The Wealth Paradox (EP.318)

23:55Right now, you don't do that. You probably go on YouTube. YouTube, podcasts, blogs. Books are way down probably, I'm sure. Yeah. I think it's easier to dabble in the Doomerism these days because there's more outlets for it. When we were coming up, there was no Doomer outlets. Hmm. Right? No. Unless you were a big Harry Dent fan back in the day. I don't know. There was a lot. I don't want to name names, but there was a lot. There's always been a lot of bears. Fair. I think it's easier to try it now as a young person. If you feel like I'm never going to be able to buy a house and I feel like I got screwed and I'm left behind.

24:32Let's flip this. I think your first premise was right. Nobody, and I will say nobody, you know, maybe there's like a dozen people out there. Young people are not reading the intelligent investor. And they're definitely not reading securities analysis. They're just not. Nor should they. Which is probably a good thing because that's like expert level stuff. You read that after you've got the basics down. that the intelligent investors, not basics of investing. No. And it's a huge book. And he talks about like railroad stocks. There's like two chapters, chapter eight and chapter 20 that you should read.

25:04It's mostly unreadable, except for this. You're right. All right, we've talked a lot about consumer sentiment and how it's crazy that things still seem to be going so well, but consumer sentiment was crashing. And obviously the big reason for it was inflation being so high and people hate inflation. So this is maybe fun with numbers, but I think there is some truth to this. So we talked, I remember we were on Derek Thompson's podcast. a while ago, and we talked about how high gas prices and people just see those numbers on a screen. And that's one of the reasons that people are so... Look at this chart I created of U.S.

25:35consumer sentiment and retail gas prices. Gas prices topped at basically the same exact day, week, month as consumer sentiment bottomed. I don't think this is a coincidence. Obviously, inflation falling helped. And this is right around the peak of inflation. But I do think I think it doesn't seem like there's as much because inflation is still relatively high. And again, we haven't unwound all the price increases, but I don't see as much angst about inflation anymore as there once was. And I think gas prices are honestly a big reason for it. Huge. For like as far as public sentiment. Remember, every day on the news, you'd see a huge story about gas prices going up here and they've come down.

26:18Obviously, oil prices have fallen, too. There was this great quote in the new William Bernstein book. He said he kind of based his whole ethos of what's changed in the last 20 years since he wrote the first four pillars of investing. And it was from Robert Kaplan, who's a geopolitical expert. And he said, half of everything is geography. The other half is Shakespeare. And I love these. So it's like, you know, the real world and data and stuff, that's part of it. But the other half is like narrative and storytelling in the human brain, essentially. And I do think that a lot of macroeconomics, it's like we're talking about all these crazy data points and stuff.

26:52And it's like the simplest Occam's razor here was, oh, it's gas prices. That's the majority of why people were upset when it came to consumer sentiment. Yeah. Fair? Yeah. All right. I think another reason that the economy never rolled over, I think everyone really just underestimated the consumer. So Sonu Varghese from Carson Group tweeted this to me after I wrote a piece last week about, like, people underestimating the mortgage lock-in and the fact that people's balance sheets are so much better. Do you mean he's Z-ed? Oh, jeez. I don't even know what... I think... The billionaires are all just so bored, aren't they?

27:39I think I tweeted... I slapped this to you and Josh, but there was some... What's the guy's name in succession? The big, tall Norwegian guy? What was his? Mattson? Skarsgård? in the season in the season finale from the second to last season the penultimate you might say which is one of my least favorite words to use I was stunned by that he was having his one on one with Logan Roy about should I buy you or should you buy me and he said success doesn't interest me anymore like success is easy I've made billions of dollars what interests me is like breaking things down and destroying things and I feel like that's one of the things they really nailed where I think at a certain point when you've had enough success, especially at an early age, I don't know, maybe just playing around and toying with things is just, I don't know what's going on with Twitter.

28:31And through it all, it's still because Threads doesn't seem to want to make, be the same thing as Twitter for whatever reason. Side note here. Do you remember the Larry David story? It was a Seinfeld episode where Larry David quit SNL. He got all mad about something and he quit SNL on a Friday and then showed up again on Monday and pretended like nothing happened. That's all the people who said, I'm out of here. I'm leaving Twitter forever. I'm going to threads. I feel like those people are playing a Larry David and just coming back like nothing happened. Just pretending. Anyway, yeah, that whole X thing, I don't know.

29:03There's never been a successful rebrand in all of history, has there? Or like a name change actually worked? Can you think of one? I still think Zuckerberg doesn't get enough for changing the meta. That was a dumb, that was, that one might've been even dumber than Twitter turning to X. I feel like he doesn't get enough. Well, it's because the stock recovered, but you're a hundred percent right. That was so dumb. You know why? I mean, you don't change your name if things are going well. True. And turnarounds are hard. That's true. All right. So back to the econ stuff. So consumer spending is, this is real personal consumption expenditures, had this massive drop.

29:41And then it's basically right back to the pre-pandemic trend, which is interesting. This is another one I haven't seen. Credit utilization rate by credit card and home equity. And it shows pre-pandemic averages since 2003. And credit card is way below. So this is percentage of available credit. And pre-pandemic average for credit cards was 51%. It's only at 38 % now. Wait, but I thought everybody was loading up on debt. I thought that's what was keeping the consumer strong. You're telling me that's not true? I guess not. I think the economy is so much bigger that people just have more debt. So this wouldn't surprise me.

30:13Like the credit utilization rate is not even close. I mean, for home equity, it's pretty steady over time. It's a little below. But for credit cards, it's way below the averages and way below where it was pre-pandemic. So if people do start running out of money, excess savings and such, the credit cards are coming next, right? Credit card debt, I think, in the coming years is going to skyrocket. Like credit cards and home equity line of credit, I think in the coming years, that's my biggest bull market. You heard it here first. Credit card debt is going to explode? I think if we start seeing a slowdown, like credit card debt and home equity lines of credit are going to explode higher.

30:56Does that happen in every recession? People dig deeper into credit card debt? Probably, right? Well, that was the weird thing about the pandemic is that people paid down their credit card debt even though we had a recession. I know it was the quickest recession in history. That's why it was so bizarre. Ben, last week or the other week, you were talking about like, are people going to say that Powell nailed it with the soft landing? Is he going to be praised with the benefit of hindsight? And I saw there was a column in Reuters, a soft landing, and is Powell the most successful Fed chief ever? Now, I forgot to read the article, so sorry about that.

31:40But here it is. I don't know. It's coming, I guess. Nailed it. Somebody's saying it. Right? Somebody's saying it. Yeah, I still give him a lot of credit for how they navigated the pandemic, obviously after the fact. Although, I mean, listen, if it works, he will get credit that he, in my opinion, doesn't deserve because they were needlessly driving on the freeway going 97 miles an hour in a 65 mile an hour zone. And then they jammed on the brakes. Right. and they happen to avoid a crash, I don't know that the driver would get credit for that. Yes, I agree. I think if we do get a soft landing, people are going to forget about the fact that they waited so long to raise rates the first time.

32:25To beat this analogy into the ground, you credit the passengers for remaining calm in a scary situation. Fair, not backseat driving. Yes. Last week, I talked about the fact that the only indicator right now for a recession is the yield curve. And you said, well, leading economic indicators too, but I want to hit on the yield curve. Colin Roche at Discipline Funds had a good take on this. What does the yield curve tell us? And he said it's best to think of the inverted yield curve as a Fed funds rate prediction, which is an implied prediction of future relative inflation. This often correlates with rising recession risk and rising market risk.

32:58But in and of itself, the yield curve is not a recession predictor. He's saying that the yield curve being inverted is guessing where rates and inflation will go. And the idea being the reason that it's inverted right now is because the market thinks that inflation is going to remain low going forward and therefore rates are going to go down. But that doesn't necessarily mean that we're going to hit a recession. And he's saying if you look at it globally, that kind of makes sense. So it's - You know what I think has been debunked or put to bed is this idea that one of the reasons why a yield curve predicts a recession is because banks borrow short and lend long.

33:37and when the yield curve is inverted, you're less likely to do that. But that's not true for two reasons. Number one, that's the US government yield curve. It's not like the corporate yield curve or small business yield curve. They can lend and borrow whatever rates they want. Number two, how many trillions of dollars are sitting in the banks on deposit earning zero? Right. Right? Like literally earning zero. Yes. Two basis points. I mean, what are the checking account pay? So they're still borrowing at zero, even though the Fed funds rate is at five, five and a quarter. Plus the Fed is so much more intertwined now with the interest rate markets in terms of them.

34:14They were buying treasuries during the pandemic. And I think the yield curve itself is so fraudulently because of what the Fed has been doing these past few years. It's hard to say like the market is implying this. Yeah, yeah, exactly. Yeah, the market. And so does Cam Harvey, by the way, the one who created the yield curve indicator. Like he said that it's time to time to reconsider. All right. This is a South thing. So I may be even mispronouncing this, but have you heard of this Bucky's place in the South? I have not. Like people in the South. I think it's like a store slash gas station slash car wash.

34:48And someone posted this on Twitter. They showing how a cashier earns$17 an hour food service and car washers 20. A manager earns like 24 to$32 an hour. No experience necessary. Assistant general manager earns a hundred K. car wash manager,$125K. General manager could earn up to$225K. They have a 6 % 401K match, three weeks paid time off, plus$2 an hour for overnight and healthcare. This is it. It's the labor market, right? It's not that complicated. Remember, there's all this 1950s, 60s, 70s nostalgia for, and this is true, especially in Michigan, of the automakers, that you could get a job at an automaker without a college degree, and you would have retirement benefits and healthcare benefits and make a living wage and you did pretty good for yourself.

35:37And people are wondering, where has that time gone? It's kind of crazy that it's kind of been brought back a little bit. These numbers are insane, correct? Like from what you would assume, right? I don't know how hard it is to get a job in one of these places, but it's pretty crazy. Let's talk about AI for a second. This is from the transcript quoting McDonald's CEO in terms of where AI is going. And I know Ben doesn't care about AI until he has his personal assistant, but it is a thing that's coming. I was playing around chat GPT last night, actually. I was asking a few questions. Here's where I've come down on it.

36:09Like if I'm running a sort of blog post or something and I want to make sure I hit everything, I'll put the question that I'm asking into chat GPT to make sure that there wasn't something glaring that I just completely missed. Because it kind of goes through and bolts. So it's helpful. But here's the thing, though. does it feel like it's it's waned a little bit in everyone is kind of like for when it first came out half the tweets on twitter were people being like look at what i created on chat gpt aren't i so uh you know aren't i so great you don't see him anymore i feel like it's it's kind of the shine has come off a little bit until people actually take that back aren't aren't i so great that's a weird take on people tweeting about chatting no i i think people oh people just not so great people thought that they were just being very witty like look at this witty thing that i created on JetGPT.

36:57Like, look at how witty I am. So that's died down? Don't you think? I don't see it anymore, ever. Yeah. Yeah, I mean, to say, listen, we're in, the game hasn't even started. I was about to say we're in the top of the first, but the AI revolution is only, we are at the dawn. So McDonald's CEO, you're also getting vast amounts of consumer data. We get about 65 million people a day visiting our restaurants. We're collecting data. I'm roughly half a third of those, okay, you can start, you can then start to customize. Imagine driving up through the drive-thru and imagine that maybe the drive-thru menu board changes because we know that when you typically come to McDonald's, these are the items that you'd like to buy.

37:34And so now you have a menu board that maybe is customized to you as opposed to just being a menu board. All right, you got the point. Listen, I don't think this is, this is in and of itself. I don't think this is in and of itself like so incredible. Like if I go to McDonald's, I get the kids, the six piece nuggets. Like I don't. Wait, so if you drove, if you drove up to the, what would the menu look like for you if you pulled up in your in your new jeep wrangler what would what would the menu look like for mcdonald's for michael's ai uh what is my what is the brand of car i drive have to do with this i'm just saying you're going in the drive-thru i we were talking about the other day no we're not it's not a day we were talking about your jeep the other day so i'm just saying you're driving your jeep through the drive-thru what is the menu look like for michael bannick i love fast food i absolutely love it.

38:18I grew up on fast food. Yeah, but I don't eat it really that much anymore. Credit to me. I guess the only time I really eat it is when I'm traveling. But I guess I do eat it because I eat the kids' nuggets and fries when they're done with it. But I like it all. I don't discriminate. I like it all. Some are better than others, but I'll take anything. Anyhow, I still think McDonald's has the best fast food fries of anyone. McDonald's fries - I agree. People are like, oh, the fries used to be better. Yeah, maybe, but they're still pretty damn good. Anyway, so listen, the menu changing to what you order is not that exciting, but you get the point.

38:50The possibilities of what AI is going to do are more or less endless. It'll be little things that we don't even notice and we just get used to, I think, that'll be happening behind the scenes to make your life easier in tiny ways that you don't even think about anymore. I don't think it's going to be tiny ways. I think it's going to be huge ways. I think it's going to change. everything is a lot, but you know what I mean. It's going to change a lot. I don't know. I think it'll be more for workers than it will be for your day-to-day. That's my thinking. Unless we have our Scarlett Johansson in our ear, then game on.

39:28All right. Good real estate stuff this week. This is from Rick Palacios Jr. This was a chart from one of his webinars for John Burns Consulting Group. He said, so the blue line here in this chart shows owner-occupied housing units. So this is exclusive of the rental stuff we were talking about earlier. This is owner-occupied. So in 1983, we're talking 53 million owner-occupied housing units in the U.S. Now we're up to 86 million, right? But then it shows existing home sales on the other line, right? You can see in the bubble of the early aughts, existing home sales shot up to like 4 million. And then it got even higher because supply grew during the bust afterwards in 2008.

40:08But now look at it. So if we're doing a ratio of existing housing units that people live in that are not renting out versus existing homes for sale, so we're back to a million existing homes for sale where we're at 4 million in 2007. But there's also 10 million more homes. So the ratio of the amount of homes out there versus the existing home sales happening has never been this large before the ratio. There's just, the inventory is so low, especially when in relation to how many houses there are. It's just ridiculous. So fewer people can afford to buy a house and housing prices won't come down because of this basically.

40:44It's unbelievable. Here's another crazy stat to piggyback on that. Forget who tweeted this. We'll link this in the show notes. Another way to look at low inventory. There are 600K more realtors than homes for sale right now. How wild is that? there are 600 ,000 more realtors than homes for sale. Just a little bit. Okay. So newly home builders are the only game in town. We've been talking about this historical norm is they make up 10 to 20 % of, of home sales right now. Wall Street Journal has almost 35%. And they talk about how this is for people looking at houses. This is kind of the only thing that matters, right?

41:25Is that, that if you're going to go somewhere, where they talked to this couple who did a temporary buy-down that reduces their mortgage rate for the first two years of the loan, and they can hope they can refinance later. And the guy says, I'm hoping we made the right decision. I don't know if it was the right time to buy, but rents just keep going up. Kind of like, listen, we're screwed either way, so we might as well take the leap and hope that we can refinance down the road. And I almost don't blame them for it. I don't know what else people can do at this point if supply is not there. I feel like a lot of people that I talk to that are buying houses are doing adjustable rate mortgages, which makes sense.

41:57They're like the five and a half-ish range, which it seems fairly low. Can you imagine telling someone in like, someone in 2010 that it makes sense to do an adjustable rate mortgage after what we just lived through? Right. But it does seem like the risk of mortgage rates being higher in five years is, you know, I'd take that trade. Did you listen to the Odd Lots podcast this week on housing? Yes. So here's Kyle Kovacs tweeted this. Just heard this incredible stat from James Egan on Odd Lots. One third of all homes in this country are owned by people age 65 or older, and 50 % of those homes were bought before the year 2000.

42:37Now consider Case-Shiller is up three times since 2000 and four times since 1990. That's kind of that half of all people 65 or older who own a home bought it before the year 2000. We've talked about this. I think the average people have lived for 30 years. My parents have been in the same house since 19. This is the thing where even if people start to lose their jobs, where do the foreclosures come from? Because why would these people ever need to sell if they own their home outright or they have so much equity and it doesn't even matter? Well, how long are you staying in your modern farmhouse?

43:15We've talked about kids are out of high school probably at least. I mean, unless rates come back to 3%, it makes sense to move. I don't see – but here's the thing. When do these people 65 or older – last week in the comments, I'm watching what I say because someone said that it's cringe that I say boomers so often. I'm sorry. Boomer is equated with old people just like millennials equated with young people. That's just the way it is. It's not a derogatory term. You can use it in a derogatory way. Yeah, but I'm not. I don't think – but boomers is not a derogatory term. They are the baby boomer generation.

43:47Exactly. So the thing is, so I do think they talked on lots about like, when is the baby boomer flood of supply going to happen in 2030s? Could that slow housing? I think it could. I also think it'll be a renovation boom. If these people have all owned their home before 2000, young people are going to see these old houses that need to be fixed up. But his, I thought his biggest point was if rates go back to say 5%, there's going to be more demand than supply, meaning more people are going to come off the sidelines wanting to buy than wanting to sell. And I think - Well, there's already a demand supply and balance.

44:18It's just going to go even more extreme. One of the points that he made was, and I forget exactly what he said, but it was like, had you told me three years ago, given where demographic trends were heading, I never would have thought that X, Y, and Z. And this goes back to my point about demographics. Of course, they matter a great deal. But when you're talking about demographic trends out to 2050, I'm sorry if I can't get worked up over them. Not that they don't matter, But this guy's an expert on housing and he's even three years with demographic trends. He couldn't forecast what happened. It's kind of like with the markets, the news doesn't matter as much as the reaction to the news, right?

44:56It's the reaction to it that matters more than like everyone knows the demographics, but it's like, what's the reaction to function going to be? Because interest rates were low in 2019 before the pandemic happened. And there wasn't this huge flood of buyers looking to buy, right? It took this spark of the pandemic. Yeah, no, not at all. Right. And homes were, guess what, a lot cheaper back then, and rates were lower, and there wasn't as much demand. All right, here's a good one from MarketWatch. How much do you need to make per year to afford a$500 ,000 house? Did you look at this yet? What's your guess?

45:30No, I didn't. What's your annual income to afford a$500 ,000 house? You can give a range if you'd like. Prices rate rules apply. all right uh let's say 125 to 155 pretty good it was 140 uh and then for a million dollar home 281 thousand dollars a year and they're talking about like big cities like new york or san francisco how's that pretty good i feel like i nailed it i feel like you're you don't give enough credit when i guess things right i said that's pretty good you gave a range and you were right in the middle not that's i kudos to you but better than pretty good you could you could even be as generous just to say I nailed it.

46:08You nailed it. What percentage of homes in the U.S. are worth at least a million dollars? What percentage of homes are worth a million dollars or more? One out of 10. Yeah, it's 7%. So you're pretty close on that one too. You nailed it again. Way to go. Thank you. What would you guess? Yeah, one out of 10. Yeah, probably. That's pretty good. You must be a little sharper because you're on vacation right now. We haven't even mentioned the fact that you're doing this show from the Bahamas. Credit to you. You skipped on us on Disney, but you've made it happen to Bahamas. And that was after you forgot one of your cords.

46:45So we almost couldn't do it. Yeah, a bit of a panic. I left my charger, my computer charger at home. We went, we walked through, so we checked the luggage. I prefer not to check luggage if I can avoid it. But my wife, I assume like a lot of other wives, does overpacks. And so we checked our bags. And as I walked through the gate, the security gate where you put your carry-on through the metal detectors and whatnot, I'm like, oh shit. I'm like, Robert, I left my bag back there. She's like, we checked, you idiot. And I'm like, well, in my defense, I've I've walked – I've left my bag in the airport more than twice where I just walked away from it.

47:37That doesn't surprise me. I'm a little absent from it sometimes. Did you buy a new pair of Maui gyms to bring with you? There's a lot of people who stood up for Maui gyms. I wasn't degrading the Maui gym brand itself. I was just more saying don't spend a lot of money on sunglasses because you always break them, especially if you have kids and you're a little more active. that was my whole thing is that I have kids so I'm always active doing stuff with them and I'm not gonna chance so Robin says I look like an idiot in these sunglasses I guess I do look a little bit like Neo I was Neil the thing that came to me but uh you know I value my my eyeballs they're sensitive and these have these have great lenses so you don't have a prescription do you No.

48:22Am I overpaying? Yeah. But what's so funny? Nothing. Duncan just said, oh my God, on the Slack when you put on the sunglasses. All right. Well, it's a little bit less ludicrous. Here's the thing. You have to put this into context. Duncan, I always wear a hat when I wear sunglasses because I can't go outside with a bald head. That's asking for trouble. So does it look a little bit less? Do I still look like as big of a doofus? No, that's your sunglasses style. Thank you. He said that's much better. Thank you, Duncan. Appreciate it. Listen, it is what it is. You know, you got to play the - What is your review of the Miami Vice's in the Bahamas?

49:07Pretty good? I only have one Miami. I mean, I love Miami Vice. Who doesn't? But you can't drink more than one, right? They're just, they're too rich. So we had one. It was great. You have one per day. You know, this is not specific to the vacation, but I've noticed this a lot and I never really spoke about it out loud, but I'm going to speak about it out loud right now. You know that thing where you smell something that's foul and you smell, you sniff like three more times just to make sure it's as bad as you thought it was. And then inexplicably, 10 seconds later, you're like, is that smell still there?

49:37And then, oh yeah, it is still there. So that happened with me. And I was thinking like, what is that? And I'm sure it's not just me. That's like, got to be like an evolutionary instinct thing, right? where there's some sort of threat by smell, fire, whatever it is, and just to make sure that you're in the clear? Because there's no logical reason. It doesn't – whether the smell is gone or not is not relevant. Why would I keep sniffing? That's fair. It's a danger thing. So this is back to evolutionary psychology. Can you confirm this is not unique to me? When you smell either garbage or something worse, you sniff?

50:11Because you want it to go away. So he keeps sniffing in hopes that it'll be clear. Well, what was it? It was vomit, I think. Oh, okay.

50:23Nice. But no, this is a great spot. There's a casino, which I enjoy. We've enjoyed casinos together. Have you done blackjack yet? Of course. Oh, nice. I like it. Up, down, up, down, sideways. You know what I realized while I'm just rambling here? I'm a big common courtesy guy. I've learned that about myself. Oh, credit to you. Not to brag. Just courtesy of the common variety. That doesn't mean you need to be Mother Teresa. But for example, if I hold the door open and somebody walks and doesn't say thank you, I say, you're welcome. It's just rude. There's no reason not to say thank you when somebody holds the door for you.

51:01You agree? Fair. Like if I let someone in on the road, I better get a wave. Exactly. That shit drives me nuts. If you make the effort to hit your break so that somebody can go in front of you, the least they can do is the common courtesy wave. So maybe this is a stretch because what I'm about to explain to you is going to make me sound like a crazy person. And I'm trying to entertain and be a little bit funny, even though I really do genuinely feel this way. I was emailing with somebody. And now again, I'm drawing a distinction. This is not common courtesy. This is just, it's adjacent. And I offered, I said, hey, could you do 12 Eastern?

51:38And you know what this person did? they said they offered a different time zone. They said, no, but how about 10 central? And now I wouldn't go as far as to say that's rude, but it's just a little bit, I already set the baseline, right? If you told me, if you, if he had, if he had asked me, can you do X central? I would have responded, no, but I can do this your time. I would have said your time. I wouldn't have switched time zones on him. So, you know, you know how I responded? I threw out Pacific time.

52:07threw him for a loop huh yeah i know i agree yeah i've done it because you're talking people in california or something yes i've and i think people in other time zones should always default to eastern since that's default time fair yeah but if somebody does that i'm not going to switch switch if somebody throws out can you do one pacific then i'll then fine then they set the baseline then now now we're working on pacific time it is what it is so you know where this got me recently. I'm doing a speech, an online speech for the CFA Society of India, which I didn't realize the time changed. And they gave me the time in India.

52:41And I said, all right, I can't be that much different. It's 6 a.m. Can't be that much different. Of course it can. Well, I knew it was different, but I didn't, I thought they would take it. And yeah, so I got to do it at 6 a.m. So credit to me. I got a question for you. So Carl Cantania posted a chart from S &P, Global private equity dry powder soared to a record$2.49 trillion around the middle of 2023, a greater than 11 % increase over the December 2022 total. Does this number mean anything? What does this even mean, dry powder? I know it's a number that gets thrown around. We talk about it. So the reason this rose is because the private equity companies didn't want to make any deals when things were bad or companies didn't want to sell, I guess.

53:22But this is just the difference between the amount of money that is committed to a fund. So let's say you have a$10 million fund and$3 million has been deployed,$7 million out of its dry powder. But a lot of times they never even call that much. Most funds might call 75 % of it because they'll just use distributions from other investments that have worked and you don't even get all the money to invest in the first place. So would you say it's a number that is factually maybe directionally correct but doesn't necessarily have any deeper meaning? It's not predictive. I don't think so. You can see it's constantly rising over time because there's been more investments in private equity, which makes sense.

54:00It's not like it's – yeah, like this big cash on the sidelines thing that's going to happen, I think. All right. Glad we cleared that up. Ben, somebody tweeted – this is for an MCU report. The price tag for some of the recent Marvel projects. She-Hulk,$225 million. Wakanda Forever,$250 million. Quantumania,$200 million. Guardians of the Galaxy 3,$250 million. Secret Invasion,$212 million. What is happening over at Disney? I mean, my lord. I mean, they just, people always overdo stuff. Marvel is working so well, and they decided, if a little Marvel's working well, let's just flood the space with it and just keep going.

54:44And obviously, they reached their breaking point. I think the glass floor broke, right? they've got to pump the brakes it's not working, it's over it was a great era and I think actually punctuated by Barberheimer it wasn't a great era well for me it was it was a great era for them just financially it was a great era for them I feel like movies were saved last year when Top Gun came out and then kind of nothing happened after that now movies are saved because Barberheimer came out but are we going to see follow through is like you said, is there's going to be top heavy where like once a year, there's going to be this event of a movie and then, then it kind of just goes back to normal and low quality crap.

55:29Yeah. And that's exactly right. I don't think that this is necessarily like a, I don't think that Barbenheimer is a turning point. Maybe it is just from the sense that the audience does not want another Marvel blockbuster. It's over, right? We're good. We've had our fair share. We're full. In fact, we might even be sick. So hopefully we get more exciting projects like this. I mean, we've got Killers of Flower Moon. That might be another big one. But I don't think they're going to go back to like funding. Oh, speak. How about this? I was watching Get Him to the Greek is on. I don't remember what services it on, but it was the unrated version.

56:06Pretty raunchy. Much raunchier than I remember. At least, again, it was the unrated version. and it is just such a shame that like i was thinking like why doesn't jonah hill make these movies anymore and i think i know the answer first of all obviously studios aren't aren't making movies like this but all these guys got too famous right like they can't afford you can't have a movie with jonah and seth rogan and all the other guys it's just it's unaffordable but how much that was now that was an era how much fun was that where five or six of those guys would be in the same movie every time super bad knocked up half those guys have been canceled too.

56:38So there's that. Yeah, that doesn't help. All right. But Amazon apparently didn't get the memo. They're paying $50 million to The Rock to star in a Christmas movie. Terrible idea. Has The Rock ever had a good movie? Has he been in one good movie? Fast five. But that's one. It's been a long time. He's never been in like a movie that you go like, that's a very high quality movie. Just that's a sorry, Bezos. That's a bad. Amazon CEO said, in the case of Prime Video, I'm very bullish on where we're headed. The content continues to get better and better. While Prime Video is really good at driving our prime value for our consumer business, I also think we'll have good standalone economics.

57:17I got to tell you, we spoke about Prime Video not really having a lot of success with the original programming. Their library is super strong. They have good movies. They have great movies. Phenomenal movies. People are going to have to get used to the old movies because the strike. Like, I just want to say, I thought it was one of these times I'm going to have to cut cable. I know I said I'm going to be the last person because my bill keeps going up. So it came up again. This is an annual tradition in the Carlson household. My bill went up$70 a month. And I said, this is crazy. So I called it AT &T.

57:51I said, listen, you know, listen, there's nothing we can do for you. Okay, let me talk to client retention. That's what they call it. Not cancel department, client retention. You know what, sir? We're going to give you that$70 off a month plus another$10. and allow you to keep HBO stars and Showtime. All right, I've heard you negotiate. You're not a good negotiator. How do I get... I'm not. How do I get customer service in Grand Rapids? How do I do that? Because the customer service reps in New York... There's no one I'm talking to someone in Grand Rapids. They stiffed me hard. I'm like, I'm leaving.

58:20They're like, sir, you could leave. All right, I'm really doing it. Okay, go ahead. It still works for me. They called my bluff. They gave me the 300 more channels and all the sports channels and the movie channels. How are you not in the database? this weasel every year calls us and threatens to cancel. Credit to you. It's still working. I don't know. All right, we're going long. And as Ben mentioned, I am on vacation. So we're going to go quickly here on great quarter, guys. So Netflix had a good quarter. I own the stock. Stock got killed. It didn't get killed. It was down 10%. Big deal. Was up what it was up.

58:5760 % going into this. So not a big deal in my estimation. But one thing that I do – oh, they actually started breaking out. This is crazy. Okay. We kicked off the quarter with Murder Mystery 2, 114 million views in its first three months. Closed the quarter with Extraction 2, which I have yet to see, which I will. Garnered 116 million views in only 31 days. Two movies I will never see in my entire life. I did watch Murder Mystery. It was exactly – it was fun. It was fun garbage. Garbage fun. Extraction was action garbage. A lot of fun. That's a ton of views. Holy shit. 114 million? How many people saw Oppenheimer?

59:33How many people saw Barbie? I'd love to know how they count these, though, because there's no way that many people watch these movies. I'm sorry. They're playing. They're having fun with numbers here. There's no way it's that high. Think? Does it count if you click on it on accident and that's a view for 30 seconds? But here's what I want to mention. The top 10 most popular films on Netflix. Listen, they break it down by hours and views, so make of it what you want. Red Noders, Don't Look Up, The Atom Project, Bird Box, The Gray Man, We Can Be Heroes, Glass Onion. Extraction, The Mother, Spencer Confidential.

1:00:05I guess I've seen half of these, and I could say none of them were really good. I like Glass Onion, but there's no high-quality movies on here. You know what's interesting what's not on here? The Irishman. Yeah, because that movie stunk. Did not stink. A lot of these movies stink. No one finished it. All right, let's move on. We don't need to get to the Elon stuff. Let's do records. I do want to get to this personal financing quick. Okay. This is from the Schwab study Barron wrote about this. 48 % of respondents to the surveys said they considered themselves wealthy. These individuals reported an average net worth of$560 ,000.

1:00:45When respondents were asked more generally how much money it takes to be wealthy in America, their responses averaged about$2.2 million, nearly four times what the self-described wealthy reported about their own net worth. Footnote 69 % of respondents said a healthy work-life balance is a greater driver of wealth and maximizing earnings, which is nice. I like that. But Ben, let me, this is an interesting, they call this the wealth paradox. And I feel like this is backwards. Or maybe it is consistent where you think that you're doing well, but the rest of the world is not. But it's interesting how you can consider yourself wealthy at$560 ,000 net worth, but think that wealthy is$2.2 million.

1:01:25That's a weird disconnect, no? Doesn't this also show a little bit of progress that people look at factors outside of money to determine their wealth? However, I do think that – in fact, I don't think this. I know this. That's a luxury, right? Like people that don't have money would never say that. So it's almost like a sampling thing, you know? Yes, it could be. But it's also interesting that people consider themselves wealthy. But if you want to really be wealthy, then you need four times as much as I have. Ben we spoke last week about how Danny Glover was 41 when he was too old for this shit I saw a great meme that describes me perfectly um it's Will Ferrell in Step Brothers and the post is when you're over 35 in a week past 9 9 p.m call me Nighthawk now you're a night owl but the other day the other day we were in bed and I was up way past my bedtime I was up at 11 o 'clock because Robin's on vacation now.

1:02:26Robin doesn't work for the summer because she's a guidance counselor. And she wanted to watch Hijack because she's really into it. I said, I can't. What are you, nuts? I should be sleeping. I can't start a show at 11 o 'clock. I'm going to fall asleep in two seconds. And she's like, what happened to you? You used to stay up. And I was like, when? When did I stay up? She's like, when we were in Astoria. I'm like, I was like 25 years old. I've been I've been I've been a 10 p.m. at latest bed sleeper for years now he's calling you out huh alright so you're taking the L on the bear here I see the L on the bear the bear oh yeah the bear at 99 % continues to run as the most popular TV series on Rotten Tomatoes on Rotten Tomatoes yeah that's okay you know what's interesting though what I watched on the airplane I watched I watched Burnt I like that movie and I like that movie and it's basically it's basically you know the bear it's also got the guy from Americans except in the movie that guy's great solid movie last week we talked about some Tarantino stuff I had never seen Jackie Brown speaking of the Prime video library I just saw it it came on to Amazon Prime this month and I'd never seen it and it's certainly not one of the best Tarantino movies it's his third worst but still good it's still good it's a slowish movie, but it has a good payoff at the end, but it's almost like deliberate would be the way to describe it, because it's like a two and a half hour long movie.

1:03:56And De Niro's in it, and his character isn't even that good in the movie. He's not even that great in the movie as one of the characters, but it still was a good movie, and I'm glad I watched it. So once a year, my wife and I go to the movies, basically. So this year, instead of seeing Barbie, which I'm probably, to be honest, I'm never going to see that movie. I'll see Oppenheimer, but I'm going to wait until it comes, and I'm going to give your review right now when you see it. You're going to say, Ben, you have to see it on IMAX. It blew me away. The seat was shaking. Like, you have to see it in the theater.

1:04:25And I'm going to go, no, Michael, I'm going to see it at home. So that's your review a week ahead of time. I'm nervous that I'm not going to like Oppenheimer. I mean, it's a drama. It's not like a— Three hours is tough, man. I don't know if I—I don't know. I'm nervous. I've learned a lot about him from reading the biography. He's a very complicated guy. So we went and saw Mission Impossible, which I love. I think Tom Cruise is, I mean, it's kind of like when Tom Brady beat the Falcons in that comeback game, like that cemented him as the greatest quarterback of all time. Last year with Top Gun, that like, there's no one ever going to pass Tom Cruise in terms of movie stardom.

1:05:00And I feel like this one is like when Brady came back and won another one of the Bucs. It's just, it's just an awesome action movie. Yeah. I mean, it's, it's, it's so good. And finally, Justified is one I think my favorite shows from the 2010s that never gets talked about as one of the best shows of the last 10 years or so. I'll do it. I'll do it during the writer's strike. I think one of the reasons I like it so much is because it feels like one of my novels that I read where it's just great. It's a great mink. And it's probably because it's based on Elmore Leonard novels, just a great character.

1:05:29And then now they have a new mini series with him going from Kentucky, Raylan Gibbons, the Timothy Oliphant guy to Detroit and dealing with people in Detroit. And it's just, I remembered like, oh my gosh, this, I loved this show. It was so, so good. Just amazing characters. You kind of have to stick with it a little bit, but great one. Love Justified. Ben, can I ask you a question? Oh, wait. Sorry, one more thing for my Mission Impossible. My middle age, you talk about me being a night owl and you going to bed early. Here's my middle age movie theater take. When we had kids, one of the transitions we made was because we couldn't have the TV loud anymore because my daughter's room was right by the TV in our old house.

1:06:06We started using subtitles. And I noticed, since I always watch movies at home now, why is there not a subtitle option in the theater? this theater has subtitles this one doesn't I think they should have subtitles for movies and the movie theater movie theaters they can't afford it that's why that's not a bad idea they should though well how about goggles I can't afford it all I gotta do is I gotta do is hit a button on my TV and it's on there why can't the movie theater afford that what if you bring goggles and then you could see it you could see the subtitles on your goggles I don't know it's not a terrible idea I love subtitles Ben before we get out of here what are your thoughts on men wearing bikinis I've never given it much thought I thought you might say that yeah I don't know I mean there's men here in bikinis and I wanted to wear one when we were in Italy as a gag you mean bikini like a bikini bottom like a banana hammock what other what else would I mean well you called it a bikini I mean a bikini is a two-piece bathing suit you're talking about a Speedo a Speedo I wanted to wear one in Italy because I thought it'd be funny and Robin did not think it was funny But I feel like I do feel determined that one day I'm going to wear a speedo just for the lulls.

1:07:17But again, I could see you wearing warm up pants down to the pool and ripping with the buttons and ripping them off and having speedo underneath. But is it comfortable? I mean. It's like we're in tight. No, not because tighty whiteys aren't comfortable. Yeah. No, very uncomfortable. Yeah, I probably wouldn't recommend it. OK, you get back to vacation. Go to Miami Vice for us. AnimalSpiritspod at gmail.com. Don't lose your Maui gems this week. Thank you. In the ocean. Thank you. All right. Thanks, everyone.