Is the Stock Market Invincible? (EP. 447)

25:05Right. We had a mini boom in apartment building when rates got really low. Then rates went high, and they pulled back on building. And so, yeah, you think lower rates should hopefully help that. All right, here's the kind of headline that gets dunked down in the future, potentially, depending on where things go. Every Wall Street analyst now predicts a stock rally in 2026. This is from Bloomberg. So it says not a single one of the 21 prognosticators served by Bloomberg News is predicting a decline and the average gain next year is 9%. Can you blame them? That's my only question. Can you blame them for predicting this?

25:34I'm surprised there's not like one person that's like sticking the neck out a little bit, but. Yeah, but also let's just, so I hear what you're saying, but let's just assume that there were one of the 21 strategists who did have a negative outlook, right? Who just was going to say, you know what? I'm just shooting my shot. I'll be a contrarian. I'll be the one. Does that change the takeaway? You know what I mean? I know the headline is like, LOL, every Wall Street analyst. But if it was every Wall Street analyst but one. Well, didn't a lot of the bearish people kind of get pushed? Like there was a couple bearish people and they kind of just, you're done for a while.

26:09Yeah. I guess my point is like just focusing on the headline. Yeah, fine. I mean, but it's always like this. Sometimes there's one or two or maybe three. They're always bullish. Right. But history shows they probably should be. That's what I'm saying. You can't really blame them. How about this one? Wall Street's risk on fever shows no signs of abating in New Year. Well, how about this? Let me just be clear. If this turns out to be a very bad year, we can cut this clip and say that I did not see it coming. I am not taking this as a watch out indicator. They're always bullish. So what? hey i said i said the chances of a bear market are decently high last week in the show didn't i i still i still kind of believe you know what's great about this show we say different things every week i forget what i said i what did i say 20 minutes ago i have no idea that's true no one holds us accountable all right so bloomberg says there's a synchronized cross asset rally in 2026 from meme stocks to high yield bonds small cap company shares showing no signs of slowing down so look at this the round hill meme stock etf is going nuts now again high yield is doing decently well.

27:05I got to take some umbrage with the, uh, the access for the high yield here. They show 80 twice and 81 three times. So, um, but Russell 2000 is finally joining the party a little bit. That's taken off in the last few months. Uh, so it's just showing that the risk appetite is hitting other areas. And again, I think some people would look at this and go, Oh no, I think you look at this and you go, the bull market is broadening out. Like from a, if we're looking at it from this, a technician perspective, which I'm not, I think you'd have to say the fact that things are broadening out, this is a good sign, right?

27:38It's a great sign. Come on. If you've been in the market long enough, you know that, of course, there's no guarantees. Nobody knows what's going to happen. But a broadening of the rally, a relentless uptrend with more and more stocks participating, if that worries you, you will never make money in the stock market. I'm telling you right now. If your knee-jerk reaction is to be bearish when things are going well, that's a personality type. And sometimes getting cute works, but generally speaking over the course of your career and your life as an investor, to be a knee-jerk contrarian when things look really good, that's not how you make money.

28:18Yeah. You can't say I'm worried because nothing else is going up except for seven stocks and also worried when everything else is going up now too. You can't have both. Yeah, I get the former. If you're worried because it's a really thin market, like, okay, yeah, that's legit. I get it, right? Like, it didn't work, but I could understand that mentality. If you think like this is as good as it gets because things are now working, like because the Russell 2000 is finally breaking out after four years of going sideways, this is super bullish. It just is. Deal with it. we've spent a decent amount of time talking about or wondering like what is going to happen with international flows like when are investors going to get excited um todd just sent me his deck this morning and one of todd's own at strategas one of the charts that he shared was emerging markets another area that has been just dead money doesn't even begin to do it justice i think like a lost 10 or 12 years almost it's and i think i honestly think it's it's close to 20 of sideways nothingness with lots of CHOP, lots of bear markets, just disgusting behavior.

29:19And he shows the rolling 12-month sum. And it's picked up in a serious way. People are getting involved. China's breaking out. Things are looking better, for sure. You'd be surprised. I looked at this the other day. I'm doing my asset quilt. Because last year was up 35 % or something. So in the last 10 years, what is the 10-year return for EEM, which is the iShares, the emerging market value, or move origin market index. You're never going to get this. Oh, really? Is it higher than I think? Annual return. Because I would have guessed annualized is like 4.5%. Almost 9.5 % in EM. Wow. You had 35 % last year.

29:57That helped. So that's higher than you would assume, right? So some of those bad years, the thing is, so here's the thing. If you look at the 10 years as of 2025 or 2024, the annual return is like 3 % per year. One of the bad years dropped off. A good year comes on. Now we're at 9%. So it's kind of a game thing. I'm looking at a monthly candlestick chart. And yeah, dude, this thing peaked in October 2007. And then it peaked at the same price in 2021. And we're basically just now getting above those levels from 2007. But guess what happens when investors see high one, three, five-year returns? They start to get involved.

30:37Oh, and then that's why money pours in. And so people are paying attention a little bit. But all right, let's talk inflation real quick, which came out this morning. We're recording Tuesday. What is it? Market just opened. What happened to your bell? You don't have a bell anymore. I used to have a bell. That was think or swim. Yeah, I'm a Y charts guy now. Okay. You used to always have a bell that would ring at open and close. You should just pay someone to come do that for you now. Just come and ring a bell in your office and then walk out. So the inflation rate came in at 2.7 % for all of 2025.

31:11That was the average annual inflation rate for 2025. All right. If you believe the numbers. Yeah. And guess what? People on Twitter, they don't believe the numbers. Anytime I post about inflation, comments aren't great. So YCharts has inflation data in the US going back to 1914. We're talking World War I. So 100 plus years. The average, I said that like a, that was a weird. The average? Chicago. That was Chicago. The average annual inflation rate in that time is 3.3%. That's like long-term US average. It's right around there, 3, 3.5%, something like that. We've been below that long-term average for how many months now?

31:50I'm giving you a lot of quizzes today. Six. 18 months going on now that we've been below the long-term average. Now, if you look at a chart, a long-term chart. Sorry, I'm not trying to be a jerk, but that is completely erroneous. I mean, after the worst inflation in 50 years, the fact that we're below average, I mean, it falls on deaf ears. Don't come to me with that. No offense. I have a new theory on why, because if you look at the historical chart of 100 years of inflation, this current period, I know we didn't have it for a long time. If you look back pre, like 1970 and before, all the inflation increases, you'd look at this now and go, that's so tame.

32:27What is wrong with you people? Why are you so up in arms and mad? This is nothing. This peak of inflation. You're kidding, right? No, I'm just saying, if you look at the historical record of all the inflation spikes before this, you look at this period and go, that's a drop in the bucket. What's wrong with you people? So listen to this. Listen to this new theory I have. I think what you just said is absurd. If you look at the long-term chart, you wouldn't pick this one out of the, there's 10 peaks that are higher. Were an alien to look at a chart and not understand human beings, would they say, would they make that conclusion perhaps?

33:02I'm just, yes, that's what I'm saying. Here's one of the reasons why, here's one of the reasons, and this is such a simple thing. I was just thinking about this the other day. Think about how hard it was to spend money in the past. It was impossible. You had the bank held your money for you. You had it under your mattress, and it was cash. It's so much easier to spend money now. It's harder for people to slow their spending because you can click a button. You can - There's no friction. It's so easy. I was thinking about this. I buy way too many clothes and stuff because it's so easy. I go on to what I get an email from someone.

33:35Hey, Ben, come on. 30 % off. Wait, you left this in your cart. Maybe 30 % off. Come on, come back. And it's so easy to spend all the next gear that I have like this here snazzy hoodie. Guess what? I never, not never. I would go to Models twice a year, maybe like now I I'm shopping 24 seven. I can't stop. Exactly. It's so much easier everywhere you look to, to, to shop just the click of a button, Amazon. I don't need this, but I want it. Or it's so much easier to spend. And so I think slowing your spending has been so much harder this time. You know what I bought on Instagram recently? I saw a video of like, what would happen if you drowned in a car and like why you can't open your window or get out.

34:19And it was an advertisement for like this little thing where like, you could like cut your seatbelt and like bash the window. when I bought two of them because obviously you can't just buy one. It's like a two-pack. And Robin's like, what is this? And I said, if we're, you know, if we ever fall into a lake and then I realized, I'm like... If you're ever part of a Harrison Ford movie, you can get out of the car. Yeah, there's no, there's no lakes around here. There's no... What am I doing? You drove off a bridge? What are you talking about? You're right by the ocean. You've got bridges that go over the ocean.

34:46This could happen to you. True. If the GW collapses while I'm on it and we happen to stick the landing, we could... Listen, you're looking you're looking down at your phone you don't realize and you drive right off one of those bridges that we go under on your jet ski like that's gonna save your life actually you know what i stand corrected great purchase i yeah i uh i'm on board but then you like you you land in the water then you go oh no where did i put it in the glove box is it in the middle shit it's at home yeah i can't find it you know what this brings up another so i've got i've got many character flaws way more time, way more time than we have available for this show to discuss.

35:26But one of them is like, I'll just a little nuisances, not even pile up, but just repeat forever. Like for, for example, um, I have sub stack on my phone. Uh, I think I installed sub stack the app on my phone. And so every time I get a new follower or new this or new whatever, like my notifications are turned on. That's what I'm trying to say. My notifications are turn on for Substack. And for about six weeks, I would get 11 a day and I would just like, oh, look at my phone. Oh, that's a notification. And I would just like, you know, clear it. And then I had this like, why do I have notifications on?

36:01Like I can turn them off, right? This is a choice that I'm making. So I turned my notifications off for Substack. And I also realized that like I've got notifications off for Amazon deliveries only because it's been on since the minute I downloaded the app for four years, I've never turned it off. I hate notifications. Anyway, I'm a, I don't know what's wrong with me. I just, I just let little things. You know what I did? Mine built up too. All my emails, because every time I sign up for a new clothing thing or whatever, so my email every morning is just full of all these different retailers trying to pitch me.

36:32Do you have, so in my personal Gmail, I have my main inbox and I've got a promotions tab and an updates tab. Well, I use Yahoo because I signed up for it when I was 18 years old. I know. My God, dude. But I went through and I umpsed. You use Yahoo? I know. It was my very first email. I have a Gmail and a Yahoo. But I went through an unsubscribe to every single email that came into me for a week. And now my email is so clean. Like I just hit unsubscribe to everything. That's what you use Claude code for. But wait, hold on. What do you use your Yahoo email for on a personal level? Is that just like your email account that's linked to like your flights, your this, your that?

37:09Yeah, I've just literally had it forever. I never changed it. And do I want to use Yahoo still? No, but I did it when I was 18 years old. And I haven't been able to change it since because that was the one email address I signed up for. All right, sign of the times. AI evaluation startup, LM Arena, valued at$1.7 billion in new funding round. $1.7 billion funding round is, you know, really sort of nothing with nothing. But that's not the good part. The good part is this. LM Arena, a startup that operates a widely cited ranking of AI models based on their performance, has raised$150 million. that's nearly tripled the valuation of its seed funding round announced in May 2025.

37:51Whoa. Kind of nuts. That's pretty quick. And again, I mean, obviously, I know nothing about the product. I'm not saying it's not a good idea or whatever. Whatever. It's just, you know, sign of the times. I had, speaking of sign of the times, I had Matt and Sean make me this chart of AI platform valuations for like the big three. So check this out. I'm dropping it in here right now. open ai anthropic and xai are now all valued over 200 billion dollars look at the look at these different so the the dots on the chart ben or when they raise money okay i mean you can't see this if you're listening but it's just up and to the right like kind of wild not kind of wild wild so when shouldn't when does this gap close a little bit between what and what?

38:43I think it's kind of over for OpenAI and Google. I think Google is like, in 18 months, we're going to go, wait, why do we think OpenAI was going to win? You saw that Apple said Siri is going to use Gemini for their AI. Don't you think at this point, beyond the inertia of people just using chat, that Google is clearly going to beat them? I don't know. You might be right. Am I jumping the gun here? It sure feels like that at this point. that it's inevitable that Google is going to be the winner. And I'm going to feel like an idiot at some point if it all falls apart. But that's what it feels like today.

39:18Well, I think two things. I think you might be right. That sounds like a premature call. But and also a$500 billion valuation for OpenAI, which was assumed premised on many different assumptions, one of them being that they were going to be like the dominant player. And they are. That sounds like a crazy high valuation. Yes, that's what I'm thinking. But I could be wrong because chat just having the branding, that could be it, right? It's kind of like Bitcoin being the first crypto. That had the branding. All right. I want to talk gambling for a minute. So Matt Stoller had this tweet where he says, the second fastest growing sector in America in terms of GDP growth from 2019 to 2024 is gambling.

39:59So the BLS had this report that looked at different sectors and industries and looked at their GDP growth. So the highest GDP growth was for software publishers. That was like 9 % per year. gambling was 7.6%. Now, you could say, like, what was the base, right? It's coming off of - Yeah, it's a new category. But a lot of people looked at this and said, this is horrible, this is bad. It is. It is in some ways, but don't - So, I feel like we have to segment this, because we did this early on with Robinhood, where we said, listen, is everyone on Robinhood a degenerate gambler who's just buying options?

40:30And a segment of them, yes. But are most other people using it relatively responsibly? Also, yes. And I think you have to do it with gamblers. Are there? So I disagree. Don't you think because gambling is negative some. Of course. But don't you think one of the biggest reasons is not just financial nihilism and young people who are giving up on the world? Do you think a lot of it, if the GDP growth is that much for this segment, do you think most of it is disposable income from people who are using it as entertainment who have money? Yes. Guess what? All of this money is not coming from 20 year olds.

41:01They don't have a lot. They don't have any money. They're betting$25 a game. The people who are betting the most are probably in their 30s and 40s and 50s who have disposable income. That's why this is such a growth arena. Yes. And also, I would wager, get it, that the amount of people that are ruining their lives financially and their family's lives is 50 times greater than people that were day trading. YOLOing on Robinhood 50 times because you just, it's just different with trading. You smell the roses, you take a few beats, whatever, but like gambling is an addiction. You get hooked, you lose, you double down, you go.

41:52Also, it goes to zero immediately if you lose it. Like when you buy a stock, it doesn't go to zero the next day. Correct. Options can maybe, but. So I think that, yes, are a lot of the people that are gambling doing it so responsibly with money that they can afford to lose. yeah, but I think a lot of people are getting really f***ed up. I think a lot of lives are genuinely being ruined. I don't think it's like 2 % of the people. I think it's much higher than that. If I could, I would get rid of sports gambling immediately. I think it's going to ruin the leagues in a lot of ways. I think it's horrible, especially for the people that it's too big of a price to pay.

42:25It's negative sum, and I love gambling. I enjoy the shit out of it. I don't think it's a good thing. If I had my druthers, I would get rid of it immediately. I don't think it needs to exist. It's not – society does not benefit from having DraftKings and FanDuel on our TV sponsoring commercials every 30 seconds. It just – it doesn't. All right, let's talk about crypto. I feel like a weight has been lifted as too strong of a term, but I feel much better about my crypto exposure. I got lucky with – sold into a little bounce. I sold a third of my Bitcoin at 93 ,000. I sold a third of my ETH at 3250, and I'm good.

43:03I feel like, I feel, okay, this is a number that I'm comfortable with. I've now sold twice. Last time I sold was at the peak, not to brag. Got lucky. But I feel good. If Bitcoin crashes, it won't feel good, but I'll be fine. I'll buy more. If it moons for whatever reason, I'm good. I'm there. I just, I feel better about my personal position. It's a rebalance, right? You're right size. That's the same thing I did. I feel better. Yes. Even if Bitcoin doubled tomorrow, I wouldn't regret it. no, no, I'd be, I'd be thrilled. I still have, I still have a healthy position. I'd be thrilled if it doubled.

43:37I still can't believe that it's below where I sold my first time. I, that it's so surprising to me. Uh, okay. Did mayor, former mayor of New York city, Eric Adam, like literally do a rug pull? Like what, what W two EF? Um, I sent you and Josh an image of, uh, at Helms. Wait, is that, is that a help? Yeah. From, from, uh, from the hangover in the back of the cop car, screaming what is going on. Remember that scene? Yes. So, all right, here we go. This is from Yahoo. The former mayor announced the token at Times Square press conference on Monday, saying the project would address anti-Semitism and anti-Americanism using revenue generated by the token while also teaching children, quote, how to embrace the blockchain technology.

44:22dude get right out of town what even the f and f are you talking about what the hell sort of bullshit nonsense you're making a token to fight anti-semitism and anti-americanism okay so the premise is deeply nonsensical in in the most deeply nonsensical terms possible i repeat myself So I still don't quite understand the rug. Because I saw this stuff last night. People, and obviously the crypto people can see it. Like, it's all on chain. They can see what happened. Hey, he rug pulled$3 million or something. I can't even tell if this stuff's illegal anymore. Because the Hawk Tour girl did it. And she went away.

45:03And then I guess she's just fine. She just, like, stole a bunch of money. But if you get rug pulled on this, you deserve it. Sure. If you invest in something like this, all you're trying to do is, like, catch the pot. Like, if you get rug pulled, that's on you. Listen, I, okay. Okay, I have, I'm a sympathetic. And he's a scumbag, how's that? I'm a sympathetic, empathetic person with many different things. I have no sympathy for people that lost money in this. None, zero, I'm sorry. Negative sympathy. Okay, also this guy's a piece of shit if this is true. So Yahoo says a wallet linked to him, newly launched Kripa token allegedly pocketed nearly$1 million through suspicious manipulation of a liquidity pool on Monday.

45:46The creator of the NYC token sent 80 million coins to an account that added the tokens as liquidity on a decentralized exchange. That account then removed$2.43 million in USDC before adding back$1.5 million, leaving approximately$932 ,000 in unaccounted for USDC liquidity. On-chain analytics platform Bubble Maps confirmed to decrypt on Monday. obviously more to come on this but if this is true like what a scumbag piece of garbage but i can't even tell in crypto anymore what's legal and what's not legal so i don't know what the law is but this is clearly this is a pump and dump this is this is a pump and a dump immediately what an asshole all right so let's talk real estate a little bit so i i pulled this one from the apollo chart book that you mentioned before and this this chart is kind of a face blower so this looks at median home prices by county Okay?

46:42And it segments them to three different price points. Less than$250 ,000 for median house price,$250 ,000 to$350 ,000, and over$350 ,000. So in the West, the Northeast, and the Southeast, most of the median home prices are over$350 ,000, obviously. Basically, two-thirds of the country, the median home price in these counties is less than$250 ,000. How surprising is this to you? Now, obviously you go, well, yeah, of course, no one wants to live there. Or it's cheaper to live there. But looking at the visual of this is very, it's hard to reconcile with what's going on. And this is why I said, if we just put 3 million houses out west and 3 million houses on the east side, obviously I'm overgeneralizing.

47:30Would that not just fix the housing solution? I don't know. That's a big question. But are you surprised that there are so many areas with relatively cheap housing on here? No. And this is just a great visual. This is the chart that you show people when people are yelling at each other about housing. It's like we're talking past each other. My housing situation and your housing situation and that person's housing situation have nothing to do with one another. The only thing that we share in common is mortgage rates. And even that we don't necessarily have in common because people with money have access to better rates, but it is just such a fractured market.

48:14This map is a, an advertisement for remote work moved to Arkansas or Iowa, somewhere in the middle of the country, cheaper housing. Okay. You asked me a couple of weeks ago, how is the Grand Rapids housing market doing in your area? And I get an email from like my mortgage broker through the bank, like once a week and update, Hey, Ben, and I always kind of forget about it, but this one said, hey, Grand Rapids housing market update. So I looked at it and we're one of these places, obviously. Median sale price, $345 ,000, up about 5 % from last year. Total homes sold in Grand Rapids, 887, which is down 15%.

48:47Median days on market is 19. And the supply of inventory is 1.9 months. So there's no supply. So I think the average right now nationwide is like four months or something. Median days on market is wild. 19 days. Isn't that nuts? No change from last year. So obviously, the housing market here is still pretty strong to quite strong. The housing market in my neighborhood is very soft. There's even a couple of decent homes. They're just not selling. These numbers surprise me how quick things are still going. Pretty nuts. Okay. This is a little bit of green shoots, a little bit of good news. Housing affordability index, still as low as it's been.

49:25If this is a stock chart, and I know it's not, I buy the snot out of this. It looks like it's bottoming. And then if you turn it over, you look at the average. This is objectively good news. Average monthly mortgage payment on a new 30-year mortgage is rolling over. Because rates are coming down. Yeah. And housing prices have more or less stagnated. I think housing prices might end the year up like 1 % or something for 2025. It takes a while for them to totally update. Remember a few years ago when we kind of thought the conventional wisdom was just buy a house now and refinance in a few years.

49:57it'll be fine and you still haven't been able to how are those people feeling because they've probably got a little bit of equity from housing prices rising a tad but that that has to be a pain this is such a good point right say how are those people which people which houses where do they live what does their job look like what does their family situation look like right you can't just bucket how do you're doing that way too much today you're you're not no i'm not way too micro i'm doing macro no you can't say how do people let's call up larry down the street and see how he's feeling. You can't do that.

50:28How do people who bought a house in 2022 felt? I mean, you can't. I'm sorry. What does the median person feel? Probably not great because they thought they were going to refinance. You can do it. You can't median that. I'm just sorry. You can't. I'm a stickler, I guess. You're doing way too much nitpicking today. Sorry. Okay, I didn't read Nick's post today. It's home equity fake wealth. I've got strong thoughts about this. He did a post about, is home equity fake because people say you can't do anything with it. And Nick was saying like his whole take was, listen, you can rent. Okay. And he's saying like where he lives in Jersey City, which is where?

51:05Right across the water or what? Okay. He's saying like, listen, it's so much cheaper for me to rent. If I bought a million dollar home and I paid the mortgage and I paid the insurance, the property taxes, I'd be paying double my monthly payment as I am to rent. So he's saying like, if you want to sell and rent, like that's how you lock in games. But I think this whole idea that home equity is fake wealth is such a dumb idea that people say, look, well, you can't do anything with it. You can't touch it. So it's not real wealth. Did Nick say that it's fake wealth? No, no, no. Nick is saying that's what a lot of people are saying.

51:34He, he kind of said like, here's what you can do about it. How is that fake wealth? It's an asset. A lot of people are saying, well, you can't really do anything with it because you have to borrow against your home or you have to downsize or whatever. And I think that this is just, I think a lot of people assume that spending is wealth And guess what? The lack of spending, that's the wealth. Okay? Just because you can't spend your house doesn't mean you're not building an asset and it's building wealth. Here's what you can do with it. You can use it to trade up to a new home because it'll make a new home way cheaper because you use your equity as a down payment.

52:03You don't have to save for a down payment because you have equity in your home. That's a huge asset. Borrowing against it. If you have a big project coming, do. So you don't have to sell your investments in the stock market or get out of how you'll bonds or cash or whatever. Like you can use a home equity line as a bridge loan. Like there are so many things you can do with home equity. It's a huge asset. Yeah, that's crazy, Tom. Calling it fake wealth. And it's also, the fact that you can't get out of it quickly is one of the reasons it is an asset. Like it's long-term wealth. Amen. All right.

52:36It's not fake wealth. All right. All right, let's do private markets for a minute. I did a conversation on Talking Wealth, which is a podcast I would do for advisors on GP stakes. with Todd Owens from Cantilever, which was an awesome conversation. What are GP stakes? GP stakes are investment pools. They take minority investments in alternative asset managers. It's a great business, all else equal. You are buying a piece of a business. You basically, you're being the GP. In other words, instead of paying 2 in 20, you're buying a piece of the revenue stream. You can model the hell out of it. These are illiquid investments.

53:19You have an upside call option if there's performance fees. This is a very attractive area of alternative markets. Guess what? The GPs usually beat the LPs. Almost always, right? Okay. There was an article in the Times towards the end of 2025. Investors warn of rot in private equity as funds strike circular deals. So you and I, I think we're fairly early in identifying this private equity thing. I'm seeing a lot of activity in my inbox. What is happening? It's secondaries to the new private credit. There's so many emails of secondary funds that are taking investors out of their original investments.

54:03Now, there is nuance here. It's not all bad. It's certainly not all good. I would say that this is definitely, definitely something that has my attention. I am looking skeptically. I am looking sideways at these deals. Why is this happening so frequently? How much money is stuck? So we will be talking about this a lot. What kind of discounts are these sales happening? So when I was back in my endowment days, we owned a couple of secondary funds, and they would buy them for like 40 to 50 cents on the dollar. It was a huge, huge discount because there weren't that many that happened. Private equity was so much smaller back then.

54:39I'm talking like 2008, 2009. I'm sure those secondary funds did phenomenally well, generally speaking. Because you immediately write it back up to a dollar, right? You buy it for 50 cents, you write it up to a dollar, you have an IRR already just based on the NAV, right? Yes, but - By the way, that behavior is obviously bullshit. But you buy something for 50 cents, market to a dollar, take fees on a dollar. If you're able to buy something for 50 cents, I'm sorry, it's not worth a dollar. Don't bullshit a bullshitter. Yeah, I'd be curious to hear what the discounts are these days. I don't know.

55:09All right, junk bond investor shared a chart. I believe this is from, I've seen this chart. This is from HPS. It's, I think, direct lending spreads versus broadly syndicated loan spreads. So it's basically trying to make an apples-to-apples comparison in terms of the credit quality of the underlying borrower, private versus public. Okay, so at junk bond invest, wrote 200 basis points excess spread versus syndicated loans. Here's what that 200 basis points is paying you for. can't sell it, can't price it, borrower can stop paying cash and switch to payment in kind, and you market yourself. Okay.

55:47So that's the risk premium, right? Yeah, there it is. Fair summary. So then obviously it's up to the investor. Okay. Obviously, the person with the junk bond investor handle is probably a little... Yes. Has some skin in the game there in terms of... Yes, yes. Probably doesn't think that the 200 basis points spread is worth it. Right. Okay, so Silicon Valley Bank, remember them? Mm-hmm. Did a post on state of the markets. And venture-backed companies have been in a deep, brutal bear market, like an epic bear market for the better part of three years. I don't want to say nobody talks about it. That's absurd.

56:33I don't think we speak about it a ton on this show. because it's outside of our purview. It's outside of the public light for the most part. But a lot of the mega growth funds that came in in 2021 and wrecked the markets and wrecked valuations and just turned the market upside down, like this market has been completely frozen and it's starting to heal in a good way, like genuinely in a good way. So - Yeah, the pendulum swung really wide in both directions on this. Oh. So they have a couple of charts that I wanted to highlight. One is the speed from a Series A, from a C to Series A, Series A to Series B, B to C, was happening so fast.

57:20Think about how spoiled those founders got and probably assuming this is just the way it is. Yeah, you have 24 hours. Right. You want to give me your money? I don't care. I got someone else on the street to give it to me anyway. So here's a great chart. So they're looking at the average revenue growth, the average revenue and growth for US VC-backed tech IPOs. And the takeaway is companies are bigger, but they're slower. So it shows how much revenue on average from 2010, 2013, 14 to 19, 20 to 21, 22 to 25. And it's up until the right. So these companies are much bigger when they IPO, like significantly so in terms of revenue and market cap.

58:03and the average annual revenue has slowed pretty dramatically, like pretty dramatically. 9%, not great. Not great. And then they have a great chart showing the underwriting fees and ongoing compliance costs. The underwriting fees as a percent of float for larger companies, obviously it's smaller, right, with scale, but like if you're raising$250 to$500 million, at 6%. And the annual cost, I mean, the annual costs are not nothing. 50 basis points, give or take, a little bit more. It's expensive. Going public is very expensive. Isn't it crazy Silicon Valley Bank still exists? I'm just looking at these reports.

58:49Yeah. How is that still a thing? Well, they were... Who bought them? Citizens? Citizens Bank, yeah, yeah. Alright, we had two... So it's earnings season. I love it. Very excited. We get to hear from the companies. Do you know I'm all about that? Jamie Dimon this morning. Let's see what he said. The US economy, this is from the transcript, has remained resilient. While labor markets have softened, conditions do not appear to be worsening. Meanwhile, consumers continue to spend and businesses generally remain healthy. These conditions could persist for some time. this is basically jamie diamond saying holy shit things are amazing he's like me and josh said this is a top yeah i mean obviously he hasn't sounded this positive in years yeah he's like fine things are awesome i can't i can't even lie i guess he can't can't shake it anymore maybe this is where things finally turn down um all right delta this is pretty remarkable.

59:54So record revenue, record performance for the fourth quarter, record year in 2025, even with a dramatic slowdown in foreign travel. I haven't seen the numbers yet, but pretty incredible, the consumer. All right. So they say 2026 is off to a strong start with top line growth accelerating on consumer and corporate demand. For the full year, we expect to deliver margin expansion and earnings growth of 20 % year over year. How about that? So Delta's breaking out again. You see this chart? Those are big boy numbers. 20 % margin expansion and earnings growth. Yeah, I see Delta. So these stocks were down, what, 670, 80 % in the pandemic?

1:00:44I would guess 80%. Now, Delta has separated itself from the competition. Why is Delta so much better than every other airline? It's not even close anymore. Yeah, so it is so much better than every other airline. And why is it? I can't tell you. Why are they out executing everybody else? Don't know. The planes are better. The seats are more comfortable. They have screens. It's great. It's fantastic. All right, let's talk the box office. 2025 was only$350 million below the previous year. For a kind of underwhelming year, that's not so bad. Really? I thought people said this was like a banner year for movies.

1:01:22No, it wasn't. We had Avatar. We had Zootopia. We had - Minecraft. You don't think so? Sinners and One Battle of Avatar. There was a lot of movies people talked about. No, it wasn't. I'm telling you, it was down$350 million from the previous year. This is a secular decline. I'm totally selling your theory that 2026 will be higher. Every year is going to be lower from now on. This is it, man. It's over. 2026 will be higher than 2025. No way. Sorry, man. It's done. Movies are done. I don't think you've realized this yet. They're done. Unless they double the ticket prices, movies, like as a thing, it's just, it's slow.

1:02:00It's not cyclical. It's secular. I have more experience than you do on this topic. You're blinded. You have blinders on because you go to the movie all the time. How do I, dude, the opposite. You have no idea because you have never been to the movies. I go frequently. And look at the numbers. People would rather watch a movie at home than go to the theater. It's true. It's easier. Well, of course that's true. Of course that's true. And that is already reflected in the revenue. That's not going to happen in 2026. That's been happening. 2026 is not the year that people decide to watch movies at home.

1:02:38That's been happening for the last decade. It's just slowly but surely eating away. It's going to continue to get worse. so um okay i'm on the other side of that i went to uh i took robin to see the housemaid so robin and i haven't been to a movie together since um since uh what's it called a star is born what year was that 2018 i've never heard of the housemaid it sounds like a jennifer lopez okay with all respect you can't say i've never heard of the housemaid and have an opinion on the movies. The house made... Sydney Sweeney comes out with a new movie once a month and no one cares. How wrong you are, Ben.

1:03:24So we went to the movie theater and we... So we saw... We did movie and a dinner. So I said, you know what? Let's go see the four o 'clock show. Nobody's going to be there. We'll do dinner at seven. We'll have a fun little night. and she read the book, so she was like, fine. She was actually excited to see this movie. Dude, the theater was packed. I couldn't believe it. I thought a four o 'clock showing was going to be empty. There was at least 100 people in the theater. I was genuinely shocked. I thought it was going to be empty. Housemaid box office mojo. It's got a 7 out of 10 on IMDb. That's not bad.

1:04:05Do you like the movie? It's done$100 million at the domestic box office. Okay. That's not bad. That ain't nothing. It's done 150 global. All right. So the movie, I had a great time. I had a good time. It was fun. It was a terrible movie. Terrible might be a stretch, but like it wasn't. The reading was actually pretty good. I can't believe the critics gave it a 72%. The audience loved it. You know, it was fun. I was fully entertained. Money well spent. Anyway, yeah. Listen, I'm not an idiot in the box office. I understand numbers have been down every single year. I'm just saying I think 2026 is the year that it comes out.

1:04:43One of the reasons why it was as bad as it was is because some of the movies that were supposed to come out in 2025 didn't. The Michael Jackson movie, for example, is probably going to do decent. That was punted to 2026. No, any of those biographies about musicians now, they're dead money. No one cares. I think the Michael Jackson one is going to make money. All right. If you're hanging your hat on Michael Jackson biopic for 2026, I'm going to be the winner here on this bet. We'll check back in a year. All right. Wait, hold on. Last thing, last thing, last thing on streaming. So this will kill the theater.

1:05:15Netflix, somebody tweeted that Netflix is reportedly interested in giving a 17-day theatrical window for Warner Brothers films once they acquired the studio. That will nuke. That will be the end. Like that will be horrifically bad for Hollywood. Ratings on the wall, my friend. All right, this is the blog post I've been waiting for. Why are TVs so cheap? Construction Physics, pretty good sub-sec I've looked at a few times. They do a detailed breakdown of LED stuff. And a lot of it I didn't understand, but it shows the cost of price per area pixel has fallen 90 % since 2000. Okay, so this is not just all the streamers coming in, okay?

1:05:56It says, since 2000, the story of TVs falling in price is largely the story of liquid crystal display TVs going from niche, expensive technology to mass-producing and inexpensive one. It's basically Moore's Law. It says they followed a similar path of semiconductor manufacturing. And this blog post is actually worth reading. But it says, an important driver of cost reduction has been manufacturers using larger and larger silicon wafers over time. In fact, sheets of mother glass have grown in size much faster than silicon wafers for semiconductor manufacturing. It's showing that the technology has gotten cheaper and easier to make.

1:06:23So it's not just, everyone said, no, Ben, it's just the streamers, they're subsidizing. It's not that. So my thinking was, well, why, it has to be a cost thing. So that's what it is. The technology has gotten cheaper to make and that's why TVs are cheaper. Great blog post. Check it out. Motherglass. I never heard the term before. It's basically just, it sounds like it's just a Moore's Law kind of thing where this technology has been easier to make. Good stuff. Ben, I haven't stepped on a scale in a while. I'm afraid to see what the numbers would show back at me. I've been eating, not terrible.

1:07:00I mean, I've been better recently, but like the fourth quarter was bad. I was just... through caution to the wind, whatever. Yeah. I'll eat it. Cares. I haven't started my diet yet, but I'm, I'm, I'm mentally gearing up for it. Um, and I asked Robin if the scale was broken cause I was only 176 pounds, which I was, but you know what? This is a case of the scale lying. I don't, I don't look good. Like my, my I'm flabby. My belly looks terrible. I'm fat, but I'm fat, but light. That's not really where you want to be. Are you looking for a pep talk here? What are you looking for? No, I'm just, I'm merely sharing.

1:07:34All right. Call your, call your trainer again. I can't. It's been too long. I'm embarrassed. You don't need to do, you can't do it in your house. You have to go to get a trainer at a gym. Okay. I can't go to the gym. I don't have time for that. You can make it happen. You get up early. All right. This is a sign of progress from flowing data. Number of restaurants by cuisine type since 2018. Pizzas are in a huge decline. Mexican's up. Coffee and bakeries way up. American is up. But I see this as a sign of progress. Every city you go to now has way better restaurants. They're more niche. There's breweries.

1:08:08There's all these different things. And in the past, everyone just had a pizza place to go to. And this is a sign of progress in America. It's true. That pizzas are... When we were younger, we'd go out with my dad's family in Ludington, Michigan. Where would we go? Pizza Hut. That was our place to go out for dinner with family. Aunts, uncles, cousins, everyone get together. Let's go to Pizza Hut. The Red Cups. The lunch buffet. You know, I mentioned earlier one of my bad qualities. You know, one of my good qualities. I love cities. I love everywhere I go. I'm not one of these people that's like, oh, yeah, shithole.

1:08:39I think that too. Every city I go to, I'm like, oh, I like it here. It's nice. People who argue about my cities better than yours, like, there's so many different places I feel like I could live if I had to. Like, we were in Arizona. I'm like, I could live here. You and I went to, like, Arkansas. We went to Oklahoma. Like, I could live there. Like, all these places. I love our cities. Everywhere has nice stores and restaurants now. People have, these places have all figured it out. Yeah. let's do some recommendations. Nice little country we got. All right, so I mentioned Begonia last week, but I didn't, I think I glossed over as I was giving 12 recommendations or 12 reviews.

1:09:11Jesse Plemons, my God. Now, Emma Stone was good, but he is, first of all, Ozempic, I'm guessing. No, no, no, he gained a bunch of weight for a role. Maybe he used it to lose it, but it's hard for me to believe. I don't think you ever watched Friday Night Lights, which is in the top five of my best favorite shows of all time. Was it a good movie too? I like the show better than the movie. The movie was good. But you would never watch the show and say, this guy is going to be the star that's going to come out of the show. He was pretty good. But there was so many people who were such better actors and characters in the show.

1:09:40You would never say, this guy's going to have a great movie career. Never. It's really hard to believe. When Robin and I walked out of the theater after Housemaid, I said to her, first thing I said was, I was dumber than Begonia. All right. Another thing that we glossed over. So like the Cameron Crowe book, what was it called? The uncool. That's the best audiobook I've ever listened to. It was so, so good. So the story of how he did what he did still doesn't really make sense. It can never happen today about being a kid writer for rock and roll. So one of the stories that he told was when Lynyrd Skynyrd opened for The Who.

1:10:18Could you imagine being at that concert? Him interviewing the Allman Brothers. So if you're a fan of Almost Famous, you have to listen to this because it's like an extended version of Almost Famous. I think the book is better than the movie. I love that movie. It's one of my favorite movies this century. The book is, it like adds an element of mystique. And you're right. The stories he has about interviewing Chris Christopherson and the Allman Brothers and David Bowie. And Zeppelin. He became friends with all these people at a time when, you know, the internet and social media didn't exist. And these were like the coolest people alive back then.

1:10:53And oh man, it's so good. And so then also after that, after he was done with that, he wrote Fast Times at Ridgemont High, Sean Penn's first role. And Sean Penn happened to be wearing Vans and that put Vans on the map. Right. And then also, basically, that was that he invented the teenage movie. Yes. He went undercover in a high school to write Fast Times at Ridgemont High. It was actually based on a real high school. And then he did Jerry Maguire. That's the best audiobook I've ever heard. And him telling the stories himself and like using inflections and accents for voices. And it's so, so good.

1:11:27All right. But the other book that I just finished, and this was a thick book. Can I say this was a thick listen? How about you say it was a long book? A long listen? So James Andrew Miller, he wrote the book about ESPN, These Guys Have All the Fun. I didn't read that book, but I asked you - I love that book. Is this book in the same format? So I just thought that this was a book. And it was technically a book, but it was all interviews. interviews. I like books in that format. Yeah. The entire book was interviews and the book, what is it even called? Hold on. CIA James Andrew Miller. So the book was called Powerhouse, the untold story of Hollywood's creative artists agency.

1:12:15So it was a story of Mike Ovitz and his partners who created CIA. He was the most powerful man in Hollywood. And what a personality, what an unbelievable. What an unbelievable personality. I don't know what else to say, but this, this was like the book, this was the story of Hollywood through interviews. And it was, it was dude, it was everybody from Barbara Streisand to magic Johnson, all of the partners and everybody involved, Sarah, Jessica Parker, Matthew Broderick, like Stallone, De Niro, Scorsese, everybody was interviewed for this story and it was unbelievable. Like cannot, I love Hollywood stories.

1:12:55I mean, it could, cannot, cannot, cannot possibly recommend this highly enough. The personalities, the business, this, I mean, just on unbelievable. Um, so two what ifs from, from that book that came out, they want it. Stallone got the script for Beverly Hills Cop and he, he hated it and he wanted to make changes to it. He wanted to rewrite it. And they're like, all right, dude, this is just not for you. Way worse movie with Sly Stallone. Of course. But what a crazy what if. Can you imagine Sly Stallone in that Detroit lions jacket like Murphy? no, it's just, it's not, it's not, doesn't work. Here's another one that totally, totally doesn't work.

1:13:31This just sounds so weird. Uh, Lovitz, John Lovitz, his name is John, right? John Lovitz. Yeah. John Lovitz, John Lovitz and Dana Carvey. They wrote bad boys for them. That's kind of funny. What? Yeah. That's a different movie. That's a very forgettable. I mentioned this to you, like the story about, about Farley and his last days and, Just an unbelievable. This is a lesson. I'm going to say if you ever wanted to listen to a book and just see what it was about, you're not reading this book. It's absurd. I don't know how many pages it was, but it's a 15-hour book. This Audible section is just you and I giving each other recommendations now.

1:14:07Pretty much. Nobody else is listening. All right. Last thing. Oh, Industry is back. I freaking love that show. You watch Industry or did you fall off? I fell off. It just got too much. It was too over the top for me. Okay. It is highly, highly over the top. I liked it. The over-the-top stuff, I feel like if they just calmed down a little bit, I can't handle it too much. Okay, the over-the-top stuff is gratuitous. But hey, I'm a sick puppy. I like it. Is Landman the best, worst show on TV? Okay, I had a Landman. I talked about it. If it didn't have Billy Bob Thornton in it, it would be unwatchable.

1:14:42Because it feels like everyone is in their own TV show. The mom and the daughter are in a different TV show. Like, they're in a sitcom. The son and his girlfriend who had the guy die and they got a baby. That's a totally different show. So if it didn't have Billy Bob as the glue holding all together, he's so good. And because this season sucks. I mean, I, I, I'm not enjoying it any less, but objectively nothing is happening. It's, it should be boring. And yet, and yet Ben, every time the credits come up, I'm like, shit, that was 50 minutes. Yeah. It's, it's just Billy and Sam Elliott too. But, um, the Demi Moore plastic surgery totally takes me out of every scene.

1:15:16It's, uh, it's hard. Anyway, uh, my sister sent me this thing. Billy Bob lost his brother at an early age. and he talked about grief and how he channels it in his acting. And he said, if I ever seem sad or melancholy, it's because I am. But he's like, I use that to remember my brother, but I also use it in my acting. He's a really thoughtful guy. I really like him. Okay, I have my best picture of the year nomination. This is Ben Carlson only. For 2025? For 2025. Sentimental value. Train dreams. No, train dreams was. It got displaced. That's number two. okay okay um as we know uh the leo movie bottom of the list sentimental value so this is the same people who made the worst person in the world this is a norwegian filmmaker okay they made this movie and it's the same writers same directors it's used the same star this person you like worst person in the world i really like that movie that's really it's stuck with me i really liked it oh i feel like that's not a you movie okay so you so you watch that one so this is the same the same girl actress as the lead.

1:16:22Stellan Skarsgård, who you've seen in a million things, is in it. And then Elle Fanning is also in it. Is this nominated or this is a personal Ben Carlson nomination? It should be. I would imagine it's nominated. I can't believe it wouldn't. I don't get really good critic reviews, but it's very good. And here's the thing. So half of it's in English, half of it is in Norwegian or I don't know what. And so most of it's subtitles. And I used to hate subtitles, but now it makes you lock into the movie. I can't be on my phone. It makes you watch it. And it's just a very, it's a story about a daughter and a dad and the dad kind of, he divorced the mom and kind of wasn't in the girl's lives.

1:16:58And it's them working through the relationship and it just feels real. The whole, it's really well done. And the funny thing is, even with a different language, most of the time, I can still tell that this actress is so good at what she does, even though I can't, you know, understand everything she does except through subtitles. It's very good. That's the Ben Carlson film of the year. Best picture. Wow. Okay. This is a dumb question. I assume that should I watch it? You won't like it. You won't like it. So, like, I won't like it. I shouldn't watch it. Did you like Worst Person in the World? If I'm thinking of the movie, yeah, I liked that movie.

1:17:28I mean, I didn't love it. If you liked that movie, give this a try. I think this is better than that. I like this more. Wait a minute. But it's called Sentimental Value. I did not see this movie. Nope. I was thinking of something else. Okay. I wouldn't imagine you've seen it. I really liked that one. I think this one's better. All right. I'm out. Yeah. Thank you. No, not a Michael movie. Okay. Anything else? What a crazy week, huh? It was. And yet, the market seems to strong it off. Not yesterday. The stock market is invincible. Oh, boy. Sure seems like it. Yeah. And then we're going to get a fair market to it anyway.

1:18:11The stock market will never go down. Ever. All right. How about this? The stock market will go down. It will always come back. Heard it here first, folks. Guaranteed. Animal Spirits at the compoundnews.com. Check out Talking Wealth. People say, hey, you guys don't plug it enough. Talking Wealth. Subscribe to the newsletter if you're an advisor. Watch the shows. It's good stuff. See you next week.

1:18:47The Insolvenzantrag is set. And suddenly everything is in all-tempo. For our protagonist, the hardest phase begins. In Folge 4 of our series Endstation Insolvenz show we, why Openness is the most important thing. Why a Insolvenz-Werr is not a Gegner. And how a Betriebe stabilizes or is a stable.

1:19:14Kreditreform. Überall, wo es Podcasts gibt.