What is Wealth? (EP.375)

24:43And he said, well, I used to work in finance. I said, what'd you do? He said, I sold insurance. So as somebody who formerly worked at a place where insurance was sold, I could say you could safely stay away from people that do financial planning at insurance companies. Not to say that everyone, but it rounds up to 100%. You could stay away. But this got me thinking that people always talk about the fire hose of information we get these days and the opinions and analysis and newsletters and social media and all this stuff, podcasts. So Howard Winston always says, like, there is no such thing as information overload, only filter failure.

25:16So I saw this zero hedge graph going around. A bunch of people sent it to us. Michael Antonella, I think, tweeted it out. It says, adjusted for the collapse in the Dow, the S &P is unchanged in 50 years. And it's the S &P 500 in gold terms. And I mean, there's a million problems with this graph. Yeah, whatever. Whatever. If you think this is actual analysis, hit yourself in the head with a hammer, please. So I thought about these kinds of things. And obviously, zero hedge is the antithesis of my way of thinking. So I think Zero Hedge and Michael Lewis have probably lost more people money since the 2010s than anyone.

25:51Like, do you know when Zero Hedge was started? Oh, yeah. I think the Big Short has lost a lot of people. Probably hedge funds, too. Like, actual institutions. I think people read the Big Short and thought, like, I'm going to do this. And I think it's lost people a lot of money. I'm saying this tongue-in-cheek, kind of. Do you know when Zero Hedge was started? 2009? January of 2009. One of the biggest bull markets in history. and this, they have millions and millions of readers. Anyway. By the way, yeah, it doesn't matter what the market's done. There's a gigantic audience for this sort of information.

26:24And so I feel like at this point, like you can't be hurt by Zero Hedge anymore. Like he has his readers. It's a very self-selecting audience. You know what I mean? Like I don't think anybody like, I don't think the average civilian is like, oh my God, I was gonna invest for the longterm. and then I saw this chart from Zero Hedge and I took all my money out. You know what I mean? Like, I don't think that happens anymore. No, no, no. Yeah, you're, and I do remember my, one of the guys I used to work with in like 2010 is like, you got to check this new blog out that I found. And he sent me a few articles and I looked at the comments and I was like, oh, I'm out.

26:57Sorry. These are not my people. That's probably the last Zero Hedge article I've ever looked at. All right, so I thought of some things that like my personal filters, if I see someone doing this, you're out to me. You're dead to me, right? I don't follow your financial advice. So here we go. Pricing stocks in anything else. Gold, yen, Bitcoin. I think I saw someone do like earnings price in gold a couple weeks ago. Like anything like that. Pricing the stock market in something else. Sorry, you're out to me. Price return only, no dividends. Right? If you can't do a long-term chart in dividends and you're comparing price returns, I'm ignoring whatever you're saying.

27:32Everything viewed through a political lens, that's obvious. Right? I still don't understand. I do understand, but I don't. why we have Democratic and Republican economists. Like, shouldn't you just be an economist? Like, and look at policies through, like, this is good or bad, not, this is good because it's Democratic or bad, whatever. The person who follows everything that a billionaire say or do. Like, Buffett, well, Buffett holds $270 billion in T-bills, so what do you think that means? Or the Buffett indicator, or Soros Bites puts, or the person who, like, they do everything because billionaires say or do so.

28:05Yeah, yeah, that's good. Permabearers, obviously. I think conspiracy theorists are a set of their own, especially like the Fed, anti-Fed people. I don't think I've ever agreed with an anti-Fed person about something. Anyone who uses the word fiat, you're out. Like if you use the word fiat a lot, I think you're probably someone I can safely ignore. And guys who wear bow ties. Are there probably people who wear bow ties who give good financial advice? Yes. Tom Kean. Yeah, probably people in the South, but I'm saying 95 % of people who wear bow ties are probably giving bad information. Yeah, that's absolutely fair.

28:43All right, and one more. People who are way too hung up on the past. So like this one thing that shaped them is the only thing that they care about. So for some people, it's the 1970s inflation. When I was at Lehman. 1987 crash, 1929 crash, 2008 crisis. Any time where you bring everything back to a specific moment because you remember that or you studied about it. Those are my people to ignore. Yes. Any additions? Probably, but I think you covered it. That was good. That was good. That's all I got. People with hair? Can't trust them? That's true. That'd be an interesting study. What's the over-under performance with people who are bald and people who have hair?

29:28I don't know. All right. Ryan Dietrich tweeted, U.S. Durable Goods New Orders. skyrocketed in the most recent report. Yes, it is volatile lately, but durable goods up nearly 10 % simply isn't something you see in a recession or an economy headed for one. So this is like refilling the inventory? Is that the deal with this? I don't know the breakdown of this, but these are like big ticket items. Refrigerators, washing machines. I'm going to help out with this. We're getting a new dishwasher soon. Why? Yours went belly up? Yeah, I mean, we use it so much. that I remember we looked at, when we were looking at houses when we first had our twins, and we saw a house that had a laundry room upstairs and a laundry room downstairs.

30:13And I thought... That's luxury. I thought, no, I thought, what a waste. Why would you, what would be the point of this? And now that we have three kids and the amount of laundry we do, I think, God, that was an amazing idea. I wish I had two laundry rooms. Yeah. We would use it. We do at least one load of laundry every single day. Are you the laundry person in your house? No, my wife does it. Okay. Are you the, you're the dish person? dishes, yes. I do the dishes. That's why I'm ready for new dishes. I always joke, the key to a healthy, a clean house is a clean sink. I agree with that. If your dishes pile up, it's over.

30:47It's game over. Yes. Yes, I agree. I was in college. I lived with seven other dudes in a house and the dishes would just pile up and pile up until, and I'd tell people, you know, guys, dishes. And then I'd end up doing them because I couldn't stand it. Gloves or no gloves? No, no gloves. No gloves. Growing up, we always had the yellow rubber gloves. And I hated the feeling of like getting the water inside. Yeah. Are those extinct? You don't see those anymore. That's true. All right. Another indicator of the economy, although I guess indicator is a strong word. Just interesting fodder. Speaking of bullshit indicators, did you see yesterday people were citing sausage demand?

31:33There was a response from the Dallas Fed survey saying that they're seeing a modest uptick in sausage ordering, which shows that people are downshifting because sausage is cheaper. Upcrease should be a word, right? Upcrease. No, we talked about this with Tal Smith on The Compound and Friends last week. I think there's just too much economic data now. Come on. If we're looking at sausages to make policies, we're in big trouble. All right. So we're talking about watches here. luxury watches. This is another face blower. Around$50 billion of brand new luxury watches are sold each year. $50 billion?

32:11Jeez. That's a lot of coin. $25 billion trade hands used. That's their words, not mine. So$25 billion on the secondary market. So$75 billion worth of watch sales a year. It's crazy. But the point of this article was showing you how the watch craze driven by all the money and the speculative frenzy of 2021. It's been down quarter over quarter for 10 quarters in a row. I would love to know what the margins are. If someone has this, what the margins are for luxury watches. Oh, I'm sure they're... I was talking to McMurtry about this at dinner the other night. We were speculating they're incredibly high.

32:58Okay. So someone told us if we want to really find a diamond in the rough here, I mentioned I'm like a fossil watch guy. From the highs in 2011, Fossil Group, which is a publicly traded stock, is down 99%. Yeah, because the Apple Watch. Yeah. 99 % drawdown. That's not good. All right. Could be the next NVIDIA. The White House had a good report on the share of grocery items with cooler inflation or price declines. So it's showing price decline year over year, which is disinflation, and then less inflation than just a year ago. And both of these are heading in the right direction. Prices are coming down.

33:41Do you think that grocery prices are the new gas prices in a lot of ways from this whole inflation outbreak? I'm putting a new chart in here too. They were. Pissed a lot of people off, myself included. Higher grocery, it just wasn't fun. It's like, because in your head, you have a bucket, you have like a mental dollar amount that you're spending every week. All right. I go to the grocery store, spend$175. Oh, now I go to the grocery store and I spend$230 for the exact same. I do believe though that people, people are not being honest about how much they used to spend on groceries. I think in there, I think people have some false memories of this, how much they used to spend on groceries.

34:20Are you saying that this inflation was in people's minds? No, no, no. I'm saying it's not nearly as bad as people think. The stuff that people post online saying, I pay double what I used to pay for groceries is just, it's not logical. Oh yeah, people exaggerate. So look at the other chart from that same article. Hours of work needed to purchase a week's worth of groceries was going down for the entire end of the decade for the 2010s, spiked in 2022, 2023, and is now falling again. And now is actually below average from the 2015 to 2019 period. So this is adjusting for wages, grocery prices. Yeah.

34:57All right, good. Let's go the right direction. We mentioned this on TCAF, but we spoke about, there was a lot of hemming and hawing about price gouging. And I think, so Axios had an article, and I think most people would agree that price gouging is a bad thing. What we mean by price gouging, not rising prices, but like taking advantage of an exogenous event. There's a hurricane. Yeah, water bottles are$13. Exactly. Who thinks that's a good idea? I think everybody, every reason person would say, yeah, price gouging should be illegal. I think the thing that people hear or are concerned about a slippery slope is, well, who's to say what's gouging?

35:37And then the next step is price controls. So I understand the logic, but the actual thing that they're trying to do is control for price gouging. Somebody emailed us. They were disappointed that we didn't talk about the idea floating out there about taxing unrealized gains, which, listen, I don't follow politics. But my understanding is that she tacitly endorsed this. It wasn't something that she's putting out there. We'll find more details on this. And listen, for the record, I think taxing unrealized gains is a horrifically stupid idea. No, yeah, but the idea being floated out there was if you have over$100 million and you had people with like$3 ,000 in the Robinhood account being like, this is absurd.

36:25Right. But nevertheless. But that's the kind of thing that would never happen in a million years. It's dead on arrival, so we don't need to worry about that. But yeah, the idea is ludicrous. I don't want to tax anybody's unrealized gains. It's a horrifically nonsensical idea that makes no sense. But also Joe Weisenthal had a great tweet on this. What'd he say? He said, so hedge fund managers, when they get their performance fees, those are only given on realized gains, right? Not unrealized gains. See, and if the hedge fund managers are complaining about it kind of thing. Not bad, not bad. Right?

36:56Okay, this is interesting. Daily chart book from Bank of America. Restaurant spending decelerated sharply in July, falling 3.9 % year over year. That's kind of a surprise. First time in a while, huh? So this is the travel thing falling as well? I wonder how much of this is also people trading down a little in terms of, it seems like people are still spending money. They're just not spending so freely anymore. And they're being a little more subjective about what they're spending money on. Duncan, send us, it costs between$2 ,500 and$4 ,000 to make a Rolex. Wow. That's actually more expensive than I would have thought.

37:38So the markup is 10X in some cases, depending on the model? I don't know the difference between the new and used ones, but. All right. Torsten Slok chart of the week. Record low number of layoffs. He said, cutting interest rates too aggressively runs the risk of triggering another run-up in inflation. See, that's what I was saying. People are saying this. You always think that I'm using these boogeymen and straw men? Listen, the one time that you brought receipts, I'm not apologizing. Keep asking. So he says that there's a record low number of layoffs. So people are looking at this and saying, well, this doesn't make any sense.

38:14I thought the labor market was cooling. So companies aren't hiring as much anymore, but they're not firing either. So the worry is, okay, the not hiring eventually translates into firing. The optimistic take would be, hopefully, if the Fed starts cutting rates and the economy irons things out a little bit, the big increase in layoffs won't come. Right? The not hiring will not shift in the way. There's a lot of noise and complexity in the data in the labor market right now. And it's just, it's complicated. We don't know what's going to happen. Nick Colas at Datatrek had this really cool chart. He does a really good job of putting his own little notes on these charts, these Fred charts.

38:57But he looked at the multiple job holders as a percentage of employed workers. And I don't know what the right number is for this. But I feel like maybe this is more of a movie, TV show thing. like you always hear people talk about like my parents worked multiple jobs to put me through college or whatever right you hear these stories like the bootstrap thing uh the peak of this in the last 30 years or so is like six and a half percent 1996 currently it's 5.3 percent and that's exactly the level it was at in 2019 so it dropped then it came back up is is five percent higher or lower than you would think for people working multiple jobs because for me i i would have assumed it would have been higher than that.

39:36Oh, really? I don't know. Just for certain people who will have a trouble making ends meet, I would have assumed multiple jobs. I would have thought the number would be 10, 15%. Maybe I'm completely out of time. I don't know. 5 % sounds high to me. I guess in my mind, I'm thinking like, how could you work two jobs? But you can't work two full-time jobs. I guess there's a lot of like part-time working here. Yeah, right. It's just multiple jobs. It's not saying it has to be full-time. Higher than I would have thought. Okay, lower than I would have thought. All right, from the National Association of Realtors, I think this is interesting just to kind of check on this.

40:12We've talked about this before, but 24 % of homes sold above list price. So they look at the last 12 months. And they look at this on a monthly basis. It's a ruling 12 months. It was 35 % a year ago. First-time homebuyers represented 29 % of buyers unchanged from last month, slightly down from July 2023. So it's still almost one third of people are new home buyers. So I know people think no one can afford a home. It's still happening. 27 % of buyers had all cash sales. This is the number that I just still don't understand. I would love to see the breakdown of how this actually works. Like how much is people that really have that much cash to spend and how much is some sort of bridge loan or whatever help from someone else?

40:54I don't get it. All right. From the Wall Street Journal, share of million dollar home. Did you look at this one yet or not? Mm-mm. Okay? Your guess. What percentage of houses in the United States are worth a million dollars or more? I saw the number. Sorry. Okay. Almost 9%. More than double the 4 % recorded before the pandemic. So close to 1 in 10 houses is worth a million dollars or more. They have this chart here that shows it's going up and to the right. 81 % of houses in San Francisco are worth a million dollars or more. In Detroit, Cleveland, Pittsburgh, and Kansas City, Missouri. Not Kansas City, Kansas.

41:30fewer than 1 % of homes were seven figures in June, according to Redfin. So come to the Rust Belt in the Midwest if you want to find more affordable homes. I don't know how a city like San Francisco, do people just never sell their homes now there and no one else comes in to buy unless you're uber wealthy? It is a good question. Yeah, I mean, the barriers to entry are thick. Okay, so there is this idea today that housing is unaffordable, But technically, housing is very affordable if you own a home. Go on. Mike Zaccardi has household mortgage. This is from Edgar Denny. Household mortgage debt as a percentage of household real estate value is near an all-time low.

42:13So this is basically your debt-to-asset ratio, debt-to-equity ratio for housing. So this is the hard part, obviously. Gen Z and young millennials get screwed, obviously. We've talked about this. But if you already own a home, it is getting more, it's getting cheaper by the year that you own it. In terms of when you adjust for the price. The price and the interest rate. Yeah. People who own a home already or did before. Come on, you're pouring salt on the wound of people on the outside. But I think this is one of the reasons why people talk about like, how can we fix housing? most people are already feeling comfortable and probably don't care enough, is what I'm saying.

43:03All right, I was driving down the highway, I don't know where I was going, and I saw a credit union sign, and it said, buy now, refi later. And I'm kind of surprised that they even are willing to print that. I'm sure that, I feel like a lot of realtors have said that to people over the last couple of years, but I don't know, I feel like that's kind of promising a lot to people. again, I hope mortgage rates fall to make it more affordable for people. I'd be worried if they don't. Yeah. I mean, they're going to. I don't know how much, but they're already coming down. It would be nice if the Fed, maybe that's what Powell just needs to say.

43:41Listen, if spreads on mortgage-backed securities don't compress and get closer to the 10-year, we're going to come in and buy. Maybe all he needs to do is say something because I just want to see that spread come in. Right? Yeah. All right, Ben, what does it take to be wealthy? What would you say? Wealth is very relative. Are we talking income or assets? Assets, net worth. Okay. I think I've changed my mind on this over the years. There's this whole idea that, listen, the amount of money you make has no bearing on your wealth because all that matters is what you keep, right? The whole wealth is what you don't see kind of thing.

44:21And I'm starting to come around to the idea that people who make a high income, regardless of how much wealth they spend, feel wealthier than people who have a lower income but save a lot. So somebody who makes$500 ,000 a year but only has half a million dollars in savings feels a lot richer than somebody who makes$150 ,000 a year and has a million and a half dollars in savings. Yes, because that person who has 500 grand and is spending a lot, they're living like they're wealthy. Yes. Are they living a life like that? Some personal finance people would vehemently disagree with that. And obviously, at some point, you need to put – but I think the people who have a higher income and can spend and live now like they're wealthy, with the assumption that they're still putting some stuff away, I think they feel wealthier, whether that is right or wrong.

45:14Yeah, I agree with that. And this is very subjective because Morgan has written things like wealth is like what you don't see or something to that effect. but not in every situation. It's, it depends anyway. Like when, when, when, yeah, when I think, when I think rich and wealth might seem synonymous, but in my mind, I think rich is income and wealth is asset level. That probably makes sense. I get that. It's kind of what I'm saying. Yeah. Yeah. So anyway, um, wealth to me is a wealth is like wealth is not the top one. Well, Well, maybe it is. I don't know. Wealth is like wealth. It's like, that's like a big word in my mind.

45:56So when I think like wealthy, my number is higher than this. But they say, what did the average American say? Two and a half million dollars to be considered wealthy. So for me, I think that's very well off. If you have two and a half million dollars, you're good, right? Like you're doing well in life. But is that wealthy? Of course you are. Because how many people in the United States have two and a half million dollars? That's probably top five, top 7%. All right, so if you're top five, top 7%, just percentage-wise, that's not wealth. To me, the wealth is like the top 1 % or the top half a percent.

46:32Oh, come on. That's way, you're moving to goalposts. What do you mean? That's my goalposts. But you have to be the top 1 % to be considered wealthy? Don't you think the top 25 % is considered wealthy to most Americans? It has to be. I'm saying this is my opinion. Okay, that's your hurdle. Yeah, I'm not saying what other people would say. I'm saying like when I think the word wealth, to me, that's like a high. You're just like pushing against that goalpost. That's a high number. Okay. All right. When you look at the percentage, the number of people who actually have two and a half million dollars, it's a very small number.

47:08Smaller than you think. The income thing too. So Kyla Scanlon tweeted this this week. I don't know where this came from. She said, according to the Census Bureau, come on, we talked about like how much you need to make to feel wealthy in certain areas. 16 % of households have incomes of at least$200 ,000 in the New York City area. In San Francisco area, 26 % do. $200 ,000 or more. And people make$200 ,000 in San Francisco probably don't feel wealthy at all. That's the point. But it's a small share of people who even make that amount in these expensive areas. So right, we said 81 % of houses in San Francisco are worth a million dollars or more.

47:45Only 26 % of people make$200 ,000 a year more. Yeah. It's semantics. I mean, but I don't know. When I think wealth, I think like a big number. But it is the goalposts. They're always a moving. For sure. My personal goalposts don't move. That's a different subject altogether. Oh, yes, they do. You think that you would have thought 1%, top 1 % back in the day when you were selling insurance or being a valet? All right, all right. Take it back. Wait, also, how many jobs have you been fired from over the years? Because I feel like every time you bring up an old job, you talk about how you got fired from it.

48:18You got fired from being a valet, you got fired from being a waiter at the camp. Any other times you've gotten fired? I've never been fired before. Have I? I don't think so. I got fired from being a waiter. We all got fired. And I did get fired from being a valet parker. That was nonsense. I left early. There was literally nobody there. Whatever. You weren't like stealing change from the cup holder or something? No. Okay. So anyway, but within this within the survey, boomers were the highest, were the highest responded. They said$2.8 million needed to be wealthy. Okay. Not surprising. So we spoke about last week about every generation lamenting that their parents had it better than they did.

49:01So somebody sent us a magazine from, a Time magazine. I'm liking these baby boomer magazine covers from the eighties. From 1986, the baby boomers turned 40. Here's a quote from the article. Still single, he is a freelance writer and editor living in a rented apartment in Santa Monica, California. He has an enviable view of the ocean, but what he really wants, he says, is to settle down and have a family. He feels funny about turning 40 this year. Middle age sounds a bit strange because many of us haven't attained the goals that our parents attained at that age. I mean, how can you be an adult when you don't own a house.

49:38Wow. He probably could have bought a house in Santa Monica for like$100 ,000 on the ocean and it's worth$10 million today. There's another quote. Many bravely refuse to admit it, yet the fact is that many baby boomers do not live as well as their parents and may never. And Ben, the hilarious thing about this article is that it wasn't even true. So it's true that people will always complain that they had it worse than their parents did. But when I say it wasn't even true, here's what I mean. So buried in the article, they showed some of the survey results. And they said of the 30 to 40 year olds, 63 % said that in general, they are better off economically than their parents.

50:23While only 28 % said they are worse off. So only 28 % of respondents said they were worse off than their parents. The entire premise of the article is that boomers have it worse than their parents. it's the same shit. We just love to complain. Yeah. Even back then, people love to complain. And even back then, surveys were nonsense. We said last week that millennials are doing better than baby boomers were at the same age, yet millennials still say we have it way harder than they did. Come on. And listen, lest anyone email us and say, oh, Michael is out of touch, $2.8 million is a shitload of money.

50:56But that doesn't mean it's wealth. In my opinion. It's a lot of money. It's rich. You're good. you have no financial worries. But wealth, like, you know the Chris Rock line? Shaq's rich. The guy who signs Shaq's check is wealthy. That's the framework through which I'm thinking about the word wealth. Right. Oprah is rich, but if Bill Gates woke up tomorrow and had as much money as Oprah, he'd jump out of the window. Yeah, well, Oprah's wealthy too, but yes. So that's all I'm saying. Heather Long tweeted a fantastic chart. As a man of the people, I think 2.8 million is plenty of money. so do I I'd be very happy if I had 2.8 million dollars for the first time there are five generations in the US workforce so we're talking Gen Z millennials, the Xers, the boomers and there's even silent generation people that are still working but here's a great quote from the article again, exactly what we just said about boomers and now millennials they show the age pay gap has risen in recent decades.

52:00So the percent difference in pay between workers over 55 and workers under 35. And there's a quote in this article that says, as younger workers wait for the higher earnings that come from career advancement, many fear they might never be able to afford homes or children. Said every generation ever. Yep. Although I do think Gen Z is going to have one of the biggest hurdles to make in terms of buying up. But guess what? they're probably going to have to wait for incomes to rise and they'll buy homes later. I think that's probably what's going to have to happen for most people. Every generation has their shit.

52:32Yep. You want to talk about playing catch up? Yes. So the Wall Street Journal had this piece. This guy wrote a piece about how he's 37 years old and has not saved enough for retirement. He's worried about it. And they went through all the reasons why. And they gave all this data on average retirement savings. You see, look, average retirement savings for people 65 to 74 is like 600 grand. So not quite your$2.8 million. dollars. And the amount of people who feel that their retirement savings on track never goes over 50 % by any age group. It's lowest for the people that are youngest, but even at 60 plus, it's like less than 50%.

53:05So I wrote about this and I got an, I got an email and I said, the biggest one that I can see in middle age with kids is I understand how people with kids put them first. Like the whole thing is always personal finance. People say like, put your oxygen mask on first, save for yourself. Don't worry about your kids. But all the people in these articles are saying, listen, I want to give my kids everything. And so I put my retirement savings off for my kids. Someone was saying they took out a home equity line of credit to pay for kids college. And they went, fell way behind in their retirement savings because of kids.

53:34And I, that to me resonates. I totally understand that. And this person emailed me and said, I can testify to the article. It's true based on my experience. We built 90 % of our retirement in a 13 year span beginning when our last kid of four was completing college. Four kids dominated our budget. So when we sold our house in Tennessee and paid off a home equity loan that we used to pay for colleges and a wedding. We had enough money to buy dinner that night. They're saying like they had no money set aside, basically. So she said they moved to Ohio, bought a modest house and began to save every penny they could to make up for lost time.

54:03They did every taxable. They did 401ks, IRAs, dividend stocks. They used all the catch-up provisions. And then they've been retired for eight years now, travel often and spend time with the four grandkids and nine or four kids and nine grandkids. Life is good. And it's possible indeed to play catch-up and have a wonderful retirement. that so my whole point was like it's not you can still salvage it you just have to all the money you were funneling to kids now you funneled to retirement so it was interesting to hear someone who say that's exactly what we did a friend of the show Andrew sent us it was in Bank of America 10 facts about the consumer that every investor should know some good stuff in here the top 10 % of US households are responsible for 21.5 % of total US consumption So the top 10 are responsible for more consumption than the bottom 30 % of households.

54:54That makes sense. U.S. household net worth reached a record$160.8 trillion. That's a lot of money. That's a lot of 2.8 millionaires in there. That's a lot of 2.8 millionaires. All right, and here's the big one. With just 4.3 % of the world population, the US accounts for 32 % of worldwide personal consumption, underscoring the importance of US consumers at home and abroad. This is nuts. 4 % of the population, 32 % of spending. And we buy everything. We do. We buy everything. You know what I bought on Amazon yesterday? Bought it yesterday, came yesterday. A chicken shredder. Do you know what a chicken shredder is?

55:36Shreds a piece of chicken somehow? I don't. Yes. So I saw a video on Instagram. I told you I've become a food influencer, heavily influenced by the influencers. You put a chicken breast in a crackpot and you shred it with two forks. Yeah. With this thing, it's like a grinder and you do this three times and boom, your chicken's all shredded. Bought it for whatever, 15 bucks on Amazon. We buy everything. There's nothing we don't have. It's the kind of thing that just, it messes with your drawers and every time you try to open your drawer, it gets stuck like, and you pull your drawer open and it gets stuck.

56:12Yes. You're like, oh, God, I can't. And then you use it maybe once every three years. Yes. I used it yesterday. Probably won't use it again, but I did use it yesterday. So Tom Barkin was on AdLots. He's like the Fed chair of Richmond or something. He was on AdLots. And he was talking about how in the pandemic, savings rates in the U.S. and around the globe shot up to like 16%, 17%. And he said the same thing happened in the U.S., same thing happened in Germany. But he said, of course, after things subsided, savings rates went way back down in the U.S., back down to 3 % or something. But he said in Germany, it stayed at 17%.

56:43So I think, I don't know what it is about consumption in this country, but it's a cultural phenomenon that doesn't exist in other countries. It's just, it's somehow ingrained in us that we love to spend money. Oh, I need that. Oh, I need that. Yes. And it's easier than ever to get stuff if you need it. Okay. Mike Sicardi tweeted this chart about streaming. Check this out. Bank of America says there are some tentative signs of a pullback in total streaming spending in 2024. So they show discretionary spending, spending on entertainment, which is still going up, and streaming, which seemed to have peaked a few months ago.

57:19They also show that there's a slowdown in the growth of households with one or more streaming payments per month, from 8 % down to less than 3%. So people are, you know, as the economy reopens and, well, reopened, and people move on with their lives, they're just not subscribing to every streamer anymore. I still am. All right. This has me quite excited. Have you given it up on any streaming networks? I've not given up on any of them. No, I still have them all. I don't pay for MGM. I think that's the one. All right. Oh, yeah. You mentioned that Challengers movie. You said watch the movie Challengers.

57:53And I pulled it up in my little app that shows where the movies are streaming. And it was on MGM+. I'm like, God. That's it? Look at this one, too? Who has MGM+. It's not that good. Okay. MGM. Was it MGM+. I think so. I think they have 94 subscribers. All right. Ari Myrov at MySportsUpdate tweeted, YouTube TV will now also offer Fantasy View, allowing Yahoo and NFL.com users to link their fantasy teams to their YouTube TV accounts, which will provide key plays and multi-view options personalized to each viewer's fantasy football roster. Have we ever had it this good? The kids don't know how good we have it, Ben.

58:38The four box thing that YouTube TV does is just amazing. And now you could customize your quad box. So you're going to be able to watch whatever games you want. I mean, this is just a wonderful development. Another interesting development. Someone, I said this a couple weeks ago and someone said, no, no, no, no. Back in the 90s, we had picture in picture. I never once got picture in picture to work correctly. It never worked. Never worked. That's right. That's right. It never worked. a new NFL world from Adam Schefter NFL owners will vote today on a proposal that will allow teams to sell up to a total of 10 % of each team to elicit permitted private equity firms so how quickly does Blackstone and the others jump on like immediately private equity is a bubble right hop on I guess it makes sense for some of these owners would want some liquidity occasionally private equity is just a piece of everything after speaking with Michael Sijmore last week.

59:35I bought two starter positions in private equity stocks. I bought Blackstone and Blue Owl. He made a pretty compelling case for the fact that buying the stocks might be a better investment than buying the private equity funds. Yeah. Jared Dillian is on the other side of this. He thinks that private equity is in a bubble and it's going to collapse. And I think he owns, he's short Blackstone. I don't know if he has puts or whatever, but he might be right. It might be a bubble that horrifically bursts. I think that we are in the early innings of the wealth management channel just shoveling money.

1:00:08They already have trillions of dollars on the sideline. Guess what that translates into? Billions of dollars in management fees. Exactly. I wouldn't bet against the private equity industry. Yeah. I'm not saying that their investments are going to turn out wonderfully. Yeah, that's not even, that's neither here nor there. You know what's going to be guaranteed? The fees. The people working at the private equity company will make off better than their investors. How's that? Way better. We'll see. Perhaps. I was watching Hard Knocks and I saw Mercedes Lewis is still going. He's on the Bears. What in the world?

1:00:43He's the second oldest player in the league besides for Aaron Rodgers. He's 40 years old. Pretty sure there's never been a skilled position player that's 40. This is going to be a theme in the years ahead, especially. We've already seen this a lot, but older people not wanting to relinquish their positions or positions of power. People are going to be staying and doing jobs and stuff longer and longer and longer. That's where we're heading. All right. There was an article in the Wall Street Journal talking about the best uncrowded national parks. And number one is Isle Royale or Royal. I don't know how you pronounce it.

1:01:13National Park in Michigan. You familiar? My brother went there last week for a camping trip. Really? You have to take a ferry to get there. It's a huge island. There's moose on the island, I guess. Wolves. But it's very remote, but it's supposed to be beautiful. You don't strike me as an outdoorsman. No offense. No, like camping. No, that's not me. I love it. You are a camper. Oh yeah. Big outdoorsman. Love it. Now I haven't been camping in more than 10 years, but I do enjoy it. You like the idea of it. I love it. Not actually doing it. I do fish and stuff with the kids. I kind of do outdoor stuff.

1:01:51But I went to, we did Yellowstone. Actually, we did this a long time ago, the year after the Giants won the Super greatest week of my life. I want to do these. I'm an advocate for the national parks. My wife and I talk a lot about wanting to take the kids out west and do a bunch of those. I think it'd be fun. Ben, this surprised me. There's a proposed deal between Seven and I Holdings, which is a Japanese company that owns 7-Eleven and a Canadian company that owns a bunch of convenience stores. I would have thought that the top 10 convenience stores accounted for a much larger percentage of the overall market.

1:02:32It's only 10, 21%. I can't believe that 7-Eleven is owned by a Japanese company. How is that not an American brand? Blew my face. We stopped on the way home. So we drove home from Boston, and we stopped at a rest stop. But rest stops are weird places. Yeah. Right? What percentage of rest stop bathrooms smell good? 4 %? Just awful smells, right? Okay, I talked last week about how culturally when I was in Europe, no one liked small talk. They didn't like the head nods, that sort of thing. This guy on Twitter did this whole thread about what he learned traveling from Europe to America. And it was some really good stuff in there.

1:03:12And he talked a lot about consumption and the stuff we buy. But he said, how are you is thrown around way too casually in the U.S. As a German, I'm not used to exchanging pleasantries with strangers such as cashiers like that. It feels kind of fake to ask a question that no one really wants an honest answer to, but I guess it's part of American social norm. So he's on board with this. It really is a thing. Yeah. Maybe I would do way better in Europe. I certainly would. I don't exchange pleasantries. Are you kidding me? Okay. What's this? Apologies to Michael. Because someone called you a troglodyte, and that's the kind of word that sounds way worse than what it really is.

1:03:46I have to Google it. So. So like a troglodyte sounds like, does this person eat feces or something? It sounds like a really bad word. You knew what that word meant? Yeah, I had to look it up too. It's a caveman. So maybe I'll prove this guy's point. So he said. A person with simple taste, right? I used to think of Michael was, I used to think Michael was a troglodyte. A nice troglodyte, but uninformed about so many things. Expressions, geography. I'm good with geography. General knowledge, like what an inner tube for a boat is used for and more. I realized, though, that not everybody has vast curiosity or was exposed to the world growing up.

1:04:27Jeez. Well, that's true. I wasn't really exposed to the world growing up. We kept it northeast. I was not an airplane guy. Stayed on Long Island. Yeah, no travels abroad for me. No Europe, no Caribbean. He's good at what he does, is a very pleasant guy, and has a good sense of humor. Thank you. He's every man. Damn right I am. Just a great person you'd grab a beer with. He likes horror movies and the Knicks and Eli. Put a thesaurus in front of him and he'll think it's a book about a dinosaur. But put a chart in front of him and suddenly he's a virtuoso. Apologies, Michael. This is not meant to be backhanded, although I guess it could be read that way.

1:05:00Oh, you think? Oh, you think it could be read that way? He thinks the thesaurus is a dinosaur. Oh, man. He's not exactly wrong. So I thought this like reminded me to think about my educational experience. And I was always a bad student. I think I had undiagnosed ADHD or what my mother referred to as spilkis. I just couldn't sit still, was never motivated by grades. And I think that I had like, I was like arrogant about how smart I was. Not that I had like such a high IQ. I never thought that. But like, I just, I thought I'd be okay in life. And then I, yeah, school was for everybody else. I didn't need to pay attention.

1:05:36I feel like New Yorkers have this sense of street smarts that is, right? It's a street smart thing. I had a high EQ and my IQ was like, you know, maybe slightly above average. But I had like this weird arrogance that everything would turn out okay. And it turned out like it did eventually, but only because I got very lucky. It did not turn out okay. Like I spoke many times about my early career struggles and it was not okay. But not to brag, I did do well enough on my SATs because I didn't do well in high school. I didn't, you know, do homework or anything like that. But on my SATs, I got a 680 in math and a 640 in English.

1:06:09Pretty decent split. So I was an early admit to, or a direct admit or whatever it's called to the Kelly School of Business in Indiana, which at the time was like top 15. So not so bad. But what was so bad was I never had the skills or the preparation, like the practice in high school to transition to the pros. And so I treated college like I treated high school and it didn't work well. So I pulled up my transcript and I took five classes, basic accounting skills. I got a C. I'm looking at these grades. The computer and business, I dropped that. What's a W, withdrawal? Withdrawal. Intro to argumentative writing, I got a D plus.

1:06:48Not bad. American history, I love history. I got a C. And then introduction to philosophy, I got a D. So my GPA in my first semester, what is that? Where is that? 1.49? 1.49. You know what? In my head, I thought that I got a 0.9 and then like a lower than that. Not so bad. So 1.49, not good, but not catastrophic. And then the wheels really fell off. Although, let's be honest, 1.49 is pretty bad. In the second semester, I got a C plus, a D, a C minus, an F. Intro to microeconomics, I got an F.

1:07:25I just did it. I was such a jackass, and I'm not proud of this. I don't know what I was thinking. I didn't even take the test, I don't think. And then I, calculus, I withdrew. So I got a 1.175 in my second semester and a blended of whatever. Not good. And that was go back home. Good enough to get kicked out. Yeah. So. I'm not even angry. That's impressive. I thought I did pretty bad my first semester. You make me feel pretty good. Yeah, I did not have the life skills. I was a baby. Some people don't. All right, story time. Last week, first day back at school for the kids, I dropped my twins off.

1:08:04We're two different schools now because my daughter's at middle school, so I dropped the twins off there, elementary school. And driving through the neighborhood, you see all the people waiting for the buses, right? All at the bus stop. First day, everyone's there. What stood out to me was the number of dads at the bus stop with their kids. That's great. Like, mostly dads. And I feel like in the past, you never would have seen that. And I think there's two things going on here. One is millennial parents are more helicopter-y than the past, right? Parents are just more involved in everything. But two, I think the remote work thing has done wonders for parents being more involved with their kids.

1:08:40The fact that you have the ability to work from wherever for a lot of people means you have more time to do stuff like that with your kids. I think in certain cases, dads benefited more than moms. At least in my case, my wife is an educator and educators are predominantly not, I don't know what the splits are, but there's more women teaching than men. And so my wife doesn't have the flexibility. Obviously, she has to be at school. Right. Now, I have the flexibility to be at home, and I drive my kids outside the bus, and it's the greatest thing ever. Prior to the pandemic, I don't know what we would have done.

1:09:09We would have had to get a nanny. I don't know how some people do it. Because school starts, for us, at 8.45, and it's out at 3.45. If you have a 9-to-5 job, it's really tough. I mean, they have after-school or before-school care, or whatever, but buses. It's hard. Raising kids is tough. It is. The timing of it just doesn't make sense all the time. Yeah, especially for two working parents. recommendations. I got one streamer, The Tourist. It's on Netflix. I think the first season was on HBO. Now it's somehow gone to Netflix and it's the story about this guy. The first season is set in Australia.

1:09:45It's a born identity thing. He wakes up, he has no idea who he is and he has the amnesia but he's a bad guy and it's a really good twist and turns and the second season goes to Ireland where he's from and then it's like here's some of the bad stuff you left in your wake and now you have to try to remember why these people are out to get you. I really like it. It's not a show a lot of people talk about. Never heard of it. Six episodes. Six episodes. It's a very good show. Watch Furiosa on HBO Max. Thoughts? Furiosa is a movie about supply chains. And the benefits of free trade. Think about it. They have to make this huge war machine to go to Guzzoline Town to give lettuce for gas.

1:10:26And they're fighting off people. It's like it's hard. Supply chains are hard in that movie. It's a whole movie about supply chains. What did you think about the film? It's good. You're right. My wife and I both said, I love Mad Max Fury Road. I thought it was awesome. But my wife and I both go, what was it about again? And neither of us could remember. Like I had the wives and Tom Hardy. But that's the beauty. The plot is incidental to the movie. It doesn't matter. So I went back and started watching Fury Road again. And you're right. It's a very similar plot. I'm like, oh, they took a lot from it.

1:10:55I actually thought Chris Hemsworth is very entertaining in a new one. He's really good. He's very good. But my review of Furiosa, it's 70 % as good as Mad Max. And it's the same thing. And it's 45 minutes. You're right. You're right. It's the same thing, but not as good. And I actually thought the chase scenes in Mad Max are so much better. The ones in Furiosa look faker. The ones in Mad Max look actually kind of real. Yeah. So that's what I got. But it's a movie about supply chains. So Ben, last week we spoke about the box office being top heavy. I had Sean and Chart Kid, Matt, go back further.

1:11:24And it's kind of crazy. Before the pandemic, the top 10 took like 27 % to 35 % of the box office. It was pretty – It's surprising how – Yeah, it doesn't move very much. The range is pretty narrow. And then it just – People change their habits. And now we go to see blockbusters pretty much only. Wow. And so it's funny. So I wrote a blog post about it. I said the Judd Apatow days, they're over. They're not coming back. And then last night I watched a movie that was of the Judd Apatow ilk called Incoming on Netflix. Yeah. 90 minutes. I loved it. 90 minutes. High school. I'm putting it on my list.

1:12:01High school comedy. Bobby Cannavale was the teacher that partied with the kids and he was hilarious. I like him. I had a great time. I really did. Okay. Endorse. Fun movie. Are you caught up on industry? I'm through two and a half episodes. I got to say, I don't like it as much as you do. Okay. I just. It's funny you mentioned that. I'm not going to review it every episode, but the third episode, it's like, It's turning not quite as good as it used to be. I really liked the first season. I think it's been a severe drop off since then. Yeah, fair. Lastly, and sorry, Duncan, for going along on your birthday.

1:12:36Actually, this is two episodes in a row. Last week was our longest episode ever. I think we surpassed that this week. Two chatty Cathy's here.

1:12:45I saw on Max last night that there's a City of God series. There's a show, TV show. The movie was amazing. Easily one of the best. You see that movie one time and it sticks with you forever. Yeah. Right? Like 100 % approval rating. So I might check it out. All right. Thank you for sticking with us. Thank you for the emails. Even the person who called me a troglodyte. I appreciate that it was meant in the way it was received. So no hard feelings, although a bit bad candy. It's okay. AnimalSpirits at theCompoundNews.com Thank you for listening We'll see you next time