In short
Animal Spirits Podcast - Episode 371: How to Pick the Winners
Episode Overview In this episode, hosts Michael Batnick and Ben Carlson discuss various topics related to investing, market trends, and personal anecdotes. They explore the current state of small-cap stocks, bond investments, consumer behavior, and even delve into the cultural context behind the Olympic games. The episode touches on several financial concepts and market observations, making it a mix of education and casual conversation.
Key Topics Discussed
- Small Cap Stocks
- Current cheap valuations of small cap stocks and the reasons behind their historical underperformance compared to large caps.
- The cyclical nature of small cap versus large cap performance.
- Potential tailwinds for small caps due to their current valuation.
- Investing Strategies
- Discussion of a study from Vanguard about owning a larger number of stocks to increase the likelihood of outperforming the market.
- Insight into how a portfolio of 500 stocks has a higher probability of outperforming compared to a portfolio with fewer stocks (e.g., 1 to 30 stocks).
- Market Trends
- Surge in investor interest toward bond funds and ETFs as interest rates rise, with $150 billion being invested in U.S. fixed income ETFs in 2024.
- Observations on the 60-40 investment strategy and the improved safety margins with current bond yields.
- Consumer Behavior and Economic Reports
- Analysis of American wages in comparison to other countries, revealing surprising data about income levels across various states in the U.S.
- Good news regarding average gas prices aligning with historical trends.
- Housing Market Insights
- Future prospects for the housing market as mortgage rates ease and existing home sales hit lows not seen since 1995.
- Discussion on the implications of generational wealth transfer and the impact of tax policies on housing inventory.
- Cultural Commentary
- Personal anecdotes about the Olympic games, the influence of social media, and the current role of platforms like Twitter under Elon Musk's ownership.
- The hosts share humorous exchanges about personal life, summer vacations, and the evolution of entertainment.
Key Takeaways
- Investing in Small Caps: Small caps might be undervalued currently, presenting potential investment opportunities.
- Diversification Matters: Holding a more extensive and diversified stock portfolio enhances the chances of outperforming the market.
- Bond Investment Surge: Increasing interest in bonds indicates a shift in investor sentiment, likely driven by risk management strategies in a fluctuating interest rate environment.
- Economic Strength: Despite popular beliefs, many U.S. states have wages that exceed those in developed countries like Germany and Canada.
- Housing Dynamics: The housing market remains under pressure, and demographic trends will play a crucial role in future shifts.
Cultural References
- Olympics: The hosts discuss their differing views on Olympic viewership and the cultural significance of the games in society.
- Movie References: The conversation includes nostalgic references to films and shows, highlighting their personal connections to cultural moments.
Conclusion This episode of the Animal Spirits Podcast balances market insights with personal stories and cultural commentary, making it relatable for listeners interested in both investing and everyday life. The hosts emphasize the importance of diversification in investing while also acknowledging the societal narratives influencing the economy and market behaviors.
Listeners are encouraged to explore investing strategies while keeping an eye on broader economic trends and cultural shifts.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Transcript
Automatic transcript. May contain errors.0:00On today's Animal Spirits, we talk about Michael's old DVD book. Thoughts? Not bad. It's a lot of movies. The best type of potatoes. French fries. The polarization of Elon Musk and Twitter. We also discuss what people mean when they predict the end of the world but say, I hope I'm wrong. And also, I give a pretty big dig at Michael for not watching the Olympics. Stay tuned. today's animal spirits is brought to you by our friends at y charts they have a bunch of good free content at y charts we have a linkedin newsletter i've been more active on linkedin lately posting there lately remember josh told us hey get on linkedin and we said get out of here and we did me too and i have something to say about twitter later later in the show that's a teaser okay so check out the y charts advisor pulse which is what do you get updates on the market.
0:56So the most recent one, they showed that three stocks contributed to 49 % of the S &P 500 gain in the first half of 2024. Can you guess what those three stocks are? Besides NVIDIA, that's an easy one. Apple and Microsoft? Google and Microsoft. Close enough. They also had our own Nick Majulian, an update about how stocks perform in the election years. That was good. I think White Shirts also teased. We'll give a little teaser here. They're going to come out with another book of politics and investing and how politics impacts the market that we'll be using in any weeks and months ahead. Also, if you're attending Future Proof, YCharts has a booth there.
1:33Check out their twos and data. Give it a test run. It's pretty cool. Check out the YCharts Advisor Pulse. There'll be a link in the show notes. Remember, if you do not have a subscription to YCharts yet, tell them Animal Spirit sent you 20 % off when you first sign up. Balance your trading strategy by adding futures. CME Group helps you manage risk and capture opportunities in all market environments. Capitalize on around-the-clock access to highly liquid global futures and options markets across all major asset classes. And with CME Group's e-mini and micro-sized futures and options, you can diversify your portfolio and manage your exposure in equity indices, interest rates, crypto, metals, FX, and energy.
2:09These smaller-sized contracts offer access to the same transparency and liquidity of the benchmark contracts with less upfront financial commitment. Access valuable education materials and trading tools and learn more about what adding features can do for you at cmegroup.com slash animalspirits. Derivatives are not suitable for all investors and involve the risk of losing more than the amount originally deposited and any profit you might have made. This communication is not a recommendation or offer to buy, sell, or retain any specific investment or service.
2:44Welcome to Animal Spirits, a show about markets, life, and investing. Join Michael Batnick and Ben Carlson as they talk about what they're reading, writing, and watching. All opinions expressed by Michael and Ben are solely their own opinion and do not reflect the opinion of Ritholtz Wealth 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.
3:14Welcome to Animal Spirits with Michael and Ben. Ben, how is your summer going? By the time this episode comes out, it'll be August, the dreaded final month of summer. Are you trying to have small talk with me? I don't get it. I am. When do your kids go back to school? August 21st, which seems very, very early to me. I want to be an after Labor Day guy. I don't want school to take over my summer. Yeah, I know it's regional. Our kids don't go back until the first week of September. Yeah, that'd be fine for me. We're going back early. They're taking away like a week and a half of summer for me. My wife will be happy because the kids go back to school and she's been just filling their time with camps and stuff to do.
3:51But I want summer to keep going. I hate to say it, but summer's over. At least we're getting there. I was just talking with some of the fellas. We do one Giants game a year, and we're already booking the Giants game out in October. It has me thinking. So got to enjoy summer while we still have it. It's not quite over, but it's basically over. Talk about a filler small talk thing. Man, summer went by quick, didn't it? That's something people say. Tell me about it. Tell me about it. All right, before we get to the meat of the show, we are looking for a full stack engineer. We've got something cooking in the hopper.
4:24If that is you, if you could do that job, I can't do the job. I don't even know. What does full stack mean? Front end, back end, design, develop, engineer. Are they half stack engineers? Just like there are junior gold miners? Is there a half-sec engineer? I'm sure there are, front end only. Email us, animalspirits at the compoundnews.com. All right. All right, good one from Michael Semblist. We've been talking about small caps lately because they've been doing really well. He has his eye on the market called the Lion in Winter. And there's some sort of analogy there that he shared on his podcast, but I thought this was really good charts.
5:00So first of all, He shows the three-year rolling over and underperformance of small caps versus large caps. And you can see it's cyclical. Makes sense. But his point was, listen, there's a reason for this cycle happened for a reason. Small caps didn't underperform just for no reason. It's because large caps had higher earnings growth. They had better free cash flow margins. And all throughout. And he also showed that it's not just tech that did well. Small cap tech didn't do that well. It's just large cap tech that did well. That was an interesting chart. He showed large cap outperformed small cap in every sector, except for maybe one, going back to 2010.
5:38Yes, which was interesting. And it wasn't like small cap tech did very well. And he shows that the thing is, as much as small caps underperformed large cap stocks, international stocks have done even worse. Small caps have done okay. It's just they haven't done as well as large caps. So his point is now, listen, small cap valuations look pretty juicy historically. Like they, they're looking pretty good. And the whole point is they're cheap, but they're cheap for a reason. And now you have to guess, like, does that cheapness give it a tailwind? And does it, the expensiveness of large caps a headwind?
6:10That's the trillion dollar question, I suppose. The gap between small cap stocks and large cap, the NASDAQ 100, whatever, that's like, the gap was huge. And it basically is almost all the way shut for a year to date performance. Kind of wild. That happened pretty quickly. I mean, we've had these head fakes along the way for the past 10 years or so where something else will do well. International stocks had an 18-month window. Small cap stocks did. It's just can't it actually sustain? That's something we haven't seen yet. All right. So we talked a lot about the Besson binder studies last week. And I heard from some people at Vanguard who wrote a piece about this a few years ago and said, how do you actually increase the odds of owning those stocks that drive the returns?
6:54Okay. Moliers, please. Okay. It's interesting. So they did all these simulations. They looked at portfolios from one stock to 500 stocks out of the Russell 3000. Wait, are we about to learn how to pick the winners? Well, just how to increase your odds of owning them. All right. Listen up. Pay attention. If you're dozing, pay attention. It seems obvious, but I think that this is kind of an important point. So they look at, again, so the Russell 3000 University did all these different scenario portfolio simulations, Monte Carlo, and they did 1, 5, 10, 15, 30, 50, 100, 200, or 500 stocks. and the probability of outperforming the benchmark is the highest if you own 500 stocks out of 3 ,000 as opposed to one, five, 10.
7:34So the probability goes up the more stocks you own. God, that's lame. What? It makes, so, but think about it. So the way to beat the index is to closet index? That is one way to look at it. Obviously, you can outperform more if you have a concentrated portfolio. But the whole point is that the concentrated portfolio just puts you at way more risk. So - Poppycock, I say this, just pick the winners. you'll be fine. But it is kind of a thing. Like, this is why closet indexing exists, because it works. Like, if you want to be, remember Peter Lynch? Peter Lynch owned like thousands of stocks. I would invert that statement.
8:08Closet indexing works because if you don't closet index, the odds of you severely underperforming increase by a lot. Yes, this may seem obvious, but it, I don't know. I think it's important to note, though. Like, if your universe is the S &P, you probably shouldn't own 30 stocks. You should probably own 300. This is like, I don't know who said it's better to fail conventionally, right? Yeah, but I'm saying if you want to increase your odds, it makes sense. To your point, I knew you were going to be the closet next thing. So here's how you pick the winner. Next time, I'm going to want you to set a reminder for me.
8:39Next time Netflix falls 70%, just tell me to buy it, please. I did. I literally did tell you. Okay. Did I not say it here on the show? So I pulled this up after we talked about it last week or two weeks ago or whatever. And so going back to the history of Netflix, which is, I think it went public in 2002. ish, 2001, something like that. It's had 63%, 74%, 82%, and then 74%. And it came all the way back each time, obviously. 32 % per year all time, 26 % per year for the past 10 years. And that includes a 74 % drawdown. Pretty amazing. What was with the 2012 crash? I don't think I remember the cause of that.
9:19Oh, yes, I do. That was the, that was, they were canceling their, the DVD thing. They canceled the DVD business. Right. Which I was a member of. I was a proud card-carrying member of the DVD business. It's funny that the market didn't like that. Right. Remember, they were going to split up into two companies, one DVD and one streaming. But in hindsight, killing the DVD business, of course, there was the right decision. But at the time, the market punished them. Interesting. I forgot about that. It makes sense. So one of my big things for the past, I'd say 10, 15 years, is just that investors are becoming better.
9:52the behavior is getting better for investors. It's not perfect. There are still dummies out there who buy high and sell low. But on aggregate, people are getting better as investors. And Wall Street Journal has an article that investors embrace bond funds before rates start to fall. And they said that a ton of money is poured into bond funds. U.S. listed fixed income ETFs have taken in$150 billion through July, a record through this point in a year. When looking at mutual funds and ETFs together, taxable bond funds were responsible for nearly 90 % of the net U.S. fund inflows in the first half, which is a wild number.
10:27Ton of money going into bonds. And I don't know how much of this is people trying to, hey, rates are higher, the short end's going to fall if the Fed cuts, or it's just boomers getting defensive and saying, I've got huge gains in my stock portfolio. No, no, no, no, no. No, it's the first thing you mentioned. That's clearly what it is. Trying to time it? It's almost like the, I mean, bond yields It's not, you're not like timing it. Like it's happening. The rate cuts aren't going to happen. Right. Yes. And the Fed has given you ample. I mean, obviously bond rates, yields have fallen a little bit, but they show the yield on the Bloomberg ag, which got as low as 1 % or so in the pandemic.
11:03And it wasn't that high going into the pandemic either. It was, you know, less than 3 % for a long time. And it got as high as almost 6 % when rates went up. But now it's still 4.8%, I think, as of the last part of this chart. still pretty good. So, I mean, everyone, you know, because we have to do this, said 60-40 portfolio is dead in 2022 because bonds and stocks both fell. But bonds are going to give a better ride through the next downturn or recession or whatever it is, or just rates falling, right? Yeah. There's way more margin of safety now. That's not like a prediction. That's math. Right.
11:40So I looked at the asset center management for the ag, which is$112 billion. So scroll down a little bit. And I did the chart before of stocks versus bonds, and the ag is flat for the last five years. No return. Plus, you've got a 20 % drawdown. But look at the assets. It fell a little bit in 2022, but in 2023 ever since, those assets have skyrocketed. $75 billion at the beginning of 2023 to$112 billion now. There's a ton of money going into fixed income. And I think this behavior makes sense. People probably, it's rebalancing. Well, you know why? You know why? Not to pat ourselves on the back, but a lot of this is advisor-driven.
12:20Yes, it is. In fact, basically all of it. Probably. Yes. That is true. One of the big reasons for behavior getting better is people taking their hands off the steering wheel and say, I have an advisor do this for me. Yeah. Okay, this is kind of wild. Balchun has tweeted, VOO has broken the all-time annual inflow record for an ETF. Jeff, VOO is Vanguard's S &P 500 index fund. $50 billion, and it's July. Wow. I don't get it. Where is this money coming from? That's a good question. Like, honestly. So this broke a record, plus we're seeing record flows into bonds, but money market funds are still$6 trillion-ish.
13:08So what's happening? Everyone's rich, man. If you own financial assets, you're rich right now. Yeah, I know, I know, I know, I know. But like literally, where is it coming from? Deposits? So how about this? Baby boomers retiring and they are... Selling businesses and buying index funds? No, they're rolling over their 401ks and they're putting their money into Vanguard funds. Okay. Is that part of it? Yeah, I buy that. And that's a wave that's going to happen for a while. So that's actually another way that investors are going to become better behaved because there's a lot of crappy 401k plans out there with terrible funds in them.
13:46We see this all the time where a 401k plan - Can we just give a plug? Yeah. Dan LaRosa was on Asset Compound last week. Dan LaRosa runs our 401k business here at Ritholds Wealth Management. He's very good at it. If you have a 401k at work or if you're a business owner and you might want a refresh or a look over or a, hey, am I doing this right? Reach out. We get questions all the time. hey, our HR has us in this crappy 401k plan because their brother-in-law told them about it. And most of the time, HR is not doing this maliciously. They just don't know any better. And so sometimes you need some help on your 401k plan.
14:27Great chart from Tom Sarapagus. The tweet is this from Eric Balchunas. Eating too much Boomer candy can lead to decaying ETF returns. Did we talk about the Boomer Candy story on here? That Boomer Candy is just funds with high yields? Yeah. Well, that was our talker book with JP Morgan we talked about. So they showed the percentage of equity ETFs that are beating the S &P 500 ranked by yield. And what it's showing is that, and this should surprise nobody, but it's still very interesting. The higher the yield, the less likely that you're beating the S &P 500. and maybe not a fair comparison because I think by definition, a lot of these stocks, a lot of these, I'm sorry, a lot of these ETFs are by definition capping the upside, but it's a reminder.
15:19High yield does not always mean highest returns. In fact, it almost goes the opposite way. In fact, it does go the opposite way. I only was, no hedges here. No, maybe. The higher the yield, the less likely you are to beat an index of stocks, Whether or not that's the right bogey, just saying. I think that this is also environment dependent too, because dividend stocks are more high quality, blue chip names, they've been left behind. So during the next recession, it'll probably flip. 100%. 100%. But yes. And the thing is, back to the behavior thing, a lot of the people who own those higher yielding funds or stocks are probably okay owning them because that yield makes them feel good about themselves.
16:00Right? It's the guarantee in the box like a Tommy boy. I could take a shit in the box and slap a guarantee on it. There you go. Okay. I had ChartKid Matt updates for me just because it's interesting. And it's the kind of chart that just – I was looking for surprising charts this week for some reason. I was like – I haven't seen this updated in a while. You and I have both written blog posts about this. If you inflation adjust the price of gold, it's been below the 1980 peak forever. And I thought, well, gold's making new highs, and we've had inflation, So I wonder where we are now. It's getting there, but still technically below the peak.
16:36Inflation adjusted, which is surprising to me. The funny thing, and this is fun with numbers in a lot of ways, because I looked the other day, if you go from 2000, when the S &P and NASDAQ peaked, basically the start of 2000, gold is crushing them this century. Right. So it is kind of a change of start and end date kind of thing, but surprising nonetheless, correct? It is surprising, caveats aside, that going back 45 years, give or take, gold has had a real return of zero. Now - Doesn't your brain want you to say that it's only been 30 years since 1980? Like, wait a minute, it's that long? Did you see Elizabeth Berkley put on Instagram the video of her screaming, I'm so scared?
17:22Remember the classic Saved by the Bell episode? Jesse Spano, yeah. That was 33 years ago. Okay. How does that make you feel? I mean, I spent a lot of my summers. My brother and I talked about this the other day. Our kids are in so many different things in the summer. Camps and going away to things. And they're packed with stuff to do. Every day, it's a different thing. And when we were growing up, we had the TV. That's what we did. I watched Saved by the Bell reruns. And I watched movies on USA. Like, I didn't have a summer planned out for me. Anything. I know you did the camp thing when you were young, but my summer, maybe I did a basketball camp here or there, but I really didn't do anything.
18:03The TV was basically my babysitter when I was growing up. Yeah, we grew up with A.C. Slater and Zach Morris. It's true. All right. One more to add to America is Rich. This is from the Economic Innovation Group. And they did a study on wages in America versus wages in other developed countries. and they broke this out by states, all 50 states versus all these other countries. And only workers in Luxembourg and Switzerland have higher wages than the lowest wage US states. Okay, so average wages in Mississippi are higher than average wages in Germany or Canada. All right, no offense Germany and Canada, but that's kind of embarrassing.
18:46And no offense to Mississippi either, but... But then you take like West Virginia is higher than Austria or Denmark or Belgium. And these are pretty shocking. I'm sure you could probably poke some holes in here. And the funny thing is, they give another chart that says the reason. And why do you think that our wages are higher? Just tell me. We work more. We work more hours. So that's part of it because they take more vacations and stuff over there. And they're more laid back. But isn't this – that's pretty surprising, is it not? The majority of U.S. states have higher average wages than most of the developed countries around the world.
19:24I did not know that. Americans are richer than they think. All right. Something we don't talk about enough as far as good news goes, so I'm going to talk about it. Torsten Slock does his weekly economic update now for Apollo. I think he does it on Sundays. And he shows this U.S. daily national average gas prices. And you look at it, it goes back to 2004. And it fluctuates all over. But really, if you look at it, if you draw a trend line on here in an average, right now at$3.5 a gallon, We're pretty much on or close to the average we've been since 2004. If you inflation adjust this, ChartKid Matt did the price of oil inflation adjusted.
20:032008 inflation adjusted peak is$696. We're at$288 now. The funny thing is, 1970s inflation adjusted was probably double what the price is now for oil. That's how bad the 70s were. On an inflation adjusted basis, Oil prices have gone nowhere for years and years and years. Another chart, personal consumption on energy over total personal consumption. So this is the percentage of money people spend on. Our friend of the show, Tal Smith from New York Times, sent us this one. Percentage of their budget people spend on energy is the lowest point ever was 2020, which makes sense. But other than that, this is about the lowest it's been.
20:44There was a 2016 period, 2008. but look at how much higher this used to be. It's gone from 10 % in the 80s to 4 % now. We'll take it. It's not bad. Good news. Ben, I just turned my head and saw somebody on CNBC that I haven't seen in a long time. And he looks significantly older, as I mentioned. CNN on your TV all day, on mute, obviously. CNBC. Yeah, on mute. You said CNN, CNBC. Close enough. No, most days my TV's not on, but today it is. and looks a lot different than the last time I saw him. This weekend at the beach club, I saw somebody that I hadn't seen since college. For those of you who don't know, I went to Indiana University, was an early admit to the Kelly School of Business, not to brag, got kicked out twice, also not to brag.
21:34So yeah, I was not, it was not a great student, was not a great human being. And the person that I saw at the beach club, I guess I haven't seen him since college. So it's, my God, it's 20 years. and so we're hanging out, talking, catching up and he saw me with my kids and he goes, I just can't, it's so weird to see you and me as a functioning member of society. It is hard to imagine the friends you had in college having kids and having a real, I agree. Wait, so who's the person you saw on CNBC? You didn't tell us. I don't want to say his name, it doesn't matter. All right, so speaking of TV, I got to ask you just because I have a thought in my head.
22:09Do you watch the Olympics? I can't see you being a big Olympics guy. Yeah, I'm not that into it. I watch men's basketball. Okay. All right. See, I love, love watching the Olympics. Okay, so the way that you just said it felt like a put-down. It felt like a put-down. I'm questioning your patriotism. I love the Olympics, and I'm pretty sure that you don't care about it. It felt like a put-down. No, it's kind of like I can just, you're not. It kind of was.
22:41No, say more. Go ahead. I had a funny, I just had some Olympic thoughts. I was watching handball yesterday. Handball? What the hell is handball? They have the little ball, and then it's kind of like basketball, but you throw it into a net. It's basketball and soccer combined. It feels kind of like basketball. Remember Basketball, the movie? I don't know. Handball is a sport. It is. But my comment on it was both of the goalies were wearing Adidas Sambas. Remember those shoes that you wore in high school? Yeah. And my whole point was like, you can't wear Adidas Sambas and call yourself a real sport.
23:11That's like an intramural sport if you're wearing Sambos on the playing field. Is that fair? Yeah, there's no support on those sneakers. Give me a break. True. That's how you'd blow out your Achilles with one of those. For sure. By the way, it's funny you mentioned that. I did hurt my back tying Logan's sneakers yesterday. I was supposed to play basketball, and I was a healthy scratch. An unhealthy scratch. Tying your child's sneakers. I'd bet them and go, ah, good fuck. Okay. So you're going to hurt yourself off the court before you hurt him on it. Okay. We just spoke with Mike Simonson earlier today.
23:46So that episode is coming out on Monday. Mike is an expert on all things housing. It was a great conversation, was it not? It was awesome. Mike is the man. I love his weekly updates. And the whole backstory of how he started tracking data on a weekly basis and created his firm, it's really cool. I forgot to ask him about this phenomenon. US mortgage rates eased last week to their lowest level since early February. This is from Bloomberg. While a further decline in home purchase applications suggested even cheaper borrowing costs may be needed to stir demand. So in other words, rates are coming in, but an index of mortgage applications decreased to the lowest level since May.
24:24So is this like, I wonder if this is more seasonality or more, we just need lower rates. Is it also kind of like an inflation thing? The whole worry about inflation is that it'll become ingrained in people's minds. And so they buy more now because they're worried prices are going to rise in the future. Is the housing market a thing right now where you're trying to time it and you go, yeah, it's 6.8 % now, but what if it's six in like two months if the Fed starts cutting? So I think that's the hard part with people. I don't know if buyers are getting that cute, but you might be right. There might be.
24:52This is why the Fed needs to cut though. Housing activity getting this low is not healthy for this economy. We need more housing activity. It's a big part of the economy. The NAR had this this presentation they shared with all these different slides. And they looked at annual existing home sales that this year is the worst since 1995. And there's 70 million more people in the US now than there were in 1995. But they also shared some other things about like sellers can't wait forever. They said over the past two years, there's been 7 million new babies born, 3 million marriages, 1.5 million divorces, 7 million people turned 65, 4 million people died, 6 million people got new jobs on a net basis, and 50 million people switched jobs.
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25:36You can only hold it on for so long. Question about this. Are we still, are half of us still getting divorced? Okay, that stat is a misnomer. I think the divorce rate is 50%, but most of... Yes. Oh, thank you, my wife. New, what is this? I thought she was bringing you a Starbucks. What's this called? Oh, title and the registration. New registration. Oh, for your car? Yes. Does it tell you how far underwater you are? I never know what to do with these. Okay. I got a letter. Response to this notice requested. Attention, Michael Batnick. This notice is to request that you please contact us regarding mechanical coverage on your 2023 Jeep Wrangler that you serviced with us.
26:26Limited warranty. Is this a recall? Well, I never heard of these letters. You ever have a car recalled? Yeah. If I'm going to be honest, I usually throw in the trash. Unless it's something really important, it's more of a pain to bring the car in than it is to get it fixed. Limited factory warranty coverage. Yep. Sounds like garbage. It's a lease. Yeah. All right. Wait, wait. Why is that data a misnomer? What's a misnomer? Oh, okay. The divorce rate. because technically the divorce rate is 50%, but it's mostly people who've been married multiple times. So the person who gets married four times and divorced three times, like the majority of the people who are getting the divorces are people who get multiple divorces.
27:09You son of a bitch. All right, so for people that - I can't remember where I heard that. Well, okay, so I would say, so a hundred of people who only are married once don't get divorced. Right, I mean, obviously people do get divorced once, but most people getting divorced do so multiple times. All right, so if you back out the people that get divorced multiple times. Hopefully someone can send us the data. Okay. Here's a good one. Chiming in to support Ben's theory about housing market being squeezed for another decade or so. Reason, step up in basis on capital gains. I have a family member who bought a small home in L.A.
27:39in the 70s for$150 ,000. They regularly get people offering$2 million to$2.5 million. Despite the neighborhood around them having sold, knocked down, McMansions being built, they're refusing. So exclusion from cap gains for a couple on a primary residence is$500 ,000. they're saying basically they have a huge gain but if they live in it, die, and then their daughters sell it, the step up basis takes away the whole tax bill because you can only have$500 that you don't pay taxes on for a house so they're saying that's an extreme example but for a lot of people that will be their inheritance they give to their kids right and so the boomers are going to wait and wait and wait and hold on to those bigger homes for a lot longer than people assume probably so they're disincentivized to sell the older they get.
28:27That's a pretty good theory. Pretty good. Ben, I don't know about you, but I've been
28:36using the quarter app for the last two weeks aggressively. I think that listening to what these companies are saying gives you a much cleaner, not cleaner, a much more informed view of what's happening in the economy versus some of the official economic data points. I also like to, if I don't have time to listen to one of these things, and if I do, I do it on two times and I hit the Q &A button. But I like pulling up the slides as well. Because a lot of these really big companies have great slides. Yes. Right? So I like looking on the desktop and looking for the slides. I think Spotify has the cleanest slide deck if I had to pick.
29:16Okay. Lamb Weston, a company that I had never heard of. I listened to their call last week. They sell potatoes. You could have given me 10 different things that they could do. They're a sheet metal factory, and I never would have known. I would never have guessed potatoes. This is in the profile from Ycharts, which, by the way, great way to just – wait, what does this company do? Go to the Ycharts profile. Lamb Weston is North America's largest and the world's second largest producer of branded and private label frozen potato products, both by volume and value. The company's portfolio is anchored by French fries, but it also sells sweet potatoes, fries, tater tots, diced potatoes, mashed potatoes, hash browns, and chips.
29:51That's a lot of potatoes. I don't think we've ever had this conversation. You're at a steakhouse. What type of potatoes do you get? I'm a french fry guy. Oh, even at a steakhouse? Yeah, they get the big steak fries. Potatoes, like mashed potatoes, okay. Baked potato, okay. French fries. I was about to say, this might be too out of a take. Are potatoes overrated? Maybe this is recency bias. Maybe I'm just being influenced by the results of this company. French fries are one of my ultimate delights in life. So no. No, that's true. Properly rated. Yeah, that's – I'm only joking. So what happened?
30:30People aren't eating much potatoes? I don't like fat potato fries. Okay. Yeah, I'm a skinny potato guy as well. All right. So tell me if this sounds good or bad. Here's a quote. Here's how they open the call. We are disappointed by our fourth quarter performance. Our price mix results were below our expectations While markets shared losses and a slowdown in restaurant traffic in the US And many of our key international markets were greater than we expected We also incurred losses related to a voluntary product withdrawal We expect fiscal 2025 to be another challenging year The operating environment has changed rapidly over the past 12 months As global restaurant traffic and frozen potato demand softened Due to menu price inflation continue to negatively impact global restaurant traffic We believe the supply-demand amounts will persist through much, if not all, of fiscal 2025.
31:20Do you think the stock went up or down? You know, credit to Tom Warner for taking it on the chin here and not, like, trying to spin it positively. He was, he admitted it. Yeah, so the stock was down 28 % of the day. That makes sense. You know, I have a lot of respect for people who are willing to admit they're wrong. My kids, a couple weeks ago, what were we doing? They did something where they weren't listening. And my wife and I had to kind of let them know, you know, you guys haven't been listening well today. And we said, you guys are in the way to get my kids really scared. I'll just say you're in big trouble.
31:49And I don't ever follow through with anything, but I say, hey, you're in big trouble. And that, whoa, whoa, what? Okay. That only works with Midwestern kids. I guess so. My son loses his mind when I tell him he's in big trouble. But if I tell Kobe he's in big trouble, he just, he doesn't, doesn't even. And my youngest daughter, Kate, started crying. And she said, I'll take the blame. It's all my fault. Of course, my other two kids didn't take any blame. That's very impressive. Taking the blame, that's a good personality trait. You know what's interesting about this earnings season and just this year in general?
32:17A lot of the companies that are just getting blown up, we discussed this a few weeks back, are just the giant brand names. Starbucks, McDonald's, Nike, Lulu. Can you blame it all on them hiking prices too much and getting out over their skis or not? A lot of it. Is that too simple? No, I think it's a pandemic. Things were too easy. And they got complacent. Then we're reacting to an environment that was changing. And it's hard. Okay, so I talked earlier about Netflix. I said, tell me to buy Netflix if it's down 70%. So I didn't see. Nike is down almost 60 % from the highs right now. Is that just another one of those?
32:55You have to buy a brand name stock like that when it's down so much. I actually already, I sold Nike on the gap down. So I own the stock going into the print and I sold it on the gap down. On the one hand, I agree. Nike is still the brand name leader. And so it's been de-risked, whatever. But on the other hand, it's really had a lot of really, really, really bad missteps. And there was an article that I shared with you and Josh earlier, highlighting management decision to go from wholesale to direct to consumer. And they blew a hole in their ship. and this sort of thing is going to take months, quarters, if not probably years.
33:39So they stopped going through as many store channels? Is that the problem? Yeah, they f*** all their biggest customers. And they said, we're going to go straight to consumer. So I don't know. I just think that this is going to be a really bumpy road to recovery. But the other point is like, well, when does an activist investor come in and like de-risk you further still and make sure? I don't know. I, yeah, maybe, but not for me. Not here, not now. All right, speaking of Nike. So yeah, they're on pressure or under pressure from OnCloud and Hoka, which I'm not a Hoka guy. Do you have a pair of Hokas?
34:16I haven't gotten into any of the new sneaker brands. I wore some Allbirds for a little bit, I guess. I kind of grew out of those. I never did Allbirds. What about ButOnClouds? You never got OnClouds? I'm a Nike Adidas guy. Okay. I would say I'm like 90 % Nike, but on clouds, I do have a few of those. New Balance, apparently, is like a monster. Sarah Eisen tweeted, New Balance CEO reveals over$6 billion in annual sales, making it the fourth biggest sneaker company by sales. Did you know that 40 % of all New Balance sales come from dads with white New Balance wearing jean shorts? Yes, it did. That's a, yeah.
34:53So I also don't think I knew that New Balance is a private company. Well, I didn't either. I would assume they're owned by Puma or Adidas or someone like that. Yeah. Ben, did you see Apple is coming up with a foldable phone?
35:11What? Why? Doesn't Samsung have them too? So I'm sure people are asking for it to have a smaller fit for the pocket. Oh, yeah. What's next? Spotify is going to come out with a CD player? True. I will not be a foldable phone purchaser. I just, how does it work? There was something about, there was something about closing the phone, right? That's true. I'm done with you. Boom, close it. My first little Motorola one. It was one of those tiny ones, you know? Yeah, those are great. Is there going to be an antenna too? Remember antennas? Oh yeah, my first one had an antenna on it. That's true. The funny thing is the antenna was like two inches.
35:46Like, did it really do anything? No, I'm saying. And it always just fell off. But there was an antenna that you had to actually. Oh yeah, yeah, you'd pull it up. It would always fall off too. Speaking of like old things, I was talking about this with my friends over the weekend. Remember back in the day, like a huge innovation was you had like the six CD changer in the trunk of your car? Oh yeah. Like, oh, six CDs? That's true. Oh yeah, and the boom box as well. Things are pretty good these days. 20, yes. Speaking of phones, this is a great PSA. The subject of the email was lost phone tip. Because last weekend, I almost lost my phone.
36:23when we were talking about this on the show. Edit the wallpaper photo you have in your phone and add text. Add your wife's phone number and add, if you found, please call Michael at whatever the phone number is. I love this tip. I'm not going to do it, but I do think it's smart. Kind of makes you feel like a dog though, right? The dog with a phone number on the collar. It's a good idea. I probably would never do it either. Listen to this nonsense. Subject line phone etiquette. The other night, my wife and I were eating dinner at a sushi restaurant. We were seated outside next to the sidewalk walk in front of the building.
36:53Shortly after we were seated, a young couple, early 20s, were seated directly behind us. After about five to 10 minutes, we heard EDM music being played from someone's iPhone in our vicinity. My wife glanced around to see that this couple had propped up their iPhone in an empty glass on a neighboring table playing their own music at full volume. We were dumbfounded. My gut reaction was, wow, Gen Z is messed up. In what world is this an acceptable thing to do? Have you guys experienced behavior like this in your own lives? Do you think we said something? We're both from the Midwest. They definitely didn't say anything.
37:22They definitely didn't say anything. This is outrageous. So one of my worst habits people have is talking on either FaceTime or speakerphone when they're calling someone and other people around. You can't do that. You can do it in your car, on your own if you want to. But if other people are around, you should get a ticket from the police. You should not be able to talk on speakerphone in public. Citizen's arrest? Yes. Boom. Ticket. I saw at the Foo Fighters concert, there was a dude in front of me who had his FaceTime on the entire time. And I saw his wife was just like doing the dishes. She was cleaning up the entire time.
37:58Do you think he's a very, very caring husband or he was in a lot of trouble? That's a good question. That's weird. Who would care to watch a concert through a phone? People do it though. People tape like the whole show. They never watch it again. Ben, I want to talk to you about a tweet I saw from Morgan. A tweet thread, I guess. It's only three tweets. Is that a thread? Probably not. Anything over two is a thread, right? Okay. Morgan tweeted, a disingenuous take is when someone predicting the economic collapse says, I hope I'm wrong. I would love to be proven wrong here. Of course. Yes. Right?
38:34That's a - Listen, I'm not a bad guy here. I'm just telling you what I - Yeah. Don't shoot the messenger. I don't want to be right. I'm just warning you in case it does happen. If it doesn't happen, I was just trying to protect you. How about this? If you say, I hope I'm wrong, you really secretly mean I hope I'm right. Every time. Of course. But so that's a thought that we've probably had a million times, right? But I never thought about it this way. And this was the interesting part. He said, a similar take I heard recently that explains a lot of things is that some people like to be offended because it gives them an intoxicating sense of moral superiority.
39:09I never thought about that. And I was like, oh, yes, that does explain a lot of the outrage, the outrage porn. Yeah, that's true. I'm smarter than all you idiots because I'm paying attention. Yeah. So speaking of outrage and porn, Twitter, I don't know about you, but for me recently, I've been on the For You tab and I do not like what's happening. It feels TikTok-esque where it's like just serving you up the nastiest, shittiest, addictive stuff. And for me, it's like a lot of violence. And sorry, I don't know if it's just me, but I watch it. I don't ever go on the For You tab. If I do by accident, I immediately get off of it.
39:47I do not want to see, I don't care what they tell me. I want to have, I want to have my own filters in place. So the for you tab is dangerous. I stay away. Because it is serving you like the, so I won't, I will not download TikTok because I know that I will just fall in and I have no interest in that. The for you tab is doing it to me. And I'm like, I feel icky and I'm on it for like 10 minutes. I'm like, what am I, what am I, what am I looking at here? Just the most horrific shit on the internet. Anyway, so Elon. If I could, if I could block one thing for my kids growing up, I was talking with some friends last week, like, when do you buy your kids a phone?
40:18My daughter's 10. She's already started asking. We're going to wait until at least he's a teenager, probably. But I wish that you could just say, I'm going to block all algorithms from you. You can go on social media when you're older, but no algorithms. No, I'm going to block all the algos. No social media. It's too dangerous. Well, that, yeah, that too. That's going to be at least 16, maybe, for social media. 18? So speaking of dangerous, Elon is, in my opinion, a pretty dangerous person. Now, you might think this is a political statement. I don't view it as a political statement. I don't even think Elon's politics are all over the place, right?
40:53He changes pretty quickly. But right now, he tweeted – he quote tweeted somebody who said 76 % of all personal income tax last month went to servicing the$34 trillion national debt. And Elon, who is the wealthiest man on the planet and one of the top – I don't know, two most powerful people on the planet, right? Like he's tweeted, America is headed for bankruptcy. FYI. FYI. I hope I'm wrong. No, he didn't tweet. I hope I'm wrong. I wish he did. So Twitter is getting killed. The estimated revenue is down over 80%. Have you ever gotten, this is pre-Elon and during Elon's reign. Have you ever gotten an ad on Twitter and you go, they know me.
41:33They got me. Yeah, I don't get it. I've never gotten one. I've spent millions of hours on this platform. him. He also apparently tweeted a Kamala Harris AI fake video.
41:46I don't know, man. I don't know what that. Now, listen, I know it's sort of lame to complain about Twitter and don't, don't bite the hand that feeds you. We've obviously gotten a lot of benefit from the platform over the years and it's still a great place for certain things and meeting people and all that great stuff. But holy shit, is it bad too? Well, Elon Musk has become kind of a stand in for politics as well. There are still certain people who will defend him to the death no matter what, and other people who hate him no matter what. And he's become a political figure almost. No, but not almost.
42:16He's becoming like a lightning rod. He's in the center of the universe. Maybe you get to the point where you have that much money and nothing else excites you anymore. It was like the Sarsgaard guy on Succession. Remember, he's like, making money doesn't excite me anymore. You know what excites me? losing money. Maybe that's his thing. I already have enough money. Who cares if I piss away $44 billion on Twitter? I'm still going to be fine. Alright, story time, Ben. I don't know if you know this about me, but I've become a food influence-y. What that means is I am the target of food influencers.
42:51Just please don't ever call yourself a foodie. I won't, I promise. Is that one of the worst words? That's worse than fam. I'm a foodie. Who doesn't like food? Yeah. Oh, you like food? Whoa, tell me more. That's so interesting. Guess what? I like music. Oh, no way. So the Instagram algo has been serving me up a lot of recipes. By the way, if you want to know somebody, like really know somebody, you look at their magnifying glass on Instagram, like what are the recommended things? And I'm not going to tell you what the algorithm serves me because it's personal. But you can learn a lot about somebody from that, no?
43:26Okay. I don't go on Instagram a lot, so I don't know. I don't even know what mine would be. I didn't know you could do it. What's a magnifying glass? The search function. Okay, gotcha. I assume it's a magnifying glass. I think it is. So I made something over the weekend that I brought to the beach. It was pretty hot, not to brag. There was people that were getting very interested. Can I tell you what it is? You cook your own food to bring to the beach? Not usually, but I had to share. It was so good. Well, it can't be hot because you're on the beach. It's got to be something cold. Something cold.
43:53Okay. Something that might sound disgusting when you bring to the beach. Okay. This food is very divisive. It's a political lightning rod of food. Let's hear it. You either love it or you hate it. Egg salad. Okay. Not an egg salad. I know people love egg salad. You're right. It's a love it or hate it. Potato salad, egg salad, all those kinds of deli salads. It's love it or hate it. Yeah, nobody's take it or leave it. You either eat it or you don't. But here's the thing. I don't eat it, yeah. So here's the thing. It was also, so it's like mushed up with avocados, pickles, lemons, and all sorts of other accoutrements.
44:27Oh, and Dill. Dill was a key ingredient. Quite good. Okay. Here's another thing that is take it or leave it. That I was thinking about this week. Playing cards. Okay. You're either a card player. You don't dabble in cards. You're a card player. You're not a card player. Because when my family gets together, we went away for a little family vacation this past weekend. And we played cards every day, every night. That's the thing we do. We drink beer and we play cards. Are you a card player? Yes. You are. Okay. But, but, but do I play cards? No. Okay. But you know how to play. You know how to play cards.
44:56I love, I love, matter of fact, I might, I was talking with Jeremy Schwartz the other day. He's go, he's, he plays cards. He's going to the World Series of Poker in Vegas. Now there's like, there's not like, there's a main event and there's like a million other small games. I might go with him next year. See, poker is actually the one game I don't play, but I have a, I have the greatest card game in history that I'm going, I'm going to bring a deck of cards to future proof. We're going to play a card game. I'm teaching you a new card game. Trust me. I'm going to make it happen. What's the name of the, what's the name of the game?
45:24It's just called the one card game. That's all I'm going to say. Okay. Did you make it up? Because I don't think I like that. I didn't make it up. Okay. I don't make up game. Ben, I got charged by StubHub recently. Forgot to tell you. How much money have you lost to StubHub in the past 12 months? So this was in April, this nonsense where they charged me five times for selling tickets. They ended up only charging me, I think, twice. And then there was an investigation. I got charged like three weeks out of nowhere. I got a$1 ,400 charge or whatever it was. So you know what I did? I called Amex.
46:02I said, I explained the situation. They understood. They canceled the card and they're disputing the charge. Wow. You need an Amex on your side. Yes. It's worth thinking. I've had Capital One has told me no a few times on some of those, but it's worth having the conversation. Yeah. All right. A couple. So we went to this place in the middle of nowhere in Ohio where they have all these caves and hiking and waterfalls. It was beautiful. And we were kind of in the middle of nowhere. So internet basically didn't work. We stayed at a cabin. And I often think, how boring was life? If you think in the past 150 years or so, before then, for tens of thousands of years, people didn't have sports.
46:42They didn't have internet. They didn't have TV. They didn't have games. They had no form of entertainment. What did people do to keep themselves from being bored before all this stuff existed? and I think most people probably just sat and stared at the fire that was keeping them warm because we had an outdoor fireplace that is great I love to do that with chairs around it on the big deck and it had a chimney so the chimney worked great so you didn't get any smoke at all and there was something to be said about fireplaces just so sitting around telling stories drinking beer listening to music and we did it every night and is it possible fireplaces are underrated can fire be underrated is that a hot take not possible get it I know No, that was clever.
47:24But I don't know if you know this about me. I've spent hundreds of hours, borderline thousands, in front of a campfire at the cabin upstate. That's like what I like to do. And you have a little fire pit in your backyard. Front yard. Oh, in my backyard. Yes, my own backyard. True. Yes, which you sent me a picture of the other day, and I totally forgot that you literally have fake turf in your backyard. Yeah. Which is crazy to me. Do you have the little pellets like at the football field one? No pellets, no pellets. Okay. Yeah. Oh, wait, one more thing about going. So when we get to get my family, we are a family that likes to have fun.
47:56Like I said, we play cards. We drink. The first night, everyone always goes out pretty hard. You know, like we're staying up late. We're drinking. We're by the fire. And when you say my family, I want more information. How extended, how extended are we talking? So every year, my parents plan a little trip and it's my whole family with my wife and kids, my brother, his wife and their kids, and then my sister and her husband. So there's 15 of us. Okay. So it's all just me and my siblings. and... That's very nice. I feel like that's a very nice thing to have. Yes. But we go out hard the first night.
48:26Now, this is a middle-aged thing. Second night, everyone goes to bed early because you can't do it two nights in a row in middle age anymore. Nor do you want to. Right? The staying up late, the drinking, the... You can't do it two nights. Two nights in a row is hard. I went out Thursday, Friday, and Saturday. Speak for yourself. Still got it. Although, I'm much younger than you.
48:48Listen, I... The thing is, I still get up early with the kids after a long night like that. I can hang that way and go hiking and all that stuff. Sam Rowe tweeted, this is a great chart from Charter. Can streaming save the music biz? And it's showing US recorded music industry revenues. And vinyl obviously went away. Cassettes next, CDs next. And in there, Sam spotted ringtones. Do you remember that? No. For kids that don't know. I never paid for a ringtone. No way. As a guy who doesn't use emojis, you think I was going to pay for a ringtone? Yeah, I don't think you did. I feel like I might have, but what ringtone would I have paid for?
49:29Some sort of like 70s rock.
49:34Either Billy Joel or Dr. Dre. The thing is... I don't know. I don't think I paid for a ringtone. The whole like 1990s CDs and DVDs, that was to me seems like a one-time deal. That is never coming back in terms of a revenue generator like it was in the past. Oh, speaking of that, hang on one sec. Duncan, stop recording. Press pause. One sec.
49:59Is that a CD book? So I told you we cleaned up my closet in my office. Look at this thing. Robin goes, what are you doing with this? I said, don't touch my DVDs. Oh, those are DVDs. I thought they were CDs. Do not touch my DVDs. Oh, man. Speaking about nostalgia. Holy moly. Okay, look. You know what? The first page, I haven't opened this up in 20 years. What a great representation of who I am. This is heavy. I see aliens. Okay. Ali G. Oh. Oh, these are? Oh. Ali G. Eight Mile, Aliens, and Airplane. I had these in alphabetical order. Wow. Now, my guess is back in the day, you had a DVD tower. 100%.
50:47Giant. Everyone had one of those. Giant. You know what I would do? Oh, man. Delirious. Eddie Scissorhands. Oh, man, this is fun. Remember, so at Blockbuster, like, they used to sell, like, two used DVDs for 20 bucks or 10 bucks or whatever it was. I was all over that. Think about how much more expensive that used to be, too, than buying a streaming platform today. But you know, it's interesting the price is like I we spoke about blu-rays at Walmart or whatever. They're still like 24 bucks Yes, I don't know who's paying for those who Somebody is All right, Ben Recommendations I want to talk about for a second about a little stock that I bought a couple of months ago IMAX supported the movie industry in more ways than one And all the movies you go to how many times you go to IMAX versus regular because it's harder and sometimes it's harder to get Like, we're going to see, my wife, the kids are gone this week at camp.
51:45My wife and I are going to see Twisters and I want to see it in IMAX. Yeah, yeah, that's an IMAX movie. I don't know, I don't know, four times a year maybe? All right, they put out a release. Deadpool and Wolverine scores biggest IMAX opening weekend since 2002, since 2022, excuse me, with 36 and a half million dollar. Ryan Reynolds, the guy's so hot right now. Who is? Ryan Reynolds? Biggest IMAX July opening ever. Biggest IMAX R-rated opening weekend ever. Biggest IMAX opening weekend of any movie since Avatar The Way of Water and biggest IMAX opening weekend of a Marvel movie since Spider-Man No Way Home.
52:17Pretty good summer for movies. So listen to this. Deadpool and Wolverine opened to$19.1 million. This is for IMAX. Good for 9.3 % of the domestic box office on approximately 1 % of total screens. So it's a premium experience. As a matter of fact, the Wall Street Journal wrote an article about IMAX's success. They said fewer people may be going to the movie these days, but those who do clearly are willing to pay up for a better experience. Oddly enough, though, the box office downturn is proven to be another flex for IMAX. So it shows a chart of the share of Dimex's box office per year. And it was 3 % in 2018, and now it's pushing up against 5%.
52:59People like IMAX, I get it. You're not going to the movie theater that often, but when you do, you want to get back. You want the good speakers, you want the big screen. Top shelf. That makes sense to me. Anyway, Deadpool and Wolverine, monster. So Friday's out. How is the stock doing? Look, how's the stock doing? It's breaking out. Oh, it's up to 30 % this year. Friday, Saturday, and Sunday,$444 million. Wow. 211 domestic, 233 worldwide or international. Pretty wild, huh? I will be watching it when it comes out on streaming. I'll probably watch it when it comes out on streaming. I really liked the first two.
53:35Okay, it just doesn't do it for me. But all right, Ben, what do you got? Okay, my son is a huge fan of the Planet of the Apes movies, the new ones. So there's been four or five of them, I think, now. And so we just watched The Kingdom of the Planet of the Apes last week. I had to buy it for him on Amazon because he couldn't wait. The funny thing is, these are the kind of movies that shouldn't work. And it actually is not, it's kind of entertaining. My son loves them. They're just okay. Did you see the first three? Oh, yeah. I watched them with them. They're excellent. They're actually, it's pretty, for this, for having four of them.
54:04Dude, stop hedging. Don't beat around the bush. They're great movies. You can say it. surprised how good they are. That's what I'm saying. Okay. But wait, so how was the Kingdom of the Planet of the Apes? It was good. I liked it. Because it's like a reboot. It's a new storyline. Well, it's into the future. It's further along. Yes. It was well done. Okay, so I finished the Presumed Innocent show, which I thought was good. I was actually, I love the whodunit kind when you know they're going to tell you on the finale. I was genuinely excited to watch the finale. I thought the last two episodes were killer.
54:34You could pick nits if you wanted to with this show. on like the ending. But the night before the finale of the show, I had never seen the Harrison Ford movie before. So I watched the Harrison Ford original movie. Okay, is the twist the same? It's not the same. Oh, interesting. But the movie twist is really good. I'd never heard of it, of the ending. I knew it was a twist. And it still surprised me. I thought it was really good. Which my wife said was unfair going into the finale of the show that I watched the movie first because I had preconceived notions. Because I guessed who did it in the show.
55:06You did? I picked, yeah, I guessed it. But my wife was like, that's not fair. You saw the movie first. And I was like, well, it's a different, anyway. So it was good. Wait, you know what they did with Presumed Innocent that was interesting? They dropped it a day early. Oh, did they? I think so. Yeah, good show. It could have been a couple of episodes less, but I don't care. I love horror shows. We spoke about that on episode four. It was just like, come on. It just was dragging for no reason. It ended, it ended. They have to be six episodes. Most of them do. All right, I've been reading the book Heat 2.
55:36which is both a sequel and a prequel to the movie heat. And I love the movie. So I'm a little nervous about these things. The book's actually pretty entertaining. And I think it sounds like they're going to make a movie out of it. And I think I'm okay with it. I say do it. I'm surprised how much I enjoy the book. Well, they just started filming? I think they talked about it. Okay. But I watched... Oh, Inside Out 2 is now the highest grossing animated movie of all time. Crazy, right? Box office is back. That is wild. I watched Horizon. Oh, and? It took me three or four seating settings, seatings.
56:16It was fine. Like, it wasn't great. It wasn't. It was a decent Western? It was whatever. I'm not a big Western guy. I just was more curious than anything. Will you watch the second one? It was kind of boring. No, I'm not going to watch the second one. Okay. And I'm not surprised that it bombed, and I'm not surprised that they pulled the second one. It was just a whatever. I don't know. What is he thinking? It was like, I'm going to make Dances with Wolves, but way worse. And it wasn't like Dances with Wolves. It was just a Western, but it was not compelling. Really not much happened. I think it took me like three or four settings.
56:44So I can skip it. Oh, yeah. A comfortable skip. All right. I saw a tweet or a meme on Instagram, and it was like, my 10-year-old can watch this movie in 1995. Okay. And I'm looking at the movies. I'm like, that doesn't look like 1995. So I spot checked it and it actually, they weren't 1995 movies. Point was taken. But last week I was talking to you about like Venom 3, which is rated R and can I or can I not take Kobe? So I want to talk to you for a second about some of the movies that I saw when I was six, seven, and eight years old. So in 1991, I was six years old and that's when Terminator 2 came out.
57:27And I remember vividly my dad rightly saying, credit to him, this movie is not for you. And I cried. I was really sad because I remember my brother and his friend went. I couldn't go. Terminator 2 was 1991. Did you see that in 1991? You were, like I said, you're a lot of older. I saw it when it came out on VHS. Okay. I didn't see it in the theater. All right, so this is what I did see. I did see these movies in 1992. The Bodyguard, which I do want to rewatch because I don't have any memory of that, but I did see it. And Under Siege. Speaking of Costner. Under Siege, that is wildly inappropriate for a seven-year-old.
57:59Where the girl jumps out of the cake and annoying guys die. All right. Passenger 57. Remember that one? Always bet I'm black. Universal Soldier. Is that a Van Damme movie? And Drago. I'm drawing a blank on his real name. Dolph Lundgren. Remember The Ears? Oh, yeah. I saw that when I was seven. And The Lawnmower Man. I don't remember that exactly, but I know I saw it when it came out. 1993. Demolition Man. So in 1993, I was eight years old, Kobe's age. Demolition Man, Cliffhanger, Alive, Fire in the Sky, The Good Son, The Program. The Program is, I should not have seen that. Falling Down. Do you remember that movie?
58:43I used to love that movie. I don't know why. And then on the complete other side of the spectrum, I also saw Homeward Bound and Free Willie. Those were more my speed. So I don't know where to draw the line. I was seeing wildly inappropriate stuff, but I don't think I want Kobe seeing R-rated movies at this age. He feels way too young. It's the language for me. My son, he sees one of his movies and he parrots the language. My daughter, my oldest daughter, is just so averse to bad language and my son loves it. So if he hears it on a movie, he's going to use it. So we're like, you can't see Twisters if you keep using bad words, dude.
59:18And he's like, no, no, no, I want Twisters so bad. I don't know if there's cursing of Twisters. There probably is. Okay. Anything else? last thing we just mentioned this podcast with Mike Simonson but in Twisters it's interesting the bad guy is a landlord he's buying up homes after the tornadoes destroys them and it's now in pop culture I can see that people really hate home buyers okay that is interesting if because sometimes the economy seeps into popular culture it would be interesting if the housing market does in some way yeah interesting okay thanks to the production staff as usual. Duncan, John, Daniel.
59:59Hope everyone enjoyed their summer. Yes, it went way too fast. Email us animal spirits at the compound news.com. We'll see you next time.
From the publisher
On episode 371 of Animal Spirits, Michael Batnick and Ben Carlson discuss: how small cap stocks got so cheap, how to improve your chances of outperforming the market, why investors are rushing into bonds, Americans make more money than you think, good news on gas prices, how the Fed can help the housing market, the best way to eat potatoes, the downfall of Nike, IMAX theaters, and much more!
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