Never Go All in on Stocks (EP. 437)

22:49Yeah, no, you're right. There was a really good story in the Wall Street Journal about kids versus adults and basically saying things are way better. So it's the economy that's great for parents, lousy for their grown-up kids. And they go through all of these different stories about the parents who are doing well. They have home equity that's up a ton. Their stock portfolios are up a ton. They have kids who are graduating with PhDs and these different jobs, and it's hard for them to find a job. And they look at the survey result, and they looked at people like themselves, the baby boomer parents versus their children, and can keep up with expenses, have enough money to buy a car, pay an unexpected medical expense, buy a home, find a good job.

23:30And obviously, all the older people, the parents, have way higher responses than the kids, right? It's way lower for the kids. Do you think it's ever not like this? I wanted to have two things here one, it's a tough job market for some people especially college graduates two, suck it up I had a terrible job experience when I first came out of college I think the difference between now and any time in history before this today people want others to feel sorry for them it's not just recognize the fact that there's a tough whatever it's tough to buy a house, it's tough to find a job I need everyone collectively to agree that they should feel sorry for me.

24:12I don't think we had that when we came out of a tough job market in 2008. What was unemployment in the GFC? Did it hit almost 10 %? It was 10%. That was the high. Yeah. The unemployment rate is 4 % right now. So yeah, there's pockets of like where things are starting to get bad. Imagine millennials complain. Not imagine. We did. I mean, I had no way to complain because I was an idiot. But millennials that did the right thing in college, complaining about not having a job when grown adults were getting laid off in their 40s. It's like, shut up, kid. I have kids. That's the thing. We didn't get in.

24:43No one gave any sympathy to young people back then. That's all I'm saying. So I think that, listen, of course, I am a sympathetic person. I don't like to see this. It is weird, though, because on the one hand, younger people tend to be more optimistic than older people. I made this comment to you and Josh last week. I feel like it's always been younger people have this optimism. And today I feel like it's getting broken. All the young people, they're way more pessimistic and cynical. And I think it's just because they grew up with the internet and social media. I don't think they had a chance.

25:14So young people have way less optimism than they did in the past. They're way more cynical. Are young people, this is a dumb question, like are young people on Twitter? I don't know. They're on TikTok and I don't know. I feel like it is more of a middle-aged, Gen X, late millennial thing for most people. But I do think you hate talking about demographics, but I do think the demographic stuff in the years ahead is going to be the divide between the demographics is going to be worse than ever. So Eric Finnegan from John Burns sent me every six to 12 months he sends me his demographic presentation that he does.

25:48And I pulled some charts here. And the thing is, part of the difference now between young and old people is part of it is things are just, you know, they are harder in some instances, but some of it is just life choices. So you look at annual birth by mother's age, and it's under 30 versus 30 plus. And for the first time ever, more people are having a child plus 30 than below 30. Never had, right? So it was way different back in the 70s, 80s, and 90s. Of course, this one, this is probably the one that gets people the most, is that the first time homebuyer is 38 years old. It really hasn't budged off of like 30, 31 since the last few years.

26:28but you have the largest population group this year is turning 33 to 37 if you break down the demographics into these these cohorts of like four or five years i think that's part of the reason that it's causing this there's so many more of these 30 old people than ever before this is like the rabbit going through the snake right now it's young people and this one gets people too so this is americans reaching other typical adult milestones later in life so this is percentage of 30 year olds living on their own, married with a child, own a home or have a bachelor's degree. And bachelor's degree is obviously the only one going up.

27:00And that's part of it too, why people are putting off this stuff to later in life because they're getting more education. And how many young people these days want to even settle down? I think a lot of it, this is life choices too. You think this is like a structural thing, not just a real estate thing? I think this is, I think part of most of this is structural. Obviously this is the worst time ever to be a first-time homebuyer. But I think a lot of this is life choices too. People are going to school longer. They're waiting to settle down longer. They don't, a lot of people don't want kids till later in life.

27:28They want to enjoy it. Whereas in the past, it was like, eh, let's just do it. Everyone else is doing it. So anyway, I just think the demographic like divide though is, and it's also, we talked about the luck of the draw thing with Jason Zweig and when you retire. A lot of the luck of the draw thing is going to be, do I have rich baby boomer parents or not? Can they help me with a down payment? Will they give me some money or will I get an inheritance from them someday? I think that's going to be luck of the draw too. Did your parents say, were they fiscally responsible or not? Does that, some of the people, that's their retirement plan.

28:02We've talked about this. Anyway, you hate generational warfare. I think it's going to be worse than ever in the years ahead. Not going to get better. It's going to get way worse. Yeah, not my favorite topic. Okay. Okay, I shared this with you on Slack this morning. No, you know why? Because it's just like a bummer. I don't like that stuff. It is a bummer. I totally agree. And I just don't see it getting better anytime soon. Because I was, you and I probably are in a similar boat here. I was so naive to the world around me when I was younger, in high school and college. I knew nothing besides what was going on in like, I had the blinders on.

28:39I didn't pay attention. I still remember when we had the Bush-Gore election, me and five or six friends went to a house of our friends that had a party house because we were i think we were freshmen in college we watched the election i don't even think people talked about who they wanted to win no one really cared we stayed up till three or four in the morning they still didn't name a winner and we all went home and guess what we never talked about it again after that once we didn't it never once came up in conversation yeah if you asked me i mean i was a little bit younger but whose policies do you like better i would say uh yeah sure the guy with the a young person, you know everything down to a T about these politicians, and you're paying attention to this race in Iowa and this race in New York, and like, that stuff just didn't, wasn't on our, maybe that says more about me and my friends than anything back then, but I think that was more people, right?

29:28We didn't have to care as much, and today, young people feel like they have to know everything that's going on. All right, so there's this viral thing going around lately, saying from Moody's, the top 10 % of earners account for 50 % of consumption. We've talked about this a lot. This guy from University of California, this economist, what's his name? Antoine Levy. Yeah, Levy. He says this, this isn't, this stat isn't right. It can't be right. And he says the biggest reason is rich people pay higher taxes. They have higher savings rates. So he kind of backed into this and said, if you look at just the fact that people pay high at rich people for higher taxes.

30:06He's saying, I think some of the numbers are kind of, it's not like Moody's is fudging these numbers, but they're not exactly accurate. He said the number is probably more like 35 to 40 % of consumption. That's still pretty high. I mean, does that change anything in terms of how you perceive the data? The trend is going higher, but the funny thing is, is that the 50 % number, no one even batted an eye because it just seems like that's what it should be. You're right. And maybe that the point is the trend is moving higher. And even if it's not 50%, the thing is the top 10 % does account for like 50 % of the income in this country.

30:40We were talking with Stephanie Roth last week on TCAF about why a lot of the spending wasn't impacted by higher interest rates. And it is the top 10%, the top whatever percent, their ability to get alternative financing at lower interest rates and not have to slow down their spending is a structural change in the market. And I don't know what slow is that other than something, a credit event or something with the labor market. But even then, a lot of these people are, I mean, it's certainly the retirees are insulated from the labor market. Now, if there's a big labor market impact, the stock market will come down and it's circular logic.

31:14But the stuff that we're seeing, the wealthy people have never had more options than they do today in terms of trying to manage their taxes or borrow money against financial assets. Yeah. There are so many other strategies. Yes. That wealthy people have that you're right. They were kind of like the MAG-7 companies that didn't get impacted by higher rates. It was the same thing. So here's the other side of the equation. From Apollo, 25 % of the U.S. population has a subprime credit score. That's pretty gnarly. So what's the number on that? I guess— 680, I think. 25 %? That's kind of nuts, right?

31:54No, that sounds right to me. Honestly, I mean, if you think about it, not everyone is in a mature financial position. Think about how many young, I said the biggest cohort in the country right now is 33 to 37. How many people come out of college and their finances are awful? Is there a way to see your credit score over time? I would love to chart mine. That's a good question. I don't know how that works. So you think that when you first graduated from college and you're working as a waiter, your credit score was negative, essentially? I know it was. So the first job opportunity, the first real one that I had, I've told this story before, but it was at E-Trade in Garden City.

32:35And the guy gave me an interview and was like, yeah, you're going to take over a book of whatever it was,$100 million, and you're going to talk to these people, and you're going to try and upsell them. And you have a base salary of$60 ,000 with some opportunity to make more. And I was over the moon excited. at that point I had been unemployed this is probably 2010 11 so I was unemployed for like two and a half years like literally unemployed my I was twitching I had an eye spasm for two years um because I was so upset and anyway where am I going with this credit score right so I didn't get the job because when they were doing their background check on me they found a ding in my credit report and in the interim the guy that hired me left and the new guy who replaced him brought in somebody else so yeah my credit score sucked and impacted my job my life in a serious way it is it can it can tens of thousands of dollars over the course of your life maybe hundreds of thousands if you had a good credit score by the way well for me in the opposite direction because my career trajectory would have been that's what i'm saying it can it can totally change your, yeah.

33:45But thank God my credits suck because otherwise, who knows where I'd be? Not here, not talking to you, Ben. Okay. There are those forks in the road, right? Yeah, that was a major one. Yes. It is, this is something I would also tell young people. There are times in your life when you don't get a job or things seem really bad. I had many of those and I thought the world is over. This is it, the end of the world. And you look back at those and you go, gosh, I was so lucky that that thing didn't work out for me. Oh yeah? Did you ever apply to the Bermuda Monetary Authority? Things that bad for you?

34:17I lost a job once because I was trying to move to Chicago. My brother had a condo in Chicago and I used his address. And they were sending all the correspondence to him and somehow he never got it. And I found the email and I said, I haven't heard back from you. They said, hey, we offered you the job. But he never responded. Yeah, that was a low point. That wasn't great. I think I went straight to the bar from there. Anyway, guess what? It worked out. I would have been miserable. It was like a real estate analyst job. It would have been awful. Wouldn't have worked out good. All right. Let's talk tariffs for a minute.

34:50We've had lots of conversations about why aren't tariffs having a bigger impact? From the Ramp Economics Lab, R. Karazian has this great sub stack. And he said, why are tariffs so confusing? This is the big thing. So Ramp is this company that helps people pay invoices and automates a lot of the financial decisions. So they have a ton of data to come from. So he said ramp data from manufacturing retail sector invoices shows a slow and gradual increase in tariff costs. The share of bills and invoices showing a tariff charge has doubled from 1.4 % in 2024 to nearly 3 % as of 2025, September. So basically saying it's still a very tiny number.

35:25So he goes through this whole thing in this and it's worth reading the article. But he basically says if you just looked at the announcements, you'd think, oh, my gosh, this is unbelievable. But if you look at the actual numbers and how many companies are actually paying tariffs or consumers, it's way smaller than the announcements. So companies are finding ways to skirt around these. They're not paying them. It's not having an impact because people aren't – the tariffs aren't being paid as much as one would think. And we actually have a podcast. When is it coming out? Saturday, maybe? Saturday.

35:53Okay. All right. So we have a podcast coming out with him talking about this and AI, and it's really interesting stuff. So it should be out soon. All right. On the AI front, we talk as stock market people. We talk a lot about the market cap, the tweets, the charts, whatever. And I don't think we spend enough time talking about the underlying fundamentals about what's actually happening. So our friend Michael Sijmore has a great sub stack and podcast called Alt Goes Mainstream. And in the most recent edition, he wrote about what Meta is building in Louisiana. the Hyperion thing, that they're doing this interesting financing with Blue Owl and Pimp Gun, everything else.

36:40It's 4 million square feet. It's a 4 million square foot data center that's being built in Louisiana that will deliver over two gigawatts of compute capacity to train future open source large language models. So for context, five gigawatts would be enough to power the entire city of Miami. So when you talk about the infrastructure, the data center, the CapEx bubble, this is where it is. You know, it is kind of funny. This is kind of a gotcha thing. But you could say, like, there's people who have been pounding the table and screaming for years. Like, why don't we build anything in the U.S. anymore?

37:17And they're probably the same people going, why are we building so many data centers? Now, you probably say, like, why can't we just build more houses and stuff? But this is one of those things that you're right. We're actually building stuff here. And this is actual stuff that's going to matter in the future. So they say McKinsey projects that these data centers are projected to require almost$7 trillion to keep pace with the demand for compute power. So if that is even remotely within the realm of what happens, where you're seeing$6,$7 trillion being spent over a given timeframe, and ostensibly the spend is because there's revenue tied to it such that the investment makes sense.

38:00if you get those sort of numbers, then looking at it today, it's not outlandish. I mean, it's, it's hard to, it's hard to think about numbers of that size, like of that scale. So for example, all right, let me put this in the doc. I had ChartKid make this. So we looked at Apple reported last week. We looked at all of their different segments and Apple, I think that Apple cost $4 trillion? Yes. Okay. Which is funny because Apple didn't get into the AI stuff at all, and they're still at all-time highs and still$4 trillion. All right. The iPhone over the last 12 months has done more in revenue than Bank of America.

38:43The iPhone has done more revenue in the last 12 months than Meta. All of Meta. All right. That one surprises me. And I do kind of get it, though, because my wife and I have both lost phones in the last year, and it's not cheap to replace. I will say that. Services, which is the bell of the ball. This is the highest margin business. This is pushing their margins to an all-time high. Services business did more revenue than Target,$109 billion. If you look at the wearables, okay, the freaking wearables, dude, it did almost as much money,$36 billion, as Starbucks, which did$37 billion. Starbucks has 80, 40 ,000 stores globally.

39:25I mean, Starbucks, it's Starbucks. Salesforce did 39 billion. Okay. Um, turning to the Mac, the computer, the Mac did more revenue, 34 billion than Schwab. And lastly, the fricking iPad, the iPad. I know I'm saying it's not for three times the iPad, which in my mind, I don't know what I would have guessed. I pad is. I would have guessed 5 billion,$10 billion. the iPad did more revenue in the last 12 months than AMD. That's a good chart right there. And they're buying back$100 billion of stock a year. So I guess that I was going to get to this in a minute, but there was a chart. My point is we're not even pretending to zoom in oftentimes when we're having these conversations.

40:14And when you do, when you look at some of the numbers, it's like, all right, I guess. So there's this number, this subset called understanding AI. and they show that the operating cash flow versus capital expenditures. And so this is for Google, Amazon, Meta, Microsoft, and Oracle. And the operating cash flow is still, there's a huge wide gap between, there's more than enough cash flow to cover all these capital expenditures. And to your point with Apple, it's because they make so much darn money, these companies. And they're not even listed on this, obviously, because they're not getting into it.

40:46Okay, that's good stuff. I'll give you that. All right, I want to play this video. Yeah, let me share my screen. Okay, somebody tweeted this from Neil deGrasse Tyson. Did you see this, Ben? No. Okay, here we go. I've been doing calculations, as well as looking back at old NASA footage and raw data from satellites hovering above Earth. And I just can't escape the conclusion that the Earth might actually be flat. That's not me. It was never me. Those aren't my words. That's what's called a deep fake. How wild is that? So wait, the earth really is flat? Yes, that's what I'm trying to. So boomers are going to get scammed into the stone age.

41:33And not just boomers. I got a call a couple of weeks ago. I was with Chris, actually. Somebody from Germany was trying to log into my Google account. I got a push notification on my phone. I hit no, obviously. Ten seconds later, I got a call from Google. Right? It says Google on my phone. Now, Google doesn't call you, okay? But I was like, wait a minute. What? So I was getting scammed. Thank God I hung up the phone. But that doesn't even scratch the surface. Like that Neil deGrasse Tyson video and what's coming is going to make the crypto scams look like what? Look like my brain is breaking it.

42:10What does it look like? A walk in the park? Sure. Let's go with that one. Isn't this, can't there be a whole industry that crops up because of this though? Like we're going to be the ones that tell you what's real and what's fake. Well, I guess that's what... Life lack or whatever. By CrowdStrike, for example. Like these cybersecurity companies are the obvious secular winners for the next decade. But it's wild what's coming. Okay. I got a data set one for you. This is also my understanding AI. It shows data centers are catching up to offices. So it shows annual construction spending for data centers and other offices.

42:45And data centers is almost closing the gap to be bigger. Here's what I want to see from the Wall Street Journal. There has to be a story of which construction companies are getting rich off of this. There has to be someone who is other ancillary benefits to people who are working on these data centers and making money, right? There has to be other outside impacts besides just the tech companies. This is helping someone. Who's getting these contracts? Yeah, that's a good question. And I mentioned this to you and Josh last week. We talked to a farmland manager who said, because farmlands tend to be by resources that have a lot of water, farmland investments are now getting bid up and farmers are making money because they're trying to buy these data centers or build the data centers on farmland because it's so close to water because they need the water.

43:31There's going to be so many knock-on effects like that. Again, people are probably mad like, wait, the build-out of the data centers is taking away construction workers from building other offices and building houses and blah, blah, blah. But I still think the fact that we're building this stuff in the States, that's a net positive for us. Yep. Lots of jobs. All right. I want to talk about AI and jobs. So this is from Wall Street Journal. Tens of thousands of white-collar jobs are disappearing as AI starts to bite. By the way, Derek Thompson tweeted, Derek Thompson made this chart like two weeks ago and everybody's stealing it.

44:00Which one? This one. Okay. So this is the S &P 500 versus total job openings. And it shows when chat GPT launched, job openings crashed. I'm sorry. This is a massive chart crime. Massive. this if you're trying to say that chat GPT coming out is causing job openings to fall that quickly this is the Nicolas Cage thing, the number of people who drown in falling in a pool versus films Nicolas Cage appeared in, this is total correlation causation and this is a massive chart crime you cannot tell me okay, AI is going to have an impact on white collar jobs, yes, it did it immediately when chat GPT launched, come on Give me a break.

44:43This is a chart crammed to the nth degree, correct? Straight to jail. Well, two things in this chart. Number one, the blue line artificially got inflated during COVID, right? Jolts. That's the thing. This is part of the 2021 job market slowing down. Yeah. And then also, you know what else happened when ChaiJPT launched? Or I guess before when the blue line actually peaks? Hmm. Was there a tightening cycle? I can't remember. Exactly. Everyone, the company is overhired. They raise rates, all this stuff. Yeah, nonsense. Is AI going to have an impact on jobs? Yes. Is it already? So John Lettieri put this thing out.

45:22And there's these things like Amazon, what did they? They let go 35 ,000 people. And you say, oh my gosh. But he looked at just in the fourth quarter alone, 7.5 million private sector jobs were destroyed. In the fourth quarter alone of 2024, okay? Job gains, 7.7 million. Like there's so much churn in the US job market because there's so many people and so many workers that like these numbers, you have to put them into context sometimes. For sure. The unemployment rate is still 4.3%. Although I guess we don't report it anymore. Maybe it doesn't count. I know AI is going to have an impact. I don't see how you can say that it's having this big of an impact yet.

45:58That's my whole point. I think people need to calm down a little bit. It's a truck run. All right, where are we at? All right, let me, if you would allow me to take five minutes on strategy. All right, so the company formerly known as MicroStrategy reported earnings this week. ChartKid made this looking at the ratio of strategy to Bitcoin. And this peaked a year ago, actually, in November 2024. And it has been straight down for the last, really since July. It's been acting really funky in a bad way. The next chart shows the value of their Bitcoin holdings compared to the market cap. and people are hemming and hawing a year ago.

46:44Why are they getting such a premium? Well, guess what? That premium collapsed. Matt also showed the market cap value divided by the Bitcoin holdings value, and it peaked at like 3.5 times. It's now 1.2 times. Now, there's a lot of different reasons for this. I think the primary one would be that if you wanted exposure to crypto in a brokerage account, particularly levered exposure, before all of the ETFs, before all the other treasury companies, this was the only game in town. Um, so the, the earnings call itself, it's an, it was an hour and 50 minutes. There's 92 slides. Now to me, I know a lot of people don't care about this, but to me, you're listening to this whole call.

47:21No, no, no. I listened to a lot of it, but I, not all of it. It was Friday at four o 'clock. I said, I think I'm, I think I'm done. Uh, 92 slides, hour, 50 minutes. I've never seen such a thing. And one of the things that they talk about was, um, them getting a credit rating. All right. So this is Fong Lee. he is the president and CEO. I'm going to play this at 1.5 times speed. So if you're already jacked up to two, this might sound like a mouse. So you might want to slow it down. All right. Here he is talking about the S &P rating. Or pools of capital. So what does it be? S &P, S &P minus, issue a credit rating to strategy.

47:56And we think this is a big milestone, not just for strategy and for Bitcoin treasury companies, but a big milestone for Bitcoin in itself. There's been a lot of discussion around whether we think this is a good rating or not a good rating. I think it's a solid starting rating. and I think even more importantly to have a rating and gives us access to more pools of capital. So what does a B minus rating mean? By definition, it means that there's a stable and reflects the expectation that we'll continue to manage our capital structure prudently and that we maintain market access. Ooh, and BFI, keep going, Fong.

48:20We were rated under a structure, a framework that's called non-bank financial institutions. That's a framework that the S &P uses to rate us. And importantly, at this point in time, Bitcoin is, we don't get any credit for the Bitcoin on our balance sheet when it comes to our rating. It's deducted from our equity. I'm not sure that they should get credit, but they think so, but all right. All right. So here is Michael Saylor himself. Now I will preface this by this man is extraordinarily intelligent. IQ off the wazoo. And also there's a fine line between genius and crazy, respectfully. I mean, this sounds, this sounds nuts and maybe I don't get it.

49:00Maybe I just don't. Um, but here's Michael, listen up and, uh, well, tell yourself what you think. Here we go. The second innovation is where we're replacing traditional risk with digital risk. Traditional risk. It's opaque. It's heterogeneous. It's discreet. You own 8 ,700 houses or you own, you know, you're exposed to a portfolio of 47 junk bond issuers. Uh, and maybe they're fine, but then there's a tariff or there's a trade war or there's a competitive change, or maybe there's a strike or maybe an airplane crashes, you know, or there's a COVID lockdown. Whenever you have these kind of conventional real world issues, you have a discrete explosion.

49:36I don't know how that wouldn't impact heterogeneous or not. And I'm not quite exactly sure what that means, but I'm not sure why Bitcoin wouldn't be impacted by any of those risks that he highlights, but who am I? Or changing customs duties. So traditional risk is opaque. It's heterogeneous. It's discrete. On the other hand, digital risk is transparent. It's homogeneous. It's continuous. You can go to our website and we update the risk model every 15 seconds. And so it is completely continuous. We update the price of Bitcoin. We update the volatility of Bitcoin on a continuous basis. We update the BTC ratings.

50:10You can plug in your statistical models into them. And of course, all the risk is based upon your outlook of BTC AR, BTC vol, BTC price, and BTC rating. So digital risk is something where you don't have to wait for a year for a credit rating agency to publish a new report to tell you whether your favorite airline or your favorite restaurant chain is riskier or less risky. with digital risk, you can literally plug into the website and you can recount. Now there's seven innovations. That was merely about one of seven. I know a lot of people that are listening like, Michael, please, enough. I don't care.

50:39Well, I care. I think this is one of the most fascinating stories in the financial markets. Michael Saylor has generated a lot of buzz, raised a lot of capital to power this perpetual money machine, had a lot of success up until, I guess, the peak at the end of 2024. It's been certainly a rough 2025. Can he get his mojo back? Are buyers buying what he's selling? Is raising capital a business model? The FT did a good piece on the credit ratings of strategy and what it means. And they said, what makes this episode remarkable, this is the FT, is the companies craving for validation from the very TradFi establishment it claims to reject.

51:26Strategy presents itself as a bulwark against the debasement of fiat currency, yet it seeks legitimacy from two of the oldest and arguably most discredited pillars of the ancient regime, sell-side equity research analysts and credit rating agencies. And that's not even mentioning the palpable desire to gain membership in the S &P 500. The company's pursuit of conventional approval, but trays more than a little self-doubt about its own purportedly disruptive project. So one of the interesting things on the call is what they're doing, and I mentioned this last time, with their four different preferreds where they're trying to strip out the volatility risk and like somehow shift all of it into the dividends of the preferreds or the interest payments, whatever.

52:05And he talks so fast and it's just like, it's hard. Honestly, because he's so much smarter than I am. I'm picturing you in your mudroom as Charlie Day from It's Always Sunny with the lines and the pictures. Yes, I can't. I honestly can't. Daniel, make that one happen for me. Make Michael as that guy. I can't keep up. So then the FT goes on. The last thing, then I'll stop here. Actually, that's not true. One more thing. The FT says, the company argues that its$71 billion treasury of Bitcoin offers a massive buffer of collateral to service its obligations. But this exposes what S &P calls a currency mismatch between strategy's dollar-denominated liabilities and its Bitcoin-denominated assets.

52:44Fixed income investors take on the risk of this mismatch without sharing in the Bitcoin upside, receiving only a dividend while being exposed to potentially ruinous losses. And as S &P notes, if strategy were forced to sell Bitcoin to meet its obligations, it would likely occur during a downturn precisely when the collateral is losing value. I did forget one last quote that I wanted to highlight. An analyst asked him about price action. Now, this was last week. Bitcoin had been in a pullback, but things have accelerated to the downside this week. But he didn't really answer the question. At least I had trouble finding an answer in here.

53:24But let me know what you think. Or again, let yourself know. I think Fong highlighted some of them in the discussion of S &P credit ratings issues, right? The fact that Bitcoin is not viewed as capital by the traditional credit ratings industry. So I think the view of Bitcoin and the collateral value of Bitcoin and the traditional views under Basel rules, under the rules that govern our banking system, our insurance companies and our credit rating agencies. I think that that's a structural thing. You know, like when FASB didn't allow you to recognize gains, but they made you recognize losses and you had indefinite and tangible accounting, that was pretty crippling.

53:59I think that we fixed that. And I think that fixing capital risk rules will be a big one. I think the second is banking acceptance, custody and credit, banks issuing credit on Bitcoin. So we're hearing rumors and we've heard that a number of major banks in the U.S. in the first half of 2026 will start to buy Bitcoin, sell Bitcoin, custody Bitcoin and issue credit and margin lines against the native Bitcoin asset. That will be great for them. That will be great for Bitcoin. That will be great for us. That will accelerate adoption. And so I would say that neither of these are things that I would ask for government help.

54:35All right. So I didn't really hear an answer there. I think it's as simple as the market for now is no longer buying what strategy is selling. Maybe they can get their mojo back. We'll see. Time will tell. And forgive me if this is of absolute no interest to you. I can't take my eyes off of it. I tuned out a little bit ago. I know. It's okay. It's okay. No. Let me ask you a question, though. Are you saying, look, so Bitcoin is 108 ,000 now. It's up 15 % year to date in a very risk-on environment when the dollar is getting crushed, right? If I'm a macro person, here's the Winnie the Pooh meme. I just put it in the doc for you.

55:10This is a new macro thing. Stocks are an inflation hedge. First Winnie the Pooh. Second Winnie the Pooh, stocks are a debasement hedge. That's how you macro right there. That is good. Are you a little surprised Bitcoin's only up 15 % year today? Because I kind of thought once it hits 100, like, oh boy, who knows? I'm kind of surprised that. Now, to be fair, it's up 60 % over the past year. Well, sentiment in crypto land is like in the toilet. it. So, I mean, and I do think gold is a big part of that. The fact that gold is going nuts, I feel like there has to be some envy from the crypto people this year going, oh man, gold is doing what we thought we were going to do this year.

55:44Listen, I don't think any, I don't think any crypto person would say that they're like, now there's like, there's very, there's hyper rational, logical, sensible people who are like, guys, calm down, zoom out, 110 ,000, like chill. It's not going to go up 70 % a year. It's a major asset class at this point. Like everybody needs to pump their expectations. Yeah. Like I said, it's up 60 % of the last year. Just this year, 2025, if you're looking at it in a vacuum, Bitcoin is kind of just middling. No, it is middling. Absolutely. So given the backdrop, given gold, given Mac 7 names and a lot of the speculative names like the Oclos of the world and the quantum stuff, you would think that Bitcoin should be doing much better for sure.

56:19That was Yeoman's work there. How do you say that word? Yeoman? Sorry. Yeah, I know for a lot of people, they're fast-forwarding or just ending the episode. It was an interesting story. All right. You've been on it too. So the K-shaped stuff. This is from NAR. Let's get to housing. They look at the, they do this on an annual basis. Change in sale by price range, year over year. This is a number of sales, not like how much it went up. The biggest cohort that's getting more sales is the million dollar houses. 20 % of the total now. Whereas under 250K is 8 % of the total. More houses are selling for a million dollars or more than any price right now.

56:54which is kind of insane when you think about it, but that's kind of our new reality. Yeah, I bet it also. It's insane when you think about it, but then it makes a ton of sense when you think about it. The people who are able to buy houses, like you said, don't have to worry about much about traditional financing. They have portfolios that they can use. They are buying the higher priced houses. Yeah, they're not worried about mortgage rates. They have home equity they can use. I don't know. I don't think a lot of people look at this and go, oh, this is great. Awesome. them ben you know great you know the you know the line in um in naked gun the late leslie nielsen says something like he's driving with uh with ed the big guy and he goes everywhere i look i'm reminded of her you know i'm talking about yes so there's a phenomenon i watched the new one i'm going to talk about my recommendations okay there's a phenomenon and it has a name i can't remember what it's called where like you buy a car or you get a dog and then you like you see them like you've never seen them before.

57:48Yeah, right. Yep. So that's happening with me now for the Dan Wang book that we keep talking about, like the lawyers versus engineers. Now, it's so obvious in this article because it literally, this is what the article was about. But this guy, Michael Riley, does, he covers DC. That's his beat for Bloomberg. And he wrote a really good profile on Oclo and the history of nuclear and funding and the mismatch between venture and the industry and all that. It was really well done. So they spoke about this guy who is an early investor in Oclo and his whole strategy was basically to replicate the Uber playbook.

58:29Well, like go into a place, just do it. Ask for, don't ask for permission. Just regulatory change. Forgiveness. Yeah. Like just, just make it happen. So the article said Uber deployed lawsuits and regulatory assaults so regularly that the serial entrepreneur, Michael Bertoff said in 2023, that hailing an Uber account amounts to hiring a law firm that just happens to have an independent contractor driver nearby. Its army of lobbyists and aggressive political maneuvering cowed politicians from New York City to New Delhi. The company's playbook inspired a new term, regulatory entrepreneurship. In trying to apply that model across industries, Churi, who was the original investor, the original venture guy, and I forget his first name, and Taaklo, he built a company that has little in common with a traditional VC operation.

59:16here's a coup de grace. Rather than hiring mainly MBAs, trust ventures is stacked with lawyers. Chury and his team devote much of their time to dissecting regulations, looking for loopholes. So I have no opinion on like, you know, is this dirty? Is this good? Is this necessary? Is this what you need to enact change? Whatever. Like that's a whole other nuanced debate. But this is the world that we live in, in the United States where everything, I feel like the, the, um, the default answer to everything, can we do this is no because of legislation. So now you know why so many business leaders and entrepreneurs and venture capital people, uh, were Trump supporters because it was the promises were deregulation.

59:58We're going to cut the red tape and let you do whatever you want. Right. Yeah. And that's say what you say, what you want. If you're, you know, obviously a lot of people are not supporters, but like there is a lot of over-regulation. And is there the risk, the not so little risk that we cut too much fat to the bone and we over-deregulate? Sure, of course there is. We definitely will. I would imagine there's stuff that's going to happen because of this, but we obviously went too far in the other direction. All right, this headline stuck out to me immediately. Kraft Heinz, CEO, warrants of worst consumer sentiment in decades.

1:00:34That's from Bloomberg. So they reported The CEO said, we now have one of the worst consumer sentiment. Okay, I just read that part. The company expects full-year organic net sales to be down 3 % to 3.5%. He cited slower growth in emerging markets and pressure on the U.S. retail. They cut their outlook. All right, so obviously my thinking is, hey, wait a minute. Maybe there's just other things happening that in the industry, more so than just like, yeah, the consumer doesn't buy ketchup anymore because they can't afford ketchup. So Bloomberg says, other big package - Right. Other big package food companies have, yeah, how bad do things have to be without being insensitive for you to say, no, I can't get ketchup.

1:01:15Right? We buy, listen, we buy a lot of ketchup in the Carlson household because my son, he'll fill up half his plate with ketchup when he has a burger and fries. I got him a t-shirt last time I traveled somewhere that says I put ketchup on my ketchup in the Heinz logo, you know? So it's not our problem. Sorry, Kraft. We're doing our part. Same. Kobe dips apple slices in ketchup, which is disgusting. Everything, right? Kids use ketchup forever. Yeah, it's gross. All right. Analysts have said that these companies make the kinds of processed foods Americans are moving away from. Now, obviously, Heinz makes a lot more than just ketchup.

1:01:46So how's this for a nonsense quote from Mondelez CEO? The government shutdown going forward will not help with the confidence of the consumer. Bro, your company's not struggling because the consumer is worried about the government shutdown. Get out of here. Ben, did you watch the show Ridiculousness? Or are you even familiar with it? Yeah, Rob Dyrdek. Okay. He stole the show from Tosh, Daniel Tosh. Do you remember Tosh.0? Yeah. Okay, so we used to watch that one, and Rob Dyrdek stole the idea of Ridiculousness from Tosh.0. Got it. Okay, I never saw Tosh 2.0. Tosh.0, I'm sorry. But I was familiar with it being a thing.

1:02:23I didn't know that. Anyway, so apparently there's like a new shit has come to light. There's a lawsuit, and this was unearthed, then. It was literally the only thing they'd play on MTV for like 24 hours a day. So this dude is making 32 and a half million dollars a year. They do 336 episodes a year. Isn't that wild? Did you ever watch Robin big back in the day? No, I know what it was. I think he was his bodyguard or something. Yeah. I liked that show. He passed away. Um, all right. Anyway, I just thought it was wild that he makes that much money content and, and business. And obviously MTV is a paramount, uh, paramount studio thing.

1:03:00Anyway, that was a face blur for me. All right. A lot of people shared this meme with us. When two dads run into each other at Costco, dad, uh-oh, here comes trouble. Other dad. I guess they let anyone in here. Both dads and Tom Cruise with just cackling. So good. Yeah. That one got me. Here's another good one. Somebody said, hey, what was that AI podcast that Ben mentioned last week? A million people asked me. Just so you know, people in the future, we do show notes on our websites, wealthofcommonsense.com or relevantinvestor.com. That has links to everything we talk about. So if you need, because people ask me and I share, but if you need to know, we have show notes on our websites.

1:03:40All right. Well, get this. No longer will you need to go to the show notes or email Ben directly because this person asked Google, which said, it gave him the answer. He said the Animal Spirits AI podcast and it gave him the answer. Wow. That's pretty good. That's pretty cool. Right there. All right. There was this robot thing on Twitter that went nuts called Neo, the home robot. And there was a video and they showed it and it says it can do your laundry. It can clean for you. See, the person that folds your laundry, their robot's going to take their job. Now, and it says you can, I think you can buy this thing for 20 grand or pay like$500 a month for it.

1:04:16And this had like 67 million views on Twitter. And I just have to say, and it sounds like there's some caveats. I guess there's going to be someone watching the robot through a screen for certain tasks and controlling it for you. So it sounds a little sketchy, and I'm sure it's not ready for primetime, but I'm not usually an early adopter of technology. And I don't know how this thing's going to do. Who knows? That's true. You just discovered Apple Pay. But I will be one of the last people. I'm going to wait five years to buy a robot. I'm not going to be the one who buys the robot and have the robot come choke me or something.

1:04:50I've seen enough movies. I'm not going to be a first adopter of a robot. Here's the thing. I don't want a robot to look like a human. Why can't it just look like, why can't it be a box with tentacles that come out? I don't want it to look like a person. That's way too creepy. If you walk in your house in a dark room and the robot's just sitting there, how creepy is that going to be? I don't want to have, I'm not going to be a first adopter of a robot. And listen, if you buy a robot and the robot kills you, no one can feel sorry for you. If you buy the first version of the robot and it turns on you like iRobot style, you can't, it's like going skydiving and you die.

1:05:21like sorry no one feels sorry for you fair Daniel's getting uncomfortable he's moving in a seat I'm sorry but if you buy the first version of a robot and it turns on you and it kills you I'll go to your funeral but I'm not gonna like I'm not gonna shed a tear sorry um robots are coming they definitely are but I'm not I'm gonna wait right well of course you are I saw my I mean listen I think I think by definition most people are gonna wait for a$20 ,000 robot purchase True. All right. But yeah, they're coming. All right. So I got into the, I gave up on baseball like 15 years ago. I just didn't care anymore.

1:05:56It's too long, too slow, too boring. I had other stuff going on. I got really into the playoffs this year. I watched the Tigers play. They barely lost the mirrors, and I kept watching. And I watched, and I got really invested in the Blue Jays and Dodgers. I watched most of the series. I really wanted the Blue Jays to win because I hate the evil empires that spend too much money. And John Smoltz was the announcer. So I stayed up and watched the whole Game 7 the other night, one in the morning or something. Awesome game. I felt so bad for Blue Jays fans, our fellow Canadians that always listen to us.

1:06:23But John Smoltz is the announcer for Fox, and he's really, really good. And it got me thinking. I forgot. The very first boss I had in this business, John Smoltz has some Detroit ties because he started out his life with a Tiger. I don't know if he's from Detroit, but he started out with the Tigers, and the Tigers traded into the Braves where he got all good. My boss had had a professional athlete as a client. He had some family office clients, but mostly we worked with institutions and had a really bad experience. And someone said, hey, John Smoltz was recommended as a client to you. And he'd like to talk to you because your other clients had such a good experience.

1:06:54And my boss said, no, not talking to him. And I said, whoa, whoa, whoa, whoa, whoa. No, we got to take this meeting. This is John Smoltz. And he said, I have a hard and fast rule. I never work with, I will never work with a professional athlete again. The demands are too much. It's, they were divas. I don't know this guy from anyone else, but I'm not going to even take this call with him. And I was flabbergasted. But looking back on it now, I love that he had that hard and fast rule. like these are the clients i'm going to work with these are those i won't anyway that's my john small story wow all right recommendations can i go first because i got a handful here first of all i have a horror movie that got me the heebie-jeebies it you know the i i you say i'm a robot because i don't have those feelings i got it okay which one this is because my son he he now likes our chat gpt to say hey we like this movie type it in other movies like tremors other movies like beetlejuice so we've been using that a lot so yesterday we watched arachnophobia and that movie makes my skin crawl.

1:07:51Absolute, like, because it feels real. It's not one of these weird, that. I hate spiders. I do too. And so that movie, I mean, if you lived in the house, I don't know if you've seen it in a while, but you would literally burn that house to the ground before you stayed in it, correct? The whole house was swarmed with spiders. Yeah, disgusting. I did rewatch like an hour of it a couple of years ago. I mean, John Goodman as the exterminator. and Jeff he was was that his breakout role probably not but it that's my only memory of him he was in Raising Arizona it was probably his breakout one okay so I did watch Naked Gun it's on Paramount right now and I love the originals we've talked about this and obviously Leslie Nielsen wait what's his no Liam Neeson let me ask you this was it better or worse than you thought it was going to be I belly laughed probably five times like hearty laughs and so he's obviously it wasn't quite the same same as the originals, but there was enough good jokes in it that I really laughed hard.

1:08:48And that was, and that's all you can ask for. Yeah. It was like an hour and 20 minutes. That was great. Okay. Um, so the house of dynamite was literally the one of the worst movie endings of all time. Holy shit. Right. For a movie that tried to be good. It was one of the worst movie endings ever. I really was. That was the, that was the horse meme. The, the, whatever the crap in the back. I'm, I'm usually like, I can forgive a bad ending. Cause I know sometimes the planes are hard to land. but that ending completely invalidated the entire thing. And not just the ending. Idris Elba's entire existence of that movie, and I'm not saying it was his fault, as soon as he came into the movie, it went to shit.

1:09:24There was so, and no spoilers, do not watch this movie, okay? You're welcome. Don't waste your time. It was a waste of time. Oh my God. Did you rewind as soon as it ended? Did I skip a part? That's what I thought. Wait, did I miss something here? What were they doing? Who thought that was good? All right, speaking of the horse meme, I watched Weapons on HBO Max. Now I know this movie had a little buzz. I think you kind of, you liked it? Weapons? I know you saw the theater, right? Okay. This movie was the horse meat, okay? And I know this movie got some buzz. I thought the first hour of the movie was like riveting.

1:09:56It was, oh my gosh, what's going on with these kids? And Julia Garner, who was in Ozark, I think she is fantastic. But then they went, and her storyline was great, and Josh Brolin was pretty, and they did all these different, the same story from different points of view. I thought it was really good. In the last hour of the movie, I thought just, it was a car careening off of a cliff. It was the lady from Uncle Buck. Shanice from Uncle Buck. Or not Shanice. I can't remember. Uncle Buck's girlfriend. And she's also in Field of Dreams. Just the payoff, I thought, was so, so bad. And the fact that it was like 2 hours and 15 minutes.

1:10:26This should have been an hour and 30 minute movie. I thought this was the total horse name. So here's my analogy for movies this year. I feel like 2025… Wait, hold on, hold on. Hold on, hold on. Before we get off weapons. You having a strong take on weapons would be like me telling you that Uncle Buck doesn't work. You're not allowed to have an opinion on horror movies because you're not a horror movie guy. And the last, the part that you didn't like about weapons when it got silly, that was like obviously intentional. It was comedy and I did see it in the theater and the entire theater was cackling because that was the intended purpose.

1:11:00It wasn't supposed to be like, huh, that's a weird ending. So you don't get to, you don't get to weigh in. Sorry, no offense. It was an unintentional horror comedy. No, no, no, no, no, no. It was very intentional. It was intentionally hilarious. You were supposed to laugh at the end. The whole last, just, I'm sorry. It was awful, terrible. Didn't work at all. It was really. All right, well, guess what? Transplants and automobiles, stupid. You have these two 40, you have these two middle-aged guys are crying with each, come on. My point is, it's not, it's not a, it's not, no, no, no, no. I love transplant.

1:11:39My point is... You're getting upset about my weapons review here? No, no, no. My point is this is not for you to weigh in. Get off my lawn. Here's my theory about movies in 2025 because we've done this a lot. Sinners, I thought was a good movie, not a great movie. I agree. The PTA one, you said, everyone's saying this is a classic, but it's just a good movie. I thought weapons is kind of the same thing. So here it is. So Michael Mobinson had this piece about Ted Williams and why he hit 400. And the reason is because the level of competition was wider back then. There weren't nearly as many good people.

1:12:08So now there's a higher average overall, but it's the, you know, people are just better. And I think that was a Ted Williams thing. So in the 2000s, I'm going to land this plane. Kanye West, everyone called him a genius in the 2010s ring rapper. I think if he was in the 1990s, he would have just been another rapper. He would have been good. He would have had some hit songs. People never would have called him a genius. And it's because there was no other good rappers at the time. And so my point here is there are so few good movies anymore. anytime that there is a good movie, a decent movie, people have to say it's the greatest thing ever.

1:12:40Okay, I totally agree with that take. But also, if you ask me - It's a relative thing. If you ask me, should I watch Weapons? I would say, no, it's not for you. Because it's genuinely not for you. Like, I'm not surprised you didn't like the ending because it's not for you. But the first hour of the movie, I thought was really good. It was really interesting. Yeah, and I enjoyed The Shadow Weapons. I had a great time. But like, I agree with you. Full horse meme movie. Is it a - No, stop. Is it a classic? No, it was a good horror movie. It was fun. I had a good time. All right. Any recommendations for you?

1:13:09Daniel, did you watch Weapons? Did you love it? Yeah, see? Daniel loved it. He gets it. Any other recommendations? No, I just de-recommend House of Dynamite. I'm pretty dry right now. Oh, you know what's annoying? I really want to watch the Scorsese doc. It's like six episodes on Apple TV. Come on. That's a two-hour movie at most. I don't have time for six episodes of Marty. That is a lot. See, they should have Audible for documentaries. Yeah, I went two times the shit out of that. I really want to watch it. Yeah. So you should just be able to, like, do you need to see a documentary? I guess you want to see some movie scenes, but okay.

1:13:48Okay, let's do some plugs. Let's plug Talking Wealth. Yeah, so we have a podcast channel called Talking Wealth. And we talk about stuff in our day job, stuff going on around the industry, who's making noise, what should advisors be looking for. So you can find that on our YouTube channel, Talking Wealth. It's a YouTube, Talking Wealth. We also have a podcast version now. It's you, me, and Josh talking to people about what's going on in the industry and new exciting products and services and strategies. And yes, take a look. What else? All right, that's enough. We went long. Sorry, Daniel. It's going to take a minute.

1:14:25Is our FBA conference going to be a podcast or not? Yeah. Okay, I don't know. Animal Spirits at the Compound News. Thank you, everybody, for the listens, for the emails. Love hearing from our audience. Have a great week. We'll see you next time.