Did the Market Just Top? (EP. 434)

25:20So they're saying, listen, most of the Gen Z people who are boxed out of the stock market or the housing market are using those down payments to invest in the stock market. As we have been saying, so the numbers now bear this out. there's way more young people invested in the stock market and there's way more low-income people invested in the stock market. Both fantastic leaps forward in household wealth, right? This is very good news. You mentioned earlier how good we are at producing these giant corporations. One of the side effects of those giant corporations is wealth inequality. And it is a real issue and it is a political issue and it is a societal issue.

26:01Obviously, the way that these rich people can impact the conversation, the elections, it sucks. And I think we all agree it sucks. But there is the other side of it, which is the rising tide lifts all boats, not every boat. But somebody had a good email on this topic. They said, I don't think wealth inequality matters. I don't think wealth inequality matters. Okay. Do they really mean that? I would think it doesn't matter. All right, whatever. They said, or maybe I'm misquoting that. I don't think wealth inequality matters. Okay. But the absolute level of wealth for the bottom X percent does. If Elon Musk sold all of his stock, withdrew all of it in cash, and set it on fire, inequality would go down.

26:44But it wouldn't make anyone's life better. Conversely, if Elon's wealth goes up by$10 billion tomorrow, it makes no one else's life any worse because we are not in a zero-sum game economy. Wealth inequality will never be better than it is today. oh i wrote this wait did he write this um i'm sorry this is a horrible red email one of the worst put this in the louvre wealth inequality will never be better than it is today because the compound interest sure a bear market will make it better but who gets hurt worse in a real bad bad recession elon or the bottom 10 that sounds like him not me um fair points in there are you arguing with yourself and chad i don't know i don't even know did i make this up did i write this did i write this myself here's the great thing about the corporations you can now invest in the entire, all the corporations for pennies on the dollar in an ETF or a mutual fund or whatever, and own these corporations and take part in their profits with their growth.

27:37That's, that's the beauty of this stock market. It's a miracle. And it's funny. People don't make a lot of money, have the ability to invest in multi-trillion dollar corporations and all their growth and earnings. It's amazing. We could literally own NVIDIA. And for all the, for all the hoopla for private mark over alternas, which we're going to get to later. I'm in the penalty box. How many times have I said, which we're going to get to later in the show? Then there's my third time, but why would you want it all? Why would you want an alternative to Apple or Amazon or Nvidia? That's a good, that's a good question.

28:05How, what, what percentage of investors can pronounce Nvidia correctly? I think most do. Sometimes you still get the Nvidia, but I'd say most are. Yes. When you catch one of those, it's like Chipotle, when people can't say Chipotle. Chipotle. I went to Chipotle today. It grinds my gears. Did I say that I went to a Chipotle recently? And I think my ball is 1265. Are they back? You did say that. You said you're back. Deflation. Stock looks okay. I feel like the stock might be bottoming this piece of garbage. Where are we next, Ben? We've been jumping around. You got this one. You said fiscal stimulus was a hell of a drug.

28:45Now, we're not going to fix wealth inequality, but the baby fund stuff is great news. It's great stuff. and it really is, you got to be in the investor class, right? That's it. And no, I think nobody likes the K-shaped economy. Like obviously we, we, we wish for more people participating in the upside of the economy and the way to do it, it's through assets because the people that are investors have so much money because of the bull market. Yeah. And that money is going to keep growing because those people don't, aren't forced sellers. Most of the, most of those people who have the assets are not forced sellers.

29:21So anyway, this is why Robert Kiyosaki is not going to be right about baby boomers being homeless. The ones who own all the stocks are they're not just because of bear market hits does not mean they're going to be forced to sell their assets. By the way, we didn't even read the rest of the tweet, which is whatever we'll put on the show notes if you really care. But like it was it was crazy. That's what I mean. Buy silver and Ethereum because everything's going to crash. What do you think is going to happen to Ethan in a global depression? Good question. What's this flows one? Because this treasury bill ETFs have the biggest flows this year.

29:55There was a lot of throat clear. My point was there was so much money in the system that the year-to-date category ETF flows, the top four, it's not everything we're talking about. It's treasury bill ETFs. Okay, crypto isn't there. It's precious metals. It's the value factor and it's thematic funds. I would have never guessed T-bills are the top category ETFs. In a million years, I never would have guessed that. By a lot. All right. It is funny, the value stuff. So we have a talker book coming out next week with Victory Shares, and they have these value momentum ETFs. And we talked about how momentum has been outperforming by a wide margin over the value factor.

30:37But there's way, way more money in value. And look at it. I can't believe it. So value is the fourth biggest. People cannot quit value investing. Money just keeps flowing in there regardless. How much? $36 billion. Where was momentum? 12. So yeah, check this out. All right, this is weird. Not sure what to make of this exactly from Deutsche Bank via the daily chart book, which is just a go-to every day, all day. The key story for September was not rising positioning, but booming fund inflows, not not just into equities,$122 billion, but also bonds,$98 billion. Indeed, the combined inflow in September was the largest monthly inflow since early 2021.

31:25So the bond thing is, I still think baby boomers repositioning and rebalancing. Yeah, that's explainable. It's just so much money. Everyone has money. All right, let's get crazy. Also from Todd. He has the ETF asset class launches as a percentage of the total on a rolling six-month period. I don't know if it's an underappreciated story in the stock market, but if you're not online and really into it, you might be missing the plot here. The leverage and the de-gen economy, as Linsen calls it, just continues to plow ahead. So over the last six months, one out of every four new ETFs involves using leverage.

32:13People really want this stuff, huh? See, this is why people need a slap on the wrist. Like this kind of stuff getting out of control is like, this is why we need a little more than a Friday flush eventually. And it sounds like crypto. I'll do it with you and we're going to talk about that soon. I think that this is, it's such a small piece of the market, even though the numbers are gigantic in terms of the market caps of a lot of these companies and the call options are, like on a relative basis, does it matter? No, I guess not. But it's an interesting trend that there's just way more leverage in the system.

32:51And there's a lot of people who, like Corey Hofstein has been pounding the table on this for a while. Like there's ways to use leverage very intelligently, right? And obviously a lot of people, most people aren't probably, they are being degenerates with this, but people are obviously more comfortable with it and they want this stuff. Otherwise there wouldn't be all these new ETFs. All right, I want to talk about, one of the beautiful things about markets. Like, you can still, I've talked about this with Bitcoin before. Almost everything that Bitcoin and crypto people have told us have predicted about the world and what will happen has been wrong, but they all stayed long and they still made money.

33:24And I think a similar thing is happening with gold, okay? Everything the gold bug said would happen. The dollar is going to crash and the Fed is going to ruin everything and the financial system is going under. Everything they said was wrong for most of them. And they're still being wrong about why gold is going up right now, which we'll get to in a minute. But they stayed long and they made money. Gold's up 50 % this year. So I showed this chart last week on S &P Compound. Do you see this one? It's gold and S &P by decade. And in every other decade, one has been up really big and the other one's been down.

33:59The relative spread has been wide. The 2020s are the first decade in modern economic history that gold and stocks are both booming at the same time. Never happened before. it's kind of surprising right yeah it's good it's good stuff um but then all these people i i tweeted this and some guy said um measured in gold not dollar terms isn't the s &p down 16 or something since 2020 and then i see then i see a chart from bloomberg denominated in gold equities have been falling since 2000 uh a chart from goldmark truck ounces of gold to buy a new house, median new single family home priced in gold is now at all time lows.

34:38This is the dumbest thing I've ever, this is so dumb. You cannot, you cannot price speculative assets and speculative assets. What if we price gold in S &P 500 points? Guess what? Gold is not up 50 % in S &P 500. This is the dumbest thing I've ever heard. People stop this. This is dumb. Price gold in Oclo. What are we doing here? Exactly. Gold's crashing when you're pricing it in Oclo. I just, like, listen, take the win. If you own gold, you're long, you've made a ton of money. But the reason gold is going up is not because of fiat dollars or something. Someone tweeted the other day that, like, gold makes up like 3 % of the world's, like, currencies or whatever.

35:19People just take it too far. Like, central banks are buying a lot of gold. That's the thing. Central banks are buying gold. That's why it's going up. And there is. That's it. There is uncertainty, political uncertainty, economic uncertainty, dollar uncertainty that is leading gold higher, but you don't have to then price the S &P in gold, right? Like you're most like the, a lot of the thesis has, is it's not, it's not all wrong. A lot of it has played out, but then you go crazy when you're pricing, why not price cattle in gold? I mean, what do we get? Yes. Just take the win. Take the win. You don't have to make it crazier.

35:53If you want to sell your S &P 500 index fund and take that money to the bank, you're going to get dollars. Like your bank will take dollars. You could pay your mortgage with dollars. You can't pay your mortgage with gold. You're pricing dollars because that's the unit of economics. You don't go to your local brewery and say, here's a gold coin, sir. Yeah. Fill my beer mug. Wait, what do you mean? My gold coin used to buy me three beers and now my gold coin only buys me one beer. What's going on here? And the bartender is going to go, I don't care. Get out of here, weirdo. It's bizarre. It's bizarre.

36:22This is also bizarre. We've spoken a lot about like measuring sentiment and having conflicting reports, which is why I think like a lot of the work that JC and his crew do about like building a composite sentiment, reading is the best way to do it. I don't know what's in here exactly, but Goldman Sachs Global Investment Research has a US equity sentiment indicator. Now, again, I don't know exactly how they're measuring it, But like, based on this, it looks like nothing to see here. I mean, if anything, people are like not excited at all. If it's based on surveys, then let's throw it out the window because then it doesn't matter anymore.

37:05I've said sentiment is broken. The vibes are broken forever. That's my case. All right. Eric Soda at Spilled Coffee has a good one about the cash on the sidelines fallacy. Did you see any of this? So this is one from Charles Schwab and it shows. we've made this chart in the past have we? okay, but this is the whole thing about all the money, I think the 0 % interest rates in the 2010s kind of broke people's brains on money markets because no money was going in there at all for the whole 2010s, because rates were zero but he shows it as a total net assets as a percentage of the S &P and then there's not so much cash on the sidelines because stocks are going up, so cash should be moving with it, and then US money market funds as a percentage of S &P as well his whole thing is saying, yes, there's seven or eight trillion dollars in money market funds but if you look at it with where the stock market is that actually makes sense because the percentage is actually going down because stocks are going up so if you hold cash constant it's not like that money's all of a sudden going to come rushing in and i think we mentioned a couple weeks ago like if a richer society there should be more cash on hand it makes sense yeah so it makes more sense than people are saying and you were credit to you you were early on now and saying that this money's not coming out of money market funds.

38:16That's staying put. I think you're right. Is this next chart from Dan Greenhouse the same thing? Yes. Yeah, that was in his piece as well. Alright. Here's a good one for you. Households have a dollar in cash for every dollar of debt, the most deleveraged since the early 1990s. This is from Bank of America. Households are still in good shape and have the ability to borrow even more money if and when the next downturn hits. I continue to believe that. That whatever downturn is, unless the AI bubble totally inflates to like epic proportions and then it just pops. But even the dot-com bubble popped in the 2001 recession was very mild.

38:54Extremely mild. It helped that we had a housing bubble to prop people back up, but that's probably what'll happen this time again. We'll probably get a housing boom the next time the economy slows. Anyway, I think whatever happens, as long as it's not some crazy exogenous shock, households will be able to weather it by borrowing more money. You know what's coming around the corner, Ben? We got earnings season, which is my favorite season because as I keep pounding the table on, I care a lot more about what companies have to say than what journalists have to say. A lot more. Companies have no reason to - That's your new tagline.

39:30Listen to the companies, not the investors, right? I'm not going to say they're not going to lie to you because there's some companies that do some shenanigans, of course. But on balance, companies are not incentivized to not tell you the truth. Now, again, sometimes they cover stuff up is what it is, but they're not going to paint a rosy scenario in the aggregate when the facts don't warrant that. But this is like it is. This is also why as someone who's a long term person, a lot of people email me and ask for my thoughts on the should if if we shouldn't have them report quarterly anymore because I'm a more long term person.

40:05But I actually totally disagree with that idea. I think we need to have them report quarterly because I think opening it out longer opens up the possibility of shenanigans. Me too. I think that's my problem with that idea. Anyway. What's this chart from, oh, the Delta stuff? I didn't put this in here. Okay. I listened to the Delta call this morning and a few things in there stood out. Delta is now 60 % of the industry's profits. Kind of wild. They're killing it. I mean, they're by far the best airline. It's not even close, right? Not even close. I only fly Delta if I can. The last time that I do too.

40:44And I have one of the platinum Delta credit cards and it's the only one I fly usually. And I was on a flight with my kids. Where were we? I can't remember. The last time we flew as a family and the flight attendant came up to me and I felt kind of like George Clooney up in the air. And they said, hi, Mr. Carlson. Just want to thank you for being a Delta platinum, blah, blah, blah, blah, blah. And being so loyal to us as a, my kids are like what was that about are you like a celebrity so they thank me for being a loyal member austin not to brag the flight attendant came up and shook my hand and said he's a big fan so i've i forgot his name but if you're listening thank you sir that made me feel pretty good he sneak you a free drink uh i've been drinking on flights okay credit to me because i who doesn't love drinking on flights getting a drink on it i feel like what percentage of people in first class get a drink when you get 80 %?

41:41I almost always do, but I haven't been doing it because, you know, busy. Responsibility. Responsibility, growing up. What else was, wait, hold on one sec. There was, they also said that corporate travel is all the way back, higher than 2019 levels. See, that's the one I never would have thought. When people were predicting how the pandemic is going to change the world forever, I would have said, yeah, with Zoom meetings and such, corporate travel is never going to get back to the same levels. Same. All right. So this chart shows. I think that there's some people in some businesses that just, they like the face-to-face interaction, but they just, I think some people just love that lifestyle.

42:19Being on the road, right? Being on the road. The guys in the, in the polo shirts and the jeans and the boots, right? Those guys have to be on the road, drinking their Miller lights at the bar and, you know, talking about the Astros or something. So the premium cabin revenue is about to pass. main cabin, which is pretty wild. And Glenn Hauenstein, who's the president said, um, I've equated it to this. The car that you drive today, is it better than the first car you had? The answer is probably yes. And you don't see many people going back to cars that are worse. Once people get used to traveling in a certain product, whether it's comfort plus Delta premium select or whatever, they tend to not go back.

42:55Their retention rates are in the mid eighties there. So yeah, that's true. They didn't, they didn't have comfort plus and stuff in the past. That's a relatively new thing. Luxuries become necessities. But I'm sure that they're also able to jack the prices up on those and people will still pay them. People who have more money, right? Yeah. I'm guessing that's part of it. Yeah. It's like the IMAX experience. Somebody emailed us about going to Disney and they said that Disney's charging 200 bucks to meet Santa or something like that. Listen, people will pay it, whatever it is. But I did say to my wife, we're not doing the meet and greet with the characters this time.

43:29What a piece of shit sham that was. You get this crappy buffet. No, we're really not. We're really not. That's it. You get this crappy buffet for$130 a head. That is one of the worst things about Disney. The food is awful. I don't think they care, really. But the food is not good at Disney, right? No, not great. Also, my wife got after me a little because I said I didn't want to go to Disney on a podcast a couple weeks ago. Apparently, she still listens to the show occasionally. Are you going? I stand by my take. Yeah, we're going on Thanksgiving. Every week she calls me, hey, you want to do this at Disney?

44:04I'm like, I don't know. You take care of it. Wait, Thanksgiving at Disney? That's a great idea. Yeah, we thought so. Let's talk gambling. This is a great tweet from DallyBally2. So on Friday, as the market was having a not so great afternoon, was Aquila positive on the day? I think it was. Yeah, it was. This guy tweeted, I was wrong. Oclo is the perfect stock. No revenue. No product. Hence, no exposure to anything. If I'm being honest, I have no idea what Oclo does. They're trying to build a nuclear energy something something. I think that's what they're doing. All right. So this was making the rounds.

44:48The Goldman Sachs basket breakdown of the year-to-date performance, and they also break it down by the April 8th to today. all right drone stocks are up 370 percent quantum computing stocks are up 315 percent memes are up 123 non-profitable tech is up 111 percent most short are up 98 so retail is kicking the shit out of professionals and i gotta say like using all degenerate themes for the most part i'm not mad i i you know i'm not wagging my finger yeah i think i think most most people understand that like um you don't think there's a lot of hedge funds in these trades now too? Probably. The smart ones.

45:29The smart ones are. All the momentum traders are in these stocks. And you know what? People get wrecked. They get wrecked. This is the market, right? Like no crying in the casino. And also if I was a younger man, I'd be balls deep in these names. Come on now. Okay. I wouldn't, but I know you wouldn't. Good for people who are. Yeah. All right. So last week, I believe last week I said, or maybe two weeks ago, I said, the market is cruel. Like even if we know that a lot of these names, and I guess we can't know, but even if we strongly suspect minus 900 that the odds are against most of these companies sustaining their valuation it doesn't mean that the shorts are going to make money it's just not that easy so credit to this guy imagine wanting to short this stuff and like get in front of that train and time it perfectly no way i mean i can imagine it if you really understand the businesses here and you genuinely know that these are pieces of shit now i don't know that but if you are one of these people that have domain expertise.

46:25Yeah, but using a fundamental thesis in a mania is, come on. No, no. The timing is all that matters there. I get it. 100 % right. Anyway, my point is, I want to shout out this one guy. Credit to this guy. At Common Sense Play tweeted, I'm closing my short on Ionic and Rigetti. Market makes no sense. They will drop 90%, but taking the L on this trade. That's a pro move. Yeah. Good on him for admitting it, right? Yeah. The market, the market just, it just won't let you make money this way. And maybe the lungs will get liquidated, but the shorts definitely will too. That's just the way it goes. All right.

47:01Let's talk about crypto. I am a tourist here, but it sounds like on Friday, people were like brought out in body bags with crypto. And it's weird because Bitcoin was down, I don't know, five to 10 % Ethereum. It wasn't like a huge crash. Hold on. Hold on. The Ethereum and Solana were down at one point, I think each more than 20%. the altcoins fell. Some of them fell like 90%. That's what it sounds like. It was the altcoins and stuff. But it says the biggest crypto liquidation ever from CoinDesk amid market chaos. And they talked about all this stuff and people were trying to figure out and they say it was 20 billion, but it was probably way higher than that because of finance and all this stuff.

47:37And a lot of people were pointing to this old post from Brian Armstrong from Coinbase at the beginning of September. He said, we just bumped up the max leverage from 20 times to 50 times on international perpetual futures. A bunch of traders asked us for this update. let us know what else we can add. I don't know if that was the reason, but it sounds like a lot of people were just extremely over levered and it didn't take much of a fall. Yeah, that was the reason. It was leverage. So it was just an insane amount of leverage and people got taken out and bought it. Again, it just, there was literally one down day in the stock market and it evaporated crypto.

48:07But I guess, and a lot of people are saying a lot of these altcoins like literally went to zero. Yeah. But it is wild that Bitcoin had 110 ,000. I mean, it's still a healthy, healthy, healthy number. And yet, look at the chart from Wall Street Journal. They show the total liquidations on crypto derivative exchanges. It makes the FTX, I mean, you can't even see it. This was 19 billion, FTX was two. So there must have just been an insane, insane amount of leverage in the system. And this is a good thing. No one, you talk about no crying in the casino. No one should feel sorry for these people. But it sounds like people were up millions and millions of dollars and probably lost millions.

48:45Okay, you could simultaneously feel bad for people. Like it sucks that this happens while all like just being a human being. Like, I'm sorry that happened to you while also saying, what did you think was going to happen? Come on. Yeah, exactly. Right? Like if you, if you make millions of dollars going 50 times leverage, you can go to zero on the same thing. I think that's just. Could you imagine being, I, I, I'm not laughing because it's not funny. Um, being one of those people that got wiped out from the Trump tweet and then 24 hours later, Trump says, don't worry, it's all good with China. We're going to make it, you know, it's going to be fine.

49:21I mean. Yep. Taco Sunday. I, um, I don't know. It's the whole thing Warren Buffett said before, you don't want to get rich twice. If you got rich once and you made five or ten million bucks in crypto, I don't know, cash some of it out. Hopefully there are people that saw this, younger people, because it's always younger people. You know, eventually you do this long enough and you get burned. Hopefully young people saw this and said, okay, maybe I should But it's insane to me that people were able to put 20, 30, 40, 50 times leverage on and make that much money. And at that point, it's just a game.

49:54It's not even real life. Well, you know what? Somebody tweeted, long-term capital management was using, I think, 25 times leverage. And they got wiped out doing fixed income arbitrage. Right. They're talking basis points. You're using 50x leverage on crypto? I mean, come on. Use your head. All right. Let's talk private markets for a second. BlackRock reported this morning, I think they brought in$8 billion in private credit. It was the largest private asset, private investment gatherer that they reported. Lots of demand. So they had a report a week ago, today's private credit opportunity. And I think I'm on the record.

50:36At least I'll go on the record. I don't think private credit is a bubble. I don't think that first brand's blowup is indicative of everything. I'm sure that there are, you know, that it's not the only one, but I don't think it's like a systemic, all private credit is a fraud. It's going to blow up the system. I just don't buy that. As the space gets bigger, there's going to be more blowups. Like there has to be because it's casting a wider net and there's more businesses and there's more loans. And of course, so the stories about private credit are going to be amplified because people have been warning about it.

51:03Yep, no doubt. And there's a lot of journalists that are dying for this, dying for this to be a juicy, salacious story. And the first brands one is, And I'm going to talk about it tonight with Josh, but this chart made me laugh. Private credit assets offer a unique correlation to the public markets. And they show the correlation of the prequin private credit versus the Bloomberg ag. And they show it at negative 0.02. Come on. How is this negatively? If you don't report the NAV, correlation is zero. How is this negatively correlated to bonds? What are you talking about? Well, it's essentially a zero correlation, meaning like there's, yeah, that's a...

51:44Oh, by the way, I think I said this last week on the show. I tried bottom fishing in the Aries Private Credit BDC, and I got stopped at for 5 % loss because I'm not that brave, but I think I should be back. I think I'm going to get back in. I don't believe that this is going to be like the unwind of the century. Okay. Good luck with that. My whole thing is just, I think people need to just temper their expectations with private credit. The returns have to go down. But even if they go down, let's say returns go down 20 % and they go from 11 or 12 to 8 or 9. Is that the worst thing in the world?

52:22No, I think that's probably my base case if I had to guess what's going to happen. Yeah, returns are going to be compressed because more money coming in and that's the story of capitalism. All right, this is a great chart. So we've mentioned this data point. 90 % of companies in the US that generate$100 million are privately held. Right? I've never seen it put this way. Kind of a face blower here. I would have thought that like the 90 or the 80, 20 rule applies. That even though most of the companies are private, you still have more revenues with public companies because NVIDIA and Walmart, you know?

52:54No, not true. $40 trillion in annual revenue for private companies in the US. Damn, that's a lot of money. And$35 trillion for public companies. So that includes like all small businesses. So like my tailor at the mall right next to my office, Sue Alterations, small business. I'm sorry, hold on, I'm sorry. That includes that? This is the US, the EU, and the UK. Okay. It's still surprising. Right? I feel like that private number has to be very hard to get though. How do you come up with those numbers? I'm sure there's a way to back into it. Anyway. Yeah, you're right. That's surprising. All right, Bloomberg has a great piece on what I think is called house rich.

53:38America is minting lots of cash-strapped millionaires. So they say millionaires are on the rise, but much of their wealth is in hard-to-reach assets. This is funny. In the Gilded Age, there were 4 ,047 millionaires in the U.S., and each one is listed by name in a special edition of the New York Tribune. Can you imagine that? Like they listed just all the millionaires because that's how, in the paper. Today, the millionaire households, more than 24 million, one in five U.S. households, and a third of those modern millionaires have been minted since 2017. But they're saying it's mostly... in houses, right?

54:11For the barely millionaires, people with a million to 2 million, 66 % of their wealth is tied up in their primary home or retirement accounts, meaning it's illiquid. They can't access it. Households with 5 million or more had 24 % and easy to access bank or mortgage accounts compared to 17 % for those closer to the millionaire mark. So basically, it's saying a lot of people have a million dollars, but they're probably house rich, retirement account rich, and they can't really, it's not liquid net worth, to which I mean, play the world's smallest violin for these people, obviously. You're still a millionaire, but obviously that makes sense since housing is up so much.

54:44There's probably a lot of house-rich millionaires. And housing really is one of the hardest assets to unlock, the wealth, right? You have to borrow against it for a HELOC or cash out refinance if you want to take some of it out or sell, and then you have to live somewhere. So you have to either downsize or buy a place that's just as expensive, potentially. It is the hardest one to actually unlock the wealth. anyway being house rich first world problems but that's the thing yeah house rich millionaires right um they said gen x added the most millionaire household this is funny um they look look at all these increases in millionaires gen x added a ton millennials added almost like three million millionaires this is since 2017 so a huge leap forward right um but then they show being a millionaire isn't the same as it used to be and they show the cost of a four-bedroom home in the New York suburbs, driving two Mercedes E350 sedans, which I don't know what that is, which those are a four-year Harvard education for two children and a two-bedroom upstate New York cottage and a 19-foot Seabray boat.

55:45They show the difference in the cost. I'm sorry. This is not being a millionaire. This is being like a deca-millionaire or. Yeah, what? So you own a house and you own two Mercedes and you send your children to Harvard and you own a two-bedroom cottage in upstate New York and a boat. Dude, this is what, this is the thing. this is the news that they're giving us because we were outraged, right? We're outraged. This is, this makes people mad because it's nonsense. It's pure bullshit. Right. This is the top, I don't know, 5%, 3%, 2%. Yeah. This is not, this is not a thing that just being a millionaire did not used to, never Mercedes, a vacation house, a C-Ray, Harvard.

56:25Right. Sorry. That's not being a millionaire, right? That's, that's being in the top. That's like top 1%. Yes, exactly. All right. There was a long article. And that's why even rich people are a millionaire. Because they look at that and they go, I'm rich, why am I not doing this stuff? Because that's very few people do that. There was a long article in the journal about how not great Hollywood is doing. They said at the end of 2024, 100 ,000 people were employed in the motion picture industry in LA. Two years earlier, it was 142 ,000. 30 % fewer movies and TV shows with budgets of at least$40 million began shooting in the US in 2024 than in 2022.

57:06This is surprising to me because there's so many more streaming networks now. I would have thought it would have risen for sure. And yet, Hollywood still seems so not great at giving the audience what they want. Like, for example, Tron opened over the weekend and it bombed. I'm not surprised. It cost$180 million to make. It did$33 million at the box office over the weekend. My son wants to see that really bad. He watched both the first two Trons. He did. Okay, fine. So George is an outlier, but I should be a consultant. This is so easy for an outsider. Now, easy in the cheap seats. No one wanted that one.

57:48Michael, are you going to see Tron? Nope. And nobody else is either. Good. Done. That should have been a straight to Disney plus streaming movie. Tron is not a... this is not IP that anybody gives a shit about. Give people more weapons and sinners. Like get the memo. It's over. You will be going on the Tron ride at Disney though. Mark my words. Supposedly they could have a good Tron ride. But the problem is, the problem is when these things bomb, Scott Mendelsohn was writing about this. They blame, the audience doesn't want to see movies. No, we do want to see, we want to see good movies. We want to see this shit.

58:28Right. Again, that should be a straight to Disney Plus movie. Like they should have more of those as opposed to trying to being in a theater with that. Absolute junk. I got a lot of emails last week about spending less time on your phone. And a lot of it was like delete the app. It's come on, guys. I don't have the app. I think I'm that big with Dodo. What I do is I go on through the internet. See, that's even worse than the app. Um, but I did, somebody did send me something. That's an addict move right there. To go on through the internet. But I only go on through the drugs now. It's like hiding the drugs in your ceiling or something.

59:04I bought something called a brick. I haven't used it yet. But I think what this thing is, is I think it like restricts websites. So you have to like physically hold your phone to the device to unlock it. So I'm, I'm going to literally cut my phone off. From Twitter. You know what I finally did? And again, I was thinking about this week because I have to reflect on the show last week. I really am only on it during my downtime. But the problem is my downtime is when I should be with my kids. So I'm on the couch at like seven o 'clock or seven 30 scrolling Twitter when they're like, you know, on their iPad or whatever.

59:37It's horrible. It's like the worst thing ever. You know what I did that helped me a lot on Twitter? And obviously to your point, willpower alone is not enough. In these instances, you need to have, I don't have willpower. Like I, like one of the things I still use it for is I'm catching up on sports, college football or NFL because I'm out and about doing stuff all Saturday and Sunday with my kids and I'm watching highlights. But then you have the auto video feed and it goes from like a sports highlight to like two dudes fighting in an alley. And it's like, I don't need to see this. So you can turn off the auto video play.

1:00:04So it just, it loops your video. So it doesn't show you these other insane videos that you don't want to see. You get caught on the loop. That's helped me stay off of Twitter more. Like I'm just watching it for sports highlights and nothing else. Oh, you do have willpower. I don't need to be off Twitter completely. I just need to be off it from like the hours of six to 10. Cause during the day out, whatever. All right. Anyway, you're too busy to, yeah, you're too busy to do it during the day. All right. Here's a good one. Talking about like the news and what we see and what causes all of the anxiety.

1:00:32Max Roser showed. Oh, this is a good chart. It was great. All right. What Americans die from and the causes of death, the media, the U S media specifically reports on. So for example, heart disease and cancer are the number one and number two killers. They're over, they're almost 60 % of deaths, almost 60%. And yet they are 6 % of coverage at the times, the post and Fox news, give or take 60 % of deaths and only 6 % of coverage. On the other hand, the biggest by far because it's salacious is homicide 42, 46, and 52 % on the networks. It is kind of crazy the causes of death homicide you can barely even see on the chart.

1:01:22Where does it, what is it, is that 1 %? I can't read it, it's so small. Terrorism, 18, 12, and 11, and that. I mean, to be fair the news networks, it would be kind of weird if they're like Jerry Smith died of a heart attack today at age 73. He was 250 pounds and. 100%. drug overdose. But you're right. This is a very good put it in context kind of thing. Even on like local news, and even like Good Morning America that Robin watches, it's always just like, oh my God. It's like weather, yes, I can't. Death hit by car. It is. It's too much. I pretty much just, avoiding cable news has been probably better for my mental health than even Twitter.

1:02:03I stay away from it at all costs. I want to give a shout out to our colleague, Tata Siskanta, celebrated his 20th anniversary at Abnormal Returns, which is absolutely amazing. The best curator in all of finance. I still, like, every Sunday, he does the top 10 posts of the week. He has personal finance posts. He has an advisor newsletter. Every day, he's putting out the best links from everything. Like, if you, people ask me, like, how do you have a filter in place to read the best stuff and stay up on this stuff? And I said, whatever you do, just read Abnormal Returns every day because he doesn't miss anything.

1:02:38congrats tata that is impressive wow 20 20 years of doing anything is amazing but think about how many people that we when we started blogging back in like the early to mid 2010s there was all these other people who had blogs think about how many of them have fallen by the wayside and just stopped doing their blogs and like the fact like survival is a big key big piece of it just keep doing it um all right recommendations i will start you got me going on um audible books and now i'm hooked and it's got me to the point where I don't listen to podcasts. I'm like, why do I need this stupid pop culture sports podcast?

1:03:09So I listened to Breakneck by Dan Wang. He's been on a podcast. Yes. Wait, I put this in here. Oh, you did? No, I put this in here. Did you listen to it too? Dude, it's so f***ing good. Okay, it's very good. Wait, look at us. Look at us. How old are we? We're listening to the same audio book and we don't even know it. I listened to it in a week. I finished it. I just thought his whole thing about when he first said the lawyers versus engineers thing, I felt like, oh, that's clever. It's cute. But he really like point by point kind of broke it down. Like, okay. So that was, wait, hold on. Just, just for the audience, because you're right.

1:03:45That hits so hard. Explain what he meant by that. So the whole idea is that the United States is run by lawyers, right? Almost all the politicians, like two thirds of them went to Yale law school or Harvard law school. And all of our politicians are lawyers and they put rules in place to make things like protect people and make sure things don't happen. Yeah. You can't do anything. And yeah, Yeah, you can't get anything done. China is run by engineers. They build stuff. And I thought the greatest thing about this book is that I thought he did a wonderful job of looking at the cost and benefit of the pros and cons of each system.

1:04:13And he looked at the great things China can do and how they can build stuff, these bridges and like the infrastructure and everything is clean, all these parks. And it's amazing. But they have like, they seem to lack common sense. I think that was what he was getting at. And a bit of humanity. Yes. And I thought that, I don't think enough, maybe in the 80s and 90s, they talk about this more. I don't think enough has been made about how batshit crazy the one child policy was. Like, are you kidding me? And the fact that I didn't realize they literally have a department called the propaganda department.

1:04:42I thought he was joking, but that's literally the name of a department. So anyway, so did you come away reading that book or listening to it feeling better or worse about like us versus China in the years ahead? Because I don't, I still. I mean, I'm not done with the book, but I feel like I've, I'm in it enough that I can conclude that it's going to be tough to beat them. those people are they seem to they can build stuff like if we went to war with them their production they would probably crush us unfortunately but I feel like they have a very they have a lot of blind spots we do too obviously but I feel like they have a lack of common sense we can learn a lot from each other yes I think that was the point that like there's but we're mere images of each other kind of like the fact that like we need us and they need we need us and they need, I can't say it.

1:05:33We both need each other. And because they like to build so much and manufacturing is such a big part of it. Like that, the fact that we're consumers, like we're kind of a yin and a yang with each other. Yeah. It's a very, very good book. It's the best. And I'm admittedly a macro tourist on China, but man, it was a good book. Yeah, it's really, really good. That was the best book I've listened to in a long time or read, whatever. Yeah, no. Can you say you're reading the book if you're listening to an audible? They're tough. They're a tough competitor. I don't know. What else? I'm listening to a book.

1:06:00I know it sounds weird to say, but listen, I think you've come to terms with where we are in life. It's so funny. I got to show. Yeah, it's very good. I listened to the whole thing in a week. I got to show. The Lowdown on Hulu with Ethan Hawke. It's a good, not a great show, but they basically just said, Ethan Hawke, we're going to let you cook. And he's like way out there. He's doing all sorts of Ethan Hawke things. He plays an investigative journalist who gets caught up in this crazy scheme and mystery. And it's not like a prestige kind of show. It's a little silly at times, but if you're an Ethan Hawke fan, that's all that matters.

1:06:40It's just Ethan Hawke cooking. I get Ethan Hawke and Jude Law confused. The names, not Left Faces. I'm not sure why, but... They both kind of came up with the same. You've seen Gattaca with both of them in there, right? I've never seen Gattaca. I know you like that movie. Oh, really? You have to watch. That's a fantastic movie. Okay. I really, I enjoyed the shit out of Black Rabbit. I finally wrapped it up. I really enjoyed it. Yeah. But it's just a lot of bad stuff happens, right? Yeah, I think I thrive on misery for my entertainment purposes. And we're one episode away from finishing Task, and that show has gotten better as it's gone along.

1:07:13The last two episodes of Task have been fantastic. Okay. I'm a little bit behind there. I'm going to catch up. Speaking of misery, somebody said, how come I've never done a favorite horror movie list? I'll do it next week for the Halloween season. but I'm going to I thought you did this before have I? I can't remember I'm going to but I'm going to exclude like Halloween and Scream I'm going to do stuff that's a little bit more off the beaten path well that is what you do yeah how about this I have a theory though I think horror movies are the new superhero movies I think Hollywood Hollywood is getting lazy and all they do is do these horror movies at a low budget I think that's the new like eh let's just another horror movie but you're late though because that trend has been in place for the last five years And I think it's finally peaking because a 24, not a 24.

1:08:01Oh my God. Who's the dude? Oh, uh, was it Jason Blum who was on Bellini's podcast a couple of months ago? Oh, Megan too. Bombed. Okay. I just, I just want more comedies. I don't know why we don't have comedies anymore. It's really depressing that we don't have more comedy movies. It's like, no one wants to laugh. I don't get why there's not more comedy. They don't make money. That's it. I can't imagine that people won't want to go see good comedies again. There's a new one coming out with Seth Rogen and Keanu Reeves and Aziz Ansari. And it looks hilarious. It looks dumb, but very funny. I can't wait.

1:08:34I just want more dumb, funny movies again. That's what I grew up on in the 80s and 90s and 2000s. What happened? Hollywood was letting me down. All right. So we mentioned Breakneck, which was a very easy listen. Because my speed was like four to five hours. It's a 280-page. What speed do you go? you go well it depends if i'm in the shower i slow down to one times because it's hard to hear but if i'm on the move i am 1.7 okay i'm at a two now okay i'm comfortable with a two and i just every time i take i take my dog for a walk every day you know and put him in on that and listen to it and i can't believe how quickly it's you're able to get through a book i listen to the whole thing in a week all right um on the flip side though this book took me two weeks i listened to I've always wanted to read this book, Team of Rivals, by Doris Kearns Goodwin, one of the best historian authors ever.

1:09:26My dad is like the biggest Lincoln fan ever. He's read all the books, and that's his favorite one. You know, it's funny. As I'm cleaning out, unpacking my office, this was in a box. I bought The Time, The Time, an illustrated history of his life and times. Abraham Lincoln. Obviously, I never thumped this. It's a huge magazine. But I will. But anyway, I listened to the book. The kind of person who just doesn't exist anymore, right? No. It was too long. I mean, it was tough. It took me, I mean, that took me like 20 hours, I think. It took me two weeks to listen to. I'm glad I listened to it because I never in a million years would have read it.

1:10:04But on the flight home, I mentioned last week that it's been a while since I saw a movie on an airplane. I said, you know what? I want to watch Lincoln. See what Daniel Day-Lewis is all about. All this Daniel Day-Lewis hullabaloo. Hullabaloo. and it's not streaming. You have to like pay for it, which I would have done, whatever. But it was on Delta. So I watched Lincoln. Perfect airplane movie because it's a slow drama and you're not going to watch it. I remember not, it's kind of a tough watch. It wasn't that great, I didn't think. Exactly. You're not going to watch it on your couch because it's boring.

1:10:38But in the airplane, especially after reading Team Arrivals and having all these characters being brought to life, holy shit, Daniel Day-Lewis. I mean, hot take, he's good. He won Best Actor that year. It was a great performance, not a great movie. You're not going to watch this at home, but I really enjoyed it given the context of the book. Did I learn anything? Yeah. Am I going to forget it all in about a week? Probably. Biographers, just cut 50 % of the junk you put in your books, right? A lot of it's just unnecessary. A lot of fat, as usual. All right. A lot of fat on the show, you might say.

1:11:13We went an hour 15. Read some bad emails. I didn't talk about AI at all. You were the only one who brought it up today. It was pretty light. Pretty light. What else is going on, Ben? Anything else? That's about it. Thanks to the production team, as always. idontshop.com. Do you have any new hats in yet or not? Oh, I don't know. Okay. Animal Spirits at the compoundnews.com. We'll see you next time.

1:11:46Bye.