stock Exchange, SAP, Novartis. You got over a third of the New York Stock Exchange is international companies. You're getting a lot more cyclicals there. You're not getting this mega cap tech exposure that you're getting in the nasdaq. The New York Stock Exchange is to me the best universe of stocks in the world.

[Josh Brown]

Okay, that's not obviously not bearish. I don't know if it's necessarily bullish.

[JC Peretz]

Oh, wait, Jason, let me ask a question. When people say to you I am uncomfortable, I am leaning bearish because everything is working, what do you say to that person?

[Michael Batnik]

I would say go back and study history.

[JC Peretz]

Meaning?

[Michael Batnik]

Meaning the best time to buy stocks is when it's making new highs. We have the data, we have the math. Right. We know that asset prices trend. Like, there's a lot about the market that we don't know, but there's a few things that we do know, and we know that asset prices trend. So if you're constantly fighting trends, then you are the sucker. Right. You want to be a house.

[Josh Brown]

Asset prices don't oscillate.

[Michael Batnik]

Right?

[Josh Brown]

They don't. It's not up, down, up, down, up, down. They're going up or they're going down or they're doing nothing.

[JC Peretz]

If you. If you are the type of personality where you think this is as good as it gets, you will not make money over time.

[Michael Batnik]

Forget who said it the other day and said, you know, if you want to manage money, you want to manage a portfolio, you better be. You better be comfortable with buying things after they've already doubled. Because if you're not, you're not going to last.

[Josh Brown]

Yeah, right. Because. Because there's a reason why something's doubled.

[Michael Batnik]

Yeah.

[Josh Brown]

And you'll find out later.

[Michael Batnik]

And you're not smart enough or informed enough to know yet. And you may never be, by the way.

[Josh Brown]

Right. So this is the problem with using intuition in the markets. It's like it's so obvious that nobody wants to buy something that was just five and now is 10.

[JC Peretz]

But you know what's so funny about this? Like, when I talk that the market is bullish and people accuse me of being bullish or naive, it's like this. I'm not giving you an opinion of what I think will happen in 12 months. I'm describing what is happening today.

[Michael Batnik]

That's right.

[JC Peretz]

And objectively, if you're fading every episode when we're bullish because the stock market is bullish, you're not going to make any money.

[Josh Brown]

We launched our RIA in September of 2013, and it's been a long time. But somebody once sent me the tweet where I. Back then, people used to go on this thing called Twitter and announce stuff. I tweeted a link to my blog post announcing the new firm, or maybe it was Barry's one or the other. Somebody sent me this, and, like, there were, like, 50 responses. Congratulations. So Happy for you guys. But like half the responses were top. Top 2013.

[Michael Batnik]

Yeah.

[Josh Brown]

Where was. Was the Dow at 18?

[Michael Batnik]

That was the end of the last decade. Remember that was that. We're talking about it last decade. We were just breaking out top.

[Josh Brown]

Barry and Josh just launched an R A top. Really?

[Michael Batnik]

Yeah, top, sure. With like 100 million.

[Josh Brown]

But, but the reason why they were saying that is not. They weren't saying that because like they're making fun of us. They're teasing us. They're saying that because in 2013 the market had finally come all the way back to the 07 high after having been cut in half.

[Michael Batnik]

That's why they're in 2020 and you.

[Josh Brown]

Have to buy tops. Yeah, because they're probably not tops.

[Michael Batnik]

That's right. It's very hard to do people think that the top of the chart means that there's resistance.

[JC Peretz]

Oh, it's the opposite.

[Josh Brown]

Well, people are out of their minds. They think, they think it's a personal top for them. Yeah, they think here we go again.

[JC Peretz]

Yes.

[Michael Batnik]

Yeah.

[Josh Brown]

Right. Like I'm going to top it by.

[JC Peretz]

Buying just my luck.

[Michael Batnik]

Right.

[JC Peretz]

You're not that important.

[Michael Batnik]

So to me it's a market of stocks. So we look at the S and P, The Dow, the NASDAQ, you know, we look at the Russell 3000. It's a market of stocks. At the end of the day.

[JC Peretz]

I know you've got a ratio of the smallest of the bigs.

[Michael Batnik]

Yeah, I'm getting. I'll get there. So here we're looking at the percentage of stocks on the New York Stock exchange above their 200 day moving average hit a new 52 week highs yesterday.

[Josh Brown]

So that also happened in 2021 though, is that. That's like not always great.

[Michael Batnik]

More stocks in uptrends is not a bad thing for the market.

[Josh Brown]

Yes, but it's not always a great moment to buy. That's all I'm saying.

[JC Peretz]

On average it is.

[Michael Batnik]

All I'm saying is that it's not always 2021.

[Josh Brown]

Hang on.

[Michael Batnik]

What I'm saying is these lies that they were telling you in the fourth quarter about how weakening breath and market deterioration. It was just sour grapes what they were saying. To quote Jeff Degraph, he called it sour grapes. He was right. It's just that the concentration of returns up until that point was so strong. That doesn't mean it's weak market breath. It's that the concentration of the best stocks.

[JC Peretz]

Amen, sister.

[Michael Batnik]

It's two different things.

[JC Peretz]

We know that the average return one year later is higher at an all time high than on all other days. We know so. We know that for a fact. So yes, obviously not always. Obviously. And also most of the time crashes don't start from all time highs. And if this is the top right here today and the market weakens and it starts to starts deteriorate, we see distribution, we see selling more 52 week lows, we'll see it.

[Michael Batnik]

People are like, oh, 1987 came out.

[JC Peretz]

You could change your mind.

[Michael Batnik]

People are like, oh, 1987 came out of nowhere. No, the market peaked in August. The crash wasn't until October.

[Josh Brown]

You know what else? People assume that like the typical investor is a lump sum investor. Like all right, here's everything.

[JC Peretz]

Putting it all in today. But Jesse say this loud. Stocks crash from oversold conditions. Stocks crash when they're in downtrends for the most part.

[Michael Batnik]

Yeah.

[JC Peretz]

They don't happen overnight.

[Michael Batnik]

Yeah, that's true. Yeah, that's right. Yeah, that's right.

[JC Peretz]

Let's keep going.

[Michael Batnik]

So here's a really interesting one. So this is so the NASDAQ hasn't made a new high since October. But this is the NASDAQ 100. Q. Q. Q. But NASDAQ stocks 101 through 200, which is the NASDAQ Next Gen 100.

[Josh Brown]

No, what is this? This is, this is an index.

[Michael Batnik]

This is 101 through 200.

[JC Peretz]

This is like Zoom.

[Michael Batnik]

This is the next hundred, like the smaller tech stocks.

[Josh Brown]

Oh, that's it. So it's qqq J.

[JC Peretz]

It has etf like peloton, like what's in here? I'm curious, have you ever looked at this? Yeah, yeah, back in the day.

[Michael Batnik]

So these are the next 100 names. So you're looking at companies between 20 and 40 billion dollars in market capitalization.

[Josh Brown]

So all right, so these are like big tech stocks. Not big enough to be in the NASDAQ one. This could be like Datadog or like I'm trying to think like.

[Michael Batnik]

So you're gonna get.

[JC Peretz]

Here we go. Sandisk, eBay, Fiserv, Teradyne, United Airlines. That's weird. Coreweave, Expedia, Kimberly Clark. There's some weird shit in the NASDAQ these days. But. But that's it.

[Michael Batnik]

You're getting four times the healthcare exposure. So a lot of these biotechs are not big enough to be in the NASDAQ 100. So you're gonna get a lot more healthcare here. So that certainly helps.

[JC Peretz]

Dude, how weird is this? Dollar tree And Ulta and United, like.

[Josh Brown]

There'S a big tre, you know, Walmart switched from the New York stock to the nasdaq.

[JC Peretz]

They're all bouncing from the nice. What's going on.

[Josh Brown]

So they want to be seen as growth companies, not as blue chips. That's like the NASDAQ. That's the wave.

[JC Peretz]

NASDAQ's got the crown.

[Michael Batnik]

Yeah, I don't think so. So, so the point is. So the point is, just because some of these big ones aren't working doesn't mean that tech stocks are not working. So what's hilarious. So this guy, this guy, Ron DeSantis, right. My understanding he's the. I think he's the governor of Florida.

[Warren Buffett]

Or something like that.

[Josh Brown]

You are correct.

[Michael Batnik]

So this guy's talking about market breath, you know, talking about how it's the Mag 7 economy and everything like that. A funny thing happened that day.

[Josh Brown]

Is this real?

[Michael Batnik]

A funny thing happened that day. That was the day that the Mag 7 stocks peaked on a relative basis and have gone.

[Josh Brown]

Can you read the tweet?

[Michael Batnik]

You want to read the tweet?

[Josh Brown]

Yeah.

[Michael Batnik]

The magnificent seven economy. Has there ever been a time in which the market was as skewed towards one sector and really one aspect of one sector as it is lately?

[Josh Brown]

So funny thing happened October 29, 2025. Thank you, Governor.

[Michael Batnik]

So funny thing happened. So not only was that not true. Right. He either didn't bother to count or he was lying. Either way, not acceptable. Since then, practically every stock is going up except those.

[Josh Brown]

Yeah, he should re. He should revisit that tweet.

[Michael Batnik]

Yeah.

[JC Peretz]

What a chart. So do you think that we're on false breakdown? Are we on a false breakdown? Watch. Or you think that it's got, it's got lower lows here.

[Michael Batnik]

Go to the next one. So what we've seen since then, the NASDAQ has yet to make a new high. And technology has massively underperformed in that environment. But, and you know, I like big butts. There's a big but. Throw up the next one. But semiconductors making all time highs on a relative basis, how bad could it be for tech if semis are still rolling? It's a software issue, it's a Mega Cap issue. But if semis are rolling, how bad could things get?

[JC Peretz]

So you're, you're buying the weakness of mega cap tech?

[Michael Batnik]

I personally, I mean, I bought Onda Se recently, but that's like, it's small, small communications equipment.

[JC Peretz]

I'm talking like Microsoft. Like, are you buying the weakness of Microsoft? I am not.

[Michael Batnik]

I have not yet.

[JC Peretz]

Microsoft looks heavy.

[Michael Batnik]

I am not yet. I think that this is going to be a process.

[Josh Brown]

Metal Meta looks lifeless.

[Michael Batnik]

I want to look.

[JC Peretz]

I want to look at Microsoft is worse than Meta.

[Michael Batnik]

So let's, let's talk about where I do want to look. Right. So go to the next one. And as I mentioned, the world looks great. You know, it's not a bull market for America. It's a bull market for Earth. Right? The planet that we live in. Bro, no earthlings.

[JC Peretz]

No, no, no. Tiny. No tiny Lithuanian stocks today, please.

[Michael Batnik]

No, no, no. We're not gonna go do this country thing. Check the tape. Go back to the. When I was in the summer for the 200th episode. And then all of those are just higher and more to the right.

[Josh Brown]

Yeah.

[Michael Batnik]

So we don't have to do this again. The world's making all time highs. And if you exclude America, also still making all time highs. We can move on. All right, so what are we gonna buy? So this one to me, I think this is a big chart right here. Throw up the small caps there on a relative basis. So this is the Malachi Tony market is what I call it. Just give the ball to the little guy and let him run with it. You know what I'm saying?

[Josh Brown]

Shout. Shout out to Tony.

[JC Peretz]

I did this on.

[Michael Batnik]

You got to get him on the show.

[Josh Brown]

I would love to. I don't know what we would talk about but go on. Anything so bad.

[JC Peretz]

I did this jc, I'll make the case for this ratio. The ross of the 2000 versus the large ones. That's going. Dude, it's working.

[Josh Brown]

This is this. So you know how you said asset prices trend? This one oscillates.

[JC Peretz]

It does.

[Josh Brown]

The Russell sucks.

[JC Peretz]

No, the relative ratio sucks everybody in.

[Michael Batnik]

You're talking about a relative ratio.

[Josh Brown]

No, I know. I'm just saying small caps suck everybody in periodically and then they roll.

[JC Peretz]

Is it going to stick this time?

[Michael Batnik]

Yeah, I think so. You want to walk through it?

[Josh Brown]

Given how bearish I am, it'll probably stick.

[JC Peretz]

I think this might be the time. I really do.

[Josh Brown]

I hope, I hope it's true.

[Michael Batnik]

Well, why don't we do some of the parts analysis of that? So let's look at the index. Look at this base.

[Josh Brown]

Yeah.

[Michael Batnik]

This thing has done nothing since the end of 21.

[JC Peretz]

Bigger the base.

[Michael Batnik]

Can I get one of these?

[JC Peretz]

JC, bigger the base. What do we say?

[Michael Batnik]

The bigger the base, the higher in space. Louise, is that funny?

[Josh Brown]

No, it's. I like it.

[Michael Batnik]

So I asked Alan Shaw, rest in peace before he passed. I'm like, where did you learn that? Because Louise Yamada Says she learned it from Alan Shaw. And Alan Shaw's older and I'm like.

[Josh Brown]

That'S why, isn't it?

[Michael Batnik]

No, you always quite a little way before. Dude. Alan Shaw is like a zillion years old and he learned it from his predecessors and he started in the 50s, so his predecessors were trading in the 30s and 40s and they taught him that. Wow. So this has to go way back, huh?

[JC Peretz]

That's wild.

[Michael Batnik]

I did the homework, I did the due diligence. Right. So small caps going up. And this is not oscillate. Josh, look at this long term chart. This is from the lower left to the upper right, bro.

[Josh Brown]

Yeah, I think I meant like relative to the S and P. Like there are times the Russell outperforms, but it doesn't last long.

[Michael Batnik]

I guess we'll see how long.

[Josh Brown]

And then relatively.

[Michael Batnik]

Because look, put up the communist ones. So these guys discriminate, right? Because you can get. They'll. In the Russell 2000 they'll let anybody in. But in the S P600 you got to be making money.

[Josh Brown]

Yeah. How dare the only profitable.

[Michael Batnik]

Yeah, you gotta be making money.

[Josh Brown]

You get more financials in the 600.

[Michael Batnik]

I think so what's hilarious about fundamental analysis is that the, the ones with the Russell 2000 that you don't need earnings, you could be losing a fortune. Don't matter, you're in. They're doing a lot better than the companies that are only in if they're making money. So if you're only buying good companies, you're missing out on the best performers. Yeah, good companies. Right. And then you could just look at the, the composition. You're getting, you're getting, you're getting a little more health care and you're getting less industrials. A little bit on the Russell 2000, but relatively comparable. So I just wanted to show that you're getting a lot more consumer discretionary in the s. P600.

[Josh Brown]

Russell 2000 is for the bigger small biotechs. Look. Yes, it's 19 biotech healthcare, which is mostly like profitless or barely profitable. Biotech.

[Michael Batnik]

Yeah, it's.

[Josh Brown]

It's 18 in the S&P 600. Banks.

[Michael Batnik]

Yeah.

[Josh Brown]

So makes sense, let me say. And banks is still pretty big in the Russell 2000.

[JC Peretz]

Josh always says it's only regionals.

[Michael Batnik]

Let's do some, let's do some of the parts. Let's do some of the parts. So first of all, this is the small cap momentum index making all time highs.

[Josh Brown]

Okay.

[Michael Batnik]

Okay. So this is not bearish. Right. These are the momentum Names doing well that tends to happen in healthy market environments. Now go to the industrials. All time highs for small cap industrials. All time highs for small cap materials. Right. All time highs for small cap technology. So when people are telling you that small cap stocks aren't working, maybe your small cap stocks aren't working but clearly small cap stocks are working. We can keep going and then you know the small cap financials.

[JC Peretz]

Oh my God.

[Michael Batnik]

Come on. Is there a more important base in the stock market right now than this?

[Josh Brown]

How does this one resolve?

[JC Peretz]

Way higher.

[Josh Brown]

Go right?

[JC Peretz]

Way higher.

[Josh Brown]

Look at what other ones doing time out. What the hell is a small cap financial?

[Michael Batnik]

Regionals.

[Josh Brown]

That's it.

[Michael Batnik]

There's 260 of them.

[Josh Brown]

Not even like sub region like thrifts. Like it's a lot of community banks.

[Michael Batnik]

It's a lot of small banks.

[Josh Brown]

Yeah, yeah.

[Michael Batnik]

There's some, there's some other things mixed in there that are a little bit lost but it's banks.

[JC Peretz]

It's Jackson Financial, Lincoln National.

[Josh Brown]

I own, I think I own. I think Kinsale is, is in this group.

[JC Peretz]

Hyper Sandler, Stepstone. We know these names.

[Josh Brown]

We know some of these.

[Michael Batnik]

All right.

[Josh Brown]

I want to dive in there.

[Michael Batnik]

You also got a couple hundred biotechnology stocks. Biotech hitting the Highest level since 2021. Healthcare big.

[Josh Brown]

I don't like to, I don't like to trade charts. Biotech given the nature of the tape bombs good and bad. Just. You know what I mean?

[Michael Batnik]

Like but if you filter by companies that are above a billion dollars, it's different. You're eliminating a lot of that risk. And if you, if you put together a basket of. But you should see my portfolio over the last year. You'd think I'm some kind of scientist or something.

[Josh Brown]

Like every other stock has lapsed.

[Michael Batnik]

I feel like Dave Chappelle. Yes. Sc. You know so. And then look at discretionary. Look at that base and discretionary. This is small cap discretionary. Looks great. And then look at small cap energy. Right. And then I want to dive into energy before we hop for the day. Okay so this is. I remember where I was in the summer of 2008. The last time energy was here.

[Josh Brown]

I know dude. This is like I can't imagine this not being the trade of 2026.

[Michael Batnik]

You and me were a beast bottle.

[Josh Brown]

This will not be on any magazine cover anytime soon.

[Michael Batnik]

I'm waiting for man. I'm waiting for it.

[Josh Brown]

Well, that'll be the end. That'll be.

[Michael Batnik]

We got an Iran economist today. Does that count?

[Josh Brown]

I can't imagine this not being the gold of 26.

[Michael Batnik]

Look at that base, bro.

[Josh Brown]

I know.

[Michael Batnik]

By the way, gold looks just like this before it broke out.

[Josh Brown]

I'm telling you, throw the next one. I'm telling you that I'm bowled up on oil and gas.

[Michael Batnik]

Here you go.

[Josh Brown]

Let me say. Yeah. So I'm long. This stock. Exxon.

[Michael Batnik]

Come on.

[Josh Brown]

It's going to. I mean, I just, I don't, I don't understand how it's not 150 already. I know. It moves slowly. Very big stock and moves slowly.

[Michael Batnik]

It's a big company.

[Josh Brown]

Okay.

[Michael Batnik]

Oil services. Look at it. Trying to get above those O2.

[Josh Brown]

I'm going to pitch you an oil service name in a minute. Okay.

[Michael Batnik]

All right.

[Josh Brown]

Yeah.

[Michael Batnik]

And then look at the relative ratio.

[Josh Brown]

Yeah.

[Michael Batnik]

Between XLE and the S&P 500.

[Josh Brown]

Yep.

[Michael Batnik]

Right. The. The energy versus tech. Looks very similar.

[JC Peretz]

Looks very good.

[Michael Batnik]

And then here's, here's one I like. I'm long this one. This is Solaris Energy.

[JC Peretz]

What do they do? I'm just.

[Michael Batnik]

I don't know.

[JC Peretz]

I'm just kidding. I know you don't know. Who cares?

[Michael Batnik]

Allegedly they're in the oil and gas space, but I don't know. Maybe it's a Ponzi scheme. I don't know. I have no idea. Why would I.

[Josh Brown]

Okay. All right.

[Michael Batnik]

I mean, they're doing something. Right. How many energy stocks do you know that look like this?

[Josh Brown]

Not a lot.

[Michael Batnik]

Right.

[Josh Brown]

The refiners look like that.

[Michael Batnik]

They look good. And then so this chart comes from Macro charts. Great. Shout out to macro. He's a great follow across the board. This. Who's Macro charts. Yeah, he's anonymous, but he's basically like the conciliatory to like, a bunch of, like, big hedge funds. Like, he's, he's the real deal. Okay, so this is a chart from him. This is the oil silver ratio going.

[Josh Brown]

Back to strong buy. Strong buy. Because people are talking about silver. Oh. Did you know that transistor chips require a certain amount of silver? Okay. So if that's why you're really bullish on silver, then you can buy oil here. That's, that's, that's. If that's like really the story.

[Michael Batnik]

I think this is an interesting way to look at things that if you're, if you're bullish of energy. This is a. What do you think?

[Josh Brown]

What do you think of this?

[JC Peretz]

I forgot to put this in the dock. So I grabbed one chart from Todd, our boy, Todd Sohn. Look at how hilarious this is. Todd said this one's for the DJs, it's the Pro shares, ultra short silver. So obviously this thing has been going vertically down.

[Josh Brown]

Yeah, crushed, right.

[JC Peretz]

It's crashing. But, but normally nobody buys this like there's no volume until people are trying to call the top desperately in silver.

[Michael Batnik]

Desperately, desperately.

[JC Peretz]

Like that's a dope chart.

[Michael Batnik]

Throw up the silver, I got a thing.

[Josh Brown]

God damn.

[Michael Batnik]

So this guy, this got a hundred dollar roll. Yeah, 100 roll written all over.

[Josh Brown]

I think that'll happen.

[Michael Batnik]

All right, so.

[Josh Brown]

And then what?

[Michael Batnik]

Let's play Perma Bear. All right, so what, okay, so what's going to change all this? What's going to change precious metals? What's going to change this massive international dollar breakout higher? So we came into the year looking for a break down in the dollar, right? Long Euro, long British pounds, long Swiss, long EM forex. And that worked out great. If the dollar last year, last year, if the dollar breaks out above a hundred, I think that that's a, I think that's a problem. And we're starting to see a few cracks. And not every crack needs to turn into a market crash, but every major.

[Josh Brown]

Bear market, I was going to say that could give you like the correction that or the, or the dip that hasn't happened yet.

[Michael Batnik]

Every crash, every correction starts with a crack or two. Here's a couple discretionary staples. Not making new highs with the S and P making new highs. The magnificent seven hitting new four month lows today on a relative basis. So if you're looking for a culprit for this particular cycle, that would be it. And then here's the Frankenstein, right? So it's the last chart. So this is the Frankenstein trade where the bonds have never been more dead, literally dead. And stocks like that. Right.

[Josh Brown]

We talked about this the other day. Vanguard put something out saying the right portfolio asset allocation for this year is 40 stocks, 60 treasuries. And I can't believe I can't remember ever hearing them say that. And I didn't even bother to track down what the rationale was. But just that idea that like somebody's even saying that is interesting to me.

[JC Peretz]

So that's weird.

[Josh Brown]

They're not looking at the charts. They obviously have another reason that they're.

[Michael Batnik]

Saying we're going into a midterm year. We're in a midterm year, the worst of the four year cycles. Even though technically that's what Vanguard's looking at technically when it's the second term, the cycle.

[JC Peretz]

Joe Davis, yeah, he's a midterm cycle. I'm kidding.

[Michael Batnik]

Year six, Year six for second term is not as bad. It's actually pretty good. But nevertheless midterm year historically not great. So one can argue what should we be looking out for for things changing. I think that that discretionary Staples ratio. I think tech underperforming rally, dollar rally and I think bonds waking up because if they're the. Look at how boring bonds have been.

[Josh Brown]

Over the last years. Dollar rally. Forget about the implications for stocks. That's really bad for people that are chasing silver here.

[Michael Batnik]

I think it's bad for international stock investors. I think it's bad for silver, precious metals, rocks in general of any kind, whether it be of the precious or base variety.

[JC Peretz]

Can we go back to the previous chart?

[Michael Batnik]

Yeah.

[JC Peretz]

So I think this is really interesting. The app, the Max 7 one. I think up until now people were waiting for like the dot com divergence where you see the rest of the market and only the Mag 7 are the ones that are left standing. And then of course we know what happens next. It would be interesting if it's the reverse of time, if the leaders go first and now they pass the baton to the rest of the market and it's like a sort of fake handoff and then they all come tumbling down together. Maybe that would catch every. That would catch me offsides. I mean that'd be interesting.

[Michael Batnik]

If the dollar's above a hundred, I think that's a big problem. If you start to see volatility pick up in the bond market, that's a big problem. You know generally the trend is up for stocks. Like we want to be buying stocks, we want to be buying breakouts. And I don't necessarily think it's a binary outcome where like oh, everything's going to get crushed. I think this is going to be a K shaped market. Look what I see what I did there. Come on, come on. That's pretty, pretty good, huh? Very good. So I think that rather than 2025, everything went up. Some went up more than others. I think we could be very high likelihood that in 2026 we can have huge winners, huge losers and some that kind of just trade flat. I think that would be a very high likelihood.

[JC Peretz]

That's what AI is doing. I agree.

[Josh Brown]

I think most investors be okay with that as long as they think they're going to be the ones that are in the ones that work.

[JC Peretz]

Be selfish. Right? Be selfish.

[Josh Brown]

Hey, what a tour de force. Ladies and gentlemen, J.C. peretz.

[Michael Batnik]

What I'm saying.

[Josh Brown]

Thank you. And we will include a link in the description. So People can check out your slides, Draza. Slides from stock market centers.

[Michael Batnik]

We did, we went out, we did hours. I mean, Josh and Batnik and myself, we could be here all night. But they got things to do. I got nothing to do. They got things to do.

[Josh Brown]

Do you have your brokerage account open and logged in?

[Michael Batnik]

No.

[Josh Brown]

All right, I'm gonna pitch you some stocks. You might want to buy a couple of them.

[Michael Batnik]

Oh, I'm gonna talk to my wife. Josh.

[Josh Brown]

No, I'm not pitching you, but I just want to get your take on these. Sean and I keep a list of best stocks in the market. You know what we're looking for. The general idea is we buy strength. We're not looking. We're not looking for reversals and pieces of shit. We're not bottom fishing.

[Michael Batnik]

Is that on the fact sheet?

[Josh Brown]

Yeah. We're not storytelling, we're not listening to conference calls. It's not that we don't care, it's that that's not the selection criteria. Okay, so might have a personal interest in learning why a stock is going up, but it doesn't start there. Okay. I want to show you a couple and just hear what you think. It doesn't really matter what I think of the technicals themselves. Morgan Stanley's been on best stocks, the market list, I think consistently since the summer. It's probably been a good seven, eight months. And it is just. The move today is obviously earnings driven. So let's assume a little bit of this. Today's move fades. This is as good of an uptrend as I've seen in this stock since I started doing this 30 years ago.

[JC Peretz]

So you normally don't see stocks like consistently for that long of a period of time sitting above the 50 day.

[Josh Brown]

Look how well. Look how well behaved. Look how well behaved this is. And it's not that there haven't been like rough weeks, but like this. This stock has given no one any reason to sell it whatsoever if they're just focused on price. What are your thoughts?

[Michael Batnik]

I mean, financials in general have been a monster, right? European financials, Japanese financial, US Money center banks, all of them just absolutely ripping. So it's more about the group that it's in and less about the stock itself.

[Josh Brown]

I agree. These don't, these don't really separate that much from each other. Large cap, US Financials, they tend to do what they're all doing. I agree with that for the most part.

[Michael Batnik]

Yeah, I mean, you know, this one's not your favorite. It's not that it's not my favorite. It's that they're all kind of like this, right? Where like they're extended, you know, look at bank of New York Mellon. Absolutely ripping. Look at all these European banks. I mean, the trend is up. And for me it's less about trading Morgan Stanley and more about thinking about the implications, you know, if these financials are up, not just in the United States, but globally. Like I'm old school. Like I came up in the 2000s, I was there for the great financial crisis. We don't have bull markets in America without financials. And in the rest of the world, it's even more egregious when you look at the holdings of the companies in those indexes.

[Josh Brown]

So like I look at an MSJC and I just, in my mind, well, how do they make money? They have everything in their favor. There are IPOs, there's M& A. The FTC isn't saying no to anything unless Trump wants to get something for himself out of it. So there's deals all over the place. You could bring companies public. Asset management revenues are ripping because asset prices are at record highs. They make money as a, as a Treasury bond dealer. I think during that business net interest, margin spread, businesses like proprietary trading, fixed income, commodities, currencies, there's nothing they don't make money from. There's nothing that they're involved in that's not doing well right now. And I would say one, I would.

[Michael Batnik]

Say 189 is a big number there. Big lot of, lot of market memory there.

[Josh Brown]

Going back, you know, John G.S.

[Michael Batnik]

To the great financial crisis highs. So if we start falling back below 189 and kind of holding below there, that could start to turn into a problem. But if you're above 189, I mean, this another 50% higher. Why not?

[Josh Brown]

Basically the same chart, Goldman Sachs.

[Michael Batnik]

Yeah.

[Josh Brown]

Morgan Stanley's been an easier ride. You've had some trend line violations here along the way. I just think that's the nature of it being a higher baited name than Morgan Stanley, at least these days. But like, huge winner. Same trade, Same trade. Okay, I'm with you.

[Warren Buffett]

All right.

[Josh Brown]

I grouped these together.

[Michael Batnik]

Yeah. The trend, the trends are not, are not down.

[Josh Brown]

Here's a question. Next, next, Next chart. You can't buy this with a straight face, right?

[Michael Batnik]

Why?

[Josh Brown]

I don't know. I can't. So this kla, this has been on the best stocks in the market list for a while. We wrote it up a few months back. It's been like a massive home Run. This is. Because this is, this is parabolic to me. What do you think? You can't, you can't buy this stock.

[JC Peretz]

No, I cannot.

[Josh Brown]

No way. Does the presence of a gap like that bother you?

[JC Peretz]

No, that's a baby gap.

[Josh Brown]

Would it stop you from that? That would not be the thing that would stop you from, from pushing by, on, on a KLA.

[Michael Batnik]

No, I'm looking at like 15 and a quarter. If we're above 15 and a quarter, I think you're fine. You know, that gap is just evidence of, you know, relentless buying pressure. People are like, oh jc, it's overbought. It's like, well, how could an overwhelming amount of buying pressure possibly be a bad thing? I don't know. I don't know.

[Josh Brown]

This is reacting to Taiwan semis news today. That's right. Gap today.

[JC Peretz]

It can be a bad, it can be a bad thing in the. But who cares?

[Michael Batnik]

Semiconductors are making all time highs on a relative basis. So the fact that you're putting up a semiconductor stock that's making a new high, like it better be.

[Josh Brown]

Yeah, yeah, no, I agree with that next one. Here's another one. We've, we've been, we've been writing about this one all year. Lam Research lrcx. Not as parabolic as kla, but basically the same, the same chart.

[Michael Batnik]

Yeah. I mean like what do you want me to tell you? I mean it's a bull market.

[Josh Brown]

The question is can you hit buy on a new trade in, in this stock today or you would not do that?

[Michael Batnik]

I mean I wouldn't today because that's not how I trade. It doesn't mean that it can't go higher. Like 236 is a big one here. You know this goes back to the dot com bubble highs. 236 is a big one. So if you could.

[Josh Brown]

You're looking at 25 year charts right now. Yeah, all of these, all of these stocks were like also part of the original dot com bubble.

[Michael Batnik]

Me and Leonardo Fibonacci. The PISA are getting down right now on this laptop. You know what I'm saying?

[Josh Brown]

Okay.

[Michael Batnik]

You know, 236 is the big one. 381 is next. So if it could stick that 236. Yeah, it could keep going higher. But you know, expect volatility. I mean this thing's going to be down 10% in two days.

[Josh Brown]

For no reason.

[Michael Batnik]

For no reason. It's just going to happen in a week easy.

[Josh Brown]

You know, and it'll shake out. The type of people who bought today without even thinking about it.

[Michael Batnik]

That's right.

[Josh Brown]

All right, Next group. Here's CBRE. In 45 minutes, I'm going to go pitch this with Sean at the New York Stock Exchange. I'm not going to tell you the fundamental story. It's commercial real estate, which everyone obviously hates and thinks is a worthless asset class. And this stock doesn't give a shit what anyone thinks. And I love these types of setups where they're consolidating below resistance for a while and knocking on the door meter. And I just. To me, this is so obviously going to break through. It is the blue chip of the space. It's an asset light business in commercial real estate, which is an asset heavy sector. And they were to treat it like a tech stock because they've transformed the whole business from brokerage transactional commissions to an ARR model.

[JC Peretz]

Can I tell you something?

[Josh Brown]

And the street loves these stories.

[JC Peretz]

I'm buying the stock today. How about that? You just convinced me. I love this chart.

[Josh Brown]

Like it?

[Michael Batnik]

Yeah, I like it. 185 is coming.

[JC Peretz]

I'm buying this right now.

[Michael Batnik]

All right, 185. And then after that, I'm not front.

[Josh Brown]

Running the CNBC pro people because I wrote it up this morning in the column 260.

[Michael Batnik]

260 after 185.

[Warren Buffett]

All right.

[Josh Brown]

I don't own it yet. I might pull the trigger too. First Solar. I don't know what to do with this. This stock's been on the best stocks in the market list. It still is.

[JC Peretz]

These stocks are so hard.

[Josh Brown]

So for me, these are so hard to figure out where to enter, where to exit. But I this. Think about it. If we're. While we're on the subject of 25.

[JC Peretz]

Year charts, no solar stocks ever.

[Josh Brown]

Like no solar stocks ever because you lost money in enphase. No, but that wasn't good though.

[JC Peretz]

No. Dude, bro, this chart, these. Dude, bro, dude, if you're going to.

[Michael Batnik]

Do solar, you got to do Chinese solo. Like you're either going to go full.

[Josh Brown]

Or tan or tan the etf.

[JC Peretz]

You ever make money, Jason, you ever make money in solar stocks?

[Michael Batnik]

Yes, and I've lost money, too. I mean, I've traded everything over the years, but check out array.

[Josh Brown]

But what are you. What is the technical read? Somebody shows you this chart on a, on a trading desk. What's your answer to them? There's nothing here.

[Michael Batnik]

It's a mess.

[Josh Brown]

It's a mess, right?

[Michael Batnik]

Yeah, it's messy. I like array better.

[Josh Brown]

So I can't bring myself to write this one because it just looks, looks weird. All right, I have one more pair.

[JC Peretz]

Wait, hang on. What does CBRE do before I buy it? I don't care.

[Josh Brown]

Great. One more pair of stocks. Oil services. This is Baker Hughes. I love this break. I love this breakout.

[JC Peretz]

I want to buy this too.

[Josh Brown]

Look at the, look at the long term on Baker Hughes. This seems like pretty momentous. Above 50. Can't this go to 100 bucks?

[Michael Batnik]

I mean, are they still counting rigs?

[Josh Brown]

Do you forget about all that?

[Michael Batnik]

Do you know that it's a thing that they do?

[Josh Brown]

Crude hasn't even rallied yet and this stock is breaking out. When crude goes, this stock really goes.

[Michael Batnik]

Baker Hughes and not like Halliburton.

[Josh Brown]

Well, that's my next chart. So. So Halle Berry here, here's how. Here's Halliburton. Halliburton's already, already gone.

[Michael Batnik]

And the slumb burger.

[Josh Brown]

That's enough. That's also on my list.

[Michael Batnik]

Go to this restaurant and order the slumb burger. No pickles.

[Josh Brown]

Do you like this? Bet you like this Halliburton better than Baker Hughes.

[Michael Batnik]

I mean, I think I like energy. I'm long energy. I'm getting more long energy. You know, oil services, you know, pick which one you like. They're probably going to move together higher. Beta is going to move more. You know, if you want to get junky, go offshore drill or something like that. But like, you know, if you want to get in energy, you can get an energy. And there's a few ways to get the juice. You can either go down the cap scale and buy some junkier stuff or you can be in the derivatives market with the bigger names. You know, I think either way, I.

[Josh Brown]

Think the services names could all rip this year with a tiny bit of help from crude.

[Michael Batnik]

Nobody owns them, but you need a.

[Josh Brown]

Much bigger move in crude in order for like the oil producers to make that kind of move. I think the services can just go because they're going to go.

[Michael Batnik]

And the refiners have been going, but.

[Josh Brown]

And they already broke.

[Michael Batnik]

Americans just. Americans don't own it. And I think that there's a squeeze to be had there, right? Because if everybody owns something, it's probably a little too late. The fact that The NASDAQ is 0% energy. S&Ps are 2% energy. Dow is 2% energy. How much less energy could these things be?

[Josh Brown]

Nobody owns it.

[Michael Batnik]

Nobody's gone.

[Josh Brown]

Last question. Totally off topic. I just was curious to get your thoughts on it. I forgot to text you. Can prediction markets be analyzed by technicians?

[Michael Batnik]

They're Just so illiquid.

[Josh Brown]

Let's say they were more liquid. Let's say they became more popular, and there was higher contract volume. Could you look at a yes no chart for any subject and determine buyers versus sellers or levels at the end of the.

[Michael Batnik]

It's not levels at the end of the day. What are we doing as technical analysts, as technicians? We're analyzing.

[JC Peretz]

What are we doing?

[Michael Batnik]

Oh, we're analyzing the behavior of the market.

[Josh Brown]

This kid's literally trading.

[JC Peretz]

I told you I was buying it. I'm in cbra.

[Michael Batnik]

We're looking at the behavior of the market and market participants. So if these prediction markets didn't suck so much and they weren't just a bunch of glorified penny stocks, at least the penny stock people tell you that they're penny stocks. These people are like, oh, it's the prediction markets. No, you're gambling like an idiot. Right? Like idiots gamble.

[Josh Brown]

Oh, so you're not a fan?

[Michael Batnik]

No, it's not that I'm a fan. Is that they're nothing. It's an irrelevant penny stocks scam. Like, it's not anything, you know?

[Josh Brown]

Thomas Peter Fee came on Halftime Report last week and wanted to debate me. Founder of Interactive Brokers. Brilliant, brilliant man. Great man.

[Michael Batnik]

Yeah.

[Josh Brown]

He wanted to debate me. It turns out we didn't really disagree. He had made a statement that he thinks prediction markets will become larger than the securities market.

[Michael Batnik]

Yeah, I heard that. I said, multiple people have said that.

[Josh Brown]

I said, I don't think so. Not because there's no merit to prediction markets. I think the binary nature of them. People will lose money and lose interest very quickly.

[Michael Batnik]

Do you remember binary options?

[Josh Brown]

Well, yeah, I mean, is.

[Michael Batnik]

Is rebranding that. That was a scam and a lot of people lost money and people went to prison.

[Josh Brown]

What was the binary options thing?

[Michael Batnik]

What exactly.

[Josh Brown]

I, I totally forgot. I remember the term, but I forgot what people were trading.

[Michael Batnik]

You know, everybody's in.

[Josh Brown]

They're buying up down on a stock.

[Michael Batnik]

Everybody's every. It's. It's the outcome. It was a binary outcome, and that was what the option was. And then they canceled all that because people were trying to manipulate.

[JC Peretz]

No, I don't. But Josh's point is they're going to.

[Michael Batnik]

Say that about the prediction market. Remember the prediction market?

[JC Peretz]

No, it's not going away. But people don't. I. People do not. Like all or nothing outcomes. Because with the stock, if you're wrong, you could take your. I'll take. I'll.

[Josh Brown]

I'm an investor now. As a trader now.

[JC Peretz]

And no no, my max loss is 8%. And that's it with the prediction outcomes for the most part. Not for the most part, unless you're buying, selling, like unless you're trading them. You're right or you're wrong. You make money, you lose money.

[Michael Batnik]

There's no assets, so there's no liquidity. There's nothing there. It's a fugazi. Like look at the stock market.

[JC Peretz]

It's positive.

[Michael Batnik]

$70 trillion in the stock market and.

[JC Peretz]

The pie is growing.

[Michael Batnik]

There's like a couple of hundred million dollars. Why all the prediction markets combined?

[JC Peretz]

Well, they just started, so why does.

[Josh Brown]

He think it's irrelevant? But I. Interactive Brokers launched. Obviously every other brokerage launched prediction markets. So I understand, like being promotional about it. I wonder and I wish I got to ask him, but it's TV. So I had like 20 seconds. I wonder why he thinks that binary bets are going to become a bigger market than the securities markets, which includes bonds. Why would that happen?

[Michael Batnik]

First of all, the CEO of Kalsha said the same thing. But the point is, is that of course.

[Josh Brown]

Right, of course he did.

[Michael Batnik]

If you're the CEO of a company, your job is not. And I don't know it. I don't know this guy that you said you were going to fight or whatever. I don't know any of these people.

[Josh Brown]

He owns 90% of the equity of Interactive Brokers.

[Michael Batnik]

I'm sure he looks his kids. My point is, is that that's not the point. The CEO of a company is their job is to make money for shareholders. Right? So if going on TV and telling the whole world that this penny stock market is going to be bigger than the entire stock market, that's what his job is like. Even if it's like the dumbest thing in the world.

[JC Peretz]

He's helping his shareholders as he guess. Right? What's a better business? Commission free trading or taking a rake in the prediction markets?

[Josh Brown]

Way better. I think it's interesting that Robin Hood is all in prediction markets.

[JC Peretz]

Said it too.

[Josh Brown]

Vlad super horny predictions. Never been hornier. He told us here on the show. And then Schwab's like, nah, we're not, we're not doing that.

[Michael Batnik]

It's a fade all day. Yeah, it's the latest. It's like the latest gimmick that like people that can't stay focused and they're chasing the next shiny thing. I told those are the types of people that are chasing.

[JC Peretz]

I said, vlad, I think everybody's drunk on this stuff. Like I don't think it's going away. I think it's going to grow, but it is. The way that we're talking about it is so insane, in my opinion.

[Josh Brown]

I think it'll be very, very niche. I think it'll be very niche and it'll be a lot of fun to watch, like, people bet on things and watch the election stuff especially. I can't imagine it becoming like a gigantic market. I just. Maybe I'm an idiot and will laugh at me in three years. I think I'm more on your side.

[Michael Batnik]

For the record, I hope that you and I are idiots and we're dead wrong, because that would be cool. But these are glorified penny stocks with no liquidity. And if you are gambling on these things instead of actually owning assets, I think, in my humble opinion, that you're a king moron. Right? And anybody who's telling you to bet instead of invest, don't hold that.

[Josh Brown]

Don't hold back. Say what you really feel. All right, ladies. And I'm wrong. Ladies and gentlemen, thank you for. Thank you for joining us on this edition of the Compound and Friends. I would like to give a huge thanks to our friend JC Peretz. JC's research can be found at trend labs dot com. JC personally can be followed on x dot com it's x dot com jcperretzx we have to work on that. It's no good. We gotta fix that. All right. And you're on LinkedIn. J.C. peretz, CMT, as in charge market technician. Anywhere else, people should be going, onlyfans, right? Onlyfans, yeah.

[Michael Batnik]

And follow me on the polymarket.com. i got my profile in there.

[Josh Brown]

That's right. And if you're anywhere within the vicinity of the national championship game on Monday, you will probably be able to hear JC cheering for the U.

[Michael Batnik]

There's other loud, obnoxious Cubans there, by the way. I know I'm not the only one.

[Josh Brown]

All right, guys, thank you so much for listening. Thanks for watching. We'll see you soon. All right. That was cute. That was amazing.